Document:

REGAL-BELOIT CORPORATION 

2.75% Convertible
Senior Subordinated Notes Due 2024 

     

INDENTURE 

Dated as of April 5,
2004 

     

U.S. BANK
NATIONAL ASSOCIATION  

TRUSTEE 

     

TABLE OF CONTENTS 

Page 

ARTICLE 1
                                              
DEFINITIONS AND INCORPORATION BY REFERENCE 

	Section 1.01.	Definitions	1 
	Section 1.02.	Other Definitions	8 
	Section 1.03.	Incorporation By Reference Of Trust Indenture Act	9 
	Section 1.04.	Rules Of Construction	10 
	Section 1.05.	Acts of Holders	10 

ARTICLE 2
                                                            
THE SECURITIES 

	Section 2.01.	Form And Dating	11 
	Section 2.02.	Execution And Authentication	12 
	Section 2.03.	Registrar, Paying Agent And Conversion Agent	13 
	Section 2.04.	Paying Agent To Hold Money And Securities In Trust	14 
	Section 2.05.	Securityholder Lists	14 
	Section 2.06.	Transfer And Exchange	14 
	Section 2.07.	Replacement Securities	16 
	Section 2.08.	Outstanding Securities; Determinations Of Holders' Action	17 
	Section 2.09.	Temporary Securities	17 
	Section 2.10.	Cancellation	18 
	Section 2.11.	Persons Deemed Owners	18 
	Section 2.12.	Global Securities	18 
	Section 2.13.	CUSIP Numbers	24 
	Section 2.14.	Contingent Debt Tax Treatment	24 
	Section 2.15.	Calculation Of Tax Original Issue Discount	24 

ARTICLE 3
                                                       
REDEMPTION AND PURCHASES 

	Section 3.01.	Company's Right To Redeem; Notices To Trustee	24 
	Section 3.02.	Selection Of Securities To Be Redeemed	25 
	Section 3.03.	Notice Of Redemption	25 
	Section 3.04.	Effect Of Notice Of Redemption	26 
	Section 3.05.	Deposit Of Redemption Price	27 
	Section 3.06.	Securities Redeemed In Part	27 
	Section 3.07.	Purchase Of Securities By The Company At Option Of The Holder	27 
	Section 3.08.	Purchase Of Securities At Option Of The Holder Upon Fundamental Change	29 
	Section 3.09.	[Reserved.]	33 

i 

	Section 3.10.	[Reserved.]	33 
	Section 3.11.	[Reserved.]	33 
	Section 3.12.	Effect Of Purchase Notice Or Fundamental Change Purchase Notice	33 
	Section 3.13.	Deposit Of Purchase Price Or Fundamental Change Purchase Price	35 
	Section 3.14.	Securities Purchased In Part	35 
	Section 3.15.	Covenant To Comply With Securities Laws Upon Purchase Of Securities	35 
	Section 3.16.	Repayment To The Company	35 

ARTICLE 4
                                                               
COVENANTS 

	Section 4.01.	Payment of Securities	36 
	Section 4.02.	SEC And Other Reports	36 
	Section 4.03.	Compliance Certificate	37 
	Section 4.04.	Further Instruments And Acts	37 
	Section 4.05.	Maintenance Of Office Or Agency	37 
	Section 4.06.	Delivery Of Certain Information	37 
	Section 4.07.	Liquidated Damages Notice	38 

ARTICLE 5
                                                           
SUCCESSOR PERSON 

	Section 5.01.	When Company May Merge Or Transfer Assets	38 

ARTICLE 6
                                                         
DEFAULTS AND REMEDIES 

	Section 6.01.	Events Of Default	39 
	Section 6.02.	Acceleration	42 
	Section 6.03.	Other Remedies	42 
	Section 6.04.	Waiver Of Past Defaults	43 
	Section 6.05.	Control By Majority	43 
	Section 6.06.	Limitation On Suits	43 
	Section 6.07.	Rights Of Holders To Receive Payment	44 
	Section 6.08.	Collection Suit By Trustee	44 
	Section 6.09.	Trustee May File Proofs Of Claim	44 
	Section 6.10.	Priorities	45 
	Section 6.11.	Undertaking For Costs	45 
	Section 6.12.	Waiver Of Stay, Extension Or Usury Laws	46 

ARTICLE 7
                                                                
TRUSTEE 

	Section 7.01	Duties Of Trustee	46 

ii 

	Section 7.0.2	Rights Of Trustee	47 
	Section 7.03.	Individual Rights Of Trustee	49 
	Section 7.04.	Trustee's Disclaimer	49 
	Section 7.05.	Notice Of Defaults	49 
	Section 7.06.	Reports By Trustee To Holders	49 
	Section 7.07.	Compensation And Indemnity	50 
	Section 7.08.	Replacement Of Trustee	50 
	Section 7.09.	Successor Trustee By Merger	51 
	Section 7.10.	Eligibility; Disqualification	51 
	Section 7.11.	Preferential Collection Of Claims Against Company	52 

ARTICLE 8
                                                        
DISCHARGE OF INDENTURE 

	Section 8.01.	Discharge Of Liability On Securities	52 
	Section 8.02.	Repayment To The Company	52 

ARTICLE 9
                                                              
AMENDMENTS 

	Section 9.01.	Without Consent Of Holders	52 
	Section 9.02.	With Consent Of Holders	53 
	Section 9.03.	Compliance With Trust Indenture Act	55 
	Section 9.04.	Revocation And Effect Of Consents, Waivers And Actions	55 
	Section 9.05.	Notation On Or Exchange Of Securities	55 
	Section 9.06.	Trustee To Sign Supplemental Indentures	56 
	Section 9.07.	Effect Of Supplemental Indentures	56 

ARTICLE 10
                                                              
CONVERSIONS 

	Section 10.01.	Conversion Privilege	56 
	Section 10.02.	Conversion Procedure; Conversion Price; Fractional Shares	58 
	Section 10.03.	Payment Of Cash In Lieu Of Common Stock	61 
	Section 10.04.	Adjustment of Conversion Rate	62 
	Section 10.05.	Effect of Reclassification, Consolidation, Merger or Sale	72 
	Section 10.06.	Taxes on Shares Issued	73 
	Section 10.07.	Reservation of Shares, Shares to Be Fully Paid; Compliance with Governmental Requirements; Listing of Common Stock	74 
	Section 10.08.	Responsibility of Trustee	75 
	Section 10.09.	Notice To Holders Prior To Certain Actions	75 
	Section 10.10.	Rights Issued in Respect of Common Stock Issued upon Conversion	76 
	Section 10.11.	Unconditional Right Of Holders To Convert	77 

iii 

ARTICLE 11
                                                          
CONTINGENT INTEREST 

	Section 11.01.	Contingent Interest	77 
	Section 11.02.	Payment Of Contingent Interest	78 
	Section 11.03.	Contingent Interest Notification	78 

ARTICLE 12
                                                             
SUBORDINATION 

	Section 12.01.	Agreement Of Subordination	78 
	Section 12.02.	Payments To Holders	79 
	Section 12.03.	Subrogation Of Securities	81 
	Section 12.04.	Authorization To Effect Subordination	82 
	Section 12.05.	Notice To Trustee	83 
	Section 12.06.	Trustee's Relation To Senior Debt	84 
	Section 12.07.	No Impairment Of Subordination	84 
	Section 12.08.	Certain Conversions Not Deemed Payment	84 
	Section 12.09.	Article Applicable To Paying Agents	84 
	Section 12.10.	Senior Debt Entitled To Rely	85 

ARTICLE 13
                                                             
MISCELLANEOUS 

	Section 13.01.	Trust Indenture Act Controls	85 
	Section 13.02.	Notices	85 
	Section 13.03.	Communication By Holders With Other Holders	86 
	Section 13.04.	Certificate And Opinion As To Conditions Precedent	86 
	Section 13.05.	Statements Required In Certificate Or Opinion	86 
	Section 13.06.	Separability Clause	87 
	Section 13.07.	Rules By Trustee, Paying Agent, Conversion Agent and Registrar	87 
	Section 13.08.	Legal Holidays	87 
	Section 13.09.	GOVERNING LAW	87 
	Section 13.10.	No Recourse Against Others	87 
	Section 13.11.	Successors	87 
	Section 13.12.	Multiple Originals	87 

	EXHIBIT A	Form of Global Security
	EXHIBIT B	Form of Certificated Security
	EXHIBIT C	Transfer Certificate

iv 

        INDENTURE
dated as of April 5, 2004 between REGAL-BELOIT CORPORATION, a Wisconsin corporation
(“Company”), and U.S. BANK NATIONAL ASSOCIATION
(“Trustee”). 

        Each
party agrees as follows for the benefit of the other party and for the equal and ratable
benefit of the Holders of the Company’s 2.75% Convertible Senior Subordinated Notes
Due 2024: 

ARTICLE 1 
DEFINITIONS
AND INCORPORATION BY REFERENCE  

        Section
1.01 Definitions.  

        “144A
Global Security” means a permanent Global Security in the form of the Security
attached hereto as Exhibit A, and that is deposited with and registered in the name of the
Depositary, representing Securities sold in reliance on Rule 144A under the Securities
Act. 

        “Affiliate”
of any specified person means any other person directly or indirectly controlling or
controlled by or under direct or indirect common control with such specified person. For
the purposes of this definition, “control” when used with respect to any
specified person means the power to direct or cause the direction of the management and
policies of such person, directly or indirectly, whether through the ownership of voting
securities, by contract or otherwise; and the terms “controlling” and
“controlled” have meanings correlative to the foregoing. 

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

        “Board
of Directors” means either the board of directors of the Company or any duly
authorized committee of such board. 

        “Board
Resolution” means a resolution of the Board of Directors. 

        “Business
Day” means, with respect to any Security, a day that, in the City of New York, is
not a day on which banking institutions are authorized by law or regulation to close. 

        “Capital
Lease Obligation” means, at the time any determination thereof is to be made, the
amount of the liability in respect of a capital lease that would at such time be required
to be capitalized on a balance sheet in accordance with GAAP. 

1 

        “Capital
Stock” for any corporation means any and all shares, interests, rights to
purchase, warrants, options, participations or other equivalents of or interests in
(however designated) stock issued by that corporation. 

        “Certificated
Securities” means Securities that are in the form of the Securities attached
hereto as Exhibit B. 

        “Common
Stock” means the common stock, $0.01 par value per share, of the Company existing
on the date of this Indenture or any other shares of Capital Stock of the Company into
which such Common Stock shall be reclassified or changed. 

        “Company”
means the party named as the “Company” in the first Section of this Indenture
until a successor replaces it pursuant to the applicable provisions of this Indenture and,
thereafter, shall mean such successor. The foregoing sentence shall likewise apply to any
subsequent such successor or successors. 

        “Company
Notice” means a notice to Holders delivered pursuant to Section 3.07. 

        “Company Request”
or “Company Order” means a written request or order signed in the name of
the Company by any two Officers. 

        “Contingent
Interest” means such interest payable as described in Article 11. 

        “Conversion Price”
as of any date means $1,000 divided by the Conversion Rate as of such date. 

        “Conversion
Rate” has the meaning set forth in Section 10.02(a) hereof. 

        “Conversion Settlement
Date” means (i) the Conversion Date or (ii) if the Company elects to pay cash in
lieu of Common Stock pursuant to Section 10.03, the Business Day following the final day
of the Cash Settlement Averaging Period. 

        “Corporate
Trust Office” means the principal office of the Trustee at which at any time its
corporate trust business shall be administered, which office at the date hereof is located
at 100 Wall Street, Suite 1600, New York, NY 10005, Attention: Corporate Trust Services,
or such other address as the Trustee may designate from time to time by notice to the
Holders and the Company, or the principal corporate trust office of any successor Trustee
(or such other address as a successor Trustee may designate from time to time by notice to
the Holders and the Company). 

        “Credit
Agreement” means the Credit Agreement, dated September 29, 2000, among
Regal-Beloit Corporation and each of the banks party thereto, including any related notes,
guarantees, collateral documents, instruments and agreements executed in connection
therewith, and in each case as amended, restated, renewed, supplemented, extended or
otherwise modified from time to time (including to increase the amount of available
credit), and all direct and indirect refundings, refinancings and replacements of all or
any part thereof. 

2 

        “Designated
Senior Debt” means (a) any Indebtedness from time to time outstanding under the
Credit Agreement and (b) any particular Senior Debt of the Company the principal amount of
which is $25 million or more and in which the instrument creating or evidencing the same
(or any related agreements or documents to which the Company is a party) expressly
provides that such Senior Debt shall be “Designated Senior Debt” for purposes of
this Indenture (provided that such instrument, agreement or other document may
place limitations and conditions on the right of such Senior Debt to exercise the rights
of Designated Senior Debt). 

        “Designated
Subsidiary” shall mean any existing or future, direct or indirect, Subsidiary of
the Company whose assets constitute 15% or more of the total assets of the Company on a
consolidated basis. 

        “Exchange
Rate Contract” means, with respect to any Person, any currency swap agreements,
forward exchange rate agreements, foreign currency futures or options, exchange rate
collar agreements, exchange rate insurance and other agreements or arrangements, or
combination thereof, the principal purpose of which is to provide protection against
fluctuations in currency exchange rates. An Exchange Rate Contract may also include an
Interest Rate Agreement. 

        “Final
Offering Memorandum” means the offering memorandum dated March 31, 2004 relating
to the offering of the Securities. 

        “GAAP”
means generally accepted accounting principles set forth in the opinions and
pronouncements of the Accounting Principles Board of the American Institute of Certified
Public Accountants and statements and pronouncements of the Financial Accounting Standards
Board or in such other statements by such other entity as approved by a significant
segment of the accounting profession, which are applied on a consistent basis. 

        “Global
Securities” means Securities that are in the form of the Securities attached
hereto as Exhibit A, and that are registered in the register of Securities in the name of
a Depositary or a nominee thereof, and to the extent that such Securities are required to
bear the Legend required by Section 2.06, such Securities will be in the form of a 144A
Global Security. 

        “Guarantee”
means a guarantee, other than by endorsement of negotiable instruments for collection in
the ordinary course of business, direct or indirect, in any manner, including, without
limitation, letters of credit and reimbursement agreements in respect thereof, of all or
any part of any Indebtedness. 

3 

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

        “Indebtedness”
means, with respect to any Person, any indebtedness of such Person, whether or not
contingent, in respect of borrowed money or evidenced by bonds, notes, debentures or
similar instruments or letters of credit, or reimbursement agreements in respect thereof,
or representing Capital Lease Obligations or the balance deferred and unpaid of the
purchase price of any property, including pursuant to sale-and-leaseback transactions, or
representing any hedging obligations under an Exchange Rate Contract or an Interest Rate
Agreement, except any such balance that constitutes an accrued expense or trade payable,
if and to the extent any of the foregoing indebtedness, other than obligations under an
Exchange Rate Contract or an Interest Rate Agreement, would appear as a liability upon a
balance sheet of such Person prepared in accordance with GAAP, and also includes, to the
extent not otherwise included, the Guarantee of items which would be included within this
definition. The amount of any Indebtedness outstanding as of any date shall be the
accreted value thereof, in the case of any Indebtedness issued with original issue
discount. Indebtedness shall not include liabilities for taxes of any kind. 

        “Indenture”
means this Indenture, as amended or supplemented from time to time in accordance with the
terms hereof, including the provisions of the TIA that are deemed to be a part hereof. 

        “Interest”
means interest payable on each Security pursuant to Section 1 of the Securities. 

        “Interest
Rate Agreement” means, with respect to any Person, any interest rate swap
agreement, interest rate cap agreement, interest rate collar agreement or other similar
agreement the principal purpose of which is to protect the party indicated therein against
fluctuations in interest rates. 

        “Interest
Payment Date” means March 15 and September 15 of each year, commencing September
15, 2004. 

        “Interest
Record Date” means February 28 (or February 29 in such years as there is a
February 29) and August 31 of each year. 

        “Issue
Date” of any Security means the date on which the Security was originally issued
or deemed issued as set forth on the face of the Security. 

        “Liquidated
Damages” means the interest that is payable by the Company pursuant to the
Registration Rights Agreement upon a Registration Default (as defined in such agreement). 

4 

        “Measurement
Period” means the six-month period from March 15 to September 14 or from
September 15 to March 14, commencing with the period beginning March 20, 2009 and ending
September 14, 2009. 

        “NYSE”
means The New York Stock Exchange, Inc. 

        “Obligations”
means any principal, interest (including interest accruing after the commencement of any
bankruptcy, reorganization, insolvency or similar proceeding related to the Company or any
Subsidiaries, whether or not allowed or allowable as a claim in such proceeding),
penalties, fees, indemnifications, reimbursements, damages and other monetary obligations
payable under or in respect of the documentation governing any Indebtedness. 

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

        “Officers’
Certificate” means a written certificate containing the information specified in
Sections 13.04 and 13.05, signed in the name of the Company by any two Officers, and
delivered to the Trustee. An Officers’ Certificate given pursuant to Section 4.03
shall be signed by an authorized financial or accounting Officer of the Company but need
not contain the information specified in Sections 13.04 and 13.05. 

        “Opinion
of Counsel” means a written opinion containing the information specified in
Sections 13.04 and 13.05, from legal counsel. The counsel may be an employee of, or
counsel to, the Company. 

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

        “Purchase
Agreement” means the Purchase Agreement dated as of March 30, 2004 among the
Company, Banc of America Securities LLC, Deutsche Bank Securities Inc., Wachovia Capital
Markets, LLC and Robert W. Baird & Co. Incorporated. 

        “Redemption
Date” means the date specified in a notice of redemption on which the Securities
may be redeemed in accordance with the terms of the Securities and this Indenture. 

        “Redemption
Price” or “redemption price” shall have the meaning set forth in
Section 3.01. 

        “Registration
Rights Agreement” means the Registration Rights Agreement, dated as of the date
hereof, between the Company, Banc of America Securities LLC, Deutsche Bank Securities
Inc., Wachovia Capital Markets, LLC and Robert W. Baird & Co. Incorporated. 

5 

        “Representative”
means the (a) indenture trustee or other trustee, agent or representative for any Senior
Debt or (b) with respect to any Senior Debt that does not have any such trustee, agent or
other representative, (i) in the case of such Senior Debt issued pursuant to an agreement
providing for voting arrangements as among the holders or owners of such Senior Debt, any
holder or owner of such Senior Debt acting with the consent of the required persons
necessary to bind such holders or owners of such Senior Debt and (ii) in the case of all
other such Senior Debt, the holder or owner of such Senior Debt. 

        “Responsible
Officer” means, when used with respect to the Trustee, any officer in the
Corporate Trust office or any other officer associated with the corporate trust services
of the Trustee who customarily performs functions similar to those performed by the
persons who at the time shall be such officers, respectively, or to whom any corporate
trust matter is referred because of such person’s knowledge of and familiarity with
the particular subject and who shall have direct responsibility for the administration of
this Indenture. 

        “Restricted
Security” means a Security required to bear the restrictive legend set forth in
the form of Security set forth in Exhibits A and B of this Indenture. 

        “Rule
144A” means Rule 144A under the Securities Act (or any successor provision), as
it may be amended from time to time. 

        “Sale
Price” means, with respect to any security on any day, the closing sale price per
share on such day (or if no closing sale price is reported, the average of the reported
closing bid and ask prices or, if more than one in either case, the average of the average
closing bid and the average closing ask prices) as reported in composite transactions for
the principal United States national or regional securities exchange on which such
security is traded, or if such security is not listed on a United States national or
regional securities exchange, as reported by the National Association of Securities
Dealers Automated Quotation System, or if not so reported, the average of the closing bid
and ask prices of such security on the over-the-counter market on the day in question as
reported by the National Quotation Bureau Incorporated, or, in the absence of such a
quotation, a price determined in good faith by the Board of Directors or, to the extent
permitted by applicable law, a duly authorized committee thereof, whose determination
shall be conclusive. 

        “SEC”
means the Securities and Exchange Commission. 

        “Securities”
means any of the Company’s 2.75% Convertible Senior Subordinated Notes Due 2024, as
amended or supplemented from time to time, issued under this Indenture. 

6 

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

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

        “Senior
Debt” with respect to us means Indebtedness of ours arising under the Credit
Agreement or any other Indebtedness of ours, whether outstanding on the date of this
Indenture or thereafter created, incurred, assumed or guaranteed by us. 

        “Stated
Maturity”, when used with respect to any Security, means March 15, 2024. 

        “Subsidiary”
means (i) a corporation, a majority of whose outstanding Voting Stock is, at the date of
determination, directly or indirectly owned by the Company, by one or more Subsidiaries or
by the Company and one or more Subsidiaries, (ii) a partnership in which the Company or a
Subsidiary holds a majority interest in the equity capital or profits of such partnership,
or (iii) any other Person (other than a corporation) in which the Company, a Subsidiary or
the Company and one or more Subsidiaries, directly or indirectly, at the date of
determination, has (x) at least a majority ownership interest or (y) the power to elect or
direct the election of a majority of the directors or other governing body of such Person. 

        “Tax
Original Issue Discount” means the amount of ordinary interest income on a
Security that must be accrued as original issue discount for United States federal income
tax purposes pursuant to United States Treas. Reg. Sec. 1.1275-4 or any successor
provision. 

        “TIA”
means the Trust Indenture Act of 1939 as in effect on the date of this Indenture,
provided, however, that in the event the TIA is amended after such date, TIA means, to the
extent required by any such amendment, the TIA as so amended. 

        “Trading
Day” means a day during which trading in securities generally occurs on the NYSE
or, if the Common Stock is not listed for trading on the NYSE, on the principal other
national or regional securities exchange on which the Common Stock then is listed or, if
the Common Stock is not listed for trading on a national or regional securities exchange,
on the National Association of Securities Dealers Automated Quotation System or, if the
Common Stock is not quoted on the National Association of Securities Dealers Automated
Quotation System, on the principal other market on which the Common Stock is then traded. 

7 

        “Trading
Price” of the Securities on any Trading Day means the average of the secondary
market bid quotations per Security obtained by the Trustee for $5,000,000 principal amount
of the Securities at approximately 3:30 p.m., New York City time, on such Trading Day from
three independent nationally recognized securities dealers the Company selects,
provided that if at least three such bids cannot reasonably be obtained by the
Trustee, but two such bids can be obtained, then the average of the two bids shall be
used, and if only one such bid can reasonably be obtained by the Trustee, this one bid
shall be used. If the Trustee cannot reasonably obtain at least one bid for $5,000,000
principal amount of the Securities from a nationally recognized securities dealer or in
the Company’s reasonable judgment, the bid quotations are not indicative of the
secondary market value of the Securities, then the trading price per $1,000 principal
amount of the Securities will be deemed to be less than 98% of the Conversion Value for
the Securities on such Trading Day. Notwithstanding the foregoing, the Trustee shall have
no obligation to determine the Trading Price of the Securities unless the Company has
requested such determination. The Company shall have no obligation to make such request
except with respect to the last five Trading Days ending on the third Trading Day
immediately preceding each Measurement Period, commencing with the Measurement Period
beginning March 20, 2009. 

        “Transfer
Restricted Securities” has the meaning specified in the Registration Rights
Agreement. 

        “Trustee”
means the party named as the “Trustee” in the first paragraph of this Indenture
until a successor replaces it pursuant to the applicable provisions of this Indenture and,
thereafter, shall mean such successor. The foregoing sentence shall likewise apply to any
subsequent such successor or successors. 

        “Voting
Stock” of a Person means Capital Stock of such Person of the class or classes
pursuant to which the holders thereof have the general voting power under ordinary
circumstances to elect at least a majority of the board of directors, managers or trustees
of such Person (irrespective of whether or not at the time Capital Stock of any other
class or classes shall have or might have voting power by reason of the happening of any
contingency). 

        Section
1.02  Other Definitions.  

		Defined in
	Terms:	Section
	"Adjustment Event"	10.04(l)
	"Agent Members"	2.12(e)
	"beneficial owner"	3.08(a)
	"cash"	3.01
	"Continuing Directors"	3.08(a)
	"Conversion Agent"	2.03
	"Conversion Value"	10.01(b)
	"Current Market Price"	10.04(h)
	"DTC"	2.01(a)
	"Depositary"	2.01(a)

8 

		Defined in
	Terms:	Section
	"Designated Subsidiary"	6.01
	"Determination Date"	10.04(l)
	"Distributed Assets"	10.04(d)
	"Dividend Threshold Amount"	10.04(e)
	"Event of Default"	6.01
	"Ex-Dividend Time"	10.01(b)
	"Exchange Act"	2.12(e)
	"Expiration Time"	10.04(f)
	"Extraordinary Cash Dividend"	10.04(e)
	"Fair Market Value" or "fair market value"	10.04(h)
	"Fiscal Quarter"	10.01(a)
	"Fundamental Change"	3.08(a)
	"Fundamental Change Purchase Date"	3.08(a)
	"Fundamental Change Purchase Notice"	3.08(c)
	"Fundamental Change Purchase Price"	3.08(a)
	"Institutional Accredited Investors"	2.12(a)(iv)
	"Legal Holiday"	13.08
	"Legend"	2.06(f)
	"Liquidated Damages Notice"	4.07
	"non-electing share"	10.05
	"Non-Payment Default	12.02
	"Notice of Conversion"	10.02(b)
	"Notice of Default"	6.01
	"Paying Agent"	2.03
	"Payment Default"	12.02
	"Purchase Date"	3.07
	"Purchase Notice"	3.07
	"Purchase Price"	3.07
	"Purchased Shares"	10.04(f)
	"QIB"	2.01(a)
	"Record Date"	10.04(h)
	"Registrar"	2.03
	"Rights"	10.10
	"Rights Agreement"	10.10
	"Rule 144A Information"	4.06
	"Spinoff Valuation Period	10.04(d)
	"Trigger Event"	10.04(d)

        Section
1.03. Incorporation By Reference Of Trust Indenture Act. Whenever this Indenture refers
to a provision of the TIA, the provision is incorporated by reference in and made a part
of this Indenture. The following TIA terms used in this Indenture have the following
meanings:  

        “Commission”
means the SEC. 

9 

        “indenture
securities” means the Securities. 

        “indenture security
holder” means a Securityholder. 

        “indenture
to be qualified” means this Indenture. 

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

        “obligor”
on the indenture securities means the Company. 

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

        Section
1.04.   Rules Of Construction.  Unless the context otherwise requires: 

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

	 	(2) 	an
accounting term not otherwise defined has the meaning assigned to it in
               accordance with generally accepted accounting principles as in effect from
time                to time; 

	 	(3) 	“or” is
not exclusive; 

	 	(4) 	“including” means
including, without limitation; and 

	 	(5) 	words
in the singular include the plural, and words in the plural include the
               singular. 

        Section
1.05.        Acts of Holders.  

        (a)              Any
request, demand, authorization, direction, notice, consent, waiver or other
          action provided by this Indenture to be given or taken by Holders may be
          embodied in and evidenced by one or more instruments of substantially similar
          tenor signed by such Holders in person or by an agent duly appointed in
writing;           and, except as herein otherwise expressly provided, such action shall
become           effective when such instrument or instruments are delivered to the
Trustee and,           where it is hereby expressly required, to the Company, as
described in Section           13.02. Such instrument or instruments (and the action
embodied therein and           evidenced thereby) are herein sometimes referred to as the
“Act” of           Holders signing such instrument or instruments. Proof of
execution of any such           instrument or of a writing appointing any such agent
shall be sufficient for any           purpose of this Indenture and conclusive in favor
of the Trustee and the           Company, if made in the manner provided in this Section.  

10 

        (b)              The
fact and date of the execution by any person of any such instrument or           writing
may be proved by the affidavit of a witness of such execution or by a
          certificate of a notary public or other officer authorized by law to take
          acknowledgments of deeds, certifying that the individual signing such
instrument           or writing acknowledged to such officer the execution thereof. Where
such           execution is by a signer acting in a capacity other than such signer’s
          individual capacity, such certificate or affidavit shall also constitute
          sufficient proof of such signer’s authority. The fact and date of the
          execution of any such instrument or writing, or the authority of the person
          executing the same, may also be proved in any other manner which the Trustee
          deems sufficient.  

        (c)              The
principal amount and serial number of any Security and the ownership of
          Securities shall be proved by the register for the Securities.  

        (d)              Any
request, demand, authorization, direction, notice, consent, waiver or other           Act
of the Holder of any Security shall bind every future Holder of the same
          Security and the Holder of every Security issued upon the registration of
          transfer thereof or in exchange therefor or in lieu thereof in respect of
          anything done, omitted or suffered to be done by the Trustee or the Company in
          reliance thereon, whether or not notation of such action is made upon such
          Security.  

        (e)              If
the Company shall solicit from the Holders any request, demand,           authorization,
direction, notice, consent, waiver or other Act, the Company may,           at its
option, by or pursuant to a Board Resolution, fix in advance a record           date for
the determination of Holders entitled to give such request, demand,
          authorization, direction, notice, consent, waiver or other Act, but the Company
          shall have no obligation to do so. If such a record date is fixed, such
request,           demand, authorization, direction, notice, consent, waiver or other Act
may be           given before or after such record date, but only the Holders of record
at the           close of business on such record date shall be deemed to be Holders for
the           purposes of determining whether Holders of the requisite proportion of
          outstanding Securities have authorized or agreed or consented to such request,
          demand, authorization, direction, notice, consent, waiver or other Act, and for
          that purpose the outstanding Securities shall be computed as of such record
          date; provided that no such authorization, agreement or consent by the Holders
          on such record date shall be deemed effective unless it shall become effective
          pursuant to the provisions of this Indenture not later than six months after
the           record date.  

ARTICLE 2 
THE
SECURITIES  

        Section
2.01. Form And Dating. The Securities and the Trustee’s certificate
of authentication shall be substantially in the form of Exhibits A and B, which are a
part of this Indenture. The Securities may have notations, legends or endorsements
required by law, stock exchange rule or usage (provided that any such notation, legend or
endorsement required by usage is in a form acceptable to the Company). The Company shall
provide any such notations, legends or endorsements to the Trustee in writing. Each
Security shall be dated the date of its authentication.  

11 

        (a)    144A
Global Securities. Securities offered and sold within the United           States to
qualified institutional buyers as defined in Rule 144A           (“QIBs”)
in reliance on Rule 144A shall be issued, initially in           the form of a 144A
Global Security, which shall be deposited with the Trustee at           its Corporate
Trust Office, as custodian for the Depositary (as defined below)           and registered
in the name of The Depository Trust Company           (“DTC”) or the
nominee thereof (DTC, or any successor thereto,           and any such nominee being
hereinafter referred to as the           “Depositary”), duly executed by
the Company and authenticated           by the Trustee as hereinafter provided. The
aggregate principal amount of the           144A Global Securities may from time to time
be increased or decreased by           adjustments made on the records of the Trustee and
the Depositary as hereinafter           provided.  

        (b)    Global
Securities in General. Each Global Security shall represent such           of the
outstanding Securities as shall be specified therein and each shall           provide
that it shall represent the aggregate amount of outstanding Securities           from
time to time endorsed thereon and that the aggregate amount of outstanding
          Securities represented thereby may from time to time be reduced or increased,
as           appropriate, to reflect exchanges, redemptions, repurchases and conversions.  

        Any
adjustment of the aggregate principal amount of a Global Security to reflect the amount of
any increase or decrease in the amount of outstanding Securities represented thereby shall
be made by the Trustee in accordance with instructions given by the Holder thereof as
required by Section 2.12 hereof and shall be made on the records of the Trustee and the
Depositary. 

        (c)    Book-Entry
Provisions. This Section 2.01(c) shall apply only to Global           Securities
deposited with or on behalf of the Depositary.  

        The
Company shall execute and the Trustee shall, in accordance with this Section 2.01(c),
authenticate and deliver initially one or more Global Securities that (a) shall be
registered in the name of the Depositary, (b) shall be delivered by the Trustee to the
Depositary or pursuant to the Depositary’s instructions and (c) shall be
substantially in the form of Exhibit A attached hereto. 

        (d)    Certificated
Securities. Securities not issued as interests in the Global           Securities
will be issued in certificated form substantially in the form of           Exhibit B
attached hereto.  

        Section
2.02. Execution And Authentication. The Securities shall be executed on behalf of
the Company by any Officer. The signature of the Officer on the Securities may be manual
or facsimile.  

        Securities
bearing the manual or facsimile signatures of individuals who were at the time of the
execution of the Securities Officers shall bind the Company, notwithstanding that such
individuals or any of them have ceased to hold such offices prior to the authentication
and delivery of such Securities or did not hold such offices at the date of authentication
of such Securities. 

12 

        No
Security shall be entitled to any benefit under this Indenture or be valid or obligatory
for any purpose unless there appears on such Security a certificate of authentication
substantially in the form provided for herein duly executed by the Trustee by manual
signature of an authorized signatory, and such certificate upon any Security shall be
conclusive evidence, and the only evidence, that such Security has been duly authenticated
and delivered hereunder. 

        The
Trustee shall authenticate and deliver the Securities for original issue in an aggregate
principal amount of up to $100,000,000 (up to $115,000,000 aggregate principal amount if
the initial purchasers’ option set forth in the Purchase Agreement is exercised in
full) upon one or more Company Orders without any further action by the Company (other
than as contemplated in Section 13.04Section 13.03 and Section 13.05 hereof). The
aggregate principal amount of the Securities due at the Stated Maturity thereof
outstanding at any time may not exceed the amount set forth in the foregoing sentence. 

        The
Securities shall be issued only in registered form without coupons and only in
denominations of $1,000 of principal amount and any integral multiple of $1,000. 

        Section
2.03. Registrar, Paying Agent And Conversion Agent. The Company shall maintain an
office or agency where Securities may be presented for registration of transfer or for
exchange (“Registrar”), an office or agency where Securities may be
presented for purchase or payment (“Paying Agent”) and an office or
agency where Securities may be presented for conversion (“Conversion Agent”).
The Registrar shall keep a register of the Securities and of their transfer and exchange.
The Company may have one or more co-registrars, one or more additional paying agents and
one or more additional conversion agents. The term Paying Agent includes any additional
paying agent, including any named pursuant to Section 4.05. The term Conversion Agent
includes any additional conversion agent, including any named pursuant to Section 4.05.  

        The
Company shall enter into an appropriate agency agreement with any Registrar, Paying Agent
and Conversion Agent or co-registrar (in each case, if such Registrar, agent or
co-registrar is a Person other than the Trustee). The agreement shall implement the
provisions of this Indenture that relate to such agent. The Company shall notify the
Trustee of the name and address of any such agent. If the Company fails to maintain a
Registrar, Paying Agent or Conversion Agent, the Trustee shall act as such and shall be
entitled to appropriate compensation therefor pursuant to Section 7.07. The Company or any
Subsidiary or an Affiliate of either of them may act as Paying Agent, Registrar,
Conversion Agent or co-registrar. 

13  

        The
Company initially appoints the Trustee as Registrar, Conversion Agent and Paying Agent in
connection with the Securities. 

        Section
2.04. Paying Agent To Hold Money And Securities In Trust. Except as otherwise
provided herein, on or prior to each due date of payments in respect of any Security, the
Company shall deposit with the Paying Agent a sum of money (in immediately available
funds if deposited on the due date) or shares of Common Stock sufficient to make such
payments when so becoming due. The Company shall require each Paying Agent (other than
the Trustee) to agree in writing that the Paying Agent shall hold in trust for the
benefit of Securityholders or the Trustee all money and shares of Common Stock held by
the Paying Agent for the making of payments in respect of the Securities and shall notify
the Trustee of any default by the Company in making any such payment. At any time during
the continuance of any such default, the Paying Agent shall, upon the written request of
the Trustee, forthwith pay to the Trustee all money and shares of Common Stock so held in
trust. If the Company, a Subsidiary or an Affiliate of either of them acts as Paying
Agent, it shall segregate the money and shares of Common Stock held by it as Paying Agent
and hold it as a separate trust fund. The Company at any time may require a Paying Agent
to pay all money and shares of Common Stock held by it to the Trustee and to account for
any funds and Common Stock disbursed by it. Upon doing so, the Paying Agent shall have no
further liability for the money or shares of Common Stock.  

        Section
2.05. Securityholder Lists. The Trustee shall preserve the most recent list
available to it of the names and addresses of Securityholders. If the Trustee is not the
Registrar, the Company shall cause to be furnished to the Trustee at least semiannually
on February 15 and August 15 a listing of Securityholders dated within 15 days of the
date on which the list is furnished and at such other times as the Trustee may request in
writing a list in such form and as of such date as the Trustee may reasonably require of
the names and addresses of Securityholders.  

        Section
2.06. Transfer And Exchange. (a) Subject to Section 2.12 hereof, upon surrender
for registration of transfer of any Security, together with a written instrument of
transfer satisfactory to the Registrar duly executed by the Securityholder or such
Securityholder’s attorney duly authorized in writing, at the office or agency of the
Company designated as Registrar or co-registrar pursuant to Section 2.03, the Company
shall execute, and the Trustee shall authenticate and deliver, in the name of the
designated transferee or transferees, one or more new Securities of any authorized
denomination or denominations, of a like aggregate principal amount. The Company shall
not charge a service charge for any registration of transfer or exchange, but the Company
may require payment of a sum sufficient to pay all taxes, assessments or other
governmental charges that may be imposed in connection with the transfer or exchange of
the Securities from the Securityholder requesting such transfer or exchange.  

