Document:

Exhibit 4.1

 

Execution Copy

 

 

AMENDED AND RESTATED

 

INDENTURE

 

Dated as of September 10, 2009

 

Among

 

HUNTSMAN INTERNATIONAL LLC, as Issuer,

 

each of the Guarantors named herein

 

and

 

Wilmington Trust FSB, as Trustee

 

 

$600,000,000

 

5 1⁄2 % Senior Notes due 2016

 

 

 

TABLE OF CONTENTS

 

	
   

  	
  Page

  
	
   

  	
   

  
	
  ARTICLE I

  	
   

  
	
  DEFINITIONS AND INCORPORATION BY REFERENCE

  	
   

  
	
   

  	
   

  
	
  Section 1.01

  	
  Definitions

  	
  1

  
	
  Section 1.02

  	
  Incorporation by Reference of TIA

  	
  27

  
	
  Section 1.03

  	
  Rules of Construction

  	
  28

  
	
   

  	
   

  	
   

  
	
  ARTICLE II

  	
   

  
	
  THE NOTES

  	
   

  
	
   

  	
   

  
	
  Section 2.01

  	
  Form and Dating

  	
  28

  
	
  Section 2.02

  	
  Execution and Authentication; Aggregate Principal Amount

  	
  29

  
	
  Section 2.03

  	
  Registrar and Paying Agent

  	
  30

  
	
  Section 2.04

  	
  Paying Agent To Hold Assets in Trust

  	
  31

  
	
  Section 2.05

  	
  Holder Lists

  	
  31

  
	
  Section 2.06

  	
  Transfer and Exchange

  	
  31

  
	
  Section 2.07

  	
  Replacement Notes

  	
  32

  
	
  Section 2.08

  	
  Outstanding Notes

  	
  32

  
	
  Section 2.09

  	
  Treasury Notes

  	
  33

  
	
  Section 2.10

  	
  [Intentionally Omitted]

  	
  33

  
	
  Section 2.11

  	
  Cancellation

  	
  33

  
	
  Section 2.12

  	
  Defaulted Interest

  	
  33

  
	
  Section 2.13

  	
  CUSIP Numbers

  	
  34

  
	
  Section 2.14

  	
  Deposit of Moneys

  	
  34

  
	
  Section 2.15

  	
  Book-Entry Provisions for Global Securities

  	
  34

  
	
  Section 2.16

  	
  Transfer and Exchange of Securities

  	
  35

  
	
  Section 2.17

  	
  Special Transfer Provisions

  	
  39

  
	
  Section 2.18

  	
  Issuance of Additional Notes

  	
  39

  
	
   

  	
   

  	
   

  
	
  ARTICLE III

  	
   

  
	
  REDEMPTION

  	
   

  
	
   

  	
   

  	
   

  
	
  Section 3.01

  	
  Notices to Trustee

  	
  40

  
	
  Section 3.02

  	
  Selection of Notes To Be Redeemed

  	
  40

  
	
  Section 3.03

  	
  Notice of Redemption

  	
  40

  
	
  Section 3.04

  	
  Effect of Notice of Redemption

  	
  41

  
	
  Section 3.05

  	
  Deposit of Redemption Price

  	
  41

  
	
  Section 3.06

  	
  Notes Redeemed in Part

  	
  42

  

 

i

 

	
  ARTICLE IV

  	
   

  
	
  COVENANTS

  	
   

  
	
   

  	
   

  	
   

  
	
  Section 4.01

  	
  Payment of Notes

  	
  42

  
	
  Section 4.02

  	
  Maintenance of Office or Agency

  	
  42

  
	
  Section 4.03

  	
  Limitation on Restricted Payments

  	
  42

  
	
  Section 4.04

  	
  Corporate Existence

  	
  44

  
	
  Section 4.05

  	
  Payment of Taxes and Other Claims

  	
  44

  
	
  Section 4.06

  	
  Maintenance of Properties and Insurance

  	
  44

  
	
  Section 4.07

  	
  Compliance Certificate; Notice of Default

  	
  45

  
	
  Section 4.08

  	
  Compliance with Laws

  	
  45

  
	
  Section 4.09

  	
  Reports to Holders

  	
  46

  
	
  Section 4.10

  	
  Waiver of Stay, Extension or Usury Laws

  	
  46

  
	
  Section 4.11

  	
  Limitations on Transactions with Affiliates

  	
  47

  
	
  Section 4.12

  	
  Limitation on Incurrence of Additional Indebtedness

  	
  48

  
	
  Section 4.13

  	
  Limitation on Dividend and Other Payment Restrictions Affecting
  Subsidiaries

  	
  48

  
	
  Section 4.14

  	
  Change of Control

  	
  49

  
	
  Section 4.15

  	
  Limitation on Asset Sales

  	
  51

  
	
  Section 4.16

  	
  [Reserved]

  	
  55

  
	
  Section 4.17

  	
  Limitation on Preferred Stock of Restricted Subsidiaries

  	
  55

  
	
  Section 4.18

  	
  Limitation on Liens

  	
  55

  
	
  Section 4.19

  	
  Limitation of Guarantees by Restricted Subsidiaries

  	
  55

  
	
  Section 4.20

  	
  Conduct of Business

  	
  56

  
	
  Section 4.21

  	
  Covenant Termination

  	
  56

  
	
   

  	
   

  	
   

  
	
  ARTICLE V

  	
   

  
	
  SUCCESSOR CORPORATION

  	
   

  
	
   

  	
   

  	
   

  
	
  Section 5.01

  	
  Merger, Consolidation and Sale of Assets

  	
  56

  
	
  Section 5.02

  	
  Successor Corporation Substituted

  	
  57

  
	
   

  	
   

  	
   

  
	
  ARTICLE VI

  	
   

  
	
  DEFAULT AND REMEDIES

  	
   

  
	
   

  	
   

  	
   

  
	
  Section 6.01

  	
  Events of Default

  	
  58

  
	
  Section 6.02

  	
  Acceleration

  	
  59

  
	
  Section 6.03

  	
  Other Remedies

  	
  60

  
	
  Section 6.04

  	
  Waiver of Past Defaults

  	
  60

  
	
  Section 6.05

  	
  Control by Majority

  	
  60

  
	
  Section 6.06

  	
  Limitation on Suits

  	
  61

  
	
  Section 6.07

  	
  Rights of Holders To Receive Payment

  	
  61

  
	
  Section 6.08

  	
  Collection Suit by Trustee

  	
  61

  
	
  Section 6.09

  	
  Trustee May File Proofs of Claim

  	
  62

  
	
  Section 6.10

  	
  Priorities

  	
  62

  

 

ii

 

	
  Section 6.11

  	
  Undertaking for Costs

  	
  62

  
	
  Section 6.12

  	
  Expenses and Services After an Event of Default

  	
  63

  
	
   

  	
   

  	
   

  
	
  ARTICLE VII

  	
   

  
	
  TRUSTEE

  	
   

  
	
   

  	
   

  	
   

  
	
  Section 7.01

  	
  Duties of Trustee

  	
  63

  
	
  Section 7.02

  	
  Rights of Trustee

  	
  64

  
	
  Section 7.03

  	
  Individual Rights of Trustee

  	
  65

  
	
  Section 7.04

  	
  Trustee’s Disclaimer

  	
  66

  
	
  Section 7.05

  	
  Notice of Default

  	
  66

  
	
  Section 7.06

  	
  Reports by Trustee to Holders

  	
  66

  
	
  Section 7.07

  	
  Compensation and Indemnity

  	
  66

  
	
  Section 7.08

  	
  Replacement of Trustee

  	
  67

  
	
  Section 7.09

  	
  Successor Trustee by Merger, Etc.

  	
  68

  
	
  Section 7.10

  	
  Eligibility; Disqualification

  	
  68

  
	
  Section 7.11

  	
  Preferential Collection of Claims Against the Company

  	
  69

  
	
   

  	
   

  	
   

  
	
  ARTICLE VIII

  	
   

  
	
  DISCHARGE OF INDENTURE; DEFEASANCE

  	
   

  
	
   

  	
   

  	
   

  
	
  Section 8.01

  	
  Termination of the Company’s Obligations

  	
  69

  
	
  Section 8.02

  	
  Acknowledgment of Discharge by Trustee

  	
  71

  
	
  Section 8.03

  	
  Application of Trust Money

  	
  71

  
	
  Section 8.04

  	
  Repayment to the Company

  	
  71

  
	
  Section 8.05

  	
  Reinstatement

  	
  72

  
	
   

  	
   

  	
   

  
	
  ARTICLE IX

  	
   

  
	
  AMENDMENTS, SUPPLEMENTS AND WAIVERS

  	
   

  
	
   

  	
   

  	
   

  
	
  Section 9.01

  	
  Without Consent of Holders

  	
  72

  
	
  Section 9.02

  	
  With Consent of Holders

  	
  73

  
	
  Section 9.03

  	
  Compliance with TIA

  	
  74

  
	
  Section 9.04

  	
  Revocation and Effect of Consents

  	
  74

  
	
  Section 9.05

  	
  Notation on or Exchange of Notes

  	
  74

  
	
  Section 9.06

  	
  Trustee To Sign Amendments, Etc.

  	
  74

  
	
   

  	
   

  	
   

  
	
  ARTICLE X

  	
   

  
	
  [RESERVED]

  	
   

  
	
   

  	
   

  
	
  ARTICLE XI

  	
   

  
	
  GUARANTEE OF NOTES

  	
   

  
	
   

  	
   

  	
   

  
	
  Section 11.01

  	
  Unconditional Guarantee

  	
  75

  

 

iii

 

	
  Section 11.02

  	
  Limitations on Guarantees

  	
  76

  
	
  Section 11.03

  	
  Execution and Delivery of Guarantee

  	
  76

  
	
  Section 11.04

  	
  Release of a Guarantor

  	
  77

  
	
  Section 11.05

  	
  Waiver of Subrogation

  	
  78

  
	
  Section 11.06

  	
  Immediate Payment

  	
  78

  
	
  Section 11.07

  	
  No Set-Off

  	
  78

  
	
  Section 11.08

  	
  Obligations Absolute

  	
  78

  
	
  Section 11.09

  	
  Obligations Continuing

  	
  79

  
	
  Section 11.10

  	
  Obligations Not Reduced

  	
  79

  
	
  Section 11.11

  	
  Obligations Reinstated

  	
  79

  
	
  Section 11.12

  	
  Obligations Not Affected

  	
  79

  
	
  Section 11.13

  	
  Waiver

  	
  80

  
	
  Section 11.14

  	
  No Obligation To Take Action Against the Company

  	
  80

  
	
  Section 11.15

  	
  Dealing with the Company and Others

  	
  80

  
	
  Section 11.16

  	
  Default and Enforcement

  	
  81

  
	
  Section 11.17

  	
  Amendment, Etc.

  	
  81

  
	
  Section 11.18

  	
  Acknowledgment

  	
  81

  
	
  Section 11.19

  	
  Costs and Expenses

  	
  81

  
	
  Section 11.20

  	
  No Waiver; Cumulative Remedies

  	
  81

  
	
  Section 11.21

  	
  Guarantee in Addition to Other Obligations

  	
  81

  
	
  Section 11.22

  	
  Severability

  	
  82

  
	
  Section 11.23

  	
  Successors and Assigns

  	
  82

  
	
   

  	
   

  	
   

  
	
  ARTICLE XII

  	
   

  
	
  [RESERVED]

  	
   

  
	
   

  	
   

  
	
  ARTICLE XIII

  	
   

  
	
  MISCELLANEOUS

  	
   

  
	
   

  	
   

  	
   

  
	
  Section 13.01

  	
  TIA Controls

  	
  82

  
	
  Section 13.02

  	
  Notices

  	
  82

  
	
  Section 13.03

  	
  Communications by Holders with Other Holders

  	
  83

  
	
  Section 13.04

  	
  Certificate and Opinion as to Conditions Precedent

  	
  83

  
	
  Section 13.05

  	
  Statements Required in Certificate or Opinion

  	
  83

  
	
  Section 13.06

  	
  Rules by Trustee, Paying Agent, Registrar

  	
  84

  
	
  Section 13.07

  	
  Legal Holidays

  	
  84

  
	
  Section 13.08

  	
  Governing Law

  	
  84

  
	
  Section 13.09

  	
  No Adverse Interpretation of Other Agreements

  	
  84

  
	
  Section 13.10

  	
  No Recourse Against Others

  	
  84

  
	
  Section 13.11

  	
  Successors

  	
  84

  
	
  Section 13.12

  	
  Duplicate Originals

  	
  85

  
	
  Section 13.13

  	
  Severability

  	
  85

  
	
  Section 13.14

  	
  Independence of Covenants

  	
  85

  

 

iv

 

	
  Exhibit A

  	
  —

  	
  Form of Note

  	
   

  
	
  Exhibit B

  	
  —

  	
  Form of Legend for Global Notes

  	
   

  
	
  Exhibit C

  	
  —

  	
  Form of Transfer Certificates

  	
   

  
	
  Exhibit D

  	
  —

  	
  Form of IAI Transfer Certificate

  	
   

  
	
  Exhibit E

  	
  —

  	
  Form of Guarantee

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  Note: This Table of Contents shall not, for any purpose, be deemed to
  be part of this Indenture.

  	
   

  

 

v

 

AMENDED AND RESTATED
INDENTURE, dated as of September 10, 2009, among HUNTSMAN INTERNATIONAL
LLC, a Delaware limited liability company (the “Company”), each of the
Guarantors named herein, as guarantors, and Wilmington Trust FSB, a federal
savings bank, as trustee (the “Trustee”).

 

WHEREAS the Company, the Guarantors and the Trustee
entered into an indenture as of July 6, 2009 (as so executed, the “Existing
Indenture”) under which the Company issued $600,000,000 in aggregate principal
amount of its 51⁄2% Senior Notes due 2016 (the “Notes”) on July 6, 2009;

 

WHEREAS the Company has solicited consents from the
Holders of the Notes to amend certain provisions of the Notes and the Existing
Indenture (the “Amendments”);

 

WHEREAS all the Holders of Notes having an aggregate
principal amount of $600,000,000 consented to the Amendments;

 

WHEREAS, the Company, the Guarantors and the Trustee
agree that the Existing Indenture is hereby amended and restated in its
entirety to reflect the Amendments, so that, upon this Amended and Restated
Indenture becoming effective, the Existing Indenture shall be amended and
restated as provided herein in its entirety;

 

NOW THEREFORE, each party
agrees as follows for the benefit of the other parties and for the equal and
ratable benefit of the Holders of (a) the Notes, (b) any Additional
Notes (as defined herein), (c) if and when issued, any Exchange Notes (as
defined herein).

 

ARTICLE I

DEFINITIONS AND INCORPORATION BY REFERENCE

 

Section 1.01           Definitions.

 

“Acceleration Notice” has
the meaning provided in Section 6.02(a).

 

“Acquired Indebtedness”
means Indebtedness of a Person or any of its Subsidiaries existing at the time
such Person becomes a Restricted Subsidiary of the Company or at the time it
merges or consolidates with the Company or any of its Restricted Subsidiaries
or assumed in connection with the acquisition of assets from such Person and in
each case not incurred by such Person in connection with, or in anticipation or
contemplation of, such Person becoming a Restricted Subsidiary of the Company
or such acquisition, merger or consolidation, except for Indebtedness of a
Person or any of its Subsidiaries that is repaid at the time such Person
becomes a Restricted Subsidiary of the Company or at the time it merges or
consolidates with the Company or any of its Restricted Subsidiaries.

 

“Additional Notes” means
Notes (other than the Initial Notes and other than Exchange Notes issued
pursuant to an exchange offer for such Initial Notes under this Indenture or
issuances under Section 2.07 or 2.16) issued under this Indenture from
time to time in accordance with Sections 2.01, 2.02, 2.18 and 4.12 hereof.

 

 

“Affiliate” means, with respect
to any specified Person, any other Person who directly or indirectly through
one or more intermediaries controls, or is controlled by, or is under common
control with, such specified Person.  The
term “control” means the possession, directly or indirectly, of the power to
direct or cause the direction of the management and policies of a Person,
whether through the ownership of voting securities, by contract or otherwise;
and the terms “controlling” and “controlled” have meanings correlative of the foregoing;
provided, however, that none of the Initial Purchasers or their
Affiliates shall be deemed to be an Affiliate of the Company.

 

“Affiliate Transaction” has
the meaning provided in Section 4.11(a).

 

“Agent” means any Registrar,
Paying Agent or Co-Registrar.

 

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

 

“Applicable Procedures” has
the meaning provided in Section 2.16(a)(ii).

 

“Asset Acquisition” means (a) an
Investment by the Company or any Restricted Subsidiary of the Company in any
other Person pursuant to which such Person shall become a Restricted Subsidiary
of the Company or of any Restricted Subsidiary of the Company, or shall be
merged with or into the Company or any Restricted Subsidiary of the Company, or
(b) the acquisition by the Company or any Restricted Subsidiary of the
Company of the assets of any Person (other than a Restricted Subsidiary of the
Company) which constitute all or substantially all of the assets of such Person
or comprises any division or line of business of such Person or any other
properties or assets of such Person other than in the ordinary course of
business.

 

“Asset Sale” means any
direct or indirect sale, issuance, conveyance, transfer, lease (other than
operating leases entered into in the ordinary course of business), assignment
or other transfer for value by the Company or any of its Restricted
Subsidiaries (including any Sale and Leaseback Transaction) to any Person other
than the Company or a Restricted Subsidiary of the Company of (a) any
Capital Stock of any Restricted Subsidiary of the Company; or (b) any
other property or assets of the Company or any Restricted Subsidiary of the
Company other than in the ordinary course of business; provided, however,
that Asset Sales shall not include (i) a transaction or series of related
transactions for which the Company or its Restricted Subsidiaries receive
aggregate consideration of less than $50 million, (ii) sales, pledges,
conveyances or other transfers of accounts receivable or participations or
other interests therein and related assets (including contract rights) of the
type specified in the definition of “Qualified Securitization Transaction”
directly or indirectly to a Securitization Entity for the Fair Market Value
thereof, (iii) sales or grants of licenses to use the patents, trade
secrets, know-how and other intellectual property of the Company or any of its
Restricted Subsidiaries to the extent that such license does not prohibit the
Company or any of its Restricted Subsidiaries from using the technologies
licensed or require the Company or any of its Restricted Subsidiaries to pay
any fees for any such use, (iv) the sale, lease, conveyance, disposition
or other transfer (A) of all or substantially all of the assets of the
Company as permitted under Section 5.01, (B) of any Capital Stock or
other ownership interest in or assets or property of an Unrestricted Subsidiary
or a Person which 

 

2

 

is not a Subsidiary, (C) pursuant
to any foreclosure of assets or other remedy provided by applicable law to a
creditor of the Company or any Subsidiary of the Company with a Lien on such
assets, which Lien is permitted under this Indenture; provided that such
foreclosure or other remedy is conducted in a commercially reasonable manner or
in accordance with any bankruptcy law, (D) involving only Cash
Equivalents, Foreign Cash Equivalents or inventory in the ordinary course of
business or obsolete or worn out property or property that is no longer useful
in the conduct of the business of the Company or its Restricted Subsidiaries in
the ordinary course of business consistent with past practices of the Company
or such Restricted Subsidiaries or (E) including only the lease or
sublease of any real or personal property in the ordinary course of business, (v) the
consummation of any transaction in accordance with the terms of Sections 4.03
and 5.01 hereof and (vi) Permitted Investments.

 

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

 

“Board of Managers” means,
as to any Person, the board of managers, the board of directors or other similar
body of such Person or any duly authorized committee thereof.

 

“Board Resolution” means,
with respect to any Person, a copy of a resolution certified by the Secretary
or an Assistant Secretary of such Person to have been duly adopted by the Board
of Managers of such Person and to be in full force and effect on the date of
such certification, and delivered to the Trustee.

 

“Business Day” means a day
that is not a Saturday or Sunday or a day on which banking institutions in New
York, New York are not required to be open.

 

“Capital Stock” means (i) with
respect to any Person that is a corporation, any and all shares, interests,
participations or other equivalents (however designated and whether or not
voting) of corporate stock, including each class of Common Stock and Preferred
Stock of such Person and (ii) with respect to any Person that is not a
corporation, any and all partnership, membership or other equity interests of
such Person.

 

“Capitalized Lease” means a
lease that is required to be classified and accounted for as a capitalized
lease under GAAP.

 

“Capitalized Lease
Obligation” means, as to any Person, the obligations of such Person under a
lease that are required to be classified and accounted for as capital lease
obligations under GAAP and, for purposes of this definition, the amount of such
obligations at any date shall be the capitalized amount of such obligations at
such date, determined in accordance with GAAP.

 

“Cash Equivalents” means (i) a
marketable obligation, maturing within two years after issuance thereof, issued
or guaranteed by the United States of America or an instrumentality or agency
thereof, (ii) a certificate of deposit or banker’s acceptance, maturing
within one year after issuance thereof, issued by any lender under the Credit
Facilities, or a national or state bank or 

 

3

 

trust company or a European,
Canadian or Japanese bank, in each case having capital, surplus and undivided
profits of at least $100,000,000 and whose long-term unsecured debt has a
rating of “A” or better by S&P or A2 or better by Moody’s or the equivalent
rating by any other nationally recognized rating agency (provided that
the aggregate face amount of all Investments in certificates of deposit or
bankers’ acceptances issued by the principal offices of or branches of such
European or Japanese banks located outside the United States of America shall
not at any time exceed 33 1/3% of all Investments described in this
definition), (iii) open market commercial paper, maturing within 270 days
after issuance thereof, which has a rating of A1 or better by S&P or P1 or
better by Moody’s or the equivalent rating by any other nationally recognized
rating agency, (iv) repurchase agreements and reverse repurchase
agreements with a term not in excess of one year with any financial institution
which has been elected as a primary government securities dealer by the Federal
Reserve Board or whose securities are rated AA- or better by S&P or Aa3 or
better by Moody’s or the equivalent rating by any other nationally recognized
rating agency relating to marketable direct obligations issued or
unconditionally guaranteed by the United States of America or any agency or
instrumentality thereof and backed by the full faith and credit of the United
States of America, (v) “Money Market” preferred stock maturing within six
months after issuance thereof or municipal bonds issued by a corporation
organized under the laws of any state of the United States of America, which
has a rating of “A” or better by S&P or Moody’s or the equivalent rating by
any other nationally recognized rating agency, (vi) tax exempt floating
rate option tender bonds backed by letters of credit issued by a national or
state bank whose long-term unsecured debt has a rating of AA or better by
S&P or Aa2 or better by Moody’s or the equivalent rating by any other
nationally recognized rating agency, and (vii) shares of any money market
mutual fund rated at least AAA or the equivalent thereof by S&P or at least
Aaa or the equivalent thereof by Moody’s or any other mutual fund holding
assets consisting (except for de minimis amounts) of the type specified in
clauses (i) through (vi) above.

 

“Change of Control” means (a) any
“person” or “group” (as such terms are used in Sections 13(d) and 14(d) of
the Exchange Act), other than Mr. Jon M. Huntsman, his spouse, direct
descendants, an entity controlled by any of the foregoing and/or by a trust of
the type described hereafter, and/or a trust for the benefit of any of the
foregoing (the “Huntsman Group”) or GOP, is or becomes the “beneficial owner”
(as defined in Rules 13d-3 and 13d-5 under the Exchange Act, except that a
Person shall be deemed to have “beneficial ownership” of all securities that
such Person has the right to acquire, whether such right is exercisable immediately
or only after the passage of time), directly or indirectly, of 35% or more of
the then outstanding voting capital stock of the Company other than in a
transaction having the approval of the Board of Managers of the Company at
least a majority of which members are Continuing Managers; or (b) Continuing
Managers shall cease to constitute at least a majority of the persons
constituting the Board of Managers of the Company.

 

“Change of Control Date” has
the meaning provided in Section 4.14(c).

 

“Change of Control Offer”
has the meaning provided in Section 4.14(a).

 

“Change of Control Payment
Date” has the meaning provided in Section 4.14.

 

4

 

“Clearing Agency” has
meaning provided in Section 2.15.

 

“Clearstream” shall mean
Clearstream Banking S.A.

 

“Commission” or “SEC” means
the Securities and Exchange Commission.

 

“Commodity Agreements” means
any commodity futures contract, commodity option or other similar agreement or
arrangement entered into by the Company or any of its Restricted Subsidiaries
designed to protect the Company or any of its Restricted Subsidiaries against
fluctuations in the price of commodities actually at that time used in the
ordinary course of business of the Company or its Restricted Subsidiaries.

 

“Common
Stock” of any Person means any and all shares, interests or other
participations in, and other equivalents (however designated and whether voting
or non-voting) of such Person’s common stock, whether outstanding on the Issue
Date or issued after the Issue Date, and includes, without limitation, all
series and classes of such common stock.

 

“Company” means the party
named as such in this Indenture until a successor replaces it pursuant to this
Indenture and thereafter means such successor.

 

“Company Order” means any
written order signed in the name of the Company by two of its Officers.

 

“Consolidated EBITDA” means,
with respect to any Person, for any period, the sum (without duplication) of (i) Consolidated
Net Income and (ii) to the extent Consolidated Net Income has been reduced
thereby, (A) all income taxes of such Person and its Restricted Subsidiaries
paid or accrued in accordance with GAAP for such period (other than income
taxes attributable to extraordinary, unusual or nonrecurring gains or losses or
taxes attributable to sales or dispositions outside the ordinary course of
business) and Permitted Tax Distributions paid during such period, (B) Consolidated
Interest Expense, (C) Consolidated Non-cash Charges less any non-cash
items increasing Consolidated Net Income for such period and (D) the
amount of net loss resulting from the payment of any premiums or similar
amounts that are required to be paid under the express terms of the instrument(s) governing
any Indebtedness of the Company upon the repayment or other extinguishment of
such Indebtedness by the Company in accordance with the express terms of such
Indebtedness, all as determined on a consolidated basis for such Person and its
Restricted Subsidiaries in accordance with GAAP.

 

“Consolidated Fixed Charge
Coverage Ratio” means, with respect to any Person, the ratio of Consolidated
EBITDA of such Person during the four full fiscal quarters for which financial
statements are available as provided pursuant to Section 4.09 (the “Four
Quarter Period”) ending on or prior to the date of the transaction giving rise
to the need to calculate the Consolidated Fixed Charge Coverage Ratio (the “Transaction
Date”) to Consolidated Fixed Charges of such Person for the Four Quarter
Period.  In addition to and without
limitation of the foregoing, for purposes of this definition, “Consolidated
EBITDA” and “Consolidated Fixed Charges” shall be calculated after giving
effect on a pro forma basis for the period of such calculation to (i) the 

 

5

 

incurrence or repayment or
other reduction or discharge of any Indebtedness of such Person or any of its
Restricted Subsidiaries (and the application of the proceeds thereof) giving
rise to the need to make such calculation and any incurrence or repayment of
other Indebtedness (and the application of the proceeds thereof), other than
the incurrence or repayment of Indebtedness in the ordinary course of business
for working capital purposes pursuant to working capital facilities, occurring
during the Four Quarter Period or at any time subsequent to the last day of the
Four Quarter Period and prior to the Transaction Date, as if such incurrence or
repayment, as the case may be (and the application of the proceeds thereof),
occurred on the first day of the Four Quarter Period and (ii) any asset
sales (other than asset sales (A) in the ordinary course of  business or (B) involving a nominal
amount of gross assets of less than $25 million) or Asset Acquisitions
(including any Asset Acquisition giving rise to the need to make such
calculation) occurring during the Four Quarter Period or at any time subsequent
to the last day of the Four Quarter Period and on or prior to the Transaction
Date, as if such Asset Sale or Asset Acquisition (including the incurrence,
assumption or liability for any such Acquired Indebtedness) occurred on the
first day of the Four Quarter Period.  If
such Person or any of its Restricted Subsidiaries directly or indirectly guarantees
Indebtedness of a Person other than the Company or a Restricted Subsidiary, the
preceding sentence shall give effect to the incurrence of such guaranteed
Indebtedness as if such Person or any Restricted Subsidiary of such Person had
directly incurred or otherwise assumed such guaranteed Indebtedness.  Furthermore, in calculating “Consolidated
Fixed Charges” for purposes of determining the denominator (but not the
numerator) of this “Consolidated Fixed Charge Coverage Ratio,” (1) interest
on outstanding Indebtedness determined on a fluctuating basis as of the
Transaction Date and which will continue to be so determined thereafter shall
be deemed to have accrued at a fixed rate per annum equal to the rate of
interest on such Indebtedness in effect on the Transaction Date; (2) if
interest on any Indebtedness actually incurred on the Transaction Date may
optionally be determined at an interest rate based upon a factor of a prime or
similar rate, a eurocurrency interbank offered rate, or other rates, then the
interest rate in effect on the Transaction Date will be deemed to have been in
effect during the Four Quarter Period; and (3) notwithstanding clause (1) above,
interest on Indebtedness determined on a fluctuating basis, to the extent such
interest is covered by agreements relating to Interest Swap Obligations, shall
be deemed to accrue at the rate per annum resulting after giving effect to the
operation of such agreements.

 

“Consolidated Fixed Charges”
means, with respect to any Person for any period, the sum, without duplication,
of (i) Consolidated Interest Expense, plus (ii) the product of (x) the
amount of all dividend payments on any series of Preferred Stock of such Person
and its Restricted Subsidiaries (other than dividends paid in Qualified Capital
Stock and other than dividends paid to such Person or to a Restricted
Subsidiary of such Person) paid, accrued or scheduled to be paid or accrued
during such period times (y) a fraction, the numerator of which is one and
the denominator of which is one minus the then current effective consolidated
federal, state and local tax rate of such Person, expressed as a decimal.

 

“Consolidated Interest
Expense” means, with respect to any Person for any period, the sum of, without
duplication:  (i) the aggregate of
the interest expense of such Person and its Restricted Subsidiaries for such
period determined on a consolidated basis in accordance with 

 

6

 

GAAP, including without
limitation, (a) any amortization of debt discount and amortization or
write-off of deferred financing costs, excluding such costs relating to early
retirement of debt, (b) the net costs under Interest Swap Obligations, (c) all
capitalized interest and (d) the interest portion of any deferred payment
obligation; and (ii) the interest component of Capitalized Lease
Obligations paid, accrued and/or scheduled to be paid or accrued by such Person
and its Restricted Subsidiaries during such period as determined on a
consolidated basis in accordance with GAAP.

 

“Consolidated Leverage Ratio”
means, for any Person, the ratio of (i) Indebtedness of such Person, and
its Restricted Subsidiary to (ii) Consolidated EBITDA of such Person
calculated as set forth in the definition of Consolidated Fixed Charge Coverage
Ratio.

 

“Consolidated Net Income”
means, with respect to any Person, for any period, the sum of:  (x) the aggregate net income (or loss)
of such Person and its Restricted Subsidiaries for such period on a
consolidated basis, determined in accordance with GAAP plus (y) cash dividends
or distributions paid to such Person or a Restricted Subsidiary of such Person
by any other Person (the “Payor”) other than a Restricted Subsidiary of the
referent Person, to the extent not otherwise included in Consolidated Net
Income, which have been derived from operating cash flow of the Payor; provided
that there shall be excluded therefrom (a) after-tax gains and losses from
Asset Sales or abandonments or reserves relating thereto, (b) after-tax
items classified as extraordinary or nonrecurring gains, (c) the net
income of any Person acquired in a “pooling of interests” transaction accrued
prior to the date it becomes a Restricted Subsidiary of the Person or is merged
or consolidated with the Person or any Restricted Subsidiary of the Person, (d) the
net income (but not loss) of any Restricted Subsidiary of the Person to the
extent that the declaration of dividends or similar distributions by that
Restricted Subsidiary of that income is restricted; provided, however,
that the net income of Foreign Subsidiaries shall only be excluded in any calculation
of Consolidated Net Income of the Company as a result of application of this
clause (d) if the restriction on dividends or similar distributions
results from consensual restrictions, (e) the net income or loss of any
Person, other than a Restricted Subsidiary of the Person, except to the extent
of cash dividends or distributions paid to the Person or to a Wholly Owned
Restricted Subsidiary of the Person by such Person, (f) any restoration to
income of any contingency reserve, except to the extent that provision for such
reserve was made out of Consolidated Net Income accrued at any time following June 30,
1999, (g) income or loss attributable to discontinued operations
(including, without limitation, operations disposed of during such period
whether or not such operations were classified as discontinued), (h) in
the case of a successor to the referent Person by consolidation or merger or as
a transferee of the referent Person’s assets, any earnings of the successor
corporation prior to such consolidation, merger or transfer of assets, (i) non-cash
charges relating to asset impairments, which charges do not require an accrual
of or a Reserve for cash charges for any future period, (j) all gains or
losses from the cumulative effect of any change in accounting principles and (k) the
net amount of all Permitted Tax Distributions made during such period.

 

“Consolidated Non-cash
Charges” means, with respect to any Person, for any period, the aggregate
depreciation, amortization and other non-cash charges of such Person and its 

 

7

 

Restricted Subsidiaries
reducing Consolidated Net Income of such Person and its Restricted Subsidiaries
for such period, determined on a consolidated basis in accordance with GAAP
(excluding any such charges constituting an extraordinary item or loss or any
such charge which requires an accrual of or a reserve for cash charges for any
future period).

 

“Continuing Managers” means,
as of any date, the collective reference to (i) all members of the Board
of Managers of the Company who have held office continuously since the Issue
Date, and (ii) all members of the Board of Managers of the Company who
assumed office after such date and whose appointment or nomination for election
by the holders of the Company’s Capital Stock was approved by a vote of at
least 50% of the Continuing Managers in office immediately prior to such
appointment or nomination or by the Huntsman Group.

 

“Corporate Trust Office”
means the principal office of the Trustee at which at any time its corporate
trust business shall be administered, 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).

 

“Covenant Defeasance” has
the meaning provided in Section 8.01.

 

“Credit Facilities” means
any one or more debt facilities, indentures or other agreements governing
Indebtedness, including the senior secured Credit Agreement, dated as of August 16,
2005, as amended, among the Company and the financial institutions party
thereto, together with the related documents thereto (including, without
limitation, any guarantee agreements and security documents), in each case as
such agreements may be amended, supplemented, extended or otherwise modified
from time to time, and any one or more debt facilities, indentures or other
agreements that refinances, replaces or otherwise restructures (including
increasing the amount of available borrowings thereunder in accordance with Section 4.12
or making Restricted Subsidiaries of the Company a borrower or guarantor
thereunder) all or any portion of the Indebtedness under such agreement or any
successor or replacement agreement and whether including any additional
obligors or with the same or any other agent, lender, investor or group of
lenders or investors or with other financial institutions, investors or
lenders.

 

“Currency Agreement” means
any foreign exchange contract, currency swap agreement or other similar
agreement or arrangement designed to protect the Company or any Restricted
Subsidiary of the Company against fluctuations in currency values.

 

“Custodian” means any
receiver, trustee, assignee, liquidator, sequestrator or similar official under
any Bankruptcy Law.

 

“Default” means an event or
condition the occurrence of which is, or with the lapse of time or the giving
of notice or both would be, an Event of Default.

 

“Depositary” means DTC.

 

8

 

“Designated Date” means November 13,
2006.

 

“Discharged” means that the
Company shall be deemed to have paid and discharged the entire Indebtedness
represented by, and obligations under, the Notes and to have satisfied all the
obligations under this Indenture relating to the Notes (and the Trustee, at the
expense of the Company, shall execute proper instruments acknowledging the same
upon compliance by the Company with the provisions of Article Eight),
except (i) the rights of the Holders of Notes to receive, from the trust
fund described in Article Eight, payment of the principal of and the
interest on such Notes when such payments are due, (ii) the Company’s
obligations with respect to the Notes under Sections 2.03 through 2.07, 7.07
and 7.08 and (iii) the rights, powers, trusts, duties and immunities of
the Trustee hereunder.

 

“Disqualified Capital Stock”
means that portion of any Capital Stock which, by its terms (or by the terms of
any security into which it is convertible or for which it is exchangeable), or
upon the happening of any event, matures or is mandatorily redeemable, pursuant
to a sinking fund obligation or otherwise, or is redeemable at the sole option
of the holder thereof on or prior to the final maturity date of the Notes.

 

“Dollar” or “$” means the
lawful currency of the United States of America.

 

“Domestic Subsidiary” means
any Subsidiary other than a Foreign Subsidiary.

 

“DTC” means the Depository
Trust Company, its nominees and successors.

 

“Equity Offering” means any
sale of Qualified Capital Stock of the Company or any capital contribution to
the equity of the Company from any person other than a Subsidiary of the
Company.

 

“Euroclear” means Euroclear
Bank S.A./N.V., as operator of the Euroclear System.

 

“Event of Default” has the
meaning provided in Section 6.01.

 

“Exchange Act” means the
Securities Exchange Act of 1934, as amended, or any successor statute or statutes
thereto.

 

“Exchange Notes” means with
respect to the Initial Notes, Notes issued in exchange for the Initial Notes
pursuant to the terms of the Registration Rights Agreement or, with respect to
any Additional Notes, Notes issued in exchange for such Additional Notes
pursuant to the terms of a registration rights agreement among the Company, the
Guarantors and the initial purchasers of such Additional Notes.

 

“Fair Market Value” means,
with respect to any asset or property, the price which could be negotiated in
an arm’s-length, free market transaction, for cash, between a willing seller
and a willing and able buyer, neither of whom is under undue pressure or compulsion
to complete the transaction.  Fair market
value (i) with respect to a determination of value in excess of $100 

 

9

 

million shall be determined
by the Board of Managers of the Company acting reasonably and in good faith and
shall be evidenced by a Board Resolution delivered to the Trustee or (ii) in
all other cases, by an Officers’ Certificate delivered to the Trustee.

 

“Foreign Cash Equivalents”
means (i) debt securities with a maturity of 365 days or less issued by
any member nation of the European Union, Switzerland or any other country whose
debt securities are rated by S&P and Moody’s A-1 or P-1, or the equivalent
thereof (if a short-term debt rating is provided by either) or at least AA or
AA2, or the equivalent thereof (if a long- term unsecured debt rating is
provided by either) (each such jurisdiction, an “Approved Jurisdiction”) or any
agency or instrumentality of an Approved Jurisdiction, provided that the
full faith and credit of the Approved Jurisdiction is pledged in support of
such debt securities or such debt securities constitute a general obligation of
the Approved Jurisdiction and (ii) debt securities in an aggregate
principal amount not to exceed $25 million with a maturity of 365 days or less
issued by any nation in which the Company or its Restricted Subsidiaries has
cash which is the subject of restrictions on export or any agency or
instrumentality of such nation, provided that the full faith and credit
of such nation is pledged in support of such debt securities or such debt
securities constitute a general obligation of such nation.

 

“Foreign Subsidiary” means
any Subsidiary of the Company (other than a Guarantor) organized under the laws
of, and conducting a substantial portion of its business in, any jurisdiction
other than the United States of America or any state thereof or the District of
Columbia.

 

“Funds” means the aggregate
amount of U.S. Legal Tender and/or U.S. Government Obligations deposited with
the Trustee pursuant to Article Eight.

 

“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 may be
approved by a significant segment of the accounting profession of the United
States of America, which were in effect as of the Designated Date.

 

“Global Security” means a
Regulation S Global Security (or Unrestricted Global Security) or a Restricted
Global Security.

 

“GOP” means MatlinPatterson
Global Opportunities Partners L.P. and any other entity managed by its
investment advisor, MatlinPatterson Global Advisers LLC.

 

“Guarantee” means the
guarantee by a Guarantor of the obligations of the Company under this Indenture
and the Notes contemplated by Article Eleven of this Indenture.

 

“Guarantor”
means (i) each of the Company’s Restricted Subsidiaries that executes this
Indenture as a Guarantor and (ii) each of the Company’s Restricted
Subsidiaries that in the future executes a supplemental indenture in which such
Restricted Subsidiary agrees to be bound by the

 

10

 

terms of this Indenture as a
Guarantor; provided that any Person constituting a Guarantor as
described above shall cease to constitute a Guarantor when its respective
Guarantee is released in accordance with the terms of this Indenture.

 

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

 

“Holdings U.K.” means
Huntsman (Holdings) UK, a private unlimited company incorporated under the laws
of England and Wales.

 

“Huntsman Affiliate” means
the Company or any of its Affiliates (other than the Company and its Subsidiaries).

 

“Huntsman Corporation” means
Huntsman Corporation, a Delaware corporation.

 

“Huntsman Parent Company”
means Huntsman Corporation or any entity of which the Company is a direct or
indirect Wholly Owned Subsidiary.

 

“Huntsman Public Parent”
means any Huntsman Parent Company that has completed an Initial Public Equity
Offering including Huntsman Corporation.

 

“Indebtedness” means with
respect to any Person, without duplication, (i) all Obligations of such
Person for borrowed money, (ii) all Obligations of such Person evidenced
by bonds, debentures, notes or other similar instruments, (iii) all
Capitalized Lease Obligations of such Person, (iv) all Obligations of such
Person issued or assumed as the deferred purchase price of property that is due
more than six months after taking delivery of such property, all conditional
sale obligations and all Obligations under any title retention agreement (but
excluding trade accounts payable and other accrued liabilities arising in the
ordinary course of business that are not overdue by 90 days or more or are
being contested in good faith by appropriate proceedings promptly instituted
and diligently conducted), (v) all Obligations for the reimbursement of
any obligor on any letter of credit, banker’s acceptance or similar credit
transaction, (vi) guarantees in respect of Indebtedness referred to in
clauses (i) through (v) above and clause (viii) below, (vii) all
Obligations of any other Person of the type referred to in clauses (i) through
(vi) which are secured by any lien on any property or asset of such
Person, the amount of such Obligation being deemed to be the lesser of the Fair
Market Value of such property or asset or the amount of the Obligation so
secured, (viii) all Obligations under Currency Agreements and Interest
Swap Agreements of such Person and (ix) all Disqualified Capital Stock
issued by such Person with the amount of Indebtedness represented by such
Disqualified Capital Stock being equal to the greater of its voluntary or
involuntary liquidation preference and its maximum fixed repurchase price, but
excluding accrued dividends, if any.  For
purposes hereof, the “maximum fixed repurchase price” of any Disqualified
Capital Stock which does not have a fixed repurchase price shall be calculated
in accordance with the terms of such Disqualified Capital Stock as if such
Disqualified Capital Stock were purchased on any date on which Indebtedness
shall be required to be determined pursuant to this Indenture, and if such
price is based upon, or measured by, the Fair Market Value of such Disqualified
Capital Stock, such Fair Market Value shall be 

 

11

 

determined reasonably and in
good faith by the Board of Managers of the issuer of such Disqualified Capital
Stock; provided, however, that notwithstanding the foregoing, “Indebtedness”
shall not include (i) advances paid by customers in the ordinary course of
business for services or products to be provided or delivered in the future, (ii) deferred
taxes or (iii) unsecured indebtedness of the Company and/or its Restricted
Subsidiaries incurred to finance insurance premiums in a principal amount not
in excess of the insurance premiums to be paid by the Company and/or its Restricted
Subsidiaries for a three year period beginning on the date of any incurrence of
such indebtedness.

 

“Indenture” means this
Indenture, as amended or supplemented from time to time in accordance with the
terms hereof.

 

“Independent Financial
Advisor” means a firm which, in the judgment of the Board of Managers of the
Company, is independent and qualified to perform the task for which it is to be
engaged.

 

“Initial Notes” means the
$600,000,000 in aggregate principal amount of 5 1⁄2% Senior Notes due 2016 of the
Company that are issued on the Issue Date.

 

“Initial Public Equity
Offering” means a firm commitment underwritten offering of shares of Capital
Stock of the applicable Person registered on Form S-1 under the Securities
Act.

 

“Initial Purchasers” means
Deutsche Bank Securities Inc. and Credit Suisse Securities (USA) LLC.

 

“Institutional Accredited
Investor” means an accredited investor within the meaning of Rule 501(a)(1),
(2), (3), or (7) under the Securities Act.

 

“Interest Payment Date”
means, with respect to each Note, the stated maturity of an installment of
interest on the Notes specified therein.

 

“Interest Swap Obligations”
means the obligations of any Person pursuant to any arrangement with any other
Person, whereby, directly or indirectly, such Person is entitled to receive
from time to time periodic payments calculated by applying either a floating or
a fixed rate of interest on a stated notional amount in exchange for payments
made by such other Person calculated by applying a fixed or a floating rate of
interest on the same notional amount and shall include, without limitation,
interest rate swaps, caps, floors, collars and similar agreements.

 

“Investment” means, with
respect to any Person, any direct or indirect loan or other extension of credit
(including, without limitation, a guarantee) or capital contribution to (by
means of any transfer of cash or other property to others or any payment for
property or services for the account or use of others), or any purchase or
acquisition by such Person of any Capital Stock, bonds, notes, debentures or
other securities or evidences of Indebtedness issued by, any other Person.  “Investment” excludes extensions of trade
credit by the Company and its Restricted Subsidiaries on commercially reasonable
terms in accordance with normal trade 

 

12

 

practices of the Company or
such Restricted Subsidiary, as the case may be. 
For the purposes of Section 4.03 hereof, (i) “Investment”
shall include and be valued at the Fair Market Value of the net assets of any
Restricted Subsidiary at the time that such Restricted Subsidiary is designated
an Unrestricted Subsidiary after the Designated Date and shall exclude the Fair
Market Value of the net assets of any Unrestricted Subsidiary at the time that
such Unrestricted Subsidiary is designated a Restricted Subsidiary and (ii) the
amount of any Investment is the original cost of such Investment plus the cost
of all additional Investments by the Company or any of its Restricted Subsidiaries,
without any adjustments for increases or decreases in value, or write-ups,
write-downs or write-offs with respect to such Investment, reduced by the
payment of dividends or distributions in connection with such Investment or any
other amounts received in respect of such Investment; provided that no
such payment of dividends or distributions or receipt of any such other amounts
shall reduce the amount of any Investment if such payment of dividends or
distributions or receipt of any such amounts would be included in Consolidated
Net Income.  If the Company or any
Restricted Subsidiary of the Company sells or otherwise disposes of any Common
Stock of any direct or indirect Restricted Subsidiary of the Company such that,
after giving effect to any such sale or disposition, the Company no longer
owns, directly or indirectly, greater than 50% of the outstanding Common Stock
of such Restricted Subsidiary, the Company shall be deemed to have made an
Investment on the date of any such sale or disposition equal to the Fair Market
Value of the Common Stock of such Restricted Subsidiary not sold or disposed
of.

 

“Investment Grade Rating”
means a rating equal to or higher than Baa3 (or the equivalent) by Moody’s and
BBB- (or the equivalent) by S&P.

 

“Issue Date” means June 23,
2009.

 

“Legal Defeasance” has the
meaning provided in Section 8.01.

 

“Lien” means any lien,
mortgage, deed of trust, pledge, security interest, charge or encumbrance of
any kind (including any conditional sale or other title retention agreement,
any lease in the nature thereof and any agreement to give any security
interest), but not including any interests in accounts receivable and related
assets conveyed by the Company or any of its Subsidiaries or other entities
formed as necessary or customary under the laws of the relevant jurisdiction in
connection with any Qualified Securitization Transaction.

 

“Maturity Date” means June 30,
2016.

 

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

 

“Net Cash Proceeds” means,
with respect to any Asset Sale, the proceeds in the form of cash or Cash
Equivalents including payments in respect of deferred payment obligations when
received in the form of cash or Cash Equivalents (other than the portion of any
such deferred payment constituting interest) received by the Company or any of
its Restricted Subsidiaries from such Asset Sale net of (a) all
out-of-pocket expenses and fees relating to such Asset Sale (including, without
limitation, legal, accounting and investment banking fees and sales 

 

13

 

commissions), (b) taxes
paid or payable after taking into account any reduction in consolidated tax
liability due to available tax credits or deductions and any tax sharing
arrangements, (c) repayment of Indebtedness that is required to be repaid
in connection with such Asset Sale (d) the decrease in proceeds from
Qualified Securitization Transactions which results from such Asset Sale and (e) appropriate
amounts to be provided by the Company or any Restricted Subsidiary, as the case
may be, as a reserve, in accordance with GAAP, against any liabilities
associated with such Asset Sale and retained by the Company or any Restricted
Subsidiary, as the case may be, after such Asset Sale, including, without
limitation, pension and other post-employment benefit liabilities, liabilities
related to environmental matters and liabilities under any indemnification obligations
associated with such Asset Sale.

 

“Net Proceeds Offer” has the
meaning provided in Section 4.15(c).

 

“Net Proceeds Offer Amount”
has the meaning provided in Section 4.15(c).

 

“Net Proceeds Offer Payment
Date” has the meaning provided in Section 4.15(c).

 

“Net Proceeds Offer Trigger
Date” has the meaning provided in Section 4.15(c).

 

“Noon Buying Rate” has the
meaning provided in Section 2.02.

 

“Non-U.S.
Person” means a person who is not a U.S. Person within the meaning assigned to
such term in Regulation S.

 

“Notes” means, the Initial
Notes, any Additional Notes and the Exchange Notes.

 

“Obligations”
means all obligations for principal, premium, interest, penalties, fees,
indemnifications, reimbursements, damages and other liabilities payable under
the documentation governing any Indebtedness.

 

“Officer” means, with
respect to any Person, the Chairman of the Board, the Chief Executive Officer,
the President, any Vice President, the Chief Financial Officer, the Treasurer,
the Assistant Treasurer, the Financial Director, or the Secretary or the
Assistant Secretary of such Person (or, with respect to a Person that is a
limited partnership, the General Partner of such Person), or any other officer
designated by the Board of Managers serving in a similar capacity.

 

“Officers’ Certificate”
means, with respect to any Person, a certificate signed by two Officers or by
an Officer and either an Assistant Treasurer or an Assistant Secretary of such
Person and otherwise complying with the requirements of Sections 13.04 and
13.05, as they relate to the making of an Officers’ Certificate, and delivered
to the Trustee.

 

“Opinion of Counsel” means a
written opinion from legal counsel who is reasonably acceptable to the Trustee
complying with the requirements of Sections 13.04 and 13.05, as they relate to
the giving of an Opinion of Counsel, and delivered to the Trustee.  Counsel giving any Opinion of Counsel shall
be entitled to rely on an Officers’ Certificate as to any factual matters 

 

14

 

relevant to such opinion.

 

“Participants”
means institutions that have accounts with DTC or its nominee.

 

“Paying Agent” means any
Person (other than the Company and any of its Affiliates) authorized by the
Company to pay the principal of (and premium, if any) or interest on any notes
on behalf of the Company and perform all the other obligations and duties of a “Paying
Agent” described herein.

 

“Permitted
Indebtedness” means, without duplication, each of the following:

 

(i)            Indebtedness represented by the Initial Notes, the
Exchange Notes with respect to the Initial Notes and the related Guarantees;

 

(ii)           Indebtedness incurred under the Credit Facilities
pursuant to this clause (ii) in an aggregate principal amount not
exceeding the greater of $3.3 billion or 30% of Total Assets of the Company at
any one time outstanding;

 

(iii)          other Indebtedness of the Company and its Restricted
Subsidiaries outstanding on the Issue Date reduced by the amount of any
prepayments with Net Cash Proceeds of any Asset Sale (which are accompanied by
a corresponding permanent commitment reduction) pursuant to clause (c) of Section 4.15;

 

(iv)          Interest Swap Obligations of the Company relating to
Indebtedness of the Company or any of its Restricted Subsidiaries (or
Indebtedness that the Company or any of its Restricted Subsidiaries reasonably
intends to incur within six months) and Interest Swap Obligations of any
Restricted Subsidiary of the Company relating to Indebtedness of such
Restricted Subsidiary (or Indebtedness that such Restricted Subsidiary
reasonably intends to incur within six months); provided, however,
that such Interest Swap Obligations will constitute “Permitted Indebtedness”
only if they are entered into to protect the Company and its Restricted
Subsidiaries from fluctuations in interest rates on Indebtedness permitted
under this Indenture to the extent the notional principal amount of such
Interest Swap Obligations, when incurred, does not exceed the principal amount
of the Indebtedness to which such Interest Swap Obligations relate;

 

(v)           Indebtedness under Commodity Agreements and Currency
Agreements; provided that in the case of Currency Agreements which
relate to Indebtedness, such Currency Agreements do not increase the
Indebtedness of the Company and its Restricted Subsidiaries outstanding other
than as a result of fluctuations in foreign currency exchange rates or by
reason of fees, indemnities and compensation payable thereunder;

 

(vi)          Indebtedness of a Restricted Subsidiary of the
Company to the Company or to a Restricted Subsidiary of the Company for so long
as such Indebtedness is held by the Company or a Restricted Subsidiary of the
Company, in each case subject 

 

15

 

to no Lien held by a Person other than the Company or a Restricted
Subsidiary of the Company (other than the pledge of intercompany notes under
the Credit Facilities); provided that if as of any date any Person other
than the Company or a Restricted Subsidiary of the Company owns or holds any
such Indebtedness or holds a Lien in respect of such Indebtedness (other than
the pledge of intercompany notes under the Credit Facilities), such date shall
be deemed the incurrence of Indebtedness not constituting Permitted Indebtedness
by the issuer of such Indebtedness;

 

(vii)         Indebtedness of the Company to a Restricted Subsidiary
for so long as such Indebtedness is held by a Restricted Subsidiary, in each
case subject to no Lien (other than Liens securing intercompany notes pledged
under the Credit Facilities); provided that (a) any Indebtedness of
the Company to any Restricted Subsidiary (other than pursuant to notes pledged
under the Credit Facilities) is unsecured and subordinated, pursuant to a
written agreement, to the Company’s obligations under this Indenture and the
Notes and (b) if as of any date any Person other than a Restricted
Subsidiary owns or holds any such Indebtedness or any Person holds a Lien in
respect of such Indebtedness (other than pledges securing the Credit
Facilities), such date shall be deemed the incurrence of Indebtedness not
constituting Permitted Indebtedness by the Company;

 

(viii)        Indebtedness arising from the honoring by a bank or
other financial institution of a check, draft or similar instrument
inadvertently (except in the case of daylight overdrafts) drawn against
insufficient funds in the ordinary course of business; provided, however,
that such Indebtedness is extinguished within two business days of incurrence;

 

(ix)           Indebtedness of the Company or any of its Restricted
Subsidiaries represented by letters of credit for the account of the Company or
such Restricted Subsidiary, as the case may be, in order to provide security
for workers’ compensation claims, payment obligations in connection with
self-insurance or similar requirements in the ordinary course of business;

 

(x)            Refinancing Indebtedness;

 

(xi)           Indebtedness arising from agreements of the Company
or a Subsidiary providing for indemnification, adjustment of purchase price or
similar obligations, in each case, incurred in connection with the disposition
of any business, assets or Subsidiary, other than guarantees of Indebtedness
incurred by any Person acquiring all or any portion of such business, assets or
Subsidiary for the purpose of financing such acquisition; provided that
the maximum aggregate liability in respect of all such Indebtedness shall at no
time exceed the gross proceeds actually received by the Company and the
Subsidiary in connection with such disposition;

 

(xii)          Obligations in respect of performance bonds and
completion, guarantee, surety and similar bonds provided by the Company or any
Subsidiary in the ordinary course of business;

 

16

 

(xiii)                               guarantees by
the Company or a Restricted Subsidiary of Indebtedness incurred by the Company
or a Restricted Subsidiary so long as the incurrence of such Indebtedness by
the Company or any such Restricted Subsidiary is otherwise permitted by the terms
of this Indenture;

 

(xiv)                              Indebtedness of
the Company or any Subsidiary (A) representing Capitalized Lease
Obligations not to exceed $150 million outstanding at any time or (B) constituting
purchase money Indebtedness incurred to finance property or assets of the
Company or any Restricted Subsidiary of the Company acquired in the ordinary
course of business; provided, however, that such purchase money
Indebtedness shall not exceed the cost of such property or assets and shall not
be secured by any property or assets of the Company or any Restricted
Subsidiary of the Company other than the property and assets so acquired;

 

(xv)                                 Indebtedness of
Foreign Subsidiaries that are Restricted Subsidiaries to the extent that the
aggregate outstanding amount of Indebtedness incurred by such Foreign
Subsidiaries under this clause (xv) does not exceed at any one time an amount
equal to the sum of (A) 80% of the consolidated book value of the accounts
receivable of all Foreign Subsidiaries and (B) 60% of the consolidated
book value of the inventory of all Foreign Subsidiaries; provided, however,
that notwithstanding the foregoing limitation, Foreign Subsidiaries may incur
in the aggregate up to $150 million of Indebtedness outstanding at any one
time;

 

(xvi)                              Indebtedness of
the Company and its Domestic Subsidiaries pursuant to over draft lines or
similar extensions of credit in an aggregate amount not to exceed $30 million
at any one time outstanding and Indebtedness of Foreign Subsidiaries pursuant
to over draft lines or similar extensions of credit in an aggregate principal
amount not to exceed $60 million at any one time outstanding;

 

(xvii)                           the incurrence
by a Securitization Entity of Indebtedness in a Qualified Securitization
Transaction that is not recourse to the Company or any Subsidiary of the
Company (except for Standard Securitization Undertakings);

 

(xviii)                        Indebtedness of
the Company to a Huntsman Affiliate constituting Subordinated Indebtedness;

 

(xix)                                Indebtedness
consisting of take-or-pay obligations contained in supply agreements entered
into in the ordinary course of business;

 

(xx)                                   Indebtedness of
the Company to any of its Subsidiaries or other entities formed as necessary or
customary under the laws of the relevant jurisdiction incurred in connection
with the sale, pledge or other conveyance of accounts receivable or
participations or any interests therein and related assets directly or
indirectly to the Company by any such Subsidiary which assets or interests are
subsequently conveyed, pledged or otherwise transferred, directly or
indirectly, by the Company to a 

 

17

 

Securitization Entity in a Qualified Securitization Transaction;

 

(xxi)                                additional
Indebtedness of the Company and its Restricted Subsidiaries in an aggregate
principal amount not to exceed the greater of $200 million or 2% of Total
Assets of the Company at any one time outstanding; and

 

(xxii)                             (A) guarantees
(“Upstream Guarantees”) issued by the Company or any guarantor of Indebtedness
of a Huntsman Public Parent (“Parent Debt”), provided that:

 

1.               such Upstream
Guarantee may guarantee only Parent Debt that was incurred, and the proceeds of
which are used, to Refinance Indebtedness of the Company;

 

2.               the aggregate
amount of Parent Debt that is guaranteed by the Upstream Guarantee shall not
exceed the sum of (x) the aggregate amount of Indebtedness of the Company
that is Refinanced with the proceeds of such Parent Debt (“HI Refinanced Debt”),
and (y) the amount of any premiums required to be paid under the terms of
the instrument governing such HI Refinanced Debt and the amount of reasonable
expenses incurred by the Company, in each case in connection with the
Refinancing of such HI Refinanced Debt;

 

3.               the HI
Refinanced Debt is not incurred in connection with or in anticipation or
contemplation of the Refinancing of such HI Refinanced Debt; and

 

4.               both
immediately before and after the issuance of any Upstream Guarantee there shall
be existing no Default or Event of Default.

 

For purposes of the
foregoing provisions, any Upstream Guarantee given with respect to Parent Debt
under a revolving or undrawn credit facility shall be deemed entered into only
when such Upstream Guarantee is initially entered into with respect to the full
commitment of revolving or undrawn credit facility,

 

or

 

(B)                                guarantees by
the Company or any guarantor, as the case may be (“Replacement Guarantees”),
that replace any Upstream Guarantee (a “Previous Guarantee”) that (a) was
previously issued by such person pursuant to paragraph (A) of this clause
(xxii) or (b) was a Replacement Guarantee previously issued by such person
pursuant to this paragraph (B),

 

provided that:

 

1.               the Replacement
Guarantee may guarantee only Parent Debt (“Replacement Debt”) that was
incurred, and the proceeds of which are used, to 

 

18

 

Refinance
the Parent Debt that was guaranteed by the Previous Guarantee being so replaced
(“Previous Debt”);

 

2.               the aggregate
amount of Replacement Debt that is guaranteed by the Replacement Guarantee
shall not exceed the sum of (x) the aggregate amount of Previous Debt
guaranteed by the Previous Guarantee being so replaced, (y) the amount of
any premiums required to be paid under the terms of the instrument governing such
Previous Debt with respect to the amount of Previous Debt guaranteed by the
Previous Guarantee being so replaced, and (z) and the pro rata portion of
the amount of reasonable expenses incurred by the Huntsman Public Parent, in
each case in connection with the Refinancing of such Previous Debt; and

 

3.               both
immediately before and after the issuance of any Replacement Guarantee there
shall be existing no Default or Event of Default.

 

For purposes of determining
compliance with Section 4.12, in the event that an item of Indebtedness
meets the criteria of more than one of the categories of Permitted Indebtedness
described in clauses (i) through (xxii) above or is entitled to be
incurred pursuant to the Consolidated Fixed Charge Coverage Ratio provisions of
Section 4.12, the Company shall, in its sole discretion, classify (or
later reclassify) such item of Indebtedness in any manner that complies with Section 4.12;
provided that
$1.4 billion of Indebtedness outstanding under the Credit Facilities on
the Issue Date (and any refinancings thereof) shall be deemed to have been
incurred pursuant to clause (ii) above. Accrual of interest,
accretion or amortization of original issue discount, the payment of interest
on any Indebtedness in the form of additional Indebtedness with the same terms,
and the payment of dividends on Disqualified Capital Stock in the form of
additional shares of the same class of Disqualified Capital Stock will not be
deemed to be an incurrence of Indebtedness or an issuance of Disqualified Capital
Stock for purposes of Section 4.12.

 

“Permitted Investments”
means (i) Investments by the Company or any Restricted Subsidiary of the
Company in any Person that is or will become immediately after such Investment
a Restricted Subsidiary of the Company or that will merge or consolidate into
the Company or a Restricted Subsidiary of the Company; (ii) Investments in
the Company by any Restricted Subsidiary of the Company; provided that
any Indebtedness evidencing such Investment is unsecured and subordinated
(other than pursuant to intercompany notes pledged under the Credit Facilities),
pursuant to a written agreement, to the Company’s obligations under the Notes
and this Indenture; (iii) investments in cash and Cash Equivalents; (iv) loans
and advances to employees and officers of the Company and its Restricted
Subsidiaries in the ordinary course of business for travel, relocation and
related expenses; (v) Investments in Unrestricted Subsidiaries or joint
ventures not to exceed the greater of $300 million or 3% of Total Assets of the
Company, plus (A) the aggregate net after-tax amount returned in cash on
or with respect to any Investments made in Unrestricted Subsidiaries and joint
ventures whether through interest payments, principal payments, dividends or
other distributions or payments, (B) the net after-tax cash proceeds
received by the Company or any Restricted Subsidiary from the 

 

19

 

disposition of all or any
portion of such Investments (other than to a Restricted Subsidiary of the
Company), (C) upon redesignation of an Unrestricted Subsidiary as a Restricted
Subsidiary, the Fair Market Value of such Subsidiary and (D) the net cash
proceeds received by the Company from the issuance of Specified Venture Capital
Stock; (vi) Investments in securities received pursuant to any plan of
reorganization or similar arrangement upon the bankruptcy or insolvency of any
debtors of the Company or its Restricted Subsidiaries; (vii) Investments
made by the Company or its Restricted Subsidiaries as a result of consideration
received in connection with an Asset Sale made in compliance with Section 4.15;
(viii) Investments existing on the Designated Date; (ix) any
Investment by the Company or a Wholly Owned Subsidiary of the Company or by
Tioxide Group or Holdings U.K., in a Securitization Entity or any Investment by
a Securitization Entity in any other Person in connection with a Qualified
Securitization Transaction; provided that any Investment in a
Securitization Entity is in the form of a Purchase Money Note or an equity
interest; (x) Investments by the Company in Rubicon, Inc. and
Louisiana Pigment Company (each a “Joint Venture”), so long as: (A) such
Joint Venture does not have any Indebtedness for borrowed money at any time on
or after the date of such Investment (other than Indebtedness owing to the
equity holders of such Joint Ventures), (B) the documentation governing
such Joint Venture does not contain a restriction on distributions to the
Company, and (C) such Joint Venture is engaged only in the business of
manufacturing product used or marketed by the Company and its Restricted
Subsidiaries and/or the joint venture partner, and business reasonably related
thereto; (xi) Investments by Foreign Subsidiaries in Foreign Cash Equivalents;
(xii) loans to any Huntsman Parent Company for the purposes described in clause
(7) of the second paragraph of Section 4.03 which, when aggregated
with the payment made under such clause, will not exceed $10 million in any
fiscal year; (xiii) any Indebtedness of the Company to any of its Subsidiaries
or other entities formed as necessary or customary under the laws of the
relevant jurisdiction incurred in connection with the conveyance, pledge or
other transfer of accounts receivable or participations or interests therein
and related assets directly or indirectly to the Company by any such Subsidiary
which assets are subsequently conveyed, pledged or otherwise transferred,
directly or indirectly, by the Company to a Securitization Entity in a
Qualified Securitization Transaction; (xiv) Investments by the Company or
any of its Restricted Subsidiaries in a Permitted Joint Venture, so long
as:  (A) such Permitted Joint
Venture does not have any Indebtedness for borrowed money which would be
required to be reflected on a balance sheet as debt under GAAP at any time on
or after the date of such Investment (other than Indebtedness owing to the
equity holders of such Permitted Joint Venture, the Company or any Restricted
Subsidiary); (B) the documentation governing such Permitted Joint Venture
does not contain a restriction on distributions to the Company or its
Restricted Subsidiaries; and (C) after giving pro  forma effect
to such Investment, the Company would be permitted to incur $1.00 of additional
Indebtedness other than Permitted Indebtedness under Section 4.12; (xv)
additional Investments in an aggregate amount not exceeding $150 million at any
one time outstanding; and (xvi) the incurrence of Guarantees permitted by
clause (xxii) of the definition of Permitted Indebtedness.

 

“Permitted Joint Venture” means, with respect to any Person:

 

1.                                       any
corporation, association, or other business entity (other than a 

 

20

 

partnership)
of which 50% or more of the total voting power of shares of Capital Stock
entitled (without regard to the occurrence of any contingency) to vote in the
election of directors, managers or trustees thereof is at the time of
determination owned or controlled, directly or indirectly, by such Person or
one or more of the Restricted Subsidiaries of that Person or a combination
thereof; and

 

2.                                       any
partnership, joint venture, limited liability company or similar entity of
which

 

(a)                                  50% or more of
the capital accounts, distribution rights, total equity and voting interests or
general or limited partnership interests, as applicable, are owned or
controlled, directly or indirectly, by such Person or one or more of the other
Restricted Subsidiaries of that Person or a combination thereof whether in the
form of membership, general, special or limited partnership interests or
otherwise; and

 

(b)                                 either such
Person or any Restricted Subsidiary of such Person is a controlling general
partner or no other Person controls such entity.

 

“Permitted Tax Distribution”
for any fiscal year means any payments in compliance with clause (6) of
the second paragraph under Section 4.03.

 

“Person” means an
individual, partnership, corporation, unincorporated organization, trust or
joint venture, or a governmental agency or political subdivision thereof.

 

“Physical Notes” shall have
the meaning provided in Section 2.01(c).

 

“Preferred Stock” of any
Person means any Capital Stock of such Person that has preferential rights to
any other Capital Stock of such Person with respect to dividends or redemptions
or upon liquidation.

 

“principal” of any
Indebtedness (including the Notes) means the principal amount of such Indebtedness
plus the premium, if any, on such Indebtedness.

 

“Private Placement Legend”
means the legend initially set forth on the Notes in the form set forth for
Restricted Securities on Exhibit A.

 

“pro forma” means, unless
otherwise provided herein, with respect to any calculation made or required to
be made pursuant to the terms of this Indenture, a calculation in accordance
with Article 11 of Regulation S-X promulgated under the Securities Act.

 

“Purchase
Money Note” means a promissory note evidencing a line of credit, or evidencing
other Indebtedness owed to the Company or any Restricted Subsidiary in
connection with a Qualified Securitization Transaction, which note shall be
repaid from cash available to the maker of such note, other than amounts
required to be established as reserves, amounts paid to investors in respect of
interest, principal and other amounts owing to such investors and amounts

 

21

 

paid in connection with the
purchase of newly generated accounts receivable.

 

“Qualified Capital Stock”
means any Capital Stock that is not Disqualified Capital Stock.

 

“Qualified Institutional
Buyer” or “QIB” has the meaning specified in Rule 144A.

