Document:

Spartan Stores Exhibit 10.1 to Form 8-K - 05/30/08

EXHIBIT 10.1

ASSET PURCHASE AGREEMENT

between

RITE AID OF OHIO, INC.

and

SEAWAY FOOD TOWN, INC.

Dated as of: March 31, 2008

TABLE OF CONTENTS

	
 
	
 
	
Page

	
ARTICLE I
	
SALE AND PURCHASE OF ASSETS
	
1

	
 
	
Section 1.01
	
Assets to be Acquired
	
1

	
 
	
 
	
 
	
 

	
 
	
Section 1.02
	
Excluded Assets
	
4

	
 
	
 
	
 
	
 

	
 
	
Section 1.03
	
Assumed Obligations
	
5

	
 
	
 
	
 
	
 

	
 
	
Section 1.04
	
Nonassumption of Liabilities
	
5

	
ARTICLE II
	
PURCHASE PRICE, METHOD OF PAYMENT; INVENTORY
	
6

	
 
	
Section 2.01
	
Purchase Price
	
6

	
 
	
 
	
 
	
 

	
 
	
Section 2.02
	
Prorations
	
7

	
 
	
 
	
 
	
 

	
 
	
Section 2.03
	
Utilities
	
8

	
 
	
 
	
 
	
 

	
 
	
Section 2.04
	
Purchase Price Allocation
	
8

	
 
	
 
	
 
	
 

	
 
	
Section 2.05
	
Estoppels
	
8

	
ARTICLE III
	
CLOSING, DOCUMENTS OF CONVEYANCE
	
9

	
 
	
Section 3.01
	
Closing
	
9

	
 
	
 
	
 
	
 

	
 
	
Section 3.02
	
Assignment and Assumption Agreements; New Leases
	
9

	
 
	
 
	
 
	
 

	
 
	
Section 3.03
	
Other Instruments of Conveyance
	
10

	
 
	
 
	
 
	
 

	
 
	
Section 3.04
	
Other Deliveries at  Closing
	
10

	
 
	
 
	
 
	
 

	
 
	
Section 3.05
	
Allocation of Closing Costs
	
11

	
 
	
 
	
 
	
 

	
 
	
Section 3.06
	
Other Obligations
	
11

	
 
	
 
	
 
	
 

	
 
	
Section 3.07
	
Transfer of Possession
	
11

	
 
	
 
	
 
	
 

	
 
	
Section 3.08
	
Termination and Related Employee Matters
	
11

	
 
	
 
	
 
	
 

	
 
	
Section 3.09
	
Utility Services
	
12

	
 
	
 
	
 
	
 

	
 
	
Section 3.10
	
Other Actions and Instruments
	
12

	
ARTICLE IV
	
REPRESENTATIONS AND WARRANTIES OF BUYER
	
12

	
 
	
Section 4.01
	
Organization and Good Standing
	
12

	
 
	
 
	
 
	
 

	
 
	
Section 4.02
	
Corporate Power and Authority
	
12

	
 
	
 
	
 
	
 

	
 
	
Section 4.03
	
Validity of Contemplated Transactions
	
12

	
 
	
 
	
 
	
 

	
 
	
Section 4.04
	
Regulatory Approvals
	
13

	
 
	
 
	
 
	
 

	
 
	
Section 4.05
	
Inventory Held for Resale
	
13

	
 
	
 
	
 
	
 

	
 
	
Section 4.06
	
Brokers
	
13

	
 
	
 
	
 
	
 

	
 
	
Section 4.07
	
Buyer's Knowledge
	
13

	
ARTICLE V
	
REPRESENTATIONS AND WARRANTIES OF SELLER
	
13

	
 
	
Section 5.01
	
Organization, Good Standing and Qualification
	
13

	
 
	
Section 5.02
	
Corporate Power and Authority
	
13

	
 
	
 
	
 
	
 

	
 
	
Section 5.03
	
Validity of Contemplated Transactions
	
14

	
 
	
 
	
 
	
 

	
 
	
Section 5.04
	
Regulatory Approvals
	
14

	
 
	
 
	
 
	
 

	
 
	
Section 5.05
	
Liabilities and Obligations of Seller
	
14

	
 
	
 
	
 
	
 

	
 
	
Section 5.06
	
Title to Purchased Assets
	
14

	
 
	
 
	
 
	
 

	
 
	
Section 5.07
	
Assumed Leases
	
14

	
 
	
 
	
 
	
 

	
 
	
Section 5.08
	
Taxes
	
15

	
 
	
 
	
 
	
 

	
 
	
Section 5.09
	
Zoning; Easements
	
15

	
 
	
 
	
 
	
 

	
 
	
Section 5.10
	
Litigation, Compliance with Laws
	
15

	
 
	
 
	
 
	
 

	
 
	
Section 5.11
	
Permits and Licenses
	
16

	
 
	
 
	
 
	
 

	
 
	
Section 5.12
	
All Necessary Assets
	
16

	
 
	
 
	
 
	
 

	
 
	
Section 5.13
	
Employee Matters; Labor or Employee Disputes
	
16

	
 
	
 
	
 
	
 

	
 
	
Section 5.14
	
Insurance Coverages
	
16

	
 
	
 
	
 
	
 

	
 
	
Section 5.15
	
Environmental Matters
	
17

	
 
	
 
	
 
	
 

	
 
	
Section 5.16
	
Third Party Payors
	
17

	
 
	
 
	
 
	
 

	
 
	
Section 5.17
	
Financial Statements
	
17

	
 
	
 
	
 
	
 

	
 
	
Section 5.18
	
Prescriptions
	
17

	
 
	
 
	
 
	
 

	
 
	
Section 5.19
	
Fixed Assets
	
18

	
 
	
 
	
 
	
 

	
 
	
Section 5.20
	
Employee Benefits; ERISA
	
18

	
 
	
 
	
 
	
 

	
 
	
Section 5.21
	
Brokers
	
18

	
 
	
 
	
 
	
 

	
 
	
Section 5.22
	
AS IS, WHERE IS
	
19

	
ARTICLE VI
	
ACTIVITIES PRIOR TO THE EFFECTIVE TIME
	
19

	
 
	
Section 6.01
	
Activities Prior to Effective Time for Each Store
	
19

	
 
	
 
	
 
	
 

	
 
	
Section 6.02
	
Access; Confidentiality Agreement
	
20

	
 
	
 
	
 
	
 

	
 
	
Section 6.03
	
Seller's Employees
	
21

	
 
	
 
	
 
	
 

	
 
	
Section 6.04
	
Public Announcements
	
21

	
 
	
 
	
 
	
 

	
 
	
Section 6.05
	
Record Data; Patient Notification
	
21

	
 
	
 
	
 
	
 

	
 
	
Section 6.06
	
Matters Related to Prescriptions
	
22

	
 
	
 
	
 
	
 

	
 
	
Section 6.07
	
Compliance with Law
	
22

	
 
	
 
	
 
	
 

	
 
	
Section 6.08
	
Restrictive Covenants
	
22

	
 
	
 
	
 
	
 

	
 
	
Section 6.09
	
Landlords
	
22

	
 
	
 
	
 
	
 

	
 
	
Section 6.10
	
Prescription Count
	
23

	
 
	
 
	
 
	
 

	
 
	
Section 6.11
	
Wiring and Equipment Installation
	
23

	
ARTICLE VII
	
DUE DILIGENCE; CONDEMNATION; CASUALTY; CONSENTS;

ENVIRONMENTAL
	

24

	
 
	
Section 7.01
	
Premises Defects
	
24

	
 
	
 
	
 
	
 

	
 
	
Section 7.02
	
Lease Amendment
	
24

	
 
	
 
	
 
	
 

	
 
	
Section 7.03
	
Casualty
	
24

	
 
	
 
	
 
	
 

	
 
	
Section 7.04
	
Condemnation
	
26

	
 
	
 
	
 
	
 

	
 
	
Section 7.05
	
Landlord Consents and Two Mandated Lease Amendments
	
26

	
 
	
 
	
 
	
 

	
 
	
Section 7.06
	
Environmental
	
27

	
ARTICLE VIII
	
CONDITIONS TO OBLIGATIONS OF BUYER
	
27

	
 
	
Section 8.01
	
Representations and Warranties
	
27

	
 
	
 
	
 
	
 

	
 
	
Section 8.02
	
Performance of Covenants, Agreements and Obligations
	
28

	
 
	
 
	
 
	
 

	
 
	
Section 8.03
	
Prohibitions
	
28

	
 
	
 
	
 
	
 

	
 
	
Section 8.04
	
Authority
	
28

	
ARTICLE IX
	
CONDITIONS TO OBLIGATIONS OF SELLER
	
28

	
 
	
Section 9.01
	
Representations and Warranties
	
28

	
 
	
 
	
 
	
 

	
 
	
Section 9.02
	
Performance of Covenants, Agreements and Obligations
	
28

	
 
	
 
	
 
	
 

	
 
	
Section 9.03
	
Prohibitions
	
29

	
 
	
 
	
 
	
 

	
 
	
Section 9.04
	
Authority
	
29

	
ARTICLE X
	
SURVIVAL OF REPRESENTATIONS AND WARRANTIES;

INDEMNIFICATION
	

29

	
 
	
Section 10.01
	
Survival of Warranties
	
29

	
 
	
 
	
 
	
 

	
 
	
Section 10.02
	
Indemnification by Seller
	
29

	
 
	
 
	
 
	
 

	
 
	
Section 10.03
	
Indemnification by Buyer
	
30

	
 
	
 
	
 
	
 

	
 
	
Section 10.04
	
Limitations of Indemnity
	
31

	
 
	
 
	
 
	
 

	
 
	
Section 10.05
	
Notice
	
31

	
 
	
 
	
 
	
 

	
 
	
Section

	
Third Party Claims
	
32

	
ARTICLE XI
	
CONDUCT OF THE PARTIES AFTER CLOSING
	
32

	
 
	
Section 11.01
	
Cooperation
	
32

	
 
	
 
	
 
	
 

	
 
	
Section 11.02
	
Access to Books and Records
	
32

	
 
	
 
	
 
	
 

	
 
	
Section 11.03
	
Licenses
	
33

	
 
	
 
	
 
	
 

	
 
	
Section 11.04
	
Access to Prescription Files
	
33

	
 
	
 
	
 
	
 

	
 
	
Section 11.05
	
Non-Competition; Non-Solicitation
	
33

	
 
	
 
	
 
	
 

	
 
	
Section 11.06
	
Signage
	
35

	
 
	
Section 11.07
	
Use of Pharmacy Systems
	
35

	
 
	
 
	
 
	
 

	
 
	
Section 11.08
	
Protected Health Information
	
36

	
 
	
 
	
 
	
 

	
 
	
Section 11.09
	
HIPAA Privacy Standards
	
36

	
 
	
 
	
 
	
 

	
 
	
Section 11.10
	
Confidential Information
	
36

	
 
	
 
	
 
	
 

	
 
	
Section 11.11
	
Further Assurances
	
36

	
 
	
 
	
 
	
 

	
 
	
Section 11.12
	
Remittance
	
36

	
 
	
 
	
 
	
 

	
 
	
Section 11.13
	
Taxes
	
37

	
 
	
 
	
 
	
 

	
 
	
Section 11.14
	
Collective Bargaining Matters
	
37

	
 
	
 
	
 
	
 

	
 
	
Section 11.15
	
License
	
37

	
ARTICLE XII
	
BROKERAGE; EXPENSES
	
37

	
 
	
Section 12.01
	
Brokerage
	
37

	
 
	
 
	
 
	
 

	
 
	
Section 12.02
	
Transactional Expenses
	
38

	
ARTICLE XIII
	
TERMINATION
	
38

	
 
	
Section 13.01
	
Termination by Mutual Consent
	
38

	
 
	
 
	
 
	
 

	
 
	
Section 13.02
	
Termination Attributable to Default
	
38

	
 
	
 
	
 
	
 

	
 
	
Section 13.03
	
Termination by Buyer
	
38

	
 
	
 
	
 
	
 

	
 
	
Section 13.04
	
Termination Date
	
38

	
 
	
 
	
 
	
 

	
 
	
Section 13.05
	
Impossibility
	
38

	
 
	
 
	
 
	
 

	
 
	
Section 13.06
	
Results of Termination
	
39

	
 
	
 
	
 
	
 

	
 
	
Section 13.07
	
No Termination after Kick-Off Date
	
39

	
ARTICLE XIV
	
MISCELLANEOUS
	
39

	
 
	
Section 14.01
	
Notices
	
39

	
 
	
 
	
 
	
 

	
 
	
Section 14.02
	
Assignability and Parties in Interest
	
40

	
 
	
 
	
 
	
 

	
 
	
Section 14.03
	
Governing Law
	
40

	
 
	
 
	
 
	
 

	
 
	
Section 14.04
	
Counterparts
	
40

	
 
	
 
	
 
	
 

	
 
	
Section 14.05
	
Waiver
	
41

	
 
	
 
	
 
	
 

	
 
	
Section 14.06
	
Publicity
	
41

	
 
	
 
	
 
	
 

	
 
	
Section 14.07
	
Complete Agreement
	
41

	
 
	
 
	
 
	
 

	
 
	
Section 14.08
	
Modifications, Amendments and Waivers
	
41

	
 
	
 
	
 
	
 

	
 
	
Section 14.09
	
Interpretation
	
41

	
 
	
 
	
 
	
 

	
 
	
Section 14.10
	
Severability
	
42

	
 
	
 
	
 
	
 

	
 
	
Section 14.11
	
Time of Essence
	
42

	
 
	
 
	
 
	
 

	
 
	
Section 14.12
	
Gender, Number, Knowledge
	
42

	
 
	
Section 14.13
	
Exhibits and Schedules
	
42

	
 
	
 
	
 
	
 

	
 
	
Section 14.14
	
No Benefit to Others
	
42

EXHIBITS INDEX

	
 
	
EXHIBIT A
	
The Stores

	
 
	
 
	
 

	
 
	
EXHIBIT B
	
Store Inventory Instructions

	
 
	
 
	
 

	
 
	
EXHIBIT C
	
Form of Assignment and Assumption of Leases

	
 
	
 
	
 

	
 
	
EXHIBIT D
	
Form of Trademark Assignment

	
 
	
 
	
 

	
 
	
EXHIBIT E
	
Form of New Leases

	
 
	
 
	
 

	
 
	
EXHIBIT F
	
Form of Pharmacy Client Letter

	
 
	
 
	
 

	
 
	
EXHIBIT G
	
Form of DEA Powers of Attorney

	
 
	
 
	
 

	
 
	
EXHIBIT H
	
Form of Seller Estoppel Certificate

ASSET PURCHASE AGREEMENT

          Asset Purchase Agreement (this "Agreement") made as of this 31st day of March, 2008, by and between Seaway Food Town, Inc., a Michigan corporation  (hereafter "Seller"), and Rite Aid of Ohio, Inc., an Ohio corporation (hereafter "Buyer").  This Agreement is also joined in by Spartan Properties Management, Inc., an Ohio corporation (solely for the purposes of entering into the New Leases (defined below) with Buyer), Spartan Stores, Inc., a Michigan corporation (solely for the purpose of binding itself to the provisions of Section 11.05), Rite Aid Corporation, a Delaware corporation (solely for the purpose of guaranteeing the obligations of Buyer under the New Leases (defined below) at the Effective Time for such Stores), and The Pharm of Michigan, Inc., a Michigan corporation (solely for the purpose of assigning the Marks (defined below) to Buyer). Buyer and Seller are sometimes referred to jointly herein as the "parties" or individually as a "party."

BACKGROUND

On the terms and subject to the conditions hereinafter provided, the parties desire for Buyer or one or more subsidiaries thereof to acquire certain of the operating assets of each retail drug store as set forth on Exhibit A (the "Stores") upon and subject to the terms and conditions hereinafter set forth. 

NOW, THEREFORE, in consideration of the foregoing and of the mutual promises, covenants, representations, warranties, and agreements contained herein, and intending to be legally bound, Buyer and Seller agree as follows:

ARTICLE I

SALE AND PURCHASE OF ASSETS

          Section 1.01     Assets to be Acquired.  Subject to the terms and conditions set forth herein, at the Effective Time for each Store, Seller shall sell, assign, transfer, convey and deliver or cause to be sold, assigned, transferred, conveyed and delivered, to Buyer, free and clear of all mortgages, deeds of trust, pledges, liens, conditional sales agreements, leases (other than the Leases and Subleases and Licenses), lease-purchase agreements, security interests, charges, claims, rights of first option, rights of first refusal or similar restrictions, rights of way, easements, encroachments, servitudes, restrictions, encumbrances, and options (hereafter collectively referred to as "Encumbrances"), other than Permitted Encumbrances (as hereinafter defined), and Buyer shall purchase, acquire and accept from Seller, all of Seller's right, title and interest in and to the following assets of the Seller used or located exclusively at the Stores, whether real, personal or mixed, and whether tangible or intangible (hereafter collectively referred to as the "Purchased Assets"), but not including the Excluded Assets. For purposes of this Agreement, "Permitted Encumbrances" means (A) any Encumbrances permitted by the Leases or disclosed on Schedule 1.01; (B) taxes levied or imposed on, or assessed with respect to, the Fixed Assets, the Owned Real Property (defined below) or any portion of the real property which comprises the Assumed Lease Stores (the "Leased Real Property"), which taxes, assessments, fees or charges are (1) not due and payable as of or prior to the Effective Time for the Store to which such taxes, assessments, fees or charges apply, or (2) are being contested in

good faith and as to which appropriate reserves have been set up and maintained; (C) zoning codes or ordinances, building codes and other laws, regulations, ordinances, decrees or orders regulating the use or occupancy of any Leased Real Property or Owned Real Property; (D) easements, restrictions, covenants, rights of way, servitude, or conditions affecting the Leased Real Property or the Owned Real Property that are of record or that would be revealed by an accurate ALTA/ACSM Land Title Survey or inspection of the Owned Real Property or Leased Real Property; (E) any Encumbrance that does not materially adversely affect the current use or occupancy of such Leased Real Property or Owned Real Property; (F) any right of a landlord under a Lease or of tenants, subtenants or licensees under any lease, sublease or license disclosed on Schedule 1.01(b) or (k); or (G) any Encumbrances permitted by or accepted or waived by Buyer under this Agreement or shown on any title commitment or survey provided to or obtained by Buyer and not objected to by Buyer under this Agreement.  Except as set forth in this Article 1.01,  the "Purchased Assets" shall not include any of Seller's remaining rights, privileges, title or interest in any other assets concerning the Stores:

            (a)        Prescription Files.  Subject to applicable Legal Requirements, all of Seller's prescriptions, prescription files and records, customer lists and patient profiles owned or used by Seller (the "Prescription Files") in connection with the operation of (i) the Assumed Lease Stores (as hereinafter defined), (ii) the Stores listed on Schedule 1.01(a) attached hereto (the "File Buy Stores"), and (iii) the Owned Stores (as hereinafter defined), including but not limited to refill status reports and insurance coverages, co-pay and payment records, any files or records added between the date of this Agreement and the date of transfer and records in whatever medium or form maintained by the Seller.

            (b)        Leases.  All rights and interests of Seller under the real property leases (the "Leases") relating to the Stores listed on Schedule 1.01(b) attached hereto (collectively, the "Assumed Lease Stores").

            (c)        Inventory.   All of Seller's inventory (as defined on Exhibit B hereto) of whatever nature or description located at the Stores at the applicable Effective Time, including but not limited to pharmaceuticals, over-the-counter items, and the like (but not including any Excluded Inventory (as defined on Exhibit B) (collectively the "Inventory").

            (d)        Trademarks and Tradenames.  The name "The Pharm" and all registered and unregistered tradenames, trademarks, servicemarks and applications connected thereto including but not limited to the registered trademarks set forth on Schedule 1.01(d) (the "Marks").

            (e)        Deposits.  All of Seller's lease deposits relating to the Leases and, to the extent transferable, all utility deposits relating to the Assumed Lease Stores and the Owned Stores (the "Deposits").

            (f)         Telephone and Fax Numbers.  The right to use the telephone and fax machine numbers assigned to each of the Stores, as set forth on Schedule 1.01(f).

            (g)        Books and Records.  Copies of  (i) all papers, documents, computerized databases and records of Seller relating to the Purchased Assets that are reasonably necessary for Buyer's operation of the Stores or otherwise required by applicable Legal Requirements, and (ii) the real

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estate files of Seller for the Assumed Lease Stores and the Owned Stores and all original prescriptions for the last two (2) years.

            (h)        Claims Relating to Purchased Assets.  All claims, causes of action, rights of recovery and rights of setoff of every type and kind relating to supplier and manufacturer warranties issued with respect to the Purchased Assets, in each case whether accruing before or after the Effective Time for each Store.

            (i)         Fixed Assets, Personal Property.  All of the fixed assets and personal property (other than inventory which is addressed in Subsection (c) above) located at the Assumed Lease Stores and the Owned Stores and owned and used by Seller exclusively in connection with the operation of the Assumed Lease Stores and the Owned Stores  (the "Fixed Assets"), together with any express or implied warranty by the manufacturer or seller of any item or component thereof and all maintenance records and documents relating thereto.  Set forth on Schedule 1.01(i) is a listing of the Fixed Assets located at the Stores based on the internal records of Seller.  Buyer and Seller acknowledge that certain of the assets listed on Schedule 1.01(i) may not be currently present at the Stores as of the date of this Agreement, and additional assets not listed on Schedule 1.01(i) may be present at the Stores as of the date of this Agreement and further acknowledge and agree that all such fixed assets and personal property located at a Store on the date hereof, not constituting Excluded Assets shall be Purchased Assets (except that Seller may replace broken equipment with equipment of comparable or greater value).

            (j)         Governmental Authorizations.  All licenses, registrations or permits issued, granted, given or otherwise made available by or under any governments, regulatory authorities, governmental departments, agencies, commissions, bureaus, officials, ministers, courts, bodies, boards, tribunals or dispute settlement panels or other law, rule or regulation-making organizations or entities (including any branch, department or board thereof) ("Governmental Body") or pursuant to any federal, state, local, municipal, foreign, international, multinational or other constitution, law, ordinance, principle of common law, rule, code, regulation, ordinance, statute or treaty ("Legal Requirement") exclusively connected or related to the Assumed Lease Stores and the Owned Stores (including but not limited to all lottery, liquor, beer & wine, and tobacco sales licenses, and all certificates of occupancy) and all pending applications therefore or renewals thereof, in each case to the extent transferable to Buyer (the "Governmental Authorizations").

            (k)        Leases to Owned Stores.  Leases in the form attached as Exhibit E (the "New Leases") granting Buyer the occupancy rights on the terms and conditions set forth therein for the parcels and tracts of land commonly known as (i) 801 Dixie Highway, Rossford, Ohio  ("Store 6108") and (ii) 410 Wheeling Street, Oregon, Ohio  ("Store 6111" and collectively with Store 6108 the "Owned Stores"), legally described on Schedule 1.01(k), together with any buildings, structures, fixtures and improvements located thereon, and any Appurtenances thereto (collectively the "Owned Real Property") at the annualized rents set forth on Sechedule 1.1(k).  For purposes hereof "Appurtenances" means all privileges, rights, easements, hereditaments and appurtenances belonging to or for the benefit thereof, including all easements appurtenant to and for the benefit thereof (a "Dominant Parcel") for, and as the primary means of access between, the Dominant Parcel and a public way, or for any other use upon which lawful use of the Dominant Parcel for the purposes for which it is presently being used is dependent, and all rights

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existing in and to any streets, alleys, passages and other rights-of-way included thereon or adjacent thereto (before or after vacation thereof) and vaults beneath any such streets.

            (l)         Subleases and Licenses.  All subleases and licenses for any Assumed Lease Stores as shown on Schedule 1.01(b) and all leases or licenses for any Owned Stores as shown on Schedule 1.01(k) (collectively, "Subleases and Licenses").

            Section 1.02     Excluded Assets.  Notwithstanding anything to the contrary contained in Section 1.01 or elsewhere in this Agreement, the following assets of Seller (collectively, the "Excluded Assets") are not part of the sale and purchase contemplated hereunder, are excluded from the Purchased Assets and shall remain the property of Seller after the Effective Time for each Store:

            (a)        all Excluded Inventory;

            (b)        all cash and cash equivalents (including stamps and activated lottery tickets, but excluding the Deposits), accounts receivable and prepaid expenses not related to the Leases, Subleases or Licenses (which shall be prorated pursuant to Section 2.02);

            (c)        all personnel Records and other Records that Seller is required by Legal Requirements to retain in its possession;

            (d)        all rights of Seller under this Agreement and the other agreements, documents and instruments delivered in connection herewith;

            (e)        any agreement, contract, lease (other than the Leases and the Subleases and Licenses), consensual obligation, promise or undertaking (whether written or oral and whether express or implied), whether or not legally binding (a) under which Seller has or may acquire any rights or benefits; (b) under which Seller has or may become subject to any obligation or liability; or (c) by which Seller or any of the assets owned or used by Seller is or may become bound, in each case with respect to the Purchased Assets (collectively the "Excluded Contracts");

            (f)         except for Prescription Files at File Buy Stores, all of Seller's assets not exclusively located at the Owned Real Property or the Leased Real Property;

            (g)        all of Seller's corporate record books, minute books, accounting records and tax records;

            (h)        vendor merchandising displays or equipment including, but not limited to, ice freezers, refrigerated coolers, water dispensing machines, coin machines, dairy stocking carts, and candy and game vending machines which are standalone and may be plug-in, and are not of the built-in variety;

            (i)         Unicru System and Learning Management System, automatic teller machines (unless subject to a lease, sublease or license disclosed on Schedule 1.01(b) or (k)), employment station kiosks and related equipment, Western Union equipment, and any information technology systems and equipment that are incompatible with Buyer's operations, provided the same can be removed from the Stores without physical damage to the Stores that (i) results in a material

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violation under the applicable Lease or (ii) materially interferes with the normal day-to-day operations of such store;

            (j)         all non-transferable software applications including but not limited to pharmacy software, IBM point of sale software, Chaintrack price management software, Stylus software and Kronos software;

            (k)        all network equipment including but not limited to routers, switches and access points; provided, however, in no case will this include the removal of wiring, conduit and the like;

            (l)         all leased equipment or systems including but not limited to any leased PC's, servers, printers, copy machines, facsimile machines and blood pressure machines;

            (m)       all handheld equipment and related peripherals;

            (n)        ScriptPro robot and Parata Rx Automation;

            (o)        pallet jacks and related unloading equipment;

            (p)        all assets at the Stores owned by any tenants, subtenants or licensees;

            (q)        except for the Marks, all trade names, trademarks and service marks (including Seaway Food Town, or any derivation thereof) that are owned by Seller or Seller's Affiliates;

            (r)        the property and assets expressly designated on Schedule 1.02(r).

            Section 1.03     Assumed Obligations.   In consideration of Buyer's purchase of the Purchased Assets, subject to the terms and conditions set forth herein, as of the Effective Time for each Store, Seller shall assign to Buyer and Buyer shall assume and discharge in a timely fashion all of the liabilities and obligations of Seller under the Leases, the Subleases and Licenses, any Permitted Encumbrances, and any Governmental Authorizations (hereafter referred to as the "Assumed Obligations") arising from and after the Effective Time for such Store.

            Section 1.04     Nonassumption of Liabilities.  It is expressly understood and agreed that, except as expressly provided in Section 1.03 of this Agreement, Buyer shall not, by virtue of this Agreement, the consummation of the transactions contemplated herein, or otherwise, assume or become liable for any liabilities or obligations of Seller or any "Affiliate" or subsidiary of the Seller, or any liability or obligation constituting a lien upon any of the Purchased Assets, regardless of whether such liability is absolute or contingent, liquidated or unliquidated, accrued or unaccrued, known or unknown, arises by operation of law or otherwise, all of which liabilities and obligations of Seller hereby agrees to retain, and timely perform and discharge (hereinafter referred to as the "Excluded Obligations").  Seller shall remain liable for all Excluded Obligations, including any liabilities arising prior to the Effective Time for each Store, any liabilities related to any Excluded Contracts or other Excluded Assets and any liabilities arising under the Leases prior to the Effective Time for each Store.  For purposes of clarity, the foregoing sentence shall not make Seller liable for any liabilities arising under any Permitted

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Encumbrance after the Effective Time for the applicable Store.  Without limiting the generality of the foregoing, in no event shall Buyer assume or otherwise be responsible for or otherwise obligated with respect to (a) any obligations of Seller under HIPAA or other applicable Legal Requirement, including the HIPAA privacy standard requiring accounting of certain disclosures of Protected Health Information (as defined in HIPAA) made by Seller prior to the Effective Time for each Store, (b) any type of successor liability as to Excluded Obligations relating to trade creditors, unemployment, Employees or union  contracts or agreements, income, property, sales or other taxes, or otherwise, or (c) employee benefit plans, practices, programs or arrangements of any type or sort (including the establishment, operation or termination thereof and the notification and provision of COBRA coverage extension) maintained by Seller, it being understood that all such liabilities are Excluded Obligations.  For purposes of this Agreement, "Affiliate" means any Person that directly, or indirectly through one or more intermediaries, controls, is controlled by or is under common control with the Person specified and with respect to Seller specifically includes Spartan Stores, Inc.  For purposes of this definition, control of a Person means the power, directly or indirectly, to direct or cause the direction of the management and policies of such Person whether through ownership of voting securities or ownership interests, by contract or otherwise, and specifically with respect to a corporation, partnership or limited liability company, means direct or indirect ownership of more than 50% of the voting securities in such corporation or of the voting interests in a partnership or limited liability company.

ARTICLE II

PURCHASE PRICE, METHOD OF PAYMENT; INVENTORY

            Section 2.01     Purchase Price.  The purchase price for the Purchased Assets other than Inventory (the "Non-Inventory Purchase Price") shall be $12,846,000  in the aggregate and the purchase price for the Inventory shall be the aggregate of the Inventory Value for each Store as determined in accordance with Section 2.01(a) and Exhibit B (collectively the "Inventory Purchase Price") (the Inventory Purchase Price and the Non-Inventory Purchase Price are collectively referred to as the "Purchase Price").  Buyer shall pay the Inventory Value for each Store plus the amount of the Purchase Price allocated to each Store as set forth on Exhibit A on the business day after the Inventory Date for such Store by wire transfer of immediately available funds to the account or accounts of Seller delivered to Buyer at least 3 calendar days prior to the earliest Effective Time.

            (a)        Inventory.  Seller and Buyer will cause RGIS and/or any other mutually agreed nationally recognized inventory service (the "Inventory Services") to take a physical count and valuation of the Inventory using the methods, standards, procedures and valuation methodology set forth on Exhibit B hereto.  Subject to the satisfaction of the conditions described in Articles VIII and IX hereof, the count of the Inventory for each Store shall be on a date as mutually agreed by the parties (the "Inventory Date"); provided, however, the inventories at all the Stores shall be completed within five business days.  On the Inventory Date for each store, the Store will close for business at approximately 6 p.m. prevailing time at the location of the Store and the inventory will commence immediately upon the Store closing for business (the time of commencement of the inventory at each Store the "Effective Time" as to such Store).   Each party shall have no more than three representatives present during the count of each inventory to resolve any disputed items concerning the inventory.   Buyer and Seller shall then review the

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Inventory Value in order to verify the Inventory Services' calculations and execute an inventory sign-off sheet evidencing each party's agreement to the Inventory Value calculation valued in accordance with Exhibit B hereof (the "Inventory Value").  The sign-off sheet for each Store shall be completed and executed by the parties prior to the departure of the Inventory Service from the applicable Store.  Copies of the sign-off sheets along with the applicable inventory reports shall be delivered to the persons identified in Section 14.01 hereof no later than the day following the Inventory Date.  The expense of the Inventory Services shall be shared equally by Buyer and Seller.  Buyer and Seller shall have fifteen (15) business days after their receipt of the inventory reports in which to examine such accounting, during which time Buyer and Seller shall reasonably cooperate to resolve any computational errors or discrepancies.  If Buyer and Seller are unable to resolve any such errors or discrepancies on mutually agreeable terms, then the matter shall be submitted to a mutually agreed designated accountant for final determination, which determination shall be binding upon Buyer and Seller and not subject to further review. 

            (b)        Operations; Title. 

                        (i)         Subject to the terms and conditions of this Agreement:

                                    (A)       risk of loss to the Purchased Assets will transfer to the Buyer at each Store at the Effective Time with respect to such Store;

                                    (B)       title to the Purchased Assets (including the Inventory) associated with each Store will transfer to the Buyer at the Effective Time for each Store;

                                    (C)       Buyer shall enjoy possession of and the right to use the Assumed Lease Stores, the Owned Stores and the Owned Real Property commencing at the Effective Time with respect to the related Store;

                                    (D)       Seller shall remove (i) all of the Excluded Inventory prior to the Effective Time for such Store; and (ii) the remainder of the Excluded Assets (other than Excluded Assets at the File Buy Stores) prior to the regularly scheduled opening of the applicable store on the day following the Effective Time; and

                                    (E)       All sales at a Store after the Effective Time with respect to such Store shall be for the account of the Buyer.

            (c)        Register Procedures.  Immediately prior to the Effective Time for each Store, the cash and working funds in Seller's cash registers shall be removed and kept by Seller. 

            (d)        Undelivered Prescriptions.  Immediately prior to the Effective Time for each Store, Seller shall reverse and return all filled and undelivered prescriptions at such Store to stock in accordance with applicable governmental regulations, laws and requirements, providing all necessary notice to any third-party payors, and shall provide Buyer with a list of such prescriptions so that Buyer is prepared to fill such prescriptions on or after the Effective Time for such Store. 

            Section 2.02     Prorations.  All current rent (including without limitation percentage rent), real estate taxes, common area charges, utility charges, and other obligations of Seller under the

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Leases or income or obligations of Seller under the Subleases and Licenses, shall be prorated as of the Effective Time with respect to each Assumed Lease Store  in accordance with the payment terms of the Lease applicable thereto (collectively the "Prorated Charges").  Whenever possible, such prorations shall be based on actual, current payments by or income to Seller and to the extent such actual amounts are not available, such prorations shall be estimated as of the Effective Time for the applicable Store based on actual amounts for the most recent comparable billing period and such prorations shall be final (absent manifest error) without further reconciliations.  Notwithstanding anything to the contrary in this Agreement, for any Lease for which a proration is not set forth in a Lease, for the New Leases, and for the Fixed Assets, the property taxes shall be prorated on a "calendar year or lien basis" for any such Assumed Leased Store, Owned Store or Fixed Asset not located in Lucas County, and on a "last tax due date basis" for any such Assumed Leased Store, Owned Store or Fixed Asset located in Lucas County.  Seller shall pay the Buyer a pro rata amount of percentage rent payable by Buyer under a Lease for an Assumed Lease Store for the lease year including the Effective Time for such Lease, not later than ten (10) business days prior to the date that Buyer is obligated to pay such percentage rent.  Seller's prorated share shall be determined by multiplying (A) a fraction, the numerator of which is the amount of Seller's gross annual sales at such Assumed Lease Store from the first day of such lease year to (but not including) the Effective Time for the applicable Store, and the denominator of which is the sum of Buyer's and Seller's gross annual sales at such store for the entire lease year, times (B) the amount of percentage rent actually due under the Lease for such Assumed Lease Store. Seller, upon the request of Buyer, shall promptly provide the Buyer such information as Buyer shall be required to submit to landlords under the Leases in connection with the payment of percentage rent with respect to an Assumed Lease Store. Notwithstanding any of the foregoing, the fixed percentage rent set out in the Fourth Amendment to Lease for Store #6103 of $106,145.40 shall be prorated on a per diem basis as of the Effective Time for the applicable Store based on a lease year commencing July 1, 2007, and ending June 30, 2008.

            Section 2.03     Utilities.  Seller shall pay all utility and other charges applicable to the Assumed Lease Stores and the Owned Stores and billed directly to the tenant in the case of Assumed Lease Stores up through the Effective Time for each Store and Buyer shall be responsible for the same thereafter.

            Section 2.04     Purchase Price Allocation.  The Non-Inventory Purchase Price shall be allocated among the Purchased Assets in the manner set forth on Schedule 2.04 hereto.  Seller and Buyer agree to file all their respective federal, state and local tax returns in accordance with that allocation.

            Section 2.05     Estoppels.  Seller shall send a Landlord Consent and Estoppel Certificate to each of the landlords of the Leases (other than Store #6103 which the parties acknowledge and agree is outside the scope of this Section 2.05 and may be contacted by Buyer immediately after the date hereof) in the form attached hereto as Schedule 2.05 (the "Landlord Consent and Estoppel Certificate") and shall use commercially reasonable efforts to cause each of the landlords of the Leases to complete and execute an estoppel certificate substantially and in all materials respects in the form of the Landlord Consent and Estoppel Certificate and return them to Seller, provided, however, that other than any sums specifically due and payable under the terms of the applicable Lease which shall be the sole responsibility of Seller, Seller shall not be

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obligated to pay any sums of money to obtain such Landlord Consent and Estoppel Certificates.  Seller shall deliver a copy of each signed Landlord Consent and Estoppel Certificate to Buyer's counsel promptly after Seller receives it. 

The process for preparing and sending the Landlord Consent and Estoppel Certificates shall be as follows:

                        (i)         Within three (3) business days after the date of this Agreement, Seller shall send the Landlord Consent and Estoppel Certificates to each of the landlords under the Lease and shall copy Buyer's counsel on all such transmittals.  Seller shall provide prompt written notice to Buyer's counsel of all material written communications between Seller and such landlord and shall provide to Buyer's counsel a copy of any Landlord Consent and Estoppel Certificate promptly after Seller's receipt of same.  The parties hereto acknowledge and agree that Seller shall not object to the deletion by any landlord of the requested release language for the benefit of Seller in paragraph 12 of the form of Landlord's Consent and Estoppel Certificate attached hereto as Schedule 2.05 and Buyer will not object to the deletion by any landlord of paragraph 5 of any such Landlord Consent and Estoppel relating to Buyer's right to install a satellite dish;

                        (ii)        Seller shall have ten (10) business days from the date the Landlord Consent and Estoppel Certificates are sent to deal exclusively with such landlords to obtain execution of such Landlord Consent and Estoppel Certificate; and

                        (iii)       After the expiration of such ten (10) business day period, Buyer may contact such landlords to discuss such non-substantive matters (for example, signage) that do not require material amendments to the Leases as may be required or reasonably necessary to affect the transition of the Stores to a Rite Aid store following the Effective Time for such Store.  The foregoing notwithstanding, at all times following the time at which Seller has obtained the landlord's consent required under this Agreement for a Lease, Buyer may contact such landlord to discuss such matters as Buyer may choose with respect to such Lease without restriction.

ARTICLE III

CLOSING, DOCUMENTS OF CONVEYANCE

            Section 3.01     Closing.    Subject to the satisfaction of the conditions set forth in Articles VIII and IX, the purchase and sale of the Purchased Assets with respect to each Store shall be consummated on the business day following each applicable Effective Time (each a "Store Closing") by facsimile of the signed documents required hereunder with respect to each Store, and shall be deemed effective with respect to each Store as of and at the Effective Time for such Store.

            Section 3.02     Assignment and Assumption Agreements; New Leases.  At the Store Closing for each Store, Buyer and Seller shall execute and deliver to each other instruments of assignment and assumption, in form and content reasonably acceptable to counsel for Buyer and Seller (and which shall be substantially in the form of Exhibit C hereto, except that  Exhibit C shall be modified as necessary based upon a landlord's reasonable comments) pursuant to which Seller shall assign the Leases and Buyer shall assume all obligations thereunder arising from and after the Effective Time for the applicable Store.  The instruments of assignment and assumption

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are hereafter collectively referred to as the "Assignment and Assumption Agreements."  At the Store Closing with respect to the Owned Stores,  Spartan Properties Management, Inc. shall enter into the New Leases for the applicable Owned Store with Buyer as "tenant", and all of the obligations of Buyer under each such New Lease shall be completely and fully guaranteed by Rite Aid Corporation, in each case in the form attached hereto as Exhibit E. 

            Section 3.03     Other Instruments of Conveyance.  Seller shall execute and deliver to Buyer the following instruments of conveyance, each in form and content reasonably acceptable to counsel for the Buyer and the Seller (hereafter referred to as the "Other Instruments of Conveyance"):

            (a)        at the Store Closing for each Store, a bill of sale conveying the Purchased Assets for such Store;           

            (b)        at the last Store Closing hereunder, a Trademark Assignment Agreement providing for the assignment by The Pharm of Michigan, Inc. in form and content reasonably acceptable to counsel for Buyer and Seller (which shall be substantially in the form of Exhibit D hereto), pursuant to which The Pharm of Michigan, Inc. shall convey the Marks to Buyer;

            (c)        at the Store Closing for each Store, a written release of all Encumbrances on the Purchased Assets other than Permitted Encumbrances;

            (d)        such other instruments as may be reasonably requested by the Buyer to convey the Purchased Assets or any part thereto to the Buyer and any Permits to the Buyer;

            (e)        at the Store Closing for each Store, a closing statement confirming the allocation of the Purchase Price and the prorations of credits applicable to each Store; and

            (f)         at the Store Closing for each Store, a non-foreign persons affidavit.