14 

        At
the option of the Holder, Securities may be exchanged for other Securities of any
authorized denomination or denominations, of a like aggregate principal amount upon
surrender of the Securities to be exchanged, together with a written instrument of
transfer satisfactory to the Registrar duly executed by the Securityholder or such
Securityholder’s attorney duly authorized in writing, at such office or agency.
Whenever any Securities are so surrendered for exchange, the Company shall execute, and
the Trustee shall authenticate and deliver, the Securities which the Holder making the
exchange is entitled to receive. 

        The
Company shall not be required to make, and the Registrar need not register, transfers or
exchanges of Securities selected for redemption (except, in the case of Securities to be
redeemed in part, the portion thereof not to be redeemed) or any Securities in respect of
which a Purchase Notice or Fundamental Change Purchase Notice has been given and not
withdrawn by the Holder thereof in accordance with the terms of this Indenture (except, in
the case of Securities to be purchased in part, the portion thereof not to be purchased)
or any Securities for a period of 15 days before the mailing of a notice of redemption of
Securities to be redeemed. 

        (b)              Notwithstanding
any provision to the contrary herein, so long as a Global           Security remains
outstanding and is held by or on behalf of the Depositary,           transfers of a
Global Security, in whole or in part, shall be made only in           accordance with
Section 2.12 and this Section 2.06(b). Transfers of a Global           Security shall be
limited to transfers of such Global Security in whole or in           part, to the
Depositary, to nominees of the Depositary or to a successor of the           Depositary
or such successor’s nominee.  

        (c)              Successive
registrations and registrations of transfers and exchanges as           aforesaid may be
made from time to time as desired, and each such registration           shall be noted on
the register for the Securities.  

        (d)              Any
Registrar appointed pursuant to Section 2.03 hereof shall provide to the
          Trustee such information as the Trustee may reasonably require in connection
          with the delivery by such Registrar of Securities upon transfer or exchange of
          Securities.  

        (e)              No
Registrar shall be required to make registrations of transfer or exchange of
          Securities during any periods designated in the text of the Securities or in
          this Indenture as periods during which such registration of transfers and
          exchanges need not be made.  

15 

        (f)              If
Securities are issued upon the transfer, exchange or replacement of           Securities
subject to restrictions on transfer and bearing the legends set forth           on the
forms of Security attached hereto as Exhibits A and B setting forth such
          restrictions (collectively, the “Legend”), or if a request is
          made to remove the Legend on a Security, the Securities so issued shall bear
the           Legend, or the Legend shall not be removed, as the case may be, unless
there is           delivered to the Company and the Registrar such satisfactory evidence,
which           shall include an opinion of counsel, as may be reasonably required by the
          Company and the Registrar and the Trustee (if not the same Person as the
          Trustee), that neither the Legend nor the restrictions on transfer set forth
          therein are required to ensure that transfers thereof comply with the
provisions           of Rule 144A or Rule 144 under the Securities Act or that such
Securities are           not “restricted” within the meaning of Rule 144 under
the Securities           Act. Upon (i) provision of such satisfactory evidence, or (ii)
notification by           the Company to the Trustee and Registrar of the sale of such
Security pursuant           to a registration statement that is effective at the time of
such sale, the           Trustee, at the written direction of the Company, shall
authenticate and deliver           a Security that does not bear the Legend. If the
Legend is removed from the face           of a Security and the Security is subsequently
held by the Company or an           Affiliate of the Company, the Legend shall be
reinstated.  

        Section
2.07. Replacement Securities. If (a) any mutilated Security is surrendered to the
Trustee, or (b) the Company and the Trustee receive evidence to their satisfaction of the
destruction, loss or theft of any Security, and there is delivered to the Company and the
Trustee such security or indemnity as may be required by them to save each of them
harmless, then, in the absence of notice to the Company or the Trustee that such Security
has been acquired by a bona fide purchaser, the Company shall execute and upon its
written request the Trustee shall authenticate and deliver, in exchange for any such
mutilated Security or in lieu of any such destroyed, lost or stolen Security, a new
Security of like tenor and principal amount, bearing a certificate number not
contemporaneously outstanding.  

        In
case any such mutilated, destroyed, lost or stolen Security has become or is about to
become due and payable, or is about to be purchased by the Company pursuant to Article 3
hereof, the Company in its discretion may, instead of issuing a new Security, pay or
purchase such Security, as the case may be. 

        Upon
the issuance of any new Securities under this Section 2.07, 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 Security issued pursuant to this Section 2.07 in lieu of any mutilated, destroyed,
lost or stolen Security shall constitute an original additional contractual obligation of
the Company, whether or not the destroyed, lost or stolen Security shall be at any time
enforceable by anyone, and shall be entitled to all benefits of this Indenture equally and
proportionately with any and all other Securities duly issued hereunder. 

16 

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

        Section
2.08. Outstanding Securities; Determinations Of Holders’ Action. Securities
outstanding at any time are all the Securities authenticated by the Trustee except for
those cancelled by it, those paid pursuant to Section 2.07, those delivered to it for
cancellation and those described in this Section 2.08 as not outstanding. A Security does
not cease to be outstanding because the Company or an Affiliate thereof holds the
Security; provided, however, that in determining whether the Holders of the requisite
principal amount of Securities have given or concurred in any request, demand,
authorization, direction, notice, consent, waiver, or other Act hereunder, Securities
owned by the Company or any other obligor upon the Securities or any Affiliate of the
Company or such other obligor shall be disregarded and deemed not to be outstanding,
except that, in determining whether the Trustee shall be protected in relying upon any
such request, demand, authorization, direction, notice, consent, waiver or other act,
only Securities which a Responsible Officer of the Trustee actually knows to be so owned
shall be so disregarded. Subject to the foregoing, only Securities outstanding at the
time of such determination shall be considered in any such determination (including,
without limitation, determinations pursuant to Articles 6 and 9).  

        If
a Security is replaced pursuant to Section 2.07, it ceases to be outstanding unless the
Trustee receives proof satisfactory to it that the replaced Security is held by a bona
fide purchaser. 

        If
the Paying Agent holds, in accordance with this Indenture, on a Redemption Date, or on the
Business Day following a Purchase Date or a Fundamental Change Purchase Date, or on Stated
Maturity, money or securities, if permitted hereunder, sufficient to pay Securities
payable on that date, then immediately after such Redemption Date, Purchase Date,
Fundamental Change Purchase Date or Stated Maturity, as the case may be, such Securities
shall cease to be outstanding and Interest, Contingent Interest and Liquidated Damages, if
any, on such Securities shall cease to accrue; provided, that if such Securities are to be
redeemed, notice of such redemption has been duly given pursuant to this Indenture or
provision therefor satisfactory to the Trustee has been made. 

        If
a Security is converted in accordance with Article 10, then from and after the time of
conversion on the date of conversion, such Security shall cease to be outstanding and
Interest, Contingent Interest and Liquidated Damages, if any, shall cease to accrue on
such Security. 

        Section
2.09. Temporary Securities. Pending the preparation of definitive Securities, the
Company may execute, and upon Company Order the Trustee shall authenticate and deliver,
temporary Securities which are printed, lithographed, typewritten, mimeographed or
otherwise produced, in any authorized denomination, substantially of the tenor of the
definitive Securities in lieu of which they are issued and with such appropriate
insertions, omissions, substitutions and other variations as the officers executing such
Securities may determine, as conclusively evidenced by their execution of such
Securities.  

17 

        If
temporary Securities are issued, the Company will cause definitive Securities to be
prepared without unreasonable delay. After the preparation of definitive Securities, the
temporary Securities shall be exchangeable for definitive Securities upon surrender of the
temporary Securities at the office or agency of the Company designated for such purpose
pursuant to Section 2.03, without charge to the Holder. Upon surrender for cancellation of
any one or more temporary Securities the Company shall execute and the Trustee shall
authenticate and deliver in exchange therefor a like principal amount of definitive
Securities of authorized denominations. Until so exchanged the temporary Securities shall
in all respects be entitled to the same benefits under this Indenture as definitive
Securities. 

        Section
2.10. Cancellation. All Securities surrendered for payment, purchase by the
Company pursuant to Article 3, conversion, redemption or registration of transfer or
exchange shall, if surrendered to any person other than the Trustee, be delivered to the
Trustee and shall be promptly cancelled by it. The Company may at any time deliver to the
Trustee for cancellation any Securities previously authenticated and delivered hereunder
which the Company may have acquired in any manner whatsoever, and all Securities so
delivered shall be promptly cancelled by the Trustee. The Company may not issue new
Securities to replace Securities it has paid or delivered to the Trustee for cancellation
or that any Holder has converted pursuant to Article 10. No Securities shall be
authenticated in lieu of or in exchange for any Securities cancelled as provided in this
Section, except as expressly permitted by this Indenture. All cancelled Securities held
by the Trustee shall be disposed of by the Trustee in accordance with the Trustee’s
customary procedure.  

        Section
2.11. Persons Deemed Owners. Prior to due presentment of a Security for
registration of transfer, the Company, the Trustee and any agent of the Company or the
Trustee may treat the person in whose name such Security is registered as the owner of
such Security for the purpose of receiving payment of the principal amount of the
Security or any portion thereof, or the payment of any Redemption Price, Purchase Price
or Fundamental Change Purchase Price in respect thereof, and Interest, Contingent
Interest or Liquidated Damages thereon, for the purpose of conversion and for all other
purposes whatsoever, whether or not such Security be overdue, and neither the Company,
the Trustee nor any agent of the Company or the Trustee shall be affected by notice to
the contrary.  

        Section
2.12. Global Securities.  Notwithstanding any other provisions of this Indenture
or the Securities, (A) transfers of a Global Security, in whole or in part, shall be made
only in accordance with Section 2.06 and Section 2.12(a)(i) below, (B) transfers of a
beneficial interest in a Global Security for a Certificated Security shall comply with
Section 2.06, Section 2.12(a)(ii) below and Section 2.12(e)(1) below, and (C) transfers
of a Certificated Security shall comply with Section 2.06 and Sections 2.12(a)(iii) and
2.12(a)(iv) below.  

18 

	 	        (i)    
Transfer of Global Security. A Global Security may not be transferred, in
               whole or in part, to any person other than the Depositary or a nominee or
any                successor thereof, and no such transfer to any such other person may
be                registered; provided that this clause 2.12(a)(i) shall not prohibit any
transfer                of a Security that is issued in exchange for a Global Security
but is not itself                a Global Security. No transfer of a Security to any
person shall be effective                under this Indenture or the Securities unless
and until such Security has been                registered in the name of such person.
Nothing in this Section 2.12(a)(i) shall                prohibit or render ineffective
any transfer of a beneficial interest in a Global                Security effected in
accordance with the other provisions of this Section                2.12(a).  

	 	        (ii)    
Restrictions on Transfer of a Beneficial Interest in a Global Security for a
               Certificated Security. A beneficial interest in a Global Security may
not be                exchanged for a Certificated Security except upon satisfaction of
the                requirements set forth below and in Section 2.12(e)(1) below. Upon
receipt by                the Trustee of a transfer of a beneficial interest in a Global
Security in                accordance with Applicable Procedures for a Certificated
Security in the form                satisfactory to the Trustee, together with:  

	 	        (A)    
               so long as the Securities are Restricted Securities, certification in the
form                set forth in Exhibit C;  

	 	        (B)    
               written instructions to the Trustee to make, or direct the Registrar to
make, an                adjustment on its books and records with respect to such Global
Security to                reflect a decrease in the aggregate principal amount of the
Securities                represented by the Global Security, such instructions to
contain information                regarding the Depositary account to be credited with
such decrease; and  

	 	        (C)    
               if the Company so requests, an opinion of counsel or other evidence
reasonably                satisfactory to it as to the compliance with the restrictions
set forth in the                Legend,  

	 	
then
the Trustee shall cause, or direct the Registrar to cause, in accordance with the
standing instructions and procedures existing between the Depositary and the Registrar,
the aggregate principal amount of the Securities represented by the Global Security to be
decreased by the aggregate principal amount of the Certificated Security to be issued,
shall issue such Certificated Security and shall debit or cause to be debited to the
account of the person specified in such instructions a beneficial interest in the Global
Security equal to the principal amount of the Certificated Security so issued.  

19 

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

	 	        (y)              to
register the transfer of such Certificated Securities; or  

	 	        (z)
                        to exchange such
Certificated Securities for an equal principal amount of           Certificated
Securities of other authorized denominations,  

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

	 	        (1)    
               shall be duly endorsed or accompanied by a written instrument of transfer
in                form reasonably satisfactory to the Company and the Registrar, duly
executed by                the Holder thereof or his attorney duly authorized in writing;
and  

	 	        (2)    
               so long as such Securities are Restricted Securities, such Securities are
being                transferred or exchanged pursuant to an effective registration
statement under                the Securities Act or pursuant to clause (A), (B) or (C)
below, and are                accompanied by the following additional information and
documents, as                applicable:  

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

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

	 	        (C)
    if such Certificated
Securities are being transferred pursuant to an exemption           from registration,
(i) a certification to that effect (in the form set forth in           Exhibit C, if
applicable) and (ii) if the Company so requests, an opinion of           counsel or other
evidence reasonably satisfactory to it as to the compliance           with the
restrictions set forth in the Legend.  

	 	        (iv)    Restrictions
on Transfer of a Certificated Security for a Beneficial Interest                     in a
Global Security. A Certificated Security may not be exchanged for a
                    beneficial interest in a Global Security except upon satisfaction of
the                     requirements set forth below.  

20 

        Upon
receipt by the Trustee of a Certificated Security, duly endorsed or accompanied by
appropriate instruments of transfer, in form satisfactory to the Trustee, together with: 

	 	
(I)    so long as the Securities
are Restricted Securities, certification, in the form           set forth in Exhibit C,
that such Certificated Security (A) is being transferred           to a QIB in accordance
with Rule 144A under the Securities Act or (B) is being           transferred pursuant to
and in compliance with Rule 144 under the Securities           Act; and  

	 	
(II)    written instructions
directing the Trustee to make, or to direct the Registrar           to make, an
adjustment on its books and records with respect to such Global           Security to
reflect an increase in the aggregate principal amount of the           Securities
represented by the Global Security, such instructions to contain           information
regarding the Depositary account to be credited with such increase,           then the
Trustee shall cancel such Certificated Security and cause, or direct           the
Registrar to cause, in accordance with the standing instructions and           procedures
existing between the Depositary and the Registrar, the aggregate           principal
amount of Securities represented by the Global Security to be           increased by the
aggregate principal amount of the Certificated Security to be           exchanged, and
shall credit or cause to be credited to the account of the person           specified in
such instructions a beneficial interest in the Global Security           equal to the
principal amount of the Certificated Security so cancelled. If no           Global
Securities are then outstanding, the Company shall issue and the Trustee           shall
authenticate, upon written order of the Company in the form of an           Officers’ Certificate,
a new Global Security in the appropriate principal           amount.  

        (b)              Subject
to the succeeding Section 2.12(c), every Security shall be subject to           the
restrictions on transfer provided in the Legend including the delivery of an
          opinion of counsel, if so provided. Whenever any Restricted Security is
          presented or surrendered for registration of transfer or for exchange for a
          Security registered in a name other than that of the Holder, such Security must
          be accompanied by a certificate in substantially the form set forth in Exhibit
          C, dated the date of such surrender and signed by the Holder of such Security,
          as to compliance with such restrictions on transfer. The Registrar shall not be
          required to accept for such registration of transfer or exchange any Security
          not so accompanied by a properly completed certificate.  

21 

        (c)    
               The restrictions imposed by the Legend upon the transferability of any
Security                shall cease and terminate when such Security has been sold
pursuant to an                effective registration statement under the Securities Act
or transferred in                compliance with Rule 144 under the Securities Act (or
any successor provision                thereto) or, if earlier, upon the expiration of
the holding period applicable to                sales thereof under Rule 144(k) under the
Securities Act (or any successor                provision). Any Security as to which such
restrictions on transfer shall have                expired in accordance with their terms
or shall have terminated may, upon a                surrender of such Security for
exchange to the Registrar in accordance with the                provisions of this
Section 2.12 (accompanied, in the event that such                restrictions on transfer
have terminated by reason of a transfer in compliance                with Rule 144 or any
successor provision, by an opinion of counsel having                substantial
experience in practice under the Securities Act and otherwise                reasonably
acceptable to the Company, addressed to the Company and in form                acceptable
to the Company, to the effect that the transfer of such Security has                been
made in compliance with Rule 144 or such successor provision), be exchanged
               for a new Security, of like tenor and aggregate principal amount, which
shall                not bear the restrictive Legend. The Company shall inform the
Trustee of the                effective date of any registration statement registering
the Securities under                the Securities Act. The Trustee shall not be liable
for any action taken or                omitted to be taken by it in good faith in
accordance with the aforementioned                opinion of counsel or registration
statement.  

        (d)    
               As used in the preceding two paragraphs of this Section 2.12, the term
               “transfer” encompasses any sale, pledge, transfer, loan,
               hypothecation, or other disposition of any Security.  

        (e)    
               The provisions of clauses (1), (2), (3) and (4) below shall apply only to
Global                Securities:  

	 	(1) 	Notwithstanding
any other provisions of this Indenture or the Securities, a                Global
Security shall not be exchanged in whole or in part for a Security
               registered in the name of any person other than the Depositary or one or
more                nominees thereof, provided that a Global Security may be exchanged
for                Securities registered in the names of any person designated by the
Depositary in                the event that (i) the Depositary has notified the Company
that it is unwilling                or unable to continue as Depositary for such Global
Security or such Depositary                has ceased to be a “clearing agency” registered
under the Securities                Exchange Act of 1934, as amended (the “Exchange
Act”), and a                successor Depositary is not appointed by the Company
within 90 days or (ii) an                Event of Default has occurred and is continuing
with respect to the Securities.                Any Global Security exchanged pursuant to
clause (i) above shall be so exchanged                in whole and not in part, and any
Global Security exchanged pursuant to clause                (ii) above may be exchanged
in whole or from time to time in part as directed by                the Depositary. Any
Security issued in exchange for a Global Security or any                portion thereof
shall be a Global Security; provided that any such Security so                issued that
is registered in the name of a person other than the Depositary or a
               nominee thereof shall not be a Global Security. 

22 

	 	(2) 	Securities
issued in exchange for a Global Security or any portion thereof shall                be
issued in definitive, fully registered form, shall have an aggregate
               principal amount equal to that of such Global Security or portion thereof
to be                so exchanged, shall be registered in such names and be in such
authorized                denominations as the Depositary shall designate and shall bear
the applicable                legends provided for herein. Any Global Security to be
exchanged in whole shall                be surrendered by the Depositary to the Trustee,
as Registrar. With regard to                any Global Security to be exchanged in part,
either such Global Security shall                be so surrendered for exchange or, if
the Trustee is acting as custodian for the                Depositary or its nominee with
respect to such Global Security, the principal                amount thereof shall be
reduced, by an amount equal to the portion thereof to be                so exchanged, by
means of an appropriate adjustment made on the records of the                Trustee.
Upon any such surrender or adjustment, the Trustee shall authenticate                and
deliver the Security issuable on such exchange to or upon the order of the
               Depositary or an authorized representative thereof. 

	 	(3) 	Subject
to the provisions of clause (5) below, the registered Holder may grant
               proxies and otherwise authorize any person, including Agent Members (as
defined                below) and persons that may hold interests through Agent Members,
to take any                action which a holder is entitled to take under this Indenture
or the                Securities. 

	 	(4) 	In
the event of the occurrence of any of the events specified in clause (1)
               above, the Company will promptly make available to the Trustee a
reasonable                supply of Certificated Securities in definitive, fully
registered form. 

	 	(5) 	Neither
any members of, or participants in, the Depositary (collectively, the
               “Agent Members”) nor any other persons on whose behalf
Agent                Members may act shall have any rights under this Indenture with
respect to any                Global Security registered in the name of the Depositary or
any nominee thereof,                or under any such Global Security, and the Depositary
or such nominee, as the                case may be, 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 Security                for all purposes whatsoever.
Notwithstanding the foregoing, nothing herein shall                prevent the Company,
the Trustee or any agent of the Company or the Trustee from                giving effect
to any written certification, proxy or other authorization                furnished by
the Depositary or such nominee, as the case may be, or impair, as                between
the Depositary, its Agent Members and any other person on whose behalf                an
Agent Member may act, the operation of customary practices of such Persons
               governing the exercise of the rights of a holder of any Security. 

23 

        Section
2.13. CUSIP Numbers. The Company may issue the Securities with one or more “CUSIP”numbers
(if then generally in use), and, if so, the Trustee shall use “CUSIP”numbers in
notices of redemption as a convenience to Holders; provided that any such notice may
state that no representation is made as to the correctness of such numbers either as
printed on the Securities or as contained in any notice of a redemption and that reliance
may be placed only on the other identification numbers printed on the Securities, and any
such redemption shall not be affected by any defect in or omission of such numbers. The
Company will promptly notify the Trustee of any change in the CUSIP numbers.  

        Section
2.14. Contingent Debt Tax Treatment. (a) The Company agrees, and by acceptance of
a beneficial interest in a Security, each Holder will be deemed to have agreed to treat
the Security as indebtedness for United States federal income tax purposes that is
subject to the United States federal income tax regulations governing contingent payment
debt instruments. A Holder may obtain the issue price, the amount of Tax Original Issue
Discount, issue date, yield to maturity, comparable yield and projected payment schedule
for the Security, as determined by the Company pursuant to Treas. Reg. Sec. 1.1275-4 or
any successor provision, by submitting a written request to the Company at the following
address: REGAL-BELOIT Corporation, 200 State Street, Beloit, Wisconsin 53511, Attention:
Chief Financial Officer.  

        (b)              Each
Security shall bear a legend relating to United States federal income tax
          matters in the form set forth in Exhibit B.  

        Section
2.15. Calculation Of Tax Original Issue Discount. The Company shall file with the
Trustee promptly at the end of each calendar year (i) a written notice specifying the
amount of Tax Original Issue Discount (including daily rates and accrual periods) accrued
on outstanding Securities as of the end of such year and (ii) such other specific
information relating to such Tax Original Issue Discount as may then be required under
the Internal Revenue Code of 1986, as amended from time to time, or the Treasury
regulations promulgated thereunder.  

ARTICLE 3 
REDEMPTION
AND PURCHASES  

        Section
3.01. Company’s Right To Redeem; Notices To Trustee. Prior to March 20, 2009,
the Securities will not be redeemable at the Company’s option. Beginning on March
20, 2009, the Company, at its option, may redeem the Securities in accordance with the
provisions of Section 5 of the Securities for U.S. legal tender (“cash”)
at any time as a whole, or from time to time in part, at a redemption price (the “Redemption
Price”) equal to the principal amount of the Securities redeemed plus accrued
and unpaid Interest, accrued and unpaid Contingent Interest, if any, and accrued and
unpaid Liquidated Damages, if any, on the Securities redeemed to (but excluding) the
Redemption Date. If the Company elects to redeem Securities pursuant to Section 5 of the
Securities, it shall notify the Trustee in writing of the Redemption Date, the principal
amount of Securities to be redeemed and the Redemption Price.  

24 

        The
Company shall give the notice to the Trustee provided for in this Section 3.01 by a
Company Order, at least 30 days but not more than 60 days before the Redemption Date
(unless a shorter notice shall be satisfactory to the Trustee). 

        Securities
called for redemption may be surrendered for conversion from the date of notice of the
redemption until the close of business on the Business Day immediately preceding the
Redemption Date. 

        Section
3.02. Selection Of Securities To Be Redeemed. If less than all of the Securities
are to be redeemed, unless the procedures of the Depositary provide otherwise, the
Trustee shall select the Securities to be redeemed by lot, on a pro rata basis or by
another method the Trustee considers fair and appropriate (so long as such method is not
prohibited by the rules of any stock exchange on which the Securities are then listed).
The Trustee shall make the selection within five Business Days after it receives the
notice provided for in Section 3.01 from outstanding Securities not previously called for
redemption. The Trustee may select for redemption portions of the principal amount of
Securities that have denominations larger than $1,000.  

        Securities
and portions of Securities that the Trustee selects shall be in principal amounts of
$1,000 or an integral multiple of $1,000. Provisions of this Indenture that apply to
Securities called for redemption also apply to portions of Securities called for
redemption. The Trustee shall notify the Company promptly of the Securities or portions of
the Securities to be redeemed. 

        Securities
and portions of Securities that are to be redeemed are convertible, pursuant to Section
10.01(a)(2), by the Holder until the close of business on the Business Day prior to the
Redemption Date. If any Security selected for partial redemption is converted in part
before termination of the conversion right with respect to the portion of the Security so
selected, the converted portion of such Security shall be deemed (so far as may be) to be
the portion selected for redemption. Securities that have been converted during a
selection of Securities to be redeemed may be treated by the Trustee as outstanding for
the purpose of such selection. 

        Section
3.03. Notice Of Redemption. At least 30 days but not more than 60 days before a
Redemption Date, the Company shall mail a notice of redemption by first-class mail,
postage prepaid, to each Holder of Securities to be redeemed.  

25 

        The
notice shall identify the Securities to be redeemed and shall state: 

	 	(1) 	the
Redemption Date; 

	 	(2) 	the
Redemption Price; 

	 	(3) 	the
Conversion Rate; 

	 	(4) 	the
name and address of the Paying Agent and Conversion Agent; 

	 	(5) 	that
Securities called for redemption may be converted at any time before the
               close of business on the Business Day prior to the Redemption Date; 

	 	(6) 	that
Holders who want to convert their Securities must satisfy the requirements
               set forth in Section 8 of the Securities; 

	 	(7) 	that
Securities called for redemption must be surrendered to the Paying Agent to
               collect the Redemption Price; 

	 	(8) 	if
fewer than all of the outstanding Securities are to be redeemed, the
               certificate numbers, if any, and principal amounts of the particular
Securities                to be redeemed; 

	 	(9) 	that,
unless the Company defaults in making payment of such Redemption Price,
               Interest, Contingent Interest, if any, and Liquidated Damages, if any, on
               Securities called for redemption will cease to accrue on and after the
               Redemption Date; and 

	 	(10) 	the
CUSIP number(s) of the Securities. 

        At
the Company’s request, the Trustee shall give the notice of redemption in the
Company’s name and at the Company’s expense, provided that the Company makes
such request at least seven Business Days prior to the date by which such notice of
redemption must be given to Holders in accordance with this Section 3.03. 

        Section
3.04. Effect Of Notice Of Redemption. Once notice of redemption is given,
Securities called for redemption become due and payable on the Redemption Date and at the
Redemption Price stated in the notice except for Securities which are converted in
accordance with the terms of this Indenture. Upon surrender to the Paying Agent, such
Securities shall be paid at the Redemption Price stated in the notice.  

26 

        Section
3.05. Deposit Of Redemption Price. Prior to 10:00 a.m. (New York City time), on
the Redemption Date, the Company shall deposit with the Paying Agent (or if the Company
or a Subsidiary or an Affiliate of either of them is the Paying Agent, shall segregate
and hold in trust) money sufficient to pay the Redemption Price of all Securities to be
redeemed on that date other than Securities or portions of Securities called for
redemption which on or prior thereto have been delivered by the Company to the Trustee
for cancellation or have been converted. The Paying Agent shall as promptly as
practicable return to the Company any money not required for that purpose because of
conversion of Securities pursuant to Article 10. If such money is then held by the
Company in trust and is not required for such purpose it shall be discharged from such
trust.  

        Section
3.06. Securities Redeemed In Part. Upon surrender of a Security that is redeemed
in part, the Company shall execute and the Trustee shall authenticate and deliver to the
Holder a new Security in an authorized denomination equal in principal amount to the
unredeemed portion of the Security surrendered.  

Section 3.07. Purchase Of
Securities By The Company At Option Of The Holder. Securities shall be purchased by
the Company pursuant to Section 6 of the Securities at the option of the Holder on March
15, 2009, March 15, 2014 and March 15, 2019 (each, a “Purchase Date”), at
a purchase price in cash equal to the principal amount of those Securities, plus accrued
and unpaid Interest, plus accrued and unpaid Contingent Interest, if any, and accrued and
unpaid Liquidated Damages, if any, on those Securities, to (but excluding) such Purchase
Date (the “Purchase Price”). Not later than 20 Business Days prior to any
Purchase Date, the Company shall mail a Company Notice by first class mail to the Trustee
and to each Holder (and to beneficial owners as required by applicable law). The Company
Notice shall include a form of Purchase Notice to be completed by a Holder and shall
state: 

        (i)              the
Purchase Price and the Conversion Rate;  

        (ii)              the
name and address of the Paying Agent and the Conversion Agent;  

        (iii)              that
Securities as to which a Purchase Notice has been given may be converted if
          they are otherwise convertible only in accordance with Article 10 hereof and
          Section 8 of the Securities if the applicable Purchase Notice has been
withdrawn           in accordance with the terms of this Indenture;  

        (iv)              that
Securities must be surrendered to the Paying Agent to collect payment;  

        (v)              that
the Purchase Price for any security as to which a Purchase Notice has been
          given and not withdrawn will be paid promptly following the later of the
          Purchase Date and the time of surrender of such Security as described in (iv);  

27 

        (vi)              the
procedures the Holder must follow to exercise its put rights under Section           3.08
and a brief description of those rights;  

        (vii)              briefly,
the conversion rights, if any, with respect to the Securities;  

        (viii)              the
procedures for withdrawing a Purchase Notice;  

        (ix)              that,
unless the Company defaults in making payment on Securities for which a
          Purchase Notice has been submitted, Interest, Contingent Interest, if any, and
          Liquidated Damages, if any, on such Securities will cease to accrue on and
after           the Purchase Date; and  

        (x)              the
CUSIP number of the Securities.  

        At
the Company’s request, the Trustee shall give such Company Notice in the
Company’s name and at the Company’s expense; provided, however, that, in all
cases, the text of such Company Notice shall be prepared by the Company. 

        Purchases
of Securities hereunder shall be made, at the option of the Holder thereof, upon: 

	 	(1) 	delivery
to the Paying Agent by the Holder of a written notice of purchase (a                “Purchase
Notice”) during the period beginning at any time from                the opening
of business on the date that is 20 Business Days prior to the                relevant
Purchase Date until the close of business on the Business Day prior to
               such Purchase Date stating: 

	 	
(A)    the certificate number of
the Security which the Holder will deliver to be           purchased or the appropriate
Depositary procedures if Certificated Securities           have not been issued for such
Security,  

	 	
(B)    the portion of the
principal amount of the Security which the Holder will           deliver to be purchased,
which portion must be in principal amounts of $1,000 or           an integral multiple of
$1,000, and  

	 	
(C)    that such Security shall be
purchased by the Company as of the Purchase Date           pursuant to the terms and
conditions specified in Section 6 of the Securities           and in this Indenture; and  

	 	(2) 	delivery
of such Security to the Paying Agent at any time after delivery of the
               Purchase Notice (together with all necessary endorsements) at the offices
of the                Paying Agent, such delivery being a condition to receipt by the
Holder of the                Purchase Price therefor; provided, however, that such
Purchase Price shall be so                paid pursuant to this Section 3.07 only if the
Security so delivered to the                Paying Agent shall conform in all respects to
the description thereof in the                related Purchase Notice. 

28 

        The
Company shall purchase from the Holder thereof, pursuant to this Section 3.07, a portion
of a Security, if the principal amount of such portion is $1,000 or an integral multiple
of $1,000. Provisions of this Indenture that apply to the purchase of all of a Security
also apply to the purchase of such portion of such Security. 

        Any
purchase by the Company contemplated pursuant to the provisions of this Section 3.07 shall
be consummated by the delivery of the consideration to be received by the Holder promptly
following the later of the Purchase Date and the time of delivery of the Security. 

        Notwithstanding
anything herein to the contrary, any Holder delivering to the Paying Agent the Purchase
Notice contemplated by this Section 3.07 shall have the right to withdraw such Purchase
Notice at any time prior to the close of business on the Purchase Date by delivery of a
written notice of withdrawal to the Paying Agent in accordance with Section 3.12. 

        The
Paying Agent shall promptly notify the Company of the receipt by it of any Purchase Notice
or written notice of withdrawal thereof. 

        Section
3.08. Purchase Of Securities At Option Of The Holder Upon Fundamental Change.  If
a Fundamental Change occurs (subject to certain exceptions set forth below), the
Securities not previously purchased by the Company shall be purchased by the Company, at
the option of the Holder thereof, at a purchase price in cash equal to the principal
amount of those Securities, plus accrued and unpaid Interest, plus accrued and unpaid
Contingent Interest, if any, and accrued and unpaid Liquidated Damages, if any, on those
Securities (the “Fundamental Change Purchase Price”) to, but not
including, the Fundamental Change Purchase Date, as of the date selected by the Company
that is 30 Business Days after the date of the notice of a Fundamental Change delivered
by the Company pursuant to Section 3.08(b) (the “Fundamental Change Purchase Date”),
subject to satisfaction by or on behalf of the Holder of the requirements set forth in
Section 3.08(c).  

        A
“Fundamental Change” will be deemed to have occurred at such time after
the Securities are originally issued when any of the following events shall occur: 

	 	        (A)    
                    the acquisition by any person, including any syndicate or group
deemed to be a                     “person” under Section 13(d)(3) of the
Exchange Act, of beneficial                     ownership, directly or indirectly through
a purchase, merger or other                     acquisition transaction or series of
purchase, merger or other acquisition                     transactions, of shares of the
Capital Stock of the Company entitling that                     person to exercise 50% or
more of the total voting power of all shares of the                     Capital Stock of
the Company entitled to vote generally in elections of                     directors,
other than any acquisition by the Company, any of its subsidiaries,
                    or any of the employee benefit plans of the Company (except that any
of those                     persons shall be deemed to have beneficial ownership of all
securities it has                     the right to acquire, whether the right is
currently exercisable or is                     exercisable only upon the occurrence of a
subsequent condition); or  

29 

	 	        (B)    
                    the first day on which a majority of the members of the Board of
Directors of                     the Company are not Continuing Directors; or  

	 	        (C)    
                    the Company consolidates or merges with or into any other person, any
merger of                     another person (other than one or more Subsidiaries) into
the Company, or any                     conveyance, sale, transfer or lease of all or
substantially all of the assets of                     the Company to another person
(other than one or more Subsidiaries), other than:                     (A) any
transaction: (1) that does not result in any reclassification,
                    conversion, exchange or cancellation of outstanding shares of the
Company’s                     Capital Stock; and (2) pursuant to which holders of
the Company’s Capital                     Stock immediately prior to the transaction
have the entitlement to exercise,                     directly or indirectly, 50% or more
of the total voting power of all shares of                     Capital Stock entitled to
vote generally in elections of directors of the                     continuing or
surviving Person immediately after giving effect to such issuance;
                    and (B) any merger, share exchange, transfer of assets or similar
transaction                     effected solely for the purpose of changing the Company’s
jurisdiction of                     incorporation and/or form of organization and
resulting in a reclassification,                     conversion or exchange of
outstanding shares of Common Stock, if at all, solely                     into shares of
common stock, ordinary shares or American Depositary Shares or                     other
equity interests of the surviving Person or a direct or indirect parent of
                    the surviving Person.  

	 	        (ii)    
                    Notwithstanding the provisions of Section 3.08(a)(i), the Company
shall not be                     required to purchase the Securities of the Holders upon
a Fundamental Change                     pursuant to this Section 3.08 if (1) the Sale
Price per share of Common Stock                     for any five Trading Days within the
period of 20 consecutive Trading Days (x)                     ending immediately after
the later of the Fundamental Change or the public                     announcement of the
Fundamental Change in the case of a Fundamental Change set                     forth
under clause (A) or (B) of the definition of Fundamental Change above, or
                    (y) ending immediately before the Fundamental Change in the case of a
                    Fundamental Change set forth under clause (C) of the definition of
Fundamental                     Change above, equals or exceeds 105% of the Conversion
Price of the Securities                     in effect on each of those five Trading Days
or (2) at least 90% of the                     consideration in the transaction or
transactions (other than cash payments for                     fractional shares and cash
payments made in respect of dissenters’                    appraisal rights)
constituting a Fundamental Change consists of shares of common                     stock
traded or to be traded immediately following a Fundamental Change on a
                    national securities exchange or the Nasdaq National Market, and, as a
result of                     the transaction or transactions, the Securities become
convertible into that                     common stock (and any rights attached thereto).  

30 

        For
the purposes of this Section 3.08, (x) whether a person is a “beneficial
owner” shall be determined in accordance with Rule 13d-3 under the Exchange Act,
(y) the term “person” includes any syndicate or group that would be deemed to be
a “person” under Section 13(d)(3) of the Exchange Act and (z)
“Continuing Directors” means, as of any date of determination, any member
of the Board of Directors who (1) was a member of such board of directors on the date of
the original issuance of the Securities or (2) was nominated for election or elected to
such Board of Directors with the approval of a majority of the Continuing Directors who
were members of such Board of Directors at the time of such nomination or election. 

