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EXHIBIT 4.1  

TARGET CORPORATION

TO

Bank One Trust Company, N.A.  

Trustee  

INDENTURE  

 

  Dated as of August 4, 2000

 

  

Senior Debt Securities  

TARGET CORPORATION  

 

Reconciliation and tie between Trust Indenture Act of 1939 and

Indenture, dated as of August 4, 2000  

	Trust Indenture Act Section
 
	 	Indenture Section
 

	 

§310(a)(1)	 
 	 

609
	 	(a)(2)	 	609
	 	(a)(3)	 	Not Applicable
	 	(a)(4)	 	Not Applicable
	 	(a)(5)	 	609
	 	(b)	 	608, 610
	 	(c)	 	Not Applicable
	§311(a)	 	613
	 	(b)	 	613
	§312(a)	 	701, 702(a)
	 	(b)	 	702(b)
	 	(c)	 	702(c)
	§313(a)	 	703(a)
	 	(b)	 	703(a)
	 	(c)	 	703(a)
	 	(d)	 	703(b)
	§314(a)	 	704, 1011
	 	(b)	 	Not Applicable
	 	(c)(1)	 	102
	 	(c)(2)	 	102
	 	(c)(3)	 	Not Applicable
	 	(d)	 	Not Applicable
	 	(e)	 	102
	§315(a)	 	601
	 	(b)	 	602
	 	(c)	 	601
	 	(d)	 	601
	 	(e)	 	514
	§316(a)	 	101
	 	(a)(1)(A)	 	104(h), 502, 512
	 	(a)(1)(B)	 	104(h), 513
	 	(a)(2)	 	Not Applicable
	 	(b)	 	508
	 	(c)	 	104(h)
	§317(a)(1)	 	503
	 	(a)(2)	 	504
	 	(b)	 	1003
	§318(a)	 	107
	 	(c)	 	107

Note:
This reconciliation and tie shall not, for any purpose, be deemed to be part of the Indenture. 

 

  TABLE OF CONTENTS         

	 
	 	 
	 	Page

	 

Parties	 
 	 

1
	Recitals	 	1
	 

ARTICLE ONE	 
 	 

 
	 

Definitions and Other Provisions of General Application	 
 	 

 
	 

Section 101.	 
 	 

Definitions	 
 	 

1
	 	 	Act	 	2
	 	 	Affiliate	 	2
	 	 	Attributable Debt	 	2
	 	 	Authenticating Agent	 	2
	 	 	Authorized Newspaper	 	2
	 	 	Bearer Security	 	2
	 	 	Board of Directors	 	3
	 	 	Board Resolution	 	3
	 	 	Business Day	 	3
	 	 	Clearstream	 	3
	 	 	Commission	 	3
	 	 	Company	 	3
	 	 	Company Request and Company Order	 	3
	 	 	Consolidated Net Tangible Assets	 	3
	 	 	Corporate Trust Office	 	4
	 	 	corporation	 	4
	 	 	coupon	 	4
	 	 	Debt Securities	 	4
	 	 	Defaulted Interest	 	4
	 	 	Depositary	 	4
	 	 	Designated Currency	 	4
	 	 	Dollar or $	 	4
	 	 	Euro	 	4
	 	 	Euroclear	 	4
	 	 	European Communities	 	4
	 	 	Event of Default	 	4
	 	 	Exchange Rate	 	5
	 	 	Exchange Rate Agent	 	5
	 	 	Exchange Rate Officer's Certificate	 	5
	 	 	Foreign Currency	 	5
	 	 	Funded Debt	 	5
	 	 	GAAP	 	5

	 	 	Global Exchange Agent	 	5
	 	 	Global Exchange Date	 	5
	 	 	Global Security	 	5
	 	 	Government Obligations	 	6
	 	 	Holder	 	6
	 	 	Indebtedness	 	6
	 	 	Indenture	 	6
	 	 	Interest	 	6
	 	 	Interest Payment Date	 	6
	 	 	Investments	 	6
	 	 	Maturity	 	6
	 	 	Mortgage	 	7
	 	 	Officers' Certificate	 	7
	 	 	Operating Property	 	7
	 	 	Opinion of Counsel	 	7
	 	 	Original Issue Discount Security	 	7
	 	 	Outstanding	 	7
	 	 	Paying Agent	 	8
	 	 	Person	 	8
	 	 	Place of Payment	 	8
	 	 	Predecessor Security	 	8
	 	 	Preferred Stock	 	8
	 	 	Redemption Date	 	8
	 	 	Redemption Price	 	8
	 	 	Registered Security	 	8
	 	 	Regular Record Date	 	8
	 	 	Remarketing Entity	 	9
	 	 	Repayment Date	 	9
	 	 	Repayment Price	 	9
	 	 	Responsible Officer	 	9
	 	 	Restricted Subsidiary	 	9
	 	 	Secured Funded Debt	 	9
	 	 	Security Register	 	9
	 	 	Special Record Date	 	9
	 	 	Stated Maturity	 	9
	 	 	Subsidiary	 	9
	 	 	Trust Indenture Act	 	9
	 	 	Trustee	 	9
	 	 	United States	 	10
	 	 	United States Alien	 	10
	 	 	Unrestricted Subsidiary	 	10
	 	 	Voting Stock	 	10
	 	 	Wholly-owned Restricted Subsidiary	 	10

ii

	Section 102.	 	Compliance Certificates and Opinions	 	10
	Section 103.	 	Form of Documents Delivered to Trustee	 	11
	Section 104.	 	Acts of Holders	 	11
	Section 105.	 	Notices, etc., to Trustee and Company	 	14
	Section 106.	 	Notice to Holders; Waiver	 	14
	Section 107.	 	Conflict with Trust Indenture Act	 	15
	Section 108.	 	Effect of Headings and Table of Contents	 	15
	Section 109.	 	Successors and Assigns	 	16
	Section 110.	 	Separability Clause	 	16
	Section 111.	 	Benefits of Indenture	 	16
	Section 112.	 	Governing Law	 	16
	Section 113.	 	Legal Holidays	 	16
	Section 114.	 	Exemption from Individual Liability	 	16
	Section 115.	 	Counterparts	 	17
	 

ARTICLE TWO	 
 	 

 
	Debt Security Forms	 	 
	Section 201.	 	Forms Generally	 	17
	Section 202.	 	Form of Trustee's Certificate of Authentication	 	18
	Section 203.	 	Debt Securities in Global Form	 	18
	 

ARTICLE THREE	 
 	 

 
	The Debt Securities	 	 
	Section 301.	 	Amount Unlimited; Issuance in Series	 	19
	Section 302.	 	Denominations	 	22
	Section 303.	 	Execution, Authentication, Delivery and Dating	 	22
	Section 304.	 	Temporary Debt Securities	 	25
	Section 305.	 	Registration; Registration of Transfer and Exchange	 	27
	Section 306.	 	Mutilated, Destroyed, Lost and Stolen Debt Securities	 	30
	Section 307.	 	Payment of Interest; Interest Rights Preserved	 	31
	Section 308.	 	Persons Deemed Owners	 	33
	Section 309.	 	Cancellation	 	33

iii

	Section 310.	 	Computation of Interest	 	34
	Section 311.	 	Certification by a Person Entitled to Delivery of a Bearer Security	 	34
	Section 312.	 	Judgments	 	34
	 

ARTICLE FOUR	 
 	 

 
	Satisfaction and Discharge	 	 
	Section 401.	 	Satisfaction and Discharge of Indenture	 	35
	Section 402.	 	Application of Trust Money and Government Obligations	 	36
	Section 403.	 	Satisfaction, Discharge and Defeasance of Debt Securities of any Series	 	37
	 

ARTICLE FIVE	 
 	 

 
	Remedies	 	 
	Section 501.	 	Events of Default	 	39
	Section 502.	 	Acceleration of Maturity; Rescission and Annulment	 	40
	Section 503.	 	Collection of Indebtedness and Suits for Enforcement by Trustee	 	41
	Section 504.	 	Trustee May File Proofs of Claim	 	42
	Section 505.	 	Trustee May Enforce Claims without Possession of Debt Securities or Coupons	 	43
	Section 506.	 	Application of Money Collected	 	43
	Section 507.	 	Limitation on Suits	 	44
	Section 508.	 	Unconditional Right of Holders to Receive Principal, Premium and Interest	 	44
	Section 509.	 	Restoration of Rights and Remedies	 	44
	Section 510.	 	Rights and Remedies Cumulative	 	45
	Section 511.	 	Delay or Omission Not Waiver	 	45
	Section 512.	 	Control by Holders of Debt Securities	 	45
	Section 513.	 	Waiver of Past Defaults	 	45
	Section 514.	 	Undertaking for Costs	 	46
	Section 515.	 	Waiver of Stay or Extension Laws	 	46
	 

ARTICLE SIX	 
 	 

 
	The Trustee	 	 
	Section 601.	 	Certain Duties and Responsibilities	 	47

iv

	Section 602.	 	Notice of Default	 	47
	Section 603.	 	Certain Rights of Trustee	 	47
	Section 604.	 	Not Responsible for Recitals or Issuance of Debt Securities	 	48
	Section 605.	 	May Hold Debt Securities or Coupons	 	49
	Section 606.	 	Money Held in Trust	 	49
	Section 607.	 	Compensation and Reimbursement	 	49
	Section 608.	 	Disqualification; Conflicting Interests	 	50
	Section 609.	 	Corporate Trustee Required; Eligibility	 	50
	Section 610.	 	Resignation and Removal; Appointment of Successor	 	50
	Section 611.	 	Acceptance of Appointment by Successor	 	52
	Section 612.	 	Merger, Conversion, Consolidation or Succession to Business	 	53
	Section 613.	 	Preferential Collection of Claims Against Company	 	53
	Section 614.	 	Authenticating Agent	 	54
	 

ARTICLE SEVEN	 
 	 

 
	Holders' Lists and Reports By Trustee and Company	 	 
	Section 701.	 	Company to Furnish Trustee Names and Addresses of Holders	 	55
	Section 702.	 	Preservation of Information; Communications to Holders	 	55
	Section 703.	 	Reports by Trustee	 	56
	Section 704.	 	Reports by Company	 	56
	 

ARTICLE EIGHT	 
 	 

 
	Consolidation, Merger, Conveyance, Transfer or Lease	 	 
	Section 801.	 	Company May Consolidate, etc. Only on Certain Terms	 	56
	Section 802.	 	Successor Corporation Substituted	 	57
	Section 803.	 	Conveyance or Transfer to a Wholly-owned Restricted Subsidiary	 	58
	Section 804.	 	Limitation on Lease of Properties as Entirety	 	58
	 

ARTICLE NINE	 
 	 

 
	Supplemental Indentures	 	 
	Section 901.	 	Supplemental Indentures without Consent of Holders	 	58
	Section 902.	 	Supplemental Indentures with Consent of Holders	 	59
	Section 903.	 	Execution of Supplemental Indentures	 	61

v

	Section 904.	 	Effect of Supplemental Indentures	 	61
	Section 905.	 	Conformity with Trust Indenture Act	 	61
	Section 906.	 	Reference in Debt Securities to Supplemental Indentures	 	61
	 

ARTICLE TEN	 
 	 

 
	Covenants	 	 
	Section 1001.	 	Payment of Principal, Premium and Interest	 	61
	Section 1002.	 	Maintenance of Office or Agency	 	62
	Section 1003.	 	Money for Debt Securities Payments to Be Held in Trust	 	63
	Section 1004.	 	Corporate Existence	 	64
	Section 1005.	 	Maintenance of Properties	 	64
	Section 1006.	 	Payment of Additional Amounts	 	64
	Section 1007.	 	Payment of Taxes and Other Claims	 	65
	Section 1008.	 	Restriction on the Creation of Secured Funded Debt	 	65
	Section 1009.	 	Restriction on Sale and Lease-Back Transactions	 	67
	Section 1010.	 	Restriction on Permitting Unrestricted Subsidiaries to become Restricted Subsidiaries	 	67
	Section 1011.	 	Officer's Certificate as to Default	 	68
	Section 1012.	 	Waiver of Certain Covenants	 	68
	 

ARTICLE ELEVEN	 
 	 

 
	Redemption of Debt Securities	 	 
	Section 1101.	 	Applicability of Article	 	68
	Section 1102.	 	Election to Redeem; Notice to Trustee	 	68
	Section 1103.	 	Selection by Trustee of Debt Securities to be Redeemed	 	69
	Section 1104.	 	Notice of Redemption	 	69
	Section 1105.	 	Deposit of Redemption Price	 	70
	Section 1106.	 	Debt Securities Payable on Redemption Date	 	70
	Section 1107.	 	Debt Securities Redeemed in Part	 	71
	 

ARTICLE TWELVE	 
 	 

 
	Sinking Funds	 	 
	Section 1201.	 	Applicability of Article	 	71

vi

	Section 1202.	 	Satisfaction of Sinking Fund Payments with Debt Securities	 	72
	Section 1203.	 	Redemption of Debt Securities for Sinking Fund	 	72
	 

ARTICLE THIRTEEN	 
 	 

 
	Repayment at the Option of Holders	 	 
	Section 1301.	 	Applicability of Article	 	73
	Section 1302.	 	Repayment of Debt Securities	 	73
	Section 1303.	 	Exercise of Option; Notice	 	73
	Section 1304.	 	Election of Repayment by Remarketing Entities	 	74
	Section 1305.	 	Securities Payable on the Repayment Date	 	74
	 

ARTICLE FOURTEEN	 
 	 

 
	Meetings of Holders of Debt Securities	 	 
	Section 1401.	 	Purposes for Which Meetings May Be Called	 	75
	Section 1402.	 	Call, Notice and Place of Meetings	 	75
	Section 1403.	 	Persons Entitled to Vote at Meetings	 	75
	Section 1404.	 	Quorum; Action	 	76
	Section 1405.	 	Determination of Voting Rights; Conduct and Adjournment of Meetings	 	76
	Section 1406.	 	Counting Votes and Recording Action of Meetings	 	77
	 

ARTICLE FIFTEEN	 
 	 

 
	Defeasance	 	 
	Section 1501.	 	Termination of Company's Obligations	 	78
	Section 1502.	 	Repayment to Company	 	79
	Section 1503.	 	Indemnity for Government Obligations	 	79
	 	 	 	 	 
	Testimonium	 	88
	Signature and Seals	 	88
	Acknowledgements	 	89
	Exhibit A-1	 	A-1
	Exhibit A-2	 	A-2
	Exhibit B	 	B-1

vii

 

          INDENTURE
(the "Indenture") dated as of August 4, 2000, between TARGET CORPORATION, a Minnesota corporation (hereinafter called the "Company"), having its principal place of
business at 777 Nicollet Mall, Minneapolis, Minnesota 55402 and Bank One Trust Company, N.A. (hereinafter called the "Trustee"), having its Corporate Trust Office at 1 Bank One Plaza, Suite
IL1-0126, Chicago, Illinois 60670-0126. 

  RECITALS OF THE COMPANY         

          The Company has duly authorized the execution and delivery of this Indenture to provide for the issuance from time to time of its debentures, notes, bonds and
other evidences of indebtedness (herein called the "Debt Securities"). 

          All
things necessary have been done to make this Indenture a valid agreement of the Company, in accordance with its terms. 

          NOW,
THEREFORE, THIS INDENTURE WITNESSETH: 

          For
and in consideration of the premises and the purchase of the Debt Securities of any series created and issued on or after the date hereof by the Holders thereof, it is mutually
covenanted and agreed, for the benefit of all Holders of such Debt Securities or of any such series, as follows: 

  ARTICLE ONE
  
  Definitions and Other Provisions
  of General Application         

          Section 101.  Definitions.  

          For
all purposes of this Indenture, except as otherwise expressly provided or unless the context otherwise requires: 

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

     (2)  all
other terms used herein which are defined in the Trust Indenture Act or by Commission rule or regulation under the Trust Indenture Act, either directly or by
reference therein, as in force at the date as of which this instrument was executed, except as provided in Section 905, have the meanings assigned to them therein; 

     (3)  all
accounting terms not otherwise defined herein have the meanings assigned to them in accordance with GAAP; and 

     (4)  the words "herein", "hereof" and "hereunder" and other words of similar import refer to this Indenture as a whole and not to any particular Article, Section or
other subdivision. 

          Certain
terms, used principally in Article Six, are defined in that Article. 

          "Act"
when used with respect to any Holder has the meaning specified in Section 104. 

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

          "Attributable
Debt" means, at any date as of which the amount thereof is to be determined, the sum of attributable debt relating to capital leases and operating leases under which
any Person is liable. The amount of attributable debt relating to capital leases is the balance sheet liability amount (capital lease obligations and current portion thereof) in respect of such
capital leases as determined under GAAP. The amount of attributable debt relating to operating leases is the amount of future minimum lease payments under such operating leases required to be
disclosed by GAAP, less any executory costs, discounted using the methodology used to calculate the present value of operating lease payments in the Company's most recent Annual Report to Shareholders
that reflects such a calculation. "Executory costs" mean amounts required to be paid on account of maintenance and repairs, insurance, taxes, assessments, water rates and similar charges. In the case
of any operating lease which is terminable by the lessee upon the payment of a penalty, such net amount shall include the lesser of (a) the rental payments to be paid under such lease until the
first date (after the date of such determination) upon which it may be so terminated plus the then applicable penalty upon such termination, or (b) the rental payments required to be paid
during the remaining term of such lease (assuming such termination provision is not exercised). 

          "Authenticating
Agent" means any Person authorized by the Trustee to act on behalf of the Trustee to authenticate Debt Securities. 

          "Authorized
Newspaper" means a newspaper in an official language of the country of publication or in the English language customarily published on each Business Day, whether or not
published on Saturdays, Sundays or holidays, and of general circulation in the place in connection with which the term is used or in the financial community of such place. Where successive
publications are required to be made in Authorized Newspapers, the successive publications may be made in the same or in different newspapers in the same city meeting the foregoing requirements and in
each case on any Business Day. 

          "Bearer
Security" means any Debt Security established pursuant to Section 201 which is payable to bearer including, without limitation, unless the context otherwise indicates,
a Debt Security in global bearer form. 

2

          "Board of Directors" means either the board of directors of the Company, or the executive or any other committee of that board duly authorized to act in respect hereof. 

          "Board
Resolution" means a copy of a resolution certified by the Secretary or an Assistant Secretary of the Company to have been duly adopted by the Board of Directors and to be in
full force and effect on the date of such certification, and delivered to the Trustee. Where any provision of this Indenture refers to action to be taken pursuant to a Board Resolution (including the
establishment of any series of the Debt Securities and the forms and terms thereof), such action may be taken by any committee of the Board of the Company or any officer or employee of the Company
authorized to take such action by a Board Resolution. 

          "Business
Day", when used with respect to any Place of Payment, means any day which is not a Saturday or Sunday and which is not a legal holiday or a day on which banking
institutions or trust companies in that Place of Payment are authorized or obligated by law or executive order to close. 

          "Clearstream"
means Clearstream Banking S.A. 

          "Commission"
means the Securities and Exchange Commission, as from time to time constituted, created under the Securities Exchange Act of 1934, or if at any time after the execution
of this instrument such Commission is not existing and performing the duties now assigned to it under the Trust Indenture Act, then the body performing such duties on such date. 

          "Company"
means the Person named as the "Company" in the first paragraph of this instrument until a successor Person shall have become such pursuant to the applicable provisions of
this Indenture, and thereafter "Company" shall mean such successor Person. 

          "Company
Request" and "Company Order" mean, respectively, except as otherwise provided in this Indenture, a written request or order signed in the name of the Company by the Chairman
of the Board, a Vice Chairman of the Board, the President or a Vice President (any references to a Vice President of the Company herein shall be deemed to include any Vice President of the Company
whether or not designated by a number or word or words added before or after the title "Vice President"), the Treasurer, an Assistant Treasurer, the Controller, an Assistant Controller, the Secretary
or an Assistant Secretary of the Company or by another officer of the Company duly authorized to sign by a Board Resolution, and delivered to the Trustee. 

          "Consolidated
Net Tangible Assets" means (a) the total amount of assets (less applicable reserves and other properly deductible items) which under GAAP would be included on a
consolidated balance
sheet of the Company and its Restricted Subsidiaries after deducting therefrom (i) all liabilities and liability items, including amounts in respect of obligations or guarantees of obligations
under leases, which under GAAP would be included on such balance sheet, except Funded Debt, capital stock and surplus, surplus reserves and provisions for deferred income taxes, and (ii) all
goodwill, trade names, trademarks, patents, unamortized debt discount and expense and other like intangibles, which in each case under GAAP would be included on such consolidated balance sheet, less
(b) the amount which would be so included on such consolidated balance sheet for Investments (less applicable reserves) (i) made in Unrestricted Subsidiaries, or (ii) made in
corporations while they 

3

were Unrestricted Subsidiaries but which at the time of computation are not Subsidiaries of the Company. 

          "Corporate
Trust Office" means the principal office of the Trustee at which at any particular time its corporate trust business shall be administered, which office at the date of
original execution of this Indenture is located at 1 Bank One Plaza, Suite IL1-0126, Chicago, Illinois 60670-0126, Attention: Corporate Trust Administration, except that, with respect to presentation
of the Debt Securities for payment or registration of transfers or exchanges and the location of the Security Registrar, such term means the office or agency of the Trustee at which at any particular
time its corporate agency business shall be conducted, which at the date of original execution of this Indenture is located at c/o Bank One Trust Company, N.A., 14 Wall Street, 8th Floor,
Window 2, New York, New York 10005. 

          The
term "corporation" includes corporations, associations, companies and business trusts. 

          The
term "coupon" means any interest coupon appertaining to a Bearer Security. 

          "Debt
Securities" has the meaning stated in the first recital of this Indenture and more particularly means any Debt Securities authenticated and delivered under this Indenture. 

          "Defaulted
Interest" has the meaning specified in Section 307. 

          "Depositary"
means, with respect to the Debt Securities of any series issuable or issued in the form of a Global Security, the Person designated as Depositary by the Company pursuant
to Section 301 until a successor Depositary shall have become such pursuant to the applicable provisions of this Indenture, and thereafter "Depositary" shall mean or include each person who is
then a Depositary hereunder, and if at any time there is more than one such Person, "Depositary" as used with respect to the Debt Securities of any such series shall mean the Depositary with respect
to the Debt Securities of that series. 

          "Designated
Currency" has the meaning specified in Section 312. 

          "Dollar"
or "$" means the coin or currency of the United States of America as at the time of payment is legal tender for the payment of public and private debts. 

          "Euro"
means the single currency of the European Monetary Union as defined under EC Regulation 1103/97 adopted under Article 235 of the EU Treaty and under
EC Regulation 974/98 adopted under Article 109l(4) of the EU Treaty or under any successor European legislation from time to time. 

          "Euroclear"
means Morgan Guarantee Trust Company of New York, Brussels Office, as operator of the Euroclear System. 

          "European
Communities" means the European Economic Community, the European Coal and Steel Community and the European Atomic Energy Community. 

          "Event
of Default" has the meaning specified in Section 501. 

4

          "Exchange Rate" shall have the meaning specified as contemplated in Section 301. 

          "Exchange
Rate Agent" shall have the meaning specified as contemplated in Section 301. 

          "Exchange
Rate Officer's Certificate", with respect to any date for the payment of principal of (and premium, if any) and interest on any series of Debt Securities, means a
certificate setting forth the applicable Exchange Rate and the amounts payable in Dollars and Foreign Currencies in respect of the principal of (and premium, if any) and interest on Debt Securities
denominated in Euro, any other composite currency or Foreign Currency, and signed by the Chairman of the Board, a Vice Chairman of the Board, the President, a Vice President, the Treasurer, an
Assistant Treasurer or the Controller of the Company or the Exchange Rate Agent appointed pursuant to Section 301, and delivered to the Trustee. 

          "Foreign
Currency" means a currency issued by the government of any country other than the United States of America. 

          "Funded
Debt" means (i) all Indebtedness which by its terms matures more than 12 months after the time of the computation of the amount thereof or which is extendible
or renewable at the option of the obligor on such Indebtedness to a time more than 12 months after the time of the computation of the amount thereof, (ii) all guarantees, direct or
indirect, of any such Indebtedness or of dividends, other than any guarantee in connection with the sale or discount by the Company or any Restricted Subsidiary of accounts receivable, trade
acceptances and other paper arising in the ordinary course of business, and (iii) in the case of any Subsidiary, all Preferred Stock of such Subsidiary, taken at the greater of its voluntary or
involuntary liquidation price at the time of any calculation hereunder, but exclusive of accrued dividends, if any; provided, however, that in
determining the amount of Funded Debt of the Company or any Subsidiary there shall not be included any amount in respect of obligations under leases, or guarantees of obligations under leases, whether
or not such obligations or guarantees are shown on a balance sheet as liability items. The Company or any Restricted Subsidiary shall be deemed to have assumed Funded Debt secured by any Mortgage upon
any of its property or assets whether or not it has actually done so. 

          "GAAP"
means, as of the date of any determination with respect thereto, generally accepted accounting principles as used by the Financial Accounting Standards Board and/or the
American Institute of Certified Public Accountants, consistently applied and maintained throughout the periods indicated. 

          "Global
Exchange Agent" has the meaning specified in Section 304. 

          "Global
Exchange Date" has the meaning specified in Section 304. 

          "Global
Security" means a Debt Security issued to evidence all or part of a series of Debt Securities in accordance with Section 303. 

5

          "Government Obligations" means, in respect of any series of Debt Securities, securities of (i) the government which issued the currency in which Debt Securities of such series
are denominated and/or in which interest is payable on the Debt Securities of such series or (ii) government agencies backed by the full faith and credit of such government. 

          "Holder",
with respect to a Registered Security, means a Person in whose name such Registered Security is registered in the Security Register and, with respect to a Bearer Security
or a coupon, means the bearer thereof. 

          "Indebtedness"
means (i) all items of indebtedness or liability (except capital and surplus) which in accordance with GAAP would be included in determining total liabilities
as shown on the liability side of a balance sheet as at the date as of which indebtedness is to be determined, (ii) indebtedness secured by any Mortgage existing on property owned subject to
such Mortgage, whether or not the indebtedness secured thereby shall have been assumed, and (iii) guarantees, endorsements (other than for purposes of collection) and other contingent
obligations in respect of, or to purchase or otherwise acquire, indebtedness of others, unless the amount thereof is included in indebtedness under the preceding clause (i) or (ii);  provided, however, that any obligations or guarantees of obligations in respect of lease rentals, whether or not such obligations or guarantees of
obligations would be included as liabilities on a consolidated balance sheet of the Company and its Restricted Subsidiaries, shall not be included in Indebtedness. 

          "Indenture"
means this instrument as originally executed or as it may from time to time be supplemented, amended or restated by or pursuant to one or more indentures supplemental
hereto entered into pursuant to the applicable provisions hereof and, unless the context otherwise requires, shall include the terms of a particular series of Debt Securities established as
contemplated by Section 301. 

          "Interest",
when used with respect to an Original Issue Discount Security which by its terms bears interest only after Maturity, means interest payable after Maturity. 

          "Interest
Payment Date", with respect to any Debt Security, means the Stated Maturity of an installment of interest on such Debt Security. 

          "Investments"
mean and include all investments, whether by acquisition of stock or Indebtedness, or by loan, advance, transfer of property, capital contribution or otherwise, made by
the Company or by any Restricted Subsidiary, and shall include all guarantees, direct or indirect, by the Company or any Restricted Subsidiary of any Indebtedness of an Unrestricted Subsidiary which
by its term matures 12 months or less from the time of computation of the amount thereof to the extent not included as a liability or liability item on the consolidated balance sheet of the
Company and its Restricted Subsidiaries, but shall not include accounts receivable of the Company or of any Restricted Subsidiary arising from the sale of merchandise in the ordinary course of
business. 

          "Maturity",
when used with respect to any Debt Security, means the date on which the principal of such Debt Security becomes due and payable as therein or herein provided, whether at
the Stated Maturity or by declaration of acceleration, call for redemption, repayment at the option of the Holder or otherwise. 

6

          "Mortgage" means and includes any mortgage, pledge, lien, security interest, conditional sale or other title retention agreement or other similar encumbrance. 

          "Officers'
Certificate" means a certificate signed by the Chairman of the Board, a Vice Chairman of the Board, the President or a Vice President, and by the Treasurer, an Assistant
Treasurer, the Controller, an Assistant Controller, the Secretary or an Assistant Secretary of the Company, and delivered to the Trustee. 

          "Operating
Property" means any retail store, distribution center or other property related to the general retail business of the Company or any Subsidiary, parking facilities, and
any equipment located at
or comprising a part of any such property, which has a net book value on the date as of which the determination is being made in excess of .35% of Consolidated Net Tangible Assets and which has been
owned and operated by the Company or any Subsidiary for more than 90 days; provided, however, that any such property or equipment (not
theretofore owned by the Company or a Subsidiary) owned and operated by a corporation which becomes a Subsidiary after the execution and delivery of this Indenture as originally executed shall not
constitute Operating Property unless owned and operated by such corporation for more than 90 days after it becomes a Subsidiary. 

          "Opinion
of Counsel" means a written opinion of counsel, who may (except as otherwise expressly provided in this Indenture) be an employee of or counsel for the Company, or who may
be other counsel acceptable to the Trustee, which is delivered to the Trustee. 

          "Original
Issue Discount Security" means any Debt Security which provides for an amount less than the principal amount thereof to be due and payable upon a declaration of
acceleration of the Maturity thereof pursuant to Section 502. 

          "Outstanding",
when used with respect to Debt Securities means, as of the date of determination, all Debt Securities theretofore authenticated and delivered under this Indenture,  except:

     (i)   Debt
Securities theretofore cancelled by the Trustee or delivered to the Trustee for cancellation; 

     (ii)  Debt
Securities or portions thereof for whose payment or redemption money or Government Obligations in the necessary amount has been theretofore deposited with
the Trustee or any Paying Agent (other than the Company) in trust or set aside and segregated in trust by the Company (if the Company shall act as its own Paying Agent) for the Holders of such Debt
Securities and any coupons appertaining thereto; provided, however, that if such Debt Securities are to be redeemed, notice of such redemption has been
duly given pursuant to this Indenture or provision therefor satisfactory to the Trustee has been made; and 

     (iii)  Debt
Securities in exchange for or in lieu of which other Debt Securities have been authenticated and delivered, or which have been paid, pursuant to this
Indenture; 

provided, however, that in determining whether the Holders of the requisite principal amount of Debt Securities Outstanding have given any request,
demand, authorization, direction, notice, consent or 

7

waiver hereunder, Debt Securities owned by the Company or any other obligor upon the Debt Securities or any Affiliate of the Company or of such other obligor shall be disregarded and deemed not to be
Outstanding, except that, in determining whether the Trustee shall be protected in relying upon such request, demand, authorization, direction, notice, consent or waiver, only Debt Securities which
the Trustee knows to be so owned shall be so disregarded. Debt Securities so owned which have been pledged in good faith may be regarded as Outstanding if the pledgee establishes to the satisfaction
of the Trustee the pledgee's right so to act with respect to such Debt Securities and that the pledgee is not the Company or any other obligor upon the Debt Securities or any Affiliate of the Company
or of such other obligor. 

          "Paying
Agent" means any Person authorized by the Company to pay the principal of (and premium, if any) or interest on any Debt Securities on behalf of the Company. 

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

          "Place
of Payment", when used with respect to the Debt Securities of any series means any place where the principal of (and premium, if any) and interest on the Debt Securities of
that series are payable as specified as contemplated by Section 301. 

          "Predecessor
Security" of any particular Debt Security means every previous Debt Security evidencing all or a portion of the same debt as that evidenced by such particular Debt
Security; and, for the purposes of this definition, any Debt Security authenticated and delivered under Section 306 in lieu of a lost, destroyed or stolen Debt Security shall be deemed to
evidence the same debt as the lost, destroyed or stolen Debt Security. 

          "Preferred
Stock", as applied to the capital stock of any corporation, means stock of any class or classes (however designated) which is preferred as to the payment of dividends, or
as to the distribution of assets on any voluntary or involuntary liquidation or dissolution of such corporation, over shares of stock of any other class of such corporation. 

          "Redemption
Date", when used with respect to any Debt Security to be redeemed, means the date fixed for such redemption by or pursuant to this Indenture. 

          "Redemption
Price", when used with respect to any Debt Security to be redeemed, means the price at which it is to be redeemed pursuant to this Indenture. 

          "Registered
Security" means any Debt Security in the form of Registered Securities established pursuant to Section 201 which is registered in the Security Register. 

          "Regular
Record Date" for the interest payable on any Interest Payment Date on the Registered Securities of any series means the date specified for that purpose as contemplated by
Section 301. 

8

 

          "Remarketing
Entity", when used with respect to Debt Securities of any series which are repayable at the option of the Holders thereof before their Stated Maturity, means any person
designated by the Company to purchase any such Debt Securities. 

          "Repayment
Date", when used with respect to any Debt Security to be repaid upon exercise of an option for repayment by the Holder, means the date fixed for such repayment pursuant to
this Indenture. 

          "Repayment
Price", when used with respect to any Debt Security to be repaid upon exercise of an option for repayment by the Holder, means the price at which it is to be repaid
pursuant to this Indenture. 

          "Responsible
Officer" when used with respect to the Trustee, means any officer of the Trustee assigned by it to administer its corporate trust matters. 

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

          "Secured
Funded Debt" means any Funded Debt which is secured by a Mortgage upon any assets of the Company or a Restricted Subsidiary, including in such assets, without limitation,
shares of stock or Indebtedness of any Subsidiary owned by the Company or a Restricted Subsidiary. 

          "Security
Register" and "Security Registrar" have the respective meanings specified in Section 305. 

          "Special
Record Date" for the payment of any Defaulted Interest means a date fixed by the Trustee pursuant to Section 307. 

          "Stated
Maturity", when used with respect to any Debt Security or any installment of interest thereon, means the date specified in such Debt Security or a coupon representing such
installment of interest as the fixed date on which the principal of such Debt Security or such installment is due and payable. 

          "Subsidiary"
means any corporation more than 50% of the outstanding shares of Voting Stock, except for directors' qualifying shares, of which shall at the time be owned, directly or
indirectly, by the Company or by one or more of the Subsidiaries, or by the Company and one or more other Subsidiaries. 

          "Trust
Indenture Act" means the Trust Indenture Act of 1939 as in force at the date as of which this instrument was executed, except as provided in Section 905. 

          "Trustee"
means the Person named as the "Trustee" in the first paragraph of this instrument until a successor Trustee shall have become such pursuant to the applicable provisions of
this Indenture, and thereafter "Trustee" shall mean or include each Person who is then a Trustee hereunder, and if at any time there is more than one such Person, "Trustee" as used with respect to the
Debt Securities of any series shall mean the Trustee with respect to Debt Securities of that series. 

9

          "United States" means the United States of America (including the District of Columbia) and its possessions. 

          "United
States Alien" means any Person who, for United States Federal income tax purposes, is a foreign corporation, a non-resident alien individual, a
non-resident alien fiduciary of a foreign estate or trust, or a foreign partnership one or more of the members of which is, for United States Federal income tax purposes, a foreign
corporation, a non-resident alien individual or a non-resident alien fiduciary of a foreign estate or trust. 

          "Unrestricted
Subsidiary" means (a) (i) Eighth Street Development Company, Target Capital Corporation, Target Receivables Corporation and The Associated Merchandising
Corporation, (ii) any Subsidiary created or acquired after the date hereof the primary business of which consists of financing operations
in connection with leasing and conditional sales transactions on behalf of the Company and its Subsidiaries, and/or purchasing accounts receivable, and/or making loans secured by accounts receivable
or inventory, or which is otherwise primarily engaged in the business of a finance company, and (iii) any other Subsidiary which, in accordance with the provisions of this Indenture, has been
designated by Board Resolution as an Unrestricted Subsidiary, in each case unless and until any of the Subsidiaries referred to in the foregoing clauses (i), (ii) and (iii) shall, in
accordance with the provisions of this Indenture, be designated by Board Resolution as a Restricted Subsidiary; and (b) any Subsidiary a majority of the Voting Stock of which shall at the time
be owned directly or indirectly by one or more Unrestricted Subsidiaries. 

          "Voting
Stock", as applied to the stock (or the equivalent thereof) of any corporation, means stock (or the equivalent thereof) of any class or classes, however designated, entitled
in the ordinary course to vote in an election of directors of such corporation, other than stock (or such equivalent) having such power only by reason of the happening of a contingency. 

          "Wholly-owned
Restricted Subsidiary" means any Restricted Subsidiary all the outstanding capital stock of which, other than directors' qualifying shares, is owned by the Company and
its other Wholly-owned Restricted Subsidiaries. 

          Section 102.  Compliance Certificates and Opinions.  

          Upon
any application or request by the Company to the Trustee to take any action under any provision of this Indenture, the Company shall furnish to the Trustee, if so requested by
the Trustee, an Officers' Certificate stating that all conditions precedent, if any, provided for in this Indenture relating to the proposed action have been complied with and an Opinion of Counsel
stating that in the opinion of such counsel all such conditions precedent, if any, have been complied with, except that in the case of any such application or request as to which the furnishing of
such documents is specifically required by any provision of this Indenture relating to such particular application or request, no additional certificate or opinion need be furnished. 

10

          Every certificate or opinion with respect to compliance with a condition or covenant provided for in this Indenture shall include: 

     (1)  a
statement that each individual signing such certificate or opinion has read such covenant or condition and the definitions herein relating thereto; 

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

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

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

          Section 103.  Form of Documents Delivered to Trustee.  

          In
any case where several matters are required to be certified by, or covered by an opinion of, any specified Person, it is not necessary that all such matters be certified by, or
covered by the opinion of, only one such Person, or that they be so certified or covered by only one document, but one such Person may certify or give an opinion with respect to some matters and one
or more other such Persons as to other matters, and any such Person may certify or give an opinion as to such matters in one or several documents. 

          Any
certificate or opinion of an officer of the Company may be based, insofar as it relates to legal matters, upon a certificate or opinion of, or representations by, counsel, unless
such officer knows, or in the exercise of reasonable care should know, that the certificate or opinion or representations with respect to the matters upon which his or her certificate or opinion is
based is erroneous. Any such certificate or Opinion of Counsel may be based, insofar as it relates to factual matters, upon a certificate or opinion of, or representations by, an officer or officers
of the Company stating that the information with respect to such factual matters is in the possession of the Company, unless such
counsel knows, or in the exercise of reasonable care should know, that the certificate or opinions or representations with respect to such matters is erroneous. 

          Where
any Person is required to make, give or execute two or more applications, requests, consents, certificates, statements, opinions or other instruments under this Indenture, they
may, but need not, be consolidated and form one instrument. 

          Section 104.  Acts of Holders.  

          (a)  Any
request, demand, authorization, direction, notice, consent, waiver or other action provided by this Indenture to be given or taken by Holders may be embodied
in and evidenced by one or more instruments of substantially similar tenor signed by such Holders in person or by an agent duly appointed in writing. If Debt Securities of a series are issuable in
whole or in part as Bearer Securities, any request, demand, authorization, direction, notice, consent, waiver or other action 

11

provided by this Indenture to be given or taken by Holders may, alternatively, be embodied in and evidenced by the record of Holders of Debt Securities voting in favor thereof, either in person or by
proxies duly appointed in writing, at any meeting of Holders of Debt Securities duly called and held in accordance with the provisions of Article Fourteen, or a combination of such instruments and any
such record. Except as herein otherwise expressly provided, such action shall become effective when such instrument or instruments or record or both are delivered to the Trustee, and, where it is
hereby expressly required, to the Company. Such instrument or instruments and any such record (and the action embodied therein and evidenced thereby) are herein sometimes referred to as the "Act" of
the Holders signing such instrument or instruments and so voting at any such meeting. Proof of execution of any such instrument or of a writing appointing any such agent, or the holding by any Person
of a Debt Security, shall be sufficient for any purpose of this Indenture and (subject to Section 601) conclusive in favor of the Trustee and the Company, if made in the manner provided in this
Section. The record of any meeting of Holders of Debt Securities shall be proved in the manner provided in Section 1406. 

          (b)  The
fact and date of the execution by any Person of any such instrument or writing may be proved in any manner which the Trustee deems sufficient. 

          (c)  The
ownership of Registered Securities shall be proved by the Security Register. 

          (d)  The
principal amount and serial numbers of Bearer Securities held by any Person, and the date of holding the same, may be proved by the production of such Bearer
Securities or by a certificate executed, as depositary, by any trust company, bank, banker or other depositary, wherever situated, if such certificate shall be deemed by the Trustee to be
satisfactory, showing that at the date therein mentioned such Person had on deposit with such depositary, or exhibited to it, the Bearer Securities in the amount and with the serial numbers therein
described; or such facts may be proved by the certificate or affidavit of the Person holding such Bearer Securities, if such certificate or affidavit is deemed by the Trustee to be satisfactory. The
Trustee and the Company may assume that such ownership of any Bearer Security continues until (1) another certificate or affidavit bearing a later date issued in respect of the same Bearer
Security is produced, or (2) such Bearer Security is produced to the Trustee by some other person, or (3) such Bearer Security is surrendered in exchange for a Registered Security, or
(4) such Bearer Security is no longer Outstanding. 

          (e)  The
fact and date of execution of any such instrument or writing, the authority of the Person executing the same and the principal amount and serial numbers of
Bearer Securities held by the Person so executing such instrument or writing and the date of holding the same may also be proved in any other manner which the Trustee deems sufficient; and the Trustee
may in any instance require further proof with respect to any of the matters referred to in this Section. 

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

12

          (g)  For purposes of determining the principal amount of Outstanding Debt Securities of any series the Holders of which are required, requested or permitted to give
any request, demand, authorization, direction, notice, consent, waiver or take any other Act under this Indenture, (i) each Original Issue Discount Security shall be deemed to have the
principal amount determined by the Trustee that could be declared to be due and payable pursuant to the terms of such Original Issue Discount Security as of the date there is delivered to the Trustee
and, where it is hereby expressly required, to the Company,
such Act by Holders of the required aggregate principal amount of the Outstanding Debt Securities of such series and (ii) each Debt Security denominated in a Foreign Currency or composite
currency shall be deemed to have the principal amount determined by the Exchange Rate Agent by converting the principal amount of such Debt Security in the currency in which such Debt Security is
denominated into Dollars at the Exchange Rate as of the date such Act is delivered to the Trustee and, where it is hereby expressly required, to the Company, by Holders of the required aggregate
principal amount of the Outstanding Debt Securities of such series. 

          (h)  The
Company may set any day as a record date for the purpose of determining the Holders of Outstanding Debt Securities of any series entitled to give, make or
take any request, demand, authorization, direction, notice, consent, waiver or other action provided or permitted by this Indenture to be given, made or taken by Holders of Debt Securities of such
series, provided that the Company may not set a record date for, and the provisions of this paragraph shall not apply with respect to, the giving or
making of any notice, declaration, request or direction referred to in the next paragraph. If any record date is set pursuant to this paragraph, the Holders of Outstanding Debt Securities of the
relevant series on such record date, and no other Holders, shall be entitled to take the relevant action, whether or not such Holders remain Holders after such record date;  provided that no such action
shall be effective hereunder unless taken on or prior to the applicable Expiration Date (as defined below) by Holders of
the requisite principal amount of Outstanding Debt Securities of such series on such record date. Nothing in this paragraph shall be construed to prevent the Company from setting a new record date for
any action for which a record date has previously been set pursuant to this paragraph (whereupon the record date previously set shall automatically and with no action by any Person be cancelled and of
no effect), and nothing in this paragraph shall be construed to render ineffective any action taken by Holders of the requisite principal amount of Outstanding Debt Securities of the relevant series
on the date such action is taken. Promptly after any record date is set pursuant to this paragraph, the Company, at its own expense, shall cause notice of such record date, the proposed action by
Holders and the applicable Expiration Date to be given to the Trustee in writing and to each Holder of Debt Securities of the relevant series in the manner set forth in Section 106. 

          The
Trustee may set any day as a record date for the purpose of determining the Holders of Outstanding Debt Securities of any series entitled to join in the giving or making of
(i) any notice of an Event of Default, (ii) any declaration of acceleration referred to in Section 502, (iii) any request to institute proceedings referred to in
Section 507(2), or (iv) any direction referred to in Section 512, in each case with respect to Debt Securities of such series. If any record date is set pursuant to this
paragraph, the Holders of Outstanding Debt Securities of such series on such record date, and no other Holders, shall be entitled to join in such notice, declaration, request or direction, whether or
not such Holders remain Holders after such record date; provided that no such action shall be effective hereunder unless taken on or prior to the
applicable Expiration Date by Holders of the requisite principal amount of Outstanding Debt Securities of such series on such record date. 

13

Nothing in this paragraph shall be construed to prevent the Trustee from setting a new record date for any action for which a record date has previously been set pursuant to this paragraph (whereupon
the record date previously set shall automatically and with no action by any Person be cancelled and of no effect), and nothing in this paragraph shall be construed to render ineffective any action
taken by Holders of the requisite principal amount of Outstanding Debt Securities of the relevant series on the date such action is taken. Promptly after any record date is set pursuant to this
paragraph, the Trustee, at the Company's expense, shall cause notice of such record date, the proposed action by Holders and the applicable Expiration Date to be given to the Company in writing and to
each Holder of Debt Securities of the relevant series in the manner set forth in Section 106. 

          With
respect to any record date set pursuant to this Section, the party hereto which sets such record dates may designate any day as the "Expiration Date" and from time to time may
change the Expiration Date to any earlier or later day; provided that no such change shall be effective unless notice of the proposed new Expiration
Date is given to the other party hereto in writing, and to each Holder of Debt Securities of the relevant series in the manner set forth in Section 106, on or prior to the existing Expiration
Date. If an Expiration Date is not designated with respect to any record date set pursuant to this Section, the party hereto which set such record date shall be deemed to have initially designated the
180th day after such record date as the Expiration Date with respect thereto, subject to its right to change the Expiration Date as provided in this paragraph. 

          Section 105.  Notices, etc., to Trustee and Company.  

          Any
request, demand, authorization, direction, notice, consent, waiver or other Act of Holders or other document provided or permitted by this Indenture to be made upon, given or
furnished to, or filed with, 

     (1)  the
Trustee by any Holder or by the Company shall be sufficient for every purpose hereunder (unless otherwise herein expressly provided), if in writing and sent by
certified mail or by courier to the Trustee at its Corporate Trust Office, or 

     (2)  the
Company by the Trustee or by any Holder shall be sufficient for every purpose hereunder (unless otherwise herein expressly provided) if in writing and sent by
certified mail or by courier to the Company addressed to the attention of its Secretary at the address of its principal office specified in the first paragraph of this instrument or at any other
address previously furnished in writing to the Trustee by the Company. 

          Section 106.  Notice to Holders; Waiver.  

          Except
as otherwise expressly provided herein, where this Indenture provides for notice to Holders of any event, (1) such notice shall be sufficiently given to Holders of
Registered Securities if in writing and mailed, first-class postage prepaid, to each Holder of a Registered Security affected by such event, at such Holder's address as it appears in the Security
Register, not later than the latest date, and not earlier than the earliest date, prescribed for the giving of such notice; and (2) such notice shall be sufficiently given to Holders of Bearer
Securities by publication thereof in an Authorized Newspaper in The City of New York and, if the Debt Securities of such series are then listed on The 

14

International Stock Exchange of the United Kingdom and the Republic of Ireland and such stock exchange shall so require, in London, and, if the Debt Securities of such series are then listed on the
Luxembourg Stock Exchange and such stock exchange shall so require, in Luxembourg and, if the Debt Securities of such series are then listed on any other stock exchange outside the United States and
such stock exchange shall so require, in any other required city outside the United States or, if not practicable, in Europe on a Business Day at least twice, the first such publication to be not
later than the latest date and not earlier than the earliest date prescribed for the giving of such notice. 

          In
case, by reason of the suspension of or irregularities in regular mail service or for any other reason, it shall be impossible or impracticable to mail notice of any event to
Holders of Registered Securities when said notice is required to be given pursuant to any provision of this Indenture or of the Debt Securities, then any manner of giving such notice as shall be
satisfactory to the Trustee shall be deemed to be a sufficient giving of such notice. In any case where notice to Holders of Registered Securities is to be given by mail, neither the failure to mail
such notice, nor any defect in any notice so mailed, to any particular Holder of a Registered Security shall affect the sufficiency of such notice with respect to other Holders of Registered
Securities or the sufficiency of any notice by publication to Holders of Bearer Securities given as provided above. 

          In
case, by reason of the suspension of publication of any Authorized Newspaper, or by reason of any other cause, it shall be impossible or impracticable to make publication of any
notice to Holders of Bearer Securities as provided above, then such method of publication or notification as shall be made with the approval of the Trustee shall constitute a sufficient publication of
such notice. Neither failure to give notice by publication to Holders of Bearer Securities as provided above, nor any defect in any notice so published, shall affect the sufficiency of any notice
mailed to Holders of Registered Securities as provided above. 

          Where
this Indenture provides for notice in any manner, such notice may be waived in writing by the Person entitled to receive such notice, either before or after the event, and such
waiver shall be the equivalent of such notice. Waivers of notice by Holders shall be filed with the Trustee, but such filing shall not be a condition precedent to the validity of any action taken in
reliance upon such waiver. 

          Any
request, demand, authorization, direction, notice, consent, election, waiver or other Act required or permitted under this Indenture shall be in the English language, except that
any published notice may be in an official language of the country of publication. 

          Section 107.  Conflict with Trust Indenture Act.  

          If
any provision hereof limits, qualifies or conflicts with another provision hereof which is required to be included in this Indenture by any of the provisions of the Trust
Indenture Act, such required provision shall control. 

          Section 108.  Effect of Headings and Table of Contents.  

          The
Article and Section headings herein and the Table of Contents are for convenience only and shall not affect the construction hereof. 

15

          Section 109.  Successors and Assigns.  

          All
covenants and agreements in this Indenture by the Company shall bind its successors and assigns, whether so expressed or not. 

          Section 110.  Separability Clause.  

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

          Section 111.  Benefits of Indenture.  

          Nothing
in this Indenture or in the Debt Securities or any coupons, express or implied, shall give to any Person, other than the parties hereto and their successors hereunder, any
Paying Agent and the Holders, any benefit or any legal or equitable right, remedy or claim under this Indenture. 

          Section 112.  Governing Law.  

          This
Indenture and the Debt Securities and any coupons shall be governed by and construed in accordance with the laws of the State of Minnesota. 

          Section 113.  Legal Holidays.  

          In
any case where any Interest Payment Date, Redemption Date, Repayment Date or Stated Maturity of any Debt Security shall not be a Business Day at any Place of Payment, then
(notwithstanding any other provision of this Indenture or of the Debt Securities or any coupons) payment of interest or principal (and premium, if any) need not be made at such Place of Payment on
such date, but may be made on the next succeeding Business Day at such Place of Payment with the same force and effect as if made on the Interest Payment Date, Redemption Date, Repayment Date or at
the Stated Maturity, and no interest shall accrue on the amount so payable for the period from and after such Interest Payment Date, Redemption Date, Repayment Date or Stated Maturity, as the case may
be. 

          Section 114.  Exemption from Individual Liability.  

          No
recourse under or upon any obligation, covenant or agreement of this Indenture, or of any Debt Security or any coupon, or for any claim based thereon or otherwise in respect
thereof, shall be had against any incorporator, stockholder, officer or director, as such, past, present or future, of the Company or of any successor corporation, either directly or through the
Company, whether by virtue of any constitution, statute or rule of law, or by the enforcement of any assessment or penalty or otherwise; it being expressly understood that this Indenture and the
obligations issued hereunder are solely corporate obligations of the Company, and that no such personal liability whatever shall attach to, or is or shall be incurred by, the incorporators,
stockholders, officers or directors, as such, of the Company or of any successor corporation, or any of them, because of the creation of the indebtedness 

16

hereby authorized, or under or by reason of the obligations, covenants or agreements contained in this Indenture or in any of the Debt Securities or any coupon or implied therefrom; and that any and
all such personal liability, either at common law or in equity or by constitution or statute, of, and any and all such rights and claims against, every such incorporator, stockholder, officer or
director, as such, because of the creation of the indebtedness hereby authorized, or under or by reason of the obligations, covenants or agreements contained in this Indenture or in any of the Debt
Securities or any coupon or implied therefrom, are hereby expressly waived and released as a condition of, and as a consideration for, the execution of this Indenture and the issue of such Debt
Securities. 

          Section 115.  Counterparts.  

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

  ARTICLE TWO
  
  Debt Security Forms         

          Section 201.  Forms Generally.  

          The
Registered Securities, if any, and the Bearer Securities and related coupons, if any, of each series shall be in substantially the form (including temporary or permanent global
form) as shall be established in or pursuant to a Board Resolution or in one or more indentures supplemental hereto, in each case with such appropriate insertions, omissions, substitutions and other
variations as are required or permitted by this Indenture, and may have such letters, numbers or other marks of identification and such legends or endorsements placed thereon, as may be required to
comply with the rules of any securities exchange, or as may, consistently herewith, be determined by the officers executing such Debt Securities or coupons, as evidenced by their signatures on the
Debt Securities or coupons. If the form of Debt Securities of any series or coupons (including any such Global Security) is established by action taken pursuant to a Board Resolution, a copy of an
appropriate record of such action shall be certified by the Secretary or an Assistant Secretary of the Company and delivered to the Trustee at or prior to the delivery of the Company Order
contemplated by Section 303 for the authentication and delivery of such Debt Securities or coupons. 

          Unless
otherwise specified as contemplated by Section 301, Debt Securities in bearer form other than Debt Securities in temporary or permanent global form shall have coupons
attached. 

          The
definitive Debt Securities and coupons, if any, shall be printed, lithographed or engraved on steel engraved borders or may be produced in any other manner, all as determined by
the officers executing such Debt Securities, as evidenced by the execution of such Debt Securities and coupons. 

17

          Section 202.  Form of Trustee's Certificate of Authentication.  

          This
is one of the Debt Securities, of the series designated herein, described in the within-mentioned Indenture. 

	 	 	 	,
	 	 	BANK ONE TRUST COMPANY, N.A.
	 	 	as Trustee
	 

 	 
 	 

By	 

 
	 	 	 	

	 	 	Authorized Officer

          Section 203.  Debt Securities in Global Form.  

          If
Debt Securities of a series are issuable in whole or in part in global form, as specified as contemplated by Section 301, then, notwithstanding clause (10) of
Section 301 and the provisions of Section 302, such Global Security shall represent such of the outstanding Debt Securities of such series as shall be specified therein and may provide
that it shall represent the aggregate amount of Outstanding Debt Securities from time to time endorsed thereon and that the aggregate amount of Outstanding Debt Securities represented thereby may from
time to time be reduced to reflect exchanges. Any endorsement of a Global Security to reflect the amount, or any increase or decrease in the amount, of Outstanding Debt Securities represented thereby
shall be made in such manner and upon instructions given by such Person or Persons as shall be specified therein or in the Company Order to be delivered to the Trustee pursuant to Section 303
or Section 304. 

          The
provisions of the last sentence of Section 303(g) shall apply to any Debt Securities represented by a Debt Security in global form if such Debt Security was never issued
and sold by the Company and the Company delivers to the Trustee the Debt Security in global form together with written instructions (which need not comply with Section 102 and need not be
accompanied by an Opinion of Counsel) with respect to the reduction in the principal amount of Debt Securities represented thereby, together with the written statement contemplated by the last
sentence of Section 303(g). 

          Global
Securities may be issued in either registered or bearer form and in permanent form or, in the case of Bearer Securities, either temporary or permanent form. 

18

 

  ARTICLE THREE
  
  The Debt Securities         

          Section 301.  Amount Unlimited; Issuance in Series.  

          The
aggregate principal amount of Debt Securities which may be authenticated and delivered under this Indenture is unlimited. 

          The
Debt Securities may be issued in one or more series. There shall be established in or pursuant to a Board Resolution, and set forth in an Officers' Certificate, or established in
one or more indentures supplemental hereto, prior to the issuance of Debt Securities of any series: 

     (1)  the
title of the Debt Securities of the series (which shall distinguish the Debt Securities of the series from all other Debt Securities); 

     (2)  the
limit, if any, upon the aggregate principal amount of the Debt Securities of the series which may be authenticated and delivered under this Indenture (except
for Debt Securities authenticated and delivered upon registration of transfer of, or in exchange for, or in lieu of, other Debt Securities of the series pursuant to Section 304, 305, 306, 906,
1107 or 1303 and except for any Debt Securities which, pursuant to Section 303, are deemed never to have been authenticated and delivered hereunder); 

     (3)  the
date or dates on which the principal and premium, if any, of the Debt Securities of the series are payable; 

     (4)  the
rate or rates, if any, at which the Debt Securities of the series shall bear interest, or the method or methods by which such rate or rates may be determined,
the date or dates from which such interest shall accrue, the Interest Payment Dates on which such interest shall be payable, the Regular Record Date for the interest payable on any Registered Security
on any Interest Payment Date and the circumstances, if any, in which the Company may defer interest payments; 

     (5)  the
place or places where, subject to the provisions of Section 1002, the principal of (and premium, if any) and interest on Debt Securities of the series
shall be payable, any Registered Securities of the series may be surrendered for registration of transfer, Debt Securities of the series may be surrendered for exchange and notices and demands to or
upon the Company in respect of the Debt Securities of the series and this Indenture may be served and where notices to Holders pursuant to Section 106 will be published; 

     (6)  if
applicable, the period or periods within which or the date or dates on which, the price or prices at which and the terms and conditions upon which Debt
Securities of the series may be redeemed, in whole or in part, at the option of the Company; 

     (7)  the
obligation, if any, of the Company to redeem, repay or purchase Debt Securities of the series pursuant to any sinking fund or analogous provisions or at the
option of 

19

a Holder thereof and the period or periods within which, the price or prices at which and the terms and conditions upon which Debt Securities of the series shall be redeemed, repaid or purchased, in
whole or in part, pursuant to such obligation; 

     (8)  whether
Debt Securities of the series are to be issuable as Registered Securities, Bearer Securities or both, whether Debt Securities of the series are to be
issuable with or without coupons or both and, in the case of Bearer Securities, the date as of which such Bearer Securities shall be dated if other than the date of original issuance of the first Debt
Security of such series of like tenor and term to be issued; 

     (9)  whether
the Debt Securities of the series shall be issued in whole or in part in the form of a Global Security or Securities and, in such case, the Depositary and
Global Exchange Agent for such Global Security or Securities, whether such global form shall be permanent or temporary and, if applicable, the Global Exchange Date; 

     (10) if
Debt Securities of the series are to be issuable initially in the form of a temporary Global Security, the circumstances under which the temporary Global
Security can be exchanged for definitive Debt Securities and whether the definitive Debt Securities will be Registered and/or Bearer Securities and will be in global form and whether interest in
respect of any portion of such Global Security payable in respect of an Interest Payment Date prior to the Global Exchange Date shall be paid to any clearing organization with respect to a portion of
such Global Security held for its account and, in such event, the terms and conditions (including any certification requirements) upon which any such interest payment received by a clearing
organization will be credited to the Persons entitled to interest payable on such Interest Payment Date if other than as provided in this Article Three; 

     (11) whether,
and under what conditions, additional amounts will be payable to Holders of Debt Securities of the series pursuant to Section 1006; 

     (12) the
denominations in which any Registered Securities of the series shall be issuable, if other than denominations of $1,000 and any integral multiple thereof, and
the denominations in which any Bearer Securities of such series shall be issuable, if other than the denomination of $5,000; 

     (13) if
other than the principal amount thereof, the portion of the principal amount of Debt Securities of the series which shall be payable upon declaration of
acceleration of the Maturity thereof pursuant to Section 502; 

     (14) the
currency or currencies of denomination of the Debt Securities of any series, which may be in Dollars, any Foreign Currency or any composite currency, including
but not limited to the Euro, and, if any such currency of denomination is a composite currency other than the Euro, the agency or organization, if any, responsible for overseeing such composite
currency; 

     (15) the
currency or currencies in which payment of the principal of (and premium, if any) and interest on the Debt Securities will be made, any other currency or
currencies in 

20

which payment of the principal of (and premium, if any) or the interest on Registered Securities, at the election of each of the Holders thereof, may also be payable and the periods within which and
the terms and conditions upon which such election is to be made, and the Exchange Rate and Exchange Rate Agent; 

     (16) if
the amount of payments of principal of (and premium, if any) or interest on the Debt Securities of the series may be determined with reference to an index, the
manner in which such amounts shall be determined; 

     (17) if
payments of principal of (and premium, if any) or interest on the Debt Securities of the series are to be made in a Foreign Currency other than the currency in
which such Debt Securities are denominated, the manner in which the Exchange Rate with respect to such payments shall be determined; 

     (18) any
Events of Default with respect to Debt Securities of such series, if not set forth herein; 

     (19) any
other covenant or warranty included for the benefit of the Debt Securities of the series in addition to (and not inconsistent with) those set forth herein for
the benefit of Debt Securities of all series, or any other covenant or warranty included for the benefit of Debt Securities of the series in lieu of any covenant or warranty set forth herein for the
benefit of Debt Securities of all series, or any provision that any covenant or warranty set forth herein for the benefit of Debt Securities of all series shall not be for the benefit of Debt
Securities of such series, or any combination of such covenants, warranties or provisions and the applicability, if any, of the provisions of Section 1012 to such covenants and warranties; 

     (20) the
terms and conditions, if any, pursuant to which the Company's obligations under this Indenture may be terminated through the deposit of money or Government
Obligations as provided in Articles Four and Fifteen; 

     (21) the
Person or Persons who shall be Security Registrar for the Debt Securities of such series if other than the Trustee, and the place or places where the Security
Register for such series shall be maintained and the Person or Persons who will be the initial Paying Agent or Agents, if other than the Trustee; and 

     (22) any
other terms of the series (which terms shall not be inconsistent with the provisions of this Indenture). 

