Document:

EXHIBIT 10.65

 

 

 

 

 

 

 

 

TRADEMARK
LICENSE AGREEMENT

 

 

 

 

between

 

 

MRS.
FIELDS FRANCHISING, LLC

a
Delaware limited liability company

 

 

and

 

 

 

Shadewell Grove IP, LLC

a
Delaware limited liability company

 

 

 

 

 

DATED:  December 24, 2004

 

 

TABLE OF
CONTENTS

 

	
  RECITALS

   

  	
   

  	
   

  
	
  AGREEMENT

   

  	
   

  	
   

  
	
  1.

  	
  DEFINITIONS

   

  	
   

  
	
  2.

  	
  GRANT
  OF LICENSE

   

  	
   

  
	
  3.

  	
  RESERVATION OF RIGHTS

   

  	
   

  
	
  4.

  	
  LICENSE
  TRANSFER

   

  	
   

  
	
  5.

  	
  LICENSE FEE AND ROYALTIES

   

  	
   

  
	
  6.

  	
  GUARANTEED
  ROYALTY

   

  	
   

  
	
  7.

  	
  LICENSE
  RETENTION

   

  	
   

  
	
  8.

  	
  SHADEWELL
  REPORTS

   

  	
   

  
	
  9.

  	
  DEVELOPMENT
  OF ROYALTY BEARING PRODUCTS

   

  	
   

  
	
  10.

  	
  ADVERTISING
  AND PROMOTION REQUIREMENTS

   

  	
   

  
	
  11.

  	
  LABELING

   

  	
   

  
	
  12.

  	
  USE OF LICENSED
  NAMES AND MARKS

   

  	
   

  
	
  13.

  	
  INFRINGEMENT

   

  	
   

  
	
  14.

  	
  INSURANCE

   

  	
   

  
	
  15.

  	
  CONFIDENTIALITY

   

  	
   

  
	
  16.

  	
  TERM AND TERMINATION

   

  	
   

  
	
  17.

  	
  DISPOSAL OF
  INVENTORY UPON EXPIRATION

   

  	
   

  
	
  18.

  	
  FINAL
  STATEMENT UPON TERMINATION OR EXPIRATION

   

  	
   

  
	
  19.

  	
  REPRESENTATIONS AND
  WARRANTIES

   

  	
   

  
	
  20.

  	
  INDEMNIFICATION

   

  	
   

  
	
  21.

  	
  NOTICES

   

  	
   

  
	
  22.

  	
  GENERAL PROVISIONS

   

  	
   

  
	
  EXHIBIT “A”
  LICENSED NAMES AND MARKS

   

  	
   

  
	
  EXHIBIT “B” ROYALTY
  BEARING PRODUCTS

  	
   

  
				

 

ii

 

TRADEMARK LICENSE
AGREEMENT

 

THIS
TRADEMARK LICENSE AGREEMENT (the “Agreement”) is made and entered into this
24th  day of December, 2004 by and
between MRS. FIELDS FRANCHISING, LLC, a Delaware limited liability company (“MFF”), and Shadewell Grove IP, LLC, a Delaware limited
liability company (“Shadewell”).
MFF and Shadewell are sometimes collectively referred to herein as the
“parties.”

 

RECITALS

 

WHEREAS, MFF is an affiliate and licensee of The
Mrs. Fields’ Brand, Inc., the sole owner of certain trademarks, service marks,
and trade names, which have become associated with high quality food products,
and has the right under its license to sublicense such marks in the manner set
forth herein;

 

WHEREAS, Shadewell desires to acquire a license
from MFF to package, distribute and sell through designated distribution
channels pre-packaged, ready-to-eat shelf stable brownies and ready-to-eat
shelf stable dessert toppings and syrups, each utilizing the Mrs. Fields
trademarks, service marks and trade names, and MFF desires to grant Shadewell
such license upon and subject to the provisions of this Agreement;

 

 NOW THEREFORE,
in consideration of the covenants and agreements contained herein and other
valuable consideration, the receipt and sufficiency of which is hereby
acknowledged, the parties hereto agree as follows:

 

AGREEMENT

 

1.                                       DEFINITIONS

 

(a)                                  “Change of Control” shall mean (i) any merger or
consolidation of Shadewell with or into another corporation or entity, in which
the members of Shadewell immediately prior to the transaction collectively own
less than 50% of the voting power of the surviving entity immediately after the
transaction or (ii) the sale of all or substantially all of the interests in
Shadewell to a third party.

 

(b)                                 “Designated Distribution
Channels” shall
mean grocery stores, supermarkets, drug stores, convenience stores, club
stores, mass merchandisers and other similar retail prepackaged, shelf-stable
food and snack retail distribution channels.

 

(c)                                  “Initial Term” shall have the meaning set forth in
Section 16 hereof.

 

(d)                                 “Licensed Names and Marks” shall mean those trademarks, trade names
and service marks identified on Exhibit A hereto.

 

(e)                                  “Minimum Amount” shall mean (i) prior to a Change of
Control, $50,000 and (ii) after a Change of Control, $125,000, which amounts
shall be reduced by the amount of Running Royalties paid to MFF during the
applicable year.

 

3

 

(f)                                    “Minimum Net Sales” shall mean (i) prior to a Change of
Control, Net Sales of at least $1,000,000 and (ii) after a Change of Control,
Net Sales of at least $2,500,000.

 

(g)                                 “Net Sales” shall mean gross sales minus cash
discounts for early payments.

 

(h)                                 “Protected Information” shall mean Mrs. Fields recipes,
formulations, systems, programs, procedures, manuals, confidential reports and
communications, marketing techniques and arrangements, purchasing information,
pricing policies, quoting procedures, financial information, employee,
customer, supplier and distributor data, all of the materials or information
relating to the business or activities of MFF or its affiliates which were not
otherwise known to Shadewell prior to the commencement of the negotiations
leading to this Agreement, or generally known to others engaged in similar
businesses or activities, and all modifications, improvements and enhancements
which are derived from or relate to Shadewell’s access to or knowledge of any
of the above enumerated materials or information (whether or not any of the
above are reduced to writing or whether or not patentable or protectable by
copyright) which Shadewell receives, receives access to, conceives or develops
or has received, received access to, conceived or developed, in whole or in
part, directly or indirectly, in connection with Shadewell’s license
hereunder.  Information which is
independently developed by Shadewell, or which was already in the possession of
Shadewell prior to the date of this Agreement and which was not obtained in
connection with the transactions contemplated by this Agreement, or information
which is or becomes publicly available without breach of (i) this Agreement,
(ii) any other agreement or instrument to which Shadewell is a party or a
beneficiary, or (iii) any duty owed to MFF by Shadewell, shall not be
considered Protected Information hereunder.

 

(i)                                     “Royalty Bearing Product(s)” shall mean the food products described
on Exhibit B hereto using the Licensed Names and Marks.

 

(j)                                     “Royalty Default Rate” shall mean the interest rate which is
the lesser of (i) the annual rate from time to time publicly announced by
Citibank, N.A. at its “base rate” or “prime rate” (or any successor rate) plus
two percent (2%) or (ii) the highest applicable legal rate.

 

(k)                                  “Royalty
Waiver” shall have the meaning set forth in Section 5 hereof.

 

(l)                                     “Running Royalty” or “Running Royalties” shall mean the royalty or royalties from
time to time payable pursuant to Section 5.

 

(m)                               “Territory” shall mean United States, Mexico and
Canada.

 

 

4

 

2.          GRANT OF LICENSE

 

(a)           Grant. 
Subject to the terms and conditions of this Agreement, MFF hereby grants
to Shadewell, and Shadewell hereby accepts the grant by MFF of, the exclusive
right and license to use the Licensed Names and Marks to market Royalty Bearing
Products through Designated Distribution Channels throughout the
Territory.  Except as stated in Section
3, MFF shall not compete with Shadewell in the (i) use of any trademark,
service mark or tradename in marketing Royalty Bearing Products in Designated
Distribution Channels in the Territory or (ii) license any third party to use
the same in marketing any Royalty Bearing Products in Designated Distribution
Channels in the Territory.

 

(b)           First Right of Offer - Products. 
If at any time during the Initial Term and Option Periods MFF determines
to offer a license for the sale of a Brownie 
Product or a Topping Product marketed through the Designated
Distribution Channels for countries outside the Territory to a third party
manufacturer, licensee or marketing company, prior to offering the applicable
product marketed through the Designated Distribution Channels to a non-related
party by any means, MFF shall notify Shadewell and provide Shadewell a sixty
(60) day period of time thereafter during which MFF shall negotiate exclusively
in good faith with Shadewell for the license to sell the applicable products
through the Designated Distribution Channels, for countries outside the
Territory.  The terms and conditions upon
which MFF grants a license, if any, pursuant to this Section shall be as
negotiated by MFF and Shadewell during such 60 day period; provided, that MFF
is only free to reject Shadewell offer if an agreement cannot be reached as to
the Licensing Fee and the Running Royalty and after such rejection, MFF can
negotiate with any third party for the license to sell the applicable products
marketed through the Designated Distribution Channels for countries outside the
Territory and accept such third party offer only if it exceeds Shadewell’s best
offer.  Any agreement reached with
Shadewell during such 60-day period shall be documented in a separate agreement
or addendum to this Agreement and shall become effective only when signed by all
parties.

 

3.             RESERVATION OF RIGHTS

 

                MFF reserves all
rights with respect to the Licensed Names and Marks not expressly licensed to
Shadewell hereunder, and MFF may use or grant licenses to others to use the
Licensed Names and Marks in any other manner or in connection with any goods or
services, other than for sale of Royalty Bearing Products in Designated
Distribution Channels in the Territory. 
Without limiting the foregoing, the license granted pursuant to this Agreement
shall be exclusive to Shadewell except that MFF shall not be precluded from,
and hereby expressly retains the right to: 
(i) own, operate, and grant or license others the right to own and
operate Mrs. Fields Cookies stores which sell cookie, bakery and/or ice cream
products (whether or not such products are Royalty Bearing Products) under the
Licensed Names and Marks at locations within the Territory on such terms and
conditions, as MFF, in its sole discretion, deems appropriate, (ii) offer for
sale and sell, and license others to offer for sale and sell, any products or
services under the Licensed Names and Marks which are not Royalty Bearing
Products, and (iii) offer for sale and sell, and license others to offer for
sale and sell, any products or services under the Licensed Names and Marks,
whether or not such products are Royalty Bearing

 

5

 

Products, through all channels of distribution other than Designated
Distribution Channels, including without limitation, all e-commerce-based retail
or wholesale, television, mail order and catalog channels.  
Notwithstanding the foregoing, in the event that MFF decides to offer
Topping Products through television, MFF shall purchase from Shadewell all
Topping Products to be sold through television, such Topping Products to be
purchased at a “most favored nations” price. “Most favored nations” price for
the purpose of this agreement will be the lowest net price received by
Shadewell from any customer for the specific store keeping unit (“sku”) of the applicable
Topping Product during the 30 day period immediately preceding the order from
MFF, less an offset for the amount of the running royalty otherwise due from
Shadewell to MFF which will instead be credited against the purchase price
charged by Shadewell to MFF.

 

 

                4.             LICENSE
TRANSFER

 

This
Agreement shall be binding upon and inure to the benefit of the parties to this
Agreement and their successors or assigns; provided, that the rights of the
parties under this Agreement may only be assigned  (i) upon written consent by MFF or (ii)
without consent to a parent corporation which owns at least fifty-one percent
(51%) of such assigning party, a fifty-one percent (51%) owned subsidiary
corporation of such party, a fifty-one percent (51%) owned subsidiary of a
parent of such party if such parent owns at least fifty-one percent (51%) of
such party, or to such other business organization which shall acquire  substantially all of the assets and business
of the parties, a parent, or a subsidiary. Shadewell shall not have the right
to grant sublicenses under this Agreement. 
Any assignment, franchise, sublicense, or transfer, not expressly
permitted by this Section 4, is prohibited and will be deemed to be null and
void.

 

5.                                       LICENSE FEE AND ROYALTIES

 

(a)                                  Initial Licensing Fees.  Shadewell shall not be
required to pay an initial license fee in connection with this Agreement.

 

(b)                                 Running Royalties. 
Throughout the term (including Option Periods) of this Agreement, the
Running Royalty shall be 5% of Net Sales of Royalty Bearing Products for the
remainder of the term; provided, there shall be no Running Royalty during the
period commencing on the date of this Agreement and ending one year after the
first date that any Royalty Bearing Products are shipped by Shadewell to
customers (the “Royalty Waiver”).

 

(c)                                  Payments. 
Shadewell shall remit Running Royalties to MFF within 60 days following
the end of each calendar quarter covered by the Agreement.  Absent error in the calculation of any amounts
due hereunder, all Running Royalties shall be non refundable.  All fees, royalties, and amounts payable
hereunder shall be paid to MFF in U.S. currency in immediately available funds
at such address or to such account as shall be designated in writing by MFF.

 

(d)                                 Interest on Late Payments. 
Shadewell shall pay interest on all overdue

 

6

 

 amounts hereunder from the due date of such
amounts until paid at the Royalty Default Rate.

 

 

6.                                       NATIONAL LAUNCH AND SUPPORT

 

 

(a)                                  Prior to the end of calendar year 2006,
Shadewell agrees to launch the marketing and sale of each of the categories of
Royalty Bearing Products (Brownie Products or Topping Products) in at least one
of the Distribution Channels throughout the United States.

 

(b)                                 During each of the calendar years 2007,
2008 and 2009, Shadewell agrees to continue to provide material marketing and
sales support for the sale of each of the categories of Royalty Bearing
Products throughout the United States consistent with past practices.

 

(c)                                  In the event of a breach of the
obligations set forth in 6(a) or 6(b) above, MFF shall have the right, at their
election, to terminate the license granted herein with respect to that category
of Royalty Bearing Product that has failed to meet the above requirements.  The remedy set forth in this Section 6(c)
shall be the sole and exclusive remedy available to MFF in the event of a
breach of Section 6(a) or 6(b) above.

 

 

7.                                       INTENTIONALLY OMITTED

 

 

8.                                       SHADEWELL REPORTS

 

(a)           Periodic Reports.  On or before 60 days following the end of
each calendar quarter covered by this Agreement, Shadewell shall deliver to MFF
a written statement prepared, signed, and certified to be true and correct by
Shadewell’s senior financial officer, or their designee, setting forth the
amount of Royalty Bearing Products sold, including sufficient information and
detail to confirm the calculations, which report shall be accompanied by
payment in full of the amount of Running Royalties then due.

 

(b)           Annual Reports.  Within ninety (90) days following the end of
each calendar year of this Agreement, beginning with the first such year in
which Shadewell has sales of Royalty Bearing Products, Shadewell shall deliver
to MFF a written statement setting forth the amount of Royalty Bearing Products
sold and the calculations, including sufficient information and detail to
confirm the calculations, used to determine such amounts, which calculations
shall be signed and certified as true and correct by an independent certified
public accounting firm chosen by Shadewell and acceptable to MFF, which
acceptance shall not be withheld unreasonably. 
If this statement discloses that the amount of Running Royalties paid
during any period to which the report relates was less

 

7

 

than the amount
required to be paid or that any other amount is due MFF, Shadewell immediately
shall pay such amounts, together with accrued interest at the Royalty Default
Rate in cash or other immediately available funds. MFF shall have the right to
examine and audit the books and records of Shadewell to verify the amount of
Royalty Bearing Products sold.

 

 

9.             DEVELOPMENT OF ROYALTY
BEARING PRODUCTS

 

                Shadewell hereby covenants,
agrees, warrants and represents that:

 

(a)           Product Marketing.  All Royalty Bearing Products shall be
marketed and sold as “premium” products consistent with MFF’s then existing
image.  Shadewell accepts full
responsibility for and agrees to pay all costs it incurs associated with all
advertising and promotion, packaging design, graphics, and packaging materials
for Royalty Bearing Products.

 

 (b)          Customer Complaints. 
Shadewell shall provide MFF a summary of all written consumer complaints
received regarding the quality of the Royalty Bearing Products and shall maintain
all written consumer complaints and a telephone log for all consumer complaints
received by telephone for a period of one year. 
Shadewell will send a written report to MFF each month containing the
comments received, names of complaining persons, with addresses and telephone
numbers (if available).  Comments will be
organized and summarized by type of comment or complaint and by the
geographical location of the complaint. 
Such information will also be available for inspection by MFF during
normal working hours upon reasonable notice. 
Shadewell further agrees that it will respond to any written customer
complaint within ten (10) days of receipt of such complaint by written response
with either a refund of the customer’s money or a coupon for the same type of
Royalty Bearing Product purchased, depending upon the complaining customer’s
request.  Shadewell further agrees that
any complaints about MFF products which are not Royalty Bearing Products will
be forwarded to MFF within five (5) days of receipt.  MFF agrees that all customer complaints and
comments received by it with respect to Royalty Bearing Products will be
forwarded to Shadewell within five (5) days of receipt.  Shadewell shall further provide MFF with
copies of all responses to complaints, upon request.

 

10.           ADVERTISING AND PROMOTION
REQUIREMENTS

 

Shadewell shall
market Royalty Bearing Products as premium products or as is otherwise
consistent with MFF’s then existing image so that such marketing shall not
reflect adversely upon Royalty Bearing Products, the good name of MFF, or the
Licensed Names and Marks.  MFF shall have
a prior to use reasonable right of approval for all promotional, marketing and
advertising materials and concepts for each promotional campaign Shadewell uses
to market Royalty Bearing Products.  In
that regard, MFF shall have a reasonable right of approval, prior to

 

8

 

 the development of final television, radio or
printed advertisements, the final “story boards” with respect to television
advertising, the final “script” with respect to radio spots and the final
“layouts” with respect to printed advertisements.  MFF shall also have a reasonable right of
approval with respect to the actors or actresses used in connection with any
such advertising campaigns; provided, that Shadewell shall have the right to
make minor variations in promotional, marketing and advertising materials used
in connection with the approved promotional campaigns.  All advertisements and advertising campaigns
shall conform in all material respects to the approvals given by MFF.  MFF shall have five (5) business days
following the receipt of the proposed promotional, marketing or advertising
materials to send Shadewell written notice of its disapproval which shall
include an explanation of the basis for disapproval.  If such written disapproval is not received
by Shadewell within this five (5) business day period, the marketing,
promotional or advertising material submitted to MFF shall be deemed approved.  Any material modifications to any such
materials previously approved by MFF shall be subject to approval pursuant to
this Section 10.  Once a promotional
campaign has been approved by MFF, if no material changes are made to it by
Shadewell, MFF shall not rescind its approval and Shadewell may proceed
accordingly on the basis that it is approved.

 

11.                                 LABELING

 

Whenever Shadewell
uses the Licensed Names and Marks, Shadewell shall affix the appropriate
trademark notice and agrees to use the registration symbol of “R”  in connection with its use of the Licensed
Names and Marks, or “TM” where the mark has not been registered federally, and
in each instance where appropriate accompanied by the words “Reg. TM of MFF” or
a reasonable facsimile thereof or such other reference as may be designated by
MFF from time to time.  Where a Licensed
Name and Mark is used more than once on packaging, in copy or advertising or on
the Royalty Bearing Products, the “R” or “TM” designation need only be used
once either on the most prominent use of the Licensed Name and Mark, or if all
uses are of equal prominence, then on the first use of the Licensed Name and
Mark in or on each package, copy, advertisement, or product.  Shadewell shall use the Licensed Names and
Marks only as trademarks, service marks, or trade names and shall affix the
notice as specified.  Shadewell shall not
have the right, unless previously agreed in writing by MFF, to use other
trademarks, service marks, or trade names in marketing and promoting Royalty
Bearing Products.  MFF shall have the
right to own and register any such other trademark, service mark, or trade name
which is registerable, including a Licensed Name or Mark or “Fields” in any
format, and such trademarks, service marks, and trade names owned or registered
by MFF shall be included in the Licensed Names and Marks, and Shadewell shall
cooperate with MFF by providing packaging, labeling, and documentation as may
be required to obtain and maintain such registration.

 

12.                                 USE OF LICENSED NAMES AND MARKS

 

(a)           Restrictions On Use.  Unless MFF consents in writing, which consent
shall not be unreasonably withheld, Shadewell shall use the Licensed Names and
Marks:

 

(i)            only for the purposes of and
pursuant to this Agreement,

 

9

 

(ii)                                  only in a manner consistent with the
scope of the relevant registration of the Licensed Names and Marks or
applications therefor in the Territory,

 

(iii)                               only in the manner permitted and
prescribed by MFF as set forth herein,

 

(iv)                              only with respect to Royalty Bearing
Products, and

 

(v)                                 only to sell Royalty Bearing Products
through Designated Distribution Channels.

 

(b)                                 Recognition of Goodwill. 
Shadewell recognizes the value of the goodwill associated with the
Licensed Names and Marks and acknowledges that the Licensed Names and Marks and
all rights therein and goodwill pertaining thereto belong exclusively to MFF.

 

(c)                                  Validity of Other Agreements. 
Shadewell agrees that it will not, during the term of this Agreement or
thereafter, attack the title or any rights of MFF in and to the Licensed Names
and Marks, or any other license agreement or franchise agreement involving the
Licensed Names and Marks to which MFF is a party.

 

(d)                                 Validity of Licensed Names and
Marks.  Shadewell agrees that it will not
intentionally destroy, impair or in any way impede the effect and validity of
the Licensed Names and Marks.

 

(e)                                  Validity of the Other
Retail Agreements.  Nothing in this paragraph shall restrict
Shadewell’s rights under any other license agreements that it may have with
MFOC or its affiliates.

 

13.           INFRINGEMENT

 

Shadewell agrees
to assist MFF, at MFF’s cost and expense, to the extent necessary in the
procurement of any protection or to protect any of MFF’s rights to the Licensed
Names and Marks, and MFF, if it so desires, may commence or prosecute any
claims or suits in its  own name or, with
Shadewell’s consent, in the name of Shadewell or join Shadewell as a party
thereto.  Shadewell shall notify MFF in
writing of any infringements or imitations by others of the Licensed Names and
Marks which may come to Shadewell’s attention, and MFF shall have the sole
right to determine whether or not any action shall be taken on account of any
such infringements or imitations at MFF’s cost and expense.  Shadewell shall not institute any suit or
take any action on account of any such infringements or imitations without
first obtaining the written consent of MFF.

 

10

 

14.           INSURANCE

 

Shadewell shall
obtain and keep in force, at its sole expense, product liability insurance providing
adequate insurance for MFF against any claims and suits involving product
liability arising out of, or with respect to, the transactions contemplated by
this Agreement and the Retail Agreements, in no less than Ten million dollars
($10,000,000.00) combined single limit on bodily injuries and/or property
damage in the aggregate.  Within thirty
(30) days after the date of this Agreement, Shadewell shall submit to MFF a
certificate of insurance naming MFF as an additional insured and providing that
any cancellation or material change or alteration which reduces coverage or any
benefits accruing to MFF shall become effective only upon thirty (30) days
prior notice to MFF.  The requirements of
this Section 14 are acknowledged by Shadewell to be a material term of this
Agreement as defined in paragraph 16(b)(ii).

 

15.           CONFIDENTIALITY

 

(a)                                  Acknowledgment of Confidentiality. 
Shadewell understands that any Protected Information disclosed to it by
MFF under this Agreement is secret, proprietary and of great value to
Shadewell, which value may be impaired if the secrecy of the Protected
Information is not maintained.

 

(b)                                 Reasonable Security Measures. 
MFF has taken and will continue to take reasonable security measures to
preserve and protect the secrecy of the Protected Information and Shadewell
agrees to take all measures reasonably necessary to protect the secrecy of such
information in order to prevent it from falling into the public domain or into
the possession of persons not bound to maintain the secrecy of such
information.

 

(c)                                  Non-Disclosure Obligation. 
Shadewell agrees not to disclose the Protected Information obtained
pursuant to this Agreement, to any person or entity (other than Shadewell’s key
officers and employees to whom disclosure is necessary and to co-packers whom
have executed a Confidentiality Agreement pursuant to paragraph 4), during the
term of this Agreement or at any time following the expiration or termination of
this Agreement.

 

(d)                                 Burden of Proof. 
Shadewell hereby acknowledges and agrees that if Shadewell shall
disclose, divulge, reveal, report, publish, transfer or use, for any purpose
whatsoever, except as authorized herein, any Protected Information, and Shadewell
shall assert as a defense that such information (i) was already known to
Shadewell or developed prior to the execution of this Agreement, (ii) was
independently developed by Shadewell, (iii) was disclosed to third parties
without violation of this Agreement, (iv) was already in the public domain
prior to the execution of this Agreement, or (v) entered the public domain
without violation of this Agreement, then Shadewell shall bear the burden of
proof with respect to the same.

 

(e)                                  Mutuality of Obligations. 
MFF hereby agrees that any information which it receives from Shadewell
which is within the scope of the definition of Protected

 

11

 

Information, shall
be treated as confidential by MFF, and MFF hereby agrees to be bound by the
terms of this Agreement with respect to any such information it receives from
Shadewell, to the same extent that Shadewell is bound by the terms of this
Agreement with respect to Protected Information, as set forth above in paragraphs
15(a), (b), (c) and (d).

 

 

16.           TERM AND TERMINATION

 

(a)           Term.  The initial term of this Agreement shall
begin upon the execution hereof and shall continue for a period of sixty months
(“Initial Term”).  So long as Shadewell is not in material default,
this Agreement would then automatically renew for successive five year terms
(“Option Periods”) or until such time as either party provides a written notice
of non-renewal to the other party no more than 90 days and no less than twenty
(20) days before the conclusion of an Option Period.   Notwithstanding the above, if during the
fifth year of the Initial Term Shadewell has achieved Minimum Net Sales of
Brownie Products or paid the Minimum Amount for the Brownie Products, then MFF
shall not exercise its non-renewal rights under this paragraph 16(a) with
respect to the Brownie Products. 
Notwithstanding the above, if during the fifth year of the Initial Term
Shadewell has achieved Minimum Net Sales of Topping Products or paid the
Minimum Amount for the Topping Products, then MFF shall not exercise its
non-renewal rights under this paragraph 16(a) with respect to the Topping
Products.  Notwithstanding the above, if
during the fifth year of an Option Period (after the initial Option Period)
Shadewell has achieved or paid a minimum of a 2% growth of Running Royalties
for the Brownie Products as compared to the Running Royalties for the Brownie
Products for the fourth year of such Option Period, then MFF shall not exercise
its non-renewal rights under this paragraph 16(a) with respect to the Brownie
Products.    Notwithstanding the above,
if during the fifth year of an Option Period (after the initial Option Period)
Shadewell has achieved or paid a minimum of a 2% growth of Running Royalties
for the Topping Products as compared to the Running Royalties for the Topping
Products for the fourth year of such Option Period, then MFF shall not exercise
its non-renewal rights under this paragraph 16(a) with respect to the Topping
Products.  In the event that this Agreement
is not renewed with respect to the Brownie Products or the Topping Products, as
applicable, this Agreement shall remain in full force and effect with respect
to the other Royalty Bearing Products until terminated in accordance with this
Section 16. MFF’s termination rights under paragraph 16(b) shall not be deemed altered or waived by this
paragraph 16(a).

 

(b)           Termination.  This Agreement may be terminated as follows:

 

(i)            If Shadewell defaults in the payment
of any Running Royalties then this Agreement and the license granted hereunder
may be terminated upon notice by MFF effective thirty (30) days after receipt
of such notice, without prejudice to any and all other rights and remedies MFF
may have hereunder or by

 

12

 

law provided, and
all rights of Shadewell hereunder shall cease, provided that Shadewell has not
cured such default within five (5) days of receipt of such notice.

 

(ii)           If Shadewell fails to perform in
accordance with any material term or condition of this Agreement (other than as
described in paragraph 16(b)(i) above) and such default continues unremedied
for thirty (30) days after the date on which Shadewell receives written notice
of default, unless such remedy cannot be accomplished in such time period and
Shadewell has commenced diligent efforts within such time period and continues
such effort until the remedy is complete, then this Agreement may be terminated
upon notice by MFF, effective upon receipt of such notice, without prejudice to
any and all other rights and remedies MFF may have hereunder or by law
provided.

 

(iii)          If Shadewell is determined to be
insolvent, or files a petition in bankruptcy or for reorganization, or takes
advantage of any insolvency statute, or makes an assignment for the benefit of
creditors, or undertakes any similar action, under any federal, state or
foreign bankruptcy, insolvency or similar law, unless such is dismissed,
removed or otherwise cured within thirty (30) days or unless Shadewell has
filed for Chapter 11 Reorganization protection under Federal Bankruptcy Laws,
then this Agreement and the License granted hereunder may be terminated upon
notice by MFF, effective upon receipt of such notice, without prejudice to any
and all other rights and remedies MFF may have hereunder or by law provided,
and the license herein granted shall not constitute an asset in reorganization,
bankruptcy, or insolvency which may be assigned or which may accrue to any
court or creditor appointed referee, receiver, or committee.

 

(iv)          If MFF is determined to be insolvent,
or files a petition in bankruptcy or for reorganization, or takes advantage of
any insolvency statute, or makes an assignment for the benefit of creditors, or
undertakes any similar action, under any federal, state or foreign bankruptcy,
insolvency or similar law, or fails to perform in accordance with any material
term or condition of this Agreement and such default continues for thirty (30)
days after MFF receives written notice of default, then this Agreement and the
License granted hereunder may be terminated upon notice by Shadewell, effective
upon receipt of such notice, without prejudice to any and all other rights and
remedies Shadewell may have hereunder or by law provided, and the license
herein granted shall not constitute an asset in reorganization, bankruptcy, or
insolvency which may be assigned or which may accrue to any court or creditor
appointed referee, receiver, or committee.

 

(v)           If MFF fails to perform in accordance
with any material term or condition of this Agreement and such default
continues unremedied for thirty (30) days after the date on which MFF receives
written notice of default, then this Agreement may be terminated upon notice by
Shadewell, effective upon receipt

 

13

 

of such notice,
without prejudice to any and all other rights and remedies Shadewell may have
hereunder or by law provided.

 

(c)           Rights Upon Termination or
Cancellation.  On any
cancellation, termination or expiration of this Agreement;

 

(i)            Shadewell agrees to immediately pay
to MFF all currently owed Running Royalties and any additional royalties
pursuant to Section 17 and to return all Protected Information, confidential
documents and other material supplied by MFF to Shadewell and agrees never to
use, disclose to others, nor assist others in using the Protected Information.

 

(ii)           Shadewell will be deemed to have
automatically and irrevocably assigned, transferred, and conveyed to MFF any
rights, equities, good will, titles or other rights in and to the Licensed
Names and Marks and Royalty Bearing Products which may have been obtained by
Shadewell or which may have vested in Shadewell in pursuance of any endeavors
covered hereby, and Shadewell will execute any instruments requested by MFF to
accomplish or confirm the foregoing.  Any
such assignment, transfer or conveyance shall be without consideration other
than the mutual covenants and considerations of this Agreement.

 

(iii)          Except as provided in Section 17
below, Shadewell further agrees that it shall forthwith discontinue the use of
all Licensed Names and Marks, including packaging and other paper goods and
other objects bearing any Licensed Names and Marks.

 

(d)           Licensing of Licensed
Names and Marks After Termination. 
Upon any expiration or earlier termination of this Agreement, MFF may
license others to use the Licensed Names and Marks to produce, sell, market and
advertise products similar or identical to the Royalty Bearing Products through
Designated Distribution Channels in the Territory.

 

17.           DISPOSAL OF INVENTORY UPON
EXPIRATION

 

For a period of
six (6) months following the termination or expiration of this Agreement,
Shadewell shall have the right to sell any Royalty Bearing Products in
Shadewell’s inventory. Any sales of Royalty Bearing Products under this Section
shall be, at all times, in accordance with the policies, prices, and standards
established for marketing and distribution of Royalty Bearing Products pursuant
to this Agreement, and shall include payment of all Running Royalties accrued
in accordance with Section 5 hereof.

 

 

14

 

18.           FINAL STATEMENT UPON
TERMINATION OR EXPIRATION

 

As soon as
practicable after termination or expiration of the license granted hereunder,
but in no event more than thirty (30) days thereafter, Shadewell shall deliver
to MFF a statement indicating the number and description of Royalty Bearing
Products packaged in packaging using the Licensed Names and Marks then in
Shadewell’s inventory.  MFF shall have
the option to conduct a physical inventory to ascertain or verify such
statement.

 

19.           REPRESENTATIONS AND
WARRANTIES

 

(a)                                  Title. 
MFF represents and warrants and Shadewell acknowledges that MFF has
represented that MFF is the owner of all right, title, and interest in and to
the Licensed Names and Marks and that such licensing and Licensed Names and
Marks under this Agreement to Shadewell does not infringe upon the rights of
any third parties.  Shadewell further
acknowledges the good will associated with the Licensed Names and Marks and
that such Licensed Names and Marks have acquired secondary meaning in the mind
of the public.  Shadewell shall not
during the term of this Agreement dispute or contest, directly or indirectly,
or due or cause to be done, any action which in any way contests, impairs, or
tends to impair MFF’s exclusive rights and title to the Licensed Names and
Marks or the validity of any registrations thereof and Shadewell shall not
assist others in so doing.  Shadewell
shall not in any manner represent that it owns any rights in the Licensed Names
and Marks (and/or registrations therefore), but may, only during the term of
this Agreement, and only if Shadewell has complied with all laws, regulations
and registration requirements within the jurisdiction for so doing, represent
that it is a “licensee” or “official licensee” hereunder.  Shadewell shall not register or attempt to
register in its own name, or that of any third party, any Licensed Name or
Mark.  Subject to the terms and
conditions of this Agreement, Shadewell agrees that any and all uses by
Shadewell of the Licensed Names and Marks under this Agreement shall be on
behalf of and accrue and inure to the benefit of MFF.  MFF will maintain at its sole expense, the
proper registration of all Licensed Names and Marks used under this Agreement.

 

(b)                                 Right To Enter Into This
Agreement.  MFF and Shadewell each warrant and represent
for itself that it has the right to enter into this Agreement, that it will not
knowingly subsequently take any action contrary to this Agreement, and that the
entering into of this Agreement will not knowingly violate any other agreement
to which it is a party or conflict with or violate any law, rule or regulation
by which it is bound.

 

(c)                                  MFF’s Image. 
MFF represents and warrants that it will not intentionally do anything
to destroy or impair its existing image.

 

(d)                                 Compliance with Laws. 
MFF represents and warrants the Royalty Bearing Products will be
manufactured in compliance with, and will not be adulterated or misbranded
within the meaning of, the Federal Food, Drug and Cosmetic Act of 1938, or any
other federal, state, foreign or local laws or regulations applicable thereto,
will not constitute an article which may not be introduced into interstate
commerce and will be

 

15

 

manufactured in
substantial compliance with all applicable federal, state, foreign or local
laws and regulations applicable thereto. 
MFF agrees to notify Shadewell promptly of any regulatory action of
which MFF has knowledge that is taken in relation to it by any federal, state,
foreign, country or municipal authority which relates to or affects the
manufacture, storage, distribution or sale of the Royalty Bearing Products.

 

20.           INDEMNIFICATION

 

(a)                                  MFF Indemnification. 
MFF hereby indemnifies Shadewell and forever holds Shadewell harmless
from and against all claims, suits, actions, proceedings, damages, losses or
liabilities, costs or expenses (including reasonable attorneys’ fees and
expenses) arising out of, based upon, or in connection with (i) any breach of
any of MFF’s warranties or representations as set forth in this Agreement or
(ii) any claim that the use by Shadewell of the Licensed Names and Marks as provided
in this Agreement infringes upon any franchise agreement, third party
trademark, service mark, or trade name.

 

(b)                                 Shadewell Indemnification. 
Shadewell hereby indemnifies MFF and forever holds MFF harmless from and
against all claims, suits, actions, proceedings, damages, losses or
liabilities, costs or expenses (including reasonable attorneys’ fees and
expenses) arising out of, based upon, or in connection with, unless it is at
the direction of MFF (i) any breach of any of Shadewell’s warranties or representations
as set forth in this Agreement, (ii) any alleged defects inherent in the
distribution or sale of Royalty Bearing Products;(iii)any injuries or damages
to purchasers, users, or consumers of Royalty Bearing Products arising from or
related to the use or consumption of Royalty Bearing Products; (iv) any
injuries or damages arising from Shadewell or any of Shadewell’s customers,
advertising, marketing or promotion of the Licensed Names and Marks or Royalty
Bearing Products; or (v) any alleged infringement or injuries of any third
party’s copyright, patent, or trademark unless and to the extent (with respect
to (iv) and (v) above) such alleged infringement is based upon Shadewell’s use
of the Licensed Names and Marks as authorized in this Agreement.