            Section 3.04     Other Deliveries at  Closing.  At the Store Closing for each Store, in addition to the instruments described in Section 3.03, the following deliveries shall be made:

            (a)        the Seller shall deliver to Buyer: (i) all certificates required by Article VIII except such as may be expressly waived in writing by the Buyer; (ii) completed and executed Assignment and Assumption Agreements, (iii) Subordination, Non-Disturbance and Attornment Agreements ("SNDA's") executed by any of Seller's lender(s) who holds a mortgage or other security interest on an Owned Store, such SNDA to be on such lender's standard form; and (iv) copies of the Landlord Consent and Estoppel Certificates to the extent the Buyer has not waived the requirement for same prior to the Kickoff Date; provided, however, that in the event Seller shall have obtained the consent of the applicable landlord to the assignment of one or more Leases but has not obtained the Landlord Consent and Estoppel Certificate for such Leases (or the landlord has returned the applicable Landlord Consent and Estoppel Certificate with the estoppel provisions thereof stricken or otherwise marked or indicated as not applicable or consented to), Seller shall, for each such Lease, deliver to Buyer a Seller Estoppel Certificate in the form attached hereto as Exhibit H.

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            (b)        the Buyer shall deliver to the Seller (i) all certificates required by Article IX, except such as may be expressly waived in writing by Seller; and (ii) completed and executed Assignment and Assumption Agreements; and

            (c)        such other deliveries as may be required by the provisions of Section 3.10.

            Section 3.05     Allocation of Closing Costs.  Except as specifically provided in Section 2.03, or elsewhere in this Agreement, each party shall be responsible for and bear all of its own transactional costs and charges relating to the purchase and sale contemplated herein.

            Section 3.06     Other Obligations.  Unless otherwise specified in this Agreement:  (a) all operating expenses and liabilities relating to the ownership and operation of the Purchased Assets attributable to the period ending on the Effective Time with respect to each Store which are not Assumed Obligations (including but not limited to the Excluded Obligations) shall be the sole responsibility of and paid by the Seller; and (b)  the operating and other liabilities relating to the ownership and operation of the Purchased Assets attributable to periods commencing on or after the Effective Time with respect to each Store shall be the sole responsibility of the Buyer.

            Section 3.07     Transfer of Possession.   With respect to each Store and subject to the Permitted Encumbrances and the terms of the New Leases (if applicable), simultaneously with the Effective Time for such Store, Seller shall give Buyer full possession and enjoyment of the Purchased Assets.

            Section 3.08     Termination and Related Employee Matters.  Immediately prior to the Effective Time for each Store, Seller shall terminate the employment of all of its employees exclusively employed at the applicable Store (all such employees the "Employees"). Immediately following the Effective Time for each Store, Buyer shall employ such of the Employees as it determines in its sole discretion provided, however, the commencement date of such employment of Employees shall not occur prior to the effective date of Seller's termination of such Employee or such Employee's termination of their employment with Seller. Seller shall be responsible for any liability under the Workers' Adjustment and Retraining Notification Act and any similar state or local law or regulation relating to plant closings and layoffs (collectively "WARN") with respect to Employees who are terminated as of or prior to the Effective Time for the Store that employs such Employees.  Buyer agrees that to the extent Buyer determines, in its sole discretion, to hire or retain any of the Employees, Buyer shall, on the first calendar day of the month following each Effective Time, provide insurance coverage to such Employees who are covered by Seller's health plan immediately prior to the applicable Effective Time and who meet Buyer's eligibility requirements.  Buyer shall be responsible for any liability under WARN with respect to employees of Seller who are terminated by Buyer after the Closing.  To the extent required, Seller shall provide notice to its Employees as mandated by the Consolidated Omnibus Budget Reconciliation Act of 1985 ("COBRA").  Seller shall be responsible for all wages, severance pay, notice of termination or termination pay and any other compensation or obligation which may be due by statute, contract or common law pursuant to Seller's termination of any of the Employees.  Buyer shall be responsible for all wages, severance pay, notice of termination or termination pay and any other compensation or obligation which may be due by statute, contract or common law pursuant to the employment of the Employees by Buyer at each Store following the Effective Time for each Store.  Seller shall have full responsibility for and

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shall indemnify Buyer against any severance, COBRA or other claims by Employees not hired by Buyer or who decline employment offered by Buyer arising from or relating to their employment with Seller and/or termination by Seller or who terminate employment with Seller. Buyer agrees that it shall allow "years of service credit" (for purposes of vacation time, sick leave time and personal days only) to the Employees who are hired as full time employees by Buyer.   The years of credit allowed shall be based on Buyer's existing policies.

            Section 3.09     Utility Services.  At the Effective Time or as soon thereafter as practicable, Seller and Buyer will cooperate with each other to arrange to disconnect, transfer or obtain final readings with respect to all electricity, water, telephone, and other utilities serving the Assumed Lease Stores and the Owned Stores and to have such services reconnected in or otherwise transferred to Buyer's name immediately thereafter.

            Section 3.10     Other Actions and Instruments.  Buyer and Seller shall take such other actions and shall execute and deliver such other instruments, documents and certificates at the Store Closing for each Store as are required by the terms of this Agreement or as may be reasonably requested by the Buyer or the Seller in connection with the closing of the transactions contemplated by this Agreement including receipts relating to the payment of the Purchase Price.  In addition, the parties agree that the term Store Closing with respect to each Store shall be interpreted for the purposes of the closing to include each of the parties taking all reasonable actions (including, but not limited to, their respective obligations under Article III) necessary to transfer the Purchased Assets at the Effective Time with respect to each Store to the Buyer.

ARTICLE IV

REPRESENTATIONS AND WARRANTIES OF BUYER

Buyer hereby represents and warrants to Seller as follows:

            Section 4.01     Organization and Good Standing.  Buyer is a corporation duly organized, validly existing, and in good standing under the laws of the State of Ohio. 

            Section 4.02     Corporate Power and Authority.  Buyer has the requisite corporate power and authority to execute, deliver and perform its obligations under and pursuant to this Agreement, including without limitation, the requisite corporate power and authority to acquire and operate the Purchased Assets and assume the Assumed Obligations upon the terms and conditions set forth herein.  The execution and delivery of this Agreement and the consummation of the transactions contemplated hereby have been duly authorized by all necessary corporate action on the part of Buyer.  This Agreement has been duly executed and is a legal, valid and binding obligation of Buyer, enforceable in accordance with its terms, except as such enforcement may be limited by applicable bankruptcy, insolvency, reorganization, moratorium, or similar laws affecting the enforcement of creditors' rights generally and by general principles of equity.

            Section 4.03     Validity of Contemplated Transactions.  The execution, delivery and performance of this Agreement and the consummation of the transactions contemplated hereby by Buyer do not and will not (i) contravene any provisions of the Articles of Incorporation or Bylaws of Buyer, (ii) violate, be in conflict with, constitute a default under, result in the termination of, cause the acceleration of any payments pursuant to, or otherwise impair the good

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standing, validity, and effectiveness of any material agreement, contract, commitment, indenture, lease or mortgage applicable to Buyer, or (iii) violate any Legal Requirement, including without limitation, all applicable securities laws, rules, regulations, orders, permits, licenses, authorizations or approvals to which Buyer is subject, or (iv) violate any judgment, order, writ, prohibition, injunction or decree of any court, governmental body or arbitrator by which Buyer is bound.

            Section 4.04     Regulatory Approvals.  Except for any Governmental Authorizations from the DEA, State Boards of Pharmacy, Ohio Liquor Commission or other similar Governmental Bodies, all material consents, waivers, approvals, authorization or exemptions from Governmental Bodies and other third parties and other material requirements prescribed by any Legal Requirement which must be obtained or satisfied by Buyer in order to permit the consummation of the transactions contemplated by this Agreement have been obtained.  Buyer has given, or prior to the Effective Time for each Store will give, all required notices to the DEA and State Boards of Pharmacy and Ohio Liquor Commission that are required to be given by Buyer in connection with the transactions contemplated by this Agreement.

            Section 4.05     Inventory Held for Resale.  Buyer intends to hold the Inventory for resale to customers and for no other purpose.

            Section 4.06     Brokers.  Buyer does not have any liability or obligation to pay fees or commissions to any broker, finder or agent with respect to the transactions contemplated by this Agreement for which Seller could become liable or obligated

            Section 4.07     Buyer's Knowledge.  Buyer is not aware of any fact or circumstance as of the date of this Agreement which would make, or which would be reasonably expected to render, inaccurate any of the representations or warranties made by Seller in this Agreement.

ARTICLE V

REPRESENTATIONS AND WARRANTIES OF SELLER

Seller hereby represents and warrants to Buyer as follows:

            Section 5.01     Organization, Good Standing and Qualification.  Seller is a corporation duly organized, validly existing, and in good standing under the laws of the State of Michigan.  Seller is duly qualified to do business and is in good standing in each and every jurisdiction where the failure to qualify or to be in good standing would have a material adverse effect upon the conduct of its business or the ownership of the Purchased Assets.

            Section 5.02     Corporate Power and Authority.  Seller has the requisite corporate power and authority to execute, deliver and perform its obligations under and pursuant to this Agreement.  Seller has the requisite corporate power and authority to sell, transfer, assign, convey and deliver to Buyer at Closing, the Purchased Assets as provided herein and, subject to obtaining all requisite third party consents thereto, to assign the Leases to Buyer at the Effective Time for the applicable Store.  Seller has the requisite corporate power and authority to carry on its business operations as they are now being conducted and to own and operate the Purchased Assets.  The execution and delivery of this Agreement and the consummation of the transactions

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contemplated hereby have been duly authorized by all necessary corporate action on the part of Seller.  This Agreement has been duly executed and is a legal, valid and binding obligation of Seller, enforceable in accordance with its terms, except as such enforcement may be limited by applicable bankruptcy, insolvency, reorganization, moratorium, or other laws affecting the enforcement of creditors' rights generally and by general principles of equity.

            Section 5.03     Validity of Contemplated Transactions.  The execution, delivery and performance of this Agreement and the consummation of the transactions contemplated hereby do not and will not (i) contravene any provision of the Articles of Incorporation or Bylaws of the Seller, (ii) violate, be in conflict with, or constitute a default under, result in the termination of, cause the acceleration of any payments pursuant to, or otherwise impair the good standing, validity, or effectiveness of any material agreement, contract, commitment, indenture, lease or mortgage, to which Seller is a party or by which it or the Purchased Assets are bound, (iii) violate any provision of any Legal Requirement, including without limitation, all applicable securities laws, rules, regulations, orders, permits, licenses, authorizations or approvals to which Seller is subject or (iv) violate any judgment, order, writ, prohibition, injunction or decree of any court or other governmental body of competent jurisdiction or arbitrator by which Seller is bound, except to the extent the consent of third parties may be required in connection with the assignment of the Leases or with the Governmental Authorizations.

            Section 5.04     Regulatory Approvals.  Except for any Governmental Authorizations from the DEA, State Boards of Pharmacy, Ohio Liquor Commission or other similar Governmental Bodies, all material consents, waivers, approvals, authorization or exemptions from Governmental Bodies and other third parties (other than consents from the landlords with respect to the Leases) and other material requirements prescribed by any Legal Requirement which must be obtained or prescribed by any Legal Requirement which must be obtained or satisfied by Buyer in order to permit the consummation of the transactions contemplated by this Agreement have been, or will prior to the Effective Time for each Store be, obtained.  Seller has given, or prior to the Effective Time for each Store will give, all required notices to the DEA and State Boards of Pharmacy that are required to be given by Seller in connection with the transactions contemplated by this Agreement.

            Section 5.05     Liabilities and Obligations of Seller.  Seller understands and acknowledges that Buyer is not assuming any liabilities or obligations of Seller other than the Assumed Obligations expressly set forth in Section 1.03.

            Section 5.06     Title to Purchased Assets.  At the Effective Time with respect to each Store, Seller will have good and valid title to all of the Purchased Assets with respect to such Store free and clear of all Encumbrances other than Permitted Encumbrances and no Purchased Asset will be titled in a Person other than Seller (except for the New Leases and the Marks).  Upon delivery to Buyer of the bills of sale, assignments, and other documents of conveyance contemplated by this Agreement, Buyer will receive effective as of the applicable Effective Time with respect to each Store good and valid title to all of the Purchased Assets free and clear of all Encumbrances other than the Permitted Encumbrances. 

            Section 5.07     Assumed Leases.  Subject to receipt of all necessary third party consents, as of the applicable Effective Time, the Buyer will receive and assume Seller's entire

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right, title, interest and obligations in the Leases and Subleases and Licenses free and clear of all Encumbrances other than the Permitted Encumbrances.  Each of the Leases, Subleases and Licenses is valid, binding, in full force and effect, and enforceable by or against Seller in accordance with their respective terms and conditions, and with respect only to Seller's obligations, there is no existing default thereunder or breach thereof or, to Seller's Knowledge, condition which, with the passage of time or notice or both, might constitute such a default by Seller.  There has been no termination or, to Seller's Knowledge, threatened termination or notice of default (not subsequently cured) relating to any such Lease.  To Seller's Knowledge, Seller has provided copies of all documents that are in Seller's real estate files comprising the Leases and Subleases and Licenses.  Buyer acknowledges that such copies of the Leases and Subleases and Licenses may be missing pages, exhibits, or other information.

            Section 5.08     Taxes.  To the best of Seller's Knowledge, there are no outstanding special tax assessments against any of Seller's Fixed Assets or Inventory.  Subject to the prorations set forth elsewhere in this Agreement, Seller has, in respect of the Purchased Assets, filed (or will timely file) all tax returns that are required to be filed and has paid or will timely pay all taxes that have become due pursuant to such tax returns or pursuant to any assessment that has become payable or for which Buyer may otherwise have any transferee liability.  To  Seller's Knowledge, there are no outstanding or delinquent real estate tax assessments against any of the Assumed Lease Stores, the Owned Stores or the Owned Real Property.  The Form W-9 delivered to Buyer at the time of execution of this Agreement reflects Seller's correct Employer Identification Number.

            Section 5.09     Zoning; Easements.  To Seller's Knowledge, Seller's existing use of the Assumed Lease Stores, the Owned Stores and the Owned Real Property is permitted under applicable zoning laws and ordinances.  To Seller's Knowledge and except for Permitted Encumbrances: (i) there are no land use laws, rules, regulations or ordinances or modifications to zoning that materially restrict the use of any of the Assumed Lease Stores, the Owned Stores or the Owned Real Property as used by Seller on the date hereof or, to the Knowledge of Seller, proposed, which materially restrict or prevent, or would materially restrict or prevent, the use of any of the Assumed Lease Stores, the Owned Stores or the Owned Real Property for such use, and (ii) there are no existing easements, right-of-way, or restrictions affecting any of the Assumed Lease Stores or the Owned Stores which could reasonably be expected to materially adversely affect or prohibit the use of the Assumed Lease Stores, the Owned Stores or the Owned Real Property as presently used by the Seller.

            Section 5.10     Litigation, Compliance with Laws.  Except as set forth on Schedule 5.10 hereto, (a) there is no material suit, action, claim, investigation, arbitration, condemnation, administrative or legal or other proceeding or governmental investigation pending or, to Seller's Knowledge, threatened against or related to the Purchased Assets, (b) to Seller's Knowledge, Seller has not failed to materially comply with any Legal Requirement, including without limitation all material ordinances, requirements, regulations, or orders applicable to Seller's operation of the Purchased Assets, (c) Seller has not violated any material order, writ, injunction, judgment, or decree of any court or federal, state or local department, official, commission, authority, board, bureau, agency, or other instrumentality which was issued against  and delivered to Seller.

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            Section 5.11     Permits and Licenses.  To Seller's Knowledge, all permits (including without limitation environmental permits), licenses, certificates, zoning variances, approvals, repackaging agreements or related licenses, and other authorizations ("Permits") (as well as state pharmacy board and DEA licenses and Medicare, Medicaid and NCPDP numbers) (hereafter referred to as the "Licenses") necessary for the operation of the Seller's business at the Stores as it is presently operated, have been obtained and are in full force and effect.  All Permits and Licenses are presently valid and no revocation, cancellation or withdrawal thereof has been effected or, to Seller's Knowledge, threatened. 

            Section 5.12     All Necessary Assets.  The Purchased Assets constitute all of the material assets, contracts and leases used in the operation of Seller's business at the Assumed Lease Stores and the Owned Stores other than the Excluded Assets.

            Section 5.13     Employee Matters; Labor or Employee Disputes. 

            (a)        Set forth on Schedule 5.13 is a list of all Employees on the date hereof for the Stores, including their full legal name, citizen or immigrant status, date of hire, full or part-time status, position, salary, bonus and other compensation information and, in the case of pharmacists, nurses or other licensed Persons, their relevant license numbers.  Schedule 5.13 also identifies all written and oral employee benefit plans, programs or arrangements maintained by Seller for the benefit of any of the Employees.  Except as set forth on Schedule 5.13, Seller is not bound by any written or oral employment agreement, consulting agreement, or deferred compensation agreement with respect to such Employees.  To the Knowledge of Seller, no Employee is a party to, or is otherwise bound by, any agreement or arrangement, including any confidentiality or non-competition agreement, that in any way adversely affects or restricts the ability of a  Employee to perform such Employee's duties to Buyer after the Closing, if any.  To Seller's Knowledge, Seller is not and has never been subject to any affirmative action obligations under any Legal Requirement with respect to any current employees, including Executive Order 11246, or is or has been a government contractor for purposes of any Legal Requirement with respect to the terms and conditions of employment of any current or former employees.

            (b)        Except as set forth on Schedule 5.13 hereto, Seller is not a party to any contract or other agreement with any labor union and is not experiencing or the subject of, or to Seller's Knowledge, threatened by, any union organization campaign or any strike, slowdown, picketing, work stoppage, or other labor disturbance by any labor union or group of employees.   Except as set forth on Schedule 5.13 hereto, there are no, and there have not been any, unfair labor complaints, strikes, walkouts, work stoppages, slow downs, material complaints or material charges of discrimination (including without limitation, based on age, race, gender, marital status, national origin, disability or handicap), other material labor difficulties, or, to Seller's Knowledge, threats of any of the foregoing, affecting Seller or any of its business operations at the Stores.

            Section 5.14     Insurance Coverages.  The Purchased Assets and the Assumed Lease Stores and the Owned Stores are insured pursuant to the same insurance policies that cover Seller's drug stores other than the Stores.  All of such policies with respect to each Store shall be kept in full force and effect until the Effective Time with respect to such Store.  Seller makes no

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representation and warranty with respect to the insurance coverage carried by the landlords under the Leases.

            Section 5.15     Environmental Matters.  Other than in compliance with Legal Requirements, except in the normal course of business,  Seller has not, in connection with Seller's operation of the Assumed Lease Stores, the Owned Stores or the Owned Real Property, at any time, (i) generated, processed, distributed, transported, used, treated, stored, handled, emitted, discharged, released or disposed of (or caused any person or entity to do any of the foregoing or assisted any person or entity in doing any of the foregoing) any oil, gasoline, petroleum-related products, hazardous substances (as defined by the Comprehensive Environmental Response, Compensation and Liability Act "CERCLA"), hazardous waste (as defined by the Resource Conservation and Recovery Act "RCRA"), or pollutants or contaminants (as defined by CERCLA), including, without limitation, asbestos or asbestos containing materials, PCB's and urea formaldehyde (but excluding any such items sold in the ordinary course of its retail business, such as nail polish and the like), or (ii) taken any action or failed to take any action which constitutes a violation (or with respect to the Occupational Safety and Health Act, a material violation) of any federal, state or local law, rule, regulation, order or other requirement relating to health, safety or the environment, which in the case of either (i) or (ii) above imposes liability, responsibility or standards of conduct applicable to environmental conditions including, without limitations, CERCLA, the Superfund Amendment and Reauthorization Act, the Federal Insecticide, Fungicide and Rodenticide Act, the Hazardous Materials Transportation Act, RCRA, the Clean Water Act, the Clean Air Act, the toxic Substances Control Act, the Coastal Area Management Act, any "Superfund" or "Superlien" law, and the Occupational Safety and Health Act (collectively referred to as the "Environmental Laws").  Seller has not received any notices or citations relating to alleged violations of any of the Environmental Laws and does not know of any violations or alleged violations of any of the Environmental Laws at or affecting the Assumed Lease Stores or the Owned Stores whether or not by the Seller and regardless of the time frame in which such violation or alleged violation occurred.

            Section 5.16     Third Party Payors.  Set forth in Schedule 5.16 are the names of the Seller's ten (10) largest payors for the Stores in the aggregate, measured by percentage of revenue for the thirteen fiscal periods ending January 5, 2008.  Also set forth on Schedule 5.16 are each agreement that, to the Seller's Knowledge, provides that Seller is the exclusive supplier of pharmaceutical products and services to any third party payor.

            Section 5.17     Financial Statements.  Schedule 5.17 sets forth separately the prescription and non-pharmacy sales of each Store for Seller's last 13 periods ending March 29, 2008, as compiled from Seller's records (collectively, the "Financial Statements").  The Financial Statements fairly present, in all material respects, the sales of the Stores for the periods indicated therein. 

            Section 5.18     Prescriptions.  Schedule 5.18A sets forth the average weekly prescription count for each of the Stores, and for all Stores collectively, for the thirty (30) week period ending on March 29, 2008.  Schedule 5.18B sets forth, for Seller's Period 10 ending January 5, 2008, the total number of prescription counts and overall percentage of such business (as a portion of the business set forth on Schedule 5.18A for the same period) derived from Non-

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Standard Business and except as set forth on Schedule 5.18B, all prescriptions set forth on Schedule 5.18A for the same time period have arisen from transactions that do not include any "Non-standard Business."  No material increase in the percentage of Non-Standard Business (when compared to the percentage set forth on Schedule 5.18B) has occurred during any period subsequent to Period 10.  As used in this Agreement, "Non-standard Business" means (a) delivering prescriptions by mail, courier, automobile or other delivery system, with a frequency and in amounts outside of the ordinary course of business for retail pharmacies, (b) compounding, including both sterile and non-sterile compounding, other than in the ordinary course of business for retail pharmacies, (c) filling prescriptions that involve any unique, customized or non-standard packaging (except for heat or cold sealed blister packs), including prescriptions filled for patients in independent living, assisted living, nursing home, long-term care or hospice facilities, (d) any business conducted pursuant to Section 340B of the Public Health Service Act, (e) any non-prescription business (including durable medical equipment) done through the pharmacy computer and included in the prescription count, or (f) any other business outside the scope of a customary pharmacy or retail drug-store business.

            Section 5.19     Fixed Assets.  The Fixed Assets are and shall be as of the Effective Time for each Store in the condition actually used in the conduct of the business of the Assumed Lease Stores and the Owned Stores.  Between the date hereof and the Effective Time for each Store, there will not be a material reduction in the Fixed Assets with respect to such Store that would reasonably be expected to result in a material adverse effect to the condition of the Purchased Assets, the Assumed Lease Stores or the Owned Stores, as applicable.     

            Section 5.20     Employee Benefits; ERISA.

            (a)        Except as described in Schedule 5.20, Seller has not entered into any oral or written employment agreement, consulting agreement, or deferred compensation agreement, in each case with respect to any Employee.

            (b)        None of the Purchased Assets is the subject of any lien arising under Section 302(f) of ERISA or Section 412(n) of the Code.

            (c)        To Seller's Knowledge, each employee benefit plan maintained by Seller for the benefit of one or more Employees that is intended to be qualified under Section 401(a) of the Code is so qualified, and Seller agrees to provide such information as may reasonably be requested by Buyer (including, but not limited to, the latest IRS determination letter received by each such tax-qualified plan) for purposes of Buyer's determination whether to accept rollover contributions in its tax-qualified plan or plans attributable to distributions from Seller's plans.  

            Section 5.21     Brokers.  Except for The Food Partners, LLC, Seller has no liability or obligation to pay fees or commissions to any broker, finder or agent with respect to the transactions contemplated by this Agreement for which Buyer could become liable or obligated.  Seller acknowledges and agrees that all such liabilities and obligations to brokers shall be borne exclusively by Seller and Seller shall indemnify and hold Buyer harmless against any and all such liabilities and obligations pursuant to and in accordance with Section 12.01. 

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            Section 5.22     AS IS, WHERE IS.  EXCEPT AS SET FORTH IN THIS AGREEMENT, THE PURCHASED ASSETS ARE BEING TRANSFERRED TO BUYER "AS IS, WHERE IS, AND WITH ALL FAULTS" AND WITHOUT ANY WARRANTIES, EXPRESS OR IMPLIED, INCLUDING WITHOUT LIMITATION ANY WARRANTIES OF MERCHANTABILITY AND/OR FITNESS FOR A PARTICULAR PURPOSE.  Buyer acknowledges and agrees that, except as otherwise expressly stated in this Agreement, Seller has not made, and Seller hereby specifically disclaims any warranty, guaranty or representation, oral or written, past, present or future, including but not limited to any warranty, guaranty or representation concerning the nature and condition of the Purchased Assets or the Stores.  Buyer acknowledges that, having been given the opportunity to inspect the Purchased Assets, Buyer is relying solely on the express provisions of this Agreement and on its own investigation of the Purchased Assets.

ARTICLE VI

ACTIVITIES PRIOR TO THE EFFECTIVE TIME

            Section 6.01     Activities Prior to Effective Time for Each Store.  Seller hereby covenants and agrees that from and after the date hereof to the Effective Time for each Store (unless another time period is provided for below), Seller will, in all material respects:

            (a)        Not sell, assign, lease, transfer, or otherwise dispose of any of the Purchased Assets without the prior written consent of Buyer, except in the ordinary course of business;

            (b)        Not waive any material rights or claims of Seller constituting a part of the Purchased Assets;

            (c)        Except for those expiring on their own terms, maintain in full force and effect all material agreements, contracts, leases, Permits, authorizations, and approvals necessary for or related to its business operations at the applicable Store as such operations are now conducted and comply in all material respects with Legal Requirements applicable to Seller's business operations at the applicable Store;

            (d)        From the date of this Agreement until the Kickoff Date, confine its purchases of Inventory to such quantity as is reasonably appropriate to the operation of the Stores as going concerns in the normal course of its business and will not make any material changes or modifications to any pricing policies at the Stores; provided, however, notwithstanding anything to the contrary in this Agreement, Buyer acknowledges that Seller shall have the right to begin to sell-down Excluded Inventory and Capped Products, and cease purchasing additional Excluded Inventory and Capped Products, at any particular Store during the three week period following the Kickoff Date (as hereinafter defined in Section 6.10) (the "Sell-Down Period"); the foregoing notwithstanding, through the Effective Time for each Store, Seller will continue purchasing pharmacy Inventory in such quantities and at such times as is reasonably appropriate to the operation of the pharmacy within such Store as going concern in the normal course of its business and will not make any material changes or modifications to any pricing policies with respect to the same.  For purposes of this Agreement, "Capped Products" means the following products:  Paper products, household chemicals and pet products and food;

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            (e)        Maintain in the ordinary course of business the applicable Store's historical pharmacy operating hours (and shall keep the Store operating hours the same as, or longer than, the pharmacy operating hours) and pharmacy staffing levels, subject to normal workplace practices and discipline;

            (f)         From the date of this Agreement until the Kickoff Date, use commercially reasonable efforts to preserve the goodwill of any material pharmacy suppliers, contractors, licensors, employees, customers, payors, payment programs, referral sources, doctor groups, hospitals, distributors and others having business relations with respect to the pharmacy operations of the applicable Store and promptly inform Buyer in the event that Seller has reason to believe that its relationship with any such Person that is material to the pharmacy operation of such Store has been materially reduced or terminated or may be in jeopardy of being so reduced or terminated, provided however, that notwithstanding anything to the contrary contained herein, Seller shall not contact, directly or indirectly, any pharmacy suppliers, contractors, licensors, employees, customers, payors, payment programs, referral sources, doctor groups, hospitals, distributors and others having business relations with respect to the pharmacy operations of the applicable Store to encourage such persons or entities to cease doing or materially decrease their business with Buyer at any applicable Store following the Effective Time for such Store; and

            (g)        Except as expressly contemplated by this Agreement each party shall not: (i) take any action that is intended or may reasonably be expected to result in (1) any of the representations and warranties set forth in this Agreement being or becoming untrue in any material respect, (2) any of the conditions to the closing at the Effective Time with respect to each Store set forth in this Agreement not being satisfied or (3) any violation of any provision of this Agreement, except, in each case, as may be required by applicable Legal Requirements; (ii) other than in the ordinary course of business enter into any contract with respect to, or make any increase in (or commitment to increase) the compensation payable to any of its employees or agents located at or related to the Stores; or (iii) sell, lease, transfer or otherwise dispose of (including any transfers from the Seller to any of its Affiliates), or impose or suffer to be imposed any Encumbrance (other than a Permitted Encumbrance) on, any of the Purchased Assets, other than inventory sold or otherwise disposed of for fair value in the ordinary course of the Store's business consistent with past practice.

            (h)        Seller shall not, without Buyer's prior written consent, modify or amend any Lease or consent to any assignment or sublease in connection with any Lease.  Seller shall furnish Buyer with a written notice of the proposed action which shall contain the document which Seller proposes to execute. 

            Section 6.02     Access; Confidentiality Agreement.  Between the date hereof and the date that is forty-five (45) days after the date of this Agreement (the "Due Diligence Period"), Seller will give to authorized representatives of Buyer, upon reasonable notice to Matthew Morris of Food Partners, LLC or such other person as Seller may designate in a writing delivered to Buyer in accordance with Section 14.01, reasonable access, during normal business hours, in such manner as not to unduly disrupt normal business activities, to any and all premises, properties, contracts, commitments, books, records and affairs of the Seller associated with the Stores (with respect to the Stores, such access is limited to a review of the books and records).  Buyer's access to, and inspection of, the Stores will be at Buyer's sole risk and expense and Seller

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will have no responsibility therefore.  Buyer will immediately repair any loss or damage to the Stores caused solely by the acts or omissions of Buyer in connection with its survey, inspection or testing of the Stores hereunder.  Buyer will indemnify and hold Seller harmless from and against any Liabilities arising out of, resulting from or in any way connected with the acts or omissions of Buyer, its employees, agents or contractors in connection with Buyer's access to and inspection of the Stores hereunder.  The Confidentiality Letter Agreement previously executed by the parties (the "Confidentiality Agreement") shall survive the execution of this Agreement and the Store Closings hereunder and shall continue in full force and effect in accordance with its terms as such terms are explicitly modified by this Agreement.

            Section 6.03     Seller's Employees.  Buyer and Seller acknowledge and agree that from and after the date hereof:

            (a)        Buyer shall have the right to interview and offer employment in its intended business operations to the Employees;

            (b)        Buyer shall have the right, but not the obligation, to approach any labor union or other Employee representative group or organization to pursue, negotiate, and obtain such agreements as Buyer determines in its sole discretion in connection with the operation of the business by Buyer following the Effective Time with respect to each Store; and

            (c)        Seller shall have the right to offer employment or transfer to other operations of Seller or its Affiliates any regional office employees that oversee the operations of the Stores, but do not work in any given Store on a full-time basis.  A list of such employees is set forth on Schedule 6.03 to this Agreement.

            Section 6.04     Public Announcements.  Except as set forth in Section 14.06 hereof, neither party shall make any public announcements or disclosures regarding the transactions contemplated herein without the prior consent of the other party, including its approval of the content thereof.

            Section 6.05     Record Data; Patient Notification. 

            (a)        The parties agree that Buyer will engage Two Point Conversions, Inc. (the "Data Converter") to convert Seller's electronic records of Prescription Files, patient records and other data (the "Record Data") to a format specified by Buyer.  Seller agrees to provide such access, information and cooperation to the Data Converter as may be required to enable the Data Converter to deliver the Record Data to Buyer at least two (2) business days prior to Effective Time for each Store.  The costs and expenses of the Data Converter will be paid by Buyer.  To the extent such record conversion is not successful at any particular Store, Seller agrees to provide to Buyer, at no cost to Buyer, a computer terminal to provide electronic access to such Record Data until such time as the record conversion is successful, or Buyer is able to operate such Store without the need for such computer terminal; provided, Seller's obligation to provide such computer terminal shall in all cases terminate on the date that is six (6) month after the Effective Time for the applicable Store.

            (b)        Seller will retain a complete copy of all Record Data in accordance with applicable record retention Legal Requirements.  In addition, Seller agrees to make electronic

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data included among the Record Data currently used for record keeping purposes available to Buyer for a period of six (6) months from the Effective Time for the applicable Store.  Seller will retain a complete copy of all Record Data in accordance with applicable Legal Requirements regarding retention of records.  Buyer shall reimburse Seller for any incremental license fees or other expenses incurred by Seller exclusively as a result of maintaining such computer software for the period specified herein.

            (c)        If desired by Buyer, Seller agrees that Buyer will be permitted to directly, through one or more of its Affiliates or through the engagement of a third party distributor (the "Third Party Distributor") to notify each customer of any Store who has had a prescription filled or refilled at a Store within the two years prior to the Effective Time for the applicable Store by mailing each of them a letter in the form attached as Exhibit F.  In such event, the parties agree that, promptly after its receipt of the Record Data, the Data Converter will provide the Record Data to the Third Party Distributor in order to enable the Third Party Distributor to assemble and distribute these letters.  

            Section 6.06     Matters Related to Prescriptions.  Prior to the Effective Time for each Store, Seller shall use reasonable efforts to fill and deliver to pharmacy customers any partial-fill prescriptions with a remaining quantity balance ("IOU Prescriptions").  For any IOU Prescriptions remaining at the Effective Time for each Store, Seller shall credit the prescription to the customer or to the third-party payer, as appropriate, as of the Effective Time.  Buyer assumes no liability for IOU Prescriptions.  In addition, prior to the Effective Time for each Store, Seller shall reverse and return to stock any filled prescriptions that have not been picked up, providing all necessary notice to any third-party payors, and shall provide Buyer with a list of such prescriptions so that Buyer is prepared to fill such prescriptions on or after the Effective Time of each Store.

            Section 6.07     Compliance with Law.  The parties agree to comply fully with the provisions of the United States Controlled Substance Act of 1970, as such act may relate to the transfer of the Inventory, and with all applicable Legal Requirements as they may relate to the transfer of the Inventory.  Seller shall notify the appropriate governmental agencies, including the appropriate State Board of Pharmacy or similar office and the regional office of the United States Drug Enforcement Agency ("DEA"), of the transactions contemplated by this Agreement.

            Section 6.08     Restrictive Covenants.  Between the date of this Agreement and twelve (12) months after the last Effective Time for any Store hereunder, neither Seller nor any of its Affiliates shall (i) solicit or recruit any Employee who has been hired by Buyer or (ii) encourage any such Employee to leave the employment of Buyer; provided, that the provisions of this Section 6.08 shall not apply with respect to any Employee who (i) responds to a public advertisement by Seller or (ii) is not hired by Buyer or (iii) is hired by Buyer but subsequently leaves the employ of Buyer. 

            Section 6.09     Landlords.  Prior to the Effective Time for each Store, the Seller will use all commercially reasonable efforts (without any obligation of Seller to pay money for such consent other than such amounts specifically due and payable under the terms of the applicable Lease): (i)  to obtain a Landlord Consent and Estoppel Certificate from each landlord under a Lease for an Assumed Lease Store;  and (ii) to obtain a written modification to the use clauses

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contained within the Leases for Stores #6110 and #6125 so as to permit as an additional permitted use the use of same by Buyer after the Effective Time for each such Store as a "full service retail drug store with licensed pharmacy operation" (collectively the "Two Mandatory Lease Amendments").  Buyer shall not materially adversely interfere with Seller's attempts to obtain the Landlord Consent and Estoppels Certificates, or the Two Mandatory Lease Amendments, and in connection therewith shall comply with the covenants set forth in Section 2.05 of this Agreement.

            Section 6.10     Prescription Count.  Prior to the end of the third business day immediately following the Kickoff Date, Seller shall deliver to Buyer a summary, which shall be certified by Seller as true, correct and complete, of the  average weekly number of prescriptions filled at all Stores in the aggregate during the thirty (30) weeks immediately prior to the Kickoff Date (the "Kickoff Count").  If the Kickoff Count is less than the 18,197 (the average weekly script count for all the Stores in the aggregate provided to Buyer during the evaluation of this transaction in the information memorandum) (the "Evaluation Count") then the following will occur:  (a) if the Kickoff Count is greater than or equal to 90% of the Evaluation Count, then no adjustment will be made to the Non-Inventory Purchase Price; and (b) if the Kickoff Count is less than 90% of the Evaluation Count, then the Non-Inventory Purchase Price will be reduced by a percentage equal to 90% minus the percent that the Kickoff Count is of the Evaluation Account.  By way of example and for purposes of greater clarity, if the Kickoff Count is 75% of the Evaluation Count, than the Non-Inventory Purchase Price will be reduced by 15%.  For purposes of this Agreement, the "Kickoff Date" is that date on which Buyer (i) has notified Seller that Buyer has waived all its right, if any, to terminate this Agreement pursuant to Article VII except as specifically set forth in Section 13.07; and (ii) has provided to Seller written confirmation that to Buyer's Knowledge, Buyer is not aware of any breaches by Seller of any representations, warranties or covenants under this Agreement as of the such date that would give rise to termination rights on behalf of Buyer.  The Kickoff Date shall in no event be less than twenty one (21) calendar days prior to the first Effective Time.

            Section 6.11     Wiring and Equipment Installation.  The Seller agrees that Buyer may, and Seller will, subject to the applicable Lease, give to authorized representatives of Buyer reasonable access, in such manner as not to unduly disrupt normal business activities, to any and all premises and properties related to the Stores so that Buyer may (i) prior to the Effective Time for a Store, pre-wire the Store to facilitate the installation of its satellite, point-of-sale and pharmacy systems equipment in that Store and (ii) at its own risk, store (and prepare for installation) that equipment in each Store at any time after the execution and delivery of this Agreement; provided, however, that Buyer's activities shall be at Buyer's sole risk and shall not interfere with or disrupt the electrical, telephone, check-out or other systems at the Store or otherwise interfere with normal operations at the Store and shall be in compliance with the applicable Lease.  Buyer shall indemnify and hold harmless Seller against any violation or default of any Leased caused by Buyer's actions under this Section 6.11.  Further, if Closing does not occur hereunder, Buyer shall in addition indemnify and hold harmless Seller from any other Liabilities Seller may suffer as a result of Buyer's actions under this Section 6.11. 

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ARTICLE VII

DUE DILIGENCE; CONDEMNATION; CASUALTY; CONSENTS; ENVIRONMENTAL

            Section 7.01     Premises Defects.  If, on or before the expiration of the Due Diligence Period, Buyer notifies Seller of any Premises Defect,  Seller will have thirty (30) days from the date of receipt of any such notice to cause such Premises Defect to be removed, cured or insured over.  If Seller, in its sole discretion, is unwilling or unable to remove, cure or insure over any Premises Defect within such period, Buyer will notify Seller within five (5) days from the expiration of such period to state whether Buyer will:  (a) elect to waive the Premises Defect, release Seller from any obligation or liability for the Premises Defect, and complete the acquisition of the Purchased Assets in accordance with this Agreement, or (b) terminate this Agreement.  For purposes of this Agreement, "Premises Defect" means  any matter shown in any title commitment or survey or physical report (other than an environmental report) obtained by Buyer for any Assumed Lease Store or Owned Store that (i) as it relates to the condition of the Store has a material adverse effect on the structural integrity of such Store, or (ii) as it relates to any other matter, in the reasonable commercial judgment of Buyer, would materially and adversely affect the ability of Buyer to operate a full service drug store at such Store.  Buyer shall promptly (but in no case less than 3 business days after Buyer's receipt thereof) provide Seller with a copy of each such title commitment or survey or physical report upon receipt of same by Buyer.