        (b)    
                    No later than 30 days after the occurrence of a Fundamental Change,
the Company                     shall mail a Company Notice of the Fundamental Change by
first class mail to the                     Trustee and to each Holder (and to beneficial
owners as required by applicable                     law). The Company Notice shall
include a form of Fundamental Change Purchase                     Notice to be completed
by the Holder and shall state:  

	 	        (i)    
                    briefly, the events causing a Fundamental Change and the date of such
                    Fundamental Change;  

	 	        (ii)    
                    the date by which the Fundamental Change Purchase Notice pursuant to
this                     Section 3.08 must be delivered to the Paying Agent in order for
a Holder to                     exercise the repurchase rights;  

	 	        (iii)    
                    the Fundamental Change Purchase Date;  

	 	        (iv)    
                    the Fundamental Change Purchase Price;  

	 	        (v)    
                    the name and address of the Paying Agent and the Conversion Agent;  

	 	        (vi)    
                    the Conversion Rate;  

31 

	 	        (vii)    
                    that the Securities as to which a Fundamental Change Purchase Notice
has been                     given may be converted if they are otherwise convertible
pursuant to Article 10                     hereof only if the Fundamental Change Purchase
Notice has been withdrawn in                     accordance with the terms of this
Indenture;  

	 	        (viii)    
                    that the Securities must be surrendered to the Paying Agent to
collect payment;  

	 	        (ix)    
                    that the Fundamental Change Purchase Price for any Security as to
which a                     Fundamental Change Purchase Notice has been duly given and
not withdrawn will be                     paid promptly following the later of the
Fundamental Change Purchase Date and                     the time of surrender of such
Security as described in clause (viii);  

	 	        (x)    
                    briefly, the procedures the Holder must follow to exercise rights
under this                     Section 3.08;  

	 	        (xi)    
                    briefly, the conversion rights, if any, on the Securities;  

	 	        (xii)    
                    the procedures for withdrawing a Fundamental Change Purchase Notice;  

	 	        (xiii)    
                    that, unless the Company defaults in making payment of such
Fundamental Change                     Purchase Price, Interest, Contingent Interest and
Liquidated Damages, if any, on                     Securities surrendered for purchase by
the Company will cease to accrue on and                     after the Fundamental Change
Purchase Date; and  

	 	        (xiv)    
                    the CUSIP number(s) of the Securities.  

        At
the Company’s request, the Trustee shall give such Company Notice in the
Company’s name and at the Company’s expense; provided, however, that, in all
cases, the text of such Company Notice shall be prepared by the Company. 

        (c)    
                    A Holder may exercise its rights specified in Section 3.08(a) upon
delivery of a                     written notice of purchase (a “Fundamental
Change Purchase                     Notice”) to the Paying Agent at any time on
or prior to the close of                     business on the Fundamental Change Purchase
Date stating:  

	 	        (i)    
                    the certificate number of the Security which the Holder will deliver
to be                     purchased or the appropriate Depositary procedures if
Certificated Securities                     have not been issued;  

	 	        (ii)    
                    the portion of the principal amount of the Security which the Holder
will                     deliver to be purchased, which portion must be $1,000 or an
integral multiple of                     $1,000;  

32 

	 	        (iii)    
                    that such Security shall be purchased pursuant to the terms and
conditions                     specified in Section 6 of the Securities and in this
Indenture; and  

        The
delivery of such Security to the Paying Agent with the Fundamental Change Purchase Notice
(together with all necessary endorsements) at the offices of the Paying Agent shall be a
condition to the receipt by the Holder of the Fundamental Change Purchase Price therefor;
provided, however, that such Fundamental Change Purchase Price shall be so paid pursuant
to this Section 3.08 only if the Security so delivered to the Paying Agent shall conform
in all respects to the description thereof set forth in the related Fundamental Change
Purchase Notice. 

        The
Company shall purchase from the Holder thereof, pursuant to this Section 3.08, a portion
of a Security if the principal amount of such portion is $1,000 or an integral multiple of
$1,000. Provisions of this Indenture that apply to the purchase of all of a Security also
apply to the purchase of such portion of such Security. 

        Any
purchase by the Company contemplated pursuant to the provisions of this Section 3.08 shall
be consummated by the delivery of the consideration to be received by the Holder on the
Fundamental Change Purchase Date. 

        Notwithstanding
anything herein to the contrary, any Holder delivering to the Paying Agent the Fundamental
Change Purchase Notice contemplated by this Section 3.08(c) shall have the right to
withdraw such Fundamental Change Purchase Notice at any time prior to the close of
business on the Fundamental Change Purchase Date by delivery of a written notice of
withdrawal to the Paying Agent in accordance with Section 3.12. 

        The
Paying Agent shall promptly notify the Company of the receipt by it of any Fundamental
Change Purchase Notice or written withdrawal thereof. 

        Section
3.09. [Reserved.] 

        Section
3.10. [Reserved.] 

        Section
3.11. [Reserved.] 

        Section
3.12. Effect Of Purchase Notice Or Fundamental Change Purchase Notice. (a) Upon
receipt by the Paying Agent of the Purchase Notice or Fundamental Change Purchase Notice
specified in Section 3.07(1) or Section 3.08(c), as applicable, the Holder of the
Security in respect of which such Purchase Notice or Fundamental Change Purchase Notice,
as the case may be, was given shall (unless such Purchase Notice or Fundamental Change
Purchase Notice, as the case may be, is withdrawn as specified in the following two
paragraphs) thereafter be entitled solely to receive the Purchase Price or Fundamental
Change Purchase Price, as the case may be, with respect to such Security. Such Purchase
Price or Fundamental Change Purchase Price shall be paid to such Holder, subject to
receipts of funds and/or securities by the Paying Agent, promptly following the later of
(x) the Purchase Date or the Fundamental Change Purchase Date, as the case may be, with
respect to such Security (provided the conditions in Section 3.07(1) or Section 3.08(c),
as applicable, have been satisfied) and (y) the time of delivery of such Security to the
Paying Agent by the Holder thereof in the manner required by Section 3.07 or Section
3.08(c), as applicable. Securities in respect of which a Purchase Notice or Fundamental
Change Purchase Notice has been given by the Holder thereof may not be converted pursuant
to Article 10 hereof on or after the date of the delivery of such Purchase Notice or
Fundamental Change Purchase Notice unless such Purchase Notice or Fundamental Change
Purchase Notice has first been validly withdrawn as specified in the following two
paragraphs.  

33 

        (b)    
               A Purchase Notice or Fundamental Change Purchase Notice may be withdrawn
by                means of a written notice of withdrawal delivered to the office of the
Paying                Agent in accordance with the Purchase Notice or Fundamental Change
Purchase                Notice, as the case may be, at any time prior to the close of
business on the                Purchase Date or Fundamental Change Purchase Date, as the
case may be,                specifying:  

	 	(1) 	the
certificate number, if any, of the Security in respect of which such notice
               of withdrawal is being submitted, 

	 	(2) 	the
principal amount of the Security with respect to which such notice of
               withdrawal is being submitted, and 

	 	(3) 	the
principal amount, if any, of such Security which remains subject to the
               original Purchase Notice or Fundamental Change Purchase Notice, as the
case may                be, and which has been or will be delivered for purchase by the
Company. 

        (c)    
               There shall be no purchase of any Securities pursuant to Section 3.07 or
3.08 if                there has occurred (prior to, on or after, as the case may be, the
giving, by                the Holders of such Securities, of the required Purchase Notice
or Fundamental                Change Purchase Notice, as the case may be) and is
continuing an Event of                Default (other than a default in the payment of the
Purchase Price or                Fundamental Change Purchase Price, as the case may be,
with respect to such                Securities). The Paying Agent will promptly return to
the respective Holders                thereof any Securities (x) with respect to which a
Purchase Notice or                Fundamental Change Purchase Notice, as the case may be,
has been withdrawn in                compliance with this Indenture, or (y) held by it
during the continuance of an                Event of Default (other than a default in the
payment of the Purchase Price or                Fundamental Change Purchase Price, as the
case may be, with respect to such                Securities) in which case, upon such
return, the Purchase Notice or Fundamental                Change Purchase Notice with
respect thereto shall be deemed to have been                withdrawn.  

34 

        Section
3.13. Deposit Of Purchase Price Or Fundamental Change Purchase Price. Prior to
10:00 a.m. (local time in the City of New York) on the Business Day following the
Purchase Date or the Fundamental Change Purchase Date, as the case may be, the Company
shall deposit with the Trustee or with the Paying Agent (or, if the Company or a
Subsidiary or an Affiliate of either of them is acting as the Paying Agent, shall
segregate and hold in trust as provided in Section 2.04) an amount of cash (in
immediately available funds if deposited on such Business Day), sufficient to pay the
aggregate Purchase Price or Fundamental Change Purchase Price, as the case may be, of all
the Securities or portions thereof which are to be purchased as of the Purchase Date or
Fundamental Change Purchase Date, as the case may be.  

        Section
3.14. Securities Purchased In Part. Any Certificated Security which is to be
purchased only in part shall be surrendered at the office of the Paying Agent (with, if
the Company or the Trustee so requires, due endorsement by, or a written instrument of
transfer in form satisfactory to the Company and the Trustee duly executed by, the Holder
thereof or such Holder’s attorney duly authorized in writing) and the Company shall
execute and the Trustee shall authenticate and deliver to the Holder of such Security,
without service charge, a new Security or Securities, of any authorized denomination as
requested by such Holder in aggregate principal amount equal to, and in exchange for, the
portion of the principal amount of the Security so surrendered which is not purchased.  

        Section
3.15. Covenant To Comply With Securities Laws Upon Purchase Of Securities. When
complying with the provisions of Section 3.07 or 3.08 hereof (provided that such offer or
purchase constitutes an “issuer tender offer” for purposes of Rule 13e-4 (which
term, as used herein, includes any successor provision thereto) under the Exchange Act at
the time of such offer or purchase), and subject to any exemptions available under
applicable law, the Company shall (i) comply with Rule 13e-4 and Rule 14e-1 (or any
successor provision) under the Exchange Act, (ii) file the related Schedule TO (or any
successor schedule, form or report) under the Exchange Act, and (iii) otherwise comply
with all Federal and state securities laws so as to permit the rights and obligations
under Sections 3.07 and 3.08 to be exercised in the time and in the manner specified in
Sections 3.07 and 3.08.  

        Section
3.16. Repayment To The Company. The Trustee and the Paying Agent shall return to
the Company any cash that remains unclaimed as provided in Section 13 of the Securities,
together with interest or dividends, if any, thereon (subject to the provisions of
Section 7.01(f)), held by them for the payment of the Purchase Price or Fundamental
Change Purchase Price, as the case may be; provided, however, that to the extent that the
aggregate amount of cash deposited by the Company pursuant to Section 3.13 exceeds the
aggregate Purchase Price or Fundamental Change Purchase Price, as the case may be, of the
Securities or portions thereof which the Company is obligated to purchase as of the
Purchase Date or Fundamental Change Purchase Date, as the case may be, then, unless
otherwise agreed in writing with the Company, promptly after the Business Day following
the Purchase Date or Fundamental Change Purchase Date, as the case may be, the Trustee
shall return any such excess to the Company together with interest or dividends, if any,
thereon (subject to the provisions of Section 7.01(f)).  

35 

ARTICLE 4 
COVENANTS  

        Section
4.01. Payment of Securities. The Company shall promptly make all payments in
respect of the Securities on the dates and in the manner provided in the Securities or
pursuant to this Indenture. Any amounts of cash in immediately available funds to be
given to the Trustee or Paying Agent, shall be deposited with the Trustee or Paying Agent
by 10:00 a.m., New York City time, by the Company. The principal amount of, and Interest,
Contingent Interest, if any, and Liquidated Damages, if any, on the Securities, and the
Redemption Price, Purchase Price and the Fundamental Change Purchase Price shall be
considered paid on the applicable date due if on such date (or, in the case of a Purchase
Price or Fundamental Change Purchase Price, on the Business Day following the applicable
Purchase Date or Fundamental Change Purchase Date, as the case may be) the Trustee or the
Paying Agent holds, in accordance with this Indenture, cash or securities, if permitted
hereunder, sufficient to pay all such amounts then due.  

        Section
4.02. SEC And Other Reports. The Company shall file with or make available to the
Trustee, within 15 days after it files such annual and quarterly reports, information,
documents and other reports with the SEC, copies of its annual report and of the
information, documents and other reports (or copies of such portions of any of the
foregoing as the SEC may by rules and regulations prescribe) which the Company is
required to file with the SEC pursuant to Section 13 or 15(d) of the Exchange Act. In the
event the Company is at any time no longer subject to the reporting requirements of
Section 13 or 15(d) of the Exchange Act, it shall continue to provide the Trustee with
reports containing substantially the same information as would have been required to be
filed with the SEC had the Company continued to have been subject to such reporting
requirements. In such event, such reports shall be provided at the times the Company
would have been required to provide reports had it continued to have been subject to such
reporting requirements. The Company also shall comply with the other provisions of TIA
Section 314(a). Delivery of such reports, information and documents to the Trustee is for
informational purposes only and the Trustee’s receipt of such shall not constitute
constructive notice of any information contained therein or determinable from information
contained therein, including the Company’s compliance with any of its covenants
hereunder (as to which the Trustee is entitled to rely conclusively on Officers’ Certificates).  

36 

        Section
4.03. Compliance Certificate. The Company shall deliver to the Trustee within 120
days after the end of each fiscal year of the Company (beginning with the fiscal year
ending in December 2004) an Officers’ Certificate, stating whether or not to the
knowledge of the signers thereof, the Company is in default in the performance and
observance of any of the terms, provisions and conditions of this Indenture (without
regard to any period of grace or requirement of notice provided hereunder) and if the
Company shall be in default, specifying all such defaults and the nature and status
thereof of which they may have knowledge.  

        Section
4.04. Further Instruments And Acts. The Company will execute and deliver such
further instruments and do such further acts as may be reasonably necessary or proper to
carry out more effectively the purposes of this Indenture.  

        Section
4.05. Maintenance Of Office Or Agency. The Company will maintain in the Borough of
Manhattan, the City of New York, an office or agency of the Trustee, Registrar, Paying
Agent and Conversion Agent where Securities may be presented or surrendered for payment,
where Securities may be surrendered for registration of transfer, exchange, purchase,
redemption or conversion and where notices and demands to or upon the Company in respect
of the Securities and this Indenture may be served. The office of U.S. Bank National
Association, located at c/o U.S. Bank Trust National Association, 100 Wall Street, Suite
1600, New York, NY 10005, Attention: Corporate Trust Services, shall initially be such
office or agency for all of the aforesaid purposes. The Company shall give prompt written
notice to the Trustee of any change in the location of any such office or agency (other
than a change in the location of the office of the Trustee). If at any time the Company
shall fail to maintain any such required office or agency or shall fail to furnish the
Trustee with the address thereof, such presentations, surrenders, notices and demands may
be made or served at the address of the Trustee set forth in Section 13.02.  

        The
Company may also from time to time designate one or more other offices or agencies where
the Securities may be presented or surrendered for any or all such purposes and may from
time to time rescind such designations; provided, however, that no such designation or
rescission shall in any manner relieve the Company of its obligation to maintain an office
or agency in the Borough of Manhattan, the City of New York, for such purposes. 

37 

        Section
4.06. Delivery Of Certain Information. At any time when the Company is not subject
to Section 13 or 15(d) of the Exchange Act, upon the request of a Holder or any
beneficial owner of Securities or holder or beneficial owner of shares of Common Stock
issued upon conversion thereof, or in accordance with Section 3.08(c), the Company will
promptly furnish or cause to be furnished Rule 144A Information (as defined below) to
such Holder or any beneficial owner of Securities or holder or beneficial owner of shares
of Common Stock, or to a prospective purchaser of any such security designated by any
such holder, as the case may be, to the extent required to permit compliance by such
Holder or holder with Rule 144A under the Securities Act in connection with the resale of
any such security. “Rule 144A Information” shall be such information as
is specified pursuant to Rule 144A(d)(4) under the Securities Act. Whether a person is a
beneficial owner shall be determined by the Company to the Company’s reasonable
satisfaction.  

        Section
4.07. Liquidated Damages Notice. In the event that the Company is required to pay
Liquidated Damages to holders of Securities pursuant to the Registration Rights
Agreement, the Company will provide written notice (“Liquidated Damages Notice”)
to the Trustee of its obligation to pay Liquidated Damages no later than fifteen days
prior to the proposed payment date for the Liquidated Damages, and the Liquidated Damages
Notice shall set forth the amount of Liquidated Damages to be paid by the Company on such
payment date. The Trustee shall not at any time be under any duty to any holder of
Securities to determine the Liquidated Damages, or with respect to the nature, extent or
calculation of the amount of Liquidated Damages when made, or with respect to the method
employed in such calculation of the Liquidated Damages.  

ARTICLE 5 
SUCCESSOR
PERSON  

        Section
5.01. When Company May Merge Or Transfer Assets. The Company shall not consolidate
with or merge with or into any other Person or convey, transfer, sell, lease or otherwise
dispose of all or substantially all of its properties and assets to any person, unless:  

	 	        (a)    
                    either (1) the Company shall be the continuing corporation or (2) the
Person (if                     other than the Company) formed by such consolidation or
into which the Company                     is merged or the Person which acquires by
conveyance, transfer or lease all or                     substantially all of the
properties and assets of the Company (i) shall be a                     corporation
organized and validly existing under the laws of the United States                     or
any State thereof or the District of Columbia and (ii) shall expressly
                    assume, by an indenture supplemental hereto, executed and delivered
to the                     Trustee, in form reasonably satisfactory to the Trustee, all
of the obligations                     of the Company under the Securities and this
Indenture;  

	 	        (b)    
                    immediately after giving effect to such transaction, no Event of
Default, and no                     event that, after notice or lapse of time or both,
would become an Event of                     Default, shall have occurred and be
continuing; and  

38 

	 	        (c)    
                    the Company shall have delivered to the Trustee an Officers’ Certificate
                    and an Opinion of Counsel, each stating that such consolidation,
merger,                     conveyance, transfer or lease and, if a supplemental
indenture is required in                     connection with such transaction, such
supplemental indenture, comply with this                     Article 5 and that all
conditions precedent herein provided for relating to such                     transaction
have been satisfied.  

        For
purposes of the foregoing, the transfer (by lease, assignment, sale or otherwise) of the
properties and assets of one or more Subsidiaries (other than to the Company or another
Subsidiary), which, if such assets were owned by the Company, would constitute all or
substantially all of the properties and assets of the Company, shall be deemed to be the
transfer of all or substantially all of the properties and assets of the Company. 

        The
successor Person formed by such consolidation or into which the Company is merged or the
successor Person to which such conveyance, transfer or lease is made shall succeed to, and
be substituted for, and may exercise every right and power of, the Company under this
Indenture with the same effect as if such successor had been named as the Company herein;
and thereafter, except in the case of a lease and obligations the Company may have under a
supplemental indenture, the Company shall be discharged from all obligations and covenants
under this Indenture and the Securities. Subject to Section 9.06, the Company, the Trustee
and the successor Person shall enter into a supplemental indenture to evidence the
succession and substitution of such successor Person and such discharge and release of the
Company. 

ARTICLE 6 
DEFAULTS AND
REMEDIES  

        Section
6.01. Events Of Default.  So long as any Securities are outstanding, each of the
following shall be an "Event of Default": 

	 	
   (1)    
               following the exercise by the Holder of the right to convert a Security in
               accordance with Article 10 hereof, the Company (x) fails to deliver the
cash, if                any, required to be delivered as part of the applicable
Conversion Settlement                Distribution on the applicable Conversion Settlement
Date or (y) fails to                deliver the Common Stock required to be delivered as
part of the applicable                Conversion Settlement Distribution on the
applicable Conversion Settlement Date                as required pursuant to Section
10.02(e)(ii);  

39 

	 	
   (2)    
               the Company defaults in its obligation to repurchase any Security, or any
               portion thereof, upon the exercise by the Holder of such Holder’s
right to                require the Company to purchase such Securities pursuant to and
in accordance                with Section 3.07 or 3.08 hereof, whether or not prohibited
by Article 12                hereof;  

	 	
   (3)    
               the Company defaults in its obligation to redeem any Security, or any
portion                thereof, called for redemption by the Company pursuant to and in
accordance with                Section 3.01 hereof, whether or not prohibited by Article
12 hereof;  

	 	
   (4)    
               the Company defaults in the payment of the principal amount of any
Security when                the same becomes due and payable at its Stated Maturity or
the payment of any                portion of the principal amount of any Security, when
the same becomes due and                payable, whether or not prohibited by Article 12
hereof;  

	 	
   (5)    
               the Company defaults in the payment of any Interest, Contingent Interest
or                Liquidated Damages when due and payable, and continuance of such
default for a                period of 30 days, whether or not prohibited by Article 12
hereof;  

	 	
   (6)    
               the Company fails to comply with any of its agreements or covenants in the
               Securities or this Indenture (other than those referred to in clause (1)
through                clause (5) above) and such failure continues for 60 days after
receipt by the                Company of a Notice of Default;  

	 	
   (7)    
               a failure to pay when due at maturity or a default, event of default or
other                similar condition or event (however described) that results in the
acceleration                of maturity of any indebtedness for borrowed money of the
Company or any                Designated Subsidiary (including, without limitation, the
Credit Agreement) in                an aggregate amount of $30 million or more, unless
the acceleration is                rescinded, stayed or annulled within 30 days after
written notice of default is                given to the Company by the Trustee or
Holders of not less than 25% in aggregate                principal amount of the
Securities then outstanding;  

	 	
   (8)    
               the entry by a court having jurisdiction in the premises of (i) a decree
or                order for relief in respect of the Company or any of its Subsidiaries
that is a                Designated Subsidiary or any group of two or more Subsidiaries
that, taken as a                whole, would constitute a Designated Subsidiary, in an
involuntary case or                proceeding under any applicable bankruptcy,
insolvency, reorganization or other                similar law or (ii) a decree or order
adjudging the Company or any of its                Subsidiaries that is a Designated
Subsidiary or any group of two or more                Subsidiaries that, taken as a
whole, would constitute a Designated Subsidiary, a                bankrupt or insolvent,
or approving as properly filed a petition seeking                reorganization,
arrangement, adjustment or composition of or in respect of the                Company or
any of its Subsidiaries that is a Designated Subsidiary or any group                of
two or more Subsidiaries that, taken as a whole, would constitute a
               Designated Subsidiary, under any applicable law, or appointing a
custodian,                receiver, liquidator, assignee, trustee, sequestrator or other
similar official                of the Company or of any substantial part of its
property, or ordering the                winding up or liquidation of its affairs, and
the continuance of any such decree                or order for relief or any such other
decree or order described in clause (i) or                (ii) above unstayed and in
effect for a period of 60 consecutive days; and  

40  

	 	
   (9)    
               the commencement by the Company or any of its Subsidiaries that is a
Designated                Subsidiary or any group of two or more Subsidiaries that, taken
as a whole,                would constitute a Designated Subsidiary, of a voluntary case
or proceeding                under any applicable bankruptcy, insolvency, reorganization
or other similar law                or of any other case or proceeding to be adjudicated
a bankrupt or insolvent, or                the written consent by the Company or any of
its Subsidiaries that is a                Designated Subsidiary or any group of two or
more Subsidiaries that, taken as a                whole, would constitute a Designated
Subsidiary, to the entry of a decree or                order for relief in respect of the
Company or any of its Subsidiaries that is a                Designated Subsidiary or any
group of two or more Subsidiaries that, taken as a                whole, would constitute
a Designated Subsidiary, in an involuntary case or                proceeding under any
applicable bankruptcy, insolvency, reorganization or other                similar law or
to the commencement of any bankruptcy or insolvency case or                proceeding
against the Company, or the filing by the Company or any of its
               Subsidiaries that is a Designated Subsidiary or any group of two or more
               Subsidiaries that, taken as a whole, would constitute a Designated
Subsidiary,                of a petition or answer or consent seeking reorganization or
relief under any                applicable law, or the written consent by the Company to
the filing of such                petition or to the appointment of or the taking
possession by a custodian,                receiver, liquidator, assignee, trustee,
sequestrator or other similar official                of the Company or of any
substantial part of its property, or the making by the                Company or any of
its Subsidiaries that is a Designated Subsidiary or any group                of two or
more Subsidiaries that, taken as a whole, would constitute a                Designated
Subsidiary, of an assignment for the benefit of creditors, or the
               admission by the Company or any of its Subsidiaries that is a Designated
               Subsidiary or any group of two or more Subsidiaries that, taken as a
whole,                would constitute a Designated Subsidiary, in writing of its
inability to pay its                debts generally as they become due, or the taking of
corporate action by the                Company or any of its Subsidiaries that is a
Designated Subsidiary or any group                of two or more Subsidiaries that, taken
as a whole, would constitute a                Designated Subsidiary, expressly in
furtherance of any such action.  

        For
the avoidance of doubt, clause (6) above shall not constitute an Event of Default until
the Trustee notifies the Company, or the Holders of at least 25% in aggregate principal
amount of the Securities at the time outstanding notify the Company and the Trustee, of
such default and the Company does not cure such default (and such default is not waived)
within the time specified in clause (6) above after actual receipt of such notice. Any
such notice must specify the default, demand that it be remedied and state that such
notice is a “Notice of Default.” 

41 

        Section
6.02. Acceleration. If an Event of Default (other than an Event of Default
specified in Section 6.01(8) or 6.01(9) with respect to the Company) occurs and is
continuing (the default not having been cured or waived), the Trustee by notice to the
Company, or the Holders of at least 25% in aggregate principal amount of the Securities
at the time outstanding by notice to the Company and the Trustee, may declare the
principal amount of the Securities and any accrued and unpaid Interest, any accrued and
unpaid Contingent Interest, if any, and accrued and unpaid Liquidated Damages, if any, on
all the Securities to be immediately due and payable. Upon such a declaration, such
accelerated amount shall be due and payable immediately. If an Event of Default specified
in Section 6.01(8) or 6.01(9) with respect to the Company occurs and is continuing, the
principal amount of the Securities and any accrued and unpaid Interest, any accrued and
unpaid Contingent Interest, if any, and accrued and unpaid Liquidated Damages, if any, on
all the Securities shall become and be immediately due and payable without any
declaration or other act on the part of the Trustee or any Securityholders. The Holders
of a majority in aggregate principal amount of the Securities at the time outstanding, by
notice to the Trustee (and without notice to any other Securityholder) may rescind an
acceleration and its consequences if the rescission would not conflict with any judgment
or decree and if all existing Events of Default have been cured or waived except
nonpayment of the principal amount of the Securities and any accrued and unpaid Interest,
any accrued and unpaid Contingent Interest, if any, and accrued and unpaid Liquidated
Damages, if any, that have become due solely as a result of acceleration and if all
amounts due to the Trustee under Section 7.07 have been paid. No such rescission shall
affect any subsequent Event of Default or impair any right consequent thereto.  

        Section
6.03. Other Remedies. If an Event of Default occurs and is continuing, the Trustee
may, subject to Article 12, pursue any available remedy to collect the payment of the
principal amount of the Securities and any accrued and unpaid Interest, any accrued and
unpaid Contingent Interest, if any, and accrued and unpaid Liquidated Damages, if any, on
the Securities or to enforce the performance of any provision of the Securities or this
Indenture.  

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

42 

        Section
6.04. Waiver Of Past Defaults. The Holders of a majority in aggregate principal
amount of the Securities at the time outstanding, by notice to the Trustee (and without
notice to any other Securityholder), may waive an existing or past Event of Default and
its consequences except (1) an Event of Default described in Section 6.01 clauses (1)
through (5) or (2) an Event of Default in respect of a provision that under Section 9.02
cannot be amended without the consent of each Securityholder affected. When an Event of
Default is waived, it is deemed cured, but no such waiver shall extend to any subsequent
or other Event of Default or impair any consequent right. This Section 6.04 shall be in
lieu of Section 316(a)1(B) of the TIA and such Section 316(a)1(B) is hereby expressly
excluded from this Indenture, as permitted by the TIA.  

        Section
6.05. Control By Majority. The Holders of a majority in aggregate principal amount
of the Securities at the time outstanding may direct the time, method and place of
conducting any proceeding for any remedy available to the Trustee or of exercising any
trust or power conferred on the Trustee. However, the Trustee may refuse to follow any
direction that conflicts with law or this Indenture or that the Trustee determines in
good faith is unduly prejudicial to the rights of other Securityholders or would involve
the Trustee in personal liability unless the Trustee is offered indemnity satisfactory to
it. This Section 6.05 shall be in lieu of Section 316(a)1(A) of the TIA and such Section
316(a)1(A) is hereby expressly excluded from this Indenture, as permitted by the TIA.  

        Section
6.06. Limitation On Suits.  A Securityholder may not pursue any remedy with
respect to this Indenture or the Securities unless:  

	 	
   (1)    
               the Holder gives to the Trustee written notice stating that an Event of
Default                is continuing;  

	 	
   (2)    
               the Holders of at least 25% in aggregate principal amount of the
Securities at                the time outstanding make a written request to the Trustee
to pursue the remedy;  

	 	
   (3)    
               such Holder or Holders offer to the Trustee security or indemnity
satisfactory                to the Trustee against any loss, liability or expense;  

	 	
   (4)    
               the Trustee does not comply with the request within 60 days after receipt
of                such notice, request and offer of security or indemnity; and  

	 	
   (5)    
               the Holders of a majority in aggregate principal amount of the Securities
at the                time outstanding do not give the Trustee a direction inconsistent
with the                request during such 60-day period.  

43 

        A
Securityholder may not use this Indenture to prejudice the rights of any other
Securityholder or to obtain a preference or priority over any other Securityholder. 

        Section
6.07. Rights Of Holders To Receive Payment. Notwithstanding any other provision of
this Indenture (but subject to Article 12), the right of any Holder to receive payment of
the principal amount of the Securities and any accrued and unpaid Interest, any accrued
and unpaid Contingent Interest, if any, and accrued and unpaid Liquidated Damages, if
any, in respect of the Securities held by such Holder, on or after the respective due
dates expressed in the Securities or any Redemption Date, Purchase Date or Fundamental
Change Purchase Date, and to convert the Securities in accordance with Article 10, or to
bring suit for the enforcement of any such payment on or after such respective dates or
the right to convert, shall not be impaired or affected adversely without the consent of
such Holder.  

        Section
6.08. Collection Suit By Trustee. If an Event of Default described in Section 6.01
clauses (1) through (5) occurs and is continuing, the Trustee may recover judgment in its
own name and as trustee of an express trust against the Company for the whole amount
owing with respect to the Securities and the amounts provided for in Section 7.07.  

        Section
6.09. Trustee May File Proofs Of Claim. In case of the pendency of any
receivership, insolvency, liquidation, bankruptcy, reorganization, arrangement,
adjustment, composition or other judicial proceeding relative to the Company or any other
obligor upon the Securities or the property of the Company or of such other obligor or
their creditors, the Trustee (irrespective of whether the principal amount of the
Securities and any accrued and unpaid Interest, any accrued and unpaid Contingent
Interest, if any, and accrued and unpaid Liquidated Damages, if any, in respect of the
Securities shall then be due and payable as therein expressed or by declaration or
otherwise and irrespective of whether the Trustee shall have made any demand on the
Company for the payment of any such amount) shall, subject to Article 12, be entitled and
empowered, by intervention in such proceeding or otherwise:  

        (a)              to
file and prove a claim for the whole principal amount of the Securities and           any
accrued and unpaid Interest, any accrued and unpaid Contingent Interest, if
          any, and accrued and unpaid Liquidated Damages, if any, and to file such other
          papers or documents as may be necessary or advisable in order to have the
claims           of the Trustee (including any claim for the reasonable compensation,
expenses,           disbursements and advances of the Trustee, its agents and counsel or
any other           amounts due the Trustee under Section 7.07) and of the Holders
allowed in such           judicial proceeding, and  

        (b)              to
collect and receive any moneys or other property payable or deliverable on           any
such claims and to distribute the same; and any custodian, receiver,           assignee,
trustee, liquidator, sequestrator or similar official in any such           judicial
proceeding is hereby authorized by each Holder to make such payments to           the
Trustee and, in the event that the Trustee shall consent to the making of           such
payments directly to the Holders, to pay the Trustee any amount due it for           the
reasonable compensation, expenses, disbursements and advances of the           Trustee,
its agents and counsel, and any other amounts due the Trustee under           Section
7.07.  

44 

        Nothing
herein contained shall be deemed to authorize the Trustee to authorize or consent to or
accept or adopt on behalf of any Holder any plan of reorganization, arrangement,
adjustment or composition affecting the Securities 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 pursuant to this Article 6, it
shall, subject to Article 12, pay out the money in the following order:  

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

        SECOND:
to Securityholders for amounts due and unpaid on the Securities for the principal amount
of the Securities and any accrued and unpaid Interest, any accrued and unpaid Contingent
Interest, if any, and accrued and unpaid Liquidated Damages, if any, as the case may be,
ratably, without preference or priority of any kind, according to such amounts due and
payable on the Securities; and 

        THIRD:
the balance, if any, to the Company. 

        The
Trustee may fix a record date and payment date for any payment to Securityholders pursuant
to this Section 6.10. At least 15 days before such record date, the Trustee shall mail to
each Securityholder and the Company a notice that states the record date, the payment date
and the amount to be paid. 

        Section
6.11. Undertaking For Costs. In any suit for the enforcement of any right or remedy under
this Indenture or in any suit against the Trustee for any action taken or omitted by it
as Trustee, a court in its discretion may require the filing by any party litigant (other
than the Trustee) in the suit of an undertaking to pay the costs of the suit, and the
court in its discretion may assess reasonable costs, including reasonable attorneys’ fees
and expenses, against any party litigant in the suit, having due regard to the merits and
good faith of the claims or defenses made by the party litigant. This Section 6.11 does
not apply to a suit by the Trustee, a suit by a Holder pursuant to Section 6.07, or a
suit by Holders of more than 10% in aggregate principal amount of the Securities at the
time outstanding or a suit by any holder of Senior Debt or Representative. This Section
6.11 shall be in lieu of Section 315(e) of the TIA and such Section 315(e) is hereby
expressly excluded from this Indenture, as permitted by the TIA.  

45 

        Section
6.12. Waiver Of Stay, Extension Or Usury Laws. The Company covenants (to the
extent that it may lawfully do so) that it will not at any time insist upon, or plead, or
in any manner whatsoever claim or take the benefit or advantage of, any stay or extension
law or any usury or other law wherever enacted, now or at any time hereafter in force,
which would prohibit or forgive the Company from paying all or any portion of the
principal amount of the Securities and any accrued and unpaid Interest, any accrued and
unpaid Contingent Interest, if any, and accrued and unpaid Liquidated Damages, if any, on
Securities, as contemplated herein, or which may affect the covenants or the performance
of this Indenture; and the Company (to the extent that it may lawfully do so) hereby
expressly waives all benefit or advantage of any such law, and covenants that it will not
hinder, delay or impede the execution of any power herein granted to the Trustee, but
will suffer and permit the execution of every such power as though no such law had been
enacted.  

ARTICLE 7 
TRUSTEE  

        Section
7.01. Duties Of Trustee.  The duties and responsibilities of the Trustee shall be
as provided by the TIA and as set forth herein. 

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

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

	 	(1) 	the
Trustee need perform only those duties that are specifically set forth in
               this Indenture and no others; and 

	 	(2) 	in
the absence of bad faith on its part, the Trustee may conclusively rely, as
               to the truth of the statements and the correctness of the opinions
expressed                therein, upon certificates or opinions furnished to the Trustee
and conforming                to the requirements of this Indenture, but in the case of
any such certificates                or opinions which by any provision hereof are
specifically required to be                furnished to the Trustee, the Trustee shall
examine the certificates and                opinions to determine whether or not they
conform to the requirements of this                Indenture, but need not confirm or
investigate the accuracy of mathematical                calculations or other facts
stated therein. This Section 7.01(b) shall be in                lieu of Section 315(a) of
the TIA and such Section 315(a) is hereby expressly                excluded from this
Indenture, as permitted by the TIA. 

46 

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

	 	(1) 	this
Section (c) does not limit the effect of Section 7.01(b); 

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

	 	(3) 	the
Trustee shall not be liable with respect to any action it takes or omits to
               take in good faith in accordance with a direction received by it pursuant
to                Section 6.05. 

        Subparagraphs
(c)(1), (2) and (3) shall be in lieu of Sections 315(d)(1), 315(d)(2) and 315(d)(3) of the
TIA and such Sections 315(d)(1), 315(d)(2) and 315(d)(3) are hereby expressly excluded
from this Indenture, as permitted by the TIA. 

        (d)              Every
provision of this Indenture that in any way relates to the Trustee is           subject
to this Section 7.01.  

        (e)              The
Trustee may refuse to perform any duty or exercise any right or power unless           it
receives indemnity satisfactory to it against any loss, liability or expense.  

        (f)              Money
held by the Trustee in trust hereunder need not be segregated from other           funds
except to the extent required by law. The Trustee (acting in any capacity
          hereunder) shall be under no liability for interest on any money received by it
          hereunder unless otherwise agreed in writing with the Company.  

        (g)              No
provision of this Indenture shall require the Trustee to expend or risk its           own
funds or otherwise incur any financial liability in the performance of any           of
its duties hereunder, or in the exercise of any of its rights or powers, if           it
shall have reasonable grounds for believing that repayment of such funds or
          adequate indemnity against such risk or liability is not reasonably assured to
          it.  