 

(c)                                  Conditions of Indemnification. 
As a condition of indemnification under this Section 20, the party
seeking indemnification shall give the other party (for purposes of this
Section 20 called the “Indemnifying Party”)
immediate notice of and copies of all pleadings and correspondence related to
the assertion of any such claim, proceeding, action, or suit and agrees not to
settle, compromise, or otherwise dispose of any such claim, proceeding, action
or suit without the prior written consent of the Indemnifying Party.  The Indemnifying Party shall have the right
(but not the obligation) to assume the defense or settlement of any such claim,
proceeding, action, or suit at its expense, by counsel of its choice.  Except for the settlement of a claim which involves
the payment of money only and for which the party seeking indemnification is
wholly indemnified by the Indemnifying Party, no claim may be settled by the
Indemnifying Party without the written consent of the party seeking
indemnification such consent not to be unreasonably withheld.  If the Indemnifying Party assumes such
defense, the Party seeking indemnity shall cooperate fully with the
Indemnifying Party in defense of the action and the

 

16

 

Indemnifying Party
shall not be liable to pay or reimburse the other party for attorneys’ fees or
expenses, except such out-of-pocket costs or expenses incurred by the
Indemnified Party in cooperating with the Indemnifying Party.

 

21.           NOTICES

 

All notices provided
by this Agreement shall be in writing and shall be given by facsimile or
registered mail, postage prepaid, or by personal delivery, by one party to the
other, addressed to such other Party at the applicable address set forth below,
or to such other addresses as may be given for such purpose by such other party
by notice duly given hereunder.  Notice
shall be deemed properly given on the date of a confirmed facsimile
transmission, three (3) days after the date mailed if given by first class mail
or on the date of delivery, which ever applies:

 

	
  To MFF:

  	
   

  	
  Mrs. Fields
  Franchising, LLC

  
	
   

  	
   

  	
  2855 E. Cottonwood
  Parkway, Suite 400

  
	
   

  	
   

  	
  Salt Lake City, UT
  84121

  
	
   

  	
   

  	
  Attention: General
  Counsel

  
	
   

  	
   

  	
  Fax No: (801) 736-5944

  
	
   

  	
   

  	
   

  
	
  To Shadewell:

  	
   

  	
  Shadewell Grove IP, LLC

  
	
   

  	
   

  	
  100 West 5th

  
	
   

  	
   

  	
  Suite 700

  
	
   

  	
   

  	
  Tulsa, OK 74103

  

 

 

 

22.           GENERAL PROVISIONS

 

(a)           No Fiduciary or Other
Relationship.  It is
understood and agreed by the parties hereto that this Agreement does not create
a fiduciary relationship between them, that MFF and Shadewell are and shall be
independent contractors and that nothing in this Agreement is intended to make
either party a general or special agent, joint venturer, partner or employee of
the other for any purpose whatsoever.

 

(b)           Use of Licensed Names and
Marks in Contracts.  Shadewell
shall not employ any of the Licensed Names and Marks in signing any contract or
applying for any license or permit or in a manner that may result in MFF’s
liability for any of Shadewell’s indebtedness or obligations, nor may Shadewell
use the Licensed Names and Marks in any way not expressly authorized by
MFF.  Except as expressly authorized in
writing, neither MFF nor Shadewell shall make any express or implied
agreements, warranties, guarantees or representations or incur any debt in the
name or on behalf of the other, represent that their relationship is other than
licensor and licensee or be obligated by or have any liability under any
agreements or representations made by the other that are not expressly
authorized in writing.

 

17

 

(c)           Severability.  Except as expressly provided to the contrary
herein, each Section, paragraph, term and provision of this Agreement, and any
portion thereof, shall be considered severable and if, for any reason, any such
provision of this Agreement is held to be invalid, contrary to or in conflict
with any applicable present or future law or regulation in a final,
unappealable ruling issued by any court, agency or tribunal with competent
jurisdiction in a proceeding to which MFF is a party, that ruling shall not
impair the operation of, or have any other effect upon, such other portions of
this Agreement as may remain otherwise intelligible, which shall continue to be
given full force and effect and bind the parties hereto, although any portion
held to be invalid shall be deemed not to be a part of this Agreement from the
date the time for appeal expires, if Shadewell is a party thereto, otherwise
upon Shadewell’s receipt of a notice of non-enforcement thereof from MFF.  If any covenant herein which restricts
competitive activity is deemed unenforceable by virtue of its scope in terms of
area, business activity prohibited and/or length of time, but would be
enforceable by reducing any part or all thereof, Shadewell and MFF agree that
the same shall be enforced to the fullest extent permissible under the laws and
public policies applied in the jurisdiction in which enforcement is sought.

 

(d)           Substitution of Provisions.  If any applicable and binding law or rule of
any jurisdiction requires a greater prior notice of the termination of this
Agreement than is required hereunder, or the taking of some other action not
required hereunder, or if, under any applicable and binding law or rule of any
jurisdiction, any provision of this Agreement is invalid or unenforceable, the
prior notice and/or other action required by such law or rule shall be
substituted for the comparable provisions hereof.  Shadewell agrees to be bound by any promise
or covenant imposing the maximum duty permitted by law which is subsumed within
the terms of any provision hereof, as though it were separately articulated in
and made a part of this Agreement, that may result from striking from any of
the provisions hereof, any portion or portions which a court may hold to be
unenforceable in a final decision to which MFF is a party, or from reducing the
scope of any promise or covenant to the extent required to comply with such a
court order.  Such modifications to this
Agreement shall be effective only in such jurisdiction, unless MFF elects to
give them greater applicability, and shall be enforced as originally made and
entered into in all other jurisdictions.

 

(e)           Waiver.  MFF and Shadewell may by written instrument
unilaterally waive or reduce any obligation of or restriction upon the other
under this Agreement, effective upon delivery of written notice thereof to the
other or such other effective date stated in the notice of waiver.  Any waiver so granted by the waiving party
shall be without prejudice to any other rights the waiving party may have, will
be subject to continuing review by the waiving party and may be revoked, in the
waiving party’s sole discretion, at any time and for any reason, effective upon
delivery to the other party of ten (10) days’ prior written notice.

 

(f)            Waiver by Custom or
Practice.  MFF and Shadewell
shall not be deemed to have waived or impaired any right, power or option
reserved by this Agreement (including, without limitation, the right to demand
exact compliance with

 

18

 

every term,
condition and covenant herein or to declare any breach thereof to be a default
and to terminate this Agreement prior to the expiration of its term) by virtue
of any custom or practice of the parties at variance with the terms hereof; any
failure, refusal or neglect of MFF or Shadewell to exercise any right under
this Agreement or to insist upon exact compliance by the other with its
obligations hereunder; any waiver, forbearance, delay, failure or omission by
MFF or Shadewell to exercise any right, power or option, whether of the same,
similar or different nature, or MFF’s acceptance of any payments due from
Shadewell after any breach of this Agreement.

 

(g)           Force Majeure.  Neither MFF nor Shadewell shall be liable for
loss or damage or deemed to be in breach of this Agreement if their failure to
perform obligations results from:

 

(i)                                     compliance with any law, regulation,
requirement or instruction of any federal, state, municipal or foreign government
or any department or agency thereof; or

 

(ii)                                  acts of God; or

 

(iii)                               fires, strikes, embargoes, war or riot;
or

 

(iv)                              any other similar event or cause.

 

Any delay
resulting from any of said causes shall extend performance accordingly or
excuse performance, in whole or in part, as may be reasonable, except that said
causes shall not excuse payments of amounts owed at the time of such occurrence
or payment of any Running Royalties for Royalty Bearing Products due on any
sales thereafter.

 

(h)           Press Release.  Unless consented to by either party in
advance or as required by law, regulation, statute, etc., both parties agree
not to issue any formal press release prior to the introduction of Royalty
Bearing Products through the Designated Distribution Channels.

 

(i)            Temporary Restraining
Orders.  Notwithstanding
anything to the contrary contained in this Agreement, MFF and Shadewell shall
each have the right in a proper case to obtain temporary restraining orders and
temporary or preliminary injunctive relief from a court of competent
jurisdiction.

 

(j)            Rights Cumulative.  The rights of MFF and Shadewell hereunder are
cumulative and no exercise or enforcement by MFF or Shadewell of any right or
remedy hereunder shall preclude the exercise or enforcement by MFF or Shadewell
of any other right or remedy hereunder which MFF or Shadewell is entitled by
law to enforce.

 

(k)           Costs and Attorney Fees.  If a claim for amounts owed by Shadewell to

 

19

 

MFF or its
affiliates is asserted in any judicial proceeding or appeal thereof, or if MFF
or Shadewell is required to enforce this Agreement in any judicial proceeding
or appeal thereof, the party prevailing in such proceeding shall be entitled to
reimbursement of its reasonable costs and expenses, including reasonable
accounting and legal fees, whether incurred prior to, in preparation for, or in
contemplation of the filing of any written demand, claim, action, hearing or
proceeding to enforce the obligations of this Agreement.  If MFF incurs expenses in connection with
Shadewell’s failure to pay when due amounts owing to MFF, to submit when due
any reports, information or supporting records or otherwise to comply with this
Agreement, or if Shadewell incurs expenses in connection with MFF’s failure to
comply with this Agreement, including, but not limited to legal and accounting
fees, the party incurring the expense shall be reimbursed by the other party
for any such reasonable costs and expenses which it incurs.

 

(l)            Governing Law.  Except to the extent governed by the United
States Trademark Act of 1946 (Lanham Act, 15 U.S.C. ‘‘ 1051 et seq.) or other federal law, this Agreement, and the
relationship between Shadewell and MFF, shall be governed by the laws of the
State of Utah.

 

(m)          Jurisdiction.  Shadewell and MFF hereby irrevocably consent
and agree that any legal action, suit or proceeding arising out of or in any
way in connection with this Agreement may be instituted or brought in the
United States District Court for the District of Utah. Shadewell and MFF hereby
irrevocably consent and submit to, for themselves and in respect of their
property, generally and unconditionally, the jurisdiction of such Court, and to
all proceedings in such Court.  Further,
Shadewell and MFF irrevocably consent to actual receipt of any summons and/or
legal process at their respective addresses as set forth in this Agreement as
constituting in every respect sufficient and effective service of process in
any such legal action or proceeding. 
Shadewell and MFF further agree that final judgment in any such legal
action, suit or proceeding shall be conclusive and may be enforced in any other
jurisdiction, whether within or outside the United States of America, by suit
under judgment, a certified or exemplified copy of which will be conclusive
evidence of the fact and the amount of the liability.

 

(n)           Waiver of Punitive Damages.  Except with respect to the indemnification
obligations of the parties hereunder, the parties waive to the fullest extent
permitted by law any right to or claim for any punitive or exemplary damages
against the other and agree that, in the event of a dispute between them, the
party making a claim shall be limited to recovery of any actual damages it
sustains.

 

(o)           Headings.  The headings of the several sections and
paragraphs hereof are for convenience only and do not define, limit or construe
the contents of such sections or paragraphs.

 

(p)           Entire Agreement.  This Agreement and the Exhibits hereto
represent the

 

20

 

entire agreement
between MFF and Shadewell with respect to the subject matter hereof and
supersede any prior agreements and negotiations between the parties.  This Agreement does not affect my rights or
obligations of the parties under the Retail Agreement.

 

(q)           Exhibits.  All Exhibits hereto form part of this
Agreement.

 

(r)            Counterparts.  This Agreement may be executed simultaneously
in two counterparts, each of which shall be deemed an original, but both of
which together shall constitute one and the same agreement, binding upon both
parties hereto, notwithstanding that both parties are not signatories to the
original or the same counterpart.

 

(s)           Expenses.  Each party shall bear its own expenses
(including attorneys’ fees and expenses) in connection with the preparation,
negotiation, execution, and delivery of this Agreement.

 

21

 

IN
WITNESS THEREOF,
this Agreement has been executed by the Parties hereto as of the date and year
first written above.

 

 

	
   

  	
  SHADEWELL GROVE IP, LLC

  
	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ Tim Bruer

  	
   

  
	
   

  	
   

  	
  Tim Bruer

  
	
   

  	
  Its:

  	
  President

  
	
   

  	
   

  	
   

  
	
   

  	
  MRS. FIELDS
  FRANCHISING, LLC

  
	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ Michael Ward

  	
   

  
	
   

  	
   

  	
  Michael Ward

  
	
   

  	
  Its:

  	
  Executive Vice
  President, General Counsel

  

 

22

 

EXHIBIT “A”

 

LICENSED
NAMES AND MARKS

 

 

Mrs. Fields

 

 

EXHIBIT “B”

 

ROYALTY
BEARING PRODUCTS

 

 

“Brownie
Products”:

 

1.  Shelf stable ready-to-eat brownies packaged
for retail sale.

 

 

“Topping
Products”:

 

1.  Shelf stable ready-to-eat dessert toppings
packaged for retail sale.

 

2.  Shelf stable ready-to-eat syrups packaged for
retail sale.Exhibit 4.1

 

EXECUTION VERSION

 

 

 

INDENTURE

Dated as of March 18, 2005

Between

AEP INDUSTRIES INC.,

and

THE BANK OF NEW YORK, Trustee

 

 

$175,000,000

7.875% Senior Notes due 2013

 

 

 

 

CROSS-REFERENCE TABLE

 

	
  Trust Indenture Act Section

  	
   

  	
   

  	
  Indenture Section

  
	
   

  	
   

  	
   

  	
   

  
	
  Section 310(a)(1)

  	
   

  	
  7.10

  
	
  (a)(2)

  	
   

  	
  7.10

  
	
  (a)(3)

  	
   

  	
  N.A.

  
	
  (a)(4)

  	
   

  	
  N.A.

  
	
  (a)(5)

  	
   

  	
  7.10

  
	
  (b)

  	
   

  	
  7.08; 7.10; 13.02

  
	
  (c)

  	
   

  	
  N.A.

  
	
  Section 311(a)

  	
   

  	
  7.11

  
	
  (b)

  	
   

  	
  7.11

  
	
  (c)

  	
   

  	
  N.A.

  
	
  Section 312(a)

  	
   

  	
  2.05

  
	
  (b)

  	
   

  	
  13.03

  
	
  (c)

  	
   

  	
  13.03

  
	
  Section 313(a)

  	
   

  	
  7.06

  
	
  (b)(1)

  	
   

  	
  N.A.

  
	
  (b)(2)

  	
   

  	
  7.06

  
	
  (c)

  	
   

  	
  7.06; 13.02

  
	
  (d)

  	
   

  	
  7.06

  
	
  Section 314(a)

  	
   

  	
  4.11; 4.12; 13.02

  
	
  (b)

  	
   

  	
  N.A.

  
	
  (c)(1)

  	
   

  	
  13.04

  
	
  (c)(2)

  	
   

  	
  13.04

  
	
  (c)(3)

  	
   

  	
  N.A.

  
	
  (d)

  	
   

  	
  N.A.

  
	
  (e)

  	
   

  	
  13.05

  
	
  (f)

  	
   

  	
  N.A.

  
	
  Section 315(a)

  	
   

  	
  7.01

  
	
  (b)

  	
   

  	
  7.05; 13.02

  
	
  (c)

  	
   

  	
  7.01(a)

  
	
  (d)

  	
   

  	
  7.01(c)

  
	
  (e)

  	
   

  	
  6.11

  
	
  Section 316(a)(last sentence)

  	
   

  	
  2.09

  
	
  (a)(1)(A)

  	
   

  	
  6.05

  
	
  (a)(1)(B)

  	
   

  	
  6.04

  
	
  (a)(2)

  	
   

  	
  N.A.

  
	
  (b)

  	
   

  	
  6.07

  
	
  (c)

  	
   

  	
  10.04

  
	
  Section 317(a)(1)

  	
   

  	
  6.08

  
	
  (a)(2)

  	
   

  	
  6.09

  
	
  (b)

  	
   

  	
  2.04

  
	
  Section 318(a)

  	
   

  	
  13.01

  

 

N.A. means Not
Applicable.

 

 

NOTE:            This Cross-Reference
Table shall not, for any purpose, be deemed to be a part of this Indenture.

 

 

TABLE OF CONTENTS

 

	
  ARTICLE ONE

  	
   

  
	
   

  	
   

  	
   

  
	
  DEFINITIONS
  AND INCORPORATION BY REFERENCE

  	
   

  
	
   

  	
   

  
	
  SECTION 1.01.

  	
  Definitions

  	
   

  
	
  SECTION 1.02.

  	
  Other Definitions

  	
   

  
	
  SECTION 1.03.

  	
  Incorporation by Reference of Trust
  Indenture Act

  	
   

  
	
  SECTION 1.04.

  	
  Rules of Construction

  	
   

  
	
   

  	
   

  	
   

  
	
  ARTICLE TWO

  	
   

  
	
   

  	
   

  	
   

  
	
  THE SECURITIES

  	
   

  
	
   

  	
   

  
	
  SECTION 2.01.

  	
  Form and Dating

  	
   

  
	
  SECTION 2.02.

  	
  Execution and Authentication

  	
   

  
	
  SECTION 2.03.

  	
  Registrar and Paying Agent

  	
   

  
	
  SECTION 2.04.

  	
  Paying Agent to Hold Money in Trust

  	
   

  
	
  SECTION 2.05.

  	
  Securityholder Lists

  	
   

  
	
  SECTION 2.06.

  	
  Transfer and Exchange

  	
   

  
	
  SECTION 2.07.

  	
  Replacement Securities

  	
   

  
	
  SECTION 2.08.

  	
  Outstanding Securities

  	
   

  
	
  SECTION 2.09.

  	
  Treasury Securities

  	
   

  
	
  SECTION 2.10.

  	
  Temporary Securities

  	
   

  
	
  SECTION 2.11.

  	
  Cancellation

  	
   

  
	
  SECTION 2.12.

  	
  Defaulted Interest

  	
   

  
	
  SECTION 2.13.

  	
  CUSIP or CINS Number

  	
   

  
	
  SECTION 2.14.

  	
  Payments of Interest

  	
   

  
	
   

  	
   

  	
   

  
	
  ARTICLE THREE

  	
   

  
	
   

  	
   

  	
   

  
	
  REDEMPTION

  	
   

  
	
   

  	
   

  
	
  SECTION 3.01.

  	
  Notices to Trustee

  	
   

  
	
  SECTION 3.02.

  	
  Selection of Securities to Be Redeemed

  	
   

  
	
  SECTION 3.03.

  	
  Notice of Redemption

  	
   

  
	
  SECTION 3.04.

  	
  Effect of Notice of Redemption

  	
   

  
	
  SECTION 3.05.

  	
  Deposit of Redemption Price

  	
   

  
	
  SECTION 3.06.

  	
  Securities Redeemed in Part

  	
   

  
	
   

  	
   

  	
   

  
	
  ARTICLE FOUR

  	
   

  
	
   

  	
   

  	
   

  
	
  COVENANTS

  	
   

  
	
   

  	
   

  
	
  SECTION 4.01.

  	
  Payment of Securities

  	
   

  

 

i

 

	
  SECTION 4.02.

  	
  Maintenance of Office or Agency

  	
   

  
	
  SECTION 4.03.

  	
  Limitation on Transactions with Affiliates

  	
   

  
	
  SECTION 4.04.

  	
  Limitation on Incurrence of Indebtedness

  	
   

  
	
  SECTION 4.05.

  	
  Limitation on Certain Asset Dispositions

  	
   

  
	
  SECTION 4.06.

  	
  Limitation on Restricted Payments

  	
   

  
	
  SECTION 4.07.

  	
  Corporate Existence

  	
   

  
	
  SECTION 4.08.

  	
  Payment of Taxes and Other Claims

  	
   

  
	
  SECTION 4.09.

  	
  Notice of Defaults

  	
   

  
	
  SECTION 4.10.

  	
  Maintenance of Properties

  	
   

  
	
  SECTION 4.11.

  	
  Compliance Certificate

  	
   

  
	
  SECTION 4.12.

  	
  Provision of Financial Information

  	
   

  
	
  SECTION 4.13.

  	
  Waiver of Stay, Extension or Usury Laws

  	
   

  
	
  SECTION 4.14.

  	
  Change of Control

  	
   

  
	
  SECTION 4.15.

  	
  Limitation on Senior Subordinated
  Indebtedness

  	
   

  
	
  SECTION 4.16.

  	
  Limitation on Restrictions Affecting
  Restricted Subsidiaries

  	
   

  
	
  SECTION 4.17.

  	
  Limitation on Liens

  	
   

  
	
  SECTION 4.18.

  	
  Subsidiary Guarantees

  	
   

  
	
  SECTION 4.19.

  	
  Limitation on Sale and Lease-Back
  Transactions

  	
   

  
	
   

  	
   

  	
   

  
	
  ARTICLE FIVE

  	
   

  
	
   

  	
   

  	
   

  
	
  MERGERS; SUCCESSOR
  CORPORATION

  	
   

  
	
   

  	
   

  
	
  SECTION 5.01.

  	
  Restriction on Mergers, Consolidations and
  Certain Sales of Assets

  	
   

  
	
  SECTION 5.02.

  	
  Successor Corporation Substituted

  	
   

  
	
   

  	
   

  	
   

  
	
  ARTICLE SIX

  	
   

  
	
   

  	
   

  	
   

  
	
  DEFAULT AND REMEDIES

  	
   

  
	
   

  	
   

  
	
  SECTION 6.01.

  	
  Events of Default

  	
   

  
	
  SECTION 6.02.

  	
  Acceleration

  	
   

  
	
  SECTION 6.03.

  	
  Other Remedies

  	
   

  
	
  SECTION 6.04.

  	
  Waiver of Past Default

  	
   

  
	
  SECTION 6.05.

  	
  Control by Majority

  	
   

  
	
  SECTION 6.06.

  	
  Limitation on Suits

  	
   

  
	
  SECTION 6.07.

  	
  Rights of Holders to Receive Payment

  	
   

  
	
  SECTION 6.08.

  	
  Collection Suit by Trustee

  	
   

  
	
  SECTION 6.09.

  	
  Trustee May File Proofs of Claim

  	
   

  
	
  SECTION 6.10.

  	
  Priorities

  	
   

  
	
  SECTION 6.11.

  	
  Undertaking for Costs

  	
   

  
	
   

  	
   

  	
   

  
	
  ARTICLE SEVEN

  	
   

  
	
   

  	
   

  	
   

  
	
  TRUSTEE

  	
   

  
	
   

  	
   

  
	
  SECTION 7.01.

  	
  Duties of Trustee

  	
   

  

 

ii

 

	
  SECTION 7.02.

  	
  Rights of Trustee

  	
   

  
	
  SECTION 7.03.

  	
  Individual Rights of Trustee

  	
   

  
	
  SECTION 7.04.

  	
  Trustee’s Disclaimer

  	
   

  
	
  SECTION 7.05.

  	
  Notice of Defaults

  	
   

  
	
  SECTION 7.06.

  	
  Reports by Trustee to Holders

  	
   

  
	
  SECTION 7.07.

  	
  Compensation and Indemnity

  	
   

  
	
  SECTION 7.08.

  	
  Replacement of Trustee

  	
   

  
	
  SECTION 7.09.

  	
  Successor Trustee by Merger, Etc.

  	
   

  
	
  SECTION 7.10.

  	
  Eligibility; Disqualification

  	
   

  
	
  SECTION 7.11.

  	
  Preferential Collection of Claims Against
  Company

  	
   

  
	
   

  	
   

  	
   

  
	
  ARTICLE EIGHT

  	
   

  
	
   

  	
   

  	
   

  
	
  [RESERVED]

  	
   

  
	
   

  	
   

  	
   

  
	
  ARTICLE NINE

  	
   

  
	
   

  	
   

  	
   

  
	
  SATISFACTION
  AND DISCHARGE OF INDENTURE; DEFEASANCE

  	
   

  
	
   

  	
   

  
	
  SECTION 9.01.

  	
  Termination of Company’s Obligations

  	
   

  
	
  SECTION 9.02.

  	
  Application of Trust Money

  	
   

  
	
  SECTION 9.03.

  	
  Repayment to Company

  	
   

  
	
  SECTION 9.04.

  	
  Reinstatement

  	
   

  
	
   

  	
   

  	
   

  
	
  ARTICLE TEN

  	
   

  
	
   

  	
   

  	
   

  
	
  AMENDMENTS,
  SUPPLEMENTS AND WAIVERS

  	
   

  
	
   

  	
   

  
	
  SECTION 10.01.

  	
  Without Consent of Holders

  	
   

  
	
  SECTION 10.02.

  	
  With Consent of Holders

  	
   

  
	
  SECTION 10.03.

  	
  Compliance with Trust Indenture Act

  	
   

  
	
  SECTION 10.04.

  	
  Revocation and Effect of Consents

  	
   

  
	
  SECTION 10.05.

  	
  Notation on or Exchange of Securities

  	
   

  
	
  SECTION 10.06.

  	
  Trustee To Sign Amendments, etc.

  	
   

  
	
   

  	
   

  	
   

  
	
  ARTICLE ELEVEN

  	
   

  
	
   

  	
   

  	
   

  
	
  GUARANTEE

  	
   

  
	
   

  	
   

  
	
  SECTION 11.01.

  	
  Unconditional Guarantee

  	
   

  
	
  SECTION 11.02.

  	
  Severability

  	
   

  
	
  SECTION 11.03.

  	
  Release of a Guarantor

  	
   

  
	
  SECTION 11.04.

  	
  Limitation of Guarantor’s Liability

  	
   

  
	
  SECTION 11.05.

  	
  Contribution

  	
   

  
	
  SECTION 11.06.

  	
  Execution of Guarantee

  	
   

  
	
  SECTION 11.07.

  	
  [Reserved]

  	
   

  
	
  SECTION 11.08.

  	
  Guarantors May Consolidate, Etc., on
  Certain Terms

  	
   

  

 

iii

 

	
  ARTICLE TWELVE

  	
   

  
	
   

  	
   

  	
   

  
	
  [RESERVED]

  	
   

  
	
   

  	
   

  	
   

  
	
  ARTICLE THIRTEEN

  	
   

  
	
   

  	
   

  	
   

  
	
  MISCELLANEOUS

  	
   

  
	
   

  	
   

  
	
  SECTION 13.01.

  	
  Trust Indenture Act Controls

  	
   

  
	
  SECTION 13.02.

  	
  Notices

  	
   

  
	
  SECTION 13.03.

  	
  Communications by Holders with Other
  Holders

  	
   

  
	
  SECTION 13.04.

  	
  Certificate and Opinion as to Conditions
  Precedent

  	
   

  
	
  SECTION 13.05.

  	
  Statements Required in Certificate or
  Opinion

  	
   

  
	
  SECTION 13.06.

  	
  Rules by Trustee, Paying Agent, Registrar

  	
   

  
	
  SECTION 13.07.

  	
  Governing Law

  	
   

  
	
  SECTION 13.08.

  	
  No Recourse Against Others

  	
   

  
	
  SECTION 13.09.

  	
  Successors

  	
   

  
	
  SECTION 13.10.

  	
  Counterpart Originals

  	
   

  
	
  SECTION 13.11.

  	
  Severability

  	
   

  
	
  SECTION 13.12.

  	
  No Adverse Interpretation of Other
  Agreements

  	
   

  
	
  SECTION 13.13.

  	
  Legal Holidays

  	
   

  

 

	
  Exhibit A

  	
   

  	
  –

  	
   

  	
  Form of Security

  	
   

  
	
  Exhibit B

  	
   

  	
  –

  	
   

  	
  Form of Certificate of Transfer

  	
   

  
	
  Exhibit C

  	
   

  	
  –

  	
   

  	
  Form of Certificate of Exchange

  	
   

  
	
  Exhibit D

  	
   

  	
  –

  	
   

  	
  Form of Certificate from Acquiring
  Institutional Accredited Investor

  	
   

  

 

 

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

 

 

iv

 

INDENTURE dated as of March 18, 2005, between AEP
INDUSTRIES INC., a Delaware corporation (the “Company”) and THE BANK OF
NEW YORK, a New York banking corporation, as trustee (the “Trustee”).

 

Each party hereto agrees as follows for the benefit of
the other parties and for the equal and ratable benefit of the Holders of the
Company’s 7.875% Senior Notes due 2013:

 

ARTICLE ONE

 

DEFINITIONS AND INCORPORATION BY REFERENCE

 

SECTION 1.01.   Definitions.

 

“144A Global Security”
means a global security substantially in the form of Exhibit A bearing
the Global Security Legend and the Private Placement Legend and deposited with
or on behalf of, and registered in the name of, the Depositary or its nominee,
that shall be issued in a denomination equal to the outstanding principal
amount at maturity of the Securities sold in reliance on Rule 144A.

 

“Acquired Indebtedness” means, with respect to
any Person, Indebtedness of such Person (i) existing at the time such Person
becomes a Restricted Subsidiary or (ii) assumed in connection with the
acquisition of assets from another Person, including Indebtedness Incurred in
connection with, or in contemplation of, such Person’s becoming a Restricted
Subsidiary or such acquisition, as the case may be.

 

“Acquisition” means (i) any capital
contribution (by means of transfers of cash or other property to others or
payments for property or services for the account or use of others, or
otherwise) by the Company or any Restricted Subsidiary to any other Person, or
any acquisition or purchase of Capital Stock of any other Person by the Company
or any Restricted Subsidiary, in either case pursuant to which such Person
shall become a Restricted Subsidiary or shall be consolidated or merged with or
into the Company or any Restricted Subsidiary or (ii) any acquisition by the
Company or any Restricted Subsidiary of the assets of any Person which
constitute substantially all of an operating unit or line of business of such
Person or which is otherwise outside of the ordinary course of business.

 

“Additional Interest” shall have the meaning
set forth in the Registration Rights Agreement.

 

“Additional Securities” means an unlimited
maximum aggregate principal amount of Securities (other than the Securities
issued on the date hereof) issued under this Indenture in accordance with
Sections 2.02 and 4.04.

 

“Affiliate” of any specified Person means any
other Person directly or indirectly controlling or controlled by or under
direct or indirect common control with any specified Person.  For purposes of this definition, “control”
when used with respect to any 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.

 

 

“Agent” means any Registrar, Paying Agent or
co-Registrar.  See Section 2.03.

 

“Applicable Procedures” means with respect to
any transfer or exchange of interests in a Global Security, the rules and
procedures of DTC, Euroclear and Cedel that apply to such transfer or exchange.

 

“Asia/Pacific Operations Sale” means the sale
of (i) all or any substantial portion of the assets of AEP Industries
(Australia) Pty Limited, AEP Industries (NZ) Limited or any of their respective
subsidiaries (collectively, the “Asia/Pacific Subsidiaries”) to any
person other than an Affiliate of the Company or (ii) all of the capital stock
of the Asia/Pacific Subsidiaries, including and together with the merger or
consolidation of the Asia/Pacific Subsidiaries with any other Person, to any
Person other than an Affiliate of the Company.

 

“Asset Disposition” means any sale, transfer or
other disposition (including, without limitation, by merger, consolidation or
sale-and-leaseback transaction) of (i) shares of Capital Stock of a Subsidiary
of the Company (other than directors’ qualifying shares or shares of
Subsidiaries of the Company that are not Domestic Subsidiaries that are
required by applicable law to be held by a Person other than the Company or a
Restricted Subsidiary) or (ii) property or assets of the Company or any
Restricted Subsidiary of the Company; provided, however, that an
Asset Disposition shall not include:  (a)
any sale, transfer or other disposition of shares of Capital Stock, property or
assets by a Restricted Subsidiary to the Company or to any Wholly Owned
Subsidiary, (b) any sale, transfer or other disposition of defaulted
receivables for collection or any sale, transfer or other disposition of
property or assets in the ordinary course of business, (c) any sale,
transfer or other disposition that does not (together with all related sales,
transfers or dispositions) involve aggregate consideration in excess of $1.0
million, (d) the grant in the ordinary course of business of any non-exclusive
license of patents, trademarks, registrations therefor and other similar
intellectual property, (e) the granting of any Lien (or foreclosure thereon)
securing Indebtedness to the extent that such Lien is granted in compliance
with Section 4.17, (f) any Restricted Payment or Permitted Investment permitted
by Section 4.06, (g) any disposition of property or assets in the ordinary
course of business or of property or assets that are obsolete, worn-out,
damaged, fully depreciated or otherwise unsuitable for use in the Company’s or
any Restricted Subsidiary’s business, (h) the sale, lease, conveyance or
disposition or other transfer of all or substantially all of the assets of the
Company as permitted under Section 5.01, (i) any disposition that constitutes a
Change of Control, (j) a disposition of cash or Cash Equivalents, or (k) the
good faith surrender or waiver of contract rights, tort claims or statutory
rights.

 

“Attributable Indebtedness” in respect of a
Sale and Lease-Back Transaction by the Company or any Restricted Subsidiary of
the Company means, as at the time of determination, the present value
(discounted according to GAAP at the cost of indebtedness implied in the lease)
of the total obligations of the lessee for rental payments during the remaining
term of the lease included in such Sale and Lease-Back Transaction (including
any period for which such lease has been extended).

 

“Average Life” means, as of the date of
determination, with respect to any Indebtedness for borrowed money or Preferred
Stock, the quotient obtained by dividing (i) the sum of the products of the
number of years from the date of determination to the dates of each

 

2

 

successive scheduled
principal or liquidation value payments of such Indebtedness or Preferred
Stock, respectively, and the amount of such principal or liquidation value
payments, by (ii) the sum of all such principal or liquidation value payments.

 

“Bankruptcy Code” means Title 11, United States
Code, as amended.

 

“Board of Directors” means (i) with respect to
a corporation, the board of directors of the corporation; (ii) with respect to
a partnership, the Board of Directors of the general partner of the
partnership; and (iii) with respect to any other Person, the board or committee
of such Person serving a similar function.

 

“Board Resolution” means, with respect to any
Person, a duly adopted resolution of the Board of Directors of such Person.

 

“Broker-Dealer”
has the meaning set forth in the Registration Rights Agreement.

 

“Business Day” means each Monday, Tuesday,
Wednesday, Thursday and Friday which is not a day on which banking institutions
in The City of New York, New York are authorized or obligated by law or
executive order to close.

 

“Capital Lease Obligations” means the obligations
of the Company or any Restricted Subsidiary to pay rent or other amounts under
a lease of (or other Indebtedness arrangements conveying the right to use) real
or personal property of such Person which are required to be classified and
accounted for as a capital lease or liability on the face of a balance sheet of
such Person in accordance with GAAP.  The
amount of such obligations shall be the capitalized amount thereof in
accordance with GAAP and the stated maturity thereof shall be the date of the
last payment of rent or any other amount due under such lease prior to the
first date upon which such lease may be terminated by the lessee without
payment of a penalty.

 

“Capital Stock” of any Person means any and all
shares, interests, participations or other equivalents (however designated) of
corporate stock of such Person.

 

“Cash Equivalents” means (i) United States
dollars and local currency held by a Foreign Restricted Subsidiary of the
Company from time to time in the ordinary course of business; (ii) marketable,
direct obligations issued or guaranteed by the United States of America, or any
governmental entity or agency or political subdivision thereof (provided
that the full faith and credit of the United States of America is pledged in
support thereof), maturing within one year of the date of purchase; (iii)
commercial paper issued by corporations or financial institutions maturing
within 180 days from the date of the original issue thereof, and rated “P-1” or
better by Moody’s Investors Service, Inc. or “A-1” or better by Standard &
Poor’s Rating Services or an equivalent rating or better by any other
nationally recognized securities rating agency; (iv) certificates of deposit
issued or acceptances accepted by or guaranteed by any bank or trust company
organized under the laws of the United States of America or any state thereof
or the District of Columbia, in each case having capital, surplus and undivided
profits totaling more than $500,000,000, maturing within one year of the date
of purchase; (v) money market funds substantially all of whose assets comprise
securities of the type described in clauses (ii) through (iv) above and (vi)
and (vii) below; (vi) repurchase obligations with a term of not more than seven
days for underlying securities of the types described in clauses (i) and (iii)

 

3

 

above entered into with
any financial institution meeting the qualifications specified in clause (iii)
above; (vii) readily marketable direct obligations issued by any state of the
United States of America or any political subdivision thereof having one of the
two highest rating categories obtainable from either Moody’s Investors Service,
Inc. or Standard & Poor’s Rating Services; and (viii) solely in respect of
the cash management activities of the Foreign Restricted Subsidiaries of the
Company, equivalents to the investments described in clause (ii) above to the
extent guaranteed by any member state of the European Union or the country in
which the Foreign Restricted Subsidiary operates and equivalents of investments
described in clause (iv) above issued, accepted or offered by the local office
of any commercial bank organized under the laws of the jurisdiction of
organization of the applicable Foreign Restricted Subsidiary which bank has
combined capital, surplus and undivided profits totaling more than
$500,000,000.

 

“Clearstream”
means Clearstream Banking S.A. and any successor thereto.

 

“Common Stock” of any Person means Capital
Stock of such Person that does not rank prior, as to the payment of dividends
or as to the distribution of assets upon any voluntary or involuntary
liquidation, dissolution or winding up of such Person, to shares of Capital
Stock of any other class of such Person.

 

“Consolidated Cash Flow Available for Fixed Charges”
of any Person means for any period the Consolidated Net Income of such Person
for such period increased (to the extent Consolidated Net Income for such
period has been reduced thereby) by the sum of (without duplication) (i)
Consolidated Interest Expense of such Person for such period, plus (ii)
Consolidated Income Tax Expense of such Person for such period, plus (iii) the
consolidated depreciation and amortization expense included in the income
statement of such Person prepared in accordance with GAAP for such period, plus
(iv) any other non-cash charges to the extent deducted from or reflected in
Consolidated Net Income except for any non-cash charges that represent accruals
of, or reserves for, cash disbursements to be made in any future accounting
period.

