Document:

Exhibit 10.1 to NSE FORM 10-K 2005 Note Purchase Agreement

NU SKIN ENTERPRISES,
INC. 

JP¥9,706,500,000 

3.03% Senior Notes due
October 12, 2010 

     _________________ 

NOTE PURCHASE AGREEMENT 

     _________________ 

Dated October 12, 2000 

NU SKIN ENTERPRISES,
INC. 

One Nu Skin Plaza 

75 West Center Street 

Provo, Utah 84601 

3.03% Senior Notes due
October 12, 2010 

October 12, 2000 

TO THE PURCHASER LISTED IN 

THE ATTACHED SCHEDULE A: 

Ladies and Gentlemen: 

Nu Skin Enterprises, Inc., a Delaware
corporation (the “Company”), agrees with you as follows: 

1.         AUTHORIZATION OF
NOTES. 

The Company will authorize the issue
and sale of JP¥ 9,706,500,000 aggregate principal amount of its Senior Notes due
October 12, 2010 (the “Notes”, such term to include any such notes issued
in substitution therefor pursuant to Section 13 of this Agreement). The Notes shall be
substantially in the form set out in Exhibit 1, with such changes therefrom, if
any, as may be approved by you and the Company. The Notes shall at all times be guaranteed
by all current and future Material Domestic Subsidiaries of the Company (the
“Subsidiary Guarantors”) pursuant to the Subsidiary Guaranty and
shall at all times be secured by a pledge of the Pledged Securities of each Material
Foreign Subsidiary pursuant to the Pledge Agreement. Certain capitalized terms used in
this Agreement are defined in Schedule B; references to a “Schedule” or
an “Exhibit” are, unless otherwise specified, to a Schedule or an Exhibit
attached to this Agreement. 

2.         SALE AND PURCHASE OF
NOTES. 

Subject to the terms and conditions
of this Agreement and the Collateral Documents, the Company will issue and sell to you and
you will purchase from the Company, at the Closing provided for in Section 3, Notes in the
principal amount specified opposite your name in Schedule A at the purchase price
of 100% of the principal amount thereof. 

3.         CLOSING. 

The sale and purchase of the Notes to
be purchased by you shall occur at the offices of O’Melveny & Myers LLP, 400
South Hope Street, Los Angeles, California 90071, at 8:00 a.m., Los Angeles time, at a
closing (the “Closing”) on October 12, 2000. At the Closing the Company
will deliver to you the Notes to be purchased by you in the form of a single Note (or such
greater number of Notes in denominations of at least the Yen-equivalent of $100,000 as you
may request) dated the date of the Closing and registered in your name (or in the name of
your nominee), against delivery by you to the Company or its order of immediately
available funds in the amount of the purchase price therefor by wire transfer of
immediately available funds as set forth in a funding instruction letter delivered by the
Company to you at least two Business Days prior to the Closing. If at the Closing the
Company shall fail to tender such Notes to you as provided above in this Section 3, or any
of the conditions specified in Section 4 shall not have been fulfilled to your
satisfaction, you shall, at your election, be relieved of all further obligations under
this Agreement, without thereby waiving any rights you may have by reason of such failure
or such nonfulfillment. 

4.         CONDITIONS TO CLOSING. 

Your obligation to purchase and pay
for the Notes to be sold to you at the Closing is subject to the fulfillment to your
satisfaction, prior to or at the Closing, of the following conditions: 

4.1         Representations and
Warranties. 

The representations and warranties of
the Company in this Agreement and the Collateral Documents shall be correct in all
material respects when made and at the time of the Closing. 

4.2         Performance; No
Default. 

The Company and its Restricted
Subsidiaries shall have performed and complied in all material respects with all
agreements and conditions contained in this Agreement and the Collateral Documents
required to be performed or complied with by them prior to or at the Closing and after
giving effect to the issue and sale of the Notes (and the application of the proceeds
thereof as contemplated by Section 5.14) no Default or Event of Default shall have
occurred and be continuing. Neither the Company nor any Restricted Subsidiary shall have
entered into any transaction since the date of the Memorandum that would have been
prohibited by Section 10 hereof had such Section applied since such date. 

4.3         Officer’s
Certificate. 

The Company shall have delivered to
you an Officer’s Certificate, dated the date of the Closing, certifying that the
conditions specified in Sections 4.1, 4.2, 4.9, 4.13(a) and 4.13(b) have been fulfilled. 

4.4         Opinions of Counsel. 

You shall have received opinions in
form and substance satisfactory to you, dated the date of the Closing (a) from
Shearman & Sterling, special New York counsel for the Company and the Subsidiary
Guarantors, substantially in the form set forth in Exhibit 4.4(a) and covering such
other matters incident to the transactions contemplated hereby as you or your counsel may
reasonably request (and the Company and the Subsidiary Guarantors hereby instruct Shearman
& Sterling to deliver such opinion to you), (b) from Tokyo Aoyama Law Office,
special Japanese counsel for the Company and Nu Skin Japan Co., Ltd., substantially in the
form set forth in Exhibit 4.4(b) and covering such other matters incident to the
transactions contemplated hereby as you or your counsel may reasonably request (and the
Company and the Subsidiary Guarantors hereby instruct Tokyo Aoyama Law Office to deliver
such opinion to you, (c) from the Company’s and the Subsidiary
Guarantors’ in-house counsel, substantially in the form set forth in Exhibit
4.4(c) and covering such other matters incident to the transactions contemplated
hereby as you or your counsel may reasonably request (and the Company hereby instructs its
in-house counsel to deliver such opinion to you), and (d)  from O’Melveny
& Myers LLP, your special counsel in connection with such transactions, substantially
in the form set forth in Exhibit 4.4(d) and covering such other matters incident to
such transactions as you may reasonably request. 

4.5         Purchase Permitted
By Applicable Law, etc. 

On the date of the Closing your
purchase of Notes shall (i) be permitted by the laws and regulations of each
jurisdiction to which you are subject, without recourse to provisions (such as Section
1405(a)(8) of the New York Insurance Law) permitting limited investments by insurance
companies without restriction as to the character of the particular investment,
(ii) not violate any applicable law or regulation (including, without
limitation, Regulation T, U or X of the Board of Governors of the Federal Reserve System),
and (iii) not subject you to any tax, penalty or liability under or pursuant
to any applicable law or regulation, which law or regulation was not in effect on the date
hereof. If requested by you, you shall have received an Officer’s Certificate
certifying as to such matters of fact as you may reasonably specify to enable you to
determine whether such purchase is so permitted. 

4.6         [Reserved]. 

4.7         Payment of Special
Counsel Fees. 

Without limiting the provisions of
Section 15.1, the Company shall have paid on or before the Closing the fees, charges
and disbursements of your special counsel referred to in Section 4.4 to the extent
reflected in a statement of such counsel rendered to the Company at least one Business Day
prior to the Closing. 

4.8         Private Placement
Number. 

A Private Placement Number issued by
Standard & Poor’s CUSIP Service Bureau (in cooperation with the Securities
Valuation Office of the National Association of Insurance Commissioners) shall have been
obtained for the Notes. 

4.9         Changes in Corporate
Structure. 

Except as specified in Schedule
4.9, the Company shall not have changed its jurisdiction of incorporation or been a
party to any merger or consolidation and shall not have succeeded to all or any
substantial part of the liabilities of any other entity, at any time following the date of
the most recent financial statements referred to in Schedule 5.5. 

4.10         Proceedings and
Documents. 

All corporate and other proceedings
in connection with the transactions contemplated by this Agreement, the Collateral
Documents and all documents and instruments incident to such transactions shall be
satisfactory to you and your special counsel, and you and your special counsel shall have
received all such counterpart originals or certified or other copies of such documents as
you or they may reasonably request. 

4.11         Delivery of Company
Documents. 

On or before the date of the Closing,
the Company shall have delivered to you and your special counsel each, unless otherwise
noted, dated the date of the Closing: 

     (a)    
          Certified copies of the Company’s Certificate of Incorporation, together
          with a good standing certificate from the Secretary of State of the State of
          Delaware, each to be dated a recent date prior to the date of the Closing; 

     (b)    
          Copies of the Company’s Bylaws, certified as of the date of the Closing by
          its corporate secretary or an assistant secretary; 

     (c)    
          Resolutions of the Board of Directors of the Company approving and authorizing
          the execution, delivery and performance of the Notes, this Agreement, the
          Collateral Documents to which the Company is a party and any other documents,
          instruments and certificates required to be executed by the Company in
          connection therewith, each certified by the Company’s corporate secretary
          or an assistant secretary as being in full force and effect without modification
          or amendment; 

     (d)    
          Signature and incumbency certificates of the officers of the Company executing
          the documents referred to in item (c) above, and any other documents,
          instruments and certificates required to be executed by the Company in
          connection herewith or therewith; and 

     (e)    
          Such other documents as you or your special counsel may reasonably request. 

4.12         Delivery of
Subsidiary Guarantor Documents. 

On or before the date of the Closing,
each Subsidiary Guarantor shall have delivered to you and your special counsel each,
unless otherwise noted, dated the date of the Closing: 

     (a)    
          Certified copies of such Subsidiary Guarantor’s Articles or Certificate of
          Incorporation, together with a good standing certificate from the Secretary of
          State of the State of the jurisdiction of its incorporation, each to be dated as
          of a recent date prior to the date of Closing; 

     (b)    
          Copies of such Subsidiary Guarantor’s Bylaws, certified as of the date of
          the Closing by its corporate secretary or an assistant secretary; 

     (c)    
          Resolutions of the Board of Directors of such Subsidiary Guarantor approving and
          authorizing the execution, delivery and performance of the Subsidiary
          Guaranty and any other documents, instruments and certificates required to be
          executed by such Subsidiary Guarantor in connection therewith, each certified by
          its corporate secretary or an assistant secretary as being in full force and
          effect without modification or amendment; 

     (d)    
          Signature and incumbency certificates of the officers of such Subsidiary
          Guarantor executing the documents referred to in item (c) above, and any other
          documents, instruments and certificates required to be executed by such
          Subsidiary Guarantor in connection therewith; and 

     (e)    
          Such other documents as you or your special counsel may reasonably request. 

4.13        Execution and Delivery of the Subsidiary Guaranty, the Pledge Agreement and the Collateral Agency, Intercreditor Agreement, and the ABN

Amro Release of
Guarantors. 

     (a)    
          On or prior to the date of the Closing, the Subsidiary Guaranty shall have been
          duly executed and delivered by each Subsidiary Guarantor and shall be in full
          force and effect and you shall have received an executed copy thereof. 

     (b)    
          On or prior to the date of the Closing, the Pledge Agreement shall have been
          duly executed and delivered by the Pledgors and the Collateral Agent and shall
          be in full force and effect, you shall have received an executed copy thereof,
          and all actions shall have been taken as may be necessary or desirable to give
          to the Collateral Agent, for the ratable benefit of the holders of the Notes and
          the other Senior Secured Creditors, a valid and perfected first priority Lien on
          and security interest in the Pledged Securities. 

     (c)    
          On or prior to the date of the Closing, the Collateral Agency and Intercreditor
          Agreement shall have been duly executed and delivered by the Collateral Agent,
          you and each of the other Senior Secured Creditors, and shall have been
          acknowledged by the Company and each of its Restricted Subsidiaries, and such
          agreement shall be in full force and effect and you shall have received an
          executed copy thereof. 

     (d)    
          On or prior to the date of the Closing, the ABN Amro Release of Guarantors shall
          have been duly executed and delivered by ABN Amro N.V., releasing Nu Skin Korea,
          Co., Ltd., Nu Skin Korea, Inc. and Nu Skin Japan Co., Ltd. from the ABN Amro
          Subsidiary Guaranty. 

4.14         UCC Searches. 

The Company shall have delivered to
the Collateral Agent certified copies of UCC Requests for Information or copies (Form
UCC-11), or a similar search report certified by a party acceptable to the Collateral
Agent, dated a recent date prior to the Closing, listing all effective financing
statements which name the Company (under its present name and any previous names) as the
debtor and which are filed in any jurisdiction. 

4.15         UCC Financing
Statements. 

The Company shall have delivered to
the Collateral Agent UCC financing statements or other similar instruments or documents,
duly executed by the Company with respect to the Pledged Securities, in appropriate form
for filing under the Uniform Commercial Code as in effect in all jurisdictions as may be
necessary or, in the opinion of the Collateral Agent, desirable to perfect the security
interests created in the Pledged Securities pursuant to the Pledge Agreement. 

5.         REPRESENTATIONS AND
WARRANTIES OF THE COMPANY. 

The Company represents and warrants
to you that: 

5.1         Organization; Power
and Authority. 

The Company is a corporation duly
organized, validly existing and in good standing under the laws of its jurisdiction of
incorporation, and is duly qualified as a foreign corporation and is in good standing in
each jurisdiction in which such qualification is required by law, other than those
jurisdictions as to which the failure to be so qualified or in good standing could not,
individually or in the aggregate, reasonably be expected to have a Material Adverse
Effect. The Company has the corporate power and authority to own or hold under lease the
properties it purports to own or hold under lease, to transact the business it transacts
and proposes to transact, to execute and deliver this Agreement, the Collateral Documents
to which it is a party and the Notes, and to perform the provisions hereof and thereof. 

5.2         Authorization, etc. 

This Agreement, the Notes and the
Collateral Documents to which the Company is a party have been duly authorized by all
necessary corporate action on the part of the Company, and this Agreement and each of the
Collateral Documents to which it is a party constitutes, and upon execution and delivery
thereof each Note will constitute, a legal, valid and binding obligation of the Company
enforceable against the Company in accordance with its terms, except as such
enforceability may be limited by (a) applicable bankruptcy, insolvency,
reorganization, moratorium or other similar laws affecting the enforcement of
creditors’ rights generally, and (b) general principles of equity (regardless
of whether such enforceability is considered in a proceeding in equity or at law). 

5.3         Disclosure. 

The Company, through its agent, Banc
of America Securities LLC, has delivered to you a copy of a Private Placement Memorandum,
dated September, 2000 (the “Memorandum”), relating to the transactions
contemplated hereby. The Memorandum fairly describes, in all material respects, the
general nature of the business and principal properties of the Company and the Restricted
Subsidiaries. Except as disclosed in Schedule 5.3, this Agreement, the Collateral
Documents, the Memorandum, the documents, certificates or other writings delivered to you
by or on behalf of the Company in connection with the transactions contemplated hereby and
the financial statements listed in Schedule 5.5, taken as a whole, do not
contain any untrue statement of a material fact or omit to state any material fact
necessary to make the statements therein not misleading in light of the circumstances
under which they were made. Except as disclosed in the Memorandum, the Form 10-K filed by
the Company with the Securities and Exchange Commission for the period ended December 31,
1999 or in any Form 10-Q, Form 8-K or other report filed by the Company with the
Securities and Exchange Commission for any period subsequent to the period ended December
31, 1999 or as expressly described in Schedule 5.3 or in one of the documents,
certificates or other writings identified therein, or in the financial statements listed
in Schedule 5.5, since December 31, 1999, there has been no change in the financial
condition, operations, business, properties or prospects of the Company or any Subsidiary
except changes that individually or in the aggregate could not reasonably be expected to
have a Material Adverse Effect. There is no fact known to the Company that could
reasonably be expected to have a Material Adverse Effect that has not been set forth
herein or in the Memorandum or in the other documents, certificates and other writings
delivered to you by or on behalf of the Company. 

5.4         Organization and
Ownership of Shares of Subsidiaries; Affiliates. 

     (a)    
          Schedule 5.4 contains (except as noted therein) complete and correct
          lists (i) of the Company’s Subsidiaries, showing, as to each
          Subsidiary, the correct name thereof, the jurisdiction of its organization, the
          percentage of shares of each class of its capital stock or similar equity
          interests outstanding owned by the Company and each other Subsidiary and whether
          such Subsidiary is a Restricted Subsidiary or an Unrestricted Subsidiary, and
          whether such Subsidiary is a Material Subsidiary, (ii) of the
          Company’s Affiliates, other than Subsidiaries, and (iii) of the
          Company’s directors and senior officers. 

     (b)    
          All of the outstanding shares of capital stock or similar equity interests of
          each Subsidiary shown in Schedule 5.4 as being owned by the Company and
          its Subsidiaries have been validly issued, are fully paid and nonassessable and
          are owned by the Company or another Subsidiary free and clear of any Lien
          (except for Permitted Liens, directors’ qualifying shares, shares required
          to be owned by Persons pursuant to applicable foreign laws regarding foreign
          ownership, or as otherwise disclosed in Schedule 5.4). 

     (c)    
          Each Subsidiary identified in Schedule 5.4 is a corporation or other
          legal entity duly organized, validly existing and in good standing under the
          laws of its jurisdiction of organization, and is duly qualified as a foreign
          corporation or other legal entity and is in good standing in each jurisdiction
          in which such qualification is required by law, other than those jurisdictions
          as to which the failure to be so qualified or in good standing could not,
          individually or in the aggregate, reasonably be expected to have a Material
          Adverse Effect. Each such Subsidiary has the corporate or other power and
          authority to own or hold under lease the properties it purports to own or hold
          under lease and to transact the business it transacts and proposes to transact. 

     (d)    
          No Material Subsidiary, is a party to, or otherwise subject to any legal
          restriction or any agreement (other than this Agreement, the agreements listed
          on Schedule 5.4 and customary limitations imposed by corporate law
          statutes) restricting the ability of such Material Subsidiary to pay dividends
          out of profits or make any other similar distributions of profits to the Company
          or any of its Subsidiaries that owns outstanding shares of capital stock or
          similar equity interests of such Material Subsidiary. 

5.5         Financial Statements. 

The Company has delivered to you
copies of the financial statements of the Company and the Restricted Subsidiaries listed
on Schedule 5.5. All of said financial statements (including in each case the
related schedules and notes) fairly present in all material respects the consolidated
financial position of the Company and the Restricted Subsidiaries as of the respective
dates specified in such Schedule and the consolidated results of their operations and cash
flows for the respective periods so specified and have been prepared in accordance with
GAAP consistently applied throughout the periods involved except as set forth in the notes
thereto (subject, in the case of any interim financial statements, to normal year-end
adjustments). 

5.6         Compliance with
Laws, Other Instruments, etc. 

The execution, delivery and
performance by the Company of this Agreement, the Collateral Documents to which it is a
party and the Notes will not (i) contravene, result in any breach of, or constitute a
default under, or result in the creation of any Lien in respect of any property of the
Company or any Subsidiary under, any indenture, mortgage, deed of trust, loan, note
purchase or credit agreement, corporate charter or bylaws, or any other Material
agreement, lease or instrument to which the Company or any Subsidiary is bound or by which
the Company or any Subsidiary or any of their respective properties may be bound or
affected, (ii) conflict with or result in a breach of any of the terms, conditions
or provisions of any order, judgment, decree or ruling of any court, arbitrator or
Governmental Authority applicable to the Company or any Subsidiary, or (iii)
violate any provision of any statute or other rule or regulation of any Governmental
Authority applicable to the Company or any Subsidiary. 

5.7         Governmental
Authorizations, etc. 

No consent, approval or authorization
of, or registration, filing or declaration with, any Governmental Authority is required in
connection with the execution, delivery or performance by the Company or any of its
Restricted Subsidiaries of this Agreement, the Collateral Documents or the Notes. 

5.8         Litigation;
Observance of Agreements, Statutes and Orders. 

     (a)    
          Except as disclosed in Schedule 5.8, there are no actions, suits or
          proceedings pending or, to the knowledge of the Company, threatened against or
          affecting the Company or any Subsidiary or any property of the Company or any
          Subsidiary in any court or before any arbitrator of any kind or before or by any
          Governmental Authority that, individually or in the aggregate, could reasonably
          be expected to have a Material Adverse Effect. 

     (b)    
          Neither the Company nor any Restricted Subsidiary is in default under any term
          of any agreement or instrument to which it is a party or by which it is bound,
          or any order, judgment, decree or ruling of any court, arbitrator or
          Governmental Authority or is in violation of any applicable law, ordinance, rule
          or regulation (including without limitation Environmental Laws) of any
          Governmental Authority, which default or violation, individually or in the
          aggregate, could reasonably be expected to have a Material Adverse Effect. 

5.9         Taxes. 

The Company and its Subsidiaries have
filed all tax returns that are required to have been filed in any jurisdiction (other than
those tax returns which individually or collectively are not Material), and have paid all
taxes shown to be due and payable on such returns and all other taxes and assessments
levied upon them or their properties, assets, income or franchises, to the extent such
taxes and assessments have become due and payable and before they have become delinquent,
except for any taxes and assessments (i) the amount of which is not
individually or in the aggregate Material, or (ii) the amount, applicability
or validity of which is currently being contested in good faith by appropriate proceedings
and with respect to which the Company or a Subsidiary, as the case may be, has established
adequate reserves in accordance with GAAP. The Company knows of no basis for any other tax
or assessment that could reasonably be expected to have a Material Adverse Effect. The
charges, accruals and reserves on the books of the Company and its Subsidiaries in respect
of Federal, state or other taxes for all fiscal periods are adequate in accordance with
GAAP. The Federal income tax liabilities of the Company and its Subsidiaries have been
resolved with the Internal Revenue Service and paid for all fiscal years up to and
including the fiscal year ending on December 31, 1996. 

5.10         Title to Property;
Leases. 

The Company and the Restricted
Subsidiaries have good and sufficient title to their respective properties that
individually or in the aggregate are Material, including all such properties reflected in
the most recent audited balance sheet referred to in Section 5.5 or purported to have been
acquired by the Company or any Restricted Subsidiary after said date (except as sold or
otherwise disposed of in the ordinary course of business), in each case free and clear of
Liens prohibited by this Agreement or the Collateral Documents. All leases that
individually or in the aggregate are Material are valid and subsisting and are in full
force and effect in all material respects. 

5.11         Licenses, Permits,
etc. 

Except as disclosed in
Schedule 5.11, 

     (a)    
          the Company and the Restricted Subsidiaries own or possess all licenses,
          permits, franchises, authorizations, patents, copyrights, service marks,
          trademarks and trade names, or rights thereto, that individually or in the
          aggregate are Material, without any known Material conflict with the rights of
          others; 

     (b)    
          to the best knowledge of the Company, no product of the Company infringes in any
          material respect any license, permit, franchise, authorization, patent,
          copyright, service mark, trademark, trade name or other right owned by any other
          Person; and 

     (c)    
          to the best knowledge of the Company, there is no Material violation by any
          Person of any right of the Company or any Restricted Subsidiary with respect to
          any patent, copyright, service mark, trademark, trade name or other right owned
          or used by the Company or any Restricted Subsidiary. 

5.12         Compliance with
ERISA. 

     (a)    
          The Company and each ERISA Affiliate have operated and administered each Plan in
          compliance with all applicable laws except for such instances of noncompliance
          as have not resulted in and could not reasonably be expected to result in a
          Material Adverse Effect. Neither the Company nor any ERISA Affiliate has
          incurred any liability pursuant to Title I or IV of ERISA or the penalty or
          excise tax provisions of the Code relating to employee benefit plans (as defined
          in Section 3 of ERISA), and no event, transaction or condition has occurred or
          exists that could reasonably be expected to result in the incurrence of any such
          liability by the Company or any ERISA Affiliate, or in the imposition of any
          Lien on any of the rights, properties or assets of the Company or any ERISA
          Affiliate, in either case pursuant to Title I or IV of ERISA or to such penalty
          or excise tax provisions or to Section 401(a)(29) or 412 of the Code, other
          than such liabilities or Liens as would not be, individually or in the
          aggregate, Material. 