        Section
7.02. Rights Of Trustee.  Subject to its duties and responsibilities under the TIA: 

        (a)              the
Trustee may conclusively rely and shall 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 (whether in original
or           facsimile form) believed by it to be genuine and to have been signed or
          presented by the proper party or parties;  

47 

        (b)              whenever
in the administration of this Indenture the Trustee shall deem it           desirable
that a matter be proved or established prior to taking, suffering or           omitting
any action hereunder, the Trustee (unless other evidence be herein           specifically
prescribed) may, in the absence of bad faith on its part,           conclusively rely
upon an Officers’ Certificate;  

        (c)              the
Trustee may execute any of the trusts or powers hereunder or perform any           duties
hereunder either directly or by or through agents or attorneys and the           Trustee
shall not be responsible for any misconduct or negligence on the part of           any
agent or attorney appointed with due care by it hereunder;  

        (d)              the
Trustee shall not be liable for any action taken, suffered, or omitted to be
          taken by it in good faith which it believes to be authorized or within its
          rights or powers conferred under this Indenture;  

        (e)              the
Trustee may consult with counsel selected by it and any advice or Opinion of
          Counsel shall be full and complete authorization and protection in respect of
          any action taken or suffered or omitted by it hereunder in good faith and in
          accordance with such advice or Opinion of Counsel;  

        (f)              the
Trustee shall be under no obligation to exercise any of the rights or powers
          vested in it by this Indenture at the request, order or direction of any of the
          Holders, pursuant to the provisions of this Indenture, unless such Holders
shall           have offered to the Trustee security or indemnity satisfactory to it
against the           costs, expenses and liabilities which may be incurred therein or
thereby;  

        (g)              any
request or direction of the Company mentioned herein shall be sufficiently
          evidenced by a Company Request or Company Order and any resolution of the Board
          of Directors may be sufficiently evidenced by a Board Resolution;  

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

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

48 

        (j)              the
rights, privileges, protections, immunities and benefits given to the           Trustee,
including, without limitation, its right to be indemnified, are           extended to,
and shall be enforceable by, the Trustee in each of its capacities           hereunder,
and to each agent, custodian and other person employed to act           hereunder; and  

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

        Section
7.04. Trustee’s Disclaimer. The Trustee makes no representation as to the
validity or adequacy of this Indenture or the Securities, it shall not be accountable for
the Company’s use or application of the proceeds from the Securities, it shall not
be responsible for any statement in the registration statement for the Securities under
the Securities Act or in any offering document for the Securities, the Indenture or the
Securities (other than its certificate of authentication), or the determination as to
which beneficial owners are entitled to receive any notices hereunder.  

        Section
7.05. Notice Of Defaults. If a default or Event of Default occurs and if it is
known to the Trustee, the Trustee shall give to each Securityholder notice of the default
or Event of Default within 90 days after it occurs or, if later, within 15 days after it
is known to the Trustee, unless such default or Event of Default shall have been cured or
waived before the giving of such notice. Notwithstanding the preceding sentence, except
in the case of a default or Event of Default described in Section 6.01 clauses (1)
through (5), the Trustee may withhold the notice if and so long as a committee of its
Responsible Officers in good faith determines that withholding the notice is in the
interest of the Securityholders. The preceding sentence shall be in lieu of the proviso
to Section 315(b) of the TIA and such proviso is hereby expressly excluded from this
Indenture, as permitted by the TIA.  

        Section
7.06. Reports By Trustee To Holders. Within 60 days after each May 15 beginning
with the May 15 following the date of this Indenture, the Trustee shall mail to each
Securityholder a brief report dated as of such December 31 that complies with TIA Section
313(a), if required by such Section 313(a). The Trustee also shall comply with TIA
Section 313(b).  

49 

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

        Section
7.07. Compensation And Indemnity.  The Company agrees: 

        (a)              to
pay to the Trustee from time to time such compensation as the Company and the
          Trustee shall from time to time agree in writing for all services rendered by
it           hereunder (which compensation shall not be limited (to the extent permitted
by           law) by any provision of law in regard to the compensation of a trustee of
an           express trust);  

        (b)              to
reimburse the Trustee upon its request for all reasonable expenses,
          disbursements and advances incurred or made by the Trustee in accordance with
          any provision of this Indenture (including the reasonable compensation and the
          expenses, advances and disbursements of its agents and counsel), except any
such           expense, disbursement or advance as may be attributable to its own
negligence or           bad faith; and  

        (c)              to
indemnify the Trustee or any predecessor Trustee and their agents for, and to
          hold them harmless against, any loss, damage, claim, liability, cost or expense
          (including reasonable attorney’s fees and expenses, and taxes (other than
          taxes based upon, measured by or determined by the income of the Trustee))
          incurred without negligence or bad faith on its part, arising out of or in
          connection with the acceptance or administration of this trust, including the
          costs and expenses of defending itself against any claim (whether asserted by
          the Company or any Holder or any other person) or liability in connection with
          the exercise or performance of any of its powers or duties hereunder.  

        To
secure the Company’s payment obligations in this Section 7.07, the Trustee shall have
a lien prior to the Securities on all money or property held or collected by the Trustee,
except that held in trust to pay the principal amount of, or the Redemption Price,
Purchase Price, Fundamental Change Purchase Price, Interest, Contingent Interest or
Liquidated Damages, if any, as the case may be, on particular Securities. 

        The
Company’s payment obligations pursuant to this Section 7.07 shall survive the
discharge of this Indenture and the resignation or removal of the Trustee. When the
Trustee incurs expenses after the occurrence of an Event of Default specified in Section
6.01(8) or 6.01(9), the expenses, including the reasonable charges and expenses of its
counsel, are intended to constitute expenses of administration under any bankruptcy law. 

        Section
7.08. Replacement Of Trustee. The Trustee may resign by so notifying the Company;
provided, however, no such resignation shall be effective until a successor Trustee has
accepted its appointment pursuant to this Section 7.08. The Holders of a majority in
aggregate principal amount of the Securities at the time outstanding may remove the
Trustee by so notifying the Trustee and the Company. The Company shall remove the Trustee
if:  

50 

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

	 	(2)	          the
Trustee is adjudged bankrupt or insolvent; 

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

	 	(4)	          the
Trustee otherwise becomes incapable of acting. 

        If
the Trustee resigns or is removed or if a vacancy exists in the office of Trustee for any
reason, the Company shall promptly appoint, by resolution of its Board of Directors, a
successor Trustee. 

        A
successor Trustee shall deliver a written acceptance of its appointment to the retiring
Trustee and to the Company satisfactory in form and substance to the retiring Trustee and
the Company. Thereupon the resignation or removal of the retiring Trustee shall become
effective, and the successor Trustee shall have all the rights, powers and duties of the
Trustee under this Indenture. The successor Trustee shall mail a notice of its succession
to Securityholders. The retiring Trustee shall promptly transfer all property held by it
as Trustee to the successor Trustee, subject to the lien provided for in Section 7.07. 

        If
a successor Trustee does not take office within 30 days after the retiring Trustee resigns
or is removed, the retiring Trustee, the Company or the Holders of a majority in aggregate
principal amount of the Securities at the time outstanding may petition any court of
competent jurisdiction at the expense of the Company for the appointment of a successor
Trustee. 

        If
the Trustee fails to comply with Section 7.10, any Securityholder may petition any court
of competent jurisdiction for the removal of the Trustee and the appointment of a
successor Trustee. 

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

        Section
7.10. Eligibility; Disqualification. The Trustee shall at all times satisfy the
requirements of TIA Sections 310(a)(1) and 310(b). The Trustee (or its parent holding
company) shall have a combined capital and surplus of at least $50,000,000 as set forth
in its most recent published annual report of condition. Nothing herein contained shall
prevent the Trustee from filing with the Commission the application referred to in the
penultimate paragraph of TIA Section 310(b).  

51 

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

ARTICLE 8 
DISCHARGE OF
INDENTURE  

        Section
8.01. Discharge Of Liability On Securities. When (i) the Company delivers to the
Trustee all outstanding Securities (other than Securities replaced or repaid pursuant to
Section 2.07) for cancellation or (ii) all outstanding Securities have become due and
payable and the Company deposits with the Trustee cash sufficient to pay all amounts due
and owing on all outstanding Securities (other than Securities replaced pursuant to
Section 2.07), and if in either case the Company pays all other sums payable hereunder by
the Company, then this Indenture shall, subject to Section 7.07, cease to be of further
effect. Money so held in trust shall not be subject to the subordination provisions of
Article 12. The Trustee shall join in the execution of a document prepared by the Company
acknowledging satisfaction and discharge of this Indenture on demand of the Company
accompanied by an Officers’ Certificate and Opinion of Counsel and at the cost and
expense of the Company.  

        Section
8.02. Repayment To The Company. The Trustee and the Paying Agent shall return to
the Company upon written request any money or securities held by them for the payment of
any amount with respect to the Securities that remains unclaimed for two years, subject
to applicable unclaimed property law. After return to the Company, Holders entitled to
the money or securities must look to the Company for payment as general creditors unless
an applicable abandoned property law designates another person and the Trustee and the
Paying Agent shall have no further liability to the Securityholders with respect to such
money or securities for that period commencing after the return thereof.  

ARTICLE 9 
AMENDMENTS  

        Section
9.01. Without Consent Of Holders.  The Company and the Trustee may amend this
Indenture or the Securities without the consent of any Securityholder to: 

	 	
(a)    
               add to the covenants of the Company for the benefit of the Holders of
               Securities;  

52 

	 	
(b)    
               surrender any right or power herein conferred upon the Company;  

	 	
(c)    
               provide for conversion rights of Holders of Securities if any
reclassification                or change of the Common Stock or any consolidation,
merger or sale of all or                substantially all of the Company’s assets
occurs;  

	 	
(d)    
               provide for the assumption of the Company’s obligations to the
Holders of                Securities in the case of a merger, consolidation, conveyance,
transfer or lease                pursuant to Article 5 hereof;  

	 	
(e)    
               increase the Conversion Rate; provided, however, that such increase in the
               Conversion Rate shall not adversely affect the interests of the Holders of
               Securities (after taking into account tax and other consequences of such
               increase);  

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

	 	
(g)    
               make any changes or modifications necessary in connection with the
registration                of the Securities under the Securities Act as contemplated in
the Registration                Rights Agreement; provided, however, that such action
pursuant to this clause                (g) does not, in the good faith opinion of the
Board of Directors of the Company                (as evidenced by a Board Resolution) and
the Trustee, adversely affect the                interests of the Holders of Securities
in any material respect;  

	 	
(h)    
               cure any ambiguity or to correct or supplement any provision herein which
may be                inconsistent with any other provision herein or which is otherwise
defective;                provided, however, that such action pursuant to this clause (h)
does not, in the                good faith opinion of the Company and the Trustee,
adversely affect the                interests of the Holders of Securities in any
material respect and provided                further that any amendment made solely to
conform the provisions herein to the                description of the Notes in the Final
Offering Memorandum will not be deemed to                adversely affect the interests
of the Holders of Securities;  

	 	
(i)    
add or modify any other provisions herein with respect to matters or questions
               arising hereunder which the Company and the Trustee may deem necessary or
               desirable and which will not adversely affect the interests of the Holders
of                Securities.  

        Section
9.02. With Consent Of Holders. Except as provided below in this Section 9.02, this
Indenture or the Securities may be amended, modified or supplemented, and noncompliance
in any particular instance with any provision of this Indenture or the Securities may be
waived, in each case with the written consent of the Holders of at least a majority of
the principal amount of the Securities at the time outstanding.  

53 

        Without
the written consent or the affirmative vote of each Holder of Securities affected thereby,
an amendment, supplement or waiver under this Section 9.02 may not: 

	 	
(a)    
               change the maturity of any Security, or the payment date of any
installment of                Interest, Contingent Interest or Liquidated Damages payable
on any Security;  

	 	
(b)    
               reduce the principal amount of, or the Interest, or the Contingent
Interest or                Liquidated Damages, payable on, or the Redemption Price,
Purchase Price or                Fundamental Change Purchase Price of, any Security;  

	 	
(c)    
               impair or adversely affect the conversion rights of any Holder of
Securities;  

	 	
(d)    
               change the currency of payment of such Securities or Interest, Contingent
               Interest, Liquidated Damages, Redemption Price, Fundamental Change
Purchase                Price or Purchase Price thereon;  

	 	
(e)    
               alter the manner of calculation or rate of accrual of Interest, Contingent
               Interest or Liquidated Damages, Redemption Price, Fundamental Change
Purchase                Price or Purchase Price on any Security, or extend time for
payment of any                amounts due and payable to the Holders of the Securities;  

	 	
(f)    
               impair the right of any Holder to institute suit for the enforcement of
any                payment or with respect to, or conversion of, any Security;  

	 	
(g)    
               modify the obligation of the Company to maintain an office or agency in
The City                of New York pursuant to Section 4.05  

	 	
(h)    
               adversely affect the purchase right of the Holders of the Securities as
provided                in Article 3 or the right of the Holders of the Securities to
convert any                Security as provided in Article 10, except as otherwise
permitted pursuant to                Article 5 or Section 10.05 hereof;  

	 	
(i)    
               modify the provisions of Article 3 in a manner adverse to the Holders of
the                Securities;  

	 	
(j)    
               modify any of the provisions of this Section, or reduce the percentage of
the                aggregate principal amount of outstanding Securities required to
amend, modify                or supplement the Indenture or the Security or waive an
Event of Default, except                to provide that certain other provisions of this
Indenture cannot be modified or                waived without the consent of the Holder
of each outstanding Security affected                thereby;  

54 

	 	
(k)    
               reduce the percentage of the aggregate principal amount of the outstanding
               Securities the consent of whose Holders is required for any such
supplemental                indenture entered into in accordance with this Section 9.02
or the consent of                whose Holders is required for any waiver provided for in
this Indenture; or  

	 	
(l)    
               modify the subordination provisions of Article 12 in a manner adverse to
the                Holders of Securities;  

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

        After
an amendment under this Section 9.02 becomes effective, the Company shall mail to each
Holder a notice briefly describing the amendment. 

        Nothing
in this Section 9.02 shall impair the ability of the Company and the Trustee to amend this
Indenture or the Securities without the consent of any Securityholder to provide for the
assumption of the Company’s obligations to the Holders of Securities in the case of a
merger, consolidation, conveyance, transfer or lease pursuant to Article 5 hereof. 

        Section
9.03. Compliance With Trust Indenture Act. Every supplemental indenture executed
pursuant to this Article shall comply with the TIA.  

        Section
9.04. Revocation And Effect Of Consents, Waivers And Actions. Until an amendment,
waiver or other action by Holders becomes effective, a consent thereto by a Holder of a
Security hereunder is a continuing consent by the Holder and every subsequent Holder of
that Security or portion of the Security that evidences the same obligation as the
consenting Holder’s Security, even if notation of the consent, waiver or action is
not made on the Security. However, any such Holder or subsequent Holder may revoke the
consent, waiver or action as to such Holder’s Security or portion of the Security if
the Trustee receives the notice of revocation before the date the amendment, waiver or
action becomes effective. After an amendment, waiver or action becomes effective, it
shall bind every Securityholder.  

        Section
9.05. Notation On Or Exchange Of Securities. Securities authenticated and
delivered after the execution of any supplemental indenture pursuant to this Article may,
and shall if required by the Trustee, bear a notation in form approved by the Trustee as
to any matter provided for in such supplemental indenture. If the Company shall so
determine, new Securities so modified as to conform, in the opinion of the Trustee and
the Board of Directors, to any such supplemental indenture may be prepared and executed
by the Company and authenticated and delivered by the Trustee in exchange for outstanding
Securities.  

55 

        Section
9.06. Trustee To Sign Supplemental Indentures. The Trustee shall sign any
supplemental indenture authorized pursuant to this Article 9 if the amendment contained
therein does not affect the rights, duties, liabilities or immunities of the Trustee. If
it does, the Trustee may, but need not, sign such supplemental indenture. In signing such
supplemental indenture the Trustee shall receive, and (subject to the provisions of
Section 7.01) shall be fully protected in relying upon, an Officers’ Certificate and
an Opinion of Counsel stating that such amendment is authorized or permitted by this
Indenture.  

        Section
9.07. Effect Of Supplemental Indentures. Upon the execution of any supplemental
indenture under this Article, this Indenture shall be modified in accordance therewith,
and such supplemental indenture shall form a part of this Indenture for all purposes; and
every Holder of Securities theretofore or thereafter authenticated and delivered
hereunder shall be bound thereby.  

ARTICLE 10 
CONVERSIONS  

        Section
10.01. Conversion Privilege.  Subject to and upon compliance with the provisions
of this Article 10 (including without limitation the Company’s right, in its sole
and absolute discretion, to satisfy its Conversion Obligation in any manner permitted
pursuant to Section 10.03), a Holder of a Security shall have the right, at such Holder’s
option, to convert all or any portion (if the portion to be converted is $1,000 principal
amount or an integral multiple thereof) of such Security at any time prior to the close
of business on the Stated Maturity into shares of Common Stock at the Conversion Rate in
effect on the date of conversion:  

	 	        (1)    
                    during any fiscal quarter of the Company (a “Fiscal Quarter”),
                    if the Sale Price of the Common Stock for 20 of the last 30 Trading
Days of the                     immediately preceding Fiscal Quarter was 130% or more of
the Conversion Price in                     effect on such Trading Day;  

	 	        (2)    
                    during the five Business Day period after any five consecutive
Trading Day                     period in which the Trading Price per $1,000 principal
amount of the Securities                     for each day of such five Trading Day period
was less than 98% of the product of                     the Sale Price and the Conversion
Rate; provided that if on the date of                     any conversion pursuant
to this clause Error! Bookmark not defined. the Sale Price is greater than
100% but less than 130% of the                     Conversion Price, a holder shall
receive, in lieu of Common Stock based on the                     Conversion Price, cash
or Common Stock or a combination of cash and Common                     Stock, at the
Company’s option, with a value equal to the principal amount                     of
the holder’s Securities plus accrued interest as of the Conversion Date
                    (a “Principal Value Conversion”);  

56 

	 	        (3)    
                    at any time prior to the close of business on the Business Day
preceding the                     date fixed for redemption, if such Security has been
called for redemption                     pursuant to Article 3 hereof; or  

	 	        (4)    
                    as provided in Section (b) of this Section 10.01.  

        The
Company or a designated agent shall determine on a daily basis (subject to the limitation
contained in the last sentence of the definition of Trading Price) whether the Securities
shall be convertible as a result of the occurrence of an event specified in clause (1)
above and, if the Securities shall be so convertible, the Company shall promptly deliver
to the Trustee and Conversion Agent written notice thereof. Whenever the Securities shall
become convertible pursuant to this Section 10.01, the Company or, at the Company’s
request, the Trustee in the name and at the expense of the Company, shall promptly notify
the Holders of the event triggering such convertibility in the manner provided in Section
13.02, and the Company shall also promptly publicly announce such information through Dow
Jones & Company, Inc. or Bloomberg Business News and publish it on the Company’s
Web site. Any notice so given shall be conclusively presumed to have been duly given,
whether or not the Holder receives such notice. 

        (b)    
               In addition, in the event that:  

	 	        (1)    
               (i) the Company distributes to all holders of Common Stock rights
entitling them                to purchase, for a period expiring within forty-five (45)
days after the date                fixed for determination of stockholders entitled to
receive such rights, Common                Stock at less than the Sale Price of the
Common Stock on the last Trading Day                preceding the declaration for such
distribution; or (ii) the Company elects to                distribute to all holders of
Common Stock, cash or other assets, debt securities                or rights to purchase
the Company’s securities, which distribution has a                per share value as
determined by the Board of Directors exceeding 10% of the                Sale Price of
the Common Stock for the last Trading Day preceding the                declaration for
such distribution, then, in each case, the Securities may be                surrendered
for conversion at any time on and after the date that the Company                gives
notice to the Holders of such right, which shall be not less than 20 days
               prior to the Ex-Dividend Time for such distribution, until the earlier of
the                close of business on the Business Day immediately preceding the
Ex-Dividend Time                or the date the Company announces that such distribution
will not take place.  

57 

	 	        (2)    
               the Company becomes a party to a consolidation, merger or sale of all or
               substantially all of the Company’s assets or a Fundamental Change
occurs                pursuant to which the Common Stock would be converted into cash,
stock or other                property unless all of the consideration, excluding cash
payments for fractional                shares and cash payments made pursuant to
dissenters’ appraisal rights, in                a merger or consolidation otherwise
constituting a Fundamental Change consists                of shares of common stock,
depositary receipts or other certificates                representing common equity
interests traded on a national securities exchange or                quoted on the Nasdaq
National Market, or will be so traded immediately following                such merger or
consolidation, and as a result of such merger or consolidation                the
Securities become convertible solely into such common stock, depositary
               shares or other securities representing common equity interests, then the
               Securities may be surrendered for conversion at any time from and after
the date                which is 15 days prior to the date announced by the Company as
the anticipated                effective time of such transaction until 15 days after the
actual date of such                transaction, or if the transaction also constitutes a
Fundamental Change until                the Fundamental Change Date, and, at such
effective time, the right to convert                the Securities into shares of Common
Stock shall be changed, as set forth in                Section 10.05, into a right to
convert into the kind and amount of such cash,                securities or other
property which the Holder of such Securities would have                received if such
Holder had converted the Securities immediately prior to such                transaction.  

        The
“Conversion Value” for the Securities is equal to the product of (i) the
Sale Price of the Common Stock on a given day and (ii) the then current Conversion Rate. 

        “Ex-Dividend
Time” means, with respect to any issuance or distribution on shares of Common
Stock, the first date on which the shares of Common Stock trade regular way on the
principal securities market on which the shares of Common Stock are then traded without
the right to receive such issuance or distribution. 

        Section
10.02. Conversion Procedure; Conversion Price; Fractional Shares.  

        (a)              Subject
to the Company’s rights under Section 10.03, each Security shall be
          convertible at the office of the Conversion Agent into fully paid and
          nonassessable (except as provided in Section 180.0622(2)(b) of the Wisconsin
          Business Corporation Law, as such statutory provision has been or may be
          judicially interpreted) shares (calculated to the nearest 1/100th of a share)
of           Common Stock. The rate at which shares of Common Stock shall be delivered
upon           conversion (the “Conversion Rate”) shall be initially
39.1179           shares of Common Stock for each $1,000 principal amount of Securities.
The           Conversion Rate shall be adjusted in certain instances as provided in
Section           10.04 hereof, but shall not be adjusted for any accrued and unpaid
Interest,           Contingent Interest, or Liquidated Damages, if any. Upon conversion,
no payment           shall be made by the Company with respect to any accrued and unpaid
Interest, if           any. Instead, such amount shall be deemed paid by the applicable
Conversion           Settlement Distribution delivered upon conversion of any Security.
In addition,           no payment or adjustment shall be made in respect of dividends on
the Common           Stock with a record date prior to the Conversion Date. The Company
shall not           issue any fraction of a share of Common Stock in connection with any
conversion           of Securities, but instead shall, subject to Section 10.04 hereof,
make a cash           payment (calculated to the nearest cent) equal to such fraction
multiplied by           the Sale Price of the Common Stock on the Trading Day prior to
the Conversion           Settlement Date.  

58 

        (b)              Before
any Holder of a Security shall be entitled to convert the same into           Common
Stock, such Holder shall (1) in the case of Global Securities, comply           with the
procedures of the Depositary in effect at that time, and in the case of
          Certificated Securities, surrender such Securities, duly endorsed to the
Company           or in blank, at the office of the Conversion Agent, and (2) give
written notice           to the Company in form on reverse of such Certificated Security
(a           “Notice of Conversion”) at said office or place that such
          Holder elects to convert the same and shall state in writing therein the
          principal amount of Securities to be converted and the name or names (with
          addresses) in which such Holder wishes the certificate or certificates for
          Common Stock included in the Conversion Settlement Distribution, if any, to be
          registered.  

        Before
any such conversion, a Holder also shall pay all taxes or duties, if any, as provided in
Section 10.06 and any amount payable pursuant to Section 10.02(h). 

        If
more than one Security shall be surrendered for conversion at one time by the same Holder,
the number of full shares of Common Stock, if any, that shall be deliverable upon
conversion as part of the Conversion Settlement Distribution shall be computed on the
basis of the aggregate principal amount of the Securities (or specified portions thereof
to the extent permitted thereby) so surrendered. 

        (c)              A
Security shall be deemed to have been converted as of the close of business on
          the date (the “Conversion Date”) that is the latest of Error!
Bookmark not defined. the date the Holder has complied with           Section
10.02(b), Error! Bookmark not defined. the expiration of the Cash
          Settlement Notice Period or Error! Bookmark not defined. if the Company
          elects to pay cash in lieu of Common Stock pursuant to Section 10.03, the
          expiration of the Conversion Retraction Period.  

        (d)              In
the case of a Principal Value Conversion, a holder will receive either cash,
          Common Stock or a combination of cash and Common Stock, at the Company’s
          option, with a value equal to the principal amount of the Security converted
          plus accrued interest, as of the conversion date. If a holder surrenders its
          Securities for conversion and it is a Principal Value Conversion, the Company
          will notify the holder by the second Trading Day following the conversion date
          whether it will pay all or a portion of the principal amount plus accrued and
          unpaid interest in cash, Common Stock or a combination of cash and Common
Stock,           and in what percentage. Any Common Stock delivered upon a Principal
Value           Conversion will be valued at the greater of (x) the Conversion Price on
the           conversion date and (y) the applicable stock price as of the Conversion
Date.           For purposes of this Section 10.02, the “applicable stock
          price” means, in respect of a date of determination, the average of
the           Closing Sale Price per share of Common Stock over the five Trading Day
period           starting the third Trading Day following such date of determination.  

59 

        (e)              Subject
to the next succeeding sentence, the Company will, as soon as           practicable
following the Conversion Settlement Date, Error! Bookmark not           defined. pay
the cash component (including cash in lieu of any fraction of a           share to which
such Holder would otherwise be entitled), if any, of the           Conversion Settlement
Distribution determined pursuant to Section 10.03 to the           Holder of a Security
surrendered for conversion, or such Holder’s nominee           or nominees, and
issue, or cause to be issued, and deliver to the Conversion           Agent or to such
Holder, or such Holder’s nominee or nominees, certificates           for the number
of full shares of Common Stock, if any, to which such Holder           shall be entitled
as part of such Conversion Settlement Distribution. The           Company shall not be
required to deliver certificates for shares of Common Stock           while the stock
transfer books for such stock or the security register are duly           closed for any
purpose, but certificates for shares of Common Stock shall be           issued and
delivered as soon as practicable after the opening of such books or           security
register, and the Person or Persons entitled to receive the Common           Stock as
part of the applicable Conversion Settlement Distribution upon such           conversion
shall be treated for all purposes as the record holder or holders of           such
Common Stock, as of the close of business on the applicable Conversion
          Settlement Date.  

        (f)              In
case any Security shall be surrendered for partial conversion, the Company
          shall execute and the Trustee shall authenticate and deliver to or upon the
          written order of the Holder of the Security so surrendered, without charge to
          such Holder (subject to the provisions of Section 10.06 hereof), a new Security
          or Securities in authorized denominations in an aggregate principal amount
equal           to the unconverted portion of the surrendered Securities.  

        (g)              By
delivering the applicable Conversion Settlement Distribution upon conversion           of
any Security to the Conversion Agent or to the Holder or such Holder’s
          nominee or nominees, the Company will have satisfied in full its Conversion
          Obligation with respect to such Security, and upon such delivery accrued and
          unpaid Interest and Contingent Interest, if any, with respect to such Security
          will be deemed to be paid in full rather than canceled, extinguished or
          forfeited.  

        (h)              If
a Securityholder delivers a Notice of Conversion after the Interest Record           Date
for a payment of Interest but prior to the corresponding Interest Payment           Date,
such Securityholder must pay to the Company, at the time such           Securityholder
surrenders Securities for conversion, an amount equal to the           Interest, that has
accrued and will be paid on the related Interest Payment           Date. This Section
10.02(h) shall not apply to a Securityholder that converts           Securities after an
Interest Record Date for a payment of Interest but on or           prior to the
corresponding Interest Payment Date if (1) the Company has           specified a
Redemption Date during such period, (2) the Company has specified a           Fundamental
Change Purchase Date during such period or (3) any overdue Interest           exists at
the time of conversion with respect to the Securities converted.
          Notwithstanding the foregoing, the Company shall refund any amount paid by a
          Securityholder pursuant to this Section 10.02(h) if the Cash Settlement Notice
          Period or, if the Company elects to pay cash in lieu of Common Stock pursuant
to           Section 10.03, the Cash Settlement Averaging Period, ends on or subsequent
to           the Interest Payment Date immediately following the date such Securityholder
          delivered a Notice of Conversion. Such refunded amount shall be paid at the
time           of delivery of the Conversion Settlement Distribution following conversion
of           any Securities.  

60 

        Section
10.03. Payment Of Cash In Lieu Of Common Stock.  

        (a)    
                    If a Holder elects to convert all or any portion of a Security into
shares of                     Common Stock as set forth in Section 10.01 and the Company
receives such                     Holder’s Notice of Conversion on or prior to the
day that is 20 days prior                     to the Stated Maturity, or with respect to
Securities called for redemption                     pursuant to Section 3.01, the
applicable Redemption Date (the “Final                     Notice Date”),
the Company may choose to satisfy all or any portion of                     its
Conversion Obligation in cash. Upon such election, the Company will notify
                    such Holder through the Trustee of the dollar amount to be satisfied
in cash                     (which must be expressed either as 100% of the Conversion
Obligation or as a                     fixed dollar amount) at any time on or before the
date that is two Business Days                     following the Company’s receipt
of the Notice of Conversion as specified in                     Section 10.02 (such
period, the “Cash Settlement Notice                     Period”). If the
Company elects to pay cash for any portion of the                     shares otherwise
issuable to the Holder, the Holder may retract the Notice of
                    Conversion at any time during the two Business Day period beginning
on the day                     after the final day of the Cash Settlement Notice Period
(the                     “Conversion Retraction Period”); no such
retraction can be made                     (and a Notice of Conversion shall be
irrevocable) if the Company does not elect                     to deliver cash in lieu of
shares of Common Stock (other than cash in lieu of                     fractional
shares). With respect to any Notice of Conversion received by the
                    Company prior to the Final Notice Date, the “Conversion
Settlement                     Distribution” for any Security subject to such
Notice of Conversion                     shall consist of cash, Common Stock or a
combination thereof, as selected by the                     Company as set forth below:  

	 	        (i)    
                    if the Company elects to satisfy the entire Conversion Obligation in
shares of                     Common Stock, the Conversion Settlement Distribution shall
be a number of shares                     equal to (1) the aggregate original principal
amount at maturity of the                     Securities to be converted divided by
1,000, multiplied by (2) the Conversion                     Rate; provided that if on the
date a Holder submits the Notice of Conversion                     such Holder holds
Transfer Restricted Securities and there exists a Registration
                    Default affecting the Common Stock, for purposes of this Section
10.03(a)(i) and                     Section 10.03(a)(iii), the Conversion Rate shall be
multiplied by 1.03.  

61 

	 	        (ii)    
                    if the Company elects to satisfy the entire Conversion Obligation in
cash, the                     Conversion Settlement Distribution shall be cash in an
amount equal to the                     product of:  

	 	        (1)    
                    a number equal to the
product of (x) the aggregate principal amount of           Securities to be converted
divided by 1,000 multiplied by (y) the Conversion           Rate, and  

	 	        (2)    
                    the average Sale Price of
the Common Stock during the 20 Trading Days beginning           on the Trading Day
immediately following the final day of the Conversion           Retraction Period (the
“Cash Settlement Averaging Period”); and  

	 	        (iii)    
                    if the Company elects to satisfy a fixed portion (other than 100%) of
the                     Conversion Obligation in cash, the Conversion Settlement
Distribution shall                     consist of such cash amount (“Cash Amount”)
and a number of                     shares equal to the greater of (1) zero and (2) the
excess, if any, of the                     number of shares calculated as set forth in
clause (i) above over the number of                     shares equal to the sum, for each
day of the Cash Settlement Averaging Period,                     of (x) 5% of the Cash
Amount, divided by (y) the Sale Price of the Common Stock                     on such
day.  

        (b)              At
any time on or before any Final Notice Date, the Company will notify the
          Trustee whether it intends to satisfy all or any portion of the Conversion
          Obligation with respect to conversions of Securities for which the Company
          receives a Notice of Conversion after such Final Notice Date and the dollar
          amount to be satisfied in cash (which must be expressed either as 100% or as a
          fixed dollar amount). In such case, the applicable Conversion Settlement
          Distribution will be computed in the same manner as set forth in clause (a)
          above except that the Cash Settlement Averaging Period shall be the 20 Trading
          Days beginning on the first Trading Day following the Company’s receipt of
          the Notice of Conversion.  

        SECTION
10.04. Adjustment of Conversion Rate.  The Conversion Rate shall be adjusted from
time to time by the Company as follows: 

        (a)
                    In case the Company shall hereafter pay a dividend or make a
distribution to all                     holders of the outstanding Common Stock in shares
of Common Stock, the                     Conversion Rate shall be increased so that the
same shall equal the rate                     determined by dividing the Conversion Rate
in effect at the opening of business                     on the date following the date
fixed for the determination of stockholders                     entitled to receive such
dividend or other distribution by a fraction,  

62 

	 	        (i)    
                    the numerator of which shall be the number of shares of the Common
Stock                     outstanding at the close of business on the date fixed for such
determination;                     and  

	 	        (ii)    
                    the denominator of which shall be the sum of such number of shares
and the total                     number of shares constituting such dividend or other
distribution,  

such increase to become effective
immediately after the opening of business on the day following the date fixed for such
determination. For the purpose of this paragraph (a), the number of shares of Common Stock
at any time outstanding shall not include shares held in the treasury of the Company. The
Company will not pay any dividend or make any distribution on shares of Common Stock held
in the treasury of the Company. If any dividend or distribution of the type described in
this Section 10.04(a) is declared but not so paid or made, the Conversion Rate shall again
be adjusted to the Conversion Rate that would then be in effect if such dividend or
distribution had not been declared. 

        (b)    
                    In case the Company shall issue rights (excluding any Rights pursuant
to the                     Rights Agreement) or warrants to all holders of its
outstanding shares of Common                     Stock entitling them (for a period
expiring within forty-five (45) days after                     the date fixed for
determination of stockholders entitled to receive such rights                     or
warrants) to subscribe for or purchase shares of Common Stock at a price per
                    share less than the closing price per share of the Common Stock on
the date                     fixed for determination of stockholders entitled to receive
such rights or                     warrants, the Conversion Rate shall be adjusted so
that the same shall equal the                     rate determined by dividing the
Conversion Rate in effect immediately prior to                     the date fixed for
determination of stockholders entitled to receive such rights                     or
warrants by a fraction,  

	 	        (i)    
                    the numerator of which shall be the number of shares of Common Stock
outstanding                     at the close of business on the date fixed for
determination of stockholders                     entitled to receive such rights or
warrants plus the number of shares that the                     aggregate offering price
of the total number of shares so offered would purchase                     at the
closing price per share of the Common Stock on such date, and  

	 	        (ii)    
                    the denominator of which shall be the number of shares of Common
Stock                     outstanding on the date fixed for determination of stockholders
entitled to                     receive such rights or warrants plus the total number of
additional shares of                     Common Stock offered for subscription or
purchase.  

63 

        Such
adjustment shall be successively made whenever any such rights or warrants are issued, and
shall become effective immediately after the opening of business on the day following the
date fixed for determination of stockholders entitled to receive such rights or warrants.
In the event that such rights or warrants are not so issued, the Conversion Rate shall
again be adjusted to be the Conversion Rate that would then be in effect if such date
fixed for the determination of stockholders entitled to receive such rights or warrants
had not been fixed. In determining whether any rights or warrants entitle the holders to
subscribe for or purchase shares of Common Stock at less than such current market price,
and in determining the aggregate offering price of such shares of Common Stock, there
shall be taken into account any consideration received by the Company for such rights or
warrants and any amount payable on exercise or conversion thereof, the value of such
consideration, if other than cash, to be determined by the Board of Directors. 

        (c)    
                    In case outstanding shares of Common Stock shall be subdivided into a
greater                     number of shares of Common Stock, the Conversion Rate in
effect at the opening                     of business on the day following the day upon
which such subdivision becomes                     effective shall be proportionately
increased, and conversely, in case                     outstanding shares of Common Stock
shall be combined into a smaller number of                     shares of Common Stock,
the Conversion Rate in effect at the opening of business                     on the day
following the day upon which such combination becomes effective shall
                    be proportionately reduced, such increase or reduction, as the case
may be, to                     become effective immediately after the opening of business
on the day following                     the day upon which such subdivision or
combination becomes effective.  