            Section 7.02     Lease Amendment.  In the event that Buyer does not receive from the landlord at Store #6103 (as shown on Exhibit A) a lease term extension of at least 10 years by  the end of the Due Diligence Period, Buyer will notify Seller prior to the expiration of the Due Diligence Period whether Buyer will:  (a) elect to waive such lease extension, release Seller from all liabilities and obligations relating to the absence of such extension, and complete the acquisition of the Purchased Assets in accordance with this Agreement, or (b) refuse to purchase the Purchased Assets at either or both of Stores #6103 and #6106,  and refuse to assume the Lease with respect to such Store #6103  and Buyer shall be entitled to deduct from the Non-Inventory Purchase Price the amount set forth opposite each of such Stores #6103 and #6106 on Exhibit A to which Buyer exercises such right.  If Buyer elects to refuse to purchase either or both of Stores #6103 and #6106, the following shall occur:  (i)  such Stores so excluded shall be deemed Remaining Stores and Licensed Stores (and not an Assumed Lease Store or File Buy Store) under Section 11.15, and Seller shall have the right to use the "Pharm" name at such locations pursuant to Section 11.15; and (ii) Seller shall have the ability to continue to operate such excluded Stores without any restriction imposed hereunder, including any restrictions set forth in Section 11.05 of this Agreement.

            Section 7.03     Casualty.

            (a)        Assumed Lease Store or Owned Store. 

                        (i)         If prior to the Kickoff Date, any material portion (as determined by Buyer in the exercise of its reasonable commercial judgment) of the Store premises and/or Purchased Assets at the applicable Assumed Lease Store or Owned Store is damaged or destroyed by fire or any other casualty (a "Material Casualty"), Seller will promptly give notice of the same to Buyer.  Seller will have thirty (30) days from the date of receipt of any such notice to repair such

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Material Casualty to the condition of such Store prior to such Material Casualty.  If Seller, in its sole discretion, is unwilling or unable to repair such Material Casualty within such period, Buyer will notify Seller within five (5) days from the expiration of such period to state whether Buyer will elect, as its sole remedy, to either:  (a) waive the Material Casualty, release Seller of any obligation or liability with respect to the Material Casualty, and complete the acquisition of the Purchased Assets at such Store in accordance with this Agreement, or (b) terminate this Agreement. 

                        (ii)        If after the Kickoff Date but prior to the Effective Time for an Assumed Lease Store or Owned Store there is a Material Casualty, Seller will promptly give notice of the same to Buyer.  Buyer will notify Seller within five (5) days of such notice by Seller to state whether Buyer will elect, as its sole remedy, to either:  (a) waive the Material Casualty, release Seller of any obligation or liability with respect to the Material Casualty, and complete the acquisition of the Purchased Assets at such Store in accordance with this Agreement, or (b) refuse to purchase the Purchased Assets and assume the Lease (or enter into the New Lease, as the case may be) with respect to such Store that is the subject of the Material Casualty and (i) Buyer shall be entitled to deduct from the Non-Inventory Purchase Price the amount set forth opposite such Store on Exhibit A, (ii) such Stores so excluded shall be deemed Remaining Stores and Licensed Stores (and not an Assumed Lease Store or File Buy Store) under Section 11.15, and Seller shall have the right to use the "Pharm" name at such locations pursuant to Section 11.15; and (iii) Seller shall have the ability to continue to operate such excluded Stores without any restriction imposed hereunder, including any restrictions set forth in Section 11.05 of this Agreement. 

                        (iii)       If Buyer elects to waive the Material Casualty in accordance with this Section 7.03(a), or if less than a material portion (as determined by Buyer in the exercise of its reasonable commercial judgment) of the Purchased Assets are so damaged or destroyed, Buyer will be entitled to the benefits of all insurance proceeds and claims relating to any such fire or casualty loss (except business interruption insurance) and Seller will at or prior to Store Closing with respect to such Store assign to Buyer all such insurance proceeds and claims.  Seller will inform Buyer of any negotiations with respect to insurance claims involving any damaged Purchased Assets, will permit Buyer to take part therein, and will not settle any such claims without Buyer's prior written consent, which consent shall not be unreasonably withheld, conditioned or delayed, and if there is any deductible or self insurance retention, Buyer shall pay it.

            (b)        File Buy Stores.  If prior to the applicable Effective Time, there is a Material Casualty (as determined by Buyer in the exercise of its reasonable commercial judgment) at a File Buy Store, then Seller will promptly give notice of the same to Buyer and the parties will immediately proceed to close the sale and purchase of the Purchased Assets applicable to such File Buy Store; provided that any such closing shall in no way act as a waiver of any rights or privileges, alter any time periods, or otherwise have any effect whatsoever on the provision of this Agreement with respect to the other Stores and the closing of the contemplated transactions with respect to such other Stores.  Buyer shall not be entitled to any insurance proceeds for such Store.  Notwithstanding the foregoing, Buyer shall not be obligated to close the purchase of the Purchased Asset contained within Store 6106 even if a Material Casualty has occurred until it has closed the purchase of the Purchased Assets within Store 6103.

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            Section 7.04     Condemnation.

            (a)        If prior to the Kickoff Date, any authority having the right of eminent domain commences negotiations or commences legal action for the damaging, taking or acquiring of the leased premises or any Appurtenances thereto (as the same is defined in the applicable Lease or New Lease) at any Store or any material portion (as determined by Buyer in the exercise of its reasonable commercial judgment) thereof, by condemnation or by exercise of the right of eminent domain (a "Material Taking"), Seller will promptly give notice of the same to Buyer.  Buyer will notify Seller within five (5) days from the notice by Seller to state whether Buyer will elect, as its sole remedy, to either:  (i) waive the Material Taking, release Seller of any obligation or liability with respect to the Material Taking, and complete the acquisition of the Purchased Assets in accordance with this Agreement, or (ii) or terminate this Agreement. 

            (b)        If after the Kickoff Date but prior to the Effective Time for an Assumed Lease Store or Owned Store there is a Material Taking, Seller will promptly give notice of the same to Buyer.  Buyer will notify Seller within five (5) days of such notice of whether Buyer will elect, as its sole remedy, to either:  (i) waive the Material Taking, release Seller of any obligation or liability with respect to the Material Taking, and complete the acquisition of the Purchased Assets at such Store in accordance with this Agreement, or (ii) refuse to purchase the Purchased Assets and assume the Lease (or enter into the New Lease, as the case may be) with respect to such Store that is the subject of the Material Taking and (x) Buyer shall be entitled to deduct from the Non-Inventory Purchase Price the amount set forth opposite such Store on Exhibit A, (y) such Stores so excluded shall be deemed Remaining Stores and Licensed Stores (and not an Assumed Lease Store or File Buy Store) under Section 11.15, and Seller shall have the right to use the "Pharm" name at such locations pursuant to Section 11.15; and (z) Seller shall have the ability to continue to operate such excluded Stores without any restriction imposed hereunder, including any restrictions set forth in Section 11.05 of this Agreement.

            (c)        If Buyer does not elect to terminate this Agreement pursuant to Section 7.04(a)(ii), does not exclude the applicable Store or Stores pursuant to Section 7.04(b)(ii), or if the taking is not material (as determined by Buyer in the exercise of its reasonable commercial judgment), then upon Effective Time for such Store, Buyer will be entitled to the benefits of all awards, claims, settlement proceeds, and other proceeds payable by reason of any such taking, and Seller will assign to Buyer all awards, claims, settlement proceeds, or other proceeds payable by reason of any such taking.  In the event of any negotiations with respect to any of the Purchased Assets, the Assumed Lease Stores or the Owned Store with any authority regarding settlement on account of any taking, Seller will inform Buyer of all such negotiations, will permit Buyer to take part therein, and will not enter into any settlements thereof without Buyer's prior written consent.

            Section 7.05     Landlord Consents and Two Mandated Lease Amendments.  If, between the date hereof and the expiration of the Due Diligence Period, Seller does not receive a landlord consent to assignment for an Assumed Lease Store, or Seller has not obtained the Two Mandatory Lease Amendments, Seller shall notify Buyer in writing within two (2) days after the expiration of the Due Diligence Period of such fact and Seller will have an additional five (5) business days from the date of delivery of any such notice to cause such landlord to give such consent and/or obtain such Two Mandatory Lease Amendments (or to have either of the

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foregoing insured over in a commercially reasonable manner acceptable to Buyer).  If Seller, in its sole discretion, is unwilling or unable to obtain such consent or insure over the lack of such consent within such period or obtain the Two Mandatory Lease Amendments or insure over the lack of either Amendment in a commercially reasonable manner acceptable to Buyer, Buyer will notify Seller within five (5) days from the expiration of such period to state whether Buyer will:  (a) elect to waive such requirement, release Seller from all liabilities and obligations relating to the absence of such consent and/or Amendment, and complete the acquisition of the Purchased Assets in accordance with this Agreement, or (b) terminate this Agreement.   

            Section 7.06     Environmental.  Within ten (10) days after the date hereof, Buyer may cause to be commenced a study and report (the "Phase I") to be prepared and completed prior to the Due Diligence Deadline describing the presence, if any, of any toxic or hazardous substances and/or materials including, but not limited to, the existence of any underground storage tanks and/or asbestos located in, under or about each of the Assumed Lease Stores and the Owned Stores by one or more  environmental engineering firms acceptable to Buyer ("Buyer's Environmental Consultant").  Such reports shall conform to American Society for Testing Materials Standard E1527-05 for Phase I.  If recommended by any Phase I, Buyer shall have thirty (30) days following its receipt of the Phase I to cause a Phase II Assessment to be completed (the "Phase II").  If a Phase II is not affirmatively recommended in the Phase I or if Buyer does not cause a Phase II to be completed within the timeframe set forth above, Seller shall have no further obligations to provide access to Buyer in connection with environmental studies and due diligence under this Section 7.06 as to such Assumed Lease Stores or the Owned Stores.  If any toxic or hazardous substance or materials, asbestos, lead containing materials or underground storage tanks is disclosed by any Phase I or Phase II as to which (i) Remediation (defined below) is required by Environmental Law to be performed by Seller (or if the transaction closes, would be required to be performed by Buyer) then Seller shall, within (5) days after receipt of notice from Buyer thereof, inform Buyer if Seller, in its sole discretion, shall commence and diligently pursue the removal, remediation or disposal of any such toxic or hazardous substance or material, asbestos, lead containing materials or underground storage tanks in the manner required by Environmental Law ("Remediation").  If Seller, in its sole discretion, is unwilling or unable to perform such Remediation, Buyer will notify Seller within five (5) days from the expiration of such period to state whether Buyer will:  (a) elect to waive any such environmental condition and the Remediation related thereto, release Seller from any obligation or liability for the environmental condition and the Remediation related thereto, and complete the acquisition of the Purchased Assets in accordance with this Agreement, or (b) terminate this Agreement.  

ARTICLE VIII

CONDITIONS TO OBLIGATIONS OF BUYER

The obligations of Buyer to consummate the transactions contemplated hereby will be subject to the satisfaction or the waiver by Buyer, at or prior to the applicable Effective Time, of the following conditions:

            Section 8.01     Representations and Warranties.  The representations and warranties of Seller contained in this Agreement, the Exhibits and Schedules hereto, or in any other document delivered pursuant hereto or in connection herewith, shall have been true and correct

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in all material respects on the date such representations and warranties were made, and at the applicable Effective Time, as though made on and as of the applicable Effective Time; provided, however, that each of the representations and warranties in this Agreement that contains an express materiality qualifier shall have been true and correct in all respects as of the date made and shall be true and correct in all respects as of the applicable Effective Time, and Seller will have delivered to Buyer a certificate to such effect signed by an authorized officer of Seller.

            Section 8.02     Performance of Covenants, Agreements and Obligations.  Each covenant, agreement and obligation of Seller to be performed on or before the applicable Effective Time pursuant to the terms and specific provisions of this Agreement, including but not limited to the delivery of each document or instrument required to be delivered by Seller under the Agreement, will have been duly performed in all material respects on or before the applicable Effective Time, and at the Closing, Seller will have delivered to Buyer a certificate to such effect signed by an authorized officer of Seller; provided, however, the obligation of Seller to deliver any closing document hereunder with respect to any Store shall be completed at the Store Closing for each Store.

            Section 8.03     Prohibitions.  No claim, action, suit, investigation, arbitration or legal or other proceeding or governmental investigation will be pending or threatened before any court or governmental agency which presents a substantial risk of the restraint or prohibition of the transactions contemplated by this Agreement or the obtaining of material damages or other relief in connection therewith.

            Section 8.04     Authority.  All actions required to be taken by, or on the part of Seller, to authorize the execution, delivery and performance of this Agreement, and the consummation of the transactions contemplated hereby will have been duly and validly taken by the Board of Directors of Seller.

ARTICLE IX

CONDITIONS TO OBLIGATIONS OF SELLER

The obligations of Seller to effect the transactions contemplated hereby will be subject to the satisfaction or the waiver by the Seller, at or prior to the applicable Effective Time, of the following conditions:

            Section 9.01     Representations and Warranties.  The representations and warranties of Buyer contained in this Agreement or in any document delivered by Buyer pursuant hereto shall have been true and correct in all material respects on the date such representations and warranties were made, and at the applicable Effective Time, as though made on and as of the applicable Effective Time; provided, however, that each of the representations and warranties in this Agreement that contains an express materiality qualifier shall have been true and correct in all respects as of the date made and shall be true and correct in all respects as of the applicable Effective Time, and Buyer will have delivered to Seller a certificate to such effect, signed by an authorized officer of Buyer.

            Section 9.02     Performance of Covenants, Agreements and Obligations.  Each covenant, agreement and obligation of Buyer to be performed on or before the applicable Effective Time pursuant to the terms and specific provisions of this Agreement, including but not

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limited to the delivery of each document or instrument required to be delivered by Buyer under the Agreement, will have been duly performed in all material respects on or before the applicable Effective Time and Buyer will have delivered to Seller a certificate to such effect, signed by an authorized officer of Buyer; provided, however, the obligation of Buyer to deliver any closing document hereunder with respect to any Store shall be completed at the Store Closing for each Store.

            Section 9.03     Prohibitions.  No claim, action, suit, investigation, arbitration or legal or other proceeding or governmental investigation will be pending or threatened before any court or governmental agency which presents a substantial risk of the restraint or prohibition of the transactions contemplated by this Agreement or the obtaining of material damages or other relief in connection therewith.

            Section 9.04     Authority.  All actions required to be taken by, or on the part of the Buyer to authorize the execution, delivery and performance of this Agreement, and the consummation of the transactions contemplated hereby will have been duly and validly taken.

ARTICLE X

SURVIVAL OF REPRESENTATIONS AND WARRANTIES; INDEMNIFICATION

            Section 10.01   Survival of Warranties.  Except as expressly set forth herein, the representations and warranties of the parties hereto contained herein or in any document required to be delivered pursuant hereto for such Purchased Asset at such Store shall survive the Effective Time for such Store until eighteen months after such Effective Time for such Store; provided that (a) the representations and warranties set forth in Sections 5.08 and 5.20 shall survive for a period ending six (6) months after the expiration of the applicable statute of limitations and (b) the representations and warranties set forth in Sections 4.02, 4.06, 5.02, 5.06,  5.15 and 5.21 shall survive indefinitely.  Unless a shorter time period is specified in this Agreement, the covenants and agreements of the parties hereto contained herein shall survive indefinitely.  Notwithstanding the preceding sentence, all claims relating to Buyer's obligations to satisfy the Assumed Obligations under this Agreement and Seller's obligation to satisfy the Excluded Obligations under this Agreement shall survive until the expiration of all applicable statutes of limitations, as the same may be extended or waived.  Any right of indemnification pursuant to this Article X with respect to a breach or a claimed breach of a covenant, agreement, representation or warranty or otherwise will expire on the applicable date described in the preceding sentences, unless, on or prior to such date, written notice asserting such breach, and setting forth in reasonable detail a description of and (to the extent capable of being calculated or determined) a reasonable estimate of the amount involved in such breach, has been given to the party from whom indemnification is sought in which event such right of indemnification shall continue with respect to, and only with respect to, the claimed breach for which notice was received within the applicable limitations period.

            Section 10.02   Indemnification by Seller.  Seller, except for any prior knowledge obtained by Buyer as a result of any inspection or investigation on the part of Buyer prior to the date of this Agreement and except as otherwise provided in this Agreement, hereby agrees to indemnify and hold harmless the Buyer against and in respect of any loss, claim, liability, deficiency, obligation, fines, penalties, costs, expenses (including costs of investigation and

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defense and reasonable fees and costs of attorneys) and damages (collectively "Liabilities") arising, directly or indirectly, from or in connection with any of the following:

            (a)        (i) any breach of a representation or warranty in this Agreement on the part of Seller, or (ii) any breach or non-fulfillment of any agreement or covenant in this Agreement on the part of Seller;

            (b)        any Liabilities which may be suffered by or asserted against the Buyer or the Purchased Assets arising at any time in connection with Seller's ownership or operation of the Purchased Assets or the Stores prior to the Effective Time for each Store;

            (c)        all Liabilities of Seller (including but not limited to product liability claims arising out of sales made by Seller prior to the Effective Time for each Store), or claims against Seller or against Buyer (to the extent the same arises out of Seller's performance of, or failure to perform, the transactions contemplated by this Agreement), of every kind and description, regardless of how and when the same may have arisen, including but not limited to the Excluded Obligations, except for the liabilities and obligations which are Assumed Obligations;

            (d)        all claims against, or claims of any interest in, or of a lien upon, any or all of the Purchased Assets to be transferred hereunder by Seller to Buyer, which arise in connection with events, acts, omissions, or circumstances occurring or existing prior to the Effective Time for each Store (other than Permitted Encumbrances); and

            (e)        all actions, suits, proceedings, demands, assessments, judgments, attorneys' fees, costs and expenses incident to the foregoing.

            Section 10.03   Indemnification by Buyer.  Buyer, except for any prior knowledge obtained by Seller as a result of any inspection or investigation on the part of Seller prior to the date of this Agreement or as otherwise provided in this Agreement, hereby agrees to indemnify and hold harmless the Seller against and in respect of any Liabilities arising, directly or indirectly, from or in connection with any of the following:

            (a)        (i) any breach of a representation or warranty in this Agreement on the part of Buyer, or (ii) any breach or non-fulfillment of any agreement or covenant in this Agreement on the part of Buyer;

            (b)        any Liabilities which may be suffered by or asserted against the Seller or the Purchased Assets arising at any time in connection with Buyer's ownership or operation of the Purchased Assets or the Stores following the Effective Time for each Store;

            (c)        any Liabilities which may be suffered by or asserted against Seller arising in connection with Buyer's failure to perform its obligations with respect to the Assumed Obligations; and

            (d)        all actions, suits, proceedings, demands, assessments, judgments, attorneys' fees, costs and expenses incident to the foregoing.

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            Section 10.04   Limitations of Indemnity.  Notwithstanding any provisions herein to the contrary:

            (a)        Time Limitations.  Neither party will be liable to the other party for any claim based on a misrepresentation, breach of warranty or nonfulfillment of any covenant or agreement herein for which it has not received written notice prior to the expiration dates set forth in Section 10.01.  Notwithstanding the foregoing, the limitations set forth in this Section 10.04(a) shall not apply to any breaches of Sections 4.02, 4.06, 5.02, 5.06,  5.15 and 5.21 each of which shall be perpetual.

            (b)        Monetary Limitations.

                        (i)         No claim may be made against Seller for indemnification pursuant to Sections 10.02(a)(i) unless and until the aggregate of all claims for indemnification by Buyer pursuant to Section 10.02(a)(i) shall exceed $100,000 (the "Threshold Amount"), in which event Seller shall be liable for all Liabilities from dollar one; it being understood and agreed that the foregoing Threshold Amount shall not apply to claims for indemnification relating to Excluded Obligations, in each case for which Seller shall be responsible from dollar one, whether or not the Threshold Amount has been reached; 

                        (ii)        Buyer shall have no liability for its indemnification obligations under Section 10.03(a)(i) until the aggregate amount of all Liabilities incurred by the Seller equals or exceeds the Threshold Amount, in which event Buyer shall be liable for all Liabilities from dollar one; it being understood and agreed that the foregoing Threshold Amount shall not apply to claims for indemnification relating to Assumed Liabilities, in each case for which Seller shall be responsible from dollar one, whether or not the Threshold Amount has been reached; 

                        (iii)       For the purposes of this Section 10.04(b), in computing such individual or aggregate amounts of claims, the amount of each claim shall take into account any insurance proceeds or other monetary compensation recovered or recoverable by the indemnified party.  In no event shall any party be liable for indemnification hereunder in an amount exceeding 50% of the Non-Inventory Purchase Price; and

                        (iv)       Notwithstanding the foregoing, the limitations set forth in this Section 10.04(b) shall not apply to (A) any breaches of Sections 4.02, 4.06, 5.02, 5.06 and 5.21, (B) any intentional misrepresentation or gross negligence on the part of an indemnifying party or (C) any claims arising under or governed by Section 12.01.

            (c)        Mitigation of Damages.  The party entitled to indemnification shall take all reasonable steps to mitigate all indemnifiable liabilities and damages upon and after becoming aware of any event which could reasonably be expected to give rise to any liabilities and damages that are indemnifiable hereunder.

            Section 10.05   Notice.  Promptly and in no event later than ten (10) business days after acquiring knowledge of any damage, loss, deficiency, liability, claim, encumbrance, penalty, cost, assessment, audit, judgment, or claim against which Seller has agreed to indemnify Buyer or against which Buyer has agreed to indemnify Seller, Seller or Buyer, as the case may be, will give to the other party written notice thereof in the manner set forth in Section 14.01;

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provided, that the failure by any party to provide such notice shall not impair such party's rights to indemnification hereunder, except to the extent the indemnified party is prejudiced.

            Section 10.06   Third Party Claims.  With respect to each third party claim subject to this Article X (a "Third Party Claim"), the party seeking indemnification (the "Indemnified Party") shall give prompt notice to the indemnifying party (the "Indemnifying Party") of the Third Party Claim in accordance with Section 10.05.  The Indemnifying Party, at its sole cost and expense, may, upon notice to the Indemnified Party within ten (10) days after the Indemnifying Party receives notice of the Third Party Claim, assume the defense of the Third Party Claim.  If it assumes the defense of a Third Party Claim then the Indemnifying Party shall select counsel of its choosing to conduct the defense.  The Indemnifying Party shall not consent to a settlement of, or the entry of any judgment arising from, any Third Party Claim, (i) unless the settlement or judgment is solely for money damages and/or such equitable relief as would not have a material adverse effect on the Indemnified Party or (ii) the Indemnified Party consents thereto, which consent shall not be unreasonably withheld.  The Indemnified Party shall be entitled to participate in the defense of any Third Party Claim, the defense of which is assumed by the Indemnifying Party, with its own counsel and at its own expense.  If the Indemnifying Party does not elect to assume the defense of any Third Party Claim in accordance with the terms of this Section 10.06, then the Indemnified Party shall be entitled to conduct its own defense of the Third Party Claim.  Notwithstanding anything to the contrary, under no circumstances shall the Indemnifying Party be liable to the Indemnified Party for the costs of multiple counsel to the Indemnified Party.  The parties shall cooperate in the defense of any Third Party Claim and the relevant records of each party shall be made available on a timely basis.

ARTICLE XI

CONDUCT OF THE PARTIES AFTER CLOSING

            Section 11.01   Cooperation.  Buyer and Seller will cooperate after the Effective Time for each Store in effecting the orderly transfer of the Purchased Assets at the applicable Store to Buyer.  Without limiting the generality of the foregoing, Seller, at the request of Buyer without additional consideration, will execute and deliver from time to time such further instruments of assignment, conveyance and transfer reasonably requested by Buyer, will sign any documents reasonably necessary to ensure that, pursuant to the terms of this Agreement, all of the right, title and interest in and to the Purchased Assets, the Leases, and the New Leases vests in Buyer, will cooperate to all reasonable extents in the conduct of litigation and the processing and collection of insurance claims, and will take such other actions as may reasonably be required to convey and deliver more effective to Buyer the Purchased Assets and the Leases and the New Leases or to confirm and perfect Buyer's title thereto, as contemplated by this Agreement.  In addition, except as otherwise provided in this Agreement, Seller agrees to take all reasonable action in order to enforce any rights it has against any third parties related to the transactions contemplated by this Agreement.

            Section 11.02   Access to Books and Records.  As long as Buyer retains the books and records of Seller's business acquired by Buyer hereunder, it will provide Seller with reasonable access during customary business hours to such books and records for any non-competitive purpose and as long as Seller retains the books and records of Seller's business retained by Seller hereunder, Seller will provide Buyer with reasonable access during customary

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business hours to such books and records for any non-competitive purpose.  Prior to the disposal of any such books and records by any party hereto, such party shall use commercially reasonable efforts to provide sixty (60) days' prior written notice to the other party and shall relinquish possession of such books and records to such other party upon receipt of a written request therefor within the sixty (60) day time period.

            Section 11.03   Licenses.  Buyer will promptly apply for the appropriate DEA licenses, Board of Pharmacy permits, and Ohio Division of Liquor Control permits and agency contracts, for use at the Assumed Lease Stores and the Owned Stores.  Subject to the approval of the applicable authorities, Seller agrees to: (a)  permit Buyer to operate at the Assumed Lease Stores and the Owned Stores under Seller's DEA license and Board of Pharmacy permits from the Effective Time for such Store until the earlier of (i) twelve weeks after the Effective Time for such Store, or (ii) such time as the licenses and permits have been issued pursuant to Buyer's applications therefore; and (b) if the  alcohol inventory cannot be transferred  as of the Applicable Effective Time and must be delayed until Buyer obtains the requisite permits  and agency agreements, permit Buyer to operate the Assumed Lease Stores and the Owned Stores under Seller's applicable permits and agency contracts from the Ohio Division of Liquor Control pursuant to management agreements mutually agreeable to the parties; provided, however, that for both (a) and (b) above, Buyer shall indemnify and hold harmless Seller against all liabilities of Seller arising from Buyer's operation under Seller's DEA licenses and Board of Pharmacy permits, the use of any of the powers granted under the Powers of Attorney attached hereto, and Buyer's operation under the Seller's permits and agency contracts from the Ohio Division of Liquor Control.  The foregoing indemnification obligation of the Buyer shall survive the closing of the transactions contemplated by this Agreement until the expiration of all applicable statutes of limitations.  At the Effective Time for each Store, Seller shall provide the Buyer with all applicable Powers of Attorney required to be provided pursuant to applicable DEA regulations in connection with the Buyer's purchase of the Inventory which shall be substantially in the form of Exhibit G attached hereto. Buyer and Seller acknowledge and agree that the limitations of indemnity contained in Section 10.04 shall have no application to the indemnity provided by this Section 11.03.

            Section 11.04   Access to Prescription Files.  In the event Seller must re-file a third party claim for a third party prescription sale reimbursement, or, if for any other noncompetitive business purpose, Seller requires access to the Prescription Files, the Buyer will provide authorized representatives of Seller reasonable access after the Effective Time for the applicable Store, at mutually agreeable times during normal business hours, to such Prescription Files.  Any such review shall be conducted so as not to interfere with Buyer's normal business activities.  

            Section 11.05   Non-Competition; Non-Solicitation.

            (a)        During the Restrictive Period, Seller will not, and shall cause its Affiliates to not, directly or indirectly (including as a member, agent, shareholder or investor of any Person or in any other capacity), either alone or in conjunction with any other Person, (i) in any manner participate or engage in the ownership, management, operation, or control of, form, acquire, invest in, finance, own, operate, manage, join, assist, support, or provide products or services to or for, or provide financial or other assistance to a Restricted Business in the Restricted Territory (as hereinafter defined), (ii) have any direct or indirect ownership interest in

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(other than through the ownership of 10% or less of any class of securities registered on a recognized stock exchange or dealer quotation system provided the applicable Person does not otherwise participate in the activities of such Person) a Person that operates a Restricted Business in the Restricted Territory, (iii) knowingly permit such Seller's or its Affiliate's name, including "The Pharm" or any part, combination or derivation thereof, to be used in connection with or otherwise knowingly lend assistance (financial or otherwise) to any Person, in each case in any Restricted Business in the Restricted Territory or (iv) induce or attempt to induce, or assist anyone else to induce or attempt to induce, any customer  within the Restricted Territory to reduce or discontinue its business or solicit, divert, take away, or attempt to solicit, divert, or take away any trade, clients, customers, business, or goodwill or otherwise compete for accounts or personnel within the Restricted Territory;

            (b)        With respect to each of the File Buy Stores, Seller shall not, and shall ensure that none of its Affiliates shall, enter into any sublease under nor make an assignment of the Lease applicable to a File Buy Store if such sublease or assignment would, or could reasonably be expected to, result in a breach of any of the restrictive covenants set forth in this Section 11.05.

            (c)        For purposes of this Section 11.05:

                        (i)         "Restricted Business" means any retail pharmacy, long term care (including assisted living) or any other business or enterprise that requires a license from the Ohio Board of Pharmacy;

                        (ii)        "Restrictive Period" means the period beginning at the latest Effective Time for any Store hereunder and continuing for a period of five (5) years; and

                        (iii)       "Restricted Territory" means (A) anywhere within a ten (10) mile radius of Stores 6112 and 6123; and (B) anywhere within a five (5) mile radius of any of the other Stores.

            (d)        If any provision contained in this Section 11.05 will for any reason be held invalid, illegal or unenforceable in any respect, such invalidity, illegality or unenforceability will not affect any other provisions of this Section 11.05, but this Section 11.05 will be construed as if such invalid, illegal or unenforceable provision had never been contained herein.  It is the intention of the Parties that if any of the restrictions or covenants contained in this Section 11.05 is held to cover a geographic area or to be of a length of time which is not permitted by applicable Legal Requirements, or in any way construed to be too broad or to any extent invalid, such provision will not be construed to be null, void and of no effect.  Instead, the Parties agree that a court of competent jurisdiction will construe, interpret, reform or judicially modify this Section 11.05 to provide for a covenant having the maximum enforceable geographic area, time period and other provisions (not greater than those contained herein) as will be valid and enforceable under such applicable Legal Requirements.

            (e)        The Seller agrees that a violation of this Section 11.05 will cause irreparable injury to the Buyer, and the Buyer will be entitled, in addition to any other rights and remedies it may have at law or in equity, to apply for an injunction enjoining and restraining the

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Seller or its Affiliates from doing or continuing to do any such act and any other violations or threatened violations of this Section 11.05, and the Seller consents to the entry thereof.  In the event that the Seller or any of its Affiliates is found to have breached any covenant in this Section 11.05 the time period provided for in that covenant shall be tolled (i.e., it shall not run) for so long as the Seller was in violation of that covenant.

            (f)         Notwithstanding the restrictions set forth in this Section 11.05, Seller and its Affiliates shall have the ability to (and such actions shall not constitute a violation of this Section 11.05), during the Restrictive Period: (i) distribute on a wholesale basis grocery, pharmacy, drug and related products to any current or future retail store customer (who is not an Affiliate of Seller) in the Restricted Territory or which subsequently locates in the Restricted Territory (other than, during the Restricted Period, pharmaceutical products to retail store customers that subsequently locate in a File Buy Store); (ii) operate each of the File Buy Stores, without pharmacy operations, for a period not to exceed ninety (90) days after the Effective Time for such Store to allow for the sell-down of the Excluded Inventory; (iii)  if the New Lease for any Owned Store or Owned Real Property has expired or otherwise been terminated for any reason other than the landlord's default or due to a casualty and/or condemnation under the express terms of such New Lease, lease or sell any such Owned Store and Owned Real Property for any purpose whatsoever or operate any business whatsoever at any such Owned Store or Owned Real Property; (iv) if Buyer's right to occupancy at a Store at which the Buyer has assumed the Lease is terminated such that Seller is held liable by such landlord thereunder for any remaining term, Seller may thereafter lease or sublease such property for any purpose whatsoever or operate any business whatsoever at any such Store, (v) lease or sell, all or part of, the Maumee warehouse complex that Seller and/or its Affiliates currently own for any distribution or warehousing purpose whatsoever; and/or (vi) acquire any Person or the assets of any Person that conducts a Restricted Business within the Restricted Area if in the calendar year prior to the acquisition, the revenues of the acquired Person or the revenues of the acquired assets of the Person from pharmacy sales do not constitute more than 20% of the total revenues of the acquired Person or the acquired assets of the Person.   The parties acknowledge and agree that if Seller or its Affiliates acquire a Person in compliance with subsection (vi) above, that Seller or such Affiliate may continue to operate any Restricted Business as part of the acquired Person without violating this Section 11.05, but may not (x) start up an in-store Restricted Business in the Restrictive Period with respect to such acquired Person or assets if one did not exist at the time of such acquisition or (y) acquire another pharmacy operation (including the purchase of prescription files only) and move such operations or prescription files to such location.

            Section 11.06   Signage.  Following the Effective Time for each Store, Buyer shall be entitled, at its expense, to remove and dispose of all signage from the interior and the exterior of such Assumed Lease Stores and the Owned Stores. With respect to the File Buy Stores, Seller shall permit Buyer, seven (7) days prior to the Effective Time for such Store to place a sign at each of the following locations advising customers that the prescription files will be transferred to a specified location of Buyer: (i) the front entrance, (ii) drive-thru locations (as applicable), and (iii) within each Store's pharmacy department.

            Section 11.07   Use of Pharmacy Systems.  The Seller and the Buyer shall cooperate in an attempt to complete a file conversion of the Seller's pharmacy records to Buyer's pharmacy

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computer system utilizing an outside service.  The outside service's charges shall be the responsibility of the Buyer. 

            Section 11.08   Protected Health Information.  In the event that the file conversion cannot be reasonably accomplished prior to the Effective Time with respect to a Store or less than all years of pharmacy records that are required to be kept by Legal Requirements are converted prior to the Effective Time with respect to a Store, then as of the applicable Effective Time for such Store, Seller will provide  Buyer with a hard copy printout (or computer disk) of the patients' prescription history for the last two years.  Within two (2) days after the Effective Time with respect to each such Store, Seller shall provide Buyer with a supplemental printout of patient histories for all prescriptions filled from the time of printing the foregoing hard copy printout to the official close of business of each Store.

            Section 11.09   HIPAA Privacy Standards.  After the Effective Time for each Store, Buyer shall use commercially reasonable efforts to make Seller's Prescription Files and records available for access to patients and disclosure to other authorized third parties in accordance with the HIPAA privacy standards (hereinafter "HIPAA Privacy Standards") and other applicable Legal Requirements. The Seller acknowledges and agrees that notwithstanding the foregoing, Buyer shall not assume any legal obligations of the Seller under the HIPAA Privacy Standards relating to uses and disclosures of protected health information made prior to the Effective Time with respect to the applicable Store.  All inquiries relating to patient rights under HIPAA Privacy Standards relating to uses or disclosures of health information made prior to the Effective Time for the applicable Store shall be forwarded to Seller or its designated agent for handling.

            Section 11.10   Confidential Information.  The parties covenant and agree that each shall not and that each shall use reasonable efforts to ensure that its Affiliates do not, divulge to any Person any Confidential Information of the other party, the Purchased Assets and the Stores. For purposes of this Agreement, "Confidential Information" means, with respect to any Person, information regarding such Person that is not previously disclosed to the public or to the trade and includes information regarding, facilities, strategies, methods, trade secrets and other intellectual property, software, systems, procedures, operational policies, manuals, confidential reports, product price lists, pricing and cost policies, customer lists, inventory information, financial information (including revenue, costs or profits of the disclosing party), business plans, prospects, or opportunities; and "Person" means any natural person, corporation, general partnership, limited partnership, limited liability company, proprietorship, other business organization, trust, union, joint venture, association, whether or not a legal entity, and any Governmental Body.

            Section 11.11   Further Assurances.  The parties agree to take all steps and shall execute and deliver to other party such instruments as the parties may reasonably request or as may be otherwise necessary to more effectively consummate the transactions contemplated by this Agreement.

            Section 11.12   Remittance.  The parties agree that (a) in the event Buyer receives payment from any parties for services rendered by Seller before the Effective Time with respect to the Stores (including payment from Medicare and Medicaid programs), Buyer will remit such payment to Seller as soon as reasonably practicable after receipt thereof promptly, and (b) in the

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event Seller receives payment from any parties for services rendered by Buyer after the Effective Time with respect to the Stores (including payment from Medicare and Medicaid programs), Seller will promptly remit such payment to Buyer as soon as reasonably practicable after receipt thereof. 

            Section 11.13   Taxes.  Subject to any prorations specifically set forth in this Agreement, Seller shall be liable for and shall pay all taxes (whether assessed or unassessed) applicable to the Purchased Assets, in each case attributable to periods (or portions thereof) ending prior to the Effective Time for such Purchased Asset.  Buyer shall be liable for and shall pay all Taxes (whether assessed or unassessed) applicable to the Stores or the Purchased Assets, in each case attributable to periods (or portions thereof) beginning on or after the Effective Time for such Purchased Asset.  Notwithstanding the foregoing, any tax (including a sales tax, use tax, real property transfer or gains tax, or documentary stamp tax) attributable to the sale or transfer of the Purchased Assets shall be paid by Seller. 

            Section 11.14   Collective Bargaining Matters.  Nothing in this Agreement prohibits or restricts Buyer from setting its own initial terms and conditions of employment for any Employee it determines to hire, including work rules, benefits and salary and wage structure, all as permitted by applicable Legal Requirements.  Seller acknowledges and agrees that Buyer is not obligated to assume any Excluded Obligations with respect to any collective bargaining agreements under this Agreement.  Seller shall be solely liable for any severance payments required to made to Employees due to the consummation of the transactions contemplated by this Agreement and any "effects" bargaining legal obligations of Seller and any obligations resulting or arising therefrom.

            Section 11.15   License.  Seller retains, and Buyer hereby grants to Seller, a perpetual (subject to the temporal restrictions contained in this Section 11.05), royalty-free, fully paid-up irrevocable right (subject to the use restrictions contained in this Section 11.05) and license, which Seller may sublicense to its Affiliates, to use the Marks in connection with the operation by Seller and its Affiliates of their other stores located in Adrian, Michigan and Sandusky Ohio (each a "Remaining Store" and collectively the "Remaining Stores") that currently use the Marks and the File Buy Stores (the Remaining Stores collectively with the File Buy Stores, the "Licensed Stores").  Seller acknowledges and agrees that it shall: (a) not use any of the Marks with respect to any stores other than the Licensed Stores; (b) not transfer this license to any unaffiliated third party; and (c) not use the Marks in connection with the operation of the File Buy Stores after the expiration of the 90 day period following the Effective Time for such File Buy Stores for the sell-off of Excluded Inventory at such File Buy Stores and further agrees that the license granted to each Remaining Store by this Section 11.15 shall automatically be terminated, revoked, and of no further force or effect upon the sale, transfer or closure of such Remaining Store. 

ARTICLE XII

BROKERAGE; EXPENSES

            Section 12.01   Brokerage.  Seller agrees to hold Buyer harmless with respect to any liability for brokerage fees, commissions, finders' fees, or other such fees claimed by any broker, agent, finder, or consultant engaged by Seller in connection with the transactions contemplated

- 37 -

herein.  Buyer agrees to hold Seller harmless with respect to any liability for brokerage fees, commissions, finders' fees, or other such fees claimed by any broker, agent, finder, or consultant engaged by Buyer in connection with the transactions contemplated herein.  Buyer and Seller acknowledge and agree that the limitations of indemnity contained in Section 10.04 shall have no application to the indemnity provided by this Section 12.01.

            Section 12.02   Transactional Expenses.  Except as otherwise expressly provided in this Agreement, the parties agree to bear their fees and expenses incident to the negotiation, preparation, execution, delivery and performance hereof including without limitation, the fees and expenses of their counsel, accountants and other experts.

ARTICLE XIII

TERMINATION

            Section 13.01   Termination by Mutual Consent.  On or prior to the Closing, Buyer and Seller may terminate this Agreement by joint execution of an instrument to such effect.  Subject to the provisions of such instrument terminating this Agreement, no party will have any liability to the other party hereunder in the event of any termination of this Agreement pursuant to this Section.

            Section 13.02   Termination Attributable to Default.  If either Buyer, on the one hand, or Seller, on the other hand, breaches any representations or warranties or defaults in the due and timely performance of any covenants or agreements under this Agreement in any material respect that would result in the failure of a condition set forth in Article VIII or IX as applicable, the non-defaulting party may give notice of termination to the defaulting party in the manner provided in Section 14.01.  The notice shall specify with particularity the defaults on which this notice is based.  The termination shall be effective ten (10) business days after service unless the specified defaults have been cured on or before the effective date of termination.  Termination pursuant to this Section shall relieve the non-defaulting party from any obligations under this Agreement but shall not relieve the defaulting party from liability for damages or other available remedies by reason of a knowing or willful breach of this Agreement prior to termination.

            Section 13.03   Termination by Buyer.  Buyer shall have the right to terminate this Agreement in accordance with Article VII of this Agreement.

            Section 13.04   Termination Date.  Either Buyer or Seller may terminate this Agreement if the Closing shall not have occurred  by the Termination Date.  For purposes hereof "Termination Date"  means 11:59 p.m. Eastern Standard Time on that date which is 180 days after the date of this Agreement.