     (b)    
          Neither the Company nor any ERISA Affiliate maintains a “single employer
          plan” or a Multiemployer Plan that is subject to Title IV of ERISA. 

     (c)    
          The Company and its ERISA Affiliates have not incurred withdrawal liabilities
          (and are not subject to contingent withdrawal liabilities) under
          section 4201 or 4204 of ERISA in respect of Multiemployer Plans that
          individually or in the aggregate are Material. 

     (d)    
          The expected postretirement benefit obligation (determined as of the last day of
          the Company’s most recently ended fiscal year in accordance with Financial
          Accounting Standards Board Statement No. 106, without regard to liabilities
          attributable to continuation coverage mandated by section 4980B of the Code) of
          the Company and its Subsidiaries is not Material or has otherwise been disclosed
          in the most recent consolidated financial statements of the Company and its
          Subsidiaries referenced in Section 5.5 of this Agreement. 

     (e)    
          The execution and delivery of this Agreement and the Collateral Documents and
          the issuance and sale of the Notes hereunder will not involve any transaction
          that is subject to the prohibitions of section 406 of ERISA or in
          connection with which a tax could be imposed pursuant to
          section 4975(c)(1)(A)-(D) of the Code. The representation by the Company in
          the first sentence of this Section 5.12(e) is made in reliance upon and subject
          to the accuracy of your representation in Section 6.2 as to the sources of the
          funds used to pay the purchase price of the Notes to be purchased by you. 

5.13         Private Offering by
the Company. 

Neither the Company nor anyone acting
on its behalf has offered the Notes or any similar securities for sale to, or solicited
any offer to buy any of the same from, or otherwise approached or negotiated in respect
thereof with, any Person other than you and not more than 18 other Institutional
Investors, each of which has been offered the Notes or any similar securities at a private
sale for investment. Neither the Company nor anyone acting on its behalf has taken, or
will take, any action that would subject the issuance or sale of the Notes to the
registration requirements of Section 5 of the Securities Act. 

5.14         Use of Proceeds;
Margin Regulations. 

The Company will apply the proceeds
of the sale of the Notes to repay Indebtedness of the Company and its Subsidiaries
(including repayment in full and termination of the Existing Credit Facility) and for
other general corporate purposes (including repurchases of stock of the Company);
provided that no part of the proceeds from the sale of the Notes hereunder will be
used, directly or indirectly, so as to involve the Company or any holder of a Note in a
violation of Regulation U of the Board of Governors of the Federal Reserve System (12 CFR
221) or Regulation X of said Board (12 CFR 224), or to involve any broker or dealer in a
violation of Regulation T of said Board (12 CFR 220). Margin stock does not constitute
more than 5% of the value of the consolidated assets of the Company and its Subsidiaries
and the Company does not have any present intention that margin stock will constitute more
than 5% of the value of such assets. As used in this Section, the term “margin
stock” shall have the meanings assigned to them in said Regulation U. 

5.15         Existing
Indebtedness; Future Liens. 

     (a)    
          Except as described therein, Schedule 5.15 sets forth a complete and
          correct list of all outstanding Indebtedness, separately listed for each such
          item of Indebtedness of $2,000,000 or more, of the Company and the Restricted
          Subsidiaries as of the date of the Closing. 

     (b)    
          (i) Neither the Company nor any Restricted Subsidiary is in default in the
          payment of any principal or interest on any Indebtedness of the Company or such
          Restricted Subsidiary, and (ii) no event or condition exists with respect to any
          Indebtedness of the Company or any Restricted Subsidiary that would permit (or
          that with notice or the lapse of time, or both, would permit) one or more
          Persons to cause such Indebtedness to become due and payable before its stated
          maturity or before its regularly scheduled dates of payment, except for
          Indebtedness described in clauses (i) and (ii) which, in aggregate principal
          amount, does not exceed $5,000,000. 

     (c)    
          Neither the Company nor any Restricted Subsidiary has agreed or consented to
          cause or permit in the future (upon the happening of a contingency or otherwise)
          any of its property, whether now owned or hereafter acquired, to be subject to a
          Lien not permitted by Section 10.3. 

5.16         Foreign Assets
Control Regulations, etc. 

Neither the sale of the Notes by the
Company hereunder nor its use of the proceeds thereof will violate the Trading with the
Enemy Act, as amended, or any of the foreign assets control regulations of the United
States Treasury Department (31 CFR, Subtitle B, Chapter V, as amended) or any enabling
legislation or executive order relating thereto. 

5.17         Status under
Certain Statutes. 

Neither the Company nor any
Restricted Subsidiary is subject to regulation under the Investment Company Act of 1940,
as amended, the Public Utility Holding Company Act of 1935, as amended, the Interstate
Commerce Act, as amended, or the Federal Power Act, as amended. 

5.18         Environmental
Matters. 

Neither the Company nor any of its
Subsidiaries has knowledge of any claim or has received any notice of any claim, and no
proceeding has been instituted raising any claim against the Company or any of its
Subsidiaries or any of their respective real properties now or formerly owned, leased or
operated by any of them or other assets, alleging any damage to the environment or
violation of any Environmental Laws, except, in each case, such as could not reasonably be
expected to result in a Material Adverse Effect. Except as otherwise disclosed to you in
writing, 

     (a)    
          neither the Company nor any of its Subsidiaries has knowledge of any facts which
          would give rise to any claim, public or private, of violation of Environmental
          Laws or damage to the environment emanating from, occurring on or in any way
          related to real properties now or formerly owned, leased or operated by any of
          them or to other assets or their use, except, in each case, such as could not
          reasonably be expected to result in a Material Adverse Effect; 

     (b)    
          neither the Company nor any of its Subsidiaries has stored any Hazardous
          Materials on real properties now or formerly owned, leased or operated by any of
          them in a manner contrary to any Environmental Laws and has not disposed of any
          Hazardous Materials in a manner contrary to any Environmental Laws, in each case
          in any manner that could reasonably be expected to result in a Material Adverse
          Effect; and 

     (c)    
          all buildings on all real properties now owned, leased or operated by the
          Company or any of its Subsidiaries are in compliance with all applicable
          Environmental Laws, except where failure to comply could not reasonably be
          expected to result in a Material Adverse Effect. 

    6.        
          REPRESENTATIONS OF THE PURCHASER.

6.1         Purchase for
Investment. 

You represent that you are an
institutional “accredited investor” within the meaning of subparagraphs (1),
(2), (3) or (7) of Rule 501(a) promulgated under the Securities Act. You represent that
you are purchasing the Notes for your own account or for one or more separate accounts
maintained by you or for the account of one or more pension or trust funds and not with a
view to the distribution thereof, provided that the disposition of your or their
property shall at all times be within your or their control. You understand that the Notes
have not been registered under the Securities Act and may be resold only if registered
pursuant to the provisions of the Securities Act or if an exemption from registration is
available, except under circumstances where neither such registration nor such an
exemption is required by law, and that the Company is not required to register the Notes. 

6.2         Source of Funds. 

You represent that at least one of
the following statements is an accurate representation as to each source of funds (a
“Source”) to be used by you to pay the purchase price of the Notes to be
purchased by you hereunder: 

     (a)    
          the Source is an “insurance company general account” within the
          meaning of Department of Labor Prohibited Transaction Exemption
          (“PTE”) 95-60 (issued July 12, 1995) and there is no employee benefit
          plan, treating as a single plan all plans maintained by the same employer or
          employee organization, with respect to which the amount of the general account
          reserves and liabilities for all contracts held by or on behalf of such plan,
          exceed ten percent (10%) of the total reserves and liabilities of such general
          account (exclusive of separate account liabilities) plus surplus, as set forth
          in the NAIC Annual Statement filed with your state of domicile; or 

     (b)    
          the Source is either (i) an insurance company pooled separate account, within
          the meaning of PTE 90-1 (issued January 29, 1990), or (ii) a bank collective
          investment fund, within the meaning of the PTE 91-38 (issued July 12, 1991) and,
          except as you have disclosed to the Company in writing pursuant to this
          paragraph (b), no employee benefit plan or group of plans maintained by the same
          employer or employee organization beneficially owns more than 10% of all assets
          allocated to such pooled separate account or collective investment fund; or 

     (c)    
          the Source constitutes assets of an “investment fund” (within the
          meaning of Part V of the QPAM Exemption) managed by a “qualified
          professional asset manager” or “QPAM” (within the meaning of Part
          V of the QPAM Exemption), no employee benefit plan’s assets that are
          included in such investment fund, when combined with the assets of all other
          employee benefit plans established or maintained by the same employer or by an
          affiliate (within the meaning of Section V(c)(1) of the QPAM Exemption) of such
          employer or by the same employee organization and managed by such QPAM, exceed
          20% of the total client assets managed by such QPAM, the conditions of Part I(c)
          and (g) of the QPAM Exemption are satisfied, neither the QPAM nor a person
          controlling or controlled by the QPAM (applying the definition of
          “control” in Section V(e) of the QPAM Exemption) owns a 5% or more
          interest in the Company and (i) the identity of such QPAM and
          (ii) the names of all employee benefit plans whose assets are
          included in such investment fund have been disclosed to the Company in writing
          pursuant to this paragraph (c); or 

     (d)    
          the Source is a governmental plan; or 

     (e)    
          the Source does not include assets of any employee benefit plan, other than a
          plan exempt from the coverage of ERISA. 

As used in this Section 6.2, the
terms “employee benefit plan”, “governmental plan” and
“separate account” shall have the respective meanings assigned to such
terms in Section 3 of ERISA. 

7.         INFORMATION AS TO
COMPANY. 

7.1         Financial and
Business Information. 

The Company shall deliver to each
holder of Notes that is an Institutional Investor: 

     (a)    
          Quarterly Statements — within 60 days (or if sooner, on the date
          consolidated statements are required to be delivered to any other creditor of
          the Company) after the end of each quarterly fiscal period in each fiscal year
          of the Company (other than the last quarterly fiscal period of each such fiscal
          year), duplicate copies of, 

     (i)    
          a consolidated and a consolidating balance sheet of the Company and its
          Subsidiaries as at the end of such quarter, and 

     (ii)    
          consolidated and consolidating statements of income, changes in
          shareholders’ equity and cash flows of the Company and its Subsidiaries,
          for such quarter and (in the case of the second and third quarters) for the
          portion of the fiscal year ending with such quarter, 

setting forth in each case in
comparative form the figures for the corresponding periods in the previous fiscal year,
all in reasonable detail, prepared in accordance with GAAP applicable to quarterly
financial statements generally, and certified by a Senior Financial Officer as fairly
presenting, in all material respects, the financial position of the companies being
reported on and their results of operations and cash flows, subject to changes resulting
from year-end adjustments; provided that delivery within the time period specified
above of copies of the Company’s Quarterly Report on Form 10-Q prepared in compliance
with the requirements therefor and filed with the Securities and Exchange Commission shall
be deemed to satisfy the requirements of this Section 7.1(a) to provide consolidated
financial statements so long as such Quarterly Report on Form 10-Q includes the
consolidated financial statements identified in clauses (i) and (ii) above;
provided further that such consolidating financial statements shall show the
elimination of all Unrestricted Subsidiaries and the resultant consolidated financial
statements of the Company and its Restricted Subsidiaries; 

     (b)    
          Annual Statements — within 120 days (or if sooner, on the date
          consolidated statements are required to be delivered to any other creditor of
          the Company) after the end of each fiscal year of the Company, duplicate copies
          of, 

     (i)    
          a consolidated and a consolidating balance sheet of the Company and its
          Subsidiaries, as at the end of such year, and 

     (ii)    
          consolidated and consolidating statements of income, changes in
          shareholders’ equity and cash flows of the Company and its Subsidiaries,
          for such year, 

setting forth in each case in
comparative form the figures for the previous fiscal year, all in reasonable detail,
prepared in accordance with GAAP, which consolidated financial statements shall be
accompanied by an opinion thereon of independent certified public accountants of
recognized national standing, which opinion shall state that such consolidated financial
statements present fairly, in all material respects, the financial position of the
companies being reported upon and their results of operations and cash flows and have been
prepared in conformity with GAAP, and that the examination of such accountants in
connection with such consolidated financial statements has been made in accordance with
generally accepted auditing standards, and that such audit provides a reasonable basis for
such opinion in the circumstances, and which consolidating financial statements shall be
certified by a Senior Financial Officer as fairly presenting, in all material respects,
the financial position of the companies being reported on and their results of operations
and cash flows, subject to changes resulting from year-end adjustments; provided
that the delivery within the time period specified above of the Company’s Annual
Report on Form 10-K for such fiscal year (together with the Company’s annual report
to shareholders, if any, prepared pursuant to Rule 14a-3 under the Exchange Act) prepared
in accordance with the requirements therefor and filed with the Securities and Exchange
Commission shall be deemed to satisfy the requirements of this Section 7.1(b) to provide
consolidated financial statements so long as such Annual Report on Form 10-K includes the
consolidated financial statements identified in clauses (i) and (ii) above;
provided further that such consolidating financial statements shall show the
elimination of all Unrestricted Subsidiaries and the resultant consolidated financial
statements of the Company and its Restricted Subsidiaries; 

     (c)    
          SEC and Other Reports — promptly upon their becoming available, one
          copy of (i) each financial statement, report, notice or proxy statement
          sent by the Company or any Subsidiary to public securities holders generally,
          and (ii) each regular or periodic report, each registration
          statement (without exhibits except as expressly requested by such holder), and
          each prospectus and all amendments thereto filed by the Company or any
          Subsidiary with the Securities and Exchange Commission and of all press releases
          and other statements made available generally by the Company or any Material
          Domestic Subsidiary to the public concerning developments that are Material; 

     (d)    
          Notice of Default or Event of Default — promptly, and in any event
          within five days, after a Responsible Officer becoming aware of the existence of
          any Default or Event of Default or that any Person has given any notice or taken
          any action with respect to a claimed default hereunder or that any Person has
          given any notice or taken any action with respect to a claimed default of the
          type referred to in Section 11(f), a written notice specifying the nature and
          period of existence thereof and what action the Company is taking or proposes to
          take with respect thereto; 

     (e)    
          ERISA Matters — promptly, and in any event within fifteen days after
          a Responsible Officer becoming aware of any of the following, a written notice
          setting forth the nature thereof and the action, if any, that the Company or an
          ERISA Affiliate proposes to take with respect thereto: 

     (i)    
          with respect to any Plan, any reportable event, as defined in
          section 4043(b) of ERISA and the regulations thereunder, for which notice
          thereof has not been waived pursuant to such regulations as in effect on the
          date hereof, which could reasonably be expected to have a Material Adverse
          Effect; or 

     (ii)    
          the taking by the PBGC of steps to institute, or the threatening by the PBGC of
          the institution of, proceedings under section 4042 of ERISA for the
          termination of, or the appointment of a trustee to administer, any Plan, or the
          receipt by the Company or any ERISA Affiliate of a notice from a Multiemployer
          Plan that such action has been taken by the PBGC with respect to such
          Multiemployer Plan, which could reasonably be expected to have a Material
          Adverse Effect; or 

     (iii)    
          any event, transaction or condition that could result in the incurrence of any
          liability by the Company or any ERISA Affiliate pursuant to Title I or IV of
          ERISA or the penalty or excise tax provisions of the Code relating to employee
          benefit plans, or in the imposition of any Lien on any of the rights, properties
          or assets of the Company or any ERISA Affiliate pursuant to Title I or IV of
          ERISA or such penalty or excise tax provisions, if such liability or Lien, taken
          together with any other such liabilities or Liens then existing, could
          reasonably be expected to have a Material Adverse Effect; 

     (f)    
          Notices from Governmental Authority — promptly, and in any event
          within 30 days of receipt thereof, copies of any notice to the Company or any
          Subsidiary from any Federal or state Governmental Authority relating to any
          order, ruling, statute or other law or regulation that could reasonably be
          expected to have a Material Adverse Effect; and 

     (g)    
          Requested Information — with reasonable promptness, such other data
          and information relating to the business, operations, affairs, financial
          condition, assets or properties of the Company or any of its Subsidiaries or
          relating to the ability of the Company to perform its obligations hereunder and
          under the Notes as from time to time may be reasonably requested by any such
          holder of Notes, including without limitation, such information as is required
          by Rule 144A promulgated under the Securities Act to be delivered to a
          prospective transferee of the Notes. 

7.2         Officer’s
Certificate. 

Each set of financial statements
delivered to a holder of Notes pursuant to Section 7.1 hereof shall be accompanied by a
certificate of a Senior Financial Officer setting forth: 

     (a)    
          Covenant Compliance — the information (including detailed
          calculations) required in order to establish whether the Company was in
          compliance with the requirements of Section 10.2 through Section 10.6 hereof,
          inclusive, during the quarterly or annual period covered by the statements then
          being furnished (including with respect to each such Section, where applicable,
          the calculations of the maximum or minimum amount, ratio or percentage, as the
          case may be, permissible under the terms of such Sections, and the calculation
          of the amount, ratio or percentage then in existence); and 

     (b)    
          Event of Default — a statement that such officer has reviewed the
          relevant terms hereof and has made, or caused to be made, under his or her
          supervision, a review of the transactions and conditions of the Company and its
          Subsidiaries from the beginning of the quarterly or annual period covered by the
          statements then being furnished to the date of the certificate and that such
          review shall not have disclosed the existence during such period of any
          condition or event that constitutes a Default or an Event of Default or, if any
          such condition or event existed or exists (including, without limitation, any
          such event or condition resulting from the failure of the Company or any
          Subsidiary to comply with any Environmental Law), specifying the nature and
          period of existence thereof and what action the Company shall have taken or
          proposes to take with respect thereto. 

7.3         Inspection. 

The Company shall permit the
representatives of each holder of Notes that is an Institutional Investor: 

     (a)    
          No Default — if no Default or Event of Default then exists, at the
          expense of such holder and upon reasonable prior notice to the Company, to visit
          the principal executive office of the Company, to discuss the affairs, finances
          and accounts of the Company and its Subsidiaries with the Company’s
          officers, and (with the consent of the Company, which consent will not be
          unreasonably withheld) its independent public accountants, and (with the consent
          of the Company, which consent will not be unreasonably withheld) to visit the
          other offices and properties of the Company and each Restricted Subsidiary, all
          at such reasonable times during business hours and as often as may be reasonably
          requested in writing; and 

     (b)    
          Default — if a Default or Event of Default then exists, at the
          expense of the Company to visit and inspect any of the offices or properties of
          the Company or any Subsidiary, to examine all their respective books of account,
          records, reports and other papers, to make copies and extracts therefrom, and to
          discuss their respective affairs, finances and accounts with their respective
          officers and independent public accountants (and by this provision the Company
          authorizes said accountants to discuss the affairs, finances and accounts of the
          Company and its Subsidiaries), all at such reasonable times and as often as may
          be requested. 

   8.        
          PREPAYMENT OF THE NOTES.

8.1         Required Prepayments. 

The Company shall make principal
prepayments on the Notes on the dates and in the amounts set forth below: 

Prepayment
Date Amount

		
	October 12, 2004	 	JP¥1,386,642,857	 
	October 12, 2005	 	JP¥1,386,642,857	 
	October 12, 2006	 	JP¥1,386,642,857	 
	October 12, 2007	 	JP¥1,386,642,858	 
	October 12, 2008	 	JP¥1,386,642,857	 
	October 12, 2009	 	JP¥1,386,642,857	 

; provided that upon any
partial prepayment of the Notes pursuant to Section 8.2 or purchase of the Notes permitted
by Section 8.5, the principal amount of each required prepayment of the Notes
becoming due under this Section 8.1 on and after the date of such prepayment or
purchase, as well as the payment required at maturity, shall be reduced in the same
proportion as the aggregate unpaid principal amount of the Notes is reduced as a result of
such prepayment or purchase. 

8.2         Optional Prepayments
with Make-Whole Amount. 

     (a)    
          Prepayment Amount. The Company may, at its option, upon notice as
          provided below, prepay on any Business Day all, or from time to time any part
          of, the Notes in an amount not less than 5% of the aggregate principal amount of
          the Notes then outstanding in the case of a partial prepayment, at 100% of the
          principal amount so prepaid, plus accrued interest thereon, plus the Make-Whole
          Amount determined for the prepayment date with respect to such principal amount. 

     (b)    
          Notice. The Company will give each holder of Notes written notice of each
          optional prepayment under this Section 8.2 not less than 30 days and not more
          than 60 days prior to the Business Day fixed for such prepayment. Each such
          notice shall specify the prepayment date, the aggregate principal amount of the
          Notes to be prepaid on such date, the principal amount of each Note held by such
          holder to be prepaid (determined in accordance with Section 8.3), and the
          interest to be paid on the prepayment date with respect to such principal amount
          being prepaid, and shall be accompanied by a certificate of a Senior Financial
          Officer as to the estimated Make-Whole Amount due in connection with such
          prepayment (calculated as if the date of such notice were the date of the
          prepayment), setting forth the details of such computation. Two Business Days
          prior to such prepayment, the Company shall deliver to each holder of Notes a
          certificate of a Senior Financial Officer specifying the calculation of such
          Make-Whole Amount as of the specified prepayment date. 

8.3         Allocation of
Partial Prepayments. 

In the case of each partial
prepayment of the Notes, the principal amount of the Notes to be prepaid shall be
allocated among all of the Notes at the time outstanding in proportion, as nearly as
practicable, to the respective unpaid principal amounts thereof not theretofore called for
prepayment. 

8.4         Maturity; Surrender,
etc. 

In the case of each prepayment of
Notes pursuant to this Section 8, the principal amount of each Note to be prepaid shall
mature and become due and payable on the date fixed for such prepayment, together with
interest on such principal amount accrued to such date and the applicable Make-Whole
Amount, if any. From and after such date, unless the Company shall fail to pay such
principal amount when so due and payable, together with the interest and Make-Whole
Amount, if any, as aforesaid, interest on such principal amount shall cease to accrue. Any
Note paid or prepaid in full shall be surrendered to the Company and cancelled and shall
not be reissued, and no Note shall be issued in lieu of any prepaid principal amount of
any Note. 

8.5         Purchase of Notes. 

The Company will not and will not
permit any Affiliate to purchase, redeem, prepay or otherwise acquire, directly or
indirectly, any of the outstanding Notes except upon the payment or prepayment of the
Notes in accordance with the terms of this Agreement and the Notes. The Company will
promptly cancel all Notes acquired by it or any Affiliate pursuant to any payment,
prepayment or purchase of Notes pursuant to any provision of this Agreement and no Notes
may be issued in substitution or exchange for any such Notes. 

8.6         Make-Whole Amount. 

The term “Make-Whole
Amount” means, with respect to any Note, an amount equal to the excess, if any,
of the Discounted Value of the Remaining Scheduled Payments with respect to the Called
Principal of such Note over the amount of such Called Principal; provided that the
Make-Whole Amount may in no event be less than zero. For the purposes of determining the
Make-Whole Amount, the following terms have the following meanings: 

“Called Principal”
means, with respect to any Note, the principal of such Note that is to be prepaid pursuant
to Section 8.2 or has become or is declared to be immediately due and payable
pursuant to Section 12.1, as the context requires. 

“Discounted Value”
means, with respect to the Called Principal of any Note, the amount obtained by
discounting all Remaining Scheduled Payments with respect to such Called Principal from
their respective scheduled due dates to the Settlement Date with respect to such Called
Principal, in accordance with accepted financial practice and at a discount factor
(applied on the same periodic basis as that on which interest on the Notes is payable)
equal to the Reinvestment Yield with respect to such Called Principal. 