 

“Consolidated Cash Flow Ratio” of any Person
means for any period the ratio of (i) Consolidated Cash Flow Available for
Fixed Charges of such Person for such period to (ii) Consolidated Fixed Charges
for such period; provided, however, that all Incurrences and
repayments of Indebtedness (including the Incurrence giving rise to such
calculation and any repayments in connection therewith) and all dispositions
(including discontinued operations) or acquisition of assets (other than in the
ordinary course of business) (including pursuant to a merger or acquisition of
Capital Stock or otherwise) made during or after such period and on or prior to
the date of determination shall be given pro forma effect as if they occurred on
the first day of such four-quarter period, except that Indebtedness under the
Senior Credit Facility shall be deemed to be the average daily balance of such
Indebtedness during such four-quarter period. 
Calculations of pro forma amounts in accordance with this definition
shall be done in accordance with Article 11 of Regulation S-X under the
Securities Act or any successor provision.

 

“Consolidated Fixed Charges” means, with
respect to any Person for any period, the sum, without duplication, of (i)
Consolidated Interest Expense, plus (ii) the product of (x) the amount of all
dividends on any series of Preferred Stock and Disqualified Stock of such
Person and its Restricted Subsidiaries (other than dividends paid in Qualified
Capital Stock) paid,

 

4

 

accrued or scheduled to
be paid or accrued during such period times (y) a fraction, the numerator of
which is one and the denominator of which is one minus the then current
effective consolidated federal, state and local tax rate of such Person,
expressed as a decimal.

 

“Consolidated Income Tax Expense” of any Person
means for any period the consolidated provision for income taxes of such Person
and its Restricted Subsidiaries for such period calculated on a consolidated
basis in accordance with GAAP.

 

“Consolidated Interest Expense” for any Person
means for any period, without duplication, (a) the consolidated interest
expense included in a consolidated income statement (without deduction of
interest or finance charge income) of such Person and its Restricted
Subsidiaries for such period calculated on a consolidated basis in accordance
with GAAP (including, without limitation, (i) any amortization of debt
discount, (ii) the net costs under interest rate agreements, (iii) all
capitalized interest, (iv) imputed interest with respect to Attributable
Indebtedness and (v) the interest portion of any deferred payment obligation)
and (b) the interest component of Capital Lease Obligations paid, accrued
and/or scheduled to be paid or accrued by such Person and its Restricted
Subsidiaries during such period as determined on a consolidated basis in
accordance with GAAP.

 

“Consolidated Net Income” of any Person means
for any period the consolidated net income (or loss) of such Person and its
Restricted Subsidiaries for such period determined on a consolidated basis in
accordance with GAAP; provided, however, that there shall be
excluded therefrom (a) the net income (but not loss) of any Restricted
Subsidiary of such Person which is subject to restrictions which prevent or
limit the payment of dividends or the making of distributions to such Person to
the extent of such restrictions (regardless of any waiver thereof), (b)
non-cash gains and losses due solely to fluctuations in currency values, (c)
the net income (but not loss) of any Person that is not a Restricted Subsidiary
of such Person, except to the extent of the amount of dividends or other
distributions, representing such Person’s proportionate share of such other
Person’s net income for such period, actually paid in cash to such Person by
such other Person during such period, (d) gains or losses (other than for
purposes of calculating Consolidated Net Income under clause (3) of the first
paragraph of Section 4.06) on Asset Dispositions by such Person or its
Restricted Subsidiaries, (e) all extraordinary or non-recurring gains and
losses determined in accordance with GAAP, (f) in the case of a successor to
the referent Person by consolidation or merger or as a transferee of the
referent Person’s assets, any earnings (or losses) of the successor corporation
prior to such consolidation, merger or transfer of assets, and (g) the
cumulative effect of a change in accounting principles.

 

“Consolidated Tangible Assets” means, as of any
date, all amounts that would be shown as assets on a consolidated balance sheet
of such Person and its Subsidiaries prepared in accordance with GAAP, less the
amount thereof constituting goodwill and other intangible assets as calculated
in accordance with GAAP.

 

“Continuing Director” means a director who
either was a member of the Board of Directors of the Company on the Issue Date
or who became a director of the Company subsequent to the Issue Date and whose
election, or nomination for election by the Company’s stockholders, was duly
approved by a majority of the Continuing Directors then on the Board of
Directors of the Company, either by a specific vote or by approval of the proxy
statement issued

 

5

 

by the Company on behalf
of the entire Board of Directors of the Company in which such individual is
named as nominee for director.

 

“Currency Agreement” means, with respect to any
Person, any foreign exchange contract, currency swap agreement or other similar
agreement or arrangement, which may include the use of derivatives, designed to
protect such Person against, or to expose such Person to, fluctuations in
currency values entered into in the ordinary course of business and not for the
purpose of speculation.

 

“Default” means any event that is, or after
notice or lapse of time or both would become, an Event of Default.

 

“Definitive Security” means a certificated
Security registered in the name of the Holder thereof and issued in accordance
with Section 2.06, substantially in the form of Exhibit A, except that
such Security shall not bear the Global Security Legend and shall not have the “Schedule
of Exchanges of Interests in the Global Security” attached thereto.

 

“Depositary”
means, with respect to the Securities issuable or issued in whole or in part in
global form, the Person specified in Section 2.03 as the Depositary with
respect to the Securities, and any and all successors thereto appointed as
depositary hereunder and having become such pursuant to the applicable
provision of this Indenture.

 

“Designated Preferred Stock” means preferred
stock of the Company (other than Disqualified Stock) that is issued for cash
(other than to a Restricted Subsidiary) and is so designated as Designated
Preferred Stock pursuant to an Officers’ Certificate executed by the principal
executive officer and the principal financial officer of the Company, on the
date of issuance thereof; provided, however, that the net cash
proceeds received by the Company from the issuance of such Designated Preferred
Stock are excluded from the calculation set forth in clause (3) of the first
paragraph of Section 4.06.

 

“Disqualified Stock” of any Person means any
Capital Stock of such Person which, by its terms (or by the terms of any
security into which it is convertible or for which it is exchangeable), or upon
the happening of any event, matures or is mandatorily redeemable, pursuant to a
sinking fund obligation or otherwise, or is redeemable at the option of the
holder thereof, in whole or in part, on or prior to the final maturity of the
Securities.  Notwithstanding the
preceding sentence, any Capital Stock that would constitute Disqualified Stock
solely because the holders thereof have the right to require the Company to
repurchase such Capital Stock upon the occurrence of a change of control or an
asset sale will not constitute Disqualified Stock if the terms of such Capital
Stock provide that the Company may not repurchase or redeem any such Capital
Stock pursuant to such provisions unless such repurchase or redemption complies
with Section 4.06.

 

“Domestic Subsidiary” means any Restricted
Subsidiary of the Company other than a Restricted Subsidiary that is (1) a “controlled
foreign corporation” under Section 957 of the Internal Revenue Code (a) whose
primary operating assets are located outside the United States and (b) that is
not subject to tax under Section 882(a) of the Internal Revenue Code in

 

6

 

respect of a substantial
trade or business within the United States or (2) a Subsidiary of an entity
described in the preceding clause (1).

 

“DTC” means The Depository Trust Company or its
successors.

 

“Equity Offering” means an underwritten public
offering of Common Stock of the Company pursuant to an effective registration
statement filed under the Securities Act (excluding any registration statements
filed on Form S-8 or any successor form).

 

“Euroclear” means Morgan Guaranty Trust Company
of New York (Brussels Office) as operator of the Euroclear System.

 

“Exchange Act” means the Securities Exchange
Act of 1934, as amended, and the rules and regulations promulgated by the SEC
thereunder.

 

“Exchange Offer” has the meaning set forth in
the Registration Rights Agreement.

 

“Exchange Registration Statement” has the
meaning set forth in the Registration Rights Agreement.

 

“Exchange Securities” means the Securities
issued in the Exchange Offer in accordance with Section 2.06(f).

 

“Existing Notes” means the 9.875% Senior
Subordinated Notes due 2007 issued by the Company pursuant to an Indenture
between the Company and The Bank of New York, as trustee, dated November 19,
1997, as amended.

 

“Expiration Date” has the meaning set forth in
the definition of “Offer to Purchase.”

 

“Fair Market Value” means, with respect to any
asset, the price (after taking into account any liabilities relating to such
asset) which could be negotiated in an arm’s-length transaction, for cash,
between a willing seller and a willing and able buyer, neither of which is
under any compulsion to complete the transaction; provided, however,
that the Fair Market Value of any such asset or assets shall be determined
conclusively (i) for any determination pursuant to Section 4.05 or Section 4.06
by the Board of Directors of the Company acting in good faith, which
determination shall be evidenced by a resolution of such Board delivered to the
Trustee, and (ii) for any other determination by an officer of the Company
acting in good faith.

 

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

 

“GAAP” means generally accepted accounting
principles, consistently applied, as in effect on the Issue Date in the United
States of America, as set forth in the opinions and pronouncements of the
Accounting Principles Board of the American Institute of Certified Public
Accountants and statements and pronouncements of the Financial Accounting
Standards Board or in such other statements by such other entity as is approved
by a significant segment of the accounting profession in the United States.

 

7

 

“Global Securities” means, individually and
collectively, each of the Restricted Global Securities and the Unrestricted
Global Securities, substantially in the form of Exhibit A, issued in
accordance with Section 2.01 or Section 2.06.

 

“Global Security Legend” means the legend set
forth in Section 2.06(g)(ii), which is required to be placed on all Global
Securities issued under this Indenture.

 

“Government Obligations” means securities that
are direct obligations of the United States of America for the timely payment
of which its full faith and credit is pledged.

 

“Guarantee” means the guarantee of the
Securities by each Guarantor under this Indenture.

 

“Guarantor” means any Subsidiary of the Company
that executes a Guarantee in accordance with the provisions of this Indenture
and such Subsidiary’s successors and assigns until released from their
obligations under their Guarantees and this Indenture in accordance with the terms
of this Indenture.

 

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

 

“Incur” means, with respect to any Indebtedness
or other obligation of any Person, to create, issue, incur (including by
conversion, exchange or otherwise), assume, guarantee or otherwise become
liable in respect of such Indebtedness or other obligation or the recording, as
required pursuant to GAAP or otherwise, of any such Indebtedness or other
obligation on the balance sheet of such Person (and “Incurrence,” “Incurred”
and “Incurring” shall have meanings correlative to the foregoing).  Indebtedness of any Person or any of its
Restricted Subsidiaries existing at the time such Person becomes a Restricted
Subsidiary (or is merged into or consolidates with the Company or any
Restricted Subsidiary), whether or not such Indebtedness was incurred in
connection with, or in contemplation of, such Person becoming a Restricted
Subsidiary (or being merged into or consolidated with the Company or any
Restricted Subsidiary), shall be deemed Incurred at the time any such Person
becomes a Restricted Subsidiary or merges into or consolidates with the Company
or any Restricted Subsidiary.

 

“Indebtedness” means (without duplication),
with respect to any Person, whether recourse is to all or a portion of the
assets of such Person, indebtedness, whether or not contingent:  (i) in respect of borrowed money; (ii)
evidenced by bonds, debentures, notes or other similar instruments, including
obligations incurred in connection with the acquisition of property, assets or
businesses; (iii) in respect of letters of credit, bankers’ acceptances or
similar facilities issued for the account of such Person; (iv) in respect of
the deferred purchase price of property or services (but excluding trade
accounts payable or accrued liabilities, in each case, arising in the ordinary
course of business which are not overdue by more than 90 days from their
original due date or which are being contested in good faith); (v) in respect
of Capital Lease Obligations of such Person; (vi) representing interest rate
agreements or Currency Agreements of such Person; (vii) representing
Attributable Indebtedness; and (viii) every type of indebtedness referred to in
clauses (i) through (vi) and in the sentence immediately following this clause
(viii)

 

8

 

of another Person and all
dividends of another Person the payment of which, in either case, such Person
has guaranteed or is responsible or liable for, directly or indirectly, as
obligor, guarantor or otherwise. 
Indebtedness shall include the liquidation preference and any mandatory
redemption payment obligations in respect of any Disqualified Stock of such
Person, and any Preferred Stock of a Subsidiary of such Person.  Indebtedness shall never be calculated taking
into account any cash and cash equivalents held by such Person.  The amount of any Indebtedness outstanding as
of any date will be the accreted value thereof, in the case of any Indebtedness
issued with original issue discount and the principal amount thereof, together
with any interest thereon that is more than 30 days past due, in the case of
any other Indebtedness.

 

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

 

“Indirect Participant”
means a Person who holds a beneficial interest in a Global Security through a
Participant.

 

“Institutional Accredited Investor” means an
institution that is an “accredited investor” as defined in Rule 501(a)(1), (2),
(3) or (7) under the Securities Act, who is not also a QIB.

 

“interest” means, with respect to the
Securities, the sum of any cash interest and any Additional Interest on the
Securities.

 

“Interest Payment Date” has the meaning given
to such term in the Securities.

 

“Interest Rate Obligations” means, with respect
to any Person, the obligations of such Person under (i) interest rate swap
agreements, interest rate cap agreements and interest rate collar agreements,
and (ii) other agreements or arrangements designed to protect such Person
against, or to expose such Person to, fluctuations in interest rates.

 

“Investment” by any Person means any direct or
indirect loan, advance, guarantee or other extension of credit or capital
contribution to (by means of transfers of cash or other property to others or
payments for property or services for the account or use of others, or
otherwise), or purchase or acquisition of Capital Stock, bonds, notes,
debentures or other securities or evidence of Indebtedness issued by any other
Person.  For purposes of Section 4.06,
the amount of any investment shall be the original cost of such investment,
plus the cost of all additions thereto, but without any other adjustments for
increases or decreases in value, or write-ups, write-downs or write-offs with
respect to such investment.

 

“Issue Date” means March 18, 2005, the original
issue date of the Securities.

 

“Legended Regulation S Global Security” means a
global Security in the form of Exhibit A bearing the Global
Security Legend and the Private Placement Legend and deposited with or on
behalf of and registered in the name of the Depositary or its nominee, issued
in a denomination equal to the outstanding principal amount at maturity of the
Securities initially sold in reliance on Rule 903 of Regulation S.

 

9

 

“Letter of Transmittal”
means the letter of transmittal to be prepared by the Company and sent to all
Holders of the Securities for use by such Holders in connection with the
Exchange Offer.

 

“Lien” means, with respect to any property or
assets, any mortgage or deed of trust, pledge, hypothecation, assignment,
security interest, lien, charge, easement (other than any easement not
materially impairing usefulness or marketability), encumbrance, preference,
priority or other security agreement with respect to such property or assets
(including, without limitation, any conditional sale or other title retention
agreement having substantially the same economic effect as any of the
foregoing).

 

“Material Subsidiary” means, at any date of
determination, (a) any Restricted Subsidiary that, together with its
Subsidiaries that constitute Restricted Subsidiaries, would constitute a “significant
subsidiary” within the meaning of Article I of Regulation S-X of the Securities
Act and (b) any Restricted Subsidiary which, when aggregated with all other
Restricted Subsidiaries that are not otherwise Material Subsidiaries and as to
which any event described in Section 6.01(f), (g), (h) and (i) has occurred,
would constitute a Material Subsidiary under clause (a) of this definition.

 

“Net Available Proceeds” from any Asset
Disposition by any Person means cash or readily marketable cash equivalents
received (including by way of sale or discounting of a note, installment
receivable or other receivable, but excluding any other consideration received
in the form of assumption by the acquirer of Indebtedness or other obligations
relating to such properties or assets or received in any other non-cash form)
therefrom by such Person, including any cash received by way of deferred
payment or upon the monetization or other disposition of any non-cash
consideration (including notes or other securities) received in connection with
such Asset Disposition, net of:  (i) all
legal, title and recording tax expenses, commissions and other fees and
expenses incurred and all federal, state, foreign and local taxes required to
be accrued as a liability as a consequence of such Asset Disposition, (ii) all
payments made by such Person or any of its Restricted Subsidiaries on any
Indebtedness which is secured by such assets in accordance with the terms of
any Lien upon or with respect to such assets or which must by the terms of such
Lien, or in order to obtain a necessary consent to such Asset Disposition or by
applicable law, be repaid out of the proceeds from such Asset Disposition,
(iii) all payments made with respect to liabilities associated with the assets
which are the subject of the Asset Disposition, including, without limitation,
trade payables and other accrued liabilities, (iv) appropriate amounts to be
provided by such Person or any Restricted Subsidiary thereof, as the case may
be, as a reserve in accordance with GAAP or in an escrow or similar arrangement
against any liabilities associated with such assets and retained by such Person
or any Restricted Subsidiary thereof, as the case may be, after such Asset
Disposition, including, without limitation, liabilities under any indemnification
obligations and severance and other employee termination costs associated with
such Asset Disposition, until such time as such amounts are no longer reserved
or such reserve, escrow or similar arrangement is no longer necessary (at which
time any remaining amounts will become Net Available Proceeds to be allocated
in accordance with the provisions of clause (iii) of Section 4.05) and (v) all
distributions and other payments made to minority interest holders in
Restricted Subsidiaries of such Person or joint ventures as a result of such
Asset Disposition.

 

10

 

“Net Investment” means the excess of (i) the
aggregate amount of all Investments made in any Unrestricted Subsidiary or
joint venture by the Company or any Restricted Subsidiary on or after the Issue
Date (in the case of an Investment made other than in cash, the amount shall be
the fair market value of such Investment as determined in good faith by the
Board of Directors of the Company or such Restricted Subsidiary) over (ii) the
aggregate amount returned in cash on or with respect to such Investments
whether through interest payments, principal payments, dividends or other
distributions or payments; provided, however, that such payments
or distributions shall not be (and have not been) included in clause (3) of the
first paragraph of Section 4.06; provided  further that with
respect to all Investments made in any Unrestricted Subsidiary or joint venture
the amounts referred to in clause (ii) above with respect to such Investments
shall not exceed the aggregate amount of all such Investments made in such
Unrestricted Subsidiary or joint venture.

 

“Offer to Purchase” means a written offer (the “Offer”)
sent by the Company by first class mail, postage prepaid, to each holder at his
address appearing in the register for the Securities on the date of the Offer
offering to purchase up to the principal amount of Securities specified in such
Offer at the purchase price specified in such Offer (as determined pursuant to
this Indenture).  Unless otherwise
required by applicable law, the Offer shall specify an expiration date (the “Expiration
Date”) of the Offer to Purchase which shall be not less than 30 days nor
more than 60 days after the date of such Offer and a settlement date (the “Purchase
Date”) for purchase of Securities within five Business Days after the
Expiration Date.  The Company shall
notify the Trustee at least 15 Business Days (or such shorter period as is
acceptable to the Trustee) prior to the mailing of the Offer of the Company’s
obligation to make an Offer to Purchase, and the Offer shall be mailed by the
Company or, at the Company’s request, by the Trustee in the name and at the
expense of the Company.  The Offer shall
contain all the information required by applicable law to be included
therein.  The Offer shall contain all
instructions and materials necessary to enable such holders to tender
Securities pursuant to the Offer to Purchase. 
The Offer shall also state:

 

(1)                                  the
Section of this Indenture pursuant to which the Offer to Purchase is being
made;

 

(2)                                  the
Expiration Date and the Purchase Date;

 

(3)                                  the
aggregate principal amount of the outstanding Securities offered to be
purchased by the Company pursuant to the Offer to Purchase (including, if less
than 100%, the manner by which such amount has been determined pursuant to the
Section of this Indenture requiring the Offer to Purchase) (the “Purchase
Amount”);

 

(4)                                  the
purchase price to be paid by the Company for each $1,000 aggregate principal
amount of Securities accepted for payment (as specified pursuant to this
Indenture) (the “Purchase Price”);

 

(5)                                  that
the holder may tender all or any portion of the Securities registered in the
name of such holder and that any portion of a Security tendered must be
tendered in an integral multiple of $1,000 principal amount;

 

11

 

(6)                                  the
place or places where Securities are to be surrendered for tender pursuant to
the Offer to Purchase;

 

(7)                                  that
interest on any Security not tendered or tendered but not purchased by the
Company pursuant to the Offer to Purchase will continue to accrue;

 

(8)                                  that
on the Purchase Date the Purchase Price will become due and payable upon each
Security being accepted for payment pursuant to the Offer to Purchase and that
interest thereon shall cease to accrue on and after the Purchase Date;

 

(9)                                  that
each holder electing to tender all or any portion of a Security pursuant to the
Offer to Purchase will be required to surrender such Security at the place or
places specified in the Offer prior to the close of business on the Expiration
Date (such Security being, if the Company or the Trustee so requires, duly
endorsed by, or accompanied by a written instrument of transfer in form satisfactory
to the Company and the Trustee duly executed by, the holder thereof or his
attorney duly authorized in writing);

 

(10)                            that
holders will be entitled to withdraw all or any portion of Securities tendered
if the Company (or its Paying Agent) receives, not later than the close of
business on the fifth Business Day next preceding the Expiration Date, a
telegram, telex, facsimile transmission or letter setting forth the name of the
holder, the principal amount of the Security the holder tendered, the certificate
number of the Security the holder tendered and a statement that such holder is
withdrawing all or a portion of his tender;

 

(11)                            that
(a) if Securities in an aggregate principal amount less than or equal to the
Purchase Amount are duly tendered and not withdrawn pursuant to the Offer to
Purchase, the Company shall purchase all such Securities and (b) if Securities
in an aggregate principal amount in excess of the Purchase Amount are tendered
and not withdrawn pursuant to the Offer to Purchase, the Company shall purchase
Securities having an aggregate principal amount equal to the Purchase Amount on
a pro rata basis (with such adjustments as may be deemed appropriate so that
only Securities in denominations of $1,000 or integral multiples thereof shall
be purchased); and

 

(12)                            that
in the case of any holder whose Security is purchased only in part, the Company
shall execute and the Trustee shall authenticate and deliver to the holder of
such Security without service charge, a new Security or Securities, of any
authorized denomination as requested by such holder, in an aggregate principal
amount equal to and in exchange for the unpurchased portion of the Security so
tendered.

 

An Offer to Purchase shall be governed by and effected
in accordance with the provisions above pertaining to any Offer.

 

“Officer” means, with respect to any Person,
the Chairman of the Board, the Chief Executive Officer, the President, the
Chief Operating Officer, the Chief Financial Officer, the Treasurer, any
Assistant Treasurer, the Controller, the Secretary or any Vice-President of
such Person.

 

12

 

“Officers’ Certificate” means a certificate
signed on behalf of the Company by at least two Officers of the Company, one of
whom must be the principal executive officer, the principal financial officer,
the treasurer or the principal accounting officer of the Company, complying
with Sections 13.04 and 13.05.

 

“Opinion of Counsel” means an opinion from
legal counsel.  The counsel may be an
employee of or counsel to the Company.

 

“Pari Passu Indebtedness” means Indebtedness of
the Company ranked pari passu in
right of payment with the Securities.

 

“Participant” means, with respect to the
Depositary, Euroclear or Clearstream, a Person who has an account with the
Depositary, Euroclear or Clearstream, respectively (and with respect to DTC,
shall include Euroclear and Clearstream).

 

“Permitted Holder” means J. Brendan Barba, his
spouse, his lineal descendants, their spouses and trusts for the exclusive
benefit of any of the foregoing persons.

 

“Permitted Investments” means:  (i) Investments in Cash Equivalents;
(ii) Investments representing Capital Stock or obligations issued to the
Company or any Restricted Subsidiary in the course of the good faith settlement
of claims against any other Person or by reason of a composition or
readjustment of debt or a reorganization of any debtor of the Company or any
Restricted Subsidiary; (iii) deposits, including interest-bearing deposits,
maintained in the ordinary course of business in banks; (iv) any acquisition of
the Capital Stock of any Person; provided, however, that after
giving effect to any such acquisition such Person shall become a Restricted
Subsidiary; (v) trade receivables and prepaid expenses, in each case arising in
the ordinary course of business; provided, however, that such
receivables and prepaid expenses would be recorded as assets of such Person in
accordance with GAAP; (vi) endorsements for collection or deposit in the
ordinary course of business by such Person of bank drafts and similar
negotiable instruments of such other Person received as payment for ordinary
course of business trade receivables; (vii) any interest rate agreements or
Currency Agreements with an unaffiliated Person otherwise permitted by clause
(iv) or (v) of Section 4.04; (viii) Investments received as consideration for
an Asset Disposition in compliance with Section 4.05; (ix) loans or advances to
employees of the Company or any Restricted Subsidiary in an aggregate amount
not to exceed $1.5 million at any one time outstanding; (x) any Investment in
the Company or any Restricted Subsidiary; (xi) any Investment existing on the
Issue Date and any extension, modification or renewal of any such Investments,
but only to the extent not involving additional advances, contributions or
other Investments of cash or other assets or other increases thereof (other
than as a result of the accrual or accretion of interest or original issue
discount or the issuance of pay-in-kind securities, in each case, pursuant to
the terms of such Investment as in effect on the Issue Date); (xii) additional
Investments having an aggregate fair market value, taken together with all
other Investments made pursuant to this clause (xii) that at the time
outstanding, not to exceed $15.0 million; (xiii) loans and advances to
officers, directors and employees for business-related travel expenses, moving
expenses and other similar expenses, in each case incurred in the ordinary
course of business; and (xiv) Investments the payment for which consists of
Capital Stock of the Company (exclusive of Disqualified Stock);

 

13

 

provided,
however, that the issuance of such Capital Stock is not included in the
calculation set forth in clause (3) of the first paragraph of Section 4.06.

 

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

 

“Preferred Stock,” as applied to the Capital
Stock of any Person, means Capital Stock of such Person of any class or classes
(however designated) that ranks prior, as to the payment of dividends or as to
the distribution of assets upon any voluntary or involuntary liquidation,
dissolution or winding up of such Person, to shares of Capital Stock of any
other class of such Person.

 

“Principal” of any Security means principal of,
and premium, if any, with respect to, such Security.

 

“Private Placement Legend”
means the legend set forth in Section 2.06(g)(i) to be placed on all Securities
issued under this Indenture except where otherwise permitted by the provisions
of this Indenture.

 

“Purchase Date” has the meaning set forth in
the definition of “Offer to Purchase.”

 

“Purchase Money Indebtedness” means
Indebtedness of the Company or any Restricted Subsidiary incurred for the
purpose of financing all or any part of the purchase price or the cost of installation,
construction or improvement of any property (real or personal), including
equipment; provided, however, that the aggregate principal amount
of such Indebtedness does not exceed such purchase price or cost, as
applicable, including any refinancing of such Indebtedness that does not
increase the aggregate principal amount (or accreted amount, if less) thereof
as of the date of refinancing.

 

“Qualified Institutional Buyer” or “QIB”
shall have the meaning specified under Rule 144A under the Securities Act.

 

“Qualified Stock” means any Capital Stock of
the Company other than Disqualified Stock.

 

“Refinance” means refinance, renew, extend,
replace or refund; and “Refinancing” and “Refinanced” have correlative
meanings.

 

“Registration Rights Agreement” means the
Registration Rights Agreement dated as of the date hereof among the Company,
Merrill Lynch & Co., Merrill Lynch, Pierce, Fenner & Smith Incorporated
and Deutsche Bank Securities Inc.

 

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

 

“Regulation S Global Security” means a Legended
Regulation S Global Security or an Unlegended Regulation S Global Security, as
appropriate.

 

14

 

“Restricted Definitive Security” means a
Definitive Security bearing the Private Placement Legend.

 

“Restricted Global Security” means a Global
Security bearing the Private Placement Legend.

 

“Restricted Period” means the 40-day
distribution compliance period as defined in Regulation S.

 

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

 

“Rule 144” means Rule 144 promulgated under the
Securities Act.

 

“Rule 144A” means Rule 144A promulgated under
the Securities Act.

 

“Rule 903” means Rule 903 promulgated under the
Securities Act.

 

“Rule 904” means Rule 904 promulgated under the
Securities Act.

 

“Sale and Lease-Back Transaction” means any
arrangement with any Person providing for the leasing by the Company or any
Restricted Subsidiary of the Company of any real or tangible personal property,
which property has been or is to be sold or transferred by the Company or such
Restricted Subsidiary to such Person in contemplation of such leasing.

 

“SEC” means the Securities and Exchange
Commission.

 

“Securities” means the 7.875% Senior Notes due
2013 issued under this Indenture.

 

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

 

“Senior Credit Facility” means the Loan and
Security Agreement, dated as of November 20, 2001, as amended, among the
Company, Wachovia Bank, National Association, as successor by merger to
Congress Financial Corporation, as Agent, and the lenders party thereto,
including any deferrals, renewals, extensions, replacements, Refinancings or
refundings thereof, or amendments, restatements, modifications or supplements
thereto and any agreement providing therefor whether by or with the same or any
other lender, creditors, or group of creditors or comprised of one or more facilities
or agreements and including related notes, guarantee agreements, security
agreements and other instruments and agreements executed in connection
therewith.

 

“Shelf Registration Statement” has the meaning
set forth in the Registration Rights Agreement.

 

15

 

“Similar Business” means any business related,
ancillary or complementary (as determined in good faith by the Board of
Directors) to the business of the Company and the Restricted Subsidiaries on
the Issue Date.

 

“Subordinated Indebtedness” means any
Indebtedness of the Company or any Guarantor (whether outstanding on the date
hereof or hereafter Incurred) which is by its terms expressly subordinate or
junior in right of payment to the Securities or the Guarantee of such
Guarantor, as the case may be.

 

“Subsidiary” of any Person means (i) a
corporation more than 50% of the outstanding Voting Stock of which is owned,
directly or indirectly, by such Person or by one or more other Subsidiaries of
such Person or by such Person and one or more other Subsidiaries thereof or
(ii) any other Person (other than a corporation) in which such Person, or one
or more other Subsidiaries of such Person or such Person and one or more other
Subsidiaries thereof, directly or indirectly, has at least a majority ownership
and voting power relating to the policies, management and affairs thereof.

 

“TIA” means the Trust Indenture Act of 1939 (15
U.S. Code Sections 77aaa-77bbbb), as in effect on the date of this Indenture,
except as provided in Section 10.03.

 

“Trust Officer” means any officer within the
corporate trust department (or any successor group) of the Trustee including
any vice president, assistant vice president, treasurer or assistant treasurer
or any other officer or assistant officer of the Trustee customarily performing
functions similar to those performed by the persons who at that time shall be
such officers, and also means, with respect to a particular corporate trust
matter, any other officer to whom such trust matter is referred because of his
knowledge of and familiarity with the particular subject, and who shall have
direct responsibility for the administration of this Indenture.

 

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

 

“Unlegended Regulation
S Global Security” means a permanent global Security in the form of Exhibit
A bearing the Global Security Legend, deposited with or on behalf of and
registered in the name of the Depositary or its nominee and issued upon
expiration of the Restricted Period.

 

“Unrestricted
Definitive Security” means one or more Definitive Securities that do not
bear and are not required to bear the Private Placement Legend.

 

“Unrestricted Global Security” means one or
more Global Securities that do not and are not required to bear the Securities
Act Legend.

 

“Unrestricted Subsidiary” means (i) any
Subsidiary of the Company that at the time of determination is designated an
Unrestricted Subsidiary by the Board of Directors in the manner provided below
and (ii) any Subsidiary of an Unrestricted Subsidiary.  Any such designation by the Board of
Directors will be evidenced to the Trustee by promptly filing with the Trustee
a copy of the board resolution giving effect to such designation and an
officers’

 

16

 

certificate certifying
that such designation complied with the foregoing provisions.  The Board of Directors of the Company shall
not designate any Subsidiary of the Company to be an Unrestricted Subsidiary
(a) unless such designation is made in accordance with Section 4.06 and (b) if,
after such designation, (i) the Company or any other Restricted Subsidiary (x)
provides credit support for, or a guarantee of, any Indebtedness of such
Subsidiary (including any undertaking, agreement or instrument evidencing such
Indebtedness) or (y) is directly or contingently liable for any Indebtedness of
such Subsidiary, (ii) a default with respect to any Indebtedness of such
Subsidiary (including the exercise of any right which the holders thereof may
have to take enforcement action against such Subsidiary) would permit (upon
notice, lapse of time or both) any holder of any other Indebtedness of the
Company or any Restricted Subsidiary to declare a default on such other
Indebtedness or cause the payment thereof to be accelerated or payable prior to
its final scheduled maturity or (iii) such Subsidiary owns any Capital Stock of,
or owns or holds any Lien on any property of, any Restricted Subsidiary which
is not a Subsidiary of the Subsidiary to be so designated.  The Board of Directors may redesignate any
Unrestricted Subsidiary to be a Restricted Subsidiary; provided, however,
that (a) no Default shall have occurred and be continuing and (b) all
Indebtedness of such Unrestricted Subsidiary and all Liens on any asset of such
Unrestricted Subsidiary outstanding immediately following such redesignation
would, if Incurred at such time, be permitted to be Incurred under this
Indenture.

 

“U.S. Person”
means a U.S. person as defined in Rule 902(o) under the Securities Act.

 

“Voting Stock” of any Person means the Capital
Stock of such Person which ordinarily has voting power for the election of
directors (or persons performing similar functions) of such Person, whether at
all times or only so long as no senior class of securities has such voting
power by reason of any contingency.

 

“Wholly Owned Subsidiary” means a Restricted
Subsidiary, all of the outstanding Capital Stock or other ownership interests
of which (other than directors’ qualifying shares) shall at the time be owned
by the Company and/or by one or more Wholly Owned Subsidiaries.

 

SECTION 1.02.   Other Definitions.

 

	
  Term

  	
   

  	
  Defined in Section

  
	
  Authentication Order

  	
   

  	
  2.02

  
	
  Bankruptcy Law

  	
   

  	
  6.01

  
	
  Change of Control

  	
   

  	
  4.14

  
	
  Custodian

  	
   

  	
  6.01

  
	
  Event of Default

  	
   

  	
  6.01

  
	
  Funding Guarantor

  	
   

  	
  11.05

  
	
  Net Proceeds Utilization Date

  	
   

  	
  4.05

  
	
  offshore transaction

  	
   

  	
  2.06

  
	
  Paying Agent

  	
   

  	
  2.03

  
	
  Registrar

  	
   

  	
  2.03

  
	
  Required Filing Dates

  	
   

  	
  4.12

  
	
  Restricted Payment

  	
   

  	
  4.06

  

 

17

 

	
  Surviving Entity

  	
   

  	
  5.01

  
	
  Unutilized Net Available Proceeds

  	
   

  	
  4.05

  

 

SECTION 1.03.   Incorporation
by Reference of Trust Indenture Act.

 

Whenever this Indenture refers to a provision of the
TIA, the provision is incorporated by reference in and made a part of this
Indenture.  The following TIA terms used
in this Indenture have the following meanings:

 

“Commission” means the Securities and Exchange
Commission.

 

“indenture securities” means the Securities.

 

“indenture security holder” means a Holder or
Securityholder.

 

“indenture to be qualified” means this
Indenture.

 

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

 

“obligor” on the indenture securities means the
Company or any other obligor on the Securities.

 

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

 

SECTION 1.04.   Rules
of Construction.

 

Unless the context otherwise requires:

 

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

 

(2)                                  an
accounting term not otherwise defined has the meaning assigned to it in
accordance with generally accepted accounting principles in effect from time to
time, and any other reference in this indenture to “generally accepted
accounting principles” refers to GAAP;

 

(3)                                  “or”
is not exclusive;

 

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

 

(5)                                  Section
and Article references are to sections and articles of this Indenture;

 

(6)                                  provisions
apply to successive events and transactions; and

 

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

 

18

 

ARTICLE TWO

 

THE SECURITIES

 

SECTION 2.01.   Form and Dating.

 

(a)                                  General.  The Securities and the Trustee’s certificate
of authentication shall be substantially in the form of Exhibit A.  The Securities may have notations, legends or
endorsements required by law, stock exchange rule or usage.  Each Security shall be dated the date of its
authentication.  The Securities shall be
issued in registered form without interest coupons in minimum denominations of
$1,000 and integral multiples of $1,000 in excess thereof.

 

The terms and provisions contained in the Securities
shall constitute, and are hereby expressly made, a part of this Indenture, and
the Company, the Guarantors, if any, and the Trustee, by their execution and
delivery of this Indenture, expressly agree to such terms and provisions and to
be bound thereby.  However, to the extent
any provision of any Security conflicts with the express provisions of this
Indenture, the provisions of this Indenture shall govern and be controlling.

 

(b)                                 Global Securities.  Securities issued in global form shall be
substantially in the form of Exhibit A (and shall include the Global
Security Legend thereon and the “Schedule of Exchanges of Interests in the
Global Security” attached thereto). 
Securities issued in definitive form shall be substantially in the form
of Exhibit A (but without the Global Security Legend thereon and without
the “Schedule of Exchanges of Interests in the Global Security” attached
thereto).  Each Global Security shall
represent such of the outstanding Securities as shall be specified therein, and
each shall provide that it represents the aggregate principal amount of
outstanding Securities from time to time endorsed thereon and that the
aggregate principal amount of outstanding Securities represented thereby may
from time to time be reduced or increased, as appropriate, to reflect exchanges
and redemptions.  Any endorsement of a
Global Security to reflect the amount of any increase or decrease in the
aggregate principal amount of outstanding Securities represented thereby shall
be made by the Trustee or, if the Custodian and the Trustee are not the same
Person, by the Custodian at the direction of the Trustee, in accordance with
instructions given by the Holder thereof as required by Section 2.06 of this
Indenture.

