Document:

exv4w1

 

Exhibit 4.1

EXECUTION COPY

$1,600,000,000

FIVE-YEAR CREDIT AGREEMENT

dated as of

October 5, 2005

among

Johnson Controls, Inc.,

as Borrower and Guarantor,

The Eligible Subsidiaries Referred to Herein,

as Borrowers,

The Lenders Parties Hereto

and

JPMorgan Chase Bank, N.A.,

as Administrative Agent

 

J.P. Morgan Securities Inc.,

Sole Lead Arranger and Bookrunner

Bank of America, N.A.

Barclays Bank PLC

and

Citibank, N.A.,

Co-Syndication Agents

 

 

TABLE OF CONTENTS

	 	 	 	 	 
	 	 	Page
	ARTICLE 1
Definitions
	 	 	 	 
	 
	 	 	 	 
	Section 1.01. Definitions

	 	 	1	 
	Section 1.02. Accounting Terms and Determinations

	 	 	12	 
	Section 1.03. Types of Loans and Borrowings

	 	 	13	 
	 
	 	 	 	 
	ARTICLE 2
	 	 	 	 
	The Credits
	 	 	 	 
	 
	 	 	 	 
	Section 2.01. Commitments to Lend

	 	 	13	 
	Section 2.02. Notice of Borrowing

	 	 	15	 
	Section 2.03. Notice to Lenders; Funding of Loans

	 	 	15	 
	Section 2.04. Notes

	 	 	16	 
	Section 2.05. Maturity of Loans

	 	 	17	 
	Section 2.06. Interest Rates

	 	 	17	 
	Section 2.07. Fees

	 	 	18	 
	Section 2.08. Optional Termination or Reduction of Commitments

	 	 	19	 
	Section 2.09. Mandatory Termination of Commitments

	 	 	19	 
	Section 2.10. Optional Prepayments

	 	 	19	 
	Section 2.11. General Provisions as to Payments

	 	 	20	 
	Section 2.12. Funding Losses

	 	 	21	 
	Section 2.13. Computation of Interest and Fees

	 	 	21	 
	Section 2.14. Regulation D Compensation

	 	 	21	 
	Section 2.15. Method of Electing Interest Rates

	 	 	21	 
	Section 2.16. Determining Dollar Amounts; Related Mandatory Prepayments

	 	 	23	 
	Section 2.17. Additional Reserve Costs

	 	 	24	 
	Section 2.18. Judgment Currency

	 	 	25	 
	Section 2.19. Letters of Credit

	 	 	25	 
	Section 2.20. Increased Commitments, Additional Lenders

	 	 	29	 
	 
	 	 	 	 
	ARTICLE 3
	 	 	 	 
	 Conditions
	 	 	 	 
	 
	 	 	 	 
	Section 3.01. Effectiveness

	 	 	30	 
	Section 3.02. Borrowings and Issuances of Letters of Credit

	 	 	31	 
	Section 3.03. First Borrowing by Each Eligible Subsidiary

	 	 	32	 

 

 

	 	 	 	 	 
	 	 	Page
	ARTICLE 4
	 	 	 	 
	 Representations and Warranties of the Company
	 	 	 	 
	 
	 	 	 	 
	Section 4.01. Corporate Existence and Power

	 	 	33	 
	Section 4.02. Corporate and Governmental Authorization; No Contravention

	 	 	33	 
	Section 4.03. Binding Effect

	 	 	33	 
	Section 4.04. Financial Information

	 	 	33	 
	Section 4.05. Litigation

	 	 	34	 
	Section 4.06. Compliance with ERISA

	 	 	34	 
	Section 4.07. Environmental Matters

	 	 	35	 
	Section 4.08. Taxes

	 	 	35	 
	Section 4.09. Subsidiaries

	 	 	35	 
	Section 4.10. Not an Investment Company

	 	 	35	 
	Section 4.11. Full Disclosure

	 	 	36	 
	 
	 	 	 	 
	ARTICLE 5
	 	 	 	 
	 Covenants
	 	 	 	 
	 
	 	 	 	 
	Section 5.01. Information

	 	 	36	 
	Section 5.02. Payment of Obligations

	 	 	38	 
	Section 5.03. Maintenance of Property; Insurance

	 	 	38	 
	Section 5.04. Conduct of Business and Maintenance of Existence

	 	 	39	 
	Section 5.05. Compliance with Laws

	 	 	39	 
	Section 5.06. Inspection of Property, Books and Records

	 	 	39	 
	Section 5.07. Minimum Consolidated Stockholder’s Equity

	 	 	39	 
	Section 5.08. Negative Pledge

	 	 	39	 
	Section 5.09. Consolidation, Mergers and Sales of Assets

	 	 	40	 
	Section 5.10. Use of Proceeds

	 	 	41	 
	 
	 	 	 	 
	ARTICLE 6
	 	 	 	 
	 Defaults
	 	 	 	 
	 
	 	 	 	 
	Section 6.01. Events of Default

	 	 	41	 
	Section 6.02. Notice of Default

	 	 	43	 
	Section 6.03. Cash Cover

	 	 	43	 
	 
	 	 	 	 
	ARTICLE 7
	 	 	 	 
	 The Administrative Agent
	 	 	 	 
	 
	 	 	 	 