 

“Qualified Securitization
Transaction” means any transaction or series of transactions that may be
entered into by the Company or any of its Subsidiaries pursuant to which the
Company or any of its Subsidiaries may sell, convey or otherwise transfer
pursuant to terms necessary or customary in the relevant jurisdiction, directly
or indirectly, to (a) a Securitization Entity or to the Company which
subsequently transfers to a Securitization Entity (in the case of a transfer by
the Company or any of its Subsidiaries) and (b) any other Person (in the
case of transfer by a Securitization Entity), or may grant a security interest
in any accounts receivable or any participations or other interests therein
(whether now existing or arising or acquired in the future) of the Company or
any of its Subsidiaries or other entities formed as necessary or customary under
the laws of the relevant jurisdiction, and any assets related thereto
including, without limitation, all collateral securing such accounts
receivable, all contracts and contract rights and all guarantees or other
obligations in respect of such accounts receivable, proceeds of such accounts
receivable and other assets (including contract rights) which are necessarily
or customarily transferred in the relevant jurisdiction or in respect of which
security interests are necessarily or customarily granted in the relevant
jurisdiction in connection with asset securitization transactions involving
accounts receivable.  Following the
Initial Public Equity Offering of a Huntsman Public Parent, references in the
foregoing definition to the “Company” shall be deemed also to refer to such
Huntsman Public Parent.

 

“Rating Agencies” means
Moody’s and S&P.

 

“Record Date” means with
respect to each Note, each applicable record date specified therein.

 

“Redemption Date” means,
with respect to any Note, the Maturity Date of such Note or the earlier date on
which such Note is to be redeemed by the Company pursuant to paragraph 5 of the
Notes.

 

“Redemption Price” has the
meaning provided in Section 3.03.

 

“Reference Date” has the
meaning provided in Section 4.03.

 

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

 

“Refinancing Indebtedness”
means any Refinancing by the Company or any Restricted Subsidiary of the
Company of Indebtedness incurred in accordance with the Fixed Charge 

 

22

 

Coverage Ratio test set forth
in Section 4.12 or Indebtedness described in clauses (i), (iii), (x),
(xiv)(B) or (xv) of the definition of “Permitted Indebtedness,” in each
case that does not (1) result in an increase in the aggregate principal
amount of Indebtedness of such Person as of the date of such proposed
Refinancing (plus the amount of any premium required to be paid under the terms
of the instrument governing such Indebtedness and plus the amount of reasonable
expenses incurred by the Company in connection with such Refinancing) or (2) create
Indebtedness with (A) a Weighted Average Life to Maturity that is less
than the Weighted Average Life to Maturity of the Indebtedness being Refinanced
or (B) a final maturity earlier than the final maturity of the
Indebtedness being Refinanced; provided that (x) if such
Indebtedness being Refinanced is Indebtedness solely of the Company, then such
Refinancing Indebtedness shall be Indebtedness solely of the Company and (y) if
such Indebtedness being Refinanced is subordinate or junior to the Notes, then
such Refinancing Indebtedness shall be subordinate to the Notes at least to the
same extent and in the same manner as the Indebtedness being Refinanced.

 

“Registrar” has the meaning
provided in Section 2.03.

 

“Registration Rights
Agreement” means the Exchange and Registration Rights Agreement dated June 23,
2009 among the Company, the Guarantors and the Initial Purchasers.

 

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

 

“Regulation S Global
Security” has the meaning provided in Section 2.01(b)(i).

 

“Replacement Assets” has the
meaning provided in Section 4.15(c).

 

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

 

“Restricted Global Security”
has the meaning provided in Section 2.01(a)(i).

 

“Restricted Payment” means
to

 

1.                                       declare or pay
any dividend or make any distribution, other than dividends or distributions
payable in Qualified Capital Stock of the Company, on or in respect of shares
of the Company’s Capital Stock to holders of such Capital Stock,

 

2.                                       purchase,
redeem or otherwise acquire or retire for value any Capital Stock of the Company
or any warrants, rights or options to purchase or acquire shares of any class
of such Capital Stock,

 

23

 

3.                                       make any
principal payment on, purchase, defease, redeem, prepay, decrease or otherwise
acquire or retire for value, prior to any scheduled final maturity, scheduled
repayment or scheduled sinking fund payment, any Indebtedness of the Company or
any Guarantor that is subordinate or junior in right of payment to the Notes or
such Guarantor’s Guarantee, as the case may be, or

 

4.                                       make any
Investment other than Permitted Investments.

 

“Restricted Security” means
a Note that constitutes a “restricted security” within the meaning of Rule 144(a)(3) under
the Securities Act; provided, however, that the Trustee shall be
entitled to request and conclusively rely on an Opinion of Counsel with respect
to whether any Note constitutes a Restricted Security.

 

“Restricted Subsidiary” of
any Person means any Subsidiary of such Person which at the time of
determination is not an Unrestricted Subsidiary.

 

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

 

“Sale and Leaseback
Transaction” means any direct or indirect arrangement with any Person or to
which any such Person is a party, providing for the leasing to the Company or a
Restricted Subsidiary of any property, whether owned by the Company or any
Restricted Subsidiary on the Issue Date or later acquired, which has been or is
to be sold or transferred by the Company or such Restricted Subsidiary to such
Person or to any other Person from whom funds have been or are to be advanced
by such Person on the security of such property.

 

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

 

“Securitization Entity”
means a Wholly Owned Subsidiary of the Company (or Tioxide Group or Holdings
U.K. or another Person in which the Company or any Subsidiary of the Company
makes an Investment and to which the Company or any Subsidiary of the Company
transfers, directly or indirectly, accounts receivable or participations or
interests therein or related assets) which engages in no activities other than
in connection with the financing of accounts receivable and which is designated
by the Board of Managers of the Company (as provided below) as a Securitization
Entity (a) no portion of the Indebtedness or any other Obligations
(contingent or otherwise) of which (i) is guaranteed by the Company or any
Subsidiary of the Company (other than the Securitization Entity)(excluding
guarantees of Obligations (other than the principal of, and interest on,
Indebtedness)) pursuant to Standard Securitization Undertakings, (ii) is
recourse to or obligates the Company or any Subsidiary of the Company (other
than the Securitization Entity) in any way other than pursuant to Standard Securitization
Undertakings or (iii) subjects any property or asset of the Company or any
Subsidiary of the Company (other than the Securitization Entity), directly or
indirectly, contingently or otherwise, to the satisfaction thereof, other than
pursuant to Standard Securitization Undertakings and other than any interest in
the accounts receivable and related 

 

24

 

assets being financed
(whether in the form of any equity interest in such assets or subordinated indebtedness
payable primarily from such financed assets) retained or acquired by the
Company or any Subsidiary of the Company, (b) with which neither the
Company nor any Subsidiary of the Company has any material contract, agreement,
arrangement or understanding other than on terms no less favorable to the
Company or such Subsidiary than those that might be obtained at the time from
Persons that are not Affiliates of the Company, other than fees payable in the
ordinary course of business in connection with servicing receivables of such
entity, and (c) to which neither the Company nor any Subsidiary of the
Company has any obligation to maintain or preserve such entity’s financial
condition or cause such entity to achieve certain levels of operating
results.  Any such designation by the
Board of Managers of the Company shall be evidenced to the Trustee by filing
with the Trustee a certified copy of the Board Resolution of the Board of
Managers of the Company giving effect to such designation and an officers’ certificate
certifying that such designation complied with the foregoing conditions; provided
that Huntsman Receivables Finance LLC shall be deemed to be a Securitization
Entity as of the Issue Date.  Following
the Initial Public Equity Offering of a Huntsman Public Parent, references in
the foregoing definition to the “Company” shall be deemed also to refer to such
Huntsman Public Parent.

 

“Senior Debt” means
Indebtedness of the Company or any Guarantor that is not Subordinated
Indebtedness.

 

“Significant Subsidiary”
means any Restricted Subsidiary of the Company which, at the date of
determination, is a “Significant Subsidiary” as such term is defined in
Regulation S-X under the Exchange Act.

 

“Specified Venture Capital
Stock” means Qualified Capital Stock of the Company issued to a Person who is
not an Affiliate of the Company and the proceeds from the issuance of which are
applied within 180 days after the issuance thereof to an Investment in an
Unrestricted Subsidiary or joint venture.

 

“Standard Securitization
Undertakings” means obligations, representations, warranties, covenants and
indemnities entered into by the Company or any Securitization Entity or any
Subsidiary of the Company which are customary or necessary in the relevant
jurisdiction in an accounts receivable securitization transaction.  Following the Initial Public Equity Offering
of a Huntsman Public Parent, references in the foregoing definition to the “Company”
shall be deemed also to refer to such Huntsman Public Parent.

 

“Subordinated Indebtedness”
means Indebtedness of the Company or any Guarantor which is expressly
subordinated in right of payment to the Notes or the Guarantee of such
Guarantor, as the case may be.

 

“Subsidiary,” with respect
to any Person, means (i) any corporation of which the outstanding Capital
Stock having at least a majority of the votes entitled to be cast in the
election of managers or directors, as applicable, under ordinary circumstances
shall at the time be owned, directly or indirectly, by such Person or (ii) any
other Person of which at least a majority of the 

 

25

 

voting interest under
ordinary circumstances is at the time, directly or indirectly, owned by such
Person.

 

“Surviving Entity” has the
meaning provided in Section 5.01(a)(i).

 

“Tax Sharing Agreement”
means the Tax Sharing Agreement dated as of August 16, 2005 between the
Company and Huntsman Corporation as in existence on the Issue Date or any
amendment thereto or replacement thereof so long as any such amendment or
replacement provisions are not more disadvantageous to the Holders of Notes in
any material respect than the provisions of the agreement being amended or
replaced.

 

“TIA” means the Trust
Indenture Act of 1939 (15 U.S.C. §§ 77aaa-77bbbb), as amended, as in
effect on the date hereof, except as otherwise provided in Section 9.03.

 

“Total Assets of Huntsman International” means, as of any
determination dates, the total assets of the Company and its consolidated
subsidiaries, as determined in accordance with GAAP at the end of the most
recent fiscal quarter for which financial statements are available under Section 4.09.

 

“Trust Officer” means any
officer or assistant officer of the Trustee assigned by the Trustee to
administer its corporate trust matters or, in the case of a successor trustee,
an officer assigned to the department, division or group performing the
corporate trust work of such successor.

 

“Trustee” means the party
named as such in this Indenture until a successor replaces it in accordance
with the provisions of this Indenture and thereafter means such successor.

 

“Unrestricted
Global Security” means one or more securities in definitive, fully registered
form without interest coupons, with the legend provided in Exhibit B
hereto, without the Private Placements Legend.

 

“Unrestricted Notes” means
Notes that are not Restricted Securities including, without limitation, the
Exchange Notes issued pursuant to a registered exchange offer in accordance
with the Registration Rights Agreement.

 

“Unrestricted Subsidiary” of
any Person means (i) any Subsidiary of such Person that at the time of
determination shall be or continue to be designated an Unrestricted Subsidiary,
and (ii) any Subsidiary of an Unrestricted Subsidiary.  Huntsman China Investments B.V., Huntsman
Distribution Corporation, Huntsman SA Investment Corporation, Huntsman
Styrenics Investments Holdings LLC and Huntsman Verwaltungs GmbH and their
respective Subsidiaries shall each be Unrestricted Subsidiaries as of the date
of this Indenture without further action by the Company or compliance with
requirements in this Indenture applicable to such designation.  The Board of Managers of the Company may,
after the Issue Date, designate any Subsidiary (including any newly acquired or
newly formed Subsidiary) to be an Unrestricted Subsidiary if such Subsidiary
does not own any Capital Stock of, or does not own or hold any Lien on any 

 

26

 

property of, the Company or
any other Subsidiary of the Company that is not a Subsidiary of the Subsidiary
to be so designated; the Company certifies to the Trustee that such designation
complies with Section 4.03 and each Subsidiary to be  designated as an Unrestricted Subsidiary and
each of its Subsidiaries has not at the time of designation, and does not
thereafter, create, incur, issue, assume, guarantee or otherwise become
directly or indirectly liable with respect to any Indebtedness under which the
lender has recourse to any of the assets of the Company or any of its
Restricted Subsidiaries.  The Board of
Managers of the Company may designate any Unrestricted Subsidiary to be a
Restricted Subsidiary only if (x) immediately after giving effect to such
designation, the Company is able to incur at least $1.00 of additional
Indebtedness (other than Permitted Indebtedness) in compliance with Section 4.12
and (y) immediately before and immediately after giving effect to such
designation, no default or Event of Default shall have occurred and be
continuing.  Any such designation by the
Board of Managers of the Company shall be evidenced to the Trustee by promptly
filing with the Trustee a copy of the Board Resolution approving the
designation and an officers’ certificate certifying that the designation
complied with this Indenture.

 

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

 

“U.S. Legal Tender” means
such coin or currency of the United States of America as at the time of payment
shall be legal tender for the payment of public and private debts.

 

“Weighted Average Life to
Maturity” means, when applied to any Indebtedness at any date, the number of
years obtained by dividing (a) the then outstanding aggregate principal
amount of such Indebtedness into (b) the sum of the total of the products
obtained by multiplying (i) the amount of each then remaining installment,
sinking fund, serial maturity or other required payment of principal, including
payment at final maturity, in respect thereof, by (ii) the number of years
(calculated to the nearest one-twelfth) which will elapse between such date and
the making of such payment.

 

“Wholly Owned Subsidiary” of
any Person means any Subsidiary of such Person to the extent all of the
outstanding Capital Stock or other ownership interests of which (other than in
the case of a Foreign Subsidiary, directors’ qualifying shares or an immaterial
amount of shares owned by other Persons pursuant to applicable law) are owned
by such Person or any Wholly Owned Subsidiary of such Person; provided, however,
that each of Tioxide Group and Holdings U.K. shall be deemed to Wholly Owned
Subsidiaries.

 

“Wholly Owned Restricted
Subsidiary” means a Restricted Subsidiary that is a Wholly Owned Subsidiary.

 

Section 1.02                                Incorporation by
Reference of TIA.  Whenever
this Indenture refers to a provision of the TIA, that portion of such provision
that is required to be incorporated for this Indenture to be qualified under
the TIA is incorporated by reference in, and made a part of, this 

 

27

 

Indenture. 
The following TIA terms used in this Indenture have the following
meanings:

 

“indenture securities” means
the Notes.

 

“indenture to be qualified”
means this Indenture.

 

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

 

“obligor” on the Indenture
securities means the Company or any other obligor on the Notes.

 

All other TIA terms used in
this Indenture that are defined by the TIA, defined by the TIA by reference to
another statute or defined by SEC rule and not otherwise defined herein
have the meanings assigned to them therein.

 

Section 1.03                                Rules of
Construction.  Unless the
context otherwise requires:

 

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

 

(2)                                  an accounting
term not otherwise defined has the meaning assigned to it in accordance with
GAAP as in effect on the Designated Date;

 

(3)                                  “or” is not
exclusive;

 

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

 

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

 

ARTICLE II

THE NOTES

 

Section 2.01                                Form and
Dating.  Notes and the certificate of
authentication relating thereto shall be substantially in the form of Exhibit A
hereto.  The Notes may have notations,
legends or endorsements required by law, stock exchange rule or
usage.  Notes that are Restricted
Securities (including the Initial Notes) shall bear the Private Placement Legend.  Each Note shall be dated the date of issuance
and shall show the date of its authentication. 
Each Note shall have an executed Guarantee from each of the Guarantors
endorsed thereon substantially in the form of Exhibit E hereto.

 

The terms and provisions
contained in the Notes annexed hereto as Exhibit A, shall constitute, and
are hereby expressly made, a part of this 
Indenture and, to the extent applicable, the Company, the Guarantors and
the Trustee, by their execution and delivery of this Indenture, expressly agree
to such terms and provisions and to be bound thereby.

 

28

 

(a)                                  Restricted
Global Securities.

 

(i)                  Notes that are
Restricted Securities shall be issued in the- form of one or more global
securities (each, a “Restricted Global Security”) in definitive, fully
registered form without interest coupons, with the legend provided for in Exhibit B
hereto, except as otherwise permitted herein.

 

(ii)               Each Restricted
Global Security shall be registered in the name of DTC or its nominee and
deposited with the Trustee, at its Corporate Trust Office, as custodian for
DTC, duly executed by the Company and authenticated by the Trustee as
hereinafter provided.  The aggregate
principal amount of a Restricted Global Security may from time to time be
increased or decreased by adjustments made on the records of the Trustee, as
custodian for DTC, in connection with a corresponding decrease or increase in
the aggregate principal amount of a Regulation S Global Security or an
Unrestricted Global Security, as hereinafter provided.

 

(b)                                 Regulation S
Global Securities.

 

(i)                  Notes offered and sold in
offshore transactions in reliance on Regulation S shall be issued in the form
of one or more Restricted Global Securities (the “Regulation S Global Security”)
deposited with the custodian for the Depositary, and registered in the name of
the Depositary or its nominee for the accounts of the Euroclear System, as
operated by Euroclear Bank S.A./N.V. and Clearstream, duly executed by the
Company and authenticated by the Trustee as hereinafter provided.  During or prior to the end of the 40-day
restricted period within the meaning of Regulation S, beneficial interests in
the Regulation S Global Security may only be held through Euroclear and
Clearstream. Any resale or transfer of beneficial interests in the Regulation S
Global Security shall be made only pursuant to Rule 144A or Regulation S
or another exemption from the Registration requirements of the Securities Act,
after delivery to the Company by the transferor, if required by the Company, of
the opinions, certification or other information described in Section 2.17.  The aggregate principal amount of the
Regulation S Global Security as may from time to time be increased or decreased
by adjustments made in the records of the Trustee, as custodian for the
Depositary or its nominee, as herein provided.

 

(c)                                  Physical Notes.  Notes issued in exchange for interests in a
Global Note pursuant to Section 2.15 may be issued in the form of
permanent certificated Notes in registered form in substantially the form set
forth in Exhibit A (the “Physical Notes”).

 

Section 2.02                                Execution and
Authentication; Aggregate Principal Amount.  A duly authorized Officer of the Company
shall execute the Notes for the Company, and a duly authorized officer of each
Guarantor shall sign the Guarantees for the Guarantors, in each case by manual
or facsimile signature.

 

If an Officer whose
signature is on a Note or a Guarantee, as the case may be, was an Officer at
the time of such execution but no longer holds that office or position at the
time the 

 

29

 

Trustee authenticates the
Note, the Note shall nevertheless be valid.

 

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

 

On July 6, 2009, upon
Company Order the Trustee authenticated and delivered Notes for original issue
in an initial aggregate principal amount of $600,000,000.  In addition, at any time, from time to time,
the Trustee shall authenticate and deliver Exchange Notes in the form of
Unrestricted Notes, upon a written notice of the Company for original issuance
in the aggregate principal amount specified in such order for original issue in
the aggregate principal amount, provided that Exchange Notes shall be issuable
only upon the valid surrender for cancellation of Global Securities or other
Notes of a like aggregate principal amount. 
Additional Notes may be issued in accordance with Sections 2.01 and
2.18.  Any such Company Order may specify
the amount of the Notes to be authenticated and the date on which the original
issue of Notes is to be authenticated, whether such Notes are Unrestricted
Notes and whether (subject to Section 2.01) the Notes are to be issued as
Physical Notes or Global Notes and such other information as the Trustee may
reasonably request and, in the case of an issuance of Additional Notes pursuant
to Section 2.18 after the Issue Date, shall certify that such issuance
will not be prohibited by Section 4.12.

 

Notwithstanding the
foregoing, all Notes issued under this Indenture shall vote and consent
together on all matters (as to which any of such Notes may vote or consent) as
one class.

 

The Trustee may appoint an
authenticating agent reasonably acceptable to the Company to authenticate
Notes.  Unless otherwise provided in the
appointment, an authenticating agent may authenticate Notes whenever the
Trustee may do so.  Each reference in
this Indenture to authentication by the Trustee includes authentication by such
agent.  An authenticating agent has the
same rights as an Agent to deal with the Company and Affiliates of the Company.

 

The Notes shall be issuable
in fully registered form only, without coupons, in minimum denominations of
$2,000 and integral multiples of $1,000 in excess thereof.

 

Section 2.03                                Registrar and
Paying Agent.  The Company
shall maintain an office or agency, where (a) Notes may be presented or
surrendered for registration of transfer or for exchange (“Registrar”), (b) Notes
may be presented or surrendered for payment 
and (c) notices and demands to or upon the Company in respect of
the Notes and this Indenture may be served. 
The Paying Agent shall not be the Company or an Affiliate of the
Company.  The Registrar shall keep a
register of the Notes and of their transfer and exchange.  The Company, upon notice to the Trustee, may
have one or more co-Registrars and one or more additional paying agents
reasonably acceptable to the Trustee. 
The term “Paying Agent” includes any additional paying agent.  The Company may change the Paying Agent or
Registrar without notice to any Holder.

 

The Company shall enter into
an appropriate agency agreement with any Agent not a party to this Indenture,
which agreement shall incorporate the provisions of the TIA and 

 

30

 

implement the provisions of
this Indenture that relate to such Agent. 
The Company shall notify the Trustee, in advance, of the name and
address of any such Agent.  If the
Company fails to maintain a Registrar or Paying Agent, or fails to give the
foregoing notice, the Trustee shall act as such.

 

The Company initially
appoints the Trustee as Registrar and Paying Agent for the Notes until such
time as such entity has resigned or a successor has been appointed.  Any of the Registrar, the Paying Agent or any
other agent may resign upon 30 days’ notice to the Company.

 

Section 2.04                                Paying Agent To
Hold Assets in Trust.  The Company
shall require each Paying Agent other than the Trustee to agree in writing that
each Paying Agent shall hold in trust for the benefit of the Holders or the
Trustee all assets held by the Paying Agent for the payment of principal of,
premium, if any, or interest on, the Notes (whether such assets have been
distributed to it by the Company or any other obligor on the Notes), and shall
notify the Trustee of any default by the Company (or any other obligor on the
Notes) in making any such payment.  The Company
at any time may require a Paying Agent to distribute all assets held by it to
the Trustee and account for any assets disbursed and the Trustee may at any
time during the continuance of any payment Default, upon written request to a
Paying Agent, require such Paying Agent to distribute all assets held by it to
the Trustee and to account for any assets distributed.  Upon distribution to the Trustee of all
assets that shall have been delivered by the Company to the Paying Agent and
the completion of any accounting required to be made hereunder, the Paying
Agent shall have no further liability for such assets.

 

Section 2.05                                Holder Lists.  The Trustee shall preserve in as current a
form as is reasonably practicable the most recent list available to it of the
names and addresses of the Holders and shall otherwise comply with TIA
§312(a).  If the Trustee is not the
Registrar or Paying Agent, the Company shall furnish annually on each May 15
and at such other times as the Trustee may request in writing a list in such
form as the Trustee may reasonably require of the names and addresses of the
Holders, which list may be conclusively relied upon by the Trustee.

 

Section 2.06                                Transfer and
Exchange.  Subject to
Sections 2.15 and 2.16, when Notes are presented to the Registrar or a
co-Registrar with a request to register the transfer of such Notes or to
exchange such Notes for an equal principal amount of Notes of other authorized
denominations, the Registrar or co-Registrar shall register the transfer or
make the exchange as requested if its requirements for such transaction are
met; provided, however, that the Notes presented or surrendered
for transfer or exchange shall be duly endorsed or accompanied by a written
instrument of transfer in form satisfactory to the Company and the Registrar or
co-Registrar, duly executed by the Holder thereof or his attorney duly
authorized in writing.  To permit
registrations of transfers and exchanges, the Company shall execute and the
Trustee shall authenticate Notes at the Registrar’s or co-Registrar’s written
request.  No service charge shall be made
for any registration of transfer or exchange, but the Company may require
payment of a sum sufficient to cover any transfer tax or similar governmental
charge payable in connection therewith. 
The Registrar or co-Registrar shall not be required to register the
transfer of or exchange of any Note (i) during a period beginning at the
opening of business 15 days before the mailing of a notice of redemption
pursuant to Section 3.03 and paragraph 5 of the Notes and 

 

31

 

ending at the close of business on the day of such
mailing and (ii) selected for redemption in whole or in part pursuant to Article Three,
except the unredeemed portion of any Note being redeemed in part.

 

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

 

Section 2.07                                Replacement
Notes.  If a mutilated Note is
surrendered to the Trustee or if the Holder of a Note claims that the Note has
been lost, destroyed or wrongfully taken, the Company shall issue and the
Trustee shall authenticate a replacement Note and each of the Guarantors shall
execute a Guarantee thereon if the Trustee’s requirements are met.  If required by the Trustee or the Company,
such Holder must provide an indemnity bond or other indemnity, sufficient in
the reasonable judgment of the Company, the Guarantors and the Trustee, to
protect the Company, the Guarantors, the Trustee or any Agent from any loss
which any of them may suffer if a Note is replaced.  The Company and the Trustee may charge such
Holder for their reasonable out-of-pocket expenses in replacing a Note,
including reasonable fees and expenses of counsel.  Every replacement Note shall constitute an
additional obligation of the Company and every replacement Guarantee shall
constitute an additional obligation of the Guarantors.

 

Section 2.08                                Outstanding
Notes.  Notes outstanding at any time
are all the Notes that have been authenticated by the Trustee except those
cancelled by it or a Registrar, those delivered to it or a Registrar for
cancellation and those described in this Section as not outstanding.  Subject to Section 2.09, a Note does not
cease to be outstanding because the Company or any of its Affiliates holds the
Note.

 

If a Note is replaced
pursuant to Section 2.07 (other than a mutilated Note surrendered for replacement),
it ceases to be outstanding unless the Trustee receives proof satisfactory to
it that the replaced Note is held by a bona fide purchaser.  A mutilated Note ceases to be outstanding
upon surrender of such Note and replacement thereof pursuant to Section 2.07.

 

If on a Redemption Date or
the Maturity Date, as applicable, the Paying Agent holds U.S. Legal Tender,
U.S. Government Obligations, or a combination thereof sufficient to pay all of
the principal, premium, if any, and interest due on the Notes payable on that
date, then on and after that date such Notes cease to be outstanding and interest
on them ceases to accrue.

 

If on any date which is no
earlier than 60 days prior to a Redemption Date, the Company has irrevocably
deposited in trust with the Trustee U.S. Legal Tender, U.S. Government
Obligations or a combination thereof in an amount sufficient to pay all of the
principal, premium, if any, and interest due on the Notes payable on such
Redemption Date, together with irrevocable instructions from the Company
directing the Trustee to apply such funds to the payment thereof on such
Redemption Date pursuant to the terms of this Indenture, then and after the
date of such deposit such Notes shall be deemed to be not outstanding for
purposes of determining whether 

 

32

 

the Holders of the required
aggregate principal amount of Notes have concurred in any direction, waiver,
consent or notice which requires the consent of at least a majority in aggregate
principal amount of Notes then outstanding.

 

Section 2.09                                Treasury Notes.  In determining whether the Holders of the
required aggregate principal amount of Notes have concurred in any direction,
waiver, consent or notice, Notes owned by the Company or an Affiliate shall be
considered as though they are not outstanding, except that for the purposes of
determining whether the Trustee shall be protected in relying on any such
direction, waiver or consent, only Notes which the Trustee actually knows are
so owned shall be so considered.  The
Company shall notify the Trustee, in writing, when it or any of its Affiliates
repurchases or otherwise acquires Notes, of the aggregate principal amount of
such Notes so repurchased or otherwise acquired.

 

Section 2.10                                [Intentionally
Omitted].

 

Section 2.11                                Cancellation.  The Company at any time may deliver Notes to
the Trustee for cancellation.  The
Registrar and the Paying Agent shall forward to the Trustee any Notes
surrendered to them for transfer, exchange or payment.  The Trustee, or at the direction of the
Trustee, the Registrar or the Paying Agent, and no one else, shall cancel and
shall dispose all cancelled Securities in accordance with its customary
procedures.  Subject to Section 2.07,
the Company may not issue new Notes to replace Notes that the Company has paid
or delivered to the Trustee for cancellation. 
Notes redeemed shall be cancelled. 
However, if the Company shall acquire any of the Notes, such acquisition
shall not operate as a redemption or satisfaction of the Indebtedness
represented by such Notes unless and until the same are surrendered to the
Trustee for cancellation pursuant to this Section 2.11.

 

Section 2.12                                Defaulted
Interest.  The Company
will pay interest on overdue principal from time to time on demand at the rate
of interest then borne by the Notes.  The
Company shall, to the extent lawful, pay interest on overdue installments of
interest (without regard to any applicable grace periods) from time to time on
demand at the rate of interest then borne by the Notes, as applicable.  Interest on the Notes will be computed on the
basis of a 360-day year comprised of twelve 30-day months.

 

If the Company defaults in a
payment of interest on the Notes, it shall pay the defaulted interest, plus (to
the extent lawful) any interest payable on the defaulted interest to the
Persons who are Holders on a subsequent special record date, which date shall
be the fifteenth day next preceding the date fixed by the Company for the
payment of defaulted interest or the next succeeding Business Day if such date
is not a Business Day.  At least 15 days
before the subsequent special record date, the Company shall deliver or cause
to be delivered to each Holder, with a copy to the Trustee, a notice that
states the subsequent special record date, the payment date and the amount of
defaulted interest, and interest payable on such defaulted interest, if any, to
be paid.

 

Notwithstanding the
foregoing, any interest which is paid prior to the expiration of the 30-day
period set forth in Section 6.01(a) shall be paid to Holders as of
the regular record date 

 

33

 

for the Interest Payment
Date for which interest has not been paid.

 

Section 2.13                                CUSIP Numbers.  The Company in issuing the Notes may use one
or more “CUSIP” and/or “ISIN” numbers, and if so, the Trustee shall use the
CUSIP and/or “ISIN” numbers in notices of redemption or exchange as a
convenience to Holders; provided, however, that no representation
is hereby deemed to be made by the Trustee as to the correctness or accuracy of
the CUSIP numbers printed in the notice or on the Notes, and that reliance may
be placed only on the other identification numbers printed on the Notes.  The Company shall promptly notify the Trustee
of any change in the CUSIP or “ISIN” number.

 

Section 2.14                                Deposit of
Moneys.  Prior to 11:00 a.m. New
York City time on each Interest Payment Date, Maturity Date, Redemption Date,
Change of Control Payment Date, and Net Proceeds Offer Payment Date, the
Company shall have deposited with each Paying Agent in immediately available
funds money sufficient to make cash payments, if any, due on such Interest
Payment Date, Maturity Date, Redemption Date, Change of Control Payment Date,
and Net Proceeds Offer Payment Date, as the case may be, in a timely manner
which permits each Paying Agent to remit payment to the Holders on such
Interest Payment Date, Maturity Date, Redemption Date, Change of Control
Payment Date, and Net Proceeds Offer Payment Date, as the case may be.

 

Section 2.15                                Book-Entry
Provisions for Global Securities.  Except as indicated below in this Section 2.15,
the Notes shall be represented only by Global Securities.  The Global Securities shall be deposited with
a Depositary for such Notes or its custodian (initially, the Trustee) (and
shall be registered in the name of such Depositary or its nominee).  The Depositary for the Notes shall be DTC
unless the Company appoints a successor Depositary by delivery of a Company
Order to the Trustee specifying such successor Depositary.

 

All payments on a Global
Security will be made to DTC or its nominee, as the case may be, as the
registered owner and Holder of such Global Security.  In each case, the Company will be fully
discharged by payment to or to the order of such Depositary from any
responsibility or liability in respect of each amount so paid.  Upon receipt of any such payment in respect
of a Global Security, DTC will credit Participants’ accounts with payments in
amounts proportionate to their respective beneficial interests in the principal
amount of such Global Security as shown on the records of DTC.

 

Unless and until it is
exchanged in whole or in part for Physical Notes, in accordance with this Section 2.15,
a Global Security may not be transferred except as a whole by the relevant
Depositary or nominee thereof to another nominee of the Depositary or to a
successor of Depositary or a nominee of such successor.

 

Owners of beneficial
interests in Global Securities shall be entitled or required, as the case may
be, but only under the circumstances described in this Section 2.15, to
receive physical delivery of Physical Notes.

 

Interests in a Global
Security shall be exchangeable or transferable, as the case may be, 

 

34

 

for Physical Notes if (i) DTC
notifies the Company that it is unwilling or unable to continue as Depositary
for such Global Security, or DTC ceases to be a “Clearing Agency” registered
under the United States Securities Exchange Act of 1934, and a successor
depositary is not appointed by the Company or (ii) an Event of Default has
occurred and is continuing with respect thereto and the owner of a beneficial
interest therein requests such exchange or transfer.  Upon the occurrence of any of the events
described in the preceding sentence, the Company shall cause the appropriate
Physical Notes to be delivered to the owners of beneficial interests in the
Global Securities or the Participants in DTC or Euroclear and Clearstream
through which such owners hold their beneficial interest.  Physical Notes shall be exchangeable or transferable
for interests in other Physical Notes as described herein.

 

Section 2.16                                Transfer and
Exchange of Securities.

 

(a)                                  Transfer and
Exchange of Global Securities.  Notwithstanding any provisions of this
Indenture or the Notes, transfers of a Global Security, in whole or in part,
transfers and exchanges of interests therein of the kinds described in clauses
(ii), (iii) and (iv) below and exchange of interests in Global
Securities or of other Securities as described in clause (v) below, shall
be made only in accordance with this Section 2.16(a).  Transfers and exchanges subject to this Section 2.16
shall also be subject to the other provisions of this Indenture that are not
inconsistent with this Section 2.16.

 

(i)                  General.  A Global Security may not be transferred, in
whole or in part, to any Person other than DTC or a nominee thereof or a
successor to DTC or its nominee, and no such transfer to any such other Person
may be registered; provided that this clause (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 Note to any Person shall be effective under this Indenture or the
Notes unless and until such Note has been registered in the name of such
Person.  Nothing in this Section 2.16(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 2.16(a).

 

(ii)               Restricted
Global Security to Regulation S Global Security.  If the Holder of a beneficial interest in a
Restricted Global Security wishes at any time to transfer such interest to a
Person who wishes to take delivery thereof in the form of a beneficial interest
in a Regulation S Global Security, such transfer may be effected, subject to
the rules and procedures of DTC, Euroclear and Clearstream, in each case
to the extent applicable (the “Applicable Procedures”), only in accordance with
the provisions of this Section 2.16(a)(ii).  Upon receipt by the Registrar of (A) written
instructions given in accordance with the Applicable Procedures from an Agent
Member directing the Registrar, to credit or cause to be credited to a
specified Agent Member’s account a beneficial interest in a Regulation S Global
Security in a principal amount equal to that of the beneficial interest in a
Restricted Global Security to be so transferred; (B) a written order given
in accordance with the Applicable Procedures containing information regarding
the account of the Agent Member (and/or the Euroclear or Clear-stream account,
as the case may be) to be credited with, and the account of the Agent

 

35

 

Member to be debited for, such beneficial interest and (C) a
certificate in substantially the form set forth in Exhibit C-1 given by
the Holder of such beneficial interest, the principal amount of a Restricted
Global Security shall be reduced, and the principal amount of a Regulation S
Global Security shall be increased, by the principal amount of the beneficial
interest in a Restricted Global Security to be so transferred, in each case by
means of an appropriate adjustment on the records of the Registrar.

 

(iii)            Restricted Global Security to Unrestricted
Global Security.  If the
Holder of a beneficial interest in a Restricted Global Security wishes at any
time to transfer such interest to a Person who wishes to take delivery thereof
in the form of a beneficial interest in an Unrestricted Global Security, such
transfer may be effected, subject to the Applicable Procedures, only in
accordance with this Section 2.16(a)(iii). 
Upon receipt by the Registrar of (A) written instructions given in
accordance with the Applicable Procedures from an Agent Member directing the
Registrar to credit or cause to be credited to a specified Agent Member’s
account a beneficial interest in an Unrestricted Global Security in a principal
amount equal to that of the beneficial interest in a Restricted Global Security
to be so transferred, (B) a written order given in accordance with the
Applicable Procedures containing information regarding the account of the Agent
Member (and, if applicable, the Euroclear or Clearstream account, as the case
may be) to be credited with, and the account of the Agent Member to be debited
for, such beneficial interest and (C) a certificate in substantially the
form set forth in Exhibit C-2 given by the Holder of such beneficial
interest, the principal amount of the Restricted Global Security shall be
reduced, and the principal amount of an Unrestricted Global Security shall be
increased, by the principal amount of the beneficial interest in a Restricted
Global Security to be so transferred, in each case by means of an appropriate
adjustment on the records of the Registrar and the Registrar shall instruct DTC
or its authorized representative to make a corresponding adjustment to its
records and to credit or cause to be credited to the account of the Person
specified in such instructions a beneficial interest in an Unrestricted Global
Security having a principal amount equal to the amount so transferred.

 

(iv)           Regulation S Global Security or Unrestricted Global
Security to Restricted Global Security.  If the Holder of a beneficial interest in a
Regulation S Global Security or an Unrestricted Global Security wishes at any
time to transfer such interest to a Person who wishes to take delivery thereof
in the form of a beneficial interest in a Restricted Global Security, such
transfer may be effected, subject to the Applicable Procedures, only in
accordance with this Section 2.16(a)(iv). 
Upon receipt by the Registrar of (A) written instructions given in
accordance with the Applicable Procedures from an Agent Member directing the
Registrar to credit or cause to be credited to a specified Agent Member’s
account a beneficial interest in a Restricted Global Security in a principal
amount equal to that of the beneficial interest in a Regulation S Global
Security or an Unrestricted Global Security to be so transferred, (B) a
written order given in accordance with the Applicable Procedures containing
information regarding the account of the Agent Member to be credited with, and
the account of the Agent Member 

 

36

 

(and, if applicable, the Euroclear or Clearstream account, as the case
may be) to be debited for, such beneficial interest and (C) with respect
to a transfer of a beneficial interest in a Regulation S Global Security (but
not an Unrestricted Global Security) to a Person whom the transferor reasonably
believes is a “qualified institutional buyer” within the meaning of Rule 144A
under the Securities Act, a certificate in substantially the form set forth in Exhibit C-3
given by the Holder of such beneficial interest, the principal amount of a
Restricted Global Security shall be increased, and the principal amount of a
Regulation S Global Security or an Unrestricted Global Security shall be
reduced, by the principal amount of the beneficial interest in a Restricted
Global Security to be so transferred, in each case by means of an appropriate
adjustment on the records of the Registrar.

 

(v)              Exchanges of Global Security for Non-Global
Security.  In the
event that a Global Security or any portion thereof is exchanged for securities
other than Global Securities, such other securities may in turn be exchanged
(on transfer or otherwise) for Notes that are not Global Securities or for
beneficial interests in a Global Security (if any is then outstanding) only in
accordance with such procedures, which shall be substantially consistent with
the provisions of clauses (i) through (iv) above and (vi) below
(including the certification requirements intended to insure that transfers and
exchanges of beneficial interests in a Global Security comply with Rule 144A,
Rule 144 or Regulation S, as the case may be) and any Applicable
Procedures, as may be from time to time adopted by the Company and the Trustee.

 

(vi)           Beneficial Interest in Regulation S Global Security
to be Held Through Euroclear or Clearstream.  Until the termination of the applicable
restricted period under Regulation S with respect thereto, interests in a
Regulation S Global Security may be held only through Agent Members acting for
and on behalf of Euroclear and Clearstream, provided that this clause (vi) shall
not prohibit any transfer in accordance with Section 2.16(a)(iv) hereof.

 

(b)                                 [Reserved].

 

(c)                                  Global
Securities.  The
provisions of clauses (i), (ii), (iii), and (iv) below shall apply only to
Global Securities;

 

(i)                  General.  Each Global Security authenticated under this
Indenture shall be registered in the name of the appropriate Depositary or a
nominee thereof and delivered to such Depositary or a nominee thereof or
custodian therefor.

 

(ii)               Transfer to Persons Other than Depositary.  Notwithstanding any other provision in this
Indenture or the Notes, no Global Security may be exchanged in whole or in part
for Notes registered, and no transfer of a Global Security in whole or in part
may be registered, in the name of any person other than the appropriate
Depositary or a nominee thereof unless (A) DTC notifies the Company that
it is unwilling or unable to continue as Depositary for such Global Security,
or DTC ceases to be a Clearing 

 

37

 

Agency registered under the United States Securities Exchange Act of
1934, and a successor to DTC is not appointed by the Company or (B) in the
case of any Global Security, an Event of Default has occurred and is continuing
with respect thereto and the owner of a beneficial interest therein requests
such exchange or transfer.  Any Global
Security exchanged pursuant to clause (A) above shall be so exchanged in
whole and not in part and any Global Security exchanged pursuant to clause (B) above
may be exchanged in whole or from time to time in part as directed by DTC.  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 appropriate Depositary or a nominee thereof shall not be a
Global Security.

 

(iii)            Global Security to Physical Note.  Physical Notes issued in exchange for a
Global Security or any portion thereof pursuant to clause (ii) above shall
be issued in definitive, fully registered form without interest coupons, and
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 appropriate Depositary shall designate
and shall bear any legends required hereunder. 
Any Global Security to be exchanged in whole shall be surrendered by the
appropriate Depositary to the 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 DTC 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, as Authenticating Agent.  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 appropriate Depositary or an authorized
representative thereof.

 

(iv)           In the event of the occurrence of any of the events
specified in clause (ii) above, the Company will promptly make available
to the Trustee a reasonable supply of Physical Notes in definitive, fully
registered form, without interest coupons.

 

(v)              No Rights of Agent Members in Global Security.  No Agent Member of any Depositary nor any
other Persons on whose behalf Agent Members may act (including Euroclear and
Clearstream and account Holders and Participants therein) shall have any rights
under this Indenture with respect to any Global Security, or under any Global
Security, and the Depositary or its 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 applicable Depositary or such
nominee, as the case may be, or impair, as between DTC, Euroclear and
Clearstream, their respective Agent Members and any other person on whose
behalf an Agent Member may act, the operation 

 

38

 

of customary practices of such Persons governing the exercise of the
rights of a Holder of any Note.

 

(vi)           Notwithstanding anything to the contrary in this
Indenture, all Global Securities shall be governed by the relevant Applicable
Procedures.

 

Section 2.17                              Special
Transfer Provisions.

 

(a)                                  Transfers to
Institutional Accredited Investors.  If Notes are being transferred to an
Institutional Accredited Investor, the Notes shall be accompanied by delivery
of a transferee certificate for Institutional Accredited Investors
substantially in the form of Exhibit D hereto and an Opinion of Counsel
reasonably satisfactory to the Company to the effect that such transfer is in
compliance with the Securities Act.

 

(b)                                 Other Transfers.  If a Holder proposes to transfer an Initial
Note pursuant to any exemption from the registration requirements of the
Securities Act other than as provided for above, the Registrar shall only
register such transfer or exchange if such transferor delivers to the Registrar
and the Trustee an Opinion of Counsel satisfactory to the Company and the Registrar
that such transfer is in compliance with the Securities Act and the terms of
this Indenture; provided that the Company may, based upon the opinion of
its counsel, instruct the Registrar by a Company Order not to register such
transfer in any case where the proposed transferee is not a QIB, an
Institutional Accredited Investor or a non-U.S. Person.

 

(c)                                  General.  By its acceptance of any Note bearing
legends, each- Holder of such a Note acknowledges the restrictions on transfer
of such Security set forth in this Indenture and in the legends and agrees that
it will transfer such Security only as provided in this Indenture.

 

The Registrar shall retain
copies of all letters, notices and other written communications received
pursuant to Section 2.15, 2.16 or this Section 2.17 for a period of
two years, after which time such letters, notices and other written
communications shall at the written request of the Company be delivered to the
Company.  The Company shall have the
right to inspect and make copies of all such letters, notices or other written
communications at any reasonable time upon the giving of reasonable prior
written notice to the Registrar.

 

Section 2.18                              Issuance of
Additional Notes.  The Company
shall be entitled to issue Additional Notes under this Indenture which shall
have substantially identical terms as the Initial Notes, other than with
respect to the date of issuance, issue price, amount of interest payable on the
first Interest Payment Date applicable thereto or upon a registration default
as provided under a registration rights agreement related thereto (and, if such
Additional Notes shall be issued in the form of Exchange Notes, other than with
respect to transfer restrictions); provided that such issuance is not prohibited
by Section 4.12.

 

With respect to any
Additional Notes, the Company shall set forth in a resolution of its Board of
Managers (or a duly appointed committee thereof) and in an Officers’
Certificate, a 

 

39

 

copy of each of which shall
be delivered to the Trustee, the following information:

 

(1)                                  the aggregate principal
amount of such Additional Notes to be authenticated and delivered pursuant to
this Indenture;

 

(2)                                  the issue price and the
issue date of such Additional Notes and the amount of interest payable on the
first Interest Payment Date applicable thereto; and

 

(3)                                  whether such Additional
Notes shall be Restricted Securities or Unrestricted Notes.

 

ARTICLE III

REDEMPTION

 

Section 3.01                              Notices to
Trustee.  If the Company elects to
redeem Notes pursuant to paragraph 5 of the Notes it shall notify the Trustee
and the Paying Agent in writing of the Redemption Date and the aggregate
principal amount of the Notes to be redeemed. 
Such notice must be given at least 30 days prior to the Redemption Date,
but shall not be given more than 60 days before such Redemption Date.  Any such notice may be cancelled at any time
prior to notice of such redemption being mailed to any Holder and shall thereby
be void and of no effect.

 

Section 3.02                              Selection of
Notes To Be Redeemed.  If less
than all the Notes are to be redeemed at any time, selection of such Notes for
redemption will be made by the Trustee in compliance with the requirements of
the principal national securities exchange, if any, on which such Notes are
listed or, if such Notes are not listed on a national securities exchange, on a
pro rata basis, by lot or by such method as the Trustee shall deem fair and
appropriate; provided, however, that no Notes of a principal amount of $2,000
or less shall be redeemed in part.

 

Section 3.03                              Notice of
Redemption.  At least 30
days but not more than 60 days before a Redemption Date, the Company shall mail
or cause to be mailed a notice of redemption by first- class mail to each
Holder whose Notes are to be redeemed at its registered address, with a copy to
the Trustee, except that redemption notices may be mailed more than 60 days
prior to a redemption date if the notice is issued in connection with a
defeasance of the notes or a satisfaction and discharge of this Indenture, in
each case in accordance with this Indenture. 
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, however,
that the Company shall deliver to the Trustee, at least 40 days prior to the
Redemption Date (which may be waived by the Trustee to a shorter notice period
to the Trustee), an Officers’ Certificate requesting that the Trustee give such
notice.  Each notice for redemption shall
identify the Notes to be redeemed and shall state:

 

(1)                                  the Redemption Date;

 

(2)                                  the redemption price and the
amount of accrued interest, if any, to be paid (the “Redemption Price”);

 

40

 

(3)                                  the paragraph of the Notes,
pursuant to which the Notes are being redeemed;

 

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

 

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

 

(6)                                  that, unless the Company
defaults in making the redemption payment, interest, if any, on Notes called
for redemption shall cease to accrue on and after the Redemption Date and the
only remaining right of the Holders of such Notes is to receive payment of the
Redemption Price upon surrender to the Paying Agent of the Notes redeemed;

 

(7)                                  that, if any Note is being
redeemed in part, the portion of the principal amount of such Note to be
redeemed;

 

(8)                                  that, if less than all the
Notes are to be redeemed, the identification of the particular Notes and the
aggregate principal amount (or portion thereof) of such Notes to be redeemed,
to be redeemed and the aggregate principal amount of Notes to be outstanding
after such partial redemption; and

 

(9)                                  whether the redemption is
conditioned on any events and what such conditions are.

 

If one or more conditions
specified with respect to a redemption are not satisfied or waived, the
Redemption Date shall be deemed not to have occurred for all purposes of this
Indenture and the Company shall give notice of such non-occurrence to the
Holders of the applicable Notes and to the Trustee.

 

The Company will comply with
the requirements of Rule 14e-1 under the Exchange Act and any other
securities laws and regulations thereunder to the extent such rule, laws and regulations
are applicable in connection with the purchase of Notes.

 

Section 3.04                              Effect of
Notice of Redemption.  Once notice
of redemption is mailed in accordance with Section 3.03, Notes called for
redemption become due and payable on the Redemption Date and at the Redemption
Price.  Upon surrender to the Trustee or
Paying Agent, such Notes called for redemption shall be paid at the Redemption
Price, but installments of interest, the maturity of which is on or prior to
the Redemption Date, shall be payable to Holders of record at the close of
business on the relevant record dates referred to in the Notes.  Interest shall accrue on or after the
Redemption Date and shall be payable only if the Company defaults in payment of
the Redemption Price.

 

Section 3.05                              Deposit of
Redemption Price.  On or
before the Redemption Date, the Company shall deposit with the Paying Agent
U.S. Legal Tender sufficient to pay the 

 

41

 

Redemption Price of all Notes to be redeemed on that
date.  The Paying Agent shall promptly return
to the Company any U.S. Legal Tender so deposited that is not required for that
purpose, except with respect to monies owed as obligations to the Trustee
pursuant to Article Seven.

 

Unless the Company fails to
comply with the preceding paragraph and defaults in the payment of such
Redemption Price, interest on the Notes to be redeemed will cease to accrue on
and after the applicable Redemption Date, whether or not such Notes are
presented for payment.

 

Section 3.06                              Notes Redeemed
in Part.  Upon surrender of a Note that
is to be redeemed in part, the Trustee shall authenticate for the Holder a new
Note or Notes equal in principal amount to the unredeemed portion of the Note
surrendered.

 

ARTICLE IV

COVENANTS

 

Section 4.01                              Payment of
Notes.  The Company shall pay the
interest on the Notes on the dates and in the manner provided in the
Notes.  An installment of principal of or
interest on the Notes shall be considered paid on the date it is due if the
Trustee or Paying Agent holds on that date U.S. Legal Tender designated for and
sufficient to pay the installment. 
Interest on the Notes will be computed on the basis of a 360- day year
comprised of twelve 30-day months.

 

Notwithstanding anything to
the contrary contained in this Indenture, the Company may, to the extent it is
required to do so by law, deduct or withhold income or other similar taxes
imposed by the United States of America from principal, premium or interest
payments hereunder.

 

Section 4.02                              Maintenance of
Office or Agency.  The Company
shall maintain the office or agency required under Section 2.03.  The Company shall give prior notice to the
Trustee of the location, and any change in the location, of such office or
agency.  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.

 

Section 4.03                              Limitation on
Restricted Payments.  The Company
shall not, and shall not cause or permit any of its Restricted Subsidiaries to,
directly or indirectly, make any Restricted Payment if at the time of such
Restricted Payment or immediately after giving effect thereto, (i) a
Default or an Event of Default shall have occurred and be continuing, (ii) the
Company is not able to incur at least $1.00 of additional Indebtedness other
than Permitted Indebtedness in compliance with Section 4.12, or (iii) the
aggregate amount of Restricted Payments including such proposed Restricted
Payment made after June 30, 2006, including, the Fair Market Value as
determined reasonably and in good faith by the Board of Managers of the Company
of non-cash amounts constituting Restricted Payments shall exceed the sum
of:  (w) 50% of the cumulative
Consolidated Net Income (or if cumulative Consolidated Net Income shall be a
loss, minus 100% of such loss) of the Company earned from June 30, 2006
through the last day of the last full fiscal quarter immediately preceding the
date the Restricted Payment occurs (the “Reference 

 

42

 

Date”) (treating such period as a single accounting
period); plus (x) 100% of the aggregate net cash proceeds received by the
Company from any Person (other than a Subsidiary of the Company) from the
issuance and sale subsequent to June 30, 2006 of Qualified Capital Stock
of the Company (other than Specified Venture Capital Stock) or debt securities
of the Company that are, upon issuance, convertible into or exchangeable for
Qualified Capital Stock of the Company, but only when and to the extent such
debt securities are converted into or exchanged for Qualified Capital Stock of
the Company; plus (y) without duplication of any amounts included in
clause (iii)(x) above, 100% of the aggregate net cash proceeds of any
equity contribution received by the Company from a holder of the Company’s
Capital Stock subsequent to June 30, 2006; plus (z) $400 million.

 

Notwithstanding the
foregoing, the provisions set forth in the immediately preceding paragraph
shall not prohibit:  (1) the payment
of any dividend within 60 days after the date of declaration of such dividend
if the dividend would have been permitted on the date of declaration; (2) the
acquisition of any shares of Capital Stock of the Company, either (i) solely
in exchange for shares of Qualified Capital Stock of the Company or (ii) if
no Default or Event of Default shall have occurred and be continuing, through
the application of net cash proceeds of a substantially concurrent Equity
Offering (other than to a Subsidiary of the Company); (3) the acquisition
or repayment of any Indebtedness of the Company that is subordinate or junior
in right of payment to the Notes either (i) solely in exchange for shares
of Qualified Capital Stock of the Company, or (ii) if no Default or Event
of Default shall have occurred and be continuing, through the application of
net cash proceeds of (A) a substantially concurrent Equity Offering or (B) incurrence
for cash of Refinancing Indebtedness, (in the case of (A) or (B), other
than to a Subsidiary of the Company); (4) so long as no Default or Event
of Default shall have occurred and be continuing, repurchases by the Company
of, or dividends to a Huntsman Parent Company to permit repurchases by a
Huntsman Parent Company of, Common Stock of the Company or a Huntsman Parent
Company from employees of the Company or any of its Subsidiaries or their
authorized representatives upon the death, disability or termination of
employment of such employees, in an aggregate amount not to exceed $25 million
in any calendar year; (5) the redemption or repurchase of any Common Stock
of the Company held by a Restricted Subsidiary of the Company which obtained
such Common Stock directly from the Company; (6) distributions to any Huntsman
Parent Company in accordance with the Tax Sharing Agreement; (7) payments
to any Huntsman Parent Company for legal, audit and other expenses directly
relating to the administration of such Huntsman Parent Company not to exceed
$10.0 million in any fiscal year; (8) the payment of consideration by a
third party to equity holders of the Company; (9) additional Restricted
Payments in an aggregate amount not to exceed $225 million since the Designated
Date; (10) the payment of dividends or distributions to any Huntsman
Parent Company which are contemporaneously applied to pay dividends on common
stock of the Huntsman Public Parent at a rate not to exceed $0.40 per share per
annum (such amount to be appropriately adjusted to reflect any stock split,
reverse stock split, stock dividend, stock issuance or similar transactions
made after the Designated Date so that the aggregate amount of dividends
payable after such transaction is the same as the amount payable immediately
prior to such transaction); (11) payments of dividends on Disqualified
Capital Stock issued in accordance with Section 4.12; and (12) if the
Consolidated Leverage Ratio of the Company, calculated after 

 

43

 

giving pro forma effect to any repurchase under
this clause (12), is less than 2.5 to 1.0, then the Company may repurchase
or dividend to a Huntsman Parent Company to repurchase, up to an aggregate of
$250 million of Common Stock of a Huntsman Parent Company.  In determining the aggregate amount of
Restricted Payments made subsequent to the Designated Date in accordance with
clause (iii) of the immediately preceding paragraph, cash amounts expended
pursuant to clauses (1), (2), (3)(ii)(A) and (4) shall be included in
such calculation and Restricted Payments made pursuant to the other clauses of
this paragraph shall not be so included.

 

Not later than the date of
making any Restricted Payment pursuant to clause (iii) of the second
preceding paragraph or clause (9) of the immediately preceding paragraph,
the Company shall deliver to the Trustee an officers’ certificate stating that
such Restricted Payment complies with this Indenture and setting forth in
reasonable detail the basis upon which the required calculations were computed,
which calculations may be based upon the Company’s quarterly financial
statements last provided to the Trustee pursuant to Section 4.09.

 

Section 4.04                              Corporate
Existence.  Except as
otherwise permitted by Article Five, the Company shall do or cause to be
done all things reasonably necessary to preserve and keep in full force and
effect its corporate or other existence and the corporate or other existence of
each of its Restricted Subsidiaries in accordance with the respective
organizational documents of each such Restricted Subsidiary and the material
rights (charter and statutory) and franchises of the Company and each such
Restricted Subsidiary; except for such noncompliances as are not in the
aggregate reasonably likely to have a material adverse effect on the financial
condition or results of operations of the Company and its Restricted
Subsidiaries taken as a whole.

 

Section 4.05                              Payment of
Taxes and Other Claims.  The
Company shall pay or discharge or cause to be paid or discharged, before the
same shall become delinquent, (i) all material taxes, assessments and
governmental charges (including withholding taxes and any penalties, interest
and additions to taxes) levied or imposed upon it or any of its Restricted
Subsidiaries or properties of it or any of its Restricted Subsidiaries and (ii) all
material lawful claims for labor, materials, supplies and services that, if
unpaid, might by law become a Lien upon the property of it or any of its
Restricted Subsidiaries; except for such noncompliances as are not in the
aggregate reasonably likely to have a material adverse effect on the financial
condition or results of operations of the Company and its Restricted
Subsidiaries as a whole; provided, however, that there shall not
be required to be paid or discharged any such tax, assessment or charge, the
amount, applicability or validity of which is being contested in good faith by
appropriate proceedings and for which adequate provision has been made or where
the failure to effect such payment or discharge is not adverse in any material
respect to the Holders.

 

Section 4.06                              Maintenance of
Properties and Insurance.

 

(a)                                  The Company
shall, and shall cause each of its Restricted Subsidiaries to, make all
reasonable efforts to maintain its material properties in normal condition
(subject to ordinary wear and tear) and make all reasonably necessary repairs,
renewals or replacements thereto as in the judgment of the Company may be
reasonably necessary to the conduct of the business of the Company and its
Restricted Subsidiaries; except for such noncompliances as are

 

44

 

not in the aggregate reasonably
likely to have a material adverse effect on the financial condition or results
of operations of the Company and its Restricted Subsidiaries taken as a whole.

 

(b)           The Company shall provide or cause to
be provided, for itself and each of its Restricted Subsidiaries, insurance
(including appropriate self- insurance) against loss or damage of the kinds
that, in the reasonable, good faith opinion of the Company, are reasonably
adequate and appropriate for the conduct of the business of the Company and
such Restricted Subsidiaries.

 

Section 4.07                                Compliance
Certificate; Notice of Default.

 

(a)           The Company shall deliver to the
Trustee, within 120 days after the end of each of the Company’s fiscal years
commencing with the fiscal year ending December 31, 2009, an Officers’
Certificate stating that a review of its activities and the activities of its
Restricted Subsidiaries during the preceding fiscal year has been made under
the supervision of the signing officers with a view to determining whether it
has kept, observed, performed and fulfilled its obligations under this
Indenture and further stating, as to each such officer signing such
certificate, that to the best of his knowledge at the date of such certificate
there is no Default or Event of Default that has occurred and is continuing or,
if such signers do know of such Default or Event of Default, the certificate
shall describe the Default or Event of Default and its status with particularity.  The Officers’ Certificate shall also notify
the Trustee should the Company elect to change the manner in which it fixes its
fiscal year end.

 

(b)           The annual financial statements
delivered to the Trustee pursuant to Section 4.09 shall be accompanied by
a written report of the Company’s independent accountants that in conducting
their audit of the financial statements which are a part of such annual report
or such annual financial statements nothing has come to their attention that
would lead them to believe that the Company has violated any provisions of Article Four
or Five insofar as they relate to accounting matters or, if any such violation
has occurred, specifying the nature and period of existence thereof, it being
understood that such accountants shall not be liable directly or indirectly to
any Person for any failure to obtain knowledge of any such violation.

 

(c)           So long as any of the Notes are
outstanding (i) if any Default or Event of Default has occurred and is
continuing or (ii) if any Holder seeks to exercise any remedy hereunder with
respect to a claimed Default under this Indenture or the Notes, the Company
shall deliver to the Trustee as soon as practicable by registered or certified
mail or by telegram, telex or facsimile transmission followed by hard copy by
registered or certified mail an Officers’ Certificate specifying such event,
notice or other action.

 

Section 4.08           Compliance with Laws.  The Company shall comply, and shall cause
each of its Restricted Subsidiaries to comply, with all applicable statutes,
rules, regulations, orders and restrictions of the United States of America,
all states and municipalities thereof, and of any governmental department,
commission, board, regulatory authority, bureau, agency and instrumentality of
the foregoing, in respect of the conduct of their respective businesses and the
ownership of their respective properties, except for such noncompliances as are
not in the 

 

45

 

aggregate reasonably likely to have a material
adverse effect on the financial condition or results of operations of the
Company and its Restricted Subsidiaries taken as a whole.

 

Section 4.09                               Reports to
Holders.  Whether or not required by the
Commission, so long as any Notes are outstanding, the Company will furnish to
the Holders of the Notes and to the Trustee, within the time periods specified
in the Commission’s rules and regulations including any extension periods
available under such rules and regulations and excluding any requirement
and time periods applicable to “accelerated filers” (as defined in Rule 12b-2
under the Exchange Act) under such rules and regulations, and make
available to securities analysts and potential investors upon request:

 

(1)           all
quarterly and annual financial information that would be required to be
contained in a filing with the Commission on Forms 10-Q and 10-K if the Company
were required to file such Forms, including a “Narrative Analysis of Results of
Operations” or “Management’s Discussion and Analysis of Financial Condition and
Results of Operations,” as applicable, and, with respect to the annual
information only, a report on the annual financial statements by the Company’s
certified independent accountants; and

 

(2)           all
current reports that would be required to be filed with the Commission on Form 8-K
if the Company were required to file such reports.

 

Notwithstanding the
foregoing, the Company shall not be required to furnish any information or
reports that are separate from information or reports furnished by Huntsman
Corporation, and the requirements specified in this paragraph shall be deemed
to be satisfied upon Huntsman Corporation’s filing of its required reports
within the time periods specified in the Commission’s rules and
regulations including any extension periods available under such rules and
regulations, in each case provided that the assets, liabilities, revenues and
net income of Huntsman Corporation are substantially similar to those of the
Company at the time of such filing.

 

If the Company has
designated as an Unrestricted Subsidiary any of its Subsidiaries that would
constitute a significant subsidiary within the meaning of Regulation S-X under
the Exchange Act, then the quarterly and annual financial information required
by the preceding paragraph shall include a reasonably detailed presentation,
either on the face of the financial statements or in the footnotes or schedules
thereto, or in Narrative Analysis of Results of Operations, of the financial
condition and results of operations of the Company and its Restricted Subsidiaries
separate from the financial condition and results of operations of the
Unrestricted Subsidiaries of the Company.

 

In the event that any
Huntsman Parent Company becomes a Guarantor of the Notes, the Company may
satisfy its obligations under this Section 4.09 with respect to financial
information relating to the Company by furnishing financial information
relating to such Huntsman Parent Company as provided in Section 3-10 of
Regulation S-X under the Exchange Act.

 

Section 4.10                               Waiver of Stay,
Extension or Usury Laws.  The
Company covenants (to 

 

46

 

the extent that it may lawfully do so) that it will
not at any time insist upon, plead, or in any manner whatsoever claim or take
the benefit or advantage of, any stay or extension law or any usury law or
other law that would prohibit or forgive the Company from paying all or any
portion of the principal of, premium or interest on the Notes as contemplated
herein, wherever enacted, now or at any time hereafter in force, or which may
affect the obligations or the performance of this Indenture; and (to the extent
that it may lawfully do so) the Company 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.

 

Section 4.11                                Limitations on
Transactions with Affiliates.

 

(a)           The Company will not, and will not
permit any of its Restricted Subsidiaries to, directly or indirectly, enter
into or permit to exist any transaction or series of related transactions with,
or for the benefit of, any of its Affiliates (each an “Affiliate Transaction”),
other than (x) Affiliate Transactions permitted under paragraph (b) below
and (y) Affiliate Transactions on terms that are no less favorable to the
Company or the relevant Restricted Subsidiary than those terms that might reasonably
have been obtained in a comparable transaction at such time on an arm’s-length
basis by the Company or the relevant Restricted Subsidiary and an unrelated
Person.  The Board of Managers of the
Company or the Board of Managers of the relevant Restricted Subsidiary must
approve each Affiliate Transaction to which they are a party that involves
aggregate payments or other property with a Fair Market Value in excess of
$25.0 million.  This approval must be evidenced
by a Board Resolution that states that the applicable Board of Managers has
determined that the transaction complies with the foregoing provisions.  If the Company or any Restricted Subsidiary
of the Company enters into an Affiliate Transaction that involves an aggregate
Fair Market Value of more than $50.0 million, then prior to the consummation of
the Affiliate Transaction, the parties to such Affiliate Transaction must
obtain a favorable opinion as to the fairness of such transaction or series of
related transactions to the Company or the relevant Restricted Subsidiary, as the
case may be, from a financial point of view, from an Independent Financial
Advisor and file the same with the Trustee.

 

(b)           The restrictions set forth in clause (a) shall
not apply to (i) reasonable fees and compensation paid to and indemnity
provided on behalf of, officers, directors, manager, employees or consultants
of the Company or any Restricted Subsidiary of the Company as determined in
good faith by the Company’s Board of Managers or senior management; (ii) transactions
exclusively between or among the Company and any of its Restricted Subsidiaries
or exclusively between or among such Restricted Subsidiaries, provided such
transactions are not otherwise prohibited by this Indenture; (iii) any
agreement as in effect as of the Issue Date or any amendment thereto or any
transaction contemplated thereby or in any replacement agreement thereto so
long as any such amendment or replacement agreement is not more disadvantageous
to the Holders in any material respect than the original agreement; (iv) Permitted
Investments and Restricted Payments made in compliance with Section 4.03; (v) transactions
between or among any of the Company, any of its Subsidiaries and any
Securitization Entity in connection with a 

 

47

 

Qualified Securitization
Transaction, in each case provided that such transactions are not
otherwise prohibited by this Indenture; (vi) transactions with
distributors or other purchases or sales of goods or services, in each case in
the ordinary course of business and otherwise in compliance with the terms of
this Indenture which when taken together are fair to the Company or the
Restricted Subsidiaries as applicable, in the reasonable determination of the
Board of Managers of the Company or the senior management thereof, or are on
terms at least as favorable as might reasonably have been obtained at such time
from an unaffiliated party and (vii) Guarantees by the Company or a
Guarantor incurred in accordance with clause (xxii) of the definition of Permitted
Indebtedness.

 

Section 4.12                               Limitation on
Incurrence of Additional Indebtedness.  The Company will not, and will not permit any
of its Restricted Subsidiaries to, directly or indirectly, create, incur,
assume, guarantee, acquire, become liable, contingently or otherwise, with
respect to, or otherwise become responsible for payment of (collectively, “incur”)
any Indebtedness (other than Permitted Indebtedness); provided, however, if no
Default or Event of Default shall have occurred and be continuing at the time
of or as a consequence of the incurrence of any such Indebtedness, the Company
and its Restricted Subsidiaries may incur Indebtedness (including Acquired
Indebtedness) in each case if on the date of the incurrence of such
Indebtedness, after giving effect to the incurrence thereof, the Consolidated
Fixed Charge Coverage Ratio of the Company is greater than 2.0 to 1.0.

 

Section 4.13                               Limitation on
Dividend and Other Payment Restrictions Affecting Subsidiaries.  The Company will not, and will not cause or
permit any of its Restricted Subsidiaries to, directly or indirectly, create or
otherwise cause or permit to exist or become effective any encumbrance or
restriction on the ability of any Restricted Subsidiary of the Company to (a) pay
dividends or make any other distributions on or in respect of its Capital
Stock; (b) make loans or advances or to pay any Indebtedness or other
obligation owed to the Company or any other Restricted Subsidiary of the
Company; or (c) transfer any of its property or assets to the Company or
any other Restricted Subsidiary of the Company, except for such encumbrances or
restrictions existing under or by reason of: 
(1) applicable law, rules, regulations and/or orders; (2) 
this Indenture (including, without limitation, any Liens permitted hereunder); (3) customary
non-assignment provisions of any contract or any lease governing a leasehold
interest of the Company or any Restricted Subsidiary of the Company; (4) any
agreements existing at the time of any merger or consolidation with any Person,
acquisition of any Person or the properties or assets of such Person (including
agreements governing Acquired Indebtedness), which encumbrance or restriction
is not applicable to any Person, or the properties or assets of any Person, other
than the Person or the properties or assets of the Person merged or
consolidated with or so acquired or any Subsidiary of such Person; (5) agreements
existing on the Issue Date to the extent and in the manner such agreements are
in effect on such date and any amendments, modifications, restatements,
renewals, increases, supplements, refundings, replacements or refinancings
thereof, provided that such amendments, modifications, restatements, increases,
supplements, refundings, replacements or refinancings are no more restrictive
(as determined by the Board of Managers of the Company in their reasonable and
good faith judgment) in any material respect, taken as a whole, with respect to
such dividend and 

 

48

 

other payment restrictions than those contained in
such agreements or instruments as in effect on the Issue Date; (6) restrictions
imposed by any agreement to sell assets or Capital Stock permitted under this
Indenture to any Person pending the closing of such sale; (7) any
agreement or instrument governing Capital Stock of any Person that is acquired;
(8) Indebtedness or other contractual requirements of a Securitization
Entity in connection with a Qualified Securitization Transaction; provided that
such restrictions apply only to such Securitization Entity; (9) Liens
incurred in accordance with the covenant described under Section 4.18; (10) restrictions
on cash or other deposits or net worth imposed by customers under contracts
entered into in the ordinary course of business; (11) the Credit Facilities;
(12) any restriction under an agreement governing Indebtedness of a Foreign
Subsidiary permitted under Section 4.12; (13) customary restrictions in
Capitalized Lease Obligations, security agreements or mortgages securing
Indebtedness of the Company or a Restricted Subsidiary to the extent such
restrictions restrict the transfer of the property subject to such Capitalized
Lease Obligations, security agreements or mortgages; (14) customary provisions
in joint venture agreements and other similar agreements (in each case relating
solely to the respective joint venture or similar entity or the equity
interests therein) entered into in the ordinary course of business; (15)
contracts entered into in the ordinary course of business, not relating to
Indebtedness, and that do not, individually or in the aggregate, detract from
the value of property or assets of the Company or any Restricted Subsidiary in
any manner material to the Company or any Restricted Subsidiary; and (16) an
agreement governing Indebtedness incurred to Refinance the Indebtedness issued,
assumed or incurred pursuant to an agreement referred to in clause (2), (4),
(5), (8), (11), (12) or (13) above; provided, however, that the provisions
relating to such encumbrance or restriction contained in any such Indebtedness
are no less favorable to the Company in any material respect as determined by
the Board of Managers of the Company in their reasonable and good faith
judgment than the provisions relating to such encumbrance or restriction contained
in agreements referred to in such clause (2), (4), (5), (8), (11), (12) or
(13).