            Section 13.05   Impossibility.  Either Buyer or Seller may terminate this Agreement if the obligations of the other party hereto shall have become incapable of fulfillment and such obligation is not waived by the party to whose benefit such obligation runs; provided, however, that neither party shall have the ability to terminate this Agreement pursuant to this Section 13.05 in the event the applicable obligation cannot be fulfilled as a result of a covenant or agreement of the party seeking to terminate.

- 38 -

            Section 13.06   Results of Termination.  In the event of termination of this Agreement by either Seller or Buyer as provided in this Article XIII, this Agreement shall forthwith become void and there shall be no liability on the part of any party to any other party under this Agreement, except for the provisions of Article XIV, which shall continue in full force and effect following any termination and except that nothing herein shall relieve any party from liability for any knowing or willful breach of this Agreement prior to such termination.

            Section 13.07   No Termination after Kick-Off Date.  Notwithstanding anything to the contrary contained in this Agreement, Buyer shall not have the right to terminate this Agreement after the Kick-Off Date pursuant to the provisions of Article VII or Section 13.03, or pursuant to any other provision in this Agreement based on the covenants and agreements set forth in Article VII.  The foregoing notwithstanding, Seller acknowledges and agrees that neither the forgoing nor anything else in this Agreement alters, amends or negates Buyers rights and ability to exclude a given Store (including the Purchased Assets located at such Store and, to the extent applicable, the Lease for such Store) from the scope of this Agreement pursuant to and in accordance with the provisions of any or all as the case may be, of Section 7.02, Section 7.03, and Section 7.04.

ARTICLE XIV

MISCELLANEOUS

            Section 14.01   Notices.  All notices, requests, demands and other communications hereunder shall be in writing and will be deemed given if delivered either personally or by sending a copy thereof by fax (facsimile) transmission or by telex or (with answer back received), and confirmed by express mail sent via recognized overnight courier, all charges prepaid, to such party's address (or to such party's telex or fax number).  Notices will be deemed to have been given to the person entitled thereto when received.

If to Seller:

	
 
	
Spartan Stores, Inc.

850 76th Street, S.W., P.O. Box 8700

Grand Rapids, Michigan 49518

	
 
	
 

	
 
	
Facsimile No.:  (616) 878-8287

Attn:  Alex DeYonker, Executive Vice President General Counsel

With a copy to:

	
 
	
Warner Norcross & Judd LLP

900 Fifth Third Center

111 Lyon Street

Grand Rapids, Michigan 49503

Facsimile No.:  (616) 222-2425

Attn:  Gregory E. Schmidt

- 39 -

If to Buyer:

	
 
	
Rite Aid of Ohio, Inc.

P.O. Box 3165

Harrisburg, Pennsylvania 17105

Facsimile No.:  (717) 975-5952

Attn:  I. Lawrence Gelman, Vice President

With a copy to:

	
 
	
Miller, Canfield, Paddock and Stone, PLC

101 North Main St. 7th Floor

Ann Arbor, Michigan 48104

Facsimile No.:  (734) 747-7147

Attn:  Joseph M. Fazio

With a copy to:

	
 
	
Rite Aid of Ohio, Inc.

P.O. Box 3165

Harrisburg, Pennsylvania 17105

Facsimile No.:  (717) 975-5952

Attn:  Lisa M. Winnick, Associate Counsel

With a copy to:

	
 
	
Rite Aid of Ohio, Inc.

5400 Perry Drive

Waterford, Michigan 48329

Facsimile No.:  (248) 674-2687

Attn:  Laura A. Shaw, Vice President Pharmacy Acquisitions

            Section 14.02   Assignability and Parties in Interest.  No party may assign any of its rights or delegate any of its obligations hereunder without the prior written consent of the other party.  This Agreement binds, inures to the benefit of and is enforceable by the respective successors and permitted assigns of the parties and it does not confer any rights on any other persons or entities.

            Section 14.03   Governing Law.  This Agreement will be governed by, and construed and enforced in accordance with the laws of the State of Michigan, without giving effect to its conflicts of laws provisions.

            Section 14.04   Counterparts.  This Agreement may be executed in any number of counterparts and any party hereto may execute any such counterpart, each of which when executed and delivered will be deemed to be an original and all of which counterparts taken together will constitute but one and the same instrument.  The execution of this Agreement by

- 40 -

any party hereto will not become effective until counterparts hereof have been executed by all the parties hereto.  It will not be necessary in making proof of this Agreement of any counterpart hereof to produce or account for any of the other counterparts.

            Section 14.05   Waiver.  The failure of any party to insist upon strict performance of any of the terms or conditions of this Agreement will not constitute a waiver of any of its rights hereunder.

            Section 14.06   Publicity.  Buyer and Seller agree that press releases and other public disclosures to be made by either of them with respect to the transactions contemplated hereby may only be made upon the agreement of the parties and the content will be subject to mutual agreement, except as may be required by law upon the advice of counsel; provided however, both parties shall respond promptly and comment on any such press release and other public document so such releases may be made in a prompt manner.  Notwithstanding the foregoing, (a) each of the parties hereto may respond to inquiries relating to this Agreement and the transactions contemplated hereby by the press, employees or customers without any notice to or further consent of the other party with general statements regarding the transaction and (b) Seller or its Affiliates shall be entitled to file or furnish to the Securities Exchange Commission any documents or disclosures (including Form 8-K) it reasonably believes to be required by applicable Legal Requirements provided any press release shall nonetheless be subject to the provisions of the first sentence of this Section 14.06.

            Section 14.07   Complete Agreement.  This Agreement, the Confidentiality Agreement, and the Exhibits and Schedules hereto delivered pursuant to this Agreement contain the entire agreement between the parties hereto with respect to the transactions contemplated herein and, except as provided herein, supersede all previous oral and written and all contemporaneous oral negotiations, commitments, writings and understandings relating to the subject matter hereof.  Other than as provided in Section 14.08 hereof, this Agreement may not be amended except by an agreement in writing executed by both parties.

            Section 14.08   Modifications, Amendments and Waivers.  At any time prior to the consummation of the transactions hereunder or termination of this Agreement, Buyer, on the one hand, and Seller, on the other hand, may, by written agreement:

                        (a)        extend the time for the performance of any of the obligations or other acts of the other party hereto;

                        (b)        waive any inaccuracies in the representations and warranties made by the other party contained in this Agreement or in the Exhibits or Schedules hereto or any other document delivered pursuant to this Agreement; and

                        (c)        waive compliance with any of the covenants or agreements of the other party contained in this Agreement.

            Section 14.09   Interpretation.  The headings contained in this Agreement are for reference purposes only and will not affect in any way the meaning or interpretation of this Agreement.

- 41 -

            Section 14.10   Severability.  If any provision of this Agreement is held illegal, invalid, or unenforceable, such illegality, invalidity, or unenforceability will not affect any other provision hereof.  This Agreement will, in such circumstances, be deemed modified to the extent necessary to render enforceable the provisions hereof.

            Section 14.11   Time of Essence.  The parties to this Agreement acknowledge and agree that, except with respect to immaterial matters that are ministerial in nature, time is of the essence with respect to the consummation of the transactions contemplated by this Agreement.

            Section 14.12   Gender, Number, Knowledge.  Words of gender may be read as masculine, feminine, or neuter, as required by context. Words of number may be read as singular or plural, as required by context.  All terms such as "herein," "hereby" or "hereunder" refer to this Agreement as a whole.  For purposes of this Agreement, "Knowledge" and terms of similar import means: with respect to Seller,  the actual knowledge of the following individuals:  David M. Staples and Alex J. DeYonker; and with respect to Buyer, the actual knowledge of the following individuals:   I. Lawrence Gelman, Esq. and Laura Shaw.

            Section 14.13   Exhibits and Schedules.  Each Exhibit and Schedule referred to herein is incorporated into this Agreement by such reference.

            Section 14.14   No Benefit to Others.  The representations, warranties, covenants and agreements contained in this Agreement are for the sole benefit of the parties hereto and their successors and permitted assigns, and they will not be construed as conferring and are not intended to confer any rights on any other persons.

[Signature pages to follow] 

- 42 -

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

	
"SELLER"
	
 
	
"BUYER"

	
 
	
 
	
 

	
SEAWAY FOOD TOWN, INC.
	
 
	
RITE AID OF OHIO, INC.

	
 
	
 
	
 

	
 
	
 
	
 

	
By:
	
 

	
 
	
By:
	
 

	
 
	
 
	
 
	
 
	
 

	
Name:
	
 

	
 
	
Name:
	
 

	
 
	
 
	
 
	
 
	
 

	
Title:
	
 

	
 
	
Title:
	
 

	
 
	
 
	
 

	
 
	
 
	
 

	
 
	
 
	
 

	
SPARTAN PROPERTIES MANAGEMENT,

INC.
	
 
	
RITE AID CORPORATION

	
 
	
 
	
 

	
 
	
 
	
 

	
By:
	
 

	
 
	
By:
	
 

	
 
	
 
	
 
	
 
	
 

	
Name:
	
 

	
 
	
Name:
	
 

	
 
	
 
	
 
	
 
	
 

	
Title:
	
 

	
 
	
Title:
	
 

	
 
	
 
	
 

	
 
	
 
	
 

	
 
	
 
	
 

	
THE PHARM OF MICHIGAN, INC.
	
 
	
SPARTAN STORES, INC.

	
 
	
 
	
 

	
 
	
 
	
 

	
By:
	
 

	
 
	
By:
	
 

	
 
	
 
	
 
	
 
	
 

	
Name:
	
 

	
 
	
Name:
	
 

	
 
	
 
	
 
	
 
	
 

	
Title:
	
 

	
 
	
Title:
	
 

- 43 -

Amendment No. 1 to Asset Purchase Agreement

                    Amendment No. 1 to Asset Purchase Agreement (this "Amendment"), dated as of April 29, 2008 (the "Effective Date"), by and between Seaway Food Town, Inc., a Michigan Corporation ("Seller") and Rite Aid of Ohio, Inc., an Ohio corporation ("Buyer"). Each of the Seller and the Buyer are sometimes referred to herein as a "Party" and collectively as the "Parties."

W I T N E S S E T H :

                    WHEREAS, on March 31, 2008, Buyer and Seller, inter alia, entered into that certain Asset Purchase Agreement (the "Agreement") pursuant to which the Buyer agreed to purchase, and the Seller agreed to sell, certain assets associated with Seller's business as operated at the Stores; and

                    WHEREAS, in connection with certain operational discussions that have taken place since the date of the Agreement, the Parties desire to affect certain amendments to the Agreement; and

                    WHEREAS, the Seller and Buyer have agreed to certain amendments to the Agreement on the terms and subject to the conditions set forth herein;

                    NOW, THEREFORE, in consideration of the premises and the mutual covenants and provisions hereinafter contained, the parties hereto hereby agree as follows:

                    Section 1.          Defined Terms. Capitalized terms used herein and not defined herein but defined in the Agreement are used herein as defined in the Agreement.

                    Section 2.          Amendment to the Agreement. As of the Effective Date, the Agreement is hereby amended as follows:

          (a)          Section 1.02(n) of the Agreement is hereby amended to strike "ScriptPro robot and" such that the same shall become a part of the Purchased Assets provided that Buyer shall deliver, Incoterms 2000 CPT Seller's dock at the designated location, a new ScriptPro robot (model #200) within thirty (30) days of written demand to a location designated by Seller within the continental United States;

          (b)          The third sentence of Section 2.01(a) is hereby deleted in its entirety and replaced with the following:

"On the Inventory Date, (i) for each Store other than a File Buy Stores, the front end of the Store (other than pharmacy) will not open and will remain closed to business so that an inventory of the non-pharmacy Inventory can take place (and the portion of the sign off sheet will be completed and initialed by each of the parties upon completion of such front-end Inventory) and (ii) for all Stores, the pharmacy operation will open for business at its normal time and remain open

until 6 p.m. prevailing at the location of the Store and inventory of the pharmacy Inventory will commence immediately upon the pharmacy closing for business (the time of commencement of the pharmacy inventory at each Store the "Effective Time" as to such Store)."

          (c)          Section II.A.(b) of Exhibit B is hereby deleted in its entirety and replaced with the following:

(b) the following merchandise categories and cost percentages will be used in valuing the balance of the marketable inventory:

	
Category
	
Cost (% of Seller's Retail)

	
Grocery Non-Foods
	
74%

	
Cigarettes/Tobacco Products
	
80%

	
GM/HBC
	
82%

	
Beer and Wine
	
74%

	
Greeting Cards
	
50%

          (d)          The Store Inventory report attached to and a part of Exhibit B is hereby amended to add the following as a new line immediately below "Beer and Wine" and the information opposite the same and immediately above "(A) Total OTC(FE) INVENTORY COST $__________":

	
 
	
"Greeting Cards
	
Retail $____
	
50%
	
 
	
$______________"

          (e)          Section 1.01(c) of the Agreement is hereby deleted in its entirety and replaced with the following:

"All of Seller's inventory (as defined on Exhibit B hereto) of whatever nature or description located at the Stores at the applicable Effective Time, including but not limited to pharmaceuticals, over-the-counter items, and the like (but not including any Excluded Inventory (as defined on Exhibit B)) but excluding, with respect to Store #6111 (as shown on Exhibit A) all inventory other than pharmaceutical inventory counted and valued in accordance with Exhibit B, provided further, Buyer agrees to reimburse Seller within fifteen (15) days of receipt of supporting documentation for one half (1/2) of the resulting loss, if any, realized by Seller in effecting the sale below Seller's wholesale cost from Store 6111 of that portion of the Inventory at Store 6111, which would have otherwise been purchased by Buyer pursuant to the terms hereof if Store 6111 had been an Assumed Lease Store, but in no event in excess of One Hundred and Fifty Thousand and 00/100 Dollars ($150,000.00). Such loss, if any, below Seller's wholesale cost, shall be calculated as of the date which is two (2) weeks following the Effective Time for Store 6111 and during such two (2) week period, Seller shall be a licensee in Store 6111 without the obligation to pay fixed rent but subject to all other occupancy costs."

          (f)          A new Section 6.12 is added to the Agreement immediately following the current Section 6.11 to read as follows:

6.12 Banners. Seller acknowledges and agrees, Section 6.04 and 14.06 notwithstanding, that, immediately following the Kickoff Date, Buyer shall have the right, but not the obligation, to place banners above the entrance to and signage on no more than two (2) of the windows of each Assumed Lease Store and the Owned Stores reading substantially as follows "Rite Aid Coming Soon."

                    Section 3.          No Other Amendments. Except as specifically modified by this Amendment, the Agreement remains in full force and effect.

                    Section 4.          Governing Law; Counterparts. This Amendment will be governed by, and construed and enforced in accordance with the laws of the State of Michigan, without giving effect to its conflict of laws provisions. This Amendment may be executed in any number of counterparts and any Party hereto may execute any such counterpart, each of which when executed and delivered will be deemed to be an original and all of which taken together with constitute one and the same instrument.

	
Seller
	
 

	
 
	
 

	
SEAWAY FOOD TOWN, INC.
	
 

	
 
	
 

	
 
	
 

	
By:
	
 

	
 

	
 
	
 
	
 

	
Name:
	
 

	
 

	
 
	
 
	
 

	
Its:
	
 

	
 

	
 
	
 

	
 
	
 

	
Buyer
	
 

	
 
	
 

	
RITE AID OF OHIO, INC.
	
 

	
 
	
 

	
 
	
 

	
By:
	
 

	
 

	
 
	
 
	
 

	
Name:
	
 

	
 

	
 
	
 
	
 

	
Its:
	
 

	
 

Amendment No. 2 to Asset Purchase Agreement

                    AMENDMENT NO. 2 to Asset Purchase Agreement (this "Amendment No. 2"), dated as of May 16, 2008 (the "Effective Date"), by and between Seaway Food Town, Inc., a Michigan Corporation ("Seller") and Rite Aid of Ohio, Inc., an Ohio corporation ("Buyer").  Each of the Seller and the Buyer are sometimes referred to herein as a "Party" and collectively as the "Parties."

W I T N E S S E T H :

                    WHEREAS, on March 31, 2008, Buyer and Seller, inter alia, entered into that certain Asset Purchase Agreement (the "Agreement") pursuant to which the Buyer agreed to purchase, and the Seller agreed to sell, certain assets associated with Seller's business as operated at the Stores;

                    WHEREAS, on April 29, 2008, Buyer and Seller entered into Amendment No. 1 to the Agreement ("Amendment No. 1");

                    WHEREAS, in connection with certain operational discussions that have taken place since the date of the Agreement and Amendment No. 1, the Parties desire to effect certain additional amendments to the Agreement; and

                    WHEREAS, the Seller and Buyer have agreed to certain amendments to the Agreement, as amended by Amendment No. 1, on the terms and subject to the conditions set forth herein;

                    NOW, THEREFORE, in consideration of the premises and the mutual covenants and provisions hereinafter contained, the parties hereto hereby agree as follows:

                    Section 1.          Defined Terms.  Capitalized terms used herein and not defined herein but defined in the Agreement are used herein as defined in the Agreement.  Stores are identified by their numbers as set forth on Exhibit A to the Agreement.

                    Section 2.          Amendment to the Agreement.  As of the Effective Date, the  Agreement is hereby amended as follows:

          (a)          Seller and Buyer have agreed to amend and restate Exhibit A to the Agreement to reflect the applicable liquor licenses issued by the Ohio Division of Liquor Control for the Assumed Lease Stores and Store 6108.  The amended and restated Exhibit A is attached to this Amendment.

          (b)          Seller and Buyer agree to increase the Non-Inventory Purchase Price for Store #6111 by the amount of $83,893.00.  Accordingly:

                    (i)          Section 2.01 of the Agreement is hereby amended by deleting "$12,846,000" and replacing the deleted text with "$12,929,893.00";

                    (ii)          Exhibit A attached to this Amendment No. 2 has been amended to incorporate the modifications to the Non-Inventory Purchase Price for Store 6111 as set forth in  Section 2(a), of this Amendment; and

                    (iii)          Section 1.01(c) of the Agreement, as amended by Amendment No. 1, is deleted in its entirety and is replaced with the following:

          All of Seller's inventory (as defined on Exhibit B hereto) of whatever nature or description located at the Stores at the applicable Effective Time, including but not limited to Pharmaceuticals, over-the-counter items, and the like (but not including any Excluded Inventory (as defined on Exhibit B)) but excluding, with respect to the File Buy Stores and Store #6111 (as shown on Exhibit A), all inventory other than pharmaceutical inventory counted and valued in accordance with Exhibit B.   For the two (2) week period beginning on the first day after the Effective Time for Store #6111, Seller shall be a licensee in Store #6111 without the obligation to pay fixed rent but subject to all other occupancy costs.

          (c)          Buyer agrees that Seller may remove the closed circuit television system and digital video recorder from Store #6111 before Seller vacates same pursuant to its License.  Accordingly, Schedule 1.02(r) to the Agreement is hereby amended by deleting "None" and adding the following:

"Closed circuit television system (CCTV) and digital video recorder (DVR) located at Store #6111."

          (d)          Seller and Buyer agree that Buyer shall honor, within the Stores other than the File Buy Stores or Store 6111, all gift certificates issued by Seller following each Store Closing through December 31, 2008.  Accordingly, the Agreement is amended by adding the following Section 11.16:

          Section 11.16 Coupons and Gift Certificates.  For a period commencing with the Store Closing for the applicable Store and continuing through the close of business on December 31, 2008, Buyer shall honor at the Assumed Lease Stores and Store 6108 all gift cards issued by Seller prior to the applicable Store Closing ("Gift Cards") and properly presented to Buyer for redemption.  Buyer shall submit invoices to Seller at the address for Seller set forth in Section 14.01 for the aggregate amount of Gift Cards honored on a weekly basis, except that if the aggregate amount of

Gift Cards honored for any weekly period is less than $1,000, then Buyer shall defer the invoice until the earlier of the end of the next ensuing week or the end of the month.  Each invoice must state the time period covered and the aggregate amount of Gift Cards honored during the period, and must be accompanied by the details of each Gift Card covered by the invoice (or other evidence of Gift Cards so honored).  Seller shall promptly pay, but in no event more than thirty (30) days after receipt of the invoice, each invoice properly submitted with the accompanying Gift Cards or other evidence.

          (e)          Seller and Buyer agree that developed film that has been awaiting customer pickup for 30 days or more as of the Effective Time for each Assumed Lease Store and Store 6108 shall constitute Excluded Inventory.  Accordingly, Schedule I of the Store Inventory Instruction Form attached to Exhibit B to the Agreement is amended by adding the following under Section A:

                    28.          Developed film awaiting customer pick up for 30 days or more as of the Effective Time for such Store.

          (f)          Buyer and Seller agree that Seller will provide register cash in the amount of $1,450.00 at each of Stores #6103, #6104, #6107, #6109, #6110, #6125, and #6108 as of the applicable Store Closing.  Accordingly:

                    (i)          Section 1.02(b) of the Agreement is amended by inserting "Except as set forth in Section 6.13 of this Agreement," immediately preceding "all cash and cash equivalents..."; and

                    (ii)          a new Section 6.13 is added to the agreement immediately following Section 6.12 (which was added by Amendment No. 1) as follows:

          Section 6.13  Register Cash.  Seller shall leave register cash in the amount of $1,450.00 U.S. (the "Register Cash") immediately prior to the Effective Time at each of the following stores: #6103, #6104, #6107, #6109, #6110, #6125, and #6108.  Buyer shall reimburse Seller on a dollar-for-dollar basis for all Register Cash provided by Seller.  The Register Cash shall be identified on the Physical Inventory Valuation Report (as defined on Exhibit B to this Agreement) for each applicable Store.

                    (ii)          Exhibit B to the Agreement is amended by deleting the Physical Inventory Valuation Report and replacing it with the form attached as Exhibit B to this Amendment.

                    Section 3.          No Other Amendments.  Except as specifically modified by this Amendment, the Agreement remains in full force and effect.

                    Section 4.          Governing Law; Counterparts.  This Amendment will be governed by, and construed and enforced in accordance with the laws of the State of Michigan, without giving effect to its conflict of laws provisions.  This Amendment may be executed in any number of counterparts and any Party hereto may execute any such counterpart, each of which when executed and delivered will be deemed to be an original and all of which taken together with constitute one and the same instrument.

Signatures appear on following pages.

          The parties have signed this Amendment as of Effective Date.

	
Seller
	 
	 	 
	
SEAWAY FOOD TOWN, INC.
	 
	 	 
	 	 
	
By:
	 
	 
	 	 	 
	
Name:
	 
	 
	 	 	 
	
Its:
	 
	 
	 	 
	 	 
	
Buyer
	 
	 	 
	
RITE AID OF OHIO, INC.
	 
	 	 
	 	 
	
By:
	 
	 
	 	 	 
	
Name:
	 
	 
	 	 	 
	
Its:ex4-1.htm

    EXHIBIT
4.1

     

    _____________________________________________________________________________________

     

     

    AMENDED
AND RESTATED DECLARATION OF TRUST

     

    among

     

    PRIVATEBANCORP,
INC.,

    as
Sponsor

     

    WILMINGTON
TRUST COMPANY,

    as
Property Trustee

     

    WILMINGTON
TRUST COMPANY,

    as
Delaware Trustee

     

    and

     

    THE
ADMINISTRATIVE TRUSTEES NAMED HEREIN

     

    _____________________________________________________________________________________

     

     

    Dated as
of May 22, 2008

     

    _____________________________________________________________________________________

     

     

    PRIVATEBANCORP
CAPITAL TRUST IV

     

    _____________________________________________________________________________________

     

    

    
      
        
           

        

        
           

          
            

          

        

        
           

        

      

    

    

    Certain
Sections of this Declaration of Trust relating to Sections 310 through
318

    of the
Trust Indenture Act of 1939:

     

    
      	
              
                Trust
      Indenture

                Act
      Section

              

            	 	
              
                Declaration
      of Trust Section

              

            
	 	 	 	 
	
              (§)
      310

            	
              (a)(1)

            	 	
              8.7

            
	 
      	
              (a)(2)

            	 	
              8.7

            
	 
      	
              (a)(3)

            	 	
              8.9

            
	 
      	
              (a)(4)

            	 	
              2.7(a)(ii)

            
	 
      	
              (b)

            	 	
              8.8

            
	
              (§)
      311

            	
              (a)

            	 	
              8.13

            
	 
      	
              (b)

            	 	
              8.13

            
	
              (§)
      312

            	
              (a)

            	 	
              5.8

            
	 
      	
              (b)

            	 	
              5.8

            
	 
      	
              (c)

            	 	
              5.8

            
	
              (§)
      313

            	
              (a)

            	 	
              8.15(a)

            
	 
      	
              (a)(4)

            	 	
              8.15(b)

            
	 
      	
              (b)

            	 	
              8.15(b)

            
	 
      	
              (c)

            	 	
              10.8

            
	 
      	
              (d)

            	 	
              8.15(c)

            
	
              (§)
      314

            	
              (a)

            	 	
              8.16

            
	 
      	
              (b)

            	 	
              Not
      Applicable

            
	 
      	
              (c)(1)

            	 	
              8.17

            
	 
      	
              (c)(2)

            	 	
              8.17

            
	 
      	
              (c)(3)

            	 	
              Not
      Applicable

            
	 
      	
              (d)

            	 	
              Not
      Applicable

            
	 
      	
              (e)

            	 	
              1.1,
      8.17

            
	
              (§)
      315

            	
              (a)

            	 	
              8.1(a),
      8.3(a)

            
	 
      	
              (b)

            	 	
              8.2,
      10.8

            
	 
      	
              (c)

            	 	
              8.1(d)

            
	 
      	
              (d)

            	 	
              8.1,
      8.3

            
	 
      	
              (e)

            	 	
              10.1

            
	 
      	
              (a)

            	 	
              Not
      Applicable

            
	
              (§)
      316

            	
              (a)(1)(A)

            	 	
              8.1(e)(iii)

            
	 
      	
              (a)(1)(B)

            	 	
              5.13(b)

            
	 
      	
              (a)(2)

            	 	
              Not
      Applicable

            
	 
      	
              (b)

            	 	
              5.13

            
	 
      	
              (c)

            	 	
              6.7

            
	
              (§)
      317

            	
              (a)(1)

            	 	
              Not
      Applicable

            
	 
      	
              (a)(2)

            	 	
              Not
      Applicable

            
	 
      	
              (b)

            	 	
              5.10

            
	
              (§)
      318

            	
              (a)

            	 	
              10.10

            

    

    

    Note:  This
reconciliation and tie sheet shall not, for any purpose, be deemed to be a part
of the Declaration of Trust.

    
 

    
      
        
           

        

        
          i

          
            

          

        

        
           

        

      

    

    

    
      	
              ARTICLE I

            	
              DEFINED
      TERMS

            	
              1

            
	
              Section
      1.1

            	
              Definitions

            	
              1

            
	 	 	 
	
              ARTICLE II

            	
              CONTINUATION
      OF THE ISSUER TRUST

            	
              9

            
	
              Section
      2.1

            	
              Name

            	
              9

            
	
              Section
      2.2

            	
              Office
      of the Delaware Trustee; Principal Place of Business

            	
              9

            
	
              Section
      2.3

            	
              Initial
      Contribution of Trust Property; Organizational Expenses

            	
              9

            
	
              Section
      2.4

            	
              Issuance
      of the Preferred Securities

            	
              9

            
	
              Section
      2.5

            	
              Issuance
      of the Common Securities; Subscription and Purchase of
      Debentures

            	
              9

            
	
              Section
      2.6

            	
              Continuation
      of Trust

            	
              10

            
	
              Section
      2.7

            	
              Authorization
      to Enter into Certain Transactions

            	
              10

            
	
              Section
      2.8

            	
              Assets
      of Trust

            	
              13

            
	
              Section
      2.9

            	
              Title
      to Trust Property

            	
              13

            
	 	 	 
	
              ARTICLE III

            	
              PAYMENT
      ACCOUNT

            	
              14

            
	
              Section
      3.1

            	
              Payment
      Account

            	
              14

            
	 	 	 
	
              ARTICLE IV

            	
              DISTRIBUTIONS;
      REDEMPTION

            	
              14

            
	
              Section
      4.1

            	
              Distributions

            	
              14

            
	
              Section
      4.2

            	
              Redemption

            	
              15

            
	
              Section
      4.3

            	
              Subordination
      of Common Securities

            	
              17

            
	
              Section
      4.4

            	
              Payment
      Procedures

            	
              17

            
	
              Section
      4.5

            	
              Tax
      Returns and Reports

            	
              17

            
	
              Section
      4.6

            	
              Payment
      of Taxes, Duties, Etc. of the Issuer Trust

            	
              18

            
	
              Section
      4.7

            	
              Payments
      under Indenture or Pursuant to Direct Actions

            	
              18

            
	
              Section
      4.8

            	
              Liability
      of the Holder of Common Securities

            	
              18

            
	 	 	 
	
              ARTICLE V

            	
              TRUST
      SECURITIES CERTIFICATES

            	
              18

            
	
              Section
      5.1

            	
              Initial
      Ownership

            	
              18

            
	
              Section
      5.2

            	
              The
      Trust Securities Certificates

            	
              18

            
	
              Section
      5.3

            	
              Execution,
      Delivery and Authentication of Trust Securities
    Certificates

            	
              19

            
	
              Section
      5.4

            	
              Book-Entry
      Preferred Securities

            	
              19

            
	
              Section
      5.5

            	
              Registration
      of Transfer and Exchange of Preferred Securities
    Certificates

            	
              21

            
	
              Section
      5.6

            	
              Mutilated,
      Destroyed, Lost or Stolen Trust Securities Certificates

            	
              22

            
	
              Section
      5.7

            	
              Persons
      Deemed Holders

            	
              22

            
	
              Section
      5.8

            	
              Access
      to List of Holders’ Names and Addresses

            	
              22

            
	
              Section
      5.9

            	
              Maintenance
      of Office or Agency

            	
              23

            
	
              Section
      5.10

            	
              Appointment
      of Paying Agent

            	
              23

            
	
              Section
      5.11

            	
              Ownership
      of Common Securities by Sponsor

            	
              23

            
	
              Section
      5.12

            	
              Notices
      to Clearing Agency

            	
              23

            
	
              Section
      5.13

            	
              Rights
      of Holders; Waivers of Past Defaults

            	
              24

            
	 	 	 
	
              ARTICLE VI

            	
              ACTS
      OF HOLDERS; MEETINGS; VOTING

            	
              26

            
	
              Section
      6.1

            	
              Limitations
      on Voting Rights

            	
              26

            
	
              Section
      6.2

            	
              Notice
      of Meetings

            	
              26

            

    

    
 

    
      
        
          
             

          

          
            ii

            
              

            

          

          
             

          

        

      

       

    

    
      	
              Section
      6.3

            	
              Meetings
      of Holders of the Preferred Securities

            	
              27

            
	
              Section
      6.4

            	
              Voting
      Rights

            	
              27

            
	
              Section
      6.5

            	
              Proxies,
      etc

            	
              27

            
	
              Section
      6.6

            	
              Holder
      Action by Written Consent

            	
              27

            
	
              Section
      6.7

            	
              Record
      Date for Voting and Other Purposes

            	
              27

            
	
              Section
      6.8

            	
              Acts
      of Holders

            	
              27

            
	
              Section
      6.9

            	
              Inspection
      of Records

            	
              28

            
	 	 	 
	
              ARTICLE VII

            	
              REPRESENTATIONS
      AND WARRANTIES

            	
              28

            
	
              Section
      7.1

            	
              Representations
      and Warranties of the Property Trustee and the Delaware
      Trustee

            	
              28

            
	
              Section
      7.2

            	
              Representations
      and Warranties of Sponsor

            	
              29

            
	 	 	 
	
              ARTICLE VIII

            	
              THE
      ISSUER TRUSTEES

            	
              30

            
	
              Section
      8.1

            	
              Certain
      Duties and Responsibilities

            	
              30

            
	
              Section
      8.2

            	
              Certain
      Notices

            	
              31

            
	
              Section
      8.3

            	
              Certain
      Rights of Property Trustee

            	
              31

            
	
              Section
      8.4

            	
              Not
      Responsible for Recitals or Issuance of Securities

            	
              33

            
	
              Section
      8.5

            	
              May
      Hold Securities

            	
              33

            
	
              Section
      8.6

            	
              Compensation;
      Indemnity; Fees

            	
              33

            
	
              Section
      8.7

            	
              Corporate
      Property Trustee Required; Eligibility of Issuer Trustees

            	
              34

            
	
              Section
      8.8

            	
              Conflicting
      Interests

            	
              35

            
	
              Section
      8.9

            	
              Co-Trustees
      and Separate Trustee

            	
              35

            
	
              Section
      8.10

            	
              Resignation
      and Removal; Appointment of Successor

            	
              36

            
	
              Section
      8.11

            	
              Acceptance
      of Appointment by Successor

            	
              37

            
	
              Section
      8.12

            	
              Merger,
      Conversion, Consolidation or Succession to Business

            	
              38

            
	
              Section
      8.13

            	
              Preferential
      Collection of Claims Against Sponsor or Issuer Trust

            	
              38

            
	
              Section
      8.14

            	
              Property
      Trustee May File Proofs of Claim

            	
              38

            
	
              Section
      8.15

            	
              Reports
      by Property Trustee

            	
              39

            
	
              Section
      8.16

            	
              Reports
      to the Property Trustee

            	
              39

            
	
              Section
      8.17

            	
              Evidence
      of Compliance with Conditions Precedent

            	
              39

            
	
              Section
      8.18

            	
              Number
      of Issuer Trustees

            	
              39

            
	
              Section
      8.19

            	
              Delegation
      of Power

            	
              39

            
	
              Section
      8.20

            	
              Appointment
      of Administrative Trustees

            	
              40

            
	 	 	 
	
              ARTICLE IX

            	
              TERMINATION,
      LIQUIDATION AND MERGER

            	
              40

            
	
              Section
      9.1

            	
              Dissolution
      Upon Expiration Date

            	
              40

            
	
              Section
      9.2

            	
              Early
      Dissolution

            	
              40

            
	
              Section
      9.3

            	
              Termination

            	
              41

            
	
              Section
      9.4

            	
              Liquidation

            	
              41

            
	
              Section
      9.5

            	
              Mergers,
      Consolidations, Amalgamations or Replacements of Issuer
    Trust

            	
              42

            
	 	 	 
	
              ARTICLE X

            	
              MISCELLANEOUS
      PROVISIONS

            	
              43

            
	
              Section
      10.1

            	
              Limitation
      of Rights of Holders

            	
              43

            
	
              Section
      10.2

            	
              Amendment

            	
              43

            
	
              Section
      10.3

            	
              Separability

            	
              44

            

    

     

    
      

      
        
          
             

          

          
            iii

            
              

            

          

          
             

          

        

      

       

    

    
      	
              Section
      10.4

            	
              Governing
      Law

            	
              44

            
	
              Section
      10.5

            	
              Payments
      Due on Non-Business Day

            	
              44

            
	
              Section
      10.6

            	
              Successors

            	
              45

            
	
              Section
      10.7

            	
              Headings

            	
              45

            
	
              Section
      10.8

            	
              Reports,
      Notices and Demands

            	
              45

            
	
              Section
      10.9

            	
              Agreement
      Not to Petition

            	
              45

            
	
              Section
      10.10

            	
              Trust
      Indenture Act; Conflict with Trust Indenture Act

            	
              46

            
	
              Section
      10.11

            	
              Acceptance
      of Terms of Declaration of Trust, Guarantee Agreement and
      Indenture

            	
              46

            
	
              Section
      10.12

            	
              Counterparts

            	
              46

            

    

    

    

    
      	
              Exhibit A

            	
              Certificate
      of Trust

            
	
              Exhibit B

            	
              Form
      of Common Securities Certificate

            
	
              Exhibit C

            	
              Form
      of Expense Agreement

            
	
              Exhibit D

            	
              Form
      of Preferred Securities Certificate

            

    

    

    

    
      
        
           

        

        
          iv

          
            

          

        

        
           

        

      

    

    

    
      AMENDED
AND RESTATED DECLARATION OF TRUST, dated as of May 22, 2008, among
PRIVATEBANCORP, INC., a Delaware corporation (including any successors or
assigns, the “Sponsor”), WILMINGTON TRUST
COMPANY, as property trustee (in such capacity, the “Property Trustee”),
WILMINGTON TRUST COMPANY, as Delaware trustee (in such capacity, the “Delaware Trustee”), Larry D.
Richman, an individual, Dennis L. Klaeser, an individual, and Christopher J.
Zinski, an individual, each of whose address is c/o PrivateBancorp, Inc., 70
West Madison, Suite 900, Chicago, Illinois 60602 (each an “Administrative Trustee” and
collectively the “Administrative Trustees”)
(the Property Trustee, the Delaware Trustee and the Administrative Trustees
being referred to collectively as the “Issuer Trustees”), and the
several Holders, as hereinafter defined.

       

      W I T N E
S S E T H:

       

      WHEREAS, the Sponsor and the
Issuer Trustees have heretofore duly declared and established a statutory trust
under the name “PrivateBancorp Capital Trust IV” pursuant to the Delaware
Statutory Trust Act by entering into the Declaration of Trust, dated as of
May 1, 2008 (the “Original Declaration of
Trust”), and by the execution and filing by the Issuer Trustees with the
Secretary of State of the State of Delaware of the Certificate of Trust, filed
on May 1, 2008, attached as Exhibit A;

       

      WHEREAS, the parties hereto
desire to amend and restate the Original Declaration of Trust in its entirety as
set forth herein to provide for, among other things, (i) the issuance of
the Common Securities by the Issuer Trust to the Sponsor, (ii) the issuance
and sale of the Preferred Securities by the Issuer Trust pursuant to the
Underwriting Agreement, (iii) the acquisition by the Issuer Trust from the
Sponsor of all of the right, title and interest in the Debentures, and (iv) the
appointment of the Issuer Trustees;

       

      NOW THEREFORE, in
consideration of the agreements and obligations set forth herein and for other
good and valuable consideration, the receipt and sufficiency of which is hereby
acknowledged, each party, for the benefit of the other parties and for the
benefit of the Holders, hereby amends and restates the Original Declaration of
Trust in its entirety and agrees as follows:

       

      ARTICLE I

       

      DEFINED
TERMS

       

      Section
1.1                                Definitions.  For
all purposes of this Declaration of Trust, except as otherwise expressly
provided or unless the context otherwise requires:

       

      (a)           The
terms defined in this Article have the meanings assigned to them in this
Article, and include the plural as well as the singular;

       

      (b)           All
other terms used herein that are defined in the Trust Indenture Act, either
directly or by reference therein, have the meanings assigned to them
therein;

       

      (c)           The
words “include”, “includes” and “including” are deemed to be followed by the
phrase “without limitation”;

       

      (d)           All
accounting terms used but not defined herein have the meanings assigned to them
in accordance with United States generally accepted accounting
principles;

       

      (e)           Unless
the context otherwise requires, any reference to an “Article”, a “Section” or an
“Exhibit” refers to an Article, a Section or an Exhibit, as the case may be, of
or to this Declaration of Trust; and

       

      
        
           

        

        
           

          
            

          

        

        
           

        

      

      (f)           The
words “hereby”, “herein”, “hereof” and “hereunder” and other words of similar
import refer to this Declaration of Trust as a whole and not to any particular
Article, Section or other subdivision.

       

      “Act” has the meaning
specified in Section 6.8.

       

      “Additional Amount” means,
with respect to Trust Securities of a given Liquidation Amount and/or a given
period, the amount of Additional Interest (as defined in the Indenture) paid by
the Sponsor on a Like Amount of Debentures for such period.

       

      “Additional Sums” has the
meaning specified in Section 10.6 of the Indenture.

       

      “Administrative Trustee” means
each of the Persons appointed in accordance with Section 8.20 solely in
such Person’s capacity as Administrative Trustee of the Issuer Trust and not in
such Person’s individual capacity, or any successor Administrative Trustee
appointed as herein provided.

       

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

       

      “Applicable Procedures” means,
with respect to any transfer or transaction involving a Book-Entry Preferred
Security, the rules and procedures of the Clearing Agency for such Book-Entry
Preferred Security, in each case to the extent applicable to such transaction
and as in effect from time to time.