“Reinvestment Yield”
means, with respect to the Called Principal of any Note, (i) the rate of the benchmark
Japanese Government Bond reported, as of 10:00 a.m. (New York time)on the second Business
Day preceding the Settlement Date with respect to such Called Principal, on the display
designated as “Page 0#JPBMK=” on the Reuters Screen (or such other display as
may replace “Page 0#JPBMK=” on the Reuters Screen) for the benchmark Japanese
Government Bond having a maturity equal to the Remaining Average Life of such Called
Principal as of such Settlement Date, or (ii) if such rate is note reported as of such
time or the rate reported is not ascertainable, the average of the rates as determined by
at least three recognized market makers in the Japanese Government Bond market. Such rate
will be determined, if necessary, by interpolating linearly between (1) the benchmark
Japanese Government Bond with the maturity closest to and greater than the Remaining
Average life, and (2) the benchmark Japanese Government Bond with the maturity closest to
and less than the Remaining Average Life. 

“Remaining Average
Life” means, with respect to any Called Principal, the number of years
(calculated to the nearest one-twelfth year) obtained by dividing (i) such Called
Principal into (ii) the sum of the products obtained by multiplying (a) the
principal component of each Remaining Scheduled Payment with respect to such Called
Principal by (b) the number of years (calculated to the nearest one-twelfth year)
that will elapse between the Settlement Date with respect to such Called Principal and the
scheduled due date of such Remaining Scheduled Payment. 

“Remaining Scheduled
Payments” means, with respect to the Called Principal of any Note, all payments
of such Called Principal and interest thereon that would be due after the Settlement Date
with respect to such Called Principal if no payment of such Called Principal were made
prior to its scheduled due date, provided that if such Settlement Date is not a
date on which interest payments are due to be made under the terms of the Notes, then the
amount of the next succeeding scheduled interest payment will be reduced by the amount of
interest accrued to such Settlement Date and required to be paid on such Settlement Date
pursuant to Section 8.2 or 12.1. 

“Settlement Date”
means, with respect to the Called Principal of any Note, the date on which such Called
Principal is to be prepaid pursuant to Section 8.2 or has become or is declared to be
immediately due and payable pursuant to Section 12.1, as the context requires. 

9.         AFFIRMATIVE COVENANTS. 

The Company covenants that so long as
any of the Notes are outstanding: 

9.1         Compliance with Law. 

The Company will and will cause each
of its Subsidiaries to comply with all laws, ordinances or governmental rules or
regulations to which each of them is subject, including, without limitation, Environmental
Laws, and will obtain and maintain in effect all licenses, certificates, permits,
franchises and other governmental authorizations necessary to the ownership of their
respective properties or to the conduct of their respective businesses, in each case to
the extent necessary to ensure that non-compliance with such laws, ordinances or
governmental rules or regulations or failures to obtain or maintain in effect such
licenses, certificates, permits, franchises and other governmental authorizations could
not, individually or in the aggregate, reasonably be expected to have a Material Adverse
Effect. 

9.2         Insurance. 

The Company will and will cause each
of the Restricted Subsidiaries to maintain, with financially sound and reputable insurers,
insurance with respect to their respective properties and businesses against such
casualties and contingencies, of such types, on such terms and in such amounts (including
deductibles, co-insurance and self-insurance, if adequate reserves are maintained with
respect thereto) as is customary in the case of entities of established reputations
engaged in the same or a similar business and similarly situated. 

9.3         Maintenance of
Properties. 

The Company will and will cause each
of the Restricted Subsidiaries to maintain and keep, or cause to be maintained and kept,
their respective properties in good repair, working order and condition (other than
ordinary wear and tear), so that the business carried on in connection therewith may be
properly conducted at all times, provided that this Section shall not prevent the
Company or any Restricted Subsidiary from discontinuing the operation and the maintenance
of any of its properties if such discontinuance is desirable in the conduct of its
business and the Company has concluded that such discontinuance could not, individually or
in the aggregate, reasonably be expected to have a Material Adverse Effect. 

9.4         Payment of Taxes and
Claims. 

The Company will and will cause each
of its Subsidiaries to file all tax returns required to be filed in any jurisdiction and
to pay and discharge all taxes shown to be due and payable on such returns and all other
taxes, assessments, governmental charges, or levies imposed on them or any of their
properties, assets, income or franchises, to the extent such taxes and assessments have
become due and payable and before they have become delinquent and all claims for which
sums have become due and payable that have or might become a Lien on properties or assets
of the Company or any Subsidiary, provided that neither the Company nor any
Subsidiary need pay any such tax or assessment or claims if (i) the amount,
applicability or validity thereof is contested by the Company or such Subsidiary on a
timely basis in good faith and in appropriate proceedings, and the Company or such
Subsidiary has established adequate reserves therefor in accordance with GAAP on the books
of the Company or such Subsidiary, or (ii) the nonpayment of all such taxes
and assessments and claims in the aggregate could not reasonably be expected to have a
Material Adverse Effect. 

9.5         Corporate Existence,
etc. 

The Company will at all times
preserve and keep in full force and effect its corporate existence. Subject to Section
10.2, the Company will at all times preserve and keep in full force and effect the
corporate existence of each Restricted Subsidiary (unless merged into the Company or a
Restricted Subsidiary) and all rights and franchises of the Company and the Restricted
Subsidiaries unless, in the good faith judgment of the Company, the termination of or
failure to preserve and keep in full force and effect such corporate existence, right or
franchise could not, individually or in the aggregate, have a Material Adverse Effect. 

9.6         Security; Execution
of Pledge Agreement and Subsidiary Guaranty. 

     (a)    
          The Notes and other Senior Secured Indebtedness will be secured by the Pledged
          Securities of each Material Foreign Subsidiary. Within 5 days after the Company
          or any of its Restricted Subsidiaries acquires a Material Foreign Subsidiary or
          within 5 days after the Company delivers consolidating financial statements
          pursuant to Section 7.1 showing that any of Company’s existing Subsidiaries
          has become a Material Foreign Subsidiary, the Company shall cause the Pledged
          Securities of such Material Foreign Subsidiary to be pledged pursuant to a
          supplement to the Pledge Agreement (unless a pledge of such Pledged Securities
          (x) is legally unobtainable or (y) the consent of a governmental authority is
          required in order to obtain such pledge and such consent has not been obtained
          after the Company’s commercially reasonable efforts to obtain such consent,
          and Company delivers an opinion of outside counsel, in form and substance
          reasonably satisfactory to the holders of the Notes and their counsel, to the
          effect that such pledge was not legally obtainable or such consent was not
          obtained). The Company shall promptly take all actions as may be necessary or
          desirable to give to the Collateral Agent, for the ratable benefit of the
          holders of the Notes and the other Senior Secured Creditors, a valid and
          perfected first priority Lien on and security interest in the Pledged Securities
          of such Material Foreign Subsidiary and shall promptly deliver to the holders of
          the Notes (i) a supplement to the Pledge Agreement executed by each
          Pledgor of the Pledged Securities of such Material Foreign Subsidiary,
          (ii) a certificate executed by the secretary or an assistant secretary of
          each Pledgor as to (a) the incumbency and signatures of the officers of
          such Pledgor executing the supplement to the Pledge Agreement, and (b)
          the fact that the attached resolutions of the Board of Directors of such Pledgor
          authorizing the execution, delivery and performance of the supplement to the
          Pledge Agreement are in full force and effect and have not been modified or
          rescinded, (iii) at the request of a holder of any Note, a favorable
          opinion of counsel, in form and substance reasonably satisfactory to the holders
          of the Notes and their counsel, as to (a) the due organization and good
          standing of such Pledgor, (b) the due authorization, execution and
          delivery by such Pledgor of the supplement to the Pledge Agreement, (c)
          the enforceability of the supplement to the Pledge Agreement, and (d)
          such other matters as the Required Holders may reasonably request, all of the
          foregoing to be satisfactory in form and substance to the holders of the Notes
          and their counsel; provided that the opinion described in this clause
          (iii) may be given by the Company’s in-house counsel and may contain
          reasonable assumptions, if necessary, relating to the fact that such counsel may
          not be admitted to practice law in the applicable jurisdiction, and (iv)
          such other assurances, certificates, documents, consents or opinions as the
          Required Holders reasonably may require. 

     (b)    
          Within 5 days after the Company or any of its Restricted Subsidiaries acquires a
          Material Domestic Subsidiary or within 5 days after the Company delivers
          consolidating financial statements pursuant to Section 7.1 showing that any of
          Company’s existing Subsidiaries has become a Material Domestic Subsidiary
          (but not later than the time when such Material Domestic Subsidiary provides a
          guaranty or co-obligor agreement to the lenders party to any Significant Credit
          Facility) the Company will (x) cause such Material Domestic Subsidiary to
          execute and deliver to the holders of the Notes a counterpart of the Subsidiary
          Guaranty, and (y) if the lenders party to such Significant Credit Facility are
          not then party to the Collateral Agency and Intercreditor Agreement (either
          directly or through their agent) cause such lenders (either directly or through
          their agent) to become party to the Collateral Agency and Intercreditor
          Agreement. The Company shall promptly deliver to the holders of the Notes,
          together with such counterpart of the Subsidiary Guaranty (i) certified
          copies of such Material Domestic Subsidiary’s Articles or Certificate of
          Incorporation, together with a good standing certificate from the Secretary of
          State of the jurisdiction of its incorporation, each to be dated a recent date
          prior to their delivery to the holders of the Notes, (ii) a copy of such
          Material Domestic Subsidiary’s Bylaws, certified by its corporate secretary
          or an assistant corporate secretary as of a recent date prior to their delivery
          to the holders of the Notes, (iii) a certificate executed by the
          secretary or an assistant secretary of such Material Domestic Subsidiary as to
          (a) the incumbency and signatures of the officers of such Material
          Domestic Subsidiary executing the counterpart of the Subsidiary Guaranty, and
          (b) the fact that the attached resolutions of the Board of Directors of
          such Material Domestic Subsidiary authorizing the execution, delivery and
          performance of the counterpart of the Subsidiary Guaranty are in full force and
          effect and have not been modified or rescinded, (iv) at the request of a
          holder of any Note, a favorable opinion of counsel to the Company and such
          Material Domestic Subsidiary, in form and substance reasonably satisfactory to
          the holders of the Notes and their counsel, as to (a) the due
          organization and good standing of such Material Domestic Subsidiary, (b)
          the due authorization, execution and delivery by such Material Domestic
          Subsidiary of the counterpart of the Subsidiary Guaranty, (c) the
          enforceability of the counterpart of the Material Domestic Subsidiary, and
          (d) such other matters as the Required Holders may reasonably request,
          all of the foregoing to be satisfactory in form and substance to the holders of
          the Notes and their counsel; provided, that the opinion described in
          clause (iv) above may be given by the Company’s in-house counsel and
          may contain reasonable assumptions, if necessary, relating to the fact that
          counsel to the Company and such Material Domestic Subsidiary may not be admitted
          to practice law in the applicable jurisdiction, and (v) such other assurances,
          certificates, documents, consents or opinions as the Required Holders reasonably
          may require. 

9.7         Termination of the
Existing Credit Facility and Related Liens. 

Within 5 Business Days of the date of
Closing, the Company will provide you with satisfactory evidence that the Company has (i)
repaid in full all Indebtedness outstanding under the Existing Credit Facility, (ii)
terminated any commitments to lend or make other extensions of credit under the Existing
Credit Facility, (iii) delivered to the Collateral Agent all documents or instruments
necessary to release all Liens securing Indebtedness or other obligations of the Company
under the Existing Credit Facility, and (iv) made arrangements satisfactory to the
Collateral Agent with respect to the cancellation of any letters of credit outstanding
under the Existing Credit Facility. 

10.         NEGATIVE COVENANTS. 

The Company covenants that so long as
any of the Notes are outstanding: 

10.1         Transactions with
Affiliates. 

The Company will not and will not
permit any Restricted Subsidiary to enter into, directly or indirectly, any Material
transaction or Material group of related transactions (including without limitation the
purchase, lease, sale or exchange of properties of any kind or the rendering of any
service) with any Affiliate (other than the Company or another Restricted Subsidiary),
except as approved by a majority of the disinterested directors of the Company, and upon
fair and reasonable terms no less favorable to the Company or such Restricted Subsidiary
than would be obtainable in a comparable arm’s-length transaction with a Person not
an Affiliate; provided that the foregoing restrictions shall not apply to Standard
Securitization Undertakings effected as part of a Permitted Securitization Program. 

10.2         Merger,
Consolidation, Sale of Assets, etc. 

     (a)    
          The Company will not and will not permit any Restricted Subsidiary to
          consolidate with or merge with any other Person unless immediately after giving
          effect to any consolidation or merger no Default or Event of Default would exist
          and: 

     (i)    
          in the case of a consolidation or merger of a Restricted Subsidiary, (x) the
          Company or another Restricted Subsidiary is the surviving or continuing
          corporation, (y) the surviving or continuing corporation is or immediately
          becomes a Restricted Subsidiary, or (z) such consolidation or merger, if
          considered as the sale of the assets of such Restricted Subsidiary to such other
          Person, would be permitted by Section 10.2(c); and 

     (ii)    
          in the case of a consolidation or merger of the Company, the successor
          corporation or surviving corporation which results from such
          consolidation or merger (the “surviving corporation”), if not
          the Company, (A) is a solvent U.S. corporation, (B) executes and delivers to
          each holder of the Notes its assumption of (x) the due and punctual payment of
          the principal of and premium, if any, and interest on all of the Notes, and (y)
          the due and punctual performance and observation of all of the covenants in this
          Agreement, the Collateral Documents and the Notes to be performed or observed by
          the Company, and (C) furnishes to each holder of the Notes an opinion of
          counsel, reasonably satisfactory to the Required Holders, to the effect that the
          instrument of assumption has been duly authorized, executed and delivered and
          constitutes the legal, valid and binding contract and agreement of the surviving
          corporation enforceable in accordance with its terms, except as enforcement of
          such terms may be limited by bankruptcy, insolvency, reorganization, moratorium
          and similar laws affecting the enforcement of creditors’ rights generally
          and by general equitable principles. 

     (b)    
          The Company will not sell, lease (as lessor) or otherwise transfer all or
          substantially all of its assets in a single transaction or series of
          transactions to any Person unless immediately after giving effect thereto no
          Default or Event of Default would exist and: 

     (i)    
          the successor corporation to which all or substantially all of the
          Company’s assets have been sold, leased or transferred (the
          “successor corporation”) is a solvent U.S. corporation, and 

     (ii)    
          the successor corporation executes and delivers to each holder of the Notes its
          assumption of the due and punctual payment of the principal of and premium, if
          any, and interest on all of the Notes, and the due and punctual performance and
          observation of all of the covenants in this Agreement, the Collateral Documents
          and the Notes to be performed or observed by the Company and shall furnish to
          such holders an opinion of counsel, reasonably satisfactory to the Required
          Holders, to the effect that the instrument of assumption has been duly
          authorized, executed and delivered and constitutes the legal, valid and binding
          contract and agreement of such successor corporation enforceable in accordance
          with its terms, except as enforcement of such terms may be limited by
          bankruptcy, insolvency, reorganization, moratorium and similar laws affecting
          the enforcement of creditors’ rights generally and by general equitable
          principles. 

No such conveyance, transfer or lease
of all or substantially all of the assets of the Company shall have the effect of
releasing the Company or any successor corporation that shall theretofore have become such
in the manner prescribed in this Section 10.2 from its liability under this Agreement or
the Notes. 

     (c)    
          The Company will not, and will not permit any Restricted Subsidiary to, sell,
          lease (as lessor), transfer, abandon or otherwise dispose of assets to any
          Person; provided that the foregoing restrictions do not apply to: 

     (i)    
          the sale, lease, transfer or other disposition of assets of the Company to a
          Restricted Subsidiary or of a Restricted Subsidiary to the Company or another
          Restricted Subsidiary; 

     (ii)    
          the sale in the ordinary course of business of inventory held for sale, or
          equipment, fixtures, supplies or materials that are no longer required in the
          operation of the business of the Company or any Restricted Subsidiary or are
          obsolete; 

     (iii)    
          the sale of property of the Company or any Restricted Subsidiary and the
          Company’s or any Restricted Subsidiary’s subsequent lease, as lessee,
          of the same property, within 270 days following the acquisition or construction
          of such property; 

     (iv)    
          the sale of assets of the Company or any Restricted Subsidiary for cash or other
          property to a Person or Persons (other than an Affiliate) if (A) such assets
          (valued at net book value) do not constitute a “substantial part” of
          the assets of the Company and the Restricted Subsidiaries, (B) in the opinion of
          a Responsible Officer of the Company, the sale is for fair value and is in the
          best interests of the Company, and (C) immediately after giving effect to the
          transaction, no Default or Event of Default would exist; or 

     (v)    
          the sale of assets meeting the conditions set forth in clauses (B) and (C) of
          subparagraph (iv) above, as long as the net proceeds from such sale in excess of
          a substantial part of the assets of the Company and the Restricted Subsidiaries
          are (x) applied within 270 days of the date of receipt to the acquisition of
          productive assets useful and intended to be used in the operation of the
          business of the Company or the Restricted Subsidiaries, or (y) used to repay any
          Indebtedness of the Company (which in the case of the Notes shall be with the
          Make-Whole Amount) or the Restricted Subsidiaries (other than Indebtedness that
          is in any manner subordinated in right of payment or security in any respect to
          Indebtedness evidenced by the Notes, Indebtedness owing to the Company, any of
          its Subsidiaries or any Affiliate and Indebtedness in respect of any revolving
          credit or similar credit facility providing the Company or any of the Restricted
          Subsidiaries with the right to obtain loans or other extensions of credit from
          time to time, except to the extent that in connection with such payment of
          Indebtedness the availability of credit under such credit facility is
          permanently reduced not later than 270 days after the date of receipt of such
          proceeds by an amount not less than the amount of such proceeds applied to the
          payment of such Indebtedness). 

     (d)    
          For purposes of Section 10.2(c), a sale of assets will be deemed to involve a
          “substantial part” of the assets of the Company and the
          Restricted Subsidiaries if the book value of such assets, together with all
          other assets sold during such fiscal year (except those assets sold pursuant to
          clauses (i) through (iii) of Section 10.2(c)), exceeds 10% of the Consolidated
          Total Assets of the Company and the Restricted Subsidiaries determined as of the
          end of the immediately preceding fiscal year. 

     (e)    
          The Company will not, and will not permit any Restricted Subsidiary to, issue
          shares of stock (or any options or warrants to purchase stock or other
          Securities exchangeable for or convertible into stock) of any Restricted
          Subsidiary except (i) to the Company, (ii) to a Wholly-Owned Restricted
          Subsidiary, (iii) to any Restricted Subsidiary that owns equity in the
          Restricted Subsidiary issuing such equity, or (iv) with respect to a Restricted
          Subsidiary that is a partnership or joint venture, to any other Person who is a
          partner or equity owner if such issuance is made pursuant to the terms of the
          Joint Venture Agreement or Partnership Agreement entered into in connection with
          the formation of such partnership or joint venture; provided, that
          Restricted Subsidiaries may issue directors’ qualifying shares and shares
          required to be issued by any applicable foreign law regarding foreign ownership
          requirements. The Company will not, and will not permit any Restricted
          Subsidiary to sell, transfer or otherwise dispose of its interest in any stock
          (or any options or warrants to purchase stock or other Securities exchangeable
          for or convertible into stock) of any Restricted Subsidiary (except to the
          Company or a Wholly-Owned Restricted Subsidiary) unless such sale, transfer or
          disposition would be permitted under Section 10.2(c). 

10.3         Liens. 

The Company will not and will not
permit any of the Restricted Subsidiaries to directly or indirectly create, incur, assume
or permit to exist (upon the happening of a contingency or otherwise) any Lien on or with
respect to any property or asset (including, without limitation, any document or
instrument in respect of goods or accounts receivable) of the Company or any Restricted
Subsidiary, whether now owned or hereafter acquired, or any income or profits therefrom
(unless the Company makes, or causes to be made, effective provision whereby the Notes
will be equally and ratably secured with any and all other obligations thereby secured,
such security to be pursuant to an agreement reasonably satisfactory to the Required
Holders and, in any such case, the Notes shall have the benefit, to the fullest extent
that, and with such priority as, the holders of the Notes may be entitled under applicable
law, of any equitable Lien on such property), except for the following (which are
collectively referred to as “Permitted Liens”): 

     (a)    
          Liens for taxes, assessments or other governmental charges which are not yet
          delinquent or that are being contested in good faith; 

     (b)    
          Liens incidental to the conduct of business or the ownership of properties and
          assets (including landlords’, carriers’, warehousemen’s,
          mechanics’ materialmen’s, and other similar Liens) and Liens to secure
          the performance of bids, tenders, leases or trade contracts, or to secure
          statutory obligations (including obligations under workers compensation,
          unemployment insurance and other social security legislation), surety or appeal
          bonds or other Liens incurred in the ordinary course of business and not in
          connection with the borrowing of money; 

     (c)    
          Liens resulting from judgments, unless such judgments are not, within 60 days,
          discharged or stayed pending appeal, or shall not have been discharged within 60
          days after the expiration of any such stay; 

     (d)    
          Liens securing Indebtedness of a Restricted Subsidiary owed to the Company or to
          a Wholly-Owned Restricted Subsidiary; 

     (e)    
          Liens in existence at Closing and reflected in Schedule 10.3 hereto; 

     (f)    
          minor survey exceptions and the like which do not Materially detract from the
          value of such property; 

     (g)    
          leases, subleases, easements, rights of way, restrictions and other similar
          charges or encumbrances incidental to the ownership of property or assets or the
          ordinary conduct of the Company’s or any of the Restricted
          Subsidiaries’ businesses, provided that the aggregate of such Liens
          do not Materially detract from the value of such property; 

     (h)    
          Liens (i) existing on property at the time of its acquisition or construction by
          the Company or a Restricted Subsidiary and not created in contemplation thereof;
          (ii) on property created contemporaneously with its acquisition or within 180
          days of the acquisition or completion of construction or improvement thereof to
          secure the purchase price or cost of construction or improvement thereof,
          including such Liens arising under Capital Leases; or (iii) existing on property
          of a Person at the time such Person is acquired by, consolidated with, or merged
          into the Company or a Restricted Subsidiary and not created in contemplation
          thereof; provided that such Liens shall attach solely to the property
          acquired or constructed and the principal amount of the Indebtedness secured by
          the Lien shall not exceed the principal amount of such Indebtedness just prior
          to the time such Person is consolidated with or merged into the Company or a
          Restricted Subsidiary; 

     (i)    
          Liens on receivables of the Company or a Restricted Subsidiary and the related
          assets of the type specified in clauses (A) through (D) in the definition of
          “Permitted Securitization Program” in connection with any Permitted
          Securitization Program; 

     (j)    
          Liens in favor of the holders of the Notes and the other Senior Secured
          Creditors party to the Collateral Agency and Intercreditor Agreement in
          connection with the pledge of the Pledged Securities of each Material Foreign
          Subsidiary; 

     (k)    
          banker’s Liens and similar Liens (including set-off rights) in respect of
          bank deposits; provided, however, that any such Liens held by
          parties to the Collateral Agency and Intercreditor Agreement will be governed by
          and subject to the Collateral Agency and Intercreditor Agreement; 

     (l)    
          Liens in favor of customs and revenue authorities as a matter of law to secure
          payment of custom duties and in connection with the importation of goods in the
          ordinary course of the Company’s and its Subsidiaries’ business; 

     (m)    
          any Lien renewing, extending or replacing Liens permitted by Sections 10.3(e),
          (h), and (i), provided that (i) the principal amount of the
          Indebtedness secured is neither increased nor the maturity thereof changed to an
          earlier date, (ii) such Lien is not extended to any other property, and
          (iii) immediately after such extension, renewal or refunding, no Default
          or Event of Default would exist; and 

     (n)    
          other Liens securing Indebtedness not otherwise permitted by paragraphs (a)
          through (m) of this Section 10.3, provided that Priority Indebtedness
          shall not, at any time, exceed an amount equal to 13% of Consolidated Net Worth. 