        (d)    
                    In case the Company shall, by dividend or otherwise, distribute to
all holders                     of its Common Stock shares of any class of Capital Stock
of the Company or                     evidences of its indebtedness or assets (including
securities, but excluding any                     rights or warrants referred to in
Section 10.04(b) and excluding any dividend or                     distribution (x) paid
exclusively in cash or (y) referred to in Section                     10.04(a)) (any of
the foregoing hereinafter in this Section 10.04(d) called the                     “Distributed
Assets”), then, in each such case, the Conversion                     Rate shall
be adjusted so that the same shall be equal to the rate determined by
                    multiplying the Conversion Rate in effect on the Record Date with
respect to                     such distribution by a fraction,  

	 	        (i)    
                    the numerator of which shall be the Current Market Price per share of
the Common                     Stock on such Record Date; and  

	 	        (ii)    
                    the denominator of which shall be the Current Market Price per share
of the                     Common Stock less the fair market value (as determined by the
Board of                     Directors, whose determination shall be conclusive, and
described in a                     resolution of the Board of Directors) on the Record
Date of the portion of the                     Distributed Assets so distributed
applicable to one share of Common Stock,  

64 

such adjustment to become effective
immediately prior to the opening of business on the day following such Record Date;
provided, however, that in the event (1) the then fair market value (as so
determined) of the portion of the Distributed Assets so distributed applicable to one
share of Common Stock is equal to or greater than the Current Market Price of the Common
Stock on the Record Date or (2) the Current Market Price of Common Stock on the Record
Date exceeds the then fair market value (as so determined) of the portion of the
Distributed Assets so distributed applicable to one share of Common Stock by less than
$1.00, in lieu of the foregoing adjustment, adequate provision shall be made so that each
Holder shall have the right to receive upon conversion the amount of Distributed Assets
such holder would have received had such holder converted each Security on the Record
Date. In the event that such dividend or distribution is not so paid or made, the
Conversion Rate shall again be adjusted to be the Conversion Rate that would then be in
effect if such dividend or distribution had not been declared. If the Board of Directors
determines the fair market value of any distribution for purposes of this Section 10.04(d)
by reference to the actual or when issued trading market for any securities, it must in
doing so consider the prices in such market over the same period used in computing the
Current Market Price of the Common Stock. Notwithstanding the foregoing, if the
Distributed Assets distributed by the Company to all holders of its Common Stock consists
of capital stock of, or similar equity interests in, a Subsidiary or other business unit,
the Conversion Rate shall be increased so that the same shall be equal to the rate
determined by multiplying the Conversion Rate in effect on the Record Date with respect to
such distribution by a fraction: 

	 	        (i)                   the
numerator of which shall be the sum of (x) the average Sale Price over the
               twenty (20) consecutive Trading Day period (the “Spinoff Valuation
               Period”) commencing on and including the fifth Trading Day after the
date                on which “ex-dividend trading” commences on the Common
Stock on the                American Stock Exchange or such other national or regional
exchange or market on                which the Common stock is then listed or quoted and
(y) the average Fair Market                Value (as determined by the Board of
Directors, whose determination shall be                conclusive, and described in a
resolution of the Board of Directors) over the                Spinoff Valuation Period of
the portion of the Distributed Assets so distributed                applicable to one
share of Common Stock; and  

	 	        (ii)                   the
denominator of which shall be the average Sale Price over the Spinoff
               Valuation Period,  

such adjustment to become effective
immediately prior to the opening of business on the day following such Record Date;
provided that the Company may in lieu of the foregoing adjustment make adequate provision
so that each Noteholder shall have the right to receive upon conversion the amount of
Distributed Assets such holder would have received had such holder converted each Note on
the Record Date with respect to such distribution. 

65 

        Rights
or warrants distributed by the Company to all holders of Common Stock (including any
Rights pursuant to the Rights Agreement) entitling the holders thereof to subscribe for or
purchase shares of the Company’s Capital Stock (either initially or under certain
circumstances), which rights or warrants, until the occurrence of a specified event or
events (“Trigger Event”): (i) are deemed to be transferred with such
shares of Common Stock; (ii) are not exercisable; and (iii) are also issued in respect of
future issuances of Common Stock, shall be deemed not to have been distributed for
purposes of this Section 10.04 (and no adjustment to the Conversion Rate under this
Section 10.04 will be required) until the occurrence of the earliest Trigger Event,
whereupon such rights and warrants shall be deemed to have been distributed and an
appropriate adjustment (if any is required) to the Conversion Rate shall be made under
this Section 10.04(d). If any such right or warrant, including any such existing rights or
warrants distributed prior to the date of this Indenture, are subject to events, upon the
occurrence of which such rights or warrants become exercisable to purchase different
securities, evidences of indebtedness or other assets, then the date of the occurrence of
any and each such event shall be deemed to be the date of distribution and record date
with respect to new rights or warrants with such rights (and a termination or expiration
of the existing rights or warrants without exercise by any of the holders thereof). In
addition, in the event of any distribution (or deemed distribution) of rights or warrants,
or any Trigger Event or other event (of the type described in the preceding sentence) with
respect thereto that was counted for purposes of calculating a distribution amount for
which an adjustment to the Conversion Rate under this Section 10.04 was made, (1) in the
case of any such rights or warrants that shall all have been redeemed or repurchased
without exercise by any holders thereof, the Conversion Rate shall be readjusted upon such
final redemption or repurchase to give effect to such distribution or Trigger Event, as
the case may be, as though it were a cash distribution, equal to the per share redemption
or repurchase price received by a holder or holders of Common Stock with respect to such
rights or warrants (assuming such holder had retained such rights or warrants), made to
all holders of Common Stock as of the date of such redemption or repurchase, and (2) in
the case of such rights or warrants that shall have expired or been terminated without
exercise by any holders thereof, the Conversion Rate shall be readjusted as if such rights
and warrants had not been issued. 

        No
adjustment of the Conversion Rate shall be made pursuant to this Section 10.04(d) in
respect of rights or warrants distributed or deemed distributed on any Trigger Event to
the extent that such rights or warrants are actually distributed, or reserved by the
Company for distribution to holders of Securities upon conversion by such holders of
Securities to Common Stock. 

66 

        For
purposes of this Section 10.04(d) and Sections 10.04(a) and (b), any dividend or
distribution to which this Section 10.04(d) is applicable that also includes shares of
Common Stock, or rights or warrants to subscribe for or purchase shares of Common Stock
(or both), shall be deemed instead to be (1) a dividend or distribution of the evidences
of indebtedness, assets or shares of capital stock other than such shares of Common Stock
or rights or warrants (and any Conversion Rate adjustment required by this Section
10.04(d) with respect to such dividend or distribution shall then be made) immediately
followed by (2) a dividend or distribution of such shares of Common Stock or such rights
or warrants (and any further Conversion Rate adjustment required by Sections 10.04(a) and
(b) with respect to such dividend or distribution shall then be made), except (A) the
Record Date of such dividend or distribution shall be substituted as “the date fixed
for the determination of stockholders entitled to receive such dividend or other
distribution”, “the date fixed for the determination of stockholders entitled to
receive such rights or warrants” and “the date fixed for such
determination” within the meaning of Sections 10.04(a) and (b), and (B) any shares of
Common Stock included in such dividend or distribution shall not be deemed
“outstanding at the close of business on the date fixed for such determination”
within the meaning of Section 10.04(a). 

        (e)    
                    In case the Company shall, by dividend or otherwise, distribute to
all holders                     of its Common Stock cash (an “Extraordinary Cash
Dividend”)                     (excluding (x) any quarterly cash dividend on the
Common Stock to the extent the                     aggregate cash dividends per share of
Common Stock in any quarter does not                     exceed $0.12 per share of Common
Stock (subject to appropriate adjustment to                     give effect to any
subdivisions, combinations, stock dividends and stock splits)                     (the
“Dividend Threshold Amount”), and (y) any dividend or
                    distribution in connection with the liquidation, dissolution or
winding up of                     the Company, whether voluntary or involuntary), then,
in such case, the                     Conversion Rate shall be adjusted so that the same
shall equal the rate                     determined by multiplying the Conversion Rate in
effect immediately prior to the                     close of business on such record date
by a fraction,  

	 	        (i)    
                    the numerator of which shall be the Current Market Price of the
Common Stock on                     the Record Date, and  

	 	        (ii)    
                    the denominator of which shall be such Current Market Price of the
Common Stock                     less the amount per share by which such dividend exceeds
the Dividend Threshold                     Amount or the amount of such distribution,  

such adjustment to be effective
immediately prior to the opening of business on the day following the Record Date;
provided, however, that in the event the portion of the cash so distributed
applicable to one share of Common Stock is equal to or greater than the Current Market
Price of the Common Stock on the Record Date, in lieu of the foregoing adjustment,
adequate provision shall be made so that each Holder shall have the right to receive upon
conversion the amount of cash such holder would have received had such holder converted
each Security on the record date. In the event that such dividend or distribution is not
so paid or made, the Conversion Rate shall again be adjusted to be the Conversion Rate
that would then be in effect if such dividend or distribution had not been declared. If
any adjustment is required to be made as set forth in this Section 10.04(e) as a result of
a distribution that is a quarterly dividend, such adjustment shall be based upon the
amount by which such distribution exceeds the amount of the quarterly cash dividend
permitted to be excluded pursuant hereto. If an adjustment is required to be made as set
forth in this Section 10.04(e) above as a result of a distribution that is not a quarterly
dividend, such adjustment shall be based upon the full amount of the distribution. 

67 

        (f)    
                    In case a tender or exchange offer made by the Company or any
Subsidiary for all                     or any portion of the Common Stock shall expire
and such tender or exchange                     offer (as amended upon the expiration
thereof) shall require the payment to                     stockholders of consideration
per share of Common Stock having a Fair Market                     Value (as determined
by the Board of Directors, whose determination shall be                     conclusive
and described in a resolution of the Board of Directors) that as of
                    the last time (the “Expiration Time”) tenders or
exchanges may                     be made pursuant to such tender or exchange offer (as
it may be amended) exceeds                     the last reported Sale Price of the Common
Stock on the Trading Day next                     succeeding the Expiration Time, the
Conversion Rate shall be adjusted so that                     the same shall equal the
rate determined by multiplying the Conversion Rate in                     effect
immediately prior to the Expiration Time by a fraction  

	 	        (i)    
                    the numerator of which shall be the sum of (x) the Fair Market Value
(determined                     as aforesaid) of the aggregate consideration payable to
stockholders based on                     the acceptance (up to any maximum specified in
the terms of the tender or                     exchange offer) of all shares validly
tendered or exchanged and not withdrawn as                     of the Expiration Time
(the shares deemed so accepted up to any such maximum,                     being referred
to as the “Purchased Shares”) and (y) the                     product of
the number of shares of Common Stock outstanding (less any Purchased
                    Shares) at the Expiration Time and the last reported Sale Price of
the Common                     Stock on the Trading Day next succeeding the Expiration
Time, and  

	 	        (ii)    
                    the denominator of which shall be the number of shares of Common
Stock                     outstanding (including any tendered or exchanged shares) at the
Expiration Time                     multiplied by last reported Sale Price of the Common
Stock on the Trading Day                     next succeeding the Expiration Time,  

such adjustment to become effective
immediately prior to the opening of business on the day following the Expiration Time. In
the event that the Company is obligated to purchase shares pursuant to any such tender or
exchange offer, but the Company is permanently prevented by applicable law from effecting
any such purchases or all such purchases are rescinded, the Conversion Rate shall again be
adjusted to be the Conversion Rate that would then be in effect if such tender or exchange
offer had not been made. 

68 

        (g)    
                    In case of a tender or exchange offer made by a Person other than the
Company or                     any Subsidiary for an amount that increases the offeror’s
ownership of                     Common Stock to more than twenty-five percent (25%) of
the Common Stock                     outstanding and shall involve the payment by such
Person of consideration per                     share of Common Stock having a Fair
Market Value (as determined by the Board of                     Directors, whose
determination shall be conclusive, and described in a                     resolution of
the Board of Directors) that as of the last time (the                     “Offer
Expiration Time”) tenders or exchanges may be made                     pursuant
to such tender or exchange offer (as it shall have been amended) that
                    exceeds the last reported Sale Price of the Common Stock on the
Trading Day next                     succeeding the Offer Expiration Time, and in which,
as of the Offer Expiration                     Time the Board of Directors is not
recommending rejection of the offer, the                     Conversion Rate shall be
adjusted so that the same shall equal the rate                     determined by
multiplying the Conversion Rate in effect immediately prior to the
                    Offer Expiration Time by a fraction  

	 	        (i)    
                    the numerator of which shall be the sum of (x) the Fair Market Value
(determined                     as aforesaid) of the aggregate consideration payable to
stockholders based on                     the acceptance (up to any maximum specified in
the terms of the tender or                     exchange offer) of all shares validly
tendered or exchanged and not withdrawn as                     of the Offer Expiration
Time (the shares deemed so accepted, up to any such                     maximum, being
referred to as the “Accepted Purchased Shares”)                     and
(y) the product of the number of shares of Common Stock outstanding (less
                    any Accepted Purchased Shares) at the Offer Expiration Time and the
last                     reported Sale Price of the Common Stock on the Trading Day next
succeeding the                     Offer Expiration Time, and  

	 	        (ii)    
                    the denominator of which shall be the number of shares of Common
Stock                     outstanding (including any tendered or exchanged shares) at the
Offer Expiration                     Time multiplied by the last reported Sale Price of
the Common Stock on the                     Trading Day next succeeding the Offer
Expiration Time,  

such adjustment to become effective
immediately prior to the opening of business on the day following the Offer Expiration
Time. In the event that such Person is obligated to purchase shares pursuant to any such
tender or exchange offer, but such Person is permanently prevented by applicable law from
effecting any such purchases or all such purchases are rescinded, the Conversion Rate
shall again be adjusted to be the Conversion Rate that would then be in effect if such
tender or exchange offer had not been made. Notwithstanding the foregoing, the adjustment
described in this Section 10.04(g) shall not be made if, as of the Offer Expiration Time,
the offering documents with respect to such offer disclose a plan or intention to cause
the Company to engage in any transaction described in Section 10.05. 

69 

        (h)    
                    For purposes of this Section 10.04, the following terms shall have
the meaning                     indicated:  

	 	        (i)    
                    “Current Market Price” shall mean the average of the
daily Sale                     Prices per share of Common Stock for the twenty
consecutive Trading Days                     selected by the Company commencing no more
than 30 Trading Days before and                     ending not later than the earlier of
such date of determination and the day                     before the “ex” date
with respect to the issuance, distribution,                     subdivision or
combination requiring such computation immediately prior to the                     date
in question. For purpose of this paragraph, the term “ex” date,
                    (1) when used with respect to any issuance or distribution, means the
first date                     on which the Common Stock trades, regular way, on the
relevant exchange or in                     the relevant market from which the Sale Price
was obtained without the right to                     receive such issuance or
distribution, and (2) when used with respect to any                     subdivision or
combination of shares of Common Stock, means the first date on                     which
the Common Stock trades, regular way, on such exchange or in such market
                    after the time at which such subdivision or combination becomes
effective.  

        In
the event that another issuance, distribution, subdivision, combination or tender or
exchange offer to which Section 10.04 applies occurs during the period applicable for
calculating “Current Market Price” pursuant to the definition in the preceding
paragraph, “Current Market Price” shall be calculated for such period in a
manner determined by the Board of Directors to reflect the impact of such issuance,
distribution, subdivision, combination or tender or exchange offer on the Sale Price of
the Common Stock during such period. 

	 	        (ii)    
                    “Fair Market Value”, or “fair market value”                    shall
mean the amount which a willing buyer would pay a willing seller in an
                    arm’s-length transaction.  

	 	        (iii)    
                    “Record Date” shall mean, with respect to any
dividend,                     distribution or other transaction or event in which the
holders of Common Stock                     have the right to receive any cash,
securities or other property or in which the                     Common Stock (or other
applicable security) is exchanged for or converted into                     any
combination of cash, securities or other property, the date fixed for
                    determination of stockholders entitled to receive such cash,
securities or other                     property (whether such date is fixed by the Board
of Directors or by statute,                     contract or otherwise).  

        (i)    
                    The Company may make such increases in the Conversion Rate, in
addition to those                     required by Sections 10.04(a), (b), (c), (d), (e),
(f) or (g) as the Board of                     Directors considers to be advisable to
avoid or diminish any income tax to                     holders of Common Stock resulting
from any stock distribution; provided,                     however, that such increase in
the Conversion Rate shall not adversely affect                     the interests of the
Holders of Securities (after taking into account tax and                     other
consequences of such increase).  

70 

        To
the extent permitted by applicable law, the Company from time to time may increase the
Conversion Rate by any amount for any period of time if the period is at least twenty (20)
days, the increase is irrevocable during the period and the Board of Directors shall have
made a determination that such increase would be in the best interests of the Company,
which determination shall be conclusive. Whenever the Conversion Rate is increased
pursuant to the preceding sentence, the Company shall mail to holders of record of the
Securities a notice of the increase at least fifteen (15) days prior to the date the
increased Conversion Rate takes effect, and such notice shall state the increased
Conversion Rate and the period during which it will be in effect. 

        (j)    
                    No adjustment in the Conversion Rate shall be required unless such
adjustment                     would require an increase or decrease of at least one
percent (1%) in such rate; provided, however, that any adjustments that by
reason of this                     Section 10.04 are not required to be made shall be
carried forward and taken                     into account in any subsequent adjustment.
All calculations under this Article                     10 shall be made by the Company
and shall be made to the nearest cent or to the                     nearest one-hundredth
of a share, as the case may be, with one half-cent and                     0.005 of a
share, respectively, being rounded upward. No adjustment need be made
                    for rights to purchase Common Stock pursuant to a Company plan for
reinvestment                     of dividends or interest. To the extent the Securities
become convertible into                     cash, assets, property or securities (other
than capital stock of the Company),                     no adjustment need be made
thereafter as to the cash, assets, property or such                     securities.  

        (k)    
                    Whenever the Conversion Rate is adjusted as herein provided, the
Company shall                     promptly file with the Trustee and any conversion agent
other than the Trustee                     an Officers’ Certificate setting forth
the Conversion Rate after such                     adjustment and setting forth a brief
statement of the facts requiring such                     adjustment. Unless and until a
Responsible Officer of the Trustee shall have                     received such Officers’ Certificate,
the Trustee shall not be deemed to                     have knowledge of any adjustment
of the Conversion Rate and may assume that the                     last Conversion Rate
of which it has knowledge is still in effect. Promptly                     after delivery
of such certificate, the Company shall prepare a notice of such
                    adjustment of the Conversion Rate setting forth the adjusted
Conversion Rate and                     the date on which each adjustment becomes
effective and shall mail such notice                     of such adjustment of the
Conversion Rate to the holder of each Security at his                     last address
appearing on the Security register provided for in Section 2.03 of
                    this Indenture, within twenty (20) days after execution thereof.
Failure to                     deliver such notice shall not affect the legality or
validity of any such                     adjustment.  

71 

        (l)    
                    In any case in which this Section 10.04 provides that an adjustment
shall become                     effective immediately after (1) a record date or Record
Date for an event, (2)                     the date fixed for the determination of
stockholders entitled to receive a                     dividend or distribution pursuant
to Section 10.04(a), (3) a date fixed for the                     determination of
stockholders entitled to receive rights or warrants pursuant to
                    Section 10.04(b), or (4) the Expiration Time for any tender or
exchange offer                     pursuant to Section 10.04(f), or (5) the Offer
Expiration Time for a tender                     offer or exchange offer pursuant to
Section 10.04(g) (each a                     “Determination Date”), the
Company may elect to defer until the                     occurrence of the relevant
Adjustment Event (as hereinafter defined) (x) issuing                     to the holder
of any Security converted after such Determination Date and before
                    the occurrence of such Adjustment Event, the additional shares of
Common Stock                     or other securities issuable upon such conversion by
reason of the adjustment                     required by such Adjustment Event over and
above the Common Stock issuable upon                     such conversion before giving
effect to such adjustment and (y) paying to such                     holder any amount in
cash in lieu of any fraction pursuant to Section 10.04(a).                     For
purposes of this Section 10.04(l), the term “Adjustment                     Event” shall
mean:  

	 	        (i)    
                    in any case referred to in clause (1) hereof, the occurrence of such
event,  

	 	        (ii)    
                    in any case referred to in clause (2) hereof, the date any such
dividend or                     distribution is paid or made,  

	 	        (iii)    
                    in any case referred to in clause (3) hereof, the date of expiration
of such                     rights or warrants, and  

	 	        (iv)    
                    in any case referred to in clause (4) or clause (5) hereof, the date
a sale or                     exchange of Common Stock pursuant to such tender or
exchange offer is                     consummated and becomes irrevocable.  

        (m)    
                    For purposes of this Section 10.04, the number of shares of Common
Stock at any                     time outstanding shall not include shares held in the
treasury of the Company                     but shall include shares issuable in respect
of scrip certificates issued in                     lieu of fractions of shares of Common
Stock. The Company will not pay any                     dividend or make any distribution
on shares of Common Stock held in the treasury                     of the Company.  

72 

        SECTION
10.05. Effect of Reclassification, Consolidation, Merger or Sale. If any of the
following events occur, namely (i) any reclassification or change of the outstanding
shares of Common Stock (other than a subdivision or combination to which Section 10.04(c)
applies), (ii) any consolidation, merger, statutory share exchange or combination of the
Company with another Person as a result of which holders of Common Stock shall be
entitled to receive stock, other securities or other property or assets (including cash)
with respect to or in exchange for such Common Stock, or (iii) any sale or conveyance of
all or substantially all the properties and assets of the Company to any other Person as
a result of which holders of Common Stock shall be entitled to receive stock, other
securities or other property or assets (including cash) with respect to or in exchange
for such Common Stock, then the Company or the successor or purchasing Person, as the
case may be, shall execute with the Trustee a supplemental indenture (which shall comply
with the Trust Indenture Act as in force at the date of execution of such supplemental
indenture) providing that each Security shall be convertible, subject to the provisions
of Section 10.03, into the kind and amount of shares of stock, other securities or other
property or assets (including cash) receivable upon such reclassification, change,
consolidation, merger, statutory share exchange, combination, sale or conveyance by a
holder of a number of shares of Common Stock issuable upon conversion of such Securities
(assuming, for such purposes, a sufficient number of authorized shares of Common Stock
are available to convert all such Securities) immediately prior to such reclassification,
change, consolidation, merger, statutory share exchange, combination, sale or conveyance
assuming such holder of Common Stock did not exercise his rights of election, if any, as
to the kind or amount of stock, other securities or other property or assets (including
cash) receivable upon such reclassification, change, consolidation, merger, statutory
share exchange, combination, sale or conveyance (provided that, if the kind or
amount of stock, other securities or other property or assets (including cash) receivable
upon such reclassification, change, consolidation, merger, statutory share exchange,
combination, sale or conveyance is not the same for each share of Common Stock in respect
of which such rights of election shall not have been exercised (“nonelecting share”),
then for the purposes of this Section 10.05 the kind and amount of stock, other
securities or other property or assets (including cash) receivable upon such
reclassification, change, consolidation, merger, statutory share exchange, combination,
sale or conveyance for each nonelecting share shall be deemed to be the kind and amount
so receivable per share by a plurality of the nonelecting shares). Such supplemental
indenture shall provide for adjustments which shall be as nearly equivalent as may be
practicable to the adjustments provided for in this Article 10.  

        The
Company shall cause notice of the execution of such supplemental indenture to be mailed to
each Holder of Securities, at its address appearing on the Security register provided for
in Section 2.03 of this Indenture, within twenty (20) days after execution thereof.
Failure to deliver such notice shall not affect the legality or validity of such
supplemental indenture. 

        The
above provisions of this Section shall similarly apply to successive reclassifications,
changes, consolidations, mergers, statutory share exchanges, combinations, sales and
conveyances. 

        If
this Section 10.05 applies to any event or occurrence, Section 10.04 shall not apply. 

        SECTION
10.06. Taxes on Shares Issued. The issue of stock certificates on conversions of
Securities shall be made without charge to the converting Holder for any tax in respect
of the issue thereof. The Company shall not, however, be required to pay any tax which
may be payable in respect of any transfer involved in the issue and delivery of stock in
any name other than that of the Holder of any Securities converted, and the Company shall
not be required to issue or deliver any such stock certificate unless and until the
Person or Persons requesting the issue thereof shall have paid to the Company the amount
of such tax or shall have established to the satisfaction of the Company that such tax
has been paid.  

73 

        SECTION
10.07. Reservation of Shares, Shares to Be Fully Paid; Compliance with Governmental
Requirements; Listing of Common Stock.  

        (a)    
                    The Company shall provide, free from preemptive rights, out of its
authorized                     but unissued shares or shares held in treasury, sufficient
shares of Common                     Stock to provide for the conversion of the
Securities from time to time as such                     Securities are presented for
conversion.  

        (b)    
                    Before taking any action which would cause an adjustment increasing
the                     Conversion Rate to an amount that would cause the Conversion
Price to be reduced                     below the then par value, if any, of the shares
of Common Stock issuable upon                     conversion of the Securities, the
Company will take all corporate action which                     may, in the opinion of
its counsel, be necessary in order that the Company may                     validly and
legally issue shares of such Common Stock at such adjusted                     Conversion
Rate.  

        (c)    
Error! Bookmark not defined. The Company covenants that all shares of
                    Common Stock which may be issued upon conversion of Securities or in
payment of                     the Purchase Price or the Fundamental Change Purchase
Price will upon issue be                     fully paid and non-assessable (except as
provided in Section 180.0622(2)(b) of                     the Wisconsin Business
Corporation Law, as such statutory provision has been or                     may be
judicially interpreted) by the Company and free from all taxes, liens and
                    charges with respect to the issue thereof.  

	 	        (ii)    
                    The Company covenants that, if any shares of Common Stock to be
provided for the                     purpose of conversion of Securities hereunder or for
payment of the Purchase                     Price or the Fundamental Change Purchase
Price require registration with or                     approval of any governmental
authority under any federal or state law before                     such shares may be
validly issued upon conversion, the Company will in good                     faith and as
expeditiously as reasonably possible, to the extent then permitted                     by
the rules and interpretations of the Securities and Exchange Commission (or
                    any successor thereto), endeavor to secure such registration or
approval, as the                     case may be.  

	 	        (iii)    
                    The Company further covenants that, if at any time the Common Stock
shall be                     listed on the NYSE or any other national securities exchange
or automated                     quotation system, the Company will, if permitted by the
rules of such exchange                     or automated quotation system, list and keep
listed, so long as the Common Stock                     shall be so listed on such
exchange or automated quotation system, all Common                     Stock issuable
upon conversion of the Security or in payment of the Purchase                     Price
or the Fundamental Change Purchase Price; provided, however,
                    that, if the rules of such exchange or automated quotation system
permit the                     Company to defer the listing of such Common Stock until
the first conversion of                     the Securities into Common Stock or the first
payment of the Purchase Price or                     the Fundamental Change Purchase
Price in Common Stock in accordance with the                     provisions of this
Indenture, the Company covenants to list such Common Stock                     issuable
upon conversion of the Securities or in payment of the Purchase Price
                    or the Fundamental Change Purchase Price in accordance with the
requirements of                     such exchange or automated quotation system at such
time.  

74 

        SECTION
10.08. Responsibility of Trustee. The Trustee and any other conversion agent shall
not at any time be under any duty or responsibility to any holder of Securities to
determine the Conversion Rate or whether any facts exist which may require any adjustment
of the Conversion Rate, or with respect to the nature or extent or calculation of any
such adjustment when made, or with respect to the method employed, or herein or in any
supplemental indenture provided to be employed, in making the same. The Trustee and any
other conversion agent shall not be accountable with respect to the validity or value (or
the kind or amount) of any shares of Common Stock, or of any securities or property,
which may at any time be issued or delivered upon the conversion of any Security; and the
Trustee and any other conversion agent make no representations with respect thereto.
Neither the Trustee nor any conversion agent shall be responsible for any failure of the
Company to issue, transfer or deliver any shares of Common Stock or stock certificates or
other securities or property or cash upon the surrender of any Security for the purpose
of conversion or to comply with any of the duties, responsibilities or covenants of the
Company contained in this Article 10. Without limiting the generality of the foregoing,
neither the Trustee nor any conversion agent shall be under any responsibility to
determine the correctness of any provisions contained in any supplemental indenture
entered into pursuant to Section 10.05 relating either to the kind or amount of shares of
stock or securities or property (including cash) receivable by Holders upon the
conversion of their Securities after any event referred to in such Section 10.05 or to
any adjustment to be made with respect thereto, but, subject to the provisions of Section
7.01, may accept as conclusive evidence of the correctness of any such provisions, and
shall be protected in relying upon, the Officers’Certificate (which the Company
shall be obligated to file with the Trustee prior to the execution of any such
supplemental indenture) with respect thereto.  

        Section
10.09. Notice To Holders Prior To Certain Actions.  In case: 

        (a)              the
Company shall declare a dividend (or any other distribution) on its Common
          Stock that would require an adjustment in the Conversion Rate pursuant to
          Section 10.04; or  

75 

        (b)              the
Company shall authorize the granting to the holders of all or substantially           all
of its Common Stock of rights or warrants to subscribe for or purchase any
          share of any class or any other rights or warrants; or  

        (c)              of
any reclassification or reorganization of the Common Stock of the Company
          (other than a subdivision or combination of its outstanding Common Stock, or a
          change in par value, or from par value to no par value, or from no par value to
          par value), or of any consolidation, merger or statutory share exchange to
which           the Company is a party and for which approval of any stockholders of the
Company           is required, or of the sale or transfer of all or substantially all of
the           assets of the Company; or  

        (d)              of
the voluntary or involuntary dissolution, liquidation or winding up of the
          Company;  

the Company shall cause to be filed
with the Trustee and to be mailed to each Holder of Securities at his address appearing on
the register provided for in Section 2.03 of this Indenture, as promptly as possible but
in any event at least ten (10) days prior to the applicable date hereinafter specified, a
notice stating (x) the date on which a record is to be taken for the purpose of such
dividend, distribution of rights or warrants, or, if a record is not to be taken, the date
as of which the holders of Common Stock of record to be entitled to such dividend,
distribution or rights are to be determined, or (y) the date on which such
reclassification, consolidation, merger, or statutory share exchange, sale, transfer,
dissolution, liquidation or winding up is expected to become effective or occur, and the
date as of which it is expected that holders of Common Stock of record shall be entitled
to exchange their Common Stock for securities or other property deliverable upon such
reclassification, consolidation, merger, or statutory share exchange, sale, transfer,
dissolution, liquidation or winding up. Failure to give such notice, or any defect
therein, shall not affect the legality or validity of such dividend, distribution,
reclassification, consolidation, merger, or statutory share exchange, sale, transfer,
dissolution, liquidation or winding up. 

        SECTION
10.10. Rights Issued in Respect of Common Stock Issued upon Conversion. The
Company has entered into a Rights Agreement dated as of January 28, 2000 between the
Company and Bank Boston N.A., (as amended from time to time, the “Rights Agreement”).
Under the Rights Agreement, preference share purchase rights (the “Rights”)
have been, and may in the future be, issued in respect of shares of Common Stock. Each
share of Common Stock issued upon conversion of Securities pursuant to this Article 10
shall be entitled to receive the appropriate number of Rights, if any, and the
certificates representing the Common Stock issued upon such conversion shall bear such
legends, if any, in each case as provided by and subject to the terms of the Rights
Agreement as in effect at the time of such conversion. If hereafter the Rights separate
from the Common Stock in accordance with the provisions of the Rights Agreement so that a
Securityholder would thereafter not be entitled to receive any Rights in respect of the
Common Stock issuable upon conversion of such Security, the Conversion Rate will be
adjusted as provided in Section 10.04(d) on the separation date. In lieu of any such
adjustment, the Company may amend the Rights Agreement to provide that upon conversion
Securityholders will receive, in addition to the Common Stock issuable upon such
conversion, the Rights which would have attached to such shares of Common Stock if the
Rights had not become separated from the Common Stock pursuant to the provisions of the
Rights Agreement.  

76 

        If
the Company hereafter adopts any stockholder rights plan similar to the Rights Agreement,
a Securityholder shall be entitled to receive upon conversion of its Securities in
addition to the shares of Common Stock issuable upon conversion the related rights for the
Common Stock, whether or not the rights under the future stockholder rights plan have
separated from the Common Stock at the time of conversion, but otherwise subject to the
generally applicable terms of such plan and no additional adjustment to the Conversion
Rate shall be made for the future stockholder rights plan under Section 10.04(d). 

        Section
10.11. Unconditional Right Of Holders To Convert.  

        Notwithstanding
any other provision in this Indenture, the Holder of any Security shall have the right,
which is absolute and unconditional, to convert its Security in accordance with this
Article 10 and to bring an action for the enforcement of any such right to convert, and
such rights shall not be impaired or affected without the consent of such Holder. 

ARTICLE 11 
CONTINGENT
INTEREST  

        Section
11.01. Contingent Interest.  

        (a)              The
Company shall pay Contingent Interest with respect to the Securities for any
          Measurement Period commencing with the Measurement Period ending March 20, 2009
          and ending September 14, 2009, if the average Trading Price of a Security for
          the five consecutive Trading Days ending on the third Trading Day immediately
          preceding the beginning of the relevant Measurement Period equals 120% or more
          of the principal amount of such Security. Notwithstanding the foregoing, if the
          Company declares a dividend on the Common Stock for which the Record Date falls
          prior to the first day of a Measurement Period but the payment date falls
within           such Measurement Period, then the five Trading Day measuring period for
          determining the Trading Price will be the five Trading Days preceding such
          dividend Record Date.  

        (b)    ;          The
amount of Contingent Interest payable per $1,000 principal amount of           Securities
in respect of any Measurement Period will equal 0.25% per annum           calculated on
the average Trading Price of $1,000 principal amount of Securities           during the
five consecutive Trading Days ending on the third Trading Day           immediately
preceding the relevant Measurement Period used to determine whether           Contingent
Interest must be paid.  

77 

        Section
11.02. Payment Of Contingent Interest.  

        Payments
of Contingent Interest shall be made in the same manner, at the same time, and subject to
the same restrictions, including those restrictions in respect of accrued and unpaid
interest on any Securities that are submitted for conversion, as payments of Interest. 

        Section
11.03. Contingent Interest Notification.  

        (a)              By
the first Business Day of a Measurement Period for which Contingent Interest
          will be payable, the Company will disseminate a press release through Dow Jones
          & Company, Inc. or Bloomberg Business News containing this information or
          publish the information on its Web site or through such other public medium as
          it may use may use at that time.  

        (b)              On
any Interest Payment Date on which Contingent Interest is payable pursuant to
          this Article 11, the Company shall issue a press release through Dow Jones &          Company,
Inc. or Bloomberg Business News stating the amount of such Contingent           Interest
and setting forth the manner in which such amount was calculated, or           publish
the information on its Web site or through such other public medium as           it may
use may use at that time.  

ARTICLE 12

SUBORDINATION  

        Section
12.01. Agreement Of Subordination. The Company covenants and agrees, and each
Holder of Securities issued hereunder by its acceptance thereof likewise covenants and
agrees, that all Securities shall be issued subject to the provisions of this Article 12;
and each Person holding any Security, whether upon original issue or upon transfer,
assignment or exchange thereof, accepts and agrees to be bound by such provisions.  

        The
payment of the principal of, premium, if any, Interest, Contingent Interest, if any, and
Liquidated Damages, if any, on all Securities (including, but not limited to, the
Redemption Price, Purchase Price and the Fundamental Change Purchase Price with respect to
the Securities subject to redemption or purchase in accordance with Article 3 as provided
in this Indenture) issued hereunder shall, to the extent and in the manner hereinafter set
forth, be subordinated and subject in right of payment to the prior payment in full in
cash or other payment satisfactory to the holders of Senior Debt of all Obligations in
respect of Senior Debt, whether outstanding at the date of this Indenture or thereafter
incurred. 

78 

        No
provision of this Article 12 shall prevent the occurrence of any default or Event of
Default hereunder. 

        Section
12.02. Payments To Holders. No payment shall be made with respect to the principal
of, or premium, if any, or Interest, Contingent Interest, if any, or Liquidated Damages,
if any, on the Securities (including, but not limited to, the Redemption Price, Purchase
Price and the Fundamental Change Purchase Price with respect to the Securities subject to
redemption or purchase in accordance with Article 3 as provided in this Indenture),
except payments and distributions made by the Trustee as permitted by the first or second
paragraph of Section 12.05, if:  

	 	        (i)                   a
default in the payment of principal, premium, interest, rent or other
               obligations due on any Designated Senior Debt occurs and is continuing
(or, in                the case of Designated Senior Debt for which there is a period of
grace, in the                event of such a default that continues beyond the period of
grace, if any,                specified in the instrument or lease evidencing such
Designated Senior Debt)                (called a “Payment Default”); or  

	 	        (ii)                   a
default, other than a Payment Default, on a Designated Senior Debt occurs and
               is continuing that then permits holders of such Designated Senior Debt to
               accelerate its maturity and the Trustee receives a notice of the default
(a                “Payment Blockage Notice”) from a Representative or
holder of                Designated Senior Debt or the Company (called a “Non-payment
               Default”).  

        Subject
to the provisions of Section 12.05, if the Trustee receives any Payment Blockage Notice
pursuant to clause (ii) above, no subsequent Payment Blockage Notice shall be effective
for purposes of this Section unless and until at least 360 days shall have elapsed since
the initial effectiveness of the immediately prior Payment Blockage Notice. No Non-payment
Default that existed or was continuing on the date any Payment Blockage Notice is received
by the Trustee with respect to the Designated Senior Debt whose holder(s) or
Representative delivered (or caused the Company to deliver) such Payment Blockage Notice
(unless such default was waived or cured for a period of not less than 90 days and
thereafter subsequently reoccurred) shall be, or be made, the basis for a subsequent
Payment Blockage Notice by the holders of such Senior Debt. 