          All
Debt Securities of any one series and the coupons appertaining to Bearer Securities of such series, if any, shall be substantially identical except, in the case of Registered
Securities, as to denomination and except as may otherwise be provided in or pursuant to such Board Resolution and set forth in such Officers' Certificate or in any such indenture supplemental hereto. 

          Debt
Securities of any particular series may be issued at various times, with different dates on which the principal or any installment of principal is payable, with different rates
of interest, if any, or different methods by which rates of interest may be determined, with different dates on which 

21

such interest may be payable and with different Redemption or Repayment Dates and may be denominated in different currencies or payable in different currencies. 

          If
any of the terms of a series of Debt Securities are established by action taken pursuant to a Board Resolution, a copy of an appropriate record of such action shall be certified
by the Secretary or an Assistant Secretary of the Company and delivered to the Trustee at or prior to the delivery of the Officers' Certificate setting forth the terms of the series. 

          Section 302.  Denominations.  

          Debt
Securities of each series shall be issuable in such form and denominations as shall be specified in the form of Debt Security for such series approved or established pursuant to
Section 201 or in the
Officers' Certificate delivered pursuant to Section 301. In the absence of any specification with respect to the Debt Securities of any series, the Registered Securities of such series, if any,
shall be issuable in denominations of $1,000 and any integral multiple thereof and the Bearer Securities of such series, if any, shall be issuable in the denominations of $5,000. 

          Section 303.  Execution, Authentication, Delivery and Dating.  

          (a)  The
Debt Securities shall be executed on behalf of the Company by its Chairman of the Board, a Vice Chairman of the Board, the President or a Vice President, and
by its Treasurer or one of its Assistant Treasurers or its Secretary or one of its Assistant Secretaries under its corporate seal reproduced thereon. The signature of any of these officers on the Debt
Securities may be manual or facsimile. Coupons shall bear the facsimile signature of an authorized officer of the Company. 

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

          (b)  At
any time and from time to time after the execution and delivery of this Indenture, Debt Securities of any series may be executed by the Company and delivered
to the Trustee for authentication, and, except as otherwise provided in this Article Three, shall thereupon be authenticated and delivered by the Trustee upon Company Order, without any further action
by the Company; provided, however, that, in connection with its original issuance, a Bearer Security may be delivered only outside the United States
and, except in the case of a temporary Global Security, only if the Company or its agent shall have received the certification required pursuant to Sections 304(b)(iii) and (iv), unless such
certification shall have been provided earlier pursuant to section 304(b)(v) hereof, and only if the Company has no reason to know that such certification is false. 

          To
the extent authorized in or pursuant to a Board Resolution and set forth in an Officers' Certificate, or established in one or more indentures supplemental hereto, such written
Company Order may be given by any one officer or employee of the Company, may be electronically transmitted, and may provide instructions as to registration of holders, principal amounts, rates of 

22

interest, maturity dates and other matters contemplated by such Board Resolution and Officers' Certificate or supplemental indenture to be so instructed in respect thereof. Before authorizing and
delivering the first Debt Securities of any series (and upon request of the Trustee thereafter), the Company shall deliver to the Trustee (i) the certificates called for under Sections 201 and
301 hereof and (ii) an Opinion of Counsel described in the next sentence. 

          In
authenticating such Debt Securities, and accepting the additional responsibilities under this Indenture in relation to any such Debt Securities, the Trustee shall be entitled to
receive, prior to the initial authentication of such Debt Securities, and (subject to Section 601) shall be fully protected in relying upon: 

     (i)   a
Board Resolution relating thereto and, if applicable, an appropriate record of any action taken pursuant to such resolution certified by the Secretary or an
Assistant Secretary of the Company; 

     (ii)  an
executed supplemental indenture, if any, relating thereto; 

     (iii)  an
Officers' Certificate setting forth the form and terms of the Debt Securities of such series and coupons, if any, pursuant to Sections 201 and 301 and stating
that all conditions precedent provided for in this Indenture relating to the issuance of such Debt Securities have been complied with; and 

     (iv)  an
Opinion of Counsel stating 

     (A)  that
the form of such Debt Securities and coupons, if any, has been established in or pursuant to a Board Resolution or by a supplemental indenture as permitted by
Section 201 in conformity with the provisions of this Indenture; 

     (B)  that
the terms of such Debt Securities and coupons, if any, have been established in or pursuant to a Board Resolution or by a supplemental indenture as permitted
by Section 301 in conformity with the provisions of this Indenture; and 

     (C)  that
such Debt Securities and coupons, if any, when authenticated and delivered by the Trustee and issued by the Company in the manner and subject to any
conditions specified in such Opinion of Counsel, will constitute valid and binding obligations of the Company, enforceable in accordance with their terms, subject, as to enforcement of remedies, to
applicable bankruptcy, reorganization, insolvency, moratorium or other laws affecting creditors' rights generally and the application of general principles of equity and except further as enforcement
thereof may be limited by (i) requirements that a claim with respect to any Debt Securities denominated other than in Dollars (or a Foreign Currency or currency unit judgment in respect of such
claim) be converted into Dollars at a rate of exchange prevailing on a date determined pursuant to applicable law or (ii) governmental authority to limit, delay or prohibit the making of
payments in Foreign Currencies or currency units or payments outside the United States. 

23

          (c)  If
the Company shall establish pursuant to Section 301 that the Debt Securities of a series are to be issued in whole or in part in the form of one or more
Global Securities, then the Company shall execute and the Trustee shall, in accordance with this Section and the Company Order with respect to such series, authenticate and deliver one or more Global
Securities in permanent or temporary form that (i) shall represent and shall be denominated in an aggregate amount equal to the aggregate principal amount of the Outstanding Debt Securities of
such series to be represented by one or more Global Securities, (ii) shall be registered in the name of the Depositary for such Global Security or Securities or the nominee of such Depositary
and (iii) shall be delivered by the Trustee to such Depositary or pursuant to such Depositary's instructions. 

          (d)  The
Trustee shall have the right to decline to authenticate and deliver any Debt Securities under this Section 303 if the issuance of such Debt Securities
will adversely affect the Trustee's own rights, duties or immunities under the Debt Securities and this Indenture or otherwise in a manner which is not reasonably acceptable to the Trustee. 

          (e)  If
all the Debt Securities of any series are not to be issued at one time, it shall not be necessary to deliver an Opinion of Counsel at the time of issuance of
each Debt Security, but such Opinion of Counsel, with appropriate modifications, may instead be delivered at or prior to the time of the first issuance of Debt Securities of such series. 

          (f)   Each
Registered Security shall be dated the date of its authentication. Each Bearer Security shall be dated as of the date specified as contemplated by
Section 301. 

          (g)  No
Debt Security or coupon attached thereto shall be entitled to any benefit under this Indenture or be valid or obligatory for any purpose, unless there appears
on such Debt Security a certificate of authentication substantially in the form provided for herein executed by the Trustee, and such certificate upon any Debt Security shall be conclusive evidence,
and the only evidence, that such Debt Security has been duly authenticated and delivered hereunder. Except as permitted by Section 306, the Trustee shall not authenticate and deliver any Bearer
Security unless all appurtenant coupons for interest then matured have been detached and cancelled. Notwithstanding the foregoing, if any Debt Security or portion thereof shall have been duly
authenticated and delivered hereunder but never issued and sold by the Company, and the Company shall deliver such Debt Security to the Trustee for cancellation as provided in Section 309
together with a written statement (which need not comply with Section 102 and need not be accompanied by an Opinion of Counsel) stating that such Debt Security or portion thereof has never been
issued and sold by the Company, for all purposes of this Indenture such Debt Security shall be deemed never to have been authenticated and delivered hereunder and shall never be entitled to the
benefits of this Indenture. 

          (h)  Each
Depositary designated pursuant to Section 301 for a Global Security in registered form must, at the time of its designation and at all times while it
serves as Depositary, be a clearing agency registered under the Securities Exchange Act of 1934 and any other applicable statute or regulation. 

24

          Section 304.  Temporary Debt Securities.  

          (a)  Pending
the preparation of definitive Debt Securities of any series, the Company may execute, and upon receipt of documents required by Sections 301 and 303,
together with a Company Order, the Trustee shall authenticate and deliver, temporary Debt Securities which are printed, lithographed, typewritten, mimeographed or otherwise produced, in any
denomination, substantially of the tenor and terms of the definitive Debt Securities in lieu of which they are issued in registered form or, if authorized, in bearer form with one or more coupons or
without coupons, and with such appropriate insertions, omissions, substitutions and other variations as the officers executing such Debt Securities may determine, as evidenced by their signatures on
such Debt Securities. In the case of Debt Securities of any series issuable as Bearer Securities, such temporary Debt Securities may be in global form, representing all or any part of the Outstanding
Debt Securities of such series. 

          (b)  Unless
otherwise provided pursuant to Section 301: 

     (i)   Except
in the case of temporary Debt Securities in global form, if temporary Debt Securities of any series are issued, the Company will cause definitive Debt
Securities of such series to be prepared without unreasonable delay. After the preparation of definitive Debt Securities of such series, the related temporary Debt Securities shall be exchangeable for
such definitive Debt Securities upon surrender of the temporary Debt Securities of such series at the office or agency of the Company in the Place of Payment for such series, without charge to the
Holder. Upon surrender for cancellation of any one or more temporary Debt Securities of any series (accompanied, if applicable, by all unmatured coupons and all matured coupons in default appertaining
thereto), the Company shall execute and the Trustee shall authenticate and deliver in exchange therefor a like principal amount of definitive Debt Securities of the same series of like tenor and terms
and of authorized denominations; provided, however, that no Bearer Security shall be delivered in exchange for a Registered Security; and  provided, further, that a Bearer Security shall be delivered in exchange for a Bearer Security only in compliance with the conditions set forth in
Section 305. 

     (ii)  If
Debt Securities of any series are issued in temporary global form, any such temporary Global Security shall, unless otherwise provided pursuant to
Section 301, be delivered to the Depositary for the benefit of Euroclear and Clearstream, for credit to the respective accounts of the beneficial owners of such Debt Securities (or to such
other accounts as they may direct). 

     (iii)  Without
unnecessary delay but in any event not later than the date specified in, or determined pursuant to the terms of, any such temporary Global Security (the
"Global Exchange Date"), the Company shall deliver definitive Debt Securities to the Trustee or the agent appointed by the Company pursuant to Section 301 to effect the exchange of the
temporary Global Security for definitive Debt Securities (the "Global Exchange Agent"), in an aggregate principal amount equal to the principal amount of such temporary Global Security, executed by
the Company. On or after the Global Exchange Date, such temporary Global Security shall be surrendered by the Depositary to the Global Exchange Agent, to be exchanged, in whole or from time to time in
part, for definitive Debt Securities without charge and the Trustee or the Global Exchange Agent, if authorized by the Trustee pursuant to 

25

Section 614, shall authenticate and deliver, in exchange for each portion of such temporary Global Security, an equal aggregate principal amount of definitive Debt Securities of the same series
of authorized denominations and of like tenor and terms as the portion of such temporary Global Security to be exchanged. Upon any exchange of a part of such temporary Global Security for definitive
Debt
Securities, the portion of the principal amount and any interest thereon so exchanged shall be endorsed by the Global Exchange Agent on a schedule to such temporary Global Security, whereupon the
principal amount and interest payable with respect to such temporary Global Security shall be reduced for all purposes by the amount so exchanged and endorsed. The definitive Debt Securities to be
delivered in exchange for any such temporary Global Security shall be in bearer form, registered form, global registered form or global bearer form, or any combination thereof, as specified as
contemplated by Section 301, and, if any combination thereof is so specified, as requested by the beneficial owner thereof; provided, however,
that, in the case of the exchange of the temporary Global Security for definitive Bearer Securities (including a definitive Global Bearer Security), upon such presentation by the Depositary, such
temporary Global Security shall be accompanied by a certificate signed by Euroclear as to the portion of such temporary Global Security held for its account then to be exchanged and a certificate
signed by Clearstream as to the portion of such temporary Global Security held for its account then to be exchanged, each in the form set forth in Exhibit B to this Indenture; and  provided, further, that definitive Bearer Securities (including a definitive Global Bearer Security) shall be delivered in exchange for a portion of a
temporary Global Security only in compliance with the requirements of Section 303. 

     (iv)  The
interest of a beneficial owner of Debt Securities of a series in a temporary Global Security shall be exchanged for definitive Debt Securities of the same
series and of like tenor and terms following the Global Exchange Date when the account holder instructs Euroclear or Clearstream, as the case may be, to request such exchange on such account holder's
behalf and, in the case of the exchange of the temporary Global Security for definitive Bearer Securities (including a definitive Global Bearer Security), the account holder delivers to Euroclear or
Clearstream, as the case may be, a certificate in the form set forth in Exhibit A-1 and, if applicable, A-2 to this Indenture, dated no earlier than 15 days prior
to the Global Exchange Date, copies of which certificate shall be available from the offices of Euroclear and Clearstream, the Global Exchange Agent, any authenticating agent appointed for such series
of Debt Securities and each Paying Agent. Unless otherwise specified in such temporary Global Security, any such exchange shall be made free of charge to the beneficial owners of such temporary Global
Security, except that a Person receiving definitive Debt Securities must bear the cost of insurance, postage, transportation and the like in the event that such Person does not take delivery of such
definitive Debt Securities in person at the offices of Euroclear and Clearstream. Definitive Debt Securities in bearer form to be delivered in exchange for any portion of a temporary Global Security
shall be delivered only outside the United States. 

     (v)  Until
exchanged in full as hereinabove provided, the temporary Debt Securities of any series shall in all respects be entitled to the same benefits under this
Indenture as definitive Debt Securities of the same series and of like tenor and terms authenticated and delivered hereunder, except that interest payable on a temporary Global Security on an Interest
Payment Date shall be payable to Euroclear and Clearstream on such Interest Payment Date only if there has been delivered by Euroclear and Clearstream to the Global Exchange Agent a 

26

certificate or certificates in the form set forth in Exhibit B to this Indenture dated no earlier than the first Interest Payment Date, for credit without further interest on or after such
Interest Payment Date to the respective accounts of the Persons who are the beneficial owners of such temporary Global Security on such Interest Payment Date and who have each delivered to Euroclear
or Clearstream, as the case may be, a certificate in the form set forth in Exhibit A-1 and, if applicable, A-2 to this Indenture dated no earlier than the first Interest
Payment Date. Any interest so received by Euroclear and Clearstream and not paid as herein provided prior to the Global Exchange Date shall be returned to the Global Exchange Agent which, upon
expiration of two years after such Interest Payment Date, shall repay such interest to the Company in accordance with Section 1003. 

          Section 305.  Registration; Registration of Transfer and Exchange.  

          The
Company shall cause to be kept at one of the offices or agencies to be maintained by the Company in accordance with the provisions of this Section 305 and
Section 1002, with respect to the Debt Securities of each series which are Registered Securities, a register (herein sometimes referred to as the "Security Register") in which, subject to such
reasonable regulations as it may prescribe, the Company shall provide for the registration of Registered Securities and of transfers of Registered Securities. Pursuant to Section 301, the
Company shall appoint, with respect to Debt Securities of each series which are Registered Securities, a "Security Registrar" for the purpose of registering such Debt Securities and transfers and
exchanges of such Debt Securities as herein provided. 

          Upon
surrender for registration of transfer of any Registered Security of any series at the office or agency of the Company maintained for such purpose, the Company shall execute,
and the Trustee shall authenticate and deliver, in the name of the designated transferee or transferees, one or more new Registered Securities of the same series of any authorized denomination or
denominations, of like tenor and terms and aggregate principal amount. 

          At
the option of the Holder, Registered Securities of any series may be exchanged for other Registered Securities of the same series of any authorized form and denomination, of like
tenor and terms and aggregate principal amount, upon surrender of the Registered Securities to be exchanged at such office or agency. Bearer Securities may not be delivered in exchange for Registered
Securities. 

          At
the option of the Holder, Registered Securities or Bearer Securities of any series may be issued in exchange for Bearer Securities (except as otherwise specified as contemplated
by Section 301 with respect to a Bearer Security in global form) of the same series, of any authorized denominations and of like tenor and terms and aggregate principal amount, upon surrender
of the Bearer Securities to be exchanged at any such office or agency, with all unmatured coupons and all matured coupons in default thereto appertaining. If the Holder of a Bearer Security is unable
to produce any such unmatured coupon or coupons or matured coupon or coupons in default, such exchange may be effected if the Bearer Securities are accompanied by payment in funds acceptable to the
Company and the Trustee in an amount equal to the face amount of such missing coupon or coupons, or the surrender of such missing coupon or coupons may be waived by the Company and the Trustee if
there be furnished to them such security or indemnity as they may require to save each of them and any Paying Agent harmless. If thereafter the Holder of such Security shall surrender to any 

27

Paying Agent any such missing coupon in respect of which such a payment shall have been made, such Holder shall be entitled to receive the amount of such payment; provided,
however, that, except as otherwise provided in Section 1002, interest represented by coupons shall be payable only upon presentation and surrender of those coupons at an
office or agency located outside the United States. Notwithstanding the foregoing, in case a Bearer Security of any series is surrendered at any such office or agency in exchange for a Registered
Security of the same series and like tenor and terms after the close of business at such office or agency on (i) any Regular Record Date and before the opening of business at such office or
agency on the relevant Interest Payment Date, or (ii) any Special Record Date and before the opening of business at such office or agency on the related date for payment of Defaulted Interest,
such Bearer Security shall be surrendered without the coupon relating to such Interest Payment Date or proposed date of payment, as the case may be. 

          Whenever
any Debt Securities are so surrendered for exchange, the Company shall execute, and the Trustee shall authenticate and deliver, the Debt Securities which the Holder making
the exchange is entitled to receive. 

          If
at any time the Depositary for the Debt Securities of a series notifies the Company that it is unwilling or unable to continue as Depositary for the Debt Securities of such series
or if at any time the Depositary for the Debt Securities of such series shall no longer be eligible under Section 303(h), the Company shall appoint a successor Depositary with respect to the
Debt Securities of such series. If a successor Depositary for the Debt Securities of such series is not appointed by the Company within 90 days after the Company receives such notice or becomes
aware of such ineligibility, the Company's election pursuant to Section 301(9) shall no longer be effective with respect to the Debt Securities of such series and the Company will execute, and
the Trustee, upon receipt of a Company Order for the
authentication and delivery of definitive Debt Securities of such series, will authenticate and deliver, Debt Securities of such series in definitive form in an aggregate principal amount equal to the
principal amount of the Global Security or Securities representing such series in exchange for such Global Security or Securities. 

          The
Company may at any time and in its sole discretion determine that the Debt Securities of any series issued in the form of one or more Global Securities shall no longer be
represented by such Global Security or Securities. In such event the Company will execute, and the Trustee, upon receipt of a Company Order for the authentication and delivery of definitive Debt
Securities of such series, will authenticate and deliver, Debt Securities of such series in definitive form and in an aggregate principal amount equal to the principal amount of the Global Security or
Securities representing such series in exchange for such Global Security or Securities. 

          If
specified by the Company pursuant to Section 301 with respect to a series of Debt Securities, the Depositary for such series of Debt Securities may surrender a Global
Security for such series of Debt Securities in exchange in whole or in part for Debt Securities of such series of like tenor and terms and in definitive form on such terms as are acceptable to the
Company and such Depositary. Thereupon, the Company shall execute, and the Trustee shall authenticate and deliver, without charge to any Holder, 

     (a)  to
each Person specified by such Depositary a new Debt Security or Securities of the same series, of like tenor and terms and of any authorized denominations as
requested by 

28

 

such
person in aggregate principal amount equal to and in exchange for such Person's beneficial interest in the Global Security; and 

     (b)  to
such Depositary a new Global Security of like tenor and terms and in a denomination equal to the difference, if any, between the principal amount of the
surrendered Global Security and the aggregate principal amount of Debt Securities delivered to Holders thereof. 

          In
any exchange provided for in any of the preceding three paragraphs, the Company will execute and the Trustee will authenticate and deliver Debt Securities (a) in definitive
registered form in authorized denominations, if the Debt Securities of such series are issuable as Registered Securities, (b) in definitive bearer form in authorized denominations, with coupons
attached, if the Debt Securities of such series are issuable as Bearer Securities or (c) as either Registered or Bearer Securities, as shall be specified by the beneficial owner thereof, if the
Debt Securities of such series are issuable in either form; provided, however, that no definitive Bearer Security shall be delivered in exchange for a
temporary Global Security unless the Company or its agent shall have received from the person entitled to receive the definitive Bearer Security a certificate substantially in the form set forth in
Exhibit A-1 and, if applicable, A-2 hereto; and provided further that delivery of a Bearer Security shall occur only
outside the United States; and provided further that no definitive Bearer Security will be issued if the Company has reason to know that any such
certificate is false. 

          Upon
the exchange of a Global Security for Debt Securities in definitive form, such Global Security shall be cancelled by the Trustee. Registered Securities issued in exchange for a
Global Security pursuant to this Section shall be registered in such names and in such authorized denominations as the Depositary for such Global Security, pursuant to instructions from its direct or
indirect participants or otherwise, shall instruct the Trustee. The Trustee shall deliver such Registered Securities to the persons in whose names such Debt Securities are so registered. The Trustee
shall deliver Bearer Securities issued in exchange for a Global Security pursuant to this Section to the persons, and in such authorized denominations, as the Depositary for such Global Security,
pursuant to instructions from its direct or indirect participants or otherwise, shall instruct the Trustee; provided, however, that no definitive Bearer
Security shall be delivered in exchange for a temporary Global Security unless the Company or its agent shall have received from the person entitled to receive the definitive Bearer Security a
certificate substantially in the form set forth in Exhibit A-1 and, if applicable, A-2 hereto; and provided further that
delivery of a Bearer Security shall occur only outside the United States; and provided further that no definitive Bearer Security will be issued if the
Company has reason to know that any such certificate is false. 

          All
Debt Securities issued upon any registration of transfer or exchange of Debt Securities shall be the valid obligations of the Company, evidencing the same debt, and entitled to
the same benefits under this Indenture, as the Debt Securities surrendered upon such registration of transfer or exchange. 

          Every
Registered Security presented or surrendered for registration of transfer or for exchange shall (if so required by the Company, the Security Registrar or the Trustee) be duly
endorsed, or be accompanied by a written instrument of transfer in form satisfactory to the Company, the Security 

29

Registrar and the Trustee duly executed, by the Holder thereof or such Holder's attorney duly authorized in writing. 

          No
charge to any Holder shall be made for any registration of transfer or exchange of Debt Securities, but the Company may require payment of a sum sufficient to cover any tax or
other governmental charge that may be imposed in connection with any transfer, registration of transfer or exchange of Debt Securities, other than exchanges expressly provided in this Indenture to be
made at the Company's own expense or without expense or without charge to the Holders. 

          The
Company shall not be required (i) to issue, register the transfer of or exchange Debt Securities of any particular series to be redeemed for a period of fifteen days
preceding the first publication of the relevant notice of redemption or, if Registered Securities are outstanding and there is no publication, the mailing of the relevant notice of redemption of Debt
Securities of such series selected for redemption under Section 1103 and ending at the close of business on the day of such mailing, or (ii) to register the transfer of or exchange any
Registered Security so selected for redemption in whole or in part, except the unredeemed portion of such Registered Security being redeemed in part, or (iii) to exchange any Bearer Security so
selected for redemption except that such a Bearer Security may be exchanged for a Registered Security of like tenor and terms of that series, provided
that such Registered Security shall be simultaneously surrendered for redemption. 

          Notwithstanding
anything herein to the contrary, the exchange of Bearer Securities into Registered Securities shall be subject to applicable laws and regulations in effect at the
time of exchange; neither the Company, the Trustee nor the Security Registrar shall exchange any Bearer Securities into Registered Securities if it has received an Opinion of Counsel that as a result
of such exchanges the
Company would suffer adverse consequences under the United States Federal income tax laws and regulations then in effect and the Company has delivered to the Trustee a Company Order directing the
Trustee not to make such exchanges thereafter unless and until the Trustee receives a subsequent Company Order to the contrary. The Company shall deliver copies of such Company Orders to the Security
Registrar. 

          Section 306.  Mutilated, Destroyed, Lost and Stolen Debt Securities.  

          If
(i) any mutilated Debt Security or a Bearer Security with a mutilated coupon appertaining to it is surrendered to a Paying Agent outside the United States designated by the
Company, or, in the case of any Registered Security, to the Trustee, or (ii) the Company and the Trustee receive evidence to their satisfaction of the destruction, loss or theft of any Debt
Security or coupon, and there is delivered to the Company and the Trustee such security or indemnity as may be required by them to save each of them harmless, then, in the absence of notice to the
Company and the Trustee that such Debt Security or coupon has been acquired by a bona fide purchaser, the Company shall execute and upon its written request the Trustee shall authenticate and deliver,
in exchange for any such mutilated Debt Security or Bearer Security with a mutilated coupon appertaining to it or to which a destroyed, lost or stolen coupon appertains (with all appurtenant coupons
not destroyed, lost or stolen) or in lieu of any such destroyed, lost or stolen Debt Security, a new Debt Security of like tenor and terms and principal amount, bearing a number not contemporaneously
outstanding, with coupons corresponding to the coupons, if any, appertaining to such destroyed, lost or stolen Debt Security or to the Debt Security to which such destroyed, lost or stolen coupon
appertains; provided, however, that 

30

any such new Bearer Security will be delivered only in compliance with the conditions set forth in Section 305. 

          In
case any such mutilated, destroyed, lost or stolen Debt Security or coupon has become or is about to become due and payable, the Company in its discretion may, instead of issuing
a new Debt Security, pay such Debt Security or coupon; provided, however, that payment of principal of (and premium, if any) and any interest on Bearer
Securities shall, except as otherwise provided in Section 1002, be payable only at an office or agency located outside the United States; and provided,
further, that, with respect to any such coupons, interest represented thereby (but not any additional amounts payable as provided in Section 1006), shall be payable only
upon presentation and surrender of the coupons appertaining thereto. 

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

          Every
new Debt Security of any series, with its coupons, if any, issued pursuant to this Section in lieu of any destroyed, lost or stolen Debt Security, or in exchange for a Bearer
Security to which a destroyed, lost or stolen coupon appertains, shall constitute an original additional contractual obligation of the Company, whether or not the destroyed, lost or stolen Debt
Security and its coupons, if any, or the destroyed, lost or stolen coupon shall be at any time enforceable by anyone, and any such new Debt Security and coupons, if any, shall be entitled to all the
benefits of this Indenture equally and proportionately with any and all other Debt Securities of that series and their coupons, if any, duly issued hereunder. 

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

          Section 307.  Payment of Interest; Interest Rights Preserved.  

          Interest
on any Registered Security which is payable, and is punctually paid or duly provided for, on any Interest Payment Date shall be paid to the Person in whose name that
Registered Security (or one or more Predecessor Securities) is registered at the close of business on the Regular Record Date for such interest. In case a Bearer Security of any series is surrendered
in exchange for a Registered Security of such series after the close of business (at an office or agency in a Place of Payment for such series) on any Regular Record Date and before the opening of
business (at such office or agency) on the next succeeding Interest Payment Date, such Bearer Security shall be surrendered without the coupon relating to such Interest Payment Date and interest will
not be payable on such Interest Payment Date in respect of the Registered Security issued in exchange for such Bearer Security, but will be payable only to the Holder of such coupon when due in
accordance with the provisions of this Indenture. At the option of the Company, payment of interest on any Registered Security may be made by check in the currency designated for such payment pursuant
to the terms of such Registered Security mailed to the address of the Person entitled thereto as such address shall 

31

appear in the Security Register or by wire transfer to an account in such currency designated by such Person in writing not later than ten days prior to the date of such payment. 

          Any
interest on any Registered Security of any series which is payable, but is not punctually paid or duly provided for, on any Interest Payment Date (herein called "Defaulted
Interest") shall forthwith cease to be payable to the registered Holder on the relevant Regular Record Date by virtue of his having been such Holder, and such Defaulted Interest may be paid by the
Company, at its election in each case, as provided in Clause (1) or (2) below: 

     (1)  The
Company may elect to make payment of any Defaulted Interest to the Persons in whose names the Registered Securities of such series (or their respective
Predecessor Securities) are registered at the close of business on a Special Record Date for the payment of such Defaulted Interest, which shall be fixed in the following manner. The Company shall
notify the Trustee in writing of the amount of Defaulted Interest proposed to be paid on each Registered Security of such series and the date of the proposed payment, and at the same time the Company
shall deposit with the Trustee an amount of money and/or Government Obligations the payments of principal and interest on which when due (and without reinvestment) will provide money in such amounts
as will (together with any money irrevocably deposited in trust with the Trustee, without investment) be equal to the aggregate amount proposed to be paid in respect of such Defaulted Interest or
shall make arrangements satisfactory to the Trustee for such deposit prior to the date of the proposed payment, such money and/or Government Obligations when deposited to be held in trust for the
benefit of the Persons entitled to such Defaulted Interest as in this Clause provided. Thereupon the Trustee shall fix a Special Record Date for the payment of such Defaulted Interest which shall be
not more than 15 days and not less than 10 days prior to the date of the proposed payment and not less than 10 days after the receipt by the Trustee of the notice of the proposed
payment. The Trustee shall promptly notify the Company of such Special Record Date. Unless the Trustee is acting as the Security Registrar, promptly after such Special Record Date, the Company shall
furnish the Trustee with a list, or shall make arrangements satisfactory to the Trustee with respect thereto, of the names and addresses of, and principal amounts of Registered Securities of such
series held by, the Holders appearing on the Security Register at the close of business on such Special Record Date. In the name and at the expense of the Company, the Trustee shall cause notice of
the proposed payment of such Defaulted Interest and the Special Record Date therefor to be mailed, first-class postage prepaid, to each Holder of Registered Securities of such series at his address as
it appears in the Security Register, not less than 10 days prior to such Special Record Date. Notice of the proposed payment of such Defaulted Interest and the Special Record Date therefor
having been mailed as aforesaid, such Defaulted Interest shall be paid to the Persons in whose names the Registered Securities of such series (or their respective Predecessor Securities) are
registered at the close of business on such Special Record Date and shall no longer be payable pursuant to the following Clause (2). In case a Bearer Security of any series is surrendered at
the office or agency in a Place of Payment for such series in exchange for a Registered Security of such series after the close of business at such office or agency on any Special Record Date and
before the opening of business at such office or agency on the related proposed date for payment of Defaulted Interest, such Bearer Security shall
be surrendered without the coupon relating to such proposed date of payment and Defaulted Interest will not be payable on such proposed date of payment in respect of the Registered 

32

Security issued in exchange for such Bearer Security, but will be payable only to the Holder of such coupon when due in accordance with the provisions of this Indenture. 

     (2)  The
Company may make payment of any Defaulted Interest on the Registered Securities of any series in any other lawful manner not inconsistent with the requirements
of any securities exchange on which the Registered Securities may be listed, and upon such notice as may be required by such exchange, if, after notice given by the Company to the Trustee of the
proposed payment pursuant to this Clause, such manner of payment shall be deemed practicable by the Trustee. 

          Subject
to the foregoing provisions of this Section, each Debt Security delivered under this Indenture upon registration of transfer of or in exchange for or in lieu of any other
Debt Security shall carry the rights to interest accrued and unpaid, and to accrue, which were carried by such other Debt Security. 

          Subject
to the limitations set forth in Section 1002, the Holder of any coupon appertaining to a Bearer Security shall be entitled to receive the interest payable on such
coupon upon presentation and surrender of such coupon on or after the Interest Payment Date of such coupon at an office or agency maintained for such purpose pursuant to Section 1002. 

          Section 308.  Persons Deemed Owners.  

          Prior
to due presentment of a Registered Security for registration of transfer, the Company, the Trustee and any agent of the Company or of the Trustee may treat the Person in whose
name such Registered Security is registered as the owner of such Registered Security for the purpose of receiving payment of principal of (and premium, if any) and (subject to Section 307)
interest on such Registered Security and for all other purposes whatsoever, whether or not such Registered Security be overdue, and neither the Company, the Trustee nor any agent of the Company or the
Trustee shall be affected by notice to the contrary. 

          The
Company, the Trustee and any agent of the Company or the Trustee may treat the bearer of any Bearer Security and the bearer of any coupon as the absolute owner of such Bearer
Security or coupon for the purpose of receiving payment thereof or on account thereof and for all other purposes whatsoever, whether or not such Bearer Security or coupon be overdue, and neither the
Company, the Trustee nor any agent of the Company or the Trustee shall be affected by notice to the contrary. 

          None
of the Company, the Trustee, any Paying Agent or the Security Registrar will have any responsibility or liability for any aspect of the records relating to or payments made on
account of beneficial ownership interests of a Global Security or for maintaining, supervising or reviewing any records relating to such beneficial ownership interests. 

          Section 309.  Cancellation.  

          Unless
otherwise provided with respect to a series of Debt Securities, all Debt Securities and coupons surrendered for payment, redemption, repayment, transfer, exchange or credit 

33

against any sinking fund payment pursuant to this Indenture shall, if surrendered to the Company or any agent of the Company, be delivered to the Trustee and shall be promptly cancelled by it. The
Company may at any time deliver to the Trustee for cancellation any Debt Securities previously authenticated and delivered hereunder which the Company may have acquired in any manner whatsoever, and
all Debt Securities so delivered shall be promptly cancelled by the Trustee. No Debt Securities shall be authenticated in lieu of or in exchange for any Debt Securities cancelled as provided in this
Section, except as expressly permitted by this Indenture. All cancelled Debt Securities and coupons held by the Trustee shall be destroyed and certification of their destruction delivered to the
Company unless by a Company Order the Company shall direct that the cancelled Debt Securities or coupons be returned to it. 

          Section 310.  Computation of Interest.  

          Except
as otherwise specified as contemplated by Section 301 for Debt Securities of any series, interest on the Debt Securities of each series shall be computed on the basis
of a 360-day year of twelve 30-day months. 

          Section 311.  Certification by a Person Entitled to Delivery of a Bearer
Security.  

          Whenever
any provision of this Indenture or a Debt Security contemplates that certification be given by a Person entitled to delivery of a Bearer Security, such certification shall
be provided substantially in the form of Exhibit A-1 and, if applicable, A-2 hereto, with only such changes as shall be approved by the Company and consented to by the
Trustee, whose consent shall not unreasonably be withheld. 

          Section 312.  Judgments.  

          The
Company agrees that, to the fullest extent possible under applicable law and except as may otherwise be specified as contemplated in Section 301, (a) the
obligation, if any, of the Company to pay the principal of (and premium, if any) and interest on the Debt Securities of any series and any appurtenant coupons in a Foreign Currency, composite currency
or Dollars (the "Designated Currency") as may be specified pursuant to Section 301 is of the essence, and judgments in respect of such Debt Securities shall be given in the Designated Currency;
(b) the obligation of the Company to make payments in the Designated Currency of the principal of (and premium, if any) and interest on such Debt Securities and any appurtenant coupons shall,
notwithstanding any payment in any other currency (whether pursuant to a judgment or otherwise), be discharged only to the extent of the amount in the Designated Currency that the Holder receiving
such payment may, in accordance with normal banking procedures, purchase with the sum paid in such other currency (after any premium and cost of exchange) in the country of issue of the Designated
Currency in the case of Foreign Currency or Dollars or in the international banking community in the case of a composite currency on the Business Day immediately following the day on which such Holder
receives such payment; (c) if the amount in the Designated Currency that may be so purchased for any reason falls short of the amount originally due, the Company shall pay such additional
amounts as may be necessary to compensate for such shortfall; and (d) any obligation of the Company not discharged by such payment shall be due as a separate and independent obligation and,
until discharged as provided herein, shall continue in full force and effect. 

34

  ARTICLE FOUR
  
  Satisfaction and Discharge         

          Section 401.  Satisfaction and Discharge of Indenture.  

          This
Indenture shall upon Company Request cease to be of further effect (except as to any surviving rights of registration of transfer or exchange of Debt Securities herein expressly
provided for and rights to receive payments of principal and interest thereon and any right to receive additional amounts, as provided in Section 1006) and the Trustee, at the expense of the
Company, shall execute proper instruments acknowledging satisfaction and discharge of this Indenture when 

     (1)  either 

     (A)  all
Debt Securities theretofore authenticated and delivered and all coupons appertaining thereto (other than (i) coupons appertaining to Bearer Securities
surrendered in exchange for Registered Securities and maturing after such exchange, surrender of which is not required or has been waived as provided in Section 305, (ii) Debt Securities
and coupons which have been destroyed, lost or stolen and which have been replaced or paid as provided in Section 306, (iii) coupons appertaining to Bearer Securities called for
redemption or surrendered for repayment and maturing after the relevant Redemption Date or Repayment Date, as appropriate, surrender of which has been waived as provided in Section 1106 or 1303
and (iv) Debt Securities and coupons for whose payment money and/or Government Obligations have theretofore been deposited in trust or segregated and held in trust by the Company and thereafter
repaid to the Company or discharged from such trust, as provided in Section 1003) have been delivered to the Trustee cancelled or for cancellation; or 

     (B)  all
such Debt Securities not theretofore delivered to the Trustee for cancellation 

     (i)   have
become due and payable, or 

     (ii)  will
become due and payable at their Stated Maturity within one year, or 

     (iii)  are
to be called for redemption within one year under arrangements satisfactory to the Trustee for the giving of notice of redemption by the Trustee in the name,
and at the expense, of the Company, 

and
the Company, in the case of (B)(i), (B)(ii) or (B)(iii) above, has irrevocably deposited or caused to be deposited with the Trustee as trust funds in trust for the purpose money
and/or Government Obligations the payments of principal and interest on which when due (and without reinvestment) will provide money in such amounts as 

35

will (together with any money irrevocably deposited in trust with the Trustee, without investment) be sufficient to pay and discharge the entire indebtedness on such Debt Securities and coupons of
such series for principal (and premium, if any) and interest, and any mandatory sinking fund, repayment or analogous payments thereon, on the scheduled due dates therefor to the date of such deposit
(in the case of Debt Securities and coupons which have become due and payable) or to the Stated Maturity or Redemption Date, if any, and all Repayment Dates (in the case of Debt Securities repayable
at the option of the Holders thereof); provided, however, that in the event a petition for relief under any applicable Federal or state bankruptcy,
insolvency, reorganization or other similar law is filed with respect to the Company within 91 days after the deposit, the obligations of the Company under the Indenture with respect to the
Debt Securities of such series shall not be deemed terminated or discharged, and in such event the Trustee shall be required to return the deposited money and Government Obligations then held by the
Trustee to the Company; 

     (2)  the
Company has paid or caused to be paid all other sums payable hereunder by the Company; and 

     (3)  the
Company has delivered to the Trustee an Officers' Certificate and an Opinion of Counsel each stating that all conditions precedent herein provided for relating
to the satisfaction and discharge of this Indenture have been complied with. 

Notwithstanding
the satisfaction and discharge of this Indenture, the obligations of the Company to the Trustee under Section 607 and, if money or Government Obligations shall have been
deposited with the
Trustee pursuant to Subclause (B) of Clause (1) of this Section, the obligations of the Trustee under Section 402 and the last paragraph of Section 1003 shall survive. 

          Section 402.  Application of Trust Money and Government Obligations.  

          (a)  Subject
to the provisions of the last paragraph of Section 1003, all money and Government Obligations deposited with the Trustee pursuant to
Section 401, 403 or 1501 shall be held in trust and such money and the principal and interest received on such Government Obligations shall be applied by it, in accordance with the provisions
of the Debt Securities, any coupons and this Indenture, to the payment, either directly or through any Paying Agent (including the Company acting as its own Paying Agent) as the Trustee may determine,
to the Persons entitled thereto, of the principal (and premium, if any) and interest for whose payment such money or Government Obligations have been deposited with the Trustee. 

          (b)  The
Trustee shall deliver or pay to the Company from time to time upon Company Request any Government Obligations or money held by it as provided in
Section 403 or 1501 which, in the opinion of a nationally recognized firm of independent public accountants expressed in a written certification thereof delivered to the Trustee, are then in
excess of the amount thereof which then would have been required to be deposited for the purpose for which such Government Obligations or money were deposited or received. 

36

          (c)  The Trustee shall deliver to the Company from time to time upon Company Request any Government Obligations held by it as provided in Section 403 or 1501,
provided that the Company in substitution therefor simultaneously delivers to the Trustee, money or other Government Obligations which, in the opinion of a nationally recognized firm of independent
public accountants expressed in a written certification thereof delivered to the Trustee, would then be sufficient to satisfy the Company's payment obligations in respect of the Debt Securities in the
manner contemplated by Section 403 or 1501. 

          Section 403.  Satisfaction, Discharge and Defeasance of Debt Securities of any
Series.  

          If
this Section 403 is specified, as contemplated by Section 301, to be applicable to Debt Securities of any series, then, notwithstanding Section 401,
(i) the Company shall be deemed to have paid and discharged the entire indebtedness on all the Outstanding Debt Securities of any such series and related coupons; (ii) the provisions of
this Indenture as it relates to such Outstanding Debt Securities and related coupons shall no longer be in effect (except as to (A) the rights of Holders of Debt Securities to receive, from the
trust fund described in subparagraph (1) below, payment of (x) the principal of (and premium, if any) and any installment of principal of (and premium, if any) or interest on such Debt
Securities and related coupons on the Stated Maturity of such principal (and premium, if any) or installment of principal (and premium, if any) or interest or (y) any mandatory sinking fund,
repayment or analogous payments applicable to the Debt Securities of that series on that day on which such payments are due and payable in accordance with the terms of this Indenture and of such Debt
Securities, (B) the Company's obligations with respect to such Debt Securities under Sections 304, 305, 306, 1002, 1003 and 1006, and (C) the rights, powers, trusts, duties and
immunities of the Trustee hereunder, including those under Section 607 hereof); and (iii) the Trustee, at the expense of the Company, shall, upon Company Order, execute proper
instruments acknowledging satisfaction and discharge of such indebtedness, when 

     (1)  either

     (A)  with
respect to all Outstanding Debt Securities of such series and related coupons, with reference to this Section 403, the Company has deposited or caused
to be deposited with the Trustee irrevocably, as trust funds in trust, money and/or Government Obligations the payments of principal and interest on which when due (and without reinvestment) will
provide money in such amounts as will (together with any money irrevocably deposited in trust with the Trustee, without investment) be sufficient to pay and discharge (i) the principal of (and
premium, if any) and interest on the Outstanding Debt Securities of that series on the Stated Maturity of such principal or interest or, if such series may be redeemed by the Company prior to the
Stated Maturity thereof and the Company shall have given irrevocable instructions to the Trustee to effect such redemption, at the date fixed for such redemption pursuant to Article Eleven, and
(ii) any mandatory sinking fund payments or analogous payments applicable to Debt Securities of such series on the date on which such payments are due and payable in accordance with the terms
of this Indenture and of such Debt Securities; or 

37

     (B)  the Company has properly fulfilled such other means of satisfaction and discharge as is specified, as contemplated by Section 301, to be applicable to the
Debt Securities of such series; 

     (2)  the
Company has paid or caused to be paid all sums payable with respect to the Outstanding Debt Securities of such series and related coupons; 

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

     (4)  no
Event of Default or event which, with the giving of notice or lapse of time, or both, would become an Event of Default pursuant to Section 501(1), (2),
(3), (6) or (7) with respect to the Debt Securities of such series shall have occurred and be continuing on the date of such deposit and no Event of Default under Section 501(6)
or Section 501(7) or event which, with the giving of notice or lapse of time, or both, would become an Event of Default under Section 501(6) or Section 501(7) shall have occurred
and be continuing on the 91st day after such date; provided, however, that should that condition fail to be satisfied on or before such 91st day, the Trustee shall promptly, upon satisfactory receipt
of evidence of such failure, return such deposit to the Company; 

     (5)  if
the Debt Securities of that series are then listed on any domestic or foreign securities exchange, the Company shall have delivered to the Trustee an Opinion of
Counsel to the effect that such deposit, defeasance and discharge will not cause such Debt Securities to be delisted; and 

     (6)  the
Company has delivered to the Trustee an Officers' Certificate and an Opinion of Counsel, each stating that all conditions precedent herein provided for
relating to the satisfaction and discharge of the entire indebtedness of all Outstanding Debt Securities and related coupons have been complied with. 

          Any
deposits with the Trustee referred to in Section 403(1)(A) above shall be irrevocable and shall be made under the terms of an escrow or trust agreement in form and
substance satisfactory to the Trustee. If any Outstanding Debt Securities of such series are to be redeemed prior to their Stated Maturity, whether pursuant to any optional redemption provisions or in
accordance with any mandatory sinking fund requirement, the applicable escrow or trust agreement shall provide therefor and the Company shall make such arrangements as are satisfactory to the Trustee
for the giving of notice of redemption by the Trustee in the name, and at the expense, of the Company. 

          Upon
the satisfaction of the conditions set forth in this Section 403 with respect to all the Outstanding Debt Securities of any series, the terms and conditions of such
series, including the terms and conditions with respect thereto set forth in this Indenture, shall no longer be binding upon, or applicable to, the Company;  provided that the Company shall not be
discharged from any payment obligations in
respect of Debt Securities of such series which are deemed not to be Outstanding under clause (iii) of the definition thereof if such obligations continue to be valid obligations of the Company
under applicable law. 

38

          Notwithstanding the cessation, termination and discharge of all obligations, covenants and agreements (except as provided above in this Section 403) of the Company under this
Indenture with respect to any series of Debt Securities, the obligations of the Company to the Trustee under Section 607, and the obligations of the Trustee under Section 402 and the
last paragraph of Section 1003, shall survive with respect to such series of Debt Securities. 

  ARTICLE FIVE
  
  Remedies         

          Section 501.  Events of Default.  

          "Event
of Default", wherever used herein with respect to Debt Securities of any series, means any one of the following events (whatever the reason for such Event of Default and
whether it shall be voluntary or involuntary or be effected by operation of law, pursuant to any judgment, decree or order of any court or any order, rule or regulation of any administrative or
governmental body): 

     (1)  default
in the payment of any interest upon any Debt Security of such series when it becomes due and payable, and continuance of such default for a period of
30 days; or 

     (2)  default
in the payment of the principal of (or premium, if any, on) any Debt Security of such series at its Maturity; or 

     (3)  default
in the deposit of any sinking fund payment, when and as due by the terms of a Debt Security of such series; or 

     (4)  default
in the performance, or breach, of any covenant or warranty of the Company in this Indenture (other than a covenant or warranty a default in whose
performance or whose breach is elsewhere in this Section specifically dealt with or which has expressly been included in this Indenture solely for the benefit of Debt Securities of a series other than
such series), and continuance of such default or breach for a period of 90 days after there has been given by registered or certified mail, to the Company by the Trustee, or to the Company and
the Trustee by the Holders of at least 25% in principal amount of the Outstanding Debt Securities of such series, a written notice specifying such default or breach and requiring it to be remedied and
stating that such notice is a "Notice of Default" hereunder, or 

     (5)  a
default under any Indebtedness for money borrowed by the Company or any Subsidiary (including a default with respect to Debt Securities of any series other than
that series) or under any Mortgage, indenture or instrument under which there may be issued or by which there may be secured or evidenced any Indebtedness for money borrowed by the Company or any
Subsidiary (including this Indenture), whether such Indebtedness now exists or shall hereafter be created, which default shall have resulted in such Indebtedness in an outstanding principal amount in
excess of $20 million becoming or being declared due and payable prior to the date on which it would otherwise have become due and payable, without 

39

such acceleration having been rescinded or annulled, or such Indebtedness having been discharged, within a period of 10 days after there shall have been given, by registered or certified mail,
to the Company by the Trustee or to the Company and the Trustee by the Holders of at least 25% in principal amount of the Outstanding Securities of that series a written notice specifying such
default and requiring the Company to cause such acceleration to be rescinded or annulled or cause such Indebtedness to be discharged and stating that such notice is a "Notice of Default" hereunder; or 

     (6)  the
entry by a court having jurisdiction in the premises of (A) a decree or order for relief in respect of the Company in an involuntary case or proceeding
under any applicable Federal or state bankruptcy, insolvency, reorganization or other similar law or (B) a decree or order adjudging the Company a bankrupt or insolvent, or approving as
properly filed a petition seeking reorganization, arrangement, adjustment or composition of or in respect of the Company under any applicable Federal or State law,
or appointing a custodian, receiver, liquidator, assignee, trustee, sequestrator or other similar official of the Company or of any substantial part of its property, or ordering the winding up or
liquidation of its affairs, and the continuance of any such decree or order for relief or any such other decree or order unstayed and in effect for a period of 90 consecutive days; or 

     (7)  the
commencement by the Company of a voluntary case or proceeding under any applicable Federal or state bankruptcy, insolvency, reorganization or other similar law
or of any other case or proceeding to be adjudicated a bankrupt or insolvent, or the consent by it to the entry of a decree or order for relief in respect of the Company in an involuntary case or
proceeding under any applicable Federal or state bankruptcy, insolvency, reorganization or other similar law or to the commencement of any bankruptcy or insolvency case or proceeding against it, or
the filing by it of a petition or answer or consent seeking reorganization or relief under any applicable Federal or State law, or the consent by it to the filing of such petition or to the
appointment of or taking possession by a custodian, receiver, liquidator, assignee, trustee, sequestrator or similar official of the Company or of any substantial part of its property, or the making
by it of an assignment for the benefit of creditors, or the admission by it in writing of its inability to pay its debts generally as they become due, or the taking of corporate action by the Company
in furtherance of any such action; or 

     (8)  any
other Event of Default provided with respect to Debt Securities of such series specified as contemplated by Section 301. 

          Section 502.  Acceleration of Maturity; Rescission and Annulment.  

          If
an Event of Default with respect to Debt Securities of any series at the time Outstanding occurs and is continuing, then and in every such case the Trustee or the Holders of not
less than 25% in principal amount of Outstanding Debt Securities of such series may declare the principal amount (or, if the Debt Securities of such series are Original Issue Discount Securities, such
portion of the principal amount as may be specified in the terms of such series) of and all accrued but unpaid interest on all the Debt Securities of such series to be due and payable immediately, by
a notice in writing to the Company (and to the Trustee if given by such Holders), and upon any such declaration such principal amount (or specified amount) shall become immediately due and payable.
Upon 

40

 

payment
of such amount, all obligations of the Company in respect of the payment of principal of the Debt Securities of such series shall terminate. 

          At
any time after such a declaration of acceleration with respect to Debt Securities of any series has been made and before a judgment or decree for payment of the money due has been
obtained by the Trustee as hereinafter in this Article provided, the Holders of a majority in principal amount of the Outstanding Debt Securities of such series, by written notice to the Company and
the Trustee, may rescind and annul such declaration and its consequences if 

     (1)  the
Company has paid or deposited with the Trustee a sum sufficient to pay 

     (A)  all
overdue installments of interest on all Debt Securities of such series, 

     (B)  the
principal of (and premium, if any, on) any Debt Securities of such series which have become due otherwise than by such declaration of acceleration and interest
thereon at the rate or rates prescribed therefor in such Debt Securities, 

     (C)  to
the extent that payment of such interest is lawful, interest upon overdue installments of interest at the rate or rates prescribed therefor in such Debt
Securities, and 

     (D)  all
sums paid or advanced by the Trustee hereunder and the reasonable compensation, expenses, disbursements and advances of the Trustee, its agents and counsel; 

     and 

     (2)  all
Events of Default with respect to Debt Securities of such series, other than the non-payment of the principal of Debt Securities of such series
which have become due solely by such declaration of acceleration, have been cured or waived as provided in Section 513. 

No
such rescission shall affect any subsequent default or impair any right consequent thereon. 

          Section 503.  Collection of Indebtedness and Suits for Enforcement by
Trustee.  

          The
Company covenants that if: 

     (1)  default
is made in the payment of any installment of interest on any Debt Security when such interest becomes due and payable and such default continues for a
period of 30 days, or 

     (2)  default
is made in the payment of the principal of (or premium, if any, on) any Debt Security at the Maturity thereof, 

41

the
Company will, upon demand of the Trustee, pay to it, for the benefit of the Holders of such Debt Securities and any related coupons, the amount then due and payable on such Debt Securities and
coupons for principal (and premium, if any) and interest and, to the extent that payment of such interest shall be legally enforceable, interest upon the overdue principal (and premium, if any) and,
upon overdue installments of interest, at the rate or rates prescribed therefor in such Debt Securities, and, in addition thereto, such further amount as shall be sufficient to cover the costs and
expenses of collection, including the reasonable compensation, expenses, disbursements and advances of the Trustee, its agents and counsel. 

          If
the Company fails to pay such amounts forthwith upon such demand, the Trustee, in its own name and as trustee of an express trust, may institute a judicial proceeding for the
collection of the sums so due and unpaid, and may prosecute such proceeding to judgment or final decree, and may enforce the same against the Company or any other obligor upon such Debt Securities and
coupons and collect the
moneys adjudged or decreed to be payable in the manner provided by law out of the property of the Company or any other obligor upon such Debt Securities and coupons, wherever situated. 

          If
an Event of Default with respect to Debt Securities of any series occurs and is continuing, the Trustee may in its discretion proceed to protect and enforce its rights and the
rights of the Holders of Debt Securities of such series and any related coupons by such appropriate judicial proceedings as the Trustee shall deem most effectual to protect and enforce any such
rights, whether for the specific enforcement of any covenant or agreement in this Indenture or in aid of the exercise of any power granted herein, or to enforce any other proper remedy. 

          Section 504.  Trustee May File Proofs of Claim.  

          In
case of the pendency of any receivership, insolvency, liquidation, bankruptcy, reorganization, arrangement, adjustment, composition or other judicial proceedings, or any voluntary
or involuntary case under the Federal bankruptcy laws as now or hereafter constituted, relative to the Company or any other obligor upon the Debt Securities of a particular series or any related
coupons or the property of the Company or of such other obligor or their creditors, the Trustee (irrespective of whether the principal of such Debt Securities shall then be due and payable as therein
expressed or by declaration or otherwise and irrespective of whether the Trustee shall have made any demand on the Company for the payment of overdue principal or interest) shall be entitled and
empowered, by intervention in such proceedings or otherwise, 

     (1)  to
file and prove a claim for the whole amount of principal (and premium, if any) and interest owing and unpaid in respect of the Debt Securities of such series
and any appurtenant coupons and to file such other papers or documents as may be necessary or advisable in order to have the claims of the Trustee (including any claim for the reasonable compensation,
expenses, disbursements and advances of the Trustee, its agents and counsel) and of the Holders allowed in such judicial proceeding, and 

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

42

and
any receiver, assignee, trustee, custodian, liquidator, sequestrator or other similar official in any such proceeding is hereby authorized by each Holder to make such payments to the Trustee, and
in the event that the Trustee shall consent to the making of such payments directly to the Holders, to pay to the Trustee any amount due it for the reasonable compensation, expenses, disbursements and
advances of the Trustee, its agents and counsel, and any other amounts due the Trustee under Section 607. 

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

          Section 505.  Trustee May Enforce Claims without Possession of Debt Securities or
Coupons.  

          All
rights of action and claims under this Indenture or the Debt Securities or coupons may be prosecuted and enforced by the Trustee without the possession of any of the Debt
Securities or coupons or the production thereof in any proceeding relating thereto, and any such proceeding instituted by the Trustee shall be brought in its own name, as trustee of an express trust,
and any recovery of judgment shall, after provision for the payment of the reasonable compensation, expenses, disbursements and advances of the Trustee, its agents and counsel, be for the ratable
benefit of the Holders of the Debt Securities and coupons in respect of which such judgment has been recovered. 

          Section 506.  Application of Money Collected.  

          Any
money collected by the Trustee pursuant to this Article shall be applied in the following order, at the date or dates fixed by the Trustee and, in case of the distribution of
such money on account of principal (and premium, if any) or interest, upon presentation of the Debt Securities or any coupons, or both, as the case may be, and the notation thereon of the payment if
only partially paid and upon surrender thereof if fully paid: 

          FIRST:
To the payment of all amounts due the Trustee under Section 607; 

          SECOND:    To
the payment of the amounts then due and unpaid for principal of (and premium, if any) and interest on the Debt Securities and any coupons, in respect of
which or for the benefit of which
such money has been collected ratably, without preference or priority of any kind, according to the amounts due and payable on such Debt Securities and any coupons for principal (and premium, if any)
and interest, respectively. The Holders of each series of Debt Securities denominated in Euro, any other composite currency or a Foreign Currency and any matured coupons relating thereto shall be
entitled to receive a ratable portion of the amount determined by the Exchange Rate Agent by converting the principal amount Outstanding of such series of Debt Securities and matured but unpaid
interest on such series of Debt Securities in the currency in which such series of Debt Securities is denominated into Dollars at the Exchange Rate as of the date of declaration of acceleration of the
Maturity of the Debt Securities; and 

          THIRD:      The
balance, if any, to the Person or Persons entitled thereto. 