 

Section 4.14                               Change of
Control.

 

(a)                                  Upon the
occurrence of a Change of Control, each Holder will have the right to require
that the Company purchase all or a portion (equal to $2,000 or an integral
multiple of $1,000 in excess thereof) of such Holder’s Notes in cash pursuant
to the offer described below (the “Change of Control Offer”), at a purchase
price equal to 101% of the principal amount thereof plus accrued and unpaid
interest, if any, to the date of purchase.

 

(b)                                 [Reserved]

 

(c)                                  Within 30 days
following the date on which a Change of Control occurs (the “Change of Control
Date”), the Company shall send, by first class mail, postage prepaid, a notice
to each Holder of Notes at their last registered address and the Trustee, which
notice shall govern the terms of the Change of Control Offer.  The notice to the Holders shall contain all
instructions and materials necessary to enable such Holders to tender Notes
pursuant to the Change of Control Offer. 
Such notice shall state:

 

(1)           that the Change of Control Offer is
being made pursuant to 

 

49

 

Section 4.14
of this Indenture and that all Notes validly tendered and not withdrawn will be
accepted for payment;

 

(2)           the purchase price (including the
amount of accrued interest, if any) and the purchase date (which shall be no
earlier than 30 days nor later than 60 days from the date such notice is
mailed, other than as may be required by law) (the “Change of Control Payment
Date”);

 

(3)           that any Note not tendered will
continue to accrue interest;

 

(4)           that, unless the Company defaults in
making payment therefor, any Note accepted for payment pursuant to the Change
of Control Offer shall cease to accrue interest after the Change of Control
Payment Date;

 

(5)           that Holders electing to have a Note
purchased pursuant to a Change of Control Offer will be required to surrender
the Note, with the form entitled “Option of Holder to Elect Purchase” on the
reverse of the Note completed, to the Paying Agent and Registrar for the Notes
at the address specified in the notice prior to the close of business on the
third Business Day prior to the Change of Control Payment Date;

 

(6)           that Holders will be entitled to
withdraw their election if the Paying Agent receives, not later than the second
Business Day prior to the Change of Control Payment Date, a telegram, telex,
facsimile transmission or letter setting forth the name of the Holder, the
principal amount of the Notes the Holder delivered for purchase and a statement
that such Holder is withdrawing his election to have such Note purchased;

 

(7)           that Holders whose Notes are
purchased only in part will be issued new Notes in a principal amount equal to
the unpurchased portion of the Notes surrendered; provided, however,
that each Note purchased and each new Note issued shall be in a principal
amount of $2,000 or integral multiples of $1,000 in excess thereof; and

 

(8)           the circumstances and relevant facts
regarding such Change of Control.

 

(d)                                On or before
the Change of Control Payment Date, the Company shall (i) accept for
payment Notes or portions thereof (in minimum principal amount of $2,000 or
integral multiples of $1,000 in excess thereof) validly tendered pursuant to
the Change of Control Offer, (ii) deposit with the Paying Agent in
accordance with Section 2.14 cash sufficient to pay the purchase price
plus accrued and unpaid interest, if any, of all Notes to be purchased and (iii) deliver
to the Trustee Notes so accepted together with an Officers’ Certificate stating
the Notes or portions thereof being purchased by the Company.  Upon receipt by the Paying Agent of the
monies specified in clause (ii) above and a copy of the Officers’
Certificate specified in clause (iii) above, the Paying Agent shall
promptly pay to the Holders of Notes so accepted payment in 

 

50

 

an amount equal to the
purchase price plus accrued and unpaid interest, if any, out of the funds
deposited with the Paying Agent in accordance with the preceding sentence.  The Trustee shall promptly authenticate and
mail or cause to be transferred by book-entry to such Holders new Notes equal
in principal amount to any unpurchased portion of the Notes surrendered,
provided that each such new Note will be in a principal amount of $2,000 or
integral multiples of $1,000 in excess thereof. 
Upon the payment of the purchase price for the Notes accepted for
purchase, the Trustee shall return the Notes purchased to the Company for
cancellation.  Any monies remaining after
the purchase of Notes pursuant to a Change of Control Offer shall be returned
within three Business Days by the Trustee to the Company except with respect to
monies owed as obligations to the Trustee pursuant to Article Seven.  For purposes of this Section 4.14, the
Trustee shall act as the Paying Agent for the Notes.

 

(e)                                  The Company
will comply with the requirements of Rule 14e-1 under the Exchange Act and
any other securities laws and regulations thereunder to the extent such rule,
laws and regulations are applicable in connection with the purchase of the
Notes pursuant to a Change of Control Offer. 
To the extent the provisions of any securities laws and regulations
conflict with the provisions of this Indenture relating to a Change of Control
Offer, the Company shall comply with the applicable securities laws and
regulations and shall not be deemed to have breached its obligations relating
to such Change of Control Offer by virtue thereof.

 

(f)                                    The Company
will not be required to make a Change of Control Offer upon a Change of Control
if a third party makes the Change of Control Offer in the manner, at the times
and otherwise in compliance with the requirements set forth in this Indenture
with respect to a Change of Control Offer made by the Company and purchases all
Notes validly tendered and not withdrawn under such Change of Control Offer.

 

Section 4.15                               Limitation on
Asset Sales.

 

(a)                                  The Company
will not, and will not permit any of its Restricted Subsidiaries to, consummate
an Asset Sale unless (i) the Company or the applicable Restricted
Subsidiary receives consideration at the time of such Asset Sale at least equal
to the Fair Market Value of the assets sold or otherwise disposed of as
determined in good faith by the Company’s Board of Managers; and (ii) at
least 75% (or, in the case of an Asset Sale consisting of assets used or useful
in a business similar or related to the Pigments business of the Company and
its Subsidiaries, 65%) of the consideration received by the Company or the
applicable Restricted Subsidiary from such Asset Sale shall be in the form of
cash or Cash Equivalents, and is received at the time of the Asset Sale (which
shall be deemed to include other consideration converted to cash or Cash
Equivalents within 90 days of such Asset Sale).

 

(b)                                 For the
purposes of paragraph (a) above, the amount of any liabilities shown on
the most recent applicable balance sheet of the Company or the applicable
Restricted Subsidiary, other than liabilities that are by their terms
subordinated to the Notes, that are assumed by the transferee of any such
assets will be deemed to be cash for purposes of such provision.

 

51

 

(c)                                  Upon the
consummation of an Asset Sale, the Company may apply, or cause such applicable
Restricted Subsidiary to apply, the Net Cash Proceeds relating to such Asset
Sale within 415 days of having received the Net Cash Proceeds:

 

(i)      to
prepay any Senior Debt of the Company or a Guarantor or any Indebtedness of a
Restricted Subsidiary that is not a Guarantor and, in the case of any such
Indebtedness under any revolving credit facility, effect a permanent reduction
in the availability under such revolving credit facility, and/or

 

(ii)     to
make an investment in or expenditures for properties and assets (including
Capital Stock of any entity) that replace the properties and assets that were
the subject of the Asset Sale or in properties and assets (including Capital
Stock of any entity) that will be used in the business of the Company and its
Subsidiaries as existing on the Issue Date or in businesses reasonably related
thereto (“Replacement Assets”) and/or

 

(iii)    make
an acquisition of all of the capital stock or assets of any Person or division
conducting a business reasonably related to that of the Company or its
Subsidiaries.  On the 416th day after an
Asset Sale or any earlier date, if any, on which the Board of Managers of the
Company or of the applicable Restricted Subsidiary determines not to apply the
Net Cash Proceeds in accordance with the above provisions of this clause (c) (each,
a “Net Proceeds Offer Trigger Date”), such aggregate amount of Net Cash Proceeds
which have not been applied or contractually committed to be applied (and to
the extent not subsequently applied, the Net Proceeds Offer Trigger Date
related thereto shall be deemed to be the date of termination of such
contractual commitment or any earlier date, if any, on which the Board of
Managers of the Company or the board of the applicable Restricted Subsidiary
determines not to apply the Net Cash Proceeds in accordance with such
contractual commitment) on or before such Net Proceeds Offer Trigger Date as permitted
by the above provisions of this clause (c) (the “Net Proceeds Offer Amount”)
shall be applied by the Company or such Restricted Subsidiary to make an offer
to purchase (or repay, prepay or redeem, as the case may be) (the “Net Proceeds
Offer”) on a date (the “Net Proceeds Offer Payment Date”) that is not less than
30 nor more than 45 days following the applicable Net Proceeds Offer Trigger
Date, from all Holders and all holders of Indebtedness that is equal in right
of payment with the Notes and contains provisions requiring that an offer to
purchase such other Indebtedness be made with the proceeds of the Asset Sale,
on a pro rata basis, the maximum principal amount of Notes and other
Indebtedness that may be purchased with the Net Proceeds Offer Amount.  Notwithstanding the foregoing, the obligation
to make a Net Proceeds Offer shall be suspended until such time as the
aggregate amount of the Net Proceeds Offer Amount is equal to or exceeds $75
million.  The offer price in any Net
Proceeds Offer will be equal to 100% of the principal value of the Notes to be
purchased, plus any accrued and unpaid interest to the date of purchase.  The following events will be deemed to
constitute an Asset Sale and the Net Cash Proceeds for such Asset Sale must be
applied in accordance with this Section 4.15: in the event any non-cash
consideration 

 

52

 

received by the Company or any Restricted Subsidiary of the Company in
connection with any Asset Sale is converted into or sold or otherwise disposed
of for cash (other than interest received with respect to any such non-cash
consideration), or in the event of the transfer of substantially all (but not
all) of the property and assets of the Company and its Restricted Subsidiaries
as an entirety to a Person in a transaction permitted under Section 5.01
and as a result thereof the Company is no longer an obligor on the Notes, the
successor corporation shall be deemed to have sold the properties and assets of
the Company and its Restricted Subsidiaries not so transferred for purposes of
this Section 4.15, and shall comply with the provisions of this covenant
with respect to such deemed sale as if it were an Asset Sale.  In addition, the Fair Market Value of such
properties and assets of the Company or its Restricted Subsidiaries deemed to
be sold shall be deemed to be Net Cash Proceeds for purposes of this Section 4.15.

 

(d)                                 Notwithstanding
the immediately preceding paragraphs, the Company and its Restricted
Subsidiaries may consummate an Asset Sale without complying with such
paragraphs to the extent (i) at least 75% of the consideration for such
Asset Sale constitutes Replacement Assets and (ii) such Asset Sale is for
Fair Market Value; provided, however, that any consideration that does not
constitute Replacement Assets that is received by the Company or any of its
Restricted Subsidiaries in connection with any Asset Sale permitted under this
paragraph shall constitute Net Cash Proceeds and will be subject to the
provisions described in the preceding paragraphs.

 

(e)                                  Each notice of
a Net Proceeds Offer pursuant to this Section 4.15 shall be mailed, by
first-class mail, by the Company to Holders of Notes at their last registered
address not more than 30 days following the Net Proceeds Offer Trigger Date,
with a copy to the Trustee.  The notice
shall contain all instructions and materials necessary to enable such Holders
to tender Notes pursuant to the Net Proceeds Offer and shall state the following
terms:

 

(1)           that
the Net Proceeds Offer is being made pursuant to Section 4.15 of this
Indenture, that all Notes tendered will be accepted for payment; provided,
however, that if the aggregate principal amount of Notes tendered in a
Net Proceeds Offer plus accrued interest at the expiration of such offer
exceeds the aggregate amount of the Net Proceeds Offer, the Company shall
select the Notes to be purchased on a pro rata basis (with such adjustments as
may be deemed appropriate by the Company so that only Notes in denominations of
$2,000 or integral multiples of $1,000 in excess thereof shall be purchased)
and that the Net Proceeds Offer shall remain open for a period of 20 Business
Days or such longer periods as may be required by law;

 

(2)           the
purchase price (including the amount of accrued interest) and the Net Proceeds
Offer Payment Date (which shall be not less than 30 nor more than 45 days following
the applicable Net Proceeds Offer Trigger Date and which shall be at least five
Business Days after the Trustee receives notice thereof from the Company);

 

53

 

(3)           that
any Note not tendered will continue to accrue interest;

 

(4)           that,
unless the Company defaults in making payment therefor, any Note accepted for
payment pursuant to the Net Proceeds Offer shall cease to accrue interest after
the Net Proceeds Offer Payment Date;

 

(5)           that
Holders electing to have a Note purchased pursuant to a Net Proceeds Offer will
be required to surrender the Note, with the form entitled “Option of Holder to
Elect Purchase” on the reverse of the Note completed, to the Paying Agent at
the address specified in the notice prior to the close of business on the third
Business Day prior to the Net Proceeds Offer Payment Date;

 

(6)           that
Holders will be entitled to withdraw their election if the Paying Agent
receives, not later than the second Business Day prior to the Net Proceeds
Offer Payment Date, a telegram, telex, facsimile transmission or letter setting
forth the name of the Holder, the principal amount of the Notes the holder
delivered for purchase and a statement that such Holder is withdrawing his
election to have such Note purchased; and

 

(7)           that
Holders whose Notes are purchased only in part will be issued new Notes in a
principal amount equal to the unpurchased portion of the Note surrendered; provided,
however, that each new Note issued shall be in an original principal
amount of $2,000 or integral multiples of $1,000 in excess thereof.

 

On or before the Net
Proceeds Offer Payment Date, the Company shall (i) accept for payment
Notes or portions thereof (in minimum principal amount of $2,000 or integral
multiples of $1,000 in excess thereof validly tendered pursuant to the Net
Proceeds Offer, (ii) deposit with the Paying Agent, in accordance with Section 2.14,
U.S. Legal Tender sufficient to pay the purchase price plus accrued and unpaid
interest, if any, of all Notes to be purchased and (iii) deliver to the
Trustee Notes so accepted together with an Officers’ Certificate stating the
Notes or portions thereof being purchased by the Company.  Upon receipt by the Paying Agent of the
monies specified in clause (ii) above and a copy of the Officers’
Certificate specified in clause (iii) above, the Paying Agent shall
promptly pay to the Holders of Notes so accepted payment in an amount equal to
the purchase price plus accrued and unpaid interest, if any, out of the funds
deposited with the Paying Agent in accordance with the preceding sentence.  The Trustee shall promptly authenticate and
mail to such Holders new Notes equal in principal amount to any unpurchased
portion of the Notes surrendered.  Upon
the payment of the purchase price for the Notes accepted for purchase, the
Trustee shall cancel such Notes pursuant to Section 2.11 of this
Indenture.  Any monies remaining after
the purchase of Notes pursuant to a Net Proceeds Offer shall be returned within
three Business Days by the Trustee to the Company except with respect to monies
owed as obligations to the Trustee pursuant to Article Seven.  For purposes of this Section 4.15, the
Trustee shall act as the Paying Agent for the Notes.

 

To the extent the amount of
Notes tendered pursuant to any Net Proceeds Offer is less than the amount of
Net Cash Proceeds subject to such Net Proceeds Offer, the Company may use 

 

54

 

any remaining portion of
such Net Cash Proceeds not required to fund the repurchase of tendered Notes
for general corporate purposes and such Net Proceeds Offer Amount shall be reset
to zero.

 

The Company will comply with
the requirements of Rule 14e-1 under the Exchange Act and any other
securities laws and regulations thereunder to the extent such rule, laws and
regulations are applicable in connection with the repurchase of Notes pursuant
to a Net Proceeds Offer.  To the extent
the provisions of any securities laws and regulations conflict with the
provisions of this Indenture relating to a Net Proceeds Offer, the Company
shall comply with the applicable securities laws and regulations and shall not
be deemed to have breached its obligations relating to such Net Proceeds Offer
by virtue thereof.

 

Section 4.16           [Reserved].

 

Section 4.17           Limitation on Preferred Stock of Restricted
Subsidiaries.  The Company will not
permit any of its Restricted Subsidiaries to issue any Preferred Stock (other
than to the Company or to another Restricted Subsidiary of the Company) or
permit any Person (other than the Company or a Restricted Subsidiary of the
Company) to own any Preferred Stock of any Restricted Subsidiary of the
Company; provided, however, that any Person that is not a
Restricted Subsidiary of the Company may issue Preferred Stock to equity
holders of such Person in exchange for equity interests if after such issuance
such Person becomes a Restricted Subsidiary of the Company.

 

Section 4.18           Limitation on Liens.  The Company shall not, and shall not permit
any of its Restricted Subsidiaries to create, incur, or otherwise cause or
suffer to exist or become effective any Liens of any kind upon any property or
assets of the Company or any Restricted Subsidiary now owned or hereafter acquired,
which secures Subordinated Indebtedness unless such Indebtedness is incurred in
accordance with this Indenture and the Notes are secured on an equal and
ratable basis with the obligations so secured until such time as such
obligation is no longer secured by a Lien; provided that any such Lien shall be
subordinated to the Lien granted to the Holders in the same collateral as that
securing such Lien to the same extent as such Subordinated Indebtedness is
subordinated to the Notes.

 

Section 4.19           Limitation of Guarantees by Restricted Subsidiaries.  The Company will not permit any of its
Restricted Subsidiaries, directly or indirectly, by way of the pledge of any
intercompany note or otherwise, to assume, guarantee or in any other manner
become liable with respect to any Indebtedness of the Company or any other
Restricted Subsidiary (other than (A) Indebtedness under Commodity
Agreements and Currency Agreements in reliance on clause (v) of the
definition of Permitted Indebtedness, (B) Interest Swap Obligations incurred
in reliance on clause (iv) of the definition of Permitted Indebtedness, (C) any
guarantee by a Foreign Subsidiary of Indebtedness of another Foreign Subsidiary
permitted under Section 4.12), or (D) any guarantee of Acquired
Indebtedness of a person by any Subsidiary of such person which guarantee
constitutes Acquired Indebtedness, unless, in any such case (a) such
Restricted Subsidiary that is not a Guarantor executes and delivers a
supplemental indenture to this Indenture, providing a Guarantee by such
Restricted Subsidiary, (b) if any such assumption, guarantee or other
liability by such Restricted Subsidiary is provided in respect of Senior 

 

55

 

Indebtedness, then the guarantee or other instrument
provided by such Restricted Subsidiary in respect of such Senior Indebtedness
shall be pari passu in right of payment with the Guarantees and (c) any
such assumption, guarantee or other liability of such Restricted Subsidiary
that is provided in respect of Subordinated Indebtedness shall be subordinated
to the Guarantees in a manner substantially similar to the manner in which such
Subordinated Indebtedness is subordinated.

 

Section 4.20                               Conduct of
Business.  The Company
and its Restricted Subsidiaries (other than a Securitization Entity) will not
engage in any businesses which are not the same, similar or related to the
businesses in which the Company and its Restricted Subsidiaries were engaged on
the Issue Date, except to the extent that after engaging in any new business,
the Company and its Restricted Subsidiaries, taken as a whole, remain
substantially engaged in similar lines of business as were conducted by them on
the Issue Date.

 

Section 4.21                               Covenant
Termination.  After such
time as (i) the Notes have been assigned an Investment Grade Rating by
either Rating Agency (the “Investment Grade Rating Date”) and (ii) no
Default or Event of Default under this Indenture shall have occurred and be
continuing, and notwithstanding that the Notes may later cease to have an
Investment Grade Rating by any Rating Agency, the Company and its Restricted
Subsidiaries shall no longer be subject to the following sections:  Section 4.03, Section 4.11, Section 4.12,
Section 4.13, Section 4.15, Section 4.17, Section 4.19, Section 4.20
and Section 5.01(a)(iii) or (c)(iii). 
Notice of such covenant termination shall be provided in writing to the
Trustee.

 

ARTICLE V

SUCCESSOR CORPORATION

 

Section 5.01                               Merger,
Consolidation and Sale of Assets.

 

(a)                                  The Company
shall not, in a single transaction or a series of related transactions,
consolidate or merge with or into any Person, or sell, transfer or otherwise
dispose of (or permit any Restricted Subsidiary of the Company to sell, assign,
transfer, lease, convey or otherwise dispose of) all or substantially all of
the Company’s assets (determined on a consolidated basis for the Company and
its Restricted Subsidiaries), unless:

 

(i)      either
(1) the Company shall be the surviving or continuing entity or (2) the
Person (if other than the Company) formed by such consolidation or merger shall
be an entity organized and validly existing under the laws of the United States
or any State thereof or the District of Columbia (the “Surviving Entity”)

 

(ii)     the
Surviving Entity, if any, expressly assumes, by supplemental indenture (in form
and substance satisfactory to the Trustee), all rights and obligations of the
Company under the Notes and this Indenture;

 

(iii)    immediately
after giving effect to such transaction either (a) the Company or the
Surviving Entity shall be able to incur at least $1.00 of additional 

 

56

 

Indebtedness (other than Permitted Indebtedness) pursuant to Section 4.12
or (b) the Consolidated Fixed Charge Coverage Ratio of the Company or the
Surviving Entity would be greater than the Consolidated Fixed Charge Coverage
Ratio of the Company determined immediately prior to such transaction;

 

(iv)    immediately
before and after giving effect to such transaction, including the assumption of
the Notes, no Default or Event of Default occurred or exists; and

 

(v)     the
Company or the Surviving Entity shall have delivered to the Trustee an Officers’
Certificate and an Opinion of Counsel stating that all conditions precedent in
this Indenture relating to such transaction have been satisfied.

 

(b)                                 For purposes of
this Section 5.01, the transfer (by lease, assignment, sale or otherwise,
in a single transaction or series of related transactions) of all or
substantially all of the properties and assets of one or more Restricted
Subsidiaries of the Company, the Capital Stock of which constitutes all or
substantially all of the properties or assets of the Company, will be deemed to
be the transfer of all or substantially all of the properties and assets of the
Company.

 

(c)                                  Each Guarantor
(other than any Guarantor whose Guarantee is to be released in accordance with
the terms of the Guarantee and this Indenture in connection with any
transaction complying with the provisions of Section 4.15) will not, and
the Company will not cause or permit any Guarantor to, consolidate with or
merge with or into any Person other than the Company or any other Guarantor
unless: (i) the entity formed by or surviving any such consolidation or
merger (if other than the Guarantor) or to which such sale, lease, conveyance
or other disposition shall have been made assumes by supplemental indenture all
of the obligations of the Guarantor on its Guarantee; (ii) immediately
after giving effect to such transaction, no Default or Event of Default shall
have occurred and be continuing; and (iii) immediately after giving effect
to such transaction and the use of any net proceeds therefrom on a pro forma
basis, the Company could satisfy the provisions of Section 5.01(a)(iii).  Any merger or consolidation of a Guarantor
with and into the Company (with the Company being the surviving entity) or
another Guarantor need not comply with clause (a) above.

 

Notwithstanding anything in
this Section 5.01 to the contrary, (a) the Company may merge with an
Affiliate that has no material assets or liabilities and that is incorporated
or organized solely for the purpose of reincorporating or reorganizing the
Company in another state of the United States or the District of Columbia
without complying with Section 5.01(a)(iii) and (b) any
transaction characterized as a merger under applicable state law where each of
the constituent entities survives, shall not be treated as a merger for
purposes of this covenant, but shall instead be treated as (x) an Asset
Sale, if the result of such transaction is the transfer of assets by the
Company or a Restricted Subsidiary, or (y) an Investment, if the result of
such transaction is the acquisition of assets by the Company or a Restricted
Subsidiary.

 

Section 5.02                               Successor
Corporation Substituted.  Upon
any consolidation, combination 

 

57

 

or merger, or any transfer of all or substantially
all of the assets of the Company in accordance with Section 5.01 in which
the Company is not the Surviving Entity, the successor Person formed by such
consolidation or into which the Company is merged or to which such conveyance,
lease or transfer is made shall succeed to, and be substituted for, and may
exercise every right and power of, the Company under this Indenture and the
Notes with the same effect as if such Surviving Entity had been named as such.

 

ARTICLE VI

DEFAULT AND REMEDIES

 

Section 6.01                               Events of
Default.  Each of the following shall be
an “Event of Default”:

 

(1)           the
failure to pay interest on any Notes when the same becomes due and payable and
such Default continues for a period of 30 days;

 

(2)           the
failure to pay principal on any Notes, when such principal becomes due and
payable, at maturity, upon redemption or otherwise (including the failure to
make a payment when due to purchase the Notes tendered pursuant to a Change of
Control Offer or a Net Proceeds Offer);

 

(3)           the
failure of the Company or any Guarantor to comply with any covenant or
agreement contained in this Indenture, which default continues for a period of
60 days after the Company receives a written notice specifying the default (or
120 days after such a notice in the event of a Default under Section 4.09)
(and demanding that such default be remedied) from the Trustee or the Holders
of at least 25% of the outstanding principal amount of the Notes (including any
Additional Notes subsequently issued under this Indenture) (except in the case
of a default with respect to Section 5.01, which will constitute an Event
of Default with such notice requirement but without such passage of time requirement);

 

(4)           the
occurrence of any default under any agreement governing Indebtedness of the
Company or any of its Restricted Subsidiaries, if that default:  (A) is caused by the failure to pay at
final maturity the principal amount of any Indebtedness after giving effect to
any applicable grace periods and any extensions of time for payment of such
Indebtedness; or (B) results in
the acceleration of the final stated maturity of any such Indebtedness, and
in each case if the aggregate principal amount of such Indebtedness unpaid or
accelerated aggregates $100.0 million or more at any time, and in each case
such Indebtedness has not been discharged in full or such acceleration has not
been rescinded or annulled within 30 days of such final maturity or
acceleration;

 

(5)           the
failure of the Company or any of the Guarantors to pay or otherwise discharge
or stay one or more judgments in an aggregate amount exceeding $100.0 million
(which are not covered by indemnities or third party insurance as to which the
Person giving such indemnity or such insurer has not disclaimed coverage) for a
period of 60 days after such judgments become final and non-appealable;

 

58

 

(6)           the
Company or any Restricted Subsidiary which is also a Significant Subsidiary (A) commences
a voluntary case or proceeding under any Bankruptcy Law with respect to itself,
(B) consents to the entry of a judgment, decree or order for relief
against it in an involuntary case or proceeding under any Bankruptcy Law, (C) consents
to the appointment of a custodian of it or for substantially all of its
property, (D) consents to or acquiesces in the institution of a bankruptcy
or an insolvency proceeding against it or (E) makes a general assignment
for the benefit of its creditors;

 

(7)           a
court of competent jurisdiction enters a judgment, decree or order for relief
in respect of the Company or any Restricted Subsidiary which is also a
Significant Subsidiary in an involuntary case or proceeding under any
Bankruptcy Law, which shall (A) approve as properly filed a petition
seeking reorganization, arrangement, adjustment or composition in respect of
the Company or any Significant Subsidiary, (B) appoint a custodian of the
Company or any Significant Subsidiary or for substantially all of its property
or (C) order the winding-up or liquidation of its affairs; and such
judgment, decree or order shall remain unstayed and in effect for a period of
60 consecutive days; or

 

(8)           the
failure of any Guarantee of any Significant Subsidiary of the Company to be in
full force and effect (other than as provided in accordance with the terms of
such Guarantee and this Indenture) or any of the Guarantors denies its
liability under its Guarantee.

 

Section 6.02                               Acceleration.

 

(a)           If an Event of Default of the type
described in Section 6.01(6) or (7) occurs with respect to the
Company and is continuing, then all unpaid principal of, and premium, if any, and
accrued and unpaid interest on all of the outstanding Notes (including any
Additional Notes subsequently issued under this Indenture) will become
immediately due and payable without further action or notice.  If any other Event of Default occurs and is continuing,
then the Trustee or the Holders of at least 25% in principal amount of
outstanding Notes (including any Additional Notes subsequently issued under
this Indenture) may declare the principal of and accrued interest on all the
Notes to be due and payable by notice in writing (the “Acceleration Notice”) to
the Company and the Trustee, which notice must also specify that it is a “notice
of acceleration.”

 

(b)                                 At any time
after a declaration of acceleration with respect to the Notes as described in Section 6.02(a),
the Holders of a majority in principal amount of the Notes (including any
Additional Notes) may rescind and cancel such declaration and its consequences:

 

(1)           if the rescission would not conflict
with any judgment or decree;

 

(2)           if all existing Events of Default
have been cured or waived except nonpayment of principal or interest that has
become due solely because of the acceleration;

 

59

 

(3)           to the extent the payment of such
interest is lawful, interest on overdue installments of interest and overdue
principal, which has become due otherwise than by such declaration of
acceleration, has been paid;

 

(4)           if the Company has paid the Trustee
its compensation and reimbursed the Trustee for its reasonable expenses,
disbursements and advances; or

 

(5)           in the event of the cure or waiver of
an Event of Default of the type described in Section 6.01(6) or (7),
the Trustee shall have received an Officers’ Certificate that such Event of
Default has been cured or waived.

 

No
such rescission shall affect any subsequent Default or impair any right
consequent thereto.

 

Section 6.03                               Other Remedies.  If an Event of Default occurs and is
continuing, the Trustee may pursue any available remedy by proceeding at law or
in equity to collect the payment of principal of, premium, if any, or accrued
and unpaid interest on the Notes or to enforce the performance of any provision
of the Notes or this Indenture.

 

The Trustee may maintain a
proceeding even if it does not possess any of the Notes or does not produce any
of them in the proceeding.  A delay or
omission by the Trustee or any Noteholder 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 to the extent permitted by law.

 

Section 6.04                               Waiver of Past
Defaults.  Subject to
Sections 6.07 and 9.02, the Holders of a majority in aggregate principal amount
of the Notes (including the aggregate principal amount of any Additional Notes
subsequently issued under this Indenture) by notice to the Trustee may waive
any existing Default or Event of Default hereunder and its consequences, except
a Default in the payment of the principal of or interest on any Note as
specified in clauses (1) and (2) of Section 6.01; provided
that a Default or Event of Default due to failure to comply with Section 4.09
shall be deemed to be cured upon filing by the Company (or, if applicable,
Huntsman Corporation) of the reports in compliance with Section 4.09.

 

Section 6.05                               Control by
Majority.  Subject to Section 2.09,
the Holders of a majority in aggregate principal amount of the then outstanding
Notes may direct the time, method and place of conducting any proceeding for
any remedy available to the Trustee or exercising any trust or power conferred
on it, including, without limitation, any remedies provided for in Section 6.03.  Subject to Section 7.01, however, the
Trustee may, in its discretion, refuse to follow any direction that conflicts
with any law or this Indenture, that the Trustee determines may be unduly
prejudicial to the rights of another Holder (it being understood that the
Trustee shall have no duty to ascertain whether or not such actions or
forbearances are unduly prejudicial to such Holders) or that may involve the
Trustee in personal liability; provided, however, that the Trustee may take any
other action deemed proper by the Trustee, in its discretion, that is not inconsistent
with 

 

60

 

such direction.

 

Prior to taking any action
hereunder, the Trustee shall be entitled to indemnification by the Holders
satisfactory to it in its sole discretion against all losses and expenses
caused by taking or not taking such action

 

Section 6.06                               Limitation on
Suits.  A Holder may not pursue any
remedy with respect to this Indenture or the Notes unless:

 

(1)           the
Holder gives to the Trustee notice of a continuing Event of Default;

 

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

 

(3)           such
Holders offer to the Trustee indemnity or security against any loss, liability
or expense to be incurred in compliance with such request which is satisfactory
to the Trustee;

 

(4)           the
Trustee does not comply with the request within 45 days after receipt of the
request and the offer of satisfactory indemnity or security; and

 

(5)           during
such 45-day period the Holders of a majority in aggregate principal amount of
the then outstanding Notes do not give the Trustee a direction which, in the
opinion of the Trustee, is inconsistent with the request.

 

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

 

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

 

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

 

61

 

Section 6.09                               Trustee May File
Proofs of Claim.  The Trustee
may file such proofs of claim and other papers or documents as may be necessary
or advisable in order to have the claims of the Trustee (including any claim
for the reasonable compensation, expenses, taxes, disbursements and advances of
the Trustee, its agents and counsel) and the Holders allowed in any judicial
proceedings relating to the Company or any other obligor upon the Notes, any of
their respective creditors or any of their respective property, and shall be
entitled and empowered to collect and receive any monies or other property
payable or deliverable on any such claims and to distribute the same, and any
custodian in any such judicial proceedings is hereby authorized by each Holder
to make such payments to the Trustee and, in the event that the Trustee shall
consent to the making of such payments directly to the Holders, to pay to the
Trustee any amount due to it for the reasonable compensation, expenses, taxes,
disbursements and advances of the Trustee, its agents and counsel, and any
other amounts due the Trustee under Section 7.07.  The Company’s payment obligations under this Section 6.09
shall be secured in accordance with the provisions of Section 7.07.  Nothing herein contained shall be deemed to
authorize the Trustee to authorize or consent to or accept or adopt on behalf
of any Holder any plan of reorganization, arrangement, adjustment or composition
affecting the Notes or the rights of any Holder thereof, or to authorize the
Trustee to vote in respect of the claim of any Holder in any such proceeding.

 

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

 

First:  to the Trustee, its
agents and attorneys for amounts due under Sections 6.09 and 7.07;

 

Second:  if the Holders are
forced to proceed against the Company directly without the Trustee, to Holders
for their collection costs;

 

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

 

Fourth:  to the Company or any
other obligor on the Notes, as their interests may appear, or as a court of
competent jurisdiction may direct.

 

The Trustee, upon prior
notice to the Company, may fix a record date and payment date for any payment
to Holders pursuant to this Section 6.10.

 

Section 6.11                               Undertaking for
Costs.  In any suit for the
enforcement of any right or remedy under this Indenture or in any suit against
the Trustee for any action taken or omitted by it as Trustee, a court in its
discretion may require the filing by any party litigant in the suit of an
undertaking to pay the costs of the suit, and the court in its discretion may
assess reasonable costs, including reasonable attorneys’ fees, 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 

 

62

 

Section 6.11 does not apply to a suit by the
Trustee, a suit by a Holder pursuant to Section 6.06 or 6.07.

 

Section 6.12                               Expenses and
Services After an Event of Default.  When the Trustee incurs expenses or renders
services after the occurrence of an Event of Default described in this Article VI,
the expenses and compensation for services are intended to constitute expenses
of administration under any bankruptcy law.

 

ARTICLE VII

TRUSTEE

 

Section 7.01                               Duties of
Trustee.

 

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

 

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

 

(1)           The Trustee need perform only those
duties as are specifically set forth in this Indenture or the TIA and no
duties, covenants, responsibilities or obligations shall be implied in this
Indenture that are adverse to the Trustee.

 

(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 (including
Officers’ Certificates) or opinions (including Opinions of Counsel) furnished
to the Trustee and conforming to the requirements of this Indenture.  However, as to any certificates or opinions
which are required by any provision of this Indenture to be delivered or
provided 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 or mathematical
calculations or other facts stated therein or otherwise verify the contents
thereof.

 

(c)                                  Notwithstanding
anything to the contrary herein contained, 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 paragraph does not limit the
effect of paragraph (b) of this Section 7.01.

 

(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.

 

63

 

(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 6.02, 6.04
or 6.05.

 

(d)           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.

 

(e)           Every provision of this
Indenture that in any way relates to the Trustee is subject to paragraphs (a),
(b), (c) and (d) of this Section 7.01.

 

(f)            The Trustee shall not be
liable for interest on any money or assets received by it except as the Trustee
may agree with the Company.  Assets held
in trust by the Trustee need not be segregated from other assets except to the
extent required by law.

 

Section 7.02          Rights of Trustee.  Subject to Section 7.01:

 

(a)           In the absence of bad faith, negligence or willful
misconduct on the part of the Trustee, the Trustee may conclusively rely and
shall be fully protected in acting or refraining from acting upon any document
believed by it to be genuine and to have been signed or presented by the proper
Person.  The Trustee need not investigate
any fact or matter stated in the document.

 

(b)           Before the Trustee acts or refrains from acting, it
may consult with counsel and may require an Officers’ Certificate or an Opinion
of Counsel, which shall conform to Sections 13.04 and 13.05.  The Trustee shall not be liable for and shall
be fully protected in respect of any action it takes or omits to take in good
faith in reliance on such Officers’ Certificate, or an Opinion of Counsel or
advice of counsel.

 

(c)           The Trustee shall not be liable for any action that
it takes or omits to take in good faith that it believes to be authorized or
within its rights or powers.

 

(d)           The Trustee shall not be bound to make any
investigation into the facts or matters stated in any resolution, certificate
(including any Officers’ Certificate), statement, instrument, opinion
(including any Opinion of Counsel), notice, request, direction, consent, order,
bond, debenture, 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, upon reasonable notice to the Company, to
examine the books, records, and premises of the Company, personally or by agent
or attorney.

 

(e)           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 

 

64

 

Holders of the Notes pursuant to the provisions of this Indenture,
unless such Holders shall have offered to the Trustee satisfactory security or
indemnity against the costs, expenses and liabilities which may be incurred by
it in compliance with such request, order or direction.

 

(f)            The Trustee may consult with counsel of its
selection, and the advice or opinion of counsel with respect to legal matters
relating to this Indenture and the Notes shall be full and complete
authorization and protection from liability with respect to any action taken,
omitted or suffered by it hereunder in good faith and in accordance with the
advice or opinion of such counsel.

 

(g)           The Trustee shall not be required to give any bond
or surety in respect of the performance of its powers and duties hereunder.

 

(h)           The permissive rights of the Trustee to do things
enumerated in this Indenture shall not be construed as a duty.

 

(i)            The Trustee may execute any of the trusts or powers
hereunder or perform any duties hereunder either directly or by or through
agents, attorneys or independent contractors and the Trustee will not be
responsible for any misconduct or negligence on the part of any agent, attorney
or independent contractor appointed with due care by it hereunder.

 

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

 

(k)           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.

 

(l)            The Trustee may request that the Company deliver an
incumbency 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 incumbency certificate may be signed by any Person authorized
to sign an incumbency certificate, including any Person 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 Notes and may otherwise deal with
the Company, any Restricted or Unrestricted Subsidiary, or their respective
Affiliates, with the same rights it would have if it were not Trustee.  Any Agent may do the same with like
rights.  However, the 

 

65

 

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 Notes, and it shall not be
accountable for the Company’s use of the proceeds from the Notes, and it shall
not be responsible for any statement of the Company in this Indenture or the
Notes other than the certificate of authentication.

 

Section 7.05           Notice of Default.  If a Default or an Event of Default occurs
and is continuing and if the Trustee has actual knowledge of such Default or
Event of Default, the Trustee shall mail to each Noteholder notice of the
uncured Default or Event of Default on the later of (i) 60 days after such
Default or Event of Default occurs or (ii) 10 days after the Trustee has
actual knowledge of such Default or Event of Default.  Except in the case of a Default or an Event
of Default in the payment of interest or principal of, premium or interest on,
any Note, including an accelerated payment and the failure to make payment on
the Change of Control Payment Date pursuant to a Change of Control Offer or on
a Net Proceeds Offer Payment Date pursuant to a Net Proceeds Offer and, except
in the case of a failure to comply with Article Five, the Trustee may
withhold the notice if and so long as its Responsible Officer(s) in good
faith determines that withholding the notice is in the interest of the
Holders.  The Trustee shall not be deemed
to have knowledge of a Default or Event of Default other than (i) any
Event of Default occurring pursuant to Sections 6.01(1) or 6.01(2); or (ii) any
Default or Event of Default of which a Trust Officer shall have received written
notification or obtained actual knowledge. 
As used herein, the term “actual knowledge” means the actual fact or
statement of knowing, without any duty to make any investigation with regard
thereto.

 

Section 7.06           Reports by Trustee to Holders.  Within 60 days after April 15 of each
year beginning with April 15, 2010, the Trustee shall, to the extent that
any of the events described in TIA § 313(a) occurred within the previous
twelve months, but not otherwise, mail to each Noteholder a brief report dated
as of such date that complies with TIA § 313(a).  The Trustee also shall comply with TIA § 313(b) and
313(c).

 

A copy of each report at the
time of its mailing to Holders shall be mailed to the Company and filed with
the SEC and each stock exchange, if any, on which the Notes are listed.

 

The Company shall promptly
notify the Trustee if the Notes become listed on any stock exchange, and if the
Notes are so listed, the Trustee shall comply with TIA § 313(d).

 

Section 7.07           Compensation and Indemnity.  The Company shall pay to the Trustee from
time to time, and the Trustee shall be entitled to, such compensation as may be
agreed upon by the Company and the Trustee. 
The Trustee’s compensation shall not be limited by any law on
compensation of a trustee of an express trust. 
The Company shall reimburse the Trustee promptly upon request for all
reasonable out-of-pocket expenses, disbursements and advances incurred or made
by it in connection with the performance of its duties and the discharge of its
obligations under this Indenture.  Such
expenses shall include the reasonable fees and expenses of the Trustee’s agents
and counsel.

 

66

 

The Company shall indemnify
the Trustee and its agents, employees, officers, stockholders and directors
for, and hold them harmless against, any loss, liability or expense including
taxes (other than taxes based on the income of the Trustee) and reasonable
attorneys’ fees and expenses incurred by them except for such actions to the
extent caused by any negligence, bad faith or willful misconduct on their part,
arising out of or in connection with the acceptance or administration of this
trust including the reasonable costs and expenses of defending themselves
against or investigating any claim (whether asserted by the Company, and Holder
or any other Person) or liability in connection with the exercise or
performance of any of the Trustee’s rights, powers or duties hereunder.  The Trustee shall notify the Company promptly
of any claim asserted against the Trustee or any of its agents, employees,
officers, stockholders and directors for which it may seek indemnity.  Failure by the Company to so notify the
Trustee shall not relieve the Company of its obligations hereunder.  The Company shall defend the claim and the
Trustee shall cooperate in the defense at the Company’s expense.  The Trustee and its agents, employees,
officers, stockholders and directors subject to the claim may have separate
counsel and the Company shall pay the reasonable fees and expenses of such
counsel; provided, however, that the Company will not be required
to pay such fees and expenses if it assumes the Trustee’s defense and there is
no conflict of interest between the Company and the Trustee and its agents,
employees, officers, stockholders and directors subject to the claim in
connection with such defense as reasonably determined by the Trustee; provided,
further, that, unless the Company otherwise agrees in writing, the
Company shall not be liable to pay the fees and expenses of more than one
counsel at any given time located within one particular jurisdiction.  The Company need not pay for any settlement
made without its written consent which consent shall not be unreasonably
withheld.  The Company need not reimburse
any expense or indemnify against any loss or liability to the extent incurred
by the Trustee through its negligence, bad faith or willful misconduct.

 

To secure the Company’s
payment obligations in this Section 7.07, the Trustee shall have a lien
prior to the Notes on all assets or money held or collected by the Trustee, in
its capacity as Trustee, except assets or money held in trust to pay principal
of or interest on particular Notes.

 

When the Trustee incurs
expenses or renders services after an Event of Default specified in Section 6.01(6) or
(7) occurs, such expenses (including the reasonable charges and expenses
of its counsel) and the compensation for such services are intended to
constitute expenses of administration and shall be paid to the extent allowed
under any Bankruptcy Law.

 

The provisions of this Section shall
survive the termination of this Indenture, any rejection or termination of this
Indenture under any Bankruptcy Law or the resignation or removal of the
Trustee.

 

Section 7.08           Replacement of Trustee.  The Trustee may resign by so notifying the
Company in writing at least 30 days in advance. 
The Holders of a majority in principal amount of the outstanding Notes
may remove the Trustee by so notifying the Company and the Trustee and may
appoint a successor Trustee with the Company’s consent.  A resignation or removal of the Trustee and
appointment of a successor Trustee shall become effective only with the
successor Trustee’s acceptance of appointment as provided in this Section.  The Company may 

 

67

 

remove the Trustee if:

 

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

 

(2)           the Trustee is adjudged bankrupt or insolvent or an
order for relief is entered with respect to the Trustee under any Bankruptcy Law;

 

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

 

(4)           the Trustee 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 notify each Holder of such event and shall promptly appoint a
successor Trustee.  Within one year after
the successor Trustee takes office, the Holders of a majority in principal
amount of the Notes may appoint a successor Trustee to replace the successor
Trustee appointed by the Company.

 

A successor Trustee shall
deliver a written acceptance of its appointment to the retiring Trustee and to
the Company.  Promptly after that, the
retiring Trustee shall transfer all property held by it as Trustee to the successor
Trustee, subject to the lien provided in Section 7.07, 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.  A successor Trustee shall
mail notice of its succession to each Holder.

 

If a successor Trustee does
not take office within 60 days after the retiring Trustee resigns or is
removed, the retiring Trustee, the Company or the Holders of at least 10% in
aggregate principal amount of the outstanding Notes may petition any court of
competent jurisdiction for the appointment of a successor Trustee.

 

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

 

Notwithstanding replacement
of the Trustee pursuant to this Section 7.08, the Company’s obligations
under Section 7.07 shall continue for the benefit of the retiring Trustee.

 

Section 7.09           Successor Trustee by Merger, Etc.  If the Trustee consolidates with, merges or
converts into, or transfers all or substantially all of its corporate trust
business to, another corporation, the resulting, surviving or transferee
corporation without any further act shall, if such resulting, surviving or
transferee corporation is otherwise eligible hereunder, be the successor
Trustee; provided, however, that such corporation shall be
otherwise qualified and eligible under this Article Seven.

 

Section 7.10           Eligibility; Disqualification.  This Indenture shall always have a Trustee
who satisfies the requirement of TIA §§ 310(a)(1) and 310(a)(2).  The Trustee (or in the case of a 

 

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corporation included in a bank holding company
system, the related bank holding company) shall have a combined capital and surplus
of at least $100,000,000 as set forth in its most recent published annual
report of condition.  In addition, if the
Trustee is a corporation included in a bank holding company system, the
Trustee, independently of such bank holding company, shall meet the capital
requirements of TIA § 310(a)(2). 
The Trustee shall comply with TIA § 310(b); provided, however,
that there shall be excluded from the operation of TIA § 310(b)(1) any
indenture or indentures under which other notes, or certificates of interest or
participation in other notes, of the Company are outstanding, if the
requirements for such exclusion set forth in TIA § 310(b)(1) are
met.  The provisions of TIA § 310
shall apply to the Company and any other obligor of the Notes.

 

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

 

ARTICLE VIII

DISCHARGE OF INDENTURE; DEFEASANCE

 

Section 8.01           Termination of the Company’s Obligations.  This Indenture will be Discharged and will
cease to be of further effect and the obligations of the Company and the
Guarantors under the Notes and the Guarantees and this Indenture shall
terminate (except that the obligations under Sections 2.03 through 2.07, 7.01,
7.02, 7.07 and 7.08 and the rights, powers, trusts, duties and immunities of
the Trustee hereunder shall survive the effect of this Article Eight) when
(a) either (i) all existing Notes theretofore authenticated and
delivered (except lost, stolen or destroyed Notes which have been replaced or
paid and Notes for whose payment money has theretofore been deposited in trust
or segregated and held in trust by the Company and thereafter repaid to the
Company or discharged from such trust) have been delivered to the Trustee for
cancellation or (ii) all Notes not theretofore delivered to the Trustee
for cancellation have become due and payable or will become due and payable
within one year (including by way of irrevocable instructions delivered by the
Company to the Trustee to effect the redemption of the Notes), and the Company
has irrevocably deposited or caused to be deposited with the Trustee as trust
funds in trust solely for the benefit of the Holders of such Notes, cash in
U.S. dollars, U.S. Government Obligations or a combination thereof, in amounts
as will be sufficient without consideration of any reinvestment of interest to
pay and discharge the entire Indebtedness on the Notes not theretofore
delivered to the Trustee for cancellation, for principal of, premium, if any,
and interest on the Notes to the date of deposit together with irrevocable
instructions from the Company directing the Trustee to apply such Funds to the
payment thereof at maturity or redemption, as the case may be; (b) the
Company has paid all other sums payable under this Indenture by the Company
with respect to the Notes; and (c) the Company has delivered to the
Trustee an Officers’ Certificate and an Opinion of Counsel stating that all conditions
precedent under this Indenture relating to the satisfaction and discharge of
this Indenture with respect to the Notes have been complied with.  All funds that remain unclaimed 

 

69

 

for one year will be paid to the Company and
thereafter Holders must look to the Company for payment as general creditors.

 

In addition, at the Company’s
option, either (a) the Company shall be deemed to have been Discharged
from any and all obligations with respect to the Notes and the Guarantees (“Legal
Defeasance”) after the applicable conditions set forth below have been
satisfied (except for the obligations of the Company under Sections 2.03, 2.04,
2.06, 2.07, 7.01, 7.02, 7.07 and this Section 8.01) or (b) the
Company and its Restricted Subsidiaries shall cease to be under any obligation
to comply with any term, provision or condition set forth in Sections 4.03,
4.09 and 4.11 through 4.20 and Section 5.01 and thereafter any omission to
comply with such obligations shall not constitute a Default or Event of Default
with respect to the Notes (“Covenant Defeasance”) after the applicable
conditions set forth below have been satisfied:

 

(1)           the Company must irrevocably deposit with the
Trustee in trust, for the benefit of the Holders cash in U.S. Dollars or
non-callable U.S. government obligations, in such amounts as will be
sufficient, in the opinion of a nationally recognized firm of independent
public accountants, to pay the principal of, premium, if any, and interest on the
Notes on the stated date for payment thereof or on an applicable redemption
date;

 

(2)           in the case of Legal Defeasance, the Company shall
have delivered to the Trustee an Opinion of Counsel in the United States of
America reasonably acceptable to the Trustee confirming that

 

(i)    the Company has received from, or there has been
published by, the Internal Revenue Service a ruling, or

 

(ii)   since the Issue Date, there has been a change in the
applicable United States federal income tax law,

 

in either case, to the effect that, and based
thereon such Opinion of Counsel shall confirm that, the Holders of the
outstanding Notes will not recognize income, gain or loss for United States
federal income tax purposes as a result of such Legal Defeasance and will be subject
to United States federal income tax on the same amounts, in the same manner and
at the same times as would have been the case if such Legal Defeasance had not
occurred; provided, however, such Opinion of Counsel shall not be required if
all the Notes will become due and payable on the Maturity Date within one year
or are to be called for redemption within one year under arrangements
satisfactory to the Trustee;

 

(3)           in the case of Covenant Defeasance, the Company
shall have delivered to the Trustee an Opinion of Counsel in the United States
of America reasonably acceptable to the Trustee confirming that the Holders of
the outstanding Notes will not recognize income, gain or loss for United States
federal income tax purposes as a result of such Covenant Defeasance and will be
subject to United States federal income tax on the same amounts, in the same
manner and at the same times as would have been 

 

70

 

the case if such Covenant Defeasance had not occurred;

 

(4)           no Event of Default or Default shall have occurred
and be continuing on the date of such deposit (other than any Default arising
from the substantially contemporaneous incurrence of Indebtedness to fund the
deposit described above in clause (1));

 

(5)           such Legal Defeasance or Covenant Defeasance shall
not result in a breach or violation of, or constitute a default under this
Indenture (other than any Default arising from the substantially
contemporaneous incurrence of Indebtedness to fund the deposit described above
in clause (1)) or any other material agreement or instrument to which the
Company or any of its Subsidiaries is a party or by which the Company or any of
its Subsidiaries is bound;

 

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

 

(7)           the Company shall have delivered to the Trustee an
Officers’ Certificate and an Opinion of Counsel, each stating that all
conditions precedent provided for or relating to the Legal Defeasance or the
Covenant Defeasance have been complied with; and

 

(8)           the Company shall have delivered to the Trustee an
Opinion of Counsel, to the effect that either (i) the Company has assigned
all its ownership interest in the trust funds to the Trustee or (ii) the
Trustee has a valid perfected security interest in the trust funds.

 

Section 8.02           Acknowledgment of Discharge by Trustee.  Subject to Section 8.05, after (i) the
conditions of Section 8.01, have been satisfied and (ii) the Company
has delivered to the Trustee an Opinion of Counsel, stating that all conditions
precedent referred to in clause (i) above relating to the satisfaction and
discharge of this Indenture have been complied with, the Trustee upon written
request of the Company shall acknowledge in writing the discharge of the Company’s
obligations under this Indenture except for those surviving obligations
specified in this Article Eight.

 

Section 8.03           Application of Trust Money.  The Trustee shall hold in trust Funds
deposited with it pursuant to Section 8.01.  It shall apply the Funds through the Paying
Agent and in accordance with this Indenture to the payment of all the principal
of, or premium, if any, and interest on the Notes.

 

Section 8.04           Repayment to the Company.  The Trustee and the Paying Agent shall
promptly pay to the Company any Funds held by them for the payment of all the
principal of, or 

 

71

 

premium, if any, and interest that remains unclaimed
for one year; provided, however, that the Trustee or such Paying
Agent may, at the expense of the Company, cause to be published once in a
newspaper of general circulation in the City of New York or mailed to each
Holder, notice that such Funds remain unclaimed and that, after a date
specified therein, which shall not be less than 30 days from the date of such
publication or mailing, any unclaimed balance of such Funds then remaining will
be repaid to the Company.  After payment
to the Company, Holders entitled to the Funds must look to the Company for
payment as general unsecured creditors unless an applicable abandoned property
law designates another Person and all liability of the Trustee and Paying Agent
with respect to such Funds shall cease.

 

Section 8.05           Reinstatement.  If the Trustee or Paying Agent is unable to
apply any Funds by reason of any legal proceeding or by reason of any order or
judgment of any court or governmental authority enjoining, restraining or
otherwise prohibiting such application, the Company’s obligations under this
Indenture and the Notes shall be revived and reinstated as though no deposit
had occurred pursuant to Section 8.01 until such time as the Trustee or
Paying Agent is permitted to apply all such Funds in accordance with Section 8.01;
provided, however, that if the Company has made any payment of
principal, or premium, if any, and interest on any Notes because of the
reinstatement of its obligations, the Company shall be subrogated to the rights
of the Holders of such Notes to receive such payment from Funds held by the
Trustee or Paying Agent.

 

ARTICLE IX

AMENDMENTS, SUPPLEMENTS AND WAIVERS

 

Section 9.01           Without Consent of Holders.  The Company, when authorized by a Board
Resolution, the Guarantors and the Trustee, together, may amend or supplement
this Indenture, the Notes or the Guarantees without the consent of any Holders
to:

 

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

 

(2)           provide for the assumption of the Company’s
obligations to Holders of Notes in the case of a merger or consolidation or
sale of all or substantially all of the Company’s assets;

 

(3)           provide for uncertificated Notes in addition to or
in place of certificated Notes;

 

(4)           to add any person as a Guarantor of the Notes or
secure the Notes or the Guarantees;

 

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

 

(6)           to make any change that would provide any additional
benefit or rights to the Holders or that does not adversely affect in any
material respect the legal 

 

72

 

rights of any Noteholders hereunder; provided that the Company
has delivered to the Trustee an Opinion of Counsel and an Officers’
Certificate, each stating that such amendment or supplement complies with the
provisions of this Section 9.01.

 

Section 9.02           With Consent of Holders.  Subject to Section 6.07, the Company,
when authorized by a Board Resolution, the Guarantors and the Trustee,
together, with the written consent (including any electronic communication
thereof by a Depositary) of the Holder or Holders of at least a majority in
principal amount of the then outstanding Notes (including the aggregate
principal amount of any Additional Notes subsequently issued under this
Indenture) may make all other modifications, waivers and amendments of this
Indenture, the Notes or the Guarantees, except that, without the consent of
each Holder of Notes affected thereby, no amendment and waiver may, directly or
indirectly:

 

(1)           reduce the amount of Notes whose Holders must
consent to an amendment;

 

(2)           reduce the rate of or change the time for payment of
interest, including defaulted interest, on any Notes;

 

(3)           reduce the principal of or change the fixed maturity
of any Notes, or change the date on which any Notes may be subject to redemption
or repurchase, or reduce the redemption or repurchase price thereof for the
Notes;

 

(4)           make any Notes payable in money other than that
stated in the Notes and this Indenture;

 

(5)           make any change in provisions of this Indenture or
the Notes relating to the rights of Holders of Notes to receive payment of
principal of and interest on such Notes on or after the due date thereof or to
bring suit to enforce such payment or permitting Holders of a majority in
principal amount of the Notes to waive Defaults or Events of Default;

 

(6)           after a Change of Control has occurred, amend,
change or modify any provision of this Indenture that would amend, change or
modify in any material respect the obligation of the Company to make and
complete a Change of Control Offer with respect to such Change of Control or,
after an Asset Sale has occurred, amend, change or modify in any material
respect the obligation of the Company to make and complete a Net Proceeds Offer
with respect to such Asset Sale; or

 

(7)           release any Guarantor from any of its obligations
under its Guarantee or this Indenture otherwise than in accordance with the
terms of this Indenture.

 

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, supplement or waiver, but it shall
be sufficient if such consent approves the substance thereof.

 

73

 

After an amendment,
supplement or waiver under this Section 9.02 becomes effective (as
provided in Section 9.04), the Company shall mail to the Holders affected
thereby a notice briefly describing the amendment, supplement or waiver.  Any failure of the Company to mail such
notice, or any defect therein, shall not, however, in any way impair or affect
the validity of any such supplemental indenture.

 

Section 9.03           Compliance with TIA.  Every amendment, waiver or supplement of this
Indenture or the Notes shall comply with the TIA as then in effect.

 

Section 9.04           Revocation and Effect of Consents.  Until an amendment, waiver or supplement
becomes effective, a consent to it by a Holder is a continuing consent by the
Holder and every subsequent Holder of a Note or portion of a Note that
evidences the same debt as the consenting Holder’s Note, even if notation of
the consent is not made on any Note. 
Subject to the following paragraph, any such Holder or subsequent Holder
may revoke the consent as to his Note or portion of his Note by notice to the
Trustee or the Company received before the date on which the Trustee receives
an Officers’ Certificate certifying that the Holders of the requisite principal
amount of Notes have consented (and not theretofore revoked such consent) to
the amendment, supplement or waiver (at which time such amendment, supplement
or waiver shall become effective).

 

The Company may, but shall
not be obligated to, fix such record date as it may select for the purpose of
determining the Holders entitled to consent to any amendment, supplement or
waiver.  If a record date is fixed, then
notwithstanding the last sentence of the immediately preceding paragraph, those
Persons who were Holders at such record date (or their duly designated proxies),
and only those Persons, shall be entitled to revoke any consent previously
given, whether or not such Persons continue to be Holders after such record
date.  No such consent shall be valid or
effective for more than 120 days after such record date.

 

After an amendment,
supplement or waiver becomes effective, it shall bind every Holder, unless it
makes a change described in any of clauses (1) through (8) of Section 9.02,
in which case, the amendment, supplement or waiver shall bind only each Holder
of a Note who has consented to it and every subsequent Holder of a Note or
portion of a Note that evidences the same debt as a consenting Holder’s Note; provided,
however, that any such waiver shall not impair or affect the right of
any Holder to receive payment of principal of and interest on a Note, on or
after the respective due dates expressed in such Note, or to bring suit for the
enforcement of any such payment on or after such respective dates without the
consent of such Holder.

 

Section 9.05           Notation on or Exchange of Notes.  If an amendment, supplement or waiver changes
the terms of a Note, the Trustee may require the Holder of the Note to deliver
it to the Trustee.  The Trustee may place
an appropriate notation on the Note about the changed terms and return it to
the Holder.  Alternatively, if the
Company or the Trustee so determines, the Company in exchange for the Note
shall issue and the Trustee shall authenticate a new Note that reflects the
changed terms.

 

Section 9.06           Trustee To Sign Amendments, Etc.  The Trustee shall execute any 

 

74

 

amendment, supplement or waiver authorized pursuant
to and adopted in accordance with this Article Nine; provided, however,
that the Trustee may, but shall not be obligated to, execute any such
amendment, supplement or waiver which affects the Trustee’s own rights, duties
or immunities under this Indenture.  The
Trustee shall be entitled to receive, and shall be fully protected in relying
upon, an Opinion of Counsel and an Officers’ Certificate each stating that the
execution of any amendment, supplement or waiver authorized pursuant to this Article Nine
is authorized or permitted by this Indenture. 
Such Opinion of Counsel shall not be an expense of the Trustee.

 

ARTICLE X

[RESERVED]

 

ARTICLE XI

GUARANTEE OF NOTES

 

Section 11.01         Unconditional Guarantee.  Subject to the provisions of this Article Eleven,
each of the Guarantors hereby, jointly and severally, unconditionally and
irrevocably guarantees (such guarantees to be referred to herein as the “Guarantee”)
to each Holder of a Note (including any Additional Notes upon issuance in
accordance with Section 2.18) authenticated and delivered by the Trustee
and to the Trustee and its successors and assigns, irrespective of the validity
and enforceability of this Indenture, the Notes or the obligations of the Company
or any other Guarantors to the Holders or the Trustee hereunder or thereunder,
that: (a) the principal of, premium, if any, and interest on the Notes
(and any Additional Interest payable thereon) shall be duly and punctually paid
in full when due, whether at maturity, upon redemption at the option of Holders
pursuant to the provisions of the Notes relating thereto, by acceleration or
otherwise, and interest on the overdue principal and (to the extent permitted
by law) interest, if any, on the Notes and all other obligations of the Company
or the Guarantors to the Holders or the Trustee hereunder or thereunder
(including amounts due the Trustee under Section 7.07 hereof) and all
other obligations shall be promptly paid in full or performed, all in accordance
with the terms hereof and thereof; and (b) in case of any extension of
time of payment or renewal of any Notes or any of such other obligations, the
same shall be promptly paid in full when due or performed in accordance with
the terms of the extension or renewal, whether at maturity, by acceleration or
otherwise.  Failing payment when due of
any amount so guaranteed, or failing performance of any other obligation of the
Company to the Holders under this Indenture or under the Notes, for whatever
reason, each Guarantor shall be obligated to pay, or to perform or cause the
performance of, the same immediately.  An
Event of Default under this Indenture or the Notes shall constitute an event of
default under this Guarantee, and shall entitle the Holders of Notes to
accelerate the obligations of the Guarantors hereunder in the same manner and
to the same extent as the obligations of the Company.

 

Each of the Guarantors
hereby agrees that its obligations hereunder shall be unconditional,
irrespective of the validity, regularity or enforceability of the Notes or this
Indenture, the absence of any action to enforce the same, any waiver or consent
by any Holder of the Notes with respect to any provisions hereof or thereof,
any release of any other Guarantor, the recovery of any judgment against the
Company, any action to enforce the same, whether or

 

75

 

not a Guarantee is affixed
to any particular Note, or any other circumstance which might otherwise
constitute a legal or equitable discharge or defense of a Guarantor.  Each of the Guarantors hereby waives the
benefit of diligence, presentment, demand of payment, filing of claims with a
court in the event of insolvency or bankruptcy of the Company, any right to
require a proceeding first against the Company, protest, notice and all demands
whatsoever and covenants that its Guarantee shall not be discharged except by
complete performance of the obligations contained in the Notes, this Indenture
and this Guarantee.  This Guarantee is a
guarantee of payment and not of collection. 
If any Holder or the Trustee is required by any court or otherwise to
return to the Company or to any Guarantor, or any custodian, trustee,
liquidator or other similar official acting in relation to the Company or such
Guarantor, any amount paid by the Company or such Guarantor to the Trustee or
such Holder, this Guarantee, to the extent theretofore discharged, shall be
reinstated in full force and effect. 
Each Guarantor further agrees that, as between it, on the one hand, and
the Holders of Notes and the Trustee, on the other hand, (a) subject to
this Article Eleven, the maturity of the obligations guaranteed hereby may
be accelerated as provided in Article Six hereof for the purposes of this
Guarantee, notwithstanding any stay, injunction or other prohibition preventing
such acceleration in respect of the obligations guaranteed hereby, and (b) in
the event of any acceleration of such obligations as provided in Article Six
hereof, such obligations (whether or not due and payable) shall forthwith
become due and payable by the Guarantors for the purpose of this Guarantee.

 

No stockholder, officer,
director, employee or incorporator, past, present or future, or any Guarantor,
as such, shall have any personal liability under this Guarantee by reason of
his, her or its status as such stockholder, officer, director, employee or
incorporator.

 

Each Guarantor that makes a
payment or distribution under its Guarantee shall be entitled to a contribution
from each other Guarantor in an amount pro rata, based on the net assets of
each Guarantor, determined in accordance with GAAP.

 

Section 11.02         Limitations on Guarantees.  The obligations of each Guarantor under its
Guarantee are limited to the maximum amount which, after giving effect to all
other contingent and fixed liabilities of such Guarantor and after giving
effect to any collections from or payments made by or on behalf of any other
Guarantor in respect of the obligations of such other Guarantor under its
Guarantee or pursuant to its contribution obligations under this Indenture,
will result in the obligations of such Guarantor under the Guarantee not
constituting a fraudulent conveyance or fraudulent transfer under applicable
law.

 

Section 11.03         Execution and Delivery of Guarantee.  To further evidence the Guarantee set forth
in Section 11.01, each Guarantor hereby agrees that a notation of such
Guarantee, substantially in the form of Exhibit E hereto, shall be
endorsed on each Note authenticated and delivered by the Trustee.  Such Guarantee shall be executed on behalf of
each Guarantor by either manual or facsimile signature of a duly authorized
Officer of each Guarantor.  The validity
and enforceability of any Guarantee shall not be affected by the fact that it
is not affixed to any particular Note.

 

Each of the Guarantors
hereby agrees that its Guarantee set forth in Section 11.01 shall 

 

76

 

remain in full force and
effect notwithstanding any failure to endorse on each Note a notation of such
Guarantee.

 

If an Officer of a Guarantor
whose signature is on this Indenture or a Guarantee no longer holds that office
at the time the Trustee authenticates the Note on which such Guarantee is
endorsed or at any time thereafter, such Guarantor’s Guarantee of such Note
shall be valid nevertheless.

 

The delivery of any Note by
the Trustee, after the authentication thereof hereunder, shall constitute due
delivery of any Guarantee set forth in this Indenture on behalf of each
Guarantor.

 

Section 11.04        Release of a Guarantor.

 

(a)           If no Default
or Event of Default exists and is continuing, the obligations of any Guarantor
under its Guarantee of the Notes will be automatically and unconditionally
released and discharged when any of the following occurs:

 

(1)           a sale, exchange, transfer
or other disposition (including, without limitation, by way of merger, consolidation
or otherwise), directly or indirectly, of all of the Capital Stock of such
Guarantor to any Person that is not a Restricted Subsidiary of the Company;
provided that such sale, exchange, transfer or other disposition is made in
accordance with the provisions of this Indenture;

 

(2)           a sale, exchange, transfer
or other disposition (including, without limitation, by way of merger,
consolidation or otherwise), directly or indirectly, of Capital Stock of such
Guarantor to any Person that is not a Restricted Subsidiary of the Company, or
an issuance by such Guarantor of its Capital Stock, in each case as a result of
which such Guarantor ceases to be a majority-owned Subsidiary of the Company;
provided that such transaction is made in accordance with the provisions of
this Indenture;

 

(3)           such Guarantor is
unconditionally released and discharged from its liability with respect to
Indebtedness in connection with which such Guarantee was executed pursuant to
clause (1) of the covenant described under the Section 4.19 hereof;

 

(4)           the designation of such
Guarantor as an Unrestricted Subsidiary in accordance with the provisions of
this Indenture; or

 

(5)           the occurrence of Legal
Defeasance or Covenant Defeasance in accordance with this Indenture.