	Section 7.01. Appointment and Authorization

	 	 	44	 
	Section 7.02. Administrative Agent and Affiliates

	 	 	44	 
	Section 7.03. Action by Administrative Agent

	 	 	44	 
	Section 7.04. Consultation with Experts

	 	 	44	 
	Section 7.05. Liability of Administrative Agent

	 	 	44	 

ii

 

	 	 	 	 	 
	 	 	Page
	Section 7.06. Indemnification

	 	 	45	 
	Section 7.07. Credit Decision

	 	 	45	 
	Section 7.08. Successor Administrative Agent

	 	 	45	 
	Section 7.09. Administrative Agent’s Fee

	 	 	45	 
	Section 7.10. Co-Syndication Agents

	 	 	46	 
	 
	 	 	 	 
	ARTICLE 8
	 	 	 	 
	 Change in Circumstances
	 	 	 	 
	 
	 	 	 	 
	Section 8.01. Basis for Determining Interest Rate Inadequate or Unfair

	 	 	46	 
	Section 8.02. Illegality

	 	 	46	 
	Section 8.03. Increased Cost and Reduced Return

	 	 	47	 
	Section 8.04. Taxes

	 	 	48	 
	Section 8.05. Base Rate Loans Substituted for Affected Euro-Currency Loans
	 	 	50	 
	 
	 	 	 	 
	ARTICLE 9
	 	 	 	 
	 Representations and Warranties of Eligible Subsidiaries
	 	 	 	 
	 
	 	 	 	 
	Section 9.01. Corporate Existence and Power

	 	 	51	 
	Section 9.02. Corporate and Governmental Authorization; No Contravention

	 	 	51	 
	Section 9.03. Binding Effect

	 	 	52	 
	Section 9.04. Taxes

	 	 	52	 
	 
	 	 	 	 
	ARTICLE 10
	 	 	 	 
	 Guaranty
	 	 	 	 
	 
	 	 	 	 
	Section 10.01. The Guaranty

	 	 	52	 
	Section 10.02. Guaranty Unconditional

	 	 	52	 
	Section 10.03. Discharge Only Upon Payment In Full; Reinstatement In Certain Circumstances

	 	 	53	 
	Section 10.04. Waiver by the Company

	 	 	53	 
	Section 10.05. Subrogation

	 	 	53	 
	Section 10.06. Stay of Acceleration

	 	 	54	 
	 
	 	 	 	 
	ARTICLE 11
	 	 	 	 
	 Miscellaneous
	 	 	 	 
	 
	 	 	 	 
	Section 11.01. Notices

	 	 	54	 
	Section 11.02. No Waivers

	 	 	55	 
	Section 11.03. Expenses; Indemnification

	 	 	55	 
	Section 11.04. Sharing of Set-offs

	 	 	55	 
	Section 11.05. Amendments and Waivers

	 	 	56	 
	Section 11.06. Successors and Assigns

	 	 	57	 

iii

 

	 	 	 	 	 
	 	 	Page
	Section 11.07. Collateral

	 	 	59	 
	Section 11.08. Governing Law; Submission to Jurisdiction

	 	 	59	 
	Section 11.09. Counterparts; Integration

	 	 	59	 
	Section 11.10. Waiver of Jury Trial

	 	 	60	 
	Section 11.11. Confidentiality

	 	 	60	 

iv

 

	 	 	 	 	 
	 	 	 	 	Page
	COMMITMENT SCHEDULE	 	 
	 
	 	 	 	 
	PRICING SCHEDULE	 	 
	 
	 	 	 	 
	SCHEDULE I	 	 
	 
	 	 	 	 
	EXHIBIT A -

	 	Form of Note	 	 
	EXHIBIT B -

	 	Opinion of General Counsel of the Company	 	 
	EXHIBIT C -

	 	Opinion of Special Counsel of the Administrative Agent	 	 
	EXHIBIT D -

	 	Form of Election to Participate	 	 
	EXHIBIT E -

	 	Form of Election to Terminate	 	 
	EXHIBIT F -

EXHIBIT G -

	 	Opinion of Counsel of the Borrower (Borrowings by Eligible
Subsidiaries)

Assignment and Assumption Agreement	 	 
	EXHIBIT H -

	 	Mandatory Costs Rate	 	 
	EXHIBIT I -

	 	Extension Agreement	 	 

v

 

     AGREEMENT dated as of October 5, 2005 among JOHNSON CONTROLS, INC., the ELIGIBLE SUBSIDIARIES
referred to herein, the LENDERS from time to time parties hereto and JPMORGAN CHASE BANK, N.A., as
Administrative Agent.

     The parties hereto agree as follows:

ARTICLE 1

Definitions

     Section 1.01. Definitions. The following terms, as used herein, have the following
meanings:

     “Additional Lender” has the meaning set forth in Section 2.20(b).

     “Administrative Agent” means JPMorgan Chase Bank, N.A. in its capacity as agent for the
Lenders hereunder, and its successors in such capacity.

     “Administrative Questionnaire” means, with respect to each Lender, an administrative
questionnaire in the form prepared by the Administrative Agent and submitted to the Administrative
Agent (with a copy to the Company) duly completed by such Lender.

     “Alternative Currency” means Euro or Sterling.

     “Alternative Currency Loan” means a Loan that is made in an Alternative Currency pursuant to
the applicable Notice of Borrowing.