 

(c)                                  Regulation S Global Securities.  Securities offered and sold in reliance on
Regulation S shall be issued initially in the form of the Legended
Regulation S Global Security, which shall be deposited on behalf of the
purchasers of the Securities represented thereby with the Trustee, as custodian
for DTC in the City of New York, and registered in the name of the Depositary
or the nominee of the Depositary for the accounts of designated agents holding
on behalf of Euroclear or Clearstream, duly executed by the Company and
authenticated by the Trustee as hereinafter provided.  Following the termination of the Restricted
Period, beneficial interests in the Legended Regulation S Global Security may
be exchanged for beneficial interests in Unlegended Regulation S Global
Securities pursuant to Section 2.06 and the Applicable Procedures.  Simultaneously with the authentication of
Unlegended Regulation S Global Securities, the Trustee shall cancel the
Legended Regulation S Global Security. 
The aggregate principal amount of the Regulation S Global Securities may
from time to time be increased or

 

19

 

decreased by adjustments
made on the records of the Trustee and the Depositary or its nominee, as the
case may be, in connection with transfers of interest as hereinafter provided.

 

(d)                                 Euroclear and Clearstream
Procedures Applicable.  The provisions of the “Operating Procedures
of the Euroclear System” and “Terms and Conditions Governing Use of Euroclear”
and the “General Terms and Conditions of Clearstream Banking” and “Customer
Handbook” of Clearstream shall be applicable to transfers of beneficial
interests in the Regulation S Global Securities that are held by Participants
through Euroclear or Clearstream.

 

SECTION 2.02.   Execution
and Authentication.

 

At least one Officer of the Company shall sign the Securities
for the Company by manual or facsimile signature.

 

If an Officer whose signature is on a Security no
longer holds that office at the time a Security is authenticated, the Security
shall nevertheless be valid.

 

A Security shall not be valid until authenticated by
the manual signature of the Trustee. 
Such signature shall be conclusive evidence that the Security has been
authenticated under this Indenture.

 

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

 

The Company may, subject to Article Four of this
Indenture and applicable law, issue Additional Securities under this Indenture,
including Exchange Securities.  The
Securities issued on the Issue Date and any Additional Securities subsequently
issued shall be treated as a single class for all purposes under this
Indenture.

 

At any time and from time to time after the execution
of this Indenture, the Trustee shall, upon receipt of a written order of the
Company signed by an Officer of the Company (an “Authentication Order”),
authenticate Securities for original issue in an aggregate principal amount
specified in such Authentication Order. 
The Authentication Order shall specify the amount of Securities to be
authenticated and the date on which the Securities are to be authenticated.

 

The Trustee may appoint an authenticating agent
acceptable to the Company to authenticate Securities.  An authenticating agent may authenticate
Securities whenever the Trustee may do so. 
Each reference in this Indenture to authentication by the Trustee
includes authentication by such agent. 
An authenticating agent has the same rights as an Agent to deal with
Holders or an Affiliate of the Company.

 

SECTION 2.03.   Registrar
and Paying Agent.

 

The Company shall maintain an office or agency where
Securities may be presented for registration of transfer or for exchange (“Registrar”)
and an office or agency where Securities may be presented for payment (“Paying
Agent”).  The Company may have one or

 

20

 

more co-Registrars and
one or more additional paying agents. 
The term “Paying Agent” includes any additional paying agent.

 

The Company shall enter into an appropriate agency
agreement with any Agent not a party to this Indenture.  The agreement shall implement the provisions
of this Indenture that relate to such Agent and shall, if required, incorporate
the provisions of the TIA.  The Company
shall notify the Trustee in writing of the name and address of any such
Agent.  If the Company fails to maintain
a Registrar or Paying Agent, the Trustee shall act as such and shall be
entitled to appropriate compensation in accordance with the provisions of
Section 7.07.

 

The Company initially appoints the Trustee as Registrar
and Paying Agent.  The Company shall give
written notice to the Trustee in the event that the Company decides to act as
Registrar.  None of the Company, its
Subsidiaries or any of their Affiliates may act as Paying Agent.

 

The Company initially appoints DTC to act as
Depositary with respect to the Global Securities.

 

SECTION 2.04.   Paying
Agent to Hold Money in Trust.

 

The Company shall require each Paying Agent to agree
in writing to hold in trust for the benefit of Securityholders or the Trustee all
money held by the Paying Agent for the payment of principal of or interest on
the Securities (whether such money has been paid to it by the Company or any
other obligor on the Securities), and the Company and the Paying Agent shall
each notify the Trustee in writing of any default by the Company (or any other
obligor on the Securities) in making any such payment.  The Company at any time may require a Paying
Agent to pay all money held by it to the Trustee and account for any funds
disbursed and the Trustee may at any time during the continuance of any payment
default, upon written request to a Paying Agent, require such Paying Agent to
pay all money held by it to the Trustee and to account for any funds
disbursed.  Upon making such payment the
Paying Agent shall have no further liability for the money delivered to the
Trustee.

 

SECTION 2.05.   Securityholder
Lists.

 

The Trustee shall preserve in as current a form as is
reasonably practicable the most recent list available to it of the names and
addresses of Securityholders.  If the
Trustee is not the Registrar, the Company shall furnish to the Trustee at least
five Business Days before each Interest Payment Date and at such other times as
the Trustee may request in writing a list in such form and as of such date as
the Trustee may reasonably require of the names and addresses of
Securityholders.

 

SECTION 2.06.   Transfer
and Exchange.

 

(a)                                  Transfer and Exchange of Global
Securities.  A Global Security may not be transferred as a
whole except by the Depositary to a nominee of the Depositary, by a nominee of
the Depositary to the Depositary or to another nominee of the Depositary, or by
the Depositary or any such nominee to a successor Depositary or a nominee of
such successor Depositary.  All Global
Securities shall be exchanged by the Company for Definitive Securities

 

21

 

if (i) DTC (A) notifies
the Company that it is unwilling or unable to continue as Depositary for the
Global Securities and the Company fails to appoint a successor Depositary
within 90 days after receiving such notice or (B) has ceased to be a clearing
agency registered under the Exchange Act and the Company fails to appoint a
successor Depositary within 90 days after becoming aware of such condition;
(ii) the Company, at its option, notifies the Trustee in writing that it elects
to cause the issuance of Definitive Securities; provided that in no
event shall the Legended Regulation S Global Security be exchanged by the
Company for Definitive Securities other than in accordance with Section
2.06(c)(ii); or (iii) there shall have occurred and be continuing a Default or
Event of Default with respect to the Securities.  Upon the occurrence of any of the preceding
events in (i), (ii) or (iii) above, Definitive Securities shall be issued in
such names as the Depositary shall instruct the Trustee.  Global Securities also may be exchanged or
replaced, in whole or in part, as provided in Sections 2.07 and 2.10.  Every Security authenticated and delivered in
exchange for, or in lieu of, a Global Security or any portion thereof, pursuant
to this Section 2.06 or Sections 2.07 or 2.10, shall be authenticated and
delivered in the form of, and shall be, a Global Security.  A Global Security may not be exchanged for
another Security other than as provided in this Section 2.06(a); however,
beneficial interests in a Global Security may be transferred and exchanged as
provided in Section 2.06(b), (c) or (f).

 

(b)                                 Transfer and Exchange of
Beneficial Interests in the Global Securities.  The transfer and
exchange of beneficial interests in the Global Securities shall be effected
through the Depositary, in accordance with the provisions of this Indenture and
the Applicable Procedures.  Beneficial
interests in the Restricted Global Securities shall be subject to restrictions
on transfer comparable to those set forth herein to the extent required by the
Securities Act.  Transfers of beneficial
interests in the Global Securities also shall require compliance with either
subparagraph (i) or (ii) below, as applicable, as well as one or more of the
other following subparagraphs, as applicable:

 

(i)                                     Transfer of Beneficial Interests in the Same
Global Security.  Beneficial
interests in any Restricted Global Security may be transferred to Persons who
take delivery thereof in the form of a beneficial interest in the same
Restricted Global Security in accordance with the transfer restrictions set
forth in the Private Placement Legend; provided, however,
that, prior to the expiration of the Restricted Period, transfers of beneficial
interests in the Legended Regulation S Global Security may not be made to a
U.S. Person or for the account or benefit of a U.S. Person (other than an
Initial Purchaser).  Beneficial interests
in any Unrestricted Global Security may be transferred to Persons who take
delivery thereof in the form of a beneficial interest in an Unrestricted Global
Security.  No written orders or
instructions shall be required to be delivered to the Registrar to effect the
transfers described in this Section 2.06(b)(i).

 

(ii)                                  All Other Transfers and Exchanges of
Beneficial Interests in Global Securities.  In connection with all transfers and
exchanges of beneficial interests that are not subject to Section 2.06(b)(i)
above, the transferor of such beneficial interest must deliver to the Registrar
either (A) (1) a written order from a Participant or an Indirect Participant
given to the Depositary in accordance with the Applicable Procedures directing
the Depositary to credit or cause to be credited a beneficial interest in
another Global Security in an amount equal to the beneficial interest to be
transferred or

 

22

 

exchanged and (2) instructions given in
accordance with the Applicable Procedures containing information regarding the
Participant account to be credited with such increase or (B) (1) a written
order from a Participant or an Indirect Participant given to the Depositary in
accordance with the Applicable Procedures directing the Depositary to cause to
be issued a Definitive Security in an amount equal to the beneficial interest
to be transferred or exchanged and (2) instructions given by the Depositary to
the Registrar containing information regarding the Person in whose name such
Definitive Security shall be registered to effect the transfer or exchange
referred to in (1) above; provided that in no event shall Definitive Securities be
issued upon the transfer or exchange of beneficial interests in the Legended
Regulation S Global Security other than in accordance with Section
2.06(c)(ii).  Upon consummation of an
Exchange Offer by the Company in accordance with Section 2.06(f), the
requirements of this Section 2.06(b)(ii) shall be deemed to have been satisfied
upon receipt by the Registrar of the instructions contained in the Letter of
Transmittal delivered by the holder of such beneficial interests in the
Restricted Global Securities.  Upon
satisfaction of all of the requirements for transfer or exchange of beneficial
interests in Global Securities contained in this Indenture and the Securities
or otherwise applicable under the Securities Act, the Trustee shall adjust the
principal amount at maturity of the relevant Global Securities pursuant to
Section 2.06(i).

 

(iii)                               Transfer of Beneficial Interests to Another
Restricted Global Security.  A
beneficial interest in any Restricted Global Security may be transferred to a
Person who takes delivery thereof in the form of a beneficial interest in
another Restricted Global Security if the transfer complies with the
requirements of Section 2.06(b)(ii) above and the Registrar receives the
following:

 

(A)                              if
the transferee shall take delivery in the form of a beneficial interest in the
144A Global Security, then the transferor must deliver a certificate in the
form of Exhibit B, including the certifications in item (1) thereof; and

 

(B)                                if
the transferee shall take delivery in the form of a beneficial interest in a
Legended Regulation S Global Security, then the transferor must deliver a
certificate in the form of Exhibit B, including the certifications in
item (2) thereof.

 

(iv)                              Transfer
and Exchange of Beneficial Interests in a Restricted Global Security for
Beneficial Interests in an Unrestricted Global Security.  A beneficial interest in any Restricted
Global Security may be exchanged by any Holder thereof for a beneficial
interest in an Unrestricted Global Security or transferred to a Person who
takes delivery thereof in the form of a beneficial interest in an Unrestricted
Global Security if the exchange or transfer complies with the requirements of
Section 2.06(b)(ii) above and:

 

(A)                              such
exchange or transfer is effected pursuant to the Exchange Offer in accordance
with the Registration Rights Agreement and the Holder of the beneficial interest
to be transferred, in the case of an exchange, or the transferee, in the case
of a transfer, certifies in the applicable Letter of Transmittal that (1) it is
not an affiliate (as defined in Rule 144) of the Company, (2) it is not engaged

 

23

 

 

in, and does not
intend to engage in, and has no arrangement or understanding with any Person to
participate in a distribution of the Exchange Securities to be issued in the
Exchange Offer and (3) it is acquiring the Exchange Securities in its
ordinary course of business;

 

(B)                                such
transfer is effected pursuant to the Shelf Registration Statement in accordance
with the Registration Rights Agreement;

 

(C)                                such
transfer is effected by a Broker-Dealer pursuant to the Exchange Offer
Registration Statement in accordance with the Registration Rights Agreement; or

 

(D)                               the
Registrar receives the following:

 

(1)                                  if the holder of such beneficial
interest in a Restricted Global Security proposes to exchange such beneficial
interest for a beneficial interest in an Unrestricted Global Security, a
certificate from such holder in the form of Exhibit C, including
the certifications in item (1)(a) thereof; or

 

(2)                                  if the holder of such beneficial
interest in a Restricted Global Security proposes to transfer such beneficial interest
to a Person who shall take delivery thereof in the form of a beneficial
interest in an Unrestricted Global Security, a certificate from such holder in
the form of Exhibit B, including the certifications in item (4) thereof;

 

and, in each such case set forth in this subparagraph
(D), if the Registrar or the Company so requests or if the Applicable
Procedures so require, an opinion of counsel in form reasonably acceptable to
the Registrar and the Company to the effect that such exchange or transfer is
in compliance with the Securities Act and that the restrictions on transfer
contained herein and in the Private Placement Legend are no longer required in
order to maintain compliance with the Securities Act.

 

If any such transfer is effected pursuant to
subparagraph (B) or (D) above at a time when an Unrestricted Global
Security has not yet been issued, the Company shall issue and, upon receipt of
an Authentication Order in accordance with Section 2.02, the Trustee shall
authenticate one or more Unrestricted Global Securities in an aggregate
principal amount equal to the aggregate principal amount of beneficial
interests transferred pursuant to subparagraph (B) or (D) above.

 

Beneficial interests in an Unrestricted Global
Security cannot be exchanged for, or transferred to Persons who take delivery
thereof in the form of, a beneficial interest in a Restricted Global Security.

 

24

 

(c)                                  Transfer or Exchange of
Beneficial Interests for Definitive Securities.

 

(i)                                     Beneficial
Interests in Restricted Global Securities to Restricted Definitive Securities.  If any holder of a beneficial interest in a
Restricted Global Security proposes to exchange such beneficial interest for a
Restricted Definitive Security or to transfer such beneficial interest to a
Person who takes delivery thereof in the form of a Restricted Definitive
Security, then, upon receipt by the Registrar of the following documentation:

 

(A)                              if
the holder of such beneficial interest in a Restricted Global Security proposes
to exchange such beneficial interest for a Restricted Definitive Security, a
certificate from such holder in the form of Exhibit C, including
the certifications in item (2)(a) thereof;

 

(B)                                if
such beneficial interest is being transferred to a QIB in accordance with Rule 144A
under the Securities Act, a certificate to the effect set forth in Exhibit B,
including the certifications in item (1) thereof;

 

(C)                                if
such beneficial interest is being transferred to an Institutional Accredited
Investor in reliance on an exemption from the registration requirements of the
Securities Act other than that listed in subparagraph (B) above, a
certificate to the effect set forth in Exhibit B hereto, including
the certifications, certificates and Opinion of Counsel required by item (3) thereof,
if applicable; or

 

(D)                               if
such beneficial interest is being transferred to the Company or any of its
Subsidiaries, a certificate to the effect set forth in Exhibit B,
including the certifications in item (3)(a) thereof,

 

the
Trustee shall cause the aggregate principal amount of the applicable Global
Security to be reduced accordingly pursuant to Section 2.06(i) hereof,
and the Company shall execute and the Trustee shall authenticate and deliver to
the Person designated in the instructions a Definitive Security in the
appropriate principal amount.  Any
Definitive Security issued in exchange for a beneficial interest in a
Restricted Global Security pursuant to this Section 2.06(c)(i) shall
be registered in such name or names and in such authorized denomination or
denominations as the holder of such beneficial interest shall instruct the
Registrar through instructions from the Depositary and the Participant or
Indirect Participant.  The Trustee shall
deliver such Definitive Securities to the Persons in whose names such
Securities are so registered.  Any
Definitive Security issued in exchange for a beneficial interest in a
Restricted Global Security pursuant to this Section 2.06(c)(i) shall
bear the Private Placement Legend and shall be subject to all restrictions on
transfer contained therein.

 

(ii)                                  Beneficial Interests in Legended Regulation
S Global Security to Definitive Securities.  A beneficial interest in the Legended
Regulation S Global Security may not be exchanged for a Definitive Security or
transferred to a Person who takes delivery thereof in the form of a Definitive
Security prior to the expiration of the Restricted Period, except in the case
of a transfer pursuant to an exemption from the registration requirements of
the Securities Act other than Rule 903 or Rule 904.

 

25

 

(iii)                               Beneficial Interests in Restricted Global
Securities to Unrestricted Definitive Securities.  A holder of a beneficial interest in a Restricted
Global Security may exchange such beneficial interest for an Unrestricted
Definitive Security or may transfer such beneficial interest to a Person who
takes delivery thereof in the form of an Unrestricted Definitive Security only
if:

 

(A)                              such
exchange or transfer is effected pursuant to the Exchange Offer in accordance
with the Registration Rights Agreement and the holder of such beneficial
interest, in the case of an exchange, or the transferee, in the case of a
transfer, certifies in the applicable Letter of Transmittal that (1) it is
not an affiliate (as defined in Rule 144) of the Company, (2) it is
not engaged in, and does not intend to engage in, and has no arrangement or
understanding with any Person to participate in, a distribution of the Exchange
Securities to be issued in the Exchange Offer and (3) it is acquiring the
Exchange Securities in its ordinary course of business;

 

(B)                                such
transfer is effected pursuant to the Shelf Registration Statement in accordance
with the Registration Rights Agreement;

 

(C)                                such
transfer is effected by a Broker-Dealer pursuant to the Exchange Offer
Registration Statement in accordance with the Registration Rights Agreement; or

 

(D)                               the
Registrar receives the following:

 

(1)                                  if the holder of such beneficial
interest in a Restricted Global Security proposes to exchange such beneficial
interest for a Definitive Security that does not bear the Private Placement
Legend, a certificate from such Holder in the form of Exhibit C,
including the certifications in item (1)(b) thereof; or

 

(2)                                  if the holder of such beneficial
interest in a Restricted Global Security proposes to transfer such beneficial
interest to a Person who shall take delivery thereof in the form of a
Definitive Security that does not bear the Private Placement Legend, a
certificate from such Holder in the form of Exhibit B, including
the certifications in item (4) thereof;

 

and, in each such case set forth in this subparagraph
(D), if the Registrar or the Company so requests or if the Applicable Procedures
so require, an opinion of  counsel in
form reasonably acceptable to the Registrar and the Company to the effect that
such exchange or transfer is in compliance with the Securities Act and that the
restrictions on transfer contained herein and in the Private Placement Legend
are no longer required in order to maintain compliance with the Securities Act.

 

(iv)                              Beneficial Interests in Unrestricted Global
Securities to Unrestricted Definitive Securities.  If any holder of a beneficial interest in an
Unrestricted Global Security proposes to exchange such beneficial interest for
a Definitive Security or to

 

26

 

transfer such beneficial interest to a Person
who takes delivery thereof in the form of a Definitive Security, then, upon
satisfaction of the conditions set forth in Section 2.06(b)(ii), the
Trustee shall cause the aggregate principal amount of the applicable Global
Security to be reduced accordingly pursuant to Section 2.06(i), and the
Company shall execute and the Trustee shall authenticate and deliver to the
Person designated in the instructions a Definitive Security in the appropriate
principal amount.  Any Definitive
Security issued in exchange for a beneficial interest pursuant to this Section 2.06(c)(iv) shall
be registered in such name or names and in such authorized denomination or
denominations as the holder of such beneficial interest shall instruct the
Registrar through instructions from the Depositary and the Participant or
Indirect Participant.  The Trustee shall
deliver such Definitive Securities to the Persons in whose names such
Securities are so registered.  Any
Definitive Security issued in exchange for a beneficial interest pursuant to
this Section 2.06(c)(iv) shall not bear the Private Placement Legend.

 

(d)                                 Transfer and Exchange of
Definitive Securities for Beneficial Interests.

 

(i)                                     Restricted Definitive Securities to
Beneficial Interests in Restricted Global Securities.  If any Holder of a Restricted Definitive
Security proposes to exchange such Security for a beneficial interest in a
Restricted Global Security or to transfer such Restricted Definitive Securities
to a Person who takes delivery thereof in the form of a beneficial interest in
a Restricted Global Security, then, upon receipt by the Registrar of the
following documentation:

 

(A)                              if
the Holder of such Restricted Definitive Security proposes to exchange such
Security for a beneficial interest in a Restricted Global Security, a
certificate from such Holder in the form of Exhibit C, including
the certifications in item (2)(b) thereof;

 

(B)                                if
such Restricted Definitive Security is being transferred to a QIB in accordance
with Rule 144A, a certificate to the effect set forth in Exhibit B,
including the certifications in item (1) thereof;

 

(C)                                if
such Restricted Definitive Security is being transferred to a Non-U.S. Person
in an “offshore transaction” in accordance with Rule 903 or Rule 904,
a certificate to the effect set forth in Exhibit B, including the
certifications in item (2) thereof; or

 

(D)                               if
such Restricted Definitive Security is being transferred to the Company or any
of its Subsidiaries, a certificate to the effect set forth in Exhibit B,
including the certifications in item (3)(a) thereof,

 

the
Trustee shall cancel the Restricted Definitive Security, and increase or cause
to be increased the aggregate principal amount of, in the case of clause (A) above,
the appropriate Restricted Global Security, in the case of clause (B) above,
the 144A Global Security, and in the case of clause (C) above, the
Regulation S Global Security.

 

(ii)                                  Restricted Definitive Securities to
Beneficial Interests in Unrestricted Global Securities.  A Holder of a Restricted Definitive Security
may exchange such

 

27

 

Security for a beneficial interest in an
Unrestricted Global Security or transfer such Restricted Definitive Security to
a Person who takes delivery thereof in the form of a beneficial interest in an
Unrestricted Global Security only if:

 

(A)                              such
exchange or transfer is effected pursuant to the Exchange Offer in accordance
with the Registration Rights Agreement and the Holder, in the case of an
exchange, or the transferee, in the case of a transfer, certifies in the
applicable Letter of Transmittal (1) it is not an affiliate (as defined in
Rule 144) of the Company, (2) it is not engaged in, and does not
intend to engage in, and has no arrangement or understanding with any Person to
participate in, a distribution of the Exchange Securities to be issued in the
Exchange Offer and (3) it is acquiring the Exchange Securities in its
ordinary course of business;

 

(B)                                such
transfer is effected pursuant to the Shelf Registration Statement in accordance
with the Registration Rights Agreement;

 

(C)                                such
transfer is effected by a Broker-Dealer pursuant to the Exchange Offer
Registration Statement in accordance with the Registration Rights Agreement; or

 

(D)                               the
Registrar receives the following:

 

(1)                                  if the Holder of such Restricted
Definitive Security proposes to exchange such Security for a beneficial
interest in the Unrestricted Global Security, a certificate from such Holder in
the form of Exhibit C, including the certifications in item (1)(c) thereof;
or

 

(2)                                  if the Holder of such Restricted
Definitive Security proposes to transfer such Security to a Person who shall
take delivery thereof in the form of a beneficial interest in the Unrestricted
Global Security, a certificate from such Holder in the form of Exhibit B,
including the certifications in item (4) thereof;

 

and, in each such
case set forth in this subparagraph (D), if the Registrar or the Company so
requests or if the Applicable Procedures so require, an opinion of counsel in
form reasonably acceptable to the Registrar and the Company to the effect that
such exchange or transfer is in compliance with the Securities Act and that the
restrictions on transfer contained herein and in the Private Placement Legend
are no longer required in order to maintain compliance with the Securities Act.

 

Upon satisfaction of the conditions of any of the subparagraphs in this
Section 2.06(d)(ii), the Trustee shall cancel the Definitive Securities
and increase or cause to be increased the aggregate principal amount of the
Unrestricted Global Security.

 

(iii)                               Unrestricted Definitive Securities to
Beneficial Interests in Unrestricted Global Securities.  A Holder of an Unrestricted Definitive
Security may exchange such Security for a beneficial interest in an
Unrestricted Global Security or transfer such

 

28

 

Unrestricted Definitive Security to a Person
who takes delivery thereof in the form of a beneficial interest in an
Unrestricted Global Security at any time. 
Upon receipt of a request for such an exchange or transfer, the Trustee
shall cancel the applicable Unrestricted Definitive Security and increase or
cause to be increased the aggregate principal amount of one of the Unrestricted
Global Securities.

 

If any such exchange or transfer from a Definitive Security to a beneficial
interest is effected pursuant to subparagraphs (ii)(B), (ii)(D) or (iii) of
this Section 2.06(d) above at a time when an Unrestricted Global
Security has not yet been issued, the Company shall issue and, upon receipt of
an Authentication Order in accordance with Section 2.02, the Trustee shall
authenticate one or more Unrestricted Global Securities in an aggregate
principal amount equal to the principal amount of Definitive Securities so
transferred.

 

(e)                                  Transfer and Exchange of
Definitive Securities for Definitive Securities.  Upon request by a Holder of Definitive
Securities and such Holder’s compliance with the provisions of this Section 2.06(e),
the Registrar shall register the transfer or exchange of Definitive
Securities.  Prior to such registration
of transfer or exchange, the requesting Holder shall present or surrender to
the Registrar the Definitive Securities duly endorsed or accompanied by a
written instruction of transfer in form satisfactory to the Registrar duly
executed by such Holder or by its attorney, duly authorized in writing.  In addition, the requesting Holder shall
provide any additional certifications, documents and information, as
applicable, required pursuant to the following provisions of this Section 2.06(e).

 

(i)                                     Restricted Definitive Securities to
Restricted Definitive Securities. 
Any Restricted Definitive Security may be transferred to and registered
in the name of Persons who take delivery thereof in the form of a Restricted
Definitive Security if the Registrar receives the following:

 

(A)                              if
the transfer shall be made pursuant to Rule 144A, then the transferor must
deliver a certificate in the form of Exhibit B, including the
certifications in item (1) thereof; and

 

(B)                                if
the transfer shall be made pursuant to any other exemption from the
registration requirements of the Securities Act, then the transferor must
deliver a certificate in the form of Exhibit B, including the
certifications, certificates and Opinion of Counsel required by item (3) thereof,
if applicable.

 

(ii)                                  Restricted Definitive Securities to
Unrestricted Definitive Securities. 
Any Restricted Definitive Security may be exchanged by the Holder
thereof for an Unrestricted Definitive Security or transferred to a Person or
Persons who take delivery thereof in the form of an Unrestricted Definitive
Security if:

 

(A)                              such
exchange or transfer is effected pursuant to the Exchange Offer in accordance
with the Registration Rights Agreement and the Holder, in the case of an
exchange, or the transferee, in the case of a transfer, certifies in the
applicable Letter of Transmittal that (1) it is not an affiliate (as
defined in Rule 144) of the Company, (2) it is not engaged in, and
does not intend to engage in,

 

29

 

and has no
arrangement or understanding with any Person to participate in, a distribution
of the Exchange Securities to be issued in the Exchange Offer and (3) it
is acquiring the Exchange Securities in its ordinary course of business;

 

(B)                                any
such transfer is effected pursuant to the Shelf Registration Statement in
accordance with the Registration Rights Agreement;

 

(C)                                any
such transfer is effected by a Broker-Dealer pursuant to the Exchange Offer
Registration Statement in accordance with the Registration Rights Agreement; or

 

(D)                               the
Registrar receives the following:

 

(1)                                  if the Holder of such Restricted
Definitive Security proposes to exchange such Security for an Unrestricted
Definitive Security, a certificate from such Holder in the form of Exhibit C,
including the certifications in item (1)(d) thereof; or

 

(2)                                  if the Holder of such Restricted
Definitive Security proposes to transfer such Security to a Person who shall
take delivery thereof in the form of an Unrestricted Definitive Security, a
certificate from such Holder in the form of Exhibit B, including
the certifications in item (4) thereof;

 

and, in each such
case set forth in this subparagraph (D), if the Registrar so requests, an
opinion of counsel in form reasonably acceptable to the Company to the effect
that such exchange or transfer is in compliance with the Securities Act and
that the restrictions on transfer contained herein and in the Private Placement
Legend are no longer required in order to maintain compliance with the
Securities Act.

 

(iii)                               Unrestricted Definitive Securities to
Unrestricted Definitive Securities. 
A Holder of Unrestricted Definitive Securities may transfer such
Securities to a Person who takes delivery thereof in the form of an
Unrestricted Definitive Security.  Upon
receipt of a request to register such a transfer, the Registrar shall register
the Unrestricted Definitive Securities pursuant to the instructions from the
Holder thereof.

 

(f)                                    Exchange Offer.  Upon the occurrence of the Exchange Offer in
accordance with the Registration Rights Agreement, the Company shall issue and,
upon receipt of an Authentication Order in accordance with Section 2.02,
the Trustee shall authenticate (i) one or more Unrestricted Global
Securities in an aggregate principal amount equal to the principal amount of
the beneficial interests in the Restricted Global Securities tendered for
acceptance by Persons that certify in the applicable Letters of Transmittal
that (x) they are not affiliates (as defined in Rule 144) of the Company,
(y) they are not engaged in, and do not intend to engage in, and have no
arrangement or understanding with any Person to participate in, a distribution
of the Exchange Securities to be issued in the Exchange Offer and (z) they are
acquiring the Exchange Securities in their ordinary course of business and (ii) Unrestricted
Definitive Securities in an aggregate principal amount equal to the principal
amount of the Restricted

 

30

 

Definitive Securities
accepted for exchange in the Exchange Offer. 
Concurrently with the issuance of such Securities, the Trustee shall
cause the aggregate principal amount of the applicable Restricted Global
Securities to be reduced accordingly, and the Company shall execute and the
Trustee shall authenticate and deliver to the Persons designated by the Holders
of Restricted Global Securities so accepted Unrestricted Global Securities in
the appropriate principal amount.

 

(g)                                 Legends.  The following legends shall appear on the
face of all Global Securities and Definitive Securities issued under this
Indenture unless specifically stated otherwise in the applicable provisions of
this Indenture.

 

(i)                                     Private Placement Legend.  Except as permitted below, each Global
Security and each Definitive Security (and all Securities issued in exchange
therefor or substitution thereof) shall bear the legend in substantially the
following form:

 

“THE SECURITIES EVIDENCED HEREBY HAVE NOT BEEN
REGISTERED UNDER THE U.S. SECURITIES ACT OF 1933, AS AMENDED (THE “SECURITIES ACT”),
OR ANY STATE SECURITIES LAWS.  NEITHER
THIS SECURITY NOR ANY INTEREST OR PARTICIPATION HEREIN MAY BE REOFFERED,
SOLD, ASSIGNED, TRANSFERRED, PLEDGED, ENCUMBERED OR OTHERWISE DISPOSED OF IN
THE ABSENCE OF SUCH REGISTRATION OR UNLESS SUCH TRANSACTION IS EXEMPT FROM, OR
NOT SUBJECT TO, REGISTRATION AS SET FORTH BELOW.  BY ITS ACQUISITION HEREOF, THE HOLDER (1) REPRESENTS
THAT (A) IT IS A “QUALIFIED INSTITUTIONAL BUYER” (AS DEFINED IN RULE 144A
UNDER THE SECURITIES ACT (“RULE 144A”)) OR (B) IT IS NOT A U.S. PERSON AND
IS ACQUIRING THIS SECURITY IN AN OFFSHORE TRANSACTION, (2) AGREES TO
OFFER, SELL OR OTHERWISE TRANSFER SUCH SECURITY PRIOR TO THE DATE WHICH IS TWO
YEARS AFTER THE LATER OF THE ORIGINAL ISSUE DATE HEREOF AND THE LAST DATE ON
WHICH THE COMPANY OR ANY AFFILIATE OF THE COMPANY WAS THE OWNER OF THIS
SECURITY (OR ANY PREDECESSOR OF THIS SECURITY) ONLY (A) TO THE COMPANY, (B) PURSUANT
TO A REGISTRATION STATEMENT WHICH HAS BEEN DECLARED EFFECTIVE UNDER THE
SECURITIES ACT, (C) FOR SO LONG AS THE SECURITIES ARE ELIGIBLE FOR RESALE
PURSUANT TO RULE 144A INSIDE THE UNITED STATES, TO A PERSON IT REASONABLY
BELIEVES IS A “QUALIFIED INSTITUTIONAL BUYER” AS DEFINED IN RULE 144A THAT
PURCHASES FOR ITS OWN ACCOUNT OR FOR THE ACCOUNT OF A QUALIFIED INSTITUTIONAL
BUYER TO WHOM NOTICE IS GIVEN THAT THE TRANSFER IS BEING MADE IN RELIANCE ON
RULE 144A, (D) OUTSIDE THE UNITED STATES PURSUANT TO OFFERS AND SALES TO
NON-U.S. PERSONS IN AN OFFSHORE TRANSACTION WITHIN THE MEANING OF REGULATION S
UNDER THE SECURITIES ACT, (E) TO AN INSTITUTIONAL

 

31

 

ACCREDITED INVESTOR IN A TRANSACTION EXEMPT FROM THE
REGISTRATION REQUIREMENTS OF THE SECURITIES ACT, OR (F) PURSUANT TO
ANOTHER AVAILABLE EXEMPTION FROM THE REGISTRATION REQUIREMENTS OF THE
SECURITIES ACT, SUBJECT TO THE COMPANY’S AND THE TRUSTEE’S RIGHT PRIOR TO ANY
SUCH OFFER, SALE OR TRANSFER (I) PURSUANT TO CLAUSES (D), (E) OR (F) TO
REQUIRE THE DELIVERY OF AN OPINION OF COUNSEL, CERTIFICATION AND/OR OTHER
INFORMATION SATISFACTORY TO EACH OF THEM, AND (II) IN EACH OF THE FOREGOING
CASES, TO REQUIRE THAT A CERTIFICATE OF TRANSFER IN THE FORM APPEARING ON
THE OTHER SIDE OF THIS SECURITY IS COMPLETED AND DELIVERED BY THE TRANSFEROR TO
THE TRUSTEE.  AS USED HEREIN, THE TERMS “UNITED
STATES,” “OFFSHORE TRANSACTION,” AND “U.S. PERSON” HAVE THE RESPECTIVE MEANINGS
GIVEN TO THEM BY REGULATION S UNDER THE SECURITIES ACT.”

 

Notwithstanding the foregoing, any Global Security or
Definitive Security issued pursuant to subparagraph (b)(iv), (c)(iii), (c)(iv),
(d)(ii), (d)(iii), (e)(ii), (e)(iii) or (f) of this Section 2.06
(and all Securities issued in exchange therefor or substitution thereof) shall
not bear the Private Placement Legend.

 

(ii)                                  Global Security Legend.  Each Global Security shall bear a legend in
substantially the following form:

 

“UNLESS AND UNTIL IT IS EXCHANGED IN WHOLE OR IN PART FOR
SECURITIES IN DEFINITIVE FORM, THIS SECURITY MAY NOT BE TRANSFERRED EXCEPT
AS A WHOLE BY THE DEPOSITORY TRUST COMPANY, A NEW YORK CORPORATION (“DTC”), TO
A NOMINEE OF DTC, OR BY ANY SUCH NOMINEE OF DTC, OR BY DTC TO A SUCCESSOR
DEPOSITORY OR A NOMINEE OF SUCH SUCCESSOR DEPOSITORY.  UNLESS THIS CERTIFICATE IS PRESENTED BY AN
AUTHORIZED REPRESENTATIVE OF DTC, TO THE COMPANY OR ITS AGENT FOR REGISTRATION
OF TRANSFER, EXCHANGE OR PAYMENT, AND ANY CERTIFICATE ISSUED IS REGISTERED IN
THE NAME OF CEDE & CO. OR SUCH OTHER NAME AS IS REQUESTED BY AN
AUTHORIZED REPRESENTATIVE OF DTC (AND ANY PAYMENT HEREON IS MADE TO CEDE &
CO. OR TO SUCH OTHER ENTITY AS IS REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF
DTC), ANY TRANSFER, PLEDGE OR OTHER USE HEREOF FOR VALUE OR OTHERWISE BY OR TO
ANY PERSON IS WRONGFUL INASMUCH AS THE REGISTERED OWNER HEREOF, CEDE &
CO., HAS AN INTEREST HEREIN.”

 

“TRANSFERS OF THIS GLOBAL SECURITY SHALL BE LIMITED TO
TRANSFERS IN WHOLE, BUT NOT IN PART, TO NOMINEES OF CEDE & CO. OR TO A
SUCCESSOR THEREOF OR SUCH SUCCESSOR’S NOMINEE AND TRANSFERS OF PORTIONS OF THIS
GLOBAL SECURITY SHALL BE LIMITED

 

32

 

TO TRANSFERS MADE IN ACCORDANCE WITH THE RESTRICTIONS
SET FORTH IN SECTION 2.06 OF THE INDENTURE.”