Any Lien originally incurred in
compliance with paragraph (n) of this Section 10.3 may be renewed, extended or replaced so
long as the conditions set forth in subparagraphs (i), (ii) and (iii)
of paragraph (m) of this Section 10.3 are satisfied. 

10.4 Minimum
Consolidated Net Worth. 

The Company will not, at any time, permit
Consolidated Net Worth to be less than the sum of (i) $271,935,200, (ii) an
aggregate amount equal to 60% of Consolidated Net Income (but, in each case, only if a
positive number) earned in (a) the six months ended December 31, 2000, and (b) each
complete fiscal year thereafter, and (iii) 50% of the net proceeds realized by the
Company and its Restricted Subsidiaries from the sale of Equity Securities
subsequent to June 30, 2000, excluding issuances of Equity Securities upon exercise
of employee stock options or rights under any employee benefit plans (excluding such
exercise by any Person who owns greater than 5% of the Equity Securities of the Company),
issuances of Equity Securities in connection with acquisitions by the Company and its
Restricted Subsidiaries, and reissuances of up to $60,000,000 of treasury securities
purchased by the Company after the date of Closing. 

10.5         Limitation on
Indebtedness. 

     (a)    
          The Company will not permit at any time (i) the ratio of Total
          Indebtedness to EBITDA for the four most recently ended fiscal quarters of the
          Company to be greater than 1.85 to 1.0, or (ii) Priority Indebtedness to
          exceed 13% of Consolidated Net Worth. 

     (b)    
          The Company will not, and will not permit any Restricted Subsidiary to, incur,
          create or assume any Term Debt during the one year period immediately following
          the Closing unless (i) the aggregate principal amortization of all such Term
          Debt in any year does not exceed $30,000,000, and (ii) such Term Debt has at the
          time of issuance a longer average life to maturity than the remaining average
          life to maturity of the Notes then outstanding. 

     (c)    
          The Company will not, and will not permit any Restricted Subsidiary to, incur,
          assume or create any Indebtedness under any Significant Credit Facility unless
          each of the lenders under such Significant Credit Facility immediately becomes a
          party to the Collateral Agency and Intercreditor Agreement. 

10.6         Minimum Fixed
Charges Coverage. 

The Company will not permit, as of
the end of each fiscal quarter of the Company, the ratio of Consolidated Income Available
for Fixed Charges to Fixed Charges, for the period consisting of such fiscal quarter and
the preceding three fiscal quarters, to be less than 2.75 to 1.0. 

10.7         Nature of the
Business. 

The Company will not, and will not
permit any Restricted Subsidiary, to engage in any business if, as a result, the general
nature of the business of the Company and the Restricted Subsidiaries, taken as a whole,
which would then be engaged in by the Company and the Restricted Subsidiaries would be
substantially changed from the general nature of the business engaged in by the Company
and the Restricted Subsidiaries, taken as a whole, on the date of the Closing. 

10.8         Designation of
Restricted and Unrestricted Subsidiaries. 

The Company may designate in writing
to each of the holders of the Notes any Unrestricted Subsidiary as a Restricted Subsidiary
and may designate in writing to each of the holders of the Notes any Restricted Subsidiary
as an Unrestricted Subsidiary; provided that (i) no such designation of a
Restricted Subsidiary as an Unrestricted Subsidiary shall be effective unless (A) such
designation is treated as a transfer under Section 10.2 and such designation is permitted
by Section 10.2, and (B) such Subsidiary does not own any stock, other equity interest or
Indebtedness of the Company or a Restricted Subsidiary; and (ii) no such designation shall
be effective unless, immediately after giving effect thereto no Default or Event of
Default would exist; provided, further, that any Subsidiary that has been
designated as a Restricted Subsidiary or an Unrestricted Subsidiary may not thereafter be
redesignated as a Restricted Subsidiary or an Unrestricted Subsidiary, as the case may be,
more than once; and provided, further, that no Securitization Entity
shall be a Restricted Subsidiary unless designated as such by the Company. Notwithstanding
anything to the contrary in this Agreement, upon any Unrestricted Subsidiary becoming a
Material Subsidiary, it shall immediately be deemed to be a Restricted Subsidiary. 

10.9         Limitation on Swap
Agreements. 

The Company will not, and will not
permit any Restricted Subsidiary to, have any obligations (contingent or otherwise)
existing or arising under any Swap Agreement, unless such obligations are (or were)
entered into by such Person in the ordinary course of business for the purpose of
mitigating risks associated with liabilities, commitments or assets held by such Person,
and not for purposes of speculation. 

10.10         Limitation on
Restricted Payments. 

The Company will not, and will not
permit any Restricted Subsidiary to, do any of the following if a Default or Event of
Default exists or would exist immediately after giving effect thereto: 

     (a)    
          Declare or pay any dividends, either in cash or property, on any shares of
          capital stock of any class of the Company or any Restricted Subsidiary (except
          (i) dividends or other distributions payable solely in shares of common stock,
          and (ii) dividends and distributions paid by a Restricted Subsidiary solely to
          the Company or a Wholly-Owned Restricted Subsidiary); or 

     (b)    
          Directly or indirectly, or through any Restricted Subsidiary, purchase, redeem
          or retire any shares of capital stock of any class of the Company or any
          Restricted Subsidiary or any warrants, rights or options to purchase or acquire
          any shares of capital stock of the Company or any Restricted Subsidiary; or 

     (c)    
          Make any other payment or distribution, either directly or indirectly or through
          any Restricted Subsidiary, in respect of capital stock of any class of the
          Company or any Restricted Subsidiary (except payments and distributions made by
          a Restricted Subsidiary solely to the Company or a Wholly-Owned Restricted
          Subsidiary). 

10.11         Most Favored
Lender. 

If the Company creates, incurs or
assumes any Term Debt within the one year period immediately following the Closing,
and any such Term Debt has financial or operational covenants other than as set forth in
this Section 10, or more favorable to the lender or creditor thereunder than those set
forth in this Section 10, then this Section 10 shall be deemed to be automatically amended
to include such other or more favorable covenants, such amendment to be effective as of
the date of such incurrence, creation or assumption, and such other or more favorable
covenants as incorporated into this Section 10 may not thereafter be modified without the
written consent of the Required Holders. 

11.         EVENTS OF DEFAULT. 

An “Event of
Default” shall exist if any of the following conditions or events shall occur and
be continuing: 

     (a)    
          the Company defaults in the payment of any principal or Make-Whole Amount, if
          any, on any Note when the same becomes due and payable, whether at maturity or
          at a date fixed for prepayment or by declaration or otherwise; or 

     (b)    
          the Company defaults in the payment of any interest on any Note or any amount
          payable under Section 14.4 for more than five Business Days after the same
          becomes due and payable; or 

     (c)    
          the Company defaults in the performance of or compliance with any term contained
          in Section 10; or 

     (d)    
          the Company or any of its Subsidiaries defaults in the performance of or
          compliance with any term contained herein (other than those referred to in
          paragraphs (a), (b) and (c) of this Section 11) or in any Collateral
          Document and such default is not remedied within 30 days after the earlier of
          (i) a Responsible Officer obtaining actual knowledge of such
          default, and (ii) the Company or such Subsidiary receiving written
          notice of such default from any holder of a Note (any such written notice to be
          identified as a “notice of default” and to refer specifically to this
          paragraph (d) of Section 11); or 

     (e)    
          any representation or warranty made in writing by or on behalf of the Company or
          any Subsidiary Guarantor or by any officer of the Company or any Subsidiary
          Guarantor in this Agreement, the Collateral Documents or in any writing
          furnished in connection with the transactions contemplated hereby or thereby
          proves to have been false or incorrect in any material respect on the date as of
          which made; or 

     (f)    
          (i) the Company or any Restricted Subsidiary is in default (as principal
          or as guarantor or other surety) in the payment of any principal of or premium
          or make-whole amount or interest on any Indebtedness beyond any period of grace
          provided with respect thereto, or (ii) the Company or any Restricted
          Subsidiary is in default for more than 20 Business Days in the performance of or
          compliance with any term of any evidence of any Indebtedness or of any mortgage,
          indenture or other agreement relating thereto or any other condition exists, and
          as a consequence of such default or condition (x) such Indebtedness has become,
          or has been declared (or one or more Persons are entitled to declare such
          Indebtedness to be) due and payable before its stated maturity or before its
          regularly scheduled dates of payment, or (y) one or more Persons have the right
          to require the Company or any Restricted Subsidiary to purchase or repay such
          Indebtedness, or (iii) as a consequence of the occurrence or continuation
          of any event or condition (other than the passage of time or the right of the
          holder of Indebtedness to convert such Indebtedness into equity interests), (x)
          the Company or any Restricted Subsidiary has become obligated to purchase or
          repay any Indebtedness before its regular maturity or before its regularly
          scheduled dates of payment, or (y) one or more Persons have exercised any right
          to require the Company or any Restricted Subsidiary to purchase or repay such
          Indebtedness, provided that the aggregate amount of all foregoing
          Indebtedness with respect to which a payment, performance or compliance default
          shall have occurred or a failure or other event causing or permitting the
          purchase or repayment by the Company or any Restricted Subsidiary shall have
          occurred exceeds $7,500,000; or 

     (g)    
          the Company or any Material Subsidiary (i) is generally not paying,
          or admits in writing its inability to pay, its debts as they become due,
          (ii) files, or consents by answer or otherwise to the filing against
          it of, a petition for relief or reorganization or arrangement or any other
          petition in bankruptcy, for liquidation or to take advantage of any bankruptcy,
          insolvency, reorganization, moratorium or other similar law of any jurisdiction,
          (iii) makes an assignment for the benefit of its creditors,
          (iv) consents to the appointment of a custodian, receiver, trustee
          or other officer with similar powers with respect to it or with respect to any
          substantial part of its property, (v) is adjudicated as insolvent or
          to be liquidated, or (vi) takes corporate action for the purpose of
          any of the foregoing; or 

     (h)    
          a court or governmental authority of competent jurisdiction enters an order
          appointing, without consent by the Company or any Material Subsidiary, a
          custodian, receiver, trustee or other officer with similar powers with respect
          to it or with respect to any substantial part of its property, or constituting
          an order for relief or approving a petition for relief or reorganization or any
          other petition in bankruptcy or for liquidation or to take advantage of any
          bankruptcy or insolvency law of any jurisdiction, or ordering the dissolution,
          winding-up or liquidation of the Company or any Material Subsidiary, or any such
          petition shall be filed against the Company or any Material Subsidiary and such
          petition shall not be dismissed within 60 days; or 

     (i)    
          a final judgment or judgments for the payment of money aggregating in excess of
          $10,000,000 are rendered against one or more of the Company and any Restricted
          Subsidiary and which judgments are not, within 60 days after entry thereof,
          bonded, discharged or stayed pending appeal, or are not discharged within 60
          days after the expiration of such stay; or 

     (j)    
          the Subsidiary Guaranty ceases to be in full force and effect with respect to
          any Material Domestic Subsidiary, or any Material Domestic Subsidiary contests
          the validity thereof; or 

     (k)    
          the Pledge Agreement ceases to be in full force and effect with respect to any
          Material Foreign Subsidiary, any Pledgor contests the validity of the Pledge
          Agreement, or the Collateral Agent shall fail to have a valid, perfected and
          enforceable first priority security interest in the Pledged Securities; or 

     (l)    
          [Reserved.] 

     (m)    
          (i) any Plan shall fail to satisfy the minimum funding standards of ERISA
          or the Code for any plan year or part thereof or a waiver of such standards or
          extension of any amortization period is sought or granted under section 412
          of the Code, (ii) a notice of intent to terminate any Plan shall have been
          or is reasonably expected to be filed with the PBGC or the PBGC shall have
          instituted proceedings under ERISA section 4042 to terminate or appoint a
          trustee to administer any Plan or the PBGC shall have notified the Company or
          any ERISA Affiliate that a Plan may become a subject of any such proceedings,
          (iii) the aggregate “amount of unfunded benefit liabilities”
          (within the meaning of section 4001(a)(18) of ERISA) under all Plans, determined
          in accordance with Title IV of ERISA, shall exceed 5% of Consolidated Net Worth
          as of the end of the most recently ended fiscal quarter of the Company,
          (iv) the Company or any ERISA Affiliate shall have incurred or is
          reasonably expected to incur any liability pursuant to Title I or IV of ERISA or
          the penalty or excise tax provisions of the Code relating to employee benefit
          plans, (v) the Company or any ERISA Affiliate withdraws from any Multiemployer
          Plan, or (vi) the Company or any of its Subsidiaries establishes or amends any
          employee welfare benefit plan that provides post-employment welfare benefits in
          a manner that would increase the liability of the Company or any of its
          Subsidiaries thereunder; and any such event or events described in clauses (i)
          through (vi) above, either individually or together with any other such event or
          events, could reasonably be expected to have a Material Adverse Effect. 

As used in Section 11(m), the terms
“employee benefit plan” and “employee welfare benefit
plan” shall have the respective meanings assigned to such terms in Section 3 of
ERISA. 

12.         REMEDIES ON DEFAULT,
ETC. 

12.1         Acceleration. 

     (a)    
          If an Event of Default with respect to the Company described in
          paragraph (g) or (h) of Section 11 (other than an Event of Default
          described in clause (i) of paragraph (g) or described in clause
          (vi) of paragraph (g) by virtue of the fact that such clause
          encompasses clause (i) of paragraph (g)) has occurred, all the Notes
          then outstanding shall automatically become immediately due and payable. 

     (b)    
          If any other Event of Default has occurred and is continuing, any holder or
          holders of more than 50% in principal amount of the Notes at the time
          outstanding may at any time at its or their option, by notice or notices to the
          Company, declare all the Notes then outstanding to be immediately due and
          payable. 

     (c)    
          If any Event of Default described in paragraph (a) or (b) of Section 11 has
          occurred and is continuing, any holder or holders of Notes at the time
          outstanding affected by such Event of Default may at any time, at its or their
          option, by notice or notices to the Company, declare all the Notes held by it or
          them to be immediately due and payable. 

Upon any Notes becoming due and
payable under this Section 12.1, whether automatically or by declaration, such Notes
will forthwith mature and the entire unpaid principal amount of such Notes, plus
(x) all accrued and unpaid interest thereon and (y) the Make-Whole Amount
determined in respect of such principal amount (to the full extent permitted by applicable
law), shall all be immediately due and payable, in each and every case without
presentment, demand, protest or further notice, all of which are hereby waived. The
Company acknowledges, and the parties hereto agree, that each holder of a Note has the
right to maintain its investment in the Notes free from repayment by the Company (except
as herein specifically provided for) and that the provision for payment of a Make-Whole
Amount by the Company in the event that the Notes are prepaid or are accelerated as a
result of an Event of Default, is intended to provide compensation for the deprivation of
such right under such circumstances. 

12.2         Other Remedies. 

If any Default or Event of Default
has occurred and is continuing, and irrespective of whether any Notes have become or have
been declared immediately due and payable under Section 12.1, the holder of any Note at
the time outstanding may proceed to protect and enforce the rights of such holder by an
action at law, suit in equity or other appropriate proceeding, whether for the specific
performance of any agreement contained herein, in the Collateral Documents or in any Note,
or for an injunction against a violation of any of the terms hereof or thereof, or in aid
of the exercise of any power granted hereby or thereby or by law or otherwise. 

12.3         Rescission. 

At any time after any Notes have been
declared due and payable pursuant to clause (b) or (c) of Section 12.1, the Required
Holders, by written notice to the Company, may rescind and annul any such declaration and
its consequences, and at any time after any Notes have become due and payable pursuant to
clause (a) of Section 12.1, the holders of all Notes then outstanding, by written notice
to the Company, may rescind acceleration of the Notes resulting from the occurrence of an
Event of Default described in paragraph (h) of Section 11, if in each case (i) the
Company has paid all overdue interest on the Notes, all principal of and Make-Whole
Amount, if any, on any Notes that are due and payable and are unpaid other than by reason
of such declaration, and all interest on such overdue principal and Make-Whole Amount, if
any, and (to the extent permitted by applicable law) any overdue interest in respect of
the Notes, at the Default Rate, (ii) all Events of Default and Defaults, other than
non-payment of amounts that have become due solely by reason of such declaration or
acceleration, have been cured or have been waived pursuant to Section 17, and
(iii) no judgment or decree has been entered for the payment of any monies due
pursuant hereto or to the Notes. No rescission and annulment under this Section 12.3 will
extend to or affect any subsequent Event of Default or Default or impair any right
consequent thereon. 

12.4         No Waivers or
Election of Remedies, Expenses, etc. 

No course of dealing and no delay on
the part of any holder of any Note in exercising any right, power or remedy shall operate
as a waiver thereof or otherwise prejudice such holder’s rights, powers or remedies.
No right, power or remedy conferred by this Agreement, the Collateral Documents or by any
Note upon any holder thereof shall be exclusive of any other right, power or remedy
referred to herein or therein or now or hereafter available at law, in equity, by statute
or otherwise. Without limiting the obligations of the Company under Section 15, the
Company will pay to the holder of each Note on demand such further amount as shall be
sufficient to cover all costs and expenses of such holder incurred in any enforcement or
collection under this Section 12, including, without limitation, reasonable
attorneys’ fees, expenses and disbursements. 

13.         REGISTRATION;
EXCHANGE; SUBSTITUTION OF NOTES. 

13.1         Registration of
Notes. 

The Company shall keep at its
principal executive office a register for the registration and registration of transfers
of Notes. The name and address of each holder of one or more Notes, each transfer thereof
and the name and address of each transferee of one or more Notes shall be registered in
such register. Prior to due presentment for registration of transfer, the Person in whose
name any Note shall be registered shall be deemed and treated as the owner and holder
thereof for all purposes hereof, and the Company shall not be affected by any notice or
knowledge to the contrary. The Company shall give to any holder of a Note that is an
Institutional Investor promptly upon request therefor, a complete and correct copy of the
names and addresses of all registered holders of Notes. 

13.2         Transfer and
Exchange of Notes. 

Upon surrender of any Note at the
principal executive office of the Company for registration of transfer or exchange (and in
the case of a surrender for registration of transfer, duly endorsed or accompanied by a
written instrument of transfer duly executed by the registered holder of such Note or his
attorney duly authorized in writing and accompanied by the address for notices of each
transferee of such Note or part thereof), the Company shall execute and deliver, at the
Company’s expense (except as provided below), one or more new Notes (as requested by
the holder thereof) in exchange therefor, in an aggregate principal amount equal to the
unpaid principal amount of the surrendered Note. Each such new Note shall be payable to
such Person as such holder may request and shall be substantially in the form of
Exhibit 1. Each such new Note shall be dated and bear interest from the date
to which interest shall have been paid on the surrendered Note or dated the date of the
surrendered Note if no interest shall have been paid thereon. The Company may require
payment of a sum sufficient to cover any stamp tax or governmental charge imposed in
respect of any such transfer of Notes. Notes shall not be transferred in denominations of
less than the Yen-equivalent of $100,000, provided that if necessary to enable the
registration of transfer by a holder of its entire holding of Notes, one Note may be in a
denomination of less than the Yen-equivalent of $100,000. Any transferee, by its
acceptance of a Note registered in its name (or the name of its nominee), shall be deemed
to have made the representations set forth in Section 6 and to have become a party to the
Collateral Agency and Intercreditor Agreement. Each transferee of a Note which was not
previously a holder of the Notes under this Agreement and which is not incorporated under
the laws of the United States of America or a state thereof shall, within three Business
Days of becoming a holder, deliver to the Company such certificate and other evidence as
the Company may reasonably request to establish that such holder is entitled to receive
payments under the Notes without deduction or withholding of any United States federal
income taxes. 

13.3         Replacement of
Notes. 

Upon receipt by the Company of
evidence reasonably satisfactory to it of the ownership of and the loss, theft,
destruction or mutilation of any Note (which evidence shall be, in the case of an
Institutional Investor, notice from such Institutional Investor of such ownership and such
loss, theft, destruction or mutilation), and 

     (a)    
          in the case of loss, theft or destruction, of indemnity reasonably satisfactory
          to it (provided that if the holder of such Note is, or is a nominee for,
          an original Purchaser or another holder of a Note with a minimum net worth of at
          least $100,000,000, such Person’s own unsecured agreement of indemnity
          shall be deemed to be satisfactory), or 

     (b)    
          in the case of mutilation, upon surrender and cancellation thereof, 

the Company at its own expense shall
execute and deliver, in lieu thereof, a new Note, dated and bearing interest from the date
to which interest shall have been paid on such lost, stolen, destroyed or mutilated Note
or dated the date of such lost, stolen, destroyed or mutilated Note if no interest shall
have been paid thereon. 

14.         PAYMENTS ON NOTES. 

14.1         Place of Payment. 

Subject to Section 14.2, payments of
principal, Make-Whole Amount, if any, and interest becoming due and payable on the Notes
shall be made in Provo, Utah at the principal office of the Company in such jurisdiction.
The Company may at any time, by notice to each holder of a Note, change the place of
payment of the Notes so long as such place of payment shall be either the principal office
of the Company in such jurisdiction or the principal office of a bank or trust company in
such jurisdiction. 

14.2         Home Office Payment. 

So long as you or your nominee shall
be the holder of any Note, and notwithstanding anything contained in Section 14.1 or in
such Note to the contrary, the Company will pay all sums becoming due on such Note for
principal, Make-Whole Amount, if any, and interest by the method and at the address
specified for such purpose below your name in Schedule A, or by such other method
or at such other address as you shall have from time to time specified to the Company in
writing for such purpose, without the presentation or surrender of such Note or the making
of any notation thereon, except that upon written request of the Company made concurrently
with or reasonably promptly after payment or prepayment in full of any Note, you shall
surrender such Note for cancellation, reasonably promptly after any such request, to the
Company at its principal executive office or at the place of payment most recently
designated by the Company pursuant to Section 14.1. Prior to any sale or other disposition
of any Note held by you or your nominee you will, at your election, either endorse thereon
the amount of principal paid thereon and the last date to which interest has been paid
thereon or surrender such Note to the Company in exchange for a new Note or Notes pursuant
to Section 13.2. The Company will afford the benefits of this Section 14.2 to any
Institutional Investor that is the direct or indirect transferee of any Note purchased by
you under this Agreement and that has made the same agreement relating to such Note as you
have made in this Section 14.2. 

14.3         Obligation to Make
Payments in Yen. 

The obligation of the Company to make
payments in Yen of the principal, applicable Make-Whole Amount, if any, and interest
becoming due and payable on the Notes and any other amounts due hereunder or under the
Notes as provided in Section 14.2, (a) shall not be discharged or satisfied by
any tender, or any recovery pursuant to any judgment, which is expressed in or converted
into any currency other than Yen, except to the extent that such tender or recovery shall
result in the actual receipt by the holders of the Notes of the full amount of Yen
expressed to be payable in respect of the principal, applicable Make-Whole Amount, if any,
in respect of and interest on the Notes and all other amounts due hereunder or under the
Notes, (b) shall be enforceable as an alternative or additional cause of action for
the purpose of recovering in Yen the amount, if any, by which such actual receipt shall
fall short of the full amount of Yen so expressed to be payable, and (c) shall
not be affected by judgment being obtained for any other sum due under this Agreement or
on any Note. 