43

          Section 507.  Limitation on Suits.  

          No
Holder of any Debt Securities of any series or any related coupons shall have any right to institute any proceeding, judicial or otherwise, with respect to this Indenture, or for
the appointment of a receiver or trustee, or for any other remedy hereunder, unless 

     (1)  such
Holder has previously given written notice to the Trustee of a continuing Event of Default with respect to the Debt Securities of such series; 

     (2)  the
Holders of not less than 25% in principal amount of the Outstanding Debt Securities of such series shall have made written request to the Trustee to institute
proceedings in respect of such Event of Default in its own name as Trustee hereunder; 

     (3)  such
Holder or Holders have offered to the Trustee reasonable indemnity against the costs, expenses and liabilities to be incurred in compliance with such request; 

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

     (5)  no
direction inconsistent with such written request has been given to the Trustee during such 60-day period by the Holders of a majority in principal
amount of the Outstanding Debt Securities of such series; 

it
being understood and intended that no one or more of such Holders shall have any right in any manner whatever by virtue of, or by availing of, any provision of this Indenture to affect, disturb or
prejudice the rights of any other such Holders, or to obtain or to seek to obtain priority or preference over any other of such Holders or to enforce any right under this Indenture, except in the
manner herein provided and for the equal and ratable benefit of all of such Holders. 

          Section 508.  Unconditional Right of Holders to Receive Principal, Premium and
Interest.  

          Notwithstanding
any other provision in this Indenture, the Holder of any Debt Security or coupon shall have the right which is absolute and unconditional to receive payment of the
principal of (and premium, if any) and (subject to Section 307) interest on such Debt Security or payment of such coupon on the respective Stated Maturity or Maturities expressed in such Debt
Security or coupon (or, in the case of redemption or repayment, on the Redemption Date or the Repayment Date, as the case may be) and to institute suit for the enforcement of any such payment, and
such right shall not be impaired without the consent of such Holder. 

          Section 509.  Restoration of Rights and Remedies.  

          If
the Trustee or any Holder has instituted any proceedings to enforce any right or remedy under this Indenture and such proceeding has been discontinued or abandoned for any reason,
or has been determined adversely to the Trustee or to such Holder, then and in every such case the 

44

Company, the Trustee and the Holders shall, subject to any determination in such proceeding, be restored severally and respectively to their former positions hereunder, and thereafter all rights and
remedies of the Trustee and the Holders shall continue as though no such proceeding had been instituted. 

          Section 510.  Rights and Remedies Cumulative.  

          Except
as otherwise provided in Section 306, no right or remedy herein conferred upon or reserved to the Trustee or to the Holders is intended to be exclusive of any other
right or remedy, and every right and remedy shall, to the extent permitted by law, be cumulative and in addition to every other right and remedy given hereunder or now or hereafter existing at law or
in equity or otherwise. The assertion or employment of any right or remedy hereunder, or otherwise, shall not prevent the concurrent assertion or employment of any other appropriate right or remedy. 

          Section 511.  Delay or Omission Not Waiver.  

          No
delay or omission of the Trustee or of any Holder of any Debt Security or coupon to exercise any right or remedy accruing upon any Event of Default shall impair any such right or
remedy or constitute a waiver of any such Event of Default or an acquiescence therein. Every right and remedy given by this Article or by law to the Trustee or to the Holders may be exercised from
time to time, and as often as may be deemed expedient, by the Trustee or by the Holders, as the case may be. 

          Section 512.  Control by Holders of Debt Securities.  

          The
Holders of a majority in principal amount of the Outstanding Debt Securities of any series shall have the right to direct the time, method and place of conducting any proceeding
for any remedy available to the Trustee or exercising any trust or power conferred on the Trustee with respect to the Debt Securities of such series,  provided, that 

     (1)  such
direction shall not be in conflict with any rule of law or with this Indenture; 

     (2)  subject
to the provisions of Section 601, the Trustee shall have the right to decline to follow any such direction if the Trustee in good faith shall, by a
Responsible Officer or Responsible Officers of the Trustee, determine that the proceedings so directed would be unjustly prejudicial to the Holders of Debt Securities of such series not joining in any
such direction; and 

     (3)  the
Trustee may take any other action deemed proper by the Trustee which is not inconsistent with such direction. 

          Section 513.  Waiver of Past Defaults.  

          The
Holders of not less than a majority in principal amount of the Outstanding Debt Securities of any series may on behalf of the Holders of all the Debt Securities of any such
series and 

45

any related coupons waive any past default hereunder with respect to such series and its consequences, except a default 

     (1)  in
the payment of the principal of (or premium, if any) or interest on any Debt Security of such series, or 

     (2)  in
respect of a covenant or provision hereof which under Article Nine cannot be modified or amended without the consent of the Holder of each Outstanding Debt
Security of such series affected. 

          Upon
any such waiver, such default shall cease to exist, and any Event of Default arising therefrom shall be deemed to have been cured, for every purpose of this Indenture; but no
such waiver shall extend to any subsequent or other default or impair any right consequent thereon. 

          Section 514.  Undertaking for Costs.  

          All
parties to this Indenture agree, and each Holder of any Debt Security or coupon by his acceptance thereof shall be deemed to have agreed, that any court may in its discretion
require, in any suit for the enforcement of any right or remedy under this Indenture, or in any suit against the Trustee for any action taken, suffered or omitted by it as Trustee, the filing by any
party litigant in such suit of an undertaking to pay the costs of such suit, and that such court may in its discretion assess reasonable costs, including reasonable attorneys' fees, against any party
litigant in such suit, having a due regard to the merits and good faith of the claims or defenses made by such party litigant, but the provisions of this Section shall not apply to any suit instituted
by the Company or the Trustee, to any suit instituted by any Holder, or group of Holders, holding in the aggregate more than 25% in principal amount of the Outstanding Debt Securities of any series,
or to any suit instituted by any Holder for the enforcement of the payment of the principal of (or premium, if any) or interest on any Debt Security or the payment of any coupons on or after the
respective Stated Maturity or Maturities expressed in such Debt Security or coupon (or, in the case of redemption or repayment, on or after the Redemption Date or Repayment Date, as the case may be). 

          Section 515.  Waiver of Stay or Extension Laws.  

          The
Company covenants (to the extent that it may lawfully do so) that it will not at any time insist upon, or plead, or in any manner whatsoever claim or take the benefit or
advantage of, any stay or extension law whenever enacted, now or at any time hereafter in force, which may affect the covenants or the performance of this Indenture; and the Company (to the extent
that it may lawfully do so) hereby expressly waives all benefits or advantage of any such law, and covenants that it will not hinder, delay or impede the execution of any power herein granted to the
Trustee, but will suffer and permit the execution of every such power as though no such law had been enacted. 

46

  ARTICLE SIX
  
  The Trustee         

          Section 601.  Certain Duties and Responsibilities.  

          Except
during the continuance of an Event of Default, the Trustee's duties and responsibilities under this Indenture shall be governed by the Trust Indenture Act. In case an Event of
Default has occurred and is continuing, the Trustee shall exercise the rights and powers vested in it by this Indenture, and shall use the same degree of care and skill in their exercise, as a prudent
man would exercise or use under the circumstances in the conduct of his own affairs. Notwithstanding the foregoing, no provision of this Indenture shall require the Trustee to expend or risk its own
funds or otherwise incur any financial liability in the performance of any of its duties hereunder, or in the exercise of any of its rights or powers, if it shall have reasonable grounds for believing
that repayment of such funds or adequate indemnity against such risk or liability is not reasonably assured to it. Whether or not therein expressly so provided, every provision of this Indenture
relating to the conduct or affecting the liability of or affording protection to the Trustee shall be subject to the provisions of this Section. 

          Section 602.  Notice of Default.  

          If
a default occurs hereunder with respect to Debt Securities of any series the Trustee shall transmit by mail to all Holders of Debt Securities of such series notice of such default
as and to the extent provided by the Trust Indenture Act; provided, however, that in the case of any default of the character specified in
Section 501(4) with respect to Debt Securities of such series no such notice to Holders shall be given until at least 30 days after the occurrence thereof. For the purpose of this
Section, the term "default" means any event which is, or after notice or lapse of time or both would become, an Event of Default with respect to Debt Securities of such series. 

          Section 603.  Certain Rights of Trustee.  

          Except
as otherwise provided in Section 601: 

          (a)  the
Trustee may rely and shall be protected in acting or refraining from acting upon any signature, resolution, certificate, statement, instrument, opinion,
report, notice, request, direction, consent, order, bond, debenture, note, coupon or other paper or document believed by it to be genuine and to have been signed or presented by the proper party or
parties; 

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

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

47

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

          (e)  the
Trustee shall be under no obligation to exercise any of the rights or powers vested in it by this Indenture at the request or direction of any of the Holders
of Debt Securities of such series or any related coupons pursuant to this Indenture, unless such Holders shall have offered to the Trustee reasonable security or indemnity against the costs, expenses
and liabilities which might be incurred by it in compliance with such request or direction; 

          (f)   the
Trustee shall not be bound to make any investigation into the facts or matters stated in any resolution, certificate, statement, instrument, opinion, report,
notice, request, direction, consent, order, bond, debenture, note, coupon, other evidence of indebtedness or other paper or document, but the Trustee, in its discretion, may make such further inquiry
or investigation into such facts or matters as it may see fit, and, if the Trustee shall determine to make such further inquiry or investigation, it shall be entitled to examine the books, records and
premises of the Company, personally or by agent or attorney, other than any such books or records containing information as to the affairs of the customers of the Company or any of its subsidiaries;  provided that the Trustee may examine such books and records relating to customers to the extent that such books and records contain information as to
any payments made to such customers in their capacity as Holders of Debt Securities; provided, further, that the Trustee shall treat all information regarding the Company which it receives pursuant to
this Indenture and its duties hereunder as confidential and shall not disclose such information unless necessary in order to fulfill its duties under this Indenture or the Trust Indenture Act; and 

          (g)  the
Trustee may execute any of the trusts or powers hereunder or perform any duties hereunder either directly or by or through agents or attorneys and the Trustee
shall not be responsible for any misconduct or negligence on the part of any agent or attorney appointed with due care by it hereunder; no Exchange Rate Agent, Global Exchange Agent, Depositary or
Paying Agent shall be deemed an agent of the Trustee and the Trustee shall not be responsible for any act or omission by any of them. 

          Section 604.  Not Responsible for Recitals or Issuance of Debt
Securities.  

          The
recitals contained herein and in the Debt Securities, except the Trustee's certificates of authentication, and in any coupons, and the information in any registration statement,
including all attachments thereto, except information provided by the Trustee therein, shall be taken as the statements of the Company, and the Trustee assumes no responsibility for their correctness.
The Trustee makes no representations as to the validity or sufficiency of this Indenture or of the Debt Securities of any series or any coupons. The Trustee shall not be accountable for the use or
application by the Company of any Debt Securities or the proceeds thereof. The Trustee shall not be responsible for and makes no representations as to the Company's ability or authority to issue
Bearer Securities or the lawfulness thereof. 

48

          Section 605.  May Hold Debt Securities or Coupons.  

          The
Trustee, any Paying Agent, the Security Registrar or any other agent of the Company or the Trustee, in its individual or any other capacity, may become the owner or pledgee of
Debt Securities and coupons, and, subject to Sections 608 and 613, may otherwise deal with the Company with the same rights it would have if it were not Trustee, Paying Agent, Security Registrar or
such agent. 

          Section 606.  Money Held in Trust.  

          Money
held by the Trustee or any Paying Agent in trust hereunder need not be segregated from other funds except to the extent required by law. Neither the Trustee nor any Paying
Agent shall be under any liability for interest on any money received by it hereunder except as otherwise agreed with the Company. 

          Section 607.  Compensation and Reimbursement.  

          The
Company agrees 

     (1)  to
pay to the Trustee from time to time reasonable compensation for all services rendered by it hereunder which shall have from time to time been separately agreed
to by the Company and the Trustee in writing (which compensation shall not be limited by any provision of law in regard to the compensation of a trustee of an express trust); 

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

     (3)  to
indemnify the Trustee for, and to hold it harmless against, any loss, liability or expense incurred without negligence or bad faith on its part, arising out of
or in connection with the acceptance or administration of this trust or performance of its duties hereunder, including the reasonable costs and expenses of defending itself against any claim or
liability in connection with the exercise or performance of any of its powers or duties hereunder. 

          The
Trustee shall promptly notify the Company of any claim for which it may seek indemnification pursuant to the provisions of this Indenture. The Company shall be entitled to
participate in, and to the extent that it shall wish, to assume the defense of such claim, with counsel satisfactory to the Trustee (and the Trustee shall cooperate in the defense thereof), and after
notice from the Company to the Trustee of the Company's election so to assume the defense thereof, the Company shall not be liable to the Trustee under this Indenture for any legal or other expenses
subsequently incurred by the Trustee in connection with the defense thereof other than reasonable costs of investigation. The Company shall not be obligated under any settlement agreement relating to
any claim under this Indenture to which it has not agreed in writing. 

49

          As security for the performance of the obligations of the Company under this Section the Trustee shall have a claim prior to the Debt Securities and any coupons upon all property and
funds held or collected by the Trustee as such, except funds held in trust for the payment of principal of (and premium, if any) or interest on particular Debt Securities or any coupons. 

          The
provisions of this Section 607 shall survive the resignation or removal of the Trustee and the termination of the Indenture. 

          Section 608.  Disqualification; Conflicting Interests.  

          If
the Trustee has or shall acquire any conflicting interest within the meaning of the Trust Indenture Act, the Trustee shall either eliminate such interest or resign, to the extent
and in the manner provided by, and subject to the provisions of, the Trust Indenture Act and this Indenture. To the extent permitted by such Act, the Trustee shall not be deemed to have a conflicting
interest with respect to Debt Securities of any series by virtue of being a trustee under this Indenture with respect to any particular series of Debt Securities. 

          Section 609.  Corporate Trustee Required; Eligibility.  

          There
shall at all times be a Trustee hereunder which shall be a corporation that is eligible pursuant to the Trust Indenture Act to act as such and organized and doing business
under the laws of the United States, any State thereof or the District of Columbia, authorized under such laws to exercise corporate trust powers, having a combined capital and surplus of at least
$5,000,000, and subject to supervision or examination by Federal or State authority; provided, however, that if Section 310(a) of the Trust
Indenture Act or the rules and regulations of the Commission under the Trust Indenture Act at any time permit a corporation organized and doing business under the laws of any other jurisdiction to
serve as trustee of an indenture qualified under the Trust Indenture Act, this Section 609 shall be automatically amended to permit a corporation organized and doing business under the laws of
any such other jurisdiction to serve as Trustee hereunder. If such corporation publishes reports of condition at least annually, pursuant to law or to the requirements of the aforesaid supervising or
examining authority, then for the purposes of this Section, the combined capital and surplus of such corporation shall be deemed to be its combined capital and surplus as set forth in its most recent
report of condition so published. If at any time the Trustee shall cease to be eligible in accordance with the provisions of this Section, it shall resign immediately in the manner and with the effect
hereinafter specified in this Article. 

          Section 610.  Resignation and Removal; Appointment of Successor.  

          (a)  No
resignation or removal of the Trustee and no appointment of a successor Trustee pursuant to this Article shall become effective until the acceptance of
appointment by the successor Trustee under Section 611. 

          (b)  The
Trustee may resign at any time with respect to the Debt Securities of one or more series by giving written notice thereof to the Company. If an instrument of
acceptance by a successor Trustee shall not have been delivered to the Trustee within 30 days after the giving of such notice of resignation, the resigning Trustee may petition any court of
competent jurisdiction for the appointment of a successor Trustee with respect to the Debt Securities of such series. 

50

          (c)  The Trustee may be removed at any time with respect to the Debt Securities of any series by Act of the Holders of a majority in principal amount of the
Outstanding Debt Securities of such series, delivered to the Trustee and to the Company. 

          (d)  If
at any time: 

     (1)  the
Trustee shall fail to comply with Section 608 with respect to the Debt Securities of any series after written request therefor by the Company or by any
Holder who has been a bona fide Holder of a Debt Security of such series for at least six months, or 

     (2)  the
Trustee shall cease to be eligible under Section 609 with respect to any series of Debt Securities and shall fail to resign after written request
therefor by the Company or by any such Holder, or 

     (3)  the
Trustee shall become incapable of acting with respect to any series of Debt Securities or a decree or order for relief by a court having jurisdiction in the
premises shall have been entered in
respect of the Trustee in an involuntary case under the Federal bankruptcy laws, as now or hereafter constituted, or any other applicable Federal or State bankruptcy, insolvency or similar law; or a
decree or order by a court having jurisdiction in the premises shall have been entered for the appointment of a receiver, custodian, liquidator, assignee, trustee, sequestrator or other similar
official of the Trustee or of its property or affairs, or any public officer shall take charge or control of the Trustee or of its property or affairs for the purpose of rehabilitation, conservation,
winding up or liquidation, or 

     (4)  the
Trustee shall commence a voluntary case under the Federal bankruptcy laws, as now or hereafter constituted, or any other applicable Federal or State
bankruptcy, insolvency or similar law or shall consent to the appointment of or taking possession by a receiver, custodian, liquidator, assignee, trustee, sequestrator or other similar official of the
Trustee or its property or affairs, or shall make an assignment for the benefit of creditors, or shall admit in writing its inability to pay its debts generally as they become due, or shall take
corporate action in furtherance of any such action, 

then,
in any such case, (i) the Company by a Board Resolution may remove the Trustee with respect to such series at any time or (ii) subject to Section 514, any Holder who has
been a bona fide Holder of a Debt Security of any series for at least six months may, on behalf of himself and all others similarly situated, petition any court of competent jurisdiction for the
removal of the Trustee for the Debt Securities of such series and the appointment of a successor Trustee. 

          (e)  If
the Trustee shall resign, be removed or become incapable of acting with respect to any series of Debt Securities, or if a vacancy shall occur in the office of
Trustee for any cause, with respect to the Debt Securities or one or more series, the Company, by a Board Resolution, shall promptly appoint a successor Trustee or Trustees with respect to the Debt
Securities of that or those series (it being understood that any such successor Trustee may be appointed with respect to the Debt Securities of one or more or all of such series and that at any time
there shall be only one Trustee with respect to the Debt Securities of any particular series) and shall comply with the applicable requirements of Section 611. If, within one year after such
resignation, removal or incapability, or the 

51

occurrence of such vacancy, a successor Trustee with respect to the Debt Securities of any series shall be appointed by Act of the Holders of a majority in principal amount of the Outstanding Debt
Securities of such series delivered to the Company and the retiring Trustee, the successor Trustee so appointed shall, forthwith upon its acceptance of such appointment, become the successor Trustee
with respect to the Debt Securities of such series and to that extent supersede the successor Trustee appointed by the Company. If no successor Trustee with respect to the Debt Securities of any
series
shall have been so appointed by the Company or the Holders and accepted appointment in the manner hereinafter provided, any Holder who has been a bona fide Holder of a Debt Security of such series for
at least six months may, subject to Section 514, on behalf of himself and all others similarly situated, petition any court of competent jurisdiction for the appointment of a successor Trustee
with respect to the Debt Securities of such series. 

          (f)   The
Company shall give notice of each resignation and each removal of the Trustee with respect to the Debt Securities of any series and each appointment of a
successor Trustee with respect to the Debt Securities of any series by mailing written notice of such event by first-class mail, postage prepaid, to the Holders of Registered Securities, if any, of
such series as their names and addresses appear in the Security Register and, if Debt Securities of such series are issuable as Bearer Securities, by publishing notice of such event once in an
Authorized Newspaper in each Place of Payment located outside the United States. Each notice shall include the name of the successor Trustee with respect to the Debt Securities of such series and the
address of its Corporate Trust Office. 

          Section 611.  Acceptance of Appointment by Successor.  

          (a)  In
the case of an appointment hereunder of a successor Trustee with respect to all Debt Securities, every such successor Trustee so appointed shall execute,
acknowledge and deliver to the Company and to the retiring Trustee an instrument accepting such appointment, and thereupon the resignation or removal of the retiring Trustee shall become effective and
such successor Trustee, without any further act, deed or conveyance, shall become vested with all the rights, powers, trusts and duties of the retiring Trustee; but, on request of the Company or the
successor Trustee, such retiring Trustee shall, upon payment of its charges, execute and deliver an instrument transferring to such successor Trustee all the rights, powers and trusts of the retiring
Trustee, and shall duly assign, transfer and deliver to such successor Trustee all property and money held by such retiring Trustee hereunder. 

          (b)  In
the case of the appointment hereunder of a successor Trustee with respect to the Debt Securities of one or more (but not all) series, the Company, the retiring
Trustee upon payment of its charges and each successor Trustee with respect to the Debt Securities of one or more series shall execute and deliver an indenture supplemental hereto wherein each
successor Trustee shall accept such appointment and which (1) shall contain such provisions as shall be necessary or desirable to transfer and confirm to, and to vest in, each successor Trustee
all the rights, powers, trusts and duties of the retiring Trustee with respect to the Debt Securities of that or those series to which the appointment of such successor Trustee relates, (2) if
the retiring Trustee is not retiring with respect to all Debt Securities, shall contain such provisions as shall be deemed necessary or desirable to confirm that all the rights, powers, trusts and
duties of the retiring Trustee with respect to the Debt Securities of that or those series as to which the retiring Trustee is not retiring shall continue to be vested in the retiring Trustee, and
(3) shall add to
or change any of the provisions of this Indenture as shall be necessary to provide for or facilitate the administration of the trusts hereunder by more than one Trustee, it being 

52

understood that nothing herein or in such supplemental indenture shall constitute such Trustees co-trustees of the same trust and that each such Trustee shall be trustee of a trust or
trusts hereunder separate and apart from any trust or trusts hereunder administered by any other such Trustee; and upon the execution and delivery of such supplemental indenture, the resignation or
removal of the retiring Trustee shall become effective to the extent provided therein and each such successor Trustee, without any further act, deed or conveyance, shall become vested with all the
rights, powers, trusts and duties of the retiring Trustee with respect to the Debt Securities of that or those series to which the appointment of such successor Trustee relates; but, on the request of
the Company or any successor Trustee, such retiring Trustee shall duly assign, transfer and deliver to such successor Trustee all property and money held by such retiring Trustee hereunder with
respect to the Debt Securities of that or those series to which the appointment of such successor Trustee relates. 

          (c)  Upon
request of any such successor Trustee, the Company shall execute any and all instruments for more fully and certainly vesting in and confirming to such
successor Trustee all such rights, powers and trusts referred to in paragraph (a) or (b) of this Section, as the case may be. 

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

          Section 612.  Merger, Conversion, Consolidation or Succession to
Business.  

          Any
corporation into which the Trustee may be merged or converted or with which it may be consolidated, or any corporation resulting from any merger, conversion or consolidation to
which the Trustee shall be a party, or any corporation succeeding to all or substantially all of the corporate trust business of the Trustee, shall, with the written approval of the Company, be the
successor of the Trustee hereunder, provided such corporation shall be otherwise qualified and eligible under this Article, without the executing or filing of any paper or any further act on the part
of any of the parties hereto. In case any Debt Securities shall have been authenticated, but not delivered, by the Trustee then in office, any successor by merger, conversion, consolidation or sale to
such authenticating Trustee may adopt such authentication and deliver the Debt Securities so authenticated with the same effect as if such
successor Trustee had itself authenticated such Debt Securities. In case any Debt Securities shall not have been authenticated by such predecessor Trustee, any such successor Trustee may authenticate
and deliver such Debt Securities, in either its own name or that of its predecessor Trustee, with the full force and effect which this Indenture provides for the certificate of authentication of the
Trustee. If the Trustee's successor by merger, conversion, consolidation or sale shall not have received the written approval of the Company, such successor shall resign within 20 days after
the merger, conversion, consolidation or sale and such vacancy in the office of the Trustee shall be filled in the manner specified in Section 610. 

          Section 613.  Preferential Collection of Claims Against Company.  

          If
and when the Trustee shall be or shall become a creditor, directly or indirectly, secured or unsecured, of the Company (or any other obligor upon the Debt Securities), the Trustee
shall be subject to the provisions of the Trust Indenture Act regarding collection of claims against the Company (or any such other obligor). 

53

 

          Section 614.  Authenticating Agent.  

          The
Trustee may upon Company request appoint one or more Authenticating Agents (including, without limitation, the Company or any Affiliate thereof) with respect to one or more
series of Debt Securities which shall be authorized on behalf of the Trustee in authenticating Debt Securities of such series in connection with the issue, delivery, registration of transfer,
exchange, partial redemption or repayment of such Debt Securities. Wherever reference is made in this Indenture to the authentication of Debt Securities by the Trustee or the Trustee's certificate of
authentication, such reference shall be deemed to include authentication on behalf of the Trustee by an Authenticating Agent and a certificate of authentication executed on behalf of the Trustee by an
Authenticating Agent. Each Authenticating Agent must be acceptable to the Company and, in the case of Registered Securities, must be a corporation organized and doing business under the laws of the
United States or of any State or the District of Columbia, having a combined capital surplus of at least $1,000,000, authorized under such laws to do a trust business and subject to supervision or
examination by Federal or State authorities, and in the case of Bearer Securities and an authenticating agent who is not organized and doing business under the laws of the United States or of any
State thereof or the District of Columbia, is subject to supervision or examination by the appropriate foreign authorities. 

          Any
corporation succeeding to the corporate agency business of an authenticating agent shall continue to be an authenticating agent without the execution or filing of any paper or
any further act on the part of the Trustee or such authenticating agent. 

          An
authenticating agent may at any time resign with respect to one or more series of Debt Securities by giving written notice of resignation to the Trustee and to the Company. The
Trustee may at any time terminate the agency of any authenticating agent with respect to one or more series of Debt Securities by giving written notice of termination to such authenticating agent and
to the Company. Upon receiving such a notice of resignation or upon such a termination, or in case at any time an authenticating agent shall cease to be eligible in accordance with the provisions of
this Section, the Trustee may appoint a successor authenticating agent. Any successor authenticating agent upon acceptance of its appointment hereunder shall become vested with all rights, powers and
duties of its predecessor hereunder, with like effect as if originally named as an authenticating agent herein. No successor authenticating agent shall be appointed unless eligible under the
provisions of this Section. 

          The
Trustee agrees to pay to each authenticating agent from time to time reasonable compensation for its services under this Section, and the Trustee shall be entitled to be
reimbursed for such payment, subject to the provisions of Section 607. 

          The
provisions of Sections 104, 111, 306, 309, 603, 604 and 605 shall be applicable to any authenticating agent. 

          Pursuant
to each appointment made under this Section, the Debt Securities of each series covered by such appointment may have endorsed thereon, in lieu of the Trustee's certificate
of authentication, an alternate certificate of authentication in substantially the following form: 

54

          This is one of the Debt Securities, of the series designated herein, described in the within-mentioned Indenture. 

    BANK
ONE TRUST COMPANY, N.A. 

    By
                                         
  

          As Authenticating Agent for the Trustee

    By
                                         
  

          Authorized Officer

  ARTICLE SEVEN
  
  Holders' Lists and Reports By Trustee and Company         

          Section 701.  Company to Furnish Trustee Names and Addresses of
Holders.  

          The
Company will furnish or cause to be furnished to the Trustee with respect to Debt Securities of each series for which it acts as Trustee: 

     (1)  semi-annually,
not later than May 15 and November 15 in each year, a list, in such form as the Trustee may reasonably require, of the
names and addresses of the Holders of Registered Securities as of the preceding May 1 or November 1, as the case may be, and 

     (2)  at
such other times as the Trustee may request in writing, within 30 days after the receipt by the Company of any such request, a list of similar form and
content as of a date not more than 15 days prior to the time such list is furnished; 

provided, however, that if and so long as the Trustee shall be the Security Registrar, no such list need be furnished. 

          Section 702.  Preservation of Information; Communications to Holders.  

          (a)  The
Trustee shall preserve, in as current a form as is reasonably practicable, the names and addresses of Holders of Registered Securities contained in the most
recent list furnished to the Trustee as provided in Section 701 and the names and addresses of Holders of Registered Securities received by the Trustee in its capacity as Paying Agent or
Security Registrar, if so acting. The Trustee may destroy any list furnished to it as provided in Section 701 upon receipt of a new list so furnished. The Trustee shall preserve for at least
two years the names and addresses of Holders of Bearer Securities filed with the Trustee by such Holders. 

55

          (b)  The rights of Holders to communicate with other Holders with respect to their rights under this Indenture or under the Debt Securities, and the corresponding
rights and privileges of the Trustee, shall be as provided by the Trust Indenture Act. 

          (c)  Every
Holder of Debt Securities or coupons, by receiving and holding the same, agrees with the Company and the Trustee that neither the Company nor the Trustee
shall be held accountable by reason of any disclosure of information as to the names and addresses of the Holders made pursuant to the Trust Indenture Act. 

          Section 703.  Reports by Trustee.  

          (a)  Within
60 days after May 15 of each year commencing with the first May 15 after the first issuance of Debt Securities pursuant to this
Indenture and at any other time required by the Trust Indenture Act, the Trustee shall transmit to Holders such reports concerning the Trustee and its actions under this Indenture and such other
matters as may be required pursuant to the Trust Indenture Act in the manner required by the Trust Indenture Act. 

          (b)  A
copy of each such report shall, at the time of such transmission to Holders, be filed by the Trustee with each stock exchange upon which any Debt Securities of
such series are listed, with the Commission and also with the Company. The Company will notify the Trustee when any series of Debt Securities are listed on any stock exchange. 

          Section 704.  Reports by Company.  

          The
Company shall file with the Trustee and the Commission, and transmit to Holders such information, documents and other reports, and such summaries thereof, as may be required
pursuant to the Trust Indenture Act at the time and in the manner pursuant to such Act; provided that such information, documents or reports required to
be filed with the Commission pursuant to Section 13 or
Section 15(d) of the Securities Exchange Act of 1934 shall be filed with the Trustee within 15 days after the same is so required to be filed with the Commission. 

  ARTICLE EIGHT
  
  Consolidation, Merger, Conveyance, Transfer or Lease         

          Section 801.  Company May Consolidate, etc. Only on Certain Terms.  

          The
Company shall not consolidate with or merge into any other corporation or convey, transfer or lease its properties and assets substantially as an entirety to any Person, and the
Company shall not permit any Person to consolidate with or merge into the Company, or convey, transfer or lease its properties and assets substantially as an entirety to the Company, unless: 

     (1)  in
case the Company shall consolidate with or merge into another corporation or convey, transfer or lease its properties and assets substantially as an entirety to
any Person, the corporation formed by such consolidation or into which the Company is merged or the 

56

Person which acquires by conveyance or transfer, or which leases, the properties and assets of the Company substantially as an entirety shall be a corporation organized and existing under the laws of
the United States of America, any political subdivision thereof or any State thereof and shall expressly assume, by an indenture supplemental hereto, executed and delivered to the Trustee, in form
satisfactory to the Trustee, the due and punctual payment of the principal of (and premium, if any) and interest (including all additional amounts, if any, payable pursuant to Section 1006) on
all the Debt Securities and the performance of every covenant of this Indenture on the part of the Company to be performed or observed; 

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

     (3)  except
in the case of a consolidation or merger of a Restricted Subsidiary with or into the Company, (a) the Holders of not less than a majority in
principal amount of the Outstanding Debt Securities of each series, by Act of the Holders delivered to the Company and the Trustee, shall have consented thereto, or (b)(i) immediately after
giving effect to such transaction, the corporation formed by or resulting or surviving therefrom or which shall have received such conveyance or transfer of properties and assets shall be permitted to
become liable for an increased amount of Secured Funded Debt under the provisions of paragraph (a) of Section 1008, and (ii) prior to such consolidation, merger, conveyance or
transfer there shall have been filed with the Trustee an Officers' Certificate stating that immediately after such consolidation, merger, conveyance or transfer such corporation may take the action
referred to in the foregoing clause (i); and 

     (4)  the
Company has delivered to the Trustee an Officers' Certificate and an Opinion of Counsel each stating that such consolidation, merger, conveyance, transfer or
lease and such supplemental indenture comply with this Article and that all conditions precedent herein provided for relating to such transaction have been met. 

          Section 802.  Successor Corporation Substituted.  

          Upon
any consolidation with or merger into any other corporation, or any conveyance, transfer or lease of the properties and assets of the Company substantially as an entirety in
accordance with Section 801, the successor corporation formed by such consolidation or into which the Company is merged or to which such conveyance, transfer or lease is made shall succeed to,
and be substituted for, and may exercise every right and power of, the Company under this Indenture with the same effect as if such successor had been named as the Company herein, and thereafter,
except in the case of a lease, the Company (which term for this purpose shall mean the Person named as the "Company" in the first paragraph of this instrument or any successor corporation which shall
theretofore have become such in the manner presented in this Article) shall be relieved of all obligations and covenants under this Indenture and the Debt Securities and any coupons. 

57

          Section 803.  Conveyance or Transfer to a Wholly-owned Restricted
Subsidiary.  

          Notwithstanding
the provisions of Sections 801 and 802, and without any requirement of complying with any of such provisions, the Company may convey or transfer its properties and
assets substantially as an entirety to another corporation organized and existing under the laws of the United States of America or any State or the District of Columbia which is lawfully entitled to
acquire the same; provided, however, that immediately after giving effect to such conveyance or transfer and to the receipt of the consideration
therefor (i) such other corporation shall be a Wholly-owned Restricted Subsidiary, and (ii) the Company shall be permitted to become liable for an increased amount of Secured Funded Debt
under the provisions of paragraph (a) of Section 1008, and prior to such conveyance or transfer there shall have been filed with the Trustee an Officers' Certificate to the effect that
the requirements of the preceding clauses (i) and (ii) will be complied with in connection with such conveyance or transfer. 

          Section 804.  Limitation on Lease of Properties as Entirety.  

          The
Company shall not lease its properties and assets substantially as an entirety to any Person. 

  ARTICLE NINE
  
  Supplemental Indentures         

          Section 901.  Supplemental Indentures without Consent of Holders.  

          Without
the consent of any Holders, the Company, when authorized by a Board Resolution, and the Trustee, at any time and from time to time, may enter into one or more indentures
supplemental hereto, in form satisfactory to the Trustee, for any of the following purposes: 

     (1)  to
evidence the succession of another corporation to the Company, and the assumption by such successor of the covenants of the Company herein and in the Debt
Securities contained; or 

     (2)  to
add to the covenants of the Company, for the benefit of the Holders of all or any series of Debt Securities (and if such covenants are to be for the benefit of
less than all series of Debt Securities, stating that such covenants are expressly being included solely for the benefit of such series) or any coupons, to convey, transfer, assign, mortgage or pledge
any property to or with the Trustee, or to surrender any right or power herein conferred upon the Company; or 

     (3)  to
add any additional Events of Default (and if such Events of Default are to be applicable to less than all series of Debt Securities, stating that such Events of
Default are expressly being included solely to be applicable to such series); or 

58

     (4)  to add to, change or eliminate any of the provisions of this Indenture to provide that Bearer Securities may be registrable as to principal, to change or eliminate
any restrictions on the payment of principal of (or premium, if any, on) Registered Securities or of principal of (or premium, if any, on) or any interest on Bearer Securities, to permit Bearer
Securities to be issued in exchange for Registered Securities of other authorized denominations or to permit or facilitate the issuance of Debt Securities in uncertificated form,  provided any such
action shall not adversely affect the interests of the Holders of Debt Securities of any series or any related coupons in any material
respect; or 

     (5)  to
change or eliminate any of the provisions of this Indenture, provided that any such change or elimination
(a) shall become effective only when there is no Debt Security Outstanding of any series created prior to the execution of such supplemental indenture which is entitled to the benefit of such
provisions or (b) shall not apply to any Debt Security Outstanding; or 

     (6)  to
establish the form or terms of Debt Securities of any series as permitted by Sections 201 and 301; or 

     (7)  to
secure the Debt Securities pursuant to the requirements of Section 1008 or otherwise; or 

     (8)  to
evidence and provide for the acceptance of appointment hereunder by a successor Trustee with respect to the Debt Securities of one or more series and to add to
or change any of the provisions of this Indenture as shall be necessary to provide for or facilitate the administration of the trusts hereunder by more than one Trustee, pursuant to the requirements
of Section 611(b); or 

     (9)  to
cure any ambiguity, to correct or supplement any provision herein which may be defective or inconsistent with any other provision herein, or to make any other
provisions with respect to matters or questions arising under this Indenture which shall not be inconsistent with any provision of this Indenture,  provided such other provisions shall not adversely
affect the interests of the Holders of Debt Securities of any series or any related coupons in any
material respect; or 

     (10) to
add to or change or eliminate any provision of this Indenture as shall be necessary or desirable in accordance with any amendments to the Trust Indenture Act,
provided such action shall not adversely affect the interest of Holders of Debt Securities of any series or any related coupons in any material respect. 

          Section 902.  Supplemental Indentures with Consent of Holders.  

          With
the consent of the Holders of not less than a majority in principal amount of the Outstanding Debt Securities of each series affected by such supplemental indenture, by Act of
said Holders delivered to the Company and the Trustee, the Company, when authorized by a Board Resolution, and the Trustee may enter into an indenture or indentures supplemental hereto for the purpose
of adding any provisions to or changing in any manner or eliminating any of the provisions of 

59

this Indenture or of modifying in any manner the rights under this Indenture of the Holders of such Debt Securities of such series and any related coupons; provided,
however, that no such supplemental indenture shall, without the consent of the Holder of each Outstanding Debt Security or coupon affected thereby, 

     (1)  change
the Stated Maturity of the principal or any installment of principal of, or any installment of interest on, any Debt Security, or reduce the principal
amount thereof or the interest thereon or any premium payable upon redemption or repayment thereof, or change any obligation of the Company to
pay additional amounts pursuant to Section 1006 (except as contemplated by Section 801(1) and permitted by Section 901(1)), or reduce the amount of the principal of an Original
Issue Discount Security that would be due and payable upon a declaration of acceleration of the Maturity thereof pursuant to Section 502, or change any Place of Payment, or the coin or currency
in which any Debt Security or the interest thereon or any coupon is payable, or impair the right to institute suit for the enforcement of any such payment on or after the Stated Maturity thereof (or,
in the case of redemption or repayment, on or after the Redemption Date or Repayment Date, as the case may be), or 

     (2)  reduce
the percentage in principal amount of the Outstanding Debt Securities of any series, the consent of whose Holders is required for any such supplemental
indenture, or the consent of whose Holders is required for any waiver (of compliance with certain provisions of this Indenture or certain defaults hereunder and their consequences) provided for in
this Indenture, or reduce the requirements of Section 1404 for quorum or voting, or 

     (3)  modify
any of the provisions of this Section, Section 513 or Section 1012, except to increase any such percentage or to provide that certain other
provisions of this Indenture cannot be modified or waived without the consent of the Holder of each Outstanding Debt Security affected thereby; provided,
however, that this clause shall not be deemed to require the consent of any Holder with respect to changes in the references to "the Trustee" and concomitant changes in this
Section and Section 1012, or the deletion of this proviso, in accordance with the requirements of Section 611(b) and 901(8), or 

     (4)  adversely
affect the right to repayment, if any, of Debt Securities of any series at the option of the Holders thereof. 

          A
supplemental indenture which changes or eliminates any covenant or other provision of this Indenture which has expressly been included solely for the benefit of one or more
particular series of Debt Securities, or which modifies the rights of the Holders of Debt Securities of such series with respect to such covenant or other provision, shall be deemed not to affect the
rights under this Indenture of the Holders of Debt Securities of any other series. 

          It
shall not be necessary for any Act of Holders of the Debt Securities under this Section to approve the particular form of any proposed supplemental indenture, but it shall be
sufficient if such Act shall approve the substance thereof. 

60

          Section 903.  Execution of Supplemental Indentures.  

          In
executing, or accepting the additional trusts created by, any supplemental indenture permitted by this Article or the modifications thereby of the trusts created by this
Indenture, the Trustee shall be entitled to receive, and (subject to Section 601) shall be fully protected in relying upon, an Opinion of Counsel stating that the execution of such supplemental
indenture is authorized or permitted by this Indenture. The Trustee may, but shall not be obligated to, enter into any such supplemental indenture which affects the Trustee's own rights, duties or
immunities under this Indenture or otherwise. 

          Section 904.  Effect of Supplemental Indentures.  

          Upon
the execution of any supplemental indenture under this Article, this Indenture shall be modified in accordance therewith, and such supplemental indenture shall form a
part of this Indenture for all purposes; and every Holder of Debt Securities theretofore or thereafter authenticated and delivered hereunder and of any coupons appertaining thereto shall be bound
thereby. 

          Section 905.  Conformity with Trust Indenture Act.  

          Every
supplemental indenture executed pursuant to this Article shall conform to the requirements of the Trust Indenture Act as then in effect. 

          Section 906.  Reference in Debt Securities to Supplemental Indentures.  

          Debt
Securities of any series authenticated and delivered after the execution of any supplemental indenture pursuant to this Article may, and shall if required by the Trustee, bear a
notation in form approved by the Trustee as to any matter provided for in such supplemental indenture. If the Company shall so determine, new Debt Securities of any series and any appurtenant coupons
so modified as to conform, in the opinion of the Trustee and the Company, to any such supplemental indenture may be prepared and executed by the Company and authenticated and delivered by the Trustee
in exchange for Outstanding Debt Securities of such series and any appurtenant coupons. 

  ARTICLE TEN
  
  Covenants         

          Section 1001.  Payment of Principal, Premium and Interest.  

          The
Company covenants and agrees for the benefit of each series of Debt Securities and any appurtenant coupons that it will duly and punctually pay the principal of (and premium, if
any) and interest on the Debt Securities in accordance with the terms of the Debt Securities, any appurtenant coupons and this Indenture. Any interest due on Bearer Securities on or before Maturity,
other than additional amounts, if any, payable as provided in Section 1006 in respect of principal of (or premium, if any, on) such a Debt Security, shall be payable only upon presentation and
surrender of the coupon or coupons for such interest installments as are evidenced thereby as they severally mature. 

61

          Section 1002.  Maintenance of Office or Agency.  

          The
Company will maintain in each Place of Payment for any series of Debt Securities an office or agency where Debt Securities (but, except as otherwise provided below, unless such
Place of Payment is located outside the United States, not Bearer Securities or coupons) may be presented or surrendered for payment, where Debt Securities may be surrendered for registration of
transfer or exchange and where notices and demands to or upon the Company in respect of the Debt Securities and this Indenture may be served. If Debt Securities of a series are issuable as Bearer
Securities, the Company will maintain, subject to any laws or regulations applicable thereto, an office or agency in a Place of Payment for such series which is located outside the United States where
Debt Securities of such series and the related coupons may be presented and surrendered for payment (including payment of any additional amounts payable on Debt Securities of such series pursuant to
Section 1006); provided, however, that if the Debt Securities of such series are listed on a stock exchange located outside the United States and
such stock exchange shall so require, the Company will maintain a Paying Agent in any required city located outside the United States, as the case may be, so long as the Debt Securities of such series
are listed on such exchange. The Company will give prompt written notice to the Trustee
of the location, and any change in the location, of any such office or agency. If at any time the Company shall fail to maintain any such required office or agency or shall fail to furnish the Trustee
with the address thereof, such presentations, surrenders, notices or demands may be made or served at Bank One Trust Company, N.A., 14 Wall Street, 8th Floor, Window 2, New York, New York
10005, and the Company hereby appoints Bank One Trust Company, N.A. its agent to receive all presentations, surrenders, notices and demands, except that Bearer Securities of that series and the
related coupons may be presented and surrendered for payment (including payment of any additional amounts payable on Bearer Securities of that series pursuant to Section 1006) at the place
specified for the purpose pursuant to Section 301(5). 

          No
payment of principal of, or premium, if any, or interest on Bearer Securities shall be made at any office or agency of the Company in the United States or by check mailed to any
address in the United States or by transfer to an account maintained with a bank located in the United States; provided, however, payment of principal
of and any premium and interest (including additional amounts payable in respect thereof) on any Bearer Security denominated in Dollars may be made at an office or agency of, and designated by, the
Company located in the United States if (but only if) payment of the full amount of such principal, premium, interest or additional amounts in Dollars at all offices outside the United States
maintained for the purpose by the Company in accordance with this Indenture is illegal or effectively precluded by exchange controls or other similar restrictions and the Trustee receives an Opinion
of Counsel that such payment within the United States is legal. Unless otherwise provided as contemplated by Section 301 with respect to any series of Debt Securities, at the option of the
Holder of any Bearer Security or related coupon, payment may be made by check in the currency designated for such payment pursuant to the terms of such Bearer Security presented or mailed to an
address outside the United States or by transfer to an account in such currency maintained by the payee with a bank located outside the United States. 

          The
Company may also from time to time designate one or more other offices or agencies (in or outside of such Place of Payment) where the Debt Securities of one or more series and
any related coupons (subject to the preceding paragraph) may be presented or surrendered for any or all 

62

such purposes, and may from time to time rescind such designations; provided, however, that no such designation or rescission shall in any manner
relieve the Company of its obligation to maintain an office or agency in each Place of Payment for any series of Debt Securities for such purposes. The Company will give prompt written notice to the
Trustee of any such designation and any change in the location of any such other office or agency. 

          Section 1003.  Money for Debt Securities Payments to Be Held in Trust.  

          If
the Company shall at any time act as its own Paying Agent with respect to any series of Debt Securities, it will, on or before each due date of the principal of (and premium, if
any) or interest on any of the Debt Securities of such series, segregate and hold in trust for the benefit of the Persons entitled thereto a sum sufficient to pay the principal (and premium, if any)
or interest so becoming due until such sums shall be paid to such Persons or otherwise disposed of as herein provided, and will promptly notify the Trustee of its action or failure so to act. 

          Whenever
the Company shall have one or more Paying Agents with respect to any series of Debt Securities, it will, on or before each due date of the principal of (and premium, if any)
or interest on any of the Debt Securities of such series, deposit with a Paying Agent a sum sufficient to pay the principal (and premium, if any) or interest so becoming due, such sum to be held in
trust for the benefit of the Persons entitled to such principal, premium or interest, and (unless such Paying Agent is the Trustee) the Company will promptly notify the Trustee of its action or
failure so to act. 

          The
Company will cause each Paying Agent with respect to any series of Debt Securities other than the Trustee to execute and deliver to the Trustee an instrument in which such Paying
Agent shall agree with the Trustee, subject to the provisions of this Section, that such Paying Agent will 

     (1)  hold
all sums held by it for the payment of the principal of (and premium, if any) or interest on Debt Securities of such series in trust for the benefit of the
Persons entitled thereto until such sums shall be paid to such Persons or otherwise disposed of as herein provided; 

     (2)  give
the Trustee notice of any default by the Company (or any other obligor upon the Debt Securities of such series or any appurtenant coupons) in the making of
any payment of principal of (and premium, if any) or interest on the Debt Securities of such series; and 

     (3)  at
any time during the continuance of any such default, upon the written request of the Trustee, forthwith pay to the Trustee all sums so held in trust by such
Paying Agent. 

          The
Company may at any time, for the purpose of terminating its obligations under this Indenture with respect to Debt Securities of any series or for any other purpose, pay, or by
Company Order direct any Paying Agent to pay, to the Trustee all sums held in trust by the Company or such Paying Agent, such sums to be held by the Trustee upon the same trusts as those upon which
such sums were held by the Company or such Paying Agent; and, upon such payment by any Paying Agent to the Trustee, such Paying Agent shall be released from all further liability with respect to such
money. 

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          Any
principal and interest received on the Government Obligations deposited with the Trustee or any money deposited with the Trustee or any Paying Agent, or then held by the Company,
in trust for the payment of the principal of (and premium, if any) or interest on any Debt Security of any series or any money on deposit with the Trustee or any Paying Agent representing amounts
deducted from the Redemption Price or Repayment Price with respect to unmatured coupons not presented upon redemption or exercise of the Holder's option for repayment pursuant to Section 1106
or 1303 and remaining unclaimed for two years after such principal (and premium, if any) or interest has become due and payable shall be paid to the Company on Company Request, or (if then held by the
Company) shall be discharged from such trust; and the Holder of such Debt Security or any coupon appertaining thereto shall thereafter, as an unsecured general creditor, look only to the Company for
payment thereof, and all liability of the Trustee or such Paying Agent with respect to such trust money (including the principal and interest received on Government Obligations deposited with the
Trustee), and all liability of the Company as trustee thereof, shall thereupon cease; provided, however, that the Trustee or such Paying Agent, before
being required to make any such repayment, may at the expense of the Company cause to be published once, in an Authorized Newspaper of general circulation in the Borough of Manhattan, The City of New
York, and each Place of Payment or mailed to each such Holder, or both, notice that such money remains unclaimed and that, after a date specified therein, which shall not be less than 30 days
from the date of such publication or mailing, any unclaimed balance of such money then remaining will be repaid to the Company. 

          Section 1004.  Corporate Existence.  

          Subject
to Article Eight, the Company will do or cause to be done all things necessary to preserve and keep in full force and effect its corporate existence, rights (charter and
statutory) and franchises, provided, however, that the Company shall not be required to preserve any such right or franchise if the Board of Directors
shall determine that the preservation thereof is no longer desirable in the conduct of the business of the Company and that the loss thereof is not disadvantageous in any material respect to the
Holders. 

          Section 1005.  Maintenance of Properties.  

          The
Company will cause all properties used or useful in the conduct of its business or the business of any Subsidiary to be maintained and kept in good condition, repair and working
order and supplied with all necessary equipment and will cause to be made all necessary repairs, renewals, replacements, betterments and improvements thereof, all as in the judgment of the Company may
be necessary so
that the business carried on in connection therewith may be properly and advantageously conducted at all times, provided, however, that nothing in this
Section shall prevent the Company from discontinuing the operation or maintenance of any of such properties if such discontinuance is, in the judgment of the Company, desirable in the conduct of its
business or the business of any Subsidiary and not disadvantageous in any material respect to the Holders. 

          Section 1006.  Payment of Additional Amounts.  

          If
the Debt Securities of a series provide for the payment of additional amounts, the Company will pay to the Holder of any Debt Security of any series or any coupon appertaining
thereto 

64

additional amounts upon the terms and subject to the conditions provided therein. Whenever in this Indenture there is mentioned, in any context, the payment of the principal of (or premium, if any) or
interest on, or in respect of, any Debt Security of any series or the net proceeds received on the sale or exchange of any Debt Security of any series, such mention shall be deemed to include mention
of the payment of additional amounts provided for in the terms of such Debt Securities and this Section to the extent that, in such context, additional amounts are, were or would be payable in respect
thereof pursuant to the provisions of this Section and express mention of the payment of additional amounts (if applicable) in any provisions hereof shall not be construed as excluding additional
amounts in those provisions hereof where such express mention is not made. 

          If
the Debt Securities of a series provide for the payment of additional amounts, at least 10 days prior to the first Interest Payment Date with respect to that series of Debt
Securities (or if the Debt Securities of that series will not bear interest prior to Maturity, the first day on which a payment of principal (and premium, if any) is made), and at least 10 days
prior to each date of payment of principal (and premium, if any) or interest if there has been any change with respect to the matters set forth in the below-mentioned Officers' Certificate, the
Company will furnish the Trustee and the Company's principal Paying Agent or Paying Agents, if other than the Trustee, with an Officers' Certificate instructing the Trustee and such Paying Agent or
Paying Agents whether such payment of principal of (and premium, if any) or interest on the Debt Securities of that series shall be made to Holders of Debt Securities of that series or the related
coupons who are United States Aliens without withholding for or on account of any tax, assessment or other governmental charge described in the Debt Securities of that series. If any such withholding
shall be required, then such Officers' Certificate shall specify by country the amount, if any, required to be withheld on such payments to such Holders of Debt Securities or coupons and the Company
will pay to the Trustee or such Paying Agent the additional
amounts, if any, required by the terms of such Debt Securities and the first paragraph of this Section. The Company covenants to indemnify the Trustee and any Paying Agent for, and to hold them
harmless against, any loss, liability or expense reasonably incurred without negligence or bad faith on their part arising out of or in connection with actions taken or omitted by any of them in
reliance on any Officers' Certificate furnished pursuant to this Section. 

          Section 1007.  Payment of Taxes and Other Claims.  

          The
Company will pay or discharge or cause to be paid or discharged, before the same shall become delinquent, (1) all taxes, assessments and governmental charges levied or
imposed upon the Company or any Subsidiary or upon the income, profits or property of the Company or any Subsidiary, and (2) all lawful claims for labor, materials and supplies which, if
unpaid, might by law become a lien upon the property of the Company or any Subsidiary, provided, however, that the Company shall not be required to pay
or discharge or cause to be paid or discharged any such tax, assessment, charge or claim whose amount, applicability or validity is being contested in good faith by appropriate proceedings. 

          Section 1008.  Restriction on the Creation of Secured Funded Debt.  

          (a)  The
Company will not, and will not permit any Restricted Subsidiary to, issue, assume or guarantee, incur or create any Secured Funded Debt unless immediately
thereafter the sum of (i) the aggregate principal amount of all outstanding Secured Funded Debt of the Company and its 

65

Restricted Subsidiaries (exclusive of any Secured Funded Debt permitted by paragraph (b) of this Section) plus (ii) the aggregate amount of all Attributable Debt of the Company and its
Restricted Subsidiaries in respect of sale and leaseback transactions (as defined in Section 1009) does not exceed 15% of Consolidated Net Tangible Assets. 

          (b)  Compliance
with the requirements of Section 1008(a) shall be determined without regard to (i) Secured Funded Debt of a Restricted Subsidiary owing
to the Company or a Wholly-owned
Restricted Subsidiary, (ii) Secured Funded Debt resulting from the Mortgage of property of the Company or any Restricted Subsidiary in favor of the United States, or any State thereof, or any
department, agency or instrumentality of the United States or any State thereof, to secure partial, progress, advance or other payments to the Company or any Restricted Subsidiary pursuant to the
provisions of any contract or statute, (iii) Secured Funded Debt resulting from Mortgages on property of, or on any shares of stock or Indebtedness of, any corporation existing at the time such
corporation becomes a Subsidiary, (iv) subject to Section 801, Secured Funded Debt resulting from Mortgages on property, shares of stock or Indebtedness existing at the time of
acquisition thereof (including acquisition through merger or consolidation) or to secure the payment of all or any part of the purchase price or construction cost thereof or to secure any indebtedness
incurred prior to, at the time of, or within 120 days after, the acquisition of such property or shares or Indebtedness or the completion of any such construction for the purpose of financing
all or any part of the purchase price or construction cost thereof, (v) Secured Funded Debt resulting from Mortgages incurred or assumed in connection with an issuance of revenue bonds the
interest on which is exempt from Federal income tax pursuant to section 103(b) of the Internal Revenue Code of 1986, as amended (or any predecessor or successor provision thereof), or
(vi) any extension, renewal or refunding (or successive extensions, renewals or refundings), in whole or in part (but without increase in amount), of any Secured Funded Debt (and of any
Mortgage securing the same) permitted by the provisions of paragraph (a) of this Section 1008 or of any Secured Funded Debt (and of any Mortgage securing the same) outstanding at
January 29, 2000 of those Subsidiaries which will constitute Restricted Subsidiaries upon the execution and delivery of this Indenture as originally executed or of any Secured Funded Debt (and
of any Mortgage securing the same) of any corporation outstanding at the time such corporation became a Restricted Subsidiary, provided that the
Mortgage securing such extended, renewed or refunded Secured Funded Debt is limited to the same property (plus improvements thereon) that secured the Secured Funded Debt so extended, renewed or
refunded immediately prior thereto. 

          (c)  Notwithstanding
the foregoing paragraphs of this Section, the Company or any Restricted Subsidiary may issue, assume, guarantee, incur or create Secured Funded
Debt not permitted by such paragraphs if the Company shall first make effective provision whereby the Debt Securities (together with, if the Company shall so determine, any other Indebtedness or any
obligations of the Company or such Restricted Subsidiary then existing or thereafter created ranking equally with the Debt Securities, including guarantees of Indebtedness or obligations of others)
shall be secured equally and ratably with (or prior to) such Secured Funded Debt, so long as such Secured Funded Debt shall be so secured. If the Company shall hereafter make provision to secure the
Debt Securities equally and ratably with (or prior to) any other Indebtedness or obligations pursuant to this paragraph (c), then (i) the Company will promptly deliver to the Trustee an
Officers' Certificate and Opinion of Counsel stating that this paragraph (c) has been complied with and that any instruments executed by the Company or any Restricted Subsidiary in the
performance of this paragraph (c) comply with the requirements hereof, and (ii) the Trustee is hereby authorized to enter into an indenture or agreement 

66

supplemental hereto and to take such action, if any, as it may deem advisable to enable it to enforce the rights of the Holders of the Debt Securities as so secured. 

          Section 1009.  Restriction on Sale and Lease-Back
Transactions.  

          The
Company will not itself, and it will not permit any Restricted Subsidiary to, enter into any arrangement with any bank, insurance company or other lender or investor (not
including the Company or any Restricted Subsidiary) or to which any such lender or investor is a party, providing for the leasing by the Company or any Restricted Subsidiary for a period, including
renewals, in excess of three years of any Operating Property which has been or is to be sold or transferred, more than 120 days after the acquisition thereof or the completion of construction
and commencement of full operation thereof, by the Company or any Restricted Subsidiary to such lender or investor or to any person to whom funds have been or are to be advanced by such lender or
investor on the security of such Operating Property (herein referred to as a "sale and leaseback transaction") unless either: 

     (1)  the
Company or such Restricted Subsidiary could create Secured Funded Debt pursuant to Section 1008 on the Operating Property to be leased back in an amount
equal to the Attributable Debt with respect to such sale and leaseback transaction without equally and ratably securing the Debt Securities, or 

     (2)  the
Company, within 120 days after the sale or transfer shall have been made by the Company or by any such Restricted Subsidiary, applies an amount equal to
the greater of (i) the net proceeds of the sale of the Operating Property sold and leased back pursuant to such arrangement or (ii) the fair market value of the Operating Property so
sold and leased back at the time of entering into such arrangements (as determined by any two of the following: the Chairman of the Board of the Company, its Chief Executive Officer, its President,
any Vice President of the Company, its Treasurer and its Controller) to the retirement of Secured Funded Debt of the Company, provided that the amount
to be applied to the retirement of Secured Funded Debt of the Company shall be reduced by (a) the principal amount of any Debt Securities delivered within 120 days after such sale to the
Trustee for retirement and cancellation, and (b) the principal amount of Secured Funded Debt voluntarily retired by the Company within 120 days after such sale. Notwithstanding the
foregoing, no retirement referred to in this clause (2) may be effected by payment at maturity or pursuant to any mandatory sinking fund payment or any mandatory prepayment provision. 

          Section 1010.  Restriction on Permitting Unrestricted Subsidiaries to become Restricted
Subsidiaries.  

          (a)  The
Company will not permit any Unrestricted Subsidiary to be designated as a Restricted Subsidiary unless such Subsidiary has outstanding no Secured Funded Debt
and/or Attributable Debt except such Secured Funded Debt and Attributable Debt as the Company could permit it to become liable for immediately after becoming a Restricted Subsidiary under the
provisions of Section 1008. 