 

(h)                                 Regulation S Global Security
Legend.  The Regulation S Global Security shall bear a
legend in substantially the following form:

 

“THE RIGHTS ATTACHING TO THIS REGULATION S GLOBAL
SECURITY, AND THE CONDITIONS AND PROCEDURES GOVERNING ITS EXCHANGE FOR
CERTIFICATED SECURITIES, ARE AS SPECIFIED IN THE INDENTURE (AS DEFINED HEREIN).”

 

(i)                                     Cancellation and/or Adjustment
of Global Securities.  At such time as all beneficial interests in a
particular Global Security have been exchanged for Definitive Securities or a
particular Global Security has been redeemed, repurchased or canceled in whole
and not in part, each such Global Security shall be returned to or retained and
canceled by the Trustee in accordance with Section 2.11 hereof.  At any time prior to such cancellation, if
any beneficial interest in a Global Security is exchanged for or transferred to
a Person who shall take delivery thereof in the form of a beneficial interest
in another Global Security or for Definitive Securities, the principal amount
of Securities represented by such Global Security shall be reduced accordingly
and an endorsement shall be made on such Global Security by the Trustee or by
the Depositary at the direction of the Trustee to reflect such reduction; and
if the beneficial interest is being exchanged for or transferred to a Person
who shall take delivery thereof in the form of a beneficial interest in another
Global Security, such other Global Security shall be increased accordingly and
an endorsement shall be made on such Global Security by the Trustee or by the
Depositary at the direction of the Trustee to reflect such increase.

 

(j)                                     General Provisions Relating to
Transfers and Exchanges.

 

(i)                                     To
permit registrations of transfers and exchanges, the Company shall execute and
the Trustee shall authenticate Global Securities and Definitive Securities upon
the Company’s order or at the Registrar’s request.

 

(ii)                                  No
service charge shall be made to a Holder of a beneficial interest in a Global
Security or to a Holder of a Definitive Security for any registration of
transfer or exchange, but the Company may require payment of a sum sufficient
to cover any transfer tax or similar governmental charge payable in connection
therewith (other than any such transfer taxes or similar governmental charge
payable upon exchange or transfer pursuant to Sections 2.10, 3.06, 4.05, 4.14
and 10.05).

 

(iii)                               The
Registrar shall not be required to register the transfer of or exchange any
Security selected for redemption in whole or in part, except the unredeemed
portion of any Security being redeemed in part.

 

(iv)                              All
Global Securities and Definitive Securities issued upon any registration of
transfer or exchange of Global Securities or Definitive Securities shall be the
valid and legally binding obligations of the Company, evidencing the same debt,
and

 

33

 

entitled to the same benefits under this
Indenture, as the Global Securities or Definitive Securities surrendered upon
such registration of transfer or exchange.

 

(v)                                 The
Company shall not be required (A) to issue, to register the transfer of or
to exchange any Securities during a period beginning at the opening of business
15 days before the day of any selection of Securities for redemption under Section 3.02
and ending at the close of business on the day of selection, (B) to
register the transfer of or to exchange any Security so selected for redemption
in whole or in part, except the unredeemed portion of any Security being
redeemed in part, (C) to register the transfer of or to exchange a
Security between a record date and the next succeeding interest payment date or
(D) to register the transfer of or to exchange a Security tendered and not
withdrawn in connection with an Offer to Purchase.

 

(vi)                              Prior
to due presentment for the registration of a transfer of any Security, the
Trustee, any Agent and the Company may deem and treat the Person in whose name
any Security is registered as the absolute owner of such Security for the
purpose of receiving payment of principal of and interest on such Securities
and for all other purposes, and none of the Trustee, any Agent or the Company
shall be affected by notice to the contrary.

 

(vii)                           The
Trustee shall authenticate Global Securities and Definitive Securities in
accordance with the provisions of Section 2.02.

 

All certifications,
certificates and Opinions of Counsel required to be submitted to the Registrar
pursuant to this Section 2.06 to effect a registration of transfer or
exchange may be submitted by facsimile.

 

SECTION 2.07.   Replacement
Securities.

 

If a mutilated Security is surrendered to the Trustee
or if the Holder of a Security claims that the Security has been lost,
destroyed or wrongfully taken, the Company shall issue and the Trustee shall
authenticate a replacement Security if the Trustee’s requirements are met.  If required by the Trustee or the Company,
the Holder shall provide an indemnity bond in an amount sufficient in the
judgment of the Company and the Trustee to protect the Company, the Trustee or
any Agent from any loss which any of them may suffer if a Security is
replaced.  The Company and the Trustee
each may charge such Holder for its expenses in replacing such Security.

 

Every replacement Security is an additional obligation
of the Company.

 

SECTION 2.08.   Outstanding
Securities.

 

Securities outstanding at any time are all Securities
that have been authenticated by the Trustee except for those canceled by it,
those delivered to it for cancellation and those described in this Section as
not outstanding.  A Security does not
cease to be outstanding because the Company or one of its Affiliates holds the
Security.

 

34

 

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

 

If the Paying Agent holds on a redemption date or
Maturity Date money sufficient to pay the principal of, and interest on
Securities payable on that date, then on and after that date such Securities
cease to be outstanding and interest on them ceases to accrue.

 

SECTION 2.09.   Treasury
Securities.

 

In determining whether the Holders of the required
principal amount of Securities have concurred in any direction, waiver or
consent, Securities owned by the Company, any Subsidiary or any of their
respective Affiliates shall be disregarded, except that for the purposes of
determining whether the Trustee shall be protected in relying on any such
direction, waiver or consent, only Securities that a Trust Officer of the
Trustee actually knows are so owned shall be so disregarded.

 

The Trustee may require an Officers’ Certificate
listing securities owned by the Company, any Subsidiary or any of their
respective Affiliates.

 

SECTION 2.10.   Temporary
Securities.

 

Until certificates representing Securities are ready
for delivery, the Company may prepare and the Trustee shall authenticate
temporary Securities.  Temporary
Securities shall be substantially in the form of Definitive Securities but may
have variations that the Company considers appropriate for temporary
Securities.  Without unreasonable delay,
the Company shall prepare and the Trustee shall authenticate definitive
Securities in exchange for temporary Securities.  Until such exchange, temporary Securities
shall be entitled to the same rights, benefits and privileges as definitive
Securities.

 

SECTION 2.11.   Cancellation.

 

The Company at any time may deliver Securities to the
Trustee for cancellation.  The Registrar
and the Paying Agent shall forward to the Trustee any Securities surrendered to
them for transfer, exchange or payment. 
The Trustee and no one else shall cancel all Securities surrendered for
transfer, exchange, payment or cancellation. 
The Company may not issue new Securities to replace, reissue or resell
Securities which the Company has redeemed, paid, purchased on the open market
or otherwise, or otherwise acquired or have been delivered to the Trustee for
cancellation.  The Trustee (subject to
the record-retention requirements of the Exchange Act) may, but shall not be
required to, destroy canceled Securities.

 

SECTION 2.12.   Defaulted
Interest.

 

If the Company defaults in a payment of interest on
the Securities, it shall pay the defaulted interest, plus any interest payable
on the defaulted interest pursuant to Section 4.01 hereof, to the persons
who are Securityholders on a subsequent special record date, and such term, as
used in this Section 2.12 with respect to the payment of any defaulted
interest, shall mean the fifteenth day next preceding the date fixed by the
Company for the payment of

 

35

 

defaulted interest,
whether or not such day is a Business Day. 
At least 30 days before such special record date, the Company shall mail
to each Securityholder and to the Trustee a notice that states such special record
date, the payment date and the amount of defaulted interest to be paid.

 

SECTION 2.13.   CUSIP or CINS
Number.

 

The Company in issuing the Securities may use a “CUSIP”
or “CINS” number, and if so, such CUSIP or CINS number shall be included in
notices of redemption or exchange as a convenience to Holders; provided,
however, that any such notice may state that no representation is made
as to the correctness or accuracy of the CUSIP or CINS number printed in the
notice or on the Securities, and that reliance may be placed only on the other
identification numbers printed on the Securities.  The Company will promptly notify the Trustee
of any change in the CUSIP or CINS number.

 

SECTION 2.14.   Payments
of Interest.

 

(a)                                  The Holder of a Definitive
Security at the close of business on the regular record date with respect to
any Interest Payment Date shall be entitled to receive the interest payable on
such Interest Payment Date notwithstanding any transfer or exchange of such
Definitive Security subsequent to the regular record date and prior to such
Interest Payment Date, except if and to the extent the Company shall default in
the payment of the interest due on such Interest Payment Date, in which case
such defaulted interest shall be paid in accordance with Section 2.12; and
in the event of an exchange of a Definitive Security for a beneficial interest
in any Global Security subsequent to a regular record date or any special
record date and prior to or on the related Interest Payment Date or other
payment date under Section 2.12, any payment of the interest payable on
such payment date with respect to any such Definitive Security shall be made to
the Person in whose name such Definitive Security was registered on such record
date.  Payments of interest on the Global
Securities will be made on each Interest Payment Date to the Holder of the
Global Security on the record date with respect thereto; provided, however,
that, in the event of an exchange of all or a portion of a Global Security for
a Definitive Security subsequent to the regular record date or any special
record date and prior to or on the related Interest Payment Date or other
payment date under Section 2.12, any payment of interest payable on such
Interest Payment Date or other payment date with respect to the Definitive
Security shall be made to the Holder of the Global Security as of the
applicable record date.

 

(b)                                 Subject to Section 4.01,
interest shall be paid to DTC, with respect to any Global Security held by DTC,
on the applicable Interest Payment Date in accordance with instructions
received from DTC at least five Business Days before the applicable Interest
Payment Date.

 

36

 

ARTICLE THREE

 

REDEMPTION

 

SECTION 3.01.   Notices to
Trustee.

 

If the Company elects to redeem Securities pursuant to
paragraph 5 of the Securities at the applicable redemption price set forth
thereon, it shall notify the Trustee in writing of the redemption date and the
principal amount of Securities to be redeemed.

 

The Company shall give the notice provided for in this
Section 3.01 at least 15 days before the redemption date (unless a shorter
notice shall be agreed to by the Trustee in writing) but not more than 60 days
before the redemption date, together with an Officers’ Certificate stating that
such redemption will comply with the conditions contained herein.

 

SECTION 3.02.   Selection
of Securities to Be Redeemed.

 

If less than all of the Securities are to be redeemed
pursuant to paragraph 5 thereof, the Trustee shall select the Securities to be
redeemed pro rata or by lot or in such other manner as the Trustee shall deem
appropriate and fair.  The Trustee shall
make the selection from the Securities then outstanding, subject to redemption
and not previously called for redemption. 
The Trustee may select for redemption portions (equal to $1,000 or any
integral multiple thereof) of the principal of Securities that have
denominations larger than $1,000. 
Provisions of this Indenture that apply to Securities called for
redemption also apply to portions of Securities called for redemption.

 

SECTION 3.03.   Notice
of Redemption.

 

At least 30 days but not more than 60 days before a
redemption date, the Company shall mail a notice of redemption by first class
mail to each Holder whose Securities are to be redeemed.

 

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

 

(1)                                  the
redemption date;

 

(2)                                  the
redemption price;

 

(3)                                  the
CUSIP number (subject to Section 2.13);

 

(4)                                  the
name and address of the Paying Agent to which the Securities are to be
surrendered for redemption;

 

(5)                                  that
Securities called for redemption must be surrendered to the Paying Agent to
collect the redemption price;

 

(6)                                  that,
unless the Company defaults in making the redemption payment, interest on
Securities called for redemption ceases to accrue on and after the redemption

 

37

 

date and the only
remaining right of the Holders is to receive payment of the redemption price
upon surrender to the Paying Agent; and

 

(7)                                  if
any Security is being redeemed in part, the portion of the principal amount of
such Security to be redeemed and that, after the redemption date, upon
surrender of such Security, a new Security or Securities in principal amount
equal to the unredeemed portion thereof will be issued.

 

At the Company’s request, the Trustee shall give the
notice of redemption on behalf of the Company, in the Company’s name and at the
Company’s expense.

 

SECTION 3.04.   Effect
of Notice of Redemption.

 

Once a notice of redemption is mailed, Securities
called for redemption become due and payable on the redemption date and at the
redemption price.  Upon surrender to the
Paying Agent, such Securities shall be paid at the redemption price, plus
accrued interest thereon to the redemption date, but interest installments
whose maturity is on or prior to such redemption date shall be payable to the
Holders of record at the close of business on the relevant record dates
referred to in the Securities.  The
Trustee shall not be required to (i) issue, authenticate, register the
transfer of or exchange any Security during a period beginning 15 days before
the date a notice of redemption is mailed and ending at the close of business
on the date the redemption notice is mailed, or (ii) register the transfer
or exchange of any Security so selected for redemption in whole or in part,
except the unredeemed portion of any Security being redeemed in part.

 

SECTION 3.05.   Deposit
of Redemption Price.

 

Prior to 10:00 a.m. on the redemption date, the
Company shall deposit with the Paying Agent money sufficient to pay the
redemption price of and accrued interest on all Securities to be redeemed on
that date other than Securities or portions thereof called for redemption on
that date which have been delivered by the Company to the Trustee for
cancellation.

 

SECTION 3.06.   Securities
Redeemed in Part.

 

Upon surrender of a Security that is redeemed in part,
the Trustee shall authenticate for the Holder a new Security equal in principal
amount to the unredeemed portion of the Security surrendered.

 

ARTICLE FOUR

 

COVENANTS

 

SECTION 4.01.   Payment
of Securities.

 

The Company shall pay the principal of and interest on
the Securities in the manner provided in the Securities.  An installment of principal or interest shall
be considered paid on the date due if the Trustee or Paying Agent holds on that
date money designated for and

 

38

 

sufficient to pay the
installment in full and is not prohibited from paying such money to the Holders
of the Securities pursuant to the terms of this Indenture.

 

The Company shall pay interest on overdue principal at
the same rate per annum borne by the Securities.  The Company shall pay interest on overdue
installments of interest at the same rate per annum borne by the Securities, to
the extent lawful.

 

SECTION 4.02.   Maintenance
of Office or Agency.

 

The Company shall maintain in the Borough of
Manhattan, The City of New York, an office or agency where Securities may be
surrendered for registration of transfer or exchange or for presentation for
payment and where notices and demands to or upon the Company in respect of the
Securities and this Indenture may be served. 
The Company shall give prompt written notice to the Trustee of the
location, and any change in the location, of such office or agency.  If at any time the Company shall fail to
maintain any such required office or agency or shall fail to furnish the
Trustee with the address thereof, such presentations, surrenders, notices and
demands may be made or served at the address of the Trustee set forth in Section 13.02.

 

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

 

The Company hereby designates the principal Corporate
Trust Office of the Trustee as one such office or agency of the Company in
accordance with Section 2.03.

 

SECTION 4.03.   Limitation
on Transactions with Affiliates.

 

The Company shall not, and shall not cause or permit
any Restricted Subsidiary to, directly or indirectly, enter into any
transaction with any of their respective Affiliates (other than the Company or
a Wholly Owned Subsidiary), including, without limitation, the purchase, sale,
lease or exchange of property, the rendering of any service, or the making of
any guarantee, loan, advance or Investment, either directly or indirectly,
unless the terms of such transaction are at least as favorable as the terms
that could be obtained at such time by the Company or such Restricted
Subsidiary, as the case may be, in a comparable transaction made on an
arms-length basis with a Person that is not such an Affiliate; provided,
however, that (x) in any transaction involving aggregate consideration
in excess of $5.0 million, the Company shall deliver an officer’s certificate
to the Trustee stating that a majority of the disinterested directors of the
Board of Directors of the Company have determined, in their good faith
judgment, that the terms of such transaction are at least as favorable as the
terms that could be obtained by the Company or such Restricted Subsidiary, as
the case may be, in a comparable transaction made on an arms-length basis
between unaffiliated parties and (y), if the aggregate consideration is in
excess of $10.0 million, the Company shall also obtain, prior to the
consummation of the transaction, the

 

39

 

favorable opinion of a
nationally recognized accounting, appraisal or investment banking firm as to
the fairness of the transaction to the Company or such Restricted Subsidiary,
from a financial point of view.  The
provisions of this covenant shall not apply to: 
(i) transactions permitted by the provisions of Section 4.06; (ii) reasonable
fees and compensation paid to, and indemnity provided on behalf of, officers,
directors and employees of the Company and the Restricted Subsidiaries as
determined in good faith by the Board of Directors of the Company; (iii) loans
or advances to employees or consultants which are approved by a majority of the
Board of Directors of the Company in good faith; (iv) transactions made in
accordance with agreements in existence on the Issue Date (including pursuant
to any amendment thereto; provided, however, that any such
amendment is not more disadvantageous to the Holders in any material respect); (v) transactions
with customers, clients, suppliers, or purchasers or sellers of goods or
services, in each case in the ordinary course of business and otherwise in
compliance with the terms of the Indenture which, in the reasonable
determination of a majority of the members of the Board of Directors of the
Company or the senior management thereof, are fair to the Company or its
Restricted Subsidiaries or are on terms at least as favorable as might
reasonably have been obtained at such time from an unaffiliated party; (vi) any
transaction with a Restricted Subsidiary or joint venture or similar entity
which would constitute a transaction with an Affiliate solely because the
Company or a Restricted Subsidiary owns an equity interest in or otherwise
controls such Restricted Subsidiary, joint venture or similar entity; and (vii) the
issuance or sale of any Qualified Stock of the Company.

 

SECTION 4.04.   Limitation
on Incurrence of Indebtedness.

 

The Company shall not, and shall not cause or permit
any Restricted Subsidiary to, directly or indirectly, Incur any Indebtedness
(including Acquired Indebtedness), except:

 

(i)                                     Indebtedness
of the Company or any Guarantor, if, immediately after giving effect to the
Incurrence of such Indebtedness and the receipt and application of the net
proceeds thereof, the Consolidated Cash Flow Ratio of the Company for the four
full fiscal quarters for which quarterly or annual financial statements are
available next preceding the Incurrence of such Indebtedness would be greater
than 2.0 to 1.0;

 

(ii)                                  Indebtedness
(a) of the Company and any Guarantor Incurred under the Senior Credit
Facility in an aggregate principal amount at any time outstanding not to exceed
$150.0 million and (b) of Foreign Restricted Subsidiaries Incurred under
working capital or term loan facilities in an aggregate principal amount at any
time outstanding not to exceed $50.0 million; provided, however,
that the Indebtedness is Incurred, denominated and payable in United States dollars
or, in the case of a Foreign Restricted Subsidiary, the local currencies of the
jurisdictions of the operations of the Foreign Restricted Subsidiary Incurring
such Indebtedness, less, in each case, the amount of any prepayments actually
made after the Issue Date with respect to such Indebtedness with the Net
Available Proceeds of any Asset Dispositions (to the extent, in the case of a
revolving credit facility, accompanied by a permanent commitment reduction
thereunder);

 

(iii)                               Indebtedness
owed by the Company to any Restricted Subsidiary or Indebtedness owed by a
Restricted Subsidiary to the Company or a Restricted Subsidiary;

 

40

 

provided, however,
that upon either (I) the transfer or other disposition by such Restricted
Subsidiary or the Company of any Indebtedness so permitted under this clause (iii) to
a Person other than the Company or a Restricted Subsidiary or (II) the issuance
(other than directors’ qualifying shares), sale, transfer or other disposition
of shares of Capital Stock or other ownership interests (including by
consolidation or merger) of such Restricted Subsidiary that results in such
Indebtedness being held by a Person other than the Company or a Restricted
Subsidiary, the exception provided by this clause (iii) shall no longer be
applicable to such Indebtedness and such Indebtedness shall be deemed to have
been Incurred at the time of any such issuance, sale, transfer or other
disposition, as the case may be;

 

(iv)                              Indebtedness
of the Company or any Restricted Subsidiary under any interest rate agreement
to the extent entered into to protect the Company or such Restricted Subsidiary
from fluctuations in interest rates on any other Indebtedness permitted under
this Indenture (including the Securities); provided, however,
that the notional amount of such interest rate agreement does not exceed the
principal amount of the Indebtedness to which such interest rate agreement
relates;

 

(v)                                 Indebtedness
of the Company or any Restricted Subsidiary under Currency Agreements;

 

(vi)                              Indebtedness
Incurred to Refinance any Indebtedness outstanding on the Issue Date, other
than Indebtedness permitted pursuant to clause (ii) of this Section 4.04
above, any Indebtedness Incurred under the prior clause (i) of this Section 4.04
above or this clause (vi) or the Securities and any related Guarantee; provided,
however, that (I) such Indebtedness does not exceed the principal amount
(or accreted value, if less) of the Indebtedness so Refinanced plus the amount of
any premium required to be paid in connection with such Refinancing pursuant to
the terms of the Indebtedness being Refinanced or the amount of any premium
reasonably determined by the issuer of such Indebtedness as necessary to
accomplish such Refinancing by means of a tender offer, exchange offer, or
privately negotiated repurchase, plus the expenses of such issuer reasonably
incurred in connection therewith and (II) (A) in the case of any
Refinancing of Indebtedness that is pari
passu with the Securities, such Refinancing Indebtedness is made pari passu with or subordinate in right of
payment to the Securities, and, in the case of any Refinancing of Indebtedness
that is subordinate in right of payment to the Securities, such Refinancing
Indebtedness is subordinate in right of payment to the Securities on terms no
less favorable to the Holders than those contained in the Indebtedness being
Refinanced, (B) in either case, the Refinancing Indebtedness by its terms,
or by the terms of any agreement or instrument pursuant to which such
Indebtedness is issued, has a final maturity date no earlier than the final
maturity date of the Indebtedness being Refinanced, does not have an Average
Life that is less than the remaining Average Life of the Indebtedness being
Refinanced and does not require redemption or other retirement (including
pursuant to any required offer to purchase to be made by the Company or a
Restricted Subsidiary) of such Indebtedness at the option of the holder thereof
prior to the final stated maturity of the Indebtedness being Refinanced, other
than a redemption or other retirement at the option of the holder of such
Indebtedness (including pursuant to a required offer to purchase made by the
Company or

 

41

 

a Restricted Subsidiary) which is conditioned
upon a change of control of the Company pursuant to provisions substantially
similar to those contained in Section 4.14 or a redemption or other
retirement at the option of the holder of such Indebtedness which is
conditioned on the sale of assets by the Company pursuant to provisions
substantially similar to those contained in Section 4.05 and (C) any
Indebtedness Incurred to Refinance any Indebtedness is Incurred by the obligor
on the Indebtedness being Refinanced or by the Company;

 

(vii)                           Indebtedness
of the Company under the Securities and any related Guarantee and the Exchange
Securities and any related Guarantee to be issued therefor pursuant to the
Registration Rights Agreement in each case excluding any Additional Securities
and any related Guarantee;

 

(viii)                        Indebtedness
of the Company not otherwise permitted to be Incurred pursuant to clauses (i) through
(vii) of this Section 4.04 above or clauses (ix) through (xiv)
of this Section 4.04 below which, together with any other outstanding
Indebtedness Incurred pursuant to this clause (viii), has an aggregate
principal amount not in excess of $20.0 million at any time outstanding;

 

(ix)                                Indebtedness
outstanding on the Issue Date other than Indebtedness permitted pursuant to
clause (ii) of this Section 4.04 above;

 

(x)                                   Purchase
Money Indebtedness, Attributable Indebtedness and Capital Lease Obligations in
an aggregate amount not to exceed $35.0 million at any one time outstanding;

 

(xi)                                Indebtedness
Incurred by the Company or any of its Restricted Subsidiaries constituting
reimbursement obligations with respect to letters of credit issued in the
ordinary course of business, including without limitation letters of credit in
respect of workers’ compensation claims or self-insurance, or other
Indebtedness with respect to reimbursement type obligations regarding workers’
compensation claims; provided, however, that upon the drawing of
such letters of credit or the Incurrence of such Indebtedness, such obligations
are reimbursed within 30 days following such drawing or Incurrence;

 

(xii)                             Indebtedness
arising from agreements of the Company or a Restricted Subsidiary providing for
indemnification, adjustment of purchase price or similar obligations, in each
case, incurred or assumed in connection with the disposition of any business,
assets or the Capital Stock of a Subsidiary, other than guarantees of
Indebtedness incurred by any Person acquiring all or any portion of such
business, assets or the Capital Stock of a Subsidiary for the purpose of
financing such acquisition; provided, however, that (i) such
Indebtedness is not reflected on the balance sheet of the Company or any
Restricted Subsidiary (contingent obligations referred to in a footnote to
financial statements and not otherwise reflected on the balance sheet will not
be deemed to be reflected on such balance sheet for purposes of this clause
(i)) and (ii) the maximum assumable liability in respect of all such
Indebtedness shall at no time exceed the gross proceeds including noncash
proceeds (the fair market value of such noncash proceeds

 

42

 

being measured at the time received and
without giving effect to any subsequent changes in value) actually received by
the Company and its Restricted Subsidiaries in connection with such
disposition;

 

(xiii)                          obligations
in respect of performance and surety bonds and completion guarantees provided
by the Company or any Restricted Subsidiary in the ordinary course of business;
provided, however, that upon the drawing of any such bond such
obligation is reimbursed within 30 days of such drawing and provided  further,
however, in each case such obligations are not for borrowed money; and

 

(xiv)                         Indebtedness
arising from the honoring by a bank or other financial institution of a check,
draft or similar instrument drawn against insufficient funds in the ordinary
course of business; provided, however, that such Indebtedness is
extinguished within five days of its Incurrence.

 

For purposes of determining compliance with this Section 4.04,
guarantees of, or obligations in respect of letters of credit relating to,
Indebtedness, which is otherwise included in the determination of a particular
amount of Indebtedness, shall not be included.

 

In addition, for purposes of determining compliance
with this Section 4.04, in the event that any proposed Indebtedness meets
the criteria of more than one of the categories described in clauses (i) through
(xiv) of this Section 4.04, the Company will be permitted to classify such
item of Indebtedness at the time of its Incurrence in any manner that complies
with this covenant.  In addition, any
Indebtedness (or any portion thereof) originally classified as Incurred
pursuant to clauses (i) through (xiv) of this Section 4.04 may later
be reclassified by the Company such that it will be deemed as having been
Incurred pursuant to another of such clauses to the extent that such
reclassified Indebtedness could be incurred pursuant to such new clause at the
time of such reclassification. 
Notwithstanding the foregoing, Indebtedness under the Senior Credit
Facility outstanding on the Issue Date will be deemed to have been Incurred on
such date in reliance on the exception provided by clause (ii) of this Section 4.04.

 

SECTION 4.05.   Limitation
on Certain Asset Dispositions.

 

(a)                                  The Company will not, and will
not permit any of its Restricted Subsidiaries to, cause, make or suffer to
exist an Asset Disposition, unless (x) the Company, or its Restricted Subsidiaries,
as the case may be, receives consideration at the time of such Asset
Disposition at least equal to the fair market value (as determined in good
faith by the Company) of the assets or Capital Stock issued or sold or
otherwise disposed of and (y) at least 75% of the proceeds from such Asset
Disposition when received consists of either (I) cash or Cash Equivalents or
(II) property or assets that are used or useful in the business of the Company
or a Similar Business, or Capital Stock of any Person primarily engaged in a
Similar Business if, as a result of the acquisition by the Company or any
Restricted Subsidiary thereof, such Person becomes a Restricted Subsidiary; provided,
however, that the amount of any liabilities (as shown on the Company’s
or such Restricted Subsidiary’s most recent balance sheet) of the Company or
any Restricted Subsidiary (other than liabilities that are by their terms
subordinated to the Securities) that are assumed by the transferee of any such
assets pursuant to an agreement that

 

43

 

releases the Company or
Restricted Subsidiary from further liability shall be deemed to be cash for the
purposes of this provision.

 

(b)                                 Subject to the Company’s option
to undertake a Special Redemption of the Securities pursuant to paragraph 5 of
the Securities, within 365 days after the Company’s or any Restricted
Subsidiary’s receipt of the Net Proceeds of any Asset Disposition, the Company
or such Restricted Subsidiary may apply the Net Available Proceeds from such
Asset Disposition to (i) repay Indebtedness secured by such assets or
unsubordinated secured indebtedness and, in each case, permanently reduce any
related commitment thereunder or (ii) an investment in property, capital
expenditures or assets that are used or useful in the business of the Company
or a Similar Business, or Capital Stock of any Person primarily engaged in a
Similar Business if, as a result of such acquisition by the Company or any
Restricted Subsidiary, such Person becomes a Restricted Subsidiary or (iii) with
the net proceeds of the Asia/Pacific Operations Sale, in addition to any use of
such Net Proceeds as permitted by clauses (i) or (ii) of this Section 4.05(b),
(x) to repurchase or redeem up to $25.0 million principal amount of Securities
as provided in paragraph 5 of the Securities and/or (y) repay Indebtedness
under any revolving credit facility portion of the Senior Credit Facility
(regardless of whether the related commitment thereunder is permanently
reduced).

 

(c)                                  To the extent all or part of the
Net Available Proceeds of any Asset Disposition are not applied as described in
the immediately preceding paragraph within the time periods set forth therein
(the “Net Proceeds Utilization Date”) (such Net Available Proceeds, the “Unutilized
Net Available Proceeds”), the Company shall, within ten business days after
such Net Proceeds Utilization Date, make an Offer to Purchase all outstanding
Securities and Pari Passu Indebtedness, pro rata up to a maximum principal
amount (expressed as a multiple of $1,000) of Securities and Pari Passu
Indebtedness equal to such Unutilized Net Available Proceeds, at a purchase
price in cash equal to 100% of the principal amount thereof, plus accrued and
unpaid interest thereon, if any, to the Purchase Date; provided, however,
that the Offer to Purchase may be deferred until there are aggregate Unutilized
Net Available Proceeds equal to or in excess of $15.0 million, at which time
the entire amount of such Unutilized Net Available Proceeds, and not just the
amount in excess of $15.0 million, shall be applied as required pursuant to
this paragraph.  Pending the final
application of any such Net Available Proceeds, the Company or such Restricted
Subsidiary may temporarily reduce Indebtedness under a revolving credit
facility, if any, or otherwise invest such Net Available Proceeds in Cash
Equivalents.  To the extent that the
aggregate amount of Securities and Pari Passu Indebtedness tendered pursuant to
an Offer to Purchase is less than the Unutilized Net Available Proceeds, the
Company may use any remaining proceeds for general corporate purposes.  If the aggregate principal amount of
Securities and Pari Passu Indebtedness surrendered by Holders thereof exceeds
the amount of Unutilized Net Available Proceeds, the Trustee shall select the
Securities to be purchased in the manner described in the definition of Offer
to Purchase.  Upon completion of any such
Offer to Purchase, the amount of Unutilized Net Available Proceeds shall be
reset at zero.  These provisions will not
apply to a transaction consummated in compliance with Article Five.

 

The Company will comply with any applicable securities
laws and regulations, including any applicable requirements of Section 14(e) of,
and Rule 14e-l under, the Exchange Act, in connection with each repurchase
of Securities pursuant to an Offer to Purchase.

 

44

 

SECTION 4.06.   Limitation
on Restricted Payments.

 

The Company shall not, and shall not cause or permit any
Restricted Subsidiary to, directly or indirectly,

 

(i)                                     declare
or pay (without duplication) any dividend, or make any distribution of any kind
or character (whether in cash, property or securities), in respect of any class
of Capital Stock of the Company or any Restricted Subsidiary, excluding any (x)
dividends or distributions payable solely in shares of Qualified Stock or in
options, warrants or other rights to acquire Qualified Stock, or (y) in the
case of any Restricted Subsidiary, dividends or distributions payable to the
Company or another Restricted Subsidiary,

 

(ii)                                  purchase,
redeem, or otherwise acquire or retire for value any shares of Capital Stock of
the Company or any Restricted Subsidiary, any options, warrants or rights to
purchase or acquire such shares or any securities convertible or exchangeable
into such shares (other than any such shares of Capital Stock, options,
warrants, rights or securities that are owned by the Company or a Restricted
Subsidiary),

 

(iii)                               make
any Investment (other than a Permitted Investment) in, or make any payment on a
guarantee of any obligation of, any Person, other than the Company or a
Restricted Subsidiary, or

 

(iv)                              redeem,
defease, repurchase, retire or otherwise acquire or retire for value, prior to
its scheduled maturity, repayment or any sinking fund payment, Subordinated
Indebtedness (each of the transactions described in clauses (i) through (iv) (other
than any exception to any such clause) being a “Restricted Payment”)

 

if at the time thereof:

 

(1)                                  a
Default or an Event of Default shall have occurred and be continuing, or

 

(2)                                  after
giving effect to such Restricted Payment, the Company could not Incur at least
$1.00 of additional Indebtedness pursuant to clause (i) of Section 4.04,
or

 

(3)                                  upon
giving effect to such Restricted Payment, the aggregate of all Restricted
Payments declared or made on or after the Issue Date exceeds the sum (without
duplication) of:  (a) 50% of
cumulative Consolidated Net Income of the Company (or, in the case cumulative
Consolidated Net Income of the Company shall be negative, less 100% of such
deficit) for the period (treated as one accounting period) from the beginning
of the fiscal quarter immediately following the fiscal quarter during which the
Issue Date occurs through the last day of the Company’s most recently ended
fiscal quarter for which financial statements are available; plus (b) 100%
of the aggregate net cash proceeds and the fair market value of readily
marketable securities received after the Issue Date (A) from the issuance
of, or equity contribution received by the Company with respect to, shares of
Qualified Stock and warrants, rights or options to purchase or acquire shares
of Qualified Stock (other than from a Subsidiary of the Company) and (B) from
the Incurrence of Indebtedness of the Company or any Restricted Subsidiary

 

45

 

that has been
subsequently converted into or exchanged for Qualified Stock; plus (c) without
duplication of any amounts included in subclause (a) of this clause (3) above,
if the designation of a Subsidiary as an Unrestricted Subsidiary was treated as
a Restricted Payment made after the Issue Date, the proportionate interest of
the Company or any Restricted Subsidiary in the fair market value of any such
Unrestricted Subsidiary that has been redesignated as a Restricted Subsidiary
after the Issue Date in accordance with the definition of “Unrestricted
Subsidiary”; provided, however, that such amount shall not in any
case exceed the amount of Investments made by the Company or any Restricted
Subsidiary in such Unrestricted Subsidiary that was treated as a Restricted
Payment under this Indenture; plus (d) without duplication of any amounts
included in subclause (a)of this clause (3) above, in the case of the
disposition or repayment of any Investment (including by way of redemption,
repurchase or otherwise) constituting a Restricted Payment made after the Issue
Date, an amount equal to the lesser of cash proceeds that represents the return
of capital with respect to such Investment and the initial amount of such
Investment which was treated as a Restricted Payment, in either case, less the
cost of the disposition of such Investment and net of taxes.  For purposes of determining the amount expended
for Restricted Payments under this clause (d), property other than cash shall
be valued at its fair market value, plus (e) any amount which previously
qualified as a Restricted Payment made after the Issue Date on account of any
guarantee entered into by the Company or any Restricted Subsidiary; provided
that such guarantee has not been called upon and the obligation arising under
such guarantee no longer exists.