 

(b)           In connection
with any transaction set forth Section 11.04(a) above, the Trustee
shall receive an Officers’ Certificate and an Opinion of Counsel certifying as
to the compliance with this Section 11.04; provided, however,
that the legal counsel delivering such Opinion of Counsel may rely as to
matters of fact on one or more Officers’ Certificates of the 

 

77

 

Company.

 

The Trustee shall execute
any documents reasonably requested by the Company or a Guarantor in order to evidence
the release of such Guarantor from its obligations under its Guarantee endorsed
on the Notes and under this Article Eleven.

 

Section 11.05         Waiver of Subrogation.  Until this Indenture is discharged and all of
the Notes are discharged and paid in full, each Guarantor hereby irrevocably
waives and agrees not to exercise any claim or other rights which it may now or
hereafter acquire against the Company that arise from the existence, payment,
performance or enforcement of the Company’s obligations under the Notes or this
Indenture and such Guarantor’s obligations under this Guarantee and this
Indenture, in any such instance including, without limitation, any right of
subrogation, reimbursement, exoneration, contribution, indemnification, and any
right to participate in any claim or remedy of the Holders against the Company,
whether or not such claim, remedy or right arises in equity, or under contract,
statute or common law, including, without limitation, the right to take or
receive from the Company, directly or indirectly, in cash or other property or
by set-off or in any other manner, payment or security on account of such claim
or other rights.  If any amount shall be
paid to any Guarantor in violation of the preceding sentence and any amounts
owing to the Trustee or the Holders of Notes under the Notes, this Indenture,
or any other document or instrument delivered under or in connection with such
agreements or instruments, shall not have been paid in full, such amount shall
have been deemed to have been paid to such Guarantor for the benefit of, and
held in trust for the benefit of, the Trustee or the Holders and shall
forthwith be paid to the Trustee for the benefit of itself or such Holders to
be credited and applied to the obligations in favor of the Trustee or the
Holders, as the case may be, whether matured or unmatured, in accordance with
the terms of this Indenture.  Each
Guarantor acknowledges that it will receive direct and indirect benefits from
the financing arrangements contemplated by this Indenture and that the waiver
set forth in this Section 11.05 is knowingly made in contemplation of such
benefits.

 

Section 11.06         Immediate Payment.  Each Guarantor agrees to make immediate
payment to the Trustee on behalf of the Holders of all Obligations owing or
payable to the respective Holders upon receipt of a demand for payment therefor
by the Trustee to such Guarantor in writing.

 

Section 11.07         No Set-Off.  Each payment to be made by a Guarantor
hereunder in respect of the Obligations shall be payable in the currency or
currencies in which such Obligations are denominated, and shall be made without
set-off, defense, counterclaim, reduction or diminution of any kind or nature.

 

Section 11.08         Obligations Absolute.  The obligations of each Guarantor hereunder
are and shall be absolute and unconditional and any monies or amounts expressed
to be owing or payable by each Guarantor hereunder which may not be recoverable
from such Guarantor on the basis of a Guarantee shall be recoverable from such
Guarantor as a primary obligor and principal debtor in respect thereof.

 

78

 

Section 11.09        Obligations Continuing.  The obligations of each Guarantor hereunder
shall be continuing and shall remain in full force and effect until all the
obligations have been paid and satisfied in full.

 

Section 11.10        Obligations Not Reduced.  The obligations of each Guarantor hereunder
shall not be satisfied, reduced or discharged solely by the payment of such
principal, premium, if any, interest, fees and other monies or amounts as may
at any time prior to discharge of this Indenture pursuant to Article Eight
be or become owing or payable under or by virtue of or otherwise in connection
with the Notes or this Indenture.

 

Section 11.11        Obligations Reinstated.  The obligations of each Guarantor hereunder
shall continue to be effective or shall be reinstated, as the case may be, if
at any time any payment which would otherwise have reduced the obligations of
any Guarantor hereunder (whether such payment shall have been made by or on
behalf of the Company or by or on behalf of a Guarantor) is rescinded or
reclaimed from any of the Holders upon the insolvency, bankruptcy, liquidation
or reorganization of the Company or any Guarantor or otherwise, all as though
such payment had not been made.  If
demand for, or acceleration of the time for, payment by the Company is stayed
upon the insolvency, bankruptcy, liquidation or reorganization of the Company,
all such Indebtedness otherwise subject to demand for payment or acceleration
shall nonetheless be payable by each Guarantor as provided herein.

 

Section 11.12        Obligations Not Affected.  The obligations of each Guarantor hereunder
shall not be affected, impaired or diminished in any way by any act, omission,
matter or thing whatsoever, occurring before, upon or after any demand for
payment hereunder (and whether or not known or consented to by any Guarantor or
any of the Holders) which, but for this provision, might constitute a whole or
partial defense to a claim against any Guarantor hereunder or might operate to
release or otherwise exonerate any Guarantor from any of its obligations
hereunder or otherwise affect such obligations, whether occasioned by default
of any of the Holders or otherwise, including, without limitation:

 

(a)           any limitation of status or
power, disability, incapacity or other circumstance relating to the Company or
any other Person, including any insolvency, bankruptcy, liquidation,
reorganization, readjustment, composition, dissolution, winding-up or other
proceeding involving or affecting the Company or any other Person;

 

(b)           any irregularity, defect,
unenforceability or invalidity in respect of any indebtedness or other
obligation of the Company or any other Person under this Indenture, the Notes
or any other document or instrument;

 

(c)           any failure of the Company,
whether or not without fault on its part, to perform or comply with any of the
provisions of this Indenture or the Notes, or to give notice thereof to a
Guarantor;

 

(d)           the taking or enforcing or
exercising or the refusal or neglect to take or enforce or exercise any right
or remedy from or against the Company or any other Person 

 

79

 

or their respective assets or the release or discharge of any such
right or remedy;

 

(e)           the granting of time,
renewals, extensions, compromises, concessions, waivers, releases, discharges
and other indulgences to the Company or any other Person;

 

(f)            any change in the time,
manner or place of payment of, or in any other term of, any of the Notes, or
any other amendment, variation, supplement, replacement or waiver of, or any
consent to departure from, any of the Notes or this Indenture, including,
without limitation, any increase or decrease in the principal amount of or
premium, if any, or interest on any of the Notes;

 

(g)           any change in the ownership,
control, name, objects, businesses, assets, capital structure or constitution
of the Company or a Guarantor;

 

(h)           any merger or amalgamation
of the Company or a Guarantor with any Person or Persons;

 

(i)            the occurrence of any change
in the laws, rules, regulations or ordinances of any jurisdiction by any
present or future action of any governmental authority or court amending,
varying, reducing or otherwise affecting, or purporting to amend, vary, reduce
or otherwise affect, any of the Obligations or the obligations of a Guarantor
under its Guarantee; and

 

(j)            any other circumstance,
(other than release of the Guarantor pursuant to Section 11.04 and other
than by complete, irrevocable payment) that might otherwise constitute a legal
or equitable discharge or defense of the Company under this Indenture or the
Notes or of a Guarantor in respect of its Guarantee hereunder.

 

Section 11.13        Waiver.  Without in any way limiting the provisions of
Section 11.01 hereof, each Guarantor hereby waives notice of acceptance
hereof, notice of any liability of any Guarantor hereunder, notice or proof of
reliance by the Holders upon the obligations of any Guarantor hereunder, and
diligence, presentment, demand for payment on the Company, protest, notice of
dishonor or non-payment of any of the Obligations, or other notice or
formalities to the Company or any Guarantor of any kind whatsoever.

 

Section 11.14        No Obligation To Take Action
Against the Company.  Neither the
Trustee nor any other Person shall have any obligation to enforce or exhaust
any rights or remedies or to take any other steps under any security for the
Obligations or against the Company or any other Person or any property of the
Company or any other Person before the Trustee is entitled to demand payment
and performance by any or all Guarantors of their liabilities and obligations
under their Guarantees or under this Indenture.

 

Section 11.15        Dealing with the Company and
Others.  The Holders, without
releasing, discharging, limiting or otherwise affecting in whole or in part the
obligations and liabilities of any Guarantor hereunder and without the consent
of or notice to any Guarantor, may

 

80

 

(a)           grant time, renewals, extensions, compromises,
concessions, waivers, releases, discharges and other indulgences to the Company
or any other Person;

 

(b)           take or abstain from taking security or collateral
from the Company or from perfecting security or collateral of the Company;

 

(c)           accept compromises or arrangements from the Company;

 

(d)           apply all monies at any time received from the
Company or from any security upon such part of the Obligations as the Holders may
see fit or change any such application in whole or in part from time to time as
the Holders may see fit; and

 

(e)           otherwise deal with, or waive or modify their right
to deal with, the Company and all other Persons and any security as the Holders
or the Trustee may see fit.

 

Section 11.16        Default and Enforcement.  If any Guarantor fails to pay in accordance
with Section 11.06 hereof, the Trustee may proceed in its name as trustee
hereunder in the enforcement of the Guarantee of any such Guarantor and such
Guarantor’s obligations thereunder and hereunder by any remedy provided by law,
whether by legal proceedings or otherwise, and to recover from such Guarantor
the obligations.

 

Section 11.17        Amendment, Etc.  No amendment, modification or waiver of any
provision of this Indenture relating to any Guarantor or consent to any
departure by any Guarantor or any other Person from any such provision will in
any event be effective unless it is signed by such Guarantor and the Trustee.

 

Section 11.18        Acknowledgment.  Each Guarantor hereby acknowledges
communication of the terms of this Indenture and the Notes and consents to and
approves of the same.

 

Section 11.19        Costs and Expenses.  Each Guarantor shall pay on demand by the
Trustee any and all costs, fees and expenses (including, without limitation,
legal fees) incurred by the Trustee, its agents, advisors and counsel or any of
the Holders in enforcing any of their rights under any Guarantee.

 

Section 11.20        No Waiver; Cumulative
Remedies.  No failure
to exercise and no delay in exercising, on the part of the Trustee or the
Holders, any right, remedy, power or privilege hereunder or under this
Indenture or the Notes, shall operate as a waiver thereof; nor shall any single
or partial exercise of any right, remedy, power or privilege hereunder or under
this Indenture or the Notes preclude any other or further exercise thereof or
the exercise of any other right, remedy, power or privilege.  The rights, remedies, powers and privileges
in the Guarantee and under this Indenture, the Notes and any other document or
instrument between a Guarantor and/or the Company and the Trustee are
cumulative and not exclusive of any rights, remedies, powers and privilege
provided by law.

 

Section 11.21        Guarantee in Addition to
Other Obligations.  The
obligations of each 

 

81

 

Guarantor under its Guarantee and this Indenture are
in addition to and not in substitution for any other obligations to the Trustee
or to any of the Holders in relation to this Indenture or the Notes and any
guarantees or security at any time held by or for the benefit of any of them.

 

Section 11.22         Severability.  Any provision of this Article Eleven
which is prohibited or unenforceable in any jurisdiction shall not invalidate
the remaining provisions and any such prohibition or unenforceability in any
jurisdiction shall not invalidate or render unenforceable such provision in any
other jurisdiction unless its removal would substantially defeat the basic
intent, spirit and purpose of this Indenture and this Article Eleven.

 

Section 11.23         Successors and Assigns.  Unless released in accordance with this
Indenture, each Guarantee shall be binding upon and inure to the benefit of
each Guarantor and the Trustee and the other Holders and their respective
successors and permitted assigns, except that no Guarantor may assign any of
its obligations hereunder or thereunder.

 

ARTICLE XII

[RESERVED]

 

ARTICLE XIII

MISCELLANEOUS

 

Section 13.01         TIA 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.  If any provision of this Indenture modifies
or excludes any provision of the TIA that may be so modified or excluded, the
latter provision shall be deemed to apply to this Indenture as so modified or
excluded, as the case may be.

 

Section 13.02         Notices.  Any notices or other communications required
or permitted hereunder shall be in writing, and shall be sufficiently given if
made by hand delivery, by telex, by telecopier or registered or certified mail,
postage prepaid, return receipt requested, addressed as follows:

 

if to the Company or any
Guarantor:

 

Huntsman International LLC

500 Huntsman Way

Salt Lake City, Utah 84108

 

Attention:   Office of General
Counsel

 

82

 

if to the Trustee:

 

Wilmington Trust FSB

Corporate Capital Markets

50 South Sixth Street, Suite 1290

Minneapolis, MN 55402

 

Attention:   Huntsman
Administrator

 

The Company, the Guarantors
and the Trustee by written notice to each other may designate additional or
different addresses for notices.  Any
notice or communication to the Company, the Guarantors or the Trustee shall be
deemed to have been given or made as of the date so delivered if personally
delivered; when answered back, if telexed; when receipt is acknowledged, if
faxed; and five (5) calendar days after mailing if sent by registered or
certified mail, postage prepaid (except that a notice of change of address
shall not be deemed to have been given until actually received by the
addressee).

 

Any notice or communication
mailed to a Holder shall be mailed to him by first class mail or other
equivalent means at his address as it appears on the registration books of the
Registrar and shall be sufficiently given to him if so mailed within the time
prescribed.

 

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

 

Section 13.03        Communications by Holders
with Other Holders.  Holders may
communicate pursuant to TIA (§) 312(b) with other Holders with respect to
their rights under this Indenture or the Notes. 
The Company, the Trustee, the Registrar and any other Person shall have
the protection of TIA (§) 312(c).

 

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

 

(1)           an Officers’ Certificate, in form and substance
satisfactory to the Trustee, stating that, in the opinion of the signers, all
conditions precedent to be performed by the Company, 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 to be performed by the Company,
if any, provided for in this Indenture relating to the proposed action have
been complied with.

 

Section 13.05        Statements Required in
Certificate or Opinion.  Each
certificate or opinion with respect to compliance with a condition or covenant
provided for in this Indenture, other than the Officers’ Certificate required
by Section 4.07, shall include:

 

83

 

(1)           a statement that the Person making such certificate
or opinion has read such covenant or condition;

 

(2)           a brief statement as to the nature and scope of the
examination or investigation upon which the statements or opinions contained in
such certificate or opinion are based;

 

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

 

(4)           a statement as to whether or not, in the opinion of
each such Person, such condition or covenant has been complied with.

 

Section 13.06        Rules by Trustee,
Paying Agent, Registrar.  The
Trustee may make reasonable rules in accordance with the Trustee’s
customary practices for action by or at a meeting of Holders.  The Paying Agent or Registrar may make reasonable
rules for its functions.

 

Section 13.07        Legal Holidays.  If a payment date under this Indenture is not
a Business Day, payment may be made at such place on the next succeeding day
that is a Business Day, and no interest shall accrue for the intervening
period.

 

Section 13.08        Governing Law.  THIS INDENTURE, THE NOTES AND THE GUARANTEES
SHALL BE GOVERNED BY, AND CONSTRUED IN ACCORDANCE WITH, THE LAWS OF THE STATE OF
NEW YORK.  Each of the parties hereto
agrees to submit to the non-exclusive jurisdiction of the competent courts of
the State of New York in any action or proceeding arising out of or relating to
this Indenture or the Notes.

 

Section 13.09        No Adverse Interpretation of
Other Agreements.  This
Indenture may not be used to interpret another indenture, loan or debt
agreement of the Company or any of its Subsidiaries.  Any such indenture, loan or debt agreement may
not be used to interpret this Indenture.

 

Section 13.10        No Recourse Against Others.  A past, present or future director, officer,
member, manager, employee, stockholder or incorporator, as such, of the Company
or any Guarantor shall not have any liability for any obligations of the
Company or any Guarantor under the Notes, the Guarantees or this Indenture or
for any claim based on, in respect of or by reason of such obligations or their
creations.  Each Holder by accepting a
Note waives and releases all such liability. 
Such waiver and release are part of the consideration for the issuance
of the Notes.

 

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

 

84

 

Section 13.12         Duplicate Originals.  All parties may sign any number of copies of
this Indenture.  Each signed copy shall
be an original, but all of them together shall represent the same agreement.

 

Section 13.13         Severability.  In case any one or more of the provisions in
this Indenture or in the Notes shall be held invalid, illegal or unenforceable,
in any respect for any reason, the validity, legality and enforceability of any
such provision in every other respect and of the remaining provisions shall not
in any way be affected or impaired thereby, it being intended that all of the
provisions hereof shall be enforceable to the full extent permitted by law.

 

Section 13.14         Independence of Covenants.  All covenants and agreements in this
Indenture and the Notes shall be given independent effect so that if any
particular action or condition is not permitted by any of such covenants, the
fact that it would be permitted by an exception to, or otherwise be within the limitations
of, another covenant shall not avoid the occurrence of a Default or an Event of
Default if such action is taken or condition exists.

 

[Remainder of Page Intentionally Left
Blank]

 

85

 

SIGNATURES

 

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

 

	
   

  	
  HUNTSMAN INTERNATIONAL LLC

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ J. Kimo Esplin 

  
	
   

  	
   

  	
  Name:

  	
  J. Kimo Esplin

  
	
   

  	
   

  	
  Title:

  	
  Executive Vice President and Chief Financial Officer

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  GUARANTORS

  
	
   

  	
   

  
	
   

  	
  AIRSTAR CORPORATION

  
	
   

  	
  HUNTSMAN ETHYLENEAMINES LLC

  
	
   

  	
  HUNTSMAN INTERNATIONAL FINANCIAL LLC

  
	
   

  	
  HUNTSMAN INTERNATIONAL FUELS LLC

  
	
   

  	
  HUNTSMAN PROPYLENE OXIDE LLC

  
	
   

  	
  HUNTSMAN ADVANCED MATERIALS AMERICAS LLC

  
	
   

  	
  HUNTSMAN ADVANCED MATERIALS LLC

  
	
   

  	
  HUNTSMAN AUSTRALIA INC.

  
	
   

  	
  HUNTSMAN CHEMICAL PURCHASING CORPORATION

  
	
   

  	
  HUNTSMAN ENTERPRISES, INC.

  
	
   

  	
  HUNTSMAN HEADQUARTERS CORPORATION

  
	
   

  	
  HUNTSMAN INTERNATIONAL TRADING CORPORATION

  
	
   

  	
  HUNTSMAN MA INVESTMENT CORPORATION

  
	
   

  	
  HUNTSMAN MA SERVICES CORPORATION

  
	
   

  	
  HUNTSMAN PETROCHEMICAL LLC

  
	
   

  	
  HUNTSMAN PETROCHEMICAL PURCHASING CORPORATION

  
	
   

  	
  HUNTSMAN PROCUREMENT CORPORATION

  
	
   

  	
  HUNTSMAN PURCHASING, LTD.

  
	
   

  	
  By:

  	
  Huntsman Procurement
  Corporation, its General Partner

  
	
   

  	
  HUNTSMAN FUELS LLC

  
					

 

S-1

 

	
   

  	
   

  	
  POLYMER
  MATERIALS INC.

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  By:

  	
  /s/ Troy M. Keller

  
	
   

  	
   

  	
   

  	
  Name:

  	
  Troy M. Keller

  
	
   

  	
   

  	
   

  	
  Title:

  	
  Assistant
  Secretary

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Executed as a Deed by Troy
  M. Keller for and on behalf of Tioxide Americas Inc in the presence of 

  	
   

  	
  TIOXIDE
  AMERICAS INC.

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
        /s/ Sean H. Pettey

  	
   

  	
  By:

  	
  /s/ Troy M. Keller

  
	
  Witness

  	
   

  	
   

  	
  Name: 

  	
  Troy
  M. Keller

  
	
   

  	
   

  	
   

  	
  Title:

  	
  Assistant
  Secretary

  

 

S-2

 

	
   

  	
   

  	
  TIOXIDE GROUP

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  By:

  	
  /s/ J. Kimo Esplin

  
	
   

  	
   

  	
   

  	
  Name:

  	
  J. Kimo Esplin

  
	
   

  	
   

  	
   

  	
  Title:

  	
  Director

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  By:

  	
  /s/ L. Russell Healy

  
	
   

  	
   

  	
   

  	
  Name:

  	
  L. Russell Healy

  
	
   

  	
   

  	
   

  	
  Title:

  	
  Director

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  Wilmington
  Trust FSB, as Trustee

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  By:

  	
  /s/
  Jane Schweiger

  
	
   

  	
   

  	
   

  	
  Name:

  	
  Jane Schweiger

  
	
   

  	
   

  	
   

  	
  Title:

  	
  Vice President

  

 

S-3

 

EXHIBIT A

 

[FORM OF NOTE]

 

[THIS
SECURITY (OR ITS PREDECESSOR) WAS ORIGINALLY ISSUED IN A TRANSACTION EXEMPT
FROM REGISTRATION UNDER THE UNITED STATES SECURITIES ACT OF 1933, AS AMENDED
(THE “SECURITIES ACT”), AND THIS SECURITY MAY NOT BE OFFERED, SOLD OR
OTHERWISE TRANSFERRED IN THE ABSENCE OF SUCH REGISTRATION OR AN APPLICABLE
EXEMPTION THEREFROM. EACH PURCHASER OF THIS SECURITY IS NOTIFIED THAT THE
SELLER OF THIS SECURITY MAY BE RELYING ON THE EXEMPTION FROM THE
PROVISIONS OF SECTION 5 OF THE SECURITIES ACT PROVIDED BY RULE 144A
THEREUNDER. BY ITS ACQUISITION HEREOF, THE HOLDER OF THIS SECURITY (1) REPRESENTS
THAT (A) IT IS A “QUALIFIED INSTITUTIONAL BUYER” (AS DEFINED IN RULE 144A
UNDER THE SECURITIES ACT) OR (B) IT IS NOT A U.S. PERSON AND IS ACQUIRING
THIS SECURITY IN AN OFFSHORE TRANSACTION IN COMPLIANCE WITH RULE 904 UNDER THE
SECURITIES ACT.

 

THE HOLDER OF THIS SECURITY
AGREES FOR THE BENEFIT OF HUNTSMAN INTERNATIONAL LLC THAT (A) THIS
SECURITY MAY BE OFFERED, RESOLD, PLEDGED OR OTHERWISE TRANSFERRED, ONLY (I) TO
HUNTSMAN INTERNATIONAL LLC OR ITS SUBSIDIARIES, (II) INSIDE THE UNITED
STATES TO A PERSON WHO THE SELLER REASONABLY BELIEVES IS A QUALIFIED
INSTITUTIONAL BUYER (AS DEFINED IN RULE 144A UNDER THE SECURITIES ACT) IN A
TRANSACTION MEETING THE REQUIREMENTS OF RULE 144A, (III) OUTSIDE THE
UNITED STATES IN AN OFFSHORE TRANSACTION IN ACCORDANCE WITH RULE 904 UNDER THE
SECURITIES ACT, (IV) PURSUANT TO AN EXEMPTION FROM REGISTRATION UNDER THE
SECURITIES ACT PROVIDED BY RULE 144 THEREUNDER (IF AVAILABLE) OR (V) PURSUANT
TO AN EFFECTIVE REGISTRATION STATEMENT UNDER THE SECURITIES ACT, IN EACH OF
CASES (I) THROUGH (V) IN ACCORDANCE WITH ANY APPLICABLE SECURITIES
LAWS OF ANY STATE OF THE UNITED STATES, AND (B) THE HOLDER WILL, AND EACH
SUBSEQUENT HOLDER IS REQUIRED TO, NOTIFY ANY PURCHASER OF THIS SECURITY FROM IT
OF THE RESALE RESTRICTIONS REFERRED TO IN (A) ABOVE.] [Include for
Restricted Securities only]

 

A-1

 

HUNTSMAN INTERNATIONAL LLC

 

5 1/2 % Senior Note due 2016

 

	
  No.  $

  	
  CUSIP No.    

  

 

HUNTSMAN INTERNATIONAL LLC,
a Delaware limited liability company (the “Company”), for value received,
promises to pay to                     
or registered assigns, the principal sum of
$              ,[
or such greater or lesser principal sum as is shown on the attached Schedule of
Increases or Decreases in Global Security] [to be included in Global Securities
only], on June 30, 2016.

 

Interest Payment Dates: June 30
and December 31 (commencing December 31, 2009)

 

Record Dates: June 15
and December 15

 

Reference is made to the
further provisions of this Note contained herein, which will for all purposes
have the same effect as if set forth at this place.

 

A-2

 

IN WITNESS WHEREOF, the
Company has caused this Note to be signed manually or by facsimile by its duly
authorized officer.

 

	
  Dated:

  	
  HUNTSMAN INTERNATIONAL LLC

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
   

  
	
   

  	
   

  	
  Name:

  
	
   

  	
   

  	
  Title:

  

 

Certificate
of Authentication

 

This is one of the 5 1/2 % Senior
Notes due 2016 referred to in the within-mentioned Indenture.

 

	
  Dated:

  	
  Wilmington Trust FSB, as Trustee

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
   

  
	
   

  	
   

  	
  Authorized Signature

  

 

A-3

 

(REVERSE OF NOTE)

 

5 1/2 % Senior Note due 2016

 

1.             Interest. HUNTSMAN INTERNATIONAL LLC, a Delaware
limited liability company (the “Company”), promises to pay interest on the
principal amount of this Note at the rate per annum shown above. Interest on
the Notes will accrue from the most recent date on which interest has been paid
or, if no interest has been paid, from June 23, 2009. The Company will pay
interest semi-annually in arrears on each June 30 and December 31
(each, an “Interest Payment Date”) and at stated maturity, commencing on December 31,
2009. Interest will be computed on the basis of a 360-day year comprised of
twelve 30-day months.

 

The Company shall pay
interest on overdue principal and on overdue installments of interest from time
to time on demand at the rate borne by the Notes (without regard to any
applicable grace periods) to the extent lawful.

 

2.             Method of Payment. The Company shall pay interest
on the Notes (except defaulted interest) to the Persons who are the registered
Holders at the close of business on the June 15 or December 15 (each,
a “Record Date”) immediately preceding the Interest Payment Date even if the
Notes are cancelled on registration of transfer or registration of exchange
after such Record Date. Holders must surrender Notes to a Paying Agent to
collect principal payments. The Company shall pay principal, premium and
interest in money of the United States that at the time of payment is legal
tender for payment of public and private debts (“U.S. Legal Tender”). However,
the Company may pay principal, premium and interest by its check payable in
such U.S. Legal Tender. The Company may deliver any such interest payment to
the Paying Agent or to a Holder at the Holder’s registered address.

 

3.             Paying Agent and Registrar. Initially, Wilmington
Trust FSB (the “Trustee”) will act as Paying Agent and Registrar. The Company
may change any Paying Agent, Registrar or co-Registrar without notice to the
Holders. The Company or any of its Subsidiaries may, subject to certain
exceptions, act as Registrar or co-Registrar.

 

4.             Indenture. The Company issued the Notes under an
Indenture, dated as of July 6, 2009 (the “Indenture”), among the Company,
each of the Guarantors named therein and the Trustee. This Note is one of a
duly authorized issue of Notes of the Company designated as its 5 1⁄2 % Senior
Notes due 2016 (the “Notes”), which may be issued under the Indenture. The
Company shall be entitled to issue Additional Notes pursuant to Section 2.18
of the Indenture. The Notes and any Additional Notes and any Exchange Notes
issued in accordance with the Indenture are treated as a single class of
securities under the Indenture unless otherwise specified in the Indenture. Capitalized
terms used herein shall have the meanings assigned to them in the Indenture
unless otherwise defined herein. The terms of the Notes include those stated in
the Indenture and those made part of the Indenture by reference to the Trust Indenture
Act of 1939 (15 U.S.C. §§ 77aaa-77bbbb) (the “TIA”), as in effect on the
date of the Indenture. Notwithstanding anything to the contrary herein, the
Notes are subject to all such terms, and Holders of Notes are referred to the
Indenture and the TIA for a statement of them.

 

A-4

 

5.             Optional Redemption. The Notes will be
redeemable, at the Company’s option, in whole at any time or in part from time
to time, upon not less than 30 nor more than 60 days’ notice, at a redemption
price equal to the principal amount thereof, plus accrued and unpaid interest
thereon, if any, to the date of redemption.

 

6.             Notice of Redemption. Notice of redemption will
be delivered at least 30 days but not more than 60 days before the Redemption
Date to each Holder whose Notes are to be redeemed at such Holder’s registered
address, except as provided in the Indenture. Notes in denominations larger
than $2,000 may be redeemed in part.

 

7.             Change of Control Offer. In the event of a Change
of Control, upon the satisfaction of the conditions set forth in the Indenture,
the Company shall be required to offer to repurchase all of the then
outstanding Notes pursuant to a Change of Control Offer at a purchase price
equal to 101% of the principal amount thereof plus accrued and unpaid interest,
if any, to the date of purchase. Holders of Notes that are the subject of such
an offer to repurchase shall receive an offer to repurchase and may elect to
have such Notes repurchased in accordance with the provisions of the Indenture
pursuant to and in accordance with the terms of the Indenture.

 

8.             Limitation on Asset Sales. Under certain
circumstances set forth in Section 4.15 of the Indenture, the Company is
required to apply the net proceeds from Asset Sales to offer to repurchase the
Notes at a price equal to 100% of the principal amount thereof plus accrued and
unpaid interest thereon, if any, to the date of repurchase.

 

9.             Denominations; Transfer; Exchange. The Notes are
in fully registered form only, without coupons, in denominations of $2,000 and
integral multiples of $1,000 in excess thereof. A Holder shall register the
transfer or exchange of Notes in accordance with the Indenture. The Registrar
may require a Holder, among other things, to furnish appropriate endorsements
and transfer documents and to pay certain transfer taxes or similar
governmental charges payable in connection therewith as permitted by the Indenture.
The Registrar need not register the transfer or exchange of any Notes during a
period beginning 15 days before the mailing of a redemption notice for any
Notes or portions thereof selected for redemption.

 

10.           Persons Deemed Owners. The registered Holder of a
Note shall be treated as the owner of it for all purposes.

 

11.           Unclaimed Money. If money for the payment of
principal or interest remains unclaimed for one year, the Trustee and the
Paying Agent will pay the money back to the Company. After that, all liability
of the Trustee and such Paying Agent with respect to such money shall cease.

 

12.           Discharge Prior to Redemption or Maturity. If the
Company at any time deposits with the Trustee U.S. Legal Tender or non-callable
U.S. Government Obligations sufficient to pay the principal of, premium and
interest on the Notes to redemption or maturity and complies with the other
provisions of this Indenture relating thereto, the Company will be discharged
from certain provisions of the Indenture and the Notes (including certain
covenants, but excluding its

 

A-5

 

obligation to pay the
principal of, premium and interest on the Notes).

 

13.           Amendment; Supplement; Waiver. The Indenture or the
Notes may be amended or supplemented as provided in the Indenture.

 

14.           Restrictive Covenants. The Indenture imposes
certain limitations on the ability of the Company and its Subsidiaries to,
among other things, incur additional Indebtedness, create Liens, pay dividends
or make certain other restricted payments, enter into transactions with
Affiliates, create dividend or other payment restrictions affecting Restricted
Subsidiaries and merge or consolidate with any other Person, sell, assign,
transfer, lease, convey or otherwise dispose of all or substantially all of its
assets or adopt a plan of liquidation. Such limitations are subject to a number
of important qualifications and exceptions. The Company must annually report to
the Trustee on compliance with such limitations.

 

15.           Successors. When a successor assumes, in accordance
with this Indenture, all the obligations of its predecessor under the Notes and
the Indenture, the predecessor will be released from those obligations.

 

16.           Defaults and Remedies. If an Event of Default
occurs and is continuing, the Trustee or the Holders of at least 25% in
principal amount of the then outstanding Notes (including any Additional Notes)
may declare all the Notes to be due and payable in the manner, at the time and
with the effect provided in the Indenture. Holders of Notes may not enforce the
Indenture or the Notes except as provided in the Indenture. The Trustee is not
obligated to enforce the Indenture or the Notes unless it has been offered
indemnity or security reasonably satisfactory to it. The Indenture permits,
subject to certain limitations therein provided, Holders of a majority in
aggregate principal amount of the Notes (including any Additional Notes) then
outstanding to direct the Trustee in its exercise of any trust or power. The
Trustee may withhold from Holders of Notes notice of any continuing Default or
Event of Default (except a Default in payment of principal or interest) if it
determines in good faith that withholding notice is in their interest.

 

17.           Trustee Dealings with Company. The Trustee under
the Indenture, in its individual or any other capacity, may become the owner or
pledgee of Notes and may otherwise deal with the Company, its Restricted and
Unrestricted Subsidiaries or their respective Affiliates as if it were not the
Trustee.

 

18.           No Recourse Against Others. No past, present or
future stockholder, director, officer, employee or incorporator, as such, of
the Company shall have any liability for any obligation of the Company under
the Notes or the Indenture or for any claim based on, in respect of or by
reason of, such obligations or their creation. Each Holder of a Note by
accepting a Note waives and releases all such liability. The waiver and release
are part of the consideration for the issuance of the Notes.

 

19.           Authentication. This Note shall not be valid until
the Trustee or authenticating agent manually signs the certificate of
authentication on this Note.

 

A-6

 

20.           Governing Law. This Note shall be governed by, and
construed in- accordance with, the laws of the State of New York.

 

21.           Abbreviations and Defined Terms. Customary
abbreviations may be- used in the name of a Holder of a Note or an assignee,
such as: TEN COM (= tenants in common), TEN ENT (= tenants by the entireties),
JT TEN (= joint tenants with right of survivorship and not as tenants in
common), CUST (= Custodian), and U/G/M/A (= Uniform Gifts to Minors Act).

 

22.           CUSIP/ISIN Numbers. The Company may cause CUSIP
and/or ISIN numbers to be printed on the Notes as a convenience to the Holders
of the Notes. No representation is made as to the accuracy of such numbers as
printed on the Notes and reliance may be placed only on the other
identification numbers printed hereon.

 

[23.          Registration Rights. Pursuant
to the Registration Rights Agreement, the Company and the Guarantors may be
obligated upon the occurrence of certain events and subject to certain
conditions to consummate an exchange offer pursuant to which the Holder of this
Note shall have the right to exchange this Note for a 5 1⁄2 % Senior Note due
2016, of the Company (an “Unrestricted Note”) which have been registered under
the Securities Act, in like principal amount and having terms identical in all
material respects as this Note. The Holders may be entitled to receive certain
additional interest payments in the event such exchange offer is not
consummated and upon certain other conditions, all pursuant to and in
accordance with the terms of the Registration Rights Agreement.][Include for
Restricted Securities only]

 

24.           Indenture. Each Holder, by accepting a Note, agrees
to be bound by all of the terms and provisions of the Indenture, as the same
may be amended from time to time. Capitalized terms used herein and not defined
herein have the meanings ascribed thereto in the Indenture

 

25.           Guarantees. This Note will be entitled to the
benefits of certain Guarantees made for the benefit of the Holders. Reference
is hereby made to the Indenture for a statement of the respective rights,
limitations of rights, duties and obligations thereunder of the Guarantors, the
Trustee and the Holders.

 

The Company will furnish to
any Holder of a Note upon written request and without charge a copy of the
Indenture. Requests may be made to: HUNTSMAN INTERNATIONAL LLC, 500 Huntsman
Way, Salt Lake City, Utah 84108, Attention: Office of General Counsel.

 

A-7

 

[SCHEDULE OF INCREASES OR DECREASES IN GLOBAL
SECURITY]

[to be included in Global Securities only]

 

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

 

	
  Date
  of

  exchange

  	
   

  	
  Amount of decrease in

  principal amount of this

  Global Security

  	
   

  	
  Amount of increase in

  principal amount of this

  Global Security

  	
   

  	
  Principal amount of this

  Global Security following

  such decrease (or increase)

  	
   

  	
  Signature of authorized

  officer of Trustee or

  Depositary

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  

 

A-8

 

[FORM OF ASSIGNMENT]

 

I or we assign to

 

PLEASE INSERT SOCIAL SECURITY

OR OTHER IDENTIFYING NUMBER

 

	
   

  	
   

  
	
   

  	
   

  
	
   

  

(please print or type name
and address)

 

	
   

  
	
   

  
	
   

  
	
   

  
	
  the within Note and all rights thereunder, and hereby irrevocably
  constitutes and appoints

  

 

 

attorney to transfer the Note on the books of the
Company with full power of substitution in the premises.

 

	
  Dated:

  	
   

  	
   

  	
   

  
	
   

  	
  NOTICE: The signature on this assignment must correspond with the
  name as it appears upon the face of the within Note in every particular
  without alteration or enlargement or any change whatsoever and be guaranteed
  by the endorser’s bank or broker.

  

 

	
    Signature Guarantee:

  	
   

  

 

A-9

 

[In
connection with any transfer of this Note occurring prior to the date of the declaration
by the Commission of the effectiveness of a registration statement under the Securities
Act of 1933, as amended (the “Securities Act”) covering resales of this Note
(which effectiveness shall not have been suspended or terminated at the date of
the transfer) the undersigned confirms that it has not utilized any general
solicitation or general advertising in connection with the transfer and that
the sale is being made:

 

[Check One]

 

	
  (1)

  	
  —

  	
  to the Company or a subsidiary thereof; or

  
	
   

  	
   

  	
   

  
	
  (2)

  	
  —

  	
  pursuant to and in compliance with Rule 144A under the
  Securities Act of 1933, as amended; or

  
	
   

  	
   

  	
   

  
	
  (3)

  	
  —

  	
  to an institutional “accredited investor” (as defined in
  Rule 501(a)(1), (2), (3) or (7) under the Securities Act of
  1933, as amended) that has furnished to the Trustee a signed letter
  containing certain representations and agreements (the form of which letter
  can be obtained from the Trustee); or

  
	
   

  	
   

  	
   

  
	
  (4)

  	
  —

  	
  outside the United States to a “foreign purchaser” in compliance with
  Rule 904 of Regulation S under the Securities Act of 1933, as amended;
  or

  
	
   

  	
   

  	
   

  
	
  (5)

  	
  —

  	
  pursuant to the exemption from registration provided by Rule 144
  under the Securities Act of 1933, as amended; or

  
	
   

  	
   

  	
   

  
	
  (6)

  	
  —

  	
  pursuant to an effective registration statement under the Securities
  Act of 1933, as amended; or

  
	
   

  	
   

  	
   

  
	
  (7)

  	
  —

  	
  pursuant to another available exemption from the registration
  statement requirements of the Securities Act of 1933, as amended,

  

 

and, unless the box below is checked, the
undersigned confirms that such Note is not being transferred to an “affiliate”
of the Company as defined in Rule 144 under the Securities Act of 1933, as
amended (an “Affiliate”):

 

	
   

  	
  [_]

  	
  The transferee is an Affiliate of the Company.

  

 

Unless one of the items is
checked, the Trustee will refuse to register any of the Notes evidenced by this
certificate in the name of any person other than the registered Holder thereof;
provided, however, that if item (3), (4), (5) or (7) is
checked, the Company or the Trustee may 

 

A-10

 

require, prior to
registering any such transfer of the Notes, in their sole discretion, such
written legal opinions, certifications (including an investment letter in the
case of box (3) or (4) and other information as the Trustee or the
Company have reasonably requested to confirm that such transfer is being made
pursuant to an exemption from, or in a transaction not subject to, the
registration requirements of the Securities Act of l933, as amended.

 

If none of the foregoing
items are checked, the Trustee or Registrar shall not be obligated to register
this Note in the name of any person other than the Holder hereof unless and
until the conditions to any such transfer of registration set forth herein and
in Section 2.16 of the Indenture shall have been satisfied.

 

	
  Dated:

  	
   

  	
   

  	
  Signed:

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
  (Sign exactly as name appears

  on the other side of this Note)

  

 

 

	
  Signature Guarantee:

  	
   

  

 

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

 

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

 

	
  Dated:

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
  NOTICE:

  	
  To be executed by an executive officer] [To be included in Restricted
  Securities only]

  

 

A-11

 

OPTION OF HOLDER TO ELECT PURCHASE

 

If you want to elect to have
this Note purchased by the Company pursuant to Section 4.14 or Section 4.15
of the Indenture, check the appropriate box:

 

Section 4.14 [ ] Section 4.15
[ ]

 

If you want to elect to have
only part of this Note purchased by the Company pursuant to Section 4.14
or Section 4.15 of the Indenture, state the amount: $

 

	
  Dated:

  	
   

  	
   

  	
  Signed:

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
  (Sign exactly as name appears

  on the other side of this Note)

  

 

 

	
  Signature Guarantee:

  	
   

  
	
   

  	
  Participant in a recognized Signature

  
	
   

  	
  Guarantee Medallion Program (or other

  
	
   

  	
  signature guarantor program reasonably

  
	
   

  	
  acceptable to the Trustee)

  

 

A-12

 

EXHIBIT B

 

FORM OF LEGEND FOR
GLOBAL SECURITY

 

Any Global Security
authenticated and delivered hereunder shall bear a legend (which would be in
addition to any other legends required in the case of a Restricted Security) in
substantially the following form:

 

THIS NOTE IS A GLOBAL
SECURITY WITHIN THE MEANING OF THE INDENTURE HEREINAFTER REFERRED TO AND IS
REGISTERED IN THE NAME OF A DEPOSITORY OR A NOMINEE OF A DEPOSITORY OR A
SUCCESSOR DEPOSITORY.  THIS NOTE IS NOT
EXCHANGEABLE FOR NOTES REGISTERED IN THE NAME OF A PERSON OTHER THAN THE
DEPOSITORY OR ITS NOMINEE EXCEPT IN THE LIMITED CIRCUMSTANCES DESCRIBED IN THE
INDENTURE, AND NO TRANSFER OF THIS NOTE (OTHER THAN A TRANSFER OF THIS NOTE AS
A WHOLE BY THE DEPOSITORY TO A NOMINEE OF THE DEPOSITORY OR BY A NOMINEE OF THE
DEPOSITORY TO THE DEPOSITORY OR ANOTHER NOMINEE OF THE DEPOSITORY) MAY BE
REGISTERED EXCEPT IN THE LIMITED CIRCUMSTANCES DESCRIBED IN THE INDENTURE.

 

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

 

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

 

B-1

 

EXHIBIT C-1

 

FORM OF TRANSFER CERTIFICATE

RESTRICTED GLOBAL SECURITY TO

REGULATION S GLOBAL SECURITY

 

(Transfers Pursuant to Sections 2.16(a)(ii) of
the Indenture)

 

Wilmington
Trust FSB

Corporate Capital Markets

50 South Sixth Street, Suite 1290

Minneapolis, MN 55402

Attention:
Huntsman Administrator

 

Huntsman
International LLC

500
Huntsman Way

Salt
Lake City, Utah 84108

Attention:  Secretary

 

Re:                               Huntsman
International LLC 5 1⁄2 % Senior Notes due 2016 (the “Securities”)

 

Reference is hereby made to
the amended and restated Indenture, dated as of September [·], 2009 between the Company, the Guarantors named
therein and Wilmington Trust FSB, as trustee, (the “Indenture”).  Terms used but not defined herein and defined
in Regulation S under the U.S. Securities Act of 1933 (the “Securities Act”) or
in the Indenture shall have the meanings given to them in Regulation S or the
Indenture, as the case may be.

 

This certificate relates to
U.S.$           principal
amount of Securities, which are evidenced by the following certificate(s) (the
“Specified Securities”):

 

CUSIP
No(s).

 

CERTIFICATE
No(s).

 

The person in whose name
this certificate is executed below (the “Undersigned”) hereby certifies that
either (i) it is the sole beneficial owner of the Specified Securities or (ii) it
is acting on behalf of all the beneficial owners of the Specified Securities
and is duly authorized by them to do so. 
Such beneficial owner or owners are referred to herein collectively as
the “Owner”.  If the Specified Securities
are represented by a Global Security, they are held through the appropriate Depositary
or an Agent Member in the name of the Undersigned, as or on behalf of the
Owner.

 

The Owner has requested that
the Specified Securities be transferred to a person (the “Transferee”) who will
take delivery in the form of an interest in the Regulation S Global
Security.  In connection with such
transfer, the Owner hereby certifies that such transfer is being 

 

C-1-1

 

effected in accordance with Rule 904
under the Securities Act and with all applicable securities laws of the states
of the United States and other jurisdictions. 
Accordingly, the Owner hereby further certifies as follows:

 

(1)                                  the Owner is
not a distributor of the Specified Securities, an Affiliate of the Company or
any such distributor or a person acting on behalf of any of the foregoing;

 

(2)                                  the offer of
the Specified Securities was not made to a person in the United States;

 

(3)                                  either:

 

(A)                              at the time the
buy order was originated, the Transferee was outside the United States or the
Owner and any person acting on its behalf reasonably believed that the
Transferee was outside the United States; or

 

(B)                                the transaction
is being executed in, on or through the facilities of the Eurobond market, as
regulated by the Association of International Bond Dealers, or another
designated offshore securities market and neither the Owner nor any person
acting on its behalf knows that the transactions has been prearranged with a
buyer in the United States;

 

(4)                                  no directed
selling efforts have been made in the United States by or on behalf of the
Owner or any Affiliate thereof;

 

(5)                                  if the Owner is
a dealer in securities or has received a selling concession, fee or other remuneration
in respect of the Specified Securities, and the transfer is to occur during the
Restricted Period, then the requirements of Rule 904(c)(1) have been
satisfied; and

 

(6)                                  the transaction
is not part of a plan or scheme to evade the registration requirements of the
Securities Act; and

 

(7)                                  upon completion
of the transaction, the beneficial interest being transferred will be held
through an Agent Member acting for and on behalf of Euroclear or Clearstream.

 

C-1-2

 

This certificate and the
statements contained herein are made for your benefit and the benefit of the
Company.

 

Dated:

 

 

	
   

  	
   

  
	
   

  	
  (Print the name of the Undersigned, as such term is defined in the
  second paragraph of this certificate.) 

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
   

  
	
   

  	
   

  	
  Name:

  
	
   

  	
   

  	
  Title:

  
	
   

  	
   

  
	
   

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

  

 

C-1-3

 

EXHIBIT C-2

 

FORM OF TRANSFER CERTIFICATE

RESTRICTED GLOBAL SECURITY TO UNRESTRICTED

GLOBAL SECURITY

 

(Transfers Pursuant to Sections 2.16(a)(iii) of
the Indenture)

 

Wilmington
Trust FSB

Corporate Capital Markets

50 South Sixth Street, Suite 1290

Minneapolis, MN 55402

Attention:
Huntsman Administrator

 

Huntsman
International LLC

500
Huntsman Way

Salt
Lake City, Utah 84108

Attention:  Secretary

 

Re:                               Huntsman
International LLC 5 1⁄2 % Senior Notes due 2016 (the “Securities”)

 

Reference is hereby made to
the amended and restated Indenture, dated as of September [·], 2009 between the Company, the Guarantors named
therein and Wilmington Trust FSB, as trustee, (the “Indenture”).  Terms used but not defined herein and defined
in Regulation S under the U.S. Securities Act of 1933 (the “Securities Act”) or
in the Indenture shall have the meanings given to them in Regulation S or the
Indenture, as the case may be.

 

This certificate relates to
U.S.$           principal
amount of Securities, which are evidenced by the following certificate(s) (the
“Specified Securities”):

 

CUSIP
No(s).

 

CERTIFICATE
No(s).

 

The person in whose name
this certificate is executed below (the “Undersigned”) hereby certifies that
either (i) it is the sole beneficial owner of the Specified Securities or (ii) it
is acting on behalf of all the beneficial owners of the Specified Securities
and is duly authorized by them to do so. 
Such beneficial owner or owners are referred to herein collectively as
the “Owner”.  If the Specified Securities
are represented by a Global Security, they are held through the appropriate Depositary
or an Agent Member in the name of the Undersigned, as or on behalf of the
Owner.

 

The Owner has requested that
the Specified Securities be transferred to a person (the “Transferee”) who will
take delivery in the form of an interest in the Unrestricted Global
Security.  In connection with such
transfer, the Owner hereby certifies that such transfer is being 

 

C-2-1

 

effected in accordance with Rule 904
or Rule 144 under the Securities Act and with all applicable securities
laws of the states of the United States and other jurisdictions.  Accordingly, the Owner hereby further
certifies as follows:

 

(1)                                  Rule 904
Transfers.  If the transfer is being
effected in accordance with Rule 904:

 

(A)                              the Owner is
not a distributor of the Specified Securities, an Affiliate of the Company or
any such distributor or a person acting on behalf of any of the foregoing;

 

(B)                                the offer of
the Specified Securities was not made to a person in the United States;

 

(C)                                either:

 

(i)                                     at the time the
buy order was originated, the Transferee was outside the United States or the
Owner and any person acting on its behalf reasonably believed that the
Transferee was outside the United States; or

 

(ii)                                  the transaction
is being executed in, on or through the facilities of the Eurobond market, as
regulated by the Association of International Bond Dealers, or another
designated offshore securities market and neither the Owner nor any person
acting on its behalf knows that the transactions has been prearranged with a
buyer in the United States;

 

(D)                               no directed
selling efforts have been made in the United States by or on behalf of the
Owner or any Affiliate thereof;

 

(E)                                 if the Owner is
a dealer in securities or has received a selling concession, fee or other
remuneration in respect of the Specified Securities, and the transfer is to
occur during the Restricted Period, then the requirements of Rule 904(c)(1) have
been satisfied; and

 

(F)                                 the transaction
is not part of a plan or scheme to evade the registration requirements of the
Securities Act.

 

(2)                                  Rule 144
Transfers.  If the transfer is being
effected pursuant to Rule 144:

 

(A)                              the transfer is
being effected in accordance with the applicable amount, manner of sale and
notice requirements of Rule 144; or

 

(B)                                the transfer is
occurring after [date one year after the latest date of issuance of any of the
Specified Securities] and the Owner is not, and during the preceding three
months has not been, an Affiliate of the Company.

 

C-2-2

 

This certificate and the
statements contained herein are made for your benefit and the benefit of the
Company.

 

Dated:

 

 

	
   

  	
   

  
	
   

  	
  (Print the name of the Undersigned, as such term is defined in the
  second paragraph of this certificate.) 

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
   

  
	
   

  	
   

  	
  Name:

  
	
   

  	
   

  	
  Title:

  
	
   

  	
   

  
	
   

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

  

 

C-2-3

 

EXHIBIT C-3

 

FORM OF TRANSFER CERTIFICATE

REGULATION S GLOBAL SECURITY TO

RESTRICTED GLOBAL SECURITY

 

(Transfers to QIBs Pursuant to Sections
2.16(a)(iv) of the Indenture)

 

Wilmington
Trust FSB

Corporate Capital Markets

50 South Sixth Street, Suite 1290

Minneapolis, MN 55402

Attention:
Huntsman Administrator

 

Huntsman
International LLC

500
Huntsman Way

Salt
Lake City, Utah 84108

Attention:  Secretary

 

Re:                               Huntsman
International LLC 5 1⁄2 % Senior Notes due 2016 (the “Securities”)

 

Reference is hereby made to
the amended and restated Indenture, dated as of September [·], 2009 between the Company, the Guarantors named
therein and Wilmington Trust FSB, as trustee, (the “Indenture”).  Terms used but not defined herein and defined
in Regulation S under the U.S. Securities Act of 1933 (the “Securities Act”) or
in the Indenture shall have the meanings given to them in Regulation S or the
Indenture, as the case may be.

 

This certificate relates to
U.S.$           principal
amount of Securities, which are evidenced by the following certificate(s) (the
“Specified Securities”):

 

CUSIP
No(s).

 

CERTIFICATE
No(s).

 

The person in whose name
this certificate is executed below (the “Undersigned”) hereby certifies that
either (i) it is the sole beneficial owner of the Specified Securities or (ii) it
is acting on behalf of all the beneficial owners of the Specified Securities
and is duly authorized by them to do so. 
Such beneficial owner or owners are referred to herein collectively as
the “Owner”.  If the Specified Securities
are represented by a Global Security, they are held through the appropriate Depositary
or an Agent Member in the name of the Undersigned, as or on behalf of the
Owner.

 

The Owner has requested that
the Specified Securities be transferred to a person (the “Transferee”) who will
take delivery in the form of an interest in the Restricted Global
Security.  In connection with such
transfer, the Owner hereby certifies that such transfer is being effected 

 

C-3-1

 

in accordance with Rule 144A
under the Securities Act and with all applicable securities laws of the states
of the United States and other jurisdictions. 
Accordingly, the Owner hereby further certifies as follows:

 

(1)                                  the Specified
Securities are being transferred to a person that the Owner and any person
acting on its behalf reasonably believe is a “qualified institutional buyer”
within the meaning of Rule 144A, acquiring for its own account or for the
account of a qualified institutional buyer; and

 

(2)                                  the Owner and
any person acting on its behalf have taken reasonable steps to ensure that the
Transferee is aware that the Owner may be relying on Rule 144A in
connection with the transfer.

 

This certificate and the
statements contained herein are made for your benefit and the benefit of the
Company.

 

Dated:

 

	
   

  	
   

  
	
   

  	
  (Print the name of the Undersigned, as such term is defined in the
  second paragraph of this certificate.) 

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
   

  
	
   

  	
   

  	
  Name:

  
	
   

  	
   

  	
  Title:

  
	
   

  	
   

  
	
   

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

  

 

C-3-2

 

EXHIBIT D

 

FORM OF CERTIFICATE TO BE

DELIVERED IN CONNECTION WITH

TRANSFERS TO INSTITUTIONAL ACCREDITED INVESTORS

 

(Transfers Pursuant to Section 2.17(a) of
the Indenture)

 

Wilmington
Trust FSB

Corporate Capital Markets

50 South Sixth Street, Suite 1290

Minneapolis, MN 55402

Attention: Huntsman Administrator

 

Huntsman International LLC

500
Huntsman Way

Salt
Lake City, Utah 84108

Attention:  Secretary

 

Re:                               Huntsman
International LLC 5 1⁄2 % Senior Notes due 2016 (the “Securities”)

 

Ladies and Gentlemen:

 

Reference is hereby made to
the amended and restated Indenture, dated as of September [·], 2009 between
the Company, the Guarantors named therein and Wilmington Trust FSB, as trustee
(the “Indenture”).  Terms used but not
defined herein have the meanings given to them in the Indenture.

 

This certificate relates to
$         principal amount of
Securities, which are evidenced by the following certificate(s):

 

1.  We understand that the Securities have not
been registered under the Securities Act of 1933, as amended (the “Securities
Act”), and may not be sold except as permitted in the following sentence.  We understand and agree, on our own behalf
and on behalf of any accounts for which we are acting as hereinafter stated, (x) that
such Securities are being offered only in a transaction not involving any
public offering within one year after the date of the original issuance of the
Securities or if within three months after we cease to be an affiliate (within
the meaning of Rule 144 under the Securities Act) of the Company, such
Securities may be resold, pledged or transferred only (i) to the Company, (ii) so
long as the Securities are eligible for resale pursuant to Rule 144A under
the Securities Act (“Rule 144A”), to a person whom we reasonably believe
is a “qualified institution buyer” (as defined in Rule 144A) (“QIB”) that
purchases for its own account or for the account of a QIB to whom notice is
given that the resale, pledge or transfer is being made in reliance on Rule 144A
(as indicated by the box checked by the transferor on the Certificate of
Transfer on the reverse of the certificate for the Securities), (iii) in
an offshore transaction in accordance with Regulation S under the Securities
Act (as 

 

D-1

 

indicated by the box checked
by the transferor on the Certificate of Transfer on the reverse of the Note if
the Note is not in book-entry form), and, if such transfer is being effected by
certain transferors prior to the expiration of the “40-day distribution
compliance period” (within the meaning of Rule 903(b)(2) of
Regulation S under the Securities Act), a certificate that may be obtained from
the Trustee is delivered by the transferee, (iv) to an institution that is
an “accredited investor” as defined in Rule 501(a)(1), (2), (3) or (7) under
the Securities Act (as indicated by the box checked by the transferor on the
Certificate of Transfer on the reverse of the certificate for the Securities)
which has certified to the Company and the Trustee for the Securities that it
is such an accredited investor and is acquiring the Securities for investment
purposes and not for distribution (provided that no Securities purchased from a
foreign purchaser or from any person other than a QIB or an institutional
accredited investor pursuant to this clause (iii) shall be permitted to
transfer any Securities so purchased to an institutional accredited investor
pursuant to this clause (iv) prior to the expiration of the “applicable
restricted period” (within the meaning of Regulation S under the Securities
Act), (v) pursuant to an exemption from registration under the Securities
Act provided by Rule 144 (if applicable) under the Securities Act, or (vi) pursuant
to an effective registration statement under the Securities Act, in each case
in accordance with any applicable securities laws of any state of the United
States, and we will notify any purchaser of the Securities from us of the above
resale restriction, if then applicable. 
We further understand that in connection with any transfer of the
Securities by us that the Company and the Trustee for the Securities may
request, and if so requested we will furnish, such certificates, legal opinions
and other information as they may reasonably require to confirm that any such
transfer complies with the foregoing restrictions.

 

2.  We are able to fend for ourselves in the
transactions contemplated hereby, we have such knowledge and experience in financial
and business matters as to be capable of evaluating the merits and risks of our
investment in the Securities, and we and any accounts for which we are acting
are each able to bear the economic risk of our or its investment and can afford
the complete loss of such investment.

 

3.  We understand that the Company and others
will rely upon the truth and accuracy of the foregoing acknowledgments,
representations and agreements and we agree that if any of the acknowledgments,
representations and warranties deemed to have been made by us by our purchase
of Securities, for our own account or of one or more accounts as to each of
which we exercise sole investment discretion, are no longer accurate, we shall
promptly notify the Company.

 

4.  We are acquiring the Securities purchased by
us for investment purposes and not for distribution of our own account or for
one or more accounts as to each of which we exercise sole investment discretion
and we are or such account is an institutional “accredited investor” (as defined
in rule 501(a)(1), (2), (3) or (7) of Regulation D under the
Securities Act).

 

5.  You are entitled to rely upon this letter and
you are irrevocably authorized to produce this letter or a copy hereof to any
interested party in any administrative or legal proceeding or official inquiry
with respect to the matters covered hereby.

 

D-2

 

	
   

  	
  Very truly yours,

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  (Name of Purchaser)

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
   

  

 

 

Date:

 

D-3

 

EXHIBIT E

 

GUARANTEE

 

For value received, the
undersigned hereby unconditionally guarantees, as principal obligor and not
only as a surety, to the Holder of this Note the payments of principal of,
premium, if any, and interest on this Note in the amounts and at the times when
due and interest on the overdue principal, premium, if any, and interest, if
any, of this Note, if lawful, and the payment or performance of all other
obligations of the Company under the Indenture (as defined below) or the Notes,
to the Holder of this Note and the Trustee, all in accordance with and subject
to the terms and limitations of this Note, Article Eleven of the Indenture
and this Guarantee.  This Guarantee will
become effective in accordance with Article Eleven of the Indenture and
its terms shall be evidenced therein. 
The validity and enforceability of any Guarantee shall not be affected
by the fact that it is not affixed to any particular Note.

 

Capitalized terms used but
not defined herein shall have the meanings ascribed to them in the amended and
restated Indenture dated as of September    , 2009, among
HUNTSMAN INTERNATIONAL LLC as issuer (the “Company”), each of the Guarantors
named therein and Wilmington Trust FSB, as trustee (the “Trustee”), as amended
or supplemented (the “Indenture”).

 

The obligations of the
undersigned to the Holders of Notes and to the Trustee pursuant to this
Guarantee and the Indenture are expressly set forth in Article Eleven of
the Indenture (including, without limitation, the applicable limitations on
this Guarantee as set forth in Section 11.02 of the Indenture and the
provisions relating to the release of this Guarantee as set forth in Section 11.04
of the Indenture) and reference is hereby made to the Indenture for the precise
terms of the Guarantee and all of the other provisions of the Indenture to
which this Guarantee relates.

 

THIS GUARANTEE SHALL BE
GOVERNED BY, AND CONSTRUED IN ACCORDANCE WITH, THE LAWS OF THE STATE OF NEW
YORK.  The undersigned Guarantor hereby
agrees to submit to the jurisdiction of the courts of the State of New York in
any action or proceeding arising out of or relating to this Guarantee.

 

This Guarantee is subject to
release upon the terms set forth in the Indenture.

 

E-1

 

IN WITNESS WHEREOF, each
Guarantor has caused its Guarantee to be duly executed.

 

	
  Date:

  	
   

  	
   

  

 

 

	
   

  	
  ,

  
	
   

  	
  as Guarantor

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
   

  
	
   

  	
   

  	
  Name:

  
	
   

  	
   

  	
  Title:

  

 

E-2Exhibit 4.1

 

EXECUTION
VERSION

 

FERRELLGAS, L.P.

FERRELLGAS FINANCE CORP.

 

9.125% SENIOR NOTES DUE 2017

 

INDENTURE

 

Dated as of September 14, 2009

 

U.S. Bank National Association

 

 

CROSS-REFERENCE TABLE*

 

	
  Trust Indenture

  Act Section

  	
   

  	
  Indenture Section

  
	
  310(a)(1)

  	
   

  	
  7.10

  
	
  (a)(2)

  	
  7.10

  
	
  (a)(3)

  	
  N.A.

  
	
  (a)(4)

  	
  N.A.

  
	
  (a)(5)

  	
  7.10

  
	
  (b)

  	
  7.10

  
	
  (c)

  	
  N.A.

  
	
  311(a)

  	
  7.11

  
	
  (b)

  	
  7.11

  
	
  (c)

  	
  N.A.

  
	
  312(a)

  	
  2.05

  
	
  (b)

  	
  11.03

  
	
  (c)

  	
  11.03

  
	
  313(a)

  	
  7.06

  
	
  (b)(1)

  	
  N.A.

  
	
  (b)(2)

  	
  7.06; 7.07

  
	
  (c)

  	
  7.06; 11.02

  
	
  (d)

  	
  7.06

  
	
  314(a)

  	
  4.03;11.02;
  11.05

  
	
  (b)

  	
  N.A.

  
	
  (c)(1)

  	
  11.04

  
	
  (c)(2)

  	
  11.04

  
	
  (c)(3)

  	
  N.A.

  
	
  (d)

  	
  N.A.

  
	
  (e)

  	
  11.05

  
	
  (f)

  	
  N.A.

  
	
  315(a)

  	
  7.01

  
	
  (b)

  	
  7.05, 11.02

  
	
  (c)

  	
  7.01

  
	
  (d)

  	
  7.01

  
	
  (e)

  	
  6.11

  
	
  316(a) (last
  sentence)

  	
  2.09

  
	
  (a)(1)(A)

  	
  6.05

  
	
  (a)(1)(B)

  	
  6.04

  
	
  (a)(2)

  	
  N.A.

  
	
  (b)

  	
  6.07

  
	
  (c)

  	
  2.12

  
	
  317(a)(1)

  	
  6.08

  
	
  (a)(2)

  	
  6.09

  
	
  (b)

  	
  2.04

  
	
  318(a)

  	
  11.01

  
	
  (b)

  	
  N.A.

  
	
  (c)

  	
  11.01

  

 

N.A. means not applicable.

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

 

2

 

TABLE OF CONTENTS

 

	
   

  	
  Page

  
	
  ARTICLE 1.

  	
   

  
	
  DEFINITIONS AND INCORPORATION

  	
   

  
	
  BY REFERENCE

  	
   

  
	
  Section 1.01

  	
  Definitions

  	
  1

  
	
  Section 1.02

  	
  Other Definitions

  	
  26

  
	
  Section 1.03

  	
  Incorporation by Reference of Trust Indenture Act

  	
  26

  
	
  Section 1.04

  	
  Rules of Construction

  	
  27

  
	
   

  	
   

  	
   

  
	
  ARTICLE 2.

  	
   

  
	
  THE NOTES

  	
   

  
	
   

  	
   

  	
   

  
	
  Section 2.01

  	
  Form and Dating

  	
  27

  
	
  Section 2.02

  	
  Execution and Authentication

  	
  28

  
	
  Section 2.03

  	
  Registrar and Paying Agent

  	
  28

  
	
  Section 2.04

  	
  Paying Agent to Hold Money in Trust

  	
  29

  
	
  Section 2.05

  	
  Holder Lists

  	
  29

  
	
  Section 2.06

  	
  Transfer and Exchange

  	
  29

  
	
  Section 2.07

  	
  Replacement Notes

  	
  43

  
	
  Section 2.08

  	
  Outstanding Notes

  	
  43

  
	
  Section 2.09

  	
  Treasury Notes

  	
  44

  
	
  Section 2.10

  	
  Temporary Notes

  	
  44

  
	
  Section 2.11

  	
  Cancellation

  	
  44

  
	
  Section 2.12

  	
  Defaulted Interest

  	
  44

  
	
  Section 2.13

  	
  CUSIP Numbers

  	
  45

  
	
   

  	
   

  	
   

  
	
  ARTICLE 3.

  	
   

  
	
  REDEMPTION AND PREPAYMENT

  	
   

  
	
   

  	
   

  	
   

  
	
  Section 3.01

  	
  Notices to Trustee

  	
  45

  
	
  Section 3.02

  	
  Selection of Notes to Be Redeemed or Purchased

  	
  45

  
	
  Section 3.03

  	
  Notice of Redemption

  	
  46

  
	
  Section 3.04

  	
  Effect of Notice of Redemption

  	
  47

  
	
  Section 3.05

  	
  Deposit of Redemption or Purchase Price

  	
  47

  
	
  Section 3.06

  	
  Notes Redeemed or Purchased in Part

  	
  47

  
	
  Section 3.07

  	
  Optional Redemption

  	
  47

  
	
  Section 3.08

  	
  Mandatory Redemption

  	
  48

  
	
  Section 3.09

  	
  Offer to Purchase by Application of Excess Proceeds

  	
  48

  
	
   

  	
   

  	
   

  
	
  ARTICLE 4.

  	
   

  
	
  COVENANTS

  	
   

  
	
   

  	
   

  	
   

  
	
  Section 4.01

  	
  Payment of Notes

  	
  50

  
	
  Section 4.02

  	
  Maintenance of Office or Agency

  	
  50

  
	
  Section 4.03

  	
  Reports

  	
  51

  
	
  Section 4.04

  	
  Compliance Certificate

  	
  51

  

 

i

 

	
  Section 4.05

  	
  Taxes

  	
  52

  
	
  Section 4.06

  	
  Stay, Extension and Usury Laws

  	
  52

  
	
  Section 4.07

  	
  Restricted Payments

  	
  52

  
	
  Section 4.08

  	
  Dividend and Other Payment Restrictions Affecting
  Subsidiaries

  	
  54

  
	
  Section 4.09

  	
  Incurrence of Indebtedness

  	
  55

  
	
  Section 4.10

  	
  Asset Sales

  	
  57

  
	
  Section 4.11

  	
  Transactions with Affiliates

  	
  59

  
	
  Section 4.12

  	
  Liens

  	
  60

  
	
  Section 4.13

  	
  Corporate
  Existence

  	
  60

  
	
  Section 4.14

  	
  Offer to Repurchase Upon Change of Control

  	
  60

  
	
  Section 4.15

  	
  Limitation
  on Finance Corp.

  	
  62

  
	
   

  	
   

  	
   

  
	
  ARTICLE 5.

  	
   

  
	
  SUCCESSORS

  	
   

  
	
   

  	
   

  	
   

  
	
  Section 5.01

  	
  Merger, Consolidation, or Sale of Assets

  	
  62

  
	
  Section 5.02

  	
  Successor Corporation Substituted

  	
  63

  
	
   

  	
   

  	
   

  
	
  ARTICLE 6.

  	
   

  
	
  DEFAULTS AND REMEDIES

  	
   

  
	
   

  	
   

  	
   

  
	
  Section 6.01

  	
  Events of Default

  	
  63

  
	
  Section 6.02

  	
  Acceleration

  	
  65

  
	
  Section 6.03

  	
  Other Remedies

  	
  65

  
	
  Section 6.04

  	
  Waiver of Past Defaults

  	
  66

  
	
  Section 6.05

  	
  Control by Majority

  	
  66

  
	
  Section 6.06

  	
  Limitation
  on Suits

  	
  66

  
	
  Section 6.07

  	
  Rights of Holders of Notes to Receive Payment

  	
  67

  
	
  Section 6.08

  	
  Collection Suit by Trustee

  	
  67

  
	
  Section 6.09

  	
  Trustee May File Proofs of Claim

  	
  67

  
	
  Section 6.10

  	
  Priorities

  	
  67

  
	
  Section 6.11

  	
  Undertaking for Costs

  	
  68

  
	
   

  	
   

  	
   

  
	
  ARTICLE 7.