     “Applicable Lending Office” means, with respect to any Lender, (i) in the case of its Base
Rate Loans, its Domestic Lending Office and (ii) in the case of its Euro-Currency Loans, its
Euro-Currency Lending Office.

     “Assignee” has the meaning set forth in Section 11.06(c).

     “Base Rate” means, for any day, a rate per annum equal to the higher of (i) the Prime Rate for
such day and (ii) the sum of 1 / 2 of 1% plus the Federal Funds Rate for such day.

     “Base Rate Loan” means a Loan which bears interest at the Base Rate pursuant to the applicable
Notice of Borrowing or Notice of Interest Rate Election or the provisions of Section 2.06(a) or
Article 8.

     “Benefit Arrangement” means at any time an employee benefit plan within the meaning of Section
3(3) of ERISA which is not a Plan or a

 

 

Multiemployer Plan and which is maintained or otherwise contributed to by any member of the
ERISA Group.

     “Borrower” means the Company or any Eligible Subsidiary, as the context may require, and their
respective successors, and “Borrowers” means all of the foregoing. When used in relation to any
Loan or Letter of Credit, references to “the Borrower” are to the particular Borrower to which such
Loan is or is to be made or at whose request such Letter of Credit is or is to be issued.

     “Borrowing” has the meaning set forth in Section 1.03.

     “Cash Collateralize” means to pledge and deposit with or deliver to the Issuing Lender, as
collateral for the applicable outstanding Letter of Credit, cash or deposit account balances
pursuant to documentation in form and substance reasonably satisfactory to the Issuing Lender in an
amount equal to 105% of the face amount of such Letter of Credit. Each Borrower hereby grants to
the Issuing Lender, for the benefit of the Issuing Lender and the Lenders, a security interest in
all of its right, title and interest (if any) in such cash, deposit accounts and all balances
therein and all proceeds of the foregoing. Cash collateral shall be maintained in blocked interest
bearing (to the extent available) deposit accounts at the Issuing Lender.

     “Commitment” means (i) with respect to each Lender, the amount of such Lender’s Commitment, as
such amount is set forth opposite the name of such Lender on the Commitment Schedule, (ii) with
respect to any Additional Lender, the amount of the Commitment assumed by it pursuant to Section
2.20 and (iii) with respect to any Assignee, the amount of the transferor Lender’s Commitment
assigned to it pursuant to Section 11.06(c), in each case as such amount may be changed from time
to time pursuant to Section 2.09, 2.20 or 11.06(c); provided that, if the context so requires, the
term “Commitment” means the obligation of a Lender to extend credit up to such amount to the
Borrowers hereunder.

     “Commitment Schedule” means the Schedule attached hereto identified as such.

     “Company” means Johnson Controls, Inc., a Wisconsin corporation, and its successors.

     “Company’s 2004 Form 10-K” means the Company’s annual report on Form 10-K for 2004, as
amended, filed with the Securities and Exchange Commission pursuant to the Securities Exchange Act
of 1934.

     “Conduit” means a special purpose corporation which is engaged in making, purchasing or
otherwise investing in commercial loans in the ordinary course of its business.

2

 

     “Conduit Designation” has the meaning set forth in Section 11.06(f).

     “Consolidated Stockholders’ Equity” means at any date the stockholders’ equity of the Company
and its Consolidated Subsidiaries determined on a consolidated basis as of such date in accordance
with GAAP; provided that, for purposes hereof, the consolidated stockholders’ equity of the Company
and its Consolidated Subsidiaries shall be calculated without giving effect to (i) the application
of Financial Accounting Standards Board Statement No. 106 or (ii) the cumulative foreign currency
translation adjustment.

     “Consolidated Subsidiary” shall mean, as to any Person, each subsidiary of such Person
(whether now existing or hereafter created or acquired) the financial statements of which shall be
(or should have been) consolidated with the financial statements of such Person in accordance with
GAAP.

     “Co-Syndication Agents” means Bank of America, N.A., Barclays Bank plc and Citibank, N.A. in
their respective capacities as Co-Syndication Agents in connection with the credit facility
provided hereunder.

     “Credit Exposure” means, with respect to any Lender at any time, (i) the amount of its
Commitment (whether used or unused) at such time or (ii) if the Commitments have terminated in
their entirety, the sum of the aggregate Dollar Amount of its Loans at such time plus the aggregate
Dollar Amount of its Letter of Credit Liabilities at such time.

     “Debt” of any Person means at any date, without duplication, (i) all obligations of such
Person for borrowed money, (ii) all obligations of such Person evidenced by bonds, debentures,
notes or other similar instruments, (iii) all obligations of such Person to pay the deferred
purchase price of property or services, except trade accounts payable arising in the ordinary
course of business, (iv) all obligations of such Person as lessee which are capitalized in
accordance with GAAP, (v) all Debt (as defined in one of the other clauses of this definition) of
others secured by a Lien on any asset of such Person, whether or not such Debt is assumed by such
Person and (vi) all Debt of others Guaranteed by such Person; provided that Debt shall not include
obligations in respect of letters of credit to secure the performance of bids, trade contracts
(other than for Debt), operating leases, statutory obligations, surety and appeal bonds,
performance bonds and other obligations of a like nature incurred in the ordinary course of
business and letters of credit issued in connection with the Company’s self-insurance programs for
workman’s compensation, product liability and general liability.