 

The foregoing provision will not prohibit (i) any
dividend on any class of Capital Stock of the Company or any Restricted
Subsidiary paid within 60 days after the declaration thereof if, on the date
when the dividend was declared, the Company or such Restricted Subsidiary, as
the case may be, could have paid such dividend in accordance with the provisions
of this Indenture; (ii) pro rata dividends or other pro rata distributions
on, in each case, Common Stock made by a Restricted Subsidiary that is not a
Wholly Owned Subsidiary to minority stockholders (or owners of an equivalent
interest in the case of a Restricted Subsidiary that is an entity other than a
corporation); (iii) the exchange or conversion of any Indebtedness of the
Company or any Restricted Subsidiary for or into Qualified Stock; (iv) so
long as no Default or Event of Default has occurred and is continuing, any
Investment made with the proceeds of a substantially concurrent sale (other
than to a Subsidiary of the Company) for cash of Qualified Stock; provided,
however, that the proceeds of such sale of Qualified Stock shall not be
(and have not been) included in clause (3) of the preceding paragraph; (v) the
redemption, repurchase, retirement or other acquisition of any Capital Stock of
the Company in exchange for, or out of the net cash proceeds of, the
substantially concurrent sale (other than to a Subsidiary of the Company) of
Qualified Stock; provided, however, that the proceeds of such
sale of Capital Stock shall not be (and have not been) included in clause (3) of
the preceding paragraph; (vi) so long as no Default or Event of Default
has occurred and is continuing, the redemption, repurchase or retirement of
Subordinated Indebtedness of the Company in exchange for, by conversion into,
or out of the net proceeds of, (A) a substantially concurrent sale or
incurrence of Subordinated Indebtedness (other than any Indebtedness owed to a
Subsidiary of the Company) of the Company that is contractually subordinated in
right of payment to the Securities to at least the same extent, which has a
final maturity date no earlier than the final maturity date of and an Average
Life no less than, in each case, the Subordinated Indebtedness being redeemed,

 

46

 

repurchased or retired or
(B) a substantially concurrent sale (other than to a Subsidiary of the
Company) for cash of Qualified Stock; provided, however, that the
proceeds of such sale of Capital Stock shall not be (and have not been)
included in clause (3) of the preceding paragraph; (vii) the making
of Investments in Unrestricted Subsidiaries or joint ventures provided that the
aggregate Net Investments therein shall not exceed $15.0 million at any time; (viii) the
repurchase, retirement or other acquisition or retirement for value of Capital
Stock of the Company held by any future, present or former employee or director
of the Company or any of the Company’s Restricted Subsidiaries or the estate,
heirs or legatees of, or any entity controlled by, any such employee or
director, pursuant to any management equity plan or stock option plan or any
other management or employee benefit plan or agreement in connection with the
termination of such person’s employment for any reason (including by reason of
death or disability); provided, however, that the aggregate
Restricted Payments made under this clause (viii) does not exceed in any
calendar year the sum of (A) $1.5 million (with unused amounts in any
calendar year being carried over to succeeding calendar years subject to a
maximum (without giving effect to the following proviso) of $10.0 million in
any calendar year) and (B) the cash proceeds of key man life insurance
policies on the life of any such person received by the Company and its
Restricted Subsidiaries after the Issue Date; (ix) so long as no Default
or Event of Default shall have occurred and be continuing, the declaration and
payment of dividends to holders of any class or series of Disqualified Stock of
the Company issued in accordance with Section 4.04; (x) repurchases of
Capital Stock deemed to occur upon exercise of stock options if such Capital
Stock represents a portion of the exercise price of such options; (xi) so
long as no Default or Event of Default has occurred and is continuing, the
declaration and payment of dividends to holders of any class or series of
Designated Preferred Stock (other than Disqualified Stock) issued after the
Issue Date; provided, however, that at the time of such issuance,
after giving effect to such issuance on a pro forma basis, the Consolidated
Cash Flow Ratio for the Company and its Restricted Subsidiaries for the most
recently ended four full fiscal quarters for which internal financial
statements are available immediately preceding the date of such issuance would
have been no less than 2.0 to 1.0; (xii) cash payments in lieu of the
issuance of fractional shares in connection with the exercise of warrants,
options or other securities convertible into or exchangeable for Capital Stock
of the Company; provided, however, that any such cash payment
shall not be for the purpose of evading the limitation of the covenant
described under this subheading (as determined in good faith by the Board of
Directors); (xiii) the payment, purchase, redemption, defeasance or other
acquisition or retirement of Existing Securities, together with any applicable
premium with respect thereto and accrued and unpaid interest thereon; (xiv) in
the event of a Change of Control, the payment, purchase, redemption, defeasance
or other acquisition or retirement of Subordinated Indebtedness at a purchase
price not greater than 101% of the principal amount of such Subordinated
Indebtedness (or, if such Subordinated Indebtedness were issued with original
issue discount, 101% of the accreted value thereof), plus any accrued and unpaid interest thereon; provided,
however, that prior to such payment, purchase, redemption, defeasance or
other acquisition or retirement, the Company (or a third party to the extent
permitted by this Indenture) has made a Change of Control Offer with respect to
the Securities as a result of such Change of Control and has repurchased all
Securities validly tendered and not withdrawn in connection with such Change of
Control Offer; and (xv) other Restricted Payments in an aggregate amount not to
exceed $15.0 million.  Each Restricted
Payment described in clauses (i) (to the extent not already taken into
account for purposes of computing the aggregate amount of all Restricted
Payments pursuant to clause (3) of the

 

47

 

preceding paragraph),
(ix), (xiv) and (xv) of the previous sentence shall be taken into account for
purposes of computing the aggregate amount of all Restricted Payments made
pursuant to clause (3) of the preceding paragraph.

 

For purposes of this Section, (i) an “Investment”
shall be deemed to have been made at the time any Restricted Subsidiary is
designated as an Unrestricted Subsidiary in an amount (proportionate to the
Company’s equity interest in such Subsidiary) equal to the net worth of such
Restricted Subsidiary at the time that such Restricted Subsidiary is designated
as an Unrestricted Subsidiary; (ii) at any date the aggregate amount of
all Restricted Payments made as Investments after the Issue Date shall exclude
and be reduced by an amount (proportionate to the Company’s equity interest in
such Subsidiary) equal to the net worth of an Unrestricted Subsidiary at the
time that such Unrestricted Subsidiary is redesignated a Restricted Subsidiary,
not to exceed, in the case of any such redesignation of an Unrestricted
Subsidiary as a Restricted Subsidiary, the amount of Investments previously
made by the Company and the Restricted Subsidiaries in such Unrestricted
Subsidiary; provided, however, that such amount shall not be
included in determining Consolidated Net Income for purposes of subclause (a) of
clause (3) of the second preceding paragraph (in each case (i) and (ii) “net
worth” is to be calculated based upon the fair market value of the assets of
such Subsidiary as of any such date of designation); and (iii) any
property transferred to or from an Unrestricted Subsidiary shall be valued at
its fair market value at the time of such transfer.

 

SECTION 4.07.   Corporate
Existence.

 

Subject to Article Five, the Company shall do or
shall cause to be done all things necessary to preserve and keep in full force
and effect its corporate existence and the corporate, partnership or other
existence of each of its Subsidiaries in accordance with the respective
organizational documents of each such Subsidiary and the rights (charter and
statutory) and material franchises of the Company and its Subsidiaries; provided,
however, that the Company shall not be required to preserve any such
right or franchise, or the corporate existence of any Subsidiary, if the Board
of Directors of the Company shall determine that the preservation thereof is no
longer desirable in the conduct of the business of the Company and its
Subsidiaries, taken as a whole; provided  further, however,
that a determination of the Board of Directors of the Company shall not be
required in the event of a merger of one or more Wholly Owned Subsidiaries with
or into another Wholly Owned Subsidiary or another Person, if the surviving
Person is a Wholly Owned Subsidiary organized under the laws of the United
States or a State thereof or of the District of Columbia.

 

SECTION 4.08.   Payment
of Taxes and Other Claims.

 

The Company shall pay or discharge or cause to be paid
or discharged, before the same shall become delinquent, all material taxes,
assessments and governmental charges levied or imposed upon the Company or any
of its Subsidiaries or upon the income, profits or property of the Company or
any of its Subsidiaries; 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.

 

48

 

SECTION 4.09.   Notice of
Defaults.

 

Within five days after becoming aware of any Default,
if such Default is then continuing, the Company shall promptly deliver an
Officers’ Certificate to the Trustee specifying the details of such Default and
the action which the Company proposes to take with respect thereto.

 

SECTION 4.10.   Maintenance
of Properties.

 

The Company shall cause all material properties owned
by or leased to it or any of its Subsidiaries and used or useful in the conduct
of its business or the business of any of its Subsidiaries to be maintained and
kept in normal condition, repair and working order and supplied with all
necessary equipment and shall 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 4.10 shall prevent the
Company or any of its Subsidiaries from discontinuing the use, operation or
maintenance of any of such properties, or disposing of any of them, if such
discontinuance or disposal is, in the judgment of the Board of Directors or of
the board of directors of the Subsidiary concerned, or of an officer (or other
agent employed by the Company or of any of its Subsidiaries) of the Company or
such Subsidiary having managerial responsibility for any such property,
desirable in the conduct of the business of the Company or any of its
Subsidiaries.

 

SECTION 4.11.   Compliance
Certificate.

 

The Company shall deliver to the Trustee within 90
days after the close of each fiscal year a certificate signed by the principal
executive officer, principal financial officer or principal accounting officer
stating that a review of the activities of the Company has been made under the
supervision of the signing officers with a view to determining whether a
Default has occurred and whether or not the signers know of any Default by the
Company that occurred during such fiscal year. 
If they do know of such a Default, the certificate shall describe all
such Defaults, their status and the action the Company is taking or proposes to
take with respect thereto.  The first
certificate to be delivered by the Company pursuant to this Section 4.11
shall be for the fiscal year ending October 31, 2005.

 

SECTION 4.12.   Provision
of Financial Information.

 

Whether or not the Company is subject to Section 13(a) or
15(d) of the Exchange Act, or any successor provision thereto, the Company
shall file with the Commission the annual reports, quarterly reports and other
documents which the Company would have been required to file with the
Commission pursuant to such Sections or any successor provision thereto if the
Company were so required.  The Company shall
file such documents with the Commission on or prior to the respective dates
(the “Required Filing Dates”) by which the Company would have been
required to file such documents if the Company were so required.  The Company shall also in any event (a) within
15 days of each Required Filing Date file with the Trustee, and promptly upon
written request by a beneficial holder or prospective holder of Securities
deliver to such holders or prospective holders, copies of the annual reports,
quarterly reports and other

 

49

 

documents which the
Company is required to file with the Commission pursuant to the preceding
sentence, and (b) if, notwithstanding the preceding sentence, filing such
documents by the Company with the Commission is not permitted under the
Exchange Act, promptly upon written request supply copies of such documents to
any beneficial holder or prospective holder of Securities.

 

SECTION 4.13.   Waiver
of Stay, Extension or Usury Laws.

 

The Company covenants (to the extent that it may lawfully
do so) that it shall not at any time insist upon, plead, or in any manner
whatsoever claim or take the benefit or advantage of, any stay or extension law
or any usury law or other law, which would prohibit or forgive the Company from
paying all or any portion of the principal of and/or interest on the Securities
as contemplated herein, wherever enacted, now or at any time hereafter in
force, or which may affect the covenants or the performance of this Indenture;
and (to the extent that it may lawfully do so) the Company hereby expressly
waives all benefit or advantage of any such law, and covenants that it shall
not hinder, delay or impede the execution of any power herein granted to the
Trustee, but shall suffer and permit the execution of every such power as
though no such law had been enacted.

 

SECTION 4.14.   Change of
Control.

 

Within 30 days following the date of the consummation
of a transaction resulting in a Change of Control or at the Company’s option
prior to such Change of Control but after the transaction giving rise to such
Change of Control is publicly announced, the Company will commence an Offer to
Purchase all outstanding Securities at a purchase price in cash equal to 101%
of their principal amount plus accrued and unpaid interest to the Purchase
Date; provided that the consummation of any such Offer to Purchase
commenced prior to such Change of Control actually occurring shall be subject
to such Change of Control Occurring. 
Such Offer to Purchase will be consummated not earlier than 30 days and
not later than 60 days after the commencement thereof.  Each holder shall be entitled to tender all
or any portion of the Securities owned by such holder pursuant to the Offer to
Purchase, subject to the requirement that any portion of a Security tendered
must be in an integral multiple of $1,000 principal amount.  A “Change of Control” shall be deemed
to have occurred upon any of the following events (whether or not otherwise
permitted by this Indenture): (i) the sale, lease or transfer, in one or a
series of related transactions, of all or substantially all of the assets of
the Company and its Subsidiaries, taken as a whole; (ii) the Company
becomes aware of (by way of a report or any other filing pursuant to Section 13(d) of
the Exchange Act, proxy, vote, written notice or otherwise) the acquisition by
any Person or group (within the meaning of Section 13(d)(3) or Section 14(d)(2) of
the Exchange Act, or any successor provision), including any group acting for
the purpose of acquiring, holding or disposing of securities (within the
meaning of Rule 13d-5(b)(1) under the Exchange Act), other than
the Permitted Holders, in a single transaction or in a related series of
transactions, by way of merger, consolidation or other business combination or
purchase of beneficial ownership (within the meaning of Rule 13d-3
under the Exchange Act, or any successor provision) of more than 50% of the
total voting power of the Voting Stock of the Company; or (iii) the first
day on which a majority of the members of the Board of Directors of the Company
are not Continuing Directors.  The
Company will comply with any applicable securities laws and regulations,
including any applicable requirements of Section 14(e) of, and

 

50

 

Rule 14e-l under,
the Exchange Act, in connection with each repurchase of Securities as a result
of a Change of Control.

 

SECTION 4.15.   Limitation
on Senior Subordinated Indebtedness.

 

The Company will not (i) directly or indirectly,
Incur any Indebtedness that by its terms would expressly rank senior in right
of payment to the Securities and rank subordinate in right of payment to any
other Indebtedness of the Company and (ii) cause or permit any Guarantor
to, and no Guarantor will, directly or indirectly, incur any Indebtedness that
by its terms would expressly rank senior in right of payment to the Guarantee
of such Guarantor and rank subordinate in right of payment to any other
Indebtedness of such Guarantor.

 

SECTION 4.16.   Limitation
on Restrictions Affecting Restricted Subsidiaries.

 

The Company will not, and will not cause or permit any
Restricted Subsidiary to, directly or indirectly, create or otherwise cause or
suffer to exist any consensual encumbrance or restriction on the ability of any
Restricted Subsidiary to:  (i) pay,
directly or indirectly, dividends or make any other distributions in respect of
its Capital Stock or pay any Indebtedness or other obligation owed to the
Company or any other Restricted Subsidiary, (ii) make loans or advances to
the Company or any other Restricted Subsidiary, (iii) transfer any of its
property or assets to the Company or any other Restricted Subsidiary, or except
for such encumbrances or restrictions existing under or by reason of (a) any
agreement in effect on the Issue Date as any such agreement is in effect on
such date, (b) the Senior Credit Facility, (c) any agreement relating
to Capital Stock of, or any Indebtedness Incurred by, such Restricted
Subsidiary prior to the date on which such Restricted Subsidiary was acquired
by the Company and outstanding on such date and not Incurred in anticipation or
contemplation of becoming a Restricted Subsidiary; provided, however,
that such encumbrance or restriction shall not apply to any property or assets
of the Company or any Restricted Subsidiary other than such Restricted
Subsidiary, (d) customary provisions contained in an agreement which has
been entered into for the sale or disposition of all or substantially all of
the Capital Stock or assets of a Restricted Subsidiary; provided, however,
that such encumbrance or restriction is applicable only to such Restricted
Subsidiary or its property and assets, (e) customary provisions in joint
venture agreements entered into in the ordinary course of business, (f) any
agreement effecting a Refinancing or amendment of Indebtedness Incurred
pursuant to any agreement referred to in clause (a) or (c) above; provided,
however, that the provisions contained in such Refinancing or amendment
agreement relating to such encumbrance or restriction are no more restrictive
in any material respect than the provisions contained in the agreement that is
the subject thereof in the reasonable judgment of the Board of Directors of the
Company, (g) this Indenture, (h) any agreement relating to any
Indebtedness of Foreign Restricted Subsidiaries permitted to be Incurred
pursuant to Section 4.04; provided, however, that (A) such
encumbrances or restrictions are ordinary and customary with respect to the
type of Indebtedness being incurred and (B) such encumbrances or
restrictions would not reasonably be expected to adversely affect the Company’s
ability to make principal and interest payments on the Securities, as
determined in good faith by the Board of Directors of the Company, (i) any
restriction on cash or other deposits imposed by customers under contracts
entered into in the ordinary course of business, (j) applicable law, rule or
regulation or any order or ruling by any governmental authority, (k) customary
provisions restricting subletting or assignment of any lease governing any
leasehold interest of any

 

51

 

Restricted Subsidiary,
(l) Purchase Money Indebtedness that imposes restrictions of the type referred
to in clause (iii) of this covenant, or (m) restrictions of the type
referred to in clause (iii) of this covenant contained in security
agreements securing Indebtedness of a Restricted Subsidiary to the extent that
such Liens were otherwise incurred in accordance with Section 4.17 and
restrict the transfer of property subject to such agreements.

 

SECTION 4.17.   Limitation on
Liens.

 

The Company will not, and will not cause or permit any
Restricted Subsidiary to, directly or indirectly, create, cause, incur or
suffer to exist any Lien on or with respect to the Capital Stock or any
property or assets of the Company or such Restricted Subsidiary owned on the
Issue Date or thereafter created or acquired or on the income or profits
thereof to secure any obligation, without making, or causing such Restricted
Subsidiary to make, effective provision for securing the Securities and all
other amounts due under this Indenture equally and ratably with such obligation
so secured (or, in the event such Indebtedness is Subordinated Indebtedness, prior
or senior thereto, with the same relative priority as the Securities will have
with respect to such Subordinated Indebtedness) for so long as such
Indebtedness shall be so secured.

 

The foregoing restrictions shall not apply to (i) Liens
existing on the Issue Date securing Indebtedness existing on the Issue Date
other than Indebtedness permitted to be Incurred under clause (ii) of Section 4.04;
(ii) Liens on the assets of the Company and any Restricted Subsidiary
securing Indebtedness permitted to be Incurred under clause (ii) of Section 4.04;
(iii) Liens securing only the Securities and the Guarantees, if any; (iv) Liens
in favor of the Company or any Guarantor; (v) Liens to secure Purchase
Money Indebtedness and Capital Lease Obligations; provided, however,
that (a) such Lien does not extend to or cover any other property or
assets other than such item of property and any improvements on such item and
any insurance proceeds resulting from damage to or destruction of such property
or improvements, and (b) the Incurrence of such Indebtedness is permitted
by Section 4.04; (vi) Liens on property existing immediately prior to
the time of acquisition thereof (and not created in connection with or in
anticipation or contemplation of the financing of such acquisition); (vii) Liens
on property of a Person existing at the time such Person is acquired or merged
with or into or consolidated with the Company or any such Restricted Subsidiary
(and not created in connection with or in anticipation or contemplation thereof);
(viii) Liens to secure Indebtedness Incurred to Refinance, in whole or in
part, any Indebtedness secured by Liens referred to in the foregoing clauses
(i)-(vii) of this paragraph so long as such Liens do not extend to any
other property and the principal amount of Indebtedness so secured is not
increased except for the amount of any premium required to be paid in
connection with such Refinancing pursuant to the terms of the Indebtedness
Refinanced or the amount of any premium reasonably determined by the Company as
necessary to accomplish such Refinancing by means of a tender offer, exchange
offer or privately negotiated repurchase, plus the expenses of the issuer of
such Indebtedness reasonably incurred in connection with such Refinancing; (ix) Liens
in favor of the Trustee as provided for in this Indenture on money or property
held or collected by the Trustee in its capacity as Trustee; (x) Liens to
secure the performance of statutory or regulatory obligations, leases, surety
or appeal bonds, performance bonds or other obligations of a like nature
incurred in the ordinary course of business; (xi) Liens for taxes, assessments
or governmental charges or claims that are not yet delinquent or that are being
contested in good faith by appropriate proceedings promptly instituted and
diligently concluded; provided, however, that any reserve or
other appropriate

 

52

 

provision as shall be
required in conformity with GAAP shall have been made therefor;
(xii) Liens incurred or deposits made in the ordinary course of business
in connection with worker’s compensation, unemployment insurance or other
social security obligations; (xiii) survey exceptions, encumbrances,
easements or reservations of, or rights of other for, rights of way, zoning or
other restrictions as to the use of properties, and defects in title which, in
the case of any of the foregoing, were not incurred or created to secure the
payment of Indebtedness, and which in the aggregate do not materially adversely
affect the value of such properties or materially impair the use for the
purposes of which such properties are held by the Company or any of its
Restricted Subsidiaries; (xiv) judgment and attachment Liens not giving rise to
an Event of Default and notices of lis
pendens and associated rights related to litigation being contested
in good faith by appropriate proceedings and for which adequate reserves have
been made; (xv) Liens in favor of collecting or payor banks having a right of
setoff, revocation, refund or chargeback with respect to money or instruments
of the Company or any Subsidiary thereof on deposit with or in possession of
such bank; (xvi) Liens arising from precautionary UCC financing statements
regarding operating leases or consignments; (xvii) Liens incurred in the
ordinary course of business of the Company or any Subsidiary of the Company
with respect to obligations that do not exceed $5.0 million at any one time
outstanding and that (a) are not incurred in connection with the borrowing
of money or the obtaining of advances or credit (other than trade credit in the
ordinary course of business) and (b) do not in the aggregate materially
detract from the value of the property or materially impair the use thereof in
the operation of business by the Company or such Subsidiary; (xviii) Liens on
the assets of the Company and any Restricted Subsidiary securing Indebtedness
permitted to be Incurred pursuant to Section 4.04 in an aggregate
principal amount that does not exceed 10% of the Consolidated Tangible Assets
of the Company as of the most recent quarter-end balance sheet date prior to
the time of the Incurrence of Indebtedness to be secured; (xix) Liens upon
specific items of inventory or other goods and proceeds therefrom of the
Company or any Restricted Subsidiary Securing the Company’s or any Restricted
Subsidiary’s obligations in respect of banker’s acceptances issued or created
for the account of the Company or any Restricted Subsidiary to facilitate the
purchase, shipment or storage of such inventory or other goods in the ordinary
course of business; (xx) Liens securing Currency Agreements and interest
rate agreements, to the extent the Indebtedness under any such interest rate
agreement is permitted by clause (iv) of Section 4.04; (xxi) Liens
securing reimbursement obligations with respect to letters of credit obtained
in the ordinary course of business which encumber documents and other property
relating to such letters of credit and products and proceeds thereof; and
(xxii) Liens in favor of customs and revenue authorities arising as a matter of
law to secure payment of custom duties in connection with importation of goods.

 

SECTION 4.18.   Subsidiary
Guarantees.

 

The Company shall not permit any Restricted
Subsidiary, directly or indirectly, to guarantee or pledge any assets to secure
the payment of any other Indebtedness of the Company or any Restricted
Subsidiary without causing such Restricted Subsidiary to become a
Guarantor.  Any such Restricted
Subsidiary shall (a) execute and deliver a supplemental indenture in form
reasonably satisfactory to the Trustee pursuant to which such Restricted
Subsidiary shall unconditionally guarantee all of the Company’s obligations
under the Securities and this Indenture on the terms set forth in this Indenture
and (b) deliver to the Trustee an opinion of counsel that such
supplemental indenture has been duly authorized, executed and delivered by

 

53

 

 

such Restricted
Subsidiary and constitutes a valid and legally binding and enforceable
obligation of such Restricted Subsidiary (subject, in the case of
enforceability, to customary bankruptcy, insolvency, fraudulent conveyance and
similar exceptions); provided, however, that the foregoing shall
not apply to any Foreign Restricted Subsidiary solely as a result of such
Foreign Restricted Subsidiary guaranteeing Indebtedness of any other Foreign
Restricted Subsidiary.

 

The Company may, at its option, cause any of its
Subsidiaries to be a Guarantor.

 

SECTION 4.19.   Limitation on Sale and Lease-Back Transactions.

 

The Company will not, and will not permit any of its
Restricted Subsidiaries to, enter into any Sale and Lease-Back Transaction; provided,
however, that the Company or any Restricted Subsidiary may enter into a
Sale and Lease-Back Transaction if:  (i) the
Company or such Restricted Subsidiary, as applicable, could have Incurred
Indebtedness in an amount equal to the Attributable Indebtedness relating to
such Sale and Lease-Back Transaction; (ii) the gross cash proceeds of that
Sale and Lease-Back Transaction are at least equal to the fair market value of
the property that is the subject of that Sale and Lease-Back Transaction; and (iii) the
transfer of assets in that Sale and Lease-Back Transaction is permitted by, and
the Company applies the proceeds of such transaction in compliance with, Section 4.05.

 

ARTICLE FIVE

 

MERGERS; SUCCESSOR CORPORATION

 

SECTION 5.01.   Restriction on Mergers, Consolidations and Certain Sales of
Assets.

 

The Company will not consolidate or merge with or into
any Person, or sell, assign, lease, convey or otherwise dispose of (or cause or
permit any Restricted Subsidiary to consolidate or merge with or into any
Person or sell, assign, lease, convey or otherwise dispose of) all or
substantially all of the Company’s assets (determined on a consolidated basis
for the Company and the Restricted Subsidiaries), whether as an entirety or
substantially an entirety in one transaction or a series of related
transactions, including by way of liquidation or dissolution, to any Person
unless, in each such case:  (i) the
entity formed by or surviving any such consolidation or merger (if other than
the Company or such Restricted Subsidiary, as the case may be), or to which
such sale, assignment, lease, conveyance or other disposition shall have been
made (the “Surviving Entity”), is a corporation organized and existing
under the laws of the United States, any state thereof or the District of Columbia;
(ii) the Surviving Entity assumes by supplemental indenture all of the
obligations of the Company on the Securities and under this Indenture; (iii) immediately
after giving effect to such transaction and the use of any net proceeds
therefrom on a pro forma basis and treating any Indebtedness which becomes an
obligation of the Company or any of its Restricted Subsidiaries as a result of
such transaction as having been Incurred by the Company or such Restricted
Subsidiary, as the case may be, at the time of the transaction, the Company or
the Surviving Entity, as the case may be, could Incur at least $1.00 of
Indebtedness pursuant to clause (i) of Section 4.04; (iv) immediately
before and after giving effect to such transaction, no Default or Event of Default
shall have occurred and be continuing; and (v) if, as a result of any such
transaction, property or assets of the Company or a

 

54

 

Restricted Subsidiary
would become subject to a Lien not excepted from the provisions of Section 4.17,
the Company, the Restricted Subsidiary or the Surviving Entity, as the case may
be, shall have secured the Securities as required by said covenant.  The provisions of this paragraph shall not
apply to any merger of a Restricted Subsidiary with or into the Company or a
Wholly Owned Subsidiary or the release of any Guarantor in accordance with the
terms of the Guarantee and this Indenture in connection with any transaction
complying with the provisions of Section 4.05.

 

SECTION 5.02.   Successor
Corporation Substituted.

 

Upon the execution of a supplemental indenture by the
Surviving Person in form and substance satisfactory to the Trustee (as
evidenced by the Trustee’s execution thereof) in accordance with Section 5.01,
the Surviving Person shall succeed to, and be substituted for, and may exercise
every right and power of and shall assume all obligations of, the Company or
such Subsidiary, as the case may be, under this Indenture, the Registration
Rights Agreement and the Securities or the Guarantees, as the case may be, with
the same effect as if such Surviving Person had been named as the Company or
such Subsidiary, as the case may be, herein and therein, and thereafter, except
in the case of a lease, the predecessor Person shall be relieved of all
obligations and covenants under this Indenture, the Registration Rights
Agreement and the Securities or the Guarantees, as the case may be.

 

ARTICLE SIX

 

DEFAULT AND REMEDIES

 

SECTION 6.01.   Events of Default.

 

An “Event of Default” occurs if:

 

(a)                                  the
Company fails to pay principal of (or premium, if any, on) any Security when
due;

 

(b)                                 the Company fails to pay any interest on any Security when
due, continued for 30 days;

 

(c)                                  the Company defaults in the payment of principal of and
interest on Securities required to be purchased pursuant to an Offer to
Purchase under Section 4.05 or 4.14 hereof when due and payable;

 

(d)                                 the Company fails to perform or comply with any of the
provisions of Section 5.01;

 

(e)                                  the
Company fails to perform any other covenant or agreement of the Company under
this Indenture or the Securities continued for 30 days after written notice to
the Company by the Trustee or holders of at least 25% in aggregate principal
amount of outstanding Securities;

 

55

 

(f)                                    the
Company defaults under the terms of one or more instruments evidencing or
securing Indebtedness of the Company or any of its Material Subsidiaries having
an outstanding principal amount of $15.0 million or more individually or in the
aggregate that has resulted in the acceleration of the payment of such
Indebtedness or failure to pay principal when due at the stated maturity of any
such Indebtedness;

 

(g)                                 the
rendering of a final judgment or judgments (not subject to appeal) against the
Company or any of its Material Subsidiaries (to the extent such judgments are
not paid or covered by insurance provided by a reputable carrier that has the
ability to perform and has acknowledged coverage in writing) in an amount of
$15.0 million or more which remains undischarged or unstayed for a period of 60
days after the date on which the right to appeal has expired;

 

(h)                                 the Company or any Material Subsidiary pursuant to or within
the meaning of any Bankruptcy Law:

 

(1)                                  commences
a voluntary case or proceeding,

 

(2)                                  consents to the entry of an order for relief against it in
an involuntary case or proceeding,

 

(3)                                  consents to the appointment of a Custodian of it or for all
or substantially all of its property, or

 

(4)                                  makes a general assignment for the benefit of its creditors;

 

(i)                                     a court of competent jurisdiction enters an order or decree
under any Bankruptcy Law that:

 

(1)                                  is
for relief against the Company or any Material Subsidiary in an involuntary
case or proceeding,

 

(2)                                  appoints
a Custodian of the Company or any Material Subsidiary or for all or
substantially all of its property, or

 

(3)                                  orders the liquidation of the Company or any Material
Subsidiary,

 

and in each case the order or decree remains unstayed
and in effect for 60 days; provided, however, that if the entry
of such order or decree is appealed and dismissed on appeal then the Event of
Default hereunder by reason of the entry of such order or decree shall be
deemed to have been cured; or

 

(j)                                     any
Guarantee ceases to be in full force and effect or is declared null and void
and unenforceable or is found to be invalid or any Guarantor denies its
liability under its Guarantee (other than by reason of a release of such
Guarantor from its Guarantee in accordance with the terms of this Indenture and
such Guarantee).

 

56

 

The term “Bankruptcy Law” means Title 11, U.S.
Code, as amended, or any similar Federal, state or
foreign law for the relief of debtors. 
The term “Custodian” means any receiver, trustee, assignee,
liquidator, sequestrator or similar official under any Bankruptcy Law.

 

SECTION 6.02.   Acceleration.

 

If an Event of Default (other than an Event of Default
with respect to the Company specified in Section 6.01(h) or (i))
shall occur and be continuing, either the Trustee or the Holders of at least
25% in aggregate principal amount of the outstanding Securities may accelerate
the maturity of all Securities; provided, however, that after
such acceleration, but before a judgment or decree based on acceleration, the
Holders of a majority in aggregate principal amount of outstanding Securities
may rescind and annul such acceleration if all Events of Default, other than
the non-payment of accelerated principal, have been cured or waived as provided
in this Indenture.  If an Event of
Default specified in Section 6.01(h) or (i) with respect to the
Company occurs, the outstanding Securities will ipso facto become immediately due and payable without any
declaration or other act on the part of the Trustee or any Holder.

 

SECTION 6.03.   Other Remedies.

 

If an Event of Default occurs and is continuing, the
Trustee may pursue any available remedy by proceeding at law or in equity to
collect the payment of principal of or interest on the Securities or to enforce
the performance of any provision of the Securities or this Indenture.

 

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

 

SECTION 6.04.   Waiver of Past Default.

 

Subject to Sections 2.09, 6.07 and 10.02, prior to the
declaration of acceleration of the Securities, (i) the Holders of not less
than a majority in aggregate principal amount of the outstanding Securities by
written notice to the Trustee may waive an existing Default and its
consequences, except a Default in the payment of principal of or interest on
any Security as specified in Section 6.01(a) or (b), a default
arising from failure to effect an Offer to Purchase required under Section 4.14
or a Default in respect of any term or provision of this Indenture that may not
be amended or modified without the consent of each Holder affected as provided
in Section 10.02 and (ii) the Holders of three-fourths of the
aggregate principal amount of Securities affected thereby, on behalf of all
Holders, may waive a default arising from failure to effect an Offer to
Purchase required under Section 4.14. 
The Company shall deliver to the Trustee an Officers’ Certificate
stating that the requisite percentage of Holders have consented to such waiver
and attaching copies of such consents. 
In case of any such waiver, the Company, the Trustee and the Holders
shall be restored to their former positions and rights hereunder and under the
Securities, respectively.  This paragraph
of this Section 6.04 shall be in lieu of Section 316(a)(1)(B)

 

57

 

of
the TIA and such Section 316(a)(1)(B) of the TIA is hereby expressly
excluded from this Indenture and the Securities, as permitted by the TIA.

 

Upon any such waiver, such Default shall cease to
exist and be deemed to have been cured and not to have occurred, and any Event
of Default arising therefrom shall be deemed to have been cured and not to have
occurred for every purpose of this Indenture and the Securities, but no such
waiver shall extend to any subsequent or other Default or impair any right
consequent thereon.

 

SECTION 6.05.   Control
by Majority.

 

Subject to Section 2.09, the Holders of a
majority in principal amount of the outstanding Securities may direct the time,
method and place of conducting any proceeding for any remedy available to the
Trustee or exercising any trust or power conferred on it.  However, the Trustee may refuse to follow any
direction that conflicts with law or this Indenture, that the Trustee
determines may be unduly prejudicial to the rights of another Securityholder,
or that may involve the Trustee in personal liability; provided, however,
that the Trustee may take any other action deemed proper by the Trustee which
is not inconsistent with such direction. 
In the event the Trustee takes any action or follows any direction
pursuant to this Indenture, the Trustee shall be entitled to indemnification
satisfactory to it in its sole discretion against any loss or expense caused by
taking such action or following such direction. 
This Section 6.05 shall be in lieu of Section 316(a)(1)(A) of the TIA, and such Section 316(a)(1)(A) of
the TIA is hereby expressly excluded from this Indenture and the Securities, as
permitted by the TIA.

 

SECTION 6.06.   Limitation on Suits.

 

A Securityholder may not pursue any remedy with
respect to this Indenture or the Securities unless:

 

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

 

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

 

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

 

(4)                                  the Trustee does not comply with the request within 60 days
after receipt of the request and the offer and, if requested, the provision of
indemnity; and

 

(5)                                  during such 60-day period the Holders of a majority in
principal amount of the outstanding Securities (excluding Affiliates of the
Company) do not give the Trustee a direction which, in the opinion of the
Trustee, is inconsistent with the request.

 

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

 

58

 

The limitations in this Section 6.06 do not apply
to a suit instituted by a Holder of a Security for enforcement of payment of
the principal of and premium, if any, or of interest on such Security on or
after the respective due dates therefor.

 

SECTION 6.07.   Rights of Holders to Receive Payment.

 

Notwithstanding any other provision of this Indenture,
the right of any Holder to receive payment of principal of and interest on the
Securities, on or after the respective due dates therefor, or to bring suit for
the enforcement of any such payment on or after such respective dates, shall
not be impaired or affected without the consent of such Holder.

 

SECTION 6.08.   Collection Suit by Trustee.

 

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

 

SECTION 6.09.   Trustee
May File Proofs of Claim.

 

The Trustee may file such proofs of claim and other
papers or documents as may be necessary or advisable in order to have the
claims of the Trustee (including any claim for the reasonable compensation,
expenses, disbursements and advances of the Trustee, its agents and counsel)
and the Securityholders allowed in any judicial proceedings relative to the
Company (or any other obligor upon the Securities), its creditors or its
property and shall be entitled and empowered to collect and receive any monies
or other property payable or deliverable on any such claims and to distribute
the same, and any Custodian in any such judicial proceedings is hereby
authorized by each Securityholder 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 Securityholders, to pay to the Trustee any amount due to it for
the reasonable compensation, expenses, disbursements and advances of the
Trustee, its agent and counsel, and any other amounts due the Trustee under Section 7.07.  Nothing herein contained shall be deemed to
authorize the Trustee to authorize or consent to or accept or adopt on behalf
of any Securityholder any plan of reorganization, arrangement, adjustment or
composition affecting the Securities or the rights of any Holder thereof, or to
authorize the Trustee to vote in respect of the claim of any Securityholder in
any such proceeding.

 

SECTION 6.10.   Priorities.

 

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

 

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

 

59

 

Second:                             subject to Articles Eight
and Twelve, to Holders for amounts due and unpaid on the Securities for
principal and interest, ratably, without preference or priority of any kind,
according to the amounts due and payable on the Securities for principal and
interest, respectively; and

 

Third:                            to the Company.

 

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

 

SECTION 6.11.   Undertaking for Costs.

 

In any suit for the enforcement of any right or remedy
under this Indenture or in any suit against the Trustee for any action taken or
omitted by it as Trustee, a court in its discretion may require the filing by
any party litigant in the suit of an undertaking to pay the costs of the suit,
and the court in its discretion may assess reasonable costs, including
reasonable attorneys’ fees and expenses, against any party litigant in the
suit, having due regard to the merits and good faith of the claims or defenses
made by the party litigant.  This Section 6.11
shall not apply to a suit by the Trustee, a suit by a Holder or group of
Holders of more than 10% in aggregate principal amount of the outstanding
Securities, or to any suit instituted by any Holder for the enforcement or the
payment of the principal or interest on any Securities on or after the
respective due dates therefor.

 

ARTICLE SEVEN

 

TRUSTEE

 

SECTION 7.01.   Duties of Trustee.

 

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

 

(b)                                 Except during the continuance of
a Default:

 

(1)                                  The
Trustee undertakes to perform such duties and only such duties as are
specifically set forth in this Indenture, and no implied covenants or
obligations shall be read into this Indenture against the Trustee; and

 

(2)                                  In
the absence of bad faith on its part, the Trustee may conclusively rely, as to
the truth of the statements and the correctness of the opinions expressed
therein, upon certificates or opinions conforming to the requirements of this
Indenture; provided, however, in the case of certificates or
opinions specifically required by any provision of this Indenture to be
furnished to it, the Trustee shall examine the certificates and opinions to
determine whether or not they conform to the requirements of this Indenture
(but need not confirm or investigate the accuracy of mathematical calculations
or other facts stated therein).

 

60

 

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

 

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

 

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

 

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

 

(d)                                 No provision of this Indenture
shall require the Trustee to expend or risk its own funds or otherwise incur
any financial liability in the performance of any of its duties hereunder or to
take or omit to take any action under this Indenture or take any action at the
request or direction of Holders if it shall have reasonable grounds for
believing that repayment of such funds is not assured to it or it does not
receive an indemnity satisfactory to it in its sole discretion against such
risk, liability, loss, fee or expense which might be incurred by it in compliance
with such request or direction.