  	
   

  
	
  TRUSTEE

  	
   

  
	
   

  	
   

  	
   

  
	
  Section 7.01

  	
  Duties of Trustee

  	
  68

  
	
  Section 7.02

  	
  Rights of Trustee

  	
  69

  
	
  Section 7.03

  	
  Individual Rights of Trustee

  	
  71

  
	
  Section 7.04

  	
  Trustee’s Disclaimer

  	
  71

  
	
  Section 7.05

  	
  Notice of Defaults

  	
  71

  
	
  Section 7.06

  	
  Reports by Trustee to Holders of the Notes

  	
  71

  
	
  Section 7.07

  	
  Compensation and Indemnity

  	
  71

  
	
  Section 7.08

  	
  Replacement of Trustee

  	
  72

  
	
  Section 7.09

  	
  Successor Trustee by Merger, etc.

  	
  73

  
	
  Section 7.10

  	
  Eligibility; Disqualification

  	
  73

  
	
  Section 7.11

  	
  Preferential Collection of Claims Against the
  Issuers

  	
  74

  

 

ii

 

	
  ARTICLE 8.

  	
   

  
	
  LEGAL DEFEASANCE AND COVENANT DEFEASANCE

  	
   

  
	
   

  	
   

  	
   

  
	
  Section 8.01

  	
  Option to Effect Legal Defeasance or Covenant
  Defeasance

  	
  74

  
	
  Section 8.02

  	
  Legal Defeasance and Discharge

  	
  74

  
	
  Section 8.03

  	
  Covenant
  Defeasance

  	
  75

  
	
  Section 8.04

  	
  Conditions to Legal or Covenant Defeasance

  	
  75

  
	
  Section 8.05

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

  	
  76

  
	
  Section 8.06

  	
  Repayment to the Issuers

  	
  77

  
	
  Section 8.07

  	
  Reinstatement

  	
  77

  
	
   

  	
   

  	
   

  
	
  ARTICLE 9.

  	
   

  
	
  AMENDMENT, SUPPLEMENT AND WAIVER

  	
   

  
	
   

  	
   

  	
   

  
	
  Section 9.01

  	
  Without Consent of Holders of Notes

  	
  77

  
	
  Section 9.02

  	
  With Consent of Holders of Notes

  	
  78

  
	
  Section 9.03

  	
  Compliance with Trust Indenture Act

  	
  79

  
	
  Section 9.04

  	
  Revocation and Effect of Consents

  	
  79

  
	
  Section 9.05

  	
  Notation on or Exchange of Notes

  	
  80

  
	
  Section 9.06

  	
  Trustee to Sign Amendments, etc.

  	
  80

  
	
   

  	
   

  	
   

  
	
  ARTICLE 10.

  	
   

  
	
  SATISFACTION AND DISCHARGE

  	
   

  
	
   

  	
   

  
	
  Section 10.01

  	
  Satisfaction and Discharge

  	
  80

  
	
  Section 10.02

  	
  Application of Trust Money

  	
  81

  
	
   

  	
   

  	
   

  
	
  ARTICLE 11.

  	
   

  
	
  MISCELLANEOUS

  	
   

  
	
   

  	
   

  	
   

  
	
  Section 11.01

  	
  Trust Indenture Act Controls

  	
  82

  
	
  Section 11.02

  	
  Notices

  	
  82

  
	
  Section 11.03

  	
  Communication by Holders of Notes with Other Holders
  of Notes

  	
  83

  
	
  Section 11.04

  	
  Certificate and Opinion as to Conditions Precedent

  	
  83

  
	
  Section 11.05

  	
  Statements Required in Certificate or Opinion

  	
  83

  
	
  Section 11.06

  	
  Rules by Trustee and Agents

  	
  84

  
	
  Section 11.07

  	
  Non-Recourse

  	
  84

  
	
  Section 11.08

  	
  No Personal Liability of Directors, Officers,
  Employees and Stockholders

  	
  84

  
	
  Section 11.09

  	
  Governing Law

  	
  84

  
	
  Section 11.10

  	
  Successors

  	
  84

  
	
  Section 11.11

  	
  Severability

  	
  85

  
	
  Section 11.12

  	
  Counterpart Originals

  	
  85

  
	
  Section 11.13

  	
  Table of Contents, Headings, etc.

  	
  85

  
	
  Section 11.14

  	
  Force
  Majeure

  	
  85

  
	
  Section 11.15

  	
  U.S.A. Patriot Act

  	
  85

  
	
   

  	
   

  	
   

  
	
  EXHIBITS

  	
   

  
	
   

  	
   

  	
   

  
	
  Exhibit A1

  	
  FORM OF
  NOTE

  	
   

  
	
  Exhibit A2

  	
  FORM OF
  REGULATION S TEMPORARY GLOBAL NOTE

  	
   

  
	
  Exhibit B

  	
  FORM OF
  CERTIFICATE OF TRANSFER

  	
   

  
	
  Exhibit C

  	
  FORM OF
  CERTIFICATE OF EXCHANGE

  	
   

  
	
  Exhibit D

  	
  FORM OF CERTIFICATE OF ACQUIRING INSTITUTIONAL
  ACCREDITED INVESTOR

  	
   

  

 

iii

 

This INDENTURE dated as of September 14,
2009 among Ferrellgas, L.P., a Delaware limited liability partnership (the “Company”), Ferrellgas Finance Corp., a
Delaware corporation (“Finance Corp.,”
and together with the Company, the “Issuers”),
and U.S. Bank National Association, as trustee (the “Trustee”).

 

The Issuers and the Trustee
agree as follows for the benefit of each other and for the equal and ratable
benefit of the Holders (as defined below) of the 9.125% Senior Notes due 2017 (the
“Notes”):

 

ARTICLE 1.

DEFINITIONS AND INCORPORATION

BY REFERENCE

 

Section 1.01           Definitions.

 

“144A
Global Note” means a Global Note substantially in the form of Exhibit A1
hereto bearing the Global Note Legend and the Private Placement Legend and
deposited with or on behalf of, and registered in the name of, the Depositary
or its nominee that will be issued in a denomination equal to the outstanding
principal amount of the Notes sold in reliance on Rule 144A.

 

“Accounts
Receivable Securitization” means a financing
arrangement involving the transfer or sale of accounts receivable of the
Partnership and its Restricted Subsidiaries in the ordinary course of business
through one or more SPEs, the terms of which arrangement do not impose (a) any
recourse or repurchase obligations upon the Partnership and its Restricted
Subsidiaries or any Affiliate of the Partnership and its Restricted
Subsidiaries (other than any such SPE) except to the extent of the breach of a
representation or warranty by the Partnership and its Restricted Subsidiaries
in connection therewith or (b) any negative pledge or Lien on any accounts
receivable not actually transferred to any such SPE in connection with such
arrangement.

 

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

 

“Affiliate” of any
specified Person means any other Person directly or indirectly controlling or
controlled by or under direct or indirect common control with such specified
Person. For purposes of this definition, “control,” as used with respect to any
Person, will mean the possession, directly or indirectly, of the power to direct
or cause the direction of the management or policies of such Person, whether
through the ownership of voting securities, by agreement or otherwise; provided that beneficial ownership of 10%
or more of the voting securities of a Person shall be deemed to be
control.  For purposes of this
definition, the terms “controlling,”
“controlled by” and “under common control with” will have
correlative meanings.

 

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

 

1

 

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

 

“Asset
Acquisition” means the following (in all cases, including assets
acquired through a Flow-Through Acquisition):

 

(1)           an Investment by the
Partnership or any Restricted Subsidiary of the Partnership in any other Person
pursuant to which the Person shall become a Restricted Subsidiary of the
Partnership, or shall be merged with or into the Partnership or any Restricted
Subsidiary of the Partnership;

 

(2)           the acquisition by the
Partnership or any Restricted Subsidiary of the Partnership of the assets of
any Person, other than a Restricted Subsidiary of the Partnership, which
constitute all or substantially all of the assets of such Person; or

 

(3)           the acquisition by the
Partnership or any Restricted Subsidiary of the Partnership of any division or
line of business of any Person, other than a Restricted Subsidiary of the
Partnership.

 

“Asset
Sale” means either of the following, whether in a single transaction or a
series of related transactions:

 

(1)           the sale, lease, conveyance
or other disposition of any assets other than (a) sales, leases or
transfers of assets in the ordinary course of business (including but not
limited to the sales of inventory in the ordinary course of business), and (b) sales
of accounts receivable under any Accounts Receivable Securitization; or

 

(2)           the issuance or sale of
Capital Stock of any direct Subsidiary.

 

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

 

(1)           any sale, lease or transfer
of assets or Capital Stock by the Partnership or any of its Restricted
Subsidiaries to the Issuers or a Restricted Subsidiary;

 

(2)           any sale or transfer of
assets or Capital Stock by the Partnership or any of its Restricted
Subsidiaries to any entity in exchange for other assets used in a related
business and/or cash (provided,
that such cash portion is at least 75% of the difference between the value of
the assets being transferred and the value of the assets being received) and
having a fair market value, as determined in good faith by an authorized
financial officer of the General Partner, reasonably equivalent to the fair
market value of the assets so transferred;

 

(3)           any sale, lease or transfer
of assets in accordance with Permitted Investments;

 

(4)           the sale, lease, conveyance
or other disposition of all or substantially all of the assets of the
Partnership; provided, that the
sale, lease, conveyance or other 

 

2

 

disposition of all or
substantially all of the assets of the Partnership will be governed by Section 4.14
hereof and/or Section 5.01 hereof and not Section 4.10 hereof;

 

(5)           the transfer or disposition
of assets that are permitted Restricted Payments;

 

(6)           any sale, lease or transfer
of assets pursuant to a sale and leaseback transaction, provided that the fair market value of all
assets so sold, leased or transferred shall not exceed $25 million from and
after the date of this Indenture;

 

(7)           sales or transfers of assets
not otherwise covered which do not generate proceeds in excess of $2.5 million;
and

 

(8)           sales or transfers of
accounts receivable under an Accounts Receivable Securitization.

 

“Available
Cash” as to any quarter means:

 

(1)           the sum of:

 

(a)  all cash receipts
of the Partnership during such quarter from all sources (including, without
limitation, distributions of cash received from Subsidiaries of the
Partnership, cash proceeds from Interim Capital Transactions, but excluding
cash proceeds from Termination Capital Transactions, and borrowings made under
the Credit Facilities); and

 

(b)  any reduction with
respect to such quarter in a cash reserve previously established pursuant to
clause (2)(b) below (either by reversal or utilization) from the level of
such reserve at the end of the prior quarter;

 

(2)           less the sum of:

 

(a)  all cash
disbursements of the Partnership during such quarter, including, without
limitation, disbursements for operating expenses, taxes, if any, debt service
(including, without limitation, the payment of principal, premium and interest),
redemption of Capital Stock of the Partnership, capital expenditures,
contributions, if any, to a Subsidiary and cash distributions to partners of
the Partnership (but only to the extent that such cash distributions to
partners exceed Available Cash for the immediately preceding quarter); and

 

(b)  any cash reserves
established with respect to such quarter, and any increase with respect to such
quarter in a cash reserve previously established pursuant to this clause (2)(b) from
the level of such reserve at the end of the prior quarter, in such amounts as
the General Partner determines in its reasonable discretion to be necessary or
appropriate (i) to provide for the proper conduct of the business of the
Partnership (including, without limitation, reserves for future capital
expenditures), (ii) to provide funds for distributions with respect to
Capital Stock of the Partnership in respect of any one or more of the next four
quarters or (iii) because the distribution of such amounts would be
prohibited by applicable law or by any loan agreement, security agreement, 

 

3

 

mortgage, debt instrument or other agreement
or obligation to which the Partnership is a party or by which it is bound or
its assets are subject;

 

(3)           plus the lesser of (a) an
amount as calculated in accordance with clauses (1) and (2) above for
the Partnership or its Restricted Subsidiaries for the first 45 days of the
quarter during which such Restricted Payment is made (rather than the quarter for
which clauses (1) and (2) were calculated) and (b) an amount of
working capital Indebtedness that the Partnership or its Restricted
Subsidiaries could have incurred on or before the 45th day after the last day
of the quarter used to calculate clauses (1) and (2) above;

 

provided, however, that Available Cash
attributable to any Restricted Subsidiary of the Partnership will be excluded
to the extent dividends or distributions of Available Cash by the Restricted
Subsidiary are not at the date of determination permitted by the terms of its
charter or any agreement, instrument, judgment, decree, order, statute, rule or
other regulation.

 

Notwithstanding
the foregoing, (x) disbursements (including, without limitation,
contributions to a Subsidiary or disbursements on behalf of a Subsidiary) made
or reserves established, increased or reduced after the end of any quarter but
on or before the date on which any Restricted Payment requiring a determination
of Available Cash for such quarter is made shall be deemed to have been made,
established, increased or reduced, for purposes of determining Available Cash,
with respect to such quarter if the General Partner so determines, and (y) “Available
Cash” shall not include any cash receipts or reductions in reserves or take
into account any disbursements made or reserves established in each case after
the date of liquidation of the Partnership. Taxes paid by the Partnership on
behalf of, or amounts withheld with respect to, all or less than all of the
partners shall not be considered cash disbursements of the Partnership that
reduce Available Cash, but the payment or withholding thereof shall be deemed
to be a distribution of Available Cash to the partners. Alternatively, in the
discretion of the General Partner, such taxes (if pertaining to all partners)
may be considered to be cash disbursements of the Partnership which reduce
Available Cash, but the payment or withholding thereof shall not be deemed to
be a distribution of Available Cash to such partners.

 

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

 

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

 

“Board of Directors” means:

 

(1)           with respect to a corporation,
the board of directors of the corporation;

 

4

 

(2)           with respect to a
partnership, the Board of Directors of the general partner of the partnership;
and

 

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

 

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

 

(1)           80% of the face amount of
all accounts receivable owned by the Partnership and its Subsidiaries as of the
end of the most recent month preceding such date that were not more than 90
days past due; plus

 

(2)           70% of the value of all
inventory owned by the Partnership and its Subsidiaries as of the end of the
most recent month preceding such date,

 

in each case, calculated on a consolidated basis and in accordance with
GAAP.

 

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

 

“Capital
Stock” means of any Person any capital stock, partnership interest,
membership interest, or equity interest of any kind.

 

“Change of Control” means

 

(1)           the sale, lease, conveyance
or other disposition of all or substantially all of the assets of the
Partnership to any entity other than to a Related Party;

 

(2)           the liquidation or
dissolution of the Partnership or the General Partner, or a successor to the
General Partner; or

 

(3)           any transaction or series of
transactions that results in a Person other than a Related Party beneficially
owning in the aggregate, directly or indirectly, more than 35% of the voting
stock of the General Partner or a successor to the General Partner and such
percentage is more than the percentage of voting stock that is owned by the
Related Party or a successor to the Related Party.

 

“Consolidated Cash Flow Available for Fixed Charges” means,
with respect to the Partnership and its Restricted Subsidiaries, for any
period, the sum of, without duplication, the amounts for the period, taken as
single accounting, of:

 

(1)           Consolidated Net Income;

 

(2)           Consolidated Non-cash
Charges;

 

(3)           Consolidated Interest
Expense; and

 

(4)           Consolidated Income Tax
Expense.

 

5

 

 

“Consolidated
Fixed Charge Coverage Ratio” means, with respect to the
Partnership and its Restricted Subsidiaries, the ratio of (y) the
aggregate amount of Consolidated Cash Flow Available for Fixed Charges of the
Person for the four full fiscal quarters immediately preceding the date of the
transaction (the “Transaction Date”) giving rise to the need to calculate the
Consolidated Fixed Charge Coverage Ratio (the “Four Quarter Period”), to (z) the
aggregate amount of Consolidated Fixed Charges of the Person for the Four
Quarter Period.  In addition to and
without limitation of the foregoing, for purposes of this definition, “Consolidated
Cash Flow Available for Fixed Charges” and “Consolidated Fixed Charges” shall
be calculated after giving effect on a pro forma basis for the period of the
calculation to, without duplication:

 

(1)           the incurrence or repayment
of any Indebtedness, excluding the incurrence of revolving credit borrowings
and repayments of revolving credit borrowings (other than the incurrence and
repayment of any revolving credit borrowings the proceeds of which are used for
Asset Acquisitions or Growth Related Capital Expenditures of the Partnership or
any of its Restricted Subsidiaries and, in the case of any incurrence or
revolving credit borrowings, the application of the net proceeds thereof)
during the period commencing on the first day of the Four Quarter Period to and
including the Transaction Date (the “Reference Period”), including, without
limitation, the incurrence of the Indebtedness giving rise to the need to make
the calculation (and the application of the net proceeds thereof), as if the
incurrence (and application) occurred on the first day of the Reference Period;
and

 

(2)           any Asset Sales or Asset
Acquisitions (including, without limitation, any Asset Acquisition giving rise
to the need to make the calculation as a result of the Partnership or one of
its Restricted Subsidiaries, including any Person who becomes a Restricted
Subsidiary as a result of the Asset Acquisition, incurring, assuming or
otherwise being liable for Acquired Indebtedness) occurring during the
Reference Period, as if the Asset Sale or Asset Acquisition occurred on the
first day of the Reference Period; provided,
however, that:

 

(a)  Consolidated Fixed
Charges will be reduced by amounts attributable to businesses or assets that
are so disposed of only to the extent that the obligations giving rise to such
Consolidated Fixed Charges would no longer be obligations contributing to the
Consolidated Fixed Charges subsequent to the date of determination of the
Consolidated Fixed Charge Coverage Ratio;

 

(b)  Consolidated Cash
Flow Available for Fixed Charges generated by an acquired business or asset
shall be determined by the actual gross profit, which is equal to revenues
minus cost of goods sold, of the acquired business or asset during the
immediately available preceding four full fiscal quarters occurring in the
Reference Period, minus the pro forma expenses that would have been incurred by
the Partnership and its Restricted Subsidiaries in the operation of the
acquired business or asset during the period computed on the basis of personnel
expenses for employees retained or to be retained by the Partnership and its
Restricted Subsidiaries in the operation of the acquired business or asset and
non-personnel costs and expenses incurred by or to be incurred by the
Partnership and its Restricted Subsidiaries based upon the operation of the
Partnership’s business, all as determined in good faith by an authorized
financial officer of the General Partner; and

 

6

 

(c)  Consolidated Cash
Flow Available for Fixed Charges shall not include the impact of any
nonrecurring cash charges incurred in connection with a restructuring, reorganization
or other similar transaction, as determined in good faith by an authorized
financial officer of the General Partner.

 

Furthermore,
subject to the following paragraph, in calculating “Consolidated Fixed Charges”
for purposes of determining the “Consolidated Fixed Charge Coverage Ratio”:

 

(1)           interest on outstanding
Indebtedness, other than Indebtedness referred to in the point below,
determined on a fluctuating basis as of the last day of the Four Quarter Period
and which will continue to be so determined thereafter shall be deemed to have
accrued at a fixed rate per annum equal to the rate of interest on such
Indebtedness in effect on that date;

 

(2)           only actual interest
payments associated with Indebtedness incurred in accordance with clause (4) of
the definition of Permitted Indebtedness and all Permitted Refinancing
Indebtedness in respect thereof, during the Four Quarter Period shall be
included in the calculation; and

 

(3)           if interest on any
Indebtedness actually incurred on the date may optionally be determined at an
interest rate based upon a factor of a prime or similar rate, a eurocurrency
interbank offered rate, or other rates, then the interest rate in effect on the
last day of the Four Quarter Period will be deemed to have been in effect
during the period.

 

“Consolidated Fixed Charges” means, with respect to the
Partnership and its Restricted Subsidiaries for any period, the sum of, without
duplication:

 

(1)           the amounts for such period
of Consolidated Interest Expense; and

 

(2)           the product of:

 

(a)  the aggregate
amount of dividends and other distributions paid or accrued during the period
in respect of Preferred Stock and Redeemable Capital Stock of the Partnership
and its Restricted Subsidiaries on a consolidated basis; and

 

(b)  a fraction, the
numerator of which is one and the denominator of which is one less the then
applicable current combined federal, state and local statutory tax rate,
expressed as a percentage.

 

“Consolidated Income Tax Expense” means, with respect to the
Partnership and its Restricted Subsidiaries for any period, the provision for
federal, state, local and foreign income taxes of the Partnership and its
Restricted Subsidiaries for the period as determined on a consolidated basis in
accordance with GAAP.

 

“Consolidated Interest Expense” means, with respect to the
Partnership and its Restricted Subsidiaries, for any period, without
duplication, the sum of:

 

7

 

(1)           the interest expense of the
Partnership and its Restricted Subsidiaries for the period as determined on a
consolidated basis in accordance with GAAP, including, without limitation:

 

(2)           any amortization of debt
discount;

 

(3)           the net cost under Interest
Rate Agreements;

 

(4)           the interest portion of any
deferred payment obligation;

 

(5)           all commissions, discounts
and other fees and charges owed with respect to letters of credit and bankers’
acceptance financing;

 

(6)           all accrued interest for all
instruments evidencing Indebtedness; and

 

(7)           the interest component of
Capital Leases paid or accrued or scheduled to be paid or accrued by the
Partnership and its Restricted Subsidiaries during the period as determined on
a consolidated basis in accordance with GAAP.

 

“Consolidated Net Income” means the net income of the
Partnership and its Restricted Subsidiaries, as determined on a consolidated
basis in accordance with GAAP and as adjusted to exclude:

 

(1)           net after-tax extraordinary
gains or losses;

 

(2)           net after-tax gains or
losses attributable to Asset Sales or sales of receivables under any Accounts
Receivable Securitization;

 

(3)           the net income or loss of
any Person which is not a Restricted Subsidiary and which is accounted for by
the equity method of accounting; provided,
that Consolidated Net Income shall include the amount of dividends or
distributions actually paid to the Partnership or any Restricted Subsidiary;

 

(4)           the net income or loss prior
to the date of acquisition of any Person combined with the Partnership or any
Restricted Subsidiary in a pooling of interest;

 

(5)           the net income of any
Restricted Subsidiary to the extent that dividends or distributions of that net
income are not at the date of determination permitted by the terms of its
charter or any judgment, decree, order, statute, rule or other regulation;
and

 

(6)           the cumulative effect of any
changes in accounting principles.

 

“Consolidated Net Tangible Assets” means as of any date of
determination, the Total Assets of the Partnership and the Restricted
Subsidiaries as would be shown on a consolidated balance sheet of the
Partnership and the Restricted Subsidiaries prepared in accordance with GAAP as
of that date less applicable reserves reflected in such balance sheet, after
deducting the following amounts: (a) all current liabilities reflected in
such balance sheet, and (b) all goodwill, trademarks, patents, unamortized
debt discounts and expenses and other like intangibles reflected in such
balance sheet.

 

8

 

“Consolidated Non-Cash Charges” means, with respect to the
Partnership and its Restricted Subsidiaries for any period, the aggregate (1) depreciation,
(2) amortization,  (3) non-cash
employee compensation expenses of the Partnership or its Restricted
Subsidiaries for such period, and (4) any non-cash charges resulting from
writedowns of non-current assets, in each case which reduces the Consolidated
Net Income of the Partnership and its Restricted Subsidiaries for the period,
as determined on a consolidated basis in accordance with GAAP.

 

“Corporate Trust Office of the Trustee” will be at the
address of the Trustee specified in Section 11.02 hereof or such other
address as to which the Trustee may give notice to the Issuers.

 

“Credit
Agreement” means that Fifth Amended and Restated Credit
Agreement, dated as of April 22, 2005, among the Partnership, the General
Partner, Bank of America, N.A., as agent, and the other financial institutions
party thereto as heretofore amended (as amended, the “Existing Credit Agreement”), as the Existing
Credit Agreement may be amended, restated, modified, renewed, refunded,
replaced or refinanced from time to time.

 

“Credit
Facilities” means, one or more debt facilities (including,
without limitation, the facilities evidenced by the Credit Agreement) or
commercial paper facilities, or indentures, in each case with banks or other
institutional lenders providing for revolving credit loans, term loans,
receivables financing (including through the sale of receivables to such
lenders or to special purpose entities formed to borrow from such lenders
against such receivables) or letters of credit, in each case, as amended,
restated, modified, renewed, refunded, replaced or refinanced in whole or in
part from time to time.

 

“Custodian” means the
Trustee, as custodian with respect to the Notes in global form, or any
successor entity thereto.

 

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

 

“Definitive
Note” means a certificated Note registered in the name of the Holder thereof
and issued in accordance with Section 2.06 hereof, substantially in the
form of Exhibit A hereto except that such Note shall not bear the Global
Note Legend and shall not have the “Schedule of Exchanges of Interests in the
Global Note” attached thereto.

 

“Depositary” means, with
respect to the Notes issuable or issued in whole or in part in global form, the
Person specified in Section 2.03 hereof as the Depositary with respect to
the Notes, and any and all successors thereto appointed as depositary hereunder
and having become such pursuant to the applicable provision of this Indenture.

 

“Designation Amount” means, with respect to the designation
of a Restricted Subsidiary or a newly acquired or formed Subsidiary as an Unrestricted
Subsidiary, an amount equal to the sum of:

 

(1)           the net book value of all
assets of the Subsidiary at the time of the designation in the case of a
Restricted Subsidiary; and

 

9

 

(2)           the cost of acquisition or
formation in the case of a newly acquired or formed Subsidiary.

 

“Equity
Offering” means a public offering or private placement of
partnership interests (other than interests that are mandatorily redeemable)
of:

 

(3)           any entity that directly or
indirectly owns equity interests in the Partnership, to the extent the net
proceeds are contributed to the Partnership;

 

(4)           any Subsidiary of the
Partnership to the extent the net proceeds are distributed, paid, lent or
otherwise transferred to the Partnership that results in the net proceeds to
the Partnership of at least $20 million; or

 

(5)           the Partnership.

 

A private placement of partnership interests
will not be deemed an Equity Offering unless net proceeds of at least $20
million are received.

 

“Euroclear” means
Euroclear Bank, S.A./N.V., as operator of the Euroclear system.

 

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

 

“Exchange
Notes” means the Notes issued in the Exchange Offer, if any, pursuant to Section 2.06(f) hereof.

 

“Exchange
Offer” has the meaning set forth in the Registration Rights Agreement.

 

“Exchange
Offer Registration Statement” has the meaning set forth
in the Registration Rights Agreement.

 

“Ferrellgas
Partners” means  Ferrellgas
Partners, L.P.

 

“Flow-Through
Acquisition” means an acquisition by the General Partner or its
parent from a Person that is not an Affiliate of the General Partner, its
parent or the Partnership, of property (real or personal), assets or equipment
(whether through the direct purchase of assets or the Capital Stock of the
Person owning such assets) in a permitted line of business, which is promptly
sold, transferred or contributed by the General Partner or its parent to the
Partnership or one of its Subsidiaries.

 

“GAAP” means generally
accepted accounting principles set forth in the opinions and pronouncements of
the Accounting Principles Board of the American Institute of Certified Public
Accountants and statements and pronouncements of the Financial Accounting
Standards Board or in such other statements by such other entity as have been
approved by a significant segment of the accounting profession, in each case,
which are in effect on the date of this Indenture.

 

“General
Partner” means Ferrellgas, Inc.

 

“Global
Notes” means, individually and collectively, each of the Restricted Global
Notes and the Unrestricted Global Notes deposited with or on behalf of and
registered in the name of 

 

10

 

the
Depositary or its nominee, substantially in the form of Exhibit A1 hereto
and that bears the Global Note Legend and that has the “Schedule of Exchanges
of Interests in the Global Note” attached thereto, issued in accordance with Section 2.01,
2.06(b)(3), 2.06(b)(4), 2.06(d)(2) or 2.06(g)(2) hereof.

 

“Global
Note Legend” means the legend set forth in Section 2.06(g)(2),
which is required to be placed on all Global Notes issued under this Indenture.

 

“Government
Securities” means direct obligations of, or obligations
guaranteed by, the United States of America, and the payment for which the
United States pledges its full faith and credit.

 

“Growth
Related Capital Expenditures” means, with respect to any
Person, all capital expenditures by such Person made to improve or enhance the
existing capital assets or to increase the customer base of such Person or to
acquire or construct new capital assets (but excluding capital expenditures
made to maintain, up to the level thereof that existed at the time of such
expenditure, the operating capacity of the capital assets of such Person as
such assets existed at the time of such expenditure).

 

“Holder” means a Person
in whose name a Note is registered.

 

“IAI
Global Note” means a Global Note substantially in the form of Exhibit A1
hereto bearing the Global Note Legend and the Private Placement Legend and
deposited with or on behalf of and registered in the name of the Depositary or
its nominee that will be issued in a denomination equal to the outstanding
principal amount of the Notes sold to Institutional Accredited Investors.

 

“Indebtedness” means, as
applied to any Person, without duplication:

 

(1)           (a) any indebtedness
for borrowed money and (b) all obligations evidenced by any (i) bond,
note, debenture or other similar instrument or (ii) letter of credit, or
reimbursement agreements in respect thereof, but only for any drawings that are
not reimbursed within five Business Days after the date of such drawings, which
in each case the Person has, directly or indirectly, created, incurred or
assumed;

 

(2)           any indebtedness for
borrowed money and all obligations evidenced by any bond, note, debenture or
other similar instrument secured by any Lien in respect of property owned by
the Person, whether or not the Person has assumed or become liable for the
payment of the indebtedness; provided,
that the amount of the indebtedness, if the Person has not assumed the same or
become liable therefor, shall in no event be deemed to be greater than the fair
market value from time to time, as determined in good faith by the Person of
the property subject to the Lien;

 

(3)           any indebtedness, whether or
not for borrowed money (excluding trade payables and accrued expenses arising
in the ordinary course of business) with respect to which the Person has become
directly or indirectly liable and which represents the deferred purchase price,
or a portion thereof, or has been incurred to finance the purchase 

 

11

 

price, or a portion thereof,
of any property or business acquired by, or service performed on behalf of, the
Person, whether by purchase, consolidation, merger or otherwise;

 

(4)           the principal component of
any obligations under Capital Leases to the extent the obligations would, in
accordance with GAAP, appear on the balance sheet of the Person;

 

(5)           any indebtedness of any
other Person of the character referred to in the foregoing clauses (1)-(4) of
this definition with respect to which the Person whose indebtedness is being
determined has become liable by way of a guarantee; and

 

(6)           all Redeemable Capital Stock
of the Person valued at the greater of its voluntary or involuntary maximum
fixed repurchase price plus accrued dividends.

 

For purposes hereof, the “maximum fixed
repurchase price” of any Redeemable Capital Stock which does not have a fixed
repurchase price shall be calculated in accordance with the terms of the
Redeemable Capital Stock as if it were purchased on any date on which
Indebtedness shall be required to be determined pursuant to this Indenture and
if the price is based upon, or measured by, the fair market value of the
Redeemable Capital Stock, the fair market value shall be determined in good
faith by the Board of Directors of the issuer of the Redeemable Capital
Stock.  For purposes hereof, the term “Indebtedness”
shall not include (x) accrual of interest, the accretion of accreted value
and the payment of interest or any other similar incurrence by the Partnership
or its Restricted Subsidiaries related to Indebtedness otherwise permitted in
this Indenture, (y) Indebtedness under any hedging arrangement which
provides for the right or obligation to purchase, sell or deliver any currency,
commodity or security at a future date for a specified price entered into to
protect such Person from fluctuations in prices or rates, including currencies,
interest rates, commodity prices, and securities prices, including without
limitation indebtedness under any interest rate or commodity price swap
agreement, interest rate cap agreement, interest rate collar agreement or any
forward sales arrangements, calls, options, swaps, or other similar
transactions or any combination thereof, including, or (z) any Accounts
Receivable Securitization.

 

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

 

“Indirect
Participant” means a Person who holds a beneficial interest in a
Global Note through a Participant.

 

“Initial
Notes” means the first $300,000,000 aggregate principal amount of Notes
issued under this Indenture on the date hereof.

 

“Initial
Purchasers” means J.P. Morgan Securities Inc., Banc of America
Securities LLC, Wells Fargo Securities, LLC, BNP Paribas Securities Corp.,
Fifth Third Securities, Inc., PNC Capital Markets LLC and SG Americas
Securities, LLC.

 

“Interim
Capital Transactions” means (1) borrowings, refinancings or
refundings of Indebtedness and sales of debt securities (other than for working
capital purposes and other than for items purchased on open account in the
ordinary course of business) by the Partnership, (2) sales of Capital Stock
of the Partnership by the Partnership and (3) sales or other voluntary or 

 

12

 

involuntary
dispositions of any assets of the Partnership (other than (x) sales or
other dispositions of inventory in the ordinary course of business, (y) sales
or other dispositions of other current assets including, without limitation,
receivables and accounts and (z) sales or other dispositions of assets as
a part of normal retirements or replacements), in each case prior to the
commencement of the dissolution and liquidation of the Partnership.

 

“Investment” means as
applied to any Person:

 

(1)           any direct or indirect
purchase or other acquisition by the Person of stock or other securities of any
other Person; or

 

(2)           any direct or indirect loan,
advance or capital contribution by the Person to any other Person and any other
item which would be classified as an “investment” on a balance sheet of the
Person prepared in accordance with GAAP, including without limitation any direct
or indirect contribution by the Person of property or assets to a joint
venture, partnership or other business entity in which the Person retains an
interest, it being understood that a direct or indirect purchase or other
acquisition by the Person of assets of any other Person, other than stock or
other securities, shall not constitute an “Investment” for purposes of this
Indenture.

 

The amount classified as Investments made
during any period will be the aggregate cost to the Partnership and its Restricted
Subsidiaries of all the Investments made during the period, determined in
accordance with GAAP, but without regard to unrealized increases or decreases
in value, or write-ups, write-downs or write-offs, of the Investments and
without regard to the existence of any undistributed earnings or accrued
interest with respect thereto accrued after the respective dates on which the
Investments were made, less any net return of capital realized during the
period upon the sale, repayment or other liquidation of the Investments,
determined in accordance with GAAP, but without regard to any amounts received
during the period as earnings (in the form of dividends not constituting a
return of capital, interest or otherwise) on the Investments or as loans from
any Person in whom the Investments have been made.

 

“Legal Holiday” means a Saturday, a Sunday or a day on which
banking institutions in the City of New York or at a place of payment are
authorized by law, regulation or executive order to remain closed.  If a payment date is a Legal Holiday at a
place of payment, payment may be made at that place on the next succeeding day
that is not a Legal Holiday, and no interest shall accrue on such payment for
the intervening period.

 

“Lien” means, with
respect to any asset, any mortgage, lien (statutory or otherwise), pledge,
charge, security interest, hypothecation, assignment for security or other
encumbrance of any kind in respect of such asset.  A Person shall be deemed to own subject to a
Lien any asset which such Person has acquired or holds subject to the interest
of a vendor or lessor under any conditional sale agreement, capital lease or
other title retention agreement.

 

“Net
Amount of Unrestricted Investment” means, without duplication,
the sum of:

 

(1)           the aggregate amount of all
Investments made after the date of this Indenture pursuant to clause (3) of
the definition of Permitted Investment hereto, computed as provided in the last
sentence of the definition of Investment herein; and

 

13

 

(2)           the aggregate of all
Designation Amounts in connection with the designation of Unrestricted
Subsidiaries, less all Designation Amounts in respect of Unrestricted
Subsidiaries which have been designated as Restricted Subsidiaries and
otherwise reduced in a manner consistent with the provisions of the last
sentence of the definition of Investment herein.

 

“Net Proceeds” means, with respect to any asset sale or sale
of Capital Stock, the proceeds therefrom in the form of cash or cash
equivalents including payments in respect of deferred payment obligations when
received in the form of cash or cash equivalents, except to the extent that the
deferred payment obligations are financed or sold with recourse to the
Partnership or any of its Restricted Subsidiaries, net of:

 

(1)           brokerage commissions and
other fees and expenses related to the Asset Sale, including, without
limitation, fees and expenses of legal counsel and accountants and fees,
expenses, discounts or commissions of underwriters, placement agents and
investment bankers;

 

(2)           provisions for all taxes
payable as a result of the Asset Sale;

 

(3)           amounts required to be paid
to any Person, other than the Partnership or any Restricted Subsidiary of the
Partnership, owning a beneficial interest in the assets subject to the Asset
Sale;

 

(4)           appropriate amounts to be
provided by the Partnership or any Restricted Subsidiary of the Partnership, as
the case may be, as a reserve required in accordance with GAAP against any
liabilities associated with the Asset Sale and retained by the Partnership or
any Restricted Subsidiary of the Partnership, as the case may be, after the
Asset Sale, including, without limitation, pension and other post-employment
benefit liabilities, liabilities related to environmental matters and
liabilities under any indemnification obligations associated with the Asset
Sale; and

 

(5)           amounts applied to the
repayment of Indebtedness in connection with the asset or assets acquired in
the Asset Sale, including any transaction costs and expenses associated
therewith and any make-whole or other premium owed in connection with such
repayment.

 

“Notes” has the
meaning assigned to it in the preamble to this Indenture.  The Initial Notes, the Additional Notes and
the Exchange Notes shall be treated as a single class for all purposes under
this Indenture, and unless the context otherwise requires, all references to
the Notes shall include the Initial Notes, any Additional Notes and the
Exchange Notes.

 

“Officer” means, with respect
to any Person, the Chairman of the Board, the Chief Executive Officer, the
President, the Chief Operating Officer, the Chief Financial Officer, the
Treasurer, any Assistant Treasurer, the Controller, the Secretary or any
Vice-President of such Person.

 

“Officers’
Certificate” means a certificate signed on behalf of the Issuers
by two Officers of the Issuers, one of whom must be the principal executive
officer, the principal financial officer 

 

14

 

or
the principal accounting officer of the Issuers, that meets the requirements of
Section 11.05 hereof.

 

“Opinion
of Counsel” means an opinion from legal counsel who is
reasonably acceptable to the Trustee, that meets the requirements of Section 11.05
hereof.  The counsel may be an employee
of or counsel to the Issuers, any Subsidiary of the Issuers or the Trustee.

 

“Participant” means, with
respect to the Depositary, a Person who has an account with the Depositary.

 

“Partnership” means
Ferrellgas, L.P., without its consolidated subsidiaries.

 

“Permitted
Investments” means any of the following:

 

(1)           Investments made or owned by
the Partnership or any Restricted Subsidiary in:

 

(a)  marketable
obligations issued or unconditionally guaranteed by the United States, or
issued by any agency thereof and backed by the full faith and credit of the
United States, in each case maturing one year or less from the date of
acquisition thereof;

 

(b)  marketable direct
obligations issued by any state of the United States or any political
subdivision of any such state or any public instrumentality thereof maturing
within one year from the date of acquisition thereof and having as at such date
the highest rating obtainable from either Standard & Poor’s Ratings
Group (“S&P”) and its successors or Moody’s Investors Service, Inc. (“Moody’s”)
and its successors;

 

(c)  commercial paper
maturing no more than 270 days from the date of creation thereof and having as
at the date of acquisition thereof one of the two highest ratings obtainable
from either S&P or Moody’s;

 

(d)  certificates of
deposit maturing one year or less from the date of acquisition thereof issued
by commercial banks incorporated under the laws of the United States or any
state thereof or the District of Columbia or Canada;

 

(e)  the commercial
paper or other short term unsecured debt obligations of which are as at such
date rated either “A-2” or better (or comparably if the rating system is
changed) by S&P or “Prime-2” or better (or comparably if the rating system
is changed) by Moody’s;

 

(f)  the long-term debt
obligations of which are, as at such date, rated either “A” or better (or
comparably if the rating system is changed) by either S&P or Moody’s (“Permitted
Banks”);

 

(g)  eurodollar time
deposits having a maturity of less than 270 days from the date of acquisition
thereof purchased directly from any Permitted Bank;

 

15

 

 

 

 

(h)  bankers’
acceptances eligible for rediscount under requirements of the Board of
Governors of the Federal Reserve System and accepted by Permitted Banks; and

 

(i)  obligations of the
type described in clauses (a) through (e) above purchased from a securities
dealer designated as a “primary dealer” by the Federal Reserve Bank of New York
or from a Permitted Bank as counterparty to a written repurchase agreement
obligating such counterparty to repurchase such obligations not later than 14
days after the purchase thereof and which provides that the obligations which
are the subject thereof are held for the benefit of the Partnership or a
Restricted Subsidiary by a custodian which is a Permitted Bank and which is not
a counterparty to the repurchase agreement in question;

 

(2)                                  the acquisition
by the Partnership or any Restricted Subsidiary of Capital Stock or other
ownership interests, whether in a single transaction or in a series of related
transactions, of a Person located in the United States, Mexico or Canada and
engaged in substantially the same business as the Partnership such that, upon
the completion of such transaction or series of transactions, the Person
becomes a Restricted Subsidiary;

 

(3)                                  any Investment
by the Partnership or any Restricted Subsidiary in a Person, if as a result of
such Investment:

 

(a)          such Person becomes a
Restricted Subsidiary; or

 

(b)         such Person is merged,
consolidated or amalgamated with or into, or transfers or conveys substantially
all of its properties or assets to, or is liquidated into, the Partnership or a
Restricted Subsidiary;

 

(4)                                  the making or
ownership by the Partnership or any Restricted Subsidiary of Investments (in
addition to any other Permitted Investments) in any Person incorporated or
otherwise formed pursuant to the laws of the United States, Mexico or Canada or
any state thereof which is engaged in the United States, Mexico or Canada; provided, that the aggregate amount of all
such Investments made by the Partnership and its Restricted Subsidiaries
following the date of this Indenture and outstanding pursuant to this third
clause shall not at any date of determination exceed 7.5% of Total Assets;

 

(5)                                  the making or
ownership by the Partnership or any Restricted Subsidiary of Investments:

 

(a)  arising out of
loans and advances to employees incurred in the ordinary course of business;

 

(b)  arising out of
extensions of trade credit or advances to third parties in the ordinary course
of business; or

 

(c)  acquired by reason
of the exercise of customary creditors’ rights upon default or pursuant to the
bankruptcy, insolvency or reorganization of a debtor;

 

16

 

(6)                                  the creation or
incurrence of liability by the Partnership or any Restricted Subsidiary, with
respect to any guarantee constituting an obligation, warranty or indemnity, not
guaranteeing Indebtedness of any Person, which is undertaken or made in the
ordinary course of business;

 

(7)                                  the creation or
incurrence of liability by the Partnership or any Restricted Subsidiary with
respect to any hedging agreements or arrangements;

 

(8)                                  the making by
any Restricted Subsidiary of Investments in the Partnership or another
Restricted Subsidiary and the making by the Partnership of Investments in any
Restricted Subsidiary;

 

(9)                                  the present
value, determined on the basis of the implicit interest rate, of all basic
rental obligations under all synthetic leases of the Partnership or any
Restricted Subsidiary; and

 

(10)                            the creation or
incurrence of liability by the Partnership or any Restricted Subsidiary or the
making or ownership by the Partnership or any Restricted Subsidiary of
Investments in any Person with respect to any Accounts Receivable
Securitization.

 

“Permitted
Liens” means any of the following:

 

(1)                                  Liens for
taxes, assessments or other governmental charges, the payment of which is not
yet due or the payment of which is being contested in good faith by appropriate
proceedings promptly initiated and diligently conducted and as to which
reserves or other appropriate provision, if any, as shall be required by GAAP,
shall have been made therefor and be adequate in the good faith judgment of the
obligor;

 

(2)                                  Liens of
carriers, vendors, warehousemen, mechanics, materialmen, repairmen and other
like Liens incurred in the ordinary course of business for sums not overdue for
a period of more than 30 days or the payment of which is being contested in
good faith by appropriate proceedings promptly initiated and diligently
conducted and as to which reserves or other appropriate provisions, if any, as
shall be required by GAAP, shall have been made therefor and be adequate in the
good faith judgment of the obligor, in each case:

 

(a)  not incurred or
made in connection with the borrowing of money, the obtaining of advances or
credit or the payment of the deferred purchase price of property; or

 

(b)  incurred in the
ordinary course of business securing the unpaid purchase price of property or
services constituting current accounts payable;

 

(3)                                  Liens, other
than any Lien imposed by the Employee Retirement Income Security Act of 1974,
as may be amended from time to time, incurred or deposits made in the ordinary
course of business:

 

(a)  in connection with
workers’ compensation, unemployment insurance and other types of social
security; or

 

17

 

(b)  to secure or to
obtain letters of credit that secure the performance of tenders, statutory
obligations, surety and appeal bonds, bids, leases, performance bonds,
purchase, construction or sales contracts and other similar obligations, in
each case not incurred or made in connection with the borrowing of money;

 

(4)                                  other deposits
made to secure liability to insurance carriers under insurance or
self-insurance arrangements;

 

(5)                                  Liens securing
reimbursement obligations under letters of credit, provided in each case that
such Liens cover only the title documents and related goods and any proceeds
thereof covered by the related letter of credit;

 

(6)                                  any attachment
or judgment Lien, unless the judgment it secures shall not, within 60 days
after the entry thereof, have been discharged or execution thereof stayed
pending appeal or review, or shall not have been discharged within 60 days
after expiration of any such stay;

 

(7)                                  leases or
subleases granted to others, easements, rights-of-way, restrictions and other
similar charges or encumbrances, which, in each case either are granted,
entered into or created in the ordinary course of the business of the
Partnership or any Restricted Subsidiary or do not materially impair the value
or intended use of the property covered thereby;

 

(8)                                  Liens on
property or assets of any Restricted Subsidiary securing Indebtedness of the
Restricted Subsidiary owing to the Partnership or a Restricted Subsidiary;

 

(9)                                  Liens on assets
of the Partnership or any Restricted Subsidiary existing on the date of this
Indenture;

 

(10)                            Liens on
personal property leased under leases entered into by the Partnership or its
Restricted Subsidiaries which are accounted for as operating leases in
accordance with GAAP;

 

(11)                            Liens securing
Indebtedness arising under an Accounts Receivable Securitization (including the
filing of any related financing statements naming the Partnership or any
Restricted Subsidiary as the debtor thereunder in connection with the sale of
accounts receivable by the Partnership, Ferrellgas, L.P. or any Restricted
Subsidiary to an SPE in connection with any such permitted Accounts Receivable
Securitization);

 

(12)                            Liens securing
Indebtedness incurred in accordance with:

 

(a)  clauses (3) and
(6) of the definition of Permitted Indebtedness; and

 

(b)  Indebtedness
otherwise permitted to be incurred under Section 4.09 hereof to the extent
incurred:

 

18

 

(i)                                     to finance the
making of expenditures for the improvement or repair (to the extent the
improvements and repairs may be capitalized on the books of the Partnership and
the Restricted Subsidiaries in accordance with GAAP) of, or additions including
additions by way of acquisitions of businesses and related assets to, the
assets and property of the Partnership and its Restricted Subsidiaries; or

 

(ii)                                  by assumption
in connection with additions including additions by way of acquisition or
capital contributions of businesses and related assets to the property and
assets of the Partnership and its Restricted Subsidiaries;

 

provided, that, in the case of
Indebtedness incurred in accordance with clauses (i) and (ii) above,
the principal amount of the Indebtedness does not exceed the lesser of the cost
to the Partnership and its Restricted Subsidiaries of the additional property
or assets and the fair market value of the additional property or assets at the
time of the acquisition thereof, as determined in good faith by an authorized
financial officer of the General Partner;

 

(13)                            Liens existing
on any property of any Person at the time it becomes a Subsidiary of the
Partnership, or existing at the time of acquisition upon any property acquired
by the Partnership or any Subsidiary through purchase, merger or consolidation
or otherwise, whether or not assumed by the Partnership or the Subsidiary, or
created to secure Indebtedness incurred to pay all or any part of the purchase
price (a “Purchase Money Lien”) of property including, without limitation,
Capital Stock and other securities acquired by the Partnership or a Restricted
Subsidiary; provided, that:

 

(a)  the Lien shall be
confined solely to the item or items of property and, if required by the terms
of the instrument originally creating the Lien, other property which is an
improvement to or is acquired for use specifically in connection with the
acquired property;

 

(b)  in the case of a
Purchase Money Lien, the principal amount of the Indebtedness secured by the
Purchase Money Lien shall at no time exceed an amount equal to the lesser of:

 

(A) the cost to the
Partnership and the Restricted Subsidiaries of the property; and

 

(B) the fair market
value of the property at the time of the acquisition thereof as determined in
good faith by an authorized financial officer of the General Partner;

 

(c)  the Purchase Money
Lien shall be created not later than 360 days after the acquisition of the
property; and

 

(d)  the Lien, other
than a Purchase Money Lien, shall not have been created or assumed in
contemplation of the Person’s becoming a Subsidiary of the Partnership or the
acquisition of property by the Partnership or any Subsidiary;

 

19

 

(14)                            easements,
exceptions or reservations in any property of the Partnership or any Restricted
Subsidiary granted or reserved for the purpose of pipelines, roads, the removal
of oil, gas, coal or other minerals, and other like purposes, or for the joint
or common use of real property, facilities and equipment, which are incidental
to, and do not materially interfere with, the ordinary conduct of the business
of the Partnership or any Restricted Subsidiary;

 

(15)                            Liens arising
from or constituting permitted encumbrances under the agreements and
instruments securing the obligations under the Credit Agreement;

 

(16)                            Liens of
landlords or mortgages of landlords on fixtures and movable property located on
premises leased by the Partnership or any of its Subsidiaries in the ordinary
course of business;

 

(17)                            Liens such as
banker’s liens, rights of set-off or similar rights and remedies and burdening
only deposit accounts or other funds maintained with a depository institution
in the ordinary course of business; and

 

(18)                            any Lien
renewing or extending any Lien permitted by clauses (9) through (13) and
(15) above; provided, that, the
principal amount of the Indebtedness secured by any such Lien shall not exceed
the principal amount of the Indebtedness outstanding immediately prior to the
renewal or extension of the Lien, and no assets encumbered by the Lien other
than the assets encumbered immediately prior to the renewal or extension shall
be encumbered thereby.

 

“Permitted Refinancing Indebtedness” means Indebtedness
incurred by the Partnership or any Restricted Subsidiary to substantially and
concurrently (excluding any notice period on redemptions) repay, refund, renew,
replace, extend or refinance, in whole or in part, any Permitted Indebtedness
of the Partnership or any Restricted Subsidiary or any other Indebtedness
incurred by the Partnership or any Restricted Subsidiary pursuant to Section 4.09,
to the extent:

 

(1)                                  the principal
amount of the Permitted Refinancing Indebtedness does not exceed the principal
or accreted amount plus the amount of accrued and unpaid interest of the
Indebtedness so repaid, refunded, renewed, replaced, extended or refinanced
(plus the amount of all expenses and premiums incurred in connection
therewith);

 

(2)                                  with respect to
the repayment, refunding, renewal, replacement, extension or refinancing of the
Issuers’ Indebtedness, the Permitted Refinancing Indebtedness ranks no more
favorably in right of payment with respect to the Notes than the Indebtedness
so repaid, refunded, renewed, replaced, extended or refinanced; and

 

(3)                                  with respect to
the repayment, refunding, renewal, replacement, extension or refinancing of the
Issuers’ Indebtedness, the Permitted Refinancing Indebtedness has a Weighted
Average Life to Stated Maturity and stated maturity equal to, or greater than,
and has no fixed mandatory redemption or sinking fund requirement in an amount
greater than or at a time prior to the amounts set forth in, the Indebtedness
so repaid, refunded, renewed, replaced, extended or refinanced;

 

20

 

provided, however, that Permitted Refinancing
Indebtedness shall not include Indebtedness incurred by a Restricted Subsidiary
to repay, refund, renew, replace, extend or refinance Indebtedness of the
Partnership.

 

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

 

“Preferred Stock,” as applied to the Capital Stock of any
Person, means Capital Stock of any class or classes (however designated), which
is preferred as to the payment of distributions, dividends, or upon any
voluntary or involuntary liquidation or dissolution of such Person, over shares
or units of Capital Stock of any other class of such Person; provided, that any limited partnership
interest of the Partnership will not be considered Preferred Stock.

 

“Principal” means James E.
Ferrell.

 

“Private
Placement Legend” means the legend set forth in Section 2.06(g)(1) hereof
to be placed on all Notes issued under this Indenture except where otherwise
permitted by the provisions of this Indenture.

 

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

 

“Redeemable
Capital Stock” means any shares of any class or series of Capital
Stock, that, either by the terms thereof, by the terms of any security into
which it is convertible or exchangeable or by contract or otherwise, is or upon
the happening of an event or passage of time would be, required to be redeemed
prior to the stated maturity of the principal of the Notes or is redeemable at
the option of the holder thereof at any time prior to the stated maturity of
the principal of the Notes, or is convertible into or exchangeable for debt
securities at any time prior to the stated maturity of the principal of the
Notes.

 

“Registration
Rights Agreement” means the Registration Rights Agreement, dated as
of September 14, 2009, among the Ferrellgas, L.P., Finance Corp. and the
Initial Purchasers, as such agreement may be amended, modified or supplemented
from time to time.

 

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

 

“Regulation
S Global Note” means a Regulation S Temporary Global Note or
Regulation S Permanent Global Note, as appropriate.

 

“Regulation
S Permanent Global Note” means a permanent Global Note in the form of
Exhibit A1 hereto bearing the Global Note Legend and the Private Placement
Legend and deposited with or on behalf of and registered in the name of the
Depositary or its nominee, issued in a denomination equal to the outstanding
principal amount of the Regulation S Temporary Global Note upon expiration of
the Restricted Period.

 

“Regulation
S Temporary Global Note” means a temporary Global Note in the form of
Exhibit A2 hereto deposited with or on behalf of and registered in the
name of the Depositary or its nominee, issued in a denomination equal to the
outstanding principal amount of the Notes initially sold in reliance on Rule 903
of Regulation S.

 

21

 

“Related
Party” means any of the following:

 

(1)                                  any immediate
family member or lineal descendant of the Principal;

 

(2)                                  any trust,
corporation, partnership or other entity, the beneficiaries, stockholders,
partners, owners or Persons beneficially holding an 80% or more controlling
interest of which consist of any one or more Principals and/or such other
Persons referred to in the immediately preceding clause (1);

 

(3)                                  the Ferrell
Companies, Inc. Employee Stock Ownership Trust (“FCI ESOT”);

 

(4)                                  any participant
in the FCI ESOT whose account has been allocated shares of Ferrell Companies, Inc.;

 

(5)                                  Ferrell
Companies, Inc.; or

 

(6)                                  any Subsidiary
of Ferrell Companies, Inc.

 

“Responsible Officer,” when used with respect to the Trustee,
means any officer within the corporate trust department of the Trustee (or any
successor group of the Trustee) or any other officer of the Trustee customarily
performing functions similar to those performed by any of the above designated
officers and also means, with respect to a particular corporate trust matter,
any other officer to whom such matter is referred because of his knowledge of
and familiarity with the particular subject.

 

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

 

“Restricted
Subsidiary” means a Subsidiary of the Partnership, which, as of
the date of determination, is not an Unrestricted Subsidiary of the
Partnership.

 

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

 

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

 

“Rule 903” means Rule 903
promulgated under the Securities Act.

 

“Rule 904” means Rule 904
promulgated under the Securities Act.

 

“SEC” means the
Securities and Exchange Commission.

 

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

 

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

 

22

 

“Significant
Subsidiary” means any Subsidiary that would be a “significant
subsidiary” as defined in Article 1, Rule 1—02 of Regulation S—X,
promulgated pursuant to the Securities Act, as such Regulation is in effect on
the date of this Indenture.

 

“SPE” means any
special purpose Unrestricted Subsidiary established in connection with any
Accounts Receivable Securitization.

 

“Subsidiary” means, with
respect to any specified Person:

 

(1)                                  any
corporation, association or other business entity of which more than 50% of the
total voting power of shares of Capital Stock entitled (without regard to the
occurrence of any contingency) to vote in the election of directors, managers
or trustees of the corporation, association or other business entity is at the
time owned or controlled, directly or indirectly, by that Person or one or more
of the other Subsidiaries of that Person (or a combination thereof); and

 

(2)                                  any partnership
(a) the sole general partner or the managing general partner of which is
such Person or a Subsidiary of such Person or (b) the only general
partners of which are that Person or one or more Subsidiaries of that Person
(or any combination thereof).

 

“Termination
Capital Transactions” means any sale, transfer or other
disposition of property of the Partnership occurring upon or incident to the
liquidation and winding up of the Partnership.

 

“TIA” means the
Trust Indenture Act of 1939 (15 U.S.C. §§ 77aaa-77bbbb) as in effect on
the date on which this Indenture is qualified under the TIA, except as provided
in Section 9.03 hereof.

 

“Total
Assets” means, as of any date of determination, the consolidated total assets
of the Partnership and the Restricted Subsidiaries as would be shown on a
consolidated balance sheet of the Partnership and the Restricted Subsidiaries
prepared in accordance with GAAP as of that date.

 

“Trustee” means the party named as such in the preamble to
this Indenture until a successor replaces it in accordance with the applicable
provisions of this Indenture and thereafter means the successor serving
hereunder.

 

“Unrestricted
Global Note” means a permanent global Note substantially in the
form of Exhibit A attached hereto that bears the Global Note Legend and
that has the “Schedule of Exchanges of Interests in the Global Note” attached
thereto, and that is deposited with or on behalf of and registered in the name
of the Depositary.

 

“Unrestricted
Definitive Note” means one or more Definitive Notes.

 

“Unrestricted Subsidiary” means (a) Ferrellgas
Receivables, LLC, (b) Uni-Asia, Ltd., (c) Ferrellgas Real Estate, Inc.,
(d) Blue Rhino Canada, Inc., and (e) any other Person (other
than Finance Corp.) that is designated as such by the General Partner; provided, that no portion of the
Indebtedness of such Person:

 

23

 

(1)                                  is guaranteed
by the Partnership or any Restricted Subsidiary;

 

(2)                                  is recourse to
or obligates the Partnership or any Restricted Subsidiary in any way; or

 

(3)                                  subjects any
property or assets of the Partnership or any Restricted Subsidiary, directly or
indirectly, contingently or otherwise, to the satisfaction thereof.

 

Notwithstanding the foregoing, the
Partnership or a Restricted Subsidiary may guarantee or agree to provide funds
for the payment or maintenance of, or otherwise become liable with respect to
Indebtedness of an Unrestricted Subsidiary, but only to the extent that the
Partnership or a Restricted Subsidiary would be permitted to:

 

(1)                                  make an
Investment in the Unrestricted Subsidiary pursuant to the third clause of the
definition of Permitted Investments; and

 

(2)                                  incur the
Indebtedness represented by the guarantee or agreement pursuant to Section 4.09(a) hereto.
The Board of Directors may designate an Unrestricted Subsidiary to be a
Restricted Subsidiary; provided, that immediately after giving effect to the
designation there exists no Event of Default or event which after notice or
lapse or time or both would become an Event of Default, and if the Unrestricted
Subsidiary has, as of the date of the designation, outstanding Indebtedness
other than Permitted Indebtedness, the Partnership could incur at least $1.00
of Indebtedness other than Permitted Indebtedness.

 

Notwithstanding the foregoing, no Subsidiary
may be designated an Unrestricted Subsidiary if the Subsidiary, directly or
indirectly, holds Capital Stock of a Restricted Subsidiary.

 

“U.S.
Person” means a U.S. Person as defined in Rule 902(k) under the
Securities Act.

 

“Voting
Stock” of any Person as of any date means the Capital Stock of such Person
that is at the time entitled to vote in the election of the Board of Directors
of such Person.

 

“Weighted
Average Life to Stated Maturity” means, when applied to any
Indebtedness at any date, the number of years obtained by dividing:

 

the sum of the products obtained by
multiplying:

 

(a)  the amount of each
then remaining installment, sinking fund, serial maturity or other required
payments of principal, including payment at final maturity, in respect thereof,
by

 

(b)  the number of
years, calculated to the nearest one-twelfth, that will elapse between such
date and the making of such payment, by

 

(3)                                  the then
outstanding principal amount of such Indebtedness;

 

provided, however, that with respect to any
revolving Indebtedness, the foregoing calculation of Weighted Average Life to
Stated Maturity shall be determined based upon the total available 

 

24

 

commitments
and the required reductions of commitments in lieu of the outstanding principal
amount and the required payments of principal, respectively.

 

25

 

Section 1.02                                Other
Definitions.

 

	
   

  	
   

  	
  Defined
  in

  
	
  Term

  	
   

  	
  Section

  
	
  “Affiliate Transaction”

  	
   

  	
  4.11

  
	
  “Asset Sale Offer”

  	
   

  	
  3.09

  
	
  “Authentication Order”

  	
   

  	
  2.02

  
	
  “Change of Control Offer”

  	
   

  	
  4.14

  
	
  “Change of Control Payment”

  	
   

  	
  4.14

  
	
  “Change of Control Payment Date”

  	
   

  	
  4.14

  
	
  “Covenant
  Defeasance”

  	
   

  	
  8.03

  
	
  “DTC”

  	
   

  	
  2.03

  
	
  “Event of Default”

  	
   

  	
  6.01

  
	
  “Excess Proceeds”

  	
   

  	
  4.10

  
	
  “Existing Credit Agreement”

  	
   

  	
  1.01

  
	
  “incur”

  	
   

  	
  4.09

  
	
  “Issuers”

  	
   

  	
  Preamble

  
	
  “Legal Defeasance”

  	
   

  	
  8.02

  
	
  “Offer Amount”

  	
   

  	
  3.09

  
	
  “Offer Period”

  	
   

  	
  3.09

  
	
  “Paying Agent”

  	
   

  	
  2.03

  
	
  “Permitted Indebtedness”

  	
   

  	
  4.09

  
	
  “Purchase Date”

  	
   

  	
  3.09

  
	
  “Registrar”

  	
   

  	
  2.03

  
	
  “Restricted Payments”

  	
   

  	
  4.07

  

 

Section 1.03                                Incorporation
by Reference of Trust Indenture Act.

 

Whenever this Indenture
refers to a provision of the TIA, the provision is incorporated by reference in
and made a part of this Indenture.

 

The following TIA terms used
in this Indenture have the following meanings:

 

“indenture
securities” means the Notes;

 

“indenture
security Holder” means a Holder of a Note;

 

“indenture
to be qualified” means this Indenture;

 

“indenture
trustee” or “institutional
trustee” means the Trustee; and

 

“obligor” on the Notes
means the Issuers and any successor obligor upon the Notes.

 

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

 

26

 

Section 1.04                                Rules of
Construction.

 

Unless
the context otherwise requires:

 

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

 

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

 

(3)                                  “or” is not
exclusive;

 

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

 

(5)                                  “will” shall be
interpreted to express a command;

 

(6)                                  provisions
apply to successive events and transactions; and

 

(7)                                  references to
sections of or rules under the Securities Act will be deemed to include
substitute, replacement of successor sections or rules adopted by the SEC
from time to time.

 

ARTICLE 2.

THE NOTES

 

Section 2.01                                Form and
Dating.

 

(a)                                  General.  The Notes and the Trustee’s certificate of
authentication will be substantially in the form of Exhibit A hereto.  The Notes may have notations, legends or
endorsements required by law, stock exchange rule or usage.  Each Note will be dated the date of its
authentication.  The Notes shall be in
denominations of $2,000 and integral multiples of $1,000 in excess thereof.

 

The terms and provisions
contained in the Notes will constitute, and are hereby expressly made, a part
of this Indenture and the Issuers and the Trustee, by their execution and
delivery of this Indenture, expressly agree to such terms and provisions and to
be bound thereby.  However, to the extent
any provision of any Note conflicts with the express provisions of this
Indenture, the provisions of this Indenture shall govern and be controlling.

 

(b)                                 Global
Notes.  Notes issued in global form
will be substantially in the form of Exhibit A attached hereto (including
the Global Note Legend thereon and the “Schedule of Exchanges of Interests in
the Global Note” attached thereto). 
Notes issued in definitive form will be substantially in the form of Exhibit A
attached hereto (but without the Global Note Legend thereon and without the “Schedule
of Exchanges of Interests in the Global Note” attached thereto).  Each Global Note will represent such of the
outstanding Notes as will be specified therein and each shall provide that it
represents the aggregate principal amount of outstanding Notes from time to
time endorsed thereon and that the aggregate principal amount of outstanding
Notes represented thereby may from time to time be reduced or increased, as
appropriate, to reflect exchanges and redemptions.  Any endorsement of a Global Note to reflect 

 

27

 

the amount of any increase
or decrease in the aggregate principal amount of outstanding Notes represented
thereby will be made by the Trustee or the Custodian, at the direction of the
Trustee, in accordance with instructions given by the Holder thereof as
required by Section 2.06 hereof.

 

Section 2.02                                Execution and
Authentication.

 

An Officer must sign the
Notes for the Issuers by manual or facsimile signature.

 

If an Officer whose
signature is on a Note no longer holds that office at the time a Note is
authenticated, the Note will nevertheless be valid.

 

A Note will not be valid
until authenticated by the manual or facsimile signature of the Trustee.  The signature will be conclusive evidence
that the Note has been authenticated under this Indenture.

 

On the date of this
Indenture, the Trustee shall, upon a written order of the Issuers signed by an
Officer (an “Authentication Order”),
authenticate the Initial Notes for original issue up to $300,000,000 in
aggregate principal amount and, upon delivery of any Authentication Order at
any time and from time to time thereafter, the Trustee shall authenticate
Additional Notes for original issue in an aggregate principal amount specified
in such Authentication Order.

 

The Trustee may appoint an
authenticating agent acceptable to the Issuers to authenticate Notes.  An authenticating agent may authenticate
Notes whenever the Trustee may do so.  Each
reference in this Indenture to authentication by the Trustee includes
authentication by such agent.  An
authenticating agent has the same rights as an Agent to deal with Holders or an
Affiliate of the Issuers.

 

Section 2.03                                Registrar and
Paying Agent.

 

The Issuers will maintain an
office or agency where Notes may be presented for registration of transfer or
for exchange (“Registrar”) and an
office or agency where Notes may be presented for payment (“Paying Agent”).  The Registrar will keep a register of the
Notes and of their transfer and exchange. 
The Issuers may appoint one or more co-registrars and one or more
additional paying agents.  The term “Registrar”
includes any co-registrar and the term “Paying Agent” includes any additional
paying agent.  The Issuers may change any
Paying Agent or Registrar without notice to any Holder.  The Issuers will notify the Trustee in
writing of the name and address of any Agent not a party to this
Indenture.  If the Issuers fail to
appoint or maintain another entity as Registrar or Paying Agent, the Trustee
shall act as such.  The Partnership or
any of its Subsidiaries may act as Paying Agent or Registrar.

 

The Issuers initially
appoint The Depository Trust Company (“DTC”)
to act as Depositary with respect to the Global Notes.

 

The Issuers initially
appoint the Trustee to act as the Registrar and Paying Agent and to act as
Custodian with respect to the Global Notes.

 

28

 

Section 2.04                                Paying Agent to
Hold Money in Trust.

 

The Issuers will require
each Paying Agent other than the Trustee to agree in writing that the Paying
Agent will hold in trust for the benefit of Holders or the Trustee all money
held by the Paying Agent for the payment of principal, premium or interest on
the Notes, and will notify the Trustee of any default by the Issuers in making
any such payment.  While any such default
continues, the Trustee may require a Paying Agent to pay all money held by it
to the Trustee.  The Issuers at any time
may require a Paying Agent to pay all money held by it to the Trustee.  Upon payment over to the Trustee, the Paying
Agent (if other than the Issuers or a Subsidiary) will have no further
liability for the money.  If the
Partnership or a Subsidiary acts as Paying Agent, it will segregate and hold in
a separate trust fund for the benefit of the Holders all money held by it as
Paying Agent.  Upon any bankruptcy or
reorganization proceedings relating to the Issuers, the Trustee will serve as
Paying Agent for the Notes.

 

Section 2.05                                Holder Lists.

 

The Trustee will preserve in
as current a form as is reasonably practicable the most recent list available
to it of the names and addresses of all Holders and shall otherwise comply with
TIA § 312(a).  If the Trustee is not
the Registrar, the Issuers will furnish to the Trustee at least seven Business
Days before each interest payment date and at such other times as the Trustee
may request in writing, a list in such form and as of such date as the Trustee
may reasonably require of the names and addresses of the Holders of Notes and
the Issuers shall otherwise comply with TIA § 312(a).

 

Section 2.06                                Transfer and
Exchange.