       

      “Bankruptcy Event” means, with
respect to any Person:

       

      (a)           the
entry of a decree or order by a court having jurisdiction in the premises
judging such Person a bankrupt or insolvent, or approving as properly filed a
petition seeking reorganization, arrangement, adjudication or composition of or
in respect of such Person under any applicable Federal or State bankruptcy,
insolvency, reorganization or other similar law, or appointing a receiver,
liquidator, assignee, trustee, sequestrator (or other similar official) of such
Person or of any substantial part of its property or ordering the winding up or
liquidation of its affairs, and the continuance of any such decree or order
unstayed and in effect for a period of 60 consecutive days; or

       

      (b)           the
institution by such Person of proceedings to be adjudicated a bankrupt or
insolvent, or the consent by it to the institution of bankruptcy or insolvency
proceedings against it, or the filing by it of a petition or answer or consent
seeking reorganization or relief under any applicable Federal or State
bankruptcy, insolvency, reorganization or other similar law, or the consent by
it to the filing of any such petition or to the appointment of a receiver,
liquidator, assignee, trustee, sequestrator (or similar official) of such Person
or of any substantial part of its property, or the making by it of an assignment
for the benefit of creditors, or the admission by it in writing of its inability
to pay its debts generally as they become due or its willingness to be
adjudicated a bankrupt, or the taking of corporate action by such Person in
furtherance of any such action.

       

      “Bankruptcy Laws” has the
meaning specified in Section 10.9.

       

      “Board of Directors” means
either the board of directors of the Sponsor or any committee of that board duly
authorized to act hereunder.

       

      
        
           

        

        
          2

          
            

          

        

        
           

        

      

      “Board Resolution” means a
copy of a resolution certified by the Secretary or an Assistant Secretary of the
Sponsor to have been duly adopted by the Board of Directors, or such committee
of the Board of Directors or officers of the Sponsor to which authority to act
on behalf of the Board of Directors has been delegated, and to be in full force
and effect on the date of such certification, and delivered to the Issuer
Trustees.

       

      “Book-Entry Preferred Securities
Certificate” means a Preferred Securities Certificate evidencing
ownership of Book-Entry Preferred Securities.

       

      “Book-Entry Preferred
Security” means a Preferred Security, the ownership and transfers of
which shall be made through book entries by a Clearing Agency as described in
Section 5.4.

       

      “Business Day” means any day
other than a Saturday, Sunday, or any other day on which banking institutions
and trust companies in New York, New York, Wilmington, Delaware or Chicago,
Illinois, are permitted or required by any applicable law to close.

       

      “Certificate Depository
Agreement” means the agreement among the Issuer Trust, the Sponsor and
DTC, as the initial Clearing Agency, dated as of the Closing Date.

       

      “Clearing Agency” means an
organization registered as a “clearing agency” pursuant to Section 17A of
the Securities Exchange Act of 1934, as amended.  DTC will be the
initial Clearing Agency.

       

      “Clearing Agency Participant”
means a broker, dealer, bank, other financial institution or other Person for
whom from time to time a Clearing Agency effects book-entry transfers and
pledges of securities deposited with the Clearing Agency.

       

      “Closing Date” has the meaning
given to such term in the Underwriting Agreement, which date is also the date of
execution and delivery of this Declaration of Trust.

       

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

       

      “Commission” means the
Securities and Exchange Commission, as from time to time constituted, created
under the Exchange Act, or, if at any time after the execution of this
instrument such Commission is not existing and performing the duties now
assigned to it under the Trust Indenture Act, then the body performing such
duties at such time.

       

      “Common Securities
Certificate” means a certificate evidencing ownership of Common
Securities, substantially in the form attached as Exhibit B .

       

      “Common Security” means a
common undivided beneficial interest in assets of the Issuer Trust, having a
Liquidation Amount of $25.00 and having the rights provided therefor in this
Declaration of Trust, including the right to receive Distributions and a
Liquidation Distribution to the extent provided herein.

       

      “Corporate Trust Office” means
(i) when used with respect to the Property Trustee, the principal office of
the Property Trustee at which at any particular time its corporate trust
business is administered, and (ii) when used with respect to the Debenture
Trustee, the principal office of the Debenture Trustee at which at any
particular time its corporate trust business is administered.

       

      “Debenture Event of Default”
means any “Event of Default” specified in Section 5.1 of the
Indenture.

       

      
        
           

        

        
          3

          
            

          

        

        
           

        

      

      “Debenture Redemption Date”
means, with respect to any Debentures to be redeemed under the Indenture, the
date fixed for redemption of such Debentures under the Indenture.

       

      “Debenture Trustee” means the
Person identified as the “Trustee” in the Indenture, solely in its capacity as
Trustee pursuant to the Indenture and not in its individual capacity, or its
successor in interest in such capacity, or any successor Trustee appointed as
provided in the Indenture.

       

      “Debentures” means the
Sponsor’s 10.00% Junior Subordinated Notes due 2068, issued pursuant to the
Indenture.

       

      “Declaration of Trust” means
this Amended and Restated Declaration of Trust, as the same may be modified,
amended or supplemented in accordance with the applicable provisions hereof,
including (i) all exhibits, and (ii) for all purposes of this
Declaration of Trust and any such modification, amendment or supplement, the
provisions of the Trust Indenture Act that are deemed to be a part of and govern
this Declaration of Trust and any such modification, amendment or supplement,
respectively.

       

      “Definitive Preferred Securities
Certificates” means either or both (as the context requires) of
(i) Preferred Securities Certificates issued as Book-Entry Preferred
Securities Certificates as provided in Section 5.2 or 5.4, and
(ii) Preferred Securities Certificates issued in certificated, fully
registered form as provided in Section 5.2, 5.4 or 5.5.

       

      “Delaware Statutory Trust Act”
means Chapter 38 of Title 12 of the Delaware Code, 12 Del. Code § 3801 et seq.,
as it may be amended from time to time.

       

      “Delaware Trustee” means the
Person identified as the “Delaware Trustee” in the preamble to this Declaration
of Trust, solely in its capacity as Delaware Trustee of the Trust and not in its
individual capacity, or its successor in interest in such capacity, or any
successor Delaware Trustee appointed as herein provided.

       

      “Distribution Date” has the
meaning specified in Section 4.1(a).

       

      “Distributions” means amounts
payable in respect of the Trust Securities as provided in
Section 4.1.

       

      “DTC” means The Depository
Trust Company.

       

      “Early Dissolution Event” has
the meaning specified in Section 9.2.

       

      “Event of Default” means any
one of the following events (whatever the reason for such event and whether it
shall be voluntary or involuntary or be effected by operation of law or pursuant
to any judgment, decree or order of any court or any order, rule or regulation
of any administrative or governmental body):

       

      (a)           the
occurrence of a Debenture Event of Default; or

       

      (b)           default
by the Issuer Trust in the payment of any Distribution when it becomes due and
payable, and continuation of such default for a period of 30 days;
or

       

      (c)           default
by the Issuer Trust in the payment of any Redemption Price of any Trust Security
when it becomes due and payable; or

       

      (d)           default
in the performance, or breach, in any material respect, of any covenant or
warranty of the Issuer Trustees in this Declaration of Trust (other than those
specified in clause (b) or (c)

       

      
        
           

        

        
          4

          
            

          

        

        
           

        

      

      above)
and continuation of such default or breach for a period of 90 days after there
has been given, by registered or certified mail, to the Issuer Trustees and to
the Sponsor by the Holders of at least 25% in aggregate Liquidation Amount of
the Outstanding Preferred Securities a written notice specifying such default or
breach and requiring it to be remedied and stating that such notice is a “Notice
of Default”  hereunder; or

       

      (e)           the
occurrence of a Bankruptcy Event with respect to the Property Trustee if a
successor Property Trustee has not been appointed within 90 days
thereof.

       

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

       

      “Expense Agreement” means the
Agreement as to Expenses and Liabilities, dated as of the Closing Date, between
the Sponsor and the Issuer Trust, substantially in the form attached as
Exhibit C, as amended from time to time.

       

      “Expiration Date” has the
meaning specified in Section 9.1.

       

      “Federal Reserve” means the
Board of Governors of the Federal Reserve System, as from time to time
constituted, or if at any time after the execution of this Declaration of Trust
the Federal Reserve is not existing and performing the duties now assigned to
it, then the bodies performing such duties at such time, or the Federal Reserve
Bank of Chicago, or any successor Federal reserve bank having primary
jurisdiction over the Sponsor.

       

      “Guarantee Agreement” means
the Guarantee Agreement executed and delivered by the Sponsor and Wilmington
Trust Company, as guarantee trustee, contemporaneously with the execution and
delivery of this Declaration of Trust, for the benefit of the holders of the
Preferred Securities, as amended from time to time.

       

      “Holder” means a Person in
whose name a Trust Security or Trust Securities are registered in the Securities
Register; any such Person shall be a beneficial owner within the meaning of the
Delaware Statutory Trust Act.

       

      “Indenture” means the Junior
Subordinated Indenture, dated as of May 22, 2008, between the Sponsor and
the Debenture Trustee, as trustee, as may be amended or supplemented from time
to time.

       

      “Issuer Trust” means the
Delaware statutory trust heretofore known as “PrivateBancorp Capital
Trust IV,” which was formed on May 1, 2008 under the Delaware
Statutory Trust Act pursuant to the Original Declaration of Trust and the filing
of the Certificate of Trust, and continued pursuant to this Declaration of Trust
under the name “PrivateBancorp Capital Trust IV”.

       

      “Issuer Trustees” has the
meaning specified in the preamble to this Declaration of Trust.

       

      “Investment Company Act” means
the Investment Company Act of 1940, or any successor statute thereto, in each
case as amended from time to time.

       

      “Lien” means any lien, pledge,
charge, encumbrance, mortgage, deed of trust, adverse ownership interest,
hypothecation, assignment, security interest or preference, priority or other
security agreement or preferential arrangement of any kind or nature
whatsoever.

       

      “Like Amount” means
(a) with respect to a redemption of any Trust Securities, Trust Securities
having a Liquidation Amount equal to the principal amount of Debentures to be
contemporaneously

       

      
        
           

        

        
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      redeemed
in accordance with the Indenture, the proceeds of which will be used to pay the
Redemption Price of such Trust Securities, (b) with respect to a
distribution of Debentures to Holders of Trust Securities in connection with a
dissolution or liquidation of the Issuer Trust, Debentures having a principal
amount equal to the Liquidation Amount of the Trust Securities of the Holder to
whom such Debentures are distributed, and (c) with respect to any
distribution of Additional Amounts to Holders of Trust Securities, Debentures
having a principal amount equal to the Liquidation Amount of the Trust
Securities in respect of which such distribution is made.

       

      “Liquidation Amount” means the
stated amount of $25.00 per Trust Security.

       

      “Liquidation Date” means the
date of the dissolution of the Issuer Trust pursuant to
Section 9.4.

       

      “Liquidation Distribution” has
the meaning specified in Section 9.4(d).

       

      “Majority in Liquidation Amount of
the Preferred Securities” or “Majority in Liquidation Amount of
the Common Securities”  means, except as provided by the Trust
Indenture Act, Preferred Securities or Common Securities, as the case may be,
representing more than 50% of the aggregate Liquidation Amount of all then
Outstanding Preferred Securities or Common Securities, as the case may
be.

       

      “Officers’ Certificate” means
a certificate signed by the Chairman of the Board of Directors, the Chairman of
the Executive Committee of the Board of Directors, the Chief Executive Officer,
the President, the Chief Operating Officer, a Vice Chairman or a Vice President,
the Treasurer, an Assistant Treasurer, the Secretary, an Assistant Secretary or
the Comptroller of the Company of the Sponsor, and delivered to the Issuer
Trustees.  Any Officers’ Certificate delivered with respect to
compliance with a condition or covenant provided for in this Declaration of
Trust shall include:

       

      (a)           a
statement by each officer signing the Officers’ Certificate that such officer
has read the covenant or condition and the definitions relating
thereto;

       

      (b)           a
brief statement of the nature and scope of the examination or investigation
undertaken by each officer in rendering the Officers’ Certificate;

       

      (c)           a
statement that such officer has made such examination or investigation as, in
such officer’s opinion, is necessary to enable each officer to express an
informed opinion as to whether or not such covenant or condition has been
complied with; and

       

      (d)           a
statement as to whether, in the opinion of each officer, such condition or
covenant has been complied with.

       

      “Opinion of Counsel” means a
written opinion of outside counsel, experienced in matters similar to the
relevant matter who may be counsel for the Sponsor or an Affiliate of the
Sponsor.

       

      “Option Closing Date” has the
meaning given to such term in the Underwriting Agreement.

       

      “Original Declaration of
Trust” has the meaning specified in the recitals to this Declaration of
Trust.

       

      “Outstanding”, when used with
respect to Trust Securities, means, as of the date of determination, all Trust
Securities theretofore executed and delivered under this Declaration of Trust,
except:

       

      (a)           Trust
Securities theretofore cancelled by the Property Trustee or delivered to the
Property Trustee for cancellation;

       

      
        
           

        

        
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      (b)           Trust
Securities for which payment or redemption money in the necessary amount has
been theretofore deposited with the Property Trustee or any Paying Agent; provided that, if such Trust
Securities are to be redeemed, notice of such redemption has been duly given
pursuant to this Declaration of Trust; and

       

      (c)           Trust
Securities that have been paid or in exchange for or in lieu of which other
Trust Securities have been executed and delivered pursuant to Sections 5.4,
5.5, 5.6 and 5.11;

       

      provided, however, that in
determining whether the Holders of the requisite Liquidation Amount of the
Outstanding Preferred Securities have given any request, demand, authorization,
direction, notice, consent or waiver hereunder, Preferred Securities owned by
the Sponsor, any Issuer Trustee or any Affiliate of the Sponsor or of any Issuer
Trustee shall be disregarded and deemed not to be Outstanding, except that
(a) in determining whether any Issuer Trustee shall be protected in relying
upon any such request, demand, authorization, direction, notice, consent or
waiver, only Preferred Securities that such Issuer Trustee knows to be so owned
shall be so disregarded, and (b) the foregoing shall not apply at any time
when all of the outstanding Preferred Securities are owned by the Sponsor, one
or more of the Issuer Trustees and/or any such Affiliate.  Preferred
Securities so owned that have been pledged in good faith may be regarded as
Outstanding if the pledgee establishes to the satisfaction of the Administrative
Trustees the pledgee’s right so to act with respect to such Preferred Securities
and that the pledgee is not the Sponsor or any Affiliate of the
Sponsor.

       

      “Owner” means each Person who
is the beneficial owner of Book-Entry Preferred Securities as reflected in the
records of the Clearing Agency or, if a Clearing Agency Participant is not the
Owner, then as reflected in the records of a Person maintaining an account with
such Clearing Agency (directly or indirectly, in accordance with the rules of
such Clearing Agency).

       

      “Paying Agent” means any
paying agent or co-paying agent appointed pursuant to Section 5.10 and
shall initially be Wilmington Trust Company.

       

      “Payment Account” means a
segregated non-interest-bearing corporate trust account maintained by or on
behalf of the Property Trustee for the benefit of the Holders in which all
amounts paid in respect of the Debentures will be held and from which the
Property Trustee, through the Paying Agent, shall make payments to the Holders
in accordance with Sections 4.1 and 4.2.

       

      “Person” means a legal person,
including any individual, corporation, estate, partnership, joint venture,
association, joint stock company, company, limited liability company, trust,
unincorporated association, or government or any agency or political subdivision
thereof, or any other entity of whatever nature.

       

      “Preferred Securities
Certificate” means a certificate evidencing ownership of Preferred
Securities, substantially in the form attached as Exhibit D.

       

      “Preferred Security” means a
preferred undivided beneficial interest in the assets of the Issuer Trust,
having a Liquidation Amount of $25.00 and having the rights provided therefor in
this Declaration of Trust, including the right to receive Distributions and a
Liquidation Distribution to the extent provided herein.

       

      “Property Trustee” means the
Person identified as the “Property Trustee” in the preamble to this Declaration
of Trust, solely in its capacity as Property Trustee of the Trust and not in its
individual capacity, or its successor in interest in such capacity, or any
successor Property Trustee appointed as herein provided.

       

      
        
           

        

        
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      “Prospectus” means the
prospectus, dated May 8, 2008, of the Sponsor and the Issuer Trust relating to
the offering of the Preferred Securities, as supplemented by the prospectus
supplement, dated May 8, 2008.

       

      “Redemption Date” means, with
respect to any Trust Security to be redeemed, the date fixed for such redemption
by or pursuant to this Declaration of Trust; provided that each Debenture
Redemption Date and the stated maturity of the Debentures shall be a Redemption
Date for a Like Amount of Trust Securities.

       

      “Redemption Price” means, with
respect to any Trust Security, the Liquidation Amount of such Trust Security,
plus accumulated and unpaid Distributions to the Redemption Date, plus the
related amount of the premium, if any, paid by the Sponsor upon the concurrent
redemption of a Like Amount of Debentures.

       

      “Relevant Trustee” has the
meaning specified in Section 8.10.

       

      “Responsible Officer” means,
with respect to the Property Trustee, any officer of the Property Trustee
assigned to its corporate trust services department, or with respect to a
particular corporate trust matter, any officer to whom such matter is referred
because of such officer’s knowledge and familiarity with the particular
subject.

       

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

       

      “Securities Register” and
“Securities Registrar”
have the respective meanings specified in Section 5.5.

       

      “Sponsor” has the meaning
specified in the preamble to this Declaration of Trust.

       

      “Trust Indenture Act” means
the Trust Indenture Act of 1939 as in force at the date as of which this
instrument was executed; provided, however,  that in
the event the Trust Indenture Act of 1939 is amended after such date, “Trust
Indenture Act” means, to the extent required by any such amendment, the Trust
Indenture Act of 1939 as so amended.

       

      “Trust Property” means
(a) the Debentures, (b) any cash on deposit in, or owing to, the
Payment Account, and (c) all proceeds and rights in respect of the
foregoing and any other property and assets for the time being held or deemed to
be held by the Property Trustee pursuant to the trusts of this Declaration of
Trust.

       

      “Trust Security” means any one
of the Common Securities or the Preferred Securities.

       

      “Trust Securities Certificate”
means any one of the Common Securities Certificates or the Preferred Securities
Certificates.

       

      “Underwriting Agreement” means
the Underwriting Agreement, dated as of May 15, 2008, among the Issuer
Trust, the Sponsor and the Underwriters named therein, as the same may be
amended from time to time.

       

      
        
           

        

        
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      ARTICLE II

       

      CONTINUATION
OF THE ISSUER TRUST

       

      Section
2.1                                Name.  The trust
established under the Original Declaration of Trust under the name
“PrivateBancorp Capital Trust IV” and continued hereby shall hereafter be known
as “PrivateBancorp Capital Trust IV”, as such name may be modified from time to
time by the Administrative Trustees following written notice to the Holders of
Trust Securities and the other Issuer Trustees, in which name the Issuer
Trustees may conduct the business of the Issuer Trust, make and execute
contracts and other instruments on behalf of the Issuer Trust and sue and be
sued.

       

      Section
2.2                                Office of the Delaware Trustee;
Principal Place of Business.  The address of the Delaware
Trustee in the State of Delaware is Rodney Square North, 1100 North Market
Street, Wilmington, Delaware 19801, Attention: Corporate Trust Administration,
or such other address in the State of Delaware as the Delaware Trustee may
designate by written notice to the Holders, the Sponsor, the Property Trustee
and the Administrative Trustees.  The principal executive office of
the Issuer Trust is c/o PrivateBancorp, Inc., 70 West Madison, Suite 900,
Chicago, Illinois 60602.

       

      Section
2.3                                Initial Contribution of Trust
Property; Organizational Expenses.  The Sponsor deposited the
sum of $10 in connection with the Original Declaration of Trust, which
constituted the initial Trust Property.  The Sponsor shall pay
organizational expenses of the Issuer Trust as they arise and shall, upon
request of any Issuer Trustee, promptly reimburse such Issuer Trustee for any
such expenses paid by such Issuer Trustee.  The Sponsor shall make no
claim upon the Trust Property for the payment of such expenses.

       

      Section
2.4                                Issuance of the Preferred
Securities.  The Sponsor, both on its own behalf and on behalf
of the Issuer Trust pursuant to the Original Declaration of Trust, executed and
delivered the Underwriting Agreement, which action is hereby authorized,
approved, ratified  and confirmed in all
respects.  Contemporaneously with the execution and delivery of this
Declaration of Trust, an Administrative Trustee, on behalf of the Issuer Trust,
shall manually execute in accordance with Sections 5.2, 5.3 and 8.9(a) and
deliver to the Property Trustee for authentication and the Property Trustee
shall deliver to the Underwriters, a Preferred Securities Certificate,
registered in the name as set forth in Section 5.2(b), evidencing an
aggregate of 5,000,000 Preferred Securities having an aggregate Liquidation
Amount of $125,000,000, against receipt of the aggregate purchase price of such
Preferred Securities of $125,000,000, by the Property Trustee (subject to
increase pursuant to the over-allotment option contained in the Underwriting
Agreement).

       

      Section
2.5                                Issuance of the Common Securities;
Subscription and Purchase of Debentures.  Contemporaneously
with the execution and delivery of this Declaration of Trust, an Administrative
Trustee, on behalf of the Issuer Trust, shall execute in accordance with
Sections 5.2, 5.3 and 8.9(a) and the Property Trustee shall deliver to the
Sponsor, Common Securities Certificates, registered in the name of the Sponsor,
evidencing an aggregate of 400 Common Securities having an aggregate Liquidation
Amount of $25.00, against receipt of the aggregate purchase price of such Common
Securities of $10,000, by the Property Trustee.  Contemporaneously
therewith, an Administrative Trustee, on behalf of the Issuer Trust, shall
subscribe for and purchase from the Sponsor the Debentures, registered in the
name of the Property Trustee on behalf of the Issuer Trust and having an
aggregate principal amount equal to $125,010,000, and, in satisfaction of the
purchase price for such Debentures, the Property Trustee, on behalf of the
Issuer Trust, shall deliver to the Sponsor the sum of $125,010,000 (being the
sum of the amounts delivered to the Property Trustee pursuant to (i) the
second sentence of Section 2.4, and (ii) the first sentence of this
Section 2.5) (subject to increase pursuant to the over-allotment option
contained in the Underwriting Agreement).

       

      
        
           

        

        
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      Section
2.6                                Continuation of
Trust.  The exclusive purposes and functions of the Issuer
Trust are (a) to issue and sell Trust Securities and use the proceeds from
such sale to acquire the Debentures, and (b) to engage in those activities
necessary or incidental thereto.  The Sponsor hereby appoints the
Delaware Trustee, the Property Trustee and the Administrative Trustees as
trustees of the Issuer Trust, to have all the rights, powers and duties to the
extent set forth herein, and the respective Issuer Trustees hereby accept such
appointment.  The Property Trustee hereby declares that it will hold
the Trust Property in trust upon and subject to the conditions set forth herein
for the benefit of the Issuer Trust and the Holders.  The
Administrative Trustees shall have all rights, powers and duties set forth
herein and in accordance with applicable law with respect to accomplishing the
purposes of the Issuer Trust.  The Delaware Trustee shall not be
entitled to exercise any powers, nor shall the Delaware Trustee have any of the
duties and responsibilities, of the Property Trustee or the Administrative
Trustees set forth herein.  The Delaware Trustee shall be one of the
trustees of the Issuer Trust for the sole and limited purpose of fulfilling the
requirements of Section 3807 of the Delaware Statutory Trust Act and for
taking such actions as are required to be taken by a Delaware trustee under the
Delaware Statutory Trust Act.

       

      Section
2.7                                Authorization to Enter into Certain
Transactions.

       

      (a)           The
Issuer Trustees shall conduct the affairs of the Issuer Trust in accordance with
the terms of this Declaration of Trust.  Subject to the limitations
set forth in paragraph (b) of this Section, and in accordance with the
following provisions (i) and (ii), the Issuer Trustees shall have the
authority to enter into all transactions and agreements determined by the Issuer
Trustees to be appropriate in exercising the authority, express or implied,
otherwise granted to the Issuer Trustees, as the case may be, under this
Declaration of Trust, and to perform all acts in furtherance thereof, including,
the following:

       

      (i)           As
among the Issuer Trustees, each Administrative Trustee, acting singly or
collectively, shall have the power and authority to act on behalf of the Issuer
Trust with respect to the following matters:

       

      (A)           the
preparation and filing by the Issuer Trust with the Commission and the execution
on behalf of the Issuer Trust of a registration statement on the appropriate
form in relation to the Preferred Securities, including any amendments thereto
and the taking of any action necessary or desirable to sell the Preferred
Securities in a transaction or a series of transactions pursuant
thereto;

       

      (B)           the
issuance and sale of the Trust Securities;

       

      (C)           causing
the Issuer Trust to perform the transactions contemplated by and its obligations
under the Underwriting Agreement and causing the Issuer Trust to enter into, and
to execute, deliver and perform the Expense Agreement and the Certificate
Depository Agreement and such other agreements as may be necessary or desirable
in connection with the purposes and function of the Issuer Trust;

       

      (D)           assisting
in the registration of the Preferred Securities under the Securities Act and
under applicable state securities or blue sky laws and the qualification of this
Declaration of Trust as a trust indenture under the Trust Indenture
Act;

       

      (E)           assisting
in the listing of the Preferred Securities upon such securities exchange or
exchanges as shall be determined by the Sponsor, with the

       

      
        
           

        

        
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      registration
of the Preferred Securities under the Exchange Act and with the preparation and
filing of all periodic and other reports and other documents pursuant to the
foregoing;

       

      (F)           assisting
in the sending of notices (other than notices of default) and other information
regarding the Trust Securities and the Debentures to the Holders in accordance
with this Declaration of Trust;

       

      (G)           the
consent to the appointment of a Paying Agent, authenticating agent and
Securities Registrar in accordance with this Declaration of Trust (which consent
shall not be unreasonably withheld);

       

      (H)           the
execution of the Trust Securities on behalf of the Issuer Trust in accordance
with this Declaration of Trust;

       

      (I)           the
execution and delivery of closing certificates, if any, pursuant to the
Underwriting Agreement and application for a taxpayer identification number for
the Issuer Trust;

       

      (J)           to
the extent provided herein, the winding-up of the affairs of and the liquidation
of the Issuer Trust and the preparation and filing of the certificate of
cancellation with the Secretary of State of the State of Delaware.

       

      (K)           unless
otherwise required by the Delaware Statutory Trust Act or the Trust Indenture
Act, executing on behalf of the Issuer Trust (either acting alone or together
with the other Administrative Trustee) any documents that the Administrative
Trustees have the power to execute pursuant to this Declaration of Trust;
and

       

      (L)           the
taking of any action incidental to the foregoing as the Issuer Trustees may from
time to time determine to be necessary or advisable to give effect to the terms
of this Declaration of Trust.

       

      (ii)           As
among the Issuer Trustees, the Property Trustee shall have the power, duty and
authority to act on behalf of the Issuer Trust with respect to the following
matters:

       

      (A)           the
establishment of the Payment Account;

       

      (B)           the
receipt of the Debentures;

       

      (C)           the
collection of interest, principal and any other payments made in respect of the
Debentures and the holding of such amounts in the Payment Account;

       

      (D)           the
distribution through the Paying Agent of amounts distributable to the Holders in
respect of the Trust Securities;

       

      (E)           the
exercise of all of the rights, powers and privileges of a holder of the
Debentures;

       

      
        
           

        

        
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      (F)           the
sending of notices of default and other information regarding the Trust
Securities and the Debentures to the Holders in accordance with this Declaration
of Trust;

       

      (G)           the
distribution of the Trust Property in accordance with the terms of this
Declaration of Trust;

       

      (H)           to
the extent provided in this Declaration of Trust, the winding up of the affairs
of and liquidation of the Issuer Trust;

       

      (I)           performing
the duties of the Property Trustee set forth in this Declaration of
Trust;

       

      (J)           after
an Event of Default (other than under paragraph (b), (c), (d) or (e) of the
definition of such term if such Event of Default is by or with respect to the
Property Trustee) the taking of any action incidental to the foregoing as the
Property Trustee may from time to time determine is necessary or advisable to
give effect to the terms of this Declaration of Trust and protect and conserve
the Trust Property for the benefit of the Holders (without consideration of the
effect of any such action on any particular Holder); and

       

      (K)           any
of the duties, liabilities, powers or the authority of the Administrative
Trustees set forth herein; and in the event of a conflict between the action of
the Administrative Trustees and the action of the Property Trustee, the action
of the Property Trustee shall prevail.

       

      (b)           So
long as this Declaration of Trust remains in effect, the Issuer Trust (or the
Issuer Trustees acting on behalf of the Issuer Trust) shall not undertake any
business, activities or transaction except as expressly provided herein or
contemplated hereby.  In particular, the Issuer Trustees shall not
(i) acquire any investments or engage in any activities not authorized by
this Declaration of Trust, (ii) sell, assign, transfer, exchange, mortgage,
pledge, set off or otherwise dispose of any of the Trust Property or interests
therein, including to Holders, except as expressly provided herein,
(iii) take any action that would reasonably be expected to cause the Issuer
Trust to be classified as an association taxable as a corporation or classified
as other than a grantor trust for United States Federal income tax purposes,
(iv) incur any indebtedness for borrowed money or issue any other debt, or
(v) take or consent to any action that would result in the placement of a
Lien on any of the Trust Property.  The Administrative Trustees shall
defend all claims and demands of all Persons at any time claiming any Lien on
any of the Trust Property adverse to the interest of the Issuer Trust or the
Holders in their capacity as Holders.

       

      (c)           In
connection with the issue and sale of the Preferred Securities, the Sponsor
shall have the right and responsibility to assist the Issuer Trust with respect
to, or effect on behalf of the Issuer Trust, the following (and any actions
taken by the Sponsor in furtherance of the following prior to the date of this
Declaration of Trust are hereby ratified and confirmed in all
respects):

       

      (i)           the
preparation and filing by the Issuer Trust with the Commission and the execution
on behalf of the Issuer Trust of a registration statement on the appropriate
form in relation to the Preferred Securities, including any amendments thereto
and the taking of any action necessary or desirable to sell the Preferred
Securities in a transaction or a series of transactions pursuant
thereto;

       

      
        
           

        

        
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      (ii)           the
determination of the States in which to take appropriate action to qualify or
register for sale all or part of the Preferred Securities and the taking of any
and all such acts, other than actions that must be taken by or on behalf of the
Issuer Trust, and advice to the Issuer Trust of actions that must be taken by or
on behalf of the Issuer Trust, and the preparation for execution and filing of
any documents to be executed and filed by the Issuer Trust or on behalf of the
Issuer Trust, as the Sponsor deems necessary or advisable in order to comply
with the applicable laws of any such States in connection with the sale of the
Preferred Securities;

       

      (iii)           the
preparation for filing by the Issuer Trust and execution on behalf of the Issuer
Trust of an application to the Nasdaq Global Select Market or any other national
securities exchange for listing upon notice of issuance of any Preferred
Securities;

       

      (iv)           the
preparation for filing by the Issuer Trust with the Commission and the execution
on behalf of the Issuer Trust of a registration statement on Form 8-A relating
to the registration of the Preferred Securities under Section 12(b) of the
Exchange Act, including any amendments thereto;

       

      (v)           the
preparation and execution of a Letter of Representation to the Depository Trust
Company on behalf of the Issuer Trust;

       

      (vi)           the
negotiation of the terms of, and the execution and delivery of, the Underwriting
Agreement providing for the sale of the Preferred Securities; and

       

      (vii)           the
taking of any other actions necessary or desirable to carry out any of the
foregoing activities.

       

      (d)           Notwithstanding
anything herein to the contrary, the Issuer Trustees are authorized and directed
to conduct the affairs of the Issuer Trust and to operate the Issuer Trust so
that the Issuer Trust will not be deemed to be an “investment company” required
to be registered under the Investment Company Act, and will not be taxable as a
corporation or classified as other than a grantor trust for United States
Federal income tax purposes and so that the Debentures will be treated as
indebtedness of the Sponsor for United States Federal income tax
purposes.  In this connection, each Administrative Trustee, the
Property Trustee and the Holders of at least a Majority in Liquidation Amount of
the Common Securities are authorized to take any action, not inconsistent with
applicable law, the Certificate of Trust, or this Declaration of Trust, that
such Administrative Trustee, the Property Trustee or Holders of Common
Securities determine in their discretion to be necessary or desirable for such
purposes, as long as such action does not adversely affect in any material
respect the interests of the Holders of the Outstanding Preferred
Securities.  In no event shall the Issuer Trustees be liable to the
Issuer Trust or the Holders for any failure to comply with this section or
Section 2.7(b) (iii) that results from a change in law or regulation or in the
interpretation by a governmental authority thereof.

       

      Section
2.8                                Assets of
Trust.  The assets of the Issuer Trust shall consist of the
Trust Property.

       

      Section
2.9                                Title to Trust
Property.  Legal title to all Trust Property shall be vested at
all times in the Property Trustee (in its capacity as such) and shall be held
and administered by the Property Trustee in trust for the benefit of the Issuer
Trust and the Holders in accordance with this Declaration of Trust.

       

      
        
           

        

        
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      ARTICLE III

       

      PAYMENT
ACCOUNT

       

      Section
3.1                                Payment Account.

       

      (a)           On
or prior to the Closing Date, the Property Trustee shall establish the Payment
Account with the Paying Agent.  The Property Trustee and its agents
shall have exclusive control and sole right of withdrawal with respect to the
Payment Account for the purpose of making deposits in and withdrawals from the
Payment Account in accordance with this Declaration of Trust.  All
monies and other property deposited or held from time to time in the Payment
Account shall be held by the Property Trustee in the Payment Account for the
exclusive benefit of the Holders and for distribution as herein provided,
including (and subject to) any priority of payments provided for
herein.

       

      (b)           The
Property Trustee shall deposit (or cause to be deposited) in the Payment
Account, promptly upon receipt, all payments of principal of or interest on, and
any other payments or proceeds with respect to, the
Debentures.  Amounts held in the Payment Account shall not be invested
by the Property Trustee pending distribution thereof.

       

      ARTICLE IV

       

      DISTRIBUTIONS;
REDEMPTION

       

      Section
4.1                                Distributions.

       

      (a)           The
Trust Securities represent undivided beneficial interests in the Trust Property,
and Distributions (including of Additional Amounts) will be made on the Trust
Securities at the rate and on the dates that payments of interest (including of
Additional Interest, as defined in the Indenture) are made on the
Debentures.  Accordingly:

       

      (i)           Distributions
on the Trust Securities shall be cumulative, and will accumulate whether or not
there are funds of the Issuer Trust available for the payment of
Distributions.  Distributions shall accumulate from May 22, 2008,
and, except in the event (and to the extent) that the Sponsor exercises its
right to defer the payment of interest on the Debentures pursuant to the
Indenture, shall be payable quarterly in arrears on March 15, June 15,
September 15 and December 15 of each year, commencing on
September 15, 2008.  If any date on which a Distribution is
otherwise payable on the Trust Securities is not a Business Day, then the
payment of such Distribution shall be made on the next succeeding day that is a
Business Day (and without any interest or other payment in respect of any such
delay), except that, if such Business Day is in the next succeeding calendar
year, the payment of such Distribution shall be made on the immediately
preceding Business Day, in each case with the same force and effect as if made
on the date on which such payment was originally payable (each date on which
Distributions are payable in accordance with this Section 4.1 (a), a
“Distribution
Date”).

       

      (ii)           The
Trust Securities shall be entitled to Distributions payable at a rate of 10.00%
per annum of the Liquidation Amount of the Trust Securities.  The
amount of Distributions payable for any period less than a full Distribution
period shall be computed on the basis of a 360-day year of twelve 30-day months
and the actual number of days elapsed in a partial month in a
period.  Distributions payable for each full Distribution period will
be computed by dividing the rate per annum by four.  The amount of
Distributions payable for any period shall include any Additional Amounts in
respect of such period.

       

      
        
           

        

        
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      (iii)           Distributions
on the Trust Securities shall be made by the Paying Agent on behalf of the
Property Trustee from the Payment Account and shall be payable on each
Distribution Date only to the extent that the Issuer Trust has funds then on
hand and available in the Payment Account for the payment of such
Distributions.

       

      (b)           Distributions
on the Trust Securities with respect to a Distribution Date shall be payable to
the Holders thereof as they appear on the Securities Register for the Trust
Securities at the close of business on the relevant record date, which shall be,
so long as the Preferred Securities are represented by Book-Entry Preferred
Securities, at the close of business on the Business Day preceding the relevant
Distribution Date, and which shall be, so long as the Preferred Securities are
not represented by Book-Entry Preferred Securities, the first day of the month
in which the relevant Distribution Date occurs without giving effect to the
third sentence of Section 4.1(a)(i) (whether or not such record date is a
Business Day).

       

      Section
4.2                                Redemption.

       

      (a)           On
each Debenture Redemption Date and on the stated maturity of the Debentures, the
Issuer Trust will be required to redeem a Like Amount of Trust Securities at the
Redemption Price.

       

      (b)           Notice
of redemption shall be given by the Property Trustee by first-class mail,
postage prepaid, mailed not less than 30 nor more than 60 days prior to the
Redemption Date to each Holder of Trust Securities to be redeemed, at such
Holder’s address appearing in the Security Register.  All notices of
redemption shall state:

       

      (i)           the
Redemption Date;

       

      (ii)           the
Redemption Price or if the Redemption Price cannot be calculated prior to the
time the notice is required to be sent, an estimate of the Redemption Price
provided pursuant to the Indenture together with a statement that it is an
estimate and that the actual Redemption Price will be calculated on the third
Business Day prior to the Redemption Date (and if an estimate is provided, a
further notice shall be sent of the actual Redemption Price on the date that
such Redemption Price is calculated);

       

      (iii)           the
CUSIP number or CUSIP numbers of the Preferred Securities affected (if
applicable);

       

      (iv)           if
less than all the Outstanding Trust Securities are to be redeemed, the
identification and the aggregate Liquidation Amount of the particular Trust
Securities to be redeemed;

       

      (v)           that
on the Redemption Date the Redemption Price will become due and payable upon
each such Trust Security to be redeemed and that Distributions thereon will
cease to accumulate on and after said date, except as provided in
Section 4.2(d) below; and

       

      (vi)           the
place or places where the Trust Securities are to be surrendered for the payment
of the Redemption Price.

       

      The
Issuer Trust in issuing the Trust Securities may use “CUSIP” numbers (if then
generally in use), and, if so, the Property Trustee shall indicate the “CUSIP”
numbers of the Trust Securities in notices of redemption and related materials
as a convenience to Holders; provided that any

       

      
        
           

        

        
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      such
notice may state that no representation is made as to the correctness of such
numbers either as printed on the Trust Securities or as contained in any notice
of redemption and related materials.

       

      (c)           The
Trust Securities redeemed on each Redemption Date shall be redeemed at the
Redemption Price with the proceeds from the contemporaneous redemption or
repayment of Debentures.  Redemptions of the Trust Securities shall be
made and the Redemption Price shall be payable on each Redemption Date only to
the extent that the Issuer Trust has funds then on hand and available in the
Payment Account for the payment of such Redemption Price.

       

      (d)           If
the Property Trustee gives a notice of redemption in respect of any Preferred
Securities, then, by 12:00 noon, New York City time, on the Redemption Date,
subject to Section 4.2(c), the Property Trustee will, with respect to
Book-Entry Preferred Securities, irrevocably deposit with the Clearing Agency
for such Book-Entry Preferred Securities, to the extent available therefor,
funds sufficient to pay the applicable Redemption Price and will give such
Clearing Agency irrevocable instructions and authority to pay the Redemption
Price to the Holders of the Preferred Securities.  With respect to
Preferred Securities that are not Book-Entry Preferred Securities, the Property
Trustee, subject to Section 4.2(c), will irrevocably deposit with the
Paying Agent, to the extent available therefor, funds sufficient to pay the
applicable Redemption Price and will give the Paying Agent irrevocable
instructions and authority to pay the Redemption Price to the Holders of the
Preferred Securities upon surrender of their Preferred Securities
Certificates.  Notwithstanding the foregoing, Distributions payable on
or prior to the Redemption Date for any Trust Securities called for redemption
shall be payable to the Holders of such Trust Securities as they appear on the
Securities Register for the Trust Securities on the relevant record dates for
the related Distribution Dates.  If notice of redemption shall have
been given and funds deposited as required, then upon the date of such deposit,
all rights of Holders holding Trust Securities so called for redemption will
cease, except the right of such Holders to receive the Redemption Price and any
Distribution payable in respect of the Trust Securities on or prior to the
Redemption Date, but without interest, and such Securities will cease to be
outstanding.  In the event that any date on which any Redemption Price
is payable is not a Business Day, then payment of the Redemption Price payable
on such date will be made on the next succeeding day that is a Business Day
(without any interest or other payment in respect of any such delay), except
that, if such Business Day falls in the next calendar year, such payment will be
made on the immediately preceding Business Day, in each case, with the same
force and effect as if made on such date.  In the event that payment
of the Redemption Price in respect of any Trust Securities called for redemption
is improperly withheld or refused and not paid either by the Issuer Trust or by
the Sponsor pursuant to the Guarantee Agreement, Distributions on such Trust
Securities will continue to accumulate, as set forth in Section 4.1, from
the Redemption Date originally established by the Issuer Trust for such Trust
Securities to the date such Redemption Price is actually paid, in which case the
actual payment date will be the date fixed for redemption for purposes of
calculating the Redemption Price.