 

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

 

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

 

SECTION 7.02.   Rights of Trustee.

 

Subject to Section 7.01:

 

(a)                                  The
Trustee may conclusively rely and shall be protected in acting or refraining
from acting on any document whether in its original or facsimile form believed
by it to be genuine and to have been signed or presented by the proper Person.  The Trustee need not investigate any fact or
matter stated in the document.

 

(b)                                 Before
the Trustee acts or refrains from acting, it may consult with counsel of its
selection and may require an Officers’ Certificate and an Opinion of Counsel,
which shall conform to the provisions of Section 13.05.  The Trustee shall not be liable for any
action it takes, suffers or omits to take in good faith in reliance on such
certificate or opinion.

 

(c)                                  The
Trustee may act through attorneys and agents of its selection and shall not be
responsible for the misconduct or negligence of any agent or attorney (other
than an agent who is an employee of the Trustee) appointed with due care.

 

61

 

(d)                                 The
Trustee shall not be liable for any action it takes or omits to take in good
faith which it reasonably believes to be authorized or within its rights or
powers conferred upon it by this Indenture.

 

(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
Securityholders pursuant to this Indenture, unless such Securityholders shall
have offered to the Trustee reasonable security or indemnity satisfactory to it
against the costs, expenses and liabilities which might be incurred by it in
compliance with such request or direction.

 

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

 

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

 

(h)                                 In
no event shall the Trustee be responsible or liable for special, indirect, or
consequential loss or damage of any kind whatsoever (including, but not limited
to, loss of profit) irrespective of whether the Trustee has been advised of the
likelihood of such loss or damage and regardless of the form of action.

 

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

 

SECTION 7.03.   Individual Rights of Trustee.

 

The Trustee in its individual or any other capacity
may become the owner or pledgee of Securities and may otherwise deal with the Company
or its Affiliates with the same rights it would have if it were not
Trustee.  Any Agent may do the same with
like rights.  However, the Trustee is
subject to Sections 7.10 and 7.11.

 

SECTION 7.04.   Trustee’s
Disclaimer.

 

The Trustee shall not be responsible for and makes no
representation as to the validity or adequacy of this Indenture or the
Securities, it shall not be accountable for the

 

62

 

Company’s use of the
proceeds from the Securities, and it shall not be responsible for any statement
of the Company in this Indenture or any document issued in connection with the
sale of Securities or any statement in the Securities other than the Trustee’s
certificate of authentication.

 

SECTION 7.05.   Notice of Defaults.

 

The Trustee shall, within 30 days after the occurrence
of any Default or Event of Default with respect to the Securities, give the
Holders notice of all uncured Defaults or Events of Default actually known to
it; provided, however, that, except in the case of an Event of
Default or a Default in payment with respect to the Securities or a Default or
Event of Default in complying with Section 5.01, the Trustee shall be
protected in withholding such notice if and so long as the Board of Directors
of the Trustee, the executive committee or a trust committee of directors or
responsible officers of the Trustee in good faith determine that the
withholding of such notice is in the interest of the Holders.

 

SECTION 7.06.   Reports by Trustee to Holders.

 

If required by TIA Section 313(a), within 60 days
after each July 1 beginning with the July 1 following the date of
this Indenture, the Trustee shall mail to each Securityholder a report dated as
of such July 1 that complies with TIA Section 313(a).  The Trustee also shall comply with TIA Section 313(b),
(c) and (d).

 

A copy of each such report at the time of its mailing
to Securityholders shall be filed with the Commission, the Company and each
stock exchange, if any, on which the Securities are listed in accordance with
TIA Section 313(d).

 

The Company shall promptly notify the Trustee in
writing if the Securities become listed on any securities exchange or of any
delisting therefrom.

 

SECTION 7.07.   Compensation and Indemnity.

 

The Company shall pay to the Trustee from time to time
such compensation as the Company and the Trustee shall from time to time agree
in writing for its services.  The Trustee’s
compensation shall not be limited by any law on compensation of a trustee of an
express trust.  The Company shall
reimburse the Trustee upon request for all reasonable disbursements, expenses
and advances (including reasonable fees, disbursements and expenses of its
agents and counsel) incurred or made by it in addition to the compensation for
its services except any such disbursements, expenses and advances as shall be
determined to have been caused by the Trustee’s own negligence or bad
faith.  Such expenses shall include the
reasonable compensation, disbursements and expenses of the Trustee’s agents, accountants,
experts and counsel and any taxes or other expenses incurred by a trust created
pursuant to Section 9.01 hereof.

 

The Company shall indemnify the Trustee or any
predecessor Trustee and their agents for, and hold them harmless against any
and all loss, damage, claims, liability or expense, including taxes (other than
franchise taxes imposed on the Trustee and taxes based upon, measured by or
determined by the income of the Trustee), arising out of or in connection with

 

63

 

the acceptance or
administration of the trust or trusts hereunder, including the costs and
expenses of enforcing this Indenture against the Company (including this Section 7.07)
and of defending itself against any claim (whether asserted by any
Securityholder or the Company or any other person) or liability in connection
with the exercise or performance of any of their powers or duties hereunder,
except to the extent that such loss, damage, claim, liability or expense is due
to their own negligence or bad faith. 
The Trustee shall notify the Company promptly of any claim asserted
against the Trustee of which a Trust Officer has received written notice for
which it may seek indemnity.  However,
the failure by the Trustee to so notify the Company shall not relieve the
Company of its obligations hereunder (unless and only to the extent that such
failure results in the loss or compromise of any rights or defenses).  The Company shall defend the claim and the
Trustee shall cooperate in the defense (and may employ its own counsel) at the
Company’s expense; provided, however, that the Company’s
reimbursement obligation with respect to counsel employed by the Trustee will
be limited to the reasonable fees and expenses of such counsel.  The Company need not pay for any settlement
made without its written consent, which consent shall not be unreasonably
withheld.

 

To the extent permitted by the Senior Credit Facility,
to secure the Company’s payment obligations in this Section 7.07, the
Trustee shall have a Lien prior to the Securities against all money or property
held or collected by the Trustee or any predecessor Trustee, in their capacity
as Trustee, except money or property held in trust to pay principal of or
interest on particular Securities.

 

When the Trustee incurs expenses or renders services
after an Event of Default specified in Section 6.01(h) or (i) occurs,
the expenses (including the reasonable fees and expenses of its agents and
counsel) and the compensation for the services shall be preferred over the
status of the Holders in a proceeding under any Bankruptcy Law and are intended
to constitute expenses of administration under any Bankruptcy Law.  The Company’s obligations under this Section 7.07
and any claim arising hereunder shall survive the resignation or removal of any
Trustee, the discharge of the Company’s obligations pursuant to Article Nine
and any rejection or termination under any Bankruptcy Law.

 

The provisions of this Section 7.07 shall survive
the termination of this Indenture.

 

SECTION 7.08.   Replacement of Trustee.

 

The Trustee may resign at any time by so notifying the
Company in writing.  The Holders of a
majority in aggregate principal amount of the outstanding Securities may remove
the Trustee by so notifying the Trustee and the Company in writing and may
appoint a successor Trustee with the Company’s consent.  The Company may remove the Trustee if:

 

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

 

(2)                                  the Trustee is adjudged a bankrupt or an insolvent under any
Bankruptcy Law;

 

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

 

64

 

(4)                                  the Trustee becomes incapable of acting.

 

If the Trustee resigns or is removed or if a vacancy
exists in the office of Trustee for any reason (the Trustee in such event being
referred to herein as the retiring Trustee), the Company shall promptly appoint
a successor Trustee

 

A successor Trustee shall deliver a written acceptance
of its appointment to the retiring Trustee and to the Company.  As promptly as practicable after that, the
retiring Trustee shall transfer, after payment of all sums then owing to the
Trustee pursuant to Section 7.07, all property held by it as Trustee to
the successor Trustee, subject to the Lien provided in Section 7.07, the
resignation or removal of the retiring Trustee shall become effective, and the
successor Trustee shall have the rights, powers and duties of the Trustee under
this Indenture.  A successor Trustee
shall mail notice of its succession to each Securityholder.

 

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

 

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

 

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

 

SECTION 7.09.   Successor Trustee by Merger, Etc.

 

If the Trustee consolidates with, merges or converts
into, or transfers all or substantially all of its corporate trust business to,
another corporation or banking corporation, the resulting, surviving or
transferee corporation or banking corporation without any further act shall be
the successor Trustee.

 

SECTION 7.10.   Eligibility; Disqualification.

 

This Indenture shall always have a Trustee which shall
be eligible to act as Trustee under TIA Sections 310(a)(1) and
310(a)(5).  The Trustee (or in the case
of a corporation included in a bank holding company, the related bank holding
company) shall have a combined capital and surplus of at least $50,000,000 as
set forth in its most recent published annual report of condition.  If the Trustee has or shall acquire any “conflicting
interest” within the meaning of TIA Section 310(b), the Trustee and the
Company shall comply with the provisions of TIA Section 310(b); provided,
however, that there shall be excluded from the operation of TIA Section 310(b)(1) any
indenture or indentures under which other securities, or certificates of
interest or participation in other securities, of the Company are outstanding,
if the requirements for such exclusion set forth in TIA Section 310(b)(1) are
met.  If at any time the Trustee shall
cease to be eligible in accordance with the provisions of this Section, the
Trustee shall resign immediately in the manner and with the effect hereinbefore
specified in this Article Seven.

 

65

 

SECTION 7.11.   Preferential
Collection of Claims Against Company.

 

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

 

ARTICLE EIGHT

 

[RESERVED]

 

 

ARTICLE NINE

 

SATISFACTION AND DISCHARGE OF INDENTURE;
DEFEASANCE

 

SECTION 9.01.   Termination
of Company’s Obligations.

 

  (a)  Satisfaction
and Discharge.  This Indenture will
be discharged and will cease to be of further effect as to all Securities
issued hereunder, when:

 

(1)                                  either:

 

(A)                              all
Securities that have been authenticated (except lost, stolen or destroyed Securities
that have been replaced or paid and Securities for whose payment money has
theretofore been deposited in trust and thereafter repaid to the Company) have
been delivered to the Trustee for cancellation; or

 

(B)                                all
Securities that have not been delivered to the Trustee for cancellation have
become due and payable by reason of the mailing of a notice of redemption or
otherwise or will become due and payable within one year, and the Company or
any Guarantor has irrevocably deposited or caused to be deposited with the
Trustee as trust funds in trust solely for the benefit of the Holders cash in
U.S. dollars, non-callable Government Obligations, or a combination thereof, in
such amounts as will be sufficient without consideration of any reinvestment of
interest, to pay and discharge the entire indebtedness on the Securities not
delivered to the Trustee for cancellation for principal, premium and Additional
Interest, if any, and accrued interest to the date of maturity or redemption;

 

(2)                                  no
Default or Event of Default will have occurred and be continuing on the date of
such deposit or will occur as a result of such deposit and such deposit will
not result in a breach or violation of, or constitute a default under, any
other instrument to which the Company or any Guarantor is a party or by which
the Company or any Guarantor is bound;

 

(3)                                  the Company or any Guarantor has paid or caused to be paid
all other sums payable by it under this Indenture; and

 

66

 

(4)                                  the Company has delivered irrevocable instructions to the
Trustee under this Indenture to apply the deposited money toward the payment of
the Securities at maturity or the redemption date, as the case may be.

 

In addition, the Company must deliver an Officers’
Certificate and an Opinion of Counsel to the Trustee stating that all
conditions precedent to satisfaction and discharge have
been satisfied.

 

(b)                                 Covenant Defeasance.  In addition to the provisions of Section 9.01(a),
the Company may, provided that no Default or Event of Default has occurred and
is continuing or would arise therefrom (or, with respect to a Default or Event
of Default specified in Section 6.01(h) or (i), any time on or prior
to the 91st calendar day after the date of such deposit (it being understood
that this condition shall not be deemed satisfied until after such 91st day)),
terminate its substantive obligations and the substantive obligations of the
Guarantors, if any, in respect of the Securities and the Guarantees (except for
the Company’s obligation to pay the principal of (and premium, if any, on) and
the interest on the Securities and such Guarantors’ guarantee thereof) by (i) depositing
with the Trustee, under the terms of an irrevocable trust agreement, money or
Government Obligations sufficient (without reinvestment) to pay all remaining
indebtedness on the Securities to maturity or to redemption, (ii) delivering
to the Trustee either an Opinion of Counsel or a ruling directed to the Trustee
from the Internal Revenue Service to the effect that the Holders will not
recognize income, gain or loss for federal income tax purposes as a result of
such deposit and termination of obligations, (iii) delivering to the
Trustee an Opinion of Counsel to the effect that the Company’s exercise of its
option under this paragraph will not result in the Company, the Trustee or the
trust created by the Company’s deposit of funds pursuant to this provision
becoming or being deemed to be an “investment company” under the Investment
Company Act of 1940, as amended, and (iv) delivering to the Trustee an
Officers’ Certificate and an Opinion of Counsel each stating that there has
been compliance with all conditions precedent provided for herein.

 

(c)                                  Legal Defeasance.  In addition to the provisions of Section 9.01(a) and
(b), the Company may, provided that no Default or Event of Default has occurred
and is continuing or would arise therefrom (or, with respect to a Default or
Event of Default specified in Section 6.01(h) or (i), any time on or
prior to the 91st calendar day after the date of such deposit (it being
understood that this condition shall not be deemed satisfied until after such
91st day)), terminate all of its substantive obligations and all of the
substantive obligations of the Guarantors, if any, in respect of the Securities
and the Guarantees (including the Company’s obligation to pay the principal of
(and premium, if any, on) and interest on the Securities and such Guarantors’
guarantee thereof) by (i) depositing with the Trustee, under the terms of
an irrevocable trust agreement, money or Government Obligations sufficient
(without reinvestment) to pay all remaining indebtedness on the Securities to
maturity or to redemption, (ii) delivering to the Trustee either a ruling
directed to the Trustee from the Internal Revenue Service to the effect that
the Holders will not recognize income, gain or loss for federal income tax
purposes as a result of such deposit and termination of obligations or an
Opinion of Counsel based upon such a ruling addressed to the Trustee or a
change in the applicable Federal tax law since the date of this Indenture, to
such effect, (iii) delivering to the Trustee an Opinion of Counsel to the
effect that the Company’s exercise of its option under this paragraph will not result
in the Company, the Trustee or the trust created by the Company’s deposit of
funds pursuant to this provision becoming or being deemed to be an “investment
company” under the Investment Company Act

 

67

 

of 1940, as amended, and (iv) delivering
to the Trustee an Officers’ Certificate and an Opinion of Counsel each stating
that there has been compliance with all conditions precedent provided for
herein.

 

(d)                                 Notwithstanding the foregoing
paragraphs (b) and (c) of this Section 9.01 above, the Company’s
obligations contained in Sections 2.03, 2.05, 2.06, 2.07, 4.02, 7.07, 7.08,
9.03 and 9.04 shall survive until the Securities are no longer
outstanding.  In addition,
notwithstanding the foregoing paragraph (b) of this Section 9.01, the
Company’s obligations contained in Section 4.01 shall also survive until
the Securities are no longer outstanding. 
Thereafter the Company’s obligations in Sections 7.07, 9.03 and 9.04
shall survive.  The Company may make an
irrevocable deposit pursuant to this Section 9.01 only if at such time it
is not prohibited from doing so under the subordination provisions of this
Indenture and the Company has delivered to the Trustee and any Paying Agent an
Officers’ Certificate to that effect. 
After such delivery or irrevocable deposit and delivery of an Officers’
Certificate and Opinion of Counsel, the Trustee upon request of the Company
shall acknowledge in writing the discharge of the Company’s and the Guarantors’
(if any) obligations under the Securities, the Guarantees and this Indenture
other than those surviving obligations specified in this Section 9.01(d).

 

SECTION 9.02.   Application of Trust Money.

 

The Trustee shall hold in trust money or Government
Obligations deposited with it pursuant to Section 9.01, and shall apply
the deposited money and the money from Government Obligations in accordance
with this Indenture solely to the payment of principal of and interest on the
Securities.  The Company shall indemnify
the Trustee against any tax, fee or other charge imposed on or assessed against
the Government Obligations deposited pursuant to Section 9.01 or the
principal and interest received in respect thereof other than any such tax, fee
or other charge which by law is for the account of the Holders of outstanding
Securities.

 

SECTION 9.03.   Repayment to Company.

 

Subject to Sections 7.07 and 9.01, the Trustee shall
promptly pay to the Company upon receipt by the Trustee of the Company’s
written request accompanied by an Officers’ Certificate any excess money held
by it at any time.  The Trustee shall pay
to the Company upon such request any money held by it for the payment of
principal or interest that remains unclaimed for two years; provided, however,
that the Trustee before being required to make any payment may at the expense
of the Company cause to be published once in a newspaper of general circulation
in The City of New York or mail to each Holder entitled to such money notice
that such money remains unclaimed and that, after a date specified therein
which shall be at least 30 days from the date of such publication or mailing,
any unclaimed balance of such money then remaining shall be repaid to the
Company.  After payment to the Company,
Securityholders entitled to money must look to the Company for payment as
general creditors unless an applicable abandoned property law designates
another person, and all liability of the Trustee or Paying Agent with respect
to such money shall thereupon cease.

 

68

 

SECTION 9.04.   Reinstatement.

 

If the Trustee is unable to apply any money or
Government Obligations in accordance with Section 9.01 by reason of any
legal proceeding or by reason of any order or judgment of any court or
governmental authority enjoining, restraining or otherwise prohibiting such
application, the Company’s and the Guarantors’ (if any) obligations under this
Indenture and the Securities shall be revived and reinstated as though no
deposit had occurred pursuant to Section 9.01 until such time as the
Trustee is permitted to apply all such money or Government Obligations in
accordance with Section 9.01; provided, however, that if the
Company has made any payment of interest on or principal of any Securities
because of the reinstatement of its obligations, the Company shall be
subrogated to the rights of the Holders of such Securities to receive such
payment from the money or Government Obligations held by the Trustee.

 

ARTICLE TEN

 

AMENDMENTS, SUPPLEMENTS AND WAIVERS

 

SECTION 10.01.   Without Consent of Holders.

 

The Company and the Guarantors, if any, when
authorized by a resolution of their respective Boards of Directors, and the
Trustee may amend or supplement this Indenture or the Securities without notice
to or consent of any Securityholder:

 

(1)                                  cure any ambiguity, defect or inconsistency;

 

(2)                                  provide for uncertificated Securities in addition to or in
place of certificated Securities;

 

(3)                                  provide
for the assumption of the Company’s or any Guarantor’s obligations to Holders
of the Securities in the case of a merger or consolidation or sale of all or
substantially all of the Company’s or such Guarantor’s assets;

 

(4)                                  make any change that would provide any additional rights or
benefits to the Holders of Securities or that does not adversely affect the
legal rights under this Indenture of any such Holder;

 

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

 

(6)                                  to
reflect the release of a Guarantor from its obligations with respect to its
Guarantee in accordance with the provisions of Section 11.03 and to add a
Guarantor pursuant to the requirements of Section 4.18;

 

(7)                                  evidence and provide for the acceptance of appointment by a
successor Trustee; or

 

(8)                                  provide
for the issuance of Additional Securities in accordance with this Indenture;

 

69

 

provided, however, that the
Company has delivered to the Trustee an Opinion of Counsel and an Officers’
Certificate each stating that such amendment or supplement complies with the
provisions of this Section 10.01.

 

SECTION 10.02.   With Consent of Holders.

 

The Company, the Guarantors, if any, and the Trustee
may amend or supplement this Indenture or the Securities with the written
consent of the Holders of at least a majority in principal amount of the
outstanding Securities.  However, without
the consent of each Holder affected, an amendment, supplement or waiver may
not:

 

(1)                                  change the Stated Maturity of the principal of any Security;

 

(2)                                  alter
the optional redemption provisions of any Security or this Indenture in a
manner adverse to the holders of the Securities;

 

(3)                                  reduce
the principal amount of any Security;

 

(4)                                  reduce
the rate of or extend the time for payment of interest on any Security;

 

(5)                                  change
the place or currency of payment of principal of or interest on any Security;

 

(6)                                  modify
any provisions of this Indenture relating to the waiver of past defaults (other
than to add sections of this Indenture subject thereto) or the right of the
Holders to institute suit for the enforcement of any payment on or with respect
to any Security or the Guarantees, or the modification and amendment of this
Indenture and the Securities (other than to add sections of this Indenture or
the Securities which may not be amended, supplemented or waived without the
consent of each Holder affected);

 

(7)                                  reduce the percentage of the principal amount of outstanding
Securities necessary for amendment to or waiver of compliance with any
provision of this Indenture or the Securities or for waiver of any Default;

 

(8)                                  waive
a default in the payment of principal of, interest on, or redemption payment
with respect to, any Security (except a rescission of acceleration of the
Securities by the Holders as provided in this Indenture and a waiver of the
payment default that resulted from such acceleration);

 

(9)                                  modify
the ranking or priority of the Securities or the Guarantees, if any, in any
manner adverse to the Holders;

 

(10)                            release any Guarantor from any of its obligations under its
Guarantee or this Indenture otherwise than in accordance with this Indenture;
or

 

(11)                            modify
any of the provisions (including the definitions relating thereto) relating to
any Offer to Purchase required under Section 4.05 or 4.14 in a manner

 

70

 

materially adverse
to the holders of Securities with respect to any Asset Disposition that has
been consummated or Change of Control that has occurred.

 

The Holders of a majority in aggregate principal
amount of the outstanding Securities, on behalf of all holders of Securities,
may waive compliance by the Company with certain restrictive provisions of this
Indenture.  Subject to certain rights of
the Trustee, as provided in this Indenture, the Holders of a majority in
aggregate principal amount of the outstanding Securities, on behalf of all
Holders of Securities, may waive any past default under this Indenture, except
a default in the payment of principal, premium or interest or a default arising
from failure to purchase any Security tendered pursuant to an Offer to
Purchase, or a default in respect of a provision that under this Indenture
cannot be modified or amended without the consent of the Holder of each
outstanding Security affected.

 

It shall not be necessary for the consent of the
Holders under this Section 10.02 to approve the particular form of any
proposed amendment or waiver, but it shall be sufficient if such consent
approves the substance thereof.

 

SECTION 10.03.   Compliance with Trust Indenture Act.

 

Every amendment to or supplement of this Indenture or
the Securities shall comply with the TIA as then in effect.

 

SECTION 10.04.   Revocation and Effect of Consents.

 

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

 

The Company may, but shall not be obligated to, fix a
record date for the purpose of determining the Holders entitled to consent to
any amendment, supplement or waiver.  If
a record date is fixed, then, notwithstanding the last sentence of the
immediately preceding paragraph, those Persons who were Holders at such record
date (or their duly designated proxies), and only those Persons, shall be
entitled to consent to such amendment, supplement or waiver or to revoke any
consent previously given, whether or not such Persons continue to be Holders after
such record date.  No such consent shall
be valid or effective for more than 90 days after such record date.

 

After an amendment, supplement or waiver becomes
effective, it shall bind every Securityholder, unless it makes a change
described in the second sentence of Section 10.02.  In that case the amendment, supplement or
waiver shall bind each Holder of a Security who has consented to it and every
subsequent Holder of a Security or portion of a Security that evidences the
same debt as the consenting Holder’s Security.

 

71

 

SECTION 10.05.   Notation on or Exchange of Securities.

 

If an amendment, supplement or waiver changes the
terms of a Security, the Trustee may require the Holder of the Security to deliver
it to the Trustee.  The Trustee may place
an appropriate notation on the Security about the changed terms and return it
to the Holder.  Alternatively, if the
Company or the Trustee so determines, the Company in exchange for the Security
shall issue and the Trustee shall authenticate a new Security that reflects the
changed terms.  Failure to make the
appropriate notation or issue a new Security shall not affect the validity and
effect of such amendment, supplement or waiver.

 

SECTION 10.06.   Trustee
To Sign Amendments, etc.

 

The Trustee shall be provided with, and shall be fully
protected in relying upon, an Opinion of Counsel and an Officers’ Certificate
each stating that the execution of any amendment, supplement or waiver
authorized pursuant to this Article Ten is authorized or permitted by this
Indenture and that such amendment, supplement or waiver constitutes the legal,
valid and binding obligation of the Company and the Guarantors, enforceable in
accordance with its terms (subject to customary exceptions).  The Trustee shall execute any amendment,
supplement or waiver authorized pursuant to this Article Ten, provided,
however, that the Trustee may, but shall not be obligated to, execute
any such amendment, supplement or waiver which affects the Trustee’s own
rights, duties or immunities under this Indenture or otherwise.  In signing any amendment, supplement or
waiver, the Trustee shall be entitled to receive an indemnity reasonably
satisfactory to it.

 

ARTICLE ELEVEN

 

GUARANTEE

 

SECTION 11.01.   Unconditional Guarantee.

 

Each Guarantor who becomes a party to this Indenture
hereby unconditionally, jointly and severally, guarantees to each Holder of a
Security authenticated and delivered by the Trustee and to the Trustee and its
successors and assigns that:  the
principal of and interest on the Securities will be promptly paid in full when
due, subject to any applicable grace period, whether at maturity, by
acceleration or otherwise, and interest on the overdue principal and interest
on any overdue interest on the Securities and all other obligations of the
Company to the Holders or the Trustee hereunder or under the Securities will be
promptly paid in full or performed, all in accordance with the terms hereof and
thereof; subject, however, to the limitations set forth in Section 11.04.  Each such Guarantor hereby agrees that its
obligations hereunder shall be unconditional, irrespective of the validity,
regularity or enforceability of the Securities or this Indenture, the absence
of any action to enforce the same, any waiver or consent by any Holder of the
Securities with respect to any provisions hereof or thereof, the recovery of
any judgment against the Company, any action to enforce the same or any other
circumstance which might otherwise constitute a legal or equitable discharge or
defense of a guarantor.  Each such
Guarantor hereby waives diligence, presentment, demand of payment, filing of
claims with a court in the event of insolvency or bankruptcy of the Company,
any right to require a proceeding first against the Company, protest, notice
and all demands whatsoever and covenants that the

 

72

 

Guarantee will not be
discharged except by complete performance of the obligations contained in the
Securities, this Indenture, and this Guarantee. 
If any Holder or the Trustee is required by any court or otherwise to
return to the Company, any Guarantor, or any custodian, trustee, liquidator or
other similar official acting in relation to the Company or any Guarantor, any
amount paid by the Company or any Guarantor to the Trustee or such Holder, this
Guarantee, to the extent theretofore discharged, shall be reinstated in full
force and effect.  Each Guarantor further
agrees that, as between each Guarantor, on the one hand, and the Holders and
the Trustee, on the other hand, (x) the maturity of the obligations guaranteed
hereby may be accelerated as provided in Article Six for the purpose of
this Guarantee, notwithstanding any stay, injunction or other prohibition
preventing such acceleration in respect of the obligations guaranteed hereby,
and (y) in the event of any acceleration of such obligations as provided in Article Six,
such obligations (whether or not due and payable) shall forthwith become due
and payable by each Guarantor for the purpose of this Guarantee.  This Guarantee is intended to be superior to
or pari passu in right of payment
with the guarantee of Indebtedness made by a Guarantor that obligated such
Guarantor to enter into its Guarantee, and each Guarantor’s obligations under
its Guarantee is independent of any obligation of the Company or any other
Guarantor.

 

SECTION 11.02.   Severability.

 

In case any provision of this Guarantee 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 11.03.   Release of a Guarantor.

 

If (i) the Securities are defeased in accordance
with Section 9.01(c), (ii) all of the Capital Stock of any Guarantor
is sold (including by issuance or otherwise) by the Company or any of its
Subsidiaries to a Person that is not (either before or after giving effect to
such transaction) a Subsidiary of the Company in a transaction constituting an
Asset Disposition, and, if required by this Indenture, (x) the Net Available
Proceeds from such Asset Disposition are used in accordance with Section 4.05
or (y) the Company delivers to the Trustee an Officers’ Certificate covenanting
that the Net Available Proceeds from such Asset Disposition will be used in
accordance with Section 4.05 and within the time limits specified by such Section 4.05,
(iii) the Company properly designates any Restricted Subsidiary that is a
Guarantor as an Unrestricted Subsidiary under this Indenture; or (iv) upon
the release or discharge of the guarantee or pledge which resulted in the
creation of such Guarantee, except a discharge or release by or as a result of
payment under such guarantee or pledge, then such Guarantor shall be released
and discharged from all obligations under this Article Eleven, in the case
of clause (ii) above, upon such use in the case of subclause (x) or upon
such delivery in the case of subclause (y), and otherwise, in accordance with
this Section 11.03.  The Trustee shall,
at the sole cost and expense of the Company and upon receipt at the reasonable
request of the Trustee of an Opinion of Counsel that the provisions of this Section 11.03
have been complied with, deliver an appropriate instrument evidencing such
release upon receipt of a request by the Company accompanied by an Officers’
Certificate certifying as to the compliance with this Section.  Any Guarantor not so released remains liable
for the full amount of principal of and interest on the Securities and the other
obligations of the Company hereunder as provided in this Article Eleven.

 

73

 

SECTION 11.04.   Limitation
of Guarantor’s Liability.

 

Each Guarantor, and by its acceptance hereof each
Holder and the Trustee, hereby confirms that it is the intention of all such
parties that the guarantee by such Guarantor pursuant to its Guarantee not
constitute a fraudulent transfer or conveyance for purposes of title 11 of the
United States Code, as amended, the Uniform Fraudulent Conveyance Act, the
Uniform Fraudulent Transfer Act or any similar U.S. Federal or state or other
applicable law.  To effectuate the
foregoing intention, the Holders and such Guarantor hereby irrevocably agree
that the obligations of such Guarantor under the Guarantee shall be limited to
the maximum amount as will, after giving effect to all other contingent and
fixed liabilities of such Guarantor and after giving effect to any collections
from or payments made by or on behalf of any other Guarantor in respect of the
obligations of such other Guarantor under its Guarantee or pursuant to Section 11.05,
result in the obligations of such Guarantor under the Guarantee not
constituting such fraudulent transfer or conveyance.

 

SECTION 11.05.   Contribution.

 

In order to provide for just and equitable
contribution among the Guarantors, the Guarantors agree, inter se, that in the
event any payment or distribution is made by any Guarantor (a “Funding
Guarantor”) under the Guarantee, such Funding Guarantor shall be entitled
to a contribution from all other Guarantors in a pro rata amount, based on the
net assets of each Guarantor (including the Funding Guarantor), determined in
accordance with GAAP, subject to Section 11.04, for all payments, damages
and expenses incurred by that Funding Guarantor in discharging the Company’s
obligations with respect to the Securities or any other Guarantor’s obligations
with respect to the Guarantee.

 

SECTION 11.06.   Execution of Guarantee.

 

To further evidence their Guarantee to the Holders,
any Guarantor required to Guarantee the Securities
pursuant to Section 4.18 shall execute the endorsement of Guarantee in
substantially the form set forth in Exhibit A hereto, which endorsement
shall be delivered to each Holder to be attached to each Security.  Each such Guarantor hereby agrees that its
Guarantee set forth in Section 11.01 shall remain in full force and effect
notwithstanding any failure to endorse on each Security a notation of such
Guarantee.  Each such Guarantee shall be signed
on behalf of each Guarantor by its Chairman of the Board, its President or one
of its Vice Presidents prior to the authentication of the Security on which it
is endorsed, and the delivery of such Security by the Trustee, after the
authentication thereof hereunder, shall constitute due delivery of such
Guarantee on behalf of such Guarantor. 
Such signature upon the Guarantee may be manual or facsimile signature
of such officer and may be imprinted or otherwise reproduced on the Guarantee,
and in case such officer who shall have signed the Guarantee shall cease to be
such officer before the Security on which such Guarantee is endorsed shall have
been authenticated and delivered by the Trustee or disposed of by the Company,
such Security nevertheless may be authenticated and delivered or disposed of as
though the Person who signed the Guarantee had not ceased to be such officer of
the Guarantor.

 

74

 

SECTION 11.07.   [Reserved].

 

SECTION 11.08.   Guarantors
May Consolidate, Etc., on Certain Terms.

 

Except as otherwise provided in Section 11.03, a
Guarantor may not sell or otherwise dispose of all or substantially all of its
assets to, or consolidate with or merge with or into (whether or not such
Guarantor is the surviving Person), another Person, other than the Company or
another Guarantor, unless:

 

(1)                                  immediately after giving effect to that transaction, no
Default or Event of Default exists; and

 

(2)                                  either:

 

(a)                                  the
Person acquiring the property in any such sale or disposition or the Person
formed by or surviving any such consolidation or merger (if other than the
Guarantor) is a corporation organized or existing under the laws of the United
States, any state thereof or the District of Columbia or the jurisdiction of
organization of that Guarantor and assumes all the obligations of that
Guarantor under this Indenture and its Guarantee pursuant to a supplemental
indenture satisfactory to the Trustee; or

 

(b)                                 such sale or other disposition or consolidation or merger
complies with Section 4.05.

 

ARTICLE TWELVE

 

[RESERVED]

 

ARTICLE THIRTEEN

 

MISCELLANEOUS

 

SECTION 13.01.   Trust
Indenture Act Controls.

 

This Indenture is subject to the provisions of the TIA
that are required to be a part of this Indenture, and shall, to the extent
applicable, be governed by such provisions. 
If any provision of this Indenture modifies any TIA provision that may
be so modified, such TIA provision shall be deemed to apply to this Indenture
as so modified.  If any provision of this
Indenture excludes any TIA provision that may be so excluded, such TIA
provision shall be excluded from this Indenture.

 

The provisions of TIA Sections 310 through 317 that
impose duties on any Person (including the provisions automatically deemed
included unless expressly excluded by this Indenture) are a part of and govern
this Indenture, whether or not physically contained herein.

 

75

 

SECTION 13.02.   Notices.

 

Any notice or communication shall be sufficiently
given if in writing and delivered in person, by facsimile, by overnight
courier, or mailed by first-class mail addressed as follows:

 

if to the Company:

 

AEP Industries Inc.

125 Phillips Avenue

South Hackensack, NJ 07606

 

Attention:  Vice
President – Treasurer

 

	
  Facsimile:

  	
  (201) 807-2308

  
	
  Telephone:

  	
  (201) 807-2483

  

 

with a copy to:

 

Paul E. Gelbard, Esq.

Bachner, Tally, Polevoy & Misher 

380 Madison Avenue 

New York, NY 10017

 

	
  Facsimile:

  	
  (212) 297-0261

  
	
  Telephone:

  	
  (212) 503-2047

  

 

if to the Trustee:

 

The Bank of New York

101 Barclay Street, 8th Floor West 

New York, New York 10286

 

Attention: 
Corporate Trust Administration

 

	
  Facsimile:

  	
  (212) 815-5915

  
	
  Telephone:

  	
  (212) 815-5735

  

 

The Company or the Trustee by notice to the other may
designate additional or different addresses for subsequent notices or
communications.

 

All notices and communications (other than those sent
to Holders) shall be deemed to have been duly given:  at the time delivered by hand, if personally
delivered; five Business Days after being deposited in the mail, postage
prepaid, if mailed; when telephonic acknowledgment of receipt is obtained, if
telecopied; and the next Business Day after timely delivery to the courier, if
sent by overnight courier promising next Business Day delivery.

 

76

 

Any notice or communication to a Holder shall be
mailed, by first class mail, postage prepaid, or by overnight air courier
promising next Business Day delivery, including any notice delivered in
connection with TIA Sections 310(b), 313(c), 314(a) and 315(6), to him at
his address as set forth on the registration books of the Registrar and shall
be sufficiently given to him if so mailed within the time prescribed.  To the extent required by the TIA, any notice
or communication shall also be mailed to any Person described in TIA Section 313(c).

 

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

 

SECTION 13.03.   Communications by Holders with Other Holders.

 

Securityholders may communicate pursuant to TIA Section 312(b) with
other Securityholders with respect to their rights under this Indenture or the
Securities.  The Company, the Trustee,
the Registrar and any other person shall have the protection of TIA Section 312(c).

 

SECTION 13.04.   Certificate and Opinion as to Conditions Precedent.

 

Upon any request or application by the Company to the
Trustee to take or refrain from taking any action under this Indenture, the
Company shall furnish to the Trustee at the request of the Trustee:

 

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

 

(2)                                  an Opinion of Counsel in form and substance satisfactory to
the Trustee stating that, in the opinion of such counsel, all such conditions
precedent have been complied with; and

 

(3)                                  where applicable, a certificate or opinion by an independent
certified public accountant satisfactory to the Trustee that complies with TIA Section 314(c).

 

SECTION 13.05.   Statements
Required in Certificate or Opinion.

 

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

 

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

 

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

 

77

 

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

 

(4)                                  a
statement as to whether or not, in the opinion of such person, such condition
or covenant has been complied with; provided, however, that with
respect to matters of fact an Opinion of Counsel may rely on an Officers’ Certificate
or certificates of public officials.

 

SECTION 13.06.   Rules by Trustee, Paying Agent, Registrar.