          (b)  Promptly
after the adoption of any Board Resolution designating a Restricted Subsidiary as an Unrestricted Subsidiary or an Unrestricted Subsidiary as a
Restricted Subsidiary, a 

67

copy thereof shall be filed with the Trustee, together, in the case of the designation of an Unrestricted Subsidiary as a Restricted Subsidiary, with an Officers' Certificate stating that the
provisions of this Section have been complied with in connection with such designation. 

          Section 1011.  Officer's Certificate as to Default.  

          The
Company will furnish to the Trustee not more than 120 days after the end of the Company's fiscal year in each year (beginning with 2001) a brief certificate from the
principal executive, financial or accounting officer or treasurer or controller of the Company as to his or her knowledge of the Company's compliance with all conditions and covenants under this
Indenture (such compliance to be determined without regard to any period of grace or requirement of notice provided under this Indenture), and, if he or she has knowledge of any default, specifying
each such default of which the signer has knowledge and the nature thereof. 

          Section 1012.  Waiver of Certain Covenants.  

          The
Company may omit in any particular instance to comply with any covenant or condition set forth in Sections 1004, 1005 and 1007 to 1010 inclusive with respect to the Debt
Securities of any series if, before the time for such compliance the Holders of at least a majority in principal amount of the Debt Securities at the time Outstanding shall, by Act of such Holders,
either waive such compliance in such instance or generally waive compliance with such covenant or condition, but no such waiver shall
extend to or affect such covenant or condition except to the extent so expressly waived, and, until such waiver shall become effective, the obligations of the Company and the duties of the Trustee in
respect of any such covenant or condition shall remain in full force and effect. 

  ARTICLE ELEVEN
  
  Redemption of Debt Securities         

          Section 1101.  Applicability of Article.  

          Debt
Securities of any series which are redeemable before their Stated Maturity shall be redeemable in accordance with their terms and (except as otherwise specified as contemplated
by Section 301 for Debt Securities of any series) in accordance with this Article. 

          Section 1102.  Election to Redeem; Notice to Trustee.  

          The
election of the Company to redeem any Debt Securities shall be evidenced by a Board Resolution. In case of any redemption at the election of the Company of less than all of the
Debt Securities of any series, the Company shall, at least 45 days prior to the Redemption Date fixed by the Company (unless a shorter notice shall be satisfactory to the Trustee), notify the
Trustee of such Redemption Date and of the principal amount and the tenor and terms of the Debt Securities of any series to be redeemed. In the case of any redemption of Debt Securities prior to the
expiration of any restriction on such redemption provided in the terms of such Debt Securities or elsewhere in this 

68

Indenture, the Company shall furnish the Trustee with an Officers' Certificate evidencing compliance with such restriction. 

          Section 1103.  Selection by Trustee of Debt Securities to be Redeemed.  

          Except
as otherwise specified as contemplated by Section 301 for Debt Securities of any series, if less than all the Debt Securities of any series with like tenor and terms
are to be redeemed, the particular Debt Securities to be redeemed shall be selected not more than 60 days prior to the Redemption Date by the Trustee, from the Outstanding Debt Securities of
such series with like tenor and terms not previously called for redemption, by such method as the Trustee shall deem fair and appropriate and which may provide for the selection for redemption of
portions (equal to the minimum authorized denomination for Debt Securities of such series or any integral multiple thereof which is also an authorized denomination) of the principal amount of
Registered Securities or Bearer Securities (if issued in more than one authorized denomination) of such series of a denomination larger than the minimum authorized denomination for Debt Securities of
such series. 

          The
Trustee shall promptly notify the Company in writing of the Debt Securities selected for redemption and, in the case of any Debt Securities selected for partial redemption, the
principal amount thereof to be redeemed. 

          For
all purposes of this Indenture, unless the context otherwise requires, all provisions relating to the redemption of Debt Securities shall relate, in the case of any Debt Security
redeemed or to be redeemed only in part, to the portion of the principal amount of such Debt Security which has been or is to be redeemed. 

          Section 1104.  Notice of Redemption.  

          Notice
of redemption shall be given in the manner provided in Section 106 not less than 30 nor more than 60 days prior to the Redemption Date, to each Holder of Debt
Securities to be redeemed. 

          All
notices of redemption shall state: 

     (1)  the
Redemption Date, 

     (2)  the
Redemption Price, 

     (3)  if
less than all Outstanding Debt Securities of any series are to be redeemed, the identification (and, in the case of partial redemption, the principal amounts)
of the particular Debt Securities to be redeemed, 

     (4)  that
on the Redemption Date the Redemption Price will become due and payable upon each such Debt Security to be redeemed, and that interest thereon shall cease to
accrue on and after said date, 

69

     (5)  the Place or Places of Payment where such Debt Securities, together in the case of Bearer Securities with all coupons, if any, appertaining thereto maturing after
the Redemption Date, are to be surrendered for payment of the Redemption Price, 

     (6)  that
Bearer Securities may be surrendered for payment only at such place or places which are outside the United States, except as otherwise provided in
Section 1002, 

     (7)  that
the redemption is for a sinking fund, if such is the case, and 

     (8)  the
CUSIP number, if any. 

          A
notice of redemption published as contemplated by Section 106 need not identify particular Registered Securities to be redeemed. 

          Notice
of redemption of Debt Securities to be redeemed at the election of the Company shall be given by the Company, or, at the Company's request, by the Trustee in the name and at
the expense of the Company. 

          Section 1105.  Deposit of Redemption Price.  

          On
or prior to any Redemption Date, the Company shall deposit with the Trustee or with a Paying Agent (or, if the Company is acting as its own Paying Agent, segregate and hold in
trust as provided in Section 1003) an amount of money and/or Government Obligations the payments of principal and interest on which when due (and without reinvestment) will provide money on or
prior to the Redemption Date in such amounts as will (together with any money irrevocably deposited in trust with the Trustee, without investment) be sufficient to pay the Redemption Price of, and
(except if the Redemption Date shall be an Interest Payment Date) accrued interest on, all the Debt Securities or portions thereof which are to be redeemed on that date;  provided, however, that deposits
with respect to Bearer Securities shall be made with a Paying Agent or Paying Agents located outside the United States
except as otherwise provided in Section 1002, unless otherwise specified as contemplated by Section 301. 

          Section 1106.  Debt Securities Payable on Redemption Date.  

          Notice
of redemption having been given as aforesaid, the Debt Securities to be redeemed shall, on the Redemption Date, become due and payable at the Redemption Price therein
specified and from and after such date (unless the Company shall default in the payment of the Redemption Price and accrued interest) such Debt Securities shall cease to bear interest and the coupons
for such interest appertaining to any Bearer Securities so to be redeemed, except to the extent provided below, shall be void. Upon surrender of any such Debt Security for redemption in accordance
with said notice, such Debt Security shall be paid by the Company at the Redemption Price, together with accrued interest to the Redemption Date; provided,
however, that installments of interest on Bearer Securities whose Stated Maturity is on or prior to the Redemption Date shall be payable only upon presentation and surrender of
coupons for such interest (at an office or agency located outside the United States except as otherwise provided in Section 1002), and provided
further, that installments of interest on Registered Securities whose Stated Maturity is on or prior to the Redemption Date shall be 

70

payable to the Holders of such Debt Securities, or one or more Predecessor Securities, registered as such on the relevant Record Dates according to their terms and the provisions of
Section 307. 

          If
any Bearer Security surrendered for redemption shall not be accompanied by all appurtenant coupons maturing after the Redemption Date, such Bearer Security may be paid after
deducting from the Redemption Price an amount equal to the face amount of all such missing coupons, or the surrender of such missing coupon or coupons may be waived by the Company and the Trustee if
there be furnished to them such security or indemnity as they may require to save each of them and any Paying Agent harmless. If thereafter the Holder of such Bearer Security shall surrender to the
Trustee or any Paying Agent any such missing coupon in respect of which a deduction shall have been made from the Redemption Price, such Holder shall be entitled to receive the amount so deducted
without interest thereon; provided, however, that interest represented by coupons shall be payable only upon presentation and surrender of those coupons
at an office or agency located outside of the United States except as otherwise provided in Section 1002. 

          If
any Debt Security called for redemption shall not be so paid upon surrender thereof for redemption, the principal (and premium, if any) shall, until paid, bear interest from the
Redemption Date at the rate prescribed therefor in the Debt Security. 

          Section 1107.  Debt Securities Redeemed in Part.  

          Any
Registered Security which is to be redeemed only in part shall be surrendered at a Place of Payment therefor (with, if the Company, the Security Registrar or the Trustee so
requires, due endorsement by, or a written instrument of transfer in form satisfactory to the Company, the Security Registrar and the Trustee duly executed by, the Holder thereof or his attorney duly
authorized in writing), and the Company shall execute, and the Trustee shall authenticate and deliver to the Holder of such Debt Security without service charge, a new Registered Security or
Registered Securities of the same series and of like tenor and terms, of any authorized denominations as requested by such Holder in aggregate principal amount equal to and in exchange for the
unredeemed portion of the principal of the Debt Security so surrendered. 

  ARTICLE TWELVE
  
  Sinking Funds         

          Section 1201.  Applicability of Article.  

          The
provisions of this Article shall be applicable to any sinking fund for the retirement of Debt Securities of a series except as otherwise specified as contemplated by
Section 301 for Debt Securities of such series. 

          The
minimum amount of any sinking fund payment provided for by the terms of Debt Securities of any series is herein referred to as a "mandatory sinking fund payment", and any payment
in excess of such minimum amount provided for by the terms of Debt Securities of any series is herein referred to an "optional sinking fund payment". If provided for by the terms of Debt Securities of
any 

71

series, the amount of any sinking fund payment may be subject to reduction as provided in Section 1202. Each sinking fund payment shall be applied to the redemption of Debt Securities of any
series as provided for by the terms of Debt Securities of such series. 

          Section 1202.  Satisfaction of Sinking Fund Payments with Debt
Securities.  

          The
Company (1) may deliver Outstanding Debt Securities of a series (other than any previously called for redemption), together in the case of any Bearer Securities of such
series with all unmatured coupons appertaining thereto, and (2) may apply as a credit Debt Securities of a series which have been redeemed either at the election of the Company pursuant to the
terms of such Debt Securities or through the application of permitted optional sinking fund payments pursuant to the terms of such Debt Securities, in each case in satisfaction of all or any part of
any sinking fund payment with respect to the Debt Securities of such series required to be made pursuant to the terms of such Debt Securities as provided for by the terms of such series;  provided that
such Debt Securities have not been previously so credited. Such Debt Securities shall be received and credited for such purpose by the
Trustee at the Redemption Price specified in such Debt Securities for redemption through operation of the sinking fund and the amount of such sinking fund payment shall be reduced accordingly. If as a
result of the delivery or credit of Debt Securities in lieu of cash payments pursuant to this Section 1202, the principal amount of Debt Securities to be redeemed in order to exhaust the
aforesaid cash payment shall be less than $100,000, the Trustee need not call Debt Securities for redemption, except upon Company Request, and such cash payment shall be held by the Trustee or a
Paying Agent and applied to the next succeeding sinking fund payment, provided, however, that the Trustee or such Paying Agent shall at the request of
the Company from time to time pay over and deliver to the Company any cash payment so being held by the Trustee or such Paying Agent upon delivery by the Company to the Trustee of Debt
Securities purchased by the Company having an unpaid principal amount equal to the cash payment requested to be released to the Company. 

          Section 1203.  Redemption of Debt Securities for Sinking Fund.  

          Not
less than 45 days prior to each sinking fund payment date for any series of Debt Securities (unless a shorter period shall be satisfactory to the Trustee), the Company
will deliver to the Trustee an Officers' Certificate specifying the amount of the next ensuing sinking fund payment for that series pursuant to the terms of that series, the portion thereof, if any,
which is to be satisfied by payment of cash, the portion thereof, if any, which is to be satisfied by crediting Debt Securities of that series pursuant to Section 1202 and the basis for any
such credit and, prior to or concurrently with the delivery of such Officers' Certificate, will also deliver to the Trustee any Debt Securities to be so credited and not theretofore delivered to the
Trustee. Not less than 30 days (unless a shorter period shall be satisfactory to the Trustee) before each such sinking fund payment date the Trustee shall select the Debt Securities to be
redeemed upon such sinking fund payment date in the manner specified in Section 1103 and cause notice of the redemption thereof to be given in the name of and at the expense of the Company in
the manner provided in Section 1104. Such notice having been duly given, the redemption of such Debt Securities shall be made upon the terms and in the manner stated in Sections 1105, 1106 and
1107. 

72

  ARTICLE THIRTEEN
  
  Repayment at the Option of Holders         

          Section 1301.  Applicability of Article.  

          Debt
Securities of any series which are repayable at the option of the Holders thereof before their Stated Maturity shall be repaid in accordance with their terms and (except as
otherwise specified pursuant to Section 301 for Debt Securities of such series) in accordance with this Article. 

          Section 1302.  Repayment of Debt Securities.  

          Each
Debt Security which is subject to repayment in whole or in part at the option of the Holder thereof on a Repayment Date shall be repaid at the applicable Repayment Price
together with interest accrued to such Repayment Date as specified pursuant to Section 301. 

          Section 1303.  Exercise of Option; Notice.  

          Each
Holder desiring to exercise such Holder's option for repayment shall, as conditions to such repayment, surrender the Debt Security to be repaid in whole or in part together with
written notice of the exercise of such option at any office or agency of the Company in a Place of Payment, not less than 30 nor more than 45 days prior to the Repayment Date;  provided, however,
that surrender of Bearer Securities together with written notice of exercise of such option shall be made at an office or agency
located outside the United States except as otherwise provided in Section 1002. Such notice, which shall be irrevocable, shall specify the principal amount of such Debt Security to be repaid,
which shall be equal to the minimum authorized denomination for such Debt Security or an integral multiple thereof, and shall identify the Debt Security to be repaid and, in the case of a partial
repayment of the Debt Security, shall specify the denomination or denominations of the Debt Security or Debt Securities of the same series to be issued to the Holder for the portion of the principal
of the Debt Security surrendered which is not to be repaid. 

          If
any Bearer Security surrendered for repayment shall not be accompanied by all unmatured coupons and all matured coupons in default, such Bearer Security may be paid after
deducting from the Repayment Price an amount equal to the face amount of all such missing coupons, or the surrender of such missing coupon or coupons may be waived by the Company and the Trustee if
there be furnished to them such security or indemnity as they may require to save each of them and any Paying Agent harmless. If thereafter the Holder of such Bearer Security shall surrender to the
Trustee or any Paying Agent any such missing coupon in respect of which a deduction shall have been made from the Repayment Price, such Holder shall be entitled to receive the amount so deducted
without interest thereon; provided, however, that interest represented by coupons shall be payable only at an office or agency located outside the
United States except as otherwise provided in Section 1002. 

          The
Company shall execute and the Trustee shall authenticate and deliver without service charge to the Holder of any Registered Security so surrendered a new Registered Security or
Securities of the same series, of any authorized denomination specified in the foregoing notice, in an 

73

aggregate principal amount equal to any portion of the principal of the Registered Security so surrendered which is not to be repaid. 

          The
Company shall execute and the Trustee shall authenticate and deliver without service charge to the Holder of any Bearer Security so surrendered a new Registered Security or
Securities or new Bearer Security or Securities (and all appurtenant unmatured coupons and matured coupons in default) or any combination thereof of the same series of any authorized denomination or
denominations specified in the foregoing notice, in an aggregate principal amount equal to any portion of the principal of the Debt Security so surrendered which is not to be paid;  provided, however,
that the issuance of a Registered Security therefor shall be subject to applicable laws and regulations, including provisions of the
United States Federal income tax laws and regulations in effect at the time of the exchange; neither the Company, the Trustee nor the Security Registrar shall issue Registered Securities for Bearer
Securities if it has received an Opinion of Counsel that as a result of such issuance the Company would suffer adverse consequences under the United States Federal income tax laws then in effect and
the Company has delivered to the Trustee a Company Order directing the Trustee not to make such issuances thereafter unless and until the Trustee receives a subsequent Company Order to the contrary.
The Company shall deliver copies of such Company Order to the Security Registrar. 

          For
all purposes of this Indenture, unless the context otherwise requires, all provisions relating to the repayment of Debt Securities shall relate, in the case of any Debt Security
repaid or to be repaid only in part, to the portion of the principal of such Debt Security which has been or is to be repaid. 

          Section 1304.  Election of Repayment by Remarketing Entities.  

          The
Company may elect, with respect to Debt Securities of any series which are repayable at the option of the Holders thereof before their Stated Maturity, at any time prior to any
Repayment Date to designate one or more Remarketing Entities to purchase, at a price equal to the Repayment Price, Debt Securities of such series from the Holders thereof who give notice and surrender
their Debt Securities in accordance with Section 1303. 

          Section 1305.  Securities Payable on the Repayment Date.  

          Notice
of exercise of the option of repayment having been given and the Debt Securities so to be repaid having been surrendered as aforesaid, such Debt Securities shall, unless
purchased in accordance with Section 1304, on the Repayment Date become due and payable at the price therein specified and from and after the Repayment Date such Debt Securities shall cease to
bear interest and shall be paid on the Repayment Date, and the coupons for such interest appertaining to Bearer Securities so to be repaid, except to the extent provided above, shall be void, unless
the Company shall default in the payment of such price in which case the Company shall continue to be obligated for the principal amount of such Debt Securities and shall be obligated to pay interest
on such principal amount at the rate borne by such Debt Securities from time to time until payment in full of such principal amount. 

74

 

  ARTICLE FOURTEEN
  
  Meetings of Holders of Debt Securities         

          Section 1401.  Purposes for Which Meetings May Be Called.  

          If
Debt Securities of a series are issuable in whole or in part as Bearer Securities, a meeting of Holders of Debt Securities of such series may be called at any time and from time
to time pursuant to this Article to make, give or take any request, demand, authorization, direction, notice, consent, waiver or other Act provided by this Indenture to be made, given or taken by
Holders of Debt Securities of such series. 

          Section 1402.  Call, Notice and Place of Meetings.  

          (a)  The
Trustee may at any time call a meeting of Holders of Debt Securities of any series issuable as Bearer Securities for any purpose specified in
Section 1401, to be held at such time and at such place in the Borough of Manhattan, The City of New York, or in London as the Trustee shall determine. Notice of every meeting of Holders of
Debt Securities of any series, setting forth the time and the place of such meeting and in general terms the action proposed to be taken at such meeting, shall be given, in the manner provided in
Section 106, not less than 21 nor more than 180 days prior to the date fixed for the meeting. 

          (b)  In
case at any time the Company, pursuant to a Board Resolution, or the Holders of at least 25% in principal amount of the Outstanding Debt Securities of any
series shall have requested the Trustee to call a meeting of the Holders of Debt Securities of such series for any purpose specified in Section 1401, by written request setting forth in
reasonable detail the action proposed to be taken at the meeting, and the Trustee shall not have made the first publication of the notice of such meeting within 21 days after receipt of such
request or shall not thereafter proceed to cause the meeting to be held as provided herein, then the Company or the Holders of Debt Securities of such series in the amount
above specified, as the case may be, may determine the time and the place in the Borough of Manhattan, The City of New York, or in London for such meeting and may call such meeting for such purposes
by giving notice thereof as provided in subsection (a) of this Section. 

          Section 1403.  Persons Entitled to Vote at Meetings.  

          To
be entitled to vote at any meeting of Holders of Debt Securities of any series, a Person shall be (1) a Holder of one or more Outstanding Debt Securities of such series, or
(2) a Person appointed by an instrument in writing as proxy for a Holder or Holders of one or more Outstanding Debt Securities of such series by such Holder or Holders. The only Persons who
shall be entitled to be present or to speak at any meeting of Holders of Debt Securities of any series shall be the Persons entitled to vote at such meeting and their counsel, any representatives of
the Trustee and its counsel and any representatives of the Company and its counsel. 

75

          Section 1404.  Quorum; Action.  

          The
Persons entitled to vote a majority in principal amount of the Outstanding Debt Securities of a series shall constitute a quorum for a meeting of Holders of Debt Securities of
such series. In the absence of a quorum within 30 minutes of the time appointed for any such meeting, the meeting shall, if convened at the request of Holders of Debt Securities of such series, be
dissolved. In the absence of a quorum in any other case the meeting may be adjourned for a period of not less than 10 days as determined by the chairperson of the meeting prior to the
adjournment of such meeting. In the absence of a quorum at any such adjourned meeting, such adjourned meeting may be further adjourned for a period of not less than 10 days as determined by the
chairperson of the meeting prior to the adjournment of such adjourned meeting. Notice of this reconvening of any adjourned meeting shall be given as provided in Section 1402(a), except that
such notice need be given only once not less than five days prior to the date on which the meeting is scheduled to be reconvened. Notice of the reconvening of an adjourned meeting shall state
expressly the percentage, as provided above, of the principal amount of the Outstanding Debt Securities of such series which shall constitute a quorum. 

          Except
as limited by the proviso to Section 902, any resolution presented to a meeting or adjourned meeting duly reconvened at which a quorum is present as aforesaid may be
adopted only by the
affirmative vote of the Holders of majority in principal amount of the Outstanding Debt Securities of that series, provided, however, that, except as
limited by the proviso to Section 902, any resolution with respect to any request, demand, authorization, direction, notice, consent, waiver or other Act which this Indenture expressly provides
may be made, given or taken by the Holders of a specified percentage, which is less than a majority, in principal amount of the Outstanding Debt Securities of a series may be adopted at a meeting or
an adjourned meeting duly reconvened and at which a quorum is present as aforesaid by the affirmative vote of the Holders of such specified percentage in principal amount of the Outstanding Debt
Securities of that series. 

          Any
resolution passed or decision taken at any meeting of Holders of Debt Securities of any series duly held in accordance with this Section shall be binding on all the Holders of
Debt Securities of such series and the related coupons, whether or not present or represented at the meeting. 

          Section 1405.  Determination of Voting Rights; Conduct and Adjournment of
Meetings.  

          (a)  Notwithstanding
any other provisions of this Indenture, the Trustee may make such reasonable regulations as it may deem advisable for any meeting of Holders of
Debt Securities of such series in regard to proof of the holding of Debt Securities of such series and of the appointment of proxies and in regard to the appointment and duties of inspectors of votes,
the submission and examination of proxies, certificates and other evidence of the right to vote, and such other matters concerning the conduct of the meeting as it shall deem appropriate. Except as
otherwise permitted or required by any such regulations, the holding of Debt Securities shall be proved in the manner specified in Section 104 and the appointment of any proxy shall be proved
in the manner specified in Section 104 or, in the case of Bearer Securities, by having the signature of the person executing the proxy witnessed or guaranteed by any trust company, bank or
banker authorized by Section 104 to certify to the holding of Bearer Securities. Such regulations may provide that written instruments appointing proxies, regular 

76

on their face, may be presumed valid and genuine without the proof specified in Section 104 or other proof. 

          (b)  The
Trustee shall, by an instrument in writing, appoint a temporary chairperson of the meeting, unless the meeting shall have been called by the Company or by
Holders of Debt Securities as provided
in Section 1402(b), in which case the Company or the Holders of Debt Securities of the series calling the meeting, as the case may be, shall in like manner appoint a temporary chairperson. A
permanent chairperson and a permanent secretary of the meeting shall be elected by vote of the Persons entitled to vote a majority in principal amount of the Outstanding Debt Securities of such series
represented at the meeting. 

          (c)  At
any meeting each Holder of a Debt Security of such series or proxy shall be entitled to one vote for each $1,000 principal amount (or the equivalent in Euro,
any other composite currency or a Foreign Currency) of Debt Securities of such series held or represented by him; provided, however, that no vote shall
be cast or counted at any meeting in respect of any Debt Security challenged as not Outstanding and ruled by the chairperson of the meeting not to be Outstanding. The chairperson of the meeting shall
have no right to vote, except as a Holder of a Debt Security of such series or proxy. 

          (d)  Any
meeting of Holders of Debt Securities of any series duly called pursuant to Section 1402 at which a quorum is present may be adjourned from time to
time by Persons entitled to vote a majority in principal amount of the Outstanding Debt Securities of such series represented at the meeting; and the meeting may be held as so adjourned without
further notice. 

          Section 1406.  Counting Votes and Recording Action of Meetings.  

          The
vote upon any resolution submitted to any meeting of Holders of Debt Securities of any series shall be by written ballots on which shall be subscribed the signatures of the
Holders of Debt Securities of such series or of their representatives by proxy and the principal amounts and serial numbers of the Outstanding Debt Securities of such series held or represented by
them. The permanent chairperson of the meeting shall appoint two inspectors of votes who shall count all votes cast at the meeting for or against any resolution and who shall make and file with the
secretary of the meeting their verified written reports in triplicate of all votes cast at the meeting. A record, at least in triplicate, of the proceedings of each meeting of Holders of Debt
Securities of any series shall be prepared by the secretary of the meeting and there shall be attached to said record the original reports of the inspectors of votes on any vote by ballot taken
thereat and affidavits by one or more persons having knowledge of the facts setting forth a copy of the notice of the meeting and showing that said notice was given as provided in Section 1402
and, if applicable, Section 1401. Each copy shall be signed and verified by the affidavits of the permanent chairperson and secretary of the meeting and one such copy shall be delivered to the
Company, and another to the Trustee to be preserved by the Trustee, the latter to have attached thereto the ballots voted at the meeting. Any record so signed and verified shall be conclusive evidence
of the matters therein stated. 

77

  ARTICLE FIFTEEN
  
  Defeasance         

          Section 1501.  Termination of Company's Obligations.  

          If
this Section 1501 is specified, as contemplated by Section 301, to be applicable to any series of Debt Securities and if the Company deposits irrevocably in trust
with the Trustee money and/or Government Obligations the payments of principal and interest on which when due (and without reinvestment) will provide money in such amounts as will (together with any
money irrevocably deposited in trust with the Trustee, without investment) be sufficient to pay the principal of (and premium, if any) and any installment of principal of (and premium, if any) or
interest when due on the Debt Securities of such series and any coupons appertaining thereto on the Stated Maturity of such principal or interest or, if such series may be redeemed by the Company
prior to the Stated Maturity thereof and the Company shall have given irrevocable instructions to the Trustee to effect such redemption, at the date fixed for such redemption pursuant to Article
Eleven, and any mandatory sinking fund, repayment or analogous payments thereon on the scheduled due dates therefor, the Company's obligations under Sections 801, 803, 804, 1005, 1007, 1008, 1009 and
1010 and any other covenant determined pursuant to Section 301 to be subject to this Section shall terminate and Sections 501(4) (with respect to Sections 801, 803, 804, 1005, 1007, 1008, 1009
and 1010), 501(5), 501(6), 501(7) and 501(8) (if specified as contemplated by Section 301) shall be deemed not to be an Event of Default, in each case with respect to the Debt Securities of the
series for which such deposit was made; provided, however, that (i) no Event of Default with respect to the Debt Securities of such series under
Section 501(6) or 501(7) or event that with notice or lapse of time or both would constitute such an Event of Default shall have occurred and be continuing on the 91st day after such date,
(ii) such deposit will not result in a breach of, or constitute a default under, this Indenture or any other agreement or instrument to which the Company is a party or by which it is bound, and
(iii) such termination shall not relieve the Company of its obligations under the Debt Securities of such series and this Indenture to pay when due the principal of (and premium, if any) and
interest and additional amounts on such Debt Securities if such amounts are not paid (or payment is not provided for) when due from the money and Government Obligations (and the proceeds thereof) so
deposited. 

          It
shall be a condition to the deposit of cash and/or Government Obligations and the termination of the Company's obligations pursuant to the provisions of this Section with respect
to the Debt Securities
of any series under Sections 801, 803, 804, 1005, 1007, 1008, 1009 and 1010 and any other covenant determined pursuant to Section 301 to be subject to this Section and the inapplicability of
the Events of Default contained in Sections 501(4), 501(5), 501(6), 501(7) and 501(8) to the extent set forth above pursuant to the provisions of this Section with respect to Debt Securities of any
series that the Company deliver to the Trustee (i) an Officers' Certificate to the effect that under the laws in effect on the date such money and/or Government Obligations are deposited with
the Trustee, the amount thereof will be sufficient, after payment of all Federal, state and local taxes in respect thereof payable by the Trustee, to pay principal (and premium, if any) and interest
when due on the Debt Securities of such series; and (ii) an Officers' Certificate and an Opinion of Counsel, each stating that all conditions precedent herein provided for relating to the
defeasance contemplated in this Section have been complied with. 

78

          It shall be an additional condition to the deposit of cash and/or Government Obligations and the termination of the Company's obligations pursuant to the provisions of this Section
under Sections 801, 803, 804, 1005, 1007, 1008, 1009 and 1010 and any other covenant determined pursuant to Section 301 to be subject to this Section and the inapplicability of the Events of
Default contained in Section 501(4), 501(5), 501(6), 501(7) and 501(8) to the extent set forth above pursuant to the provisions of this Section, with respect to the Debt Securities of any
series then listed on the New York Stock Exchange, that the Company deliver an Opinion of Counsel that the Debt Securities of such series will not be delisted from the New York Stock Exchange as a
result of such deposit and termination. 

          After
a deposit as provided herein, the Trustee shall, upon Company Request, acknowledge in writing the discharge of the Company's obligations pursuant to the provisions of this
Section with respect to the Debt Securities of such series under Sections 801, 803, 804, 1005, 1007, 1008, 1009 and 1010 and any other covenant determined pursuant to Section 301 to be subject
to this Section and the inapplicability of the Events of Default contained in Sections 501(4), 501(5), 501(6), 501(7) and 501(8) to the extent set forth above. 

          Section 1502.  Repayment to Company.  

          The
Trustee and any Paying Agent shall promptly pay to the Company upon Company Request any money or Government Obligations not required for the payment of the principal of (and
premium, if any) and interest on the Debt Securities of any series for which money or Government Obligations have been deposited pursuant to Section 1501 held by them at any time. 

          The
Trustee and any Paying Agent shall promptly pay to the Company upon Company Request any money held by them for the payment of principal (and premium, if any) and interest that
remains unclaimed for two years after the Maturity of the Debt Securities for which a deposit has been made pursuant to Section 1501. After such payment to the Company, the Holders of the Debt
Securities of such series and any related coupons shall thereafter, as unsecured general creditors, look only to the Company for the payment thereof. 

          Section 1503.  Indemnity for Government Obligations.  

          The
Company shall pay and shall indemnify the Trustee against any tax, fee or other charge imposed on or assessed against the deposited Government Obligations or the principal or
interest received on such Government Obligations. 

79

          IN WITNESS WHEREOF, the parties hereto have caused this Indenture to be duly executed, and their respective corporate seals to be hereunto affixed and attested, all as of the day and
year first above written. 

	 	 	TARGET CORPORATION
	 

 	 
 	 

By	 
 	 

/s/ STEPHEN C. KOWALKE   

	 	 	 Its	 	 Vice President and Treasurer

	 

[CORPORATE SEAL]	 
 	 

 	 
 	 

 
	 

Attest:	 
 	 

 	 
 	 

 
	 

/s/ JAMES T. HALE   
 Secretary	 
 	 

 	 
 	 

 
	 

 	 
 	 

BANK ONE TRUST COMPANY, N.A.
	 

 	 
 	 

By	 
 	 

 /s/ RICHARD TARNAS   

	 	 	 Its	 	  First Vice President

	 

[CORPORATE SEAL]	 
 	 

 	 
 	 

 
	 

Attest:	 
 	 

 	 
 	 

 
	 

/s/ KEITH R. RICHARDSON   
 Trust Officer	 
 	 

 	 
 	 

 

80

	STATE OF MINNESOTA	 	)
	 	 	)SS.
	COUNTY OF HENNEPIN	 	)

          On
the 4th day of August, 2000, before me personally came Stephen C. Kowalke, to me known, who, being duly sworn, did depose and say that he resides at Shorewood, Minnesota; that he
is Vice President and Treasurer of Target Corporation, a corporation described in and which executed the above instrument; that he knows the seal of said corporation; that it was so affixed pursuant
to the authority of the Board of Directors of said corporation; and that he signed his name thereto pursuant to like authority. 

	 

 	 

/s/ DEBORAH A. PENNINGTON   
 Notary Public

81

	STATE OF 	 	)
	 	 	)SS.
	COUNTY OF 	 	)

          On
the 3rd day of August, 2000, before me personally came R. Tarnas, to me known, who, being duly sworn, did depose and say that he resides at Highland Park, Illinois; that he is
First Vice President of Bank One Trust Company, N.A., a national banking association described in and which executed the above instrument; that he knows the seal of said corporation; that it was so
affixed pursuant to the authority of the Board of Directors of said corporation; and that he signed his name thereto pursuant to like authority. 

	 

 	 

/s/ DIANE MARY WUERTZ   
 Notary Public

82

EXHIBIT A-1  

[Form of Certificate of Beneficial Ownership by a

Non-United States Person or by Certain Other Persons] 

Certificate

TARGET
CORPORATION 

[Insert
title or sufficient description of

Debt Securities to be delivered] 

          Reference
is hereby made to the Indenture dated as of August 4, 2000 (the "Indenture") between Target Corporation and Bank One Trust Company, N.A. (the "Trustee"), covering
the above-captioned Debt Securities. This is to certify that as of the date hereof,                          principal
amount of Debt Securities credited to you for our account
(i) is owned by persons that are not United States Persons, as defined below; (ii) is owned by United States Persons that are (a) foreign branches of United States financial
institutions (as defined in U.S. Treasury Regulations Section 1.165-12(c)(1)(v)) ("financial institutions") purchasing for their own account or for resale, or (b) United
States Persons who acquired the Debt Securities through foreign branches of United States financial institutions and who hold the Debt Securities through such United States financial institutions on
the date hereof (and in either case (a) or (b), each such United States financial institution encloses herewith a certificate in the form of Exhibit A-2 to the Indenture); or
(iii) is owned by United States or foreign financial institutions for purposes of resale during the restricted period (as defined in U.S. Treasury Regulations
Section 1.163-5(c)(2)(i)(D)(7)), which United States or foreign financial institutions described in clause (iii) above (whether or not also described in clause (i) or
(ii)) certify that they have not acquired the Debt Securities for purposes of resale directly or indirectly to a United States Person or to a person within the United States or its possessions. 

          [Insert
if certificate does not relate to an interest payment—We undertake to advise you by tested telex followed by written confirmation if the above
statement as to beneficial ownership is not correct on the date of delivery of the above-captioned Debt Securities in bearer form as to all of such Debt Securities with respect to such of said Debt
Securities as then appear in your books as being held for our account.] We understand that this certificate is required in connection with United States tax laws. We irrevocably authorize
you to produce this certificate or a copy hereof to any interested party in any administrative or legal proceedings with respect to the matters covered by this certificate. "United States Person"
shall mean a citizen or resident of the United States of America (including the District of Columbia), a corporation, partnership or other entity created or organized in or under the laws of
the United States or any political subdivision thereof or an estate or trust that is subject to United States Federal income taxation regardless of the source of its income. 

          [This
certificate excepts and does not relate to        principal amount of Debt Securities credited to you for our account and to
which we are not now able to make the certification set forth above. We understand that definitive Debt Securities cannot be delivered and interest cannot be paid until we are able to so certify with
respect to such principal amount of Debt Securities.]* 

Dated:
             

[To be dated on or after

             (the date

determined as provided in the

Indenture)] 

	 	 	[Name of Person Entitled to Receive Bearer Security]
	 

 	 
 	 

 (Authorized Signatory)
	 

 

 	 
 
 	 

 

Name:	 

 

	 

 

 	 
 
 	 

 

Title:	 

 

	 

 

 	 
 
 	 

 

 	 

 

 

          *Delete
if inappropriate 

2

EXHIBIT A-2  

[Form of Certificate of Status as a

Foreign Branch of a United States Financial Institution] 

Certificate

TARGET
CORPORATION 

[Insert
title or sufficient description of

Debt Securities to be delivered] 

          Reference
is hereby made to the Indenture dated as of August 4, 2000 (the "Indenture"), between Target Corporation and Bank One Trust Company, N.A., relating to the offering
of the above-captioned Debt Securities (the "Debt Securities"). Unless herein defined, terms used herein have the same meaning as given to them in the Indenture. 

          The
undersigned represents that it is a branch located outside the United States of a United States securities clearing organization, bank or other financial institution (as defined
in U.S. Treasury Regulation Section 1.165-12(c)(1)(v)) that holds customers' securities in the ordinary course of its trade or business and agrees, and authorizes you to advise the
issuer or the issuer's agent, that it will comply with the requirements of Section 165(j)(3)(A), (B) or (C) of the Internal Revenue Code of 1986 and the regulations thereunder and
is not purchasing for resale directly or indirectly to a United States Person or to a person within the United States or its possessions. We undertake to advise you by tested telex followed by written
confirmation if the statement in the immediately preceding sentence is not correct on the date of delivery of the above-captioned Debt Securities in bearer form. 

          We
understand that this certificate is required in connection with the United States tax laws. We irrevocably authorize you to produce this certificate or a copy hereof to any
interested party in any administrative or legal proceedings with respect to the matters covered by this certificate. 

Dated:
            

[To be dated on or after

             (the

date determined as provided

in the Indenture)] 

	 	 	[Name of Person Entitled to Receive Bearer Security]
	 

 	 
 	 

 (Authorized Signatory)
	 

 

 	 
 
 	 

 

Name:	 

 

	 

 

 	 
 
 	 

 

Title:	 

 

	 

 

 	 
 
 	 

 

 	 

 

 

EXHIBIT B  

[Form of Certificate to be Given by Euroclear and Clearstream Banking, S.A.

in Connection with the Exchange of All or a Portion of a

Temporary Global Security or to Obtain

Interest Prior to Exchange] 

Certificate

TARGET
CORPORATION 

[Insert
title or sufficient description of Debt Securities

to be delivered] 

          We
refer to that portion,       , of the Global Security representing the above-captioned issue [which is herewith submitted to be
exchanged for definitive Debt Securities]* [for which we are seeking to obtain payment of interest]* (the "Submitted Portion"). This is to certify, pursuant to the
Indenture dated as of August 4, 2000 (the "Indenture") between Target Corporation and Bank One Trust Company, N.A. (the "Trustee"), that we have received in writing, by tested telex or by
electronic transmission from member organizations with respect to each of the persons appearing in our records as being entitled to a beneficial interest in the Submitted Portion a Certificate of
Beneficial Ownership by a Non-United States Person or by Certain Other Persons [and, in some cases, a Certificate of Status as a Foreign Branch of a United States Financial
Institution, authorizing us to inform the issuer or the issuer's agent that it will comply with the requirements of Section 165(j)(3)(A), (B) or (C) of the Internal Revenue Code
of 1986 and the regulations thereunder]* substantially in the form of Exhibit A-1 [and A-2]* to the Indenture. 

          We
hereby request that you deliver to the office of              in             definitive Bearer Securities in
the denominations on the attached Schedule A. 

          We
further certify that as of the date hereof we have not received any notification from any of the persons giving such certificates to the effect that the statements made by them
with respect to any part of the Submitted Portion are no longer true and cannot be relied on as of the date hereof. 

Dated:
                         

	 	 	[MORGAN GUARANTY TRUST COMPANY OF

NEW YORK, BRUSSELS OFFICE, as Operator of the

Euroclear System] [Clearstream Banking, S.A.]
	 

 	 
 	 

By:	 

	 

 

 

 

 	 
 
 
 
 	 

 

 

 

 	 

 

 

 

 

          *Delete
if inappropriate. 

QuickLinks

TABLE OF CONTENTS

RECITALS OF THE COMPANY

ARTICLE ONE Definitions and Other Provisions of General Application

ARTICLE TWO Debt Security Forms

ARTICLE THREE The Debt Securities

ARTICLE FOUR Satisfaction and Discharge

ARTICLE FIVE Remedies

ARTICLE SIX The Trustee

ARTICLE SEVEN Holders' Lists and Reports By Trustee and Company

ARTICLE EIGHT Consolidation, Merger, Conveyance, Transfer or Lease

ARTICLE NINE Supplemental Indentures

ARTICLE TEN Covenants

ARTICLE ELEVEN Redemption of Debt Securities

ARTICLE TWELVE Sinking Funds

ARTICLE THIRTEEN Repayment at the Option of Holders

ARTICLE FOURTEEN Meetings of Holders of Debt Securities

ARTICLE FIFTEEN Defeasance<PAGE>

                                U.S. $100,000,000

                      DEBTOR-IN-POSSESSION CREDIT AGREEMENT

                            Dated as of May 24, 2000

                                      Among

                        LOEWEN GROUP INTERNATIONAL, INC.

                                       and

              THE SUBSIDIARIES OF LOEWEN GROUP INTERNATIONAL, INC.
                                  NAMED HEREIN,

    each as debtor and debtor-in-possession, as joint and several Borrowers,

                             THE LOEWEN GROUP INC.,

                            THE LENDERS NAMED HEREIN,

                                 as the Lenders,

                                       and

                           FIRST UNION NATIONAL BANK,

                     as L/C Issuer and Administrative Agent

<PAGE>
                                TABLE OF CONTENTS
<TABLE>
<CAPTION>
                                                                             PAGE NO.
<S>            <C>                                                           <C>
ARTICLE I      DEFINITIONS                                                      2

               1.1      Certain Defined Terms.                                  2
               1.2      Other Definitional Provisions and Rules of
                        Construction; Adjustment to Financial Covenants.        19

ARTICLE II     THE CREDITS                                                      19

               2.1      The Revolving Loans.                                    19
               2.2      Repayment of the Revolving Loans.                       19
               2.3      Ratable Revolving Loans; Types of Advances.             20
               2.4      Minimum Amount of Each Advance.                         20
               2.5      Optional Prepayments of Revolving Loans.                20
               2.6      Method of Selecting Types and Interest Periods
                        for New Advances.                                       20
               2.7      Conversion and Continuation of Outstanding Advances.    21
               2.8      Payment of Interest on Revolving Loans and Advances.    21
               2.9      Changes in Interest Rate, Etc.                          22
               2.10     Fees, Mandatory Repayments and Voluntary and
                        Reductions in Aggregate Commitment.                     22
               2.11     Rates Applicable After Default.                         23
               2.12     Method of Payment.                                      23
               2.13     Evidence of Debt; Telephonic Notices.                   24
               2.14     Notification of Advances, Interest Rates,
                        Prepayments and Commitment Reductions.                  24
               2.15     Lending Installations.                                  24
               2.16     Non-Receipt of Funds by the Agent.                      25
               2.17     Withholding Tax Exemption; Gross Up.                    25
               2.18     Termination.                                            26
               2.19     Letter of Credit Facility.                              26
               2.20     Superpriority and Secured Nature of Obligations.        31
               2.21     Joint and Several Liability; Payment
                        Indemnifications.                                       31
               2.22     Security Interest in Cash Collateral Account.           32
               2.23     No Discharge; Survival of Claims.                       32

ARTICLE III    CHANGE IN CIRCUMSTANCES                                          32

               3.1      Yield Protection.                                       32
               3.2      Changes in Capital Adequacy Regulations.                33
               3.3      Availability of Types of Advances.                      33
               3.4      Funding Indemnification.                                34
               3.5      Mitigation; Lender Statements; Survival of Indemnity.   34

ARTICLE IV     CONDITIONS PRECEDENT                                             35

               4.1      Closing Date Advances and Letters of Credit.            35
               4.2      Each Advance and Letter of Credit.                      36

ARTICLE V      [INTENTIONALLY OMITTED]                                          37
</TABLE>

                                        i
<PAGE>

<TABLE>
<CAPTION>
                                                                             PAGE NO.
<S>            <C>                                                           <C>
ARTICLE VI     REPRESENTATIONS AND WARRANTIES                                   37

               6.1      Existence and Standing.                                 37
               6.2      Authorization and Validity.                             37
               6.3      No Conflict, Government Consent.                        38
               6.4      Financial Statements.                                   38
               6.5      Material Adverse Change.                                38
               6.6      Taxes.                                                  38
               6.7      Litigation and Contingent Liabilities.                  39
               6.8      Subsidiaries; Pledge of Stock.                          39
               6.9      ERISA.                                                  39
               6.10     Accuracy of Information.                                40
               6.11     Regulation U.                                           40
               6.12     Material Agreements.                                    40
               6.13     Compliance With Laws.                                   40
               6.14     Ownership of Properties.                                40
               6.15     Investment Company Act.                                 40
               6.16     Public Utility Holding Company Act.                     41
               6.17     Post-Retirement Benefits.                               41
               6.18     Negative Pledge.                                        41
               6.19     Restrictions on Transfer.                               41
               6.20     Chapter 11 Cases and Canadian Cases.                    41
               6.21     Cash Management System.                                 41
               6.22     Articles of Incorporation, Etc.                         41

ARTICLE VII    COVENANTS                                                        42

               7.1      Reporting Requirements.                                 42
               7.2      Use of Proceeds.                                        44
               7.3      Notices of Default, Litigation, Etc.                    45
               7.4      Conduct of Business.                                    45
               7.5      Taxes.                                                  46
               7.6      Insurance.                                              46
               7.7      Compliance with Laws.                                   46
               7.8      Maintenance of Properties.                              46
               7.9      Inspection.                                             46
               7.10     Cash Management System.                                 46
               7.11     Further Assurances.                                     47
               7.12     Distributions and Payments to TLGI and
                        Canadian Subsidiaries.                                  49
               7.13     Indebtedness.                                           49
               7.14     Merger.                                                 49
               7.15     Sale of Assets.                                         49
               7.16     Prepayments.                                            50
               7.17     Affiliates.                                             50
               7.18     Investments.                                            50
               7.19     Negative Pledge.                                        52
               7.20     Liens.                                                  52
               7.21     Intentionally Omitted.                                  52
               7.22     Interest Coverage Ratio.                                52
               7.23     Minimum Funeral Home Gross Margin.                      53
               7.24     Ownership of Company.                                   53
               7.25     Acquisitions.                                           53
               7.26     Subsidiaries.                                           53
               7.27     Synthetic Leases.                                       53
               7.28     Deliveries Regarding Additional Borrowers.              53
               7.29     Intentionally Omitted.                                  54
               7.30     Chapter 11 Claims.                                      54
               7.31     Limitation on Repayments.                               54
               7.32     Protocol.                                               54
               7.33     Agreements.                                             54
               7.34     Post Closing Deliveries.                                54

ARTICLE VIII   DEFAULTS                                                         55

ARTICLE IX     ACCELERATION, WAIVERS, AMENDMENTS AND REMEDIES                   58

               9.1      Acceleration.                                           58
               9.2      Amendments.                                             59
               9.3      Preservation of Rights.                                 60
</TABLE>

                                      ii
<PAGE>

<TABLE>
<CAPTION>
                                                                             PAGE NO.
<S>            <C>                                                           <C>
ARTICLE X      GENERAL PROVISIONS                                               60

               10.1     Survival of Representations.                            60
               10.2     Governmental Regulation.                                60
               10.3     Stamp Duties.                                           60
               10.4     Headings.                                               60
               10.5     Entire Agreement, Independence of Covenants.            61
               10.6     Several Obligations; Benefits of this Agreement.        61
               10.7     Expenses, Indemnification.                              61
               10.8     Numbers of Documents.                                   63
               10.9     Accounting; Currency Conversions.                       63
               10.10    Severability of Provisions.                             64
               10.11    Nonliability of Lenders.                                64
               10.12    Choice of Law.                                          64
               10.13    Consent to Jurisdiction.                                64
               10.14    Waiver of Jury Trial.                                   65
               10.15    Confidentiality.                                        65
               10.16    Judgment Currency.                                      65
               10.17    Canadian Interest Antidotes.                            65
               10.18    Parties Including Trustees; U.S. Court Proceedings.     66
               10.19    Counterparts; Effectiveness.                            66

ARTICLE XI     THE AGENT                                                        66

               11.1     Appointment.                                            66
               11.2     Powers.                                                 66
               11.3     General Immunity.                                       66
               11.4     No Responsibility for Revolving Loans, Recitals, Etc.   67
               11.5     Action on Instructions of Lenders.                      67
               11.6     Employment of Agents and Counsel.                       67
               11.7     Reliance on Documents; Counsel.                         67
               11.8     Agent's Reimbursement and Indemnification.              67
               11.9     Rights as a Lender.                                     68
               11.10    Lenders' Credit Decisions.                              68
               11.11    Successor Agent.                                        68
               11.12    Agent's Fee.                                            69

ARTICLE XII    SETOFF; RATABLE PAYMENTS                                         69

               12.1     Setoff.                                                 69
               12.2     Ratable Payments.                                       69

ARTICLE XIII   BENEFIT OF AGREEMENT; ASSIGNMENTS; PARTICIPATIONS                69

               13.1     Successors and Assigns.                                 69
               13.2     Participations.                                         70
               13.3     Assignments.                                            71
               13.4     Dissemination of Information.                           72
               13.5     Tax Treatment.                                          72

ARTICLE XIV    NOTICES 91

               14.1     Giving Notice.                                          72
               14.2     Change of Address.                                      72
</TABLE>

SCHEDULE A             -        Parties to Credit Agreement
SCHEDULE 1.1(a)        -        Insurance Companies
SCHEDULE 2.1           -        Lenders' Commitments
SCHEDULE 2.19.8        -        Existing Letters of Credit
SCHEDULE 6.7           -        Litigation
SCHEDULE 6.8           -        Subsidiaries
SCHEDULE 6.14          -        Real Property Assets
SCHEDULE 6.19          -        Terms of Transfer Restrictions
SCHEDULE 6.21          -        Cash Management Arrangements
SCHEDULE 7.28          -        Post-Closing Borrower Subsidiaries

EXHIBIT A              -        Form of Revolving Note
EXHIBIT B              -        Required Opinions
EXHIBIT C              -        Form of Compliance Certificate
EXHIBIT D              -        Form of Assignment Agreement
EXHIBIT E              -        Form of Notice of Assignment
EXHIBIT F              -        Form of Revolving Loan Borrowing Notice
EXHIBIT G              -        Form of Prepayment Notice
EXHIBIT H              -        Form of Joinder Agreement
EXHIBIT I              -        Form of Conversion/Continuation Notice
EXHIBIT J              -        Form of Borrowing Order
EXHIBIT K              -        Form of Approved Sale Certificate
EXHIBIT L              -        Form of Security Agreement
EXHIBIT M              -        Form of Mortgage

                                       iii
<PAGE>

                      DEBTOR-IN-POSSESSION CREDIT AGREEMENT

     THIS DEBTOR-IN-POSSESSION CREDIT AGREEMENT, dated as of May 24, 2000 is
entered into by and among LOEWEN GROUP INTERNATIONAL, INC., a Delaware
corporation, as debtor and debtor-in-possession ("COMPANY"), EACH OF THE
COMPANY'S SUBSIDIARIES LISTED ON SCHEDULE A HERETO, each as debtor and
debtor-in-possession (the Company and each such Subsidiary are each individually
referred to herein as a "BORROWER" and, collectively, on a joint and several
basis, as the "BORROWERS"), THE LOEWEN GROUP INC., a corporation organized under
the laws of the province of British Columbia, Canada, THE LENDERS NAMED HEREIN,
as the initial Lenders, and FIRST UNION NATIONAL BANK, as the L/C Issuer and as
the Administrative Agent for the Lenders.

                              W I T N E S S E T H:

     WHEREAS, on June 1, 1999 (the "PETITION DATE"), each Borrower filed a
voluntary petition for relief under the Bankruptcy Code (such term and other
capitalized terms used in these Recitals without definition have the meanings
set forth in SECTION 1.1 of this Agreement) with the United States Bankruptcy
Court for the District of Delaware (together with any other court having
jurisdiction over the Chapter 11 Cases from time to time, the "U.S. COURT")
(such proceedings being jointly administered under Case No. 99-1244 (PJW), but
excluding any Chapter 11 cases filed in error and subsequently dismissed, are
hereinafter referred to as the "CHAPTER 11 CASES");

     WHEREAS each Borrower continues to operate its businesses and manage its
properties as a debtor-in-possession pursuant to Sections 1107 and 1108 of the
Bankruptcy Code;

     WHEREAS, on the Petition Date the Initial CCAA Order was made by the
Superior Court of Justice (Ontario) (together with any other court having
jurisdiction over the Canadian Cases from time to time, the "CANADIAN COURT") in
respect of TLGI and the Canadian Subsidiaries under the CCAA (such proceedings
under Court File No. 99-CL-3384 being hereinafter referred to as the "CANADIAN
CASES");

     WHEREAS, a certain Debtor-in Possession Credit Agreement, dated as of June
1, 1999 (as amended, modified or supplemented from time to time, the "EXISTING
DIP CREDIT AGREEMENT") was entered into by and among the Borrowers, The Loewen
Group Inc., the lenders party thereto (the "EXISTING LENDERS") and First Union
National Bank, as letter of credit issuer and as the administrative agent for
the Existing Lenders party thereto (in such capacity, the "EXISTING AGENT"),
pursuant to which the Existing Lenders provided a revolving credit facility in
the maximum amount of $200,000,000 on a post-petition basis on the terms and
conditions set forth therein;

     WHEREAS, the Borrowers have requested that the Lenders provide a revolving
credit facility in the maximum amount of $100,000,000 on a post-petition basis
on the terms and conditions set forth herein; and

     WHEREAS, Lenders are willing to provide such post-petition financing only
if all of the Obligations hereunder and under the other Loan Documents (a)
constitute allowed superpriority administrative expense claims in the Chapter 11
Cases as set forth herein, and (b) are secured by a first priority Lien on all
of the Borrowers' unencumbered real, personal and mixed property, and a junior
Lien on all of Borrowers' property which is subject to valid, perfected and
nonvoidable liens on the Petition Date.

     NOW, THEREFORE, in consideration of the foregoing and the mutual covenants
and agreements hereinafter set forth, the parties hereto hereby agree as
follows:

                                       1
<PAGE>

                                    ARTICLE I
                                   DEFINITIONS

     1.1       CERTAIN DEFINED TERMS. As used in this Agreement the following
terms shall have the following meanings, such meanings being equally applicable
to both the singular and plural forms of the terms defined:

               "ADVANCE" means a borrowing consisting of simultaneous Revolving
Loans of the same Type made to the Borrowers by each of the Lenders pursuant to
SECTION 2.1 for, in the case of Eurodollar Advances, the same Interest Period.

               "AFFILIATE" of any Person means any other Person directly or
indirectly controlling, controlled by or under common control with such Person.
A Person shall be deemed to control another Person if the controlling Person
owns 10% or more of any class of voting securities (or other ownership
interests) of the controlled Person or possesses, directly or indirectly, the
power to direct or cause the direction of the management or policies of the
controlled Person, whether through ownership of stock, by contract or otherwise.

               "AGENT" means First Union in its capacity as Administrative Agent
for the Lenders pursuant to ARTICLE XI of this Agreement, and not in its
capacity as the L/C Issuer or a Lender, and any successor Agent appointed
pursuant to ARTICLE XI of this Agreement.

               "AGGREGATE COMMITMENT" means the aggregate of the Commitments of
all the Lenders, as reduced from time to time pursuant to the terms hereof.

               "AGREEMENT" means this Debtor-In-Possession Credit Agreement, as
it from time to time may be amended, restated, supplemented or otherwise
modified in accordance with the terms hereof.

               "AGREEMENT ACCOUNTING PRINCIPLES" means GAAP as in effect from
time to time, applied in a manner consistent with that used in preparing the
financial statements referred to in SECTION 6.4.

               "ALTERNATE BASE RATE" means, for any day, a floating rate of
interest per annum equal to the higher of (a) the Base Rate for such day and (b)
the sum of the Federal Funds Effective Rate for such day plus 0.50% per annum.
Changes in the rate of interest on that portion of any Revolving Loans
maintained as Floating Rate Advances (and in the rate of interest on any other
Obligations from time to time bearing interest at a rate determined by reference
to the Alternate Base Rate) will take effect simultaneously with each change in
the Alternate Base Rate.

               "APPLICABLE LAW" means all applicable provisions of
constitutions, statutes, laws, rules, treaties, regulations and orders of all
Governmental Authorities and all applicable orders, rules and decrees of courts
and arbitrators.

               "APPROVED SALE" means any sale of Property pledged to the Agent
under the terms of the Collateral Documents (i) which is expressly permitted by
the terms of SECTION 7.15 and with respect to which the Borrowers shall have
delivered to the Agent prior to consummation of such sale a certificate from an
Authorized Officer in the form of EXHIBIT K hereto certifying that both
immediately before and after giving effect to such sale, no Default or Unmatured
Default shall have occurred and be continuing, or (ii) which is otherwise
approved by the Required Lenders.

               "ARTICLE" means a numbered article of this Agreement, unless
another document is specifically referenced.

               "ASSET SALE" means the sale by any Borrower or any of such
Borrower's Subsidiaries to any Person other than any of the Borrowers or any of
their Wholly-Owned Subsidiaries of (i) any of the stock of any Subsidiary of
such Borrower, (ii) substantially all of the assets of any division or line of
business of such Borrower or any of its Subsidiaries, or (iii) any other assets
(whether tangible or intangible) of such Borrower or any of its Subsidiaries
outside of the ordinary course of business.

               "AUTHORIZED OFFICER" means (a) with respect to TLGI, any of the
President,

                                       2
<PAGE>

Executive Vice President, Senior Vice President and CFO or Vice President and
Treasurer of TLGI, or any Person designated by any two of the foregoing, acting
singly and (b) with respect to the Borrowers, any of the President, Executive
Vice President, Senior Vice President and CFO or Vice President, Finance of the
Company, or any Person designated by any two of the foregoing, acting singly.

               "BCCA PLAN" means any plan or plans of arrangement or
reorganization of TLGI under the Companies Act (British Columbia).

               "BANKRUPTCY CODE" means Title 11 of the United States Code
entitled "Bankruptcy", as now and hereafter in effect, or any successor statute.

               "BASE RATE" means, at any time, the floating rate per annum then
most recently announced by First Union in Charlotte, North Carolina as the
reference rate of interest it will use to determine rates of interest for loans
in Dollars in the United States and referred to by it as its "prime lending
rate". The Base Rate is not necessarily intended to be the lowest rate of
interest determined by First Union in connection with extensions of credit.

               "BORROWER CONCENTRATION ACCOUNT" has the meaning assigned to that
term in SECTION 7.10(a).

               "BORROWERS" has the meaning assigned to that term in the
introduction to this Agreement; PROVIDED, that Borrowers shall also mean and
include any Subsidiary of the Company that shall from time to time become party
hereto as a borrower by executing instruments reasonably satisfactory to the
Agent assuming the obligations of a Borrower under this Agreement in accordance
with SECTION 7.28. Notwithstanding any provision to the contrary herein, the
Borrowers shall not include any Insurance Company.

               "BORROWING ORDER" means an order of the U.S. Court entered in
the Chapter 11 Cases after a final hearing under Bankruptcy Rule 4001(c)(2)
substantially in the form attached hereto as EXHIBIT J, with any
modifications thereto and approved by the Agent in its sole discretion, as
the same may be amended, supplemented or otherwise modified from time to time
with the express written consent or joinder of Required Lenders, and such
order is in full force and effect and has not been reversed, stayed, modified
or amended and as to which (i) any right to appeal or seek certiorari, review
or rehearing has been waived or (ii) the time to appeal or seek certiorari,
review or rehearing has expired and as to which no appeal or petition for
certiorari, review or rehearing is pending.