       

      (e)           Subject
to Section 4.3(a), if less than all the Outstanding Trust Securities are to
be redeemed on a Redemption Date, then the aggregate Liquidation Amount of Trust
Securities to be redeemed shall be allocated pro rata to the Common Securities
and the Preferred Securities based upon the relative Liquidation Amounts of such
classes.  The particular Preferred Securities to be redeemed shall be
selected on a  pro rata  basis based upon their respective
Liquidation Amounts not more than 60 days prior to the Redemption Date by the
Property Trustee from the Outstanding Preferred Securities not previously called
for redemption, provided that so long as the Preferred Securities are in
book-entry-only form, such selection shall be made in accordance with the
customary procedures for the Clearing Agency for the Preferred
Securities.  The Property Trustee shall promptly notify the Securities
Registrar in writing of the Preferred Securities selected for redemption and, in
the case of any Preferred Securities selected for partial redemption, the
Liquidation Amount thereof to be redeemed.  For all purposes of this
Declaration of Trust, unless the context otherwise requires, all provisions
relating to the redemption of Preferred 

       

      
        
           

        

        
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      Securities
shall relate, in the case of any Preferred Securities redeemed or to be redeemed
only in part, to the portion of the aggregate Liquidation Amount of Preferred
Securities that has been or is to be redeemed.

       

      Section
4.3                                Subordination of Common
Securities.

       

      (a)           Payment
of Distributions (including any Additional Amounts) on, the Redemption Price of,
and the Liquidation Distribution in respect of the Trust Securities, as
applicable, shall be made, subject to Section 4.2(e), pro rata among the
Common Securities and the Preferred Securities based on the Liquidation Amount
of the Trust Securities; provided, however, that if on
any Distribution Date, Redemption Date or Liquidation Date any Event of Default
resulting from a Debenture Event of Default specified in Section 5.1(1) of
the Indenture shall have occurred and be continuing, no payment of any
Distribution (including any Additional Amounts) on, Redemption Price of, or
Liquidation Distribution in respect of any Common Security, and no other payment
on account of the redemption, liquidation or other acquisition of Common
Securities, shall be made unless payment in full in cash of all accumulated and
unpaid Distributions (including any Additional Amounts) on all Outstanding
Preferred Securities for all Distribution periods terminating on or prior
thereto, or in the case of payment of the Redemption Price the full amount of
such Redemption Price on all Outstanding Preferred Securities then called for
redemption, or in the case of payment of the Liquidation Distribution the full
amount of such Liquidation Distribution on all Outstanding Preferred Securities,
shall have been made or provided for, and all funds immediately available to the
Property Trustee shall first be applied to the payment in full in cash of all
Distributions (including any Additional Amounts) on, or the Redemption Price of,
the Preferred Securities then due and payable.

       

      (b)           In
the case of the occurrence of any Event of Default resulting from any Debenture
Event of Default, the Holders of the Common Securities shall have no right to
act with respect to any such Event of Default under this Declaration of Trust
until the effect of all such Events of Default with respect to the Preferred
Securities have been cured, waived or otherwise eliminated.  Until all
such Events of Default under this Declaration of Trust with respect to the
Preferred Securities have been so cured, waived or otherwise eliminated, the
Property Trustee shall act solely on behalf of the Holders of the Preferred
Securities and not on behalf of the Holders of the Common Securities, and only
the Holders of the Preferred Securities will have the right to direct the
Property Trustee to act on their behalf.

       

      Section
4.4                                Payment
Procedures.  Payments of Distributions (including any
Additional Amounts) in respect of the Preferred Securities shall be made by
check mailed to the address of the Person entitled thereto as such address shall
appear on the Securities Register or, if the Preferred Securities are held by a
Clearing Agency, such Distributions shall be made to the Clearing Agency in
immediately available funds.  Payments in respect of the Common
Securities shall be made in such manner as shall be mutually agreed between the
Property Trustee and the Holders of the Common Securities.

       

      Section
4.5                                Tax Returns and
Reports.  The Administrative Trustees shall prepare (or cause
to be prepared), at the Sponsor’s expense, and file all United States Federal,
state and local tax and information returns and reports required to be filed by
or in respect of the Issuer Trust.  In this regard, the Administrative
Trustees shall (a) prepare and file (or cause to be prepared and filed) all
Internal Revenue Service forms required to be filed in respect of the Issuer
Trust in each taxable year of the Issuer Trust, and (b) prepare and furnish
(or cause to be prepared and furnished) to each Holder all Internal Revenue
Service forms required to be provided by the Issuer Trust to such
Holder.  The Administrative Trustees shall provide the Sponsor and the
Property Trustee with a copy of all such returns and reports promptly after such
filing or furnishing.  The Issuer Trustees shall comply with United
States Federal withholding

       

      
        
           

        

        
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      and
backup withholding tax laws and information reporting requirements with respect
to any payments to Holders under the Trust Securities.

       

      Section
4.6                                Payment of Taxes, Duties, Etc. of
the Issuer Trust.  Upon receipt under the Debentures of
Additional Sums, the Property Trustee shall promptly pay any taxes, duties or
governmental charges of whatsoever nature (other than withholding taxes) imposed
on the Issuer Trust by the United States or any other taxing authority, which
were included in such Additional Sums.

       

      Section
4.7                                Payments under Indenture or Pursuant
to Direct Actions.  Any amount payable hereunder to any Holder
of Preferred Securities (or any Owner with respect thereto) shall be reduced by
the amount of any corresponding payment such Holder (or Owner) has directly
received pursuant to Section 5.8 of the Indenture or Section 5.13 of
this Declaration of Trust.

       

      Section
4.8                                Liability of the Holder of Common
Securities.  As permitted under the Delaware Statutory Trust
Act, the Holder of the Common Securities shall be liable for the debts and
obligations of the Issuer Trust as set forth in the Expense
Agreement.

       

      ARTICLE V

       

      TRUST
SECURITIES CERTIFICATES

       

      Section
5.1                                Initial
Ownership.  Upon the formation of the Issuer Trust and the
contribution by the Sponsor pursuant to Section 2.3 and until the issuance
of the Trust Securities, and at any time during which no Trust Securities are
outstanding, the Sponsor shall be the sole beneficial owner of the Issuer
Trust.

       

      Section
5.2                                The Trust Securities
Certificates.

       

      (a)           The
Preferred Securities Certificates shall be issued in minimum denominations of
$25.00 Liquidation Amount and integral multiples of $25.00 in excess thereof,
and the Common Securities Certificates shall be issued in denominations of
$25.00 Liquidation Amount and integral multiples thereof.  The Trust
Securities Certificates shall be executed on behalf of the Issuer Trust by
manual signature of at least one Administrative Trustee.  Trust
Securities Certificates bearing the manual signatures of individuals who were,
at the time when such signatures shall have been affixed, authorized to sign on
behalf of the Issuer Trust, shall be validly issued and entitled to the benefits
of this Declaration of Trust, notwithstanding that such individuals or any of
them shall have ceased to be so authorized prior to the delivery of such Trust
Securities Certificates or did not hold such offices at the date of delivery of
such Trust Securities Certificates.  A transferee of a Trust
Securities Certificate shall become a Holder, and shall be entitled to the
rights and subject to the obligations of a Holder hereunder, upon due
registration of such Trust Securities Certificate in such transferee’s name
pursuant to Section 5.5.

       

      (b)           Upon
their original issuance, Preferred Securities Certificates shall be issued in
the form of one or more Book-Entry Preferred Securities Certificates registered
in the name of DTC, as Clearing Agency, or its nominee and deposited with DTC or
the Securities Registrar as custodian for DTC for credit by DTC to the
respective accounts of the Owners thereof (or such other accounts as they may
direct).

       

      (c)           A
single Common Securities Certificate representing the Common Securities shall be
issued to the Sponsor in the form of a definitive Common Securities
Certificate.

       

      
        
           

        

        
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      Section
5.3                                Execution, Delivery and
Authentication of Trust Securities Certificates.  At the
Closing Date, the Administrative Trustees shall cause Trust Securities
Certificates, in the aggregate Liquidation Amounts as provided in
Sections 2.4 and 2.5 with respect to Preferred Securities and Common
Securities, respectively, to be executed on behalf of the Issuer Trust or upon
the written order of the Sponsor, executed by one authorized officer thereof,
and shall cause the Preferred Securities Certificates to be delivered to the
Property Trustee and upon such delivery the Property Trustee shall authenticate
such Preferred Securities Certificates, in each case without further corporate
action by the Sponsor, in authorized denominations.  After the Closing
Date, including each Option Closing Date, if any, the Administrative Trustees
may without the consent of or notice to the Holders cause additional Preferred
Securities to be executed on behalf of the Issuer Trust and delivered to or upon
the written order of the Sponsor, such written order executed by one authorized
officer thereof, without further corporate action by the Sponsor, in authorized
denominations; provided,
however, that no such additional Preferred Securities shall be issued
unless the Administrative Trustees shall have receive an Opinion of Counsel to
the effect that such issuance will not cause the Issuer Trust to be taxable as
other than one or more grantor trusts or agency arrangements or to be classified
as an association or partnership for U.S. federal income tax purposes or affect
the Issuer Trust’s exemption from status as an “investment company” under the
Investment Company Act.  

       

      Each
Preferred Securities Certificate shall be dated the date of its
authentication.

       

      No
Preferred Securities Certificate shall be entitled to any benefit under this
Declaration of Trust or be valid or obligatory for any purpose, unless there
appears on such Preferred Securities Certificate a certificate of authentication
substantially in the form provided for in the form attached as Exhibit D
executed by the Property Trustee by the manual signature of one of its
authorized officers, and such certificate upon any Preferred Securities
Certificate shall be conclusive evidence, and the only evidence, that such
Preferred Securities Certificate has been duly authenticated and delivered
hereunder.

       

      Section
5.4                                Book-Entry Preferred
Securities.

       

      (a)           Each
Book-Entry Preferred Securities Certificate issued under this Declaration of
Trust shall be registered in the name of the Clearing Agency or a nominee
thereof and delivered to such Clearing Agency or a nominee thereof or custodian
therefor, and each such Book-Entry Preferred Securities Certificate shall
constitute a single Preferred Securities Certificate for all purposes of this
Declaration of Trust.

       

      (b)           Notwithstanding
any other provision in this Declaration of Trust, no Book-Entry Preferred
Securities Certificate may be exchanged in whole or in part for Book-Entry
Preferred Securities Certificates registered, and no transfer of a Book-Entry
Preferred Securities Certificate in whole or in part may be registered, in the
name of any Person other than the Clearing Agency for such Book-Entry Preferred
Securities Certificate or a nominee thereof unless (A) such Clearing Agency
(i) has notified the Issuer Trust that it is unwilling or unable to
continue as Clearing Agency for such Book-Entry Preferred Securities Certificate
and no successor Clearing Agency has been appointed within 90 days of this
notice or (ii) has ceased to be a clearing agency registered under the
Exchange Act at a time when the Clearing Agency is required to be so registered
to act as clearing agent and no successor Clearing Agency has been appointed
within 90 days after the Issuer Trust has learned that the Clearing Agency has
ceased to be so registered, (B) there shall have occurred and be continuing
a Debenture Event of Default, or (C) the Sponsor in its sole discretion
determines that such Book-Entry Preferred Securities Certificate will be so
exchangeable or transferable.  Upon the occurrence of any event
specified in clause (A), (B) or (C) above, the Property Trustee shall
notify the Clearing Agency and instruct the Clearing Agency to notify all Owners
of Book-Entry Preferred Securities and the Administrative Trustees of the
occurrence of such

       

      
        
           

        

        
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      event and
of the availability of the Definitive Preferred Securities Certificates to
Owners of such class or classes, as applicable, requesting the
same.

       

      (c)           If
any Book-Entry Preferred Securities Certificate is to be exchanged for other
Preferred Securities Certificates or cancelled in part, or if any other
Preferred Securities Certificate is to be exchanged in whole or in part for
Book-Entry Preferred Securities represented by a Book-Entry Preferred Securities
Certificate, then either (i) such Book-Entry Preferred Securities
Certificate shall be so surrendered for exchange or cancellation as provided in
this Article V or (ii) the aggregate Liquidation Amount represented by
such Book-Entry Preferred Securities Certificate shall be reduced, subject to
Section 5.2, or increased by an amount equal to the Liquidation Amount
represented by that portion of the Book-Entry Preferred Securities Certificate
to be so exchanged or cancelled, or equal to the Liquidation Amount represented
by such other Preferred Securities Certificates to be so exchanged for
Book-Entry Preferred Securities represented thereby, as the case may be, by
means of an appropriate adjustment made on the records of the Securities
Registrar, whereupon the Property Trustee, in accordance with the Applicable
Procedures, shall instruct the Clearing Agency or its authorized representative
to make a corresponding adjustment to its records.  Upon surrender to
the Administrative Trustees or the Securities Registrar of the Book-Entry
Preferred Securities Certificate or Certificates by the Clearing Agency,
accompanied by registration instructions, the Administrative Trustees, or any
one of them, shall execute the Definitive Preferred Securities Certificates in
accordance with the instructions of the Clearing Agency.  None of the
Securities Registrar, the Issuer Trustees or the Administrative Trustees shall
be liable for any delay in delivery of such instructions and may conclusively
rely on, and shall be protected in relying on, such
instructions.  Upon the issuance of Definitive Preferred Securities
Certificates, the Issuer Trustees shall recognize the Holders of the Definitive
Preferred Securities Certificates as Holders.  The Definitive
Preferred Securities Certificates shall be printed, lithographed or engraved or
may be produced in any other manner as is reasonably acceptable to the
Administrative Trustees, as evidenced by the execution thereof by the
Administrative Trustees or any one of them.

       

      (d)           Every
Preferred Securities Certificate executed and delivered upon registration of
transfer of, or in exchange for or in lieu of, a Book-Entry Preferred Securities
Certificate or any portion thereof, whether pursuant to this Article V or
Article IV or otherwise, shall be executed and delivered in the form of,
and shall be, a Book-Entry Preferred Securities Certificate, unless such
Preferred Securities Certificate is registered in the name of a Person other
than the Clearing Agency for such Book-Entry Preferred Securities Certificate or
a nominee thereof.

       

      (e)           The
Clearing Agency or its nominee, as registered owner of a Book-Entry Preferred
Securities Certificate, shall be the Holder of such Book-Entry Preferred
Securities Certificate for all purposes under this Agreement and the Book-Entry
Preferred Securities Certificate, and Owners with respect to a Book-Entry
Preferred Securities Certificate shall hold such interests pursuant to the
Applicable Procedures.  The Securities Registrar and the Issuer
Trustees shall be entitled to deal with the Clearing Agency for all purposes of
this Declaration of Trust relating to the Book-Entry Preferred Securities
Certificates (including the payment of the Liquidation Amount of and
Distributions on the Book-Entry Preferred Securities represented thereby and the
giving of instructions or directions by Owners of Book-Entry Preferred
Securities represented thereby) as the sole Holder of the Book-Entry Preferred
Securities represented thereby and shall have no obligations to the Owners
thereof.  None of the Issuer Trustees nor the Securities Registrar
shall have any liability in respect of any transfers effected by the Clearing
Agency.

       

      The
rights of the Owners of the Book-Entry Preferred Securities shall be exercised
only through the Clearing Agency and shall be limited to those established by
law, the Applicable Procedures and agreements between such Owners and the
Clearing Agency and/or the Clearing Agency Participants.  Pursuant to
the Certificate Depository Agreement, unless and until Definitive Preferred
Securities

       

      
        
           

        

        
          20

          
            

          

        

        
           

        

      

      Certificates
are issued pursuant to Section 5.4(b), the initial Clearing Agency will
make book-entry transfers among the Clearing Agency Participants and receive and
transmit payments on the Preferred Securities to such Clearing Agency
Participants, and none of the Sponsor or the Issuer Trustees shall have any
responsibility or obligation with respect thereto.

       

      Section
5.5                                Registration of Transfer and
Exchange of Preferred Securities Certificates.

       

      (a)           The
Property Trustee shall keep or cause to be kept, at the office or agency
maintained pursuant to Section 5.9, a register or registers for the purpose
of registering Trust Securities Certificates and transfers and exchanges of
Trust Securities Certificates (the “Securities Register”) in
which the registrar and transfer agent with respect to the Trust Securities (the
“Securities
Registrar”), subject to such reasonable regulations as it may prescribe,
shall provide for the registration of Preferred Securities Certificates and
Common Securities Certificates (subject to Section 5.11 in the case of the
Common Securities Certificates) and registration of transfers and exchanges of
Preferred Securities Certificates as herein provided.  The Person
acting as the Property Trustee shall at all times also be the Securities
Registrar.

       

      Upon
surrender for registration of transfer of any Preferred Securities Certificate
at the office or agency maintained pursuant to Section 5.9, the
Administrative Trustees or any one of them shall execute and deliver to the
Property Trustee, and the Property Trustee shall authenticate and deliver, in
the name of the designated transferee or transferees, one or more new Preferred
Securities Certificates in authorized denominations of a like aggregate
Liquidation Amount dated the date of execution by such Administrative Trustee or
Trustees.

       

      The
Securities Registrar shall not be required, (i) to issue, register the
transfer of or exchange any Preferred Security during a period beginning at the
opening of business 15 days before the day of selection for redemption of such
Preferred Securities pursuant to Article IV and ending at the close of
business on the day of mailing of the notice of redemption, or (ii) to
register the transfer of or exchange any Preferred Security so selected for
redemption in whole or in part, except, in the case of any such Preferred
Security to be redeemed in part, any portion thereof not to be
redeemed.

       

      Every
Preferred Securities Certificate presented or surrendered for registration of
transfer or exchange shall be accompanied by a written instrument of transfer in
form satisfactory to an Administrative Trustee and the Securities Registrar duly
executed by the Holder or its attorney duly authorized in
writing.  Each Preferred Securities Certificate surrendered for
registration of transfer or exchange shall be cancelled and subsequently
disposed of by the Property Trustee in accordance with its customary
practice.

       

      No
service charge shall be made for any registration of transfer or exchange of
Preferred Securities Certificates, but the Securities Registrar may require
payment of a sum sufficient to cover any tax or governmental charge that may be
imposed in connection with any transfer or exchange of Preferred Securities
Certificates.

       

      (b)           Notwithstanding
any other provision of this Declaration of Trust, transfers and exchanges of
Preferred Securities Certificates and beneficial interests in a Book-Entry
Preferred Securities Certificate of the kinds specified in this
Section 5.5(b) shall be made only in accordance with this
Section 5.5(b).

       

      (i)           Non-Book-Entry Preferred
Securities Certificate to Book-Entry Preferred Securities
Certificate.  If the Holder of a Preferred Securities
Certificate (other than a Book-Entry Preferred Securities Certificate) wishes at
any time to transfer all or any portion of such Preferred

       

      
        
           

        

        
          21

          
            

          

        

        
           

        

      

      Securities
Certificate to a Person who wishes to take delivery thereof in the form of a
beneficial interest in a Book-Entry Preferred Securities Certificate, such
transfer may be effected only in accordance with the provisions of this
Clause (b)(i) and subject to the Applicable Procedures.  Upon
receipt by the Securities Registrar of (A) such Preferred Securities
Certificate as provided in Section 5.5(a) and instructions satisfactory to
the Securities Registrar directing that a beneficial interest in the Book-Entry
Preferred Securities Certificate of a specified number of Preferred Securities
not greater than the number of Preferred Securities represented by such
Preferred Securities Certificate be credited to a specified Clearing Agency
Participant’s account, then the Securities Registrar shall cancel such Preferred
Securities Certificate (and issue a new Preferred Securities Certificate in
respect of any untransferred portion thereof) as provided in Section 5.5(a)
and increase the aggregate Liquidation Amount of the Book-Entry Preferred
Securities Certificate by the Liquidation Amount represented by such Preferred
Securities so transferred as provided in Section 5.4(c).

       

      (ii)           Non-Book-Entry Preferred
Securities Certificate to Non-Book-Entry Preferred Securities
Certificate.  A Preferred Securities Certificate that is not a
Book-Entry Preferred Securities Certificate may be transferred, in whole or in
part, to a Person who takes delivery in the form of another Preferred Securities
Certificate that is not a Book-Entry Preferred Securities Certificate as
provided in Section 5.5(a).

       

      (iii)           Exchanges between Book-Entry
Preferred Securities Certificate and Non-Book-Entry Preferred Securities
Certificate.  A beneficial interest in a Book-Entry Preferred
Securities Certificate may be exchanged for a Preferred Securities Certificate
that is not a Book-Entry Preferred Securities Certificate as provided in
Section 5.4.

       

      Section
5.6                                Mutilated, Destroyed, Lost or Stolen
Trust Securities Certificates.  If (a) any mutilated Trust
Securities Certificate shall be surrendered to the Securities Registrar, or if
the Securities Registrar shall receive evidence to its satisfaction of the
destruction, loss or theft of any Trust Securities Certificate, and
(b) there shall be delivered to the Securities Registrar and the
Administrative Trustees such security or indemnity as may be required by them to
save each of them harmless, then in the absence of notice that such Trust
Securities Certificate shall have been acquired by a protected purchaser, the
Administrative Trustees, or any one of them, on behalf of the Issuer Trust shall
execute and make available for delivery, in exchange for or in lieu of any such
mutilated, destroyed, lost or stolen Trust Securities Certificate, a new Trust
Securities Certificate of like class, tenor and denomination.  In
connection with the issuance of any new Trust Securities Certificate under this
Section 5.6, the Administrative Trustees or the Securities Registrar may
require the payment of a sum sufficient to cover any tax or other governmental
charge that may be imposed in connection therewith.  Any duplicate
Trust Securities Certificate issued pursuant to this Section shall constitute
conclusive evidence of an undivided beneficial interest in the assets of the
Issuer Trust corresponding to that evidenced by the lost, stolen or destroyed
Trust Securities Certificate, as if originally issued, whether or not the lost,
stolen or destroyed Trust Securities Certificate shall be found at any
time.

       

      Section
5.7                                Persons Deemed
Holders.  The Issuer Trustees and the Securities Registrar
shall each treat the Person in whose name any Trust Securities Certificate shall
be registered in the Securities Register as the owner of such Trust Securities
Certificate for the purpose of receiving Distributions and for all other
purposes whatsoever, and none of the Issuer Trustees and the Securities
Registrar shall be bound by any notice to the contrary.

       

      Section
5.8                                Access to List of Holders’ Names and
Addresses.  Each Holder and each Owner shall be deemed to have
agreed not to hold the Sponsor, the Property Trustee, the Delaware Trustee or
the

       

      
        
           

        

        
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      Administrative
Trustees accountable by reason of the disclosure of its name and address,
regardless of the source from which such information was derived.

       

      Section
5.9                                Maintenance of Office or
Agency.  The Property Trustee shall designate, with the consent
of the Administrative Trustees, which consent shall not be unreasonably
withheld, an office or offices or agency or agencies where Preferred Securities
Certificates may be surrendered for registration of transfer or exchange and
where notices and demands to or upon the Issuer Trustees in respect of the Trust
Securities Certificates may be served.  The Administrative Trustees
initially designate the Property Trustee’s Corporate Trust Office, as its office
and agency for such purposes.  The Property Trustee shall give prompt
written notice to the Sponsor, the Administrative Trustees and to the Holders of
any change in the location of the Securities Register or any such office or
agency.

       

      Section
5.10                                Appointment of Paying
Agent.  The Paying Agent shall make Distributions to Holders
from the Payment Account and shall report the amounts of such Distributions to
the Property Trustee and the Administrative Trustees.  Any Paying
Agent shall have the revocable power to withdraw funds from the Payment Account
solely for the purpose of making the Distributions referred to
above.  The Administrative Trustees may revoke such power and remove
the Paying Agent in their sole discretion.  The Paying Agent shall
initially be Wilmington Trust Company.  Any Person acting as Paying
Agent shall be permitted to resign as Paying Agent upon 30 days’ written notice
to the Administrative Trustees and the Property Trustee.  If
Wilmington Trust Company shall no longer be the Paying Agent or a successor
Paying Agent shall resign or its authority to act be revoked, the Administrative
Trustees shall appoint a successor (which shall be a bank or trust company) to
act as Paying Agent.  Such successor Paying Agent or any additional
Paying Agent appointed by the Administrative Trustees shall execute and deliver
to the Issuer Trustees an instrument in which such successor Paying Agent or
additional Paying Agent shall agree with the Issuer Trustees that as Paying
Agent, such successor Paying Agent or additional Paying Agent will hold all
sums, if any, held by it for payment to the Holders in trust for the benefit of
the Holders entitled thereto until such sums shall be paid to such
Holders.  The Paying Agent shall return all unclaimed funds to the
Property Trustee and upon removal of a Paying Agent such Paying Agent shall also
return all funds in its possession to the Property Trustee.  The
provisions of Sections 8.1, 8.3 and 8.6 herein shall apply to Wilmington
Trust Company in its role as Paying Agent, for so long as Wilmington Trust
Company shall act as Paying Agent and, to the extent applicable, to any other
paying agent appointed hereunder.  Any reference in this Declaration
of Trust to the Paying Agent shall include any co-paying agent unless the
context requires otherwise.

       

      Section
5.11                                Ownership of Common Securities by
Sponsor.  At the Closing Date, the Sponsor shall acquire, and
thereafter shall retain, beneficial and record ownership of the Common
Securities.  The Sponsor may not transfer the Common Securities except
(i) in connection with a consolidation or merger of the Sponsor into
another corporation, or any conveyance, transfer or lease by the Sponsor of its
properties and assets substantially as an entirety to any Person, pursuant to
Article VIII of the Indenture, or (ii) to an Affiliate of the Sponsor
in compliance with applicable law (including the Securities Act and applicable
state securities and blue sky laws).  To the fullest extent permitted
by law, any attempted transfer of the Common Securities other than as set forth
in the next proceeding sentence shall be void.  The Administrative
Trustees shall cause each Common Securities Certificate issued to the Sponsor to
contain a legend stating substantially “THIS CERTIFICATE IS NOT TRANSFERABLE
EXCEPT IN COMPLIANCE WITH APPLICABLE LAW AND SECTION 5.11 OF THE
DECLARATION OF TRUST AND ONLY IN CONNECTION WITH A SIMULTANEOUS DELEGATION AND
ASSIGNMENT OF THE EXPENSE AGREEMENT REFERRED TO THEREIN.”

       

      Section
5.12                                Notices to Clearing
Agency.  To the extent that a notice or other communication to
the Holders is required under this Declaration of Trust, for so long as
Preferred Securities are represented by a Book-Entry Preferred Securities
Certificate, the Issuer Trustees shall give all such

       

      
        
           

        

        
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      notices
and communications specified herein to be given to the Clearing Agency, and
shall have no obligations to the Owners.

       

      Section
5.13                                Rights of Holders; Waivers of Past
Defaults.

       

      (a)           The
legal title to the Trust Property is vested exclusively in the Property Trustee
(in its capacity as such) in accordance with Section 2.9, and the Holders
shall not have any right or title therein other than the undivided beneficial
interest in the assets of the Issuer Trust conferred by their Trust Securities
and they shall have no right to call for any partition or division of property,
profits or rights of the Issuer Trust except as described below.  The
Trust Securities shall be personal property giving only the rights specifically
set forth therein and in this Declaration of Trust.  The Trust
Securities shall have no preemptive or similar rights and when issued and
delivered to Holders against payment of the purchase price therefor will be
fully paid and nonassessable by the Issuer Trust.  Subject to the
provisions of Section 4.8, the Holders of the Trust Securities, in their
capacities as such, shall be entitled to the same limitation of personal
liability extended to stockholders of private corporations for profit organized
under the General Corporation Law of the State of Delaware.

       

      (b)           For
so long as any Preferred Securities remain Outstanding, if, upon a Debenture
Event of Default, the Debenture Trustee fails or the holders of not less than
25% in principal amount of the outstanding Debentures fail to declare the
principal of all of the Debentures to be immediately due and payable, then to
the fullest extent permitted by law, and subject to the terms of the Indenture
and this Declaration of Trust, the Holders of at least 25% in Liquidation Amount
of the Preferred Securities then Outstanding shall have the right to make such
declaration by a notice in writing to the Sponsor and the Debenture
Trustee.

       

      At any
time after a declaration of acceleration with respect to the Debentures has been
made and before a judgment or decree for payment of the money due has been
obtained by the Debenture Trustee as in the Indenture provided, if the Property
Trustee fails to annul any such declaration and waive such default, the Holders
of at least a Majority in Liquidation Amount of the Preferred Securities, by
written notice to the Property Trustee, the Sponsor and the Debenture Trustee,
may rescind and annul such declaration and its consequences if:

       

      (i)           the
Sponsor has paid or deposited with the Debenture Trustee a sum sufficient to
pay

       

      (A)           all
overdue installments of interest (including any Additional Interest) on all of
the Debentures,

       

      (B)           the
principal of (and premium, if any, on) any Debentures that have become due
otherwise than by such declaration of acceleration and interest (including any
Additional Interest) thereon at the rate borne by the Debentures,
and

       

      (C)           all
sums paid or advanced by the Debenture Trustee under the Indenture and the
reasonable compensation, expenses, disbursements and advances of the Debenture
Trustee, its agents and counsel; and

       

      (ii)           all
Events of Default with respect to the Debentures, other than the non-payment of
the principal of the Debentures that has become due solely by such acceleration,
have been cured or waived as provided in Section 5.13 of the
Indenture.

       

      
        
           

        

        
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      To the
fullest extent permitted by law and subject to the terms of this Declaration of
Trust and the Indenture, the Holders of at least a Majority in Liquidation
Amount of the Preferred Securities may, on behalf of the Holders of all the
Preferred Securities, waive any past default under the Indenture, except a
default in the payment of principal or interest (unless such default has been
cured and a sum sufficient to pay all matured installments of interest and
principal due otherwise than by acceleration has been deposited with the
Debenture Trustee) or a default in respect of a covenant or provision that under
the Indenture cannot be modified or amended without the consent of the holder of
each outstanding Debenture.  No such rescission shall affect any
subsequent default or impair any right consequent thereon.

       

      Upon
receipt by the Property Trustee of written notice declaring such an
acceleration, or rescission and annulment thereof, by Holders of any part of the
Preferred Securities a record date shall be established for determining Holders
of Outstanding Preferred Securities entitled to join in such notice, which
record date shall be at the close of business on the day the Property Trustee
receives such notice.  The Holders on such record date, or their duly
designated proxies, and only such Persons, shall be entitled to join in such
notice, whether or not such Holders remain Holders after such record date; provided that, unless such
declaration of acceleration, or rescission and annulment, as the case may be,
shall have become effective by virtue of the requisite percentage having joined
in such notice prior to the day that is 90 days after such record date, such
notice of declaration of acceleration, or rescission and annulment, as the case
may be, shall automatically and without further action by any Holder be canceled
and of no further effect.  Nothing in this paragraph shall prevent a
Holder, or a proxy of a Holder, from giving, after expiration of such 90-day
period, a new written notice of declaration of acceleration, or rescission and
annulment thereof, as the case may be, that is identical to a written notice
that has been canceled pursuant to the proviso to the preceding sentence, in
which event a new record date shall be established pursuant to the provisions of
this Section 5.13(b).

       

      (c)           For
so long as any Preferred Securities remain Outstanding, to the fullest extent
permitted by law and subject to the terms of this Declaration of Trust and the
Indenture, upon a Debenture Event of Default specified in Section 5.1(1) of
the Indenture, any Holder of Preferred Securities shall have the right to
institute a proceeding directly against the Sponsor, pursuant to
Section 5.8 of the Indenture, for enforcement of payment to such Holder of
any amounts payable in respect of Debentures having an aggregate principal
amount equal to the aggregate Liquidation Amount of the Preferred Securities of
such Holder (a “Direct
Action”).  Except as set forth in Section 5.13(b) and this
Section 5.13(c), the Holders of Preferred Securities shall have no right to
exercise directly any right or remedy available to the holders of, or in respect
of, the Debentures.

       

      (d)           Except
as otherwise provided in clauses (a), (b) and (c) of this
Section 5.13, to the fullest extent permitted by law and subject to the
terms of this Declaration of Trust and the Indenture, the Holders of at least a
Majority in Liquidation Amount of the Preferred Securities may, on behalf of the
Holders of all the Preferred Securities, waive any past default or Event of
Default and its consequences.  Upon such waiver, any such default or
Event of Default shall cease to exist, and any default or Event of Default
arising therefrom shall be deemed to have been cured, for every purpose of this
Declaration of Trust, but no such waiver shall extend to any subsequent or other
default or Event of Default or impair any right consequent thereon.

       

      
        
           

        

        
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      ARTICLE VI

b

      ACTS
OF HOLDERS; MEETINGS; VOTING

       

      Section
6.1                                Limitations on Voting
Rights.

       

      (a)           Except
as expressly provided in this Declaration of Trust and in the Indenture and as
otherwise required by law, no Holder of Preferred Securities shall have any
right to vote or in any manner otherwise control the administration, operation
and management of the Issuer Trust or the obligations of the parties hereto, nor
shall anything herein set forth, or contained in the terms of the Trust
Securities Certificates, be construed so as to constitute the Holders from time
to time as partners or members of an association.

       

      (b)           So
long as any Debentures are held by the Property Trustee on behalf of the Issuer
Trust, the other Issuer Trustees shall not (i) direct the time, method and
place of conducting any proceeding for any remedy available to the Debenture
Trustee, or execute any trust or power conferred on the Property Trustee with
respect to the Debentures, (ii) waive any past default that may be waived
under Section 5.13 of the Indenture, (iii) exercise any right to
rescind or annul a declaration that the principal of all the Debentures shall be
due and payable, or (iv) consent to any amendment, modification or
termination of the Indenture or the Debentures, where such consent shall be
required, without, in each case, obtaining the prior approval of the Holders of
at least a Majority in Liquidation Amount of the Preferred Securities, provided, however, that where
a consent under the Indenture would require the consent of each Holder of
Debentures affected thereby, no such consent shall be given by the Property
Trustee without the prior written consent of each Holder of Preferred
Securities.  The Issuer Trustees shall not revoke any action
previously authorized or approved by a vote of the Holders of the Preferred
Securities, except by a subsequent vote of the Holders of the Preferred
Securities.  The Property Trustee shall notify all Holders of the
Preferred Securities of any notice of default received with respect to the
Debentures.  In addition to obtaining the foregoing approvals of the
Holders of the Preferred Securities, prior to taking any of the foregoing
actions, the Issuer Trustees shall, at the expense of the Sponsor, obtain an
Opinion of Counsel to the effect that such action shall not cause the Issuer
Trust to be taxable as a corporation or classified as other than a grantor trust
for United States Federal income tax purposes.

       

      (c)           If
any proposed amendment to the Declaration of Trust provides for, or the Issuer
Trustees otherwise propose to effect, (i) any action that would adversely
affect in any material respect the powers, preferences or special rights of the
Preferred Securities, whether by way of amendment to this Declaration of Trust
or otherwise, or (ii) the dissolution of the Issuer Trust, other than
pursuant to the terms of this Declaration of Trust, then the Holders of
Outstanding Preferred Securities as a class will be entitled to vote on such
amendment or proposal and such amendment or proposal shall not be effective
except with the approval of the Holders of at least a Majority in Liquidation
Amount of the Preferred Securities.  Notwithstanding any other
provision of this Declaration of Trust, no amendment to this Declaration of
Trust may be made if, as a result of such amendment, it would cause the Issuer
Trust to be taxable as a corporation or classified as other than a grantor trust
for United States Federal income tax purposes.

       

      Section
6.2                                Notice of
Meetings.  Notice of all meetings of the Holders of the
Preferred Securities, stating the time, place and purpose of the meeting, shall
be given by the Administrative Trustees or, at the written request of the
Administrative Trustees, by the Property Trustee pursuant to Section 10.8
to each Holder of Preferred Securities, at such Holder’s registered address, at
least 15 days and not more than 90 days before the meeting.  At any
such meeting, any business properly before the meeting may be so considered
whether or not stated in the notice of the meeting.  Any adjourned
meeting may be held as adjourned without further notice.

       

      
        
           

        

        
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      Section
6.3                                Meetings of Holders of the Preferred
Securities.  No annual meeting of Holders is required to be
held.  The Administrative Trustees, however, shall call a meeting of
the Holders of the Preferred Securities to vote on any matter upon the written
request of the Holders of at least 25% in aggregate Liquidation Amount of the
Outstanding Preferred Securities and the Administrative Trustees or the Property
Trustee may, at any time in their or its discretion, call a meeting of the
Holders of the Preferred Securities to vote on any matters as to which such
Holders are entitled to vote.

       

      The
Holders of at least a Majority in Liquidation Amount of the Preferred
Securities, present in person or by proxy, shall constitute a quorum at any
meeting of the Holders of the Preferred Securities.

       

      If a
quorum is present at a meeting, an affirmative vote by the Holders present, in
person or by proxy, holding Preferred Securities representing at least a
Majority in aggregate Liquidation Amount of the Preferred Securities held by the
Holders present, either in person or by proxy, at such meeting shall constitute
the action of the Holders of the Preferred Securities, unless this Declaration
of Trust requires a greater number of affirmative votes.

       

      Section
6.4                                Voting
Rights.  Holders shall be entitled to one vote for each $25 of
Liquidation Amount represented by their Outstanding Trust Securities in respect
of any matter as to which such Holders are entitled to vote.

       

      Section
6.5                                Proxies, etc.  At
any meeting of Holders, any Holder entitled to vote thereat may vote by proxy,
provided that no proxy shall be voted at any meeting unless it shall have been
placed on file with the Administrative Trustees, or with such other officer or
agent of the Issuer Trust as the Administrative Trustees may direct, for
verification prior to the time at which such vote shall be
taken.  Pursuant to a resolution of the Property Trustee, proxies may
be solicited in the name of the Property Trustee or one or more officers of the
Property Trustee.  Only Holders of record shall be entitled to
vote.  When Trust Securities are held jointly by several persons, any
one of them may vote at any meeting in person or by proxy in respect of such
Trust Securities, but if more than one of them shall be present at such meeting
in person or by proxy, and such joint owners or their proxies so present
disagree as to any vote to be cast, such vote shall not be received in respect
of such Trust Securities.  A proxy purporting to be executed by or on
behalf of a Holder shall be deemed valid unless challenged at or prior to its
exercise, and the burden of proving invalidity shall rest on the
challenger.  No proxy shall be valid more than three years after its
date of execution.

       

      Section
6.6                                Holder Action by Written
Consent.  Any action that may be taken by Holders at a meeting
may be taken without a meeting and without prior notice if Holders holding at
least a Majority in Liquidation Amount of all Preferred Securities entitled to
vote in respect of such action (or such larger proportion thereof as shall be
required by any other provision of this Declaration of Trust) shall consent to
the action in writing.

       

      Section
6.7                                Record Date for Voting and Other
Purposes.  For the purposes of determining the Holders who are
entitled to notice of and to vote at any meeting or by written consent, or to
participate in any distribution on the Trust Securities in respect of which a
record date is not otherwise provided for in this Declaration of Trust, or for
the purpose of any other action, the Administrative Trustees or Property Trustee
may from time to time fix a date, not more than 90 days prior to the date of any
meeting of Holders or the payment of a distribution or other action, as the case
may be, as a record date for the determination of the identity of the Holders of
record for such purposes.

       

      Section
6.8                                Acts of
Holders.  Any request, demand, authorization, direction,
notice, consent, waiver or other action provided or permitted by this
Declaration of Trust to be given, made or taken by Holders may be embodied in
and evidenced by one or more instruments of substantially similar
tenor

       

      
        
           

        

        
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      signed by
such Holders in person or by an agent duly appointed in writing; and, except as
otherwise expressly provided herein, such action shall become effective when
such instrument or instruments are delivered to an Administrative
Trustee.  Such instrument or instruments (and the action embodied
therein and evidenced thereby) are herein sometimes referred to as the “Act” of
the Holders signing such instrument or instruments.  Proof of
execution of any such instrument or of a writing appointing any such agent shall
be sufficient for any purpose of this Declaration of Trust and (subject to
Section 8.1) conclusive in favor of the Issuer Trustees, if made in the
manner provided in this Section.

       

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

       

      The
ownership of Trust Securities shall be proved by the Securities
Register.