14.4         Payments Free and
Clear of Taxes. 

     (a)    
          Payments. The Company will pay all amounts of principal of, applicable
          Make-Whole Amount, if any, and interest on the Notes, and all other amounts
          payable hereunder or under the Notes, without set-off or counterclaim and free
          and clear of, and without deduction or withholding for or on account of, all
          present and future income, stamp, documentary and other taxes and duties, and
          all other levies, imposts, charges, fees, deductions and withholdings, now or
          hereafter imposed, levied, collected, withheld or assessed by any Governmental
          Authority (except net income taxes and franchise taxes in lieu of net income
          taxes imposed on any holder of any Note by its jurisdiction of incorporation or
          the jurisdiction in which its applicable lending office is located) (all such
          non-excluded taxes, duties, levies, imposts, duties, charges, fees, deductions
          and withholdings being hereinafter called “Taxes”). If any
          Taxes are required to be withheld from any amounts payable to a holder of any
          Notes, the amounts so payable to such holder shall be increased to the extent
          necessary to yield such holder (after payment of all Taxes) interest on any such
          other amounts payable hereunder at the rates or in the amounts specified in this
          Agreement and the Notes. Whenever any Taxes are payable by the Company, as
          promptly as possible thereafter, the Company shall send to each holder of the
          Notes, a certified copy of an original official receipt received by the Company
          showing payment thereof. If the Company fails to pay any Taxes when due to the
          appropriate taxing authority or fails to remit to each holder of the Notes the
          required receipts or other required documentary evidence, the Company shall
          indemnify each holder of the Notes for any taxes (including interest or
          penalties) that may become payable by such holder as a result of any such
          failure. The obligations of the Company under this subsection 14.4(a) shall
          survive the payment and performance of the Notes and the termination of this
          Agreement. 

     (b)    
          Withholding Exemption Certificates. On or prior to the Closing Date, each
          holder of the Notes which is not organized under the laws of the United States
          of America or a state thereof shall deliver to the Company such certificates and
          other evidence as the Company may reasonably request to establish that such
          holder is entitled to receive payments under the Notes without deduction or
          withholding of any United States federal income taxes. Each such holder further
          agrees (i) promptly to notify the Company of any change of circumstances
          (including any change in any treaty, law or regulation) which would prevent such
          holder from receiving payments under the Notes without any deduction or
          withholding of such taxes, and (ii) on or before the date that any certificate
          or other form delivered by such holder under this subsection 14.4(b) expires or
          becomes obsolete or after the occurrence of any event requiring a change in the
          most recent such certificate or form previously delivered by such holder, to
          deliver to the Company a new certificate or form, certifying that such holder is
          entitled to receive payments under the Notes without deduction or withholding of
          such taxes. If any holder of the Notes which is not organized under the laws of
          the United States of America or a state thereof fails to provide to the Company
          pursuant to this subsection 14.4(b) (or in the case of a transferee of a Note,
          Section 13.2) any certificates or other evidence required by such provision to
          establish that such holder is, at the time it becomes a holder, entitled to
          receive payments under the Notes without deduction or withholding of any United
          States federal income taxes, such holder shall not be entitled to any
          indemnification under subsection 14.4(a) for any Taxes imposed on such holder. 

     15.        
          EXPENSES, ETC.

15.1         Transaction
Expenses. 

Whether or not the transactions
contemplated hereby are consummated, the Company will pay all costs and expenses
(including reasonable attorneys’ fees of one special counsel and, if reasonably
required, local or other counsel) incurred by the Collateral Agent and you in connection
with such transactions and in connection with any amendments, waivers or consents under or
in respect of this Agreement, the Collateral Documents or the Notes (whether or not such
amendment, waiver or consent becomes effective), including, without limitation: (a)
the costs and expenses incurred in enforcing or defending (or determining whether or how
to enforce or defend) any rights under this Agreement, the Collateral Documents or the
Notes or in responding to any subpoena or other legal process or informal investigative
demand issued in connection with this Agreement, the Collateral Documents or the Notes, or
by reason of being a holder of any Note, and (b) the costs and expenses, including
financial advisors’ fees, incurred in connection with the insolvency or bankruptcy of
the Company or any Subsidiary or in connection with any work-out or restructuring of the
transactions contemplated hereby, by the Collateral Documents and by the Notes. The
Company will pay, and will save you and each other holder of a Note harmless from, all
claims in respect of any fees, costs or expenses if any, of brokers and finders (other
than those retained by you). 

15.2         Survival. 

The obligations of the Company under
this Section 15 will survive the payment or transfer of any Note, the enforcement,
amendment or waiver of any provision of this Agreement, the Collateral Documents or the
Notes, and the termination of this Agreement and the Collateral Documents. 

16.         SURVIVAL OF
REPRESENTATIONS AND WARRANTIES; ENTIRE AGREEMENT. 

All representations and warranties
contained herein and in the Collateral Documents shall survive the execution and delivery
of this Agreement, the Collateral Documents and the Notes, the purchase or transfer by you
of any Note or portion thereof or interest therein and the payment of any Note, and may be
relied upon by any subsequent holder of a Note, regardless of any investigation made at
any time by or on behalf of you or any other holder of a Note. All statements contained in
any certificate or other instrument delivered by or on behalf of the Company pursuant to
this Agreement or the Collateral Documents shall be deemed representations and warranties
of the Company under this Agreement. Subject to the preceding sentence, this Agreement,
the Collateral Documents and the Notes embody the entire agreement and understanding
between you and the Company and supersede all prior agreements and understandings relating
to the subject matter hereof. 

17.         AMENDMENT AND WAIVER. 

17.1         Requirements. 

This Agreement, the Collateral
Documents and the Notes may be amended, and the observance of any term hereof or thereof
may be waived (either retroactively or prospectively), with (and only with) the written
consent of the Company and the Required Holders, except that (a) no amendment or
waiver of any of the provisions of Section 1, 2, 3, 4, 5, 6 or 21 hereof, or any
defined term (as it is used therein), will be effective as to you unless consented to by
you in writing, and (b) no such amendment or waiver may, without the written
consent of the holder of each Note at the time outstanding affected thereby,
(i) subject to the provisions of Section 12 relating to acceleration or
rescission, change the amount or time of any prepayment or payment of principal of, or
reduce the rate or change the time of payment or method of computation of interest or of
the Make-Whole Amount on, the Notes, (ii) change the percentage of the
principal amount of the Notes the holders of which are required to consent to any such
amendment or waiver, or (iii) amend any of Sections 8, 11(a), 11(b), 12, 17 or
20. 

17.2         Solicitation of
Holders of Notes. 

     (a)    
          Solicitation. The Company will provide each holder of the Notes
          (irrespective of the amount of Notes then owned by it) with sufficient
          information, sufficiently far in advance of the date a decision is required, to
          enable such holder to make an informed and considered decision with respect to
          any proposed amendment, waiver or consent in respect of any of the provisions
          hereof or of the Notes. The Company will deliver executed or true and correct
          copies of each amendment, waiver or consent effected pursuant to the provisions
          of this Section 17 to each holder of outstanding Notes promptly following
          the date on which it is executed and delivered by, or receives the consent or
          approval of, the requisite holders of Notes. 

     (b)    
          Payment. The Company will not directly or indirectly pay or cause to be
          paid any remuneration, whether by way of supplemental or additional interest,
          fee or otherwise, or grant any security, to any holder of Notes as consideration
          for or as an inducement to the entering into by any holder of Notes of any
          waiver or amendment of any of the terms and provisions hereof unless such
          remuneration is concurrently offered, or such security is concurrently offered
          to be granted, on the same terms, ratably to each holder of Notes then
          outstanding even if such holder did not consent to such waiver or amendment. 

17.3         Binding Effect, etc. 

Any amendment or waiver consented to
as provided in this Section 17 applies equally to all holders of Notes and is binding
upon them and upon each future holder of any Note and upon the Company without regard to
whether such Note has been marked to indicate such amendment or waiver. No such amendment
or waiver will extend to or affect any obligation, covenant, agreement, Default or Event
of Default not expressly amended or waived or impair any right consequent thereon. No
course of dealing between the Company and the holder of any Note nor any delay in
exercising any rights hereunder or under any Note shall operate as a waiver of any rights
of any holder of such Note. As used herein, the term “this Agreement” and
“the Collateral Documents” and references thereto shall mean this Agreement and
the Collateral Documents, respectively, as they may from time to time be amended or
supplemented. 

17.4         Notes held by
Company, etc. 

Solely for the purpose of determining
whether the holders of the requisite percentage of the aggregate principal amount of Notes
then outstanding approved or consented to any amendment, waiver or consent to be given
under this Agreement or the Notes, or have directed the taking of any action provided
herein or in the Notes to be taken upon the direction of the holders of a specified
percentage of the aggregate principal amount of Notes then outstanding, Notes directly or
indirectly owned by the Company or any of its Affiliates shall be deemed not to be
outstanding. 

18.         NOTICES. 

All notices and communications
provided for hereunder shall be in writing and sent (a) by telecopy if the
sender on the same day sends a confirming copy of such notice by a recognized overnight
delivery service (charges prepaid), or (b) by registered or certified mail
with return receipt requested (postage prepaid), or (c) by a recognized
overnight delivery service (with charges prepaid). Any such notice must be sent: 

     (a)    
          if to you or your nominee, to you or it at the address specified for such
          communications in Schedule A, or at such other address as you or it shall
          have specified to the Company in writing, 

     (b)    
          if to any other holder of any Note, to such holder at such address as such other
          holder shall have specified to the Company in writing, or 

     (c)    
          if to the Company, to the Company at One Nu Skin Plaza, 75 West Center Street,
          Provo, Utah 84601 to the attention of the Chief Financial Officer, or at such
          other address as the Company shall have specified to the holder of each Note in
          writing. 

Notices under this Section 18 will be
deemed given only when actually received. 

19.         REPRODUCTION OF
DOCUMENTS. 

This Agreement, the Collateral
Documents and all documents relating thereto, including, without limitation,
(a) consents, waivers and modifications that may hereafter be executed,
(b) documents received by you at the Closing (except the Notes themselves),
and (c) financial statements, certificates and other information previously or
hereafter furnished to you, may be reproduced by you by any photographic, photostatic,
microfilm, microcard, miniature photographic or other similar process and you may destroy
any original document so reproduced. The Company agrees and stipulates that, to the extent
permitted by applicable law, any such reproduction shall be admissible in evidence as the
original itself in any judicial or administrative proceeding (whether or not the original
is in existence and whether or not such reproduction was made by you in the regular course
of business) and any enlargement, facsimile or further reproduction of such reproduction
shall likewise be admissible in evidence. This Section 19 shall not prohibit the Company
or any other holder of Notes from contesting any such reproduction to the same extent that
it could contest the original, or from introducing evidence to demonstrate the inaccuracy
of any such reproduction. 

20.         CONFIDENTIAL
INFORMATION. 

For the purposes of this Section 20,
“Confidential Information” means information delivered to you by or on behalf of
the Company or any Subsidiary in connection with the transactions contemplated by or
otherwise pursuant to this Agreement that is proprietary in nature and that was clearly
marked or labeled or otherwise adequately identified when received by you as being
confidential information of the Company or such Subsidiary, provided that such term
does not include information that (a) was publicly known or otherwise known to
you prior to the time of such disclosure, (b) subsequently becomes publicly
known through no act or omission by you or any person acting on your behalf,
(c) otherwise becomes known to you other than through disclosure (x) by
the Company or any Subsidiary, or (y) by another Person known by you to be bound by a
confidentiality agreement with the Company, or (d) constitutes financial statements
delivered to you under Section 7.1 that are otherwise publicly available. You will
maintain the confidentiality of such Confidential Information in accordance with
procedures adopted by you in good faith to protect confidential information of third
parties delivered to you, provided that you may deliver or disclose Confidential
Information to (i) your directors, officers, employees, agents, attorneys and
affiliates (to the extent such disclosure reasonably relates to the administration of the
investment represented by your Notes), (ii) your financial advisors and other
professional advisors who agree to hold confidential the Confidential Information
substantially in accordance with the terms of this Section 20, (iii) any other
holder of any Note, (iv) any Institutional Investor to which you sell or offer
to sell such Note or any part thereof or any participation therein (if such Person has
agreed in writing prior to its receipt of such Confidential Information to be bound by the
provisions of this Section 20), (v) any Person from which you offer to
purchase any security of the Company (if such Person has agreed in writing prior to its
receipt of such Confidential Information to be bound by the provisions of this
Section 20), (vi) any federal or state regulatory authority having
jurisdiction over you, (vii) the National Association of Insurance
Commissioners or any similar organization, or any nationally recognized rating agency that
requires access to information about your investment portfolio or (viii) any
other Person to which such delivery or disclosure may be necessary or appropriate
(w) to effect compliance with any law, rule, regulation or order applicable to
you, (x) in response to any subpoena or other legal process (provided that you
give prompt notice to the Company of such subpoena or legal process to the extent you are
legally permitted to do so), (y) in connection with any litigation to which
you are a party, or (z) if an Event of Default has occurred and is continuing,
to the extent you may reasonably determine such delivery and disclosure to be necessary or
appropriate in the enforcement or for the protection of the rights and remedies under your
Notes, this Agreement and the Collateral Documents. Each holder of a Note, by its
acceptance of a Note, will be deemed to have agreed to be bound by and to be entitled to
the benefits of this Section 20 as though it were a party to this Agreement. On reasonable
request by the Company in connection with the delivery to any holder of a Note of
information required to be delivered to such holder under this Agreement or requested by
such holder (other than a holder that is a party to this Agreement or its nominee), such
holder will enter into an agreement with the Company embodying the provisions of this
Section 20. 

21.         SUBSTITUTION OF
PURCHASER. 

You shall have the right to
substitute any one of your Affiliates as the purchaser of the Notes that you have agreed
to purchase hereunder, by written notice to the Company, which notice shall be signed by
both you and such Affiliate, shall contain such Affiliate’s agreement to be bound by
this Agreement and shall contain a confirmation by such Affiliate of the accuracy with
respect to it of the representations set forth in Section 6. Upon receipt of such notice,
wherever the word “you” is used in this Agreement (other than in this Section
21), such word shall be deemed to refer to such Affiliate in lieu of you. In the event
that such Affiliate is so substituted as a purchaser hereunder and such Affiliate
thereafter transfers to you all of the Notes then held by such Affiliate, upon receipt by
the Company of notice of such transfer, wherever the word “you” is used in this
Agreement (other than in this Section 21), such word shall no longer be deemed to
refer to such Affiliate, but shall refer to you, and you shall have all the rights of an
original holder of the Notes under this Agreement. 

22.         JUDICIAL PROCEEDINGS. 

22.1         Consent to
Jurisdiction. 

The Company irrevocably submits to
the non-exclusive jurisdiction of any New York State or United States federal court
sitting in New York City, and irrevocably waives its own forum, over any suit, action or
proceeding arising out of or relating to this Agreement or any Note. The Company
irrevocably waives, to the fullest extent it may effectively do so under applicable law,
any objection which it may have or hereafter have to the laying of the venue of any such
suit, action or proceeding brought in any such court and any claim that any such suit,
action or proceeding brought in any such court has been brought in an inconvenient forum.
The Company agrees, to the fullest extent it may effectively do so under applicable law,
that a final judgment in any such suit, action or proceeding brought in such court shall
be conclusive and binding upon the Company and may be enforced in the courts of the United
States, the State of New York (or any other courts to the jurisdiction of which the
Company is or may be subject) by a suit upon such judgment, provided that service
of process is effected on the Company in one of the manners specified below or as
otherwise permitted by law. 

22.2         Service of Process. 

The Company hereby consents to
process being served in any suit, action or proceeding of the nature referred to in
Section 22.1 by the mailing of a copy thereof by registered or certified air mail, postage
prepaid, return receipt requested, to the address of the Company set forth in Section 18.
The Company irrevocably waives, to the fullest extent it may effectively do so under
applicable law, all claim of error by reason of any such service and agrees that such
service (a) shall be deemed in every respect effective service of process upon
the Company in any such suit, action or proceeding, and (b) shall, to the
fullest extent permitted by law, be taken and held to be valid personal service upon the
Company. 

22.3         No Limitation on
Service or Suit. 

Nothing in this Section 22 shall
affect the right of any holder of the Notes to serve process in any manner permitted by
law or limit the right of any holder of the Notes to bring proceedings against the Company
in the courts of any jurisdiction or jurisdictions or to enforce in any lawful manner a
judgment obtained in one jurisdiction in any other jurisdiction. 

23.         MISCELLANEOUS. 

23.1         Successors and
Assigns. 

All covenants and other agreements
contained in this Agreement and the Collateral Documents by or on behalf of any of the
parties hereto or thereto bind and inure to the benefit of their respective successors and
assigns (including, without limitation, any subsequent holder of a Note) whether so
expressed or not. 

23.2         Payments Due on
Non-Business Days. 

Anything in this Agreement, the
Collateral Documents or the Notes to the contrary notwithstanding, any payment of
principal of or Make-Whole Amount or interest on any Note that is due on a date other than
a Business Day shall be made on the next succeeding Business Day without including the
additional days elapsed in the computation of the interest payable on such next succeeding
Business Day. 

23.3         Severability. 

Any provision of this Agreement or
the Collateral Documents that is prohibited or unenforceable in any jurisdiction shall, as
to such jurisdiction, be ineffective to the extent of such prohibition or unenforceability
without invalidating the remaining provisions hereof or thereof, and any such prohibition
or unenforceability in any jurisdiction shall (to the full extent permitted by law) not
invalidate or render unenforceable such provision in any other jurisdiction. 

23.4         Construction. 

Each covenant contained herein shall
be construed (absent express provision to the contrary) as being independent of each other
covenant contained herein, so that compliance with any one covenant shall not (absent such
an express contrary provision) be deemed to excuse compliance with any other covenant.
Where any provision herein refers to action to be taken by any Person, or which such
Person is prohibited from taking, such provision shall be applicable whether such action
is taken directly or indirectly by such Person. 

23.5         Counterparts. 

This Agreement and the Collateral
Documents may be executed in any number of counterparts, each of which shall be an
original but all of which together shall constitute one instrument. Each counterpart may
consist of a number of copies hereof, each signed by less than all, but together signed by
all, of the parties hereto. 

23.6         Governing Law. 

This Agreement shall be construed and
enforced in accordance with, and the rights of the parties shall be governed by, the law
of the State of New York excluding choice-of-law principles of the law of such State
(other than Section 5-1401 of the New York General Obligations Law) that would require the
application of the laws of a jurisdiction other than such State. 

     _________________ 

        If
you are in agreement with the foregoing, please sign the form of agreement on the
accompanying counterpart of this Agreement and return it to the Company, whereupon the
foregoing shall become a binding agreement between you and the Company. 

Very truly yours, 

NU SKIN ENTERPRISES, INC. 

By:    /s/ Corey B. Lindley 

Name:       Corey B. Lindley

Title:    Executive Vice President and 

               Chief
Financial Officer

The foregoing is hereby agreed to as
of the date thereof. 

THE
PRUDENTIAL INSURANCE COMPANY OF AMERICA

By:

Name:

Title:    Vice President

SCHEDULE A 

INFORMATION RELATING
TO PURCHASER 

Principal
Amount of

Name and Address of
Purchaser Notes to be Purchased 

THE PRUDENTIAL INSURANCE
COMPANY OF AMERICA 

¥9,706,500,000

          	(1)

 Bank: 	  	
               All payments by wire transfer of immediately available funds to: 

                   Bank of New York

                             Tokyo, Japan
 Account:     Bank of New
York, NY 
Account No.:     4800023950
 Sub-Account:     Prudential Global Funding
Sub-Account No.:    8033804238

               

Each such wire transfer shall set
forth the name of the Company, and a reference to 3.03% Senior Notes due 2010, PPN 67018T
A* 6, INV_____, and the due date and application (as among principal, interest and
Make-Whole Amount) of the payments being made. 

     (2)    
          All notices of payments and written confirmations of such wire transfers: 

The Prudential Insurance
Company of America
 c/o Prudential Capital Group 
Gateway Center Three 
100 Mulberry
Street 

Newark, New Jersey
07102-4077 

Attention:    Manager, Investment Operations Group
Telephone:    (973) 802-5260 

Facsimile:     (973) 802-8055 

     (3)    
          All other communications: 

The Prudential Insurance
Company of America
c/o Prudential Capital Group – Corporate Finance 
Four Embarcadero
Center, Suite 2700
San Francisco, California 94111-4180 

Attention:    Managing Director
Telephone:     (415) 291-5058
 Facsimile:     (415) 421-6233 

SCHEDULE
B

DEFINED TERMS 

As used herein, the following terms
have the respective meanings set forth below or set forth in the Section hereof following
such term: 

        
“ABN Amro Facility” means the $10,000,000 credit facility evidenced by that
certain Grid Note dated as of May 24, 2000 executed by the Company in favor of ABN Amro
Bank N.V., as such Grid Note may be amended, supplemented or modified from time to time. 

“ABN Amro Release of
Guarantors” means the Release of Guarantors executed by ABN Amro Bank N.V. 

“ABN Amro Subsidiary Guaranty”
means that certain Subsidiary Guaranty, dated as of July 22, 1998, executed by certain
subsidiaries of the Company, in favor of ABN Amro Bank N.V. in connection with the ABN
Amro Facility. 

“Affiliate” means,
at any time, (a) with respect to any Person, any other Person that at such time directly
or indirectly through one or more intermediaries Controls, or is Controlled by, or is
under common Control with, such first Person, and (b) with respect to the Company and its
Subsidiaries, any Person beneficially owning or holding, directly or indirectly, 5% or
more of any class of voting or equity interests of the Company or any of its Subsidiaries
or any corporation of which the Company and its Subsidiaries beneficially own or hold, in
the aggregate, directly or indirectly, 5% or more of any class of voting or equity
interests. As used in this definition, “Control” means the possession,
directly or indirectly, of the power to direct or cause the direction of the management
and policies of a Person, whether through the ownership of voting securities, by contract
or otherwise. Unless the context otherwise clearly requires, any reference to an
“Affiliate” is a reference to an Affiliate of the Company. 

“Business Day” means
(a) for the purposes of Section 8.6 only, any day other than a Saturday, a Sunday
or a day on which commercial banks in Tokyo, Japan are required or authorized to be
closed, and (b) for the purposes of any other provision of this Agreement, any day
other than a Saturday, a Sunday or a day on which commercial banks in New York, New York
are required or authorized to be closed. 

“Capital Lease”
means, at any time, a lease with respect to which the lessee is required concurrently to
recognize the acquisition of an asset and the incurrence of a liability in accordance with
GAAP. 

“Closing” is
defined in Section 3. 

“Code” means the
Internal Revenue Code of 1986, as amended from time to time, and the rules and regulations
promulgated thereunder from time to time. 

“Collateral Agency and
Intercreditor Agreement” means the Collateral Agency and Intercreditor Agreement,
substantially in the form of Exhibit 4.13(c) hereto, by and among the Collateral
Agent, you and each of the other Senior Secured Creditors, and acknowledged by the Company
and the Subsidiary Guarantors, as such agreement may be amended, supplemented or modified
from time to time. 