     “Default” means any condition or event which constitutes an Event of Default or which with the
giving of notice or lapse of time or both would, unless cured or waived, become an Event of
Default.

3

 

     “Dollar Amount” means, at any time:

     (i) with respect to any Dollar-Denominated Loan, the principal amount thereof then
outstanding;

     (ii) with respect to any Alternative Currency Loan, the principal amount thereof then
outstanding in the relevant Alternative Currency, converted to Dollars in accordance with
Section 2.16(a); and

     (iii) with respect to any Letter of Credit Liabilities, (A) if denominated in
Dollars, the amount thereof and (B) if denominated in an Alternative Currency, the amount
thereof converted to Dollars in accordance with Section 2.16(b).

     “Dollar-Denominated Loan” means a Loan that is made in Dollars pursuant to the applicable
Notice of Borrowing.

     “Dollars” and the sign “$” mean lawful currency of the United States.

     “Domestic Business Day” means any day except a Saturday, Sunday or other day on which
commercial banks in New York City are authorized by law to close.

     “Domestic Lending Office” means, as to each Lender, its office located at its address set
forth in its Administrative Questionnaire (or identified in its Administrative Questionnaire as its
Domestic Lending Office) or such other office as such Lender may hereafter designate as its
Domestic Lending Office by notice to the Company and the Administrative Agent.

     “Effective Date” means the date this Agreement becomes effective in accordance with Section
3.01.

     “Election to Participate” means an Election to Participate substantially in the form of
Exhibit D hereto.

     “Election to Terminate” means an Election to Terminate substantially in the form of Exhibit E
hereto.

     “Eligible Subsidiary” means any Wholly-Owned Consolidated Subsidiary of the Company as to
which an Election to Participate shall have been delivered to the Administrative Agent and as to
which an Election to Terminate shall not have been delivered to the Administrative Agent. Each
such Election to Participate and Election to Terminate shall be duly executed on behalf of such
Wholly-Owned Consolidated Subsidiary and the Company in such number of copies as the Administrative
Agent may request. The delivery of an Election to Terminate shall not affect any obligation of an
Eligible Subsidiary theretofore

4

 

incurred. The Administrative Agent shall promptly give notice to the Lenders of the receipt
of any Election to Participate or Election to Terminate.

     “Environmental Laws” means any and all federal, state, local and foreign statutes, laws,
regulations, ordinances, rules, judgments, orders, decrees, permits, concessions, grants,
franchises, licenses, agreements or other governmental restrictions relating to the environment or
to emissions, discharges or releases of pollutants, contaminants, petroleum or petroleum products,
chemicals or industrial, toxic or hazardous substances or wastes into the environment including,
without limitation, ambient air, surface water, ground water, or land, or otherwise relating to the
manufacture, processing, distribution, use, treatment, storage, disposal, transport or handling of
pollutants, contaminants, petroleum or petroleum products, chemicals or industrial, toxic or
hazardous substances or wastes or the clean-up or other remediation thereof.

     “ERISA” means the Employee Retirement Income Security Act of 1974, as amended, or any
successor statute.

     “ERISA Group” means the Company, any Consolidated Subsidiary and all members of a controlled
group of corporations and all trades or businesses (whether or not incorporated) under common
control which, together with the Company or any Consolidated Subsidiary, are treated as a single
employer under Section 414 of the Internal Revenue Code.

     “Euro” means the single currency of the Participating Member States.

     “Euro-Currency Business Day” means a Euro-Dollar Business Day, unless such term is used in
connection with an Alternative Currency Borrowing or Alternative Currency Loan, in which case such
day shall only be a Euro-Currency Business Day if (i) commercial banks are open for international
business (including dealings in deposits in such Alternative Currency) in London and (ii) if such
Alternative Currency is Euro, the Trans-European Automated Real-time Gross settlement Express
Transfer (or “TARGET”) payment system is open for the settlement of payment in Euro.

     “Euro-Currency Lending Office” means, as to each Lender, its office, branch or affiliate
located at its address set forth in its Administrative Questionnaire (or identified in its
Administrative Questionnaire as its Euro-Currency Lending Office) or such other office, branch or
affiliate of such Lender as it may hereafter designate as its Euro-Currency Lending Office by
notice to the Company and the Administrative Agent; provided that any Lender may from time to time
by notice to the Company and the Administrative Agent designate separate Euro-Currency Lending
Offices for its Loans in different currencies, in which case all references herein to the
Euro-Currency Lending Office of such

5

 

Lender shall be deemed to refer to any or all of such offices, as the context may require.

     “Euro-Currency Loan” means either a Euro-Dollar Loan or an Alternative Currency Loan.

     “Euro-Currency Margin” means, at any date, the applicable rate per annum determined in
accordance with the Pricing Schedule.

     “Euro-Currency Rate” means a rate of interest determined pursuant to Section 2.06(b) on the
basis of a London Interbank Offered Rate.

     “Euro-Currency Reserve Percentage” means, for any day, that percentage (expressed as a
decimal) which is in effect on such day, as prescribed by the Board of Governors of the Federal
Reserve System (or any successor) for determining the maximum reserve requirement for a member bank
of the Federal Reserve System in New York City with deposits exceeding five billion dollars in
respect of “Eurocurrency liabilities” (or in respect of any other category of liabilities which
includes deposits by reference to which the interest rate on Euro-Currency Loans is determined or
any category of extensions of credit or other assets which includes loans by a non-United States
office of any Lender to United States residents).