 

(a)                                  Transfer
and Exchange of Global Notes.  A Global Note may not be transferred except
as a whole by the Depositary to a nominee of the Depositary, by a nominee of
the Depositary to the Depositary or to another nominee of the Depositary, or by
the Depositary or any such nominee to a successor Depositary or a nominee of
such successor Depositary.  All Global
Notes will be exchanged by the Issuers for Definitive Notes if:

 

(1)                                  the Issuers
deliver to the Trustee notice from the Depositary that it is unwilling or
unable to continue to act as Depositary or that it is no longer a clearing
agency registered under the Exchange Act and, in either case, a successor
Depositary is not appointed by the Issuers within 120 days after the date of
such notice from the Depositary;

 

(2)                                  the Issuers in
their sole discretion determine that the Global Notes (in whole but not in
part) should be exchanged for Definitive Notes and delivers a written notice to
such effect to the Trustee; provided
that in no event shall the Regulation S Temporary Global Note be exchanged by
the Issuers for Definitive Notes prior to (A) the expiration of the
Restricted Period and (B) the receipt by the Registrar of any certificates
required pursuant to Rule 903(b)(3)(ii)(B) under the Securities Act;
or

 

(3)                                  there has
occurred and is continuing a Default or Event of Default with respect to the
Notes.

 

29

 

Upon the occurrence of
either of the preceding events in (1) or (2) above, Definitive Notes
shall be issued in such names as the Depositary shall instruct the
Trustee.  Global Notes also may be
exchanged or replaced, in whole or in part, as provided in Sections 2.07 and
2.10 hereof.  Every Note authenticated
and delivered in exchange for, or in lieu of, a Global Note or any portion
thereof, pursuant to this Section 2.06 or Section 2.07 or 2.10
hereof, shall be authenticated and delivered in the form of, and shall be, a
Global Note.  A Global Note may not be
exchanged for another Note other than as provided in this Section 2.06(a),
however, beneficial interests in a Global Note may be transferred and exchanged
as provided in Section 2.06(b), (c) or (f) hereof.

 

(b)                                 Transfer
and Exchange of Beneficial Interests in the Global Notes.  The transfer and exchange of beneficial
interests in the Global Notes will be effected through the Depositary, in
accordance with the provisions of this Indenture and the Applicable
Procedures.  Beneficial interests in the
Restricted Global Notes will be subject to restrictions on transfer comparable
to those set forth herein to the extent required by the Securities Act.  Transfers of beneficial interests in the Global
Notes also will require compliance with either subparagraph (1) or (2) below,
as applicable, as well as one or more of the other following subparagraphs, as
applicable:

 

(1)                                  Transfer
of Beneficial Interests in the Same Global Note.  Beneficial interests in any Restricted Global
Note may be transferred to Persons who take delivery thereof in the form of a
beneficial interest in the same Restricted Global Note in accordance with the
transfer restrictions set forth in the Private Placement Legend; provided, however, that prior to the
expiration of the Restricted Period, transfers of beneficial interests in the
Regulation S Temporary  Global Note
may not be made to a U.S. Person or for the account or benefit of a U.S. Person
(other than an Initial Purchaser). 
Beneficial interests in any Unrestricted Global Note may be transferred
to Persons who take delivery thereof in the form of a beneficial interest in an
Unrestricted Global Note.  No written
orders or instructions shall be required to be delivered to the Registrar to
effect the transfers described in this Section 2.06(b)(1).

 

(2)                                  All
Other Transfers and Exchanges of Beneficial Interests in Global Notes.  In connection with all transfers and
exchanges of beneficial interests that are not subject to Section 2.06(b)(1) above,
the transferor of such beneficial interest must deliver to the Registrar
either:

 

(A) both:

 

(i)                                     a written order
from a Participant or an Indirect Participant given to the Depositary in
accordance with the Applicable Procedures directing the Depositary to credit or
cause to be credited a beneficial interest in another Global Note in an amount
equal to the beneficial interest to be transferred or exchanged; and

 

(ii)                                  instructions
given in accordance with the Applicable Procedures containing information
regarding the Participant account to be credited with such increase; or

 

(B) both:

 

30

 

(i)                                     a written order
from a Participant or an Indirect Participant given to the Depositary in
accordance with the Applicable Procedures directing the Depositary to cause to
be issued a Definitive Note in an amount equal to the beneficial interest to be
transferred or exchanged; and

 

(ii)                                  instructions
given by the Depositary to the Registrar containing information regarding the
Person in whose name such Definitive Note shall be registered to effect the
transfer or exchange referred to in (1) above;

 

provided that in no
event shall Definitive Notes be issued upon the transfer or exchange of
beneficial interests in the Regulation S Temporary Global Note prior to (A) the
expiration of the Restricted Period and (B) the receipt by the Registrar
of any certificates required pursuant to Rule 903 under the Securities
Act.

 

Upon consummation of an
Exchange Offer, if any, by the Issuers in accordance with Section 2.06(f) hereof,
the requirements of this Section 2.06(b)(2) shall be deemed to have
been satisfied upon receipt by the Registrar of the instructions contained in
the Letter of Transmittal delivered by the Holder of such beneficial interests
in the Restricted Global Notes.  Upon
satisfaction of all of the requirements for transfer or exchange of beneficial
interests in Global Notes contained in this Indenture and the Notes or otherwise
applicable under the Securities Act, the Trustee shall adjust the principal
amount of the relevant Global Note(s) pursuant to Section 2.06(h) hereof.

 

(3)                                  Transfer
of Beneficial Interests to Another Restricted Global Note.  A beneficial interest in any Restricted
Global Note may be transferred to a Person who takes delivery thereof in the
form of a beneficial interest in another Restricted Global Note if the transfer
complies with the requirements of Section 2.06(b)(2) above and the
Registrar receives the following:

 

(A) if the
transferee will take delivery in the form of a beneficial interest in the 144A
Global Note, then the transferor must deliver a certificate in the form of Exhibit B
hereto, including the certifications in item (1) thereof;

 

(B) if the
transferee will take delivery in the form of a beneficial interest in the
Regulation S Temporary Global Note or the Regulation S Permanent Global Note,
then the transferor must deliver a certificate in the form of Exhibit B
hereto, including the certifications in item (2) thereof; and

 

(C) if the
transferee will take delivery in the form of a beneficial interest in the IAI
Global Note, then the transferor must deliver a certificate in the form of Exhibit B
hereto, including the certifications, certificates and Opinion of Counsel
required by item (3) thereof, if applicable.

 

(4)                                  Transfer
and Exchange of Beneficial Interests in a Restricted Global Note for Beneficial
Interests in an Unrestricted Global Note.  A beneficial interest in any Restricted
Global Note may be exchanged by any holder thereof for a beneficial interest in
an Unrestricted Global Note or transferred to a Person who takes delivery
thereof in 

 

31

 

the form of a beneficial
interest in an Unrestricted Global Note if the exchange or transfer complies
with the requirements of Section 2.06(b)(2) above and:

 

(A) such exchange
or transfer is effected pursuant to any Exchange Offer in accordance with the
Registration Rights Agreement and the holder of the beneficial interest to be
transferred, in the case of an exchange, or the transferee, in the case of a
transfer, certifies in the applicable Letter of Transmittal that it is not (i) a
Broker-Dealer, (ii) a Person participating in the distribution of the
Exchange Notes or (iii) a Person who is an affiliate (as defined in Rule 144)
of the Issuers;

 

(B) such transfer
is effected pursuant to the Shelf Registration Statement in accordance with the
Registration Rights Agreement;

 

(C) such transfer
is effected by a Broker-Dealer pursuant to any Exchange Offer Registration
Statement in accordance with the Registration Rights Agreement; or

 

(D) the Registrar
receives the following:

 

(i)                                     if the holder
of such beneficial interest in a Restricted Global Note proposes to exchange
such beneficial interest for a beneficial interest in an Unrestricted Global
Note, a certificate from such holder in the form of Exhibit C hereto,
including the certifications in item (1)(a) thereof; or

 

(ii)                                  if the holder
of such beneficial interest in a Restricted Global Note proposes to transfer
such beneficial interest to a Person who shall take delivery thereof in the
form of a beneficial interest in an Unrestricted Global Note, a certificate
from such holder in the form of Exhibit B hereto, including the
certifications in item (4) thereof;

 

and, in each such case set forth in this
subparagraph (D), if the Registrar so requests or if the Applicable Procedures
so require, an Opinion of Counsel in form reasonably acceptable to the
Registrar to the effect that such exchange or transfer is in compliance with
the Securities Act and that the restrictions on transfer contained herein and
in the Private Placement Legend are no longer required in order to maintain
compliance with the Securities Act.

 

If any such transfer is
effected pursuant to subparagraph (B) or (D) above at a time when an
Unrestricted Global Note has not yet been issued, the Issuers shall issue and,
upon receipt of an Authentication Order in accordance with Section 2.02
hereof, the Trustee shall authenticate one or more Unrestricted Global Notes in
an aggregate principal amount equal to the aggregate principal amount of
beneficial interests transferred pursuant to subparagraph (B) or (D) above.

 

Beneficial interests in an
Unrestricted Global Note cannot be exchanged for, or transferred to Persons who
take delivery thereof in the form of, a beneficial interest in a Restricted
Global Note.

 

32

 

(c)                                  Transfer
or Exchange of Beneficial Interests for Definitive Notes.

 

(1)                                  Beneficial
Interests in Restricted Global Notes to Restricted Definitive Notes.  If any holder of a beneficial interest in a
Restricted Global Note proposes to exchange such beneficial interest for a
Restricted Definitive Note or to transfer such beneficial interest to a Person
who takes delivery thereof in the form of a Restricted Definitive Note, then,
upon receipt by the Registrar of the following documentation:

 

(A) if the holder
of such beneficial interest in a Restricted Global Note proposes to exchange
such beneficial interest for a Restricted Definitive Note, a certificate from
such holder in the form of Exhibit C hereto, including the certifications
in item (2)(a) thereof;

 

(B) if such
beneficial interest is being transferred to a QIB in accordance with Rule 144A,
a certificate to the effect set forth in Exhibit B hereto, including the
certifications in item (1) thereof;

 

(C) if such
beneficial interest is being transferred to a Non-U.S. Person in an offshore
transaction in accordance with Rule 903 or Rule 904, a certificate to
the effect set forth in Exhibit B hereto, including the certifications in
item (2) thereof;

 

(D) if such
beneficial interest is being transferred pursuant to an exemption from the
registration requirements of the Securities Act in accordance with Rule 144,
a certificate to the effect set forth in Exhibit B hereto, including the
certifications in item (3)(a) thereof;

 

(E) if such
beneficial interest is being transferred to an Institutional Accredited
Investor in reliance on an exemption from the registration requirements of the
Securities Act other than those listed in subparagraphs (B) through (D) above,
a certificate to the effect set forth in Exhibit B hereto, including the
certifications, certificates and Opinion of Counsel required by item (3) thereof,
if applicable;

 

(F) if such
beneficial interest is being transferred to the Issuers or any of their
Subsidiaries, a certificate to the effect set forth in Exhibit B hereto,
including the certifications in item (3)(b) thereof; or

 

(G) if such
beneficial interest is being transferred pursuant to an effective registration
statement under the Securities Act, a certificate to the effect set forth in Exhibit B
hereto, including the certifications in item (3)(c) thereof,

 

the Trustee shall cause the
aggregate principal amount of the applicable Global Note to be reduced
accordingly pursuant to Section 2.06(h) hereof, and the Issuers shall
execute and the Trustee shall authenticate and deliver to the Person designated
in the instructions a Definitive Note in the appropriate principal amount.  Any Definitive Note issued in exchange for a
beneficial interest in a Restricted Global Note pursuant to this Section 2.06(c) shall
be registered in such name or names and in such authorized denomination or
denominations as the holder of 

 

33

 

such beneficial interest
shall instruct the Registrar through instructions from the Depositary and the
Participant or Indirect Participant.  The
Trustee shall deliver such Definitive Notes to the Persons in whose names such
Notes are so registered.  Any Definitive
Note issued in exchange for a beneficial interest in a Restricted Global Note
pursuant to this Section 2.06(c)(1) shall bear the Private Placement
Legend and shall be subject to all restrictions on transfer contained therein.

 

(2)                                  Beneficial
Interests in Regulation S Temporary Global Note to Definitive Notes.  Notwithstanding Sections 2.06(c)(1)(A) and
(C) hereof, a beneficial interest in the Regulation S Temporary Global
Note may not be exchanged for a Definitive Note or transferred to a Person who
takes delivery thereof in the form of a Definitive Note prior to (A) the
expiration of the Restricted Period and (B) the receipt by the Registrar
of any certificates required pursuant to Rule 903(b)(3)(ii)(B) under
the Securities Act, except in the case of a transfer pursuant to an exemption
from the registration requirements of the Securities Act other than Rule 903
or Rule 904.

 

(3)                                  Beneficial
Interests in Restricted Global Notes to Unrestricted Definitive Notes.  A holder of a beneficial interest in a
Restricted Global Note may exchange such beneficial interest for an
Unrestricted Definitive Note or may transfer such beneficial interest to a
Person who takes delivery thereof in the form of an Unrestricted Definitive
Note only if:

 

(A) such exchange
or transfer is effected pursuant to the Exchange Offer, if any, in accordance
with the Registration Rights Agreement and the holder of such beneficial
interest, in the case of an exchange, or the transferee, in the case of a
transfer, certifies in the applicable Letter of Transmittal that it is not (i) a
Broker-Dealer, (ii) a Person participating in the distribution of the
Exchange Notes or (iii) a Person who is an affiliate (as defined in Rule 144)
of the Issuers;

 

(B) such transfer
is effected pursuant to the Shelf Registration Statement in accordance with the
Registration Rights Agreement;

 

(C) such transfer
is effected by a Broker-Dealer pursuant to any Exchange Offer Registration
Statement in accordance with the Registration Rights Agreement; or

 

(D) the Registrar
receives the following:

 

(i)                                     if the holder
of such beneficial interest in a Restricted Global Note proposes to exchange
such beneficial interest for an Unrestricted Definitive Note, a certificate
from such holder in the form of Exhibit C hereto, including the
certifications in item (1)(b) thereof; or

 

(ii)                                  if the holder
of such beneficial interest in a Restricted Global Note proposes to transfer
such beneficial interest to a Person who shall take delivery thereof in the
form of an Unrestricted Definitive Note, a certificate from such holder in the
form of Exhibit B hereto, including the certifications in item (4) thereof;

 

34

 

and, in each such case set forth in this
subparagraph (D), if the Registrar so requests or if the Applicable Procedures
so require, an Opinion of Counsel in form reasonably acceptable to the
Registrar to the effect that such exchange or transfer is in compliance with
the Securities Act and that the restrictions on transfer contained herein and
in the Private Placement Legend are no longer required in order to maintain
compliance with the Securities Act.

 

(4)                                  Beneficial
Interests in Unrestricted Global Notes to Unrestricted Definitive Notes.  If any holder of a beneficial interest in an
Unrestricted Global Note proposes to exchange such beneficial interest for a
Definitive Note or to transfer such beneficial interest to a Person who takes
delivery thereof in the form of a Definitive Note, then, upon satisfaction of
the conditions set forth in Section 2.06(b)(2) hereof, the Trustee
will cause the aggregate principal amount of the applicable Global Note to be
reduced accordingly pursuant to Section 2.06(h) hereof, and the
Issuers will execute and the Trustee will authenticate and deliver to the
Person designated in the instructions a Definitive Note in the appropriate
principal amount.  Any Definitive Note
issued in exchange for a beneficial interest pursuant to this Section 2.06(c)(4) will
be registered in such name or names and in such authorized denomination or
denominations as the holder of such beneficial interest requests through
instructions to the Registrar from or through the Depositary and the
Participant or Indirect Participant.  The
Trustee will deliver such Definitive Notes to the Persons in whose names such
Notes are so registered.  Any Definitive
Note issued in exchange for a beneficial interest pursuant to this Section 2.06(c)(4) will
not bear the Private Placement Legend.

 

(d)                                 Transfer
and Exchange of Definitive Notes for Beneficial Interests.

 

(1)                                  Restricted
Definitive Notes to Beneficial Interests in Restricted Global Notes.  If any Holder of a Restricted Definitive Note
proposes to exchange such Note for a beneficial interest in a Restricted Global
Note or to transfer such Restricted Definitive Notes to a Person who takes
delivery thereof in the form of a beneficial interest in a Restricted Global
Note, then, upon receipt by the Registrar of the following documentation:

 

(A) if the Holder
of such Restricted Definitive Note proposes to exchange such Note for a
beneficial interest in a Restricted Global Note, a certificate from such Holder
in the form of Exhibit C hereto, including the certifications in item (2)(b) thereof;

 

(B) if such
Restricted Definitive Note is being transferred to a QIB in accordance with Rule 144A,
a certificate to the effect set forth in Exhibit B hereto, including the
certifications in item (1) thereof;

 

(C) if such
Restricted Definitive Note is being transferred to a Non-U.S. Person in an
offshore transaction in accordance with Rule 903 or Rule 904, a
certificate to the effect set forth in Exhibit B hereto, including the
certifications in item (2) thereof;

 

35

 

(D) if such
Restricted Definitive Note is being transferred pursuant to an exemption from
the registration requirements of the Securities Act in accordance with Rule 144,
a certificate to the effect set forth in Exhibit B hereto, including the
certifications in item (3)(a) thereof;

 

(E) if such
Restricted Definitive Note is being transferred to an Institutional Accredited
Investor in reliance on an exemption from the registration requirements of the
Securities Act other than those listed in subparagraphs (B) through (D) above,
a certificate to the effect set forth in Exhibit B hereto, including the
certifications, certificates and Opinion of Counsel required by item (3) thereof,
if applicable;

 

(F) if such
Restricted Definitive Note is being transferred to the Issuers or any of their
Subsidiaries, a certificate to the effect set forth in Exhibit B hereto,
including the certifications in item (3)(b) thereof; or

 

(G) if such
Restricted Definitive Note is being transferred pursuant to an effective
registration statement under the Securities Act, a certificate to the effect
set forth in Exhibit B hereto, including the certifications in item (3)(c) thereof,

 

the Trustee will cancel the Restricted Definitive
Note, increase or cause to be increased the aggregate principal amount of, in
the case of clause (A) above, the appropriate Restricted Global Note, in
the case of clause (B) above, the 144A Global Note, in the case of clause (C) above,
the Regulation S Global Note, and in all other cases, the IAI Global Note.

 

(2)                                  Restricted
Definitive Notes to Beneficial Interests in Unrestricted Global Notes.  A Holder of a Restricted Definitive Note may
exchange such Note for a beneficial interest in an Unrestricted Global Note or
transfer such Restricted Definitive Note to a Person who takes delivery thereof
in the form of a beneficial interest in an Unrestricted Global Note only if:

 

(A) such exchange
or transfer is effected pursuant to the Exchange Offer, if any, in accordance
with the Registration Rights Agreement and the Holder, in the case of an
exchange, or the transferee, in the case of a transfer, certifies in the
applicable Letter of Transmittal that it is not (i) a Broker-Dealer, (ii) a
Person participating in the distribution of the Exchange Notes or (iii) a
Person who is an affiliate (as defined in Rule 144) of the Issuers;

 

(B) such transfer
is effected pursuant to the Shelf Registration Statement in accordance with the
Registration Rights Agreement;

 

(C) such transfer
is effected by a Broker-Dealer pursuant to any Exchange Offer Registration
Statement in accordance with the Registration Rights Agreement; or

 

(D) the Registrar
receives the following:

 

36

 

(i)                                     if the Holder
of such Definitive Notes proposes to exchange such Notes for a beneficial
interest in the Unrestricted Global Note, a certificate from such Holder in the
form of Exhibit C hereto, including the certifications in item (1)(c) thereof;
or

 

(ii)                                  if the Holder
of such Definitive Notes proposes to transfer such Notes to a Person who shall
take delivery thereof in the form of a beneficial interest in the Unrestricted
Global Note, a certificate from such Holder in the form of Exhibit B
hereto, including the certifications in item (4) thereof;

 

and, in each such case set forth in this
subparagraph (D), if the Registrar so requests or if the Applicable Procedures
so require, an Opinion of Counsel in form reasonably acceptable to the
Registrar to the effect that such exchange or transfer is in compliance with the
Securities Act and that the restrictions on transfer contained herein and in
the Private Placement Legend are no longer required in order to maintain
compliance with the Securities Act.

 

Upon
satisfaction of the conditions of any of the subparagraphs in this Section 2.06(d)(2),
the Trustee will cancel the Definitive Notes and increase or cause to be
increased the aggregate principal amount of the Unrestricted Global Note.

 

(3)                                  Unrestricted
Definitive Notes to Beneficial Interests in Unrestricted Global Notes.  A Holder of an Unrestricted Definitive Note
may exchange such Note for a beneficial interest in an Unrestricted Global Note
or transfer such Definitive Notes to a Person who takes delivery thereof in the
form of a beneficial interest in an Unrestricted Global Note at any time.  Upon receipt of a request for such an
exchange or transfer, the Trustee will cancel the applicable Unrestricted
Definitive Note and increase or cause to be increased the aggregate principal
amount of one of the Unrestricted Global Notes.

 

If
any such exchange or transfer from a Definitive Note to a beneficial interest
is effected pursuant to subparagraphs (2)(B), (2)(D) or (3) above at
a time when an Unrestricted Global Note has not yet been issued, the Issuers
will issue and, upon receipt of an Authentication Order in accordance with Section 2.02
hereof, the Trustee will authenticate one or more Unrestricted Global Notes in
an aggregate principal amount equal to the principal amount of Definitive Notes
so transferred.

 

(e)                                  Transfer
and Exchange of Definitive Notes for Definitive Notes.  Upon request by a Holder of Definitive Notes
and such Holder’s compliance with the provisions of this Section 2.06(e),
the Registrar will register the transfer or exchange of Definitive Notes.  Prior to such registration of transfer or
exchange, the requesting Holder must present or surrender to the Registrar the
Definitive Notes duly endorsed or accompanied by a written instruction of
transfer in form satisfactory to the Registrar duly executed by such Holder or
by its attorney, duly authorized in writing. 
In addition, the requesting Holder must provide any additional
certifications, documents and information, as applicable, required pursuant to
the following provisions of this Section 2.06(e).

 

37

 

(1)                                  Restricted
Definitive Notes to Restricted Definitive Notes.  Any Restricted Definitive Note may be
transferred to and registered in the name of Persons who take delivery thereof
in the form of a Restricted Definitive Note if the Registrar receives the
following:

 

(A) if the transfer
will be made pursuant to Rule 144A, then the transferor must deliver a
certificate in the form of Exhibit B hereto, including the certifications
in item (1) thereof;

 

(B) if the transfer
will be made pursuant to Rule 903 or Rule 904, then the transferor
must deliver a certificate in the form of Exhibit B hereto, including the
certifications in item (2) thereof; and

 

(C) if the transfer
will be made pursuant to any other exemption from the registration requirements
of the Securities Act, then the transferor must deliver a certificate in the
form of Exhibit B hereto, including the certifications, certificates and
Opinion of Counsel required by item (3) thereof, if applicable.

 

(2)                                  Restricted
Definitive Notes to Unrestricted Definitive Notes.  Any Restricted Definitive Note may be
exchanged by the Holder thereof for an Unrestricted Definitive Note or
transferred to a Person or Persons who take delivery thereof in the form of an
Unrestricted Definitive Note if:

 

(A) such exchange
or transfer is effected pursuant to the Exchange Offer, if any, in accordance
with the Registration Rights Agreement and the Holder, in the case of an
exchange, or the transferee, in the case of a transfer, certifies in the
applicable Letter of Transmittal that it is not (i) a Broker-Dealer, (ii) a
Person participating in the distribution of the Exchange Notes or (iii) a
Person who is an affiliate (as defined in Rule 144) of the Issuers;

 

(B) any such transfer
is effected pursuant to the Shelf Registration Statement in accordance with the
Registration Rights Agreement;

 

(C) any such
transfer is effected by a Broker-Dealer pursuant to any Exchange Offer
Registration Statement in accordance with the Registration Rights Agreement; or

 

(D) the Registrar
receives the following:

 

(i)                                     if the Holder
of such Restricted Definitive Notes proposes to exchange such Notes for an
Unrestricted Definitive Note, a certificate from such Holder in the form of Exhibit C
hereto, including the certifications in item (1)(d) thereof; or

 

(ii)                                  if the Holder
of such Restricted Definitive Notes proposes to transfer such Notes to a Person
who shall take delivery thereof in the form of an Unrestricted Definitive Note,
a certificate from such Holder in

 

38

 

the
form of Exhibit B hereto, including the certifications in item (4) thereof;

 

and, in each such case set forth in this
subparagraph (D), if the Registrar so requests, an Opinion of Counsel in form
reasonably acceptable to the Registrar to the effect that such exchange or
transfer is in compliance with the Securities Act and that the restrictions on
transfer contained herein and in the Private Placement Legend are no longer
required in order to maintain compliance with the Securities Act.

 

(3)                                  Unrestricted
Definitive Notes to Unrestricted Definitive Notes.  A Holder of Unrestricted Definitive Notes may
transfer such Notes to a Person who takes delivery thereof in the form of an
Unrestricted Definitive Note.  Upon
receipt of a request to register such a transfer, the Registrar shall register
the Unrestricted Definitive Notes pursuant to the instructions from the Holder
thereof.

 

(f)                                    Exchange
Offer.  Upon the occurrence of the
Exchange Offer, if any, in accordance with the Registration Rights Agreement,
the Issuers will issue and, upon receipt of an Authentication Order in
accordance with Section 2.02 hereof, the Trustee will authenticate:

 

(1)                                  one or more
Unrestricted Global Notes in an aggregate principal amount equal to the
principal amount of the beneficial interests in the Restricted Global Notes
accepted for exchange in the Exchange Offer by Persons that certify in the
applicable Letters of Transmittal that (A) they are not Broker-Dealers, (B) they
are not participating in a distribution of the Exchange Notes and (C) they
are not affiliates (as defined in Rule 144) of the Issuers; and

 

(2)                                  Unrestricted
Definitive Notes in an aggregate principal amount equal to the principal amount
of the Restricted Definitive Notes accepted for exchange in the Exchange Offer
by Persons that certify in the applicable Letters of Transmittal that (A) they
are not Broker-Dealers, (B) they are not participating in a distribution
of the Exchange Notes and (C) they are not affiliates (as defined in Rule 144)
of the Issuers.

 

Concurrently with the issuance of such Notes, the
Trustee will cause the aggregate principal amount of the applicable Restricted
Global Notes to be reduced accordingly, and the Issuers will execute and the
Trustee will authenticate and deliver to the Persons designated by the Holders
of Definitive Notes so accepted Unrestricted Definitive Notes in the
appropriate principal amount.

 

(g)                                 Legends.  The following legends will appear on the face
of all Global Notes and Definitive Notes issued under this Indenture unless
specifically stated otherwise in the applicable provisions of this Indenture.

 

(1)                                  Private
Placement Legend.

 

(A) Except as
permitted by subparagraph (B) below, each Global Note and each Definitive
Note (and all Notes issued in exchange therefor or substitution thereof) shall
bear the legend in substantially the following form:

 

39

 

“THIS NOTE HAS NOT BEEN
REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED (THE “SECURITIES ACT”),
OR ANY STATE SECURITIES LAWS. NEITHER THIS NOTE, NOR ANY INTEREST OR
PARTICIPATION HEREIN MAY BE OFFERED, 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 THE REGISTRATION
REQUIREMENTS OF THE SECURITIES ACT. THE HOLDER OF THIS NOTE, BY ITS ACCEPTANCE
HEREOF, AGREES NOT TO OFFER, SELL OR OTHERWISE TRANSFER SUCH SECURITY, PRIOR TO
THE DATE WHICH IS ONE YEAR 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 NOTE (OR ANY PREDECESSOR OF THIS NOTE) (THE “RESALE RESTRICTION
TERMINATION DATE”), EXCEPT THAT THE NOTES MAY BE TRANSFERRED (A) TO
THE COMPANY OR ANY SUBSIDIARY THEREOF, (B) PURSUANT TO AN EFFECTIVE
REGISTRATION STATEMENT UNDER THE SECURITIES ACT, (C) FOR SO LONG AS THE
NOTES ENDORSED THEREON ARE ELIGIBLE FOR RESALE PURSUANT TO RULE 144A UNDER THE
SECURITIES ACT (“RULE 144A”), TO A PERSON IT REASONABLY BELIEVES IS A “QUALIFIED
INSTITUTIONAL BUYER” AS DEFINED IN RULE 144A 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, (D) PURSUANT TO
OFFERS AND SALES TO NON-U.S. PERSONS THAT OCCUR OUTSIDE THE UNITED STATES
WITHIN THE MEANING OF AND IN COMPLIANCE WITH REGULATION S UNDER THE SECURITIES
ACT, (E) TO AN INSTITUTIONAL “ACCREDITED INVESTOR” (AS DEFINED IN RULE
501(A)(1), (2), (3) OR (7) OF REGULATION D UNDER THE SECURITIES ACT)
THAT, PRIOR TO SUCH TRANSFER, FURNISHES THE TRUSTEE A SIGNED LETTER CONTAINING
CERTAIN REPRESENTATIONS AND AGREEMENTS RELATING TO THE TRANSFER OF THE NOTES
AND, IF SUCH TRANSFER IS IN RESPECT OF AN AGGREGATE PRINCIPAL AMOUNT OF NOTES
LESS THAN $250,000, AN OPINION OF COUNSEL ACCEPTABLE TO THE ISSUERS THAT SUCH
TRANSFER IS IN COMPLIANCE WITH THE SECURITIES ACT, OR (F) PURSUANT TO
ANOTHER AVAILABLE EXEMPTION FROM THE REGISTRATION REQUIREMENTS OF THE
SECURITIES ACT, SUBJECT TO THE COMPANY’S AND THE TRUSTEE’S RIGHT PRIOR TO ANY
SUCH OFFER, SALE OR TRANSFER (1) PURSUANT TO CLAUSE (D) PRIOR TO THE
END OF THE 40-DAY DISTRIBUTION COMPLIANCE PERIOD WITHIN THE MEANING OF REGULATION
S UNDER THE SECURITIES ACT OR PURSUANT TO CLAUSE (F) PRIOR TO THE RESALE
RESTRICTION TERMINATION DATE TO REQUIRE THE DELIVERY OF AN OPINION OF COUNSEL,
CERTIFICATION AND/OR OTHER INFORMATION SATISFACTORY TO EACH OF THEM, AND (2) IN
EACH OF THE FOREGOING CASES, TO REQUIRE THAT A CERTIFICATE OF TRANSFER IN THE FORM APPEARING
ON THIS NOTE IS COMPLETED AND DELIVERED BY THE TRANSFEROR TO THE TRUSTEE. THIS
LEGEND WILL BE REMOVED UPON THE REQUEST OF A HOLDER AFTER THE RESALE
RESTRICTION TERMINATION DATE.”

 

(B) Notwithstanding
the foregoing, any Global Note or Definitive Note issued pursuant to
subparagraphs (b)(4), (c)(3), (c)(4), (d)(2), (d)(3), (e)(2), (e)(3)

 

40

 

or (f) of this Section 2.06
(and all Notes issued in exchange therefor or substitution thereof) will not
bear the Private Placement Legend.

 

(2)                                  Global
Note Legend.  Each Global
Note will bear a legend in substantially the following form:

 

“THIS GLOBAL NOTE IS HELD BY
THE DEPOSITARY (AS DEFINED IN THE INDENTURE GOVERNING THIS NOTE) OR ITS NOMINEE
IN CUSTODY FOR THE BENEFIT OF THE BENEFICIAL OWNERS HEREOF, AND IS NOT
TRANSFERABLE TO ANY PERSON UNDER ANY CIRCUMSTANCES EXCEPT THAT (I) THE
TRUSTEE MAY MAKE SUCH NOTATIONS HEREON AS MAY BE REQUIRED PURSUANT TO
SECTION 2.06 OF THE INDENTURE, (II) THIS GLOBAL NOTE MAY BE
EXCHANGED IN WHOLE BUT NOT IN PART PURSUANT TO SECTION 2.06(a) OF
THE INDENTURE, (III) THIS GLOBAL NOTE MAY BE DELIVERED TO THE TRUSTEE
FOR CANCELLATION PURSUANT TO SECTION 2.11 OF THE INDENTURE AND (IV) THIS
GLOBAL NOTE MAY BE TRANSFERRED TO A SUCCESSOR DEPOSITARY WITH THE PRIOR
WRITTEN CONSENT OF THE ISSUERS.

 

UNLESS AND UNTIL IT IS
EXCHANGED IN WHOLE OR IN PART FOR NOTES IN DEFINITIVE FORM, THIS NOTE MAY NOT
BE TRANSFERRED EXCEPT AS A WHOLE BY THE DEPOSITARY TO A NOMINEE OF THE
DEPOSITARY OR BY A NOMINEE OF THE DEPOSITARY TO THE DEPOSITARY OR ANOTHER
NOMINEE OF THE DEPOSITARY OR BY THE DEPOSITARY OR ANY SUCH NOMINEE TO A
SUCCESSOR DEPOSITARY OR A NOMINEE OF SUCH SUCCESSOR DEPOSITARY.  UNLESS THIS CERTIFICATE IS PRESENTED BY AN
AUTHORIZED REPRESENTATIVE OF THE DEPOSITORY TRUST COMPANY (55 WATER STREET, NEW
YORK, NEW YORK) (“DTC”), TO THE ISSUERS OR THEIR AGENT FOR REGISTRATION OF
TRANSFER, EXCHANGE OR PAYMENT, AND ANY CERTIFICATE ISSUED IS REGISTERED IN THE
NAME OF CEDE & CO. OR SUCH OTHER NAME AS MAY BE REQUESTED BY AN
AUTHORIZED REPRESENTATIVE OF DTC (AND ANY PAYMENT IS MADE TO CEDE &
CO. OR SUCH OTHER ENTITY AS MAY BE REQUESTED BY AN AUTHORIZED
REPRESENTATIVE OF DTC), ANY TRANSFER, PLEDGE OR OTHER USE HEREOF FOR VALUE OR
OTHERWISE BY OR TO ANY PERSON IS WRONGFUL INASMUCH AS THE REGISTERED OWNER
HEREOF, CEDE & CO., HAS AN INTEREST HEREIN.”

 

(3)                                  Regulation
S Temporary Global Note Legend.  The Regulation S Temporary Global Note will
bear a Legend in substantially the following form:

 

“THE RIGHTS ATTACHING TO
THIS REGULATION S TEMPORARY GLOBAL NOTE, AND THE CONDITIONS AND PROCEDURES
GOVERNING ITS EXCHANGE FOR CERTIFICATED NOTES, ARE AS SPECIFIED IN THE
INDENTURE (AS DEFINED HEREIN).  NEITHER
THE HOLDER NOR THE BENEFICIAL OWNERS OF THIS REGULATION S TEMPORARY GLOBAL NOTE
SHALL BE ENTITLED TO RECEIVE PAYMENT OF INTEREST HEREON.”

 

(4)                                  Tax
Legend.  With respect to any Additional
Notes issued with original issue discount for U.S. federal income tax purposes,
each Global Note and each Definitive Note shall bear a legend in substantially
the following form:

 

41

 

“THIS NOTE WAS ISSUED WITH
ORIGINAL ISSUE DISCOUNT UNDER SECTION 1272, 1273 AND 1275 OF THE INTERNAL
REVENUE CODE OF 1986, AS AMENDED.  YOU MAY CONTACT
THE CHIEF FINANCIAL OFFICER OF FERRELLGAS, L.P., 7500 COLLEGE BOULEVARD, SUITE
1000, OVERLAND PARK, KS 66210, WHO WILL PROVIDE YOU WITH THE ISSUE PRICE, THE
AMOUNT OF ORIGINAL ISSUE DISCOUNT, THE ISSUE DATE, AND THE YIELD TO MATURITY OF
THE NOTE.”

 

(h)                                 Cancellation
and/or Adjustment of Global Notes.  At such time as all beneficial interests in a
particular Global Note have been exchanged for Definitive Notes or a particular
Global Note has been redeemed, repurchased or canceled in whole and not in
part, each such Global Note will be returned to or retained and canceled by the
Trustee in accordance with Section 2.11 hereof.  At any time prior to such cancellation, if
any beneficial interest in a Global Note is exchanged for or transferred to a
Person who will take delivery thereof in the form of a beneficial interest in
another Global Note or for Definitive Notes, the principal amount of Notes
represented by such Global Note will be reduced accordingly and an endorsement
will be made on such Global Note by the Trustee or by the Depositary at the
direction of the Trustee to reflect such reduction; and if the beneficial
interest is being exchanged for or transferred to a Person who will take
delivery thereof in the form of a beneficial interest in another Global Note,
such other Global Note will be increased accordingly and an endorsement will be
made on such Global Note by the Trustee or by the Depositary at the direction
of the Trustee to reflect such increase.

 

(i)                                     General
Provisions Relating to Transfers and Exchanges.

 

(1)                                  To permit
registrations of transfers and exchanges, the Issuers will execute and the
Trustee will authenticate Global Notes and Definitive Notes upon receipt of an
Authentication Order in accordance with Section 2.02 hereof or at the
Registrar’s request.

 

(2)                                  No service
charge will be made to a Holder of a beneficial interest in a Global Note or to
a Holder of a Definitive Note for any registration of transfer or exchange, but
the Issuers may require payment of a sum sufficient to cover any transfer tax
or similar governmental charge payable in connection therewith (other than any
such transfer taxes or similar governmental charge payable upon exchange or
transfer pursuant to Sections 2.10, 3.06, 3.09, 4.10, 4.14 and 9.05 hereof).

 

(3)                                  The Registrar
will not be required to register the transfer of or exchange of any Note
selected for redemption in whole or in part, except the unredeemed portion of
any Note being redeemed in part.

 

(4)                                  All Global
Notes and Definitive Notes issued upon any registration of transfer or exchange
of Global Notes or Definitive Notes will be the valid obligations of the
Issuers, evidencing the same debt, and entitled to the same benefits under this
Indenture, as the Global Notes or Definitive Notes surrendered upon such
registration of transfer or exchange.

 

(5)                                  Neither the
Registrar nor the Issuers will be required:

 

42

 

(A) to issue, to
register the transfer of or to exchange any Notes during a period beginning at
the opening of business 15 days before the day of any selection of Notes for
redemption under Section 3.02 hereof and ending at the close of business
on the day of selection;

 

(B) to register the
transfer of or to exchange any Note selected for redemption in whole or in
part, except the unredeemed portion of any Note being redeemed in part; or

 

(C) to register the
transfer of or to exchange a Note between a record date and the next succeeding
interest payment date.

 

(6)                                  Prior to due
presentment for the registration of a transfer of any Note, the Trustee, any
Agent and the Issuers may deem and treat the Person in whose name any Note is
registered as the absolute owner of such Note for the purpose of receiving
payment of principal of and interest on such Notes and for all other purposes,
and none of the Trustee, any Agent or the Issuers shall be affected by notice
to the contrary.

 

(7)                                  The Trustee
will authenticate Global Notes and Definitive Notes in accordance with the
provisions of Section 2.02 hereof.

 

All
certifications, certificates and Opinions of Counsel required to be submitted
to the Registrar pursuant to this Section 2.06 to effect a registration of
transfer or exchange may be submitted by facsimile.

 

Section 2.07                                Replacement
Notes.

 

If any mutilated Note is surrendered to the Trustee
or the Issuers and the Trustee receives evidence to its satisfaction of the
destruction, loss or theft of any Note, the Issuers will issue and the Trustee,
upon receipt of an Authentication Order, will authenticate a replacement Note
if the Trustee’s requirements are met. 
An indemnity bond must be supplied by the Holder that is sufficient in
the judgment of the Trustee and the Issuers to protect the Issuers, the
Trustee, any Agent and any authenticating agent from any loss that any of them
may suffer if a Note is replaced.  The
Issuers may charge for their expenses in replacing a Note.

 

Every replacement Note is an additional obligation
of the Issuers and will be entitled to all of the benefits of this Indenture
equally and proportionately with all other Notes duly issued hereunder.

 

Section 2.08                                Outstanding
Notes.

 

The Notes outstanding at any time are all the Notes
authenticated by the Trustee except for those canceled by it, those delivered
to it for cancellation, those reductions in the interest in a Global Note
effected by the Trustee in accordance with the provisions hereof, and those
described in this Section as not outstanding.  Except as set forth in Section 2.09
hereof, a Note does not cease to be outstanding because the Issuers or an
Affiliate of the Issuers holds the Note; however, Notes held by the Issuers or
a Subsidiary of the Issuers shall not be deemed to be outstanding for purposes
of Section 2.08 hereof.

 

43

 

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

 

If the principal amount of any Note is considered
paid under Section 4.01 hereof, it ceases to be outstanding and interest
on it ceases to accrue.

 

If the Paying Agent (other than the Issuers, a
Subsidiary or an Affiliate of any thereof) holds, on a redemption date or maturity
date, money sufficient to pay Notes payable on that date, then on and after
that date such Notes will be deemed to be no longer outstanding and will cease
to accrue interest.

 

Section 2.09                                Treasury
Notes.

 

In determining whether the Holders of the required
principal amount of Notes have concurred in any direction, waiver or consent,
Notes owned by the Issuers, or by any Person directly or indirectly controlling
or controlled by or under direct or indirect common control with the Issuers,
will be considered as though not outstanding, except that for the purposes of
determining whether the Trustee will be protected in relying on any such
direction, waiver or consent, only Notes that a Responsible Officer of the
Trustee actually knows are so owned will be so disregarded.

 

Section 2.10                                Temporary
Notes.

 

Until certificates representing Notes are ready for
delivery, the Issuers may prepare and the Trustee, upon receipt of an
Authentication Order, will authenticate temporary Notes.  Temporary Notes will be substantially in the
form of certificated Notes but may have variations that the Issuers consider
appropriate for temporary Notes and as may be reasonably acceptable to the
Trustee.  Without unreasonable delay, the
Issuers will prepare and the Trustee will authenticate definitive Notes in
exchange for temporary Notes.

 

Holders of temporary Notes will be entitled to all
of the benefits of this Indenture.

 

Section 2.11                                Cancellation.

 

The Issuers at any time may deliver Notes to the
Trustee for cancellation.  The Registrar
and Paying Agent will forward to the Trustee any Notes surrendered to them for
registration of transfer, exchange or payment. 
The Trustee and no one else will cancel all Notes surrendered for
registration of transfer, exchange, payment, replacement or cancellation and
will dispose of such canceled Notes in accordance with its customary procedures
(subject to the record retention requirement of the Exchange Act).  The Issuers may not issue new Notes to replace
Notes that they have paid or that have been delivered to the Trustee for
cancellation.

 

Section 2.12                                Defaulted
Interest.

 

If the Issuers default in a payment of interest on
the Notes, they will pay the defaulted interest in any lawful manner plus, to
the extent lawful, interest payable on the defaulted interest, to the Persons
who are Holders on a subsequent special record date, in each case at the rate
provided in the Notes and in Section 4.01 hereof.  The Issuers will notify the Trustee in
writing

 

44

 

of the amount of defaulted
interest proposed to be paid on each Note and the date of the proposed
payment.  The Issuers will fix or cause
to be fixed each such special record date and payment date, provided that no such special record date
may be less than 10 days prior to the related payment date for such defaulted
interest.  At least 15 days before the
special record date, the Issuers (or, upon the written request of the Issuers,
the Trustee in the name and at the expense of the Issuers) will mail or cause
to be mailed to Holders a notice that states the special record date, the
related payment date and the amount of such interest to be paid.

 

Section 2.13                                CUSIP
Numbers.

 

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

 

ARTICLE 3.

REDEMPTION AND PREPAYMENT

 

Section 3.01                                Notices
to Trustee.

 

If the Issuers elect to redeem Notes pursuant to the
optional redemption provisions of Section 3.07 hereof, they must furnish
to the Trustee, at least 30 days but not more than 60 days before a redemption
date, an Officers’ Certificate setting forth:

 

(1)                                  the clause of
this Indenture pursuant to which the redemption shall occur;

 

(2)                                  the redemption
date;

 

(3)                                  the principal
amount of Notes to be redeemed; and

 

(4)                                  the redemption
price.

 

Section 3.02                                Selection
of Notes to Be Redeemed or Purchased.

 

If less than all of the Notes are to be redeemed or
purchased in an offer to purchase at any time, the Trustee will select Notes
for redemption or purchase as follows:

 

(1)                                  if the Notes
are listed on any national securities exchange, in compliance with the
requirements of the principal national securities exchange on which the Notes
are listed; or

 

45

 

(2)                                  if the Notes
are not listed on any national securities exchange, on a pro rata basis, by lot or in accordance
with a method which the Trustee shall deem fair and appropriate.

 

In the event of partial redemption or purchase by
lot, the particular Notes to be redeemed or purchased will be selected, unless
otherwise provided herein, not less than 30 nor more than 60 days prior to the
redemption or purchase date by the Trustee from the outstanding Notes not
previously called for redemption or purchase.

 

The Trustee will promptly notify the Issuers in
writing of the Notes selected for redemption or purchase and, in the case of
any Note selected for partial redemption or purchase, the principal amount
thereof to be redeemed or purchased. 
Notes and portions of Notes selected will be in amounts of $2,000 or
whole multiples of $1,000 in excess thereof; except that if all of the Notes of
a Holder are to be redeemed or purchased, the entire outstanding amount of
Notes held by such Holder, even if not a multiple of $1,000, shall be redeemed
or purchased.  Except as provided in the
preceding sentence, provisions of this Indenture that apply to Notes called for
redemption or purchase also apply to portions of Notes called for redemption or
purchase.

 

Section 3.03                                Notice
of Redemption.

 

Subject to the provisions of Section 3.09
hereof, at least 10 days but not more than 60 days before a redemption date,
the Issuers will mail or cause to be mailed, by first class mail, a notice of
redemption to each Holder whose Notes are to be redeemed at its registered
address, except that redemption notices may be mailed more than 60 days prior
to a redemption date if the notice is issued in connection with a defeasance of
the Notes or a satisfaction and discharge of this Indenture pursuant to
Articles 8 or 10 of this Indenture.

 

The notice will identify the Notes to be redeemed
(including CUSIP number(s)) and will state:

 

(1)                                  the redemption
date;

 

(2)                                  the redemption
price;

 

(3)                                  if any Note is
being redeemed in part, the portion of the principal amount of such Note to be
redeemed and that, after the redemption date upon surrender of such Note, a new
Note or Notes in principal amount equal to the unredeemed portion will be
issued upon cancellation of the original Note;

 

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

 

(5)                                  that Notes
called for redemption must be surrendered to the Paying Agent to collect the
redemption price;

 

(6)                                  that, unless
the Issuers default in making such redemption payment, interest on Notes called
for redemption ceases to accrue on and after the redemption date;

 

(7)                                  the paragraph
of the Notes and/or Section of this Indenture pursuant to which the Notes
called for redemption are being redeemed; and

 

46

 

(8)                                  that no representation
is made as to the correctness or accuracy of the CUSIP number, if any, listed
in such notice or printed on the Notes.

 

At the Issuers’ request, the Trustee will give the
notice of redemption in the Issuers’ name and at their expense; provided, however, that the Issuers have
delivered to the Trustee, at least 45 days prior to the redemption date, an
Officers’ Certificate requesting that the Trustee give such notice and setting
forth the information to be stated in such notice as provided in the preceding
paragraph.

 

Section 3.04                                Effect
of Notice of Redemption.

 

Once notice of redemption is mailed in accordance
with Section 3.03 hereof, Notes called for redemption become irrevocably
due and payable on the redemption date at the redemption price.  A notice of redemption may not be conditional.

 

Section 3.05                                Deposit
of Redemption or Purchase Price.

 

One Business Day prior to or prior to 11:00 a.m.
Eastern Time on the redemption or purchase price date, the Issuers will deposit
with the Trustee or with the Paying Agent money sufficient to pay the
redemption or purchase price of and accrued interest on all Notes to be
redeemed or purchased on that date.  The
Trustee or the Paying Agent will promptly return to the Issuers any money
deposited with the Trustee or the Paying Agent by the Issuers in excess of the
amounts necessary to pay the redemption or purchase price of, and accrued
interest on, all Notes to be redeemed or purchased.

 

If the Issuers comply with the provisions of the
preceding paragraph, on and after the redemption or purchase date, interest
will cease to accrue on the Notes or the portions of Notes called for
redemption or purchase.  If a Note is
redeemed or purchased on or after an interest record date but on or prior to
the related interest payment date, then any accrued and unpaid interest shall
be paid to the Person in whose name such Note was registered at the close of
business on such record date.  If any
Note called for redemption or purchase is not so paid upon surrender for
redemption or purchase because of the failure of the Issuers to comply with the
preceding paragraph, interest shall be paid on the unpaid principal, from the
redemption or purchase date until such principal is paid, and to the extent
lawful on any interest not paid on such unpaid principal, in each case at the
rate provided in the Notes and in Section 4.01 hereof.

 

Section 3.06                                Notes
Redeemed or Purchased in Part.

 

Upon surrender of a Note that is redeemed or
purchased in part, the Issuers will issue and, upon receipt of an
Authentication Order, the Trustee will authenticate for the Holder at the
expense of the Issuers a new Note equal in principal amount to the unredeemed
or unpurchased portion of the Note surrendered.

 

Section 3.07                                Optional
Redemption.

 

(a)                                  The Notes are not redeemable
at the Issuers’ option prior to October 1, 2013.

 

(b)                                 On and after October 1,
2013, the Issuers may redeem the Notes, in whole or in part, upon not less than
30 nor more than 60 days’ notice, at the redemption prices (expressed in 

 

47

 

percentages of principal amount) listed in the table
below, plus accrued and unpaid interest on the Notes to the applicable
redemption date, if redeemed during the twelve months beginning on October 1
of the years indicated below:

 

	
  Year

  	
   

  	
  Percentage

  	
   

  
	
  2013

  	
   

  	
  104.563

  	
  %

  
	
  2014

  	
   

  	
  102.281

  	
  %

  
	
  2015 and thereafter

  	
   

  	
  100.000

  	
  %

  

 

(c)                                  Any redemption pursuant to
this Section 3.07 shall be made pursuant to the provisions of Section 3.01
through 3.06 hereof.

 

Section 3.08                                Mandatory
Redemption.

 

The Issuers are not required to make any mandatory
redemption or sinking fund payments with respect to the Notes.  The Issuers may at any time and from time to
time purchase Notes in the open market or otherwise.

 

Section 3.09                                Offer to
Purchase by Application of Excess Proceeds.

 

In the event that, pursuant to Section 4.10
hereof, the Issuers are required to commence an offer to all Holders to
purchase Notes (an “Asset Sale Offer”),
they will follow the procedures specified below.

 

The Asset Sale Offer shall be made to all Holders
and all holders of other Indebtedness that is pari
passu with the Notes containing provisions similar to those set
forth in this Indenture with respect to offers to purchase or redeem with the
proceeds of sales and assets.  The Asset
Sale Offer will remain open for a period of at least 20 Business Days following
its commencement and not more than 30 Business Days, except to the extent that
a longer period is required by applicable law (the “Offer Period”).  No later
than three Business Days after the termination of the Offer Period (the “Purchase Date”), the Issuers will apply
all Excess Proceeds (the “Offer Amount”)
to the purchase of Notes and such other pari
passu Indebtedness (on a pro rata basis, if applicable) or, if less
than the Offer Amount has been tendered, all Notes and other Indebtedness
tendered in response to the Asset Sale Offer. 
Payment for any Notes so purchased will be made in the same manner as
interest payments are made.

 

If the Purchase Date is on or after an interest
record date and on or before the related interest payment date, any accrued and
unpaid interest will be paid to the Person in whose name a Note is registered
at the close of business on such record date, and no additional interest will
be payable to Holders who tender Notes pursuant to the Asset Sale Offer.

 

Upon the commencement of an Asset Sale Offer, the
Issuers will send, by first class mail, a notice to the Trustee and each of the
Holders, with a copy to the Trustee.  The
notice will contain all instructions and materials necessary to enable such
Holders to tender Notes pursuant to the Asset Sale Offer.  The notice, which will govern the terms of
the Asset Sale Offer, will state:

 

48

 

(1)                                  that the Asset
Sale Offer is being made pursuant to this Section 3.09 and Section 4.10
hereof and the length of time the Asset Sale Offer will remain open;

 

(2)                                  the Offer
Amount, the purchase price and the Purchase Date;

 

(3)                                  that any Note
not tendered or accepted for payment will continue to accrue interest;

 

(4)                                  that, unless
the Issuers default in making such payment, any Note accepted for payment
pursuant to the Asset Sale Offer will cease to accrue interest after the
Purchase Date;

 

(5)                                  that Holders
electing to have a Note purchased pursuant to an Asset Sale Offer may elect to
have Notes purchased only in denominations of $2,000 and integral multiples of
$1,000 in excess thereof;

 

(6)                                  that Holders
electing to have a Note purchased pursuant to any Asset Sale Offer will be
required to surrender the Note, with the form entitled “Option of Holder to
Elect Purchase” on the reverse of the Note completed, or transfer by book-entry
transfer, to the Issuers, a Depositary, if appointed by the Issuers, or a
Paying Agent at the address specified in the notice at least three days before
the Purchase Date;

 

(7)                                  that Holders
will be entitled to withdraw their election if the Issuers, the Depositary or
the Paying Agent, as the case may be, receives, not later than the expiration
of the Offer Period, a facsimile transmission or letter setting forth the name
of the Holder, the principal amount of the Note the Holder delivered for
purchase and a statement that such Holder is withdrawing his election to have
such Note purchased;

 

(8)                                  that, if the
aggregate principal amount of Notes and other pari
passu Indebtedness surrendered by Holders exceeds the Offer Amount,
the Issuers will select the Notes and other pari
passu Indebtedness to be purchased on a pro rata basis based on the principal amount of Notes and
such other pari passu
Indebtedness surrendered (with such adjustments as may be deemed appropriate by
the Issuers so that only Notes in denominations of $2,000, or integral
multiples in excess thereof, will be purchased); and

 

(9)                                  that Holders
whose Notes were purchased only in part will be issued new Notes equal in
principal amount to the unpurchased portion of the Notes surrendered (or
transferred by book-entry transfer).

 

On or before the Purchase Date, the Issuers will, to
the extent lawful, accept for payment, on a pro
rata basis to the extent necessary, the Offer Amount of Notes or
portions thereof tendered pursuant to the Asset Sale Offer, or if less than the
Offer Amount has been tendered, all Notes tendered, and will deliver to the
Trustee an Officers’ Certificate stating that such Notes or portions thereof
were accepted for payment by the Issuers in accordance with the terms of this Section 3.09.  The Issuers, the Depositary or the Paying
Agent, as the case may be, will promptly (but in any case not later than five
days after the Purchase Date) mail or deliver to each tendering Holder an
amount equal to the purchase price of the Notes tendered by such Holder and
accepted by the Issuers for purchase, and the Issuers will promptly issue a new
Note, and the Trustee, 

 

49

 

upon written request from
the Issuers will authenticate and mail or deliver such new Note to such Holder,
in a principal amount equal to any unpurchased portion of the Note
surrendered.  Any Note not so accepted
shall be promptly mailed or delivered by the Issuers to the Holder
thereof.  The Issuers will publicly
announce the results of the Asset Sale Offer on the Purchase Date.

 

Other than as specifically provided in this Section 3.09,
any purchase pursuant to this Section 3.09 shall be made pursuant to the
provisions of Sections 3.01 through 3.06 hereof.

 

ARTICLE 4.

COVENANTS

 

Section 4.01                                Payment
of Notes.

 

The Issuers will pay or cause to be paid the
principal of, premium, if any, and interest on the Notes on the dates and in
the manner provided in the Notes. 
Principal, premium, if any, and interest will be considered paid on the
date due if the Paying Agent, if other than the Issuers or a Subsidiary
thereof, holds as of 10:00 a.m. Eastern Time on the due date money
deposited by the Issuers in immediately available funds and designated for and
sufficient to pay all principal, premium, if any, and interest then due.

 

The Issuers will pay interest (including
post-petition interest in any proceeding under any Bankruptcy Law) on overdue
principal at the rate equal to 1% per annum in excess of the then applicable
interest rate on the Notes to the extent lawful; they will pay interest
(including post-petition interest in any proceeding under any Bankruptcy Law)
on overdue installments of interest (without regard to any applicable grace
period) at the same rate to the extent lawful.

 

Section 4.02                                Maintenance
of Office or Agency.

 

The Issuers will maintain in the Borough of
Manhattan, the City of New York, an office or agency (which may be an office of
the Trustee or an affiliate of the Trustee, Registrar or co-registrar) where
Notes may be surrendered for registration of transfer or for exchange and where
notices and demands to or upon the Issuers in respect of the Notes and this
Indenture may be served.  The Issuers
will give prompt written notice to the Trustee of the location, and any change
in the location, of such office or agency. 
If at any time the Issuers fail to maintain any such required office or
agency or fails to furnish the Trustee with the address thereof, such
presentations, surrenders, notices and demands may be made or served at the
Corporate Trust Office of the Trustee.

 

The Issuers may also from time to time designate one
or more other offices or agencies where the Notes may be presented or
surrendered for any or all such purposes and may from time to time rescind such
designations; provided, however,
that no such designation or rescission will in any manner relieve the Issuers
of their obligation to maintain an office or agency in the Borough of
Manhattan, the City of New York for such purposes.  The Issuers will give prompt written notice
to the Trustee of any such designation or rescission and of any change in the
location of any such other office or agency.

 

The Issuers hereby designate the Corporate Trust
Office of the Trustee as one such office or agency of the Issuers in accordance
with Section 2.03 hereof.

 

50

 

Section 4.03                                Reports.

 

(a)                                  Whether or not required by
the rules and regulations of the SEC, so long as any Notes are
outstanding, the Issuers will furnish to the Holders of Notes, within the time
periods specified in the SEC’s rules and regulations:

 

(1)                                  all quarterly
and annual financial information that would be required to be contained in a
filing with the SEC on Forms 10-Q and 10-K if the Issuers were required to file
such forms, including a “Management’s Discussion and Analysis of Financial
Condition and Results of Operations” and, with respect to the annual financial
information only, a report thereon by the Issuers’ certified independent
accountants; and

 

(2)                                  all current
reports that would be required to be filed with the SEC on Form 8-K if the
Issuers were required to file such reports.

 

In addition, whether or not required by the rules and
regulations of the SEC, the Issuers will file a copy of all of the information
and reports referred to in clauses (1) and (2) above with the SEC for
public availability within the time periods specified in the SEC’s rules and
regulations (unless the SEC will not accept such a filing) and make such
information available to investors who request it in writing.  The Issuers will promptly furnish to Holders
of Notes notices of (a) any Payment Default under any instrument
evidencing Indebtedness for borrowed money, and (b) any acceleration of
such Indebtedness prior to its express maturity. The Issuers will at all times
comply with TIA § 314(a).

 

Section 4.04                                Compliance
Certificate.

 

(a)                                  The Issuers shall deliver to
the Trustee, within 90 days after the end of each fiscal year, an Officers’
Certificate stating that a review of the activities of the Issuers and their
Subsidiaries during the preceding fiscal year has been made under the
supervision of the signing Officers with a view to determining whether the
Issuers has kept, observed, performed and fulfilled their obligations under
this Indenture, and further stating, as to each such Officer signing such
certificate, that, to the best of his or her knowledge, the Issuers have kept,
observed, performed and fulfilled each and every covenant contained in this
Indenture and are not in default in the performance or observance of any of the
terms, provisions and conditions of this Indenture (or, if a Default or Event
of Default has occurred, describing all such Defaults or Events of Default of
which he or she may have knowledge and what action the Issuers are taking or
propose to take with respect thereto) and that, to the best of his or her
knowledge, no event has occurred and remains in existence by reason of which
payments on account of the principal of or interest, if any, on the Notes is
prohibited or if such event has occurred, a description of the event and what
action the Issuers are taking or propose to take with respect thereto.

 

(b)                                 So long as not contrary to
the then current recommendations of the American Institute of Certified Public
Accountants, the year-end financial statements delivered pursuant to Section 4.03(a) above
shall be accompanied by a written statement of the Issuers’ independent public
accountants (who shall be a firm of established national reputation) that in
making the examination necessary for certification of such financial
statements, nothing has come to their attention that would lead them to believe
that the Issuers have violated any provisions of Article 4 or Article 5
hereof or, if any such violation has occurred, specifying the nature and period
of 

 

51

 

existence thereof, it being understood that such
accountants shall not be liable directly or indirectly to any Person for any
failure to obtain knowledge of any such violation.

 

(c)                                  So long as any of the Notes
are outstanding, the Issuers will deliver to the Trustee, forthwith upon any
Officer becoming aware of any Default or Event of Default, an Officers’
Certificate specifying such Default or Event of Default and what action the
Issuers are taking or propose to take with respect thereto.

 

Section 4.05                                Taxes.

 

The Issuers will pay, and will cause each of their
Subsidiaries to pay, prior to delinquency, all material taxes, assessments, and
governmental levies except such as are contested in good faith and by
appropriate proceedings or where the failure to effect such payment is not
adverse in any material respect to the Holders of the Notes.

 

Section 4.06                                Stay,
Extension and Usury Laws.

 

The Issuers covenant (to the extent that they may
lawfully do so) that they will not at any time insist upon, plead, or in any
manner whatsoever claim or take the benefit or advantage of, any stay,
extension or usury law wherever enacted, now or at any time hereafter in force,
that may affect the covenants or the performance of this Indenture; and the
Issuers (to the extent that they may lawfully do so) hereby expressly waive all
benefit or advantage of any such law, and covenant that they will not, by
resort to any such law, hinder, delay or impede the execution of any power
herein granted to the Trustee, but will suffer and permit the execution of
every such power as though no such law has been enacted.

 

Section 4.07                                Restricted
Payments.

 

(a)                                  The Partnership will not,
and will not permit any of its Restricted Subsidiaries to, directly or indirectly,
(all such payments and other actions set forth in these clauses (1) through
(4) below being collectively referred to as a “Restricted Payment”):

 

(1)                                  declare or pay
any dividend or any other distribution or payment on or with respect to Capital
Stock of the Partnership or any of its Restricted Subsidiaries or any payment
made to the direct or indirect holders, in their capacities as such, of Capital
Stock of the Partnership or any of its Restricted Subsidiaries other than (a) dividends
or distributions payable solely in Capital Stock of the Partnership (excluding
Redeemable Capital Stock), or in options, warrants or other rights to purchase
Capital Stock of the Partnership (excluding Redeemable Capital Stock); (b) dividends
or other distributions to the extent declared or paid to the Partnership or any
Restricted Subsidiary of the Partnership; or (c) dividends or other
distributions by any Restricted Subsidiary of the Partnership to all holders of
Capital Stock of that Restricted Subsidiary on a pro rata basis, including to
the General Partner of the Partnership;

 

(2)                                  purchase,
redeem, defease or otherwise acquire or retire for value any Capital Stock of
the Partnership or any of its Restricted Subsidiaries, other than any Capital
Stock owned the Partnership or a Restricted Subsidiary of the Partnership;

 

52

 

(3)                                  make any
principal payment on, or purchase, defease, repurchase, redeem or otherwise
acquire or retire for value, prior to any scheduled maturity, scheduled
repayment, scheduled sinking fund payment or other stated maturity, any
subordinated Indebtedness, other than any such Indebtedness owned by the
Partnership or a Restricted Subsidiary of the Partnership; or

 

(4)                                  make any
investment, other than a Permitted Investment, in any entity,

 

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

 

(1)                                  no Default or
Event of Default has occurred and is continuing; and

 

(2)                                  the Restricted
Payment, together with the aggregate of all other Restricted Payments made by
the Partnership and its Restricted Subsidiaries during the fiscal quarter
during which the Restricted Payment is made will not exceed:

 

(A) if the Consolidated Fixed Charge Coverage Ratio of the
Partnership is greater than 1.75 to 1.00, an amount equal to Available Cash for
the immediately preceding fiscal quarter; or

 

(B) if the Consolidated Fixed Charge Coverage Ratio of the
Partnership is equal to or less than 1.75 to 1.00, an amount equal to the sum
of $50 million, less the aggregate amount of all Restricted Payments made by
the Partnership and its Restricted Subsidiaries in accordance with this clause
during the period ending on the last day of the fiscal quarter of the
Partnership immediately preceding the date of the Restricted Payment and
beginning on the first day of the sixteenth full fiscal quarter immediately
preceding the date of the Restricted Payment plus the aggregate net cash
proceeds of capital contributions to the Partnership from any Person other than
a Restricted Subsidiary of the Partnership, or issuance and sale of shares of
Capital Stock, other than Redeemable Capital Stock, of the Partnership to any
entity other than to a Restricted Subsidiary of the Partnership, in any case
made during the period ending on the last day of the fiscal quarter of the
Partnership immediately preceding the date of the Restricted Payment and
beginning on the first day of the sixteenth full fiscal quarter immediately
preceding the date of the Restricted Payment.

 

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

 

(1)                                  the payment of
any dividend or distribution within 60 days after the date of its declaration
if, at the date of declaration, the payment would be permitted as stated above;

 

(2)                                  the redemption,
repurchase or other acquisition or retirement of any shares of any class of
Capital Stock of the Partnership or any Restricted Subsidiary of the
Partnership in exchange for, or out of the net cash proceeds of, a
substantially concurrent capital contribution to the Partnership from any
entity other than a Restricted Subsidiary of the Partnership; or issuance and
sale of other Capital Stock, other than Redeemable Capital Stock, of the
Partnership to any entity other than to a Restricted Subsidiary of the 

 

53

 

Partnership;
provided, however, that the
amount of any net cash proceeds that are utilized for any redemption,
repurchase or other acquisition or retirement will be excluded from the
calculation of Available Cash; or

 

(3)                                  any redemption,
repurchase or other acquisition or retirement of subordinated Indebtedness in
exchange for, or out of the net cash proceeds of, a substantially concurrent
capital contribution to the Partnership from any entity other than a Restricted
Subsidiary of the Partnership; or issuance and sale of Indebtedness of the
Partnership issued to any entity other than a Restricted Subsidiary or the
Partnership, so long as the Indebtedness is Permitted Refinancing Indebtedness;
provided, however, that the amount
of any net cash proceeds that are utilized for any redemption, repurchase or
other acquisition or retirement will be excluded from the calculation of
Available Cash.

 

In computing the amount of Restricted Payments in Section 4.07(a) above,
the Restricted Payments permitted by clause (1) of this paragraph (b) will
be included and the Restricted Payments permitted by clauses (2) and (3) of
this paragraph (b) will not be included.

 

The amount of all Restricted Payments (other than
cash) will be the fair market value on the date of the Restricted Payment of
the assets proposed to be transferred by the Partnership or such Restricted
Subsidiary, as the case may be, pursuant to the Restricted Payment.  The fair market value of any assets that are
required to be valued by this Section 4.07 will be determined in good
faith by an authorized financial officer of the General Partner on the date of
the Restricted Payment of the assets proposed to be transferred.

 

Section 4.08                                Dividend
and Other Payment Restrictions Affecting Subsidiaries.

 

(a)                                  The Partnership will not,
and will not permit any of its Restricted Subsidiaries to, create or otherwise
cause or suffer to exist or become effective any encumbrance or restriction on
the ability of any Restricted Subsidiary to:

 

(1)                                  pay dividends,
in cash or otherwise, or make any other distributions on or with respect to its
Capital Stock or any other interest or participation in, or measured by, its
profits;

 

(2)                                  pay any
Indebtedness owed to the Partnership or any other Restricted Subsidiary;

 

(3)                                  make loans or
advances to, or any investment in, the Partnership or any other Restricted
Subsidiary;

 

(4)                                  transfer any of
its properties or assets to the Partnership or any other Restricted Subsidiary;
or

 

(5)                                  guarantee any
Indebtedness of the Partnership or any other Restricted Subsidiary.

 

All such restrictions and other actions set forth in
these clauses (1) through (5) above being collectively referred to as
“Payment Restrictions.”

 

54

 

(b)                                 The provisions of Section 4.08(a) will
not apply to (and therefore the following are permitted) encumbrances or
restrictions existing under or by reason of:

 

(1)                                  applicable law;

 

(2)                                  any agreement
in effect at or entered into on the date of this Indenture or any agreement
relating to any Indebtedness permitted to be incurred under this Indenture, or
with respect to any Credit Facility (including agreements or instruments
evidencing Indebtedness incurred after the date of this Indenture); provided, however, that the encumbrances
and restrictions contained in the agreements governing such permitted
Indebtedness are not materially more restrictive with respect to the Payment
Restrictions than those set forth in the agreements governing the Partnership’s
existing Indebtedness as in effect on the date of this Indenture;

 

(3)                                  customary
non-assignment provisions of any contract or any lease governing a leasehold
interest of the Partnership or any Restricted Subsidiary;

 

(4)                                  specific
purchase money obligations or Capital Leases for property subject to such
obligations;

 

(5)                                  any agreement
of an entity (or any it its Restricted Subsidiaries) acquired by the
Partnership or any Restricted Subsidiary, in existence at the time of the
acquisition but not created in contemplation of the acquisition, which
encumbrance or restriction is not applicable to any third party other than the
entity; or

 

(6)                                  provisions
contained in instruments relating to Indebtedness which prohibit the transfer
of all or substantially all of the assets of the obligor of the Indebtedness
unless the transferee shall assume the obligations of the obligor under the
agreement or instrument.