“Collateral Agent”
means State Street Bank and Trust Company of California, N.A., acting in its capacity as
collateral agent under the Collateral Agency and Intercreditor Agreement, together with
its successors and assigns. 

“Collateral
Documents” means the Pledge Agreement, the Subsidiary Guaranty, the Collateral
Agency and Intercreditor Agreement, and all other documents, evidencing, securing or
relating to the Notes, the payment of the indebtedness evidenced by the Notes and all
other amounts due from the Company or any Restricted Subsidiary evidenced or secured by
this Agreement, the Notes or the Collateral Documents. 

“Company” means Nu
Skin Enterprises, Inc., a Delaware corporation. 

“Confidential
Information” is defined in Section 20. 

“Consolidated Income
Available for Fixed Charges” means, with respect to any period, Consolidated Net
Income for such period plus all amounts deducted in the computation thereof on account of
(a) Fixed Charges, and (b) taxes imposed on or measured by income or excess profits of the
Company and the Restricted Subsidiaries. 

“Consolidated Net
Income” means, with respect to any period, the net income (or loss) of the
Company and the Restricted Subsidiaries for such period (taken as a cumulative whole), as
determined in accordance with GAAP, after eliminating all offsetting debits and credits
between the Company and the Restricted Subsidiaries and all other items required to be
eliminated in the course of the preparation of consolidated financial statements of the
Company and the Restricted Subsidiaries in accordance with GAAP. 

“Consolidated Net
Worth” means, at any time, (a) the consolidated stockholders’ equity of the
Company and the Restricted Subsidiaries, as defined according to GAAP, less (b) the
sum of (i) to the extent included in clause (a), all amounts attributable to minority
interests, if any, in the securities of Restricted Subsidiaries, and (ii) the amount by
which Restricted Investments exceed 20% of the amount determined in clause (a). 

“Consolidated
Total Assets” means, at any date of determination, on a consolidated
basis for the Company and the Restricted Subsidiaries, total assets, determined in
accordance with GAAP. 

“Credit Facility”
means any credit facility providing for the borrowing of money or the issuance of letters
of credit (a) for the Company, or (b) for any Restricted Subsidiary, if its obligations
under such credit facility are guaranteed by the Company. 

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

“Default Rate” means
that rate of interest that is 2% per annum above the rate of interest stated in clause (a)
of the first paragraph of the Notes. 

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

“Domestic
Subsidiary” means, at any time, each Subsidiary of the Company (a) which is
created, organized or domesticated in the United States or under the law of the United
States or any state or territory thereof, (b) which was included as a member of the
Company’s affiliated group in the Company’s most recent consolidated United
States federal income tax return, or (c) the earnings of which were includable in the
taxable income of the Company or any other Domestic Subsidiary (to the extent of the
Company’s and/or such other Domestic Subsidiary’s ownership interest of such
Subsidiary) in the Company’s most recent consolidated United States federal income
tax return. 

“EBITDA” means, with
respect to any period, the sum of (i) Consolidated Net Income for such period without
giving effect to extraordinary gains and losses, gains and losses resulting from changes
in GAAP and one time non-recurring income and expenses resulting from acquisitions and
similar events, plus (ii) to the extent deducted in the calculation of
Consolidated Net Income, the amount of all interest expense, depreciation expense,
amortization expense, and income tax expense; provided that EBITDA will include or
exclude, as applicable, acquisitions and divestitures of Restricted Subsidiaries or other
business units on a pro forma basis as if such acquisitions or divestitures occurred on
the first day of the applicable period. 

“Environmental Laws”
means any and all Federal, state, local, and foreign statutes, laws, regulations,
ordinances, rules, judgments, orders, decrees, permits, concessions, grants, franchises,
licenses, agreements or governmental restrictions relating to pollution and the protection
of the environment or the release of any materials into the environment, including but not
limited to those related to hazardous substances or wastes, air emissions and discharges
to waste or public systems. 

“Equity Securities”
of any Person means (a) all common stock, Preferred Stock, participations, shares,
partnership interest, membership interest or other equity interest in and of such Person
(regardless of how designated and whether or not voting or non-voting), and (b) all
warrants, options and other rights to acquire any of the foregoing. 

“ERISA” means the
Employee Retirement Income Security Act of 1974, as amended from time to time, and the
rules and regulations promulgated thereunder from time to time in effect. 

“ERISA Affiliate”
means any trade or business (whether or not incorporated) that is treated as a single
employer together with the Company under section 414 of the Code. 

“Event of Default”
is defined in Section 11. 

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

“Existing Credit
Facility” means the $180,000,000 Credit Agreement dated as of May 8, 1998 by and
among the Company, Nu Skin Japan Co., Ltd., the lenders named therein, and ABN Amro Bank
N.V., as agent for such lenders, as such agreement may have been amended, supplemented or
modified from time to time. 

“Fixed Charges”
means, with respect to any period, the sum of (i) Interest Expense for such period, and
(ii) Lease Rentals for such period. 

“Foreign Subsidiary”
means, at any time, each Subsidiary of the Company that is not a Domestic Subsidiary. 

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

“Governmental
Authority” means 

     (a)    
          the government of 

         (i)       
          the United States of America or any State or other political subdivision
          thereof, or 

         (ii)       
          Japan or any political subdivision thereof, or 

         (iii)       
          any jurisdiction in which the Company or any Subsidiary conducts all or any part
          of its business, or which asserts jurisdiction over any properties of the
          Company or any Subsidiary, or 

     (b)    
          any entity exercising executive, legislative, judicial, regulatory or
          administrative functions of, or pertaining to, any such government. 

“Guaranty” means,
with respect to any Person, any obligation (except the endorsement in the ordinary course
of business of negotiable instruments for deposit or collection) of such Person
guaranteeing or in effect guaranteeing any indebtedness, dividend or other obligation of
any other Person in any manner, whether directly or indirectly, including (without
limitation) obligations incurred through an agreement, contingent or otherwise, by such
Person: 

     (a)    
          to purchase such indebtedness or obligation or any property constituting
          security therefor; 

     (b)    
          to advance or supply funds (i) for the purchase or payment of such
          indebtedness or obligation, or (ii) to maintain any working capital or
          other balance sheet condition or any income statement condition of any other
          Person or otherwise to advance or make available funds for the purchase or
          payment of such indebtedness or obligation; 

     (c)    
          to lease properties or to purchase properties or services primarily for the
          purpose of assuring the owner of such indebtedness or obligation of the ability
          of any other Person to make payment of the indebtedness or obligation; or 

     (d)    
          otherwise to assure the owner of such indebtedness or obligation against loss in
          respect thereof. 

In any computation of the
indebtedness or other liabilities of the obligor under any Guaranty, the indebtedness or
other obligations that are the subject of such Guaranty shall be assumed to be direct
obligations of such obligor. 

“Hazardous Material”
means any and all pollutants, toxic or hazardous wastes or any other substances that might
pose a hazard to health or safety, the removal of which may be required or the generation,
manufacture, refining, production, processing, treatment, storage, handling,
transportation, transfer, use, disposal, release, discharge, spillage, seepage, or
filtration of which is or shall be restricted, prohibited or penalized by any applicable
law (including, without limitation, asbestos, urea formaldehyde foam insulation and
polychlorinated biphenyls). 

“holder” means, with
respect to any Note, the Person in whose name such Note is registered in the register
maintained by the Company pursuant to Section 13.1. 

“Indebtedness” with
respect to any Person means, at any time, without duplication, 

     (a)    
          its liabilities for borrowed money and its redemption obligations in respect of
          mandatorily redeemable Preferred Stock; 

     (b)    
          its liabilities for the deferred purchase price of property acquired by such
          Person (excluding accounts payable arising in the ordinary course of business
          but including all liabilities created or arising under any conditional sale or
          other title retention agreement with respect to any such property); 

     (c)    
          all liabilities appearing on its balance sheet in accordance with GAAP in
          respect of Capital Leases; 

     (d)    
          all liabilities for borrowed money secured by any Lien with respect to any
          property owned by such Person (whether or not it has assumed or otherwise become
          liable for such liabilities); 

     (e)    
          Securitization Debt; and 

     (f)    
          any Guaranty (other than the Subsidiary Guaranty) of such Person with respect to
          liabilities of a type described in any of clauses (a) through (e) hereof. 

Indebtedness of any Person shall
include all obligations of such Person of the character described in clauses (a) through
(f) to the extent such Person remains legally liable in respect thereof notwithstanding
that any such obligation is deemed to be extinguished under GAAP. 

“Institutional
Investor” means (a) any original purchaser of a Note, and (b)
any bank, trust company, savings and loan association or other financial institution, any
pension plan, any investment company, any insurance company, any broker or dealer, or any
other similar financial institution or entity, regardless of legal form, holding more than
the Yen-equivalent of $2,000,000 of the aggregate principal amount of the Notes then
outstanding or more than 20% of the aggregate principal amount of the Notes then
outstanding. 

“Interest Expense”
means, with respect to the Company and the Restricted Subsidiaries for any period, the
sum, determined on a consolidated basis in accordance with GAAP, of (a) all interest paid,
accrued or scheduled for payment on the Indebtedness of the Company and the Restricted
Subsidiaries during such period (including interest attributable to Capital Leases),
plus (b) all fees in respect of outstanding letters of credit paid, accrued or
scheduled for payment by the Company and the Restricted Subsidiaries during such period. 

“Investment” means
any investment, made in cash or by delivery of property, by the Company or any Restricted
Subsidiary (a) in any Person, whether by acquisition of stock, Indebtedness or other
obligation or Security, or by loan, Guaranty, advance, capital contribution or otherwise;
or (b) in any property. 

“Lease Rentals”
means, with respect to any period, the sum of the rental and other obligations required to
be paid during such period by the Company or any Restricted Subsidiary as lessee under all
leases of real or personal property (other than Capital Leases) as determined on a
consolidated basis for the Company and the Restricted Subsidiaries in accordance with
GAAP. 

“Lien” means, with
respect to any Person, any mortgage, lien, pledge, charge, security interest or other
encumbrance, or any interest or title of any vendor, lessor, lender or other secured party
to or of such Person under any conditional sale or other title retention agreement or
Capital Lease, upon or with respect to any property or asset of such Person (including in
the case of stock, stockholder agreements, voting trust agreements and all similar
arrangements). 

“Make-Whole Amount”
is defined in Section 8.6. 

“Material” or
“Materially” means material or materially, as the case may be, in
relation to the business, operations, affairs, financial condition, assets, properties or
prospects of the Company and the Restricted Subsidiaries taken as a whole. 

“Material Adverse
Effect” means a material adverse effect on (a) the business, operations,
affairs, financial condition, assets or properties of the Company and the Restricted
Subsidiaries taken as a whole, or (b) the ability of the Company and the Restricted
Subsidiaries, taken as a whole, to perform their obligations under this Agreement, the
Notes and the Collateral Documents, or (c) the validity or enforceability of this
Agreement, the Notes or any of the Collateral Documents. 

“Material Domestic
Subsidiary” means each Domestic Subsidiary of the Company that also is a Material
Subsidiary. 

“Material Foreign
Subsidiary” means each Foreign Subsidiary of the Company that also is a Material
Subsidiary. 

“Material
Subsidiaries” means, at any time, (a) Nu Skin Japan Co., Ltd., a Japanese
corporation, Nu Skin International, Inc., a Utah corporation, Nu Skin Hong Kong, Inc., a
Utah corporation, Nu Skin Taiwan, Inc., a Utah corporation, and Nu Skin United States,
Inc., a Delaware corporation; and (b) each other Subsidiary of the Company which (i) had
revenues during the four most recently ended fiscal quarters equal to or greater than 5.0%
of the consolidated total revenues of the Company and its Subsidiaries during such period,
or (ii) is an obligor under any Guaranty with respect to the Indebtedness of the Company
under any Significant Credit Facility. 

“Memorandum” is
defined in Section 5.3. 

“Multiemployer Plan”
means any Plan that is a “multiemployer plan” (as such term is defined in
section 4001(a)(3) of ERISA). 

“New Notes” means
the senior notes expected to be issued by the Company in connection with a private
placement of an additional $60,000,000 of Term Debt. 

“Notes” is
defined in Section 1. 

“Officer’s
Certificate” means a certificate of a Senior Financial Officer or of any other
officer of the Company whose responsibilities extend to the subject matter of such
certificate. 

“PBGC” means the
Pension Benefit Guaranty Corporation referred to and defined in ERISA or any successor
thereto. 

“Permitted Securitization
Program” means any transaction or series of transactions that may be entered into
by the Company or any Restricted Subsidiary pursuant to which the Company or any
Restricted Subsidiary may sell, convey or otherwise transfer to (i) a Securitization
Entity (in the case of a transfer by the Company or any Restricted Subsidiary) and (ii)
any other Person (in the case of a transfer by a Securitization Entity), or may grant a
security interest in, any receivables (whether now existing or arising or acquired in the
future) of the Company or any Restricted Subsidiary, and any assets related thereto
including (A) all collateral securing such receivables, (B) all contracts and contract
rights and all guarantees or other obligations in respect of such receivables, (C)
proceeds of such receivables, and (D) other assets (including contract rights) that are
customarily transferred or in respect of which security interests are customarily granted
in connection with asset securitization transactions involving receivables;
provided that the resultant Securitization Debt, together with all other Priority
Indebtedness then outstanding, shall not exceed the amount of Priority Indebtedness
permitted by Section 10.5(a)(ii). 

“Person” means an
individual, partnership, corporation, limited liability company, association, trust,
unincorporated organization, or a government or agency or political subdivision thereof. 

“Plan” means an
“employee benefit plan” (as defined in section 3(3) of ERISA) that is or, within
the preceding five years, has been established or maintained, or to which contributions
are or, within the preceding five years, have been made or required to be made, by the
Company or any ERISA Affiliate or with respect to which the Company or any ERISA Affiliate
may have any liability. 

“Pledge Agreement”
means the Pledge Agreement, in substantially the form of Exhibit 4.13(b) hereto,
dated as of the date hereof, executed and delivered by the Pledgors and the Collateral
Agent, as amended, supplemented and modified from time to time. 

“Pledged Securities”
means (a) the Equity Securities described in Schedule I attached to the Pledge
Agreement and the Equity Securities of each Person that becomes a Material Foreign
Subsidiary, including all securities convertible into, and rights, warrants, options and
other rights to purchase or otherwise acquire, any of the foregoing now or hereafter owned
by such Pledgor, and the certificates or other instruments representing any of the
foregoing and any interest of such Pledgor in the entries on the books of any securities
intermediary pertaining thereto (the “Pledged Shares”), and all
dividends, distributions, returns of capital, cash, warrants, option, rights, instruments,
right to vote or manage the business of such Person pursuant to organizational documents
governing the rights and obligations of the stockholders, and other property or proceeds
from time to time received, receivable or otherwise distributed in respect of or in
exchange for any or all of such Pledged Shares; provided, that the Pledged Shares
shall not include any Equity Securities of such issuer in excess of the number of shares
or other equity interests of such issuer possessing up to but not exceeding 65% of the
voting power of all classes of Equity Securities entitled to vote of such issuer, and all
dividends, cash, warrants, rights, instruments and other property or proceeds from time to
time received, receivable or otherwise distributed in respect of or in exchange for any or
all of such Equity Securities; and (b) to the extent not covered by clause (a) above, all
proceeds of any or all of the foregoing. 

“Pledgor” means each
Person who pledges Pledged Securities under the Pledge Agreement. 

“Preferred Stock”
means any class of capital stock of a corporation that is preferred over any other class
of capital stock of such corporation as to the payment of dividends or the payment of any
amount upon liquidation or dissolution of such corporation. 

“Priority
Indebtedness” means (without duplication) the sum of (a) any unsecured
Indebtedness of the Restricted Subsidiaries other than (i) guarantees under the Subsidiary
Guaranty, (ii) Indebtedness of a Restricted Subsidiary if (x) the Company has guaranteed
such Indebtedness or is a primary obligor of such Indebtedness, and (y) the holder of such
Indebtedness becomes a party to the Collateral Agency and Intercreditor Agreement
(provided that until the holder of such Indebtedness becomes a party to the
Collateral Agency and Intercreditor Agreement, such Indebtedness will be considered
Priority Indebtedness), and (iii) Indebtedness owed to the Company or any other Restricted
Subsidiary, and (b) Indebtedness of the Company and its Restricted Subsidiaries secured by
a Lien not permitted by paragraphs (a) through (m) of Section 10.3, and
(c) Securitization Debt. 

“property” or
“properties” means and includes each and every interest in any property
or asset, whether tangible or intangible and whether real, personal or mixed. 

“QPAM Exemption”
means Prohibited Transaction Class Exemption 84-14 issued by the United States Department
of Labor. 

“Required Holders”
means, at any time, the holders of more than 50% in principal amount of the Notes at the
time outstanding (exclusive of Notes then owned by the Company or any of its Affiliates). 

“Responsible
Officer” means any Senior Financial Officer and any other officer of the Company
or its Subsidiaries with responsibility for the administration of the relevant portion of
this Agreement or the Collateral Documents. 

“Restricted
Investments” means all Investments except any of the following: (i) property to
be used in the ordinary course of business; (ii) assets arising from the sale of goods and
services in the ordinary course of business; (iii) Investments in one or more Restricted
Subsidiaries or any Person that immediately becomes a Restricted Subsidiary; (iv)
Investments existing at the date of Closing; (v) Investments in obligations, maturing
within one year, issued by or guaranteed by the United States of America, or an agency
thereof, or Canada, or any province thereof; (vi) Investments in tax-exempt
obligations, maturing within one year, which are rated in one of the top two rating
classifications by at least one national rating agency; (vii) Investments in certificates
of deposit or banker’s acceptances maturing within one year issued by Bank of America
or other commercial banks which are rated in one of the top two rating classifications by
at lest one national rating agency; (viii) Investments in commercial paper, maturing
within 270 days, rated in one of the top two rating classifications by at least one
national rating agency; (ix) Investments in repurchase agreements; (x) treasury stock;
(xi) Investments in money market instrument programs which are classified as current
assets in accordance with GAAP; (xii) Investments in foreign currency risk hedging
contracts used in the ordinary course of business; and (xiii) Investments in
Securitization Entities. 

“Restricted
Subsidiary” means any Subsidiary (a) at least a majority of the voting securities
of which are owned by the Company and/or one or more Wholly-Owned Restricted Subsidiaries,
and (b) which the Company has not designated as an Unrestricted Subsidiary in accordance
with Section 10.8; provided that upon any Unrestricted Subsidiary becoming a
Material Subsidiary, it shall immediately be deemed to be a Restricted Subsidiary. 

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

“Security” has the
meaning set forth in section 2(l) of the Securities Act. 

“Securitization
Debt” for the Company and the Restricted Subsidiaries shall mean, in connection
with any Permitted Securitization Program, (a) any amount as to which any Securitization
Entity or other Person has recourse to the Company or any Restricted Subsidiary with
respect to such Permitted Securitization Program by way of a Guaranty and (b) the amount
of any reserve account or similar account or asset shown as an asset of the Company or a
Restricted Subsidiary under GAAP that has been pledged to any Securitization Entity or any
other Person in connection with such Permitted Securitization Program. 

“Securitization
Entity” means a wholly-owned Subsidiary (other than a Restricted Subsidiary)
of the Company (or another Person in which the Company or any of its Subsidiaries makes an
investment and to which the Company or any of its Subsidiaries transfers receivables and
related assets) that engages in no activities other than in connection with the financing
of receivables and that is designated by the Board of Directors of the Company (as
provided below) as a Securitization Entity (i) no portion of the Indebtedness or any other
obligations (contingent or otherwise) of which (A) is guaranteed by the Company or any of
its Subsidiaries (excluding guarantees of obligations (other than the principal of, and
interest on, Indebtedness) pursuant to Standard Securitization Undertakings), (B) is
recourse to or obligates the Company or any of its Subsidiaries in any way other than
pursuant to Standard Securitization Undertakings, or (C) subjects any property or asset of
the Company or any other Subsidiary of the Company, directly or indirectly, continently or
otherwise, to the satisfaction thereof, other than pursuant to Standard Securitization
Undertakings, (ii) with which neither the Company nor any of its Subsidiaries has any
material contract, agreement, arrangement or understanding other than on terms no less
favorable to the Company or such Subsidiary than those that might be obtained at the time
from Persons that are not Affiliates of the Company, other than fees payable in the
ordinary course of business in connection with servicing receivables of such entity, and
(iii) to which neither the Company nor any of its Subsidiaries has any obligation to
maintain or preserve such entity’s financial condition or cause such entity to
achieve certain levels of operating results. 

“Senior Financial
Officer” means the chief financial officer, principal accounting officer,
treasurer or comptroller of the Company. 

“Senior Secured
Creditor” means (a) each holder of a Note, (b) each holder of a New Note, and (c)
each lender under a Significant Credit Facility, including the lenders under the ABN
Amro Facility. 

“Senior Secured
Indebtedness” means the Indebtedness of the Company under (a) this Agreement and
the Notes, (b) the New Notes, and (c) any Significant Credit Facility (including, without
limitation, Indebtedness of the Company under the ABN Amro Facility. 

“Significant Credit
Facility” means (a) any Credit Facility that has at least $7,500,000 available to
be borrowed and/or outstanding at any time, and (b) any Credit Facility if the aggregate
amount available to be borrowed and/or outstanding under all of the Credit Facilities
exceeds $25,000,000 at any time; provided that the term “Significant Credit
Facility” shall not include any Priority Indebtedness to the extent that such
Priority Indebtedness is permitted by Section 10.5(a)(ii), any Indebtedness secured by a
Lien permitted by Section 10.3(h), or any Indebtedness secured by a Lien renewing,
extending or replacing Liens as described in Section 10.3(m). 

“Standard Securitization
Undertakings” means representations, warranties, covenants and indemnities
entered into by the Company or any of its Subsidiaries that are reasonably customary in a
receivables securitization transaction. 

“Subsidiary” means,
as to any Person, (a) any corporation of which more than 50% of the issued and outstanding
Equity Securities having ordinary voting power to elect a majority of the Board of
Directors of such corporation (irrespective of whether at the time capital stock of any
other class or classes of such corporation shall or might have voting power upon the
occurrence of any contingency) is at the time directly or indirectly owned or controlled
by such Person, by such Person and one or more of its Subsidiaries or by one or more of
such Person’s other Subsidiaries, (b) any partnership, joint venture, limited
liability company or other association of which more than 50% of the equity interest
having the power to vote, direct or control the management of such partnership, joint
venture, limited liability company or other association is at the time owned and
controlled by such Person, by such Person and one or more of the other Subsidiaries or by
one or more of such Person’s other Subsidiaries, or (c) any other Person included in
the financial statements of such Person on a consolidated basis.. Unless the context
otherwise clearly requires, any reference to a “Subsidiary” is a reference to a
Subsidiary of the Company. 

“Subsidiary
Guarantors” means all current and future Material Domestic Subsidiaries of
the Company. 

“Subsidiary
Guaranty” means that certain Subsidiary Guaranty, substantially in the form of
Exhibit 4.13(a) hereto, dated as of the date hereof, executed and delivered by the
Subsidiary Guarantors, as amended, supplemented and modified from time to time. 