        The
Company may and shall resume payments on and distributions in respect of the Securities
upon the earlier of: 

        (a)              in
the case of a Payment Default, the date upon which the Payment Default is           cured
or waived or ceases to exist, or  

        (b)              in
the case of a Non-Payment Default referred to in clause (ii) above, the           earlier
of the date on which such Non-Payment Default is cured or waived or           ceases to
exist or 179 days pass after the date on which the applicable Payment           Blockage
Notice is received, unless the maturity of any Designated Senior Debt           has been
accelerated in which case clause (a) above shall become applicable or           this
Article 12 otherwise prohibits the payment or distribution at the time of           such
payment or distribution.  

79 

        Upon
any payment by the Company, or distribution of assets of the Company of any kind or
character, whether in cash, property or securities, to creditors upon any dissolution or
winding-up or liquidation or reorganization of the Company (whether voluntary or
involuntary) or in bankruptcy, insolvency, receivership or similar proceedings, all
Obligations due or to become due in respect of Senior Debt shall first be paid in full in
cash, or other payments satisfactory to the holders of Senior Debt, before any payment is
made on account of the principal of, premium, if any, Interest, Contingent Interest, if
any, or Liquidated Damages, if any, on the Securities (except payments made pursuant to
Article 8 from monies deposited with the Trustee pursuant thereto prior to commencement of
proceedings for such dissolution, winding-up, liquidation or reorganization); and upon any
such dissolution or winding-up or liquidation or reorganization of the Company or
bankruptcy, insolvency, receivership or other proceeding, any payment by the Company, or
distribution of assets of the Company of any kind or character, whether in cash, property
or securities, to which the Holders of the Securities or the Trustee would be entitled,
except for the provision of this Article 12, shall (except as aforesaid) be paid by the
Company or by any receiver, trustee in bankruptcy, liquidating trustee, agent or other
Person making such payment or distribution, or by the Holders of the Securities or by the
Trustee under this Indenture if received by them or it, directly to the holders of Senior
Debt (pro rata to such holders on the basis of the respective amounts of Senior Debt held
by such holders, or as otherwise required by law or a court order) or their representative
or representatives, or to the trustee or trustees under any indenture pursuant to which
any instruments evidencing any Senior Debt may have been issued, as their respective
interests may appear, to the extent necessary to pay all Obligations in respect of Senior
Debt in full in cash, or other payment satisfactory to the holders of Senior Debt, after
giving effect to any concurrent payment or distribution to or for the holders of Senior
Debt, before any payment or distribution is made to the Holders of the Securities or to
the Trustee. 

        In
the event of the acceleration of the Securities because of an Event of Default, the
Company shall promptly notify holders of Senior Debt or a Representative for the Senior
Debt of such acceleration. Except payments and distributions made by the Trustee as
permitted by Section 12.05, no payment or distribution shall be made to the Trustee or any
Holder of Securities in respect of the principal of, premium, if any, Interest, Contingent
Interest, if any, or Liquidated Damages, if any, on the Securities by the Company
(including, but not limited to, the Redemption Price, the Purchase Price or Fundamental
Change Purchase Price with respect to the Securities subject to redemption or purchase in
accordance with Article 3 as provided in this Indenture), until five days after the
holders or trustees of Senior Debt receive notice of the acceleration and, after which,
until all Obligations in respect of Senior Debt have been paid in full in cash or other
payment satisfactory to the holders of Senior Debt or such acceleration is rescinded in
accordance with the terms of this Indenture. 

80 

        In
the event that, notwithstanding the foregoing provisions, any payment or distribution of
assets of the Company of any kind or character, whether in cash, property or securities
(including, without limitation, by way of setoff or otherwise), prohibited by the
foregoing, shall be received by the Trustee or the Holders of the Securities before all
Obligations in respect of Senior Debt have been paid in full, in cash or other payment or
provision therefor satisfactory to the holders of Senior Debt, 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 Debt or their Representative or Representatives, or to the
trustee or trustees under any indenture pursuant to which any instruments evidencing any
Senior Debt may have been issued, as their respective interests may appear, as calculated
by the Company, for application to the payment of all Obligations in respect of Senior
Debt remaining unpaid to the extent necessary to pay all Obligations in respect of Senior
Debt in full, in cash or other payment satisfactory to the holders of Senior Debt, after
giving effect to any concurrent payment or distribution to or for the holders of such
Senior Debt. 

        Nothing
in this Section 12.02 shall apply to claims of, or payments to, the Trustee under or
pursuant to Section 7.07. This Section 12.02 shall be subject to the further provisions of
Section 12.05. 

        Section
12.03. Subrogation Of Securities. Subject to the prior payment in full, in cash or
other payment satisfactory to the holders of Senior Debt, of all Obligations in respect
of Senior Debt, the rights of the Holders of the Securities shall be subrogated to the
extent of the payments or distributions made to the holders of such Senior Debt pursuant
to the provisions of this Article 12 (equally and ratably with the holders of all
indebtedness of the Company which by its express terms is subordinated to other
indebtedness of the Company to substantially the same extent as the Securities are
subordinated and is entitled to like rights of subrogation) to the rights of the holders
of Senior Debt to receive payments or distributions of cash, property or securities of
the Company applicable to the Senior Debt until the principal, premium, if any, Interest,
Contingent Interest, if any, and Liquidated Damages, if any, on the Securities shall be
paid in full; and, for the purposes of such subrogation, no payments or distributions to
the holders of the Senior Debt of any cash, property or securities to which the Holders
of the Securities or the Trustee would be entitled except for the provisions of this
Article 12, and no payment over pursuant to the provisions of this Article 12, to or for
the benefit of the holders of Senior Debt by Holders of the Securities or the Trustee,
shall, as between the Company, its creditors other than holders of Senior Debt, and the
Holders of the Securities, be deemed to be a payment by the Company to or on account of
the Senior Debt; and no payments or distributions of cash, property or securities to or
for the benefit of the Holders of the Securities pursuant to the subrogation provisions
of this Article 12, which would otherwise have been paid to the holders of Senior Debt
shall be deemed to be a payment by the Company to or for the account of the Securities.
It is understood that the provisions of this Article 12 are and are intended solely for
the purposes of defining the relative rights of the Holders of the Securities, on the one
hand, and the holders of the Senior Debt, on the other hand.  

81 

        Nothing
contained in this Article 12 or elsewhere in this Indenture or in the Securities is
intended to or shall impair, as among the Company, its creditors other than the holders of
Senior Debt, and the Holders of the Securities, the obligation of the Company, which is
absolute and unconditional, to pay to the Holders of the Securities the principal of (and
premium, if any), Interest, Contingent Interest, if any, and Liquidated Damages, if any,
on the Securities as and when the same shall become due and payable in accordance with
their terms, or is intended to or shall affect the relative rights of the Holders of the
Securities and creditors of the Company other than the holders of the Senior Debt, nor
shall anything herein or therein prevent the Trustee or the Holder of any Security from
exercising all remedies otherwise permitted by applicable law upon default under this
Indenture, subject to the rights, if any, under this Article 12 of the holders of Senior
Debt in respect of cash, property or securities of the Company received upon the exercise
of any such remedy. 

        Upon
any payment or distribution of assets of the Company referred to in this Article 12, the
Trustee, subject to the provisions of Section 7.01, and the Holders of the Securities
shall be entitled to rely upon any order or decree made by any court of competent
jurisdiction in which such bankruptcy, dissolution, winding-up, liquidation or
reorganization proceedings are pending, or a certificate of the receiver, trustee in
bankruptcy, liquidating trustee, agent or other person making such payment or
distribution, delivered to the Trustee or to the Holders of the Securities, for the
purpose of ascertaining the persons entitled to participate in such distribution, the
holders of the Senior Debt and other indebtedness of the Company, the amount thereof or
payable thereon and all other facts pertinent thereto or to this Article 12. 

        Section
12.04. Authorization To Effect Subordination. Each Holder of a Security by the
Holder’s acceptance thereof authorizes and directs the Trustee on the Holder’s
behalf to take such action as may be necessary or appropriate to effectuate the
subordination as provided in this Article 12 and appoints the Trustee to act as the Holder’s
attorney-in-fact for any and all such purposes. If the Trustee does not file a proper
proof of claim or proof of debt in the form required in any proceeding referred to in
Section 12.03 hereof at least 30 days before the expiration of the time to file such
claim, the holders of any Senior Debt or their representatives are hereby authorized to
file an appropriate claim for and on behalf of the Holders of the Securities.  

82 

        Section
12.05. Notice To Trustee. The Company shall give prompt written notice in the form
of an Officers’Certificate to a Trust Officer of the Trustee and to any Paying Agent
of any fact known to the Company which would prohibit the making of any payment of monies
to or by the Trustee or any Paying Agent in respect of the Securities pursuant to the
provisions of this Article 12. Notwithstanding the provisions of this Article 12 or any
other provision of this Indenture, the Trustee shall not be charged with knowledge of the
existence of any facts which would prohibit the making of any payment of monies to or by
the Trustee in respect of the Securities pursuant to the provisions of this Article 12,
unless and until a Trust Officer of the Trustee shall have received written notice
thereof at the Corporate Trust Office from the Company (in the form of an Officers’ Certificate)
or a Representative or a Holder or Holders of Senior Debt or from any trustee thereof;
and before the receipt of any such written notice, the Trustee, subject to the provisions
of Section 7.01, shall be entitled in all respects to assume that no such facts exist;
provided that if on a date not less than one Business Day prior to the date upon which by
the terms hereof any such monies may become payable for any purpose (including, without
limitation, the payment of the principal of, or premium, if any, Interest, Contingent
Interest, if any, or Liquidated Damages, if any, on any Security) the Trustee shall not
have received, with respect to such monies, the notice provided for in this Section
12.05, then, anything herein contained to the contrary notwithstanding, the Trustee shall
have full power and authority to receive such monies and to apply the same to the purpose
for which they were received, and shall not be affected by any notice to the contrary
which may be received by it on or after such prior date. Notwithstanding anything in this
Article 12 to the contrary, nothing shall prevent any payment by the Trustee to the
Holders of monies deposited with it pursuant to Article 8, and any such payment shall not
be subject to the provisions of Article 12.  

83 

        The
Trustee, subject to the provisions of Section 7.01, shall be entitled to rely on the
delivery to it of a written notice by a Representative or a person representing himself to
be a holder of Senior Debt (or a trustee on behalf of such holder) to establish that such
notice has been given by a Representative or a holder of Senior Debt or a trustee on
behalf of any such holder or holders. In the event that the Trustee determines in good
faith that further evidence is required with respect to the right of any person as a
holder of Senior Debt to participate in any payment or distribution pursuant to this
Article 12, the Trustee may request such Person to furnish evidence to the reasonable
satisfaction of the Trustee as to the amount of Obligations in respect of Senior Debt held
by such Person, the extent to which such Person is entitled to participate in such payment
or distribution and any other facts pertinent to the rights of such Person under this
Article 12, and if such evidence is not furnished the Trustee may defer any payment to
such Person pending judicial determination as to the right of such Person to receive such
payment. 

        Section
12.06. Trustee’s Relation To Senior Debt. The Trustee in its individual
capacity shall be entitled to all the rights set forth in this Article 12 in respect of
any Senior Debt at any time held by it in its separate capacity and not as Trustee, to
the same extent as any other holder of Senior Debt, and nothing in Section 7.11 or
elsewhere in this Indenture shall deprive the Trustee of any of its rights as such
holder.  

        With
respect to the holders of Senior Debt, the Trustee undertakes to perform or to observe
only such of its covenants and obligations as are specifically set forth in this Article
12, and no implied covenants or obligations with respect to the holders of Senior Debt
shall be read into this Indenture against the Trustee. The Trustee shall not be deemed to
owe any fiduciary duty to the holders of Senior Debt and, subject to the provisions of
Section 7.01, the Trustee shall not be liable to any holder of Senior Debt if it shall pay
over or deliver to Holders of Securities, the Company or any other person money or assets
to which any holder of Senior Debt shall be entitled by virtue of this Article 12 or
otherwise. 

        Section
12.07. No Impairment Of Subordination. No right of any present or future holder of
any Senior Debt to enforce subordination as herein provided shall at any time in any way
be prejudiced or impaired by any act or failure to act on the part of the Company or by
any act or failure to act, in good faith, by any such holder, or by any noncompliance by
the Company with the terms, provisions and covenants of this Indenture, regardless of any
knowledge thereof which any such holder may have or otherwise be charged with.  

        Section
12.08. Certain Conversions Not Deemed Payment. For the purposes of this Article 12
only, the issuance and delivery of junior securities upon conversion of Securities in
accordance with Article 10 shall not be deemed to constitute a payment or distribution on
account of the principal of such Security (or premium, if any) or interest. For the
purposes of this Section 12.08, the term “junior securities” means Error!
Bookmark not defined.shares of any stock of any class of the Company, or Error!
Bookmark not defined.securities of the Company which are subordinated in right of
payment to all Senior Debt which may be outstanding at the time of issuance or delivery
of such securities to substantially the same extent as, or to a greater extent than, the
Securities are so subordinated as provided in this Article. Nothing contained in this
Article 12 or elsewhere in this Indenture or in the Securities is intended to or shall
impair, as among the Company, its creditors other than holders of Senior Debt and the
Holders, the right, which is absolute and unconditional, of the Holder of any Security to
convert such Security in accordance with Article 10.  

        Section
12.09. Article Applicable To Paying Agents. If at any time any Paying Agent other
than the Trustee shall have been appointed by the Company and be then acting hereunder,
the term “Trustee” as used in this Article shall (unless the context otherwise
requires) be construed as extending to and including such Paying Agent within its meaning
as fully for all intents and purposes as if such Paying Agent were named in this Article
in addition to or in place of the Trustee; provided, however, that the
first paragraph of Section 12.05 shall not apply to the Company or any Affiliate of the
Company if it or such Affiliate acts as Paying Agent.  

84 

        Section
12.10. Senior Debt Entitled To Rely. The holders of Senior Debt (including,
without limitation, Designated Senior Debt) shall have the right to rely upon this
Article 12, and no amendment or modification of the provisions contained herein shall
diminish the rights of such holders unless such holders shall have agreed in writing
thereto.  

ARTICLE 13

MISCELLANEOUS  

        Section
13.01. Trust Indenture Act Controls. If any provision of this Indenture limits,
qualifies, or conflicts with another provision which is required to be included in this
Indenture by the TIA, the required provision shall control.  

        Section
13.02. Notices. Any request, demand, authorization, notice, waiver, consent or
communication shall be in writing and delivered in person or mailed by first-class mail,
postage prepaid, addressed as follows or transmitted by facsimile transmission (confirmed
by guaranteed overnight courier) to the following facsimile numbers:  

	 	
if
to the Company: 

	 	
Regal-Beloit
Corporation          
200 State Street          
Beloit, Wisconsin  53511          
Attn:
 Chief Executive Officer          
Tel: (608) 364-8808          
Facsimile No.: (608)
364-8818 

	 	
if
to the Trustee: 

	 	
U.S.
Bank National Association          
60 Livingston Avenue          
St. Paul, MN 55107
         
Attn:  Corporate Trust Services, Rick Prokosch          
Tel: (651) 495-3918
         
Fax: (651) 495-8097 

        The
Company or the Trustee by notice given to the other in the manner provided above may
designate additional or different addresses for subsequent notices or communications. 

85 

        Any
notice or communication given to a Securityholder shall be mailed to the Securityholder,
by first-class mail, postage prepaid, at the Securityholder’s address as it appears
on the registration books of the Registrar and shall be sufficiently given if so mailed
within the time prescribed. 

        Failure
to mail a notice or communication to a Securityholder or any defect in it shall not affect
its sufficiency with respect to other Securityholders. If a notice or communication is
mailed in the manner provided above, it is duly given, whether or not received by the
addressee. 

        If
the Company mails a notice or communication to the Securityholders, it shall mail a copy
to the Trustee and each Registrar, Paying Agent, Conversion Agent or co-registrar. 

        Section
13.03. Communication By Holders With Other Holders. Securityholders may
communicate pursuant to TIA Section 312(b) with other Securityholders with respect to
their rights under this Indenture or the Securities. The Company, the Trustee, the
Registrar, the Paying Agent, the Conversion Agent and anyone else shall have the
protection of TIA Section 312(c).  

        Section
13.04. Certificate And Opinion As To Conditions Precedent. Upon any request or
application by the Company to the Trustee to take any action under this Indenture, the
Company shall furnish to the Trustee:  

	 	        (1)    
                    an Officers’ Certificate stating that, in the opinion of the
signers, all                     conditions precedent, if any, provided for in this
Indenture relating to the                     proposed action have been complied with;
and  

	 	        (2)    
                    an Opinion of Counsel stating that, in the opinion of such counsel,
all such                     conditions precedent have been complied with.  

        Section
13.05. Statements Required In Certificate Or Opinion. Each Officers’ Certificate
or Opinion of Counsel with respect to compliance with a covenant or condition provided
for in this Indenture shall include:  

	 	        (1)    
                    a statement that each person making such Officers’ Certificate
or Opinion                     of Counsel has read such covenant or condition;  

	 	        (2)    
                    a brief statement as to the nature and scope of the examination or
investigation                     upon which the statements or opinions contained in such
Officers’                    Certificate or Opinion of Counsel are based;  

	 	        (3)    
                    a statement that, in the opinion of each such person, he has made
such                     examination or investigation as is necessary to enable such
person to express an                     informed opinion as to whether or not such
covenant or condition has been                     complied with; and  

86 

	 	        (4)    
                    a statement that, in the opinion of such person, such covenant or
condition has                     been complied with.  

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

        Section
13.07. Rules By Trustee, Paying Agent, Conversion Agent and Registrar. The Trustee
may make reasonable rules for action by or a meeting of Securityholders. The Registrar,
the Conversion Agent and the Paying Agent may make reasonable rules for their functions.  

        Section
13.08. Legal Holidays. A “Legal Holiday” is any day other than a
Business Day. If any specified date (including a date for giving notice) is a Legal
Holiday, the action shall be taken on the next succeeding day that is not a Legal
Holiday, and, if the action to be taken on such date is a payment in respect of the
Securities, no interest shall accrue with respect to such payment for the intervening
period.  

Section 13.09. GOVERNING
LAW. THIS INDENTURE SHALL BE GOVERNED BY, AND CONSTRUED IN ACCORDANCE WITH, THE LAWS
OF THE STATE OF NEW YORK. 

        Section
13.10. No Recourse Against Others. A director, officer, employee or stockholder,
as such, of the Company shall not have any liability for any obligations of the Company
under the Securities or this Indenture or for any claim based on, in respect of or by
reason of such obligations or their creation. By accepting a Security, each
Securityholder shall waive and release all such liability. The waiver and release shall
be part of the consideration for the issue of the Securities.  

        Section
13.11. Successors. All agreements of the Company in this Indenture and the
Securities shall bind its successor. All agreements of the Trustee in this Indenture
shall bind its successor.  

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

87 

        IN
WITNESS WHEREOF, the undersigned, being duly authorized, have executed this Indenture on
behalf of the respective parties hereto as of the date first above written. 

		REGAL-BELOIT CORPORATION
	

 	By:  /s/ Kenneth F. Kaplan
		        Name:  Kenneth F. Kaplan
		        Title:  Vice President, Chief Financial Officer and Secretary
	

 	U.S. BANK NATIONAL ASSOCIATION, As Trustee
	

 	By:  /s/ Richard H. Prokosch
		        Name:  Richard H. Prokosch
		        Title:  Vice President

88 

EXHIBIT A 

[FORM OF FACE OF GLOBAL
SECURITY] 

        UNLESS
THIS CERTIFICATE IS PRESENTED BY AN AUTHORIZED REPRESENTATIVE OF THE DEPOSITORY TRUST
COMPANY TO THE ISSUER 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 THE DEPOSITORY TRUST COMPANY (AND ANY
PAYMENT HEREON IS MADE TO CEDE & CO. OR TO SUCH OTHER ENTITY AS IS REQUESTED BY AN
AUTHORIZED REPRESENTATIVE OF THE DEPOSITORY TRUST COMPANY), ANY TRANSFER, PLEDGE OR OTHER
USE HEREOF FOR VALUE OR OTHERWISE BY OR TO ANY PERSON IS WRONGFUL SINCE THE REGISTERED
OWNER HEREOF, CEDE & CO., HAS AN INTEREST HEREIN. 

        TRANSFERS
OF THIS GLOBAL SECURITY SHALL BE LIMITED TO TRANSFERS TO NOMINEES OF THE DEPOSITORY TRUST
COMPANY, OR TO A SUCCESSOR THEREOF OR SUCH SUCCESSOR’S NOMINEE AND TRANSFERS OF
PORTIONS OF THIS GLOBAL SECURITY SHALL BE LIMITED TO TRANSFERS MADE IN ACCORDANCE WITH THE
RESTRICTIONS SET FORTH IN ARTICLE TWO OF THE INDENTURE REFERRED TO ON THE REVERSE HEREOF. 

        THE
SECURITY EVIDENCED BY THIS CERTIFICATE HAS NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF
1933, AS AMENDED (THE “SECURITIES ACT OF 1933”), OR ANY STATE SECURITIES LAWS,
AND MAY NOT BE OFFERED OR SOLD EXCEPT AS SET FORTH IN THE FOLLOWING SENTENCE. BY
ACQUISITION HEREOF, THE HOLDER: 

	 	(1) 	REPRESENTS
THAT IT IS A “QUALIFIED INSTITUTIONAL BUYER” AS DEFINED IN
                    RULE 144A UNDER THE SECURITIES ACT OF 1933; 

	 	(2) 	AGREES
THAT IT WILL NOT, PRIOR TO THE DATE (THE “RESALE RESTRICTION
                    TERMINATION DATE”) THAT IS TWO YEARS AFTER THE LATER OF THE
ORIGINAL ISSUE                     DATE HEREOF AND THE LAST DATE ON WHICH THE COMPANY OR
ANY AFFILIATE OF THE                     COMPANY WAS THE OWNER OF THIS SECURITY (OR ANY
PREDECESSOR OF SUCH SECURITY),                     RESELL OR OTHERWISE TRANSFER THE
SECURITY EVIDENCED HEREBY OR THE COMMON STOCK                     ISSUABLE UPON
CONVERSION OF SUCH SECURITY EXCEPT (A) TO REGAL-BELOIT CORPORATION                     OR
ANY SUBSIDIARY THEREOF, (B) TO A QUALIFIED INSTITUTIONAL BUYER IN COMPLIANCE
                    WITH RULE 144A UNDER THE SECURITIES ACT OF 1933, (C) PURSUANT TO ANY
OTHER                     EXEMPTION FROM THE REGISTRATION REQUIREMENTS OF THE SECURITIES
ACT OF 1933,                     INCLUDING RULE 144 UNDER THE SECURITIES ACT OF 1933 (IF
AVAILABLE), OR (D)                     PURSUANT TO A REGISTRATION STATEMENT THAT HAS BEEN
DECLARED EFFECTIVE UNDER THE                     SECURITIES ACT OF 1933 AND WHICH
CONTINUES TO BE EFFECTIVE AT THE TIME OF SUCH                     TRANSFER; AND 

A-1 

	 	(3) 	AGREES
THAT IT WILL DELIVER TO EACH PERSON TO WHOM THE SECURITY EVIDENCED HEREBY
                    IS TRANSFERRED (OTHER THAN A TRANSFER PURSUANT TO RULE 144 OR CLAUSE
2(D) ABOVE)                     A NOTICE SUBSTANTIALLY TO THE EFFECT OF THIS LEGEND. 

        The
foregoing legend may be removed from this Security on satisfaction of the conditions
specified in the Indenture. 

        FOR
PURPOSES OF SECTIONS 1272, 1273 AND 1275 OF THE INTERNAL REVENUE CODE OF 1986, AS AMENDED,
THIS SECURITY IS BEING ISSUED WITH TAX ORIGINAL ISSUE DISCOUNT AND THE ISSUE DATE OF THIS
SECURITY IS APRIL 5, 2004. IN ADDITION, THIS SECURITY IS SUBJECT TO THE UNITED STATES
FEDERAL INCOME TAX REGULATIONS GOVERNING CONTINGENT PAYMENT DEBT INSTRUMENTS. FOR PURPOSES
OF SECTIONS 1272, 1273 AND 1275 OF THE INTERNAL REVENUE CODE, THE COMPARABLE YIELD OF THIS
SECURITY IS 8.75%, COMPOUNDED SEMI-ANNUALLY (WHICH WILL BE TREATED AS THE YIELD TO
MATURITY FOR UNITED STATES FEDERAL INCOME TAX PURPOSES). 

        REGAL-BELOIT
CORPORATION, A WISCONSIN CORPORATION (THE “COMPANY”) AGREES, AND BY ACCEPTING A
BENEFICIAL OWNERSHIP INTEREST IN THIS SECURITY EACH HOLDER AND ANY BENEFICIAL OWNER OF
THIS SECURITY WILL BE DEEMED TO HAVE AGREED, FOR UNITED STATES FEDERAL INCOME TAX PURPOSES
(1) TO TREAT THIS SECURITY AS A DEBT INSTRUMENT THAT IS SUBJECT TO TREAS. REG. SEC.
1.1275-4, OR ANY SUCCESSOR PROVISION (THE “CONTINGENT PAYMENT REGULATIONS”), AND
(2) TO BE BOUND BY THE COMPANY’S DETERMINATION OF THE “COMPARABLE YIELD”
AND “PROJECTED PAYMENT SCHEDULE,” WITHIN THE MEANING OF THE CONTINGENT PAYMENT
REGULATIONS. THE COMPANY AGREES TO PROVIDE PROMPTLY TO THE HOLDER OF THIS SECURITY, UPON
WRITTEN REQUEST, THE ISSUE PRICE, AMOUNT OF TAX ORIGINAL ISSUE DISCOUNT, ISSUE DATE, YIELD
TO MATURITY, COMPARABLE YIELD AND PROJECTED PAYMENT SCHEDULE. ANY SUCH WRITTEN REQUEST
SHOULD BE SENT TO THE COMPANY AT THE FOLLOWING ADDRESS: REGAL-BELOIT CORPORATION, 200
STATE STREET, BELOIT, WISCONSIN 53511, ATTENTION: CHIEF FINANCIAL OFFICER. 

A-2 

        Pursuant
to Section 2.14 of the Indenture, the foregoing legend is required for United States
federal income tax purposes. 

A-3 

REGAL-BELOIT CORPORATION 

2.75% Convertible
Senior Subordinated Notes Due 2024 

	CUSIP:	 
	ISSUE DATE:   April 5, 2004	Principal Amount:   $100,000,000
	No.

        REGAL-BELOIT
CORPORATION, a Wisconsin corporation, promises to pay to Cede & Co., or registered
assigns, the principal amount of One Hundred Million Dollars ($100,000,000), on March 15,
2024. 

        Interest
Rate: 2.75% per year. 

        Interest
Payment Dates: March 15 and September 15 of each year, commencing September 15, 2004. 

        Interest
Record Dates: February 28 (or February 29 in such year as there is a February 29) and
August 31 of each year. 

        Reference
is hereby made to the further provisions of this Security set forth on the reverse side of
this Security, which further provisions shall for all purposes have the same effect as if
set forth at this place. 

A-4 

        IN
WITNESS WHEREOF, the Company has caused this instrument to be duly executed under its
corporate seal. 

	Dated:  April 5, 2004	REGAL-BELOIT CORPORATION
	

 	By:  ___________________________________
		        Kenneth F. Kaplan
		        Vice President, Chief Financial
		        Officer and Secretary

TRUSTEE’S
CERTIFICATE OF AUTHENTICATION 

U.S. BANK
NATIONAL ASSOCIATION 
as Trustee, certifies that this is one 
of the           Securities
referred to in the 
within-mentioned Indenture.  

By__________________________________
Authorized
Signatory 

Dated: April 5, 2004 

A-5 

[FORM OF REVERSE OF
GLOBAL SECURITY] 

2.75% Convertible
Senior Subordinated Notes Due 2024 

        This
Security is one of a duly authorized issue of 2.75% Convertible Notes Due 2024 (the
“Securities”) of Regal-Beloit Corporation, a Wisconsin corporation
(including any successor corporation under the Indenture hereinafter referred to, the
“Company”), issued under an Indenture, dated as of April 5, 2004 (the
“Indenture”), between the Company and U.S. Bank National Association, as
trustee (the “Trustee”). The terms of the Security include those stated
in the Indenture, those made part of the Indenture by reference to the Trust Indenture Act
of 1939, as amended (“TIA”), and those set forth in this Security. This
Security is subject to all such terms, and Holders are referred to the Indenture and the
TIA for a statement of all such terms. To the extent permitted by applicable law, in the
event of any inconsistency between the terms of this Security and the terms of the
Indenture, the terms of the Indenture shall control. Capitalized terms used but not
defined herein have the meanings assigned to them in the Indenture referred to below
unless otherwise indicated. 

     1.    
          Interest. 

        The
Securities shall bear interest on the principal amount thereof at a rate of 2.75% per
year. The Company shall pay Contingent Interest as set forth in the Indenture and in
Section 3 hereof. The Company shall also pay Liquidated Damages as set forth in the
Registration Rights Agreement. 

        Interest
will be payable semi-annually on each Interest Payment Date to Holders at the close of
business on the preceding Interest Record Date. Interest will be computed on the basis of
a 360-day year comprised of twelve 30 day months. 

        The
Company will pay Interest to a person other than the Securityholder of record on the
Interest Record Date if the Company elects to redeem, or Securityholders elect to require
the Company to repurchase, the Securities on a date that is after an Interest Record Date
but on or prior to the corresponding Interest Payment Date. In that instance, the Company
will pay accrued and unpaid Interest on the Securities being redeemed to, but not
including, the Redemption Date, the Purchase Date or the Fundamental Change Purchase Date,
as the case may be, to the same person to whom it will pay the principal of those
Securities. 

        If
the principal amount of any Security, or any accrued and unpaid Interest, Contingent
Interest, if any, or Liquidated Damages, if any, are not paid when due (whether upon
acceleration pursuant to Section 6.02 of the Indenture, upon the date set for payment of
the Redemption Price pursuant to Section 5 hereof, upon the date set for payment of the
Purchase Price or Fundamental Change Purchase Price pursuant to Section 6 hereof, upon the
Stated Maturity of the Securities, upon the Interest Payment Dates or upon the Liquidated
Damages Payment Dates as defined in the Registration Rights Agreement), then in each such
case the overdue amount shall, to the extent permitted by law, bear cash interest at the
rate of 2% per annum, compounded semiannually, which interest shall accrue from the date
such overdue amount was originally due to the date payment of such amount, including
interest thereon, has been made or duly provided for. All such interest shall be payable
in cash on demand but if not so demanded shall be paid quarterly to the Holders on the
last day of each quarter. 

A-6 

     2.    
          Method of Payment. 

        Except
as provided below, the Company shall pay Interest on (i) Global Securities, to DTC in
immediately available funds, (ii) any Certificated Security having an aggregate principal
amount of $5,000,000 or less, by check mailed to the Holder of such Security and (iii) any
Certificated Security having an aggregate principal amount of more than $5,000,000, by
wire transfer in immediately available funds at the election of the Holder of any such
Security. 

        At
Stated Maturity, the Company will pay Interest on Certificated Securities at the
Company’s office or agency in New York City. 

        Subject
to the terms and conditions of the Indenture, the Company will make payments in cash, in
respect of Redemption Prices, Purchase Prices, Fundamental Change Purchase Prices and at
Stated Maturity to Holders who surrender Securities to a Paying Agent to collect such
payments in respect of the Securities. The Company will pay cash amounts in money of the
United States that at the time of payment is legal tender for payment of public and
private debts. However, the Company may make such cash payments by check payable in such
money. 

3.     Contingent
Interest.  

        The
Company shall pay Contingent Interest under the circumstances and in the amounts described
in Article 11 of the Indenture. Such Contingent Interest, if any, shall be payable in the
same manner, at the same time, and subject to the same restrictions, including those
restrictions in respect of accrued and unpaid interest on any Securities that are
submitted for conversion, as payments of Interest. 

     4.    
          Indenture. 

        The
Securities are general unsecured obligations of the Company limited to $100,000,000
aggregate principal amount (up to $115,000,000 aggregate principal amount if the initial
purchasers’ option set forth in the Purchase Agreement is exercised in full). The
Indenture does not limit other indebtedness of the Company, secured or unsecured. 

A-7 

     5.    
          Redemption at the Option of the Company. 

        No
sinking fund is provided for the Securities. The Securities are redeemable for cash at the
option of the Company, in whole or in part, at any time or from time to time on, or after
March 20, 2009 upon not less than 30 nor more than 60 days’ notice by mail for a
redemption price equal to the principal amount of those Securities plus accrued and unpaid
Interest, accrued and unpaid Contingent Interest, if any, and Liquidated Damages, if any,
on those Securities up to (but excluding) the Redemption Date (the “Redemption
Price”). 

        In
no event will any Security be redeemable before March 20, 2009. 

     6.    
          Purchase By the Company at the Option of the Holder. 

        Subject
to the terms and conditions of the Indenture, the Company shall become obligated to
purchase, at the option of the Holder, all or any portion of the Securities held by such
Holder on March 15, 2009, March 15, 2014 and March 15, 2019 in integral multiples of
$1,000 at a Purchase Price equal to the principal amount of those Securities plus accrued
and unpaid Interest, accrued and unpaid Contingent Interest, if any, and Liquidated
Damages, if any, on those Securities up to (but excluding) the Purchase Date. To exercise
such right, a Holder shall deliver to the Paying Agent a Purchase Notice containing the
information set forth in the Indenture, at any time from the opening of business on the
date that is 20 Business Days prior to such Purchase Date until the close of business on
the Business Day prior to such Purchase Date, and shall deliver the Securities to the
Paying Agent as set forth in the Indenture. 

        At
the option of the Holder and subject to the terms and conditions of the Indenture, the
Company shall become obligated to offer to purchase for cash the Securities held by such
Holder after the occurrence of a Fundamental Change of the Company for a Fundamental
Change Purchase Price equal to the principal amount of those Securities plus accrued and
unpaid Interest, accrued and unpaid Contingent Interest, if any, and Liquidated Damages,
if any, on those Securities up to (but excluding) the Fundamental Change Purchase Date. 

        Holders
have the right to withdraw any Purchase Notice or Fundamental Change Purchase Notice, as
the case may be, by delivering to the Paying Agent a written notice of withdrawal in
accordance with the provisions of the Indenture. 

        If
cash sufficient to pay the Purchase Price or Fundamental Change Purchase Price, as the
case may be, of all Securities or portions thereof to be purchased as of the Purchase Date
or the Fundamental Change Purchase Date, as the case may be, is deposited with the Paying
Agent, on the Business Day following the Purchase Date or the Fundamental Change Purchase
Date, Interest, accrued and unpaid Contingent Interest, if any, and Liquidated Damages, if
any, will cease to accrue on such Securities (or portions thereof) up to (but excluding)
such Purchase Date or Fundamental Change Purchase Date, and the Holder thereof shall have
no other rights as such other than the right to receive the Purchase Price or Fundamental
Change Purchase Price upon surrender of such Security. 

A-8 

     7.    
          Notice of Redemption. 

        Notice
of redemption pursuant to Section 5 of this Security will be mailed at least 30 days but
not more than 60 days before the Redemption Date to each Holder of Securities to be
redeemed at the Holder’s registered address. If money sufficient to pay the
Redemption Price of all Securities (or portions thereof) to be redeemed on the Redemption
Date is deposited with the Paying Agent prior to or on the Redemption Date, immediately on
and after such Redemption Date Interest, Contingent Interest, if any, and Liquidated
Damages, if any, will cease to accrue on such Securities or portions thereof. Securities
in denominations larger than $1,000 principal amount may be redeemed in part but only in
integral multiples of $1,000 of principal amount. 

     8.    
          Conversion. 

        Subject
to and in compliance with the provisions of the Indenture (including, without limitation,
the conditions to conversion of this Security set forth in Section 10.01 thereof), a
Holder is entitled, at such Holder’s option, to convert the Holder’s Security
(or any portion of the principal amount thereof that is $1,000 or an integral multiple
$1,000), into fully paid and nonassessable (except as provided in Section 180.0622(2)(b)
of the Wisconsin Business Corporation Law, as such statutory provision has been or may be
judicially interpreted) shares of Common Stock at the Conversion Price in effect at the
time of conversion; provided, however, the Company may satisfy its obligation with respect
to any demand for conversion by delivering Common Stock, cash or a combination of cash and
Common Stock. 

        The
Company will notify Holders of any event triggering the right to convert the Securities as
specified above in accordance with the Indenture. 

        A
Security in respect of which a Holder has delivered a Purchase Notice or Fundamental
Change Purchase Notice, as the case may be, exercising the option of such Holder to
require the Company to purchase such Security may be converted only if such Purchase
Notice or Fundamental Change Purchase Notice, as the case may be, is withdrawn in
accordance with the terms of the Indenture. 

        The
initial Conversion Rate is 39.1179 shares of Common Stock per $1,000 principal amount,
subject to adjustment in certain events described in the Indenture. The Conversion Rate
shall not be adjusted for any accrued and unpaid Interest and accrued and unpaid
Contingent Interest or Liquidated Damages. Upon conversion, no payment shall be made by
the Company with respect to accrued and unpaid Interest and accrued and unpaid Contingent
Interest or Liquidated Damages, if any. Instead, such amount shall be deemed paid by the
shares of Common Stock delivered upon conversion of any Security. In addition, no payment
or adjustment shall be made in respect of dividends on the Common Stock, except as set
forth in the Indenture. 