     “Euro-Dollar Business Day” means any Domestic Business Day on which commercial banks are open
for international business (including dealings in Dollar deposits) in London.

     “Euro-Dollar Loan” means a Dollar-Denominated Loan that bears interest at a Euro-Currency Rate
pursuant to the applicable Notice of Borrowing or Notice of Interest Rate Election.

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

     “Existing Credit Agreements” means the Existing 364-Day Agreement and the Existing Multi-Year
Agreement.

     “Existing Multi-Year Agreement” means the $625,000,000 Five-Year Credit Agreement dated as of
October 8, 2003 among the Company, the Eligible Subsidiaries referred to therein, the banks parties
thereto, and JPMorgan Chase Bank, N.A., as Administrative Agent.

     “Existing 364-Day Agreement” means the $625,000,000 364-Day Credit Agreement dated as of
October 8, 2003 and amended and restated as of October 6, 2004, among the Company, the Eligible
Subsidiaries referred to therein, the banks parties thereto and JPMorgan Chase Bank, N.A., as
Administrative Agent.

6

 

     “Facility Fee Rate” means, at any date, the applicable rate per annum determined in accordance
with the Pricing Schedule.

     “Federal Funds Rate” means, for any day, the rate per annum (rounded upward, if necessary, to
the nearest 1/100th of 1%) equal to the weighted average of the rates on overnight Federal funds
transactions with members of the Federal Reserve System arranged by Federal funds brokers on such
day, as published by the Federal Reserve Bank of New York on the Domestic Business Day next
succeeding such day; provided that (i) if such day is not a Domestic Business Day, the Federal
Funds Rate for such day shall be such rate on such transactions on the next preceding Domestic
Business Day as so published on the next succeeding Domestic Business Day, and (ii) if no such rate
is so published on such next succeeding Domestic Business Day, the Federal Funds Rate for such day
shall be the average rate quoted to JPMorgan Chase Bank, N.A. on such day on such transactions as
determined by the Administrative Agent.

     “GAAP” shall mean generally accepted accounting principles as in effect from time to time.

     “Group of Loans” means, at any time, a group of Loans consisting of (i) all Loans to the same
Borrower which are Base Rate Loans at such time or (ii) all Loans which are Euro-Currency Loans in
the same currency to the same Borrower having the same Interest Period at such time, provided that,
if a Loan of any particular Lender is converted to or made as a Base Rate Loan pursuant to Article
8, such Loan shall be included in the same Group or Groups of Loans from time to time as it would
have been in if it had not been so converted or made.

     “Guarantee” by any Person means any obligation, contingent or otherwise, of such Person
directly or indirectly guaranteeing any Debt of any other Person and, without limiting the
generality of the foregoing, any obligation, direct or indirect, contingent or otherwise, of such
Person (i) to purchase or pay (or advance or supply funds for the purchase or payment of) such Debt
(whether arising by virtue of partnership arrangements, by agreement to keep-well, to purchase
assets, goods, securities or services, to take-or-pay, or to maintain financial statement
conditions or otherwise) or (ii) entered into for the purpose of assuring in any other manner the
holder of such Debt of the payment thereof or to protect such holder against loss in respect
thereof (in whole or in part); provided that the term Guarantee shall not include endorsements for
collection or deposit in the ordinary course of business. The term “Guarantee” used as a verb has
a corresponding meaning.

     “Increased Commitments” has the meaning set forth in Section 2.20(a).

     “Indemnitee” has the meaning set forth in Section 11.03(b).

7

 

     “Interest Period” means, with respect to each Euro-Currency Loan, the period commencing on the
date of borrowing specified in the applicable Notice of Borrowing or on the date specified in an
applicable Notice of Interest Rate Election and ending one, two, three or six months thereafter (or
such other period of time as may at the time be mutually agreed by the Borrower and the Lenders),
as the Borrower may elect in such notice; provided that:

     (a) any Interest Period which would otherwise end on a day which is not a
Euro-Currency Business Day shall be extended to the next succeeding Euro-Currency Business
Day unless such Euro-Currency Business Day falls in another calendar month, in which case
such Interest Period shall end on the next preceding Euro-Currency Business Day; and

     (b) any Interest Period which begins on the last Euro-Currency Business Day of a
calendar month (or on a day for which there is no numerically corresponding day in the
calendar month at the end of such Interest Period) shall end on the last Euro-Currency
Business Day of a calendar month; and

     (c) any Interest Period applicable to any Loan of any Lender which would otherwise
end after the Termination Date for such Lender shall end on the Termination Date for such
Lender.

     “Internal Revenue Code” means the Internal Revenue Code of 1986, as amended, or any successor
statute.

     “Issuing Lender” means JPMorgan Chase Bank, N.A. and any other Lender that may agree to issue
letters of credit hereunder pursuant to an instrument in form satisfactory to the Company, such
Lender and the Administrative Agent, in its capacity as issuer of a Letter of Credit hereunder.
Unless the contest otherwise requires, any reference herein to a “Lender” includes each Issuing
Lender.

     “LC Termination Date” means, at any time, the fifth Business Day prior to the earliest
Termination Date then in effect as to any Lender.

     “Lender” means each Person listed in the Commitment Schedule, each Additional Lender or
Assignee which becomes a Lender pursuant to Section 2.20 or 11.06(c), and their respective
successors.