 

Section 4.09                                Incurrence
of Indebtedness.

 

(a)                                  The Partnership will not,
and will not permit any of its Restricted Subsidiaries to, directly or
indirectly, create, incur, issue, assume, guarantee or in any manner become
directly or indirectly liable, contingently or otherwise, for the payment, in
each case, to “incur,” any
Indebtedness, unless at the time of the incurrence and after giving pro forma
effect to the receipt and application of the proceeds of the Indebtedness, the
Consolidated Fixed Charge Coverage Ratio of the Partnership is greater than
2.00 to 1.00.

 

(b)                                 The provisions of Section 4.09(a) will
not prohibit the incurrence by the Partnership and its Restricted Subsidiary of
any of the following items of Indebtedness (collectively, “Permitted Indebtedness”):

 

(1)                                  Indebtedness
outstanding as of the date of this Indenture;

 

(2)                                  Indebtedness of
the Partnership or a Restricted Subsidiary incurred for the making of
expenditures for the improvement or repair, to the extent the improvements or
repairs may be capitalized in accordance with GAAP, or additions, including by
way of acquisitions of businesses and related assets, to the property and
assets of the Partnership

 

55

 

and
its Restricted Subsidiaries, including, without limitation, the acquisition of
assets subject to operating leases, Indebtedness incurred under the Credit
Facilities, or incurred by assumption in connection with additions, including
additions by way of acquisitions or capital contributions of businesses and
related assets, to the property and assets of the Partnership and its
Restricted Subsidiaries; provided,
that the aggregate principal amount of this Indebtedness outstanding at any
time may not exceed $75 million;

 

(3)           Indebtedness of
the Partnership or a Restricted Subsidiary (a) incurred for any purpose
permitted under the Credit Facilities, or (b) owing in respect of any
Accounts Receivable Securitization, operating lease, or other off-balance sheet
obligation existing on the date of this Indenture that arises because, after
the date of this Indenture, such off-balance sheet obligations are refinanced
with Indebtedness, provided, that
the aggregate principal amount of this Indebtedness outstanding under this
clause at any time may not exceed an amount equal to the sum of (x) $500
million plus (y) the amount, if any, by which the Borrowing Base as of the
date of calculation exceeds the amount of the Borrowing Base as of December 31,
2003;

 

(4)           Indebtedness of
the Partnership owed to the General Partner or an Affiliate of the General
Partner that is unsecured and that is subordinated in right of payment to the
Notes; provided, that the
aggregate principal amount of this Indebtedness outstanding at any time under
this clause may not exceed $50 million and this Indebtedness has a final
maturity date later than the final maturity date of the Notes;

 

(5)           Indebtedness
owed by the Partnership to any Restricted Subsidiary or owed by any Restricted
Subsidiary to the Partnership or to any other Restricted Subsidiary;

 

(6)           Permitted
Refinancing Indebtedness (including, for the avoidance of doubt, Indebtedness
incurred as permitted under the Consolidated Fixed Charge Coverage Ratio set
forth in Section 4.09(a) above);

 

(7)           the incurrence
by the Partnership or a Restricted Subsidiary of Indebtedness owing directly to
its insurance carriers, without duplication, in connection with the
Partnership’s, its Subsidiaries’ or its Affiliates’ self-insurance programs or
other similar forms of retained insurable risks for their respective
businesses, consisting of reinsurance agreements and indemnification
agreements, and guarantees of the foregoing, secured by letters of credit; provided, that any Consolidated Fixed
Charges associated with the Indebtedness evidenced by the reinsurance
agreements, indemnification agreements, guarantees and letters of credit will
be included, without duplication, in any determination of the Consolidated
Fixed Charge Coverage Ratio test set forth in Section 4.09(a) above;

 

(8)           Indebtedness of
the Partnership and its Restricted Subsidiaries in respect of Capital Leases,
meaning, generally, any lease of any property which would be required to be
classified and accounted for as a capital lease on a balance sheet of the
lessor; provided, that the
aggregate amount of this Indebtedness outstanding at any time may not exceed
$30 million;

 

56

 

(9)           Indebtedness of
the Partnership and its Restricted Subsidiaries represented by letters of
credit supporting (a) obligations under workmen’s compensation laws, (b) obligations
to suppliers of propane or energy commodity derivative providers in the
ordinary course of business consistent with past practices not to exceed $15
million at any one time outstanding and (c) the repayment of Indebtedness
permitted to be incurred under this Indenture;

 

(10)         surety bonds
and appeal bonds required in the ordinary course of business or in connection
with the enforcement of rights or claims of the Partnership or any of its
Subsidiaries or in connection with judgments that do not result in a Default or
Event of Default;

 

(11)         Indebtedness of
the Partnership or its Restricted Subsidiaries incurred in connection with
acquisitions of retail propane businesses in favor of the sellers of such
businesses in an aggregate principal amount not to exceed $20 million in any
fiscal year and not to exceed $70 million at any one time outstanding; provided, that the principal amount of
such Indebtedness incurred in connection with any such acquisition shall not
exceed the fair market value of the assets so acquired and, to the extent
issued by the Partnership, such Indebtedness is expressly subordinated to the
Notes;

 

(12)         unsecured
Indebtedness of the Partnership or its Restricted Subsidiaries which is not
otherwise a Permitted Indebtedness in an aggregate outstanding amount not to
exceed the greater of (a) $50 million and (b) 5% of Consolidated Net
Tangible Assets; and

 

(13)         the Notes
(other than Additional Notes) and the Exchange Notes.

 

For purposes of determining compliance with this Section 4.09,
in the event that an item of Indebtedness meets the criteria of more than one
of the categories of Permitted Indebtedness described in clauses (1) through
(13) above or is entitled to be incurred in compliance with the Consolidated
Fixed Charge Coverage Ratio pursuant to Section 4.09(a) above, the
Partnership, may, in its sole discretion, classify (or later reclassify) in
whole or in part such items of Indebtedness in any manner that complies with
this Section 4.09, and such item of Indebtedness or a portion thereof may
be classified (or later reclassified) in whole or in part as having been
incurred under more than one of the applicable clauses of Permitted
Indebtedness or in compliance with the Consolidated Fixed Charge Coverage Ratio
set forth in Section 4.09(a) above.

 

Section 4.10           Asset
Sales.

 

The Partnership will not, and will not permit any of
its Restricted Subsidiaries to, complete an Asset Sale unless:

 

(1)           the Partnership
or its Restricted Subsidiary, as the case may be, receives consideration at the
time of such Asset Sale at least equal to the fair market value, as determined
in good faith by an authorized financial officer of the General Partner, of the
assets sold or otherwise disposed of; and

 

57

 

(2)           if such Asset
Sale involves assets with a fair market value in excess of $10 million, at
least 75% of the consideration therefor received by the Partnership or such
Restricted Subsidiary is in the form of cash.

 

For purposes of determining the amount of cash
received in an Asset Sale, each of the following shall be deemed to be cash:

 

(1)           the amount of
any liabilities on the Partnership’s or any Restricted Subsidiary’s balance
sheet that are assumed by the transferee of the assets; and

 

(2)           the amount of
any notes or other obligations received by the Partnership or the Restricted
Subsidiary from the transferee that is converted within 180 days by the
Partnership or the Restricted Subsidiary into cash, to the extent of the cash
received.

 

Furthermore, the 75% limitation will not apply to
any Asset Sale in which the cash portion of the consideration received is equal
to or greater than the after-tax proceeds would have been had the Asset Sale
complied with the 75% limitation.

 

If the Partnership or any of its Restricted
Subsidiaries receives Net Proceeds exceeding $20 million from one or more Asset
Sales in any fiscal year, then within 365 days after the date the aggregate
amount of Net Proceeds exceeds $20 million, the Partnership must apply the
amount of such Net Proceeds either:

 

(1)           to reduce
Indebtedness of the Partnership or any of its Restricted Subsidiaries, with a
permanent reduction of availability in the case of revolving Indebtedness; or

 

(2)           to make an
investment in assets or capital expenditures useful to the Partnership’s or any
of its Subsidiaries’ business as in effect on the date of this Indenture or
business related or ancillary thereto.

 

Pending the final application of any such Net
Proceeds, the Partnership or any Restricted Subsidiary may temporarily reduce
borrowings under the Credit Facilities or otherwise invest such Net Proceeds in
any manner that is not prohibited by this Indenture.

 

Any Net Proceeds from Asset Sales that are not
applied or invested as provided above will be considered “Excess Proceeds.”  When the aggregate amount of Excess Proceeds
exceeds $20 million, within 15 days thereof, the Issuers will make an Asset
Sale Offer to all Holders of Notes and all holders of other Indebtedness
outstanding that is pari passu
with the Notes containing provisions similar to those set forth in this
Indenture with respect to offers to purchase or redeem with the proceeds of
sales of assets in accordance with Section 3.09 hereof to purchase for
cash the maximum principal amount of Notes and such other pari passu Indebtedness that may be
purchased out of the Excess Proceeds. The offer price in any Asset Sale Offer
will be equal to 100% of principal amount plus accrued and unpaid interest to
the date of purchase.  To the extent that
the aggregate amount of Notes tendered in response to the Issuers’ purchase
offer is less than the Excess 

 

58

 

Proceeds, the Partnership or
any Restricted Subsidiary may use such deficiency for general business
purposes.  If the aggregate principal
amount of Notes and such other pari passu
Indebtedness tendered into such Asset Sale Offer exceeds the amount of Excess
Proceeds, the Trustee shall select the Notes and such other pari passu Indebtedness to be purchased on
pro rata basis in proportion to the aggregate principal amount of Notes and
such other pari passu
Indebtedness tendered.  Upon completion
of each Asset Sale Offer, the amount of Excess Proceeds shall be reset at zero.

 

The Issuers will comply with the requirements of Rule 14e-1
under the Exchange Act and any other securities laws and regulations thereunder
to the extent such laws and regulations are applicable in connection with each
repurchase of Notes pursuant to an Asset Sale Offer.  To the extent that the provisions of any
securities laws or regulations conflict with the provisions of Sections 3.09 or
4.10 of this Indenture, the Issuers will comply with the applicable securities
laws and regulations and will not be deemed to have breached their obligations
under those provisions of this Indenture by virtue of such conflict.

 

Section 4.11           Transactions
with Affiliates.

 

(a)           The Partnership will not, and will not permit any of
its Restricted Subsidiaries to, directly or indirectly, enter into or suffer to
exist any transaction or series of related transactions, including the sale,
transfer, disposition, purchase, exchange or lease of assets, property or services,
other than as provided for in the 
partnership agreement or other organizational documents, as applicable,
and the other agreements entered into between the Partnership and any of its
Affiliates, with, or for the benefit of, any Affiliates of the Partnership
(each an “Affiliate Transaction”),
unless:

 

(1)           the transaction
or series of related transactions are between the Partnership and its
Restricted Subsidiaries or between two Restricted Subsidiaries; or

 

(2)           the transaction
or series of related transactions are on terms that are no less favorable to
the Partnership or the Restricted Subsidiary, as the case may be, than those
which would have been obtained in a comparable transaction at such time from an
entity that is not an Affiliate of the Partnership or Restricted Subsidiary,
and, with respect to transaction(s) involving aggregate payments or value
equal to or greater than $20 million, the Partnership delivers an Officers’
Certificate to the Trustee certifying that the transaction(s) is on terms
that are no less favorable to the Partnership or the Restricted Subsidiary than
those which would have been obtained from an entity that is not an Affiliate of
the Partnership or Restricted Subsidiary and has been approved by a majority of
the Board of Directors of the General Partner, including a majority of the
disinterested directors.

 

(b)           The following items will not be deemed to be
Affiliate Transactions and, therefore, will not be subject to the provisions of
Section 4.11(a) or otherwise be restricted by this Indenture or the
Notes:

 

(1)           any employment
agreement, stock option agreement, restricted stock agreement, employee stock
ownership plan related agreements, or similar agreement and arrangements, in
the ordinary course of business;

 

(2)           transactions
permitted by Section 4.07 hereof;

 

59

 

(3)           transactions in
the ordinary course of business in connection with reinsuring the
self-insurance programs or other similar forms of retained insurable risks of the
retail propane business operated by the Partnership, its Subsidiaries and
Affiliates;

 

(4)           any Accounts
Receivable Securitization;

 

(5)           any affiliate
trading transactions done in the ordinary course of business; and

 

(6)           any transaction
that is a Flow-Through Acquisition.

 

Section 4.12           Liens.

 

The Partnership will not, and will not permit any of
its Restricted Subsidiaries to incur any Liens or other encumbrance, unless the
Lien is a Permitted Lien or the Notes are directly secured equally and ratably
with the obligation or liability secured by such Lien.

 

Section 4.13           Corporate
Existence.

 

Subject to Article 5 hereof, the Partnership
shall do or cause to be done all things necessary to preserve and keep in full
force and effect:

 

(1)           its partnership
existence, and the corporate, partnership or other existence of each of its
Restricted Subsidiaries, in accordance with the respective organizational
documents (as the same may be amended from time to time) of the Partnership or
any such Restricted Subsidiary; and

 

(2)           the rights
(charter and statutory), licenses and franchises of the Partnership and its
Restricted Subsidiaries; provided, however,
that the Partnership shall not be required to preserve any such right, license
or franchise, or the corporate, partnership or other existence of any of its
Restricted Subsidiaries, if the Board of Directors shall determine that the
preservation thereof is no longer desirable in the conduct of the business of
the Partnership and its Restricted Subsidiaries, taken as a whole, and that the
loss thereof is not adverse in any material respect to the Holders of the
Notes.

 

Section 4.14           Offer
to Repurchase Upon Change of Control.

 

(a)           Upon the occurrence of a Change of Control, the
Issuers will make an offer (a “Change of
Control Offer”) to each Holder to repurchase, in cash, all or any
part (equal to $2,000 or an integral multiple of $1,000 in excess thereof) of
that Holder’s Notes at a purchase price equal to 101% of the aggregate
principal amount of the Notes or portion of Notes validly tendered for payment
thereof plus accrued and unpaid interest on the Notes repurchased, if any, to
the date of purchase (the “Change of Control
Payment”). Within 30 days following any Change of Control, the
Issuers will mail a notice to each Holder describing the transaction or
transactions that constitute the Change of Control and stating:

 

(1)           that the Change
of Control Offer is being made pursuant to this Section 4.14 and that all
Notes tendered will be accepted for payment;

 

60

 

(2)           the purchase
price and the purchase date, which shall be no later than 30 Business Days from
the date such notice is mailed (the “Change
of Control Payment Date”);

 

(3)           that any Note
not tendered will continue to accrue interest;

 

(4)           that, unless
the Issuers defaults in the payment of the Change of Control Payment, all Notes
accepted for payment pursuant to the Change of Control Offer will cease to
accrue interest after the Change of Control Payment Date;

 

(5)           that Holders
electing to have any Notes purchased pursuant to a Change of Control Offer will
be required to surrender the Notes, with the form entitled “Option of Holder to
Elect Purchase” on the reverse of the Notes completed, to the Paying Agent at
the address specified in the notice prior to the close of business on the third
Business Day preceding the Change of Control Payment Date;

 

(6)           that Holders
will be entitled to withdraw any election to have their Notes purchased if the
Paying Agent receives, not later than the close of business on the second
Business Day preceding the Change of Control Payment Date, a facsimile
transmission or letter setting forth the name of the Holder, the principal
amount of Notes delivered for purchase, and a statement that such Holder is
withdrawing his election to have the Notes purchased; and

 

(7)           that Holders
whose Notes are being purchased only in part will be issued new Notes equal in
principal amount to the unpurchased portion of the Notes surrendered, which
unpurchased portion must be equal to $2,000 in principal amount or an integral
multiple of $1,000 in excess thereof.

 

The Issuers will comply with the requirements of Rule 14e-1
under the Exchange Act and any other securities laws and regulations thereunder
to the extent those laws and regulations are applicable in connection with the
repurchase of the Notes as a result of a Change in Control.  To the extent that the provisions of any
securities laws or regulations conflict with the provisions of Sections 3.09 or
4.14 of this Indenture, the Issuers will comply with the applicable securities
laws and regulations and will not be deemed to have breached their obligations
under Section 3.09 or this Section 4.14 by virtue of such conflict.

 

(b)           On the Change of Control Payment Date, the Issuers
will, to the extent lawful:

 

(1)           accept for
payment all Notes or portions thereof properly tendered in accordance with the
Change of Control Offer;

 

(2)           deposit an
amount equal to the Change of Control Payment for the Notes with the Paying
Agent in respect of all Notes or portions of Notes properly tendered; and

 

(3)           deliver or
cause to be delivered to the Trustee the Notes so accepted together with an
Officers’ Certificate stating the aggregate principal amount of Notes or
portions of Notes being tendered to the Issuers.

 

61

 

The Paying Agent will promptly mail to each Holder
of Notes properly tendered the Change of Control Payment for such Notes, and
the Trustee will promptly authenticate and mail (or cause to be transferred by
book entry) to each Holder a new Note equal in principal amount to any
unpurchased portion of the Notes surrendered, if any; provided that each new Note will be in a
principal amount of $2,000 or an integral multiple of $2,000 in excess
thereof.  The Issuers will publicly
announce the results of the Change of Control Offer on or as soon as
practicable after the Change of Control Payment Date.

 

(c)           Notwithstanding anything to the contrary in this Section 4.14,
the Issuers will not be required to make a Change of Control Offer upon a
Change of Control if a third party makes the Change of Control Offer in the
manner, at the times and otherwise in compliance with the requirements set
forth in this Section 4.14 and Section 3.09 hereof and purchases all
Notes properly tendered and not withdrawn under the Change of Control Offer.

 

Section 4.15           Limitation
on Finance Corp.

 

In
addition to the restrictions set forth under Section 4.09 hereof, Finance
Corp. will not incur any Indebtedness unless:

 

(1)           the Partnership
is a co-obligor or guarantor of the Indebtedness; or

 

(2)           the net
proceeds of the Indebtedness are either lent to the Partnership, used to
acquire outstanding debt securities issued by the Partnership, or used,
directly or indirectly, to refinance or discharge Indebtedness permitted under
the limitation of this Section 4.15.

 

Finance Corp. will not engage in any business not
related, directly or indirectly, to obtaining money or arranging financing for
the Partnership.

 

ARTICLE 5.

SUCCESSORS

 

Section 5.01           Merger,
Consolidation, or Sale of Assets.

 

The Partnership shall not consolidate or merge with
or into, or sell, assign, transfer, lease, convey or otherwise dispose of all
or substantially all of its properties or assets, in one or more related
transactions, to another entity unless:

 

(1)           the Partnership
is the surviving entity or the entity formed by or surviving the transaction,
if other than the Partnership, or the entity to which the sale was made is a
corporation or partnership organized or existing under the laws of the United
States, any state thereof or the District of Columbia;

 

(2)           the entity
formed by or surviving the transaction, if other than the Partnership, or the
entity to which the sale was made assumes all the obligations of the
Partnership in accordance with a supplemental indenture in a form reasonably
satisfactory to the Trustee, under the Notes and this Indenture;

 

62

 

(3)           immediately
after the transaction, no Default or Event of Default exists; and

 

(4)           at the time of
the transaction and after giving pro forma effect to it as if the transaction
had occurred at the beginning of the applicable four-quarter period, either (a) the
Partnership or such other entity or survivor is permitted to incur at least
$1.00 of additional Indebtedness in accordance with the Consolidated Fixed
Charge Coverage Ratio described in Section 4.09(a) hereof, or (b) the
Consolidated Fixed Charge Coverage Ratio of the Partnership or such other
entity or survivor is equal to or greater than the Consolidated Fixed Charge
Coverage Ratio of the Partnership immediately before such transaction.

 

This Section 5.01 will not apply to a sale,
assignment, transfer, conveyance or other disposition of assets between or
among the Partnership and any of its Restricted Subsidiaries.  Finance Corp. will not consolidate or merge
with or into, whether or not it is the surviving entity, or sell, assign,
transfer, lease, convey or otherwise dispose of all or substantially all of its
properties or assets in one or more related transactions to, another entity
except under conditions similar to those described in the paragraph above.

 

Section 5.02           Successor
Corporation Substituted.

 

Upon any consolidation or merger, or any sale,
assignment, transfer, lease, conveyance or other disposition of all or
substantially all of the assets of the Partnership or Finance Corp. in a
transaction that is subject to, and that complies with the provisions of, Section 5.01
hereof, the successor corporation formed by such consolidation or into or with
which the Partnership or Finance Corp., as applicable, is merged or to which
such sale, assignment, transfer, lease, conveyance or other disposition is made
shall succeed to, and be substituted for (so that from and after the date of
such consolidation, merger, sale, lease, conveyance or other disposition, the
provisions of this Indenture referring to the “Partnership” or “Finance Corp.,”
as applicable, shall refer instead to the successor corporation and not to
Partnership or Finance Corp., as applicable), and may exercise every right and
power of the Partnership or Finance Corp., as applicable, under this Indenture
with the same effect as if such successor Person had been named as the
Partnership or Finance Corp., as applicable, herein; provided, however, that Partnership or Finance Corp., as
applicable, shall not be relieved from the obligation to pay the principal of
and interest on the Notes except in the case of a sale of all of assets of the
Partnership or Finance Corp., as applicable, in a transaction that is subject
to, and that complies with the provisions of, Section 5.01 hereof.

 

ARTICLE 6.

DEFAULTS AND REMEDIES

 

Section 6.01           Events
of Default.

 

Each of the following is an
“Event of Default”:

 

(1)           default in the
payment of the principal of or premium, if any, on any Note when the same
becomes due and payable, upon stated maturity, acceleration, optional
redemption, required purchase, scheduled principal payment or otherwise;

 

63

 

(2)           default in the
payment of an installment of interest on any of the Notes, when the same
becomes due and payable, which default continues for a period of 30 days;

 

(3)           failure to
perform or observe any other term, covenant or agreement contained in the Notes
or this Indenture, other than a default specified in either Section 6.01(1) or
(2) above, and the default continues for a period of 45 days after written
notice of the default requiring the Issuers to remedy the same will have been
given to the Partnership by the Trustee or to the Issuers and the Trustee by
Holders of at least 25% in aggregate principal amount of the Notes then
outstanding;

 

(4)           default or
defaults under one or more agreements, instruments, mortgages, bonds,
debentures or other evidences of Indebtedness under which the Partnership or
any Restricted Subsidiary of the Partnership then has outstanding Indebtedness
in excess of $25 million, if the default:

 

(a)  is caused by a failure to pay principal of or premium, if
any, or interest on to such Indebtedness within the applicable grace period, if
any, provided with respect to such Indebtedness; or

 

(b)  results in the acceleration of such Indebtedness prior to its
stated maturity;

 

(5)           a final
judgment or judgments, which is or are non-appealable and non-reviewable or
which has or have not been stayed pending appeal or review or as to which all
rights to appeal or review have expired or been exhausted, shall be rendered
against the Partnership, any Restricted Subsidiary, or the General Partner
provided such judgment or judgments requires or require the payment of money in
excess of $25 million in the aggregate and is not covered by insurance or
discharged or stayed pending appeal or review within 60 days after entry of
such judgment; in the event of a stay, the judgment shall not be discharged
within 30 days after the stay expires;

 

(6)           the Issuers or
any of their Significant Subsidiaries pursuant to or within the meaning of
Bankruptcy Law:

 

(A) commences a voluntary case,

 

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

 

(C) consents to the appointment of a custodian of it or for all or
substantially all of its property,

 

(D) makes a general assignment for the benefit of its creditors,
or

 

(E) generally is not paying its debts as they become due; or

 

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

 

64

 

(A) is for relief against the Issuers or any of their Significant
Subsidiaries in an involuntary case;

 

(B) appoints a custodian of the Issuers or any of their
Significant Subsidiaries or for all or substantially all of the property of the
Issuers or any of their Significant Subsidiaries; or

 

(C) orders the liquidation of the Issuers or any of their
Significant Subsidiaries;

 

and
the order or decree remains unstayed and in effect for 60 consecutive days.

 

Section 6.02           Acceleration.

 

In the case of an Event of Default specified in
clause (6) or (7) of Section 6.01 hereof, with respect to the
Partnership, Finance Corp. or any Significant Subsidiary, all outstanding Notes
will become due and payable immediately without further action or notice.  If any other Event of Default occurs and is
continuing, the Trustee or the Holders of at least 25% in principal amount of
the applicable series of Notes then outstanding may declare all the Notes of
that series to be due and payable immediately.

 

Upon any such declaration, the Notes shall become
due and payable immediately.  The Holders
of a majority in aggregate principal amount of a series of Notes issued under
this Indenture and then outstanding by notice to the Trustee may on behalf of
all of the Holders of that series rescind an acceleration and its consequences
if the rescission would not conflict with any judgment or decree and if all
existing Events of Default (except nonpayment of principal, interest or premium
that has become due solely because of the acceleration) have been cured or
waived.

 

If
an Event of Default by reason of any action (or inaction) taken (or not taken)
by or on behalf of the Issuers with the willful intention of avoiding payment
of the premium that the Issuers would have had to pay if the Issuers then had
elected to redeem the Notes pursuant to Section 3.07 hereof, then, upon
acceleration of the Notes, an equivalent premium shall also become and be
immediately due and payable, to the extent permitted by law, anything in this
Indenture or in the Notes to the contrary notwithstanding.

 

Section 6.03           Other
Remedies.

 

If an Event of Default occurs and is continuing, the
Trustee may pursue any available remedy to collect the payment of principal,
premium, if any, and interest on the Notes or to enforce the performance of any
provision of the Notes or this Indenture.

 

The Trustee may maintain a proceeding even if it
does not possess any of the Notes or does not produce any of them in the
proceeding.  A delay or omission by the
Trustee or any Holder of a Note in exercising any right or remedy accruing upon
an Event of Default shall not impair the right or remedy or constitute a waiver
of or acquiescence in the Event of Default. 
All remedies are cumulative to the extent permitted by law.

 

65

 

 

Section 6.04           Waiver
of Past Defaults.

 

Holders of not less than a majority in aggregate
principal amount of a series of Notes issued under this Indenture and then
outstanding by notice to the Trustee for those Notes may on behalf of the
Holders of the Notes of that series waive any existing Default or Event of
Default and its consequences hereunder, except a continuing Default or Event of
Default in the payment of the principal of, premium, if any, or interest on,
the Notes; provided, however,
that the Holders of a majority in aggregate principal amount of the then
outstanding Notes may rescind an acceleration and its consequences, including
any related payment default that resulted from such acceleration.  Upon any such waiver, such Default shall
cease to exist, and any Event of Default arising therefrom shall be deemed to
have been cured for every purpose of this Indenture; but no such waiver shall
extend to any subsequent or other Default or impair any right consequent
thereon.

 

Section 6.05           Control
by Majority.

 

Holders of a majority in principal amount of the
then outstanding Notes may direct the time, method and place of conducting any
proceeding for exercising any remedy available to the Trustee of that series of
Notes or exercising any trust or power conferred on it.  However, the Trustee may refuse to follow any
direction that conflicts with law or this Indenture that the Trustee determines
may be unduly prejudicial to the rights of other Holders of Notes or that may
subject the Trustee to personal liability.

 

Section 6.06           Limitation on Suits.

 

A Holder of a Note may pursue a remedy with respect
to this Indenture or the Notes only if:

 

(1)           the Holder of a
Note gives to the Trustee written notice of a continuing Event of Default;

 

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

 

(3)           such Holder of
a Note or Holders of Notes offer and, if requested, provide to the Trustee
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 the request
and the offer and, if requested, the provision of indemnity; and

 

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

 

A Holder of a Note may not use this Indenture to
prejudice the rights of another Holder of a Note or to obtain a preference or
priority over another Holder of a Note (it being understood that the Trustee
does not have an affirmative duty to ascertain whether or not such actions or
forbearances are unduly prejudicial to such Holders).

 

66

 

Section 6.07           Rights
of Holders of Notes to Receive Payment.

 

Notwithstanding any other provision of this
Indenture, the right of any Holder of a Note to receive payment of principal,
premium, if any, and interest on the Note, on or after the respective due dates
expressed in the Note (including in connection with an offer to purchase), or
to bring suit for the enforcement of any such payment on or after such
respective dates, shall not be impaired or affected without the consent of such
Holder.

 

Section 6.08           Collection Suit by Trustee.

 

If an Event of Default specified in Section 6.01(1) or
(2) occurs and is continuing, the Trustee is authorized to recover
judgment in its own name and as trustee of an express trust against the Issuers
for the whole amount of principal of, premium, if any, and interest remaining
unpaid on the Notes and interest on overdue principal and, to the extent
lawful, interest and such further amount as shall be sufficient to cover the
costs and expenses of collection, including the reasonable compensation,
expenses, disbursements and advances of the Trustee, its agents and counsel.

 

Section 6.09           Trustee May File Proofs of
Claim.

 

The Trustee is authorized to file such proofs of
claim and other papers or documents as may be necessary or advisable in order
to have the claims of the Trustee (including any claim for the reasonable
compensation, expenses, disbursements and advances of the Trustee, its agents
and counsel) and the Holders of the Notes allowed in any judicial proceedings
relative to the Issuers (or any other obligor upon the Notes), their creditors
or their property and shall be entitled and empowered to collect, receive and
distribute any money or other property payable or deliverable on any such
claims and any custodian in any such judicial proceeding is hereby authorized
by each Holder to make such payments to the Trustee, and in the event that the
Trustee shall consent to the making of such payments directly to the Holders,
to pay to the Trustee any amount due to it for the reasonable compensation,
expenses, disbursements and advances of the Trustee, its agents and counsel,
and any other amounts due the Trustee under Section 7.07 hereof.  To the extent that the payment of any such
compensation, expenses, disbursements and advances of the Trustee, its agents
and counsel, and any other amounts due the Trustee under Section 7.07
hereof out of the estate in any such proceeding, shall be denied for any
reason, payment of the same shall be secured by a Lien on, and shall be paid
out of, any and all distributions, dividends, money, securities and other
properties that the Holders may be entitled to receive in such proceeding
whether in liquidation or under any plan of reorganization or arrangement or
otherwise.  Nothing herein contained shall
be deemed to authorize the Trustee to authorize or consent to or accept or
adopt on behalf of any Holder any plan of reorganization, arrangement,
adjustment or composition affecting the Notes or the rights of any Holder, or
to authorize the Trustee to vote in respect of the claim of any Holder in any
such proceeding.

 

Section 6.10           Priorities.

 

If the Trustee collects any money pursuant to this Article 6,
it shall pay out the money in the following order:

 

67

 

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

 

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

 

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

 

The Trustee may fix a record date and payment date
for any payment to Holders of Notes pursuant to this Section 6.10.

 

Section 6.11           Undertaking
for Costs.

 

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

 

ARTICLE 7.

TRUSTEE

 

Section 7.01           Duties
of Trustee.

 

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

 

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

 

(1)           the duties of
the Trustee will be determined solely by the express provisions of this
Indenture and the Trustee need perform only those duties that are specifically
set forth in this Indenture and no others, and no implied covenants or
obligations shall be read into this Indenture against the Trustee; and

 

(2)           in the absence
of bad faith on its part, the Trustee may conclusively rely, as to the truth of
the statements and the correctness of the opinions expressed therein, upon
certificates or opinions furnished to the Trustee and conforming to the requirements
of this Indenture.  However, 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 will 

 

68

 

examine
the certificates and opinions to determine whether or not they conform to the
requirements of this Indenture.

 

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

 

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

 

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

 

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

 

(d)           Whether or not therein expressly so provided, every
provision of this Indenture that in any way relates to the Trustee is subject
to paragraphs (a), (b), and (c) of this Section 7.01.

 

(e)           No provision of this Indenture will require the
Trustee to expend or risk its own funds or incur any liability.  The Trustee will be under no obligation to
exercise any of its rights and powers under this Indenture at the request of
any Holders, unless such Holder has offered to the Trustee security and indemnity
satisfactory to it against any loss, liability or expense.

 

(f)            The Trustee will not be liable for interest on any
money received by it except as the Trustee may agree in writing with the
Issuers.  Money held in trust by the
Trustee need not be segregated from other funds except to the extent required
by law.

 

Section 7.02           Rights of Trustee.

 

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

 

(b)           Before the Trustee acts or refrains from acting, it
may require an Officers’ Certificate or an Opinion of Counsel or both.  The Trustee will not be liable for any action
it takes or omits to take in good faith in reliance on such Officers’
Certificate or Opinion of Counsel.  The
Trustee may consult with counsel and the written opinion or advice of such
counsel or any Opinion of Counsel will be full and complete authorization and
protection from liability in respect of any action taken, suffered or omitted
by it hereunder in good faith and in reliance thereon.

 

(c)           The Trustee 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 

 

69

 

such facts or matters as it may see fit and shall
incur no liability or additional liability of any kind by reason of such
inquiry or investigation.

 

(d)           Except with respect to Section 4.01 hereof, the
Trustee shall have no duty to inquire as to the performance of the Issuers’
covenants in Article 4 hereof.  In
addition, the Trustee shall not be deemed to have knowledge of any Default or
Event of Default except (i) any Event of Default occurring pursuant to
Sections 6.01(1), 6.01(2) and 4.01 hereof or (ii) any Default or
Event of Default of which the Trustee shall have received written notification
in the manner set forth in this Indenture or an Officer in the Corporate Trust
Office of the Trustee shall have obtained actual knowledge.  Delivery of reports, information and
documents to the Trustee under Section 4.03 is for informational purposes
only and the Trustee’s receipt of the foregoing shall not constitute
constructive notice of any information contained therein or determinable from
information contained therein, including the Issuers’ compliance with any of
their covenants thereunder (as to which the Trustee is entitled to rely
exclusively on an Officers’ Certificate.)

 

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

 

(f)            The Trustee will not be liable for any action it
takes or omits to take in good faith that it believes to be authorized or
within the rights or powers conferred upon it by this Indenture.

 

(g)           Unless otherwise specifically provided in this
Indenture, any demand, request, direction or notice from the Issuers will be
sufficient if signed by an Officer of the Issuers.

 

(h)           The Trustee will be under no obligation to exercise
any of the rights or powers vested in it by this Indenture at the request or
direction of any of the Holders unless such Holders have offered to the Trustee
reasonable security or indemnity against the costs, expenses and liabilities
that might be incurred by it in compliance with such request or direction.

 

(i)            In no event shall the Trustee be responsible or
liable for special, indirect, punitive or consequential loss or damage of any
kind whatsoever (including, but not limited to, loss of profit) irrespective of
whether the Trustee has been advised of the likelihood of such loss or damage
and regardless of the form of action.

 

(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 each agent, custodian and other Person
employed to act hereunder.

 

(k)           The Trustee shall not be required to give any bond
or surety in respect of the performance of its powers and duties hereunder.

 

(l)            The Trustee may request that the Issuers deliver a
certificate setting forth the names of individuals and/or titles of officers
authorized at such time to take specified actions pursuant to this Indenture.

 

70

 

Section 7.03           Individual
Rights of Trustee.

 

The Trustee in its individual or any other capacity
may become the owner or pledgee of Notes and may otherwise deal with the
Issuers or any Affiliate of the Issuers with the same rights it would have if
it were not Trustee.  However, in the
event that the Trustee acquires any conflicting interest it must eliminate such
conflict within 90 days, apply to the SEC for permission to continue as trustee
or resign.  Any Agent may do the same
with like rights and duties.  The Trustee
is also subject to Sections 7.10 and 7.11 hereof.

 

Section 7.04           Trustee’s Disclaimer.

 

The Trustee will not be responsible for and makes no
representation as to the validity or adequacy of this Indenture or the Notes,
it shall not be accountable for the Issuers’ use of the proceeds from the Notes
or any money paid to the Issuers or upon the Issuers’ direction under any
provision of this Indenture, it will not be responsible for the use or
application of any money received by any Paying Agent other than the Trustee,
and it will not be responsible for any statement or recital herein or any
statement in the Notes or any other document in connection with the sale of the
Notes or pursuant to this Indenture other than its certificate of
authentication.

 

Section 7.05           Notice of Defaults.

 

If a Default or Event of Default occurs and is
continuing and if it is known to the Trustee, the Trustee will mail to Holders
of Notes a notice of the Default or Event of Default within 90 days after it
occurs.  Except in the case of a Default
or Event of Default in payment of principal of, premium, if any, or interest on
any Note, the Trustee may withhold the notice if the Trustee determines in good
faith determines that withholding the notice is in the interests of the Holders
of the Notes.

 

Section 7.06           Reports by Trustee to Holders of
the Notes.

 

(a)           Within 60 days after each May 15 beginning with
the May 15 following the date of this Indenture, and for so long as Notes
remain outstanding, the Trustee will mail to the Holders of the Notes a brief
report dated as of such reporting date that complies with TIA § 313(a) (but
if no event described in TIA § 313(a) has occurred within the twelve
months preceding the reporting date, no report need be transmitted).  The Trustee also will comply with TIA
§ 313(b)(2).  The Trustee will also
transmit by mail all reports as required by TIA § 313(c).

 

(b)           A copy of each report at the time of its mailing to
the Holders of Notes will be mailed by the Trustee to the Issuers and filed by
the Trustee with the SEC and each stock exchange on which the Notes are listed
in accordance with TIA § 313(d). 
The Issuers will promptly notify the Trustee in writing when the Notes
are listed on any stock exchange and of any delisting thereof.

 

Section 7.07           Compensation and Indemnity.

 

(a)           The Issuers will pay to the Trustee from time to
time such compensation as shall be agreed in writing between the Trustee and
the Issuers for its acceptance of this Indenture and services hereunder.  The Trustee’s compensation will not be
limited by any law on compensation 

 

71

 

of a trustee of an express trust.  The Issuers will reimburse the Trustee
promptly upon request for all reasonable disbursements, advances and expenses
incurred or made by it in addition to the compensation for its services. Such
expenses will include the reasonable compensation, disbursements and expenses
of the Trustee’s agents and counsel.

 

(b)           The Issuers will indemnify the Trustee against any
and all losses, liabilities or expenses incurred by it arising out of or in
connection with the acceptance or administration of its duties under this
Indenture, including the costs and expenses of enforcing this Indenture against
the Issuers (including this Section 7.07) and defending itself against any
claim (whether asserted by the Issuers or any Holder or any other Person) or
liability in connection with the exercise or performance of any of its powers
or duties hereunder, except to the extent any such loss, liability or expense
may be attributable to its negligence or bad faith.  The Trustee will notify the Issuers promptly
of any claim for which it may seek indemnity. 
Failure by the Trustee to so notify the Issuers will not relieve the
Issuers of their obligations hereunder. 
The Issuers will defend the claim and the Trustee will cooperate in the
defense.  The Trustee may have separate
counsel and the Issuers will pay the reasonable fees and expenses of such
counsel.  The Issuers need not pay for
any settlement made without its consent, which consent will not be unreasonably
withheld.

 

(c)           The obligations of the Issuers under this Section 7.07
will survive the satisfaction and discharge of this Indenture.

 

(d)           To secure the Issuers’ payment obligations in this Section 7.07,
the Trustee will have a claim prior to the Notes on all money or property held
or collected by the Trustee, except that held in trust to pay principal and
interest on particular Notes.  Such claim
will survive the satisfaction and discharge of this Indenture.

 

(e)           When the Trustee incurs expenses or renders services
after an Event of Default specified in Section 6.01(6) or 6.01(7) hereof
occurs, the expenses and the compensation for the services (including the fees
and expenses of its agents and counsel) are intended to constitute expenses of
administration under any Bankruptcy Law.

 

(f)            The Trustee will comply with the provisions of TIA
§ 313(b)(2) to the extent applicable.

 

Section 7.08           Replacement of Trustee.

 

(a)           A resignation or removal of the Trustee and
appointment of a successor Trustee will become effective only upon the
successor Trustee’s acceptance of appointment as provided in this Section 7.08.

 

(b)           The Trustee may resign in writing at any time and be
discharged from the trust hereby created by so notifying the Issuers.  The Holders of a majority in principal amount
of the then outstanding Notes may remove the Trustee by so notifying the
Trustee and the Issuers in writing.  The
Issuers may remove the Trustee if:

 

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

 

72

 

(2)           the Trustee is
adjudged a bankrupt or an insolvent or an order for relief is entered with
respect to the Trustee under any Bankruptcy Law;

 

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

 

(4)           the Trustee
becomes incapable of acting.

 

(c)           If the Trustee resigns or is removed or if a vacancy
exists in the office of Trustee for any reason, the Issuers will promptly
appoint a successor Trustee.  Within one
year after the successor Trustee takes office, the Holders of a majority in
principal amount of the then outstanding Notes may appoint a successor Trustee
to replace the successor Trustee appointed by the Issuers.

 

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

 

(e)           If the Trustee, after written request by any Holder
who has been a Holder for at least six months, fails to comply with Section 7.10,
such Holder may petition any court of competent jurisdiction for the removal of
the Trustee and the appointment of a successor Trustee.

 

(f)            A successor Trustee will deliver a written
acceptance of its appointment to the retiring Trustee and to the Issuers.  Thereupon, the resignation or removal of the
retiring Trustee will become effective, and the successor Trustee will have all
the rights, powers and duties of the Trustee under this Indenture.  The successor Trustee will mail a notice of
its succession to Holders.  The retiring
Trustee will promptly transfer all property held by it as Trustee to the
successor Trustee, provided all
sums owing to the Trustee hereunder have been paid and subject to the claim
provided for in Section 7.07 hereof. 
Notwithstanding replacement of the Trustee pursuant to this Section 7.08,
the Issuers’ obligations under Section 7.07 hereof will continue for the
benefit of the retiring Trustee.

 

Section 7.09           Successor Trustee by Merger, etc.

 

If the Trustee consolidates, merges or converts
into, or transfers all or substantially all of its corporate trust business to,
another corporation, the successor corporation without any further act will be
the successor Trustee.

 

Section 7.10           Eligibility; Disqualification.

 

There will at all times be a Trustee hereunder that
is a corporation organized and doing business under the laws of the United
States of America or of any state thereof that is authorized under such laws to
exercise corporate trustee power, that is subject to supervision or examination
by federal or state authorities and that has a combined capital and surplus of
at least $50 million as set forth in its most recent published annual report of
condition.

 

This Indenture will always have a Trustee who
satisfies the requirements of TIA § 310(a)(1), (2) and (5).  The Trustee is subject to TIA § 310(b).

 

73

 

Section 7.11           Preferential Collection of Claims
Against the Issuers.

 

The Trustee is subject to TIA § 311(a),
excluding any creditor relationship listed in TIA § 311(b).  A Trustee who has resigned or been removed
shall be subject to TIA § 311(a) to the extent indicated therein.

 

ARTICLE 8.

LEGAL DEFEASANCE AND
COVENANT DEFEASANCE

 

Section 8.01           Option to Effect Legal Defeasance
or Covenant Defeasance.

 

The Issuers may, at the option of the Board of
Directors of the General Partner, on the Issuers’ behalf, and the Board of
Directors of Finance Corp., and at any time, elect to have Section 8.02
hereof be applied to all outstanding Notes upon compliance with the conditions
set forth below in this Article 8. 
The Issuers may, at their option and at any time, elect to have Section 8.03
hereof be applied to all outstanding Notes upon compliance with the conditions
set forth below in this Article 8.

 

Section 8.02           Legal Defeasance and Discharge.

 

Upon the Issuers’ exercise under Section 8.01
hereof of the option applicable to this Section 8.02, the Issuers will,
subject to the satisfaction of the conditions set forth in Section 8.04
hereof, be deemed to have been discharged from their obligations with respect
to all outstanding Notes on the date the conditions set forth below are
satisfied (hereinafter, “Legal Defeasance”).  For this purpose, Legal Defeasance means that
the Issuers will be deemed to have paid and discharged the entire Indebtedness
represented by the outstanding Notes, which will thereafter be deemed to be
“outstanding” only for the purposes of Section 8.05 hereof and the other
Sections of this Indenture referred to in clauses (1) and (2) below,
and to have satisfied all their other obligations under such Notes and this
Indenture (and the Trustee, on demand of and at the expense of the Issuers,
shall execute proper instruments acknowledging the same), except for the
following provisions which will survive until otherwise terminated or
discharged hereunder:

 

(1)           the rights of
Holders of outstanding Notes to receive payments in respect of the principal
of, or interest or premium, if any, on such Notes when such payments are due
from the trust referred to in Section 8.04 hereof;

 

(2)           the Issuers’
obligations with respect to the Notes concerning issuing temporary Notes,
registration of Notes or mutilated, destroyed, lost or stolen Notes under Article 2;

 

(3)           the Issuers’
obligation to maintain an office or agency for payment under Section 4.02
hereof and money for security payments held in trust;

 

(4)           the rights,
powers, trusts, duties and immunities of the Trustee hereunder and the Issuers’
obligations in connection therewith; and

 

(5)           the legal
defeasance and covenant defeasance provisions of this Article 8.

 

74

 

Subject to compliance with this Article 8, the
Issuers may exercise their option under this Section 8.02 notwithstanding
the prior exercise of their option under Section 8.03 hereof.

 

Section 8.03           Covenant
Defeasance.

 

Upon the Issuers’ exercise under Section 8.01
hereof of the option applicable to this Section 8.03, the Issuers will,
subject to the satisfaction of the conditions set forth in Section 8.04
hereof, be released from each of their obligations under the covenants
contained in Sections 4.07, 4.08, 4.09, 4.10, 4.11, 4.12, 4.14 and 4.15 hereof
and clause (4) of Section 5.01 hereof with respect to the outstanding
Notes on and after the date the conditions set forth in Section 8.04
hereof are satisfied (hereinafter, “Covenant
Defeasance”), and the Notes will thereafter be deemed not
“outstanding” for the purposes of any direction, waiver, consent or declaration
or act of Holders (and the consequences of any thereof) in connection with such
covenants, but will continue to be deemed “outstanding” for all other purposes
hereunder (it being understood that such Notes will not be deemed outstanding
for accounting purposes).  For this
purpose, Covenant Defeasance means that, with respect to the outstanding Notes,
the Issuers may omit to comply with and will have no liability in respect of
any term, condition or limitation set forth in any such covenant, whether
directly or indirectly, by reason of any reference elsewhere herein to any such
covenant or by reason of any reference in any such covenant to any other
provision herein or in any other document and such omission to comply will not
constitute a Default or an Event of Default under Section 6.01 hereof,
but, except as specified above, the remainder of this Indenture and such Notes
will be unaffected thereby.  In addition,
upon the Issuers’ exercise under Section 8.01 hereof of the option
applicable to this Section 8.03 hereof, subject to the satisfaction of the
conditions set forth in Section 8.04 hereof, Section 6.01(3) hereof
will not constitute an Event of Default.

 

Section 8.04           Conditions to Legal or Covenant
Defeasance.

 

In order to exercise either Legal Defeasance or
Covenant Defeasance under either Section 8.02 or 8.03 hereof:

 

(1)           the Issuers
must irrevocably deposit with the Trustee, in trust, for the benefit of the
Holders, cash in United States dollars, non-callable Government Securities, or
a combination thereof, in such amounts as will be sufficient, in the opinion of
a nationally recognized firm of independent public accountants, to pay the
principal of, premium, if any, and interest on the outstanding Notes on the
stated maturity date for payment thereof or on the applicable redemption date,
as the case may be;

 

(2)           the Issuers
will deliver to the Trustee an Opinion of Counsel stating that:

 

(a)  after the 91st day following
the deposit the trust funds will not be subject to the effect of any applicable
bankruptcy, insolvency, reorganization or similar laws affecting creditors’
rights generally, and all conditions precedent provided for or relating to the
Legal Defeasance or the Covenant Defeasance have been complied with and
confirming other matters;

 

(b)  in the case of an election under Section 8.02 hereof,
that the Issuers have received from, or there has been published by, the
Internal Revenue Service a

 

75

 

 

ruling, or since the date of
this Indenture, there shall have been a change in the applicable federal income
tax law, in either case to the effect that, and based thereon, the Holders of
the outstanding Notes will not recognize income, gain or loss for federal
income tax purposes as a result of such Legal Defeasance and will be subject to
federal income tax on the same amounts, in the same manner and at the same
times as would have been the case if such Legal Defeasance had not occurred;
and

 

(c) 
in the case of an election under Section 8.03 hereof, that the Holders of
the outstanding Notes will not recognize income, gain or loss for federal
income tax purposes as a result of such Covenant Defeasance and will be subject
to federal income tax on the same amounts, in the same manner and at the same
times as would have been the case if such Covenant Defeasance had not occurred;

 

(3)                                  the Issuers
must deliver to the Trustee an Officers’ Certificate stating that the deposit
was not made by the Issuers with the intent of preferring the Holders of Notes
over the other creditors of the Issuers or with the intent of defeating,
hindering, delaying or defrauding any other creditors of the Issuers;

 

(4)                                  no Event of
Default shall have occurred and be continuing on the date of such deposit or
insofar as Events of Default described in Section 6.01(6) or 6.01(7) hereof
are concerned, at any time in the period ending on the 91st day after the date of deposit; and

 

(5)                                  such Legal
Defeasance or Covenant Defeasance will not result in a breach, violation of, or
constitute a default under, any material agreement or instrument (other than
this Indenture) to which the Issuers or any of their Restricted Subsidiaries is
a party or by which the Issuers or any of their Restricted Subsidiaries is
bound.

 

Section 8.05                                Deposited Money
and Government Securities to be Held in Trust; Other Miscellaneous Provisions.

 

Subject to Section 8.06
hereof, all money and non-callable Government Securities (including the
proceeds thereof) deposited with the Trustee (or other qualifying trustee,
collectively for purposes of this Section 8.05, the “Trustee”) pursuant to
Section 8.04 hereof in respect of the outstanding Notes will be held in
trust and applied by the Trustee, in accordance with the provisions of such
Notes and this Indenture, to the payment, either directly or through any Paying
Agent (including the Issuers or any of their Restricted Subsidiaries acting as
Paying Agent) as the Trustee may determine, to the Holders of such Notes of all
sums due and to become due thereon in respect of principal, premium, if any,
and interest, but such money need not be segregated from other funds except to
the extent required by law.

 

The Issuers will pay and
indemnify the Trustee against any tax, fee or other charge imposed on or
assessed against the cash or non-callable Government Securities deposited
pursuant to Section 8.04 hereof or the principal and interest received in
respect thereof other than any such tax, fee or other charge which by law is
for the account of the Holders of the outstanding Notes.

 

76

 

Notwithstanding anything in
this Article 8 to the contrary, the Trustee will deliver or pay to the
Issuers from time to time upon the written request of the Issuers any money or
non-callable Government Securities held by it as provided in Section 8.04
hereof which, in the opinion of a nationally recognized firm of independent
public accountants expressed in a written certification thereof delivered to
the Trustee (which may be the opinion delivered under Section 8.04(1) hereof),
are in excess of the amount thereof that would then be required to be deposited
to effect an equivalent Legal Defeasance or Covenant Defeasance.

 

Section 8.06                                Repayment to
the Issuers.

 

Any money deposited with the
Trustee or any Paying Agent, or then held by the Issuers, in trust for the
payment of the principal of, premium, if any, or interest on any Note and
remaining unclaimed for two years after such principal, premium, if any, or interest
has become due and payable shall be paid to the Issuers on their request or (if
then held by the Issuers) will be discharged from such trust; and the Holder of
such Note will thereafter be permitted to look only to the Issuers for payment
thereof, and all liability of the Trustee or such Paying Agent with respect to
such trust money, and all liability of the Issuers as trustee thereof, will
thereupon cease; provided, however,
that the Trustee or such Paying Agent, before being required to make any such
repayment, shall at the expense of the Issuers cause to be published once, in
the New York Times and The Wall Street Journal (national edition), notice that
such money remains unclaimed and that, after a date specified therein, which
will not be less than 30 days from the date of such notification or
publication, any unclaimed balance of such money then remaining will be repaid
to the Issuers.

 

Section 8.07                                Reinstatement.

 

If the Trustee or Paying
Agent is unable to apply any United States dollars or non-callable Government
Securities in accordance with Section 8.02 or 8.03 hereof, as the case may
be, by reason of any order or judgment of any court or governmental authority
enjoining, restraining or otherwise prohibiting such application, then the
Issuers’ obligations under this Indenture and the Notes will be revived and
reinstated as though no deposit had occurred pursuant to Section 8.02 or
8.03 hereof until such time as the Trustee or Paying Agent is permitted to
apply all such money in accordance with Section 8.02 or 8.03 hereof, as
the case may be; provided, however,
that, if the Issuers make any payment of principal of, premium, if any, or
interest on any Note following the reinstatement of its obligations, the
Issuers will be subrogated to the rights of the Holders of such Notes to
receive such payment from the money held by the Trustee or Paying Agent.

 

ARTICLE 9.

AMENDMENT, SUPPLEMENT AND WAIVER

 

Section 9.01                                Without Consent
of Holders of Notes.

 

Notwithstanding Section 9.02
of this Indenture, the Issuers and the Trustee may amend or supplement this
Indenture or the Notes without the consent of any Holder of a Note to:

 

(1)                                  cure any
ambiguity, defect or inconsistency;

 

77

 

(2)                                  provide for
uncertificated Notes in addition to or in place of certificated Notes;

 

(3)                                  provide for the
assumption of the Issuers’ obligations to Holders of Notes in the case of a
merger or consolidation;

 

(4)                                  make any change
that could provide any additional rights or benefits to the Holders of Notes
that does not adversely affect the legal rights under this Indenture of any
such Holder;

 

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

 

(6)                                  to provide security
for or add guarantees with respect to the Notes.

 

Upon the request of the
Partnership accompanied by a resolution of its Board of Directors authorizing
the execution of any such amended or supplemental Indenture, and upon receipt
by the Trustee of the documents described in Section 9.06 hereof, the
Trustee will join with the Issuers in the execution of any amended or
supplemental Indenture authorized or permitted by the terms of this Indenture
and to make any further appropriate agreements and stipulations that may be
therein contained, but the Trustee will not be obligated to enter into such
amended or supplemental Indenture that affects its own rights, duties or
immunities under this Indenture or otherwise.

 

Section 9.02                                With Consent of
Holders of Notes.

 

Except as provided below in
this Section 9.02, the Issuers and the Trustee may amend or supplement
this Indenture (including, without limitation, Sections 3.09, 4.10 and 4.14
hereof) and the Notes with the consent of the Holders of at least a majority in
principal amount of the Notes then outstanding (including, without limitation,
consents obtained in connection with a tender offer or exchange offer for the
Notes), and, subject to Sections 6.04 and 6.07 hereof, any existing Default or
Event of Default (other than a continuing Default or Event of Default in the
payment of the principal of, premium, if any, or interest on the Notes, except
a payment default resulting from an acceleration that has been rescinded) may
be waived for all Holders of Notes of a series and its consequences under this
Indenture with the consent of the Holders of a majority in aggregate principal
amount of that series of Notes (including Additional Notes, if any) issued
under this Indenture and then outstanding (including, without limitation,
consents obtained in connection with a tender offer or exchange offer for the
Notes), by notice to the Trustee.  Section 2.08
hereof shall determine which Notes are considered to be “outstanding” for
purposes of this Section 9.02.

 

Upon the request of the
Partnership accompanied by a resolution of its Board of Directors authorizing
the execution of any such amended or supplemental Indenture, and upon the
filing with the Trustee of evidence satisfactory to the Trustee of the consent
of the Holders of Notes as aforesaid, and upon receipt by the Trustee of the
documents described in Section 9.06 hereof, the Trustee will join with the
Issuers in the execution of such amended or supplemental Indenture unless such
amended or supplemental Indenture directly affects the Trustee’s own rights,
duties 

 

78

 

or immunities under this Indenture or
otherwise, in which case the Trustee may in its discretion, but will not be
obligated to, enter into such amended or supplemental Indenture.

 

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

 

After an amendment,
supplement or waiver under this Section 9.02 becomes effective, the
Issuers will mail to the Holders of Notes affected thereby a notice briefly
describing the amendment, supplement or waiver. 
Any failure of the Issuers to mail such notice, or any defect therein,
will not, however, in any way impair or affect the validity of any such amended
or supplemental Indenture or waiver. 
Subject to Sections 6.04 and 6.07 hereof, with the consent of the
Holders of a majority in principal amount of the Notes (including, without
limitation, Additional Notes, if any) then outstanding (including consents
obtained in connection with a tender offer or exchange offer for Notes) may
waive any existing default or compliance with any provision of this Indenture
or the Notes.  However, without the
consent of each Holder affected, an amendment or waiver under this Section 9.02
may not (with respect to any Notes held by a non-consenting Holder):

 

(1)                                  reduce the
principal amount of Notes whose Holders must consent to an amendment,
supplement or waiver;

 

(2)                                  reduce the
principal of or change the fixed maturity of any Note or alter the provisions
with respect to the redemption of the Notes other than as provided above with
respect to Sections 3.09, 4.10 and 4.14 hereof;

 

(3)                                  reduce the rate
of or change the time for payment of interest on any Note;

 

(4)                                  waive a Default
in the payment of principal or interest on the Notes;

 

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

 

(6)                                  make any change
in the provisions of this Indenture relating to waivers of past Defaults or the
rights of Holders of Notes to receive payments of principal, premium, if any,
or interest on the Notes; or

 

(7)                                  make any change
in the foregoing amendment and waiver provisions.

 

Section 9.03                                Compliance with
Trust Indenture Act.

 

Every amendment or
supplement to this Indenture or the Notes will be set forth in an amended or
supplemental Indenture that complies with the TIA as then in effect.

 

Section 9.04                                Revocation and
Effect of Consents.

 

Until an amendment,
supplement or waiver becomes effective, a consent to it by a Holder of a Note
is a continuing consent by the Holder of a Note and every subsequent Holder of
a Note or portion of a Note that evidences the same debt as the consenting
Holder’s Note, even if notation of the consent is not made on any Note.  However, any such Holder of a Note or 

 

79

 

subsequent Holder of a Note may revoke the
consent as to its Note if the Trustee receives written notice of revocation
before the date the waiver, supplement or amendment becomes effective.  An amendment, supplement or waiver becomes
effective in accordance with its terms and thereafter binds every Holder.

 

Section 9.05                                Notation on or
Exchange of Notes.

 

The Trustee may place an
appropriate notation about an amendment, supplement or waiver on any Note
thereafter authenticated.  The Issuers in
exchange for all Notes may issue and the Trustee shall, upon receipt of an Authentication
Order, authenticate new Notes that reflect the amendment, supplement or waiver.

 

Failure to make the
appropriate notation or issue a new Note will not affect the validity and
effect of such amendment, supplement or waiver.

 

Section 9.06                                Trustee to Sign
Amendments, etc.

 

The Trustee will sign any
amended or supplemental Indenture authorized pursuant to this Article 9 if
the amendment or supplement does not adversely affect the rights, duties,
liabilities or immunities of the Trustee. 
The Partnership may not sign an amendment or supplemental Indenture
until the Board of Directors approves it. 
In executing any amended or supplemental indenture, the Trustee shall
receive and (subject to Section 7.01 hereof) will be fully protected in
relying upon, in addition to the documents required by Section 11.04
hereof, an Officers’ Certificate and an Opinion of Counsel stating that the
execution of such amended or supplemental Indenture is authorized or permitted
by this Indenture.

 

ARTICLE 10.

SATISFACTION AND DISCHARGE

 

Section 10.01                          Satisfaction
and Discharge.

 

This Indenture will be
discharged and will cease to be of further effect as to all Notes issued
hereunder, when:

 

(1)                                  either:

 

(a) 
all Notes that have been authenticated (except lost, stolen or destroyed Notes
that have been replaced or paid and Notes for whose payment money has
theretofore been deposited in trust and thereafter repaid to the Issuers) have
been delivered to the Trustee for cancellation; or

 

(b) 
all Notes that have not been delivered to the Trustee for cancellation have
become due and payable by reason of the making of a notice of redemption or
otherwise or will become due and payable within one year and the Issuers has
irrevocably deposited or caused to be deposited with the Trustee as trust funds
in trust solely for the benefit of the Holders, cash in U.S. dollars,
non-callable Government Securities, or a combination thereof, in such amounts
as will be sufficient without consideration of any reinvestment of interest, to
pay and discharge the entire indebtedness on the Notes not 

 

80

 

delivered to the Trustee for
cancellation for principal, premium, if any, and accrued interest to the date
of maturity or redemption;

 

(2)                                  no Default or
Event of Default has occurred and is continuing on the date of such deposit or
will occur as a result of such deposit and such deposit will not result in a
breach or violation of, or constitute a default under, any other instrument to
which the Issuers are a party or by which the Issuers are bound;

 

(3)                                  the Issuers
have paid or caused to be paid all sums payable by them under this Indenture;
and

 

(4)                                  the Issuers
have delivered irrevocable instructions to the Trustee under this Indenture to
apply the deposited money toward the payment of the Notes at maturity or the
redemption date, as the case may be.

 

In addition, the Issuers
must deliver an Officers’ Certificate and an Opinion of Counsel to the Trustee
stating that all conditions precedent to satisfaction and discharge have been
satisfied.

 

Notwithstanding the
satisfaction and discharge of this Indenture, if money has been deposited with
the Trustee pursuant to subclause (b) of clause (1) of this Section,
the provisions of Section 10.02 and Section 8.06 will survive.  In addition, nothing in this Section 10.01
will be deemed to discharge those provisions of Section 7.07 hereof, that,
by their terms, survive the satisfaction and discharge of this Indenture.

 

Section 10.02                          Application of
Trust Money.

 

Subject to the provisions of
Section 8.06, all money deposited with the Trustee pursuant to Section 10.01
shall be held in trust and applied by it, in accordance with the provisions of
the Notes and this Indenture, to the payment, either directly or through any
Paying Agent (including the Issuers acting as their own Paying Agent) as the
Trustee may determine, to the Persons entitled thereto, of the principal (and
premium, if any) and interest for whose payment such money has been deposited
with the Trustee; but such money need not be segregated from other funds except
to the extent required by law.

 

If the Trustee or Paying
Agent is unable to apply any money or Government Securities in accordance with Section 10.01
by reason of any legal proceeding or by reason of any order or judgment of any
court or governmental authority enjoining, restraining or otherwise prohibiting
such application, the Issuers’ obligations under this Indenture and the Notes
shall be revived and reinstated as though no deposit had occurred pursuant to Section 10.01;
provided that if the Issuers has
made any payment of principal of, premium, if any, or interest on any Notes
because of the reinstatement of their obligations, the Issuers shall be
subrogated to the rights of the Holders of such Notes to receive such payment from
the money or Government Securities held by the Trustee or Paying Agent.

 

81

 

ARTICLE 11.

MISCELLANEOUS

 

Section 11.01                          Trust Indenture
Act Controls.

 

If any provision of this
Indenture limits, qualifies or conflicts with the duties imposed by TIA
§318(c), the imposed duties will control.

 

Section 11.02                          Notices.

 

Any notice or communication
by the Issuers or the Trustee to the others is duly given if in writing and
delivered in Person or mailed by first class mail (registered or certified,
return receipt requested), telecopier or overnight air courier guaranteeing
next day delivery, to the others’ address:

 

If to the Issuers:

Ferrellgas, L.P.

7500 College Boulevard

Suite 1000

Overland Park, KS 66210

Telecopier No.:  (913) 661-1537

Attention:  Ryan VanWinkle

With a copy to:

Bracewell & Giuliani LLP

1177 Avenue of the Americas

New York, NY 10036

Telecopier No.:  (212) 938-3819

Attention:  Robin J. Miles, Esq.

 

If to the Trustee:

U.S. Bank National Association 

100 Wall Street, Suite 1600

New York, NY 10005

Telecopier No.: 
(212) 809-5459

Attention: 
Corporate Trust Services

 

The Issuers or the Trustee,
by notice to the others may designate additional or different addresses for
subsequent notices or communications.

 

All notices and
communications (other than those sent to Holders) will be deemed to have been
duly given: at the time delivered by hand, if personally delivered; when
received, if mailed; when receipt acknowledged, if telecopied; and the next
Business Day after timely delivery to the courier, if sent by overnight air
courier guaranteeing next day delivery.

 

82

 

Any notice or communication
to a Holder will be mailed by first class mail, certified or registered, return
receipt requested, or by overnight air courier guaranteeing next day delivery
to its address shown on the register kept by the Registrar.  Any notice or communication will also be so
mailed to any Person described in TIA § 313(c), to the extent required by
the TIA.  Failure to mail a notice or
communication to a Holder or any defect in it will not affect its sufficiency
with respect to other Holders.

 

If a notice or communication
is mailed in the manner provided above within the time prescribed, it is duly
given, whether or not the addressee receives it.

 

If the Issuers mails a
notice or communication to Holders, they will mail a copy to the Trustee and
each Agent at the same time.

 

Section 11.03                          Communication
by Holders of Notes with Other Holders of Notes.

 

Holders may communicate
pursuant to TIA § 312(b) with other Holders with respect to their
rights under this Indenture or the Notes. 
The Issuers, the Trustee, the Registrar and anyone else shall have the
protection of TIA § 312(c).

 

Section 11.04                          Certificate and
Opinion as to Conditions Precedent.

 

Upon any request or
application by the Issuers to the Trustee to take any action under this
Indenture, the Issuers shall furnish to the Trustee:

 

(1)                                  an Officers’
Certificate in form and substance reasonably satisfactory to the Trustee (which
must include the statements set forth in Section 11.05 hereof) stating
that, in the opinion of the signers, all conditions precedent and covenants, if
any, provided for in this Indenture relating to the proposed action have been
satisfied; and

 

(2)                                  an Opinion of
Counsel in form and substance reasonably satisfactory to the Trustee (which
must include the statements set forth in Section 11.05 hereof) stating
that, in the opinion of such counsel, all such conditions precedent and
covenants have been satisfied.

 

Section 11.05                          Statements
Required in Certificate or Opinion.

 

Each certificate or opinion
with respect to compliance with a condition or covenant provided for in this
Indenture (other than a certificate provided pursuant to TIA § 314(a)(4))
must comply with the provisions of TIA § 314(e) and must include:

 

(1)                                  a statement
that the Person making such certificate or opinion has read such covenant or
condition;

 

(2)                                  a brief
statement as to the nature and scope of the examination or investigation upon
which the statements or opinions contained in such certificate or opinion are
based;

 

83

 

(3)                                  a statement
that, in the opinion of such Person, he or she has made such examination or
investigation as is necessary to enable him or her to express an informed
opinion as to whether or not such covenant or condition has been satisfied; and

 

(4)                                  a statement as
to whether or not, in the opinion of such Person, such condition or covenant
has been satisfied.

 

Section 11.06                          Rules by
Trustee and Agents.

 

The Trustee may make
reasonable rules for action by or at a meeting of Holders.  The Registrar or Paying Agent may make
reasonable rules and set reasonable requirements for its functions.

 

Section 11.07                          Non-Recourse.

 

The obligations of the
Issuers under this Indenture are non-recourse to Ferrellgas Partners and its
Affiliates, other than the Issuers and the General Partner, and are payable
only out of the Issuers’ cash flow and assets and the cash flow and assets of
the General Partner. The Trustee agrees, and each Holder of a Note, by
accepting a Note, agrees in this Indenture that Ferrellgas Partners and its
other Affiliates will not be liable for any of the Issuers’ obligations under
this Indenture or the Notes.

 

Section 11.08                          No Personal
Liability of Directors, Officers, Employees and Stockholders.

 

No limited partner of the
Partnership or director, officer, employee, incorporator or stockholder of the
General Partner, Finance Corp., as such, will have any liability for any
obligations of the Issuers under the Notes or this Indenture or any claim based
on, in respect of, or by reason of, such obligations.  Each Holder of Notes by accepting a Note
waives and releases all such liability. 
The waiver and release are part of the consideration for issuance of the
Notes.  The waiver may not be effective
to waive liabilities under the federal securities laws and it is the view of
the SEC that such waiver is against public policy.

 

Section 11.09                          Governing Law.

 

THE INTERNAL LAW OF THE
STATE OF NEW YORK WILL GOVERN AND BE USED TO CONSTRUE THIS INDENTURE AND THE
NOTES WITHOUT GIVING EFFECT TO APPLICABLE PRINCIPLES OF CONFLICTS OF LAW TO THE
EXTENT THAT THE APPLICATION OF THE LAWS OF ANOTHER JURISDICTION WOULD BE
REQUIRED THEREBY.