A-9 

        To
surrender a Security for conversion, a Holder must (1) complete and manually sign the
Notice of Conversion attached hereto (or complete and manually sign a facsimile of such
notice) and deliver such notice to the Conversion Agent, (2) surrender the Security to the
Conversion Agent, (3) furnish appropriate endorsements and transfer documents and (4) pay
any transfer or similar tax, if required. 

        No
fractional shares of Common Stock shall be issued upon conversion of any Security. Instead
of any fractional share of Common Stock that would otherwise be issued upon conversion of
such Security, the Company shall pay a cash adjustment as provided in the Indenture. 

        If
the Company (i) is a party to a consolidation, merger, statutory share exchange or
combination, (ii) reclassifies the Common Stock, or (iii) conveys, transfers or leases its
properties and assets substantially as an entirety to any Person, the right to convert a
Security into shares of Common Stock may be changed into a right to convert it into
securities, cash or other assets of the Company or such other Person, in each case in
accordance with the Indenture. 

     9.    
          Conversion Arrangement on Call for Redemption. 

        Any
Securities called for redemption, unless surrendered for conversion before the close of
business on the Business Day prior to the Redemption Date, may be deemed to be purchased
from the Holders of such Securities at an amount not less than the Redemption Price, by
one or more investment bankers or other purchasers who may agree with the Company to
purchase such Securities from the Holders, to convert them into shares of Common Stock and
to make payment for such Securities to the Trustee in trust for such Holders. 

10.    Paying
Agent, Conversion Agent and Registrar.  

        Initially,
the Trustee will act as Paying Agent, Conversion Agent and Registrar. The Company may
appoint and change any Paying Agent, Conversion Agent or Registrar without notice, other
than notice to the Trustee; provided that the Company will maintain at least one Paying
Agent in the State of New York, City of New York, Borough of Manhattan, which shall
initially be an office or agency of the Trustee. The Company or any of its Subsidiaries or
any of their Affiliates may act as Paying Agent, Conversion Agent or Registrar. 

     11.    
          Denominations; Transfer; Exchange. 

        The
Securities are in fully registered form, without coupons, in denominations of $1,000 of
principal amount and integral multiples of $1,000. A Holder may transfer or exchange
Securities in accordance with the Indenture. The Registrar may require a Holder, among
other things, to furnish appropriate endorsements and transfer documents and to pay any
taxes and fees required by law or permitted by the Indenture. The Registrar need not
transfer or exchange any Securities selected for redemption (except, in the case of a
Security to be redeemed in part, the portion of the Security not to be redeemed) or any
Securities in respect of which a Purchase Notice or Fundamental Change Purchase Notice has
been given and not withdrawn (except, in the case of a Security to be purchased in part,
the portion of the Security not to be purchased) or any Securities for a period of 15 days
before the mailing of a notice of redemption of Securities to be redeemed. 

A-10 

     12.    
          Persons Deemed Owners. 

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

     13.    
          Unclaimed Money or Securities. 

        The
Trustee and the Paying Agent shall return to the Company upon written request any money or
securities held by them for the payment of any amount with respect to the Securities that
remains unclaimed for two years, subject to applicable unclaimed property law. After
return to the Company, Holders entitled to the money or securities must look to the
Company for payment as general creditors unless an applicable abandoned property law
designates another person. 

14. Amendment; Waiver. 

        Subject
to certain exceptions set forth in the Indenture, (i) the Indenture or the Securities may
be amended with the written consent of the Holders of at least a majority in aggregate
principal amount of the outstanding Securities and (ii) certain Events of Defaults may be
waived with the written consent of the Holders of a majority in aggregate principal amount
of the outstanding Securities. Subject to certain exceptions set forth in the Indenture,
without the consent of any Securityholder, the Company and the Trustee may amend the
Indenture or the Securities (i) to add to the covenants of the Company for the benefit of
the Holders of Securities, (ii) to surrender any right or power conferred upon the Company
in the Indenture, (iii) to provide for conversion rights of Holders of Securities if any
reclassification or change of the Common Stock or any consolidation, merger or sale of the
Company’s assets substantially as an entirety occurs, (iv) to provide for the
assumption of the Company’s obligations to the Holders of Securities in the case of a
merger, consolidation, conveyance, transfer or lease pursuant to Article 5 of the
Indenture, (v) to increase the Conversion Rate; provided, however, that such increase in
the Conversion Rate shall not adversely affect the interest of the Holders of Securities
(after taking into account tax and other consequences of such increase), (vi) to comply
with the requirements of the SEC in order to effect or maintain the qualification of the
Indenture under the TIA, (vii) to make any changes or modifications necessary in
connection with the registration of the Securities under the Securities Act as
contemplated in the Registration Rights Agreement; provided, however, that such action
pursuant to this clause does not, in the good faith opinion of the Board of Directors of
the Company (as evidenced by a Board Resolution) and the Trustee, adversely affect the
interests of the Holders of Securities in any material respect, (viii) to cure any
ambiguity or correct or supplement any provision in the Indenture which may be
inconsistent with any other provision therein or which is otherwise defective; provided,
however, that such action pursuant to this clause does not, in the good faith opinion of
the Company and the Trustee, adversely affect the interests of the Holders of Securities
in any material respect, and provided further that any amendment made solely to conform
the provisions herein to the description of the Notes in the Final Offering Memorandum
will not be deemed to adversely affect the interests of the Holders of Securities, and
(ix) to add or modify any other provisions in the Indenture with respect to matters or
questions arising hereunder which the Company and the Trustee may deem necessary or
desirable and which will not adversely affect the interests of the Holders of Securities. 

A-11 

     15.    
          Defaults and Remedies. 

        If
any Event of Default with respect to Securities shall occur and be continuing, the
principal amount of the Securities and any accrued and unpaid Interest, accrued and unpaid
Contingent Interest, if any, and accrued and unpaid Liquidated Damages, if any, on all the
Securities may be declared due and payable in the manner and with the effect provided in
the Indenture. 

     16.    
          Trustee Dealings with the Company. 

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

     17.    
          Calculations in Respect of Securities. 

        The
Company or its agents will be responsible for making all calculations called for under the
Securities including, but not limited to, determination of the market prices for the
Securities and of the Common Stock and the amounts of Contingent Interest and Liquidated
Damages, if any, accrued on the Securities. Any calculations made in good faith and
without manifest error will be final and binding on Holders of the Securities. The Company
or its agents will be required to deliver to the Trustee a schedule of its calculations
and the Trustee will be entitled to conclusively rely upon the accuracy of such
calculations without independent verification. 

A-12 

     18.    
          United States Federal Income Tax Treatment. 

        For
purposes of Sections 1272, 1273 and 1275 of the Internal Revenue Code of 1986, as amended,
this Security is being issued with Tax Original Issue Discount and the issue date of this
Security is April 5, 2004. In addition, this Security is subject to the United States
federal income tax regulations governing contingent payment debt instruments. For purposes
of Sections 1272, 1273 and 1275 of the Internal Revenue Code, the comparable yield of this
Security is 8.75%, compounded semi-annually (which will be treated as the yield to
maturity for United States federal income tax purposes). 

        The
Company agrees, and by accepting a beneficial ownership interest in this Security each
Holder and any beneficial owner of this Security will be deemed to have agreed, for United
States federal income tax purposes (1) to treat this Security as a debt instrument that is
subject to Treas. Reg. Sec. 1.1275-4, or any successor provision (the “contingent
payment regulations”), and (2) to be bound by the Company’s determination of the
“comparable yield” and “projected payment schedule,” within the
meaning of the contingent payment regulations. The Company agrees to provide promptly to
the Holder of this security, upon written request, the issue price, amount of Tax Original
Issue Discount, issue date, yield to maturity, comparable yield and projected payment
schedule. Any such written request should be sent to the Company at the following address:
Regal-Beloit Corporation, 200 State Street, Beloit, Wisconsin 53511, Attention: Chief
Financial Officer. 

19. Subordination. 

        The
indebtedness evidenced by the Securities is, to the extent and in the manner provided in
the Indenture, subordinate and junior in right of payment to the prior payment in full of
all Obligations in respect of Senior Debt of the Company (including any interest accruing
subsequent to the commencement of any bankruptcy or similar proceeding, whether or not a
claim for post-petition interest is allowed as a claim in any such proceeding). Any Holder
by accepting this Security agrees to and shall be bound by such subordination provisions
and authorizes the Trustee to give them effect. In addition to all other rights of Senior
Debt described in the Indenture, the Senior Debt shall continue to be Senior Debt and
entitled to the benefits of the subordination provisions irrespective of any amendment,
modification or waiver of any terms of any instrument relating to the Senior Debt or any
extension or renewal of the Senior Debt. 

     20.    
          No Recourse Against Others. 

        A
director, officer, employee or shareholder, as such, of the Company shall not have any
liability for any obligations of the Company under the Securities or the Indenture or for
any claim based on, in respect of or by reason of such obligations or their creation. By
accepting a Security, each Securityholder waives and releases all such liability. The
waiver and release are part of the consideration for the issue of the Securities. 

A-13 

21.    Authentication.  

        This
Security shall not be valid until an authorized signatory of the Trustee manually signs
the Trustee’s Certificate of Authentication on the other side of this Security. 

22.    Abbreviations.  

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

     23.    
          Governing Law. 

        THE
LAWS OF THE STATE OF NEW YORK SHALL GOVERN THE INDENTURE AND THIS SECURITY. 

     24.    
          Copy of Indenture. 

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

	 	
REGAL-BELOIT
CORPORATION 
200 State Street 
Beloit, Wisconsin 53511 
Attn: Chief Executive Officer

Facsimile No.: (608) 364-8818 

25.    Registration
Rights.  

        The
Holders of the Securities are entitled to the benefits of a Registration Rights Agreement,
dated as of April 5, 2004, among the Company, Banc of America Securities LLC, Deutsche
Bank Securities Inc., Wachovia Capital Markets, LLC and Robert W. Baird & Co.
Incorporated as initial purchasers, including the receipt of Liquidated Damages upon a
Registration Default (as defined in such agreement). The Company shall make payments of
Liquidated Damages on the Liquidated Damages Payment Dates (as defined in the Registration
Rights Agreement), but otherwise in accordance with the provisions set forth herein for
the payment of Interest. 

A-14 

	ASSIGNMENT FORM	CONVERSION NOTICE
	
To assign this Security, fill in the form	To convert this Security into Common Stock
	below:	of the Company, check the box [_]
	
I or we assign and transfer this Security to	To convert only part of this Security,
	_____________________________
_____________________	state the principal amount to be converted
	(Insert assignee's soc. sec. or tax ID no.)	(which must be $1,000 or an integral
		multiple of $1,000):
	
_____________________________	 
	_____________________________	 
	_____________________________	If you want the stock certificate made out
	(Print or type assignee's name, address and	in another person's name fill in the form
	zip code)	below:
		_____________________________
_____________________________
	
and irrevocably appoint	(Insert the other person's soc. sec. tax ID
		no.)
	
____________________ agent to transfer this	_____________________________
	Security on the books of the Company.  The	_____________________________
	agent may substitute another to act for him	_____________________________
		_____________________________
		_____________________________
		(Print or type other person's name, address
		and zip code)

Date:  __________ Your
Signature:  _________________________________ 

______________________________________________________________ 

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

Signature Guaranteed 

________________________________ 

Participant in a
Recognized Signature 

Guarantee Medallion
Program 

By:_____________________________
         
        Authorized Signatory 

A-15 

SCHEDULE OF INCREASES
AND DECREASES 

OF GLOBAL SECURITY 

Initial Principal Amount of Global
Security: One Hundred Million Dollars ($100,000,000). 

	

		Amount of	Amount of	Principal	 
		Increase in	Decrease in	Amount of
		Principal	Principal	Global	Notation by
		Amount of	Amount of	Security After	Registrar or
		Global	Global	Increase or	Security
	Date	Security	Security	Decrease	Custodian
	

	

	

	

	

A-16 

EXHIBIT B 

[FORM OF FACE OF
CERTIFICATED SECURITY] 

        THIS
SECURITY HAS NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED (THE
“SECURITIES ACT”), OR THE SECURITIES LAWS OF ANY STATE OR OTHER JURISDICTION.
NEITHER THIS SECURITY NOR ANY INTEREST OR PARTICIPATION HEREIN MAY BE REOFFERED, SOLD,
ASSIGNED, TRANSFERRED, PLEDGED, ENCUMBERED OR OTHERWISE DISPOSED OF IN THE ABSENCE OF SUCH
REGISTRATION OR UNLESS SUCH TRANSACTION IS EXEMPT FROM, OR NOT SUBJECT TO, SUCH
REGISTRATION. EACH PURCHASER OF THIS NOTE IS HEREBY NOTIFIED THAT THE SELLER OF THIS NOTE
MAY BE RELYING ON THE EXEMPTION FROM THE PROVISIONS OF SECTION 5 OF THE SECURITIES ACT
PROVIDED BY RULE 144A THEREUNDER. 

        THE
HOLDER OF THIS SECURITY, BY ITS ACCEPTANCE HEREOF, (1) REPRESENTS THAT IT IS A
“QUALIFIED INSTITUTIONAL BUYER” AS DEFINED IN RULE 144A UNDER THE SECURITIES ACT
OF 1933 (THE “SECURITIES ACT”), (2) AGREES ON ITS OWN BEHALF AND ON BEHALF OF
ANY INVESTOR ACCOUNT FOR WHICH IT HAS PURCHASED SECURITIES, FOR THE BENEFIT OF
REGAL-BELOIT CORPORATION (THE “ISSUER”) THAT THIS SECURITY MAY BE OFFERED,
RESOLD, PLEDGED OR OTHERWISE TRANSFERRED, ONLY (A) TO THE ISSUER OR ANY SUBSIDIARY
THEREOF, (B) FOR SO LONG AS THE SECURITIES ARE ELIGIBLE FOR RESALE PURSUANT TO RULE 144A
UNDER THE SECURITIES ACT, TO A PERSON IT REASONABLY BELIEVES IS A “QUALIFIED
INSTITUTIONAL BUYER” AS DEFINED IN RULE 144A UNDER THE SECURITIES ACT THAT PURCHASES
FOR ITS OWN ACCOUNT OR FOR THE ACCOUNT OF A QUALIFIED INSTITUTIONAL BUYER TO WHOM NOTICE
IS GIVEN THAT THE TRANSFER IS BEING MADE IN RELIANCE ON RULE 144A, (C) PURSUANT TO AN
EXEMPTION FROM REGISTRATION UNDER THE SECURITIES ACT, INCLUDING RULE 144 UNDER THE
SECURITIES ACT (IF AVAILABLE), OR (D) PURSUANT TO A REGISTRATION STATEMENT THAT HAS BEEN
DECLARED EFFECTIVE UNDER THE SECURITIES ACT, AND IN THE CASE OF (A) THROUGH (D) IN
ACCORDANCE WITH ANY APPLICABLE SECURITIES LAWS OF ANY STATE OF THE UNITED STATES OR ANY
OTHER APPLICABLE JURISDICTION. EACH HOLDER WILL NOTIFY ANY PURCHASER OF THIS SECURITY FROM
IT OF THE RESALE RESTRICTIONS REFERENCED ABOVE. 

        The
foregoing legend may be removed from this Security on satisfaction of the conditions
specified in the Indenture. 

B-1 

        FOR
PURPOSES OF SECTIONS 1272, 1273 AND 1275 OF THE INTERNAL REVENUE CODE OF 1986, AS AMENDED,
THIS SECURITY IS BEING ISSUED WITH TAX ORIGINAL ISSUE DISCOUNT AND THE ISSUE DATE OF THIS
SECURITY IS JUNE 24, 2003. IN ADDITION, THIS SECURITY IS SUBJECT TO THE UNITED STATES
FEDERAL INCOME TAX REGULATIONS GOVERNING CONTINGENT PAYMENT DEBT INSTRUMENTS. FOR PURPOSES
OF SECTIONS 1272, 1273 AND 1275 OF THE INTERNAL REVENUE CODE, THE COMPARABLE YIELD OF THIS
SECURITY IS 8.75%, COMPOUNDED SEMI-ANNUALLY (WHICH WILL BE TREATED AS THE YIELD TO
MATURITY FOR UNITED STATES FEDERAL INCOME TAX PURPOSES). 

        THE
COMPANY AGREES, AND BY ACCEPTING A BENEFICIAL OWNERSHIP INTEREST IN THIS SECURITY EACH
HOLDER AND ANY BENEFICIAL OWNER OF THIS SECURITY WILL BE DEEMED TO HAVE AGREED, FOR UNITED
STATES FEDERAL INCOME TAX PURPOSES (1) TO TREAT THIS SECURITY AS A DEBT INSTRUMENT THAT IS
SUBJECT TO TREAS. REG. SEC. 1.1275-4, OR ANY SUCCESSOR PROVISION (THE “CONTINGENT
PAYMENT REGULATIONS”), AND (2) TO BE BOUND BY THE COMPANY’S DETERMINATION OF THE
“COMPARABLE YIELD” AND “PROJECTED PAYMENT SCHEDULE,” WITHIN THE
MEANING OF THE CONTINGENT PAYMENT REGULATIONS. THE COMPANY AGREES TO PROVIDE PROMPTLY TO
THE HOLDER OF THIS SECURITY, UPON WRITTEN REQUEST, THE ISSUE PRICE, AMOUNT OF TAX ORIGINAL
ISSUE DISCOUNT, ISSUE DATE, YIELD TO MATURITY, COMPARABLE YIELD AND PROJECTED PAYMENT
SCHEDULE. ANY SUCH WRITTEN REQUEST SHOULD BE SENT TO THE COMPANY AT THE FOLLOWING ADDRESS:
REGAL-BELOIT CORPORATION, 200 STATE STREET, BELOIT, WISCONSIN 53511 ATTENTION: CHIEF
FINANCIAL OFFICER. 

        Pursuant
to Section 2.14 of the Indenture, the foregoing legend is required for United States
federal income tax purposes. 

B-2 

REGAL-BELOIT CORPORATION 

2.75% Convertible
Senior Subordinated Notes Due 2024 

	CUSIP:	 
	ISSUE DATE:	Principal Amount:
	No.

        REGAL-BELOIT
CORPORATION, a Wisconsin corporation, promises to pay to Cede & Co., or registered
assigns, the principal amount of One Hundred Million Dollars ($100,000,000), on March 15,
2024. 

        Interest
Rate: 2.75% per year. 

        Interest
Payment Dates: March 15 and September 15 of each year, commencing September 15, 2004. 

        Interest
Record Dates: February 28 (or February 29 in such year as there is a February 29) and
August 31 of each year. 

        Reference
is hereby made to the further provisions of this Security set forth on the reverse side of
this Security, which further provisions shall for all purposes have the same effect as if
set forth at this place. 

B-3 

        IN
WITNESS WHEREOF, the Company has caused this instrument to be duly executed under its
corporate seal. 

	Dated:	REGAL-BELOIT CORPORATION
	

 	By:  __________________________
		Title:  _________________________

TRUSTEE’S
CERTIFICATE OF AUTHENTICATION 

U.S.           Bank National
Association 
as Trustee, certifies that this is one 
of the           Securities referred
to in the 
within-mentioned Indenture.  

By__________________________________
        Authorized
Signatory 

Dated: 

B-4 

[FORM OF REVERSE OF
CERTIFICATED SECURITY IS IDENTICAL TO EXHIBIT A] 

B-5 

EXHIBIT C 

REGAL-BELOIT CORPORATION 

2.75% Convertible
Senior Subordinated Notes Due 2024 

Transfer Certificate 

        In
connection with any transfer of any of the Securities within the period prior to the
expiration of the holding period applicable to the sales thereof under Rule 144(k) under
the Securities Act of 1933, as amended (the “Securities Act”) (or any
successor provision), the undersigned registered owner of this Security hereby certifies
with respect to ___________ principal amount of the above-captioned Securities presented
or surrendered on the date hereof (the “Surrendered Securities”) for
registration of transfer, or for exchange or conversion where the securities issuable upon
such exchange or conversion are to be registered in a name other than that of the
undersigned registered owner (each such transaction being a “transfer”),
that such transfer complies with the restrictive legend set forth on the face of the
Surrendered Securities for the reason checked below: 

	 	[_] 	A
transfer of the Surrendered Securities is made to the Company or any
               subsidiaries; or 

	 	[_] 	The
transfer of the Surrendered Securities is pursuant to an effective
               registration statement under the Securities Act; or 

	 	[_] 	The
transfer of the Surrendered Securities complies with Rule 144A under the
               Securities Act; or 

	 	[_] 	The
transfer of the Surrendered Securities is pursuant to Rule 144 under the
               Securities Act and each of the conditions set forth in such rule have been
met; 

and unless the box below is checked,
the undersigned confirms that, to the undersigned’s knowledge, such Securities are
not being transferred to an “affiliate” of the Company as defined in Rule 144
under the Securities Act (an “Affiliate”). 

C-1 

	 	[_]	The
transferee is an Affiliate of the Company. 

	DATE:	__________________________________
		      Signature(s)

        (If
the registered owner is a corporation, partnership or fiduciary, the title of the person
signing on behalf of such registered owner must be stated.) 

Signature Guaranteed 

__________________________________
Participant in a
Recognized Signature 

C-2Exhibit 4.5 

$100,000,000 AGGREGATE
PRINCIPAL AMOUNT 

Regal-Beloit
Corporation 

2.75% CONVERTIBLE
SENIOR SUBORDINATED NOTES 

DUE 2024 

Resale Registration
Rights Agreement 

dated April 5, 2004 

         RESALE
REGISTRATION RIGHTS AGREEMENT, dated as of April 5, 2004, among Regal-Beloit Corporation,
a Wisconsin corporation (together with any successor entity, herein referred to as the
“Company”), Banc of America Securities LLC, Deutsche Bank Securities
Inc., Wachovia Capital Markets, LLC and Robert W. Baird & Co. Incorporated, as
representatives of the several initial purchasers (the “Initial
Purchasers”) under the Purchase Agreement (as defined below). 

         Pursuant
to the Purchase Agreement, dated as of March 30, 2004, between the Company and Banc of
America Securities LLC and Deutsche Bank Securities Inc., Wachovia Capital Markets, LLC
and Robert W. Baird & Co. Incorporated, as representatives of Initial Purchasers (the
“Purchase Agreement”), the Initial Purchasers have agreed to purchase
from the Company $100,000,000 ($115,000,000 if the Initial Purchasers exercise their
option in full) in aggregate principal amount at maturity of 2.75% Convertible Senior
Subordinated Notes due 2024 (the “Notes”). The Notes may become
convertible into fully paid, nonassessable (except for certain statutory liabilities that
may be imposed by Section 180.0622(b) of the Wisconsin Business Corporation Law, as
judicially interpreted) shares of common stock, par value $.01 per share, of the Company
together with the rights (the “Rights”) evidenced by such Common Stock to
the extent provided in the Rights Agreement dated as of January 28, 2000 between the
Company and BankBoston, N.A. (collectively, the “Common Stock”). The
Notes will be convertible on the terms, and subject to the conditions, set forth in the
Indenture (as defined herein). To induce the Initial Purchasers to purchase the Notes, the
Company has agreed to provide the resale registration rights set forth in this Agreement
pursuant to Section 5(g) of the Purchase Agreement. 

         The
parties hereby agree as follows: 

         1.       Definitions.
Capitalized terms used in this Agreement without definition           shall have
their respective meanings set forth in the Purchase Agreement.As used in this
Agreement, the following capitalized terms shall have the           following meanings:  

        “Affiliate”of
any specified person means any other person which, directly or indirectly, is in control
of, is controlled by, or is under common control with, such specified person. For
purposes of this definition, control of a person means the power, direct or indirect, to
direct or cause the direction of the management and policies of such person whether by
contract or otherwise; and the terms “controlling and “controlledhave
meanings correlative to the foregoing.  

        “Agreement”:
This Resale Registration Rights Agreement.  

        “Amended
Effectiveness Deadline Date” has the meaning set forth in Section 2(e) hereof.  

        “Blue
Sky Application”: As defined in Section 6(a)(i) hereof.  

1 

        “Business
Day”: The definition of "Business Day" in the Indenture.  

        “Commission”:
Securities and Exchange Commission. 

        “Common
Stock”: As defined in the preamble hereto.  

        “Company”:
As defined in the preamble hereto.  

        “Effectiveness
Period”: As defined in Section 2(a)(iii) hereof.  

        “Effectiveness
Target Date”: As defined in Section 2(a)(ii) hereof.  

        “Exchange
Act”: Securities Exchange Act of 1934, as amended.  

        “Holder”:
A Person who owns, beneficially or otherwise, Transfer Restricted Securities.  

        “Indemnified
Holder”: As defined in Section 6(a) hereof.  

        “Indenture”:
The Indenture, dated as of April 5, 2004 between the Company and U.S. Bank National
Association, as trustee (the “Trustee), pursuant to which the Securities are
to be issued, as such Indenture is amended, modified or supplemented from time to time in
accordance with the terms thereof.  

        “Initial
Purchasers”: As defined in the preamble hereto.  

        “Liquidated
Damages”: As defined in Section 3(a) hereof.  

        “Liquidated
Damages Payment Date”: Each March 15 and September 15.  

        “Majority
of Holders”: Holders holding over 50% of the aggregate principal amount of Notes
outstanding; provided that, for the purpose of this definition, a holder of shares of
Common Stock which constitute Transfer Restricted Securities issued upon conversion of
the Notes shall be deemed to hold an aggregate principal amount at maturity of Notes (in
addition to the principal amount of Notes held by such holder) equal to the quotient of
(x) the number of such shares of Common Stock held by such holder and (y) the conversion
rate in effect at the time of such conversion as determined in accordance with the
Indenture.  

        “NASD”:
National Association of Securities Dealers, Inc.  

        “Notes”:
As defined in the preamble hereto.  

        “Notice
and Questionnaire” means a written notice executed by the respective Holder and
delivered to the Company containing substantially the information called for by the
Selling Securityholder Notice and Questionnaire attached as Appendix A to the Offering
Memorandum of the Company issued March 30, 2004 relating to the Notes.  

2 

        “Notice
Holder”. A Holder who has delivered a Notice and Questionnaire to the Company.  

        “Person”:
An individual, partnership, corporation, company, unincorporated organization, trust,
joint venture or a government or agency or political subdivision thereof.  

        “Purchase
Agreement”: As defined in the preamble hereto.  

        “Prospectus”:
The prospectus included in a Shelf Registration Statement, as amended or supplemented by
any prospectus supplement and by all other amendments thereto, including post-effective
amendments, and all material incorporated by reference into such prospectus.  

        “Record
Holder”: With respect to any Liquidated Damages Payment Date, each Person who is
a Holder on the 15th day preceding the relevant Liquidated Damages Payment
Date. In the case of a Holder of shares of Common Stock issued upon conversion of the
Notes, “Record Holder shall mean each Person who is a Holder of shares of
Common Stock which constitute Transfer Restricted Securities on the 15th day
preceding the relevant Liquidated Damages Payment Date.  

        “Registration
Default”: As defined in Section 3(a) hereof.  

        “Securities
Act”: Securities Act of 1933, as amended.  

        “Shelf
Filing Deadline”: As defined in Section 2(a)(i) hereof.  

        “Shelf
Registration Statement”: As defined in Section 2(a)(i) hereof.  

        “Subsequent
Shelf Registration Statement” has the meaning set forth in Section 2(c) hereof.  

        “Suspension
Notice”: As defined in Section 4(c) hereof.  

        “Suspension
Period”: As defined in Section 4(b)(i) hereof.  

        “TIA”:
Trust Indenture Act of 1939, as amended, and the rules and regulations of the Commission
thereunder, in each case, as in effect on the date the Indenture is qualified under the
TIA.  

        “Transfer
Restricted Securities”: Each Note and each share of Common Stock issued upon conversion
of Notes until the earlier of:  

3 

	 	        (i)       
                    the date on which such Note or such share of Common Stock issued upon
conversion                     has been effectively registered under the Securities Act
and disposed of in                     accordance with the Shelf Registration Statement;  

	 	        (ii)      
                    the date on which such Note or such share of Common Stock issued upon
conversion                     is transferred in compliance with Rule 144 under the
Securities Act or may be                     sold or transferred by a person who is not
an affiliate of the Company pursuant                     to Rule 144(k) under the
Securities Act (or any other similar provision then in                     force); or  

	 	        (iii)     
                    the date on which such Note or such share of Common Stock issued upon
conversion                     ceases to be outstanding (whether as a result of
redemption, repurchase and                     cancellation, conversion or otherwise).  

        “Underwritten
Registration”: A registration in which Notes of the Company are sold to an
underwriter for reoffering to the public.  

        Unless
the context otherwise requires, the singular includes the plural, and words in the plural
include the singular.  

         2.       
Shelf Registration.  

	 	        (a)       
                    The Company shall:  

	 	        (i)       
                    not later than 90 days after the date hereof (the “Shelf
Filing                     Deadline”), cause to be filed a registration
statement pursuant to Rule                     415 under the Securities Act (the “Shelf
Registration                     Statement”), which Shelf Registration Statement
shall provide for                     resales of all Transfer Restricted Securities held
by Holders that have provided                     the information required pursuant to
the terms of Section 2(b) hereof;  

	 	        (ii)      
                    use commercially reasonable efforts to cause the Shelf Registration
Statement to                     be declared effective by the Commission not later than
180 days after the date                     hereof (the “Effectiveness Target Date”);
and  

	 	        (iii)     
                    use commercially reasonable efforts to keep the Shelf Registration
Statement                     continuously effective, supplemented and amended as
required by the provisions                     of Section 4(b) hereof to the extent
necessary to ensure that (A) it is                     available for resales by the
Holders of Transfer Restricted Securities entitled,                     subject to
Section 2(b), to the benefit of this Agreement and (B) it conforms
                    with the requirements of this Agreement and the Securities Act and
the rules and                     regulations of the Commission promulgated thereunder as
announced from time to                     time, for a period (the “Effectiveness
Period”) until                     the earlier of:  

4 

	 	        (1)       
                    two years from the last date of original issuance of any of the
Notes;  

	 	        (2)       
                    the expiration of the holding period applicable to the Securities
held by                     non-affiliates under Rule 144(k) under the Securities Act; or  

	 	        (3)       
                    the date when all of the Transfer Restricted Securities of those
Holders that                     complete and deliver in a timely manner the Holder
Questionnaire described below                     are registered under the Shelf
Registration Statement and disposed of in                     accordance with the Shelf
Registration Statement.  

	 	        (b)       
                    At the time the Shelf Registration Statement is declared effective,
each Holder                     that became a Notice Holder on or prior to the date ten
(10) Business Days prior                     to such time of effectiveness shall be named
as a selling securityholder in the                     Shelf Registration Statement and
the related Prospectus in such a manner as to                     permit such Holder to
deliver such Prospectus to purchasers of Transfer                     Restricted
Securities in accordance with applicable law. None of the                     Company’s
securityholders (other than the Holders of Transfer Restricted
                    Securities) shall have the right to include any of the Company’s
securities                     in the Shelf Registration Statement.  

	 	        (c)       
                    If the Shelf Registration Statement or any Subsequent Shelf
Registration                     Statement ceases to be effective for any reason at any
time during the                     Effectiveness Period (other than because all Transfer
Restricted Securities                     registered thereunder shall have been resold
pursuant thereto or shall have                     otherwise ceased to be Transfer
Restricted Securities), the Company shall use                     commercially reasonable
efforts to obtain the prompt withdrawal of any order                     suspending the
effectiveness thereof, and in any event shall within thirty (30)                     days
of such cessation of effectiveness amend the Shelf Registration Statement
                    in a manner reasonably expected to obtain the withdrawal of the order
suspending                     the effectiveness thereof, or file an additional Shelf
Registration Statement                     covering all of the securities that as of the
date of such filing are Transfer                     Restricted Securities ( a “Subsequent
Shelf Registration                     Statement”). If a Subsequent Shelf
Registration Statement is filed, the                     Company shall use commercially
reasonable efforts to cause the Subsequent Shelf                     Registration
Statement to become effective as promptly as is practicable after
                    such filing and to keep such Registration Statement (or subsequent
Shelf                     Registration Statement) continuously effective until the end of
the                     Effectiveness Period.  

5 

	 	        (d)       
                    The Company shall supplement and amend the Shelf Registration
Statement if                     required by the rules, regulations or instructions
applicable to the                     registration form used by the Company for such
Shelf Registration Statement, if                     required by the Securities Act or as
reasonably requested by the Initial                     Purchasers or by the Trustee on
behalf of the Holders of the Transfer Restricted                     Securities covered
by such Shelf Registration Statement.  

	 	        (e)       
                    Each Holder agrees that if such Holder wishes to sell Transfer
Restricted                     Securities pursuant to a Shelf Registration Statement and
related Prospectus, it                     will do so only in accordance with this
Section 2(e) and Section 4(b). Each                     Holder wishing to sell Transfer
Restricted Securities pursuant to a Shelf                     Registration Statement and
related Prospectus must deliver a Notice and                     Questionnaire to the
Company. In order to be named as a selling securityholder                     in the
Prospectus at the time of effectiveness of the Shelf Registration
                    Statement, the Notice and Questionnaire must be delivered at least
ten (10)                     Business Days prior to the effectiveness of the Shelf
Registration Statement.                     From and after the date the Shelf
Registration Statement is declared effective,                     the Company shall, upon
the later of (x) thirty (30) Business Days after the                     date a Notice
and Questionnaire is delivered (but no earlier than thirty (30)
                    Business Days after effectiveness) or (y) thirty (30) Business Days
after the                     expiration of any Suspension Period in effect when the
Notice and Questionnaire                     is delivered or put into effect within
thirty (30) Business Days of such                     delivery date:  

	 	        (i)       
                    if required by applicable law, file with the SEC a post-effective
amendment to                     the Shelf Registration Statement or prepare and, if
required by applicable law,                     file a supplement to the related
Prospectus or a supplement or amendment to any                     document incorporated
therein by reference or file any other required document                     so that the
Holder delivering such Notice and Questionnaire is named as a                     selling
securityholder in the Shelf Registration Statement and the related
                    Prospectus in such a manner as to permit such Holder to deliver such
Prospectus                     to purchasers of the Transfer Restricted Securities in
accordance with                     applicable law and, if the Company shall file a
post-effective amendment to the                     Shelf Registration Statement, use
commercially reasonable efforts to cause such                     post-effective
amendment to be declared effective under the Securities Act as
                    promptly as is practicable, but in any event by the date (the “Amendment
                    Effectiveness Deadline Date”) that is sixty (60) days after
the date                     such post effective amendment is required by this clause to
be filed:  

	 	        (ii)      
                    provide such Holder copies of the any documents filed pursuant to
Section                     2(e)(i); and  

6 

	 	        (iii)     
                    notify such Holder as promptly as practicable after the effectiveness
under the                     Securities Act of any post-effective amendment filed
pursuant to Section                     2(e)(i);  

provided that if such Notice
and Questionnaire is delivered during a Suspension Period, the Company shall so inform the
Holder delivering such Notice and Questionnaire and shall take the actions set forth in
clauses (i), (ii) and (iii) above upon expiration of the Suspension Period in accordance
with Section 4(b). Notwithstanding anything contained herein to the contrary, (i) the
Company shall be under no obligation to name any Holder that is not a Notice Holder as a
selling securityholder in any Registration Statement or related Prospectus and (ii) the
Amendment Effectiveness Deadline Date shall be extended by up to ten (10) Business Days
from the Expiration of a Suspension Period (and the Company shall incur no obligation to
pay Liquidated Damages during such extension) if such Suspension Period shall be in effect
on the Amendment Effectiveness Deadline Date. 

         3.       Liquidated
Damages.  

	 	        (a)       
               Each event referred to in the following clauses (i) through (vi), is a
               “Registration Default”:  

	 	        (i)       
               the Shelf Registration Statement is not filed with the Commission prior to
or on                the Shelf Filing Deadline;  

	 	        (ii)      
               the Shelf Registration Statement has not been declared effective by the
               Commission prior to or on the Effectiveness Target Date;  

	 	        (iii)     
               the Company has failed to perform its obligations set forth in Section
2(e)                within the time period required therein;  

	 	        (iv)      
               any post-effective amendment to a Shelf Registration filed pursuant to
Section                2(e)(i) has not become effective under the Securities Act on or
prior to the                Amendment Effectiveness Deadline Date;  

	 	        (v)       
               except as provided in Section 4(b)(i) hereof, the Shelf Registration
Statement                is filed and declared effective but, during the Effectiveness
Period, shall                thereafter cease to be effective or fail to be usable for
its intended purpose                without being succeeded within five Business Days by
a post-effective amendment                to the Shelf Registration Statement, a
supplement to the Prospectus or a report                filed with the Commission
pursuant to Section 13(a), 13(c), 14 or 15(d) of the                Exchange Act that
cures such failure and, in the case of a post-effective                amendment, is
itself immediately declared effective; or  

7 

	 	        (vi)      
               (A) prior to or on the 45th or 60th day, as the case may be, of any
Suspension                Period, such suspension has not been terminated or (B)
Suspension Periods exceed                an aggregate of 120 days in any 360 day period.  