       

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

       

      Without
limiting the foregoing, a Holder entitled hereunder to take any action hereunder
with regard to any particular Trust Security may do so with regard to all or any
part of the Liquidation Amount of such Trust Security or by one or more duly
appointed agents each of which may do so pursuant to such appointment with
regard to all or any part of such Liquidation Amount.

       

      If any
dispute shall arise among the Holders or the Issuer Trustees with respect to the
authenticity, validity or binding nature of any request, demand, authorization,
direction, consent, waiver or other Act of such Holder or Issuer Trustee under
this Article VI, then the determination of such matter by the Property
Trustee shall be conclusive with respect to such matter.

       

      Section
6.9                                Inspection of
Records.  Upon reasonable notice to the Administrative Trustees
and the Property Trustee, the records of the Issuer Trust shall be open to
inspection by Holders during normal business hours for any purpose reasonably
related to such Holder’s interest as a Holder.

       

      ARTICLE VII

       

      REPRESENTATIONS
AND WARRANTIES

       

      Section
7.1                                Representations and Warranties of
the Property Trustee and the Delaware Trustee.  The Property
Trustee and the Delaware Trustee, each severally on behalf of and as to itself,
hereby represents and warrants for the benefit of the Sponsor and the Holders
that:

       

      (a)           the
Property Trustee is a Delaware banking corporation, duly organized, validly
existing and in good standing under the laws of the jurisdiction of its
incorporation or organization;

       

      
        
           

        

        
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      (b)           the
Property Trustee has full corporate power, authority and legal right to execute,
deliver and perform its obligations under this Declaration of Trust and has
taken all necessary action to authorize the execution, delivery and performance
by it of this Declaration of Trust;

       

      (c)           the
Delaware Trustee is a Delaware banking corporation, duly organized, validly
existing and in good standing under the laws of the jurisdiction of its
incorporation or organization;

       

      (d)           the
Delaware Trustee has full corporate power, authority and legal right to execute,
deliver and perform its obligations under this Declaration of Trust and has
taken all necessary action to authorize the execution, delivery and performance
by it of this Declaration of Trust;

       

      (e)           this
Declaration of Trust has been duly authorized, executed and delivered by the
Property Trustee and the Delaware Trustee and constitutes the valid and legally
binding agreement of each of the Property Trustee and the Delaware Trustee
enforceable against each of them in accordance with its terms, subject to
bankruptcy, insolvency, fraudulent transfer, reorganization, moratorium and
similar laws of general applicability relating to or affecting creditors’ rights
and to general equity principles;

       

      (f)           the
execution, delivery and performance of this Declaration of Trust have been duly
authorized by all necessary corporate or other action on the part of the
Property Trustee and the Delaware Trustee and does not require any approval of
stockholders of the Property Trustee or the Delaware Trustee and such execution,
delivery and performance will not (i) violate the Certificate of
Incorporation or By-laws of the Property Trustee or the Delaware Trustee,
(ii) violate any provision of, or constitute, with or without notice or
lapse of time, a default under, or result in the creation or imposition of, any
Lien on any properties included in the Trust Property pursuant to the provisions
of, any indenture, mortgage, credit agreement, license or other agreement or
instrument to which the Property Trustee or the Delaware Trustee is a party or
by which it is bound, or (iii) violate any law, governmental rule or
regulation of the United States of America governing the banking, trust or
general powers of the Property Trustee or the Delaware Trustee (as appropriate
in context) or any order, judgment or decree applicable to the Property Trustee
or the Delaware Trustee;

       

      (g)           neither
the authorization, execution or delivery by the Property Trustee or the Delaware
Trustee of this Declaration of Trust nor the consummation of any of the
transactions by the Property Trustee or the Delaware Trustee (as appropriate in
context) contemplated herein requires the consent or approval of, the giving of
notice to, the registration with or the taking of any other action with respect
to any governmental authority or agency under any existing law governing the
banking, trust or general powers of the Property Trustee or the Delaware
Trustee, as the case may be, under the laws of the United States, or the State
of Delaware; and

       

      (h)           there
are no proceedings pending or, to the best of each of the Property Trustee’s and
the Delaware Trustee’s knowledge, threatened against or affecting the Property
Trustee or the Delaware Trustee in any court or before any governmental
authority, agency or arbitration board or tribunal that, individually or in the
aggregate, would materially and adversely affect the Issuer Trust or would
question the right, power and authority of the Property Trustee or the Delaware
Trustee, as the case may be, to enter into or perform its obligations as one of
the Issuer Trustees under this Declaration of Trust.

       

      Section
7.2                                Representations and Warranties of
Sponsor.  The Sponsor hereby represents and warrants for the
benefit of the Holders that:

       

      
        
           

        

        
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      (a)           the
Trust Securities Certificates issued on the Closing Date on behalf of the Issuer
Trust have been duly authorized and will have been duly and validly executed,
issued and delivered by the Issuer Trustees pursuant to the terms and provisions
of, and in accordance with the requirements of, this Declaration of Trust and
the Holders will be, as of each such date, entitled to the benefits of this
Declaration of Trust; and

       

      (b)           there
are no taxes, fees or other governmental charges payable by the Issuer Trust (or
the Issuer Trustees on behalf of the Issuer Trust) under the laws of the State
of Delaware or any political subdivision thereof in connection with the
execution, delivery and performance by the Property Trustee or the Delaware
Trustee, as the case may be, of this Declaration of Trust.

       

      ARTICLE VIII

       

      THE
ISSUER TRUSTEES

       

      Section
8.1                                Certain Duties and
Responsibilities.

       

      (a)           The
rights, immunities, duties and responsibilities of the Issuer Trustees shall be
as provided by this Declaration of Trust and, in the case of the Property
Trustee, by the Trust Indenture Act (and there shall be no other duties
(including fiduciary duties) or obligations, express or implied, at law or in
equity, of the Issuer Trustees).  Notwithstanding the foregoing, no
provision of this Declaration of Trust shall require any of the Issuer Trustees
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 or they shall have reasonable grounds for believing that
the repayment of such funds or adequate indemnity against such risk or liability
is not reasonably assured to it.  Whether or not therein expressly so
provided, every provision of this Declaration of Trust relating to the conduct
or affecting the liability of or affording protection to the Issuer Trustees
shall be subject to the provisions of this Section 8.1.  Nothing
in this Declaration of Trust shall be construed to release an Administrative
Trustee from liability for his or her own negligent action, his or her own
negligent failure to act, or his or her own willful misconduct with respect to
acts or omissions.  To the extent that, at law or in equity, an Issuer
Trustee has duties and liabilities relating to the Issuer Trust or to the
Holders, such Issuer Trustee shall not be liable to the Issuer Trust or to any
Holder for such Issuer Trustee’s good faith reliance on the provisions of this
Declaration of Trust.  The provisions of this Declaration of Trust, to
the extent that they restrict or eliminate the duties and liabilities of the
Issuer Trustees otherwise existing at law or in equity, are agreed by the
Sponsor and the Holders to replace such other duties and liabilities of the
Issuer Trustees.

       

      (b)           All
payments made by the Property Trustee or a Paying Agent in respect of the Trust
Securities shall be made only from the revenue and proceeds from the Trust
Property and only to the extent that there shall be sufficient revenue or
proceeds from the Trust Property to enable the Property Trustee or a Paying
Agent to make payments in accordance with the terms hereof.  Each
Holder, by its acceptance of a Trust Security, agrees that it will look solely
to the revenue and proceeds from the Trust Property to the extent legally
available for distribution to it as herein provided and that the Issuer Trustees
are not personally liable to it for any amount distributable in respect of any
Trust Security or for any other liability in respect of any Trust
Security.  This Section 8.1(b) does not limit the liability of
the Issuer Trustees expressly set forth elsewhere in this Declaration of Trust
or, in the case of the Property Trustee, in the Trust Indenture
Act.

       

      (c)           No
provision of this Declaration of Trust shall be construed to relieve the
Property Trustee or the Delaware Trustee from liability for its own negligent
action, its own negligent failure to act, or its own willful misconduct, except
that:

       

      
        
           

        

        
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      (i)           the
Property Trustee shall not be liable for any error of judgment made in good
faith by an authorized officer of the Property Trustee, unless it shall be
proved that the Property Trustee was negligent in ascertaining the pertinent
facts;

       

      (ii)           the
Property Trustee shall not be liable with respect to any action taken or omitted
to be taken by it in good faith in accordance with the direction of the Holders
of at least a Majority in Liquidation Amount of the Preferred Securities
relating to the time, method and place of conducting any proceeding for any
remedy available to the Property Trustee, or exercising any trust or power
conferred upon the Property Trustee under this Declaration of
Trust;

       

      (iii)           the
Property Trustee’s sole duty with respect to the custody, safe keeping and
physical preservation of the Debentures and the Payment Account shall be to deal
with such property in a similar manner as the Property Trustee deals with
similar property for its own account, subject to the protections and limitations
on liability afforded to the Property Trustee under this Declaration of Trust
and the Trust Indenture Act;

       

      (iv)           the
Property Trustee shall not be liable for any interest on any money received by
it except as it may otherwise agree with the Sponsor; and money held by the
Property Trustee need not be segregated from other funds held by it except in
relation to the Payment Account maintained by the Property Trustee pursuant to
Section 3.1 and except to the extent otherwise required by
law;

       

      (v)           the
Property Trustee shall not be responsible for monitoring the compliance by the
Administrative Trustees or the Sponsor with their respective duties under this
Declaration of Trust, nor shall the Property Trustee be liable for the default
or misconduct of any other Issuer Trustee or the Sponsor; and

       

      (vi)           No
provision of this Declaration of Trust shall require the Property Trustee to
expend or risk its own funds or otherwise incur personal financial liability in
the performance of any of its duties or in the exercise of any of its rights or
powers.

       

      (d)           The
Administrative Trustees shall not be responsible for monitoring the compliance
by the other Issuer Trustees or the Sponsor with their respective duties under
this Declaration of Trust, nor shall any Administrative Trustee be liable for
the default or misconduct of any other Administrative Trustee, the other Issuer
Trustees or the Sponsor.

       

      Section
8.2                                Certain
Notices.  Within five Business Days after the occurrence of any
Event of Default actually known to the Property Trustee, the Property Trustee
shall transmit, in the manner and to the extent provided in Section 10.8,
notice of such Event of Default to the Holders, the Administrative Trustees and
the Sponsor, unless such Event of Default shall have been cured or
waived.

       

      Within
five Business Days after the receipt of notice of the Sponsor’s exercise of its
right to defer the payment of interest on the Debentures pursuant to the
Indenture, the Property Trustee shall transmit, in the manner and to the extent
provided in Section 10.8, notice of such exercise to the Holders, unless
such exercise shall have been revoked.

       

      Section
8.3                                Certain Rights of Property
Trustee.  Subject to the provisions of
Section 8.1:

       

      (a)           the
Property Trustee may rely and shall be protected in acting or refraining from
acting in good faith upon any resolution, Opinion of Counsel, certificate,
written representation of a Holder or transferee, certificate of auditors or any
other certificate, statement, instrument, opinion, report,

       

      
        
           

        

        
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      notice,
request, consent, order, appraisal, bond, debenture, note, other evidence of
indebtedness or other paper or document believed by it to be genuine and to have
been signed or presented by the proper party or parties;

       

      (b)           if
(i) in performing its duties under this Declaration of Trust the Property
Trustee is required to decide between alternative courses of action,
(ii) in construing any of the provisions of this Declaration of Trust the
Property Trustee finds the same ambiguous or inconsistent with any other
provisions contained herein, or (iii) the Property Trustee is unsure of the
application of any provision of this Declaration of Trust, then, except as to
any matter as to which the Holders of the Preferred Securities are entitled to
vote under the terms of this Declaration of Trust, the Property Trustee shall
deliver a notice to the Sponsor requesting the Sponsor’s opinion as to the
course of action to be taken, and the Property Trustee shall take such action,
or refrain from taking such action, as the Property Trustee shall be instructed
in writing to take, or to refrain from taking, by the Sponsor; provided, however, that if
the Property Trustee does not receive such instructions of the Sponsor within
ten Business Days after it has delivered such notice, or such reasonably shorter
period of time set forth in such notice (which to the extent practicable shall
not be less than two Business Days), it may, but shall be under no duty to, take
or refrain from taking such action not inconsistent with this Declaration of
Trust as it shall deem advisable and in the best interests of the Holders, in
which event the Property Trustee shall have no liability except for its own
negligence or willful misconduct;

       

      (c)           any
direction or act of the Sponsor contemplated by this Declaration of Trust shall
be sufficiently evidenced by an Officers’ Certificate;

       

      (d)           any
direction or act of an Administrative Trustee contemplated by this Declaration
of Trust shall be sufficiently evidenced by a certificate executed by such
Administrative Trustee and setting forth such direction or act;

       

      (e)           the
Property Trustee shall have no duty to see to any recording, filing or
registration of any instrument (including any financing or continuation
statement or any filing under tax or securities laws) or any rerecording,
refiling or re-registration thereof;

       

      (f)           the
Property Trustee may consult with counsel (which counsel may be counsel to the
Sponsor or any of its Affiliates, and may include any of its employees) and the
advice of such counsel shall be full and complete authorization and protection
in respect of any action taken, suffered or omitted by it hereunder in good
faith and in reliance thereon and in accordance with such advice; the Property
Trustee shall have the right at any time to seek instructions concerning the
administration of this Declaration of Trust from any court of competent
jurisdiction;

       

      (g)           the
Property Trustee shall be under no obligation to exercise any of the rights or
powers vested in it by this Declaration of Trust at the request or direction of
any of the Holders or the Sponsor pursuant to this Declaration of Trust, unless
such Holders or Sponsor shall have offered to the Property Trustee reasonable
security or indemnity against the costs, expenses and liabilities that might be
incurred by it in compliance with such request or direction; provided that nothing
contained in this Section 8.3(g) shall be taken to relieve the Property
Trustee, upon the occurrence of an Event of Default actually known to a
Responsible Officer of the Property Trustee, of its obligation to exercise the
rights and powers vested in it by this Declaration of Trust;

       

      (h)           the
Property Trustee shall not be bound to make any investigation into the facts or
matters stated in any resolution, certificate, statement, instrument, opinion,
report, notice, request, consent, order, approval, bond, debenture, note or
other evidence of indebtedness or other paper or

       

      
        
           

        

        
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      document,
unless requested in writing to do so by one or more Holders, but the Property
Trustee may make such further inquiry or investigation into such facts or
matters as it may see fit;

       

      (i)           the
Property Trustee may execute any of the trusts or powers hereunder or perform
any duties hereunder either directly or by or through its agents or attorneys,
provided that the
Property Trustee shall be responsible for its own negligence or misconduct with
respect to selection of any agent or attorney appointed by it
hereunder;

       

      (j)           whenever
in the administration of this Declaration of Trust the Property Trustee shall
deem it desirable to receive instructions with respect to enforcing any remedy
or right or taking any other action hereunder, the Property Trustee (i) may
request instructions from the Holders (which instructions may only be given by
the Holders of the same proportion in Liquidation Amount of the Trust Securities
as would be entitled to direct the Property Trustee under the terms of the Trust
Securities in respect of such remedy, right or action), (ii) may refrain
from enforcing such remedy or right or taking such other action until such
instructions are received, and (iii) shall be protected in acting in
accordance with such instructions; and

       

      (k)           except
as otherwise expressly provided by this Declaration of Trust, the Property
Trustee shall not be under any obligation to take any action that is
discretionary under the provisions of this Declaration of Trust.

       

      No
provision of this Declaration of Trust shall be deemed to impose any duty or
obligation on any Issuer Trustee to perform any act or acts or exercise any
right, power, duty or obligation conferred or imposed on it, in any jurisdiction
in which it shall be illegal, or in which such Person shall be unqualified or
incompetent in accordance with applicable law, to perform any such act or acts,
or to exercise any such right, power, duty or obligation.  No
permissive power or authority available to any Issuer Trustee shall be construed
to be a duty.

       

      Whether
or not therein expressly so provided, every provision of this Declaration of
Trust relating to the conduct or affecting the liability of or affording
protection to the Property Trustee shall extend to each of the Security
Registrar, the Paying Agent and the Delaware Trustee and shall be subject to the
provisions of this Article VIII.

       

      Section
8.4                                Not Responsible for Recitals or
Issuance of Securities.  The recitals contained herein and in
the Trust Securities Certificates shall be taken as the statements of the Issuer
Trust and the Sponsor, and the Issuer Trustees do not assume any responsibility
for their correctness.  The Issuer Trustees shall not be accountable
for the use or application by the Sponsor of the proceeds of the
Debentures.

       

      The
Property Trustee may conclusively assume that any funds held by it hereunder are
legally available unless an officer of the Property Trustee assigned to its
institutional trust services department shall have received written notice from
the Sponsor, any Holder or any other Issuer Trustee that such funds are not
legally available.

       

      Section
8.5                                May Hold
Securities.  Any Issuer Trustee or any other agent of any
Issuer Trustee or the Issuer Trust, in its individual or any other capacity, may
become the owner or pledgee of Trust Securities and, subject to
Sections 8.8 and 8.13, and except as provided in the definition of the term
“Outstanding” in Article I, may otherwise deal with the Issuer Trust with
the same rights it would have if it were not an Issuer Trustee or such other
agent.

       

      Section
8.6                                Compensation; Indemnity;
Fees.  The Sponsor agrees:

       

      
        
           

        

        
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      (a)           to
pay to the Issuer Trustees from time to time such reasonable compensation for
all services rendered by them hereunder as may be agreed by the Sponsor and the
Issuer Trustees from time to time (which compensation shall not be limited by
any provision of law in regard to the compensation of a trustee of an express
trust);

       

      (b)           except
as otherwise expressly provided herein, to reimburse the Issuer Trustees upon
request for all reasonable expenses, disbursements and advances incurred or made
by the Issuer Trustees in accordance with any provision of this Declaration of
Trust (including the reasonable compensation and the expenses and disbursements
of their agents and counsel), except any such expense, disbursement or advance
as may be attributable to their negligence or willful misconduct;
and

       

      (c)           to
the fullest extent permitted by applicable law, to indemnify and hold harmless
(i) each Issuer Trustee, (ii) any Affiliate of any Issuer Trustee,
(iii) any officer, director, shareholder, employee, representative or agent
of any Issuer Trustee, and (iv) any employee or agent of the Issuer Trust
(referred to herein as an “Indemnified Person”) from and
against any loss, damage, liability, action, suit, tax, penalty, expense or
claim of any kind or nature whatsoever incurred by such Indemnified Person by
reason of the creation, operation or termination of the Issuer Trust or any act
or omission performed or omitted by such Indemnified Person on behalf of the
Issuer Trust, except that no Indemnified Person shall be entitled to be
indemnified in respect of any loss, damage, action, suit or claim incurred by
such Indemnified Person by reason of negligence or willful misconduct with
respect to such acts or omissions.

       

      The
provisions of this Section 8.6 shall survive the termination of this
Declaration of Trust and the removal or resignation of any Issuer
Trustee.

       

      No Issuer
Trustee may claim any Lien on any Trust Property as a result of any amount due
pursuant to this Section 8.6.

       

      Section
8.7                                Corporate Property Trustee Required;
Eligibility of Issuer Trustees.

       

      (a)           There
shall at all times be a Property Trustee hereunder with respect to the Trust
Securities.  The Property Trustee shall be a Person that is a national
or state chartered bank and eligible pursuant to the Trust Indenture Act to act
as such and that has a combined capital and surplus of at least
$50,000,000.  If any such Person publishes reports of condition at
least annually, pursuant to law or to the requirements of its supervising or
examining authority, then for the purposes of this Section and to the extent
permitted by the Trust Indenture Act, the combined capital and surplus of such
Person shall be deemed to be its combined capital and surplus as set forth in
its most recent report of condition so published.  If at any time the
Property Trustee with respect to the Trust Securities shall cease to be eligible
in accordance with the provisions of this Section, it shall resign immediately
in the manner and with the effect hereinafter specified in this
Article.  At the time of appointment, the Property Trustee must have
securities rated in one of the three highest rating categories by a nationally
recognized statistical rating organization.

       

      (b)           There
shall at all times be one or more Administrative Trustees hereunder with respect
to the Trust Securities.  Each Administrative Trustee shall be either
a natural person who is at least 21 years of age or a legal entity that shall
act through one or more persons authorized to bind that entity.

       

      (c)           There
shall at all times be a Delaware Trustee with respect to the Trust
Securities.  The Delaware Trustee shall either be (i) a natural
person who is at least 21 years of age and a resident of the State of Delaware,
or (ii) a legal entity with its principal place of business in the State
of

       

      
        
           

        

        
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      Delaware
and that otherwise meets the requirements of applicable Delaware law and that
shall act through one or more persons authorized to bind such
entity.

       

      Section
8.8                                Conflicting
Interests.

       

      (a)           If
the Property Trustee has or shall acquire a conflicting interest within the
meaning of the Trust Indenture Act, the Property Trustee shall either eliminate
such interest or resign, to the extent and in the manner provided by, and
subject to the provisions of, the Trust Indenture Act and this Declaration of
Trust.

       

      (b)           The
Guarantee Agreement and the Indenture shall be deemed to be specifically
described in this Declaration of Trust for the purposes of clause (i) of
the first proviso contained in Section 310(b) of the Trust Indenture
Act.

       

      Section
8.9                                Co-Trustees and Separate
Trustee.  Unless an Event of Default shall have occurred and be
continuing, at any time or times, for the purpose of meeting the legal
requirements of the Trust Indenture Act or of any jurisdiction in which any part
of the Trust Property may at the time be located, the Sponsor and the
Administrative Trustees, by agreed action of the majority of such Trustees,
shall have power to appoint, and upon the written request of the Administrative
Trustees, the Sponsor shall for such purpose join with the Administrative
Trustees in the execution, delivery, and performance of all instruments and
agreements necessary or proper to appoint, one or more Persons approved by the
Property Trustee either to act as co-trustee, jointly with the Property Trustee,
of all or any part of such Trust Property, or to the extent required by law to
act as separate trustee of any such property, in either case with such powers as
may be provided in the instrument of appointment, and to vest in such Person or
Persons in the capacity aforesaid, any property, title, right or power deemed
necessary or desirable, subject to the other provisions of this
Section.  Any co-trustee or separate trustee appointed pursuant to
this Section shall either be (i) a natural person who is at least 21 years
of age and a resident of the United States, or (ii) a legal entity with its
principal place of business in the United States that shall act through one or
more persons authorized to bind such entity.  In case an Event of
Default under the Indenture shall have occurred and be continuing, the Property
Trustee alone shall have the power to make such appointment.

       

      Should
any written instrument from the Sponsor be required by any co-trustee or
separate trustee so appointed for more fully confirming to such co-trustee or
separate trustee such property, title, right, or power, any and all such
instruments shall, on request, be executed, acknowledged and delivered by the
Sponsor.

       

      Every
co-trustee or separate trustee shall, to the extent permitted by law, but to
such extent only, be appointed subject to the following terms,
namely:

       

      (a)           The
Trust Securities Certificates shall be executed by one or more Administrative
Trustees, and the Trust Securities Certificates shall be delivered by the
Property Trustee, and all rights, powers, duties, and obligations hereunder in
respect of the custody of securities, cash and other personal property held by,
or required to be deposited or pledged with, the Property Trustee specified
hereunder shall be exercised solely by the Property Trustee and not by such
co-trustee or separate trustee.

       

      (b)           The
rights, powers, duties, and obligations hereby conferred or imposed upon the
Property Trustee in respect of any property covered by such appointment shall be
conferred or imposed upon and exercised or performed by the Property Trustee or
by the Property Trustee and such co-trustee or separate trustee jointly, as
shall be provided in the instrument appointing such co-trustee or separate
trustee, except to the extent that under any law of any jurisdiction in which
any particular act is to be

       

      
        
           

        

        
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      performed,
the Property Trustee shall be incompetent or unqualified to perform such act, in
which event such rights, powers, duties and obligations shall be exercised and
performed by such co-trustee or separate trustee.

       

      (c)           The
Property Trustee at any time, by an instrument in writing executed by it, with
the written concurrence of the Sponsor, may accept the resignation of or remove
any co-trustee or separate trustee appointed under this Section, and, in case a
Debenture Event of Default has occurred and is continuing, the Property Trustee
shall have power to accept the resignation of, or remove, any such co-trustee or
separate trustee without the concurrence of the Sponsor.  Upon the
written request of the Property Trustee, the Sponsor shall join with the
Property Trustee in the execution, delivery and performance of all instruments
and agreements necessary or proper to effectuate such resignation or
removal.  A successor to any co-trustee or separate trustee so
resigning or removed may be appointed in the manner provided in this
Section.

       

      (d)           No
co-trustee or separate trustee hereunder shall be personally liable by reason of
any act or omission of the Property Trustee or any other trustee
hereunder.

       

      (e)           The
Property Trustee shall not be liable by reason of any act of a co-trustee or
separate trustee.

       

      (f)           Any
Act of Holders delivered to the Property Trustee shall be deemed to have been
delivered to each such co-trustee and separate trustee.

       

      Section
8.10                                Resignation and Removal; Appointment
of Successor.  No resignation or removal of any Issuer Trustee
(the “Relevant
Trustee”) and no appointment of a successor Issuer Trustee pursuant to
this Article shall become effective until the acceptance of appointment by the
successor Issuer Trustee in accordance with the applicable requirements of
Section 8.11.

       

      Subject
to the immediately preceding paragraph, the Relevant Trustee may resign at any
time by giving written notice thereof to the Sponsor.  If the
instrument of acceptance by the successor Trustee required by Section 8.11
shall not have been delivered to the Relevant Trustee within 30 days after the
giving of such notice of resignation, the Relevant Trustee may petition, at the
expense of the Trust, any court of competent jurisdiction for the appointment of
a successor Relevant Trustee.

       

      Unless a
Debenture Event of Default shall have occurred and be continuing, any Issuer
Trustee may be removed at any time by Act of the Holders of Common
Securities.  If a Debenture Event of Default shall have occurred and
be continuing, the Property Trustee or the Delaware Trustee, or both of them,
may be removed at such time by Act of the Holders of a Majority in Liquidation
Amount of the Preferred Securities, delivered to the Relevant Trustee (in its
individual capacity and on behalf of the Trust).  An Administrative
Trustee may be removed by the Holders of Common Securities at any
time.  In no event will the Holders of the Preferred Securities have a
right to vote to appoint, remove or replace the Administrative
Trustees.

       

      If any
Issuer Trustee shall resign, be removed or become incapable of acting as Issuer
Trustee, or if a vacancy shall occur in the office of any Issuer Trustee for any
reason, at a time when no Debenture Event of Default shall have occurred and be
continuing, the Holders of Common Securities, by Act of the Holders of Common
Securities, shall promptly appoint a successor Issuer Trustee or Issuer
Trustees, and the retiring Issuer Trustee shall comply with the applicable
requirements of Section 8.11.  If the Property Trustee or the
Delaware Trustee shall resign, be removed or become incapable of continuing to
act as the Property Trustee or the Delaware Trustee, as the case may be, at a
time when a Debenture Event of Default shall have occurred and be continuing,
the Holders of Preferred Securities, by Act of the Holders

       

      
        
           

        

        
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      of a
Majority in Liquidation Amount of the Preferred Securities then Outstanding
shall promptly appoint a successor Relevant Trustee or Trustees, and such
successor Trustee shall comply with the applicable requirements of
Section 8.11.  If an Administrative Trustee shall resign, be
removed or become incapable of acting as Administrative Trustee, at a time when
a Debenture Event of Default shall have occurred and be continuing, the Holders
of Common Securities by Act of the Holders of Common Securities shall promptly
appoint a successor Administrative Trustee or Administrative Trustees and such
successor Administrative Trustee or Trustees shall comply with the applicable
requirements of Section 8.11.  If no successor Relevant Trustee
shall have been so appointed by the Holders of Common Securities or the Holders
of Preferred Securities and accepted appointment in the manner required by
Section 8.11, any Holder who has been a Holder of Trust Securities for at
least six months may, on behalf of himself and all others similarly situated,
petition any court of competent jurisdiction for the appointment of a successor
Relevant Trustee.

       

      The
Property Trustee shall give notice of each resignation and each removal of an
Issuer Trustee and each appointment of a successor Issuer Trustee to all Holders
in the manner provided in Section 10.8 and shall give notice to the
Sponsor.  Each notice shall include the name of the successor Relevant
Trustee and the address of its Corporate Trust Office if it is the Property
Trustee.

       

      Notwithstanding
the foregoing or any other provision of this Declaration of Trust, in the event
any Administrative Trustee or a Delaware Trustee who is a natural person dies or
becomes, in the opinion of the Sponsor, incompetent or incapacitated, the
vacancy created by such death, incompetence or incapacity may be filled by
(a) the unanimous act of the remaining Administrative Trustees if there are
at least two of them or (b) otherwise by the Sponsor (with the successor in
each case being a Person who satisfies the eligibility requirement for
Administrative Trustees or Delaware Trustee, as the case may be, set forth in
Section 8.7).

       

      Section
8.11                                Acceptance of Appointment by
Successor.  In case of the appointment hereunder of a successor
Issuer Trustee such successor Issuer Trustee so appointed shall execute,
acknowledge and deliver to the Issuer Trust and to the retiring Issuer Trustee
an instrument accepting such appointment, and thereupon the resignation or
removal of the retiring Issuer Trustee shall become effective and such successor
Issuer Trustee, without any further act, deed or conveyance, shall become vested
with all the rights, powers, trusts and duties of the retiring Issuer Trustee;
but, on the request of the Sponsor or the successor Issuer Trustee, such
retiring Issuer Trustee shall, upon payment of its charges, execute and deliver
an instrument transferring to such successor Issuer Trustee all the rights,
powers and trusts of the retiring Issuer Trustee and if the Property Trustee is
the resigning Issuer Trustee shall duly assign, transfer and deliver to the
successor Issuer Trustee all property and money held by such retiring Property
Trustee hereunder.

       

      In case
of the appointment hereunder of a successor Relevant Trustee, the retiring
Relevant Trustee (if requested by the Sponsor) and each successor Relevant
Trustee with respect to the Trust Securities may execute and deliver an
amendment hereto wherein each successor Relevant Trustee shall accept such
appointment and which (a) may contain such provisions as shall be necessary
or desirable to transfer and confirm to, and to vest in, each successor Relevant
Trustee all the rights, powers, trusts and duties of the retiring Relevant
Trustee with respect to the Trust Securities and the Issuer Trust, and
(b) may add to or change any of the provisions of this Declaration of Trust
as may be necessary to provide for or facilitate the administration of the
Issuer Trust by more than one Relevant Trustee, it being understood that nothing
herein or in such amendment shall constitute such Relevant Trustees co-trustees
and upon the execution and delivery of such amendment the resignation or removal
of the retiring Relevant Trustee shall become effective to the extent provided
therein and each such successor Relevant Trustee, without any further act, deed
or conveyance, shall become vested with all the rights, powers, trusts and
duties of the retiring Relevant Trustee; but, on request of the Issuer Trust or
any successor

       

      
        
           

        

        
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      Relevant
Trustee such retiring Relevant Trustee shall duly assign, transfer and deliver
to such successor Relevant Trustee all Trust Property, all proceeds thereof and
money held by such retiring Relevant Trustee hereunder with respect to the Trust
Securities and the Issuer Trust.

       

      Upon
request of any such successor Relevant Trustee, the Issuer Trust shall execute
any and all instruments for more fully and certainly vesting in and confirming
to such successor Relevant Trustee all such rights, powers and trusts referred
to in the first or second preceding paragraph, as the case may be.

       

      No
successor Relevant Trustee shall accept its appointment unless at the time of
such acceptance such successor Relevant Trustee shall be qualified and eligible
under this Article.

       

      Section
8.12                                Merger, Conversion, Consolidation or
Succession to Business.  Any Person into which the Property
Trustee, the Delaware Trustee or any Administrative Trustee that is not a
natural Person may be merged or converted or with which it may be consolidated,
or any Person resulting from any merger, conversion or consolidation to which
such Relevant Trustee shall be a party, or any Person, succeeding to all or
substantially all the corporate trust business of such Relevant Trustee, shall
be the successor of such Relevant Trustee hereunder, provided that such Person
shall be otherwise qualified and eligible under this Article, without the
execution or filing of any paper or any further act on the part of any of the
parties hereto.

       

      Section
8.13                                Preferential Collection of Claims
Against Sponsor or Issuer Trust.  If and when the Property
Trustee shall be or become a creditor of the Sponsor or the Issuer Trust (or any
other obligor upon the Preferred Securities), the Property Trustee shall be
subject to the provisions of the Trust Indenture Act regarding the collection of
claims against the Sponsor or the Issuer Trust (or any such other
obligor).

       

      Section
8.14                                Property Trustee May File Proofs of
Claim.  In case of any receivership, insolvency, liquidation,
bankruptcy, reorganization, arrangement, adjustment, composition or other
similar judicial proceeding relative to the Issuer Trust or any other obligor
upon the Trust Securities or the property of the Issuer Trust or of such other
obligor or their creditors, the Property Trustee (irrespective of whether any
Distributions on the Trust Securities shall then be due and payable and
irrespective of whether the Property Trustee shall have made any demand on the
Issuer Trust for the payment of any past due Distributions) shall be entitled
and empowered, to the fullest extent permitted by law, by intervention in such
proceeding or otherwise:

       

      (a)           to
file and prove a claim for the whole amount of any Distributions owing and
unpaid in respect of the Trust Securities and to file such other papers or
documents as may be necessary or advisable in order to have the claims of the
Property Trustee (including any claim for the reasonable compensation, expenses,
disbursements and advances of the Property Trustee, its agents and counsel) and
of the Holders allowed in such judicial proceeding, and

       

      (b)           to
collect and receive any moneys or other property payable or deliverable on any
such claims and to distribute the same;

       

      and any
custodian, receiver, assignee, trustee, liquidator, sequestrator or other
similar official in any such judicial proceeding is hereby authorized by each
Holder to make such payments to the Property Trustee and, in the event the
Property Trustee shall consent to the making of such payments directly to the
Holders, to pay to the Property Trustee any amount due it for the reasonable
compensation, expenses, disbursements and advances of the Property Trustee, its
agents and counsel, and any other amounts due the Property Trustee.

       

      
        
           

        

        
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      Nothing
herein contained shall be deemed to authorize the Property Trustee to authorize
or consent to or accept or adopt on behalf of any Holder any plan of
reorganization, arrangement, adjustment or
compensation affecting the Trust Securities or the rights of any Holder thereof
or to authorize the Property Trustee to vote in respect of the claim of any
Holder in any such proceeding.

       

      Section
8.15                                Reports by Property
Trustee.

       

      (a)           Within
60 days after June 15 of each year commencing in 2008, the Property Trustee
shall transmit to Holders such reports concerning the Property Trustee and its
actions under this Declaration of Trust as may be required pursuant to the Trust
Indenture Act at the times and in the manner provided pursuant
thereto.

       

      (b)           A
copy of each such report shall, at the time of such transmission to Holders, be
filed by or on behalf of the Property Trustee with each national securities
exchange and such other interdealer quotation system or self-regulatory
organization upon which the Trust Securities are listed or traded, with the
Commission and with the Sponsor.

       

      Section
8.16                                Reports to the Property
Trustee.  Each of the Sponsor and the Administrative Trustees
shall provide to the Property Trustee such documents, reports and information as
required by Section 314 of the Trust Indenture Act (if any) and the
compliance certificate required by Section 314(a) of the Trust Indenture
Act in the form, in the manner and at the times required by Section 314 of
the Trust Indenture Act.  The Sponsor and the Administrative Trustees
shall annually file with the Property Trustee a certificate specifying whether
such Person is in compliance with all of the terms and covenants applicable to
such Person hereunder.

       

      Section
8.17                                Evidence of Compliance with
Conditions Precedent.  Each of the Sponsor and the
Administrative Trustees shall provide to the Property Trustee such evidence of
compliance with any conditions precedent, if any, provided for in this
Declaration of Trust that relate to any of the matters set forth in
Section 314(c) of the Trust Indenture Act.  Any certificate or
opinion required to be given by an officer pursuant to Section 314(c)(1) of
the Trust Indenture Act shall be given in the form of an Officers’
Certificate.

       

      Section
8.18                                Number of Issuer
Trustees.

       

      (a)           The
number of Issuer Trustees shall be five, provided that the Property Trustee and
the Delaware Trustee may be the same Person.  The number of Issuer
Trustees may be increased or decreased by the Holder of the Common Securities
subject to Section 8.7 and 8.20.  The death, resignation, retirement,
removal, bankruptcy, incompetence or incapacity to perform the duties of an Issuer Trustee
shall not operate to annual, dissolve or terminate the Issuer
Trust.

       

      (b)           If
an Issuer Trustee ceases to hold office for any reason, a vacancy shall
occur.  The vacancy shall be filled with an Issuer Trustee appointed
in accordance with Section 8.10.

       

      (c)           The
death, resignation, retirement, removal, bankruptcy, incompetence or incapacity
to perform the duties of an Issuer Trustee shall not operate to annul, dissolve
or terminate the Issuer Trust.

       

      Section
8.19                                Delegation of
Power.

       

      (a)           Any
Administrative Trustee may, by power of attorney consistent with applicable law,
delegate to any other natural person over the age of 21 his or her power for the
purpose of executing

       

      
        
           

        

        
          39

          
            

          

        

        
           

        

      

      any
documents contemplated in Section 2.7(a), including any registration
statement or amendment thereto filed with the Commission, or making any other
governmental filing; and

       

      (b)           The
Administrative Trustees shall have power to delegate from time to time to such
of their number or to the Sponsor the doing of such things and the execution of
such instruments either in the name of the Issuer Trust or the names of the
Administrative Trustees or otherwise as the Administrative Trustees may deem
expedient, to the extent such delegation is not prohibited by applicable law or
contrary to the provisions of this Declaration of Trust.

       

      Section
8.20                                Appointment of Administrative
Trustees.

       

      (a)           The
Administrative Trustees shall initially be Larry D. Richman, an individual,
Dennis L. Klaeser, an individual, and Christopher J. Zinski, an individual, and
their successors shall be appointed by the Holders of a Majority in Liquidation
Amount of the Common Securities, and they may resign or be removed by the
Holders of a Majority in Liquidation Amount of the Common Securities at any
time.  Upon any resignation or removal, the Holders of the Common
Securities shall appoint a successor Administrative Trustee.  Each
successor Administrative Trustee shall sign an agreement agreeing to comply with
the terms of this Declaration of Trust.  If at any time there is no
Administrative Trustee, the Property Trustee or any Holder who has been a Holder
of Trust Securities for at least six months may petition any court of competent
jurisdiction for the appointment of one or more Administrative
Trustees.

       

      (b)           Whenever
a vacancy in the number of Administrative Trustees shall occur, until such
vacancy is filled by the appointment of an Administrative Trustee in accordance
with this Section 8.20, the Administrative Trustees in office, regardless
of their number (and notwithstanding any other provision of this Agreement),
shall have all the powers granted to the Administrative Trustees and shall
discharge all the duties imposed upon the Administrative Trustees by this
Declaration of Trust.

       

      (c)           Notwithstanding
the foregoing or any other provision of this Declaration of Trust, if any
Administrative Trustee who is a natural person dies or becomes, in the opinion
of the Sponsor, incompetent or incapacitated, the vacancy created by such death,
incompetence or incapacity may be filled by the unanimous acts of the remaining
Administrative Trustees, if there were at least two of them prior to such
vacancy, and by the Sponsor, if there were not two such Administrative Trustees
immediately prior to such vacancy (with the successor being a Person who
satisfies the eligibility requirement for Administrative Trustees set forth in
Section 8.7).

       

      ARTICLE IX

       

      TERMINATION,
LIQUIDATION AND MERGER

       

      Section
9.1                                Dissolution Upon Expiration
Date.  Unless earlier dissolved, the Issuer Trust shall
automatically dissolve on June 15, 2068 (the “Expiration Date”), and the
Trust Property shall be liquidated in accordance with
Section 9.4.

       

      Section
9.2                                Early
Dissolution.  The first to occur of any of the following events
is an “Early Dissolution Event”, upon the occurrence of which the Issuer Trust
shall dissolve:

       

      (a)           the
occurrence of a Bankruptcy Event in respect of, or the dissolution or
liquidation of, the Sponsor;

       

      
        
           

        

        
          40

          
            

          

        

        
           

        

      

      (b)           the
written direction to the Property Trustee from all of the Holders of the Common
Securities at any time to dissolve the Issuer Trust and to distribute the
Debentures to Holders in exchange for the Preferred Securities (which direction
is optional and wholly within the discretion of the Holders of the Common
Securities);

       

      (c)           the
redemption of all of the Preferred Securities in connection with the redemption
of all the Debentures; and

       

      (d)           the
entry of an order for dissolution of the Issuer Trust by a court of competent
jurisdiction.