 

Section 11.10                          Successors.

 

All agreements of the
Issuers in this Indenture and the Notes will bind their successors.  All agreements of the Trustee in this
Indenture will bind its successors.

 

84

 

Section 11.11                          Severability.

 

In case any provision in
this Indenture or in the Notes is invalid, illegal or unenforceable, the
validity, legality and enforceability of the remaining provisions will not in
any way be affected or impaired thereby.

 

Section 11.12                          Counterpart
Originals.

 

The parties may sign any
number of copies of this Indenture.  Each
signed copy will be an original, but all of them together represent the same
agreement.

 

Section 11.13                          Table of
Contents, Headings, etc.

 

The Table of Contents,
Cross-Reference Table and Headings of the Articles and Sections of this
Indenture have been inserted for convenience of reference only, are not to be
considered a part of this Indenture and will in no way modify or restrict any of
the terms or provisions hereof.

 

Section 11.14                          Force Majeure.

 

In no event shall the
Trustee be responsible or liable for any failure or delay in the performance of
its obligations hereunder arising out of or caused by, directly or indirectly,
forces beyond its control, including, without limitation, strikes, work
stoppages, accidents, acts of war or terrorism, civil or military disturbances,
nuclear or natural catastrophes or acts of God, and interruptions, loss or
malfunctions of utilities, communications or computer (software and hardware)
services; it being understood that the Trustee shall use reasonable efforts
which are consistent with accepted practices in the banking industry to resume
performance as soon as practicable under the circumstances.

 

Section 11.15                          U.S.A. Patriot
Act

 

The parties hereto
acknowledge that in accordance with Section 326 of the U.S.A. Patriot Act,
the Trustee, like all financial institutions and in order to help fight the
funding of terrorism and money laundering, is required to obtain, verify, and
record information that identifies each person or legal entity that establishes
a relationship or opens an account with the Trustee.  The parties to this Indenture agree that they
will provide the Trustee with such information as it may request in order for
the Trustee to satisfy the requirements of the U.S.A. Patriot Act.

 

[Signatures on following page]

 

85

 

SIGNATURES

 

Dated as of September 14, 2009

 

	
   

  	
   

  	
  Very truly yours,

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  FERRELLGAS, L.P.

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  By: Ferrellgas, Inc., its General Partner

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
  By:

  	
  /s/ J. Ryan VanWinkle

  
	
   

  	
   

  	
   

  	
   

  	
  Name: J. Ryan VanWinkle

  
	
   

  	
   

  	
   

  	
   

  	
  Title: Chief Financial Officer

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  FERRELLGAS FINANCE CORP.

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  By:

  	
  /s/ J. Ryan VanWinkle

  
	
   

  	
   

  	
  Name: J. Ryan VanWinkle

  
	
   

  	
   

  	
  Title: Chief Financial Officer

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
  U.S. BANK NATIONAL ASSOCIATION,

  	
   

  	
   

  
	
  as Trustee

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  By:

  	
  /s/ Thomas E. Tabor

  	
   

  	
   

  
	
   

  	
  Name:  Thomas E. Tabor

  	
   

  	
   

  
	
   

  	
  Title:  Vice President

  	
   

  	
   

  

 

86

 

EXHIBIT A1

 

[Face of Note]

 

CUSIP                      

 

9.125% Senior Notes due 2017

 

	
  No.

  	
  $

  

 

FERRELLGAS, L.P.

FERRELLGAS FINANCE CORP.

 

promises
to pay to CEDE & CO. or registered assigns,

 

the
principal sum of

Dollars
on October 1, 2017.

 

Interest
Payment Dates:  April 1 and October 1

 

Record
Dates:  March 15 and September 15

 

	
  Dated:

  	
   

  	
   

  

 

	
   

  	
  FERRELLGAS,
  L.P.

  
	
   

  	
   

  
	
   

  	
  By:
  Ferrellgas, Inc., its General Partner

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
   

  
	
   

  	
  Name:
  J. Ryan VanWinkle

  
	
   

  	
  Title:
  Chief Financial Officer

  
	
   

  	
   

  
	
   

  	
  FERRELLGAS
  FINANCE CORP.

  
	
   

  	
   

  
	
   

  	
  By:

  	
   

  
	
   

  	
  Name:
  J. Ryan VanWinkle

  
	
   

  	
  Title:
  Chief Financial Officer

  
	
   

  	
   

  
	
  This is one of the Notes
  referred to in the within-mentioned Indenture:

  	
   

  	
   

  
	
   

  	
   

  
	
   

  	
   

  
	
  U.S. BANK NATIONAL
  ASSOCIATION

  	
   

  
	
    as Trustee

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  By:

  	
   

  	
   

  	
   

  
	
   

  	
  Authorized
  Signatory

  	
   

  	
   

  
						

 

A1-1

 

[Back of Note]

 

9.125% Senior Notes due 2017

 

[Insert
the Global Note Legend, if applicable pursuant to the provisions of the
Indenture]

 

[Insert
Private Placement Legend, if applicable pursuant to the provisions of the
Indenture]

 

Capitalized terms used
herein have the meanings assigned to them in the Indenture referred to below
unless otherwise indicated.

 

(1)           INTEREST.  Ferrellgas, L.P., a Delaware limited
partnership, and Ferrellgas Finance Corp., a Delaware corporation (together,
the “Issuers”), promise to pay interest on the principal amount of this Note at
9.125%  per annum from September 14,
2009 until maturity.  The Issuers will
pay interest semi-annually in arrears on April 1 and October 1 of
each year, or if any such day is not a Business Day, on the next succeeding
Business Day (each, an “Interest Payment Date”).  Interest on the Notes will accrue from the
most recent date to which interest has been paid or, if no interest has been
paid, from the date of issuance; provided
that if there is no existing Default in the payment of interest, and if this
Note is authenticated between a record date referred to on the face hereof and
the next succeeding Interest Payment Date, interest shall accrue from such next
succeeding Interest Payment Date; provided,
further, that the first Interest Payment Date shall be April 1,
2010.  The Issuers will pay interest
(including post-petition interest in any proceeding under any Bankruptcy Law)
on overdue principal and premium, if any, from time to time on demand at a rate
that is 1% per annum in excess of the rate then in effect; they will pay
interest (including post-petition interest in any proceeding under any Bankruptcy
Law) on overdue installments of interest (without regard to any applicable
grace periods) from time to time on demand at the same rate to the extent
lawful.  Interest will be computed on the
basis of a 360-day year of twelve 30-day months.

 

(2)           METHOD
OF PAYMENT.  The Issuers will
pay interest on the Notes to the Persons who are registered Holders of Notes at
the close of business on the April 15 or October 15 next preceding
the Interest Payment Date, even if such Notes are canceled after such record
date and on or before such Interest Payment Date, except as provided in Section 2.12
of the Indenture with respect to defaulted interest.  The Notes will be payable as to principal,
premium, if any, and interest at the office or agency of the Issuers maintained
for such purpose within the City and State of New York, or, at the option of
the Issuers, payment of interest may be made by check mailed to the Holders at
their addresses set forth in the register of Holders; provided that payment by wire transfer of
immediately available funds will be required with respect to principal of and
interest, premium on, all Global Notes the Holders of which will have provided
wire transfer instructions to the Issuers or the Paying Agent.  Such payment will be in such coin or currency
of the United States of America as at the time of payment is legal tender for
payment of public and private debts.

 

(3)           PAYING
AGENT AND REGISTRAR. 
Initially, U.S. Bank National Association, the Trustee under the
Indenture, will act as Paying Agent and Registrar.  The Issuers may 

 

A1-2

 

change any Paying Agent or
Registrar without notice to any Holder. 
The Issuers or any of their Subsidiaries may act in any such capacity.

 

(4)           INDENTURE.  The Issuers issued the Notes under an
Indenture dated as of September 14, 2009 (the “Indenture”) among the
Issuers and the Trustee.  The terms of
the Notes include those stated in the Indenture and those made part of the
Indenture by reference to the Trust Indenture Act of 1939, as amended (15 U.S.
Code §§ 77aaa-77bbbb).  The Notes are
subject to all such terms, and Holders are referred to the Indenture and such
Act for a statement of such terms.  To
the extent any provision of this Note conflicts with the express provisions of
the Indenture, the provisions of the Indenture shall govern and be
controlling.  The Notes are unsecured
obligations of the Issuers.

 

(5)           Optional
Redemption.

 

The
Issuers will not have the option to redeem the Notes prior to October 1,
2013.  Thereafter, the Issuers will have
the option to redeem the Notes, in whole or in part, upon not less than 30 nor
more than 60 days’ notice, at the redemption prices (expressed as percentages
of principal amount) set forth below plus accrued and unpaid interest thereon
to the applicable redemption date, if redeemed during the twelve months
beginning on October 1 of the years indicated below:

 

	
  Year

  	
   

  	
  Percentage

  	
   

  
	
  2013

  	
   

  	
  104.563

  	
  %

  
	
  2014

  	
   

  	
  102.281

  	
  %

  
	
  2015 and thereafter

  	
   

  	
  100.000

  	
  %

  

 

(6)           Mandatory
Redemption.

 

The Issuers will not be
required to make mandatory redemption payments with respect to the Notes.

 

(7)           Repurchase
at Option of Holder.

 

(a) 
If there is a Change of Control, the Issuers will be required to make an offer
(a “Change of Control Offer”) to repurchase, in cash, all or any part (equal to
$2,000 or an integral multiple of $1,000 in excess thereof) of each Holder’s
Notes at a purchase price equal to 101% of the aggregate principal amount
thereof plus accrued and unpaid interest thereon, if any, to the date of
purchase ( the “Change of Control Payment”). 
Within 30 days following any Change of Control, the Issuers will mail a
notice to each Holder setting forth the procedures governing the Change of
Control Offer as required by the Indenture.

 

(b) 
If the Partnership or any of its Restricted Subsidiary consummates any Asset
Sales, within 15 days of each date on which the aggregate amount of Excess
Proceeds exceeds $20 million, the Issuers will commence an offer to all Holders
of Notes and all holders of other Indebtedness that are pari passu with the Notes containing
provisions similar to those set forth in this Indenture with respect to offers
to purchase or redeem with the proceeds of sales of assets (an “Asset Sale
Offer”) pursuant to Section 

 

A1-3

 

3.09 of the Indenture to
purchase the maximum principal amount of Notes and other pari passu Indebtedness that may be
purchased out of the Excess Proceeds at an offer price in cash in an amount
equal to 100% of the principal amount thereof plus accrued and unpaid interest
thereon, if any, to the date fixed for the closing of such offer, in accordance
with the procedures set forth in the Indenture. 
To the extent that the aggregate amount of Notes and other pari passu Indebtedness tendered pursuant
to an Asset Sale Offer is less than the Excess Proceeds, the Partnership or any
Restricted Subsidiary may use such deficiency for general business
purposes.  If the aggregate principal
amount of Notes and other pari passu
Indebtedness surrendered by holders thereof exceeds the amount of Excess
Proceeds, the Trustee shall select the Notes and other pari passu Indebtedness to be purchased on
a pro rata basis.  Holders of Notes that are the subject of an
offer to purchase will receive an Asset Sale Offer from the Issuers prior to
any related purchase date and may elect to have such Notes purchased by
completing the form entitled “Option of Holder to Elect Purchase” on the
reverse of the Notes.

 

(8)           NOTICE
OF REDEMPTION.  Notice of
redemption will be mailed at least 10 days but not more than 60 days before the
redemption date to each Holder whose Notes are to be redeemed at its registered
address.  Notes in denominations larger
than $2,000 may be redeemed in part but only in whole multiples of $1,000,
unless all of the Notes held by a Holder are to be redeemed.  On and after the redemption date interest
ceases to accrue on Notes or portions thereof called for redemption.

 

(9)           DENOMINATIONS,
TRANSFER, EXCHANGE.  The Notes
are in registered form without coupons in denominations of $2,000 and integral
multiples of $1,000 in excess thereof. 
The transfer of Notes may be registered and Notes may be exchanged as
provided in the Indenture.  The Registrar
and the Trustee may require a Holder, among other things, to furnish
appropriate endorsements and transfer documents and the Issuers may require a
Holder to pay any taxes and fees required by law or permitted by the
Indenture.  The Issuers need not exchange
or register the transfer of any Note or portion of a Note selected for
redemption, except for the unredeemed portion of any Note being redeemed in
part.  Also, the Issuers need not
exchange or register the transfer of any Notes for a period of 15 days before a
selection of Notes to be redeemed or during the period between a record date
and the corresponding Interest Payment Date.

 

(10)         PERSONS
DEEMED OWNERS.  The registered
Holder of a Note may be treated as its owner for all purposes.

 

(11)         AMENDMENT,
SUPPLEMENT AND WAIVER.  Subject
to certain exceptions, the Indenture or the Notes may be amended or
supplemented with the consent of the Holders of at least a majority in
principal amount of the then outstanding Notes (including, consents obtained in
connection with a tender offer or exchange offer for Notes), and any existing
default or compliance with any provision of the Indenture or the Notes may be
waived with the consent of the Holders of a majority in aggregate principal
amount of the then outstanding Notes (including, consents obtained in
connection with a tender offer or exchange offer for Notes).  Without the consent of any Holder of a Note,
the Indenture or the Notes may be amended or supplemented to cure any
ambiguity, defect or inconsistency, to provide for uncertificated Notes in
addition to or in place of certificated Notes, to provide for the assumption of
the Issuers’ obligations to Holders of the Notes in case of a merger or
consolidation, to make any change that could provide any additional 

 

A1-4

 

rights or benefits to the
Holders of the Notes that does not adversely affect the legal rights under the
Indenture of any such Holder, to comply with the requirements of the SEC in
order to effect or maintain the qualification of the Indenture under the Trust
Indenture Act, or to provide for security for or add guarantees with respect to
the Notes.

 

(12)         DEFAULTS
AND REMEDIES.  Events of
Default include:  Each of the following
is an “Event of Default”: (i) default in the payment of the principal of
or premium, if any, on any Note when the same becomes due and payable, upon
stated maturity, acceleration, optional redemption, required purchase,
scheduled principal payment or otherwise; (ii) default in the payment of
an installment of interest on any of the Notes, when the same becomes due and
payable, which default continues for a period of 30 days; (iii) failure of
the Issuers to perform or observe any other term, covenant or agreement
contained in the Notes or the Indenture, other than a default specified in
either (i) or (ii) above, and the default continues for a period of
45 days after written notice of the default requiring the Issuers to remedy the
same has been given to the Partnership by the Trustee or to the Issuers and the
Trustee by Holders of at least 25% in aggregate principal amount of the Notes
then outstanding; (iv) default or defaults under certain other agreements,
instruments, mortgages, bonds, debentures or other evidences of Indebtedness
under which the Partnership or any Restricted Subsidiary of the Partnership has
outstanding Indebtedness in excess of $25 million if the default (x) is
caused by a failure to pay principal of or premium, if any, or interest on to
such Indebtedness within the applicable grace period, if any, provided with
respect to such Indebtedness or (y) results in the acceleration of such
Indebtedness prior to its stated maturity; (v) certain final judgment or
judgments, which is or are non-appealable and non-reviewable or which has or
have not been stayed pending appeal or review or as to which all rights to
appeal or review have expired or been exhausted, shall have been rendered
against the Partnership, any Restricted Subsidiary or the General Partner
provided such judgment or judgments requires or require the payment of money in
excess of $25 million in the aggregate and is not covered by insurance or
discharged or stayed pending appeal or review within 60 days after entry of
such judgment or in the event of a stay, within 30 days after the stay expires;
or (vi) specified events of bankruptcy, insolvency, or reorganization with
respect to the Issuers or any of their Significant Subsidiaries as more fully
set forth in the Indenture.  If any Event
of Default occurs and is continuing, the Trustee or the Holders of at least 25%
in principal amount of the applicable series of Notes then outstanding Notes
may declare all the Notes of that series to be due and payable.  Notwithstanding the foregoing, in the case of
an Event of Default arising from certain events of bankruptcy or insolvency,
with respect to the Partnership, Finance Corp. or any Significant Subsidiary,
all outstanding Notes will become due and payable without further action or
notice.  Holders may not enforce the
Indenture or the Notes except as provided in the Indenture.  Subject to certain limitations, Holders of a
majority in principal amount of a series of then outstanding Notes may direct
the Trustee of that series of Notes in its exercise of any trust or power. The
Trustee may withhold from Holders of the Notes notice of any continuing Default
or Event of Default (except a Default or Event of Default relating to the
payment of principal or interest) if it determines in good faith that
withholding notice is in their interest. 
The Holders of a majority in aggregate principal amount of a series of
Notes then outstanding by notice to the Trustee for those Notes may on behalf
of all Holders of Notes of that series waive any existing Default or Event of
Default and its consequences under the Indenture except a continuing Default or
Event of Default in the payment of interest on, or the principal of, 

 

A1-5

 

the Notes.  The Issuers are required to deliver to the
Trustee annually a statement regarding compliance with the Indenture, and the
Issuers are required upon becoming aware of any Default or Event of Default, to
deliver to the Trustee a statement specifying such Default or Event of Default.

 

(13)         TRUSTEE
DEALINGS WITH ISSUERS.  The
Trustee, in its individual or any other capacity, may make loans to, accept
deposits from, and perform services for the Issuers or their Affiliates, and
may otherwise deal with the Issuers or their Affiliates, as if it were not the
Trustee.

 

(14)         NO
RECOURSE AGAINST OTHERS.  A
limited partner of the Partnership or director, officer, employee, incorporator
or stockholder of the General Partner or Finance Corp., as such, will not have
any liability for any obligations of the Issuers under the Notes or the
Indenture or for any claim based on, in respect of, or by reason of, such
obligations.  Each Holder by accepting a
Note waives and releases all such liability. 
The waiver and release are part of the consideration for the issuance of
the Notes.

 

(15)         AUTHENTICATION.  This Note will not be valid until
authenticated by the manual signature of the Trustee or an authenticating
agent.

 

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

 

(17)         ADDITIONAL
RIGHTS OF HOLDERS OF RESTRICTED GLOBAL NOTES AND RESTRICTED DEFINITIVE NOTES.  In addition to the rights provided to Holders
of Notes under the Indenture, Holders of Restricted Global Notes and Restricted
Definitive Notes will have all the rights set forth in the Registration Rights
Agreement dated as of September 14, 2009, among the Issuers and the other
parties named on the signature pages thereof or, in the case of Additional
Notes, Holders of Restricted Global Notes and Restricted Definitive Notes will
have the rights set forth in one or more registration rights agreements, if
any, among the Issuers and the other parties thereto, relating to rights given
by the Issuers to the purchasers of any Additional Notes (collectively, the “Registration
Rights Agreement”).

 

(18)         CUSIP
NUMBERS.  Pursuant to a
recommendation promulgated by the Committee on Uniform Security Identification
Procedures, the Issuers have caused CUSIP numbers to be printed on the Notes
and the Trustee may use CUSIP numbers in notices of redemption as a convenience
to Holders.  No representation is made as
to the accuracy of such numbers either as printed on the Notes or as contained
in any notice of redemption and reliance may be placed only on the other
identification numbers placed thereon.

 

(19)         GOVERNING
LAW.  THE INTERNAL LAW OF THE
STATE OF NEW YORK WILL GOVERN AND BE USED TO CONSTRUE THE INDENTURE AND THIS
NOTE  WITHOUT GIVING EFFECT TO APPLICABLE
PRINCIPLES OF CONFLICTS OF LAW TO THE EXTENT THAT THE APPLICATION OF THE LAWS
OF ANOTHER JURISDICTION WOULD BE REQUIRED THEREBY.

 

A1-6

 

The Issuers will furnish to
any Holder upon written request and without charge a copy of the
Indenture.  Requests may be made to:

 

Ferrellgas, L.P.

7500 College Boulevard

Suite 1000

Overland Park, Kansas  66210

Attention:  Investor Relations

(913) 661-1537

 

A1-7

 

ASSIGNMENT FORM

 

To assign this Note, fill in
the form below:

 

	
  (I) or
  (we) assign and transfer this Note to:

  	
   

  

(Insert assignee’s legal name)

 

	
   

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

  

 

	
   

  
	
   

  
	
   

  
	
   

  

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

 

and
irrevocably appoint

to
transfer this Note on the books of the Issuers. 
The agent may substitute another to act for him.

 

	
  Date:

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  Your Signature:

  	
   

  
	
   

  	
   

  	
  (Sign exactly as your name appears on the face of this Note)

  

 

	
  Signature Guarantee*:

  	
   

  	
   

  

 

*              Participant in a
recognized Signature Guarantee Medallion Program (or other signature guarantor
acceptable to the Trustee).

 

A1-8

 

OPTION OF HOLDER TO ELECT PURCHASE

 

If you want to elect to have
this Note purchased by the Issuers pursuant to Section 4.10 or 4.14 of the
Indenture, check the appropriate box below:

 

	
  o Section 4.10

  	
  o
  Section 4.14

  

 

If you want to elect to have
only part of the Note purchased by the Issuers pursuant to Section 4.10 or
Section 4.14 of the Indenture, state the amount you elect to have
purchased:

 

$                       

 

	
  Date:

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  Your Signature:

  	
   

  
	
   

  	
   

  	
  (Sign exactly as your name appears on the face of this Note)

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  Tax Identification No.:

  	
   

  
	
   

  	
   

  	
   

  
						

 

	
  Signature Guarantee*:

  	
   

  	
   

  

 

*              Participant in a
recognized Signature Guarantee Medallion Program (or other signature guarantor
acceptable to the Trustee).

 

A1-9

 

SCHEDULE OF EXCHANGES OF INTERESTS IN THE GLOBAL
NOTE*

 

The following exchanges of a
part of this Global Note for an interest in another Global Note or for a
Definitive Note, or exchanges of a part of another Global Note or Definitive
Note for an interest in this Global Note, have been made:

 

	
  Date of Exchange

  	
   

  	
  Amount
  of decrease in

  Principal Amount of 

  this Global Note

  	
   

  	
  Amount
  of increase in

  Principal Amount of 

  this Global Note

  	
   

  	
  Principal
  Amount

  of this Global Note

  following such decrease 

  (or increase)

  	
   

  	
  Signature
  of authorized

  signatory of Trustee or

  Custodian

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  

 

* This
schedule should be included only if the Note is issued in global form.

 

A1-10

 

EXHIBIT A2

 

[Face of Regulation S Temporary Global Note]

 

CUSIP                  

 

9.125% Senior Notes due 2017

 

	
  No.

  	
  $

  

 

FERRELLGAS, L.P.

FERRELLGAS FINANCE CORP.

 

promises
to pay to CEDE & CO. or registered assigns,

 

the
principal sum of                                                                                                                     

Dollars
on October 1, 2017.

 

Interest
Payment Dates:  April 1 and October 1

 

Record
Dates:  March 15 and September 15

 

	
  Dated:

  	
   

  	
   

  

 

	
   

  	
  FERRELLGAS,
  L.P.

  
	
   

  	
   

  
	
   

  	
  By:
  Ferrellgas, Inc., its General Partner

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
   

  
	
   

  	
  Name:
  J. Ryan VanWinkle

  
	
   

  	
  Title:
  Chief Financial Officer

  
	
   

  	
   

  
	
   

  	
  FERRELLGAS
  FINANCE CORP.

  
	
   

  	
   

  
	
   

  	
  By:

  	
   

  
	
   

  	
  Name:
  J. Ryan VanWinkle

  
	
   

  	
  Title:
  Chief Financial Officer

  
	
   

  	
   

  
	
  This is one of the Notes
  referred to in the within-mentioned Indenture:

  	
   

  	
   

  
	
   

  	
   

  
	
   

  	
   

  
	
  U.S. BANK NATIONAL
  ASSOCIATION

  	
   

  
	
    as Trustee

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  By:

  	
   

  	
   

  	
   

  
	
   

  	
  Authorized
  Signatory

  	
   

  	
   

  
						

 

A2-1

 

[Back of Regulation S Temporary Global Note]

9.125% Senior Notes due 2017

 

THE RIGHTS ATTACHING TO THIS
REGULATION S TEMPORARY GLOBAL NOTE, AND THE CONDITIONS AND PROCEDURES GOVERNING
ITS EXCHANGE FOR CERTIFICATED NOTES, ARE AS SPECIFIED IN THE INDENTURE (AS
DEFINED HEREIN).  NEITHER THE HOLDER NOR
THE BENEFICIAL OWNERS OF THIS REGULATION S TEMPORARY GLOBAL NOTE SHALL BE
ENTITLED TO RECEIVE PAYMENT OF INTEREST HEREON.

 

THIS GLOBAL NOTE IS HELD BY
THE DEPOSITARY (AS DEFINED IN THE INDENTURE GOVERNING THIS NOTE) OR ITS NOMINEE
IN CUSTODY FOR THE BENEFIT OF THE BENEFICIAL OWNERS HEREOF, AND IS NOT TRANSFERABLE
TO ANY PERSON UNDER ANY CIRCUMSTANCES EXCEPT THAT (I) THE TRUSTEE MAY MAKE
SUCH NOTATIONS HEREON AS MAY BE REQUIRED PURSUANT TO SECTION 2.06 OF
THE INDENTURE, (II) THIS GLOBAL NOTE MAY BE EXCHANGED IN WHOLE BUT
NOT IN PART PURSUANT TO SECTION 2.06(a) OF THE INDENTURE, (III) THIS
GLOBAL NOTE MAY BE DELIVERED TO THE TRUSTEE FOR CANCELLATION PURSUANT TO SECTION 2.11
OF THE INDENTURE AND (IV) THIS GLOBAL NOTE MAY BE TRANSFERRED TO A
SUCCESSOR DEPOSITARY WITH THE PRIOR WRITTEN CONSENT OF THE ISSUERS.

 

UNLESS AND UNTIL IT IS
EXCHANGED IN WHOLE OR IN PART FOR NOTES IN DEFINITIVE FORM, THIS NOTE MAY NOT
BE TRANSFERRED EXCEPT AS A WHOLE BY THE DEPOSITARY TO A NOMINEE OF THE
DEPOSITARY OR BY A NOMINEE OF THE DEPOSITARY TO THE DEPOSITARY OR ANOTHER
NOMINEE OF THE DEPOSITARY OR BY THE DEPOSITARY OR ANY SUCH NOMINEE TO A
SUCCESSOR DEPOSITARY OR A NOMINEE OF SUCH SUCCESSOR DEPOSITARY.  UNLESS THIS CERTIFICATE IS PRESENTED BY AN
AUTHORIZED REPRESENTATIVE OF THE DEPOSITORY TRUST COMPANY (55 WATER STREET, NEW
YORK, NEW YORK) (“DTC”), TO THE ISSUERS OR THEIR AGENT FOR REGISTRATION OF
TRANSFER, EXCHANGE OR PAYMENT, AND ANY CERTIFICATE ISSUED IS REGISTERED IN THE
NAME OF CEDE & CO. OR SUCH OTHER NAME AS MAY BE REQUESTED BY AN
AUTHORIZED REPRESENTATIVE OF DTC (AND ANY PAYMENT IS MADE TO CEDE &
CO. OR SUCH OTHER ENTITY AS MAY BE REQUESTED BY AN AUTHORIZED
REPRESENTATIVE OF DTC), ANY TRANSFER, PLEDGE OR OTHER USE HEREOF FOR VALUE OR
OTHERWISE BY OR TO ANY PERSON IS WRONGFUL INASMUCH AS THE REGISTERED OWNER
HEREOF, CEDE & CO., HAS AN INTEREST HEREIN.

 

THIS NOTE HAS NOT BEEN REGISTERED UNDER THE
SECURITIES ACT OF 1933, AS AMENDED (THE “SECURITIES ACT”), OR ANY STATE
SECURITIES LAWS. NEITHER THIS NOTE, NOR ANY INTEREST OR PARTICIPATION HEREIN MAY BE
OFFERED, 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 THE REGISTRATION REQUIREMENTS OF THE SECURITIES ACT.
THE HOLDER OF THIS NOTE, BY ITS 

 

A2-2

 

ACCEPTANCE HEREOF, AGREES NOT TO OFFER, SELL
OR OTHERWISE TRANSFER SUCH SECURITY, PRIOR TO THE DATE WHICH IS ONE YEAR 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 NOTE (OR ANY
PREDECESSOR OF THIS NOTE) (THE “RESALE RESTRICTION TERMINATION DATE”), EXCEPT
THAT THE NOTES MAY BE TRANSFERRED (A) TO THE COMPANY OR ANY
SUBSIDIARY THEREOF, (B) PURSUANT TO AN EFFECTIVE REGISTRATION STATEMENT
UNDER THE SECURITIES ACT, (C) FOR SO LONG AS THE NOTES ENDORSED THEREON
ARE ELIGIBLE FOR RESALE PURSUANT TO RULE 144A UNDER THE SECURITIES ACT (“RULE
144A”), TO A PERSON IT REASONABLY BELIEVES IS A “QUALIFIED INSTITUTIONAL BUYER”
AS DEFINED IN RULE 144A 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, (D) PURSUANT TO OFFERS AND SALES TO
NON-U.S. PERSONS THAT OCCUR OUTSIDE THE UNITED STATES WITHIN THE MEANING OF AND
IN COMPLIANCE WITH REGULATION S UNDER THE SECURITIES ACT, (E) TO AN
INSTITUTIONAL “ACCREDITED INVESTOR” (AS DEFINED IN RULE 501(A)(1), (2), (3) OR
(7) OF REGULATION D UNDER THE SECURITIES ACT) THAT, PRIOR TO SUCH TRANSFER,
FURNISHES THE TRUSTEE A SIGNED LETTER CONTAINING CERTAIN REPRESENTATIONS AND
AGREEMENTS RELATING TO THE TRANSFER OF THE NOTES AND, IF SUCH TRANSFER IS IN
RESPECT OF AN AGGREGATE PRINCIPAL AMOUNT OF NOTES LESS THAN $250,000, AN
OPINION OF COUNSEL ACCEPTABLE TO THE ISSUERS THAT SUCH TRANSFER IS IN
COMPLIANCE WITH THE SECURITIES ACT, OR (F) PURSUANT TO ANOTHER AVAILABLE
EXEMPTION FROM THE REGISTRATION REQUIREMENTS OF THE SECURITIES ACT, SUBJECT TO
THE COMPANY’S AND THE TRUSTEE’S RIGHT PRIOR TO ANY SUCH OFFER, SALE OR TRANSFER
(1) PURSUANT TO CLAUSE (D) PRIOR TO THE END OF THE 40-DAY
DISTRIBUTION COMPLIANCE PERIOD WITHIN THE MEANING OF REGULATION S UNDER THE
SECURITIES ACT OR PURSUANT TO CLAUSE (F) PRIOR TO THE RESALE RESTRICTION
TERMINATION DATE TO REQUIRE THE DELIVERY OF AN OPINION OF COUNSEL,
CERTIFICATION AND/OR OTHER INFORMATION SATISFACTORY TO EACH OF THEM, AND (2) IN
EACH OF THE FOREGOING CASES, TO REQUIRE THAT A CERTIFICATE OF TRANSFER IN THE FORM APPEARING
ON THIS NOTE IS COMPLETED AND DELIVERED BY THE TRANSFEROR TO THE TRUSTEE. THIS
LEGEND WILL BE REMOVED UPON THE REQUEST OF A HOLDER AFTER THE RESALE
RESTRICTION TERMINATION DATE.

 

Capitalized terms used
herein have the meanings assigned to them in the Indenture referred to below
unless otherwise indicated.

 

(1)           INTEREST.  Ferrellgas, L.P., a Delaware limited
partnership, and Ferrellgas Finance Corp., a Delaware corporation (together,
the “Issuers”), promise to pay interest on the principal amount of this Note at
9.125%  per annum from September 14,
2009 until maturity.  The Issuers will
pay interest semi-annually in arrears on April 1 and October 1 of
each year, or if any such day is not a Business Day, on the next succeeding
Business Day (each, an “Interest Payment Date”).  Interest on the Notes will accrue from 

 

A2-3

 

the most recent date to
which interest has been paid or, if no interest has been paid, from the date of
issuance; provided that if there
is no existing Default in the payment of interest, and if this Note is
authenticated between a record date referred to on the face hereof and the next
succeeding Interest Payment Date, interest shall accrue from such next
succeeding Interest Payment Date; provided,
further, that the first Interest Payment Date shall be April 1,
2010.  The Issuers will pay interest
(including post-petition interest in any proceeding under any Bankruptcy Law)
on overdue principal and premium, if any, from time to time on demand at a rate
that is 1% per annum in excess of the rate then in effect; they will pay
interest (including post-petition interest in any proceeding under any
Bankruptcy Law) on overdue installments of interest (without regard to any
applicable grace periods) from time to time on demand at the same rate to the
extent lawful.  Interest will be computed
on the basis of a 360-day year of twelve 30-day months.

 

Until this Regulation S Temporary Global Note
is exchanged for one or more Regulation S Permanent Global Notes, the Holder
hereof shall not be entitled to receive payments of interest hereon; until so
exchanged in full, this Regulation S Temporary Global Note shall in all other
respects be entitled to the same benefits as other Notes under the Indenture.

 

(2)           METHOD
OF PAYMENT.  The Issuers will
pay interest on the Notes to the Persons who are registered Holders of Notes at
the close of business on the April 15 or October 15 next preceding
the Interest Payment Date, even if such Notes are canceled after such record
date and on or before such Interest Payment Date, except as provided in Section 2.12
of the Indenture with respect to defaulted interest.  The Notes will be payable as to principal,
premium, if any, and interest at the office or agency of the Issuers maintained
for such purpose within the City and State of New York, or, at the option of
the Issuers, payment of interest may be made by check mailed to the Holders at
their addresses set forth in the register of Holders; provided that payment by wire transfer of
immediately available funds will be required with respect to principal of and
interest, premium on, all Global Notes the Holders of which will have provided
wire transfer instructions to the Issuers or the Paying Agent.  Such payment will be in such coin or currency
of the United States of America as at the time of payment is legal tender for
payment of public and private debts.

 

(3)           PAYING
AGENT AND REGISTRAR. 
Initially, U.S. Bank National Association, the Trustee under the
Indenture, will act as Paying Agent and Registrar.  The Issuers may change any Paying Agent or
Registrar without notice to any Holder. 
The Issuers or any of their Subsidiaries may act in any such capacity.

 

(4)           INDENTURE.  The Issuers issued the Notes under an
Indenture dated as of September 14, 2009 (the “Indenture”) among the
Issuers and the Trustee.  The terms of
the Notes include those stated in the Indenture and those made part of the
Indenture by reference to the Trust Indenture Act of 1939, as amended (15 U.S.
Code §§ 77aaa-77bbbb).  The Notes are
subject to all such terms, and Holders are referred to the Indenture and such
Act for a statement of such terms.  To
the extent any provision of this Note conflicts with the express provisions of
the Indenture, the provisions of the Indenture shall govern and be
controlling.  The Notes are unsecured
obligations of the Issuers.

 

A2-4

 

(5)           Optional
Redemption.

 

The
Issuers will not have the option to redeem the Notes prior to October 1,
2013.  Thereafter, the Issuers will have
the option to redeem the Notes, in whole or in part, upon not less than 30 nor
more than 60 days’ notice, at the redemption prices (expressed as percentages
of principal amount) set forth below plus accrued and unpaid interest thereon
to the applicable redemption date, if redeemed during the twelve months
beginning on October 1 of the years indicated below:

 

	
  Year

  	
   

  	
  Percentage

  	
   

  
	
  2013

  	
   

  	
  104.563

  	
  %

  
	
  2014

  	
   

  	
  102.281

  	
  %

  
	
  2015 and thereafter

  	
   

  	
  100.000

  	
  %

  

 

(1)           Mandatory
Redemption.

 

The Issuers will not be
required to make mandatory redemption payments with respect to the Notes.

 

(2)           Repurchase
at Option of Holder.

 

(a) 
If there is a Change of Control, the Issuers will be required to make an offer
(a “Change of Control Offer”) to repurchase, in cash, all or any part (equal to
$2,000 or an integral multiple of $1,000 in excess thereof) of each Holder’s
Notes at a purchase price equal to 101% of the aggregate principal amount
thereof plus accrued and unpaid interest thereon, if any, to the date of
purchase ( the “Change of Control Payment”). 
Within 30 days following any Change of Control, the Issuers will mail a
notice to each Holder setting forth the procedures governing the Change of
Control Offer as required by the Indenture.

 

(b) 
If the Partnership or any of its Restricted Subsidiary consummates any Asset
Sales, within 15 days of each date on which the aggregate amount of Excess
Proceeds exceeds $20 million, the Issuers will commence an offer to all Holders
of Notes and all holders of other Indebtedness that are pari passu with the Notes containing
provisions similar to those set forth in this Indenture with respect to offers
to purchase or redeem with the proceeds of sales of assets (an “Asset Sale
Offer”) pursuant to Section 3.09 of the Indenture to purchase the maximum
principal amount of Notes and other pari
passu Indebtedness that may be purchased out of the Excess Proceeds
at an offer price in cash in an amount equal to 100% of the principal amount
thereof plus accrued and unpaid interest thereon, if any, to the date fixed for
the closing of such offer, in accordance with the procedures set forth in the
Indenture.  To the extent that the
aggregate amount of Notes and other pari
passu Indebtedness tendered pursuant to an Asset Sale Offer is less
than the Excess Proceeds, the Partnership or any Restricted Subsidiary may use
such deficiency for general business purposes. 
If the aggregate principal amount of Notes and other pari passu Indebtedness surrendered by
holders thereof exceeds the amount of Excess Proceeds, the Trustee shall select
the Notes and other pari passu
Indebtedness to be purchased on a pro rata
basis.  Holders of Notes that are the
subject of an offer to purchase will receive an Asset Sale Offer from the
Issuers prior to any related purchase 

 

A2-5

 

date and may elect to have
such Notes purchased by completing the form entitled “Option of Holder to Elect
Purchase” on the reverse of the Notes.

 

(3)           NOTICE
OF REDEMPTION.  Notice of
redemption will be mailed at least 10 days but not more than 60 days before the
redemption date to each Holder whose Notes are to be redeemed at its registered
address.  Notes in denominations larger
than $2,000 may be redeemed in part but only in whole multiples of $1,000,
unless all of the Notes held by a Holder are to be redeemed.  On and after the redemption date interest
ceases to accrue on Notes or portions thereof called for redemption.

 

(4)           DENOMINATIONS,
TRANSFER, EXCHANGE.  The Notes
are in registered form without coupons in denominations of $2,000 and integral
multiples of $1,000 in excess thereof. 
The transfer of Notes may be registered and Notes may be exchanged as
provided in the Indenture.  The Registrar
and the Trustee may require a Holder, among other things, to furnish appropriate
endorsements and transfer documents and the Issuers may require a Holder to pay
any taxes and fees required by law or permitted by the Indenture.  The Issuers need not exchange or register the
transfer of any Note or portion of a Note selected for redemption, except for
the unredeemed portion of any Note being redeemed in part.  Also, the Issuers need not exchange or
register the transfer of any Notes for a period of 15 days before a selection
of Notes to be redeemed or during the period between a record date and the
corresponding Interest Payment Date.

 

(5)           PERSONS
DEEMED OWNERS.  The registered
Holder of a Note may be treated as its owner for all purposes.

 

(6)           AMENDMENT,
SUPPLEMENT AND WAIVER. 
Subject to certain exceptions, the Indenture or the Notes may be amended
or supplemented with the consent of the Holders of at least a majority in
principal amount of the then outstanding Notes (including, consents obtained in
connection with a tender offer or exchange offer for Notes), and any existing default
or compliance with any provision of the Indenture or the Notes may be waived
with the consent of the Holders of a majority in aggregate principal amount of
the then outstanding Notes (including, consents obtained in connection with a
tender offer or exchange offer for Notes). 
Without the consent of any Holder of a Note, the Indenture or the Notes
may be amended or supplemented to cure any ambiguity, defect or inconsistency,
to provide for uncertificated Notes in addition to or in place of certificated
Notes, to provide for the assumption of the Issuers’ obligations to Holders of
the Notes in case of a merger or consolidation, to make any change that could
provide any additional rights or benefits to the Holders of the Notes that does
not adversely affect the legal rights under the Indenture of any such Holder,
to comply with the requirements of the SEC in order to effect or maintain the
qualification of the Indenture under the Trust Indenture Act, or to provide for
security for or add guarantees with respect to the Notes.

 

(7)           DEFAULTS
AND REMEDIES.  Events of
Default include:  Each of the following
is an “Event of Default”: (i) default in the payment of the principal of
or premium, if any, on any Note when the same becomes due and payable, upon
stated maturity, acceleration, optional redemption, required purchase,
scheduled principal payment or otherwise; (ii) default in the payment of
an installment of interest on any of 

 

A2-6

 

the Notes, when the same becomes
due and payable, which default continues for a period of 30 days; (iii) failure
of the Issuers to perform or observe any other term, covenant or agreement
contained in the Notes or the Indenture, other than a default specified in
either (i) or (ii) above, and the default continues for a period of
45 days after written notice of the default requiring the Issuers to remedy the
same has been given to the Partnership by the Trustee or to the Issuers and the
Trustee by Holders of at least 25% in aggregate principal amount of the Notes
then outstanding; (iv) default or defaults under certain other agreements,
instruments, mortgages, bonds, debentures or other evidences of Indebtedness
under which the Partnership or any Restricted Subsidiary of the Partnership has
outstanding Indebtedness in excess of $25 million if the default (x) is
caused by a failure to pay principal of or premium, if any, or interest on to
such Indebtedness within the applicable grace period, if any, provided with
respect to such Indebtedness or (y) results in the acceleration of such
Indebtedness prior to its stated maturity; (v) certain final judgment or
judgments, which is or are non-appealable and non-reviewable or which has or
have not been stayed pending appeal or review or as to which all rights to
appeal or review have expired or been exhausted, shall have been rendered
against the Partnership, any Restricted Subsidiary or the General Partner
provided such judgment or judgments requires or require the payment of money in
excess of $25 million in the aggregate and is not covered by insurance or
discharged or stayed pending appeal or review within 60 days after entry of
such judgment or in the event of a stay, within 30 days after the stay expires;
or (vi) specified events of bankruptcy, insolvency, or reorganization with
respect to the Issuers or any of their Significant Subsidiaries as more fully
set forth in the Indenture.  If any Event
of Default occurs and is continuing, the Trustee or the Holders of at least 25%
in principal amount of the applicable series of Notes then outstanding Notes
may declare all the Notes of that series to be due and payable.  Notwithstanding the foregoing, in the case of
an Event of Default arising from certain events of bankruptcy or insolvency,
with respect to the Partnership, Finance Corp. or any Significant Subsidiary,
all outstanding Notes will become due and payable without further action or
notice.  Holders may not enforce the
Indenture or the Notes except as provided in the Indenture.  Subject to certain limitations, Holders of a
majority in principal amount of a series of then outstanding Notes may direct
the Trustee of that series of Notes in its exercise of any trust or power. The
Trustee may withhold from Holders of the Notes notice of any continuing Default
or Event of Default (except a Default or Event of Default relating to the
payment of principal or interest) if it determines in good faith that
withholding notice is in their interest. 
The Holders of a majority in aggregate principal amount of a series of
Notes then outstanding by notice to the Trustee for those Notes may on behalf
of all Holders of Notes of that series waive any existing Default or Event of
Default and its consequences under the Indenture except a continuing Default or
Event of Default in the payment of interest on, or the principal of, the
Notes.  The Issuers are required to
deliver to the Trustee annually a statement regarding compliance with the
Indenture, and the Issuers are required upon becoming aware of any Default or Event
of Default, to deliver to the Trustee a statement specifying such Default or
Event of Default.

 

(8)           TRUSTEE
DEALINGS WITH ISSUERS.  The
Trustee, in its individual or any other capacity, may make loans to, accept
deposits from, and perform services for the 

 

A2-7

 

Issuers or their Affiliates,
and may otherwise deal with the Issuers or their Affiliates, as if it were not
the Trustee.

 

(9)           NO
RECOURSE AGAINST OTHERS.  A
limited partner of the Partnership or director, officer, employee, incorporator
or stockholder of the General Partner or Finance Corp., as such, will not have
any liability for any obligations of the Issuers under the Notes or the
Indenture or for any claim based on, in respect of, or by reason of, such
obligations.  Each Holder by accepting a
Note waives and releases all such liability. 
The waiver and release are part of the consideration for the issuance of
the Notes.

 

(10)         AUTHENTICATION.  This Note will not be valid until
authenticated by the manual signature of the Trustee or an authenticating
agent.

 

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

 

(12)         ADDITIONAL
RIGHTS OF HOLDERS OF RESTRICTED GLOBAL NOTES AND RESTRICTED DEFINITIVE NOTES.  In addition to the rights provided to Holders
of Notes under the Indenture, Holders of Restricted Global Notes and Restricted
Definitive Notes will have all the rights set forth in the Registration Rights
Agreement dated as of September 14, 2009, among the Issuers and the other
parties named on the signature pages thereof or, in the case of Additional
Notes, Holders of Restricted Global Notes and Restricted Definitive Notes will
have the rights set forth in one or more registration rights agreements, if
any, among the Issuers and the other parties thereto, relating to rights given
by the Issuers to the purchasers of any Additional Notes (collectively, the “Registration
Rights Agreement”).

 

(13)         CUSIP
NUMBERS.  Pursuant to a
recommendation promulgated by the Committee on Uniform Security Identification
Procedures, the Issuers have caused CUSIP numbers to be printed on the Notes
and the Trustee may use CUSIP numbers in notices of redemption as a convenience
to Holders.  No representation is made as
to the accuracy of such numbers either as printed on the Notes or as contained
in any notice of redemption and reliance may be placed only on the other
identification numbers placed thereon.

 

(14)         GOVERNING LAW.  THE INTERNAL LAW OF THE STATE OF NEW YORK
WILL GOVERN AND BE USED TO CONSTRUE THE INDENTURE AND THIS NOTE  WITHOUT GIVING EFFECT TO APPLICABLE
PRINCIPLES OF CONFLICTS OF LAW TO THE EXTENT THAT THE APPLICATION OF THE LAWS
OF ANOTHER JURISDICTION WOULD BE REQUIRED THEREBY.

 

The Issuers will furnish to
any Holder upon written request and without charge a copy of the
Indenture.  Requests may be made to:

 

Ferrellgas, L.P.

7500 College Boulevard

 

A2-8

 

Suite 1000

Overland Park, Kansas  66210

Attention:  Investor Relations

(913) 661-1537

 

A2-9

 

ASSIGNMENT FORM

 

To assign this Note, fill in
the form below:

 

	
  (I) or
  (we) assign and transfer this Note to:

  	
   

  

(Insert assignee’s legal name)

 

	
   

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

  

 

	
   

  
	
   

  
	
   

  
	
   

  

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

 

and
irrevocably appoint

to
transfer this Note on the books of the Issuers. 
The agent may substitute another to act for him.

 

	
  Date:

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  Your Signature:

  	
   

  
	
   

  	
   

  	
  (Sign exactly as your name appears on the face of this Note)

  

 

	
  Signature Guarantee*:

  	
   

  	
   

  

 

*                              Participant
in a recognized Signature Guarantee Medallion Program (or other signature
guarantor acceptable to the Trustee).

 

A2-10

 

OPTION OF HOLDER TO ELECT PURCHASE

 

If you want to elect to have
this Note purchased by the Issuers pursuant to Section 4.10 or 4.14 of the
Indenture, check the appropriate box below:

 

	
  o
  Section 4.10

  	
  o
  Section 4.14

  

 

If you want to elect to have
only part of the Note purchased by the Issuers pursuant to Section 4.10 or
Section 4.14 of the Indenture, state the amount you elect to have
purchased:

 

$             

 

	
  Date:

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  Your Signature:

  	
   

  
	
   

  	
   

  	
  (Sign exactly as your name appears on the face of this Note)

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  Tax Identification No.:

  	
   

  
						

 

	
  Signature Guarantee*:

  	
   

  	
   

  

 

*              Participant in a
recognized Signature Guarantee Medallion Program (or other signature guarantor
acceptable to the Trustee).

 

A2-11

 

SCHEDULE OF EXCHANGES OF INTERESTS IN THE REGULATION
S TEMPORARY GLOBAL NOTE

 

The following exchanges of a
part of this Regulation S Temporary Global Note for an interest in another
Global Note, or exchanges of a part of another other Restricted Global Note for
an interest in this Regulation S Temporary Global Note, have been made:

 

	
  Date of Exchange

  	
   

  	
  Amount
  of decrease in

  Principal Amount 

  of 

  this Global Note

  	
   

  	
  Amount
  of increase in

  Principal Amount 

  of 

  this Global Note

  	
   

  	
  Principal
  Amount 

  of this Global Note

  following such decrease 

  (or increase)

  	
   

  	
  Signature
  of authorized

  signatory of Trustee or

  Custodian

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  

 

A2-12

 

EXHIBIT B

 

FORM OF CERTIFICATE OF TRANSFER

 

Ferrellgas, L.P.

7500
College Boulevard

Suite 1000

Overland
Park, Kansas  66210

Attention:  Investor Relations

 

U.S. Bank National Association 

Corporate Trust Services

100
Wall Street, Suite 1600

New
York, NY  10005

 

Re:  9.125% Senior Notes due 2017

 

Reference is hereby made to
the Indenture, dated as of September 14, 2009 (the “Indenture”), among Ferrellgas, L.P. and
Ferrellgas Finance Corp. (together, the “Issuers”),
as Issuers, and U.S. Bank National Association, as trustee.  Capitalized terms used but not defined herein
shall have the meanings given to them in the Indenture.

 

,
(the “Transferor”) owns and
proposes to transfer the Note[s] or interest in such Note[s] specified in Annex
A hereto, in the principal amount of $                      
in such Note[s] or interests (the “Transfer”),
to                                                       
(the “Transferee”), as further
specified in Annex A hereto.  In
connection with the Transfer, the Transferor hereby certifies that:

 

[CHECK ALL THAT APPLY]

 

1.  o   Check
if Transferee will take delivery of a beneficial interest in the 144A Global
Note or a Restricted Definitive Note pursuant to Rule 144A.  The Transfer is being effected pursuant to
and in accordance with Rule 144A under the Securities Act of 1933, as
amended (the “Securities Act”),
and, accordingly, the Transferor hereby further certifies that the beneficial
interest or Definitive Note is being transferred to a Person that the
Transferor reasonably believes is purchasing the beneficial interest or
Definitive Note for its own account, or for one or more accounts with respect
to which such Person exercises sole investment discretion, and such Person and
each such account is a “qualified institutional buyer” within the meaning of Rule 144A
in a transaction meeting the requirements of Rule 144A, and such Transfer
is in compliance with any applicable blue sky securities laws of any state of
the United States.  Upon consummation of
the proposed Transfer in accordance with the terms of the Indenture, the
transferred beneficial interest or Definitive Note will be subject to the
restrictions on transfer enumerated in the Private Placement Legend printed on
the 144A Global Note and/or the Restricted Definitive Note and in the Indenture
and the Securities Act.

 

2.  o   Check
if Transferee will take delivery of a beneficial interest in the Regulation S
Temporary Global Note, the Regulation S Permanent Global Note or a Restricted
Definitive Note pursuant to Regulation S.  The Transfer is being effected pursuant

 

B-1

 

to
and in accordance with Rule 903 or Rule 904 under the Securities Act
and, accordingly, the Transferor hereby further certifies that (i) the
Transfer is not being made to a Person in the United States and (x) at the
time the buy order was originated, the Transferee was outside the United States
or such Transferor and any Person acting on its behalf reasonably believed and
believes that the Transferee was outside the United States or (y) the
transaction was executed in, on or through the facilities of a designated
offshore securities market and neither such Transferor nor any Person acting on
its behalf knows that the transaction was prearranged with a buyer in the
United States, (ii) no directed selling efforts have been made in
contravention of the requirements of Rule 903(b) or Rule 904(b) of
Regulation S under the Securities Act, (iii) the transaction is not part
of a plan or scheme to evade the registration requirements of the Securities
Act and (iv) if the proposed transfer is being made prior to the
expiration of the Restricted Period, the transfer is not being made to a U.S.
Person or for the account or benefit of a U.S. Person (other than an Initial
Purchaser).  Upon consummation of the
proposed transfer in accordance with the terms of the Indenture, the transferred
beneficial interest or Definitive Note will be subject to the restrictions on
Transfer enumerated in the Private Placement Legend printed on the Regulation S
Permanent Global Note, the Regulation S Temporary Global Note and/or the
Restricted Definitive Note and in the Indenture and the Securities Act.

 

3.  o   Check
and complete if Transferee will take delivery of a beneficial interest in the
IAI Global Note or a Restricted Definitive Note pursuant to any provision of
the Securities Act other than Rule 144A or Regulation S.  The Transfer is being effected in compliance
with the transfer restrictions applicable to beneficial interests in Restricted
Global Notes and Restricted Definitive Notes and pursuant to and in accordance
with the Securities Act and any applicable blue sky securities laws of any
state of the United States, and accordingly the Transferor hereby further
certifies that (check one):

 

(a)           o   such Transfer is being effected pursuant to
and in accordance with Rule 144 under the Securities Act;

 

or

 

(b)           o   such Transfer is being effected to the
Issuers or a subsidiary thereof;

 

or

 

(c)           o   such Transfer is being effected pursuant to
an effective registration statement under the Securities Act and in compliance
with the prospectus delivery requirements of the Securities Act;

 

or

 

(d)           o   such Transfer is being effected to an
Institutional Accredited Investor and pursuant to an exemption from the
registration requirements of the Securities Act other than Rule 144A, Rule 144,
Rule 903 or Rule 904, and the Transferor hereby further certifies
that it has not engaged in any general solicitation within the meaning of
Regulation D under the Securities Act and the Transfer complies with the
transfer restrictions applicable to beneficial interests in a Restricted Global
Note or Restricted Definitive Notes and the requirements of the exemption
claimed, which certification is 

 

B-2

 

supported by (1) a certificate executed
by the Transferee in the form of Exhibit D to the Indenture and (2) if
such Transfer is in respect of a principal amount of Notes at the time of
transfer of less than $250,000, an Opinion of Counsel provided by the
Transferor or the Transferee (a copy of which the Transferor has attached to
this certification), to the effect that such Transfer is in compliance with the
Securities Act.  Upon consummation of the
proposed transfer in accordance with the terms of the Indenture, the
transferred beneficial interest or Definitive Note will be subject to the
restrictions on transfer enumerated in the Private Placement Legend printed on
the IAI Global Note and/or the Restricted Definitive Notes and in the Indenture
and the Securities Act.

 

4.  o   Check
if Transferee will take delivery of a beneficial interest in an Unrestricted
Global Note or of an Unrestricted Definitive Note.

 

(a)  o   Check if
Transfer is pursuant to Rule 144.  (i) The Transfer is being effected
pursuant to and in accordance with Rule 144 under the Securities Act and
in compliance with the transfer restrictions contained in the Indenture and any
applicable blue sky securities laws of any state of the United States and (ii) the
restrictions on transfer contained in the Indenture and the Private Placement
Legend are not required in order to maintain compliance with the Securities
Act.  Upon consummation of the proposed
Transfer in accordance with the terms of the Indenture, the transferred
beneficial interest or Definitive Note will no longer be subject to the
restrictions on transfer enumerated in the Private Placement Legend printed on
the Restricted Global Notes, on Restricted Definitive Notes and in the
Indenture.

 

(b)  o   Check if
Transfer is Pursuant to Regulation S.  (i) The Transfer is being effected
pursuant to and in accordance with Rule 903 or Rule 904 under the
Securities Act and in compliance with the transfer restrictions contained in
the Indenture and any applicable blue sky securities laws of any state of the
United States and (ii) the restrictions on transfer contained in the
Indenture and the Private Placement Legend are not required in order to
maintain compliance with the Securities Act. 
Upon consummation of the proposed Transfer in accordance with the terms
of the Indenture, the transferred beneficial interest or Definitive Note will
no longer be subject to the restrictions on transfer enumerated in the Private
Placement Legend printed on the Restricted Global Notes, on Restricted
Definitive Notes and in the Indenture.

 

(c)  o   Check if
Transfer is Pursuant to Other Exemption.  (i) The Transfer is being effected
pursuant to and in compliance with an exemption from the registration
requirements of the Securities Act other than Rule 144, Rule 903 or Rule 904
and in compliance with the transfer restrictions contained in the Indenture and
any applicable blue sky securities laws of any State of the United States and (ii) the
restrictions on transfer contained in the Indenture and the Private Placement
Legend are not required in order to maintain compliance with the Securities
Act.  Upon consummation of the proposed
Transfer in accordance with the terms of the Indenture, the transferred
beneficial interest or Definitive Note will not be subject to the restrictions
on transfer enumerated in the Private Placement Legend printed on the
Restricted Global Notes or Restricted Definitive Notes and in the Indenture.

 

This certificate and the
statements contained herein are made for your benefit and the benefit of the
Issuers.

 

B-3

 

	
   

  	
   

  	
   

  
	
   

  	
   

  	
  [Insert
  Name of Transferor]

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  By:

  	
   

  
	
   

  	
   

  	
   

  	
  Name:

  
	
   

  	
   

  	
   

  	
  Title:

  
	
   

  	
   

  	
   

  
	
  Dated:

  	
   

  	
   

  	
   

  
					

 

B-4

 

ANNEX A TO CERTIFICATE OF TRANSFER

 

1.             The Transferor owns and proposes to transfer the
following:

 

[CHECK ONE OF (a) OR (b)]

 

o   a beneficial interest in the:

 

(i)          o   144A Global Note (CUSIP                                            ),
or

 

(ii)         o   Regulation S Global Note (CUSIP                              ), or

 

(iii)        o    IAI Global Note (CUSIP                   );
or

 

(b) 
o    a Restricted Definitive Note.

 

2.             After the Transfer the Transferee will hold:

 

[CHECK ONE]

 

(a) 
o   a beneficial interest in the:

 

(i)          o   144A Global Note (CUSIP                   ), or

 

(ii)         o   Regulation S Global Note (CUSIP                   ), or

 

(iii)        o   IAI Global Note (CUSIP                   );
or

 

(iv)        o   Unrestricted Global Note (CUSIP                   );
or

 

(b) 
o   a Restricted Definitive Note; or

 

(c) 
o   an Unrestricted Definitive Note,

 

in
accordance with the terms of the Indenture.

 

B-5

 

EXHIBIT C

 

FORM OF CERTIFICATE OF EXCHANGE

 

Ferrellgas, L.P.

7500
College Boulevard

Suite 1000

Overland
Park, Kansas  66210

Attention:  Investor Relations

 

U.S. Bank National Association 

Corporate Trust Services

100
Wall Street, Suite 1600

New
York, NY  10005

 

Re:  9.125% Senior Notes due 2017

 

Reference is hereby made to
the Indenture, dated as of September 14, 2009 (the “Indenture”), among Ferrellgas, L.P. and
Ferrellgas Finance Corp. (together, the “Issuers”),
as Issuers, and U.S. Bank National Association, as trustee.  Capitalized terms used but not defined herein
shall have the meanings given to them in the Indenture.

 

,
(the “Owner”) owns and proposes
to exchange the Note[s] or interest in such Note[s] specified herein, in the
principal amount of $                        
in such Note[s] or interests (the “Exchange”).  In connection with the Exchange, the Owner
hereby certifies that:

 

1.             Exchange of
Restricted Definitive Notes or Beneficial Interests in a Restricted Global Note
for Unrestricted Definitive Notes or Beneficial Interests in an Unrestricted
Global Note

 

(a)  o     Check if
Exchange is from beneficial interest in a Restricted Global Note to beneficial
interest in an Unrestricted Global Note.  In connection with the Exchange of the Owner’s
beneficial interest in a Restricted Global Note for a beneficial interest in an
Unrestricted Global Note in an equal principal amount, the Owner hereby
certifies (i) the beneficial interest is being acquired for the Owner’s
own account without transfer, (ii) such Exchange has been effected in
compliance with the transfer restrictions applicable to the Global Notes and
pursuant to and in accordance with the Securities Act of 1933, as amended (the “Securities Act”), (iii) the
restrictions on transfer contained in the Indenture and the Private Placement
Legend are not required in order to maintain compliance with the Securities Act
and (iv) the beneficial interest in an Unrestricted Global Note is being
acquired in compliance with any applicable blue sky securities laws of any
state of the United States.

 

(b)  o     Check if
Exchange is from beneficial interest in a Restricted Global Note to
Unrestricted Definitive Note. 
In connection with the Exchange of the Owner’s beneficial interest in a
Restricted Global Note for an Unrestricted Definitive Note, the Owner hereby

 

C-1

 

certifies (i) the Definitive Note is
being acquired for the Owner’s own account without transfer, (ii) such
Exchange has been effected in compliance with the transfer restrictions
applicable to the Restricted Global Notes and pursuant to and in accordance
with the Securities Act, (iii) the restrictions on transfer contained in
the Indenture and the Private Placement Legend are not required in order to
maintain compliance with the Securities Act and (iv) the Definitive Note
is being acquired in compliance with any applicable blue sky securities laws of
any state of the United States.

 

(c)  o     Check if
Exchange is from Restricted Definitive Note to beneficial interest in an
Unrestricted Global Note.  In
connection with the Owner’s Exchange of a Restricted Definitive Note for a
beneficial interest in an Unrestricted Global Note, the Owner hereby certifies (i) the
beneficial interest is being acquired for the Owner’s own account without
transfer, (ii) such Exchange has been effected in compliance with the
transfer restrictions applicable to Restricted Definitive Notes and pursuant to
and in accordance with the Securities Act, (iii) the restrictions on
transfer contained in the Indenture and the Private Placement Legend are not
required in order to maintain compliance with the Securities Act and (iv) the
beneficial interest is being acquired in compliance with any applicable blue
sky securities laws of any state of the United States.

 

(d)  o     Check if
Exchange is from Restricted Definitive Note to Unrestricted Definitive Note.  In connection with the Owner’s Exchange of a
Restricted Definitive Note for an Unrestricted Definitive Note, the Owner
hereby certifies (i) the Unrestricted Definitive Note is being acquired
for the Owner’s own account without transfer, (ii) such Exchange has been
effected in compliance with the transfer restrictions applicable to Restricted
Definitive Notes and pursuant to and in accordance with the Securities Act, (iii) the
restrictions on transfer contained in the Indenture and the Private Placement
Legend are not required in order to maintain compliance with the Securities Act
and (iv) the Unrestricted Definitive Note is being acquired in compliance
with any applicable blue sky securities laws of any state of the United States.

 

2.             Exchange of
Restricted Definitive Notes or Beneficial Interests in Restricted Global Notes
for Restricted Definitive Notes or Beneficial Interests in Restricted Global
Notes

 

(a)  o     Check if
Exchange is from beneficial interest in a Restricted Global Note to Restricted
Definitive Note.  In
connection with the Exchange of the Owner’s beneficial interest in a Restricted
Global Note for a Restricted Definitive Note with an equal principal amount,
the Owner hereby certifies that the Restricted Definitive Note is being
acquired for the Owner’s own account without transfer.  Upon consummation of the proposed Exchange in
accordance with the terms of the Indenture, the Restricted Definitive Note
issued will continue to be subject to the restrictions on transfer enumerated
in the Private Placement Legend printed on the Restricted Definitive Note and
in the Indenture and the Securities Act.

 

(b)  o     Check if
Exchange is from Restricted Definitive Note to beneficial interest in a
Restricted Global Note.  In
connection with the Exchange of the Owner’s Restricted Definitive Note for a
beneficial interest in the [CHECK ONE] o 144A Global
Note, o Regulation S
Global Note,  o IAI Global
Note with an equal principal amount, the Owner hereby certifies (i) the
beneficial interest is being acquired for the Owner’s own account without 

 

C-2

 

transfer and (ii) such Exchange has been
effected in compliance with the transfer restrictions applicable to the
Restricted Global Notes and pursuant to and in accordance with the Securities
Act, and in compliance with any applicable blue sky securities laws of any
state of the United States.  Upon
consummation of the proposed Exchange in accordance with the terms of the
Indenture, the beneficial interest issued will be subject to the restrictions
on transfer enumerated in the Private Placement Legend printed on the relevant
Restricted Global Note and in the Indenture and the Securities Act.

 

This certificate and the
statements contained herein are made for your benefit and the benefit of the
Issuers.

 

	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
  [Insert Name of Transferor]

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  By:

  	
   

  
	
   

  	
   

  	
   

  	
  Name:

  
	
   

  	
   

  	
   

  	
  Title:

  
	
   

  	
   

  	
   

  
	
  Dated:

  	
   

  	
   

  	
   

  
					

 

C-3

 

EXHIBIT D

 

FORM OF CERTIFICATE FROM

ACQUIRING INSTITUTIONAL ACCREDITED INVESTOR

 

Ferrellgas, L.P.

7500
College Boulevard

Suite 1000

Overland
Park, Kansas  66210

Attention:  Investor Relations

 

U.S. Bank National Association 

Corporate Trust Services

100
Wall Street, Suite 1600

New
York, NY  10005

 

Re:  9.125% Senior Notes due 2017

 

Reference is hereby made to
the Indenture, dated as of September 14, 2009 (the “Indenture”), among Ferrellgas, L.P. and
Ferrellgas Finance Corp. (together, the “Issuers”),
as Issuers, and U.S. Bank National Association, as trustee.  Capitalized terms used but not defined herein
shall have the meanings given to them in the Indenture.

 

In connection with our
proposed purchase of $                        
aggregate principal amount of:

 

(a)  o     a beneficial interest in a Global Note, or

 

(b)  o     a Definitive Note,we confirm that:

 

1.             We understand that any subsequent transfer of the Notes
or any interest therein is subject to certain restrictions and conditions set
forth in the Indenture and the undersigned agrees to be bound by, and not to
resell, pledge or otherwise transfer the Notes or any interest therein except
in compliance with, such restrictions and conditions and the Securities Act of
1933, as amended (the “Securities Act”).

 

2.             We understand that the offer and sale of the Notes have
not been registered under the Securities Act, and that the Notes and any
interest therein may not be offered or sold except as permitted in the
following sentence.  We agree, on our own
behalf and on behalf of any accounts for which we are acting as hereinafter
stated, that if we should sell the Notes or any interest therein, we will do so
only (A) to the Issuers or any subsidiary thereof, (B) in accordance
with Rule 144A under the Securities Act to a “qualified institutional
buyer” (as defined therein), (C) to an institutional “accredited investor”
(as defined below) that, prior to such transfer, furnishes (or has furnished on
its behalf by a U.S. broker-dealer) to you and to the Issuers a 

 

D-1

 

signed letter substantially in the form of
this letter and, if such transfer is in respect of a principal amount of Notes,
at the time of transfer of less than $250,000, an Opinion of Counsel in form reasonably
acceptable to the Issuers to the effect that such transfer is in compliance
with the Securities Act, (D) outside the United States in accordance with Rule 904
of Regulation S under the Securities Act, (E) pursuant to the provisions
of Rule 144(k) under the Securities Act or (F) pursuant to an
effective registration statement under the Securities Act, and we further agree
to provide to any Person purchasing the Definitive Note or beneficial interest
in a Global Note from us in a transaction meeting the requirements of clauses (A) through
(E) of this paragraph a notice advising such purchaser that resales
thereof are restricted as stated herein.

 

3.             We understand that, on any proposed resale of the Notes
or beneficial interest therein, we will be required to furnish to you and the
Issuers such certifications, legal opinions and other information as you and
the Issuers may reasonably require to confirm that the proposed sale complies
with the foregoing restrictions.  We
further understand that the Notes purchased by us will bear a legend to the
foregoing effect.

 

4.             We are an institutional “accredited investor” (as
defined in Rule 501(a)(1), (2), (3) or (7) of Regulation D under
the Securities Act) and have such knowledge and experience in financial and
business matters as to be capable of evaluating the merits and risks of our
investment in the Notes, and we and any accounts for which we are acting are
each able to bear the economic risk of our or its investment.

 

5.             We are acquiring the Notes or beneficial interest therein
purchased by us for our own account or for one or more accounts (each of which
is an institutional “accredited investor”) as to each of which we exercise sole
investment discretion.

 

You and the Issuers are
entitled to rely upon this letter and are irrevocably authorized to produce
this letter or a copy hereof to any interested party in any administrative or
legal proceedings or official inquiry with respect to the matters covered
hereby.

 

	
   

  	
   

  	
   

  
	
   

  	
   

  	
  [Insert
  Name of Accredited Investor]

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  By:

  	
   

  
	
   

  	
   

  	
   

  	
  Name:

  
	
   

  	
   

  	
   

  	
  Title:

  
	
   

  	
   

  	
   

  
	
  Dated:

  	
   

  	
   

  	
   

  
					

 

D-2

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