     “Lender Affiliate” means, (a) with respect to any Lender, (i) an Affiliate of such Lender or
(ii) any entity (whether a corporation, partnership, trust or otherwise) that is engaged in making,
purchasing, holding or otherwise investing in bank loans and similar extensions of credit in the
ordinary course of its business and is administered or managed by such Lender or an Affiliate of
such

8

 

Lender and (b) with respect to any Lender that is a fund which invests in bank loans and
similar extensions of credit, any other fund that invests in bank loans and similar extensions of
credit and is managed by the same investment advisor as such Lender or by an Affiliate of such
investment advisor. As used in this definition, (x) “Affiliate” means, with respect to a specified
Person, another Person that directly, or indirectly through one or more intermediaries, Controls or
is Controlled by or is under common Control with such specified Person and (y) “Control” means
possession, directly or indirectly, of the power to direct or cause the direction of the management
or policies of a Person, whether through the ability to exercise voting power, by contract or
otherwise (and “Controlled” has a meaning correlative thereto).

     “Letter of Credit” means a letter of credit to be issued hereunder by the Issuing Lender in
accordance with Section 2.19.

     “Letter of Credit Liabilities” means, for any Lender and at any time, such Lender’s ratable
participation in the sum of (x) the amounts then owing by the Borrowers in respect of amounts drawn
under Letters of Credit and (y) the aggregate amount then available for drawing under all Letters
of Credit.

     “Lien” means, with respect to any asset, any mortgage, lien, pledge, charge, security interest
or encumbrance of any kind in respect of such asset. For the purposes of this Agreement, the
Company or any Consolidated Subsidiary shall be deemed to own subject to a Lien any asset which it
has acquired or holds subject to the interest of a vendor or lessor under any conditional sale
agreement, capital lease or other title retention agreement relating to such asset.

     “Loan” means a loan made by a Lender pursuant to Section 2.01; provided that, if any such loan
or loans (or portions thereof) are combined or subdivided pursuant to a Notice of Interest Rate
Election, the term “Loan” shall refer to the combined principal amount resulting from such
combination or to each of the separate principal amounts resulting from such subdivision, as the
case may be.

     “London Interbank Offered Rate” has the meaning set forth in Section 2.06(b).

     “London Office” means the office of the Administrative Agent identified on the signature pages
hereof as its London office, or such other office of the Administrative Agent as it may specify for
such purpose by notice to the other parties hereto.

     “Material Debt” means Debt (other than the Loans) of the Company and/or one or more of its
Consolidated Subsidiaries, arising in one or more related

9

 

or unrelated transactions, in an aggregate principal amount exceeding $100,000,000.

     “Material Plan” means at any time a Plan or Plans having aggregate Unfunded Liabilities in
excess of $100,000,000.

     “Multiemployer Plan” means at any time an employee pension benefit plan within the meaning of
Section 4001(a)(3) of ERISA to which any member of the ERISA Group is then making or accruing an
obligation to make contributions or has within the preceding five plan years made contributions,
including for these purposes any Person which ceased to be a member of the ERISA Group during such
five year period.

     “New York Office” means the office of the Administrative Agent identified on the signature
pages hereof as its New York office, or such other office of the Administrative Agent as it may
specify for such purpose by notice to the other parties hereto.

     “Notes” means promissory notes of a Borrower, substantially in the form of Exhibit A hereto,
evidencing the obligation of such Borrower to repay the Loans made to it, and “Note” means any one
of such promissory notes issued hereunder.

     “Notice of Borrowing” has the meaning set forth in Section 2.02.

     “Notice of Interest Rate Election” has the meaning set forth in Section 2.15.

     “Notice of Issuance” has the meaning set forth in Section 2.19(b).

     “Outstanding Amount” means, as to any Lender at any time, the sum of (i) the aggregate Dollar
Amount of Loans made by it outstanding at such time plus (ii) the aggregate Dollar Amount of its
Letter of Credit Liabilities at such time.

     “Parent” means, with respect to any Lender, any Person controlling such Lender.

     “Participant” has the meaning set forth in Section 11.06(b).

     “Participating Member States” means those members of the European Union from time to time
which adopt a single, shared currency.

     “PBGC” means the Pension Benefit Guaranty Corporation or any entity succeeding to any or all
of its functions under ERISA.

10

 

     “Person” means an individual, a corporation, a limited liability company, a partnership, an
association, a trust, a limited liability company or any other entity or organization, including a
government or political subdivision or an agency or instrumentality thereof.

     “Plan” means at any time an employee pension benefit plan (other than a Multiemployer Plan)
which is covered by Title IV of ERISA or subject to the minimum funding standards under Section 412
of the Internal Revenue Code and either (i) is maintained, or contributed to, by any member of the
ERISA Group for employees of any member of the ERISA Group or (ii) has at any time within the
preceding five years been maintained, or contributed to, by any Person which was at such time a
member of the ERISA Group for employees of any Person which was at such time a member of the ERISA
Group.

     “Pricing Schedule” means the Schedule attached hereto identified as such.

     “Prime Rate” means the rate of interest publicly announced by JPMorgan Chase Bank, N.A. in New
York City from time to time as its Prime Rate.

     “Quarterly Payment Date” means each March 31, June 30, September 30 and December 31.

     “Regulation U” means Regulation U of the Board of Governors of the Federal Reserve System, as
in effect from time to time.