	 	        (b)       
               If a Registration Default occurs, other than a Registration Default
relating to                a failure to file or have an effective Shelf Registration
Statement with respect                to shares of Common Stock issuable upon conversion
of the Notes that are                Transfer Restricted Securities:  

	 	        (1)       
               the Company hereby agrees to pay interest (“Liquidated
               Damages”) with respect to the Notes that are Transfer Restricted
               Securities from and including the day following beginning of the
Registration                Default to but excluding the earlier of (a) the day on which
the Registration                Default has been cured and (b) the date the Shelf
Registration Statement is no                longer required to be kept effective,
accruing at a rate (i) with respect to the                first 90-day period during
which a Registration Default shall have occurred and                be continuing, equal
to 0.25% per annum of the aggregate principal amount of the                Notes, and
(ii) with respect to the period commencing on the 91st day following                the
day the Registration Default shall have occurred and be continuing, equal to
               0.50% per annum of the aggregate principal amount of the Notes; provided               that
in no event shall Liquidated Damages accrue at a rate per year exceeding
               0.50% of the aggregate principal amount of the Notes; and  

	 	        (2)       
               The Company hereby agrees in respect of each Note that is a Transfer
Restricted                Security submitted by a Holder for conversion during the
existence of such                Registration Default, (a) to issue and deliver to such
Holder additional shares                of Common Stock equal to 3% of the Applicable
Conversion Rate (as defined in the                Indenture) for each $1,000 principal
amount of Notes (except to the extent the                Company elects to deliver cash
upon conversion in accordance with the terms of                the Indenture) and (b) to
pay on the settlement date with respect to such                conversion, interest
accruing for each day commencing on (and including) the                first day of the
Registration Default and ending on (but excluding) such                settlement date at
a rate per annum (i) with respect to the first 90-day period                during which
a Registration Default shall have occurred and be continuing, equal                to
0.25% per annum of the aggregate principal amount of the Notes, and (ii) with
               respect to the period commencing on the 91st day following the day the
               Registration Default shall have occurred and be continuing, equal to 0.50%
per                annum of the aggregate principal amount of the Notes; provided that
in no                event shall Liquidated Damages accrue at a rate per year exceeding
0.50% of the                aggregate principal amount of the Notes. Any such Holder will
not be entitled to                received Liquidated Damages on such Common Stock.  

8 

         In
respect of Common Stock each Holder of Common Stock will not be entitled to any Liquidated
Damages. 

	 	        (c)       All
accrued Liquidated Damages shall be paid in arrears to Record Holders by the
          Company on each Liquidated Damages Payment Date. Upon the cure of all
          Registration Defaults relating to any particular Note the accrual of Liquidated
          Damages with respect to such Note will cease.  

         All
obligations of the Company set forth in this Section 3 that are outstanding with respect
to any Transfer Restricted Security at the time such security ceases to be a Transfer
Restricted Security shall survive until such time as all such obligations with respect to
such Transfer Restricted Security shall have been satisfied in full. 

         The
Liquidated Damages set forth above shall be the exclusive remedy available to the Holders
of Transfer Restricted Securities for each Registration Default. 

         4.       Registration
Procedures.  

	 	        (a)       
                    In connection with the Shelf Registration Statement, the Company
shall comply                     with all the provisions of Section 4(b) hereof and shall
use commercially                     reasonable efforts to effect such registration to
permit the sale of the                     Transfer Restricted Securities, and pursuant
thereto, shall as expeditiously as                     possible prepare and file with the
Commission a Shelf Registration Statement                     relating to the
registration on any appropriate form under the Securities Act.  

	 	        (b)       
                    In connection with the Shelf Registration Statement and any
Prospectus required                     by this Agreement to permit the sale or resale of
Transfer Restricted                     Securities, the Company shall:  

	 	        (i)       
                    Subject to any notice by the Company in accordance with this Section
4(b) of the                     existence of any fact or event of the kind described in
Section 4(b)(iii)(D),                     use commercially reasonable efforts to keep the
Shelf Registration Statement                     continuously effective during the
Effectiveness Period; upon the occurrence of                     any event that would
cause the Shelf Registration Statement or the Prospectus                     contained
therein (A) to contain a material misstatement or omission or (B) not
                    to be effective and usable for resale of Transfer Restricted
Securities during                     the Effectiveness Period, the Company shall file
promptly an appropriate                     amendment to the Shelf Registration
Statement, a supplement to the Prospectus or                     a report filed with the
Commission pursuant to Section 13(a), 13(c), 14 or 15(d)                     of the
Exchange Act, in the case of clause (A), correcting any such misstatement
                    or omission, and, in the case of either clause (A) or (B), use
commercially                     reasonable efforts to cause such amendment to be
declared effective and the                     Shelf Registration Statement and the
related Prospectus to become usable for                     their intended purposes as
soon as practicable thereafter. Notwithstanding the                     foregoing, the
Company may suspend the effectiveness of the Shelf Registration
                    Statement by written notice to the Holders for a period not to exceed
an                     aggregate of 45 days in any 90-day period (each such period, a
                    “Suspension Period”) if:  

9 

	 	        (x)        an
event occurs and is continuing as a result of which the Shelf Registration
               Statement, the Prospectus, any amendment or supplement thereto, or any
document                incorporated by reference therein would, in the Company’s
judgment, contain                an untrue statement of a material fact or omit to state
a material fact required                to be stated therein or necessary to make the
statements therein not misleading;                and  

	 	        (y)                   the
Company determines in good faith that the disclosure of such event at such
               time would be prejudicial to or contrary to the interests of the Company
and its                subsidiaries;  

	 	
provided
that, in the event the disclosure relates to a previously undisclosed proposed or pending
material business transaction, the disclosure of which the Company determines in good
faith would be reasonably likely to impede the Company’s ability to consummate such
transaction, the Company may extend a Suspension Period from 45 days to 60 days; provided,
however, that Suspension Periods shall not exceed an aggregate of 120 days in any 360-day
period. The Company shall not be required to specify in the written notice to the Holders
the nature of the event giving rise to the Suspension Period. 

	 	        (ii)      
               Prepare and file with the Commission such amendments and post-effective
               amendments to the Shelf Registration Statement as may be necessary to keep
the                Shelf Registration Statement effective during the Effectiveness
Period; cause                the Prospectus to be supplemented by any required Prospectus
supplement, and as                so supplemented to be filed pursuant to Rule 424 under
the Securities Act, and                to comply fully with the applicable provisions of
Rules 424 and 430A under the                Securities Act in a timely manner; and comply
with the provisions of the                Securities Act with respect to the disposition
of all Notes covered by the Shelf                Registration Statement during the
applicable period in accordance with the                intended method or methods of
distribution by the sellers thereof set forth in                the Shelf Registration
Statement or supplement to the Prospectus.  

10 

	 	        (iii)     
               Advise the Notice Holders promptly and, if requested by such Notice
Holders, to                confirm such advice in writing, except as provided in clause
(D) below:  

	 	        (A)       
               when the Prospectus or any Prospectus supplement or post-effective
amendment has                been filed, and, with respect to the Shelf Registration
Statement or any                post-effective amendment thereto, when the same has
become effective,  

	 	        (B)       
               of any request by the Commission for amendments to the Shelf Registration
               Statement or amendments or supplements to the Prospectus or for additional
               information relating thereto,  

	 	        (C)       
               of the issuance by the Commission of any stop order suspending the
effectiveness                of the Shelf Registration Statement under the Securities Act
or of the                suspension by any state securities commission of the
qualification of the                Transfer Restricted Securities for offering or sale
in any jurisdiction, or the                initiation of any proceeding for any of the
preceding purposes, or  

	 	        (D)       
               of the existence of any fact or the happening of any event, during the
               Effectiveness Period, that makes any statement of a material fact made in
the                Shelf Registration Statement, the Prospectus, any amendment or
supplement                thereto, or any document incorporated by reference therein
untrue, or that                requires the making of any additions to or changes in the
Shelf Registration                Statement or the Prospectus in order to make the
statements therein not                misleading.  

	 	
If
at any time the Commission shall issue any stop order suspending the effectiveness of the
Shelf Registration Statement, or any state securities commission or other regulatory
authority shall issue an order suspending the qualification or exemption from
qualification of the Transfer Restricted Securities under state securities or Blue Sky
laws, the Company shall use its best efforts to obtain the withdrawal or lifting of such
order at the earliest possible time and will provide to each Holder who is named in the
Shelf Registration Statement prompt notice of the withdrawal of any such order. 

11 

	 	        (iv)      
                    Upon reasonable notice, for a reasonable period prior to the filing
of the Shelf                     Registration Statement, and throughout the Effective
Period, make available at                     reasonable times for inspection by one or
more representatives of the Notice                     Holders, designated in writing by
a Majority of Holders whose Transfer                     Restricted Securities are
included in the Shelf Registration Statement, and any                     attorney or
accountant retained by such Notice Holders, all financial and other
                    records, pertinent corporate documents and properties of the Company
as shall be                     reasonably necessary to enable them to conduct a
reasonable investigation within                     the meaning of Section 11 of the
Securities Act, and cause the Company’s                     officers, directors,
managers and employees to supply all information reasonably                     requested
by any such representative or representatives of the Notice Holders,
                    attorney or accountant in connection therewith; provided, however,
that                     the Company shall have no obligation to deliver information to
any Notice Holder                     or representative pursuant to this Section 4(b)(iv)
unless such Notice Holder or                     representative shall have executed and
delivered a confidentiality agreement in                     a form acceptable to the
Company relating to such information.  

	 	        (v)       
                    If reasonably requested by the Initial Purchasers or any Notice
Holder, promptly                     incorporate in the Shelf Registration Statement or
Prospectus, pursuant to a                     supplement or post-effective amendment if
necessary, such information as such                     Notice Holders may reasonably
request to have included therein, including,                     without limitation,
information relating to the “Plan of                     Distribution” of
the Transfer Restricted Securities; provided                    that the Company
shall not be required to take any actions under this Section                     4(b)(v)
that are not, in the reasonable opinion of counsel for the Company,
                    required by, or in compliance with, applicable law.  

	 	        (vi)      
                    Furnish to each Notice Holder upon their request, without charge, at
least one                     conformed copy (or an electronic copy thereof) of the Shelf
Registration                     Statement, as first filed with the Commission, and of
each amendment thereto but                     excluding schedules and any documents
incorporated by reference therein or                     exhibits thereto (or exhibits
incorporated in such exhibits by reference) as                     such Person may
request.  

12 

	 	        (vii)     
                    During the Effective Period, deliver to each Notice Holder, without
charge, as                     many copies of the Prospectus (including each preliminary
Prospectus) and any                     amendment or supplement thereto as such Persons
reasonably may request; subject                     to any notice by the Company in
accordance with this Section 4(b) of the                     existence of any fact or
event of the kind described in Section 4(b)(iii)(D),                     the Company
hereby consents (except during such periods that a Suspension Notice
                    is outstanding and has not been revoked) to the use of the Prospectus
and any                     amendment or supplement thereto by each of the Notice Holders
in connection with                     the offering and the sale of the Transfer
Restricted Securities covered by the                     Prospectus or any amendment or
supplement thereto in the manner set forth                     therein.  

	 	        (viii)    
                    Before any public offering of Transfer Restricted Securities,
cooperate with the                     Notice Holders and their counsel in connection
with the registration and                     qualification of the Transfer Restricted
Securities under the securities or Blue                     Sky laws of such
jurisdictions in the United States as the Notice Holders may
                    reasonably request and do any and all other acts or things necessary
or                     advisable to enable the disposition in such jurisdictions of the
Transfer                     Restricted Securities covered by the Shelf Registration
Statement; provided, however, that the Company shall not be required (A) to
register or qualify                     as a foreign corporation or a dealer of
securities where it is not now so                     qualified or to take any action
that would subject it to the service of process                     in any jurisdiction
where it is not now so subject or (B) to subject itself to                     general or
unlimited service of process or to taxation in any such jurisdiction
                    if they are not now so subject.  

	 	        (ix)      
                    Cooperate with the Notice Holders to facilitate the timely
preparation and                     delivery of certificates representing Transfer
Restricted Securities to be sold                     and not bearing any restrictive
legends (unless required by applicable                     securities laws); and enable
such Transfer Restricted Securities to be in such                     denominations and
registered in such names as the Notice Holders may request at                     least
two Business Days before any sale of Transfer Restricted Securities.  

	 	        (x)       
                    Use its best efforts to cause the Transfer Restricted Securities
covered by the                     Shelf Registration Statement to be registered with or
approved by such other                     U.S. governmental agencies or authorities as
may be necessary to enable the                     seller or sellers thereof to
consummate the disposition of such Transfer                     Restricted Securities.  

13 

	 	        (xi)      
                    Subject to Section 4(b)(i) hereof, if any fact or event contemplated
by Section                     4(b)(iii)(D) hereof shall exist or have occurred, use its
best efforts to                     prepare a supplement or post-effective amendment to
the Shelf Registration                     Statement or related Prospectus or any
document incorporated therein by                     reference or file any other required
document so that, as thereafter delivered                     to the purchasers of
Transfer Restricted Securities, the Prospectus will not                     contain an
untrue statement of a material fact or omit to state any material
                    fact required to be stated therein or necessary to make the
statements therein,                     in light of the circumstances in which they are
made, not misleading.  

	 	        (xii)     
                    Provide CUSIP numbers for all Transfer Restricted Securities not
later than the                     effective date of the Shelf Registration Statement and
provide the Trustee under                     the Indenture with certificates for the
Notes that are in a form eligible for                     deposit with The Depository
Trust Company.  

	 	        (xiii)    
                    Cooperate and assist in any filings required to be made with the NASD
and in the                     performance of any due diligence investigation by any
underwriter that is                     required to be retained in accordance with the
rules and regulations of the                     NASD.  

	 	        (xiv)     
                    Otherwise use commercially reasonable efforts to comply with all
applicable                     rules and regulations of the Commission and all reporting
requirements under the                     rules and regulations of the Exchange Act.  

	 	        (xv)      
                    Cause the Indenture to be qualified under the TIA not later than the
effective                     date of the Shelf Registration Statement required by this
Agreement, and, in                     connection therewith, cooperate with the Trustee
and the holders of Notes to                     effect such changes to the Indenture as
may be required for such Indenture to be                     so qualified in accordance
with the terms of the TIA; and execute and use                     commercially
reasonable efforts to cause the Trustee thereunder to execute all
                    documents that may be required to effect such changes and all other
forms and                     documents required to be filed with the Commission to
enable such Indenture to                     be so qualified in a timely manner.  

	 	        (xvi)     
                    Cause all Common Stock covered by the Shelf Registration Statement to
be listed                     or quoted, as the case may be, on each securities exchange
or automated                     quotation system on which Common Stock is then listed or
quoted.  

	 	        (xvii)    
                    Make available to each Holder upon written request each document
filed with the                     Commission pursuant to the requirements of Section 13
and Section 15 of the                     Exchange Act after the effective date of the
Shelf Registration Statement,                     unless such document is available
through the Commission’s EDGAR system.  

14 

	 	        (c)       
                    Each Holder agrees by acquisition of a Transfer Restricted Security
that, upon                     receipt of any notice (a “Suspension Notice”)
from the Company                     of the existence of any fact of the kind described
in Section 4(b)(iii)(D)                     hereof, such Holder will forthwith
discontinue disposition of Transfer                     Restricted Securities pursuant to
the Shelf Registration Statement until:  

	 	        (i)       
                    such Holder has received copies of the supplemented or amended
Prospectus                     contemplated by Section 4(b)(xi) hereof; or  

	 	        (ii)      
                    such Holder is advised in writing by the Company that the use of the
Prospectus                     may be resumed, and has received copies of any additional
or supplemental                     filings that are incorporated by reference in the
Prospectus.  

If so directed by the Company, each
Holder will deliver to the Company (at the Company’s expense) all copies, other than
permanent file copies then in such Holder’s possession, of the Prospectus covering
such Transfer Restricted Securities that was current at the time of receipt of such notice
of suspension. 

	 	        (d)       Each
Holder agrees by acquisition of a Transfer Restricted Security, that no           Holder
shall be entitled to sell any of such Transfer Restricted Securities           pursuant
to a Registration Statement, or to receive a Prospectus relating           thereto,
unless such Holder has furnished the Company with a Notice and           Questionnaire as
required pursuant to Section 2(e) hereof (including the           information required to
be included in such Notice and Questionnaire) and the           information set forth in
the next sentence. Each Notice Holder agrees promptly           to furnish to the Company
all information required to be disclosed in order to           make the information
previously furnished to the Company by such Notice Holder           not misleading and
any other information regarding such Notice Holder and the           distribution of such
Transfer Restricted Securities as the Company may from time           to time reasonably
request in writing. Any sale of any Transfer Restricted           Securities by any
Holder shall constitute a representation and warranty by such           Holder that the
information relating to such Holder and its plan of distribution           is as set
forth in the Prospectus delivered by such Holder in connection with           such
disposition, that such Prospectus does not as of the time of such sale           contain
any untrue statement of a material fact relating to or provided by such           Holder
to its plan of distribution and that such Prospectus does not as of the           time of
such sale omit to state any material fact relating to or provided by           such
Holder or its plan of distribution necessary to make the statements in such
          Prospectus, in the light of the circumstances under which they were made not
          misleading.  

15 

	 	        (e)       Each
Holder further agrees not to sell any Transfer Restricted Securities           pursuant
to the Shelf Registration Statement without delivering, or causing to           be
delivered, a Prospectus to the purchaser thereof and to notify the Company,
          within 10 business days of a requested by the Company, of the amount of
Transfer           Restricted Securities sold pursuant to the Shelf Registration
Statement and, in           the absence of a response, the Company may assume that all of
the Holder’s           Transfer Restricted Securities were so sold.  

         5.       Registration
Expenses.  

        All
expenses incident to the Company’s performance of or compliance with this Agreement
shall be borne by the Company regardless of whether a Shelf Registration Statement becomes
effective, including, without limitation: 

	 	        (i)       
                    all registration and filing fees and expenses (including filings made
with the                     NASD);  

	 	        (ii)      
                    all fees and expenses of compliance with federal securities and state
Blue Sky                     or securities laws;  

	 	        (iii)     
                    all expenses of printing (including printing of Prospectuses and
certificates                     for the Common Stock to be issued upon conversion of the
Notes) and the                     Company’s expenses for messenger and delivery
services and telephone;  

	 	        (iv)      
                    all fees and disbursements of counsel to the Company;  

	 	        (v)       
                    all application and filing fees in connection with listing (or
authorizing for                     quotation) the Common Stock on a national securities
exchange or automated                     quotation system pursuant to the requirements
hereof; and  

	 	        (vi)       
                    all fees and disbursements of independent certified public
accountants of the                     Company.  

        The
Company shall bear its internal expenses (including, without limitation, all salaries and
expenses of their officers and employees performing legal, accounting or other duties),
the expenses of any annual audit and the fees and expenses of any Person, including
special experts, retained by the Company. 

         6.       Indemnification
And Contribution. 

	 	        (a)       
                    The Company agrees to indemnify and hold harmless each Holder of
Transfer                     Restricted Securities covered by the Shelf Registration
Statement (including                     each Initial Purchaser), its directors,
officers, and employees and each person,                     if any, who controls any
such Holder within the meaning of the Securities Act or                     the Exchange
Act (each, an “Indemnified Holder”), against any
                    loss, claim, damage, liability or expense, joint or several, or any
action in                     respect thereof (including, but not limited to, any loss,
claim, damage,                     liability or action relating to resales of the
Transfer Restricted Securities),                     to which such Indemnified Holder may
become subject, insofar as any such loss,                     claim, damage, liability or
action arises out of, or is based upon:  

16 

	 	        (i)       
                    any untrue statement or alleged untrue statement of a material fact
contained in                     (A) the Shelf Registration Statement as originally filed
or in any amendment                     thereof, in any Prospectus, or in any amendment
or supplement thereto or (B) any                     blue sky application or other
document or any amendment or supplement thereto                     prepared or executed
by the Company (or based upon written information furnished                     by or on
behalf of the Company expressly for use in such blue sky application or
                    other document or amendment on supplement) filed in any jurisdiction
                    specifically for the purpose of qualifying any or all of the Transfer
Restricted                     Securities under the securities law of any state or other
jurisdiction (such                     application or document being hereinafter called a
“Blue Sky                     Application”); or  

	 	        (ii)      
                    the omission or alleged omission to state therein any material fact
required to                     be stated therein or necessary to make the statements
therein, in the light of                     the circumstances under which they were
made, not misleading,  

and agrees to reimburse each
Indemnified Holder promptly upon demand for any legal or other expenses reasonably
incurred by such Indemnified Holder in connection with investigating, defending, settling,
compromising or paying any such loss, claim, damage, liability, expense or action;
provided, however, that the Company shall not be liable in any such case to the
extent that any such loss, claim, damage, liability or expense arises out of, or is based
upon, any untrue statement or alleged untrue statement or omission or alleged omission
made in reliance upon and in conformity with written information furnished to the Company
by or on behalf of such Holder (or its related Indemnified Holder) specifically for use
therein and provided, further, however, that with respect to any untrue statement
or omission or alleged untrue statement or omission made in any Prospectus (excluding the
correcting amendment or supplement thereto), the indemnity agreement contained in this
Section 6(a) shall not inure to the benefit of any Indemnified Holder from whom the person
asserting any such losses, claims, damages or liabilities received the Transfer Restricted
Securities concerned, to the extent that a Prospectus relating to such Transfer Restricted
Securities were required to be delivered by such holder under the Securities Act in
connection with such purchase and any such loss, claim, damages or liability of such
holder results from the fact that there was not sent or given to such person, at or prior
to the written confirmation of the sale of such Transfer Restricted Securities to such
person, a copy of a subsequent amended or supplemented Prospectus correcting such untrue
statement or omission or alleged untrue statement or omission if the Company had furnished
copies thereof to such Indemnified Holder prior to the required time of delivery of such
Prospectus. The foregoing indemnity agreement is in addition to any liability which the
Company may otherwise have. 

17 

	 	        (b)       
                    Each Holder, severally and not jointly, agrees to indemnify and hold
harmless                     the Company, its directors, officers and employees and each
person, if any, who                     controls the Company within the meaning of the
Securities Act or the Exchange                     Act to the same extent as the
foregoing indemnity from the Company to each such                     Holder, but only
with reference to written information relating to such Holder
                    furnished to the Company by or on behalf of such Holder specifically
for                     inclusion in the documents referred to in the foregoing
indemnity. This                     indemnity agreement set forth in this Section shall
be in addition to any                     liabilities which any such Holder may otherwise
have. In no event shall any                     Holder, its directors, officers or any
person who controls such Holder be liable                     or responsible for any
amount in excess of the amount by which the total amount                     received by
such Holder with respect to its sale of Transfer Restricted
                    Securities pursuant to a Shelf Registration Statement exceeds (i) the
amount                     paid by such Holder for such Transfer Restricted Securities
and (ii) the amount                     of any damages that such Holder, its directors,
officers or any person who                     controls such Holder has otherwise been
required to pay by reason of such untrue                     or alleged untrue statement
or omission or alleged omission.  

	 	        (c)       
                    Promptly after receipt by an indemnified party under this Section 6
of notice of                     any claim or the commencement of any action, the
indemnified party shall, if a                     claim in respect thereof is to be made
against the indemnifying party under this                     Section 6, notify the
indemnifying party in writing of the claim or the                     commencement of
that action; provided, however, that the failure to                     notify the
indemnifying party shall not relieve it from any liability which it
                    may have under this Section 6 except to the extent it has been
materially                     prejudiced by such failure and, provided, further, that
the failure to                     notify the indemnifying party shall not relieve it
from any liability which it                     may have to an indemnified party
otherwise than under this Section 6. If any                     such claim or action
shall be brought against an indemnified party, and it shall                     notify
the indemnifying party thereof, the indemnifying party shall be entitled
                    to participate therein and, to the extent that it wishes, jointly
with any other                     similarly notified indemnifying party, to assume the
defense thereof with                     counsel satisfactory to the indemnified party.
After notice from the                     indemnifying party to the indemnified party of
its election to assume the                     defense of such claim or action, the
indemnifying party shall not be liable to                     the indemnified party under
this Section 6 for any legal or other expenses                     subsequently incurred
by the indemnified party in connection with the defense                     thereof other
than reasonable costs of investigation; provided, however,                    that
the Holders shall have the right to employ a single counsel to represent
                    jointly the Holders and their officers, employees and controlling
persons who                     may be subject to liability arising out of any claim in
respect of which                     indemnity may be sought by the Holders against the
Company under this Section 6                     if the Holders seeking indemnification
shall have been advised by legal counsel                     that there may be one or
more legal defenses available to such Holders and their                     respective
officers, employees and controlling persons that are different from
                    or additional to those available to the Company, and in that event,
the fees and                     expenses of such separate counsel shall be paid by the
Company. No indemnifying                     party shall:  

18 

	 	        (i)       
                    without the prior written consent of the indemnified parties (which
consent                     shall not be unreasonably withheld) settle or compromise or
consent to the entry                     of any judgment with respect to any pending or
threatened claim, action, suit or                     proceeding in respect of which
indemnification or contribution may be sought                     hereunder (whether or
not the indemnified parties are actual or potential                     parties to such
claim or action), unless such settlement, compromise or consent
                    includes an unconditional release of each indemnified party from all
liability                     arising out of such claim, action, suit or proceeding, or  

	 	        (ii)      
                    be liable for any settlement of any such action effected without its
written                     consent (which consent shall not be unreasonably withheld),
but if settled with                     its written consent or if there be a final
judgment for the plaintiff in any                     such action, the indemnifying party
agrees to indemnify and hold harmless any                     indemnified party from and
against any loss of liability by reason of such                     settlement or
judgment.  

	 	        (d)       
                    The indemnifying party under this Section shall not be liable for any
settlement                     of any proceeding effected without its written consent,
which shall not be                     withheld unreasonably, but if settled with such
consent or if there is a final                     judgment for the plaintiff, the
indemnifying party agrees to indemnify the                     indemnified party against
any loss, claim, damage, liability or expense by                     reason of such
settlement or judgment. Notwithstanding the foregoing sentence,                     if at
any time an indemnified party shall have requested an indemnifying party
                    to reimburse the indemnified party for fees and expenses of counsel
as                     contemplated by Section 6(c) hereof, the indemnifying party agrees
that it shall                     be liable for any settlement of any proceeding effected
without its written                     consent if (i) such settlement is entered into
more than 30 days after receipt                     by such indemnifying party of the
aforesaid request and (ii) such indemnifying                     party shall not have
reimbursed the indemnified party in accordance with such                     request
prior to the date of such settlement. No indemnifying party shall,
                    without the prior written consent of the indemnified party, effect
any                     settlement, compromise or consent to the entry of judgment in any
pending or                     threatened action, suit or proceeding in respect of which
any indemnified party                     is or could have been a party and indemnity was
or could have been sought                     hereunder by such indemnified party, unless
such settlement, compromise or                     consent (x) includes an unconditional
release of such indemnified party from all                     liability on claims that
are the subject matter of such action, suit or                     proceeding and (y)
does not include a statement as to or an admission of fault,
                    culpability or a failure to act by or on behalf of any indemnified
party.  

19 

	 	        (e)       
                    If the indemnification provided for in this Section 6 shall for any
reason be                     unavailable or insufficient to hold harmless an indemnified
party under Section                     6(a) or 6(b) in respect of any loss, claim,
damage or liability (or action in                     respect thereof) referred to
therein, each indemnifying party shall, in lieu of                     indemnifying such
indemnified party, contribute to the amount paid or payable by                     such
indemnified party as a result of such loss, claim, damage or liability (or
                    action in respect thereof):  

	 	        (i)       
                    in such proportion as is appropriate to reflect the relative benefits
received                     by the Company from the offering and sale of the Transfer
Restricted Securities                     on the one hand and a Holder with respect to
the sale by such Holder of the                     Transfer Restricted Securities on the
other, or  

	 	        (ii)      
                    if the allocation provided by Section (6)(d)(i) is not permitted by
applicable                     law, in such proportion as is appropriate to reflect not
only the relative                     benefits referred to in Section 6(d)(i) but also
the relative fault of the                     Company on the one hand and the Holders on
the other in connection with the                     statements or omissions or alleged
statements or alleged omissions that resulted                     in such loss, claim,
damage or liability (or action in respect thereof), as well                     as any
other relevant equitable considerations.  

The relative benefits received by the
Company on the one hand and a Holder on the other with respect to such offering and such
sale shall be deemed to be in the same proportion as the total net proceeds from the
offering of the Notes purchased under the Purchase Agreement (before deducting expenses)
received by the Company, on the one hand, bear to the total proceeds received by such
Holder with respect to its sale of Transfer Restricted Securities on the other. The
relative fault of the parties shall be determined by reference to whether the untrue or
alleged untrue statement of a material fact or the omission or alleged omission to state a
material fact relates to information supplied by the Company on the one hand or the
Holders on the other, the intent of the parties and their relative knowledge, access to
information and opportunity to correct or prevent such statement or omission. The Company
and each Holder agree that it would not be just and equitable if the amount of
contribution pursuant to this Section 6(d) were determined by pro rata allocation
or by any other method of allocation that does not take into account the equitable
considerations referred to in the first sentence of this paragraph (d). 

20 

         The
amount paid or payable by an indemnified party as a result of the loss, claim, damage or
liability, or action in respect thereof, referred to above in this Section 6 shall be
deemed to include, for purposes of this Section 6, any legal or other expenses reasonably
incurred by such indemnified party in connection with investigating or defending or
preparing to defend any such action or claim. 

         Notwithstanding
the provisions of this Section 6, no Holder shall be required to contribute any amount in
excess of the amount by which the total price at which the Transfer Restricted Securities
purchased by it were resold exceeds the amount of any damages which such Holder has
otherwise been required to pay by reason of any untrue or alleged untrue statement or
omission or alleged omission. No Person guilty of fraudulent misrepresentation (within the
meaning of Section 11(f) of the Securities Act) shall be entitled to contribution from any
Person who was not guilty of such fraudulent misrepresentation. The Holders’
obligations to contribute as provided in this Section 6(d) are several and not joint. 

	 	        (f)       
                    The provisions of this Section 6 shall remain in full force and
effect,                     regardless of any investigation made by or on behalf of any
Holder or the                     Company or any of the officers, directors or
controlling persons referred to in                     Section 6 hereof, and will survive
the sale by a Holder of Transfer Restricted                     Securities.  

         7.       Rule
144A and Rule 144. The Company agrees with each Holder, for so long
                    as any Transfer Restricted Securities remain outstanding and during
any period                     in which the Company (i) is not subject to Section 13 or
15(d) of the Exchange                     Act, to make available, upon request of any
Holder, to such Holder or beneficial                     owner of Transfer Restricted
Securities in connection with any sale thereof and                     any prospective
purchaser of such Transfer Restricted Securities designated by                     such
Holder or beneficial owner, the information required by Rule 144A(d)(4)
                    under the Securities Act in order to permit resales of such Transfer
Restricted                     Securities pursuant to Rule 144A, and (ii) is subject to
Section 13 or 15 (d) of                     the Exchange Act, to make all filings
required thereby in a timely manner in                     order to permit resales of
such Transfer Restricted Securities pursuant to Rule                     144.  

         8.       No
Participation In Underwritten Registrations. No Holder may participate
                    in any Underwritten Registration hereunder.  

         9.       
Miscellaneous.  

	 	        (a)       
Remedies. Nothing shall preclude a Notice Holder or a Holder of Transfer
                    Restricted Securities from pursuing or obtaining specific performance
or other                     equitable relief with respect to this Agreement.  

21 

	 	        (b)       
Actions Affecting Transfer Restricted Securities. The Company shall not,
                    directly or indirectly, take any action with respect to the Transfer
Restricted                     Securities as a class that would adversely affect the
ability of the Holders of                     Transfer Restricted Securities to include
such Transfer Restricted Securities in                     a registration undertaken
pursuant to this Agreement.  

	 	        (c)       
No Inconsistent Agreements. The Company has not, as of the date hereof,
                    entered into, nor shall it, on or after the date hereof, enter into,
any                     agreement with respect to its securities that is inconsistent
with the rights                     granted to the Holders in this Agreement or otherwise
conflicts with the                     provisions hereof. In addition, the Company shall
not grant to any of its                     securityholders (other than the Holders of
Transfer Restricted Securities in                     such capacity) the right to include
any of its securities in the Shelf                     Registration Statement provided
for in this Agreement other than the Transfer                     Restricted Securities.  

	 	        (d)       
Amendments and Waivers. This Agreement may not be amended, modified or
                    supplemented, and waivers or consents to or departures from the
provisions                     hereof may not be given, unless the Company has obtained
the written consent of                     a Majority of Holders at the time outstanding;
provided, however,                     that with respect to any matter that
directly or indirectly adversely affects                     the rights of any Initial
Purchaser hereunder, the Company shall obtain the                     written consent of
each such Initial Purchaser against which such amendment,
                    qualification, supplement, waiver or consent is to be effective.
Notwithstanding                     the foregoing (except the foregoing proviso), a
waiver or consent to depart from                     the provisions hereof, with respect
to a matter, which relates exclusively to                     the rights of Holders whose
securities are being sold pursuant to a Shelf                     Registration Statement
and does not directly or indirectly adversely affect the                     rights of
other Holders, may be given by the Majority Holders, determined on the
                    basis of Notes being sold rather than registered under such Shelf
Registration                     Statement.  

	 	        (e)       
Notices. All notices and other communications provided for or permitted
                    hereunder shall be made in writing by hand delivery, first class mail
                    (registered or certified, return receipt requested), telex, facsimile
                    transmission, or air courier guaranteeing overnight delivery:  

	 	        (i)       
                    if to a Holder, at the address set forth on the records of the
registrar under                     the Indenture or the transfer agent of the Common
Stock, as the case may be; and  

22 

	 	        (ii)      
                    if to the Company, initially at its address set forth in the Purchase
Agreement,  

	 	
With
a copy to: 

	 	
Foley
& Lardner LLP
777 East Wisconsin Avenue

Milwaukee, Wisconsin 53202

Attn:  Benjamin F. Garmer, III 

         All
such notices and communications shall be deemed to have been duly given: at the time
delivered by hand, if personally delivered; five Business Days after being deposited in
the mail, postage prepaid, if mailed; when answered back, if telexed; when receipt
acknowledged, if transmitted by facsimile; and on the next Business Day, if timely
delivered to an air courier guaranteeing overnight delivery. 

         Any
party hereto may change the address for receipt of communications by giving written notice
to the others. 

	 	        (f)       Successors
and Assigns. This Agreement shall inure to the benefit of and           be binding
upon the successors and assigns of each of the parties, including           without
limitation and without the need for an express assignment, subsequent           Holders
of Transfer Restricted Securities. The Company hereby agrees to extend           the
benefit of this Agreement to any Holder and any such Holder may specifically
          enforce the provisions of this Agreement as if an original party hereto.  

	 	        (g)       Counterparts. This
Agreement may be executed in any number of           counterparts and by the parties
hereto in separate counterparts, each of which           when so executed shall be deemed
to be an original and all of which taken           together shall constitute one and the
same agreement.  

	 	        (h)       Notes
Held by the Company or Their Affiliates. Whenever the consent or           approval
of Holders of a specified percentage of Transfer Restricted Securities           is
required hereunder, Transfer Restricted Securities held by the Company or its
          Affiliates (other than subsequent Holders if such subsequent Holders are deemed
          to be Affiliates solely by reason of their holding of such Notes) shall not be
          counted in determining whether such consent or approval was given by the
Holders           of such required percentage.  

	 	        (i)       Headings. The
headings in this Agreement are for convenience of reference           only and shall not
limit or otherwise affect the meaning hereof.  

	 	        (j)       Governing
Law. This Agreement shall be governed by and construed in           accordance with
the law of the State of New York.  

23 

	 	        (k)       Severability. If
any one or more of the provisions contained herein, or           the application thereof
in any circumstance, is held invalid, illegal or           unenforceable, the validity,
legality and enforceability of any such provision           in every other respect and of
the remaining provisions contained herein shall           not be affected or impaired
thereby, it being intended that all of the rights           and privileges of the parties
shall be enforceable to the fullest extent           permitted by law.  

	 	        (l)       Entire
Agreement. This Agreement is intended by the parties as a final           expression
of their agreement and intended to be a complete and exclusive           statement of the
agreement and understanding of the parties hereto in respect of           the subject
matter contained herein. There are no restrictions, promises,           warranties or
undertakings, other than those set forth or referred to herein           with respect to
the registration rights granted by the Company with respect to           the Transfer
Restricted Securities. This Agreement supersedes all prior           agreements and
understandings between the parties with respect to such subject           matter.  

24 

        IN
WITNESS WHEREOF, the parties have executed this Agreement as of the date first written
above. 

		
REGAL-BELOIT CORPORATION

		By:   	/s/ Kenneth F. Kaplan   

		Name:	Kenneth F. Kaplan
		Title:	Vice President, Chief Financial
			Officer and Secretary
			

		BANC OF AMERICA SECURITIES LLC

DEUTSCHE BANK SECURITIES INC.

WACHOVIA CAPITAL MARKETS, LLC

ROBERT W. BAIRD & CO. INCORPORATED

Acting severally on behalf of themselves 
and the several Initial Purchasers

By BANC OF AMERICA SECURITIES LLC

		By:   	/s/ Derek Dillon   

			Authorized Representative
 

25

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