“Swap Agreement”
means (a) any and all rate swap transactions, basis swaps, forward rate transactions,
interest rate options, forward foreign exchange transactions, cap transactions, floor
transactions, collar transactions, currency swap transactions, cross-currency rate swap
transactions, currency options, or any other similar transactions or any combination of
any of the foregoing (including any options to enter into any of the foregoing), provided
that any such transaction is governed by or subject to a Master Agreement, and (b) any and
all transactions of any kind, and the related confirmations, which are subject to the
terms and conditions of, or governed by, any form of master agreement published by the
International Swaps and Derivatives Association, Inc., or any other master agreement
published by any successor organization thereto (any such master agreement, together with
any related schedules, as amended, restated, extended, supplemented or otherwise modified
in writing from time to time, a “Master Agreement”), including any such
obligations or liabilities under any Master Agreement. 

“Taxes” is
defined in Section 14.4(a). 

“Term Debt” means
any Indebtedness of Company or any Restricted Subsidiary other than (a) Credit Facilities
providing for the borrowing of money or the issuance of letters of credit on a revolving
basis or for working capital, (b) Priority Indebtedness, and (c) Indebtedness secured by
Liens permitted by paragraphs (a) through (m) of Section 10.3. 

“Total
Indebtedness” means, at any date of determination, the sum of (i) the
total of all Indebtedness of the Company and the Restricted Subsidiaries outstanding on
such date, after eliminating all offsetting debits and credits between the Company and the
Restricted Subsidiaries and all other items required to be eliminated in the course of the
preparation of consolidated financial statements of the Company and the Restricted
Subsidiaries in accordance with GAAP, plus (ii) the aggregate amount of
Indebtedness of the Company to any of its Restricted Subsidiaries that is not subordinated
to the Notes pursuant to a subordination agreement substantially in the form set forth in
Exhibit 2. 

“Unrestricted
Subsidiary” means any Subsidiary which is designated as an Unrestricted
Subsidiary on Schedule 5.4 attached hereto or is designated as such in writing by
the Company to each of the holders of the Notes pursuant to Section 10.8; provided
that no Material Subsidiary shall be an Unrestricted Subsidiary. 

“Wholly-Owned Restricted
Subsidiary” means, at any time, (a) with respect to Domestic Subsidiaries, any
Restricted Subsidiary one hundred percent (100%) of all of the equity interests (except
directors’ qualifying shares) and voting interests of which are owned by any one or
more of the Company and the Company’s other wholly-owned Restricted Subsidiaries at
such time, and (b) with respect to Foreign Subsidiaries, any Restricted Subsidiary
ninety-five percent (95%) of all of the equity interests (except directors’
qualifying shares) and voting interests of which are owned by any one or more of the
Company and the Company’s other Wholly-Owned Restricted Subsidiaries at such time. 

“Yen” and
“¥” mean the lawful currency of Japan and, in relation to any payment
under this Agreement, same day or immediately available funds.Exhibit 10.5 to NSE FORM 10-K 2005 Pledge Agreement

NU SKIN ENTERPRISES,
INC. 

PLEDGE AGREEMENT 

        This
PLEDGE AGREEMENT (this “Agreement”) is dated as of October 12, 2000 and
is entered into by and among Nu Skin Enterprises, Inc., a Delaware corporation
(“Company”), each Additional Pledgor that may become a party hereto after
the date hereof in accordance with Section 16 hereof (each of Company and each Additional
Pledgor being a “Pledgor” and collectively “Pledgors”),
and State Street Bank and Trust Company of California, N.A. (“Secured
Party”), as agent for and on behalf of the other Benefitted Parties party to the
Collateral Agency and Intercreditor Agreement referred to below. 

 PRELIMINARY STATEMENTS

             A.       
          The Prudential Insurance Company of America (“Prudential”) is
          purchasing an aggregate principal amount of JP¥9,706,500,000 of
          Company’s Senior Secured Notes due October 12, 2010 (the
          “Notes”) pursuant to that certain Note Purchase Agreement dated
          as of October 12, 2000 by and between Company and Prudential (such agreement, as
          it may hereafter be amended, supplemented or otherwise modified from time to
          time, being the “Note Purchase Agreement,” the terms
          defined therein and not otherwise defined herein being used herein as therein
          defined), and it is desired that the obligations of Company under the Note
          Purchase Agreement and the Notes be secured hereunder. 

             B.       
          The Note Purchase Agreement requires Company to (i) pledge, or cause a pledge
          of, 65% of the Equity Securities of each Material Foreign Subsidiary to Secured
          Party, for the ratable benefit of the Benefitted Parties (as defined in the
          Collateral Agency and Intercreditor Agreement), as security for the Notes, and
          (ii) take all actions as may be necessary or desirable to give to Secured Party,
          for the ratable benefit of the Benefitted Parties, a valid and perfected first
          priority Lien on and security interest in the Pledged Collateral. 

             C.       
          Secured Party, Prudential and each of the other Benefitted Parties have entered
          into that certain Collateral Agency and Intercreditor Agreement dated as of
          October 12, 2000 (such agreement, as it may hereafter be amended, supplemented
          or otherwise modified from time to time, being the “Collateral Agency
          and Intercreditor Agreement”). 

             D.       
          Company is the legal and beneficial owner of all of the Equity Securities of Nu
          Skin Japan Co., Ltd., a Japanese corporation (“Nu Skin Japan”). 

             E.       
          It is a condition precedent to Prudential’s obligation to purchase and pay
          for the Notes that Pledgors shall have granted the security interest and
          undertaken the obligations contemplated by this Agreement and the Note Purchase  Agreement. 

             F.       
          This Agreement, the Note Purchase Agreement and each of the other documents
          relating to the Secured Obligations (as defined in Section 2) are hereinafter
          referred to collectively as the “Senior Secured Loan
          Documents.” 

        NOW,
THEREFORE, in consideration of the premises and in order to induce Prudential to purchase
and for the Notes under the Note Purchase Agreement, and for other good and valuable
consideration, the receipt and adequacy of which are hereby acknowledged, each Pledgor
hereby agrees with Secured Party as follows: 

        SECTION
1.     Pledge of Security.     Each Pledgor hereby pledges and assigns to
Secured Party, and hereby grants to Secured Party a first priority security interest in,
all of such Pledgor’s right, title and interest in and to the following (the
“Pledged Collateral”): 

                 (a)       
          the Equity Securities described in Schedule I attached hereto for such
          Pledgor and the Equity Securities of each Person that becomes a Material Foreign
          Subsidiary, including all securities convertible into, and rights, warrants,
          options and other rights to purchase or otherwise acquire, any of the foregoing
          now or hereafter owned by such Pledgor, and the certificates or other
          instruments representing any of the foregoing and any interest of such Pledgor
          in the entries on the books of any securities intermediary pertaining thereto
          (the “Pledged Shares”), and all dividends, distributions,
          returns of capital, cash, warrants, option, rights, instruments, right to vote
          or manage the business of such Person pursuant to organizational documents
          governing the rights and obligations of the stockholders, and other property or
          proceeds from time to time received, receivable or otherwise distributed in
          respect of or in exchange for any or all of such Pledged Shares; provided
          that the Pledged Shares shall not include any Equity Securities of such issuer
          in excess of the number of shares or other equity interests of such issuer
          possessing up to but not exceeding 65% of the voting power of all classes of
          Equity Securities entitled to vote of such issuer, and all dividends, cash,
          warrants, rights, instruments and other property or proceeds from time to time
          received, receivable or otherwise distributed in respect of or in exchange for
          any or all of such Equity Securities; and 

                 (b)       
          to the extent not covered by clause (a) above, all proceeds of any or all of the
          foregoing Pledged Collateral. For purposes of this Agreement, the term
          “proceeds” includes whatever is receivable or received when
          Pledged Collateral or proceeds are sold, exchanged, collected or otherwise
          disposed of, whether such disposition is voluntary or involuntary. 

        SECTION
2.     Security for Obligations.     This Agreement secures, and the Pledged
Collateral is collateral security for, the prompt payment or performance in full when due,
whether at stated maturity, by required prepayment, declaration, acceleration, demand or
otherwise (including the payment of amounts that would become due but for the operation of
the automatic stay under Section 362(a) of the Bankruptcy Code, 11 U.S.C. §362(a) or
any similar or comparable laws of jurisdictions outside the United States), of all
obligations and liabilities of every nature of Pledgors now or hereafter existing under or
arising out of or in connection with the Obligations (as defined in the Collateral Agency
and Intercreditor Agreement) and all extensions or renewals thereof, whether for
principal, interest (including without limitation interest that, but for the filing of a
petition in bankruptcy with respect to any Pledgor, would accrue on such Obligations,
whether or not a claim is allowed against 

2

        SECTION
2.     Security for Obligations.     This Agreement secures, and the Pledged
Collateral is collateral security for, the prompt payment or performance in full when due,
whether at stated maturity, by required prepayment, declaration, acceleration, demand or
otherwise (including the payment of amounts that would become due but for the operation of
the automatic stay under Section 362(a) of the Bankruptcy Code, 11 U.S.C. §362(a) or
any similar or comparable laws of jurisdictions outside the United States), of all
obligations and liabilities of every nature of Pledgors now or hereafter existing under or
arising out of or in connection with the Obligations (as defined in the Collateral Agency
and Intercreditor Agreement) and all extensions or renewals thereof, whether for
principal, interest (including without limitation interest that, but for the filing of a
petition in bankruptcy with respect to any Pledgor, would accrue on such Obligations,
whether or not a claim is allowed against 

        SECTION
3.     Delivery of Pledged Collateral.     All certificates or instruments
representing or evidencing the Pledged Collateral shall be delivered to and held by or on
behalf of Secured Party and shall be in suitable form for transfer by delivery or, as
applicable, shall be accompanied by each Pledgor’s endorsement, where necessary, or
duly executed instruments of transfer or assignment in blank, all in form and substance
satisfactory to Secured Party. Upon the occurrence and during the continuation of a
Triggering Event (as defined in the Collateral Agency and Intercreditor Agreement),
Secured Party shall have the right, without notice to Pledgors, to transfer to or to
register in the name of Secured Party or any of its nominees any or all of the Pledged
Collateral; provided that if the Triggering Event is the result of the institution
of an involuntary Bankruptcy Proceeding against the Company, any Subsidiary Guarantor or
any Material Foreign Subsidiary (an “Involuntary Proceeding”), Secured
Party shall not have such right until such proceeding continues for at least 60
consecutive days. In addition, Secured Party shall have the right at any time to exchange
certificates or instruments representing or evidencing Pledged Collateral for certificates
or instruments of smaller or larger denominations. 

        SECTION 4.      Representations and Warranties.  Each Pledgor represents and warrants as follows:

                 (a)       
          Due Authorization, etc. of Pledged Shares. All of the Pledged Shares
          described on Schedule I for such Pledgor have been duly authorized and
          validly issued and are fully paid and non-assessable. 

                 (b)       
          Description of Pledged Shares. The Pledged Shares constitute 65% of the
          voting power of all classes of Equity Securities of each issuer thereof, and
          there are no outstanding warrants, options or other rights to purchase, or other
          agreements outstanding with respect to, or property that is now or hereafter
          convertible into, or that requires the issuance or sale of, any Pledged Shares. 

                 (c)       
          Ownership of Pledged Collateral. Such Pledgor is the legal, record and
          beneficial owner of the Pledged Collateral free and clear of any Lien except for
          Permitted Liens. 

3

                 (d)       
          Governmental Authorizations. No authorization, approval or other action
          by, and no notice to or filing with, any governmental authority or regulatory
          body is required for either (i) the pledge by such Pledgor of the Pledged
          Collateral pursuant to this Agreement and the grant by such Pledgor of the
          security interest granted hereby, (ii) the execution, delivery or
          performance of this Agreement by such Pledgor, or (iii) the exercise by
          Secured Party of the voting or other rights, or the remedies in respect of the
          Pledged Collateral, provided for in this Agreement (except as may be required in
          connection with a disposition of Pledged Collateral by laws affecting the
          offering and sale of securities generally). 

                 (e)       
          Perfection. The pledge of the Pledged Collateral pursuant to this
          Agreement creates a valid and perfected first priority security interest in the
          Pledged Collateral, securing the payment of the Secured Obligations. 

                 (f)       
          Margin Regulations. The pledge of the Pledged Collateral pursuant to this
          Agreement does not violate Regulation T, U or X of the Board of Governors of the
          Federal Reserve System. 

                 (g)       
          Other Information. All information heretofore, herein or hereafter
          supplied to Secured Party by or on behalf of such Pledgor with respect to the
          Pledged Collateral is accurate and complete in all respects. 

                    SECTION 5.      Transfers and Other Liens; Additional Pledged Collateral; etc.      Each Pledgor shall:

                 (a)       
          not, except as expressly permitted by the Senior Secured Loan Documents,
          (i) sell, assign (by operation of law or otherwise) or otherwise dispose
          of, or grant any option with respect to, any of the Pledged Collateral,
          (ii) create or suffer to exist any Lien upon or with respect to any of the
          Pledged Collateral, except for Permitted Liens, or (iii) permit any issuer of
          Pledged Shares to merge or consolidate unless all the outstanding Equity
          Securities of the surviving or resulting corporation is, upon such merger or
          consolidation, pledged hereunder and no cash, securities or other property is
          distributed in respect of the outstanding Equity Securities of any other
          constituent corporation; provided, if the surviving or resulting
          corporation is a foreign corporation, then such Pledgor shall only be required
          to pledge outstanding Equity Securities of such surviving or resulting
          corporation possessing up to but not exceeding 65% of the voting power of all
          classes of Equity Securities of such issuer entitled to vote; 

4

                 (b)       
          (i) cause each issuer of Pledged Shares not to issue any Equity Securities
          in addition to or in substitution for the Pledged Shares issued by such issuer,
          except to such Pledgor or as otherwise permitted by the Senior Secured Loan
          Documents, (ii) pledge hereunder, immediately upon its acquisition
          (directly or indirectly) thereof, any and all additional Equity Securities of
          each issuer of Pledged Shares, and (iii) pledge hereunder, immediately upon
          its acquisition (directly or indirectly) thereof, any and all Equity Securities
          of any Person that, after the date of this Agreement, becomes, as a result of
          any occurrence, a Material Foreign Subsidiary; provided, notwithstanding
          anything contained in clause (ii) or this clause (iii) to the contrary, such
          Pledgor shall only be required to pledge the outstanding Equity Securities up to
          but not exceeding 65% of the voting power of all classes of Equity Securities of
          such controlled foreign corporation entitled to vote; 

                 (c)       
          promptly deliver to Secured Party all written notices received by it with
          respect to the Pledged Collateral (other than customary notices received from a
          governmental or regulatory body and customary and routine notices received from
          the issuer of the Pledged Shares in the ordinary course of business); and 

                 (d)       
          pay promptly when due all taxes, assessments and governmental charges or levies
          imposed upon, and all claims against, the Pledged Collateral, except to the
          extent the validity thereof is being contested in good faith; provided
          that such Pledgor shall in any event pay such taxes, assessments, charges,
          levies or claims not later than five days prior to the date of any proposed sale
          under any judgment, writ or warrant of attachment entered or filed against such
          Pledgor or any of the Pledged Collateral as a result of the failure to make such
          payment. 

                    SECTION 6.      Further Assurances; Pledge Amendments.

                 (a)       
          Each Pledgor agrees that from time to time, at the expense of such Pledgor, such
          Pledgor will promptly execute and deliver all further instruments and documents,
          and take all further action, that may be necessary or desirable, or that Secured
          Party may request, in order to perfect and protect any security interest granted
          or purported to be granted hereby or to enable Secured Party to exercise and
          enforce its rights and remedies hereunder with respect to any Pledged
          Collateral. Without limiting the generality of the foregoing, each Pledgor will:
          (i) execute and file such financing or continuation statements, or
          amendments thereto, and such other instruments or notices, as may be necessary
          or desirable, or as Secured Party may reasonably request, in order to perfect
          and preserve the security interests granted or purported to be granted hereby
          and (ii) at Secured Party’s request, appear in and defend any action
          or proceeding that may affect such Pledgor’s title to or Secured
          Party’s security interest in all or any part of the Pledged Collateral.
          Each Pledgor hereby authorizes Secured Party to file one or more financing or
          continuation statements, and amendments thereto, relative to all or any part of
          the Pledged Collateral without the signature of such Pledgor. Such Pledgor
          agrees that a carbon, photographic or other reproduction of this Agreement or of
          a financing statement signed by such Pledgor shall be sufficient as a financing
          statement and may be filed as a financing statement in any and all
          jurisdictions. 

5

                 (b)       
          Each Pledgor further agrees that it will, upon obtaining any additional shares
          of stock or other Equity Securities required to be pledged hereunder as provided
          in the Note Purchase Agreement, promptly (and in any event within five Business
          Days) deliver to Secured Party a Pledge Amendment, duly executed by Pledgor, in
          substantially the form of Schedule II annexed hereto (a “Pledge
          Amendment”), in respect of the additional Pledged Shares to be pledged
          pursuant to this Agreement. Upon each delivery of a Pledge Amendment to Secured
          Party, the representations and warranties contained in Section 4 hereof shall be
          deemed to have been made by such Pledgor as to the Pledged Collateral described
          in such Pledge Amendment. Pledgor hereby authorizes Secured Party to attach each
          Pledge Amendment to this Agreement and agrees that all Pledged Shares listed on
          any Pledge Amendment delivered to Secured Party shall for all purposes hereunder
          be considered Pledged Collateral; provided that the failure of such
          Pledgor to execute a Pledge Amendment with respect to any additional Pledged
          Shares pledged pursuant to this Agreement shall not impair the security interest
          of Secured Party therein or otherwise adversely affect the rights and remedies
          of Secured Party hereunder with respect thereto. 

      SECTION
7.     Voting Rights; Dividends; Etc. 

                 (a)       
          So long as no Triggering Event shall have occurred and be continuing: 

          		                    (i)       
               each Pledgor shall be entitled to exercise any and all voting and other
               consensual rights pertaining to the Pledged Collateral or any part thereof for
               any purpose not inconsistent with the terms of the Senior Secured Loan
               Documents; provided, however, that such Pledgor shall not exercise
               or refrain from exercising any such right if Secured Party or Required Creditors
               shall have notified such Pledgor that, in Secured Party’s or Required
               Creditors’ judgment, such action would have a material adverse effect on
               the value of the Pledged Collateral or any part thereof; and provided,
               further, that such Pledgor shall give Secured Party and each Senior
               Secured Party at least five Business Days’ prior written notice of the
               manner in which it intends to exercise, or the reasons for refraining from
               exercising, any such right (it being understood, however, that neither
               (A) the voting by such Pledgor of any Pledged Shares for or such
               Pledgor’s consent to the election of directors at a regularly scheduled
               annual or other meeting of stockholders or with respect to incidental matters at
               any such meeting, nor (B) such Pledgor’s consent to or approval of any
               action otherwise not prohibited under this Agreement and each of the other
               Senior Secured Loan Documents shall be deemed inconsistent with the terms of any
               Senior Secured Loan Document within the meaning of this Section 7(a)(i), and no
               notice of any such voting or consent need be given to Secured Party); 

               

6

          		                (ii)       
               each Pledgor shall be entitled to receive and retain, and to utilize free and
               clear of the lien of this Agreement, any and all dividends, other distributions
               and interest paid in respect of the Pledged Collateral; provided,
               however, that any and all dividends, other distributions and interest
               paid or payable other than in cash in respect of, and instruments and other
               property received, receivable or otherwise distributed in respect of, or in
               exchange for, any Pledged Collateral shall be, and shall forthwith be delivered
               to Secured Party to hold as, Pledged Collateral and shall, if received by such
               Pledgor, be received in trust for the benefit of Secured Party, be segregated
               from the other property or funds of such Pledgor and be forthwith delivered to
               Secured Party as Pledged Collateral in the same form as so received (with all
               necessary indorsements); and 

               

          		    (iii)       
               Secured Party shall promptly execute and deliver (or cause to be executed and
               delivered) to each Pledgor all such proxies, dividend payment orders and other
               instruments as such Pledgor may from time to time reasonably request for the
               purpose of enabling such Pledgor to exercise the voting and other consensual
               rights which it is entitled to exercise pursuant to paragraph (i) above and to
               receive the dividends, other distributions, principal or interest payments which
               it is authorized to receive and retain pursuant to paragraph (ii) above. 

               

                 (b)       
          Upon the occurrence and during the continuation of a Triggering Event (other
          than an Involuntary Proceeding) or upon the occurrence and continuation of an
          Involuntary Proceeding for at least 60 consecutive days and during the
          continuation of such Involuntary Proceeding: 

          		                    (i)       
               upon written notice from Secured Party to Pledgors, all rights of Pledgors to
               exercise the voting and other consensual rights which it would otherwise be
               entitled to exercise pursuant to Section 7(a)(i) shall cease, and all such
               rights shall thereupon become vested in Secured Party who shall thereupon have
               the sole right to exercise such voting and other consensual rights; 

               

          		                (ii)       
               all rights of Pledgors to receive the dividends and interest payments which it
               would otherwise be authorized to receive and retain pursuant to Section 7(a)(ii)
               shall cease, and all such rights shall thereupon become vested in Secured Party
               who shall thereupon have the sole right to receive and hold as Pledged
               Collateral such dividends, other distributions and interest payments; and 

               

          		                    (iii)       
               all dividends, principal, interest payments and other distributions which are
               received by Pledgors contrary to the provisions of paragraph (ii) of this
               Section 7(b) shall be received in trust for the benefit of Secured Party, shall
               be segregated from other funds of Pledgors and shall forthwith be paid over to
               Secured Party as Pledged Collateral in the same form as so received (with any
               necessary indorsements). 

               

7

                 (c)       
          In order to permit Secured Party to exercise the voting and other consensual
          rights which it may be entitled to exercise pursuant to Section 7(b)(i) and to
          receive all dividends and other distributions which it may be entitled to
          receive under Section 7(a)(ii) or Section 7(b)(ii), (i) each Pledgor shall
          promptly execute and deliver (or cause to be executed and delivered) to Secured
          Party all such proxies, dividend payment orders and other instruments as Secured
          Party may from time to time reasonably request and (ii) without limiting
          the effect of the immediately preceding clause (i), each Pledgor hereby grants
          to Secured Party an irrevocable proxy to vote the Pledged Shares and to exercise
          all other rights, powers, privileges and remedies to which a holder of the
          Pledged Shares would be entitled (including, without limitation, giving or
          withholding written consents of shareholders, calling special meetings of
          shareholders and voting at such meetings), which proxy shall be effective,
          automatically and without the necessity of any action (including any transfer of
          any Pledged Shares on the record books of the issuer thereof) by any other
          Person (including the issuer of the Pledged Shares or any officer or agent
          thereof), upon the occurrence of a Triggering Event (other than an Involuntary
          Proceeding) or the occurrence and continuation of an Involuntary Proceeding for
          at least 60 consecutive days and which proxy shall only terminate upon the
          payment in full of the Secured Obligations. 