     “Reimbursement Obligation” has the meaning set forth in Section 2.19(d).

     “Required Lenders” means at any time Lenders having more than 50% of the aggregate amount of
the Credit Exposures at such time.

     “Spot Rate” means, for any Alternative Currency on any day, the average of the Administrative
Agent’s spot buying and selling rates for the exchange of such Alternative Currency and Dollars as
of approximately 11:00 A.M. (London time) on such day.

     “Sterling” means the lawful currency of the United Kingdom.

     “Sterling Loan” means a Loan that is made in Sterling pursuant to the applicable Notice of
Borrowing.

     “Stop Issuance Notice” has the meaning set forth in Section 2.19(g).

     “Subsidiary” means, with respect to any Person, any corporation, association or other business
entity of which more than 50% of the total voting power of shares of stock (or comparable ownership
interests) entitled (without

11

 

regard to the occurrence of any contingency) to vote in the election of directors, managers or
trustees thereof is at the time owned or controlled, directly or indirectly, by that Person or one
or more of the other Subsidiaries of the Person or a combination thereof.

     “Termination Date” means, as to each Lender, October 5, 2010 or, in the case of any Lender,
such later date to which the Commitment of such Lender shall have been extended pursuant to Section
2.01(b) (or, if any of the foregoing days is not a Euro-Dollar Business Day, the next preceding
Euro-Dollar Business Day).

     “Total Outstanding Amount” means, at any time, the aggregate Dollar Amount of all Loans
outstanding at such time plus the aggregate Dollar Amount of the Letter of Credit Liabilities of
all Lenders at such time.

     “Type” refers to the determination whether a loan is a Base Rate Loan or a Euro-Dollar Loan.

     “Unfunded Liabilities” means, with respect to any Plan at any time, the amount (if any) by
which (i) the present value of all benefits under such Plan exceeds (ii) the fair market value of
all Plan assets allocable to such benefits (excluding any accrued but unpaid contributions), all
determined as of the then most recent valuation date for such Plan, but only to the extent that
such excess represents a potential liability of a member of the ERISA Group to the PBGC or any
other Person under Title IV of ERISA.

     “United States” means the United States of America, including the States and the District of
Columbia, but excluding its territories and possessions.

     “Wholly-Owned Consolidated Subsidiary” means any Consolidated Subsidiary all of the shares of
capital stock or other ownership interests of which (except directors’ qualifying shares) are at
the time directly or indirectly owned by the Company.

     Section 1.02. Accounting Terms and Determinations. Unless otherwise specified herein, all
accounting terms used herein shall be interpreted, all accounting determinations hereunder shall be
made, and all financial statements required to be delivered hereunder shall be prepared in
accordance with generally accepted accounting principles as in effect from time to time, applied on
a basis consistent (except for changes concurred in by the Company’s independent public
accountants) with the most recent audited consolidated financial statements of the Company and its
Consolidated Subsidiaries delivered to the Lenders; provided that, if the Company notifies the
Administrative Agent that the Company wishes to amend any covenant in Article 5 to eliminate the
effect of any change in generally accepted accounting principles on the operation of such covenant
(or if the Administrative Agent notifies the Company that the Required Lenders wish to

12

 

amend Article 5 for such purpose), then the Company’s compliance with such covenant shall be
determined on the basis of generally accepted accounting principles in effect immediately before
the relevant change in generally accepted accounting principles became effective, until either such
notice is withdrawn or such covenant is amended in a manner satisfactory to the Company and the
Required Lenders.

     Section 1.03. Types of Loans and Borrowings. The term “Borrowing” denotes the aggregation
of Loans of one or more Lenders to be made to a single Borrower pursuant to Article 2 on the same
date, all of which Loans are of the same Type and currency and, in the case of Euro-Currency Loans,
have the same initial Interest Period. Identification of a Borrowing by Type (e.g., a
“Euro-Currency Borrowing”) indicates that such Borrowing is comprised of Loans of such Type.

ARTICLE 2

The Credits

     Section 2.01. Commitments to Lend.

     (a) Committed Loans. Each Lender severally agrees, on the terms and conditions set forth in
this Agreement, to make loans (which may be denominated in Dollars or an Alternative Currency as
the Borrower elects pursuant to Section 2.02) to the Borrowers pursuant to this Section 2.01(a)
from time to time prior to its Termination Date in amounts such that (i) the Outstanding Amount of
such Lender shall at no time exceed the amount of such Lender’s Commitment and (ii) the Total
Outstanding Amount shall at no time exceed the aggregate amount of the Commitments. Within the
foregoing limits, any Borrower may borrow under this Section, repay or, to the extent permitted by
Section 2.10, prepay Loans and reborrow at any time prior to the Termination Date for any Lender
under this Section 2.01.

     (b) Minimum Borrowings. Each Borrowing under this Section 2.01 shall be in an aggregate
Dollar Amount of not less than $10,000,000 (except that any such Borrowing may be in the aggregate
Dollar Amount of the available Commitments) and shall be made from the several Lenders ratably in
proportion to their respective Commitments.