               "BUSINESS DAY" means (a) with respect to any borrowing, payment
or rate selection of Eurodollar Advances, a day (other than a Saturday or Sunday
or other day on which banks are authorized or required to be closed) on which
banks generally are open in Charlotte, New York and London for the conduct of
substantially all of their commercial lending activities and (b) for all other
purposes, a day (other than a Saturday or Sunday or other day on which banks are
authorized or required to be closed) on which banks generally are open in
Charlotte and New York for the conduct of substantially all of their commercial
lending activities.

               "CANADIAN COURT" has the meaning set forth in the recitals to
this Agreement.

               "CANADIAN GAAP" means, at any time, generally accepted accounting
principles in Canada at such time.

               "CANADIAN PLAN" means a pension plan provided by TLGI or any
Canadian Subsidiary.

               "CANADIAN SUBSIDIARIES" means any or all of the Subsidiaries of
TLGI incorporated or otherwise organized under the laws of Canada or any
province of Canada.

               "CAPITALIZED LEASE" of a Person means any lease of Property by
such Person as lessee which would be capitalized on a balance sheet of such
Person prepared in

                                       3
<PAGE>

accordance with Agreement Accounting Principles.

               "CAPITALIZED LEASE OBLIGATIONS" of a Person means the amount of
the obligations of such Person under Capitalized Leases which would be shown as
a liability on a balance sheet of such Person prepared in accordance with
Agreement Accounting Principles.

               "CASH BALANCES" means, as at any time of determination with
respect to a Person, the sum of the Dollar amount of all money, currency and
credit balances carried in Deposit Accounts of such Person PLUS the Dollar value
of all Investments of the type described in SECTIONS 7.18(d) through 7.18(i)
which would be carried as assets on the balance sheet of such Person and its
Subsidiaries.

               "CCAA" means the Companies' Creditors Arrangement Act (Canada),
as now and hereafter in effect, or any successor statute or statutes.

               "CCAA ORDERS" means the Initial CCAA Order and any other orders
made by the Canadian Court in the Canadian Cases.

               "CCAA PLAN" means a plan of compromise or arrangement, as from
time to time amended and or supplemented, filed by TLGI and the Canadian
Subsidiaries under the CCAA.

               "CDN$" means the lawful money of Canada.

               "CEMETERY GROSS MARGIN" means, for any period, an amount equal to
(i) Cemetery Revenue for such period MINUS (ii) the amount indicated on the
consolidated income statement of TLGI and its Subsidiaries for such period as
cemetery costs and expenses PLUS (iii) the sum of the amounts for such period of
(a) any amount included in clause (ii) of this definition that is classified in
the consolidated statement of cash flows of TLGI and its Subsidiaries for such
period as depreciation or amortization in accordance with GAAP, including, for
greater certainty, amounts classified as amortization that result from sales of
individual cemetery plots by TLGI and its Subsidiaries in the course of their
normal business operations, and (b) any other non-cash charges of TLGI and its
Subsidiaries for such period that are included in clause (ii) of this
definition.

               "CEMETERY OPERATING CASH FLOW" means, for any period, an amount
equal to (i) the sum of the amounts for such period of (a) Cemetery Gross Margin
PLUS (b) the Cemetery Working Capital Adjustment, MINUS (ii) Consolidated
Capital Expenditures in respect of cemetery operations (net of any proceeds of
any related financings with respect to such expenditures) for such period.

               "CEMETERY PROPERTIES" means all Property used or intended for use
in connection with the business of TLGI or any of its Subsidiaries as being an
owner or provider of cemeteries and cemetery services, and shall include,
without limitation, those Facilities owned by any of the Borrowers.

               "CEMETERY REVENUE" means, for any period, the consolidated gross
revenues of TLGI and its Subsidiaries for such period to the extent attributable
to the operations of Cemetery Properties, determined on a consolidated basis in
accordance with GAAP.

               "CEMETERY WORKING CAPITAL ADJUSTMENT" means, for any period, an
amount equal to (i) the sum of the amounts for such period of (a) the decrease
in the consolidated short-term and long-term installment contract accounts
receivable (net of the related cancellation and unearned interest reserves) of
TLGI and its Subsidiaries during such period PLUS (b) the decrease in the
consolidated accounts receivable from cemetery merchandise trusts of TLGI and
its Subsidiaries during the period, MINUS (ii) the decrease in the consolidated
cemetery long-term liabilities of TLGI and its Subsidiaries during such period.
For greater certainty, (x) the balance sheet items described in clauses (i)(a),
(i)(b)

                                       4
<PAGE>

and (ii) shall be calculated in accordance with GAAP and on a basis consistent
with the notes to the annual consolidated financial statements of TLGI and its
Subsidiaries in prior periods, and (y) if any of the balance sheet items
described in clause (i)(a), (i)(b) or (ii) increased during such period, the
"decrease" in such item as described in the applicable clause shall be a
negative number.

               "CHANGE OF CONTROL" means an event which shall be deemed to have
occurred if (a) the Company shall at any time cease to be a Wholly-Owned
Subsidiary of TLGI, or (b) any Person or "group" (within the meaning of Section
13(d) or 14(d) of the Securities Exchange Act of 1934, as amended) shall either
(x) acquire beneficial ownership of more than 50% of any outstanding class of
common stock of TLGI having ordinary voting power in the election of directors
of TLGI or (y) obtain the power (whether or not exercised) to elect a majority
of TLGI's directors, or (c) during any period of 12 consecutive calendar months,
individuals (i) who were directors of TLGI on the first day of such period, or
(ii) whose election or nomination for election to the board of directors of TLGI
was recommended or approved by at least a majority of the directors then still
in office who were directors of TLGI on the first day of such period, or whose
election or nomination for election was so approved, shall cease to constitute a
majority of the board of directors of TLGI.

               "CHAPTER 11 CASES" means the Chapter 11 Cases as defined in the
recital clauses of this Agreement.

               "CHIEF FINANCIAL OFFICER" means, at any time, the Person who
reports to the board of directors of TLGI on the financial affairs of TLGI and
its Subsidiaries.

               "CLOSING DATE" means the date on which the conditions set forth
in SECTION 4.1 are satisfied or waived in accordance with the terms of this
Agreement.

               "CODE" means the Internal Revenue Code of 1986, as amended,
reformed or otherwise modified from time to time.

               "COLLATERAL" means, collectively, all property of the estate of
each Borrower under Section 541(a) of the Bankruptcy Code, including all of the
real, personal and mixed property (including capital stock) in which Liens are
purported to be granted pursuant to the Collateral Documents as security for the
Obligations.

               "COLLATERAL DOCUMENTS" means the Security Agreement, the
Mortgages and any other security agreements, pledge agreements, assignments,
financing statements or other agreements, documents, instruments or certificates
delivered by any Credit Party pursuant to this Agreement, any other Loan
Document or an applicable order of the U.S. Court or the Canadian Court in order
to grant to the Agent, on behalf of Lenders, a Lien on any real, personal or
mixed property of such Credit Party as security for the Obligations.

               "COLLATERAL TRUST AGREEMENT" means that certain Collateral Trust
Agreement, dated as of May 15, 1996 and executed by TLGI, the Company and its
Subsidiaries named therein, and Bankers Trust Company, as collateral agent, as
such Collateral Trust Agreement may be amended or modified and as in effect from
time to time.

               "COMMERCIAL LETTER OF CREDIT" means any letter of credit or
similar instrument issued for the purpose of providing the primary payment
mechanism in connection with the purchase of any materials, goods or services by
TLGI, any Borrower or any Subsidiary in the ordinary course of business of TLGI,
such Borrower or such Subsidiary.

               "COMMITMENT" means, relative to any Lender, the obligation of
such Lender to make Revolving Loans and to purchase participations in Letters of
Credit not

                                       5
<PAGE>

exceeding the amount set forth opposite such Lender's name on SCHEDULE 2.1
hereto or as set forth in any Notice of Assignment relating to any assignment
that has become effective pursuant to SECTION 13.3.2, as such amount may be
modified from time to time pursuant to the terms hereof.

               "COMMITMENT TERMINATION DATE" means the earliest of (i) the
Stated Maturity Date, and (ii) the first effective date of any plan of
reorganization in the Chapter 11 Cases or the implementation of a CCAA Plan in
the Canadian Cases, as specified in such plan or plans, (iii) the date of
termination in whole of the Commitments pursuant to SECTION 9.1, and (iv) the
date of any sale, transfer or other disposition of all or substantially all of
the assets or stock of the Borrowers and their Subsidiaries, taken as a whole.

               "COMPANY" has the meaning assigned to that term in the
introduction to this Agreement.

               "COMPLIANCE CERTIFICATE" means a certificate executed by the
Chief Financial Officer in the form of EXHIBIT C annexed hereto.

               "CONSOLIDATED CAPITAL EXPENDITURES" means, for any period, the
sum of (i) the aggregate of all expenditures (whether paid in cash or other
consideration or accrued as a liability and including that portion of
Capitalized Lease Obligations which is capitalized on the consolidated balance
sheet of TLGI and its Subsidiaries) of TLGI and its Subsidiaries during that
period that, in conformity with GAAP, are included in "construction of new
facilities" or "purchase of property and equipment" or comparable items
reflected in the consolidated statement of cash flows of TLGI and its
Subsidiaries PLUS (ii) to the extent not covered by clause (i) of this
definition, the aggregate of all expenditures by TLGI and its Subsidiaries
during that period (a) to purchase or develop computer software or systems (but
only to the extent such expenditures are capitalized on the consolidated balance
sheet of TLGI and its Subsidiaries in conformity with GAAP), (b) to acquire (by
purchase or otherwise) the business, property or fixed assets of any Person, or
the stock or other evidence of beneficial ownership of any Person that, as a
result of such acquisition, becomes a Subsidiary of TLGI or any of its
Subsidiaries, or (c) to purchase, develop or construct land or other real
property or improvements for use in connection with the cemetery operations of
TLGI and its Subsidiaries.

               "CONSOLIDATED OPERATING CASH FLOW" means, for any period, the sum
of (a) Cemetery Operating Cash Flow for such period PLUS (b) Non-Cemetery
Operating Cash Flow for such period.

               "CONSOLIDATED INTEREST CHARGES" means, for any period, on a
consolidated basis, all interest (including the interest component of
Capitalized Lease Obligations and Synthetic Lease Obligations), and all
amortization of debt discount and expense on all Indebtedness of TLGI and its
Subsidiaries for such period.

               "CONTINGENT OBLIGATION" of a Person means any agreement,
undertaking or arrangement by which such Person assumes, guarantees, endorses,
contingently agrees to purchase or provide funds for the payment of, or
otherwise becomes or is contingently liable upon, the obligation or liability of
any other Person, or agrees to maintain the net worth or working capital or
other financial condition of any other Person, or otherwise assures any creditor
of such other Person against loss, including, without limitation, any comfort
letter, operating agreement, take-or-pay contract or reimbursement obligation
arising pursuant to a letter of credit (including any Letter of Credit).

               "CONTROLLED GROUP" means all members of a controlled group of
corporations and all trades or businesses (whether or not incorporated) under
common control which, together with the Borrowers or any of their Subsidiaries,
are treated as a

                                       6
<PAGE>

single employer under Section 414 of the Code.

               "CONVERSION/CONTINUATION NOTICE" has the meaning specified in
SECTION 2.7.

               "CREDIT PARTY" means each of TLGI and the Borrowers and any other
Person (other than the Agent or any Lender) from time to time executing a Loan
Document, and "CREDIT PARTIES" means all such Persons, collectively.

               "DEFAULT" means an event described in ARTICLE VIII.

               "DEPOSIT ACCOUNT" means a demand, time, savings, passbook or like
account with a bank, savings and loan association, credit union or like
organization, other than an account evidenced by a negotiable certificate of
deposit.

               "DISTRIBUTION" in respect of any corporation shall mean (a)
dividends or other distributions on capital stock of the corporation (except
dividends or other distributions payable solely in shares of capital stock), and
(b) the redemption, retirement or acquisition of such stock or of warrants,
rights or other options to purchase such stock (except when solely in exchange
for such stock).

               "DOLLARS" and "$" mean the lawful money of the United States.

               "ENVIRONMENTAL CLAIM" means any investigation or any written
notice, notice of violation, claim, action, suit, proceeding, demand, abatement
order or other order or directive (conditional or otherwise), by any
Governmental Authority or any other Person, arising (i) pursuant to or in
connection with any actual or alleged violation of any Environmental Law, (ii)
in connection with any Hazardous Materials or any actual or alleged Hazardous
Materials Activity, or (iii) in connection with any actual or alleged damage,
injury, threat or harm to health, safety, natural resources or the environment.

               "ENVIRONMENTAL LAWS" means any and all current or future
statutes, ordinances, orders, rules, regulations, guidance documents,
guidelines, judgments, Governmental Authorizations, or any other requirements of
governmental authorities relating to (i) environmental matters, including those
relating to any Hazardous Materials Activity, (ii) the generation, use, storage,
transportation or disposal of Hazardous Materials, or (iii) occupational safety
and health, industrial hygiene, land use or the protection of human, plant or
animal health or welfare, in any manner applicable to the business of TLGI or
any of its Subsidiaries or any Facility in a particular state, province or
territory, including the Comprehensive Environmental Response, Compensation, and
Liability Act (42 U.S.C. Section 9601 ET SEQ.), the Hazardous Materials
Transportation Act (49 U.S.C. Section 1801 ET SEQ.), the Resource Conservation
and Recovery Act (42 U.S.C. Section 6901 ET SEQ.), the Federal Water Pollution
Control Act (33 U.S.C. Section 1251 ET SEQ.), the Clean Air Act (42 U.S.C.
Section 7401 ET SEQ.), the Toxic Substances Control Act (15 U.S.C. Section 2601
ET SEQ.), the Federal Insecticide, Fungicide and Rodenticide Act (7 U.S.C.
Section 136 ET SEQ.), the Occupational Safety and Health Act (29 U.S.C. Section
651 ET SEQ.), the Oil Pollution Act (33 U.S.C. Section 2701 ET SEQ.), the
Emergency Planning and Community Right-to-Know Act (42 U.S.C. Section 11001 ET
SEQ.), and the Canadian Environmental Protection Act, the Environmental
Protection Act (Ontario), the Ontario Water Resources Act (Ontario), the
Occupational Health and Safety Act (Ontario) and comparable federal and
provincial legislation in Canada, Ontario and other provinces and territories of
Canada, each as amended or supplemented, any analogous present or future U.S. or
Canadian federal, provincial, state or local statutes or laws, and any
regulations promulgated pursuant to any of the foregoing.

               "ERISA" means the Employee Retirement Income Security Act of
1974, as amended from time to time, and any rule or regulation issued
thereunder.

               "EURODOLLAR ADVANCE" means an Advance that bears interest at a
Eurodollar Rate.

                                       7
<PAGE>

               "EURODOLLAR BASE RATE" means, with respect to a Eurodollar
Advance for the relevant Interest Period, (a) the per annum rate for deposits in
Dollars for a period corresponding to the duration of the relevant Interest
Period, which appears on Dow Jones Page 3750 at approximately 11:00 a.m. (London
time) two Business Days prior to the first day of such Interest Period and (b)
if such rate does not appear on Dow Jones Page 3750 on such day, the per annum
rate at which deposits in Dollars are offered by First Union to first-class
banks in the London interbank market at approximately 11:00 a.m. (London time)
two Business Days prior to the first day of such Interest Period, in the
approximate amount of First Union's relevant Eurodollar Loan and having a
maturity approximately equal to such Interest Period. The reference to Dow Jones
Page 3750 in this definition shall be construed to be a reference to the
relevant page or any other page that may replace such page on the Dow Jones
service or any other service that may be nominated by the British Bankers'
Association as the information vendor for the purpose of displaying British
Bankers' Association Interest Settlement Rates for deposits in Dollars.

               "EURODOLLAR LOAN" means a Revolving Loan which bears interest at
a Eurodollar Rate.

               "EURODOLLAR RATE" means, with respect to a Eurodollar Advance for
the relevant Interest Period, the sum of (a) the quotient of (i) the Eurodollar
Base Rate applicable to such Interest Period, divided by (ii) one minus the
Reserve Requirement (expressed as a decimal) applicable to such Interest Period,
plus (b) 2.75% per annum. The Eurodollar Rate shall be rounded to the next
higher multiple of 1/16 of 1% if the rate is not such a multiple.

               "EXCHANGE RATE" means, on any date when an amount expressed in a
currency other than Dollars is to be determined with respect to any Letter of
Credit, the nominal rate of exchange of the applicable L/C Issuer in the New
York foreign exchange market for the purchase by such L/C Issuer (by cable
transfer) of such currency in exchange for Dollars at 12:00 noon (New York time)
one Business Day prior to such date, expressed as a number of units of such
currency per one Dollar.

               "EXISTING CREDIT AGREEMENTS" means, collectively, (i) the Second
Amended and Restated Credit Agreement dated as of March 27, 1998 among Company,
TLGI, the lenders party thereto, Bank of Montreal, as administrative agent and
syndication agent, (ii) the $121,300,000 1994 MEIP Credit Agreement, dated as of
June 14, 1994 among TLGI, the Company, LMIC, as agent for TLGI and the Company,
the lenders party thereto, and Wachovia Bank of Georgia, N.A., as agent for the
lenders, (iii) the Note Agreement dated for reference September 1, 1993 among
Company, TLGI and the noteholders party thereto relating to the $60,000,000
9.62% Senior Guaranteed Notes, Series D due September 11, 2003, and such notes,
(iv) the Note Agreement dated for reference February 1, 1994 among Company, TLGI
and the noteholders party thereto relating to the $50,000,000 6.49% Senior
Guaranteed Notes, Series E due February 25, 2004, and such notes, (v) the
Indenture dated as of September 30, 1997 among Company, TLGI and State Street
Bank and Trust Company relating to $300,000,000 of Senior Guaranteed Notes, and
such notes, (vi) the Indenture dated as of March 20, 1996 among Company, TLGI
and Fleet National Bank of Connecticut relating to the $350,000,000 Senior
Guaranteed Notes, Series 1 and Series 2, and such notes, (vii) the Indenture
dated as of October 1, 1996 among Company, TLGI and Fleet National Bank relating
to the $350,000,000 Senior Guaranteed Notes, Series 3 and Series 4, and such
notes, (viii) the Indenture dated as of September 26, 1997 among TLGI, the
Company and The Trust Company of Bank of Montreal, as trustee, relating to the
CDN$200,000,000 Senior

                                       8
<PAGE>

Guaranteed Notes, Series 5, and such notes, (ix) the Indenture dated as of May
28, 1998 among Company, TLGI and State Street Bank and Trust Company relating to
the $400,000,000 Senior Guaranteed Notes, Series 6 and Series 7, and such notes,
(x) INTENTIONALLY OMITTED, (xi) INTENTIONALLY OMITTED, (xii) all agreements,
documents and instruments pursuant to which any interest in collateral is
granted or purported to be granted, created, evidenced or perfected pursuant to
any of the foregoing, including without limitation, all deeds of trust,
mortgages, security agreements, pledge agreements, assignments, licenses,
landlord consents and releases, financing statements, fixture filings,
registrations or similar documents and (xiii) all ancillary agreements as to
which any holder of any of the obligations evidenced by any of the foregoing is
a party or a beneficiary and all other agreements, instruments, documents and
certificates including promissory notes, consents, assignments, contracts, and
notices delivered in connection with any of the foregoing or the transactions
contemplated thereby, in each case as any of the foregoing may be in effect as
of the Closing Date and as the same may be amended, supplemented or otherwise
modified from time to time to the extent permitted hereunder.

               "EXISTING DIP CREDIT AGREEMENT" means the Existing DIP Credit
Agreement as defined in the recitals to this Agreement.

               "EXISTING REVOLVER AGREEMENT" means the Existing Credit Agreement
described in clause (i) of the definition thereof.

               "FACILITIES" means any and all real property (including all
buildings, fixtures or other improvements located thereon) now, hereafter or
heretofore owned, leased, operated or used by TLGI or any of its Subsidiaries or
any of their respective predecessors.

               "FAIR VALUE" means the value of the relevant asset determined in
an arm's-length transaction conducted in good faith between an informed and
willing buyer, under no compulsion to buy, and an informed and willing seller,
under no compulsion to sell.

               "FEDERAL FUNDS EFFECTIVE RATE" means, for any day, an interest
rate per annum equal to the weighted average of the rates on overnight Federal
funds transactions with members of the Federal Reserve System arranged by
Federal funds brokers on such day, as published for such day (or, if such day is
not a Business Day, for the immediately preceding Business Day) by the Federal
Reserve Bank of New York, or, if such rate is not so published for any day which
is a Business Day, the average of the quotations at approximately 10:00 a.m.
(New York City time) on such day on such transactions received by the Agent from
three Federal funds brokers of recognized standing selected by the Agent in its
sole discretion.

               "FEE LETTER" has the meaning assigned to that term in SECTION
2.10(a).

               "FINAL ORDER" means an order, judgment or other decree of the
U.S. Court or any other court or judicial body with proper jurisdiction, as the
case may be, which is in full force and effect and which has not been reversed,
stayed, modified or amended and as to which (i) any right to appeal or seek
certiorari, review or rehearing has been waived or (ii) the time to appeal or
seek certiorari, review or rehearing has expired and as to which no appeal or
petition for certiorari, review or rehearing is pending.

               "FINANCIAL UNDERTAKING" of a Person means (a) any repurchase
obligation or liability of such Person or any of its Subsidiaries with respect
to accounts or notes receivable sold by such Person or any of its Subsidiaries,
(b) any liability under any sale and leaseback transactions which do not create
a liability on the consolidated balance sheet of such Person and its
Subsidiaries, (c) obligations arising with respect to any other transaction
which is the functional equivalent of or takes the place of borrowing but which
does not constitute a liability on the consolidated balance sheet of such Person
and its

                                       9
<PAGE>

Subsidiaries, or (d) net liabilities under any agreements, devices or
arrangements designed to protect at least one of the parties thereto from the
fluctuations of interest rates, exchange rates or forward rates applicable to
such party's assets, liabilities or exchange transactions, including, but not
limited to, interest rate exchange agreements, forward currency exchange
agreements, interest rate cap or collar protection agreements, forward rate
currency or interest rate options.

               "FIRST UNION" means First Union National Bank in its individual
capacity, and its successors.

               "FLOATING RATE" means, for any day, a rate per annum equal to the
sum of (a) the Alternate Base Rate for such day, changing when and as the
Alternate Base Rate changes, PLUS (b) 1.25%.

               "FLOATING RATE ADVANCE" means an Advance which bears interest at
the Floating Rate.

               "FLOATING RATE LOAN" means a Revolving Loan which bears interest
at the Floating Rate.

               "FUNERAL HOME GROSS MARGIN" means, for any period, an amount
equal to (i) Funeral Home Revenue for such period MINUS (ii) the amount
indicated on the consolidated income statement of TLGI and its Subsidiaries for
such period as funeral home costs and expenses PLUS (iii) any amount included in
clause (ii) of this definition that constitutes Synthetic Lease Rentals during
such period attributable to assets utilized in the funeral home operations of
TLGI and its Subsidiaries.

               "FUNERAL HOME PROPERTIES" means all Property used or intended for
use in connection with the business of TLGI or any of its Subsidiaries of being
a provider of (i) funeral home services or (ii) combined funeral home and
cemetery services, and shall include, without limitation, those Facilities owned
by any of the Borrowers.

               "FUNERAL HOME REVENUE" means, for any period, the consolidated
gross revenues of TLGI and its Subsidiaries for such period to the extent
attributable to the operations of Funeral Home Properties, determined on a
consolidated basis in accordance with GAAP. Notwithstanding anything to the
contrary contained herein, no amounts included in Cemetery Revenue shall be
included in the calculation of Funeral Home Revenue.

               "GAAP" means Canadian GAAP until such time as TLGI and its
Subsidiaries shall prepare their books of record and account in accordance with
U.S. GAAP, at which time and at all times thereafter, "GAAP" shall mean U.S.
GAAP.

               "GOVERNMENTAL ACTS" has the meaning specified in SECTION
2.19.6(a).

               "GOVERNMENTAL AUTHORITY" means any country or nation, any
political subdivision of such country or nation, and any entity exercising
executive, legislative, judicial, regulatory or administrative functions of or
pertaining to government of any country or nation or political subdivision
thereof.

               "HAZARDOUS MATERIALS" means (i) any chemical, material or
substance at any time defined as or included in the definition of "hazardous
substances", "hazardous wastes", "hazardous materials", "extremely hazardous
waste", "acutely hazardous waste", "radioactive waste", "biohazardous waste",
"pollutant", "toxic pollutant", "contaminant", "restricted hazardous waste",
"infectious waste", "toxic substances", or any other term or expression intended
to define, list or classify substances by reason of properties harmful to
health, safety or the indoor or outdoor environment (including harmful
properties such as ignitability, corrosivity, reactivity, carcinogenicity,
toxicity, reproductive toxicity, "TCLP toxicity" or "EP toxicity" or words of
similar import under any applicable Environmental Laws) or otherwise regulated
under Environmental Laws;

                                       10
<PAGE>

(ii) any oil, petroleum, petroleum fraction or petroleum derived substance;
(iii) any drilling fluids, produced waters and other wastes associated with the
exploration, development or production of crude oil, natural gas or geothermal
resources; (iv) any flammable substances or explosives; (v) any radioactive
materials; (vi) any asbestos-containing materials; (vii) urea formaldehyde foam
insulation; (viii) electrical equipment which contains any oil or dielectric
fluid containing polychlorinated biphenyls; (ix) pesticides; and (x) any other
chemical, material or substance, exposure to which is prohibited, limited or
regulated by any governmental authority or which may or could pose a hazard to
the health and safety of the owners, occupants or any Persons in the vicinity of
any Facility or to the indoor or outdoor environment.

               "HAZARDOUS MATERIALS ACTIVITY" means any past, current, proposed
or threatened activity, event or occurrence involving any Hazardous Materials,
including the use, manufacture, possession, storage, holding, presence,
existence, location, Release, threatened Release, discharge, placement,
generation, transportation, processing, construction, treatment, abatement,
removal, remediation, disposal, disposition or handling of any Hazardous
Materials, and any corrective action or response action with respect to any of
the foregoing.

               "INDEBTEDNESS" of a Person means, without duplication, such
Person's (a) obligations for borrowed money, (b) obligations representing the
deferred purchase price of Property or services (other than accounts payable
arising in the ordinary course of such Person's business payable on terms
customary in the trade), including amounts payable by such Person in respect of
covenants not to compete, but only to the extent required by GAAP to be
reflected on the balance sheet of TLGI as liabilities, (c) obligations, whether
or not assumed, secured by Liens on or payable out of the proceeds or production
from Property now or hereafter owned or acquired by such Person, (d) obligations
which are evidenced by notes, acceptances, or other instruments (but exclusive
of notes, bills and checks presented in the ordinary course of business by such
Person to banks for collection or deposit), (e) Capitalized Lease Obligations,
(f) Synthetic Lease Obligations, (g) Securitization Obligations (but only to the
extent of the maximum recourse liability of such Person (or one or more of its
Affiliates) under the documentation for the related securitization transaction
giving rise to such Securitization Obligations for losses or defaults which are
attributable to the obligors of the receivables included in such securitization
transaction), (h) Financial Undertakings, (i) Contingent Obligations and (j)
obligations under or in connection with letters of credit (including, with
respect to TLGI or the Borrowers, any Letter of Credit); but excluding, in any
event, with reference to TLGI, the Borrowers and the other Subsidiaries, all
obligations of TLGI, the Borrowers and the other Subsidiaries of the character
referred to in this definition to the extent owing to TLGI, the Borrowers or any
other Subsidiary.

               "INITIAL CCAA ORDER" means the order made by the Canadian Court
under the CCAA in the Canadian Cases declaring that TLGI and the Canadian
Subsidiaries are companies to which the CCAA applies, authorizing TLGI and the
Canadian Subsidiaries to file a plan or plans of compromise or arrangement under
the CCAA, staying all proceedings taken or that might be taken in respect of
TLGI and the Canadian Subsidiaries except as expressly provided therein, and
granting certain other ancillary relief.

               "INSURANCE COMPANY" means any Subsidiary of Loewen Life Insurance
Group, Inc. which is primarily engaged in the business of providing insurance
and related products, which Insurance Companies as of the date hereof consist of
those Subsidiaries set forth on SCHEDULE 1.1(a) hereto.

               "INTEREST PERIOD" means, with respect to a Eurodollar Advance, a
period of

                                       11
<PAGE>

one, two or three months commencing on a Business Day selected by the Borrowers
pursuant to this Agreement. Such Interest Period shall end on (but exclude) the
day which corresponds numerically to such date one, two or three months
thereafter, unless there is no such numerically corresponding day in such next,
second or third succeeding month, in which case such Interest Period shall end
on the last Business Day of such next, second or third succeeding month. If a
Interest Period would otherwise end on a day which is not a Business Day, such
Interest Period shall end on the next succeeding Business Day, unless said next
succeeding Business Day falls in a new calendar month, in which case such
Interest Period shall end on the immediately preceding Business Day.

               "INVESTMENT" of a Person means any loan, advance (other than
commission, travel and similar advances to officers and employees made in the
ordinary course of business), extension of credit (other than accounts
receivable arising in the ordinary course of business on terms customary in the
trade), deposit account or contribution of capital by such Person to any other
Person or any investment in, or purchase or other acquisition of, the stock,
partnership interests, notes, debentures or other securities of any other Person
made by such Person.

               "INVESTMENT MANAGER CHANGE GAIN/LOSS" means any non-cash gain or
loss arising directly from the replacement of any investment manager or trustee
as approved by the Investment Committee of the Company's Board of Directors.

               "L/C COMMITMENT AMOUNT" means $50,000,000.

               "L/C DRAFT" means a draft drawn on the L/C Issuer pursuant to any
of the Letters of Credit.

               "L/C INTEREST" has the meaning specified in SECTION 2.19.2.

               "L/C ISSUER" means First Union; PROVIDED, HOWEVER, that the
Borrowers and First Union may mutually agree with another Lender that with
respect to a particular Letter of Credit, such other Lender shall issue such
Letter of Credit, and in such event such Lender shall be the L/C Issuer
hereunder with respect to such Letter of Credit, and First Union shall be the
L/C Issuer with respect to all Letters of Credit other than Letters of Credit
issued by another Lender pursuant to this proviso.

               "L/C OBLIGATIONS" means an amount equal to the sum (without
duplication) of (i) the aggregate of the amount then available for drawing under
each of the Letters of Credit, (ii) the face amounts of all outstanding L/C
Drafts corresponding to the Letters of Credit, which L/C Drafts have been
accepted by the L/C Issuer but not yet paid, (iii) the aggregate outstanding
amount of Reimbursement Obligations at such time and (iv) the aggregate face
amount of all Letters of Credit requested by the Borrowers but not yet issued
(unless such request has been denied).

               "LENDERS" means the lending institutions listed on the signature
pages of this Agreement and any other lending institutions which may become
party hereto pursuant to the terms hereof, and their respective successors and
assigns permitted in accordance with the terms hereof.

               "LENDING INSTALLATION" means, with respect to a Lender, any
office, branch, subsidiary or affiliate of such Lender.

               "LETTER OF CREDIT" means any Standby Letter of Credit or
Commercial Letter of Credit issued pursuant to SECTION 2.19 hereof.

               "LIEN" means any lien (statutory or other), mortgage, pledge,
hypothecation, security interest, charge, assignment, deposit arrangement,
encumbrance or other security agreement or arrangement of any kind or nature
whatsoever (including, without limitation, the interest of a vendor or lessor
under any conditional sale, Capitalized Lease or other title retention
agreement).

                                       12
<PAGE>

               "LMIC" means Loewen Management Investment Corporation, a Delaware
corporation and a Wholly-Owned Subsidiary of Company.

               "LOAN DOCUMENTS" means this Agreement, the Letters of Credit, the
Collateral Documents, and the promissory notes (if any) issued pursuant to
SECTION 13.1.

               "MATERIAL ADVERSE EFFECT" means a material adverse effect on (a)
the business, Property, financial condition, results of operations, or prospects
of TLGI, the Borrowers and the other Subsidiaries taken as a whole, (b) the
ability of the Credit Parties, taken as a whole, to perform their obligations
under the Loan Documents, or (c) the validity or enforceability of any of the
Loan Documents or the rights or remedies of the Agent, the L/C Issuer or the
Lenders thereunder.

               "MATERIAL CONTRACT" means any contract or arrangement to which
TLGI or any Borrower or any Subsidiary is a party (other than the Loan
Documents) for which breach, nonperformance, cancellation or failure to renew
could reasonably be expected to have a Material Adverse Effect.

               "MATERIAL JUDGMENT EVENT" means the entry of a judgment, award or
other order as to post-Petition Date liability or debt (whether or not such
judgment, award or other order is bonded, stayed, contested or appealable)
against any of TLGI, any Borrower or any of their respective Subsidiaries at any
time when the amount of such judgment, award or order, when added to the
aggregate amount of all other judgments, awards and orders as to post-Petition
Date liabilities or debts which at such time shall have been entered against any
of TLGI, any Borrower or any of their respective Subsidiaries without having
been finally satisfied in full or vacated, is in excess of $5,000,000.

               "MINORITY INTERESTS" means any shares of stock of any class of a
Subsidiary (other than directors' qualifying shares as required by law or shares
of stock having no right to vote or receive dividends) that are not owned by
TLGI and/or one or more of its Subsidiaries. Minority Interests shall be valued
by valuing Minority Interests constituting preferred stock at the voluntary or
involuntary liquidating value of such preferred stock, whichever is greater, and
by valuing Minority Interests constituting common stock at the book value of
capital and surplus applicable thereto adjusted, if necessary, to reflect any
changes from the book value of such common stock required by the foregoing
method of valuing Minority Interests in preferred stock.

               "MIPS" means the 9.45% Cumulative Monthly Income Preferred
Securities, Series A, issued by Loewen Group Capital, L.P., and the related
Series A Junior Subordinated Debentures issued by the Company and purchased by
Loewen Group Capital, L.P. with the proceeds of the sale of the 9.45% Cumulative
Monthly Income Preferred Securities, Series A.

               "MONITOR" means the monitor appointed under the Initial CCAA
Order.

               "MOODY'S" means Moody's Investors Service, Inc.

               "MORTGAGE" means a security instrument (whether designated as a
deed of trust or a mortgage or by any similar title) executed and delivered by
any Credit Party in substantially the form of EXHIBIT M annexed hereto such form
as may be approved by the Agent in its sole discretion, in each case with such
changes thereto to conform with local laws or customary local practices,
including without limitation such changes to convert EXHIBIT M into a deed of
trust or a deed to secure debt as may be required by local law or local
customary practice, as such security instrument or amendment may be amended,
supplemented or otherwise modified from time to time, and "MORTGAGES" means all
such instruments, collectively.

               "MULTIEMPLOYER PLAN" means a Plan maintained pursuant to a
collective bargaining agreement or any other arrangement to which any Borrower
or any member of

                                       13
<PAGE>

the Controlled Group is a party to which more than one employer is obligated to
make contributions.

               "NET ASSET SALE PROCEEDS" means, with respect to any Asset Sale,
cash payments (including any cash received by way of deferred payment pursuant
to, or by monetization of, a note receivable or otherwise, but only as and when
so received) received from such Asset Sale net of any bona fide direct costs
incurred in connection with such Asset Sale including (i) income taxes
reasonably estimated to be actually payable within two years of the date of such
Asset Sale as a result of any gain recognized in connection with such Asset Sale
(ii) payment of the outstanding principal amount of, premium or penalty, if any,
and interest on any Indebtedness (other than the Loans) that is secured by a
Lien on the stock or assets in question and that is required to be repaid under
the terms thereof as a result of such Asset Sale and (iii) any bona fide,
reasonable fees payable to the Debtors' financial advisors with respect to such
Asset Sale.

               "NET INSURANCE/CONDEMNATION PROCEEDS"' means any cash payments or
proceeds received by any Borrower or any of its Subsidiaries (i) under any
business interruption or casualty insurance policy in respect of a covered loss
thereunder or (ii) as a result of the taking of any assets of any Borrower or
any of its Subsidiaries by any Person pursuant to the power of eminent domain,
condemnation or otherwise, or pursuant to a sale of any such assets to a
purchaser with such power under threat of such a taking, in each case net of any
actual and reasonable documented costs incurred by any Borrower or any of its
Subsidiaries in connection with the adjustment or settlement of any claims of
any Borrower or such Subsidiary in respect thereof.

               "NON-CEMETERY OPERATING CASH FLOW" means, for any period, an
amount equal to (i) the sum of (a) the Funeral Home Gross Margin for such
period, PLUS (b) the sum of (ii) all cash dividends received during such period
from Insurance Companies, (iii) any amount included in clause (ii) of the
definition of Funeral Home Gross Margin that is classified in the consolidated
statement of cash flows of TLGI and its Subsidiaries for such period as
depreciation or amortization in accordance with GAAP, and (iv) any other
non-cash charges of TLGI and its Subsidiaries for such period that are included
in clause (ii) or the definition of Funeral Home Gross Margin, MINUS (v) the
sum, without duplication, of the amounts for such period of (a) the amount
separately classified in the consolidated income statement of TLGI and its
Subsidiaries for such period as "general and administrative" expenses (excluding
therefrom restructuring costs associated with the Chapter 11 Cases and the
Canadian Cases) on a basis consistent with prior periods and in accordance with
GAAP, (b) Consolidated Capital Expenditures (net of any proceeds of any related
financings with respect to such expenditures) of TLGI and its Subsidiaries,
excluding Consolidated Capital Expenditures in respect of cemetery operations
(net of any proceeds of any related financings with respect to such
expenditures), and (c) any amount (other than Consolidated Capital Expenditures)
attributable to the operation of Funeral Home Properties that is capitalized on
the consolidated balance sheet of TLGI and its Subsidiaries in conformity with
GAAP during such period. Notwithstanding anything to the contrary contained
herein, no amounts included in Cemetery Operating Cash Flow shall be included
in the calculation of Non-Cemetery Operating Cash Flow.

               "NOTICE OF ASSIGNMENT" has the meaning specified in SECTION
13.3.2.

               "OBLIGATIONS" means all obligations of every nature of the
Borrowers arising or existing under the Loan Documents, including, without
limitation, the L/C Obligations and any liability of the Borrowers on any claim,
whether or not the right to payment in respect of such claim is reduced to
judgment, liquidated, unliquidated, fixed or contingent, matured, disputed,
undisputed, legal, equitable, secured or unsecured, and whether or not such
claim is discharged, stayed or otherwise affected by any bankruptcy,

                                       14
<PAGE>

insolvency, reorganization or other similar proceeding. Without limiting the
generality of the foregoing, the Obligations of the Borrowers under the Loan
Documents include (a) the obligation to pay principal, interest, charges,
expenses, fees, attorneys' fees and disbursements, indemnities and other amounts
payable by the Borrowers under any Loan Document and (b) the obligation to
reimburse any amount in respect of any of the foregoing that the Agent or any
Lender, in its sole discretion, may elect to pay or advance on behalf of the
Borrowers.

               "OVERHEAD ALLOCATION AGREEMENT" means the Management Services
Agreement dated May 31, 1999 setting forth the methodology for allocating
general and administrative expenses and restructuring costs associated with the
Chapter 11 Cases and the Canadian Cases between the Borrowers and their
Subsidiaries, on one hand, and TLGI and the Canadian Subsidiaries, on the other
hand, as approved by the Canadian Court, as such agreement may be amended,
supplemented or otherwise modified from time to time with the consent of the
Agent.

               "PARTICIPANT" has the meaning specified in SECTION 13.2.1.

               "PAYMENT OFFICE" means the principal office of the Agent in
Charlotte, North Carolina, located on the date hereof at 301 South College
Street, Charlotte, North Carolina 28288, or such other office of the Agent as
the Agent may from time to time designate by written notice to the Borrowers and
the Lenders. All payments to be made to the Agent at the Payment Office shall be
made by wire transfer to First Union National Bank, ABA # 053-000-219 for credit
to Account No.2070482789126, Attention: Thomas M. Cambern, in the name of First
Union, with references to Special Situations/The Loewen Group, Inc. and the type
of payment being made, or to such other account as the Agent may from time to
time designate by written notice to the Borrowers and the Lenders.

               "PBGC" means the Pension Benefit Guaranty Corporation, or any
successor thereto.

               "PERMITTED CANADIAN CCAA LIEN" means a Lien on all of TLGI's
and/or any Canadian Subsidiary's property to secure reimbursement claims in
respect of any statutory liabilities which may be imposed on any director or
officer of any one of TLGI or any Canadian Subsidiary by reason of TLGI's or
such Canadian Subsidiary's failure to pay (i) any statutory deemed trust
amounts in favor of the Crown in right of Canada or of any province thereof
which are required to be deducted from employees' wages, including, without
limitation, amounts in respect of employment insurance, Canada Pension Plan,
Quebec Pension Plan and income taxes, (ii) amounts accruing and payable by TLGI
and the Canadian Subsidiaries in respect of employment insurance, Canada Pension
Plan, Quebec Pension Plan, workers compensation, employer health taxes and
similar obligations of any jurisdiction with respect to employees, (iii) all
goods and services or other applicable sales taxes payable by TLGI and the
Canadian Subsidiaries or their customers in connection with the sale of goods
and services by TLGI and the Canadian Subsidiaries to such customers, (iv) any
amount payable to the Crown in right of Canada or of any province thereof or any
political subdivision thereof or any other taxation authority in respect of
municipal realty, municipal business or other taxes, assessments or levies of
any nature or kind which are entitled at law to be paid in priority to claims of
secured creditors and which are attributable to or in respect of the carrying on
of the business by TLGI and the Canadian Subsidiaries, and (v) any payment
required to be deposited into, or otherwise held in, trust pursuant to
applicable laws, rules or regulations or pursuant to established policies of
TLGI and the Canadian Subsidiaries in connection with or resulting from the sale
by TLGI and the Canadian Subsidiaries of cemetery or funeral services; provided
that such Lien shall secure an amount no greater than

                                       15
<PAGE>

$10,000,000.

               "PERSON" means any natural person, corporation, limited liability
company, firm, joint venture, partnership, association, enterprise, trust or
other entity or organization, or any government or political subdivision or any
agency, department or instrumentality thereof.

               "PETITION DATE" means the Petition Date as defined in the
recitals to this Agreement.

               "PLAN" means an employee pension benefit plan which is covered
by Title IV of ERISA or subject to the minimum funding standards under
Section 4412 of the Code as to which the Borrower or any member of the
Controlled Group may have any liability.

               "PREPAYMENT NOTICE" has the meaning specified in SECTION 2.5.

               "PREPETITION INDEBTEDNESS" means Indebtedness of any Borrower
outstanding on the Petition Date, including Indebtedness under the Existing
Credit Agreements.

               "PROPERTY" of a Person means any and all property, whether real,
personal, tangible, intangible, or mixed, of such Person, or other assets owned,
leased or operated by such Person.

               "PURCHASERS" has the meaning specified in SECTION 13.3.1.

               "REGISTER" has the meaning specified in SECTION 13.3.2.

               "REGULATION D" means Regulation D of the Board of Governors of
the Federal Reserve System as from time to time in effect and any successor
thereto or other regulation or official interpretation of said Board of
Governors relating to reserve requirements applicable to member banks of the
Federal Reserve System.

               "REGULATION T", "REGULATION U" and "REGULATION X" mean,
respectively, Regulations T, U and X of the Board of Governors of the Federal
Reserve System as from time to time in effect and any successor thereto or other
regulation or official interpretation of said Board of Governors relating to the
subject matter thereof.

               "REIMBURSEMENT OBLIGATION" has the meaning specified in SECTION
2.19.3.

               "RELEASE" means any release, spill, emission, leaking, pumping,
pouring, injection, escaping, deposit, disposal, discharge, dispersal, dumping,
leaching or migration of Hazardous Materials into the indoor or outdoor
environment (including the abandonment or disposal of any barrels, containers or
other closed receptacles containing any Hazardous Materials), including the
movement of any Hazardous Materials through the air, soil, surface water or
groundwater.

               "RELEVANT TAX" has the meaning specified in SECTION 2.17(b).

               "RENTAL" of a Person means the aggregate fixed amounts payable by
such Person under any lease of Property having an original term (including any
required renewals or any renewals at the option of the lessor or lessee) of one
year or more, regardless of whether such lease is characterized as an operating
lease or a Synthetic Lease.

               "REPORTABLE EVENT" means a reportable event as defined in
Section 4043 of ERISA and the regulations issued under such section, with
respect to a Plan, excluding, however, such events as to which the PBGC by
regulation waived the requirement of Section 4043(a) of ERISA that it be
notified within 30 days of the occurrence of such event; PROVIDED, HOWEVER, that
a failure to meet the minimum funding standard of Section 412 of the Code and of
Section 302 of ERISA shall be a Reportable Event regardless of the issuance of
any such waiver of the notice requirement in accordance with either Section
4043(a) of ERISA or Section 412(d) of the Code.

               "REQUIRED LENDERS" means the greater of (x) Lenders in the
aggregate

                                       16
<PAGE>

having at least 51% of the Aggregate Commitment or, if the Aggregate Commitment
has been terminated, Lenders in the aggregate holding at least 51% of the
aggregate unpaid principal amount of the outstanding Advances and the L/C
Obligations, and (y) more than one-half in number of the Lenders.

               "RESERVE REQUIREMENT" means, with respect to a Interest Period,
the maximum aggregate reserve requirement (including all basic, supplemental,
marginal and other reserves) which is imposed under Regulation D on Eurodollar
liabilities.

               "REVOLVING LOAN" means a loan by a Lender to the Borrowers as
part of an Advance.

               "REVOLVING LOAN BORROWING DATE" means a date on which an Advance
is made hereunder.

               "REVOLVING LOAN BORROWING NOTICE" has the meaning specified in
SECTION 2.6.

               "SECTION" means a numbered section of this Agreement, unless
another document is specifically referenced.

               "SECURITIZATION OBLIGATIONS" of a Person means the outstanding
purchaser's investment or outstanding capital or other principal equivalent that
purchasers or other investors are entitled to receive in respect of any
securitization or other sale or asset-backed financing of receivables of such
Person or its Affiliates effected by such Person.

               "SECURITY AGREEMENT" means the Security Agreement executed and
delivered by the Borrowers and the Agent on the Closing Date and executed and
delivered by any additional Borrower from time to time thereafter in accordance
with SECTION 7.28, substantially in the form of EXHIBIT L annexed hereto, as
such Security Agreement may be amended, supplemented or otherwise modified from
time to time.

               "SECURITY INDUSTRIAL" means Security Industrial Insurance
Company, a Subsidiary of Loewen Life Insurance Group, Inc.

               "SINGLE EMPLOYER PLAN" means a Plan maintained by any Borrower or
any member of the Controlled Group for employees of any Borrower or any member
of the Controlled Group.

               "SPECIFIED REMITTANCE TIME" means (a) if the relevant Payment
Office is located in Charlotte, 1:00 p.m. (Charlotte time) and (b) if the
relevant Payment Office is located elsewhere, such time as the Agent shall
specify after consultation with the Borrowers and the Lenders.

               "STANDARD & POOR'S" means Standard & Poor's Ratings Services, a
division of The McGraw-Hill Companies, Inc.

               "STANDBY LETTER OF CREDIT" means any standby letter of credit or
similar instrument issued for the purpose of supporting (i) workers'
compensation liabilities of TLGI, the Borrowers or any of their Subsidiaries,
(ii) the obligations of third party insurers of TLGI, the Borrowers or any of
their Subsidiaries arising by virtue of the laws of any jurisdiction requiring
third party insurers, (iii) obligations to cash management service providers,
(iv) performance, payment, deposit or surety obligations of TLGI, the Borrowers
or any of their Subsidiaries, in any case if required by law or governmental
rule or regulation or in accordance with custom and practice in the industry, or
(v) any other obligations of TLGI, the Borrowers or any of their Subsidiaries
ordinarily or customarily supported by standby letters of credit; PROVIDED that
Standby Letters of Credit may not be issued for the purpose of supporting (a)
trade payables or (b) any Indebtedness constituting "antecedent debt" (as that
term is used in Section 547 of the Bankruptcy Code) or (c) any Indebtedness
(whether of principal, interest or otherwise) on account of amounts owing by
TLGI or any of its Subsidiaries to any of their creditors as of the

                                       17
<PAGE>

Petition Date.

               "STATED AMOUNT" means, when used with reference to a Letter of
Credit, (x) at the time of issuance, the face amount thereof, and (y) at any
time thereafter, the aggregate amount available to be drawn under such Letter of
Credit at such time.

               "STATED MATURITY DATE" means June 30, 2001.

               "SUBSIDIARY" of a Person means (a) any corporation more than 50%
of the outstanding securities having ordinary voting power of which, or more
than 50% of the economic benefits associated with all outstanding securities of
which, shall at the time be owned or controlled, directly or indirectly, by such
Person or by one or more of its Subsidiaries or by such Person and one or more
of its Subsidiaries, or (b) any partnership, association, limited liability
company, joint venture or similar business organization more than 50% of the
ownership interests having ordinary voting power of which, or more than 50% of
the economic benefits associated with all outstanding ownership interests of
which, shall at the time be so owned or controlled. Unless otherwise expressly
provided, all references herein to a "Subsidiary" shall mean a Subsidiary of
TLGI.

               "SYNTHETIC LEASE" of a Person means any lease of Property by such
Person as lessee which under GAAP would or may be treated as a true operating
lease but which under tax law or commercial law is treated as secured
Indebtedness of such Person and not as a true lease.

               "SYNTHETIC LEASE OBLIGATIONS" of a Person means the aggregate
funded amount under all Synthetic Leases to which such Person is party as
lessee.

               "SYNTHETIC LEASE RENTALS" of a Person means the aggregate fixed
amounts payable by such Person under a Synthetic Lease of Property having an
original term (including any required renewals or any renewals at the option of
the lessor or lessee) of one year or more.

               "TAXING JURISDICTION" has the meaning specified in SECTION
2.17(b).

               "TLGI" means The Loewen Group Inc., a corporation incorporated
under the laws of the province of British Columbia, Canada.

               "TOTAL UTILIZATION OF COMMITMENTS" means, as at any date of
determination, the sum of (i) the aggregate principal amount of all outstanding
Revolving Loans (other than Revolving Loans made for the purpose of reimbursing
the L/C Issuer for any amount drawn under any Letter of Credit but not yet so
applied) PLUS (ii) the aggregate amount of all issued and outstanding Letters of
Credit.

               "TRANSFEREE" has the meaning specified in SECTION 13.4.

               "TYPE" means, (a) with respect to any Revolving Loan, its nature
as a Floating Rate Loan or Eurodollar Loan, and (b) with respect to any Advance,
its nature as a Floating Rate Advance or Eurodollar Advance.

               "UNFUNDED LIABILITIES" means the amount (if any) by which the
present value of all vested nonforfeitable benefits under all Single Employer
Plans exceeds the Fair Value of all Plan assets allocable to such benefits, all
determined as of the then most recent valuation date for such Plans.

               "UNITED STATES" and "U.S." mean the United States of America.

               "UNMATURED DEFAULT" means an event which but for the lapse of
time or the giving of notice, or both, would constitute a Default.

               "U.S. COURT" has the meaning set forth in the recitals to this
Agreement.

               "U.S. GAAP" means, at any time, generally accepted accounting
principles in the United States at such time.

               "WHOLLY-OWNED SUBSIDIARY" of a Person means (a) any Subsidiary
all of the outstanding voting securities of which shall at the time be owned or
controlled, directly or

                                       18
<PAGE>

indirectly, by such Person or one or more Wholly-Owned Subsidiaries of such
Person, or by such Person and one or more Wholly-Owned Subsidiaries of such
Person, or (b) any partnership, association, joint venture or similar business
organization 100% of the ownership interests having ordinary voting power of
which shall at the time be so owned or controlled.

     1.2       OTHER DEFINITIONAL PROVISIONS AND RULES OF CONSTRUCTION;
ADJUSTMENT TO FINANCIAL COVENANTS.

     (a)       Any of the terms defined herein may, unless the context otherwise
requires, be used in the singular or the plural, depending on the reference.

     (b)       The use herein of the word "include" or "including", when
following any general statement, term or matter, shall not be construed to limit
such statement, term or matter to the specific items or matters set forth
immediately following such word or to similar items or matters, whether or not
nonlimiting language (such as "without limitation" or "but not limited to" or
words of similar import) is used with reference thereto, but rather shall be
deemed to refer to all other items or matters that fall within the broadest
possible scope of such general statement, term or matter.

                                   ARTICLE II
                                   THE CREDITS

     2.1       THE REVOLVING LOANS. From and including the Closing Date and
prior to the Commitment Termination Date, each Lender severally agrees, on the
terms and conditions set forth in this Agreement (including, without limitation,
the terms and conditions of SECTION 2.10 and SECTION 9.1 relating to the
reduction, suspension or termination of the Aggregate Commitment), to make
Revolving Loans in Dollars to the Borrowers (who shall borrow on a joint and
several basis) from time to time in an aggregate amount, together with such
Lender's L/C Interest, not to exceed at any one time outstanding the amount of
such Lender's Commitment; PROVIDED, HOWEVER, that the Aggregate Commitment shall
be deemed used for purposes of determining the availability of Revolving Loans
(but not for purposes of determining each Lender's commitment fee pursuant to
SECTION 2.10, which commitment fee shall be determined for each Lender as
described in SECTION 2.10) from time to time to the extent of the aggregate L/C
Obligations then outstanding, and such deemed use of the Aggregate Commitment
shall be applied to the Lenders ratably according to their respective
Commitments. Subject to the terms of this Agreement (including, without
limitation, the terms and conditions of SECTION 2.10 and SECTION 9.1 relating to
the reduction, suspension or termination of the Aggregate Commitment), the
Borrowers may borrow, repay and reborrow Revolving Loans at any time prior to
the Commitment Termination Date. Unless earlier terminated in accordance with
the terms and conditions of this Agreement, the Commitments of the Lenders to
lend hereunder shall expire on the Commitment Termination Date. Anything
contained in this Agreement to the contrary notwithstanding, the aggregate
principal amount of Revolving Loans outstanding on any date of determination
shall not exceed by more than $20,000,000 the highest aggregate principal amount
of Revolving Loans outstanding as of any date after the Closing Date which is
less than 30 days prior to such date of determination. The Borrowers agree,
jointly and severally, to immediately prepay the Loans in the amounts and at the
times as may be necessary to comply with the immediately preceding sentence.

     2.2       REPAYMENT OF THE REVOLVING LOANS. Any outstanding Revolving
Loans shall be paid in full by the Borrowers on the Commitment Termination Date;
PROVIDED, HOWEVER, that nothing in this SECTION 2.2 shall be construed as
limiting or modifying the joint and several obligations of the Borrowers to
repay any or all of the

                                       19
<PAGE>

outstanding Revolving Loans at any earlier time in accordance with the terms of
this Agreement.

     2.3       RATABLE REVOLVING LOANS; TYPES OF ADVANCES. Each Advance
hereunder shall consist of Revolving Loans made from the several Lenders ratably
in proportion to the ratio that their respective Commitments bear to the
Aggregate Commitment. Any Advance may be a Floating Rate Advance or a Eurodollar
Advance, as the Borrowers shall select in accordance with SECTIONS 2.6 and 2.7.

     2.4       MINIMUM AMOUNT OF EACH ADVANCE. Each Advance shall be in an
amount not less than $2,000,000 or an integral multiple of $1,000,000 in excess
thereof PROVIDED, HOWEVER, that any Advance may be in the amount of the unused
Aggregate Commitment.

     2.5       OPTIONAL PREPAYMENTS OF REVOLVING LOANS. Subject to SECTION 3.4
and the requirements of SECTION 2.4, the Borrowers may (following notice given
to the Agent by the Borrowers, in the form attached hereto as EXHIBIT G (a
"PREPAYMENT NOTICE") by not later than 11:00 a.m. (Charlotte time) on the date
of the proposed prepayment), such notice specifying the aggregate principal
amount of and the proposed date of the prepayment and if such notice is given
the Borrowers shall, prepay the outstanding principal amounts of the Floating
Rate Loans comprising part of the same Advance in whole or ratably in part,
together with accrued interest to but excluding the date of such prepayment on
the principal amount prepaid and if the Advance to be prepaid is a Eurodollar
Advance and following a Prepayment Notice given to the Agent by the Borrowers by
not later than 11:00 a.m. (Charlotte time), on the third Business Day preceding
the date of the proposed prepayment, such notice specifying the Advance to be
prepaid and the proposed date of the prepayment, and if such notice is given,
the Borrowers shall prepay the outstanding principal amounts of the Eurodollar
Loans comprising a Eurodollar Advance in whole (and not in part), together with
accrued interest to but excluding the date of such prepayment on the principal
amount prepaid; PROVIDED, HOWEVER, that a Eurodollar Advance may only be prepaid
on the expiration of the Interest Period applicable thereto. In the case of a
Floating Rate Advance, each partial prepayment shall be in an aggregate
principal amount not less than $5,000,000.

     2.6       METHOD OF SELECTING TYPES AND INTEREST PERIODS FOR NEW ADVANCES.
The Borrowers shall select the Type of each Advance and, in the case of a
Eurodollar Advance, the Interest Period applicable to such Advance from time to
time. The Borrowers shall give the Agent irrevocable notice, in the form
attached hereto as EXHIBIT F (a "REVOLVING LOAN BORROWING NOTICE"), not later
than 11:00 a.m. (Charlotte time) (i) on the Revolving Loan Borrowing Date for
each Floating Rate Advance and (ii) at least three Business Days before the
Revolving Loan Borrowing Date for each Eurodollar Advance specifying:

     (a)       the Revolving Loan Borrowing Date, which shall be a Business
Day, of such Advance;

     (b)       the aggregate amount of such Advance;

     (c)       the Type of such Advance; and

     (d)       in the case of each Eurodollar Advance, the Interest Period
applicable thereto.

Not later than the Specified Remittance Time on each Revolving Loan Borrowing
Date, each Lender shall make available its Revolving Loan or Revolving Loans
to the Agent in immediately available funds at the relevant Payment Office.
To the extent that the Agent has received funds from the Lenders as specified
in the preceding sentence, the Agent will make such funds available to the
Borrowers at the relevant Payment Office as promptly as

                                       20
<PAGE>

reasonably practicable (but in any event within two hours) following the
Specified Remittance Time, it being understood that if the relevant Payment
Office is located in Charlotte, the Agent will make the applicable funds
available to the Borrowers by depositing such funds to such account as the
Borrowers shall from time to time designate in a notice delivered to the Agent
executed by an Authorized Officer.