        SECTION
8.     Secured Party Appointed Attorney-in-Fact.     Each Pledgor hereby
irrevocably appoints Secured Party as such Pledgor’s attorney-in-fact, with full
authority in the place and stead of such Pledgor and in the name of such Pledgor, Secured
Party or otherwise, from time to time in Secured Party’s discretion to take any
action and to execute any instrument that Secured Party may deem necessary or advisable to
accomplish the purposes of this Agreement, including without limitation: 

                 (a)       
          to file one or more financing or continuation statements, or amendments thereto,
          relative to all or any part of the Pledged Collateral without the signature of
          Pledgor; 

                 (b)       
          upon the occurrence and during the continuation of a Triggering Event (other
          than an Involuntary Proceeding) or upon the occurrence and continuation of an
          Involuntary Proceeding for at least 60 consecutive days and during the
          continuation of such Involuntary Proceeding, to ask, demand, collect, sue for,
          recover, compound, receive and give acquittance and receipts for moneys due and
          to become due under or in respect of any of the Pledged Collateral; 

                 (c)       
          upon the occurrence and during the continuation of a Triggering Event (other
          than an Involuntary Proceeding) or upon the occurrence and continuation of an
          Involuntary Proceeding for at least 60 consecutive days and during the
          continuation of such Involuntary Proceeding, to receive, endorse and collect any
          instruments made payable to Pledgor representing any dividend, principal or
          interest payment or other distribution in respect of the Pledged Collateral or
          any part thereof and to give full discharge for the same; 

8

                 (d)       
          upon the occurrence and during the continuation of a Triggering Event (other
          than an Involuntary Proceeding) or upon the occurrence and continuation of an
          Involuntary Proceeding for at least 60 consecutive days and during the
          continuation of such Involuntary Proceeding, to file any claims or take any
          action or institute any proceedings that Secured Party may deem necessary or
          desirable for the collection of any of the Pledged Collateral or otherwise to
          enforce the rights of Secured Party with respect to any of the Pledged
          Collateral; 

                 (e)       
          to pay or discharge taxes or Liens (other than Permitted Liens) levied or placed
          upon or threatened against the Pledged Collateral, the legality or validity
          thereof and the amounts necessary to discharge the same to be determined by
          Secured Party in its sole discretion, any such payments made by Secured Party to
          become obligations of such Pledgor to Secured Party, due and payable immediately
          without demand; and 

                 (f)       
          upon the occurrence and during the continuation of a Triggering Event (other
          than an Involuntary Proceeding) or upon the occurrence and continuation of an
          Involuntary Proceeding for at least 60 consecutive days and during the
          continuation of such Involuntary Proceeding, generally to sell, transfer,
          pledge, make any agreement with respect to or otherwise deal with any of the
          Pledged Collateral as fully and completely as though Secured Party were the
          absolute owner thereof for all purposes, and to do, at Secured Party’s
          option and such Pledgor’s expense, at any time or from time to time, all
          acts and things that Secured Party deems necessary to protect, preserve or
          realize upon the Pledged Collateral and Secured Party’s security interest
          therein in order to effect the intent of this Agreement, all as fully and
          effectively as such Pledgor might do. 

        SECTION
9.     Secured Party May Perform.     If any Pledgor fails to perform any
agreement contained herein, Secured Party may itself perform, or cause performance of,
such agreement, and the expenses of Secured Party incurred in connection therewith shall
be payable by such Pledgor under Section 13(b). 

        SECTION
10.     Standard of Care.     The powers conferred on Secured Party hereunder
are solely to protect its interest in the Pledged Collateral and shall not impose any duty
upon it to exercise any such powers. Except for the exercise of reasonable care in the
custody of any Pledged Collateral in the Secured Party’s possession and the
accounting for moneys actually received by it hereunder, Secured Party shall have no duty
as to any Pledged Collateral, it being understood by the parties hereto that Secured Party
shall have no responsibility for (a) ascertaining or taking action with respect to
calls, conversions, exchanges, maturities, tenders or other matters relating to any
Pledged Collateral, whether or not Secured Party or any Senior Secured Creditor has or is
deemed to have knowledge of such matters, (b) taking any necessary steps (other than
steps taken in accordance with the standard of care set forth above to maintain possession
of the Pledged Collateral) to preserve rights against any prior parties or any other
rights pertaining to any Pledged Collateral, (c) taking any necessary steps to
collect or realize upon the Secured Obligations or any guarantee therefor, or any part
thereof, or any of the Pledged Collateral, or (d) initiating any action to protect
the Pledged Collateral against the possibility of a decline in market value. Secured Party
shall be deemed to have exercised reasonable care in the custody and preservation of
Pledged Collateral in its possession if such Pledged Collateral is accorded 

9

 treatment
substantially equal to that which Secured Party accords its own property consisting of
negotiable securities. 

        SECTION
11. Remedies. 

                 (a)       
          If any Triggering Event (other than Involuntary Proceeding) shall have occurred
          and be continuing or any Involuntary Proceeding shall have occurred and be
          continuing for at least 60 consecutive days, Secured Party may exercise in
          respect of the Pledged Collateral, in addition to all other rights and remedies
          provided for herein or otherwise available to it, all the rights and remedies of
          a secured party on default under the Uniform Commercial Code as in effect in any
          relevant jurisdiction (the “UCC”) (whether or not the UCC
          applies to the affected Pledged Collateral), and Secured Party may also in its
          sole discretion, without notice except as specified below, sell the Pledged
          Collateral or any part thereof in one or more parcels at public or private sale,
          at any exchange or broker’s board or at any of Secured Party’s offices
          or elsewhere, for cash, on credit or for future delivery, at such time or times
          and at such price or prices and upon such other terms as Secured Party may deem
          commercially reasonable, irrespective of the impact of any such sales on the
          market price of the Pledged Collateral. Secured Party or any Senior Secured
          Creditor may be the purchaser of any or all of the Pledged Collateral at any
          such sale and Secured Party, as agent for and representative of the Benefitted
          Parties, shall be entitled, for the purpose of bidding and making settlement or
          payment of the purchase price for all or any portion of the Pledged Collateral
          sold at any such public sale, to use and apply any of the Secured Obligations as
          a credit on account of the purchase price for any Pledged Collateral payable by
          Secured Party or any Senior Secured Creditor at such sale. Each purchaser at any
          such sale shall hold the property sold absolutely free from any claim or right
          on the part of Pledgors, and each Pledgor hereby waives (to the extent permitted
          by applicable law) all rights of redemption, stay and/or appraisal which it now
          has or may at any time in the future have under any rule of law or statute now
          existing or hereafter enacted. Each Pledgor agrees that, to the extent notice of
          sale shall be required by law, at least ten days’ notice to Pledgor of the
          time and place of any public sale or the time after which any private sale is to
          be made shall constitute reasonable notification. Secured Party shall not be
          obligated to make any sale of Pledged Collateral regardless of notice of sale
          having been given. Secured Party may adjourn any public or private sale from
          time to time by announcement at the time and place fixed therefor, and such sale
          may, without further notice, be made at the time and place to which it was so
          adjourned. Each Pledgor hereby waives any claims against Secured Party arising
          by reason of the fact that the price at which any Pledged Collateral may have
          been sold at such a private sale was less than the price which might have been
          obtained at a public sale, even if Secured Party accepts the first offer
          received and does not offer such Pledged Collateral to more than one offeree. If
          the proceeds of any sale or other disposition of the Pledged Collateral are
          insufficient to pay all the Secured Obligations, Pledgors shall be jointly and
          severally liable for the deficiency and the fees of any attorneys employed by
          Secured Party or any Senior Secured Creditor to collect such deficiency. 

10

                 (b)       
          Each Pledgor recognizes that, by reason of certain prohibitions contained in the
          Securities Act of 1933, as from time to time amended (the “Securities
          Act”), and applicable state securities laws, Secured Party may be
          compelled, with respect to any sale of all or any part of the Pledged Collateral
          conducted without prior registration or qualification of such Pledged Collateral
          under the Securities Act and/or such state securities laws, to limit purchasers
          to those who will agree, among other things, to acquire the Pledged Collateral
          for their own account, for investment and not with a view to the distribution or
          resale thereof. Each Pledgor acknowledges that any such private sales may be at
          prices and on terms less favorable than those obtainable through a public sale
          without such restrictions (including, without limitation, a public offering made
          pursuant to a registration statement under the Securities Act) and each Pledgor
          agrees that any such private sale shall be deemed to have been made in a
          commercially reasonable manner and that Secured Party shall have no obligation
          to engage in public sales and no obligation to delay the sale of any Pledged
          Collateral for the period of time necessary to permit the issuer thereof to
          register it for a form of public sale requiring registration under the
          Securities Act or under applicable state securities laws, even if such issuer
          would, or should, agree to so register it. 

                 (c)       
          If Secured Party determines to exercise its right to sell any or all of the
          Pledged Collateral, upon written request, each Pledgor shall and shall cause
          each issuer of any Pledged Shares to be sold hereunder from time to time to
          furnish to Secured Party all such information as Secured Party may request in
          order to determine the number of shares and other instruments included in the
          Pledged Collateral which may be sold by Secured Party in exempt transactions
          under the Securities Act and the rules and regulations of the Securities and
          Exchange Commission thereunder, as the same are from time to time in effect. 

        SECTION
12.     Application of Proceeds.     Except as expressly provided elsewhere in
this Agreement, all proceeds received by Secured Party in respect of any sale of,
collection from, or other realization upon all or any part of the Pledged Collateral shall
be applied as provided in the Collateral Agency and Intercreditor Agreement. 

        SECTION
13.     Indemnity and Expenses. 

                 (a)       
          Pledgors jointly and severally agree to indemnify Secured Party and each Senior
          Secured Creditor from and against any and all claims, losses and liabilities in
          any way relating to, growing out of or resulting from this Agreement and the
          transactions contemplated hereby (including, without limitation, enforcement of
          this Agreement), except to the extent such claims, losses or liabilities result
          solely from Secured Party’s or such Senior Secured Creditor’s gross
          negligence or willful misconduct as finally determined by a court of competent
          jurisdiction. 

                 (b)       
          Pledgors jointly and severally agree to pay to Secured Party upon demand the
          amount of any and all costs and expenses, including the reasonable fees and
          expenses of counsel and of any experts and agents, that Secured Party may incur
          in connection with (i) the administration of this Agreement and the
          Collateral Agency and Intercreditor Agreement, (ii) the custody or
          preservation of, or the sale of, collection from, or other realization upon, any
          of the Pledged Collateral, (iii) the exercise or enforcement of any of the
          rights of Secured 

11

      Party hereunder and under the Collateral Agency and
          Intercreditor Agreement, or (iv) the failure by any Pledgor to perform or
          observe any of the provisions hereof. 

        SECTION
14.     Continuing Security Interest; Transfer of Loans.     This Agreement
shall create a continuing security interest in the Pledged Collateral and shall
(a) remain in full force and effect until the payment in full of all Secured
Obligations, the cancellation or termination of all commitments under each Senior Secured
Loan Document, and the cancellation or expiration of all outstanding Letters of Credit (as
defined in the Collateral Agency and Intercreditor Agreement), (b) be binding upon
Pledgor, its successors and assigns, and (c) inure, together with the rights and
remedies of Secured Party hereunder, to the benefit of Secured Party and its successors,
transferees and assigns. Upon the payment in full of all Secured Obligations, the
cancellation or termination of all commitments under each Senior Secured Loan Document,
and the cancellation or expiration of all outstanding Letters of Credit, the security
interest granted hereby shall terminate and all rights to the Pledged Collateral shall
revert to Pledgors. Upon any such termination Secured Party will, at Pledgors’
expense, execute and deliver to Pledgors such documents as Pledgors shall reasonably
request to evidence such termination. 

        SECTION
15.     Secured Party as Agent. 

                 (a)       
          Secured Party has been appointed to act as Secured Party hereunder by the
          Benefitted Parties. Secured Party shall be obligated, and shall have the right
          hereunder, to make demands, to give notices, to exercise or refrain from
          exercising any rights, and to take or refrain from taking any action (including,
          without limitation, the release or substitution of Pledged Collateral), solely
          in accordance with this Agreement and the other Senior Secured Loan Documents;
          provided that Secured Party shall exercise, or refrain from exercising,
          any remedies provided for in Section 11 in accordance with the instructions of
          Requisite Creditors (as defined in the Collateral Agency and Intercreditor
          Agreement). In furtherance of the foregoing provisions of this Section 15, each
          Senior Secured Creditor, by its acceptance of the benefits hereof, agrees that
          it shall have no right individually to realize upon any of the Pledged
          Collateral hereunder, it being understood and agreed by such Senior Secured
          Creditor that all rights and remedies hereunder may be exercised solely by
          Secured Party for the benefit of the Benefitted Parties in accordance with the
          terms of this Section 15. 

                 (b)       
          Secured Party shall at all times be the same Person that is Collateral Agent
          under the Collateral Agency and Intercreditor Agreement. Written notice of
          resignation by the Collateral Agent pursuant to subsection 4(h) of the
          Collateral Agency and Intercreditor Agreement shall also constitute notice of
          resignation as Secured Party under this Agreement; removal of the Collateral
          Agent pursuant to subsection 4(h) of the Collateral Agency and Intercreditor
          Agreement shall also constitute removal as Secured Party under this Agreement;
          and appointment of a successor Collateral Agent pursuant to subsection 4(h) of
          the Collateral Agency and Intercreditor Agreement shall also constitute
          appointment of a successor Secured Party under this Agreement. Upon the
          acceptance of any appointment as Collateral Agent under subsection 4(h) of the
          Collateral Agency and Intercreditor Agreement by a successor Collateral Agent,
          that successor Collateral Agent shall thereupon succeed to and become vested
          with all the rights, powers, privileges and duties of the retiring or removed
          Secured Party under this Agreement, and the retiring or removed Secured Party
          under this Agreement 

12

      shall promptly (i) transfer to such successor Secured
          Party all sums, securities and other items of Collateral held hereunder,
          together with all records and other documents necessary or appropriate in
          connection with the performance of the duties of the successor Secured Party
          under this Agreement, and (ii) execute and deliver to such successor
          Secured Party such amendments to financing statements, and take such other
          actions, as may be necessary or appropriate in connection with the assignment to
          such successor Secured Party of the security interests created hereunder,
          whereupon such retiring or removed Secured Party shall be discharged from its
          duties and obligations under this Agreement. After any retiring or removed
          Agent’s resignation or removal hereunder as Secured Party, the provisions
          of this Agreement shall inure to its benefit as to any actions taken or omitted
          to be taken by it under this Agreement while it was Secured Party hereunder. 

                 (c)       
          Secured Party shall not be deemed to have any duty whatsoever with respect to
          any Additional Senior Lender (as defined in the Collateral Agency and
          Intercreditor Agreement) until Secured Party shall have received written notice
          in form and substance satisfactory to Secured Party from a Pledgor or such
          Additional Senior Lender as to the existence and terms of the applicable Senior
          Secured Loan Documents. 

        SECTION
16.     Additional Pledgors.     Company shall be the initial Pledgor hereunder. From
time to time subsequent to the date hereof, Subsidiary Guarantors may become parties
hereto as additional Pledgors (each an “Additional Pledgor”) by executing
a counterpart of this Agreement substantially in the form of Schedule III annexed
hereto. Upon delivery of any such counterpart to Secured Party, notice of which is hereby
waived by Pledgors, each such Additional Pledgor shall be a Pledgor and shall be as fully
a party hereto as if such Additional Pledgor were an original signatory hereto. Each
Pledgor expressly agrees that its obligations arising hereunder shall not be affected or
diminished by the addition or release of any other Pledgor hereunder, nor by any election
of Secured Party or any Senior Secured Creditor not to cause any Subsidiary
Guarantor to become an Additional Pledgor hereunder. This Agreement shall be fully
effective as to any Pledgor that is or becomes a party hereto regardless of whether any
other Person becomes or fails to become or ceases to be a Pledgor hereunder. 

        SECTION
17.     Amendments; Etc.     No amendment, modification, termination or waiver of any
provision of this Agreement, and no consent to any departure by any Pledgor therefrom,
shall in any event be effective unless the same shall be in writing and signed by Secured
Party and, in the case of any such amendment or modification, by Pledgors. Any such waiver
or consent shall be effective only in the specific instance and for the specific purpose
for which it was given. 

        SECTION
18.     Notices.     Any notice or other communication herein required or permitted to
be given shall be in writing and may be personally served or sent by telefacsimile or
United States mail or courier service and shall be deemed to have been given when
received. For the purposes hereof, the address of each party hereto shall be as set forth
under such party’s name on the signature pages hereof or as such other address as
shall be designated by such party in a written notice delivered to the other party hereto. 

13

        SECTION
19.     Failure or Indulgence Not Waiver; Remedies Cumulative.     No failure or
delay on the part of Secured Party in the exercise of any power, right or privilege
hereunder shall impair such power, right or privilege or be construed to be a waiver of
any default or acquiescence therein, nor shall any single or partial exercise of any such
power, right or privilege preclude any other or further exercise thereof or of any other
power, right or privilege. All rights and remedies existing under this Agreement are
cumulative to, and not exclusive of, any rights or remedies otherwise available. 

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

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

        SECTION
22.     Governing Law; Terms.     THIS AGREEMENT AND THE RIGHTS AND OBLIGATIONS
OF THE PARTIES HEREUNDER SHALL BE GOVERNED BY, AND SHALL BE CONSTRUED AND ENFORCED IN
ACCORDANCE WITH, THE INTERNAL LAWS OF THE STATE OF NEW YORK (INCLUDING, WITHOUT
LIMITATION, SECTION 5-1401 OF THE GENERAL OBLIGATIONS LAW OF THE STATE OF NEW YORK),
WITHOUT REGARD TO CONFLICTS OF LAWS PRINCIPLES, EXCEPT TO THE EXTENT THAT THE UCC PROVIDES
THAT THE PERFECTION OF THE SECURITY INTEREST HEREUNDER, OR REMEDIES HEREUNDER, IN RESPECT
OF ANY PARTICULAR PLEDGED COLLATERAL ARE GOVERNED BY THE LAWS OF A JURISDICTION OTHER THAN
THE STATE OF NEW YORK. Unless otherwise defined herein or in the Note Purchase Agreement,
terms used in Articles 8 and 9 of the Uniform Commercial Code in the State of New York are
used herein as therein defined. The rules of construction set forth in Section 23.4 of the
Note Purchase Agreement shall be applicable to this Agreement mutatis mutandis. 

        SECTION
23.     Consent to Jurisdiction and Service of Process.     ALL JUDICIAL
PROCEEDINGS BROUGHT AGAINST ANY PLEDGOR ARISING OUT OF OR RELATING TO THIS AGREEMENT, OR
ANY OBLIGATIONS HEREUNDER, MAY BE BROUGHT IN ANY STATE OR FEDERAL COURT OF COMPETENT
JURISDICTION IN THE STATE , COUNTY AND CITY OF NEW YORK. BY EXECUTING AND DELIVERING THIS
AGREEMENT, EACH PLEDGOR, FOR ITSELF AND IN CONNECTION WITH ITS PROPERTIES, IRREVOCABLY
(I) ACCEPTS GENERALLY AND UNCONDITIONALLY THE NONEXCLUSIVE JURISDICTION AND VENUE OF
SUCH COURTS; (II) WAIVES ANY DEFENSE OF FORUM NON CONVENIENS;
(III) AGREES THAT SERVICE OF ALL PROCESS IN ANY SUCH PROCEEDING IN ANY SUCH COURT MAY
BE MADE BY REGISTERED OR CERTIFIED MAIL, RETURN RECEIPT REQUESTED, TO SUCH PLEDGOR AT ITS
ADDRESS PROVIDED IN ACCORDANCE WITH SECTION 18; (IV) AGREES THAT SERVICE AS
PROVIDED IN CLAUSE (III) ABOVE IS SUFFICIENT TO CONFER PERSONAL JURISDICTION OVER SUCH
PLEDGOR IN ANY SUCH PROCEEDING IN ANY SUCH COURT, AND  

14

OTHERWISE CONSTITUTES EFFECTIVE AND
BINDING SERVICE IN EVERY RESPECT; (V) AGREES THAT SECURED PARTY RETAINS THE RIGHT TO
SERVE PROCESS IN ANY OTHER MANNER PERMITTED BY LAW OR TO BRING PROCEEDINGS AGAINST SUCH
PLEDGOR IN THE COURTS OF ANY OTHER JURISDICTION; AND (VI) AGREES THAT THE PROVISIONS
OF THIS SECTION 23 RELATING TO JURISDICTION AND VENUE SHALL BE BINDING AND
ENFORCEABLE TO THE FULLEST EXTENT PERMISSIBLE UNDER NEW YORK GENERAL OBLIGATIONS LAW
SECTION 5-1402 OR OTHERWISE. 

        SECTION
24.     Waiver of Jury Trial.     PLEDGORS AND SECURED PARTY HEREBY AGREE TO
WAIVE THEIR RESPECTIVE RIGHTS TO A JURY TRIAL OF ANY CLAIM OR CAUSE OF ACTION BASED UPON
OR ARISING OUT OF THIS AGREEMENT. The scope of this waiver is intended to be
all-encompassing of any and all disputes that may be filed in any court and that relate to
the subject matter of this transaction, including without limitation contract claims, tort
claims, breach of duty claims, and all other common law and statutory claims. Each Pledgor
and Secured Party acknowledge that this waiver is a material inducement for such Pledgor
and Secured Party to enter into a business relationship, that each Pledgor and Secured
Party have already relied on this waiver in entering into this Agreement and that each
will continue to rely on this waiver in their related future dealings. Each Pledgor and
Secured Party further warrant and represent that each has reviewed this waiver with its
legal counsel, and that each knowingly and voluntarily waives its jury trial rights
following consultation with legal counsel. THIS WAIVER IS IRREVOCABLE, MEANING THAT IT MAY
NOT BE MODIFIED EITHER ORALLY OR IN WRITING (OTHER THAN BY A MUTUAL WRITTEN WAIVER
SPECIFICALLY REFERRING TO THIS SECTION 24 AND EXECUTED BY EACH OF THE PARTIES
HERETO), AND THIS WAIVER SHALL APPLY TO ANY SUBSEQUENT AMENDMENTS, RENEWALS, SUPPLEMENTS
OR MODIFICATIONS TO THIS AGREEMENT. In the event of litigation, this Agreement may be
filed as a written consent to a trial by the court. 

        SECTION
25.     Counterparts.     This Agreement may be executed in one or more counterparts
and by different parties hereto in separate counterparts, each of which when so executed
and delivered shall be deemed an original, but all such counterparts together shall
constitute but one and the same instrument; signature pages may be detached from multiple
separate counterparts and attached to a single counterpart so that all signature pages are
physically attached to the same document. 

[Remainder
of page intentionally left blank] 

15

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

NU SKIN ENTERPRISES,
INC., 

as Pledgor 

By:          /s/ Corey B. Lindley

Name:    Corey B. Lindley

Title:      Executive Vice President and

                Chief Financial Officer

Notice Address 

One Nu Skin Plaza

75 West Center Street

Provo, Utah 84601

Attention: General Counsel

Facsimile: (801) 345-6099 

S-1

STATE STREET BANK AND TRUST
COMPANY OF CALIFORNIA, N.A., 

as Secured Party 

By:         /s/ Stephen Rivero

Name:    Stephen Rivero

Title:      Vice President 

Notice Address 

State Street Bank and
Trus 

Company of California, N.A.

633 West 5th Street, 12th Floor

Los Angeles, California 90071

Attention:    Corporate Trust Department

Facsimile:     (213) 362-7357 

S-2 

SCHEDULE I 

PLEDGED SHARES 

        Attached to and forming a part of the Pledge Agreement dated as of October 12, 2000 between Nu Skin Enterprises, Inc., as Pledgor, and State
Street Bank and Trust Company of California, N.A., as Secured Party.

	Issuer	 	Class of Stock	 	Stock

Certificate Nos.

	 	Par

Value	 	Number of Shares	 	Number of

Shares Issued

and Outstanding

	 	Percentage

Represented by

Pledged Shares	 	Holder of Shares

Not Pledged	 
	 	 	 	 	 	 	 	 
	Nu Skin
 Japan Co., Ltd.	 	Common	 	3A-001	 	¥50,000	 	2,340	 	3,600		65%	 	Pledgor	 

III-A-1

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