       

      Section
9.3                                Termination.  The
respective obligations and responsibilities of the Issuer Trustees shall
terminate upon the latest to occur of the following:  (a) the
distribution by the Property Trustee to Holders of all amounts required to be
distributed hereunder upon the liquidation of the Issuer Trust pursuant to
Section 9.4, or upon the redemption of all of the Trust Securities pursuant
to Section 4.2; (b) the payment of any expenses owed by the Issuer
Trust; and (c) the discharge of all administrative duties of the
Administrative Trustees, including the performance of any tax reporting
obligations with respect to the Issuer Trust or the Holders.  As soon
as is practicable after the last to occur of any of the above events, and after
satisfaction of liabilities to creditors of the Issuer Trust as required by
applicable law, including Section 3808 of the Delaware Statutory Trust Act, the
Administrative Trustees shall terminate the Issuer Trust by filing, at the
expense of the Sponsor, a certificate of cancellation with the Secretary of
State of the State of Delaware.  The provisions of Article VIII shall
survive the termination of the Issuer Trust.

       

      Section
9.4                                Liquidation.

       

      (a)           If
an Early Dissolution Event specified in clause (a), (b) or (d) of
Section 9.2 occurs or upon the Expiration Date, the Issuer Trust shall be
liquidated by the Issuer Trustees as expeditiously as the Issuer Trustees
determine to be possible by distributing, after satisfaction of liabilities to
creditors of the Issuer Trust as provided by applicable law, including Section
3808 of the Delaware Statutory Trust Act, to each Holder a Like Amount of
Debentures, subject to Section 9.4(d).  Notice of liquidation
shall be given by the Property Trustee by first-class mail, postage prepaid
mailed not less than 15 nor more than 45 days prior to the Liquidation Date to
each Holder of Trust Securities at such Holder’s address appearing in the
Securities Register.  All such notices of liquidation
shall:

       

      (i)           state
the Liquidation Date;

       

      (ii)           state
that from and after the Liquidation Date, the Trust Securities will no longer be
deemed to be Outstanding and any Trust Securities Certificates not surrendered
for exchange will be deemed to represent a Like Amount of Debentures;
and

       

      (iii)           provide
such information with respect to the procedures by which Holders may exchange
Trust Securities Certificates for Debentures, or if Section 9.4(d) applies
receive a Liquidation Distribution, as the Administrative Trustees or the
Property Trustee shall deem appropriate.

       

      (b)           Except
where Section 9.2(c) or 9.4(d) applies, in order to effect the liquidation
of the Issuer Trust and distribution of the Debentures to Holders, the Property
Trustee, either itself acting as exchange agent or through the appointment of a
separate exchange agent, shall establish a record date for such distribution
(which shall be not more than 30 days prior to the Liquidation Date) and,
establish such

       

      
        
           

        

        
          41

          
            

          

        

        
           

        

      

      procedures
as it shall deem appropriate to effect the distribution of Debentures in
exchange for the Outstanding Trust Securities Certificates.

       

      (c)           Except
where Section 9.2(c) or 9.4(d) applies, after the Liquidation Date,
(i) the Trust Securities will no longer be deemed to be Outstanding,
(ii) certificates representing a Like Amount of Debentures will be issued
to Holders of Trust Securities Certificates, upon surrender of such certificates
to the exchange agent for exchange, (iii) the Sponsor shall use its best
efforts to have the Debentures listed on the Nasdaq Global Select Market or on
such other national securities exchange, interdealer quotation system or
self-regulatory organization as the Preferred Securities are then listed or
traded, (iv) any Trust Securities Certificates not so surrendered for
exchange will be deemed to represent a Like Amount of Debentures bearing accrued
and unpaid interest in an amount equal to the accumulated and unpaid
Distributions on such Trust Securities Certificates until such certificates are
so surrendered (and until such certificates are so surrendered, no payments of
interest or principal will be made to Holders of Trust Securities Certificates
with respect to such Debentures) and (v) all rights of Holders holding
Trust Securities will cease, except the right of such Holders to receive
Debentures upon surrender of Trust Securities Certificates.

       

      (d)           If,
notwithstanding the other provisions of this Section 9.4, whether because
of an order for dissolution entered by a court of competent jurisdiction or
otherwise, distribution of the Debentures in the manner provided herein is
determined by the Administrative Trustees not to be practical, the Trust
Property shall be liquidated, and the Issuer Trust shall be wound up in such
manner as the Property Trustee determines.  In such event, Holders
will be entitled to receive out of the assets of the Issuer Trust available for
distribution to Holders, after satisfaction of liabilities to creditors of the
Issuer Trust as provided by applicable law, including Section 3808 of the
Delaware Statutory Trust Act, an amount equal to the Liquidation Amount per
Trust Security plus accumulated and unpaid Distributions thereon to the date of
payment (such amount being the “Liquidation
Distribution”).  If, upon any such winding up, the Liquidation
Distribution can be paid only in part because the Issuer Trust has insufficient
assets available to pay in full the aggregate Liquidation Distribution, then,
subject to the next succeeding sentence, the amounts payable by the Issuer Trust
on the Trust Securities shall be paid on a pro rata basis (based upon
Liquidation Amounts).  The Holders of the Common Securities will be
entitled to receive Liquidation Distributions upon any such
dissolution  pro rata (determined as aforesaid) with Holders of
Preferred Securities, except that, if a Debenture Event of Default has occurred
and is continuing, the Preferred Securities shall have a priority over the
Common Securities as provided in Section 4.3.

       

      Section
9.5                                Mergers, Consolidations,
Amalgamations or Replacements of Issuer Trust.  The Issuer
Trust may not merge with or into, consolidate, amalgamate, or be replaced by, or
convey, transfer or lease its properties and assets substantially as an entirety
to any corporation or other body, except pursuant to this Section 9.5 or
Section 9.4.  At the request of the Holders of the Common
Securities, with the consent of the Administrative Trustees, the Issuer Trust
may merge with or into, consolidate, amalgamate, or be replaced by or convey,
transfer or lease its properties and assets substantially as an entirety to a
trust organized as such under the laws of any State; provided that (i) such
successor entity either (a) expressly assumes all of the obligations of the
Issuer Trust with respect to the Preferred Securities, or (b) substitutes
for the Preferred Securities other securities having substantially the same
terms as the Preferred Securities (the “Successor Securities”) so
long as the Successor Securities have the same priority as the Preferred
Securities with respect to distributions and payments upon liquidation,
redemption and otherwise, (ii) a trustee of such successor entity
possessing the same powers and duties as the Property Trustee is appointed to
hold the Debentures, (iii) the Successor Securities are listed, or any
Successor Securities will be listed upon notice of issuance, on the Nasdaq
Global Select Market or on such other exchange, interdealer quotation system or
self-regulatory organization as the Preferred Securities are then listed, if
any, (iv) such merger, consolidation, amalgamation, replacement,
conveyance, transfer or lease does not adversely affect the rights, preferences
and privileges of the

       

      
        
           

        

        
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      holders
of the Preferred Securities (including any Successor Securities) in any material
respect, (v) such successor entity has a purpose substantially identical to
that of the Issuer Trust, (vi) prior to such merger, consolidation,
amalgamation, replacement, conveyance, transfer or lease, the Sponsor has
received an Opinion of Counsel to the effect that (a) such merger,
consolidation, amalgamation, replacement, conveyance, transfer or lease does not
adversely affect the rights, preferences and privileges of the Holders of the
Preferred Securities (including any Successor Securities) in any material
respect, and (b) following such merger, consolidation, amalgamation,
replacement, conveyance, transfer or lease, neither the Issuer Trust nor such
successor entity will be required to register as an “investment company” under
the Investment Company Act, and (vii) the Sponsor or its permitted
transferee owns all of the common securities of such successor entity and
guarantees the obligations of such successor entity under the Successor
Securities at least to the extent provided by the Guarantee
Agreement.  Notwithstanding the foregoing, the Issuer Trust shall not,
except with the consent of Holders of all of the Preferred Securities,
consolidate, amalgamate, merge with or into, or be replaced by or convey,
transfer or lease its properties and assets substantially as an entirety to any
other entity or permit any other entity to consolidate, amalgamate, merge with
or into, or replace it if such consolidation, amalgamation, merger, replacement,
conveyance, transfer or lease would cause the Issuer Trust or the successor
entity to be taxable as a corporation or classified as other than a grantor
trust for United States Federal income tax purposes.

       

      ARTICLE X

       

      MISCELLANEOUS
PROVISIONS

       

      Section
10.1                                Limitation of Rights of
Holders.  Except as set forth in Section 9.2, the death,
termination, dissolution, bankruptcy or incapacity of any Person having an
interest, beneficial or otherwise, in Trust Securities shall not operate to
terminate this Declaration of Trust, nor dissolve, terminate or annul the Issuer
Trust, nor entitle the legal representatives, successors or heirs of such Person
or any Holder for such person, to claim an accounting, take any action or bring
any proceeding in any court for a partition or winding up of the arrangements
contemplated hereby, nor otherwise affect the rights, obligations and
liabilities of the parties hereto or any of them.

       

      Section
10.2                                Amendment.

       

      (a)           This
Declaration of Trust may be amended from time to time by the Property Trustee,
the Administrative Trustees and the Holders of all of the Common Securities,
without the consent of any Holder of the Preferred Securities, (i) to cure
any ambiguity, correct or supplement any provision herein that may be
inconsistent with any other provision herein, or to make any other provisions
with respect to matters or questions arising under this Declaration of Trust,
which shall not be inconsistent with the other provisions of this Declaration of
Trust, or (ii) to modify, eliminate or add to any provisions of this
Declaration of Trust to such extent as shall be necessary to ensure that the
Issuer Trust will not be taxable as a corporation or classified as other than a
grantor trust for United States Federal income tax purposes at all times that
any Trust Securities are outstanding or to ensure that the Issuer Trust will not
be required to register as an “investment company” under the Investment Company
Act or to ensure the treatment of the Preferred Securities as Tier 1 regulatory
capital under the prevailing Federal Reserve rules and regulations or (iii) to
conform the terms of the Declaration of Trust to the description of this
Declaration of Trust and the Preferred Securities in the Prospectus; provided, however, that in
the case of either clause (i) or (ii), such action shall not adversely affect in
any material respect the interests of any Holder, and any such amendment of this
Declaration of Trust shall become effective when notice thereof is given to the
Holders.

       

      (b)           Except
as provided in Section 10.2(c), any provision of this Declaration of Trust
may be amended by the Issuer Trustees and the Holders of all of the Common
Securities and with (i) the

       

      
        
           

        

        
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      consent
of Holders of at least a Majority in Liquidation Amount of the Trust Securities,
and (ii) receipt by the Issuer Trustees of an Opinion of Counsel to the
effect that such amendment or the exercise of any power granted to the Issuer
Trustees in accordance with such amendment will not cause the Issuer Trust to be
taxable as a corporation or as other than a grantor trust for United States
Federal income tax purposes or affect the Issuer Trust’s exemption from status
as an “investment company” under the Investment Company Act.

       

      (c)           In
addition to and notwithstanding any other provision in this Declaration of
Trust, without the consent of each affected Holder, this Declaration of Trust
may not be amended to (i) change the amount or timing of any Distribution
on the Trust Securities or otherwise adversely affect the amount of any
Distribution required to be made in respect of the Trust Securities as of a
specified date, or (ii) restrict the right of a Holder to institute suit
for the enforcement of any such payment on or after such date; and
notwithstanding any other provision herein, without the unanimous consent of the
Holders, this Section 10.2(c) may not be amended.

       

      (d)           Notwithstanding
any other provisions of this Declaration of Trust, no Issuer Trustee shall enter
into or consent to any amendment to this Declaration of Trust that would cause
the Issuer Trust to fail or cease to qualify for the exemption from status as an
“investment company” under the Investment Company Act or to be taxable as a
corporation or to be classified as other than a grantor trust for United States
Federal income tax purposes.

       

      (e)           Notwithstanding
anything in this Declaration of Trust to the contrary, without the consent of
the Sponsor and the Administrative Trustees, this Declaration of Trust may not
be amended in a manner that imposes any additional obligation on the Sponsor or
the Administrative Trustees.

       

      (f)           In
the event that any amendment to this Declaration of Trust is made, the
Administrative Trustees or the Property Trustee shall promptly provide to the
Sponsor a copy of such amendment.

       

      (g)           Neither
the Property Trustee nor the Delaware Trustee shall be required to enter into
any amendment to this Declaration of Trust that affects its own rights, duties
or immunities under this Declaration of Trust.  The Property Trustee
shall be entitled to receive an Opinion of Counsel and an Officers’ Certificate
stating that any amendment to this Declaration of Trust is in compliance with
this Declaration of Trust.

       

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

       

      Section
10.4                                Governing
Law.  THIS
TRUST AGREEMENT AND THE RIGHTS AND OBLIGATIONS OF EACH OF THE HOLDERS, THE
ISSUER TRUST, THE SPONSOR AND THE ISSUER TRUSTEES WITH RESPECT TO THIS TRUST
AGREEMENT AND THE TRUST SECURITIES SHALL BE CONSTRUED IN ACCORDANCE WITH AND
GOVERNED BY THE LAWS OF THE STATE OF DELAWARE WITHOUT REFERENCE TO ITS CONFLICTS
OF LAWS PROVISIONS.

       

      Section
10.5                                Payments Due on Non-Business
Day.  If the date fixed for any payment on any Trust Security
shall be a day that is not a Business Day, then such payment need not be made on
such date but may be made on the next succeeding day that is a Business Day
(except as otherwise provided in Sections 4.1(a) and 4.2(d)), with the same
force and effect as though made on the date fixed for such payment, and no
Distributions shall accumulate on such unpaid amount for the period after such
date.

       

      
        
           

        

        
          44

          
            

          

        

        
           

        

      

      Section
10.6                                Successors.  This
Declaration of Trust shall be binding upon and shall inure to the benefit of any
successor to the Sponsor, the Issuer Trust and any Issuer Trustee, including any
successor by operation of law.  Except in connection with a
consolidation, merger or sale involving the Sponsor that is permitted under
Article VIII of the Indenture and pursuant to which the assignee agrees in
writing to perform the Sponsor’s obligations hereunder, the Sponsor shall not
assign its obligations hereunder.

       

      Section
10.7                                Headings.  The
Article and Section headings are for convenience only and shall not affect the
construction of this Declaration of Trust.

       

      Section
10.8                                Reports, Notices and
Demands.  Any report, notice, demand or other communication
that by any provision of this Declaration of Trust is required or permitted to
be given or served to or upon any Holder or the Sponsor shall be sufficient for
every purpose (except as otherwise provided in Section 1.1) hereunder if in
writing and mailed, first class, postage prepaid, addressed, (a) in the
case of a Holder of Preferred Securities, to such Holder as such Holder’s name
and address may appear on the Securities Register; and (b) in the case of
the Holder of the Common Securities or the Sponsor, to PrivateBancorp, Inc., 70
West Madison, Suite 900, Chicago, Illinois, 60602, Attention: General Counsel,
or to such other address as may be specified in a written notice by the Holder
of the Common Securities or the Sponsor, as the case may be, to the Property
Trustee.  Such notice, demand or other communication to or upon a
Holder shall be deemed to have been sufficiently given or made, for all
purposes, upon mailing.  Such notice, demand or other communication to
or upon the Sponsor shall be deemed to have been sufficiently given or made only
upon actual receipt of the writing by the Sponsor.

       

      Any
notice, demand or other communication that by any provision of this Declaration
of Trust is required or permitted to be given or served to or upon the Property
Trustee, the Delaware Trustee, the Administrative Trustees or the Issuer Trust
shall be given in writing addressed to such Person as
follows:  (a) with respect to the Property Trustee to Wilmington
Trust Company, Rodney Square North, 1100 North Market Street, Wilmington,
Delaware 19801, Attention: Corporate Trust Administration; (b) with respect
to the Delaware Trustee, to Wilmington Trust Company, Rodney Square North, 1100
North Market Street, Wilmington, Delaware 19801, Attention: Corporate Trust
Administration; (c) with respect to the Administrative Trustees, to them at
the address above for notices to the Sponsor, marked
“Attention:  Administrative Trustees of PrivateBancorp Capital Trust
IV”; and (d) with respect to the Issuer Trust, to its principal office
specified in Section 2.2, with a copy to the Property
Trustee.  Such notice, demand or other communication to or upon the
Issuer Trust, the Property Trustee or the Administrative Trustees shall be
deemed to have been sufficiently given or made only upon actual receipt of the
writing by the Issuer Trust, the Property Trustee or such Administrative
Trustee.

       

      Section
10.9                                Agreement Not to
Petition.  Each of the Issuer Trustees and the Sponsor agree
for the benefit of the Holders that, until at least one year and one day after
the Issuer Trust has been terminated in accordance with Article IX, they
shall not file, or join in the filing of, a petition against the Issuer Trust
under any bankruptcy, insolvency, reorganization or other similar law (including
the United States Bankruptcy Code) (collectively, “Bankruptcy Laws”) or
otherwise join in the commencement of any proceeding against the Issuer Trust
under any Bankruptcy Law.  If the Sponsor takes action in violation of
this Section 10.9, the Property Trustee agrees, for the benefit of Holders,
that at the expense of the Sponsor, it shall file an answer with the bankruptcy
court or otherwise properly contest the filing of such petition by the Sponsor
against the Issuer Trust or the commencement of such action and raise the
defense that the Sponsor has agreed in writing not to take such action and
should be estopped and precluded therefrom and such other defenses, if any, as
counsel for the Issuer Trustees or the Issuer Trust may assert.  The
provisions of this Section 10.9 shall survive the termination of this Trust
Agreement.

       

      
        
           

        

        
          45

          
            

          

        

        
           

        

      

      Section
10.10                                Trust Indenture Act; Conflict with
Trust Indenture Act.

       

      (a)           This
Declaration of Trust is subject to the provisions of the Trust Indenture Act
that are required to be part of this Declaration of Trust and shall, to the
extent applicable, be governed by such provisions.

       

      (b)           The
Property Trustee shall be the only Issuer Trustee that is a trustee for the
purposes of the Trust Indenture Act.

       

      (c)           If
any provision hereof limits, qualifies or conflicts with the duties imposed by
Sections 310 to 317, inclusive, of the Trust Indenture Act through
operation of Section 318(c) thereof, such imposed duties shall
control.  If any provision of this Declaration of Trust modifies or
excludes any provision of the Trust Indenture Act which may be so modified or
excluded, the latter provision shall be deemed to apply to this Declaration of
Trust as so modified or excluded, as the case may be.

       

      (d)           The
application of the Trust Indenture Act to this Declaration of Trust shall not
affect the nature of the Trust Securities as equity securities representing
undivided beneficial interests in the assets of the Issuer Trust.

       

      Section
10.11                                Acceptance of Terms of Declaration
of Trust, Guarantee Agreement and Indenture.  THE RECEIPT AND ACCEPTANCE OF A TRUST
SECURITY OR ANY INTEREST THEREIN BY OR ON BEHALF OF A HOLDER OR ANY BENEFICIAL
OWNER, WITHOUT ANY SIGNATURE OR FURTHER MANIFESTATION OF ASSENT, SHALL
CONSTITUTE THE UNCONDITIONAL ACCEPTANCE BY THE HOLDER AND ALL OTHERS HAVING A
BENEFICIAL INTEREST IN SUCH TRUST SECURITY OF ALL THE TERMS AND PROVISIONS OF
THIS TRUST AGREEMENT, THE GUARANTEE AGREEMENT AND THE INDENTURE, AND AGREEMENT
TO THE SUBORDINATION PROVISIONS AND OTHER TERMS OF THE GUARANTEE AGREEMENT AND
THE INDENTURE, AND SHALL CONSTITUTE THE AGREEMENT OF THE ISSUER TRUST, SUCH
HOLDER AND SUCH OTHERS THAT THE TERMS AND PROVISIONS OF THIS TRUST AGREEMENT
SHALL BE BINDING, OPERATIVE AND EFFECTIVE AS BETWEEN THE ISSUER TRUST AND SUCH
HOLDER AND SUCH OTHERS.

       

      Section
10.12                                Counterparts.  This
instrument may be executed in any number of counterparts, each of which so
executed shall be deemed to be an original, but all such counterparts shall
together constitute one and the same instrument.

       

      [REMAINDER
OF THIS PAGE INTENTIONALLY LEFT BLANK]

       

      
        
           

        

        
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      IN WITNESS WHEREOF, the
parties hereto have executed this Amended and Restated Declaration of
Trust.

       

      
        
          
            
              
                	 	
                         PRIVATEBANCORP,
      INC.

                         as
      Sponsor

                         

                      

              

              
                
                  	 
      	 By:	 /s/Larry D.
      Richman

                

              

              
                
                  	
                        	Name:	
                          Larry
      D. Richman

                        
	 	Title:	
                          President
      and Chief Executive
Officer

                        

                

              

            

          

        

         

        
          
             

            
              
                
                  	 	
                           WILMINGTON
      TRUST COMPANY

                           as
      Property Trustee

                           

                        

                

                
                  
                    	 
      	 By:	 /s/Michael
      H. Wass

                  

                

                
                  
                    	
                          	Name:	
                            
                              Michael
      H. Wass

                            

                          
	 	Title:	
                            
                              Financial
      Services
Officer

                            

                          

                  

                

              

            

          

           

        

        
          
            
               

              
                
                  
                    	 	
                             WILMINGTON
      TRUST COMPANY,

                             as
      Delaware Trustee

                             

                          

                  

                  
                    
                      	 
      	 By:	 /s/Michael
      H. Wass

                    

                  

                  
                    
                      	
                            	Name:	
                              
                                Michael
      H. Wass

                              

                            
	 	Title:	
                              
                                Financial
      Services
Officer

                              

                            

                    

                  

                

              

            

             

          

        

        
          
             

            
              
                
                

                
                  
                    	 
      	 By:	 /s/Larry D.
      Richman

                  

                

                
                  
                    	
                          	Name:	
                            Larry
      D. Richman

                          
	 	 	
                            
                              as
      Administrative
Trustee

                            

                          

                  

                

              

            

          

           

        

        
          
            
               

              
                
                  
                  

                  
                    
                      	 
      	 By:	 /s/Dennis
      L. Klaeser

                    

                  

                  
                    
                      	
                            	Name:	
                              
                                Dennis
      L. Klaeser

                              

                            
	 	 	
                              
                                as
      Administrative
Trustee

                              

                            

                    

                  

                

              

            

             

             

          

        

        
          
            
              
                
                  
                  

                  
                    
                      	 
      	 By:	 /s/Christopher
      J. Zinski

                    

                  

                  
                    
                      	
                            	Name:	
                              
                                
                                  Christopher
      J. Zinski

                                

                              

                            
	 	 	
                              
                                as
      Administrative
Trustee

                              

                            

                    

                  

                

              

            

             

          

        

      

      
        
           

        

        
           

          
            

          

        

        
           

        

      

      Exhibit A

       

      CERTIFICATE
OF TRUST

      OF

      PRIVATEBANCORP
CAPITAL TRUST IV

       

      [Insert
Certificate of Trust]

       

      
        
           

        

        
          A-1

          
            

          

        

        
           

        

      

      Exhibit B

       

      FORM
OF COMMON SECURITIES CERTIFICATE

       

      THIS
CERTIFICATE IS NOT TRANSFERABLE EXCEPT IN COMPLIANCE WITH APPLICABLE LAW AND
SECTION 5.11 OF THE TRUST AGREEMENT AND ONLY IN CONNECTION WITH A
SIMULTANEOUS DELEGATION AND ASSIGNMENT OF THE EXPENSE AGREEMENT REFERRED TO
THEREIN

       

      
        	
                Certificate
      Number

              	
                Number
      of Common Securities

              

      

      

      CAI-

       

      Certificate
Evidencing Common Securities

       

      of

       

      PrivateBancorp
Capital Trust IV

       

      10.00%
Common Securities

       

      (liquidation
amount $25.00 per Common Security)

       

      PrivateBancorp
Capital Trust IV, a statutory trust created under the laws of the State of
Delaware (the “Issuer
Trust”), hereby certifies that PrivateBancorp, Inc. (the “Holder”) is the registered
owner of  common securities of the Issuer Trust representing common
undivided beneficial interests in the assets of the Issuer Trust and designated
the 10.00% Common Securities (liquidation amount $25.00 per Common Security)
(the “Common
Securities”).  Except in accordance with Section 5.11 of
the Declaration of Trust (as defined below), the Common Securities are not
transferable and, to the fullest extent permitted by law, any attempted transfer
hereof other than in accordance therewith shall be void.  The
designations, rights, privileges, restrictions, preferences and other terms and
provisions of the Common Securities are set forth in, and this certificate and
the Common Securities represented hereby are issued and shall in all respects be
subject to the terms and provisions of, the Amended and Restated Declaration of
Trust of the Issuer Trust, dated as of May 22, 2008, as the same may be
amended from time to time (the “Declaration of Trust”), among
PrivateBancorp, Inc., as Sponsor, Wilmington Trust Company, as Property Trustee,
Wilmington Trust Company, as Delaware Trustee, the Administrative Trustees named
therein, and the holders, from time to time, of undivided beneficial interests
in the assets of the Issuer Trust including the designation of the terms of the
Common Securities as set forth therein.  The Issuer Trust will furnish
a copy of the Declaration of Trust to the Holder without charge upon written
request to the Issuer Trust at its principal place of business or registered
office.

       

      Upon
receipt of this certificate, the Holder is bound by the Declaration of Trust and
is entitled to the benefits thereunder.

       

      Terms
used but not defined herein have the meanings set forth in the Declaration of
Trust.

       

      
        
           

        

        
          B-1

          
            

          

        

        
           

        

      

      IN WITNESS WHEREOF, one of the
Administrative Trustees of the Issuer Trust has executed this certificate on
behalf of the Issuer Trust this ____ day of May, 2008.

       

       

      
         

        
          
            
              
                
                  	 	
                           PrivateBancorp
      Capital Trust IV

                           

                        

                

                
                  
                    	 
      	 By:	 

                  

                

                
                  
                    	
                          	Name:	
                             

                          
	 	 	
                            
                              Administrative
      Trustee

                            

                          

                  

                

              

            

          

           

        

      

       

      
        
           

        

        
          B-2

          
            

          

        

        
           

        

      

      Exhibit C

       

      FORM OF
EXPENSE AGREEMENT

       

      AGREEMENT
AS TO EXPENSES AND LIABILITIES

       

      AGREEMENT
AS TO EXPENSES AND LIABILITIES, dated as of May 22, 2008 between
PrivateBancorp, Inc., a Delaware corporation (the “Sponsor”), and PrivateBancorp
Capital Trust IV, a Delaware statutory trust (the “Issuer Trust”).

       

      WHEREAS, the Issuer Trust
intends to issue its Common Securities (the “Common Securities”) to and
acquire Debentures from the Sponsor and to issue and sell 10.00% Preferred
Securities (the “Preferred
Securities”) with such powers, preferences and special rights and
restrictions as are set forth in the Amended and Restated Declaration of Trust
of the Issuer Trust, dated as of May 22 among the Sponsor, as Sponsor,
Wilmington Trust Company, as Property Trustee, Wilmington Trust Company, as
Delaware Trustee, and the Administrative Trustees named therein, as the same may
be amended from time to time (the “Declaration of
Trust”);

       

      WHEREAS, the Sponsor will own
all of the Common Securities of the Issuer Trust and will issue the
Debentures;

       

      WHEREAS, terms used but not
defined herein have the meanings set forth in the Declaration of
Trust;

       

      NOW, THEREFORE, for good and
valid consideration, the receipt and sufficiency of which are hereby
acknowledged:

       

      ARTICLE I

       

      SECTION 1.1.                                Guarantee by the
Sponsor.  Subject to the terms and conditions hereof, the
Sponsor hereby irrevocably and unconditionally guarantees to each person or
entity to whom the Issuer Trust is now or hereafter becomes indebted or liable
(the “Beneficiaries”)
the full payment, when and as due, of any and all Obligations (as hereinafter
defined) to such Beneficiaries.  As used herein, “Obligations” means
any costs, expenses or liabilities of the Issuer Trust, other than obligations
of the Issuer Trust to pay to holders of any Trust Securities the amounts due
such holders pursuant to the terms of the Trust Securities.  This
Agreement is intended to be for the benefit of, and to be enforceable by, all
such Beneficiaries, whether or not such Beneficiaries have received notice
hereof.

       

      SECTION 1.2.                                Subordination of
Guarantee.  The guarantee and other liabilities and obligations
of the Sponsor under this Agreement shall constitute unsecured obligations of
the Sponsor and shall rank subordinate and junior in right of payment to all
Senior Debt (as defined in the Indenture) of the Sponsor to the extent and in
the manner set forth in the Indenture with respect to the Debentures, and the
provisions of Article XIII of the Indenture will apply, mutatis mutandis,
to the obligations of the Sponsor hereunder.  The obligations of the
Sponsor hereunder do not constitute Senior Debt of the Sponsor.

       

      SECTION 1.3.                                Term of
Agreement.  This Agreement shall terminate and be of no further
force and effect upon the later of (a) the date on which full payment has
been made of all amounts payable to all holders of all the Preferred Securities
(whether upon redemption, liquidation, exchange or otherwise) and (b) the
date on which there are no Beneficiaries remaining, provided, however, that this
Agreement shall continue to be effective or shall be reinstated, as the case may
be, if at any time any holder of Preferred Securities or any Beneficiary must
restore payment of any sums paid under the Preferred Securities, under any
Obligation, under the Guarantee Agreement dated the date hereof by the
Sponsor

       

      
        
           

        

        
          C-1

          
            

          

        

        
           

        

      

      and
Wilmington Trust Company, as guarantee trustee, or under this Agreement for any
reason whatsoever.  This Agreement is continuing, irrevocable,
unconditional and absolute.

       

      SECTION 1.4.                                Waiver of
Notice.  The Sponsor hereby waives notice of acceptance of this
Agreement and of any Obligation to which it applies or may apply, and the
Sponsor hereby waives presentment, demand for payment, protest, notice of
nonpayment, notice of dishonor, notice of redemption and all other notices and
demands.

       

      SECTION 1.5.                                No Impairment.  The
obligations, covenants, agreements and duties of the Sponsor under this
Agreement shall in no way be affected or impaired by reason of the happening
from time to time of any of the following:

       

      (a)           the
extension of time for the payment by the Issuer Trust of all or any portion of
the Obligations or for the performance of any other obligation under, arising
out of, or in connection with, the Obligations;

       

      (b)           any
failure, omission, delay or lack of diligence on the part of the Beneficiaries
to enforce, assert or exercise any right, privilege, power or remedy conferred
on the Beneficiaries with respect to the Obligations or any action on the part
of the Issuer Trust granting indulgence or extension of any kind;
or

       

      (c)           the
voluntary or involuntary liquidation, dissolution, sale of any collateral,
receivership, insolvency, bankruptcy, assignment for the benefit of creditors,
reorganization, arrangement, composition or readjustment of debt of, or other
similar proceedings affecting, the Issuer Trust or any of the assets of the
Issuer Trust (other than the liquidation of the Issuer Trust in accordance with
the terms thereof).

       

      There
shall be no obligation of the Beneficiaries to give notice to, or obtain the
consent of, the Sponsor with respect to the happening of any of the
foregoing.

       

      SECTION 1.6.                                Enforcement.  A
Beneficiary may enforce this Agreement directly against the Sponsor and the
Sponsor waives any right or remedy to require that any action be brought against
the Issuer Trust or any other person or entity before proceeding against the
Sponsor.

       

      SECTION 1.7.                                Subrogation.  The
Sponsor shall be subrogated to all rights (if any) of the Issuer Trust in
respect of any amounts paid to the Beneficiaries by the Sponsor under this
Agreement; provided,
however, that the Sponsor shall not (except to the extent required by
mandatory provisions of law) be entitled to enforce or exercise any rights which
it may acquire by way of subrogation or any indemnity, reimbursement or other
agreement, in all cases as a result of payment under this Agreement, if, at the
time of any such payment, any amounts are due and unpaid under this
Agreement.

       

      ARTICLE II

       

      SECTION 2.1.                                Assignment.  This
Agreement may not be assigned by either party hereto without the consent of the
other, and any purported assignment without such consent shall be
void.

       

      SECTION 2.2.                                Binding
Effect.  All guarantees and agreements contained in this
Agreement shall bind the successors, assigns, receivers, trustees and
representatives of the Sponsor and shall inure to the benefit of the
Beneficiaries.

       

      SECTION 2.3.                                Amendment.  So long
as there remains any Beneficiary or any Preferred Securities are outstanding,
this Agreement shall not be modified or amended in any manner adverse
to

       

      
        
           

        

        
          C-2

          
            

          

        

        
           

        

      

      such
Beneficiary or to the holders of the Preferred Securities without the consent of
such Beneficiary or the holders of the Preferred Securities, as the case may
be.

       

      SECTION 2.4.                                Notices.  Any
notice, request or other communication required or permitted to be given
hereunder shall be given in writing by delivering the same against receipt
therefor by facsimile transmission (confirmed by mail), telex or by registered
or certified mail, addressed as follows (and if so given, shall be deemed given
when mailed or upon receipt of an answer-back, if sent by telex):

       

      If given
to the Sponsor:

       

      PrivateBancorp,
Inc.

      70 West
Madison

      Suite
900

      Chicago,
Illinois 60602

      Attention:  General
Counsel

       

      If given
to the Issuer Trust:

       

      PrivateBancorp
Capital Trust IV

      c/o
PrivateBancorp, Inc.

      70 West
Madison

      Suite
900

      Chicago,
Illinois 60602

      Attention:  Administrative
Trustees

       

      SECTION 2.4.                                THIS AGREEMENT SHALL BE GOVERNED BY
AND CONSTRUED AND INTERPRETED IN ACCORDANCE WITH THE LAWS OF THE STATE OF
ILLINOIS.

       

      THIS AGREEMENT is executed as
of the day and year first above written.

       

      
        
           

          
            
              
                
                  
                    	 	
                             PrivateBancorp,
      Inc.

                             

                          

                  

                  
                    
                      	 
      	 By:	 

                    

                  

                  
                    
                      	
                            	Name:	
                               

                            
	 	 Title:	
                              
                                 

                              

                            

                    

                  

                

              

            

             

          

        

      

      
        
          
            
              
                
                  
                    	 	
                             PrivateBancorp
      Capital Trust IV

                             

                          

                  

                  
                    
                      	 
      	 By:	 

                    

                  

                  
                    
                      	
                            	Name:	
                               

                            
	 	 Title:	
                              
                                Administrative
      Trustee

                              

                            

                    

                  

                

              

            

             

          

        

      

      
        
           

        

        
          C-3

          
            

          

        

        
           

        

      

      Exhibit D

       

      FORM
OF PREFERRED SECURITIES CERTIFICATE

       

      IF THE
PREFERRED SECURITIES CERTIFICATE IS TO BE EVIDENCED BY A BOOK-ENTRY PREFERRED
SECURITIES CERTIFICATE, INSERT —This Preferred Securities Certificate is a
Book-Entry Preferred Securities Certificate within the meaning of the
Declaration of Trust hereinafter referred to and is registered in the name of a
Depositary or a nominee of a Depositary.  This Preferred Securities
Certificate is exchangeable for Preferred Securities Certificates registered in
the name of a person other than the Depositary or its nominee only in the
limited circumstances described in the Declaration of Trust and 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, except in the limited circumstances described in the Declaration of
Trust.

       

      Unless
this Preferred Security Certificate is presented by an authorized representative
of The Depository Trust Company, a New York corporation (“DTC”), to PrivateBancorp
Capital Trust IV or its agent for registration of transfer, exchange or payment,
and any Preferred Security Certificate issued is registered in the name of Cede
& Co. or such other name as is requested by an authorized representative of
DTC (and any payment is made to Cede & Co. or to such other entity as is
requested by an authorized representative of DTC), ANY TRANSFER, PLEDGE OR OTHER
USE HEREOF FOR VALUE OR OTHERWISE BY OR TO A PERSON IS WRONGFUL inasmuch as the
registered owner hereof, Cede & Co., has an interest
herein.

       

      
        	
                Certificate
      Number

              	
                Number
      of Preferred Securities

              

      

      

      CAI-

       

      CUSIP
NO.

       

      Certificate
Evidencing Preferred Securities

       

      of

       

      PrivateBancorp
Capital Trust IV

       

      10.00%
Preferred Securities

       

      (liquidation
amount $25 per Preferred Security)

       

      PrivateBancorp
Capital Trust IV, a statutory trust created under the laws of the State of
Delaware (the “Issuer
Trust”), hereby certifies that Cede & Co. (the “Holder”) is the registered
owner of  Preferred Securities of the Issuer Trust representing an
undivided preferred beneficial interest in the assets of the Issuer Trust and
designated the PrivateBancorp Capital Trust IV 10.00% Preferred Securities
(liquidation amount $25.00 per Preferred Security) (the “Preferred
Securities”).  The Preferred Securities are transferable on the
books and records of the Issuer Trust, in person or by a duly authorized
attorney, upon surrender of this certificate duly endorsed and in proper form
for transfer as provided in Section 5.5 of the Declaration of Trust (as
defined below).  The designations, rights, privileges, restrictions,
preferences and other terms and provisions of the Preferred Securities are set
forth in, and this certificate and the Preferred Securities represented hereby
are issued and shall in all respects be subject to the terms and provisions of,
the Amended and Restated Declaration of Trust of the Issuer Trust, dated as of
May 22, 2008, as the same may be amended from time to time (the “Declaration of Trust”), among
PrivateBancorp, Inc., as Sponsor, Wilmington Trust Company, as Property Trustee,
Wilmington Trust Company, as Delaware Trustee, the

       

      
        
           

        

        
          D-1

          
            

          

        

        
           

        

      

      Administrative
Trustees named therein, and the holders, from time to time of undivided
beneficial interests in the assets of the Issuer Trust including the designation
of the terms of the Preferred Securities as set forth therein.  The
Holder is entitled to the benefits of the Guarantee Agreement entered into by
PrivateBancorp, Inc., a Delaware corporation, and Wilmington Trust Company, as
guarantee trustee, dated as of May 22, 2008, as the same may be amended
from time to time (the “Guarantee Agreement”), to the
extent provided therein.  The Issuer Trust will furnish a copy of the
Declaration of Trust and the Guarantee Agreement to the Holder without charge
upon written request to the Issuer Trust at its principal place of business or
registered office.

       

      Upon
receipt of this certificate, the Holder is bound by the Declaration of Trust and
is entitled to the benefits thereunder.

       

      IN WITNESS WHEREOF, one of the
Administrative Trustees of the Issuer Trust has executed this certificate on
behalf of the Issuer Trust this _________ day of May, 2008.

       

      
        
          
             

            
              
                
                  
                    
                      	 	
                               PrivateBancorp
      Capital Trust IV

                               

                            

                    

                    
                      
                        	 
      	 By:	 

                      

                    

                    
                      
                        	
                              	Name:	
                                 

                              
	 	 Title:	
                                
                                  Administrative
      Trustee

                                

                              

                      

                    

                  

                

              

               

              This is one of the Preferred Securities referred
to in the within-mentioned Declaration of Trust.

               

            

          

        

        
          
            
              
                
                  
                    
                      	 	
                              Wilmington
      Trust Company,

                              as Property
      Trustee

                               

                            

                    

                    
                      
                        	 
      	 By:	 

                      

                    

                    
                      
                        	
                              	Name:	
                                 

                              
	 	 Title:	
                                
                                  Authorized
      Officer

                                

                              

                      

                    

                  

                

              

               

              

                
                  
                     

                  

                  
                    D-2

                    
                      

                    

                  

                  
                     

                  

                

            

          

        

      

      ASSIGNMENT

       

      FOR VALUE RECEIVED, the
undersigned assigns and transfers this Preferred Security to:

       

       

      
        
          

        

      

      (Insert
assignee’s social security or tax identification number)

       

       

      
        
          

        

      

      (Insert
address and zip code of assignee)

       

      
         

        
          	 and
      irrevocably appoints  	 

        

         

          
            

          

        

      

                                                                                                                                              

      agent to
transfer this Preferred Securities Certificate on the books of the Issuer
Trust.  The agent may substitute another to act for him or
her.

       

      Date:__________

       

      
        
          	 Signature:	 

        

        (Sign
exactly as your name appears on the other side of this Preferred Securities
Certificate)

      

       

      The
signature(s) should be guaranteed by an eligible guarantor institution (banks,
stockbrokers, savings and loan associations and credit unions with membership in
an approved signature guarantee medallion program), pursuant to S.E.C. Rule
17Ad-15.

       

       

      
        
          
          

        

        
          D-3

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