     2.7       CONVERSION AND CONTINUATION OF OUTSTANDING ADVANCES. Floating
Rate Advances shall continue as Floating Rate Advances unless and until such
Floating Rate Advances are converted into Eurodollar Advances or prepaid
pursuant to SECTION 2.5 or SECTION 2.10. Each Eurodollar Advance shall continue
as a Eurodollar Advance until the end of the then applicable Interest Period
therefor, at which time such Eurodollar Advance shall be automatically converted
into a Floating Rate Advance unless the Borrowers shall have given the Agent a
Conversion/Continuation Notice requesting that, at the end of such Interest
Period, such Eurodollar Advance either continue as a Eurodollar Advance of such
Type for the same or another Interest Period or be converted into an Advance of
another Type. Subject to the terms of SECTION 2.6, the Borrowers may elect from
time to time to convert all or any part of an Advance of any Type into the other
Type of Advance; provided that any conversion of any Eurodollar Advance shall be
made on, and only on, the last day of the Interest Period applicable thereto.
The Borrowers shall give the Agent irrevocable notice in the form of EXHIBIT I
hereto (a "CONVERSION/CONTINUATION NOTICE") of each conversion of an Advance or
continuation of a Eurodollar Advance not later than 11:00 a.m. (Charlotte time)
(i) in the case of a conversion into a Floating Rate Advance on the date of such
conversion and (ii) in the case of a conversion into or continuation of a
Eurodollar Advance, at least three Business Days before the date of such
conversion or continuation specifying:

     (a)       the requested date, which shall be a Business Day, of such
conversion or continuation;

     (b)       the aggregate amount and Type of the Advance which is to be
converted or continued; and

     (c)       the amount and Type(s) of Advance(s) into which such Advance is
to be converted or continued and, in the case of a conversion into or
continuation of a Eurodollar Advance, the duration of the Interest Period
applicable thereto. Anything contained herein to the contrary notwithstanding,
no more than five Eurodollar Advances shall be outstanding at any time.

     2.8       PAYMENT OF INTEREST ON REVOLVING LOANS AND ADVANCES. Interest
accrued on each Floating Rate Advance shall be payable on the last Business Day
of each calendar month for the month then ending, the Commitment Termination
Date, the date of the reduction to zero of the Aggregate Commitment pursuant to
SECTION 2.10, the date of any repayment of such Floating Rate Advance, and the
date of the acceleration of the Obligations pursuant to SECTION 9.1. Interest
accrued on each Eurodollar Advance shall be payable on the last day of its
applicable Interest Period, on any date on which the Eurodollar Advance is
prepaid, whether by acceleration or otherwise, and at maturity. Interest on
Floating Rate Advances shall be calculated for actual days elapsed on the basis
of a 365/366-day year. Interest on Eurodollar Advances shall be calculated for
actual days elapsed on the basis of a 360-day year. Interest shall be payable
for the day an Advance is made but not for the day of any payment on the amount
paid if payment is received prior to 1:00 p.m. (Charlotte time) at the place of
payment. If any payment of principal of or interest on an Advance shall become
due on a day which is not a Business Day, such payment shall be made on the next
succeeding Business Day and, in the case of a principal payment, such extension
of time shall be included in computing interest in connection with such payment.

                                       21
<PAGE>

     2.9       CHANGES IN INTEREST RATE, ETC. Subject to SECTION 2.11, each
Floating Rate Advance shall bear interest on the outstanding principal amount
thereof, for each day from and including the date such Advance is made or is
converted from a Eurodollar Advance into a Floating Rate Advance pursuant to
SECTION 2.7 to but excluding the date it becomes due or is converted into a
Eurodollar Advance pursuant to SECTION 2.7, at a rate per annum equal to the
Floating Rate for such day. Changes in the rate of interest on each Advance
maintained as a Floating Rate Advance will take effect simultaneously with each
change in the Alternate Base Rate. Each Eurodollar Advance shall bear interest
from and including the first day of the Interest Period applicable thereto to
(but not including) the last day of such Interest Period at the interest rate
determined as applicable to such Eurodollar Advance. No Interest Period may end
after the Commitment Termination Date.

     2.10      FEES, MANDATORY REPAYMENTS AND VOLUNTARY AND MANDATORY
REDUCTIONS IN AGGREGATE COMMITMENT.

     (a)       FEES. The Borrowers agree, jointly and severally, to pay to the
Agent for the account of each Lender a commitment fee of 0.50% per annum on the
daily unused portion of such Lender's Commitment from the Closing Date to but
excluding the earlier of the Commitment Termination Date and the date of the
reduction to zero of the Aggregate Commitment pursuant to this Section 2.10.
Such commitment fees shall be payable on the last Business Day of each calendar
month for the calendar month then ending, and on the earlier of the Commitment
Termination Date and the date of the reduction to zero of the Aggregate
Commitment pursuant to this Section 2.10. Commitment fees shall be calculated
for actual days elapsed on the basis of a 360 day year. All fees shall be paid
on the dates due in immediately available funds to the Agent for the respective
accounts of the Agent and the Lenders as provided herein and in the letter
agreement dated April 19, 2000 between the Agent and the Company (the "FEE
LETTER").

     (b)       MANDATORY PREPAYMENTS. The Revolving Loans shall be prepaid in
the amounts and under the circumstances set forth below, all such prepayments to
be applied as set forth below.

               (i)  PREPAYMENTS FROM NET ASSET SALE PROCEEDS. No later than the
     fifth Business Day following the date of receipt by any Borrower or any of
     its Subsidiaries of any Net Asset Sale Proceeds in respect of any Asset
     Sale, the Borrowers shall prepay the Revolving Loans in an aggregate amount
     equal to the amount of such Net Asset Sale Proceeds.

              (ii)  PREPAYMENTS FROM NET INSURANCE/CONDEMNATION PROCEEDS. No
     later than the fifth Business Day following the date of receipt by the
     Agent or by any Borrower or any of its Subsidiaries of any Net
     Insurance/Condemnation Proceeds, the Borrowers shall prepay the Revolving
     Loans in an aggregate amount equal to the amount of such Net
     Insurance/Condemnation Proceeds.

             (iii)  PREPAYMENTS FROM CASH BALANCES. On the second Business Day
     of each week, the Borrowers shall prepay outstanding Revolving Loans in an
     amount equal to the excess of (x) the amount of the Cash Balances of the
     Borrowers in the Borrower Concentration Account as of the immediately
     preceding Friday (or, if such day is not a Business Day, the immediately
     preceding Thursday) over (y) $20,000,000.

              (iv)  CALCULATIONS OF NET PROCEEDS AMOUNTS; ADDITIONAL PREPAYMENTS
     BASED ON SUBSEQUENT CALCULATIONS. Concurrently with any prepayment of the
     Loans pursuant to SECTIONS 2.10(b)(i)-(iii), the Borrowers shall

                                       22
<PAGE>

     deliver to the Agent a certificate of an Authorized Officer demonstrating
     the calculation of the amount (the "NET PROCEEDS AMOUNT") of the applicable
     Net Asset Sale Proceeds or Net Insurance/Condemnation Proceeds, the
     applicable Net Tax or Pension Proceeds, or the applicable Cash Balance, as
     the case may be, that gave rise to such prepayment and/or reduction. In the
     event that the Borrowers shall subsequently determine that the actual Net
     Proceeds Amount was greater than the amount set forth in such certificate,
     the Borrowers shall promptly make an additional prepayment of the Loans in
     an amount equal to the amount of such excess, and the Borrowers shall
     concurrently therewith deliver to the Agent a certificate of an Authorized
     Officer demonstrating the derivation of the additional Net Proceeds Amount
     resulting in such excess.

     (c)       PREPAYMENTS DUE TO REDUCTIONS OR RESTRICTIONS OF AGGREGATE
COMMITMENT. The Borrowers shall from time to time prepay the Revolving Loans to
the extent necessary (1) so that the Total Utilization of Commitments shall not
at any time exceed the Aggregate Commitment then in effect and (2) to give
effect to the other limitations set forth in the penultimate sentence of SECTION
2.1.

     (d)       ALLOCATION OF PREPAYMENTS AND REDUCTIONS. Any amounts required
to be applied as repayments of Revolving Loans under SECTION 2.10(b)(i) - (iii)
shall be applied to repay outstanding Revolving Loans to the full extent thereof
without permanently reducing the Aggregate Commitment. Any prepayment of the
Revolving Loans shall be allocated ratably among the Lenders according to their
respective Commitments; it being understood that each Borrower shall be liable
pursuant to SECTION 3.4 to indemnify each Lender against any loss or liability
which that Lender incurs as a consequence of any prepayment under this SECTION
2.10.

     (e)       VOLUNTARY REDUCTIONS OF AGGREGATE COMMITMENT. The Borrowers may
permanently reduce the Aggregate Commitment in whole, or in part ratably among
the Lenders in integral multiples of $10,000,000, upon at least three Business
Days' written notice to the Agent, which notice shall specify the amount of any
such reduction; PROVIDED, HOWEVER, the amount of the Aggregate Commitment may
not be reduced below the sum of the aggregate principal amount of the
outstanding Advances and the aggregate outstanding L/C Obligations.

     2.11      RATES APPLICABLE AFTER DEFAULT. Notwithstanding anything to the
contrary contained in SECTION 2.6 or 2.7, during the continuance of a Default or
Unmatured Default no Advance may be made as, converted into or continued as a
Eurodollar Advance. During the continuance of a Default pursuant to SECTION 8.2,
(a) each Eurodollar Advance shall bear interest until paid in full or converted
to a Floating Rate Advance at the Eurodollar Rate then applicable to such
Advance plus 2.0% per annum, and (b) each Floating Rate Advance shall bear
interest until paid in full at a rate per annum equal to the Floating Rate plus
2.0% per annum.

     2.12      METHOD OF PAYMENT. Without limiting the operation of the first
sentence of SECTION 2.19.3(b), and without limiting the scope of SECTION
2.17(b), all payments of the Obligations hereunder shall be made, without
setoff, deduction, or counterclaim, in Dollars in immediately available funds to
the Agent at the Payment Office, by the Specified Remittance Time on the date
when due and shall be remitted by the Agent to the Lenders according to their
respective interests therein. Each payment delivered to the Agent for the
account of any Lender shall be delivered promptly by the Agent to such Lender in
the same type of funds that the Agent received at such Lender's address
specified pursuant to ARTICLE XIV or at any Lending Installation specified in a
notice received by the Agent from such Lender. The Agent is hereby authorized,
but is not obligated, to charge the accounts of the Borrowers maintained with
First Union into which

                                       23
<PAGE>

proceeds of Advances are remitted pursuant to SECTION 2.6 for each payment of
interest and fees as it becomes due hereunder, for each payment of principal, in
accordance with the applicable Prepayment Notice or when otherwise due and
payable in accordance with the terms hereof, and for each payment of Obligations
(including Reimbursement Obligations) when due and payable in accordance with
the terms hereof.

     2.13      EVIDENCE OF DEBT; TELEPHONIC NOTICES. (a) Each Lender shall
maintain in accordance with its usual practice an account or accounts evidencing
the Obligations of the Borrowers to the appropriate Lending Installation of such
Lender resulting from each Revolving Loan made by such Lending Installation of
such Lender from time to time, including the amounts of principal and interest
payable and paid to such Lending Installation of such Lender from time to time
under this Agreement.

     (b)       The Agent shall maintain a Register at the request of the
Borrowers pursuant to SECTION 13.3.2, and a subaccount for each Lender, in which
Register and subaccounts (taken together) shall be recorded (i) the amount of
each Revolving Loan made hereunder, whether such Revolving Loan is, as
applicable, a Eurodollar Loan or a Floating Rate Loan, and the Interest Period
applicable to any Eurodollar Loan, (ii) the amount of any principal or interest
due and payable or to become due and payable from the Borrowers to each Lender
hereunder, and (iii) the amount of any sum received by the Agent hereunder from
the Borrowers and each Lender's share thereof.

     (c)       The entries made in the Register, accounts and subaccounts
maintained pursuant to PARAGRAPHS (a) and (b) of this SECTION 2.13 shall, to the
extent permitted by applicable law, be PRIMA FACIE evidence of the existence and
amounts of the Obligations of the Borrowers therein recorded; PROVIDED, that the
failure of any Lender or the Agent to maintain such account, such Register or
such subaccount, as applicable, or any error therein, shall not in any manner
affect the obligation of the Borrowers to repay the Revolving Loans (and all
other amounts owing with respect thereto) in accordance with the terms of this
Agreement.

     (d)       The Borrowers hereby authorize the Lenders and the Agent to
extend, convert or continue Advances and effect selections of Types of Advances
based on telephonic notices made by any person or persons the Agent in good
faith believes to be acting on behalf of the Borrowers, PROVIDED that the
proceeds of such Advances shall only be credited to such account as the
Borrowers shall from time to time designate in a notice delivered to the Agent
executed by an Authorized Officer. The Borrowers agree to deliver promptly to
the Agent a written confirmation of each telephonic notice signed by an
Authorized Officer. If the written confirmation differs in any material respect
from the action taken by the Agent and the Lenders, the records of the Agent of
the relevant telephonic notice shall govern absent manifest error.

     2.14      NOTIFICATION OF ADVANCES, INTEREST RATES, PREPAYMENTS AND
COMMITMENT REDUCTIONS. Promptly after receipt thereof, the Agent will notify
each Lender of the contents of each Aggregate Commitment reduction notice,
Revolving Loan Borrowing Notice, Conversion/Continuation Notice and prepayment
notice received by it hereunder. The Agent will notify the Borrowers and each
Lender of the interest rate applicable to each Eurodollar Advance promptly upon
determination of such interest rate and will give the Borrowers and each Lender
prompt notice of each change in the Alternate Base Rate.

     2.15      LENDING INSTALLATIONS. Each Lender may book its Revolving Loans
and its L/C Interest at any one or more Lending Installations selected by such
Lender and may change any such Lending Installation from time to time. All terms
of this Agreement shall apply to any such Lending Installation and the Revolving
Loans and the L/C Interests shall be deemed held by each Lender for the benefit
of such Lending Installation. Each

                                       24
<PAGE>

Lender may, by written or telex notice to the Agent and the Borrowers, designate
a Lending Installation through which Revolving Loans will be made by it and
through which L/C Interests will be held by it and for whose account Revolving
Loan payments and L/C Obligation payments are to be made.

     2.16      NON-RECEIPT OF FUNDS BY THE AGENT. Unless the Borrowers or a
Lender, as the case may be, notifies the Agent prior to the date on which it is
scheduled to make payment to the Agent of (a) in the case of a Lender, the
proceeds of a Revolving Loan or (b) in the case of the Borrowers, a payment of
principal, interest or fees to the Agent for the account of the Lenders, that it
does not intend to make such payment, the Agent may assume that such payment has
been made. The Agent may, but shall not be obligated to, make the amount of such
payment available to the intended recipient in reliance upon such assumption. If
such Lender or the Borrowers, as the case may be, has not in fact made such
payment to the Agent, the recipient of such payment shall, on demand by the
Agent, repay to the Agent the amount so made available together with interest
thereon in respect of each day during the period commencing on the date such
amount was so made available by the Agent until the date the Agent recovers such
amount at a rate per annum equal to (a) in the case of payment by a Lender, the
Federal Funds Effective Rate for such day or (b) in the case of payment by the
Borrowers, the interest rate applicable to the relevant Revolving Loan.

     2.17      WITHHOLDING TAX EXEMPTION; GROSS UP. (a) At least five Business
Days prior to the first date on which interest or fees are payable hereunder for
the account of any Lender, each Lender that is not incorporated under the laws
of the United States of America, or a state thereof, agrees that it will deliver
to the Company and the Agent two duly completed copies of United States Internal
Revenue Service Form 1001 or 4224, certifying in either case that such Lender is
entitled to receive payments under this Agreement without deduction or
withholding of any United States federal income taxes. Each Lender which so
delivers a Form 1001 or 4224 further undertakes to deliver to the Borrowers and
the Agent two additional copies of such form (or any successor form or related
form as may from time to time be required under applicable law) on or before the
date that such form expires (currently, three successive calendar years for Form
1001 and one calendar year for Form 4224) or becomes obsolete or after the
occurrence of any event requiring a change in the most recent forms so delivered
by it, and such amendments thereto or extensions or renewals thereof as may be
reasonably requested by the Borrowers or the Agent, in each case certifying that
such Lender is entitled to receive payments under this Agreement without
deduction or withholding of any United States federal income taxes, unless an
event (including without limitation any change in treaty, law or regulation) has
occurred prior to the date on which any such delivery would otherwise be
required which renders all such forms inapplicable or which would prevent such
Lender from duly completing and delivering any such form with respect to it and
such Lender advises the Borrowers and the Agent that it is not capable of
receiving payments without any deduction or withholding of United States federal
income tax.

     (b)       All payments made by the Borrowers under or in connection with
this Agreement shall be made in full, without set-off or counterclaim, and free
of and without deduction or withholding for or on account of any present or
future tax, duty, assessment, impost, levy or other similar charge, or any
penalties, fines or interest thereon (a "RELEVANT TAX") imposed upon TLGI, any
Borrower, the Agent, any Lender or the L/C Issuer by the government of Canada
(or any Governmental Authority thereof), the government of the United States of
America (or any Governmental Authority thereto, or by the government of any
other country or jurisdiction (or any Governmental Authority

                                       25
<PAGE>

thereof) from or through which payments hereunder are actually made (each a
"TAXING JURISDICTION"). The Borrowers, for the benefit of the Agent, the Lenders
and the L/C Issuer, agree that in the event any payments made by the Borrowers
hereunder or in connection herewith are subject to any deduction or withholding
for or on account of any Relevant Tax, the Borrowers, jointly and severally,
will pay to the Agent, such Lender or the L/C Issuer such additional amounts as
may be necessary in order that the net amounts paid to the Agent, such Lender or
the L/C Issuer pursuant to the terms of this Agreement after imposition of any
such Relevant Tax (including deductions or withholdings applicable to additional
amounts paid under this SECTION 2.17(b)) shall be not less than the amounts
specified in this Agreement to be then due and payable, except that no such
additional amounts shall be payable hereunder to the Agent, any Lender or the
L/C Issuer that is liable for such Relevant Tax in respect of the relevant
payment solely by reason of such recipient (a) having a permanent establishment
in the Taxing Jurisdiction, (b) being organized under the laws of the Taxing
Jurisdiction or any political subdivision thereof, (c) being resident in the
Taxing Jurisdiction by virtue of its domicile or place of management being in
the Taxing Jurisdiction, or (d) having failed to comply with the terms and
conditions of SECTION 2.17(a) applicable to it. If the Agent, any Lender or the
L/C Issuer pays any amount in respect of a Relevant Tax, the Borrowers shall,
jointly and severally, indemnify the Agent, the Lender or the L/C Issuer, as the
case may be, for such payment within 15 days of demand therefor by the Agent,
such Lender or the L/C Issuer (in the case of such Lender or the L/C Issuer,
made through the Agent).

     2.18      TERMINATION. All unpaid Obligations shall be paid in full by the
Borrowers on the Commitment Termination Date; PROVIDED, HOWEVER, that nothing in
this SECTION 2.18 shall be construed as limiting or modifying the joint and
several obligations of the Borrowers to repay any or all of the outstanding
Obligations at any earlier time in accordance with the terms of this Agreement.

     2.19      LETTER OF CREDIT FACILITY.

     2.19.1    LETTERS OF CREDIT Upon receipt of duly executed applications
therefor, and such other documents, instruments and agreements as the L/C Issuer
may reasonably require, and subject to the provisions of ARTICLE IV, the L/C
Issuer shall issue Standby Letters of Credit and Commercial Letters of Credit
for account of the Borrowers, on terms as are satisfactory to the L/C Issuer;
PROVIDED, HOWEVER, that no Letter of Credit will be issued for the account of
the Borrowers by the L/C Issuer if on the date of issuance, before or after
taking such Letter of Credit into account (i) the amount of the Advances and the
L/C Obligations at such time would exceed the Aggregate Commitment or (ii) the
aggregate outstanding amount of the L/C Obligations would exceed the L/C
Commitment Amount; PROVIDED, FURTHER, that no Letter of Credit shall be issued
unless it has an expiration date that is (1) in the case of a Standby Letter of
Credit, no more than one year after the date of issuance of such Letter of
Credit (provided that a Standby Letter of Credit, subject to the immediately
following, may provide for an annual renewal if such renewal is consented to
by the L/C Issuer at the time of issuance and the conditions precedent to the
issuance of such Standby Letter of Credit are met at the time of such renewal),
(2) in the case of a Standby Letter of Credit, no later than the date which is
five Business Days immediately preceding the Stated Maturity Date, (3) in the
case of a Commercial Letter of Credit, no more than 180 days from the date of
issuance of such Commercial Letter of Credit, and (4) in the case of a
Commercial Letter of Credit, no later than the date which is 10 days immediately
preceding the Stated Maturity Date; and PROVIDED, FURTHER, that no Letter of
Credit shall be issued in CDN$ or for use in support of an obligation of TLGI or
a Canadian Subsidiary unless (x) TLGI or such Canadian

                                       26
<PAGE>

Subsidiary, as the case may be, shall have entered into an agreement to
reimburse the applicable L/C Issuer and the Lenders for obligations arising with
respect to drawings under such Letter of Credit, (y) the reimbursement
obligation of TLGI or such Canadian Subsidiary, as applicable, under such
agreement shall be approved by the Canadian Court, and (z) the reimbursement
obligation of TLGI or such Canadian Subsidiary, as applicable, under such
agreement shall be a priority claim in the Canadian Cases.

     2.19.2    LETTER OF CREDIT PARTICIPATION. Immediately upon issuance of each
Letter of Credit by the L/C Issuer hereunder, each Lender shall be deemed to
have automatically, irrevocably and unconditionally purchased and received from
the L/C Issuer an undivided interest and participation in and to such Letter of
Credit, the obligations of the Borrowers in respect thereof, and the liability
of the L/C Issuer thereunder (collectively, an "L/C INTEREST") in an amount
equal to the amount available for drawing under such Letter of Credit (which
amount, in the case of a Letter of Credit which is denominated in a currency
other than Dollars, shall be calculated by reference to the applicable Exchange
Rate) multiplied by a fraction having as its numerator, such Lender's
Commitment, and as its denominator, the Aggregate Commitment. The L/C Issuer
will notify each Lender promptly upon presentation to it of an L/C Draft or upon
any other draw under any Letter of Credit. On the Business Day on which the L/C
Issuer makes payment of any L/C Draft or, in the case of any other draw on the
Letter of Credit, on demand of the L/C Issuer (provided that the Borrowers have
not prior thereto made payment therefor and no Floating Rate Advance has been
made pursuant to SECTION 2.19.3 with respect thereto), each Lender shall make
payment to the Agent, for credit to the L/C Issuer, in immediately available
funds in an amount equal to such Lender's ratable share (determined in
accordance with the fraction described above) of the amount of such payment or
draw (which amount, in the case of a drawing under a Letter of Credit which is
denominated in a currency other than Dollars, shall be calculated by reference
to the applicable Exchange Rate). Provided that each Letter of Credit is issued
by the L/C Issuer in accordance with the terms of this Agreement, the obligation
of each Lender to reimburse the L/C Issuer under this SECTION 2.19.2 shall be
unconditional, continuing, irrevocable and absolute and shall not be affected or
impaired by, among other things, the occurrence of the Commitment Termination
Date or the reduction, suspension or termination (except pursuant to SECTION
2.18) of the Aggregate Commitment or such Lender's Commitment in accordance with
the terms of this Agreement. In the event that any Lender fails to make payment
to the Agent of any amount due to the L/C Issuer under this SECTION 2.19.2, the
Agent shall be entitled to receive for the benefit of the L/C Issuer, and the
L/C Issuer shall be entitled to receive, retain and apply against such
obligation the principal and interest and other amounts otherwise payable to
such Lender hereunder (whether in respect of Revolving Loans, Letters of Credit
or otherwise) until the Agent receives such payment from such Lender or such
obligation is otherwise fully satisfied; PROVIDED, HOWEVER, that nothing
contained in this sentence shall relieve such Lender of its obligation to
reimburse the L/C Issuer for such amount in accordance with this SECTION 2.19.2.

     2.19.3    REIMBURSEMENT OBLIGATION. (a) The Borrowers agree
unconditionally, irrevocably and absolutely to pay immediately to the Agent, for
the account of the L/C Issuer and the Lenders, the amount of each L/C Draft or
other demand which may be drawn under or pursuant to a Letter of Credit (such
obligation of the Borrowers to pay the Agent (for the account of the L/C Issuer
and the Lenders) being hereinafter referred to as a "REIMBURSEMENT OBLIGATION"
with respect to a Letter of Credit or L/C Draft) (which amount, in the case of a
drawing under a Letter of Credit which is denominated in a currency other than
Dollars, shall be calculated by reference to the

                                       27
<PAGE>

applicable Exchange Rate). The obligations of the Borrowers under this Agreement
and otherwise in respect of Letters of Credit and L/C Drafts shall be absolute,
unconditional and irrevocable and shall be performed strictly in accordance with
the terms of this Agreement under all circumstances whatsoever, including the
following circumstances:

               (i)  any lack of validity or enforceability of any Letter of
     Credit, this Agreement or any Loan Document;

              (ii)  any amendment or waiver of or any consent to departure from
     this Agreement or any other Loan Document;

             (iii)  the existence of any claim, set-off, defense or other right
     which any Borrower may have at any time against the L/C Issuer, the Agent,
     any Lender, any beneficiary of any Letter of Credit (or any Person for whom
     any such beneficiary may be acting), or any other Person, whether in
     connection with this Agreement, any other Loan Document or any unrelated
     transactions;

              (iv)  any statement in any certificate or any other document
     presented under any Letter of Credit proving to be forged, fraudulent,
     invalid or insufficient in any respect or any such statement being untrue
     or inaccurate in any respect whatsoever;

               (v)  payment by the L/C Issuer under any Letter of Credit against
     presentation of a draft or certificate which does not comply with the terms
     of such Letter of Credit (provided that the L/C Issuer was not grossly
     negligent in connection therewith); or

              (vi)  any other circumstance or happening whatsoever, whether or
     not similar to any of the foregoing.

     (b)       If the Borrowers at any time fail to repay a Reimbursement
Obligation pursuant to this SECTION 2.19.3, the Borrowers shall be deemed to
have elected to borrow a Floating Rate Advance from the Lenders, as of the
date of the L/C Draft or other demand giving rise to the Reimbursement
Obligation, equal in amount to the amount of the unpaid Reimbursement
Obligation, the proceeds of which Advance shall be used to repay such
Reimbursement Obligation; PROVIDED, HOWEVER, that such Floating Rate Advance
shall be deemed to have been borrowed only to the extent that (x) both
immediately before and after giving effect thereto, no Default or Unmatured
Default under SECTION 8.6 shall have occurred and be continuing, and (y) the
Commitment Termination Date (or the date of any earlier termination of the
Aggregate Commitment pursuant to this Agreement) shall not have occurred prior
thereto. For each Reimbursement Obligation for which a Floating Rate Advance is
not deemed to have been borrowed by the Borrowers, each Lender shall be deemed
to have automatically purchased and received from the L/C Issuer an undivided
interest and participation in and to such Reimbursement Obligation in an amount
equal to such Reimbursement Obligation multiplied by a fraction having as its
numerator, such Lender's Commitment, and as its denominator, the Aggregate
Commitment. If, for any reason, the Borrowers fail to repay a Reimbursement
Obligation on the day such Reimbursement Obligation arises, either directly or
through a Floating Rate Advance, then such Reimbursement Obligation shall bear
interest from and after such day, until paid in full, at the interest rate
applicable to Floating Rate Advances (including, during the continuance of a
Default or Unmatured Default, at the rates determined pursuant to SECTION 2.11).

     2.19.4    CASH COLLATERAL. Notwithstanding anything to the contrary herein
or in any application for any Letter of Credit, after the occurrence and during
the continuance of a Default, the Borrowers shall, upon the demand of the
Required Lenders or the Agent at the request of the Required Lenders, deliver to
the Agent for the benefit of the L/C Issuer and the Lenders, cash collateral in
an amount equal to the aggregate

                                       28
<PAGE>

outstanding L/C Obligations. Any such collateral shall be held by the Agent in a
separate account appropriately designated as a cash collateral account in
relation to this Agreement and the Letters of Credit and retained by the Agent
for the benefit of the L/C Issuer and the Lenders as collateral security for the
Borrowers' obligations in respect of this Agreement and the Letters of Credit
and L/C Drafts. Such amounts shall be applied to reimburse the L/C Issuer for
drawings or payments under or pursuant to the Letters of Credit or L/C Drafts,
or if no such reimbursement is required, such amounts shall be applied ratably
to the payment of any other unpaid costs, fees, expenses and other Obligations
related to the Letters of Credit, any L/C Drafts and such cash collateral
account as the Agent shall determine. If no Default shall be continuing, amounts
remaining in any cash collateral account established pursuant to this Section
2.19.4 which are not to be applied to reimburse the L/C Issuer or the Lenders
for amounts actually paid or to be paid by the L/C Issuer or the Lenders in
respect of the Letters of Credit or L/C Drafts, shall be returned to the
Borrowers (after deduction of the Agent's expenses incurred in connection with
such cash collateral account). Investment earnings (net of investment losses and
any unpaid costs, fees, expenses and other Obligations related to the Letters of
Credit, any L/C Drafts and such cash collateral account) on amounts on deposit
in the cash collateral account (which investments shall be limited to interest
bearing deposit accounts with the Agent) shall be for the account of the
Borrowers, and, except at such time as a Default shall have occurred and be
continuing, the Agent shall remit any such accrued earnings to the Borrowers no
less frequently than quarterly.

     2.19.5    LETTER OF CREDIT FEES. The Borrowers agree to pay (a) to the
Agent for the ratable benefit of the Lenders, a letter of credit fee equal to
2.75% per annum on the daily sum of (x) the aggregate outstanding amount of L/C
Obligations less (y) the aggregate outstanding amount of Reimbursement
Obligations, such fee to be paid in arrears on the last Business Day of each
calendar month for the month then ending, and on the Commitment Termination
Date, and such fee to be calculated for actual days elapsed on the basis of a
360-day year, and (b) to the Agent for the benefit of the L/C Issuer, as issuing
bank, with respect to any Letter of Credit, a fronting fee, payable on the date
of issuance of such Letter of Credit, equal to 0.25% of the maximum amount
available to be drawn under such Letter of Credit, together with all customary
fees and other issuance, amendment, negotiation, presentment and payment
expenses and related charges in connection with the issuance, amendment,
negotiation, presentation and payment of L/C Drafts, and the like customarily
charged by the L/C Issuer with respect to standby letters of credit, payable at
the time of invoice of such amounts by the L/C Issuer. Any amount described in
this SECTION 2.19.5 which is denominated in a currency other than Dollars shall
be valued based on the applicable Exchange Rate for such currency as of the
applicable date of determination

     2.19.6    INDEMNIFICATION, EXONERATION (a) In addition to amounts payable
as elsewhere provided in this Agreement, the Borrowers hereby agree, jointly and
severally, to protect, indemnify, pay and save harmless the L/C Issuer, each
Lender and the Agent from and against any and all liabilities and costs which
the L/C Issuer, any Lender or the Agent may incur or be subject to as a
consequence, direct or indirect, of (i) the issuance of any Letter of Credit
other than, in the case of the L/C Issuer, as a result of its gross negligence
or willful misconduct, as determined by the final judgment of a court of
competent jurisdiction, or (ii) the failure of the L/C Issuer to honor a drawing
under any Letter of Credit as a result of any act or omission, whether rightful
or wrongful, of any present or future de jure or de facto governmental authority
(all such acts or omissions herein called "GOVERNMENTAL ACTS").

     (b)       As among the Borrowers, the L/C Issuer, the Lenders and the

                                       29
<PAGE>

Agent, the Borrowers, jointly and severally, assume all risks of the acts and
omissions of, or misuse of a Letter of Credit by, the beneficiary of any Letter
of Credit. In furtherance and not in limitation of the foregoing, subject to the
provisions of the letter of credit application and any letter of credit
reimbursement agreement submitted or executed by the Borrowers in connection
with any Letter of Credit (except to the extent otherwise provided in PARAGRAPH
(E) of this SECTION 2.19.6), the L/C Issuer, the Lenders and the Agent shall not
be responsible (in the absence of gross negligence or willful misconduct in
connection therewith): (i) for the form, validity, sufficiency, accuracy,
genuineness or legal effect of any document submitted by any party in connection
with the application for and issuance of any Letter of Credit, even if it should
in fact prove to be in any or all respects invalid, insufficient, inaccurate,
fraudulent or forged; (ii) for the validity or sufficiency of any instrument
transferring or assigning or purporting to transfer or assign any Letter of
Credit or the rights or benefits thereunder or proceeds thereof, in whole or in
part, which may prove to be invalid or ineffective for any reason; (iii) for
failure of the beneficiary of any Letter of Credit to comply duly with
conditions required in order to draw upon any Letter of Credit; (iv) for errors,
omissions, interruptions or delays in transmission or delivery of any messages,
by mail, cable, telegraph, telecopy; telex or other similar form of
teletransmission or otherwise; (v) for errors in interpretation of technical
trade terms; (vi) for any loss or delay in the transmission or otherwise of any
document required in order to make a drawing under any Letter of Credit or of
the proceeds thereof; (vii) for the misapplication by the beneficiary of any
Letter of Credit of the proceeds of any drawing under any Letter of Credit; and
(viii) for any consequences arising from causes beyond the control of the L/C
Issuer, the Lenders and the Agent including, without limitation, any
Governmental Acts. None of the above shall affect, impair or prevent the vesting
of any rights or powers of the L/C Issuer under this SECTION 2.19.6.

     (c)       In furtherance and extension and not in limitation of the
specific provisions hereinabove set forth, any action taken or omitted by the
L/C Issuer under or in connection with a Letter of Credit issued on behalf of
the Borrowers or any related certificates shall not, in the absence of gross
negligence or willful misconduct, as determined by the final judgment of a court
of competent jurisdiction, put the L/C Issuer, any Lender or the Agent under any
resulting liability to the Borrowers or relieve the Borrowers, or any of them,
of any of their obligations hereunder to any such Person.

     (d)       Without prejudice to the survival of any other agreement of any
Borrower hereunder, the agreements and obligations of the Borrowers contained in
this SECTION 2.19.6 shall survive the payment in full of principal, interest and
all other amounts hereunder, the termination of the Letters of Credit and the
termination of this Agreement.

     (e)       Notwithstanding anything therein to the contrary, in the event
any of the provisions of any letter of credit application or letter of credit
reimbursement agreement submitted or executed by the Borrowers in connection
with any Letter of Credit conflict with the provisions of this Agreement, the
terms of this Agreement shall govern.

     2.19.7    LETTER OF CREDIT CANCELLATION. For all purposes hereunder,
including (without limitation) SECTION 2.19.5, a Letter of Credit shall be
deemed outstanding until the earlier to occur of (i) the occurrence of the date
expressly designated therein as the expiration date for such Letter of Credit
and (ii) the physical receipt by the L/C Issuer of such Letter of Credit marked
"canceled" accompanied by evidence from the beneficiary thereof satisfactory to
the L/C Issuer to such effect.

     2.19.8    ASSUMPTION OF EXISTING LETTERS OF CREDIT. Subject to the terms
and conditions and relying upon the representations, warranties and covenants
set forth herein, each of the parties hereto agrees that, as of the Closing
Date, the letters of credit issued

                                       30
<PAGE>

under the Existing DIP Credit Agreement identified on Schedule 2.19.8 hereto are
hereby deemed assumed by the Borrowers and restructured as and deemed to be
Letters of Credit hereunder.

     2.20      SUPERPRIORITY AND SECURED NATURE OF OBLIGATIONS.

     Upon entry of the Borrowing Order:

     (a)       pursuant to Section 364(c)(1) of the Bankruptcy Code, all
Obligations under the Loan Documents shall at all times constitute allowed
administrative expense claims in the Chapter 11 Cases having priority over all
administrative expenses of the kind specified or ordered pursuant to any
provision of the Bankruptcy Code, including, but not limited to, Sections 105,
326, 328, 503(b), 506(c), 507(a), 516(c), 517(a), 507(b) and 726 of the
Bankruptcy Code, which claims (and the Liens granted to secure such claims)
shall be subordinate only to a carve-out (the "CARVE-OUT") for (x) the payment
of professional fees and disbursements allowed by order of the Bankruptcy Court
and incurred by the Borrowers (excluding fees and disbursements of "ordinary
course" professionals as approved by the U.S. Court), any official committee of
unsecured creditors appointed in the Chapter 11 Cases, any disbursements of any
member of such committee and any Chapter 7 trustee appointed for the Credit
Parties in an aggregate amount not to exceed $10,000,000 and (y) fees payable to
the U.S. Trustee pursuant to U.S.C. Section 1930(a)(6) and any fees payable
to the clerk of the U.S. Court; and provided further, that no part of the
Carve-Out may be used to pay professional fees and expenses incurred (i) to
object to or contest, in any manner, or raise any defenses to, or investigate,
the validity, perfection, priority or enforceability of the obligations under
the Existing Revolver Agreement (the "PREPETITION OBLIGATIONS") or the Liens on
the collateral securing the Prepetition Obligations or (ii) to investigate or
assert any claims or causes of action against the Agent, the Lenders or the
administrative agent or the lenders under such Existing Revolver Agreement. The
Lenders agree that the Borrowers shall be permitted to pay compensation and
reimbursement of expenses allowed and payable under Sections 330 and 331 of the
Bankruptcy Code, as the same may be due and payable, provided that the aggregate
of any such payments made on or after the occurrence and during the continuance
of a Default shall not exceed the Carve-Out, and PROVIDED FURTHER that
appropriate applications for U.S. Court approval are made therefor, subject to
objection by the Agent or the Lenders, if any, and U.S. Court approval;

     (b)       pursuant to Section 364(c)(2) of the Bankruptcy Code, all
Obligations under the Loan Documents shall at all times be secured by duly
perfected valid, enforceable and nonvoidable first priority Liens on all
unencumbered Collateral; and

     (c)       pursuant to Section 364(c)(3) of the Bankruptcy Code, all
Obligations under the Loan Documents shall be secured by duly perfected valid,
enforceable and nonvoidable junior Liens on all Collateral that is subject only
to valid, perfected and nonvoidable Liens in existence as of the Petition Date.

     Following the Commitment Termination Date, amounts in the cash collateral
account described in SECTION 2.19.4 shall not be subject to the Carve-Out.

     2.21      JOINT AND SEVERAL LIABILITY; PAYMENT INDEMNIFICATIONS.

     (a)       All Obligations of the Borrowers under the Loan Documents shall
be the joint and several Obligations of each Borrower. The Obligations of and
the Liens granted by any such Borrower under the Loan Documents shall not be
impaired or released by any action or inaction on the part of Agent or any
Lender with respect to any other Credit Party, including any action or inaction
which would otherwise release a surety.

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<PAGE>

     (b)       In order to provide for just and equitable contribution between
the Borrowers if any payment is made by any Borrower (a "FUNDING BORROWER") in
discharging any of the Obligations, that Funding Borrower shall be entitled to a
contribution from the other Borrowers for all payments, damages and expenses
incurred by that Funding Borrower in discharging the Obligations, in the manner
and to the extent required to allocate liabilities in an equitable manner among
the Borrowers on the basis of the relative benefits received by the Borrowers.
If and to the extent that a Funding Borrower makes any payment to any Lender or
any other Person in respect of the Obligations, any claim which said Funding
Borrower may have against the other Borrowers by reason thereof shall be subject
and subordinate to the prior cash payment in full of the Obligations. The
parties hereto acknowledge that the right to contribution hereunder shall
constitute an asset of the party to which such contribution is owing.
Notwithstanding any of the foregoing to the contrary, such contribution
arrangements shall not limit in any manner the joint and several nature of the
Obligations, limit, release or otherwise impair any rights of Agent or any
Lender under the Loan Documents, or alter, limit or impair the obligation of
each Borrower, which is absolute and unconditional, to repay the Obligations.
The obligation of any Borrower to make any contribution to another Borrower
under this SECTION 2.21 shall be deemed a superpriority administration expense
obligation of such Borrower arising under Section 503(b) of the Bankruptcy Code
and shall be junior in priority only to the Obligations of such Borrower under
the Loan Documents.

     2.22      SECURITY INTEREST IN CASH COLLATERAL ACCOUNT. Pursuant to
Section 364(c)(2) of the Bankruptcy Code, the Borrowers hereby assign and pledge
to the Agent, for its benefit and for the ratable benefit of the Lenders, and
hereby grant to the Agent, for its benefit and for the ratable benefit of the
Lenders, a first priority security interest, senior to all other Liens, if any,
in all of the Borrowers' right, title and interest in and to the cash collateral
account described in SECTION 2.19.4 and any direct investment of the funds
contained therein.

     2.23      NO DISCHARGE; SURVIVAL OF CLAIMS. Each Borrower agrees that
(i) its obligations hereunder shall not be discharged by the entry of an order
confirming a plan of reorganization (and each Borrower, pursuant to Section
1141(d)(4) of the Bankruptcy Code, hereby waives any such discharge) and (ii)
the superpriority claim granted to the Agent and the Lenders pursuant to the
Borrowing Order and described in SECTION 2.20 and the Liens granted to the Agent
pursuant to the Borrowing Order and described in SECTIONS 2.20 and 2.22 shall
not be affected in any manner by the entry of an order confirming a plan of
reorganization.

                                   ARTICLE III
                             CHANGE IN CIRCUMSTANCES

     3.1       YIELD PROTECTION. If any change in law or any governmental or
quasi-governmental rule, regulation, policy, guideline or directive (whether or
not having the force of law), or any interpretation thereof, or the compliance
of any Lender or the L/C Issuer therewith,

     (a)       subjects any Lender or the L/C Issuer or any applicable Lending
Installation to any tax, duty, charge or withholding on or from payments due
from any Borrower or TLGI or any other Person obligated hereunder to any Lender
or the L/C Issuer (excluding taxation of the overall net income of any Lender or
the L/C Issuer or any applicable Lending Installation or other taxes in lieu of
such taxes imposed by the United States or any jurisdiction in which such Lender
or the L/C Issuer has its principal office or

                                       32
<PAGE>

applicable Lending Installation or is engaged in business), or changes the basis
of taxation of payments to any Lender or the L/C Issuer in respect of its
Revolving Loan, L/C Interests, L/C Obligations or other amounts due it
hereunder; or

     (b)       imposes or increases or deems applicable any reserve, assessment,
insurance charge, special deposit or similar requirement against assets of,
deposits with, or for the account of, or credit extended by, any Lender or the
L/C Issuer or any applicable Lending Installation, (other than reserves and
assessments taken into account in determining the interest rate applicable to
Eurodollar Advances); or

     (c)       imposes any other condition the result of which is to increase
the cost to any Lender or the L/C Issuer or any applicable Lending Installation
of making, funding or maintaining loans or issuing or participating in letters
of credit or reduces any amount receivable by any Lender or the L/C Issuer or
any applicable Lending Installation in connection with loans or letters of
credit, or requires any Lender or the L/C Issuer or any applicable Lending
Installation to make any payment calculated by reference to the amount of loans
or letters of credit held, or interest received by it, by an amount deemed
material by such Lender or the L/C Issuer, as the case may be;

     then, within 15 days of demand by such Lender or the L/C Issuer, the
Borrowers shall pay such Lender or the L/C Issuer that portion of such increased
expense incurred or reduction in an amount received which such Lender or the L/C
Issuer determines is attributable to making, funding and maintaining its
Revolving Loans, L/C Interests, the Letters of Credit, the L/C Obligations and
its Commitment (and in the case of the L/C Issuer, its commitment to issue
Letters of Credit).

     3.2       CHANGES IN CAPITAL ADEQUACY REGULATIONS. If a Lender or the L/C
Issuer determines that the amount of capital required or expected to be
maintained by such Lender or the L/C Issuer, any Lending Installation of such
Lender or any corporation controlling such Lender or the L/C Issuer is increased
as a result of a Change (as defined below in this SECTION 3.2), then, within 15
days of demand by such Lender or the L/C Issuer, the Borrowers shall pay such
Lender or the L/C Issuer the amount necessary to compensate for any shortfall in
the rate of return on the portion of such increased capital which such Lender or
the L/C Issuer determines is attributable to this Agreement, its Revolving
Loans, L/C Interests, the Letters of Credit, the L/C Obligations or its
obligation to make Revolving Loans (or in the case of the L/C Issuer, its
commitment to issue Letters of Credit) or participate in Letters of Credit
hereunder or to issue Letters of Credit (after taking into account such Lender's
or the L/C Issuer's or such controlling corporation's policies as to capital
adequacy). "CHANGE" means (a) any change after the date of this Agreement in the
Risk-Based Capital Guidelines (as defined below in this SECTION 3.2) or (b) any
adoption of or change in any other law, governmental or quasi-governmental rule,
regulation, policy, guideline, interpretation or directive (whether or not
having the force of law) after the date of this Agreement which affects the
amount of capital required or expected to be maintained by any Lender or the L/C
Issuer or any Lending Installation or any corporation controlling any Lender or
the L/C Issuer. "RISK-BASED CAPITAL GUIDELINES" means (a) the risk-based capital
guidelines in effect in the United States on the date of this Agreement,
including transition rules, and (b) the corresponding capital regulations
promulgated by regulatory authorities outside the United States implementing the
July 1988 report of the Basle Committee on Banking Regulation and Supervisory
Practices Entitled "International Convergence of Capital Measurements and
Capital Standards," including transition rules, and any amendments to such
regulations adopted prior to the date of this Agreement.

     3.3       AVAILABILITY OF TYPES OF ADVANCES. If any Lender determines that
maintenance of its Eurodollar Loans at a suitable Lending Installation would
violate any

                                       33
<PAGE>

applicable law, rule, regulation or directive, whether or not having the force
of law, or if the Required Lenders determine that (a) deposits of a type and
maturity appropriate to match fund Eurodollar Advances are not available or (b)
the interest rate applicable to a Eurodollar Advance does not accurately reflect
the cost of making or maintaining such Advance, then the Agent shall suspend the
availability of the affected Eurodollar Advance and require any Eurodollar
Advances to be prepaid or converted into a Floating Rate Advance.

     3.4       FUNDING INDEMNIFICATION. If (i) any payment of a Eurodollar
Advance occurs on a date which is not the last day of the applicable Interest
Period, whether because of acceleration, prepayment or otherwise (including,
without limitation, as a result of a mandatory prepayment of a Eurodollar
Advance pursuant to SECTION 2.10(b) or (ii) as a result of an assignment of a
Lender's Commitment and its outstanding Revolving Loans and L/C Interest by
operation of SECTION 3.5, a Eurodollar Advance made by the assigning Lender is
assigned on a date which is not the last day of the applicable Interest Period,
or (iii) a Eurodollar Advance is not made, continued or converted on the date
specified by the Borrowers for any reason other than default by the Lenders, or
(iv) an optional prepayment, notice of which has been given in accordance with
SECTION 2.5, is not made on the date specified therefor in such notice, the
Borrowers will, jointly and severally, indemnify each Lender for any loss or
cost incurred by it resulting therefrom, including, without limitation, any loss
or cost in liquidating or employing deposits acquired to fund or maintain the
Eurodollar Advance, or in liquidating or terminating prior to scheduled maturity
any foreign exchange contracts, currency swaps or other similar hedging
arrangements entered into in connection with the Eurodollar Advance.

     3.5       MITIGATION; LENDER STATEMENTS; SURVIVAL OF INDEMNITY. (a) To the
extent reasonably possible, each Lender shall designate an alternate Lending
Installation with respect to its Eurodollar Loans to reduce any liability of the
Borrowers to such Lender under SECTIONS 3.1 and 3.2 or to avoid the
unavailability of a Type of Advance under SECTION 3.3, so long as such
designation is rate disadvantageous to such Lender. If the obligation of the
Lenders to make Eurodollar Advances has been suspended pursuant to SECTION 3.3,
as a consequence of a determination by any Lender that maintenance of its
Eurodollar Loans at a suitable Lending Installation would violate any applicable
law or any Lender has demanded compensation under SECTION 3.1 or 3.2, the
Borrowers may elect (i) subject to SECTION 3.4, to prepay any outstanding
Advances to the extent necessary to mitigate its liability under SECTION 3.1 or
3.2, (ii) to terminate the applicable Lender's Commitment hereunder or (iii) to
require the applicable Lender to assign its outstanding Revolving Loans, L/C
Interests and Commitment hereunder to another financial institution designated
by the Borrowers and reasonably acceptable to the Agent; PROVIDED, HOWEVER, that
the Borrowers may make the elections described in the foregoing CLAUSES (i) and
(ii) only at such times as no Default or Unmatured Default shall have occurred
and be continuing. The obligation of a Lender to assign its rights and
obligations hereunder or terminate its Commitment hereunder as contemplated by
this SECTION 3.5(a) is subject to the requirements that (x) all amounts owing to
that Lender under the Loan Documents (including, without limitation, pursuant to
SECTION 3.4 are paid in full upon the completion of such assignment or prior to
such termination and (y) any assignment is effected in accordance with the terms
of SECTION 13.3 and on terms otherwise satisfactory to that Lender.

     (b)       Each Lender or the L/C Issuer, as the case may be, shall deliver
a written statement of such Person as to the amount due, if any, under SECTION
3.1, 3.2 or

                                       34
<PAGE>

3.4. Such written statement shall set forth in reasonable detail the
calculations upon which such Person determined such amount and shall be final,
conclusive and binding on the Borrowers in the absence of manifest error.
Determination of amounts payable under such Sections in connection with a
Eurodollar Loan shall be calculated as though each Lender funded such Eurodollar
Loan through the purchase of a deposit of the type and maturity corresponding to
the deposit used as a reference in determining the interest rate applicable to
such Eurodollar Loan, whether in fact that is the case or not. Unless otherwise
provided herein, the amount specified in the written statement shall be payable
on demand after receipt by the Borrowers of the written statement. The
obligations of the Borrowers under SECTIONS 3.1, 3.2 and 3.4 shall survive
payment of the Obligations and termination of this Agreement.

                                   ARTICLE IV
                              CONDITIONS PRECEDENT

     The effectiveness of this Agreement is subject to the satisfaction of the
conditions precedent set forth below in SECTION 4.1.

     4.1       CLOSING DATE ADVANCES AND LETTERS OF CREDIT. The Lenders shall
be obligated (subject to SECTION 4.2) to make Advances and purchase
participations in the Letters of Credit hereunder on the Closing Date, and the
L/C Issuer shall be obligated (subject to SECTION 4.2) to issue Letters of
Credit hereunder on the Closing Date, only after the Agent shall have received
from the Borrowers, with sufficient copies for the Agent and each of the
Lenders, each of the following items in form and substance satisfactory to the
Agent:

     (a)       to the extent not already provided to the Existing Agent in
connection with the Existing DIP Credit Agreement, copies of the articles of
incorporation or comparable constitutive documents of each Borrower, together
with all amendments, certified by the appropriate governmental officer in the
relevant jurisdiction of organization as of a recent date prior to the Closing
Date, and certified by the Secretary, Assistant Secretary or other appropriate
officer or director of it as of the Closing Date, and, to the extent applicable
and not already provided to the Existing Agent in connection with the Existing
DIP Credit Agreement, a certificate of good standing for each Borrower, in each
case certified by the appropriate governmental officer in the relevant
jurisdiction of organization as of a recent date prior to the Closing Date;

     (b)       to the extent not already provided to the Existing Agent in
connection with the Existing DIP Credit Agreement, copies of the by-laws (or any
comparable constitutive laws, rules or regulations) of each Borrower as in
effect on the Closing Date certified by the Secretary, Assistant Secretary or
other appropriate officer or director of it;

     (c)       copies, certified as of the Closing Date by the Secretary,
Assistant Secretary or other appropriate officer or director of each of TLGI and
each Borrower, of its board of directors' resolutions (and resolutions of other
bodies, if any are deemed necessary by counsel for any Lender) authorizing the
execution and performance of the relevant Loan Documents;

     (d)       to the extent not previously provided to the Existing Agent in
connection with the Existing DIP Credit Agreement, incumbency certificates,
dated as of the Closing Date, executed by the Secretary or Assistant Secretary
or other appropriate officer or director of each Borrower, which shall identify
by name and title and bear the signature of the officers of each Borrower
authorized to sign the relevant Loan Documents and to make borrowings and apply
for Letters of Credit hereunder, as applicable, upon which certificates the
Agent, the Lenders and the L/C Issuer shall be entitled to rely until informed
of any change in writing by TLGI or the Borrowers, as

                                       35
<PAGE>

applicable;

     (e)       a copy of the Borrowing Order, which shall have been entered by
the U.S. Court;

     (f)       payment and satisfaction in full of all outstanding obligations
under the Existing DIP Credit Agreement and termination of the Existing DIP
Credit Agreement;

     (g)       a certificate, signed by the Chief Financial Officer, stating
that on the date hereof and the Closing Date no Default or Unmatured Default has
occurred and is continuing;

     (h)       an opinion of Jones, Day, Reavis & Pogue, United States counsel
to the Borrowers, and an opinion of British Columbia counsel to TLGI
satisfactory to the Agent, regarding the matters set forth on EXHIBIT B and such
other matters as the Agent shall reasonably request;

     (i)       this Agreement, the Notes and the Collateral Documents, duly
executed by the applicable Credit Parties; and

     (j)       since December 31, 1999, no Material Adverse Effect (in the sole
and reasonable opinion of the Agent) shall have occurred, other than the
continuance of the Chapter 11 Cases and the Canadian Cases.

     (k)       such other documents or information as the Agent or its counsel
may reasonably request.

     Notwithstanding anything herein to the contrary, it is understood and
agreed that the documents and information described in Section 7.34 shall be
delivered after the Closing Date in accordance with Section 7.34. Each
Lender, by delivering its signature page to this Agreement and funding its
initial Loans, if any, on the Closing Date, shall be deemed to have
acknowledged receipt of, and consented to and approved (as long as
substantially in the form delivered to the Lenders, including any changed
pages thereto delivered to the Lenders), each Loan Document and each other
document required to be approved or consented to by the Required Lenders or
the Lenders, as applicable, under this SECTION 4.1.

     4.2       EACH ADVANCE AND LETTER OF CREDIT. The Lenders shall not be
required to make any Advance or purchase participations in any Letter of Credit,
and L/C Issuer shall not be required to issue any Letter of Credit hereunder,
unless on the applicable Revolving Loan Borrowing Date or date for issuance of
such Letter of Credit (as applicable):

     (a)       there exists no Default or Unmatured Default;

     (b)       the representations and warranties contained in ARTICLE VI
hereof and in the Collateral Documents are true and correct as of such Revolving
Loan Borrowing Date or date for issuance of such Letter of Credit (as
applicable) except to the extent any such representation or warranty is stated
to relate solely to an earlier date, in which case such representation or
warranty shall be true and correct on and as of such earlier date;

     (c)       after giving effect to such Advance or the issuance of such
Letter of Credit, the aggregate principal amount of Revolving Loans
outstanding after giving effect to such Advance or issuance shall not exceed
by more than $20,000,000 the aggregate principal amount of Revolving Loans
outstanding as of any date after the Closing Date which is less than 30 days
prior to the date of such Advance or issuance;

     (d)       no order, judgment or decree of any court (including, without
limitation, the U.S. Court or the Canadian Court), arbitrator or governmental
authority

                                       36
<PAGE>

shall purport to enjoin or restrain such Lender from making the
Advance to be made by it on that date;

     (e)       the making of the Advance requested on such date shall not
violate any law including, without limitation, Regulation T, Regulation U or
Regulation X of the Board of Governors of the Federal Reserve System; and

     (f)       there shall not be pending or, to the Borrowers' knowledge,
threatened, any action, suit, proceeding, governmental investigation or
arbitration against or affecting the Borrowers or any property of the Borrowers
that has not been disclosed by the Borrowers in writing pursuant to SECTION 6.7
or SECTION 7.1(h) prior to the making of the last preceding Advances (or, in the
case of the initial Advances, prior to the execution of this Agreement), and
there shall have occurred no development not so disclosed in any such action,
suit, proceeding, governmental investigation or arbitration so disclosed, that,
in either event, in the opinion of the Agent or of the Required Lenders, would
reasonably be expected to have a Material Adverse Effect; and no injunction or
other restraining order shall have been issued and no hearing to cause an
injunction or other restraining order to be issued shall be pending or noticed
with respect to any action, suit or proceeding seeking to enjoin or otherwise
prevent the consummation of, or to recover any damages or obtain relief as a
result of, the transactions contemplated by this Agreement or the making of
Advances hereunder.

               Each Revolving Loan Borrowing Notice with respect to an Advance
and application with respect to a Letter of Credit shall constitute a
representation and warranty by the Borrower that the conditions contained in
SECTIONS 4.2(a), (b), (c), (d) and (e) have been satisfied.

                        ARTICLE V [INTENTIONALLY OMITTED]

                                   ARTICLE VI
                         REPRESENTATIONS AND WARRANTIES

     Each of TLGI and, with respect to itself and its Subsidiaries, each
Borrower represents and warrants to the Lenders and the L/C Issuer that:

     6.1       EXISTENCE AND STANDING. Each of TLGI, each Borrower and the other
Subsidiaries is a corporation, limited partnership or limited liability company
duly incorporated or formed, as the case may be, validly existing and in good
standing under the laws of its jurisdiction of incorporation or formation, as
the case may be, and, subject to compliance with any applicable provisions of
the Bankruptcy Code, has all requisite authority to conduct its business in each
jurisdiction wherein such qualification is required, except to the extent that,
in the case of any Subsidiary other than any Borrower, the failure to be in good
standing or authorized to conduct business in any jurisdiction could not, when
taken together with all similar failures by such Subsidiary and each other
Subsidiary, reasonably be expected to have a Material Adverse Effect. Each of
TLGI and each Borrower is in compliance with its constitutive documents and all
applicable orders of the U.S. Court and the Canadian Court.

     6.2       AUTHORIZATION AND VALIDITY. Each Credit Party has the corporate,
limited partnership or limited liability company power and authority and legal
right to execute and deliver the Loan Documents to which it is party and to
perform its obligations thereunder. The execution and delivery by each Credit
Party of the Loan Documents to which it is party and the performance of its
obligations thereunder have been duly authorized by proper corporate, limited
partnership or limited liability company proceedings and have been or by the
Closing Date will be duly authorized by the U.S. Court and the Canadian Court,
and each Loan Document to which each Credit Party constitutes the legal, valid
and binding obligation of such Credit Party, enforceable against

                                       37
<PAGE>

such Credit Party, in accordance with its terms, except as enforceability may be
limited by bankruptcy, insolvency or similar laws affecting the enforcement of
creditors' rights generally and general principles of equity, regardless of
whether the application of such principles is considered in a proceeding in
equity or at law.

     6.3       NO CONFLICT, GOVERNMENT CONSENT. Neither the execution and
delivery by each Credit Party of the Loan Documents to which it is party, nor
the consummation of the transactions therein contemplated, nor compliance with
the provisions thereof, will violate any law, rule, regulation, order, writ,
judgment, injunction, decree or award binding on TLGI, any Borrower or any
Subsidiary or TLGI's, any Borrower's or any Subsidiary's articles of
incorporation or by-laws or comparable constitutive documents, any applicable
order of the U.S. Court or the Canadian Court or the provisions of any
indenture, instrument or agreement to which TLGI, any Borrower or any Subsidiary
is a party or is subject, or by which it, or its Property, is bound, or conflict
with or constitute a default thereunder, or result in the creation or imposition
of any Lien in, of or on the Property of TLGI, any Borrower or any Subsidiary
pursuant to the terms of any such indenture, instrument or agreement. No order,
consent, approval, license, authorization or validation of, or filing, recording
or registration with, or exemption by, any governmental or public body or
authority, or any subdivision thereof is required to authorize, or is required
in connection with the execution, delivery and performance of, or the legality,
validity, binding effect or enforceability of, any of the Loan Documents, except
for consents, approvals, authorizations and filings or applicable orders of the
U.S. Court and the Canadian Court which have already been duly obtained and made
and which remain valid and in full force and effect.