 

The Trustee may make reasonable rules for action
by or at a meeting of Securityholders. 
The Paying Agent or Registrar may make reasonable rules for its
functions.

 

SECTION 13.07.   Governing Law.

 

The laws of the State of New York shall govern this
Indenture, the Securities and the Guarantee without regard to principles of
conflicts of law.

 

SECTION 13.08.   No
Recourse Against Others.

 

No director, officer, employee or stockholder of the
Company or any of its Subsidiaries, as such, shall have any liability for any
obligations of the Company or any Guarantor under the Securities, this
Indenture, the Guarantees or any claim based on, in respect of, or by reason
of, such obligations or their creation. 
Each Securityholder by accepting a Security waives and releases all such
liability.  The waiver and release are
part of the consideration for issuance of the Securities.

 

SECTION 13.09.   Successors.

 

All agreements of the Company in this Indenture and
the Securities shall bind its successor. 
All agreements of each Guarantor in this Indenture and the Guarantee of
such Guarantor shall bind its successor. 
All agreements of the Trustee in this Indenture shall bind its
successor.

 

SECTION 13.10.   Counterpart Originals.

 

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

 

SECTION 13.11.   Severability.

 

In case any provision in this Indenture, in the
Securities or in the Guarantee 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, and a Holder shall have no claim
therefor against any party hereto.

 

78

 

SECTION 13.12.   No
Adverse Interpretation of Other Agreements.

 

This Indenture may not be used to interpret another
indenture, loan or debt agreement of the Company or a Subsidiary.  Any such indenture, loan or debt agreement
may not be used to interpret this Indenture.

 

SECTION 13.13.   Legal Holidays.

 

If a payment date is not a Business Day at a place of
payment, payment may be made at that place on the next succeeding Business Day,
and no interest shall accrue for the intervening period.

 

79

 

SIGNATURES

 

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

 

	
   

  	
  AEP INDUSTRIES INC.

  
	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
  /s/
  James B. Rafferty

  	
   

  
	
   

  	
   

  	
  Name:  James B. Rafferty

  
	
   

  	
   

  	
  Title:  Vice President and Treasurer

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  THE BANK OF NEW YORK,

  
	
   

  	
   

  	
  as
  Trustee

  
	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
  /s/
  Robert A. Massimillo

  	
   

  
	
   

  	
   

  	
  Name:  Robert A. Massimillo

  
	
   

  	
   

  	
  Title:  Vice
  President

  

 

 

EXHIBIT A

 

AEP INDUSTRIES INC.

 

	
  CUSIP No.

  	
   

  	
  001031 AD 5 (Rule 144A)

  
	
   

  	
   

  	
  U0079K AB 4 (Regulation S)

  
	
   

  	
   

  	
  001031 AF 0 (Unrestricted)

  
	
   

  	
   

  	
   

  
	
  ISIN No.

  	
   

  	
  US001031AD55 (Rule 144A)

  
	
   

  	
   

  	
  USU0079KAB45 (Regulation S)

  
	
   

  	
   

  	
  US001031AF04 (Unrestricted)

  

 

 

	
  No.

  	
   

  	
  $

  

 

7.875% SENIOR NOTE
DUE 2013

 

AEP INDUSTRIES INC. promises to pay to CEDE &
CO. or registered assigns the principal sum of                 
Dollars on March 15, 2013.

 

Interest Payment Dates:  March 15 and September 15,
beginning September 15, 2005.

 

Record Dates:  March 1
and September 1, beginning September 1, 2005.

 

 

[SIGNATURE PAGE
FOLLOWS]

 

 

A-1

 

IN WITNESS WHEREOF, AEP INDUSTRIES INC. has caused
this instrument to be executed by the undersigned duly authorized officer.

 

	
   

  	
  AEP INDUSTRIES INC.

  
	
   

  	
   

  	
   

  
	
  Dated:

  	
  By:

  	
   

  	
   

  
	
   

  	
   

  	
  Name:

  
	
   

  	
   

  	
  Title:

  

 

 

Certificate of Authentication:

 

This is one of the 7.875% Senior Notes due 2013
referred to in the within-mentioned Indenture.

 

	
  THE BANK OF NEW YORK

  	
   

  
	
    as Trustee

  	
   

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
   

  
	
  By

  	
   

  	
   

  	
  Date:

  
	
   

  	
  Authorized Signatory

  	
   

  	
   

  

 

A-2

 

(REVERSE OF SECURITY)

 

AEP INDUSTRIES INC.

 

7.875% Senior Note due
2013

 

1.                                       Interest.

 

AEP Industries Inc., a Delaware corporation (the “Company”),
promises to pay interest at the rate of 7.875% per annum on the principal
amount of this Security semiannually commencing on September 15, 2005,
until the principal hereof is paid or made available for payment.  Interest on the Securities will accrue from
and including the most recent date to which interest has been paid or, if no
interest has been paid, from and including March 18, 2005, through but
excluding the date on which interest is paid. 
If an Interest Payment Date falls on a day that is not a Business Day,
the interest payment to be made on such Interest Payment Date will be made on
the next succeeding Business Day with the same force and effect as if made on
such Interest Payment Date, and no additional interest will accrue as a result
of such delayed payment.  Interest will
be computed on the basis of a 360-day year of twelve 30-day months.

 

2.                                       Method
of Payment.

 

The interest payable on the Securities, and punctually
paid or duly provided for, on any Interest Payment Date will, as provided in
the Indenture (as defined below), be paid to the Person in whose name this
Security is registered at the close of business on the regular record date,
which shall be the March 1 or September 1 (whether or not a Business
Day) next preceding such Interest Payment Date. 
Any such interest not so punctually paid or duly provided for, and any
interest payable on such defaulted interest (to the extent lawful), will
forthwith cease to be payable to the Holder on such regular record date and
shall be paid to the person in whose name this Security is registered at the
close of business on a special record date for the payment of such defaulted
interest to be fixed by the Company, notice of which shall be given to Holders
not less than 15 days prior to such special record date.  Payment of the principal of and interest on
this Security will be made at the agency of the Company maintained for that
purpose in New York, New York and at any other office or agency maintained by
the Company for such purpose, in such coin or currency of the United States of
America as at the time of payment is legal tender for payment of public and
private debts; provided, however, that at the option of the
Company payment of interest may be made by check mailed to the address of the
Person entitled thereto as such address shall appear in the Security register.

 

3.                                       Paying
Agent and Registrar.

 

Initially, The Bank of New York (the “Trustee”)
will act as Paying Agent and Registrar. 
The Company may change any Paying Agent, Registrar or co-Registrar
without notice to the Holders of Securities. 
The Company or any of its Subsidiaries may act as Registrar or
co-Registrar but may not act as Paying Agent.

 

A-3

 

 

4.                                       Indenture.

 

This Security is one of a duly authorized issue of
Securities of the Company, designated as its 7.875% Senior Notes due 2013 (the “Securities”),
issuable under an indenture dated as of March 18, 2005 (the “Indenture”),
between the Company and the Trustee.  The
Indenture pursuant to which the Securities are issued provides that an
unlimited aggregate principal amount of Securities may be issued
thereunder.  The terms of the Securities
include those stated in the Indenture and those made part of the Indenture by
the Trust Indenture Act of 1939 (the “Act”) (15 U.S. Code Sections
77aaa-77bbbb) as in effect on the date of the Indenture.  The Securities are subject to all such terms,
and Holders of Securities are referred to the Indenture and the Act for a
statement of them.  Each Securityholder,
by accepting a Security, agrees to be bound to all of the terms and provisions
of the Indenture, as the same may be amended from time to time.

 

Capitalized terms contained in this Security to the
extent not defined herein shall have the meanings assigned to them in the
Indenture.

 

5.                                       Optional
Redemption.

 

The Securities will be subject to redemption, at the
option of the Company, in whole or in part, at any time on or after March 15,
2009 and prior to maturity, upon not less than 30 nor more than 60 days’ notice
mailed to each Holder of Securities to be redeemed at its address appearing in
the register for the Securities, in amounts of $1,000 or an integral multiple
of $1,000, at the following redemption prices (expressed as percentages of
principal amount), plus accrued interest to but excluding the date fixed for
redemption (subject to the right of Holders on the relevant Record Date to
receive interest due on an interest payment date that occurs on or prior to the
date fixed for redemption), if redeemed during the 12-month period beginning March 15
of the years indicated:

 

	
  Year

  	
   

  	
  Percentage

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  2009

  	
   

  	
  103.938

  	
  %

  
	
  2010

  	
   

  	
  101.969

  	
  %

  
	
  2011 and thereafter

  	
   

  	
  100.000

  	
  %

  

 

In addition, prior to March 15, 2008, the Company
may redeem up to 35% of the Securities issued under the Indenture (including
any Additional Securities) with the net cash proceeds received by the Company
from one or more Equity Offerings, at a redemption price equal to 107.875% of
the principal amount thereof, plus accrued and unpaid interest to the date
fixed for redemption; provided, however, that at least 65% of the
aggregate principal amount of Securities issued under the Indenture (including
any Additional Securities) remains outstanding immediately after any such
redemption (excluding any Securities owned by the Company or any of its
Affiliates).  Notice of redemption
described in this paragraph must be mailed to Holders of Securities not later
than 60 days following the consummation of the relevant Equity Offering.

 

Prior to September 15, 2005, the Company may call
for redemption (the “Special Redemption”) up to $25.0 million principal amount
of the Securities issued under the Indenture

 

A-4

 

(including any Additional
Securities) with the cash proceeds received by the Company from the
Asia/Pacific Operations Sale, at a redemption price equal to 101% of the
principal amount thereof, plus accrued and unpaid interest to the date fixed
for redemption.  Notice of a Special
Redemption described in this paragraph must be mailed to Holders of Securities
not less than 30 days nor more than 60 days prior to the date of redemption,
but in no event later than September 15, 2005.

 

Selection of Securities for any partial redemption
shall be made by the Trustee, in accordance with the rules of any national
securities exchange on which the Securities may be listed or, if the Securities
are not so listed, pro rata or by lot or in such other manner as the Trustee shall
deem appropriate and fair.  Securities in
denominations larger than $1,000 may be redeemed in part but only in integral
multiples of $1,000.  Notice of
redemption will be mailed before the date fixed for redemption to each Holder
of Securities to be redeemed at his or her registered address.  On and after the date fixed for redemption,
interest will cease to accrue on Securities or portions thereof called for
redemption.

 

The Securities will not have the benefit of any
sinking fund.

 

6.                                       Offer
to Purchase upon Occurrence of a Change of Control.

 

Within 30 days following a Change of Control, the
Company will offer to purchase the Securities at a purchase price equal to 101%
of the principal amount thereof plus any accrued and unpaid interest thereon.

 

7.                                       Notice
of Redemption.

 

Notice of redemption will be mailed by first class
mail at least 30 days but not more than 60 days before the redemption date to
each Holder of Securities to be redeemed at his registered address.  Securities in denominations larger than
$1,000 may be redeemed in part.  On and
after the redemption date, interest ceases to accrue on those Securities or
portion of them called for redemption.

 

8.                                       Denominations;
Transfer; Exchange.

 

The Securities are in registered form without coupons
in denominations of $1,000 and integral multiples of $1,000.  A Holder may transfer or exchange Securities
in accordance with the Indenture.  The
Registrar may require a Holder, among other things, to furnish appropriate
endorsements and transfer documents and to pay any taxes and fees required by
law or permitted by the Indenture.  The
Registrar need not transfer or exchange any Securities selected for redemption.

 

9.                                       Persons
Deemed Owners.

 

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

 

A-5

 

10.                                 Unclaimed
Funds.

 

If funds for the payment of principal or interest
remain unclaimed for two years, the Trustee or Paying Agent will repay the
funds to the Company at its request. 
After such repayment Holders of Securities entitled to such funds must
look to the Company for payment unless an abandoned property law designates
another person.

 

11.                                 Discharge
Prior to Redemption or Maturity.

 

The Indenture will be discharged and canceled except
for certain Sections thereof, subject to the terms of the Indenture, upon the
payment of all the Securities or upon the irrevocable deposit with the Trustee
of funds or Government Obligations sufficient for such payment or redemption.

 

12.                                 Amendment;
Supplement; Waiver.

 

Subject to certain exceptions, the Indenture or the
Securities may be amended or supplemented with the consent of the Holders of at
least a majority in principal amount of the outstanding Securities, and any
past default or compliance with any provision may be waived with the consent of
the Holders of a majority in principal amount of the outstanding
Securities.  Without notice to or the
consent of any Holder, the Company, the Guarantors, if any, and the Trustee may
amend or supplement the Indenture or the Securities to cure any ambiguity,
defect or inconsistency, or to make any change that does not adversely affect
the rights of any Holder of Securities.

 

13.                                 Restrictive
Covenants.

 

The Indenture restricts, among other things, the
ability of the Company or any Restricted Subsidiary to permit any Liens to be
imposed on their assets, to make certain Restricted Payments and Investments,
to enter into certain Sale and Lease-Back Transactions, limits the Indebtedness
which the Company or any Restricted Subsidiary may incur and limits the terms
on which the Company may engage in certain Asset Dispositions.  The Company is also obligated under certain
circumstances to make an offer to purchase Securities with the net cash
proceeds of certain Asset Dispositions. 
The Company must report annually to the Trustee on compliance with the
covenants in the Indenture.

 

14.                                 Successor
Corporation.

 

Pursuant to the Indenture, the ability of the Company
to consolidate with, merge with or into or transfer its assets to another
Person is conditioned upon certain requirements, including certain financial
requirements applicable to the surviving Person.

 

15.                                 Defaults
and Remedies.

 

If an Event of Default shall occur and be continuing,
the principal of all of the outstanding Securities, plus all accrued and unpaid
interest, if any, to the date the Securities become due and payable, may be
declared due and payable in the manner and with the effect provided in the
Indenture.

 

A-6

 

16.                                 Trustee
Dealings with Company.

 

The Trustee in its individual or any other capacity,
may become the owner or pledgee of Securities and make loans to, accept
deposits from, and perform services for the Company or its Affiliates, and may
otherwise deal with the Company or its Affiliates, as if it were not Trustee.

 

17.                                 No
Recourse Against Others.

 

No director, officer, employee or stockholder, as
such, of the Company or any of its Subsidiaries shall have any liability for
any obligations of the Company or any Guarantor under the Securities, the
Guarantee or the Indenture or for any claim based on, in respect of or by
reason of such obligations or their creation. 
Each Holder of a Security by accepting a Security waives and releases
all such liability.  The waiver and
release are part of the consideration for the issue of the Securities.

 

18.                                 Authentication.

 

This Security shall not be valid until the Trustee
signs the certificate of authentication on the other side of this Security.

 

19.                                 Abbreviations.

 

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

 

20.                                 CUSIP
Numbers.

 

Pursuant to a recommendation promulgated by the
Committee on Uniform Security Identification Procedures, the Company has caused
CUSIP numbers to be printed on the Securities and has directed the Trustee to
use CUSIP numbers in notices of redemption as a convenience to
Securityholders.  No representation is
made as to the accuracy of such numbers either as printed on the Securities or
as contained in any notice of redemption and reliance may be placed only on the
other identification numbers placed thereon.

 

21.                                 Governing
Law.

 

The laws of the State of New York shall govern the
Indenture and this Security and the Guarantee without regard to principles of
conflicts of law.

 

The Company will furnish to any Holder of record of
Securities upon written request and without charge a copy of the Indenture.

 

A-7

 

[FORM OF NOTATION ON
SECURITY RELATING TO GUARANTEE]

 

SENIOR GUARANTEE

 

The Guarantor(s) (as defined in the Indenture referred
to in the Security upon which this notation is endorsed) hereby, jointly and
severally, unconditionally guarantee on a senior basis (such guarantee by each
Guarantor being referred to herein as the “Guarantee”) the due and
punctual payment of the principal of, premium, if any, and interest on the
Securities, whether at maturity, by acceleration or otherwise, the due and
punctual payment of interest on the overdue principal, premium and interest, if
any, on the Securities, and the due and punctual performance of all other
obligations of the Company to the Holders or the Trustee, all in accordance
with the terms set forth in Article Eleven of the Indenture.

 

The Guarantee shall not be valid or obligatory for any
purpose until the certificate of authentication on the Securities upon which
the Guarantee is noted shall have been executed by the Trustee under the
Indenture by the manual signature of one of its authorized officers.

 

This Guarantee shall be governed by and construed in
accordance with the laws of the State of New York without regard to principles
of conflicts of law.

 

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

 

	
   

  	
  [GUARANTORS]

  
	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
   

  	
   

  
	
   

  	
   

  	
  Name:

  
	
   

  	
   

  	
  Title:

  

 

A-8

 

ASSIGNMENT FORM

 

If you the Holder want to assign this Security, fill
in the form below and have your signature guaranteed:

 

I or we assign and transfer this Security to:

 

	
   

  
	
   

  
	
   

  

(Print or type name,
address and zip code and social security or tax ID number of assignee)

 

and irrevocably appoint                                                           ,
agent to transfer this Security on the books of the Company.  The agent may substitute another to act for him.

 

	
  Dated:

  	
   

  	
   

  	
  Signed:

  	
   

  	
   

  
	
   

  	
  (Sign exactly as name appears on the other

  side of this Security)

  

 

 

 

	
  Signature Guarantee:

  	
   

  

 

SIGNATURE GUARANTEE

 

Signatures must be guaranteed by an “eligible
guarantor institution” meeting the requirements of the Registrar, which
requirements include membership or participation in the Security Transfer Agent
Medallion Program (“STAMP”) or such other “signature guarantee program”
as may be determined by the Registrar in addition to, or in substitution for,
STAMP, all in accordance with the Securities Exchange Act of 1934, as amended.

 

A-9

 

OPTION OF HOLDER TO ELECT
PURCHASE

 

If you the Holder want to elect to have this Security
purchased by the Company, check the box: o

 

If you want to elect to have only part of this
Security purchased by the Company, state the amount:  $

 

	
  Dated:

  	
   

  	
   

  	
  Your signature:

  	
   

  	
   

  
	
   

  	
  (Sign exactly as name appears on the other

  side of this Security)

  

 

 

	
  Signature Guarantee:

  	
   

  

 

SIGNATURE GUARANTEE

 

Signatures must be guaranteed by an “eligible
guarantor institution” meeting the requirements of the Registrar, which
requirements include membership or participation in the Security Transfer Agent
Medallion Program (“STAMP”) or such other “signature guarantee program”
as may be determined by the Registrar in addition to, or in substitution for,
STAMP, all in accordance with the Securities Exchange Act of 1934, as amended.

 

A-10

 

EXHIBIT B

 

FORM OF CERTIFICATE
OF TRANSFER

 

AEP INDUSTRIES INC.

125 Phillips Avenue

South Hackensack, NJ 07606

 

Attention:

 

[Name and Address of Registrar]

 

Re:  7.875% Senior Notes due 2013

 

Reference is hereby made to the Indenture, dated as of
March 18, 2005 (the “Indenture”), between AEP Industries Inc. (the “Company”)
and The Bank of New York, as trustee. 
Capitalized terms used but not defined herein shall have the meanings
given to them in the Indenture.

 

                                      
(the “Transferor”) owns and proposes to transfer the Security[s] or
interest in such Security[s] specified in Annex A hereto, in the principal
amount at maturity of $                      
in such Security[s] or interests (the “Transfer”), to                                                        
(the “Transferee”), as further specified in Annex A hereto.  In connection with the Transfer, the
Transferor hereby certifies that:

 

[CHECK ALL THAT APPLY]

 

o                                    1.                                       Check
if Transferee will take delivery of a beneficial interest in the 144A Global
Security or a Definitive Security Pursuant to Rule 144A.  The Transfer is being effected pursuant to
and in accordance with Rule 144A under the Securities Act of 1933, as
amended (the “Securities Act”), and, accordingly, the Transferor hereby
further certifies that the beneficial interest or Definitive Security is being
transferred to a Person that the Transferor reasonably believed and believes is
purchasing the beneficial interest or Definitive Security for its own account,
or for one or more accounts with respect to which such Person exercises sole
investment discretion, and such Person and each such account is a “qualified
institutional buyer” within the meaning of Rule 144A in a transaction
meeting the requirements of Rule 144A and such Transfer is in compliance
with any applicable blue sky securities laws of any state of the United
States.  Upon consummation of the
proposed Transfer in accordance with the terms of the Indenture, the
transferred beneficial interest or Definitive Security will be subject to the
restrictions on transfer enumerated in the Private Placement Legend printed on
the 144A Global Security and/or the Definitive Security and in the Indenture
and the Securities Act.

 

o                                    2.                                       Check
if Transferee will take delivery of a beneficial interest in a Legended
Regulation S Global Security, or a Definitive Security pursuant to Regulation
S.  The Transfer is being effected
pursuant to and in accordance with Rule 903 or Rule 904 under the
Securities Act and, accordingly, the Transferor hereby further certifies that (i) the
Transfer is not being made to a person in the United States and (x) at the time
the buy order was originated, the Transferee was outside the United States or
such Transferor and any Person acting on its behalf

 

B-1

 

reasonably believed and
believes that the Transferee was outside the United States or (y) the
transaction was executed in, on or through the facilities of a designated
offshore securities market and neither such Transferor nor any Person acting on
its behalf knows that the transaction was prearranged with a buyer in the
United States, (ii) no directed selling efforts have been made in
contravention of the requirements of Rule 903(b) or Rule 904(b) of
Regulation S under the Securities Act, (iii) the transaction is not part
of a plan or scheme to evade the registration requirements of the Securities
Act and (iv) the transfer is not being made to a U.S. Person or for the
account or benefit of a U.S. Person 
(other than an Initial Purchaser). 
Upon consummation of the proposed transfer in accordance with the terms
of the Indenture, the transferred beneficial interest or Definitive Security
will be subject to the restrictions on transfer enumerated in the Private
Placement Legend printed on the Legended Regulation S Global Security and/or
the Definitive Security and in the Indenture and the Securities Act.

 

o                                    3.                                       Check
and complete if Transferee will take delivery of a Restricted Definitive
Security pursuant to any provision of the Securities Act other than Rule 144,
Rule 144A or Regulation S.  The
Transfer is being effected in compliance with the transfer restrictions
applicable to beneficial interests in Restricted Global Securities and
Restricted Definitive Securities and pursuant to and in accordance with the
Securities Act and any applicable blue sky securities laws of any state of the
United States, and accordingly the Transferor hereby further certifies that
(check one):

 

o                                    (a)                                  such
Transfer is being effected to the Company or a subsidiary thereof; or

 

o                                    (b)                                 such
Transfer is being effected to an Institutional Accredited Investor and pursuant
to an exemption from the registration requirements of the Securities Act other
than Rule 144A, Rule 144 or Rule 904, and the Transferor hereby
further certifies that it has not engaged in any general solicitation within
the meaning of Regulation D under the Securities Act and the Transfer complies
with the transfer restrictions applicable to Restricted Definitive Securities
and the requirements of the exemption claimed, which certification is supported
by (1) a certificate executed by the Transferee in the form of Exhibit D
to the Indenture and (2) an Opinion of Counsel provided by the Transferor
or the Transferee (a copy of which the Transferor has attached to this
certification), to the effect that such Transfer is in compliance with the
Securities Act.  Upon consummation of the
proposed transfer in accordance with the terms of the Indenture, the
transferred Definitive Security will be subject to the restrictions on transfer
enumerated in the Private Placement Legend printed on the Definitive Securities
and in the Indenture and the Securities Act.

 

4.                                       Check
if Transferee will take delivery of a beneficial interest in an Unrestricted
Global Security or of an Unrestricted Definitive Security.

 

o                                    (a)                                  Check
if Transfer is Pursuant to Rule 144. 
(i) The Transfer is being effected pursuant to and in accordance
with Rule 144 under the Securities Act and in compliance with the transfer
restrictions contained in the Indenture and any applicable blue sky securities
laws of any state of the United States and (ii) the restrictions on
transfer contained in the Indenture and the Private Placement Legend are not
required in order to maintain compliance with the Securities Act.  Upon consummation of the proposed Transfer in
accordance with the terms of the Indenture, the transferred beneficial interest
or Definitive Security will no longer be

 

B-2

 

subject to the
restrictions on transfer enumerated in the Private Placement Legend printed on
the Restricted Global Securities, on Restricted Definitive Securities and in
the Indenture.

 

o                                    (b)                                 Check
if Transfer is Pursuant to Regulation S. 
(i) The Transfer is being effected pursuant to and in accordance
with Rule 903 or Rule 904 under the Securities Act and in compliance
with the transfer restrictions contained in the Indenture and any applicable
blue sky securities laws of any state of the United States and, in the case of
a transfer from a Restricted Global Security or a Restricted Definitive
Security, the Transferor hereby further certifies that (a) the Transfer is
not being made to a person in the United States and (x) at the time the buy
order was originated, the Transferee was outside the United States or such
Transferor and any Person acting on its behalf reasonably believed and believes
that the Transferee was outside the United States or (y) the transaction was
executed in, on or through the facilities of a designated offshore securities
market and neither such Transferor nor any Person acting on its behalf knows
that the transaction was prearranged with a buyer in the United States, (b) no
directed selling efforts have been made in contravention of the requirements of
Rule 903(b) or Rule 904(b) of Regulation S under the
Securities Act, (c) the transaction is not part of a plan or scheme to
evade the registration requirements of the Securities Act and (d) the
transfer is not being made to a U.S. Person or for the account or benefit of a
U.S. Person, and (ii) the restrictions on transfer contained in the
Indenture and the Private Placement Legend are not required in order to
maintain compliance with the Securities Act. 
Upon consummation of the proposed Transfer in accordance with the terms of
the Indenture, the transferred beneficial interest or Definitive Security will
no longer be subject to the restrictions on transfer enumerated in the Private
Placement Legend printed on the Restricted Global Securities, on Restricted
Definitive Securities and in the Indenture.

 

o                                    (c)                                  Check
if Transfer is Pursuant to Other Exemption. 
(i) The Transfer is being effected pursuant to and in compliance
with an exemption from the registration requirements of the Securities Act
other than Rule 144, Rule 903 or Rule 904 and in compliance with
the transfer restrictions contained in the Indenture and any applicable blue
sky securities laws of any State of the United States and (ii) the
restrictions on transfer contained in the Indenture and the Private Placement
Legend are not required in order to maintain compliance with the Securities
Act.  Upon consummation of the proposed
Transfer in accordance with the terms of the Indenture, the transferred
beneficial interest or Definitive Security will not be subject to the restrictions
on transfer enumerated in the Private Placement Legend printed on the
Restricted Global Securities or Restricted Definitive Securities and in the
Indenture.

 

B-3

 

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

 

	
   

  	
  Dated:

  	
   

  	
   

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  [Insert Name of Transferor]

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
   

  	
   

  
	
   

  	
   

  	
  Name:

  
	
   

  	
   

  	
  Title:

  
						

 

B-4

 

ANNEX A TO CERTIFICATE OF
TRANSFER

 

1.                                       The
Transferor owns and proposes to transfer the following:

 

[CHECK ONE OF (a) OR
(b)]

 

o                                    (a)                                  a
beneficial interest in the:

 

(i)                                     144A
Global Security (CUSIP                     );
or

 

(ii)                                  Regulation
S Global Security (CUSIP                     );
or

 

o                                    (b)                                 a
Restricted Definitive Security.

 

2.                                       After
the Transfer the Transferee will hold:

 

[CHECK ONE]

 

o                                    (a)                                  a
beneficial interest in the:

 

(i)                                     144A
Global Security (CUSIP                     );
or

 

(ii)                                  Regulation
S Global Security (CUSIP                     );
or

 

(iii)                               Unrestricted Global
Security (CUSIP                     );
or

 

o                                    (b)                                 a
Restricted Definitive Security; or

 

o                                    (c)                                  an
Unrestricted Definitive Security,

 

in accordance with the terms of the Indenture.

 

B-5

 

EXHIBIT C

 

FORM OF CERTIFICATE
OF EXCHANGE

 

AEP INDUSTRIES INC.

125 Phillips Avenue

South Hackensack, NJ 07606

 

Attention:

 

[Name and Address of Registrar]

 

Re:  7.875% Senior Notes due 2013

 

(CUSIP                     )

 

Reference is hereby made to the Indenture, dated as of
March 18, 2005 (the “Indenture”), between AEP Industries Inc. (the “Company”)
and The Bank of New York, as trustee. 
Capitalized terms used but not defined herein shall have the meanings
given to them in the Indenture.

 

                                                    
(the “Owner”) owns and proposes to exchange the Security[s] or interest
in such Security[s] specified herein, in the principal amount at maturity of $                        
in such Security[s] or interests (the “Exchange”).  In connection with the Exchange, the Owner
hereby certifies that:

 

1.                                       Exchange
of Restricted Definitive Securities or Beneficial Interests in a Restricted
Global Security for Unrestricted Definitive Securities or Beneficial Interests
in an Unrestricted Global Security

 

o                                    (a)                                  Check
if Exchange is from beneficial interest in a Restricted Global Security to
beneficial interest in an Unrestricted Global Security.  In connection with the Exchange of the Owner’s
beneficial interest in a Restricted Global Security for a beneficial interest
in an Unrestricted Global Security in an equal principal amount at maturity,
the Owner hereby certifies (i) the beneficial interest is being acquired
for the Owner’s own account without transfer, (ii) such Exchange has been
effected in compliance with the transfer restrictions applicable to the Global
Securities and pursuant to and in accordance with the United States Securities
Act of 1933, as amended (the “Securities Act”), (iii) the
restrictions on transfer contained in the Indenture and the Private Placement
Legend are not required in order to maintain compliance with the Securities Act
and (iv) the beneficial interest in an Unrestricted Global Security is
being acquired in compliance with any applicable blue sky securities laws of
any state of the United States.

 

o                                    (b)                                 Check
if Exchange is from beneficial interest in a Restricted Global Security to
Unrestricted Definitive Security.  In
connection with the Exchange of the Owner’s beneficial interest in a Restricted
Global Security for an Unrestricted Definitive Security, the Owner hereby
certifies (i) the Definitive Security is being acquired for the Owner’s
own account without transfer, (ii) such Exchange has been effected in
compliance with the transfer restrictions

 

C-1

 

applicable to the
Restricted Global Securities and pursuant to and in accordance with the
Securities Act, (iii) the restrictions on transfer contained in the
Indenture and the Private Placement Legend are not required in order to
maintain compliance with the Securities Act and (iv) the Definitive
Security is being acquired in compliance with any applicable blue sky
securities laws of any state of the United States.

 

o                                    (c)                                  Check
if Exchange is from Restricted Definitive Security to beneficial interest in an
Unrestricted Global Security.  In
connection with the Owner’s Exchange of a Restricted Definitive Security for a
beneficial interest in an Unrestricted Global Security, the Owner hereby certifies
(i) the beneficial interest is being acquired for the Owner’s own account
without transfer, (ii) such Exchange has been effected in compliance with
the transfer restrictions applicable to Restricted Definitive Securities and
pursuant to and in accordance with the Securities Act, (iii) the
restrictions on transfer contained in the Indenture and the Private Placement
Legend are not required in order to maintain compliance with the Securities Act
and (iv) the beneficial interest is being acquired in compliance with any
applicable blue sky securities laws of any state of the United States.

 

o                                    (d)                                 Check
if Exchange is from Restricted Definitive Security to Unrestricted Definitive
Security.  In connection with the Owner’s
Exchange of a Restricted Definitive Security for an Unrestricted Definitive
Security, the Owner hereby certifies (i) the Unrestricted Definitive
Security is being acquired for the Owner’s own account without transfer, (ii) such
Exchange has been effected in compliance with the transfer restrictions
applicable to Restricted Definitive Securities and pursuant to and in
accordance with the Securities Act, (iii) the restrictions on transfer
contained in the Indenture and the Private Placement Legend are not required in
order to maintain compliance with the Securities Act and (iv) the
Unrestricted Definitive Security is being acquired in compliance with any
applicable blue sky securities laws of any state of the United States.

 

2.                                       Exchange
of Restricted Definitive Securities or Beneficial Interests in Restricted
Global Securities for Restricted Definitive Securities or Beneficial Interests
in Restricted Global Securities

 

o                                    (a)                                  Check
if Exchange is from beneficial interest in a Restricted Global Security to
Restricted Definitive Security.  In
connection with the Exchange of the Owner’s beneficial interest in a Restricted
Global Security for a Restricted Definitive Security with an equal principal
amount at maturity, the Owner hereby certifies that the Restricted Definitive
Security is being acquired for the Owner’s own account without transfer.  Upon consummation of the proposed Exchange in
accordance with the terms of the Indenture, the Restricted Definitive Security
issued will continue to be subject to the restrictions on transfer enumerated
in the Private Placement Legend printed on the Restricted Definitive Security
and in the Indenture and the Securities Act.

 

o                                    (b)                                 Check
if Exchange is from Restricted Definitive Security to beneficial interest in a
Restricted Global Security.  In
connection with the Exchange of the Owner’s Restricted Definitive Security for
a beneficial interest in the [CHECK ONE] :

 

o                                    144A
Global Security;

 

C-2

 

o                                    Regulation
S Global Security;

 

with an equal principal amount at maturity, the Owner
hereby certifies (i) the beneficial interest is being acquired for the
Owner’s own account without transfer and (ii) such Exchange has been
effected in compliance with the transfer restrictions applicable to the
Restricted Global Securities and pursuant to and in accordance with the
Securities Act, and in compliance with any applicable blue sky securities laws
of any state of the United States.  Upon
consummation of the proposed Exchange in accordance with the terms of the
Indenture, the beneficial interest issued will be subject to the restrictions
on transfer enumerated in the Private Placement Legend printed on the relevant
Restricted Global Security and in the Indenture and the Securities Act.

 

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

 

	
   

  	
  Dated:

  	
   

  	
   

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  [Insert Name of Transferor]

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
   

  	
   

  
	
   

  	
   

  	
  Name:

  
	
   

  	
   

  	
  Title:

  
						

 

C-3

 

EXHIBIT D

 

FORM OF CERTIFICATE
FROM

ACQUIRING INSTITUTIONAL ACCREDITED INVESTOR

 

In connection with our proposed purchase of $                        
aggregate principal amount of:

 

(a)                                  o                                    beneficial
interest in a Global Security, or

 

(b)                                 o                                    a
Definitive Security,

 

we confirm that:

 

1.                                       We
understand that any subsequent transfer of the Securities or any interest
therein is subject to certain restrictions and conditions set forth in the
Indenture and the undersigned agrees to be bound by, and not to resell, pledge
or otherwise transfer the Securities or any interest therein except in
compliance with, such restrictions and conditions and the Securities Act of
1933, as amended (the “Securities Act”).

 

2.                                       We
understand that the offer and sale of the Securities have not been registered
under the Securities Act, and that the Securities and any interest therein may
not be offered or sold except as permitted in the following sentence.  We agree, on our own behalf and on behalf of
any accounts for which we are acting as hereinafter stated, that if we should
sell the Securities or any interest therein, we shall do so only (A) to
the Company or any subsidiary thereof, (B) in accordance with Rule 144A
under the Securities Act to a “qualified institutional buyer” (as defined
therein), (C) to an institutional “accredited investor” (as defined below)
that, prior to such transfer, furnishes (or has furnished on its behalf by a
U.S. broker-dealer) to you and to the Company a signed letter substantially in
the form of this letter and an Opinion of Counsel in form reasonably acceptable
to the Company to the effect that such transfer is in compliance with the
Securities Act, (D) outside the United States in accordance with Rule 904
of Regulation S under the Securities Act, (E) pursuant to the provisions
of Rule 144(k) under the Securities Act or (F) pursuant to an
effective registration statement under the Securities Act, and we further agree
to provide to any person purchasing the Definitive Security or beneficial
interest in a Global Security from us in a transaction meeting the requirements
of clauses (A) through (E) of this paragraph a notice advising such
purchaser that resales thereof are restricted as stated herein.

 

3.                                       We
understand that, on any proposed resale of the Securities or beneficial
interest therein, we will be required to furnish to you and the Company such
certifications, legal opinions and other information as you and the Company may
reasonably require to confirm that the proposed sale complies with the
foregoing restrictions.  We further
understand that the Securities purchased by us will bear a legend to the
foregoing effect.

 

4.                                       We
are an institutional “accredited investor” (as defined in Rule 501(a)(1),
(2), (3) or (7) of Regulation D under the Securities Act) and have
such knowledge and experience in financial and business matters as to be
capable of evaluating the merits and risks of

 

D-1

 

our investment in the
Securities, and we and any accounts for which we are acting are each able to
bear the economic risk of our or its investment.

 

5.                                       We
are acquiring the Securities or beneficial interest therein purchased by us for
our own account or for one or more accounts (each of which is an institutional “accredited
investor”) as to each of which we exercise sole investment discretion.

 

The Trustee and the Company are entitled to rely upon
this letter and are irrevocably authorized to produce this letter or a copy
hereof to any interested party in any administrative or legal proceedings or
official inquiry with respect to the matters covered hereby.

 

	
  Dated:

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
  [Insert
  Name of Accredited Investor]

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
   

  	
   

  
	
   

  	
   

  	
  Name:

  
	
   

  	
   

  	
  Title:

  
						

 

D-2

Source: [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00081-of-00352.parquet"}, [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00081-of-00352.parquet"}]]