     6.4       FINANCIAL STATEMENTS. Each of (a) the December 31, 1999,
consolidated financial statements of TLGI and its Subsidiaries and (b) the
December 31, 1999, consolidated financial statements of the Borrowers and their
Subsidiaries, heretofore delivered to the Lenders, were prepared in accordance
with GAAP in effect on the date such statements were prepared and fairly present
the consolidated financial condition and operations of TLGI and its Subsidiaries
and of the Borrowers and its Subsidiaries, respectively, at the date thereof and
the consolidated results of their respective operations for the period then
ended.

     6.5       MATERIAL ADVERSE CHANGE. Since December 31, 1999, there has been
no change in the business, Property, prospects, financial condition or results
of operations of TLGI and its Subsidiaries (taken as a whole) or of the
Borrowers and their Subsidiaries (taken as a whole) which could reasonably be
expected to have a Material Adverse Effect, other than the commencement of the
Chapter 11 Cases and the Canadian Cases.

     6.6       TAXES. All income tax returns required to be filed by TLGI, any
Borrower or any Subsidiary in any jurisdiction have, in fact, been filed, all
such tax returns have been prepared in accordance with applicable laws and all
taxes, assessments, fees and other governmental charges upon TLGI, any Borrower
or any Subsidiary or upon any of their respective properties, income or
franchises which are shown on such returns have been paid. For all taxable years
ending on or before December 31, 1999, either (i) the United States Federal
income tax liability of TLGI, each Borrower and the other Subsidiaries has been
satisfied and the period of limitations on assessment of additional United
States Federal income tax has expired or TLGI, such Borrower or the applicable
other Subsidiary has entered into an agreement with the United States Internal
Revenue Service closing conclusively the total tax liability for the taxable
year or (ii) none of TLGI, the Borrowers and the other Subsidiaries knows of any
proposed additional tax

                                       38
<PAGE>

assessment against it or any of them for which adequate provision has not been
made on its or their accounts, and no material controversy in respect of
additional income or other taxes due or claimed to be due to any Governmental
Authority is pending or to the knowledge of TLGI, any Borrower or the other
Subsidiaries threatened, other than audits by governmental taxing authorities
occurring in the ordinary course of business. The charges, accruals and reserves
on the books of TLGI, each Borrower and the other Subsidiaries in respect of any
taxes or other governmental charges are adequate.

     6.7       LITIGATION AND CONTINGENT LIABILITIES. Except as set forth on
SCHEDULE 6.7 hereto (but only to the extent described thereon), there is no
litigation, arbitration, governmental investigation, proceeding or inquiry
pending or, to the knowledge of any of their officers, threatened against or
affecting TLGI, any Borrower or any other Subsidiary which could have a Material
Adverse Effect, or for which there is a reasonable likelihood that TLGI, any
Borrower or any other Subsidiary would make a payment, whether in settlement or
otherwise, in excess of $1,000,000. Other than any liability incident to such
litigation, arbitration or proceedings, none of TLGI, the Borrowers or any other
Subsidiary has any material contingent liabilities not provided for or disclosed
in the financial statements referred to in SECTION 6.4.

     6.8       SUBSIDIARIES; PLEDGE OF STOCK. SCHEDULE 6.8 hereto, together
with the most recent update, if any, delivered pursuant to SECTION 7.1(k),
contains an accurate list of all of the Subsidiaries (except for inactive
Subsidiaries with immaterial assets and liabilities) of each of TLGI and each
Borrower, setting forth their respective jurisdictions of incorporation and the
percentage of their respective capital stock owned by TLGI, the Borrowers or
other Subsidiaries. All of the issued and outstanding shares of capital stock of
the Subsidiaries of TLGI and each Borrower listed on SCHEDULE 6.8 hereto,
together with the most recent update, if any, delivered pursuant to SECTION
7.1(k) have been duly authorized and issued and are fully paid and
non-assessable and have been duly and validly pledged under the Collateral
Documents and delivered to Bankers Trust Company, as collateral agent under, and
pursuant to the terms of, the Collateral Trust Agreement. All Subsidiaries of
each Borrower (other than the Insurance Companies and (to the extent permitted
not to so execute such documents) those Subsidiaries specifically identified as
not being Borrowers on SCHEDULE 6.8) have executed and delivered this Agreement
and each other Loan Document to which any Borrower is a party as a "Borrower"
hereunder and thereunder, and each U.S. Subsidiary of TLGI which is party to the
Collateral Trust Agreement is a Borrower hereunder.

     6.9       ERISA. The Unfunded Liabilities of all Single Employer Plans do
not in the aggregate exceed $1,000,000. Neither TLGI, the Borrowers nor any
other member of the Controlled Group has incurred, or is reasonably expected to
incur, any withdrawal liability to Multiemployer Plans in excess of $1,000,000
in the aggregate. Each Plan complies in all material respects with all
applicable requirements of law and regulations, no Reportable Event has occurred
with respect to any Plan, none of TLGI, the Borrowers nor any other member of
the Controlled Group has withdrawn from any Plan or initiated steps to do so,
and no steps have been taken to reorganize or terminate any Plan. No
contribution failure has occurred with respect to any Single Employer Plan
sufficient to give rise to a lien under section 302(f) of ERISA. Each Canadian
Plan is registered under, and is in compliance with, the Income Tax Act
(Canada), applicable provincial pensions legislation and all other applicable
requirements of law and regulations and all reports, returns and filings
required to be made thereunder have been made. The Canadian Plans have been at
all times administered in accordance with their terms and the provisions of all
applicable requirements of law and regulations. There are no unfunded
liabilities under the Canadian Plans and, without limiting the generality of the
foregoing,

                                       39
<PAGE>

there is no going concern unfunded actuarial liability, past service unfunded
actuarial liability or solvency deficiency. Neither TLGI nor any Subsidiary has
received any payment of surplus from any of the Canadian Plans, other than
payments received after January 1, 1988 with the approval of all necessary
pension regulatory and taxation authorities.

     6.10      ACCURACY OF INFORMATION. No written information, exhibit or
report prepared and furnished by TLGI, any Borrower or any other Subsidiary to
the Agent, any Lender or the L/C Issuer in connection with the negotiation of,
or compliance with, the Loan Documents contained any material misstatement of
fact or omitted to state a material fact or any fact necessary to make the
statements contained therein not misleading.

     6.11      REGULATION U. Margin stock (as defined in Regulation U)
constitutes less than 25% of those assets of TLGI, the Borrowers and other
Subsidiaries which are subject to any limitation on sale, pledge or other
restriction hereunder or under any other Loan Document. None of the execution,
delivery and performance of this Agreement and the other Loan Documents by the
Borrowers will violate Regulation T, U or X of the Board of Governors of the
Federal Reserve System.

     6.12      MATERIAL AGREEMENTS. None of TLGI, the Borrowers or any
Subsidiary is in default in the performance, observance or fulfillment of any of
the obligations, covenants or conditions contained in any agreement to which
it is a party, which default could reasonably be expected to have a Material
Adverse Effect.

     6.13      COMPLIANCE WITH LAWS. TLGI, each Borrower and the other
Subsidiaries have complied in all material respects with all applicable
statutes, rules, regulations, orders and restrictions of any Governmental
Authority having jurisdiction over the conduct of their respective businesses or
the ownership of their respective Property the failure with which to comply
could have a Material Adverse Effect. None of TLGI, the Borrowers or any
Subsidiary has received any notice to the effect that, or is otherwise aware
that, its operations are not in material compliance with any of the requirements
of applicable Environmental Laws or the subject of any investigation by any
Governmental Authority evaluating whether any remedial action is needed to
respond to a Release, which noncompliance or remedial action could reasonably be
expected to have a Material Adverse Effect, and no event or condition has
occurred or is occurring with respect to TLGI, the Borrowers or any Subsidiaries
relating to any Environmental Law, any Release or any Hazardous Materials
Activity which, individually or in the aggregate, has had or could reasonably be
expected to have a Material Adverse Effect.

     6.14      OWNERSHIP OF PROPERTIES. Except as set forth on SCHEDULE 6.14
hereto, on the date of this Agreement, each of TLGI, each Borrower and each
other Subsidiary has good title, free of all Liens other than those permitted by
SECTION 7.20, to all of the Property and assets reflected as owned by it in the
financial statements delivered from time to time pursuant hereto. As of the
Closing Date, SCHEDULE 6.14 annexed hereto contains a true, accurate and
complete list of (i) all fee properties of the Borrowers and their Subsidiaries
and (ii) all leasehold interests of any Borrower or Subsidiary of any Borrower
as lessee under any lease of real property, and indicates which of the
properties set forth on such Schedule are subject to existing perfected Liens
under a written security instrument (whether designated as a deed of trust or a
mortgage or by any similar title). The aggregate principal amount of
Indebtedness secured by Liens under written security agreements or instruments
(x) encumbering real property assets listed in SCHEDULE 6.14 and (y) any other
Property of the Borrowers (other than the collateral securing the Existing
Credit Agreements, if any) does not exceed $100,000,000.

     6.15      INVESTMENT COMPANY ACT. None of TLGI, the Borrowers or any

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<PAGE>

other Subsidiary is an "investment company" or a company "controlled" by an
"investment company" within the meaning of the Investment Company Act of 1940,
as amended.

     6.16      PUBLIC UTILITY HOLDING COMPANY ACT. None of TLGI, the Borrowers
or any other Subsidiary is a "holding company" or a "subsidiary company" of a
"holding company," or an "affiliate" of a "holding company" or of a "subsidiary
company" of a "holding company," within the meaning of the Public Utility
Holding Company Act of 1935, as amended, or is subject to regulation under any
other U.S. or Canadian federal, provincial or state statute or regulation (other
than the Bankruptcy Code and the CCAA) which in any case limits its ability to
incur Indebtedness or which may otherwise render all or any portion of the
Obligations unenforceable.

     6.17      POST-RETIREMENT BENEFITS. The present value of the expected cost
of post-retirement medical and insurance benefits payable by TLGI, the
Borrowers and the other Subsidiaries to their employees and former employees, as
estimated by TLGI in accordance with procedures and assumptions specified by the
Required Lenders, or in the absence of such specification, deemed prudent and
reasonable by TLGI, does not exceed $1,000,000.

     6.18      NEGATIVE PLEDGE. None of TLGI, the Borrowers nor any Subsidiary
of TLGI or any Borrower is party to any postpetition contract or other
arrangement under the terms of which TLGI, such Borrower or any such Subsidiary
is restricted from (i) performing its respective obligations under the
Collateral Documents or any other Loan Document to which it is a party or (ii)
providing a guaranty to the Agent, the Lenders or the L/C Issuer.

     6.19      RESTRICTIONS ON TRANSFER. There are no restrictions on any
Borrower which prohibit or otherwise restrict the transfer of cash or other
assets from one to another, other than prohibitions or restrictions existing
under or by reason of (i) this Agreement and the other Loan Documents, (ii)
applicable law (including the Bankruptcy Code and any applicable order of the
U.S. Court), (iii) customary non-assignment provisions entered into in the
ordinary course of business and consistent with past practices, and (iv) any
documents or instruments governing the terms of any Indebtedness or other
obligations secured by Liens permitted by SECTION 7.20 (each of which documents
or instruments is set forth on, and each of which documents and instruments is
described on, SCHEDULE 6.19 annexed hereto); provided that (x) such prohibitions
or restrictions set forth in CLAUSES (iii) or (iv) only apply to the extent
enforceable under the Bankruptcy Code and the applicable orders of the U.S.
Court.

     6.20      CHAPTER 11 CASES AND CANADIAN CASES. The Chapter 11 Cases were
commenced on the Petition Date in accordance with Applicable Law and all notice
thereof as required by Applicable Law has been given. The Canadian Cases were
commenced on the Petition Date in accordance with Applicable Law.

     6.21      CASH MANAGEMENT SYSTEM. The summary of the Borrowers' cash
management system attached hereto as SCHEDULE 6.21 is accurate and complete in
all material respects as of the Closing Date and does not omit to state any
material fact necessary to make the statements set forth therein not misleading.
No Borrower nor any of its Subsidiaries owns any Deposit Account which is not
described in SCHEDULE 6.21 or otherwise permitted pursuant to SECTION 7.10.
There has been no change to the cash management system (other than as permitted
by SECTION 7.10) since the Closing Date except such changes as have been
disclosed to the Agent in writing and approved by the Agent.

     6.22      ARTICLES OF INCORPORATION, ETC. There have been no material
amendments to the articles of incorporation, by-laws, certificates of good
standing or

                                       41
<PAGE>

incumbency certificates of TLGI or any Borrower delivered to the Existing Agent
under the Existing DIP Credit Agreement.

                                   ARTICLE VII
                                    COVENANTS

     During the term of this Agreement, unless the Required Lenders shall
otherwise consent in writing, TLGI and each Borrower shall perform, and cause to
be performed, the following:

     7.1       REPORTING REQUIREMENTS. TLGI and the Borrowers will maintain,
and cause each other Subsidiary to maintain, a system of accounting established
and administered in accordance with GAAP (subject, in the case of TLGI, to the
review and reporting of the Monitor in accordance with the CCAA Orders), and
will furnish or cause to be furnished to the Lenders:

     (a)       not later than Friday of each week after the Closing Date, a
flash report in form and substance reasonably satisfactory to the Agent;

     (b)       as soon as possible and in any event within 30 days after the
end of each calendar month, (i) a report in form and substance reasonably
satisfactory to the Agent that contains the following information and
calculations: monthly income statement, operating statements and other
internally generated analyses prepared on a monthly basis, including management
discussion and analysis of significant variances, (ii) an update on all covenant
calculations as of the most recent date applicable to such calculations under
this Agreement, together with a report on all payment and expenditure
limitations in this Agreement (whether or not such limitations are measured for
a time period ending on or about the applicable time period), and (iii) a
certificate of an Authorized Officer (together with supporting statements and
calculations) certifying and evidencing that the Borrowers have complied with
Section 2.10(b), together with a detailed report with respect to all pending
Asset Sales and a list of all Asset Sales consummated during the preceding
month;

     (c)       (i) as soon as available and in any event within 105 days after
the close of each of TLGI's fiscal years, (x) together with an unqualified
(except qualifications relating to changes in accounting principles or practices
reflecting changes in GAAP and required or approved by TLGI's independent
chartered accountants or independent public accountants and qualifications as
may relate to the financial circumstances of TLGI and its Subsidiaries related
to the Chapter 11 Cases and the Canadian Cases) audit report certified by
independent chartered accountants or independent public accountants, acceptable
to the Lenders, consolidated financial statements of TLGI prepared in accordance
with Agreement Accounting Principles on a consolidated basis for itself and its
Subsidiaries, including balance sheets as of the end of such period, related
statements of profit and loss, retained earnings and changes in financial
position, accompanied by a review engagement report of said accountants in
accordance with the standards of Section 8600 of the CICA Handbook stating that,
in connection with the foregoing, they have obtained no knowledge of any failure
of TLGI or its Subsidiaries to comply with the requirements specified in each of
SECTIONS 7.12 through 7.23, or if, in the opinion of such accountants, TLGI or
any of its Subsidiaries has failed to comply with the requirements specified in
any such Section, stating the nature and status of such failure, and (y)
consolidating financial statements of TLGI certified by the Chief Financial
Officer that separately present TLGI's Canadian operations, United States
operations and other material financial operations prepared in accordance with
Agreement Accounting Principles, including balance sheets as of the end of such
period, and related statements of profit and loss,

                                       42
<PAGE>

retained earnings and changes in financial position; and (ii) within 180 days
after the close of each of TLGI's fiscal years, the management letter prepared
by the applicable accountants in connection with the financial statements for
such fiscal year delivered pursuant to the foregoing CLAUSE (i)(x);

     (d)       as soon as available and in any event within 50 days after the
close of each of the first three quarterly periods of each of TLGI's fiscal
years, for TLGI and its Subsidiaries, consolidated unaudited balance sheets as
at the close of such period and consolidated statements of profit and loss,
retained earnings and changes in financial position for the period from the
beginning of such fiscal year to the end of such period, all certified by the
Chief Financial Officer;

     (e)       together with the financial statements required pursuant to the
foregoing CLAUSES (b), (c) and (d), a compliance certificate in substantially
the form of EXHIBIT C hereto signed by the Chief Financial Officer showing in
reasonable detail the calculations necessary to determine compliance with this
Agreement, stating that no Default or Unmatured Default exists or if any Default
or Unmatured Default exists, stating the nature and status thereof, and
otherwise providing the information required thereby;

     (f)       within 270 days after the close of each fiscal year of TLGI, a
statement of the Unfunded Liabilities of each Single Employer Plan, certified as
correct by an actuary enrolled under ERISA;

     (g)       as soon as possible and in any event within ten days after TLGI
or any Borrower knows that any Reportable Event has occurred with respect to any
Plan or that a withdrawal has occurred from any Multiemployer Plan, the
occurrence of either of which may reasonably be expected to give rise to a
Material Adverse Effect, or that a contribution failure has occurred with
respect to any Single Employer Plan sufficient to give rise to a lien under
section 302(f) of ERISA, a statement, signed by the Chief Financial Officer,
describing said Reportable Event or contribution failure and the action which
TLGI and the Borrowers propose to take with respect thereto;

     (h)       as soon as possible and in any event within 30 days after
receipt by TLGI or any of its Subsidiaries, a copy of (i) any notice or claim to
the effect that TLGI or any of its Subsidiaries is or may reasonably be expected
to be liable for $1,000,000 or more of potential liability (when aggregated with
other similar potential liability) to any Person as a result of a Release by
TLGI, any of its Subsidiaries or any other Person and (ii) any notice alleging
any violation of any Environmental Laws by TLGI or any of its Subsidiaries,
which violation could reasonably be expected to give rise to a Material Adverse
Effect;

     (i)       promptly upon the furnishing thereof to the shareholders of TLGI,
copies of all financial statements, reports and proxy statements so furnished,
and promptly upon the furnishing thereof to any official committee of unsecured
creditors or any similar committee which shall be constituted under the
Collateral Trust Agreement or in respect of any other Prepetition Indebtedness,
copies of any reports, financial statements, notices or other information so
furnished;

     (j)       promptly upon their becoming available, one copy of each
financial statement, report, notice or proxy statement sent by TLGI or any
Borrower to stockholders generally (excluding those statements, reports and
notices sent by any Borrower to TLGI which are not sent to TLGI solely in its
capacity as a stockholder) and of each regular report and any registration
statement or prospectus filed by TLGI, any Borrower or any other Subsidiary with
the Ontario Securities Commission, the Toronto Stock Exchange, the British
Columbia Securities Commission, the United States Securities and Exchange
Commission or any successor agency to any of the foregoing or any other

                                       43
<PAGE>

Canadian or United States federal or state or provincial securities exchange or
securities trading system or with any United States or Canadian national stock
exchange and one copy of each periodic report filed by TLGI with any Canadian
regulatory authority, in all cases without duplication; PROVIDED, HOWEVER, that
neither TLGI nor any of the Borrowers shall be obligated to provide to the
Lenders routine reports which are required to be provided to any of the
above-listed entities concerning the management of employee benefit plans,
including, without limitation, stock purchases or the exercise of stock options
made under any such employee benefit plan;

     (k)       together with the financial statements delivered pursuant to
SECTION 7.1(c), a current list of all of the Subsidiaries of each of TLGI and
each Borrower, setting forth their respective jurisdictions of incorporation and
the percentage of their respective capital stock owned by TLGI, each Borrower
and the other Subsidiaries;

     (l)       promptly after the same is available, all pleadings, motions,
applications, judicial information, financial information and other documents
filed by or on behalf of TLGI or by or on behalf of any Canadian Subsidiary or
by the Monitor or by or on behalf of any Borrower with the U.S. Court or the
United States Trustee in the Chapter 11 Cases or with the Canadian Court or
distributed by or on behalf of TLGI or any of its Subsidiaries to any official
committee appointed in the Chapter 11 Cases or any committee of creditors
constituted in Canadian Cases under the CCAA Orders and without limiting the
generality of the foregoing, the Borrowers and TLGI shall promptly deliver to,
and discuss with, Agent and its counsel any and all information and developments
in connection with any proposed Asset Sale, including, without limitation, any
letters of intent, commitment letters or engagement letters received by TLGI or
any of its Subsidiaries and any other event or condition which is reasonably
likely to have a material effect on TLGI or any of its Subsidiaries or the
Chapter 11 Cases or the Canadian Cases, including, without limitation, the
progress of any disclosure statement or any proposed Chapter 11 plan of
reorganization, any proposed CCAA Plan and any proposed BCCA Plan;

     (m)       promptly upon becoming aware thereof, notice of (i) the
effectiveness after the Closing Date of any law, governmental rule, regulation
or order binding on TLGI or any of its Subsidiaries, or any change or
modification therein or in the interpretation, administration or application
thereof, or (ii) the cancellation, termination, rescission, revocation,
suspension, impairment, or denial of renewal or other material modification of
any license, authorization or permit of TLGI or any of its Subsidiaries, or
(iii) the renewal, on terms different from the terms of the license,
authorization or permit so renewed, of any license, authorization or permit of
TLGI or any of its Subsidiaries, which in any case described in clause (i), (ii)
and/or (iii), individually or in the aggregate, could reasonably be expected to
materially adversely affect the economic or commercial value or usefulness of
the Borrower's licenses, permits and authorizations in any State of the United
States or province of Canada or materially impede the transfer of cash generated
through operations of any Borrower from one State of the United States or
province of Canada to another such State or province through the cash management
system described on SCHEDULE 6.21; and

     (n)       promptly, such other information (including non-financial
information) as the Agent or any Lender may from time to time reasonably
request.

     7.2       USE OF PROCEEDS. The Borrowers will use the proceeds of the
Advances (i) on or about the Closing Date, to satisfy in full all outstanding
obligations with respect to the Existing DIP Credit Agreement, and (ii) on and
after the Closing Date, for the Borrowers' general corporate and working capital
purposes (including, without

                                       44
<PAGE>

limitation, the payment of fees and expenses payable under SECTION 10.7) which
shall include the making of payments pursuant to the Overhead Allocation
Agreement to TLGI for the payment of general and administrative expenses and
restructuring costs associated with the Chapter 11 Cases and the Canadian Cases.
It is understood and agreed that TLGI and the Borrowers shall not permit the
proceeds of Advances to be advanced, loaned, contributed or otherwise forwarded
to any Person that is not a Borrower, except as set forth in this SECTION 7.2.
No Borrower will, nor will it permit any of its Subsidiaries to, use any of the
proceeds of the Advances to purchase or carry any "margin stock" (as defined in
Regulation U).

     7.3       NOTICES OF DEFAULT, LITIGATION, ETC. TLGI and the Borrowers will
give notice in writing to the Lenders of the occurrence of (a) any Default or
Unmatured Default, (b) any payment, or any group of payments (whether or not
related), whether in settlement or otherwise, in excess of $500,000, which at
any time are expected to be made at or after such time by TLGI, any Borrower or
any Subsidiary in connection with any litigation, arbitrations, governmental
investigations, proceedings or inquiries, whether individually or in the
aggregate (it being understood that TLGI and the Borrowers, in lieu of
separately identifying each such expected payment, may group such payments to
the extent deemed necessary to protect confidentiality), (c) any development,
financial or otherwise, which could reasonably be expected to have a Material
Adverse Effect, and (d) any change in the practices and procedures of TLGI and
any Borrower in effect on the date of this Agreement regarding acquisitions and
litigation (which practices and procedures have been described prior to the date
of this Agreement by representatives of TLGI and any Borrower to the Agent and
the Lenders) which notice, in each of the foregoing cases, shall be given
promptly and in any event within five Business Days after TLGI, any Borrower or
the relevant Subsidiary becomes aware of the Default, Unmatured Default,
payment, development, determination or change. Together with the financial
statements delivered pursuant to SECTIONS 7.1(b), (c) and (d), TLGI and the
Borrowers shall provide to the Agent (with sufficient copies for each Lender) a
report, prepared as of the last day of each calendar quarter, (x) for all
litigation, arbitrations, governmental investigations and proceedings pending
or, to the knowledge of any Authorized Officer, threatened against or affecting
TLGI, any Borrower or any other Subsidiary for which the claim or matter
involves an amount in excess of $500,000, briefly summarizing the matter
(including whether resolution of the matter could come before a jury),
identifying the relief sought and the amount of the claim, and specifying
whether the claim is covered by insurance and (y) identifying in reasonable
detail each payment in excess of $250,000 made during such calendar quarter, or
expected to be made thereafter, in settlement of, or otherwise in satisfaction
of, any litigation, arbitrations, governmental investigations, proceedings or
inquiries. TLGI and the Borrowers agree to discuss with the Agent and the
Lenders, upon the request of the Agent or any Lender, the status of any
litigation, arbitrations, governmental investigations, proceedings and inquiries
and any settlements thereof.

     7.4       CONDUCT OF BUSINESS. TLGI and each Borrower will, and will cause
each Subsidiary to, carry on and conduct its business in substantially the same
manner and in substantially the same fields of enterprise as it is conducted on
the date of this Agreement and to do all things necessary to remain duly
incorporated, validly existing and in good standing as a domestic corporation in
its jurisdiction of incorporation and maintain all requisite authority to
conduct its business in each jurisdiction in which its business requires it to
be so authorized. Nothing in this SECTION 7.4 shall prohibit any merger,
amalgamation, or consolidation which is permitted by SECTION 7.14. TLGI and each
Borrower shall also pay their respective post-Petition Date accounts payable in

                                       45
<PAGE>

accordance with ordinary trade terms.

     7.5       TAXES. Except as prohibited by the Borrowing Order, this
Agreement, the Bankruptcy Code, the CCAA Orders or any other applicable order of
the U.S. Court or Canadian Court, TLGI and each Borrower will, and will cause
each respective Subsidiary of it to, pay when due all post-Petition Date taxes,
assessments and governmental charges and levies upon it or its income, profits
or Property, except those which are being contested in good faith by appropriate
proceedings and with respect to which adequate reserves have been set aside in
accordance with GAAP.

     7.6       INSURANCE. TLGI and each Borrower will, and will cause each
respective Subsidiary of it to, maintain with financially sound and reputable
insurance companies insurance on all their Property in such amounts and covering
such risks as is customary in the industries in which TLGI, such Borrower and
such Subsidiaries are engaged and which is consistent with sound business
practice; PROVIDED, HOWEVER, that, in any event, TLGI and each Borrower will
maintain, and cause each respective Subsidiary of it to maintain, at all times
insurance which, in the aggregate, is not materially less comprehensive in
scope and policy amount than the insurance maintained by them collectively as of
the date hereof. TLGI and each Borrower will furnish to any Lender upon request
from time to time full information as to the insurance carried.

     7.7       COMPLIANCE WITH LAWS. TLGI and each Borrower will, and will
cause each respective Subsidiary of it to, comply in all material respects with
all laws, rules, regulations, orders, writs, judgments, injunctions, decrees or
awards to which it or its Properties may be subject. Without limiting the
foregoing, TLGI and each Borrower shall promptly take, and shall cause each of
its Subsidiaries promptly to take, any and all actions necessary to (i) cure any
material violation of applicable Environmental Laws by TLGI, the Borrowers or
their Subsidiaries that could reasonably be expected to have, individually or in
the aggregate, a Material Adverse Effect and (ii) make an appropriate response
to any Environmental Claim against TLGI, the Borrowers or any of their
Subsidiaries and discharge any obligations it may have to any Person thereunder
where failure to do so could reasonably be expected to have, individually or in
the aggregate, a Material Adverse Effect.

     7.8       MAINTENANCE OF PROPERTIES. TLGI and each Borrower will, and will
cause each respective Subsidiary of it to, do all things necessary to maintain,
preserve, protect and keep its Property in good repair, working order and
condition, ordinary wear and tear excepted, and make all necessary and proper
repairs, renewals and replacements so that its business carried on in connection
therewith may be properly conducted at all times.

     7.9       INSPECTION. TLGI and each Borrower will, and will cause each
respective Subsidiary of it to, permit the Agent and any or each Lender, by its
respective representatives and agents, to inspect any of the Property, corporate
books and financial records of TLGI, such Borrower and each such Subsidiary, to
examine and make copies of the books of accounts and other financial records of
TLGI, such Borrower and each such Subsidiary, and to discuss the affairs,
finances and accounts of TLGI, such Borrower and each such Subsidiary with, and
to be advised as to the same by, their respective officers at such reasonable
times and intervals as the Agent or such Lender may designate. Without limiting
the foregoing, each of TLGI and each Borrower agrees that upon reasonable notice
and during business hours, (a) it will provide access for informational purposes
to senior management of TLGI and the Borrowers to the Agent and the Lenders, and
(b) it will provide access to the Agent and its agents and representatives for
the purposes of reviewing and assessing the nature and value of the Collateral.

     7.10      CASH MANAGEMENT SYSTEM. (a) The Borrowers have established

                                       46
<PAGE>

concentration accounts (together, the "BORROWER CONCENTRATION ACCOUNT") at Bank
One, N.A. and First Union which receive all transfers and payments from the cash
management system described in Schedule 6.21. The Borrowers shall maintain the
Borrower Concentration Account and cash management system as described in
SCHEDULE 6.21; PROVIDED that each Borrower may open and close Deposit Accounts
and make other changes to such cash management system in the ordinary course of
business upon prior written notice to the Agent and as long as (i) no Default or
Unmatured Default has occurred and is continuing or would result therefrom and
(ii) such changes, either individually or in the aggregate, are not adverse to
either the Agent or any Lender (in its capacity as a Lender) or impair any
rights of the Agent under the Collateral Documents. Anything herein to the
contrary notwithstanding, such cash management system shall provide (x) that
amounts at any time held in Deposit Accounts (other than the Concentration
Account) of the Borrowers and their Subsidiaries shall only be in respect of
requirements of the applicable depository institutions or requirements of
regulatory practice, and (y) that Cash Balances held in the Borrower
Concentration Account shall be paid automatically to the Agent, on a weekly
basis, in accordance with, and to the extent required by, SECTION 2.10(b)(iii).
In the event that the Borrowers are prohibited in any State by regulatory
requirements from transferring amounts held in Deposit Accounts (other than the
Concentration Account) of the Borrowers and their Subsidiaries to the
Concentration Account, the Borrowers will promptly (a) establish and maintain
additional concentration accounts and disbursement accounts (each being a "STATE
CONCENTRATION ACCOUNT" or a "STATE DISBURSEMENT ACCOUNT", as the case may be) in
such State with the Agent, a Lender or other financial institution acceptable to
the Agent, (b) enter into arrangements to transfer on a weekly or other basis
acceptable to the Agent all amounts held in Deposit Accounts (other than
concentration accounts) in such State to such State Concentration Accounts, and
(c) enter into arrangements satisfactory to the Agent so that disbursements in
such State will be made only from such State Disbursement Accounts.

     (b)       TLGI and each Canadian Subsidiary shall maintain the cash
management system as described in SCHEDULE 6.21; PROVIDED that TLGI and each
Canadian Subsidiary may open and close Deposit Accounts and make other changes
to such cash management system in the ordinary course of business upon prior
written notice to the Agent and as long as (i) no Default or Unmatured Default
has occurred and is continuing or would result therefrom and (ii) such changes,
either individually or in the aggregate, are not adverse to either the Agent or
any Lender (in its capacity as a Lender).

     7.11      FURTHER ASSURANCES.

     (a)       ASSURANCES. Without expense or cost to Agent or Lenders, TLGI
and each Borrower shall, and shall cause each Subsidiary of it to, from time to
time hereafter execute, acknowledge, file, record, do and deliver all and any
further acts, deeds, conveyances, mortgages, deeds of trust, deeds to secure
debt, security agreements, hypothecations, pledges, charges, assignments,
financing statements and continuations thereof, notices of assignment,
transfers, certificates, assurances and other instruments, including, without
limitation, Mortgages, as Agent may from time to time reasonably request in
order to carry out more effectively the purposes of this Agreement, the other
Loan Documents or the Borrowing Order, including to subject any Collateral,
intended to now or hereafter be covered, to the Liens created by the Collateral
Documents, to perfect and maintain such Liens, and to assure, convey, assign,
transfer and confirm unto the Agent the property and rights thereby conveyed and
assigned or intended to now or hereafter be conveyed or assigned or that any
Credit Party may be or may hereafter become bound to convey or to assign to
Agent or for carrying out the intention of or facilitating the performance of
the terms of this Agreement, any other Loan Documents, or

                                       47
<PAGE>

the Borrowing Order, registering or recording this Agreement or any other Loan
Document. Without limiting the generality of the foregoing, (i) each Credit
Party shall take or cause to be taken all such actions that may be necessary or,
in the reasonable opinion of the Agent, desirable in order to create in favor of
the Agent, for the benefit of Lenders, (x) a valid and (upon such filing and
recording) perfected first priority security interest in the entire real,
personal and mixed property Collateral which is otherwise unencumbered as of the
Closing Date, and (y) a valid and (upon such filing and recording) perfected
subordinated security interest in the entire real, personal and mixed property
Collateral which is subject to valid, perfected and nonvoidable liens on the
Petition Date, including a subordinate pledge of all of the capital stock of
each of Company's Subsidiaries, and (ii) the Borrowers shall deliver to the
Agent, promptly upon receipt thereof, all instruments received by the Credit
Parties after the Closing Date and take all actions and execute all documents
necessary or reasonably requested by the Agent to perfect the Agent's Liens in
any such instrument or any other Investment acquired by any Credit Party.
Notwithstanding the foregoing, to the extent that Applicable Law prohibited the
pledge or the delivery of any stock or instrument to the collateral agent under
the Collateral Trust Agreement, the Borrowers shall not be obligated to pledge
or deliver, as applicable, such stock or instrument to the Agent hereunder so
long as the Borrowers can provide, within a reasonable time after the Closing
Date, evidence reasonably satisfactory to the Agent that such prohibitions
continue to be in full force and effect.

     (b)       FILING AND RECORDING OBLIGATIONS. Each Borrower shall jointly and
severally pay all filing, registration and recording fees and all expenses
incident to the execution and acknowledgment of any Mortgage or other Loan
Document, including any instrument of further assurance described in SECTION
7.11(a), and shall pay all mortgage recording taxes, transfer taxes, general
intangibles taxes and governmental stamp and other taxes, duties, imposts,
assessments and charges arising out of or in connection with the execution,
delivery, filing, recording or registration of any Mortgage or other Loan
Document, including any instrument of further assurance described in SECTION
7.11(a), or by reason of its interest in, or measured by amounts payable under,
the Notes, the Mortgages or any other Loan Document, including any instrument of
further assurance described in SECTION 7.11(a), (excluding income, franchise and
doing business taxes), and shall pay all stamp taxes and other taxes required to
be paid on the Notes or any other Loan Document; PROVIDED, however, that such
Borrower may contest in good faith and through appropriate proceedings, any such
taxes, duties, imposts, assessments and charges; PROVIDED further, however, that
such Borrower shall pay all such taxes, duties, imposts and charges when due to
the appropriate taxing authority during the pendency of any such proceedings if
required to do so to stay enforcement thereof. If any Borrower fails to make any
of the payments described in the preceding sentence within 10 days after notice
thereof from the Agent (or such shorter period as is necessary to protect the
loss of or diminution in value of any Collateral by reason of tax foreclosure or
otherwise, as determined by the Agent) accompanied by documentation verifying
the nature and amount of such payments, the Agent may (but shall not be
obligated to) pay the amount due and the Borrowers shall jointly and severally
reimburse all amounts in accordance with the terms hereof. Anything herein to
the contrary notwithstanding, if the Agent, in its reasonable discretion, shall
determine to file any such financing statements, notices of lien, mortgages or
similar instruments, or to otherwise confirm perfection of such liens, the
Borrowers shall cooperate with and assist in such process.

     (c)       COSTS OF DEFENDING AND UPHOLDING THE LIEN. The Agent may, upon
at least five days' prior notice to the Borrowers, (i) appear in and defend any
action or proceeding, in the name and on behalf of the Agent, Lenders or any
Borrower, in which

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<PAGE>

the Agent or any Lender is named or which the Agent in its sole discretion
determines is reasonably likely to materially adversely affect any Property
subject to a Mortgage, any other Collateral, any Mortgage, the Lien thereof or
any other Loan Document and (ii) institute any action or proceeding which Agent
reasonably determines should be instituted to protect the interest or rights of
the Agent and Lenders in any such Property or other Collateral or under this
Agreement or any other Loan Document. The Borrowers, jointly and severally,
agree that all reasonable costs and expenses expended or otherwise incurred
pursuant to this Section (including reasonable attorneys' fees and
disbursements) by the Agent shall be paid pursuant to SECTION 10.7 hereof.

     (d)       CASH MANAGEMENT SYSTEM. The Borrowers shall take all such action
as may reasonably be requested by the Agent to maintain and preserve the cash
management account arrangements in form and substance acceptable to the Agent.

     7.12      DISTRIBUTIONS AND PAYMENTS TO TLGI AND CANADIAN SUBSIDIARIES. No
Borrower will, nor will any Borrower permit any Subsidiary to, declare or make
or incur any liability to make any Distribution, or any payment to TLGI or any
Canadian Subsidiary, except that (a) the Borrowers and their Subsidiaries may
make Distributions to other Borrowers, and (b) the Company may make payments and
Distributions to TLGI to pay (or reimburse TLGI for the payment of) general and
administrative expenses and restructuring costs associated with the Chapter 11
Cases and the Canadian Cases in accordance with the Overhead Allocation
Agreement. TLGI will not, nor will TLGI permit any Canadian Subsidiary to,
declare or make or incur any liability to make any Distribution, except that
TLGI and such Canadian Subsidiaries may make Distributions to any Borrower and
other Canadian Subsidiaries and TLGI.

     7.13      INDEBTEDNESS. Neither TLGI nor any Borrower will, nor will they
permit any Subsidiary to, issue any equity, or to create, incur or suffer to
exist any Indebtedness, except:

     (a)       the Borrowers may become and remain liable with respect to the
Obligations under the Loan Documents;

     (b)       each Borrower may become and remain liable with respect to
Capitalized Lease Obligations in respect of equipment used in the ordinary
course of the funeral home and cemetery business of the Borrowers and their
Subsidiaries;

     (c)       each Borrower may remain liable with respect to Prepetition
Indebtedness without giving effect to any extensions, renewals, refinancings,
supplemental borrowings or other incurrences thereof: and

     (d)       The Borrowers may become and remain liable with respect to
Indebtedness incurred in connection with the rejection of leases and executory
contracts in the Chapter 11 Cases; PROVIDED, that the obligation of any Borrower
in respect of such Indebtedness shall be determined by a Final Order of the U.S.
Court entered at the time of such rejection to be a general, unsecured,
non-priority claim.

     7.14      MERGER. Neither TLGI nor any Borrower will, nor will they permit
any Subsidiary to, merge, amalgamate or consolidate with or into any other
Person, except that (i) a Subsidiary (other than any Borrower) may merge with
any Borrower or (ii) a Subsidiary of TLGI may merge with any other Subsidiary of
TLGI or (iii) a Wholly-Owned Subsidiary (including any Borrower) may merge,
amalgamate or consolidate with any other Borrower and a Subsidiary of any
Borrower, subject to the further condition that if such Borrower is a party to
any such permitted merger, such Borrower shall be the surviving corporation.

     7.15      SALE OF ASSETS. Neither TLGI nor any Borrower will, nor will they
permit any Subsidiary to, lease, sell or otherwise dispose of its Property to
any other

                                       49
<PAGE>

Person, except for

     (a)       sales of inventory and individual cemetery plots in the ordinary
course of business;

     (b)       other sales by the Borrowers and their Subsidiaries of assets not
constituting Asset Sales;

     (c)       Asset Sales of assets of the Borrowers and their Subsidiaries not
exceeding $35,000,000 in the aggregate;

     (d)       Asset Sales of assets of the Borrowers and their Subsidiaries in
excess of $35,000,000 made (i) (x) in connection with the implementation of the
Disposition Program described in the Motion for an Order (A) Approving Global
Bid Procedures and (B) Authorizing Debtors to Grant Pre-Approved Bid Protections
to Prospective Purchasers dated December 30, 1999 and approved pursuant to an
Order entered by the U.S. Court on January 21, 2000 and (y) with the approval of
the U.S. Court, or (ii) with the express prior written consent of the Required
Lenders; and

     (e)       the sale of Security Industrial pursuant to agreements and on
terms and conditions acceptable to the Agent.

All Net Asset Sale Proceeds of any Asset Sales permitted under this Section
shall be applied to make payments to the extent required under SECTION 2.10.

     7.16       PREPAYMENTS. Neither TLGI nor any Borrower will, nor will they
permit any Subsidiary to, either directly or indirectly, voluntarily redeem,
retire or otherwise pay prior to its scheduled maturity, or accelerate the
maturity of, Indebtedness of TLGI, any Borrower or any such Subsidiary; PROVIDED
that in connection with any such prepayment, all commitments to lend or make
other extensions of credit thereunder, and all further obligations of the
Borrowers and their Subsidiaries shall terminate all Liens securing Indebtedness
or other obligations of TLGI, the Borrowers and their Subsidiaries under such
facility shall be released.

     7.17       AFFILIATES. Neither TLGI nor any Borrower will, nor will they
permit any Subsidiary to, enter into any transaction (including, without
limitation, the purchase or sale of any Property or service) with, or make any
payment or transfer to, any Affiliate except in the ordinary course of business
and pursuant to the reasonable requirements of TLGI's, such Borrower's or such
Subsidiary's business and upon fair and reasonable terms no less favorable to
TLGI, such Borrower or such Subsidiary than TLGI, such Borrower or such
Subsidiary would obtain in a comparable arm's-length transaction; PROVIDED,
HOWEVER, that the foregoing terms of this SECTION 7.17 shall not apply to (i)
transactions between or among the Borrowers and their Wholly-Owned Subsidiaries
and payments made in accordance with the Overhead Allocation Agreement

     7.18       INVESTMENTS. Neither TLGI nor any Borrower will, nor will they
permit any Subsidiary to, make or suffer to exist any Investments, or
commitments therefor, except:

     (a)       Investments in existence as of the close of business on the
Closing Date;

     (b)       Investments by any Borrower or any Subsidiary in and to any
Subsidiary which is a Borrower, including any Investment in a corporation which,
after giving effect to such Investment, will become a Borrower, to the extent
such Investment is not prohibited under SECTION 7.25;

     (c)       Investments in property or assets to be used in the ordinary
course of business of TLGI and the Borrowers and the other Subsidiaries
conducted as described in SECTION 7.4 of this Agreement;

                                       50
<PAGE>

     (d)       Investments in commercial paper maturing in 90 days or less from
the date of issuance which, at the time of acquisition by TLGI or any Borrower
or any other Subsidiary, is accorded one of the two highest commercial paper
ratings by Standard & Poor's or Moody's or any other United States nationally
recognized credit rating agency of similar standing;

     (e)       Investments in direct obligations of the United States, any
agency or instrumentality of the United States, the federal government of Canada
or any agency or instrumentality of the federal government of Canada, the
payment or guarantee of which constitutes a full faith and credit obligation of
the United States or Canada, as the case may be, in either case maturing in
three months or less from the date of acquisition thereof;

     (f)       Investments in direct obligations of any province of Canada or
any municipality within a province of Canada or any State or municipality within
the United States maturing in one year or less from the date of acquisition
thereof which, in any such case, at the time of acquisition by TLGI or any
Borrower or any other Subsidiary, is accorded one of the two highest long-term
debt ratings by Standard & Poor's or Moody's or any other United States
nationally recognized credit rating agency of similar standing;

     (g)       Investments in certificates of deposit or bankers' acceptances
with a maturity of 90 days or less issued by a bank or trust company organized
under the laws of the United States or any State thereof, Canada or any Province
thereof, Japan or any member of the European Union, having capital, surplus and
undivided profits aggregating at least $100,000,000 and having a short-term
unsecured debt rating of at least "P-I" by Moody's or "A-1" by Standard &
Poor's;

     (h)       Investments in money market and auction rate preferred stock
issued by Persons organized under the laws of the United States of America or
any State thereof or of Canada or any Province thereof rated "A" or better by
Standard & Poor's or "A" or better by Moody's, or an equivalent rating by any
other United States nationally recognized credit rating agency of similar
standing;

     (i)       Investments in mutual funds investing in assets described in
CLAUSE (d), (e), (f) or (g) above which in any such case would be classified as
a current asset in accordance with U.S. GAAP and which are managed by a fund
manager of recognized United States or Canadian national standing and having
share capital of at least $100,000,000 or having at least $250,000,000 under
management;

     (j)       Investments of funds received by TLGI or any Borrower or any
other Subsidiary in the ordinary course of business, which funds are required to
be held in trust for the benefit of others by TLGI, such Borrower or such
Subsidiary, as the case may be, and which funds do not constitute assets or
liabilities of TLGI or any Borrower or any other Subsidiary;

     (k)       Investments of funds by any Subsidiary which is engaged in the
insurance business which are invested and managed by such Subsidiary in the
ordinary course of its regulated insurance business and insurance operations;

     (l) Investments consisting of acquisitions (whether by purchase of assets
or stock or by merger or consolidation) permitted under SECTION 7.25; PROVIDED
that (a) at the time of consummation of such acquisition, no Default or
Unmatured Default shall have occurred and be continuing, (b) after giving effect
to any such acquisition and the financing thereof, TLGI and the Borrowers
shall be in pro forma compliance with all covenants contained herein, and (c)
any Person acquired in such acquisition shall become, upon consummation of such
acquisition, a Borrower;

     (m)       Investments in connection with Asset Sales permitted under this
Agreement in an aggregate amount not to exceed $10,000,000.

                                       51
<PAGE>

     7.19       NEGATIVE PLEDGE. Neither TLGI nor any Borrower will, nor will
they permit any Subsidiary to, enter into any agreement or other arrangement
under the terms of which TLGI, any Borrower or any Subsidiary would be
restricted from (i) performing its obligations under the Collateral Documents or
any other Loan Document to which it is a party or (ii) providing a guaranty to
the Agent, the Lenders or the L/C Issuer.

     7.20      LIENS. Neither TLGI nor any Borrower will, nor will they permit
any Subsidiary to, create, incur or suffer to exist any Lien in, of or on the
Property of TLGI, such Borrower or such Subsidiary, as applicable, or apply to
the U.S. Court or Canadian Court for the authority to do any of the foregoing,
except:

     (a)       Liens granted to the Agent for the benefit of the Lenders and the
L/C Issuer pursuant to the Loan Documents or authorized by the Borrowing Order;

     (b)       Liens in existence as of the Petition Date;

     (c)       Liens for taxes, assessments or governmental charges or levies on
its Property if the same shall not at the time be delinquent or thereafter can
be paid without penalty, or are being contested in good faith and by appropriate
proceedings and for which adequate reserves in accordance with GAAP shall have
been set aside on its books;

     (d)       Liens imposed by law, such as carriers', warehousemen's and
mechanics' liens and other similar liens arising in the ordinary course of
business which secure payment of obligations not more than 60 days past due or
which are being contested in good faith by appropriate proceedings and for which
adequate reserves shall have been set aside on its books;

     (e)       Liens arising out of pledges or deposits under worker's
compensation laws, unemployment insurance, old age pensions or other social
security or retirement benefits, or similar legislation (except ERISA);

     (f)       utility easements, building restrictions and such other
encumbrances or charges against real property as are of a nature generally
existing with respect to properties of a similar character and which do not in
any material way affect the same or interfere with the use thereof in the
business of TLGI, any Borrower or any other Subsidiary;

     (g)       deposits to secure statutory obligations, surety and appeal
bonds, performance bonds and other obligations of a like nature incurred in the
ordinary course of business in an amount not to exceed $2,000,000 in the
aggregate; and

     (h)       Liens in connection with Asset Sales permitted under this
Agreement and with respect to which no objection has been interposed by the
Official Committee of Unsecured Creditors in the Chapter 11 Cases in an amount
not to exceed $10,000,000.

     (i)       Liens upon certain bank accounts maintained by certain Borrowers
at Comerica Bank as set forth in paragraph 12(b) of the Motion of Debtors and
Debtors-In-Possession for Entry of an Order (A) Approving Compromise and
Settlement with Craig R. Bush and Affiliated Entities and (B) Granting Certain
Related Relief filed with the U.S. Court on February 3, 2000 and granted
pursuant to an order entered by the U.S. Court on March 23, 2000.

     7.21      INTENTIONALLY OMITTED.

     7.22      INTEREST COVERAGE RATIO. The Borrowers shall not permit, at the
end of any fiscal quarter, the ratio of (x) Consolidated Operating Cash Flow to
(y) Consolidated Interest Charges (excluding non-cash interest accruals in
connection with the Prepetition Indebtedness) to be less than 3 to 1.

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<PAGE>

     7.23      MINIMUM FUNERAL HOME GROSS MARGIN. The Borrowers shall not permit
Funeral Home Gross Margin for any one fiscal quarter period to be less than
$35,000,000 as of the end of such fiscal quarter.

     7.24      OWNERSHIP OF COMPANY. TLGI will at all times maintain the Company
as a Wholly-Owned Subsidiary of TLGI.

     7.25      ACQUISITIONS. Neither TLGI nor any Borrower will, nor will they
permit any Subsidiary to, make any Acquisition of any Person without the prior
written consent of the Required Lenders, except for (a) acquisitions or equity
repurchases made in order to buy out holders of Minority Interests in
Subsidiaries in connection with bona fide anticipated asset sales relating to
the stock or assets of such Subsidiaries and (b) other acquisitions, PROVIDED
that the consideration paid in connection with any such acquisition referred to
in clause (a) or (b) shall be in an aggregate amount not to exceed $2,000,000
for each such acquisition individually or $10,000,000 in the aggregate during
any twelve-month period.

     7.26      SUBSIDIARIES. The Borrowers will not permit any of their
respective Subsidiaries at any time after the Closing Date to issue any
preferred stock of any type or nature or agree by contract or otherwise to any
restriction on the right and ability of such Subsidiary to declare and pay
dividends and make other distributions to its shareholders (other than the
restrictions set forth in this Agreement and the other Loan Documents). TLGI and
the Borrowers will not permit any Indebtedness owed by them to any
Subsidiaries arising after the Closing Date to be secured pursuant to the
Collateral Trust Agreement.

     7.27      SYNTHETIC LEASES. Neither TLGI nor any Borrower will, nor will
they permit any Subsidiary of it to, be an obligor in respect of any
post-Petition Date Synthetic Lease.

     7.28      DELIVERIES REGARDING ADDITIONAL BORROWERS. Not later than 30
days after the Closing Date, the Borrowers will use reasonable efforts to cause
each Subsidiary listed on SCHEDULE 7.28 annexed hereto to execute and deliver to
the Agent, and in the event that any Person becomes a U.S. Subsidiary after the
date hereof, the Borrowers will promptly notify the Agent of that fact and cause
such Subsidiary to execute and deliver to the Agent, (x) a joinder agreement
substantially in the form of EXHIBIT H annexed hereto pursuant to which such
Person shall agree to be bound by this Agreement as a Borrower and to assume and
perform its obligations as a borrower hereunder as if were a Borrower hereunder
on the date hereof, and (y) a counterpart of the Security Agreement, and to take
all such further actions and execute all such further documents and instruments
as may be necessary or, in the opinion of the Agent, desirable to create in
favor of the Agent, for the benefit of Lenders, a valid and perfected Lien on
all of the real, personal and mixed property assets of such Subsidiary described
in the applicable forms of Collateral Documents. TLGI and the Borrowers shall
deliver to the Agent a copy (each document identified below to be dated and/or
certified as of a date reasonably acceptable to the Agent not more than 30 days
prior to the date of delivery thereof to the Agent), with respect to each such
Borrower, of such Borrower's (i) articles of incorporation or comparable
constitutive documents, together with all material amendments, and, to the
extent applicable, a certificate of good standing, in each case certified by the
appropriate governmental officer in the relevant jurisdiction of organization,
(ii) by-laws or comparable constitutive laws, rules or regulations certified by
the Secretary, Assistant Secretary or other appropriate officer or director of
it, and (iii) board of directors' resolutions, certified by the Secretary,
Assistant Secretary or other appropriate officer or director of such Borrower
(and resolutions of other bodies, if any are deemed necessary by counsel for the
Agent) authorizing the execution and performance by such Borrower of this
Agreement and the Collateral Documents.

                                       53
<PAGE>

     The actions described in this SECTION 7.28 must be completed with respect
to any Borrower which is a U.S. Subsidiary formed or acquired after the Closing
Date no later than 30 days after any such Person becomes a Subsidiary.

     7.29      Intentionally Omitted.

     7.30      CHAPTER 11 CLAIMS. Without limiting the provisions of
SECTION 7.20 hereof, no Borrower shall incur, create, assume, suffer or permit
any claim or Lien or encumbrance against it or any of its property or assets in
any Chapter 11 Case (other than the claims specifically referred to in SECTION
2.20 and the Borrowing Order but only to the extent therein described) to be
PARI PASSU with or senior to the claims of the Agent and Lenders against any
Borrower in respect of the Obligations hereunder, or apply to the U.S. Courts
for authority to do so, except to the extent permitted herein.

     7.31      LIMITATION ON REPAYMENTS. The Borrowers shall not (i)
make any payment or prepayment on or redemption or acquisition for value
(including, without limitation, by way of depositing with the trustee with
respect thereto money or securities before due for the purpose of paying when
due) of any Prepetition Indebtedness or other pre-Petition Date obligations of
such Person, except for, without duplication, repayments of Prepetition
Indebtedness made in connection with Asset Sales permitted under this Agreement
to holders of Prepetition Indebtedness in an aggregate amount not to exceed
$7,500,000, or (ii) except as set forth in clause (i) hereof pay any interest on
any Prepetition Indebtedness of such Person (whether in cash, in kind securities
or otherwise), or (iii) make any payment or create or permit any Lien pursuant
to Section 361 of the Bankruptcy Code (or pursuant to any other provision of the
Bankruptcy Code authorizing adequate protection); PROVIDED that, without
duplication, (a) the Borrowers may pay Prepetition Indebtedness arising in
connection with the assumption of contracts or leases in the Chapter 11 Cases,
(b) the Borrowers may make payments permitted under SECTION 2.20, (c) the
Borrowers may make payments for administrative expenses that are allowed and
payable under Sections 330 and 331 of the Bankruptcy Code (subject to the
limitations of the Carve-Out), (d) the Borrowers may pay any post-Petition Date
expense incurred in the ordinary course of business, including all post-Petition
Date Indebtedness incurred in the ordinary course of business or approved by
order of the U.S. Court, and usual and customary employee salaries and benefits,
and (e) the Borrowers may make payments to such other claimants and in such
amounts as contemplated in SCHEDULE 1.1(b) or as may otherwise be consented to
by the Required Lenders and approved by the U.S. Court.

     7.32      PROTOCOL. TLGI and the Borrowers shall comply with the protocol
currently in place in the Chapter 11 Cases and the Canadian Cases.

     7.33      AGREEMENTS. TLGI and the Borrowers shall not assume, reject,
cancel, terminate, breach or modify (whether pursuant to Section 365 of the
Bankruptcy Code or the CCAA Orders or any other Applicable Law), (i) any
Material Contract or (ii) any other agreement, contract, instrument or other
document to which it is a party which assumption, rejection, cancellation,
termination, breach or modification could reasonably be expected to result in a
Material Adverse Effect.

     7.34       POST CLOSING DELIVERIES. To the extent not previously delivered
to the Existing Agent in connection with the Existing DIP Credit Agreement, the
Borrowers shall deliver to the Agent a copy of a title report for each real
property asset of the Borrowers promptly after it is received by the Borrowers
or retrieved from their records.

                                       54
<PAGE>

                                  ARTICLE VIII
                                    DEFAULTS

     The occurrence of any one or more of the following events shall constitute
a Default:

     8.1       Any representation or warranty made or deemed made by or on
behalf of any Credit Party to the Lenders or the Agent under or in connection
with this Agreement, any Revolving Loan, any Letter of Credit, the Collateral
Documents, any other Loan Document or any certificate or information
delivered in connection with this Agreement or any other Loan Document shall
be materially false on the date as of which made or deemed made.

     8.2       Nonpayment of principal of any Revolving Loan when due, or
nonpayment of interest upon any Revolving Loan or of any commitment fee or other
obligations (including, without limitation, Reimbursement Obligations) under any
of the Loan Documents within three Business Days after the same becomes due.

     8.3       The breach by TLGI, any Borrower or any Subsidiaries of any of
the terms or provisions of SECTION 7.2, SECTION 7.3(a), SECTIONS 7.12 through
7.27, or SECTIONS 7.30 through 7.34; PROVIDED, HOWEVER, any failure to provide
notice of any Unmatured Default pursuant to SECTION 7.3(a) shall not give rise
to a Default under this SECTION 8.3 if such Unmatured Default may be cured
pursuant to the terms of this Agreement and is in fact cured prior to maturing
into a Default.

     8.4       The breach by TLGI, any Borrower or any of their Subsidiaries
(other than a breach which constitutes a Default under SECTION 8.1, 8.2 or 8.3)
of any of the terms or provisions of this Agreement or any other Loan Document
which is not remedied within the earlier to occur of (x) 30 days after written
notice of such breach from the Agent or any Lender or (y) 30 days after any
Executive Officer first has knowledge thereof.

     8.5       Failure of TLGI, any Borrower or any of their Subsidiaries to pay
any Indebtedness (other than Indebtedness referred to in SECTION 8.2 and any
Indebtedness incurred prior to the Petition Date) equal to or exceeding
$5,000,000 in the aggregate for TLGI, such Borrower and such Subsidiaries when
due; or the default by TLGI, any Borrower or any Subsidiaries in the performance
of any term, provision or condition contained in any agreement under which any
Indebtedness (other than Indebtedness referred to in SECTION 8.2 and any
Indebtedness incurred prior to the Petition Date) equal to or exceeding
$5,000,000 in the aggregate for TLGI, such Borrower and such Subsidiaries was
created or is governed, or any other event shall occur or condition exist the
effect of which is to cause, or to permit the holder or holders of such
Indebtedness to cause, such Indebtedness to become due prior to its stated
maturity; or any Indebtedness (other than Indebtedness referred to in SECTION
8.2 and any Indebtedness incurred prior to the Petition Date) of TLGI, any
Borrower or any Subsidiaries of either equal to or exceeding $5,000,000 in the
aggregate for all such Persons shall be declared to be due and payable or
required to be prepaid (other than by a regularly scheduled payment) prior to
the stated maturity thereof, or TLGI, any Borrower or any Subsidiary of either
shall not pay, or shall admit in writing its inability to pay, its debts
incurred postpetition generally as they become due.

     8.6       With respect to the Chapter 11 Cases, (i) the entry of an order
authorizing any Borrower in any of the Chapter 11 Cases to obtain additional
financing under Section 364(c) or (d) of the Bankruptcy Code, or authorizing any
Person to recover from any portions of the Collateral any costs or expenses of
preserving or disposing of such Collateral under Section 506(c) of the
Bankruptcy Code, or (except as provided in the Borrowing Order) authorizing the
use of cash collateral without the Agent's prior written consent under Section
363(c) of the Bankruptcy Code; (ii) the appointment of an interim or permanent
trustee in any of the Chapter 11 Cases or the appointment of an examiner in any
of the Chapter 11 Cases with expanded powers to operate or manage the financial
affairs, the business, or reorganization of any Borrower; (iii) the dismissal of
any

                                       55
<PAGE>

of the Chapter 11 Cases, or the conversion of any of the Chapter 11 Cases to
a case under Chapter 7 of the Bankruptcy Code, unless the Borrower or Borrowers
subject to such dismissal or conversion are, in the judgment of the Agent,
immaterial either individually or in the aggregate; (iv) the entry of an order
granting relief from or modifying the automatic stay of Section 362 of the
Bankruptcy Code (a) to allow any creditor to execute upon or enforce a Lien on
any material portion of the Collateral or on any other property or assets of any
Borrower material to the property and assets of the Borrowers, taken as a whole,
or (b) with respect to any Lien of, or the granting of any Lien on any material
portion of the Collateral or any other material property or assets of any of the
Borrowers, in each case in the Agent's reasonable judgement, either individually
or taken as a whole, to, any State or local environmental or regulatory agency
or authority; (v) other than as approved by the Agent, the entry of an order
amending, supplementing, staying, vacating or otherwise modifying any of the
Borrowing Order or this Agreement or any other Loan Document or any of the
Agent's or the Lenders' rights, benefits, privileges or remedies under the
Borrowing Order, this Agreement or any other Loan Document; (vi) the entry of an
order reconsolidating or combining any Borrower with any other Person (other
than a Borrower); (vii) an order shall be entered approving, or there shall
arise, any other administrative expense claim (other than those specifically
referred to in SECTION 2.20) having any priority over, or being PARI PASSU with
the administrative expense priority of the Obligations in respect of any of the
Chapter 11 Cases; (viii) filing by any of the Credit Parties of, or support by
any of them for, any motion or proceeding which could reasonably be expected to
result in any impairment of the Lenders' rights under this Agreement (a
"MATERIAL ADVERSE ACTION"); or (ix) a final judgment or other judicial
determination not subject to further review in any Material Adverse Action by
any other party in interest which results in any impairment of the Lenders'
rights under this Agreement.

     8.7       With respect to the Canadian Cases (i) the making of an order
authorizing TLGI or any Canadian Subsidiary in the Canadian Cases to obtain
financing without the Required Lenders' prior written consent; (ii) the making
of an order by the Canadian Court granting relief from or modifying the stay of
proceedings under the CCAA Orders (a) to allow any creditor to execute upon or
enforce a Lien on any material property or assets of TLGI and the Canadian
Subsidiaries, taken as a whole, or to appoint a receiver and manager, receiver,
trustee, administrator or liquidator of or in respect of a material portion of
the property or assets of TLGI and the Canadian Subsidiaries, taken as a whole,
or the issuance of any receiving order or orders in respect of TLGI or any
Canadian Subsidiary or (b) to allow any party other than TLGI or a Canadian
Subsidiary to reject, cancel, terminate, breach, modify or accelerate any
obligations of TLGI or a Canadian Subsidiary under (1) any Prepetition
Indebtedness, (2) any Material Contract, or (3) any other agreement, contract,
instrument or other document to which TLGI or any Canadian Subsidiary is a
party, which rejection, cancellation, termination, breach, modification or
acceleration could reasonably be expected to result in a Material Adverse
Effect, or (c) with respect to any Lien of any federal or provincial
environmental or regulatory agency or authority (whether or not such Lien is
preserved or created under the CCAA); (iii) the failure of TLGI and the Canadian
Subsidiaries to obtain an order extending the stay of proceedings under the CCAA
Orders during the pendency of the Chapter 11 Cases; (iv) the making of an order
in the Canadian Cases amending, supplementing, staying, vacating or otherwise
modifying the CCAA Orders, this Agreement or any other Loan Document, or any of
the Agent's or any Lender's rights, benefits, privileges, remedies or priorities
under the CCAA Orders, this Agreement or any other Loan Document; (v) the making
of any order creating a Lien on any material assets or property of TLGI and the
Canadian Subsidiaries, in the reasonable judgment of the Agent, either
individually taken as a whole, other than the Permitted Canadian CCAA Liens;

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(vi) an order is made modifying or terminating the CCAA Orders in a way not
approved in writing by the Required Lenders; or (vii) the removal of or change
of the Monitor or a change in the duties and responsibilities of the Monitor
shall occur which is not approved in writing by the Required Lenders.

     8.8       TLGI, any Borrower or any of their Subsidiaries shall fail within
30 days to pay, bond or otherwise discharge any judgment or order (as to
post-Petition Date liability or debt) for the payment of money in excess of
$5,000,000, unless such judgment or order has been stayed on appeal or otherwise
is being appropriately contested in good faith and against which appropriate
reserves have been established in accordance with GAAP (provided that, in any
event, execution of such judgment or order has been effectively stayed and no
execution thereof has commenced and is continuing).

     8.9       The Unfunded Liabilities of all Single Employer Plans shall
exceed in the aggregate $5,000,000 or any Reportable Event, the occurrence of
which may reasonably be expected to give rise to a Material Adverse Effect,
shall occur in connection with any Plan, or a contribution failure sufficient to
give rise to a lien under section 302(f) of ERISA shall occur with respect to
any Single Employer Plan.

     8.10      TLGI or any other member of the Controlled Group shall have been
notified by the sponsor of a Multiemployer Plan that it has incurred withdrawal
liability to such Multiemployer Plan in an amount which, when aggregated with
all other amounts required to be paid to Multiemployer Plans by TLGI or any
other member of the Controlled Group as withdrawal liability (determined as of
the date of such notification), exceeds $5,000,000 or requires payments
exceeding $1,000,000 per annum.

     8.11      TLGI or any other member of the Controlled Group shall have been
notified by the sponsor of a Multiemployer Plan that such Multiemployer Plan is
in reorganization or is being terminated, within the meaning of Title IV of
ERISA, if as a result of such reorganization or termination the aggregate annual
contributions of TLGI and the other members of the Controlled Group (taken as a
whole) to all Multiemployer Plans which are then in reorganization or being
terminated have been or will be increased over the amounts contributed to such
Multiemployer Plans for the respective plan years of each such Multiemployer
Plan immediately preceding the plan year in which the reorganization or
termination occurs by an amount exceeding $1,000,000.

     8.12      TLGI, any Borrower or any of their Subsidiaries shall be the
subject of any proceeding or investigation pertaining to a Release by TLGI, any
Borrower or any such Subsidiary or any other Person, or any violation of any
Environmental Law, which, in either case, could reasonably be expected to have a
Material Adverse Effect.

     8.13      Any Change of Control shall occur.

     8.14      Any Collateral Document shall fail to remain in full force or
effect, or any action shall be taken to discontinue or to assert the invalidity
or unenforceability of any Collateral Document, or any pledgor thereunder shall
fail to perform its obligations under or otherwise comply with any of the terms
or provisions of any Collateral Document, or any pledgor thereunder shall deny
that it has any further liability under any Collateral Document, or shall give
notice to such effect, or any portion of the shares of stock pledged, or
security interests granted, pursuant to any Collateral Document shall cease
(after the time permitted for perfection hereunder shall have expired) to be
validly perfected in favor of the Agent for the benefit of the Lenders, or
(except as otherwise provided in the Collateral Documents and except to the
extent such pledged shares represent Minority Interests) such pledged shares

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shall fail to represent 100% of the outstanding shares of stock of the
Subsidiaries whose shares of stock are subject to the Collateral Documents.

     8.15      A Material Judgment Event shall have occurred and 90 days shall
have passed without one or more of the judgments, awards or other orders giving
rise to such Material Judgment Event having been vacated such that on such 90th
day the aggregate amount of all judgments, awards and orders as to post-Petition
Date liability or debt entered against any of TLGI, any Borrower or any of their
respective Subsidiaries which shall have been outstanding for at least 90 days
without having been finally satisfied in full or vacated shall be in excess of
$1,000,000.

     8.16      (i) Any law, governmental rule, regulation or order binding on
TLGI or any Borrower, or any change or modification therein or in the
interpretation, administration or application thereof, shall become effective
after the date hereof, or (ii) any license, authorization or permit of TLGI
or any Borrower shall be canceled, terminated, rescinded, revoked, suspended,
impaired, otherwise finally denied renewal or otherwise modified in any
material respect, or (iii) any license, authorization or permit of TLGI or
any Borrower shall be renewed on terms different from the terms of the
license, authorization or permit so renewed, and the occurrence of any such
event or events described in clauses (i), (ii) and/or (iii), individually or
in the aggregate, (a) adversely affects the economic or commercial value or
usefulness of the Borrower's licenses, permits and authorizations in any
State of the United States or province of Canada in a manner which could
reasonably be expected to have a Material Adverse Effect, or (b) impedes the
transfer of cash (other than cash required to be placed in trust pursuant to
regulatory requirements materially consistent with those in effect on the
Closing Date) generated through operations of any Borrower from one State of
the United States or province of Canada to another such State or province
through the cash management system described on SCHEDULE 6.21 in a manner
which could reasonably be expected to have a Material Adverse Effect, or (c)
could otherwise reasonably be expected to have a Material Adverse Effect.

                                   ARTICLE IX
                 ACCELERATION, WAIVERS, AMENDMENTS AND REMEDIES

     9.1       ACCELERATION. If any Default occurs the Agent may, and upon
written request of the Required Lenders shall (notwithstanding the provisions of
Section 362 of the Bankruptcy Code and without application or motion to, or
order from, the U.S. Court or the Canadian Court), (a) terminate or suspend the
obligations of the Lenders to make Revolving Loans and purchase participations
in Letters of Credit hereunder, whereupon the obligation of the L/C Issuer to
issue Letters of Credit hereunder shall also terminate or be suspended, or (b)
declare the Obligations to be due and payable, whereupon the Obligations
(including an amount equal to the maximum amount that may at any time be drawn
under all Letters of Credit then outstanding (whether or not any beneficiary
under any such Letter of Credit shall have presented, or shall be entitled at
such time to present, the drafts or other documents or certificates required to
drawn under such Letter of Credit)) shall become immediately due and payable,
without presentment, demand, protest or notice of any kind, all of which TLGI
and each Borrower hereby expressly waive, or (c) take the action described in
both the preceding CLAUSE (a) and the preceding CLAUSE (b).

     If, within 30 days after acceleration of the maturity of the Obligations or
termination of the obligations of the Lenders to make Revolving Loans hereunder
as a result of any Default (other than any Default as described in SECTION 8.6
with respect to TLGI, any Borrower or any other Subsidiary) and before any
judgment or decree for the payment of the Obligations due shall have been

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obtained or entered, the Required Lenders (in their sole discretion) shall so
direct, the Agent shall, by notice to TLGI and the Borrowers, rescind and annul
such acceleration and/or termination.

     Further upon the occurrence and during the continuance of any Default, the
Agent may (i) exercise all rights and remedies of the Agent set forth in any of
the Collateral Documents, in addition to all rights and remedies allowed by, the
United States and of any state thereof or Canada and any province thereof,
including but not limited to the UCC, and (ii) revoke the Borrowers' rights to
use cash collateral in which the Agent has an interest; PROVIDED that, any other
provision of this Agreement or any other Loan Document to the contrary
notwithstanding, with respect to the foregoing, the Agent shall give the
Borrowers and counsel to any official committees in respect of the Chapter 11
Cases and the office of the United States Trustee five days prior written notice
(which notice shall be delivered by facsimile or overnight courier) of the
exercise of its rights and remedies with respect to the Collateral and file a
copy of such notice with the clerk of the U.S. Court. Neither the Agent nor the
Lenders shall have any obligation of any kind to make a motion or application to
the U.S. Court or the Canadian Court to exercise their rights and remedies set
forth or referred to in this Agreement or in the other Loan Documents. The
enumeration of the foregoing rights and remedies is not intended to be
exhaustive and the exercise of any right or remedy shall not preclude the
exercise of any other rights or remedies in the Loan Documents or the Borrowing
Order, all of which shall be cumulative and not alternative.

     TLGI and the Borrowers waive, (i) presentment, demand and protest and
notice of presentment, dishonor, notice of intent to accelerate, notice of
acceleration, protest, default, nonpayment, maturity, release, compromise,
settlement, extension or renewal of any or all commercial paper, accounts,
contract rights, documents, instruments, chattel paper and guaranties or other
property at any time held by the Agent or the Lenders on which the Borrowers may
in any way be liable and hereby ratify and confirm whatever the Agent and the
Lenders may lawfully do in this regard, (ii) subject to the notice provisions of
the preceding paragraph, all rights to notice and hearing prior to the Agent's
taking possession or control of, or to the Agent or the Lenders reply,
attachment or levy upon, the Collateral, or any bond or security which might be
required by any court prior to allowing the Agent or the Lenders to exercise any
of their remedies, and (iii) the benefit of all valuation, appraisal and
exemption laws. The Borrowers acknowledge they have been advised by counsel of
their choice with respect to the effect of the foregoing waivers and this
Agreement, the other Loan Documents and the transactions evidenced by this
Agreement and the other Loan Documents.

     9.2       AMENDMENTS. Subject to the provisions of this ARTICLE IX, the
Required Lenders (or the Agent with the consent in writing of the Required
Lenders), TLGI and the Borrowers may enter into agreements supplemental hereto
for the purpose of adding or modifying any provisions to the Loan Documents or
changing in any manner the rights of the Lenders, TLGI or the Borrowers
hereunder or waiving any Default hereunder; PROVIDED, HOWEVER, that no such
supplemental agreement shall, without the consent of each Lender affected
thereby:

     (a)       extend the Commitment of any Lender, extend the maturity of any
Revolving Loan, extend the final maturity of any Reimbursement Obligation beyond
the Commitment Termination Date, extend the expiry date of any Standby Letter of
Credit beyond the date which is five Business Days immediately preceding the
Commitment Termination Date, extend the expiry date of any Commercial Letter of
Credit beyond the date which is 10 days immediately preceding the Commitment
Termination Date, or forgive all or any portion of the principal amount of any
Revolving Loan or Reimbursement Obligation or any interest or fees, or reduce

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the rate or extend the time of payment of interest or fees on any Revolving
Loan, Reimbursement Obligation, Commitment or Letter of Credit;

     (b)       reduce the percentage specified in the definition of Required
Lenders;

     (c)       increase the amount of the Commitment of any Lender hereunder, or
permit TLGI or any Borrower to assign its rights under this Agreement;

     (d)       amend this SECTION 9.2 or SECTION 13.1(a);

     (e)       release a Borrower other than in connection with an Approved Sale
or as set forth in the Loan Documents; or

     (f)       release all or substantially all of the Collateral other than in
connection with an Approved Sale or as set forth in the Loan Documents.

     No amendment of any provision of this Agreement relating in any way to the
Agent shall be effective without the written consent of the Agent. No amendment
of any provision of this Agreement relating in any way to the L/C Issuer or any
or all of the Letters of Credit shall be effective without the written consent
of the L/C Issuer and the Agent. The Agent may waive payment of the fee required
under SECTION 13.3.2 without obtaining the consent of any other party to this
Agreement.

     9.3       PRESERVATION OF RIGHTS. No delay or omission of the Lenders or
any of them or the Agent or the L/C Issuer to exercise any right under the Loan
Documents shall impair such right or be construed to be a waiver of any Default
or an acquiescence therein, and the making of a Revolving Loan or the issuance
of a Letter of Credit notwithstanding the existence of a Default or the
inability of the Borrowers to satisfy the conditions precedent to such Revolving
Loan or Letter of Credit shall not constitute any waiver or acquiescence. Any
single or partial exercise of any such right shall not preclude other or further
exercise thereof or the exercise of any other right, and no waiver, amendment or
other variation of the terms, conditions or provisions of the Loan Documents
whatsoever shall be valid unless in writing signed by (or with the consent of)
the Lenders required pursuant to SECTION 9.2, and then only to the extent
specifically set forth in such writing. All remedies contained in the Loan
Documents or afforded by law shall be cumulative and all shall be available to
the Agent, the Lenders and the L/C Issuer until the Obligations have been paid
in full.

                                    ARTICLE X
                               GENERAL PROVISIONS

     10.1      SURVIVAL OF REPRESENTATIONS. All representations and warranties
of TLGI and the Borrowers contained in this Agreement shall survive the
occurrence of the effectiveness of this Agreement and the making of the
Revolving Loans and the issuance of the Letters of Credit herein contemplated.

     10.2      GOVERNMENTAL REGULATION. Anything contained in this Agreement to
the contrary notwithstanding, no Lender shall be obligated to extend credit to
the Borrowers and the L/C Issuer shall not be obligated to issue any Letter of
Credit in violation of any limitation or prohibition provided by any applicable
statute or regulation.

     10.3      STAMP DUTIES. The Borrowers shall pay and forthwith on demand
indemnify each of the Agent, each Lender and the L/C Issuer against any
liability it incurs in respect of any stamp, registration and similar tax which
is or becomes payable in connection with the entry into, performance or
enforcement of any Loan Document.

     10.4      HEADINGS. Section headings in the Loan Documents are for
convenience of reference only and shall not govern the interpretation of any of
the provisions of the Loan Documents.

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     10.5      ENTIRE AGREEMENT, INDEPENDENCE OF COVENANTS. The Loan Documents
(together with the Fee Letter) embody the entire agreement and understanding
among TLGI, the Borrowers, the Agent, the Lenders and the L/C Issuer and
supersede all prior agreements and understandings among TLGI, the Borrowers, the
Agent, the Lenders and the L/C Issuer relating to the subject matter thereof.
Except as otherwise expressly provided herein, no provision of this Agreement
shall be construed as waiving, negating or otherwise qualifying any restriction,
limitation or other condition imposed by any other provision of this Agreement.

     10.6      SEVERAL OBLIGATIONS; BENEFITS OF THIS AGREEMENT. The respective
obligations of the Lenders hereunder are several and not joint and no Lender
shall be the partner or agent of any other (except to the extent to which the
Agent is authorized to act as such). The failure of any Lender to perform any of
its obligations hereunder shall not relieve any other Lender from any of its
obligations hereunder. This Agreement shall not be construed so as to confer any
right or benefit upon any Person other than the parties to this Agreement and
their respective successors and assigns.

     10.7      EXPENSES, INDEMNIFICATION. Whether or not the transactions
contemplated hereby shall be consummated, the Borrowers jointly and severally
agree to pay promptly (i) all the actual and reasonable costs and expenses of
the Agent, including the reasonable fees, expenses and disbursements of Morgan,
Lewis & Bockius LLP, counsel to the Agent, in connection with the negotiation,
preparation and execution of the Loan Documents; (ii) all the costs of
furnishing all opinions by counsel for the Borrowers (including any opinions
requested by the Agent as to any legal matters arising hereunder) and of each
Borrower's performance of and compliance with all agreements and conditions on
its part to be performed or complied with under this Agreement and the other
Loan Documents including with respect to confirming compliance with
environmental and insurance requirements; (iii) the reasonable fees, expenses
and disbursements of counsel to the Agent (including allocated costs of internal
counsel) providing services and advice to the Agent in connection with the
administration of the Loan Documents and any consents, amendments, waivers or
other modifications thereto and the transactions contemplated thereby and any
other documents or matters requested by the Borrowers; (iv) all the actual costs
and reasonable expenses of creating and perfecting Liens in favor of the Agent
on behalf of Lenders pursuant to any Collateral Document, including filing and
recording fees, expenses and taxes, stamp or documentary taxes, search fees,
title insurance premiums, and reasonable fees, expenses and disbursements of
counsel to the Agent and of counsel providing any opinions that the Agent may
reasonably request in respect of the Collateral Documents or the Liens created
pursuant thereto; (v) all the actual costs and reasonable expenses (including
the reasonable fees, expenses and disbursements of any auditors, accountants or
appraisers and any environmental or other consultants, advisors and agents
employed or retained by the Agent and its counsel) of obtaining and reviewing
information regarding the Collateral; (vi) all the actual costs and reasonable
expenses (including the reasonable fees, expenses and disbursements of any
consultants, advisors and agents employed or retained by the Agent and its
counsel) in connection with the custody or preservation of any of the
Collateral; (vii) all other actual and reasonable costs and expenses incurred by
the Agent and First Union Securities, Inc. in connection with the syndication of
the Commitments; and (viii) after the occurrence and during the continuance of a
Default, all costs and expenses, including reasonable attorneys' fees (including
allocated costs of internal counsel), the reasonable fees and expenses of a
financial advisor retained by the Agent and costs of settlement, incurred by the
Agent and Lenders in enforcing any Obligations of or in collecting any payments
due from any Borrower hereunder or under the other Loan Documents by reason of
such Default (including in connection with the sale of, collection from, or

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other realization upon any of the Collateral). Without limiting the generality
of the foregoing, if, at any time or times, regardless of the existence of a
Default, the Agent or any Lender shall incur reasonable expenses itself or
employ counsel or other professional advisors, including, but not limited to,
environmental, financial and management consultants, for advice or other
representation or shall incur legal, appraisal, accounting, consulting or other
reasonable costs and expenses in connection with actions or claims asserted
against the Agent or such Lender in respect of:

               (i)       any litigation, contest, dispute, suit, proceeding or
          action (whether instituted by the Agent, any Lender, any Borrower or
          any other Person) in any way relating to the Collateral, any of the
          Loan Documents, or any other agreements to be executed or delivered in
          connection therewith or herewith, including any litigation, contest,
          dispute, suit, case, proceeding or action, and any appeal or review
          thereof, in connection with a case or proceeding commenced by or
          against any Borrower or any other Person that may be obligated to the
          Agent or any Lender by virtue of the Loan Documents, under the
          Bankruptcy Code, or any other applicable Federal, state, or foreign
          bankruptcy or other similar law;

               (ii)      any attempt to enforce any rights or remedies of the
          Agent or any Lender against any Borrower, or any other Person that may
          be obligated to the Agent or any Lender by virtue of being a party to
          any of the Loan Documents;

               (iii)     any attempt to appraise, inspect, verify, protect,
          collect, sell, liquidate or otherwise dispose of the Collateral,
          including without limitation, obtaining and reviewing any reports
          provided for under SECTION 4.1; or

               (iv)      any Chapter 11 Case and any Canadian Case (including,
          without limitation, the on-going monitoring by the Agent of any
          Chapter 11 Case and any Canadian Case, including attendance by the
          Agent and its counsel at hearings or other proceedings and the
          on-going review of documents filed with a U.S. Court or a Canadian
          Court in respect thereof) and the Agent's and the Lenders' interests
          with respect to any Borrower (including, without limitation, the
          on-going review of any Borrower's business, assets, operations,
          prospects or financial condition as the Agent shall deem necessary),
          the Collateral or the Obligations (but only to the extent relating to
          the Loan Documents and the Obligations);

then, and in any such event, the reasonable fees and expenses incurred by the
Agent and such attorneys and other professional advisors and consultants arising
from such services, including those of any appellate proceedings, and all
reasonable expenses, costs, charges and other fees incurred by such counsel or
other professionals in any way or respect arising in connection with or relating
to any of the events or actions described in this SECTION 10.7 shall be payable,
on demand and presentation of a reasonably detailed invoice, by the Borrowers to
the Agent and shall be additional Obligations secured under the Collateral
Documents and the other Loan Documents. Any fees and expenses payable pursuant
to this SECTION 10.7 shall be paid without the necessity of any court approval
or application by the Agent or any Lender, unless otherwise ordered by the U.S.
Court. In addition to the payment of expenses pursuant to this SECTION 10.7,
whether or not the transactions contemplated hereby shall be consummated, the
Borrowers jointly and severally agree to defend (subject to Indemnitees'
selection of counsel), indemnify, pay and hold harmless Agents, First Union
Securities, Inc. and Lenders, and the officers, partners, directors, trustees,
employees, agents and affiliates of any of Agents and Lenders (collectively
called the "INDEMNITEES"), from and against any and all Indemnified Liabilities
(as hereinafter defined); PROVIDED that no Borrower shall have any obligation to

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any Indemnitee hereunder with respect to any Indemnified Liabilities to the
extent such Indemnified Liabilities arise solely from the gross negligence or
willful misconduct of that Indemnitee as determined by a final, non-appealable
judgment of a court of competent jurisdiction. As used herein, "INDEMNIFIED
LIABILITIES" means, collectively, any and all liabilities, obligations, losses,
damages (including natural resource damages), penalties, actions, judgments,
suits, claims (including Environmental Claims), costs (including the costs of
any investigation, study, sampling, testing, abatement, cleanup, removal,
remediation or other response action necessary to remove, remediate, clean up or
abate any Hazardous Materials Activity), expenses and disbursements of any kind
or nature whatsoever (including the reasonable fees and disbursements of counsel
for Indemnitees in connection with any investigative, administrative or judicial
proceeding commenced or threatened by any Person, whether or not any such
Indemnitee shall be designated as a party or a potential party thereto, and any
fees or expenses incurred by Indemnitees in enforcing this indemnity), whether
direct, indirect or consequential and whether based on any federal, state or
foreign laws, statutes, rules or regulations (including securities and
commercial laws, statutes, rules or regulations and Environmental Laws), on
common law or equitable cause or on contract or otherwise, that may be imposed
on, incurred by, or asserted against any such Indemnitee, in any manner relating
to or arising out of (i) this Agreement or the other Loan Documents or the
transactions contemplated hereby or thereby (including the Lenders' agreement to
make the Loans hereunder or the use or intended use of the proceeds thereof or
the issuance of Letters of Credit hereunder or the use or intended use of any
thereof, or any enforcement of any of the Loan Documents (including any sale of,
collection from, or other realization upon any of the Collateral)), or (ii) any
Environmental Claim or any Hazardous Materials Activity relating to or arising
from, directly or indirectly, any past or present activity, operation, land
ownership, or practice of TLGI, the Borrowers or any Subsidiaries. To the extent
that the undertakings to defend, indemnify, pay and hold harmless set forth in
this SECTION 10.7 may be unenforceable in whole or in part because they are
violative of any law or public policy, the Borrowers shall, jointly and
severally, contribute the maximum portion that it is permitted to pay and
satisfy under applicable law to the payment and satisfaction of all Indemnified
Liabilities incurred by Indemnitees or any of them. The obligations of the
Borrowers under this SECTION 10.7 shall survive payment of the Obligations and
the termination of this Agreement.

     Notwithstanding anything herein to the contrary, the reimbursement and
indemnity provisions of this SECTION 10.7 shall not apply to any obligations,
claims or liabilities arising in connection with any Prepetition Indebtedness.

     10.8      NUMBERS OF DOCUMENTS. All statements, notices, closing documents
and requests hereunder shall be furnished to the Agent with sufficient
counterparts so that the Agent may retain one and furnish one to each of the
Lenders.

     10.9      ACCOUNTING; CURRENCY CONVERSIONS. Except as provided to the
contrary herein, all accounting terms used herein shall be interpreted and all
accounting determinations hereunder shall be made in accordance with Agreement
Accounting Principles; PROVIDED, HOWEVER, that (a) to the extent that any change
in GAAP shall alter the result of any financial covenant or test or any other
accounting determination to be computed or made hereunder, TLGI and the
Borrowers agree that such covenant, test or other determination shall continue
to be computed or made on the basis of Agreement Accounting Principles as in
effect prior to such change in GAAP, unless the Required Lenders shall otherwise
consent and (b) the MIPS shall be deemed to constitute capital stock of TLGI for
purposes of this Agreement. To the extent that for purposes of computing any
financial covenant or test or making any other accounting determination
hereunder, any amount denominated in one currency must be converted into another

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currency, such conversion shall be made in a manner that accords with the
currency conversion policies and procedures used in preparing the financial
statements of TLGI, the Borrowers and the other Subsidiaries on the basis of
which the relevant computations or determinations are or will be made, unless
the Required Lenders shall have specified an alternative basis for making such
conversions.

     10.10     SEVERABILITY OF PROVISIONS. Any provision in any Loan Document
that is held to be inoperative, unenforceable or invalid in any jurisdiction
shall, as to that jurisdiction, be inoperative, unenforceable or invalid without
affecting the remaining provisions in that jurisdiction or the operation,
enforceability or validity of that provision in any other jurisdiction, and to
this end the provisions of all Loan Documents are declared to be severable.

     10.11     NONLIABILITY OF LENDERS. The relationship between the Borrowers,
on the one hand, and the Lenders, the L/C Issuer and the Agent, on the other
hand, shall be solely that of borrower and lender, and the relationship between
TLGI and the Subsidiaries (other than the Borrowers), on the one hand, and the
Lenders, the L/C Issuer and the Agent, on the other hand, shall be construed
accordingly. None of the Agent, the L/C Issuer or any Lender shall have any
fiduciary responsibilities to TLGI, the Borrowers or any other Subsidiary. None
of the Agent, the L/C Issuer or any Lender undertakes any responsibility to
TLGI, the Borrowers or any other Subsidiary to review or inform TLGI, the
Borrowers or any other Subsidiary of any matter in connection with any phase of
the business or operations of TLGI, the Borrowers or any other Subsidiary.

     10.12     CHOICE OF LAW. THE LOAN DOCUMENTS (OTHER THAN THOSE CONTAINING A
CONTRARY EXPRESS CHOICE OF LAW PROVISION) SHALL BE CONSTRUED IN ACCORDANCE WITH
THE INTERNAL LAWS OF THE STATE OF NEW YORK, BUT GIVING EFFECT TO FEDERAL LAWS
APPLICABLE TO NATIONAL BANKS.

     10.13     CONSENT TO JURISDICTION. SUBJECT TO THE JURISDICTION OF THE U.S.
COURT, ALL JUDICIAL PROCEEDINGS BROUGHT AGAINST ANY CREDIT PARTY ARISING OUT OF
OR RELATING TO THIS AGREEMENT OR ANY OBLIGATIONS THEREUNDER, 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 CREDIT PARTY,
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 CREDIT PARTY AT ITS ADDRESS
          PROVIDED IN ACCORDANCE WITH ARTICLE XIV;

               (iv)      AGREES THAT SERVICE AS PROVIDED IN CLAUSE (III) ABOVE
          IS SUFFICIENT TO CONFER PERSONAL JURISDICTION OVER SUCH CREDIT PARTY
          IN ANY SUCH PROCEEDING IN ANY SUCH COURT, AND OTHERWISE CONSTITUTES
          EFFECTIVE AND BINDING SERVICE IN EVERY RESPECT;

               (v)       AGREES THAT THE LENDERS RETAIN THE RIGHT TO SERVE
          PROCESS IN ANY OTHER MANNER PERMITTED BY LAW OR TO BRING PROCEEDINGS
          AGAINST SUCH CREDIT PARTY IN THE COURTS OF ANY OTHER JURISDICTION; AND

               (vi)       AGREES THAT THE PROVISIONS OF THIS SECTION 10.13
          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.

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     10.14     WAIVER OF JURY TRIAL. TLGI, EACH BORROWER, THE AGENT, THE L/C
ISSUER AND EACH LENDER HEREBY WAIVE TRIAL BY JURY IN ANY JUDICIAL PROCEEDING
INVOLVING, DIRECTLY OR INDIRECTLY, ANY MATTER (WHETHER SOUNDING IN TORT,
CONTRACT OR OTHERWISE) IN ANY WAY ARISING OUT OF, RELATED TO OR CONNECTED WITH
ANY LOAN DOCUMENT OR THE RELATIONSHIP ESTABLISHED THEREUNDER.

     10.15     CONFIDENTIALITY. Each of the Agent, each Lender and the L/C
Issuer agrees to hold any confidential information identified in making as such
which it may receive from TLGI, the Borrowers or any other Subsidiary pursuant
to this Agreement in confidence, except for disclosure (a) to other Lenders, the
L/C Issuer and the Agent and their respective Affiliates, (b) to legal counsel,
accountants and other professional advisors to the Agent, the L/C Issuer or that
Lender or to a Transferee, (c) to regulatory officials and examiners, (d) to any
Person as requested pursuant to or as required by law, regulation or legal
process, (e) to any Person in connection with any legal proceeding to which the
Agent, the L/C Issuer or that Lender is a party and (f) permitted by SECTION
13.4.

     10.16     JUDGMENT CURRENCY. If the Agent, the L/C Issuer or any Lender
receives an amount in respect of the Borrowers' or TLGI's liability under the
Loan Documents or if that liability is converted into a claim, proof, judgment
or order in a currency other than the currency (the "CONTRACTUAL CURRENCY") in
which the amount is expressed to be payable under the relevant Loan Document,
(a) TLGI and the Borrowers, as applicable, shall indemnify the Agent, the L/C
Issuer or such Lender, as applicable, as an independent obligation against any
loss, cost, expense or liability arising out of or as a result of the
conversion; (b) if the amount received by the Agent, the L/C Issuer or such
Lender, as applicable, when converted into the contractual currency at a market
rate on the date of receipt by the Agent, the L/C Issuer or such Lender in the
usual course of its business, is less than the amount owed in the contractual
currency, the Borrowers or TLGI, as applicable, shall forthwith on demand pay to
the Agent, the L/C Issuer or such Lender, as applicable, an amount in the
contractual currency equal to the deficit; and (c) TLGI or the Borrowers, as
applicable, shall pay to the Agent, the L/C Issuer or such Lender, as
applicable, on demand any exchange costs and taxes payable in connection with
any such conversion. Each of the Borrowers and TLGI waives any right it may have
in any jurisdiction to the extent permitted by law to pay any amount under the
Loan Documents in a currency other than that in which it is expressed to be
payable.

     10.17     CANADIAN INTEREST ANTIDOTES. (a) Notwithstanding any other
provision of this Agreement, if and to the extent that the laws of Canada are
applicable to interest payable under this Agreement, no interest on the credit
advanced will be payable in excess of that permitted by the laws of Canada. If
the effective annual rate of interest, calculated in accordance with generally
accepted actuarial practices and principles, would exceed 60% (or such other
rate as the Parliament of Canada may determine from time to time as the criminal
rate) on the credit advanced, then: (i) the amount of any charges for the use of
money, expenses, fees, bonuses, commissions or other charges payable in
connection therewith will be reduced to the extent necessary to eliminate such
excess; (ii) any remaining excess that has been paid will be credited towards
repayment of the principal amount; and (iii) any overpayment that may remain

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after such crediting will be returned forthwith on demand. In this paragraph the
terms "interest," criminal rate" and "credit advanced" have the meaning ascribed
to them in Section 347 of the Criminal Code (Canada). [GH1]

     (b)       If and to the extent that the laws of Canada are applicable to
interest payable under this Agreement, for the purpose of the Interest Act
(Canada) the yearly rate of interest to which interest calculated on the basis
of a 360- or 365-day year is equivalent is the rate of interest determined as
herein provided multiplied by the number of days in such year and divided by 360
or 365, as the case may be.

     10.18     PARTIES INCLUDING TRUSTEES; U.S. COURT PROCEEDINGS. This
Agreement and the other Loan Documents shall be binding upon, and inure to the
benefit of, the successors of the Agent and each Lender, and the assigns,
transferees and endorsees of the Agent and each Lender. The security interests
and Liens created in this Agreement, the Collateral Documents and the other Loan
Documents shall be and remain valid and perfected, and the claims of the Agent
and the Lenders hereunder valid and enforceable in accordance with the terms
hereof, notwithstanding the discharge of any Borrower pursuant to Section 1141
of the Bankruptcy Code, the conversion of any Chapter 11 Case or any other
bankruptcy case of any Credit Party to a case under Chapter 7 of the Bankruptcy
Code, the dismissal of any Chapter 11 Case or any subsequent Chapter 7 case or
the release of any Collateral from the property of any Credit Party. The
security interests and Liens created in this Agreement, the Collateral Documents
and the other Loan Documents shall be and remain valid and perfected without the
necessity that the Agent file financing statements or otherwise perfect its
security interests or Liens under applicable law. This Agreement, the claims of
Agent and the Lenders hereunder, and all security interests or Liens created
hereby or pursuant hereto or by or pursuant to the Collateral Documents or any
other Loan Document shall at all times be binding upon the Credit Parties, the
estates of the Credit Parties and any trustee appointed in any Chapter 11 Case
or any Chapter 7 case, or any other successor in interest to the Borrowers. This
Agreement shall not be subject to Section 365 of the Bankruptcy Code.

     10.19     COUNTERPARTS; EFFECTIVENESS. This Agreement may be executed in
any number of counterparts, all of which taken together shall constitute one
agreement, and any of the parties hereto may execute this Agreement by signing
any such counterpart. This Agreement shall become effective on the Effective
Date.

                                   ARTICLE XI
                                    THE AGENT

     11.1      APPOINTMENT. First Union is hereby appointed Agent hereunder and
under each other Loan Document, and each of the Lenders irrevocably authorizes
the Agent to act as the agent of such Lender. The Agent agrees to act as such
upon the express conditions contained in this ARTICLE XI. The Agent shall not
have a fiduciary relationship in respect of TLGI, any Borrower, any other
Subsidiary or any Lender by reason of this Agreement.

     11.2      POWERS. The Agent shall have and may exercise such powers under
the Loan Documents as are specifically delegated to the Agent by the terms of
each thereof, together with such powers as are reasonably incidental thereto.
The Agent shall have no implied duties to the Lenders, or any obligation to the
Lenders to take any action thereunder except any action specifically provided by
the Loan Documents to be taken by the Agent.

     11.3      GENERAL IMMUNITY. Neither the Agent nor any of its directors,
officers, agents or employees shall be liable to any or all of TLGI, any
Borrower, any other Subsidiary, the Lenders or the L/C Issuer for any action
taken or omitted to be taken by it or them hereunder or under any other Loan

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Document or in connection herewith or therewith except for its or their own
gross negligence or willful misconduct.

     11.4      NO RESPONSIBILITY FOR REVOLVING LOANS, RECITALS, ETC. Neither the
Agent nor any of its directors, officers, agents or employees shall be
responsible for or have any duty to ascertain, inquire into, or verify (a) any
statement, warranty or representation made in connection with any Loan Document
or any extension of credit hereunder; (b) the performance or observance of any
of the covenants or agreements of any obligor under any Loan Document,
including, without limitation, any agreement by an obligor to furnish
information directly to each Lender; (c) the satisfaction of any condition
specified in ARTICLE IV, except receipt of items required to be delivered to the
Agent; or (d) the validity, effectiveness or genuineness of any Loan Document or
any other instrument or writing furnished in connection therewith. The Agent
shall have no duty to disclose to the Lenders or the L/C Issuer information that
is not required to be furnished by TLGI or the Borrowers to the Agent at such
time, but is voluntarily furnished by TLGI or the Borrowers to the Agent (either
in its capacity as Agent or in its individual capacity).

     11.5      ACTION ON INSTRUCTIONS OF LENDERS. The Agent shall in all cases
be fully protected in acting, or in refraining from acting, hereunder and under
any other Loan Document in accordance with written instructions signed by the
Required Lenders or, in the case of any act or failure to act calculated to give
rise to any of the events or circumstances described in CLAUSES (a) through (f)
of SECTION 9.2, each affected Lender, and such instructions and any action taken
or failure to act pursuant thereto shall be binding on all of the Lenders and on
all holders of Revolving Loans and participations in Reimbursement Obligations
and Letters of Credit. The Agent shall be fully justified in failing or refusing
to take any action hereunder and under any other Loan Document unless it shall
first be indemnified to its satisfaction by the Lenders PRO RATA against any and
all liability, cost and expense that it may incur by reason of taking or
continuing to take any such action.

     11.6      EMPLOYMENT OF AGENTS AND COUNSEL. The Agent may execute any of
its duties as Agent hereunder and under any other Loan Document by or through
employees, agents and attorneys-in-fact and shall not be answerable to the
Lenders or the L/C Issuer, except as to money or securities received by it or
its authorized agents, for the default or misconduct of any such agents or
attorneys-in-fact selected by it with reasonable care. The Agent shall be
entitled to advice of counsel concerning all matters pertaining to the agency
hereby created and its duties hereunder and under any other Loan Document.

     11.7      RELIANCE ON DOCUMENTS; COUNSEL. The Agent shall be entitled to
rely upon any record, notice, consent, certificate, affidavit, letter, telegram,
statement, paper or document believed by it to be genuine and correct and to
have been signed or sent by the proper person or persons and, with respect to
legal matters, upon the opinion of counsel selected by the Agent, which counsel
may be employees of the Agent.

     11.8      AGENT'S REIMBURSEMENT AND INDEMNIFICATION. The Lenders agree to
reimburse and indemnify the Agent ratably in proportion to their respective
Commitments (a) for any amounts not reimbursed by the Borrowers for which the
Agent is entitled to reimbursement by the Borrowers under the Loan Documents,
(b) for any other expenses incurred by the Agent on behalf of the Lenders, in
connection with the preparation, execution, delivery, administration and
enforcement of the Loan Documents to the extent not otherwise reimbursed by the
Borrowers and (c) for any liabilities, obligations, losses, damages, penalties,
actions, judgments, suits, costs, expenses or disbursements of any kind and
nature whatsoever which may be imposed on, incurred by or asserted against the

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Agent in any way relating to or arising out of the Loan Documents or any other
document delivered in connection therewith or the transactions contemplated
thereby, or the enforcement of any of the terms thereof or of any such other
documents, PROVIDED that no Lender shall be liable for any of the foregoing to
the extent they arise from the gross negligence or willful misconduct of the
Agent. The obligations of the Lenders under this SECTION 11.8 shall survive
payment of the Obligations and termination of this Agreement.

     11.9      RIGHTS AS A LENDER. In the event the Agent is a Lender, the Agent
shall have the same rights and powers hereunder and under any other Loan
Document as any Lender and may exercise the same as though it were not the
Agent, and the term "Lender" or "Lenders" shall, at any time when the Agent is a
Lender, unless the context otherwise indicates, include the Agent in its
individual capacity. The Agent may accept deposits from, lend money to, and
generally engage in any kind of trust, debt, equity or other transaction, in
addition to those contemplated by this Agreement or any other Loan Document,
with TLGI, any Borrower or any other Subsidiary in which TLGI, any Borrower or
any such other Subsidiary is not restricted hereby from engaging with any other
Person.

     11.10     LENDERS' CREDIT DECISIONS. Each Lender acknowledges that it has,
independently and without reliance upon the Agent or any other Lender and based
on the financial statements prepared by TLGI and the Borrowers and such other
documents and information as it has deemed appropriate, made its own credit
analysis and decision to enter into this Agreement and the other Loan Documents.
Each Lender also acknowledges that it will, independently and without reliance
upon the Agent or any other Lender and based on such documents and information
as it shall deem appropriate at the time, continue to make its own credit
decisions in taking or not taking action under this Agreement and the other Loan
Documents.

     11.11     SUCCESSOR AGENT. The Agent may resign at any time by giving
written notice thereof to the Lenders, the L/C Issuer and the Borrowers, such
resignation to be effective upon the appointment of a successor Agent or, if no
successor Agent has been appointed, 45 days after the resigning Agent gives
notice of its intention to resign. The Agent shall so resign if at any time it
ceases to be a Lender. Upon any such resignation the Required Lenders shall have
the right to appoint, on behalf of the Lenders, a successor Agent. If no
successor Agent shall have been so appointed by the Required Lenders within 30
days after the resigning Agent's giving notice of its intention to resign, then
the resigning Agent may appoint, on behalf of the Lenders, a successor Agent. If
the Agent has resigned and no successor Agent has been appointed, the Lenders
may perform all the duties of the Agent hereunder and the Borrowers shall make
all payments in respect of the Obligations to the applicable Lender (except for
payments required to be made directly to the L/C Issuer) and for all other
purposes shall deal directly with the Lenders and the L/C Issuer. No successor
Agent shall be deemed to be appointed hereunder until such successor Agent has
accepted the appointment. Any such successor Agent shall be a commercial bank
having capital and retained earnings of at least $500,000,000. Upon the
acceptance of any appointment as Agent hereunder by a successor Agent, such
successor Agent shall thereupon succeed to and become vested with all the
rights, powers, privileges and duties of the resigning Agent. Upon the
effectiveness of the resignation of the Agent, the resigning Agent shall be
discharged from its duties and obligations hereunder and under the Loan
Documents. After the effectiveness of the resignation of an Agent, the
provisions of this ARTICLE XI shall continue in effect for the benefit of such
Agent in respect of any actions taken or omitted to be taken by it while it was
acting as the Agent hereunder and under the other Loan Documents.

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     11.12     AGENT'S FEE. The Borrowers agree to pay to the Agent, for its own
account, the fees agreed to by the Borrowers and the Agent pursuant to the Fee
Letter, or as otherwise agreed from time to time.

                                   ARTICLE XII
                            SETOFF; RATABLE PAYMENTS

     12.1      SETOFF. In addition to, and without limitation of, any rights of
the Lenders and the L/C Issuer under applicable law and notwithstanding the
provisions of Section 362 of the Bankruptcy Code and without application of
motion to, or order from the U.S. Court, if any Default occurs, any and all
deposits (including all account balances, whether provisional or final and
whether or not collected or available) and any other Indebtedness at any time
held or owing by any Lender or the L/C Issuer to or for the credit or account of
TLGI or any Borrower may be offset and applied toward the payment of the
Obligations owing to such Lender or the L/C Issuer, whether or not the
Obligations, or any part hereof, shall then be due.

     12.2      RATABLE PAYMENTS. Lenders hereby agree among themselves that if
any of them shall, whether by voluntary payment (other than a voluntary
prepayment of Loans made and applied in accordance with the terms of this
Agreement), by realization upon security, through the exercise of any right of
set-off or banker's lien, by counterclaim or cross action or by the enforcement
of any right under the Loan Documents or otherwise, or as adequate protection of
a deposit treated as cash collateral under the Bankruptcy Code, receive payment
or reduction of a proportion of the aggregate amount of principal, interest,
amounts payable in respect of Letters of Credit, fees and other amounts then due
and owing to that Lender hereunder or under the other Loan Documents
(collectively, the "AGGREGATE AMOUNTS DUE" to such Lender) which is greater than
the proportion received by any other Lender in respect of the Aggregate Amounts
Due to such other Lender, then the Lender receiving such proportionately greater
payment shall (i) notify the Agent and each other Lender of the receipt of such
payment and (ii) apply a portion of such payment to purchase participations
(which it shall be deemed to have purchased from each seller of a participation
simultaneously upon the receipt by such seller of its portion of such payment)
in the Aggregate Amounts Due to the other Lenders so that all such recoveries of
Aggregate Amounts Due shall be shared by all Lenders in proportion to the
Aggregate Amounts Due to them; PROVIDED that if all or part of such
proportionately greater payment received by such purchasing Lender is thereafter
recovered from such Lender pursuant to an order of the U.S. Court or the
Canadian Court or otherwise, those purchases shall be rescinded and the purchase
prices paid for such participations shall be returned to such purchasing Lender
ratably to the extent of such recovery, but without interest. Each Borrower
expressly consents to the foregoing arrangement and agrees that any holder of a
participation so purchased may exercise any and all rights of banker's lien,
set-off or counterclaim with respect to any and all monies owing by such
Borrower to that holder with respect thereto as fully as if that holder were
owed the amount of the participation held by that holder.

                                  ARTICLE XIII
                BENEFIT OF AGREEMENT; ASSIGNMENTS; PARTICIPATIONS

     13.1      SUCCESSORS AND ASSIGNS. The terms and provisions of the Loan
Documents shall be binding upon and inure to the benefit of TLGI, the Borrowers,
the Agent, the L/C Issuer and the Lenders and their respective successors and
assigns, except that (a) neither TLGI nor any Borrower shall have the right to
assign its rights or obligations under the Loan Documents and (b) any assignment
by any Lender must be made in compliance with SECTION 13.3. Notwithstanding
CLAUSE (b) of the preceding sentence, any Lender may at any time, without the
consent of TLGI, the Borrowers, the Agent or the L/C Issuer, assign all or any
portion of its rights under this Agreement to a Federal Reserve Bank; PROVIDED,
HOWEVER, that no such assignment to a Federal Reserve Bank shall release the
transferor Lender from its obligations hereunder. In order to facilitate such
assignment, the Borrowers hereby agree that, upon request of any Lender at any

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time and from time to time after the Borrowers have made their initial borrowing
hereunder, the Borrowers shall provide to such Lender, at the Borrowers' own
expense, a promissory note, substantially in the form of EXHIBIT A hereto,
evidencing the Revolving Loans owing to such Lender. The Agent may treat the
payee of any Revolving Loan as the owner thereof for all purposes hereof unless
and until such payee complies with SECTION 13.3 in the case of an assignment
thereof or, in the case of any other transfer, a written notice of the transfer
is filed with the Agent. Any assignee or transferee of a Revolving Loans, a
participation in a Letter of Credit or a participation in a Reimbursement
Obligation agrees by acceptance thereof to be bound by all the terms and
provisions of the Loan Documents, and any request, authority or consent of any
Person, who at the time of making such request or giving such authority or
consent is the holder of any Revolving Loan, participation in a Letter of Credit
or participation in a Reimbursement Obligation, shall be conclusive and binding
on any subsequent holder, transferee or assignee of such Revolving Loan,
participation in a Letter of Credit or participation in a Reimbursement
Obligation.

     13.2      PARTICIPATIONS.

     13.2.1.   PERMITTED PARTICIPATIONS; EFFECT. Any Lender may, in the
ordinary course of its business and in accordance with applicable law, at any
time sell to one or more banks or other entities (each such bank or other
entity being referred to herein as a "PARTICIPANT") participating interests
in any Revolving Loan owing to such Lender, or L/C Interest held by such
Lender, the Commitment of such Lender or any other interest of such Lender
under the Loan Documents; PROVIDED, HOWEVER, that no Lender shall grant a
participating interest to any entity which is engaged in any business which
is competitive in any material respect with the business of TLGI, any
Borrower or any of the Subsidiaries of TLGI. In the event of any such sale by
a Lender of participating interests to a Participant, such Lender's
obligations under the Loan Documents shall remain unchanged, such Lender
shall remain solely responsible to the other parties hereto for the
performance of such obligations, such Lender shall remain the holder of any
such Revolving Loan or L/C Interest for all purposes under the Loan
Documents, all amounts payable by the Borrowers under this Agreement shall be
determined as if such Lender had not sold such participating interests and
TLGI, the Borrowers, the L/C Issuer and the Agent shall continue to deal
solely and directly with such Lender in connection with such Lender's rights
and obligations under the Loan Documents. The participation agreement
effecting the sale of any participating interest shall contain a
representation by the Participant to the effect that none of the
consideration used to make the purchase of the participating interest in the
Commitment, Revolving Loans and the L/C Interests under such participation
agreement are "plan assets" as defined under ERISA and that the rights and
interests of the Participant in and under the Loan Documents will not be
"plan assets" under ERISA.

     13.2.2    VOTING RIGHTS. Each Lender shall retain the sole right to
approve, without the consent of any Participant, any amendment, modification
or waiver of any provision of the Loan Documents other than any amendment,
modification or waiver with respect to any Revolving Loan, L/C Interest or
Commitment in which such Participant has an interest which forgives
principal, interest or fees or reduces the interest rate or fees payable with
respect to any such Revolving Loan, L/C Interest or Commitment, or postpones
any date fixed for any regularly scheduled payment of principal of, or
interest or fees on, any such Revolving Loan, L/C Interest or Commitment.

     13.2.3    SETOFF. Each Lender's right to exercise its right of setoff
provided in SECTION 12.1 shall not be reduced or impaired by any grant by
such Lender of a participating interest to a Participant.

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     13.3      ASSIGNMENTS.

     13.3.1    PERMITTED ASSIGNMENTS. Any Lender may, in the ordinary course
of its business and in accordance with applicable law, at any time assign to
one or more banks or other entities ("PURCHASERS") all or any part of its
Commitment and outstanding Revolving Loans, and L/C Interests, together with
its rights and obligations under the Loan Documents with respect thereto;
PROVIDED, HOWEVER, that (i) each such assignment shall be of a constant, and
not a varying, percentage of all of the assigning Lender's rights and
obligations so assigned; (ii) the amount of the Commitment of the assigning
Lender being assigned pursuant to each such assignment (determined as of the
date of such assignment) may be in the amount of such Lender's entire
Commitment but otherwise shall not be less than $5,000,000 or an integral
multiple of $1,000,000 in excess of that amount; and (iii) notwithstanding
the CLAUSE (ii), if the assignment is made to a Lender or an Affiliate of the
assigning Lender, the amount of the Commitment assigned shall not be less
than $1,000,000. Such assignment shall be substantially in the form of
EXHIBIT D hereto or in such other form as may be agreed to by the parties
thereto. The consent of the Company, the L/C Issuer and the Agent shall be
required prior to an assignment becoming effective with respect to a
Purchaser which is not a Lender; PROVIDED, HOWEVER, that if a Default has
occurred and is continuing, the consent of the Company shall not be required.
Such consents shall not be unreasonably withheld.

     13.3.2    EFFECT; EFFECTIVE DATE OF ASSIGNMENTS. Solely with respect to
assignments under SECTION 13.3.1, such assignments shall become effective on
the date (which shall be a Business Day) which is five Business Days
following the (a) delivery to the Agent of a notice of assignment,
substantially in the form attached to EXHIBIT E hereto (a "NOTICE OF
ASSIGNMENT"), together with any consents required by SECTION 13.1, and (b)
payment of a $3,500 fee to the Agent for processing such assignment. If any
such assignment is made as contemplated by the terms of SECTION 3.5 at the
request of the Borrowers, or is otherwise made at the request of the
Borrowers, the $3,500 fee shall be paid by the Borrowers. The Notice of
Assignment shall contain a representation by the Purchaser to the effect that
none of the consideration used to make the purchase of the Commitment,
Revolving Loans and L/C Interest under the applicable assignment agreement
are "plan assets" as defined under ERISA and that the rights and interests of
the Purchaser in and under the Loan Documents will not be "plan assets" under
ERISA. On and after the date such assignment becomes effective, such
Purchaser shall for all purposes be a Lender party to this Agreement and any
other Loan Document executed by or on behalf of the Lenders and shall have
all the rights and obligations of a Lender under the Loan Documents, to the
same extent as if it were an original party hereto and thereto, and the
transferor Lender shall be released with respect to the percentage of the
Aggregate Commitment, Revolving Loans and L/C Interest assigned to such
Purchaser without any further consent or action by TLGI, the Borrowers, the
Lenders, the L/C Issuer or the Agent being required. Upon the consummation of
any assignment to a Purchaser pursuant to

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this SECTION 13.3.2, the transferor Lender, the Agent and the Borrowers shall
make appropriate notations in their respective records to reflect the
principal amounts of the Commitments of the transferor Lender and the
Purchaser, as adjusted pursuant to such assignment. In connection with the
foregoing, the Agent shall maintain at its address referred to in SECTION
14.1 a copy of each Notice of Assignment delivered to it and a register (the
"REGISTER") for the recordation of the names and addresses of the Lenders and
the Commitments of such Lenders, the principal amount of each Type of
Revolving Loan owing to each such Lender from time to time. The entries in
the Register shall be conclusive, in the absence of clearly demonstrable
error, and TLGI, the Borrowers, the Agent and the Lenders may treat each
Person whose name is recorded in the Register as the owner of the Revolving
Loans recorded therein for all purposes of this Agreement. The Register shall
be available for inspection by TLGI, the Borrowers, or any Lender at any
reasonable time and from time to time upon reasonable prior notice. The Agent
shall give prompt written notice to the Borrowers of the making of any entry
in the Register or any change in any such entry.

     13.4      DISSEMINATION OF INFORMATION. Each of TLGI and each Borrower
authorizes each Lender to disclose to any Participant or Purchaser or any other
Person acquiring an interest in the Loan Documents by operation of law (each a
"TRANSFEREE") and any prospective Transferee any and all information in such
Lender's possession concerning the creditworthiness of TLGI and any Borrower and
the other Subsidiaries; provided that each Transferee and prospective Transferee
agrees to be bound by SECTION 10.15.

     13.5      TAX TREATMENT. If any interest in any Loan Document is
transferred to any Transferee which is organized under the laws of any
jurisdiction other than the United States or any State thereof, the transferor
Lender shall cause such Transferee, concurrently with the effectiveness of such
transfer, to comply with the provisions of SECTION 2.17.

                                   ARTICLE XIV
                                     NOTICES

     14.1      GIVING NOTICE. Except as otherwise permitted by SECTION 2.13(d)
with respect to Revolving Loans, all notices and other communications provided
to any party hereto under this Agreement or any other Loan Document shall be in
writing or by telex or by facsimile and addressed or delivered to such party at
its address set forth, in the case of the Agent or the Lenders, on Schedule 2.1
hereto, and in the case of the Company, the Borrowers or TLGI, to it or them at
4126 Norland Avenue, Burnaby, British Columbia, V5G 358, Canada or at such other
address as may be designated by such party in a notice to the other parties;
PROVIDED that notice to the Company which specifies that it is a notice to the
Borrowers shall constitute notice to the Borrowers hereunder. Any notice, if
mailed and properly addressed with postage prepaid, shall be deemed given when
received; any notice, if transmitted by telex or facsimile, shall be deemed
given when transmitted (answerback confirmed in the case of telexes).

     14.2      CHANGE OF ADDRESS. The Borrowers, TLGI, the Agent, the L/C Issuer
and any Lender may each change the address for service of notice upon it by a
notice in writing to the other parties hereto.

         [THE REMAINDER OF THIS PAGE HAS BEEN INTENTIONALLY LEFT BLANK]

                                       72
<PAGE>

     IN WITNESS WHEREOF, the Borrowers, TLGI, the Lenders, the L/C Issuer and
the Agent executed this Agreement as of the day and the year first above
written.

                                    LOEWEN GROUP INTERNATIONAL, INC.

                                    By:  _______________________________________
                                            Name:
                                            Title:

                                EACH OF THE ENTITIES LISTED ON SCHEDULE A HERETO

                                    By: ________________________________________
                                     on behalf of each of the entities listed on
                                     Schedule A hereto the Credit Agreement

                                        ________________________________________
                                            Name:
                                            Title:

                                    THE LOEWEN GROUP INC.

                                    By: ________________________________________
                                            Name:
                                            Title:

                                    FIRST UNION NATIONAL BANK,
                                    INDIVIDUALLY AND AS ADMINISTRATIVE AGENT

                                    By: ________________________________________
                                            Name:
                                            Title:

                                    BANK OF SCOTLAND

                                    By: ________________________________________
                                            Name:
                                            Title:

                                       73
<PAGE>

                                    THE CIT GROUP/BUSINESS CREDIT, INC.

                                    By: ________________________________________
                                            Name:
                                            Title:

                                    FOOTHILL CAPITAL CORPORATION

                                    By: ________________________________________
                                            Name:
                                            Title:

                                    GMAC BUSINESS CREDIT

                                    By: ________________________________________
                                            Name:
                                            Title:

                                    MELLON BANK, N.A.

                                    By: ________________________________________
                                            Name:
                                            Title:

                                    SOVEREIGN BANK

                                    By: ________________________________________
                                            Name:
                                            Title:

                                       74

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