     (c) Extension of Commitments. (i) Each Lender’s Commitment may be extended, if at the time no
Event of Default has occurred and is continuing, in the manner set forth in this subsection (c), on
a single occasion on any anniversary of the date hereof (the “Extension Date”) for a period of one
year after the date on which the Commitment of such Lender would have been terminated. If the
Company wishes to request an extension of each Lender’s Commitment, it shall

13

 

give notice to that effect to the Administrative Agent not less than 45 days and not more than
90 days prior to the Extension Date then in effect, whereupon the Administrative Agent shall
promptly notify each of the Lenders of such request. Each Lender will use its best efforts to
respond to such request, whether affirmatively or negatively, as it may elect in its discretion,
within 30 days of such request to the Administrative Agent. If any Lender shall not have responded
affirmatively within such 30-day period, such Lender shall be deemed to have rejected the Company’s
proposal to extend its Commitment, and only the Commitments of those Lenders which have responded
affirmatively shall be extended, subject to receipt by the Administrative Agent of counterparts of
an Extension Agreement in substantially the form of Exhibit I hereto (the “Extension Agreement”)
duly completed and signed by the Company, the Administrative Agent and all of the Lenders which
have responded affirmatively. The Administrative Agent shall provide to the Company, no later than
10 days prior to the Extension Date for any such request, a list of the Lenders which have
responded affirmatively. The Extension Agreement shall be executed and delivered no later than
five days prior to the Extension Date, and no extension of the Commitments pursuant to this
subsection (c) shall be legally binding on any party hereto unless and until such Extension
Agreement is so executed and delivered by Lenders having at least 51% of the aggregate amount of
the Commitments.

     (ii) If any Lender rejects, or is deemed to have rejected, the Borrower’s proposal to extend
its Commitment (A) this Agreement shall terminate on the Termination Date with respect to such
Lender, (B) the Borrower shall pay to such Lender on the Termination Date any amounts due and
payable to such Lender on such date and (C) the Borrower may, if it so elects, designate a Person
not theretofore a Lender and acceptable to the Administrative Agent to become a Lender, or agree
with an existing Lender that such Lender’s Commitment shall be increased, provided that the
aggregate amount of the Commitments following any designation or agreement may not exceed the
aggregate amount of the Commitments as in effect immediately prior to the relevant request. Upon
execution and delivery by the Borrower and such replacement Lender or other Person of an instrument
of assumption in form and amount satisfactory to the Administrative Agent and execution and
delivery of the Extension Agreement pursuant to subsection (c)(i), such existing Lender shall have
a Commitment as therein set forth or such other Person shall become a Lender with a Commitment as
therein set forth and all the rights and obligations of a Lender with such a Commitment hereunder.

     (iii) The Administrative Agent shall promptly notify the Lenders of the effectiveness of each
extension of the Commitments pursuant to this subsection (c).

14

 

     Section 2.02. Notice of Borrowing. The Borrower shall give the Administrative Agent notice
(a “Notice of Borrowing”) (1) at its New York Office not later than 10:30 A.M. (New York City
time) on (y) the date of each Base Rate Borrowing and (z) the third Euro-Dollar Business Day before
each Euro-Dollar Borrowing and (2) at its New York Office and its London Office not later than
10:30 A.M. (London time) on the third Euro-Currency Business Day before each Borrowing of
Alternative Currency Loans, specifying:

     (i) the date of such Borrowing, which shall be a Domestic Business Day in the case of
a Base Rate Borrowing or a Euro-Currency Business Day in the case of a Euro-Currency
Borrowing;

     (ii) the currency and aggregate amount (in such currency) of such Borrowing;

     (iii) in the case of a Borrowing of Dollar-Denominated Loans, whether such Loans are
to be Base Rate Loans or Euro-Dollar Loans; and

     (iv) in the case of a Euro-Currency Borrowing, the duration of the initial Interest
Period applicable thereto, subject to the provisions of the definition of Interest Period.

     Section 2.03. Notice to Lenders; Funding of Loans.

     (a) Upon receipt of a Notice of Borrowing, the Administrative Agent shall promptly notify each
Lender of the contents thereof and of such Lender’s share of such Borrowing and such Notice of
Borrowing shall not thereafter be revocable by the Borrower.

     (b) On the date of each Borrowing, each Lender participating therein shall make available its
ratable share of such Borrowing:

     (A) if such Borrowing is to be made in Dollars, not later than 2:00 P.M. (New York
City time), in Federal or other funds immediately available in New York City, to the
Administrative Agent at its New York Office; or

     (B) if such Borrowing is to be made in an Alternative Currency, in such Alternative
Currency (in such funds as may then be customary for the settlement of international
transactions in such Alternative Currency) to the account of the Administrative Agent at
its London Office.

Unless the Administrative Agent determines that any applicable condition specified in Article 3 has
not been satisfied or waived in accordance with Section

15

 

11.05, the Administrative Agent will make the funds so received from the Lenders available to the
Borrower as directed by the Borrower.

     (c) Unless the Administrative Agent shall have received at its New York Office notice from a
Lender prior to the date of any Borrowing that such Lender will not make available to the
Administrative Agent such Lender’s share of such Borrowing, the Administrative Agent may assume
that such Lender has made such share available to the Administrative Agent on the date of such
Borrowing in accordance with subsection (b) of this Section 2.03 and the Administrative Agent may,
in reliance upon such assumption, make available to the Borrower on such date a corresponding
amount. If and to the extent that such Lender shall not have so made such share available to the
Administrative Agent, such Lender and, if such Lender shall not have paid such amount to the
Administrative Agent within two Domestic Business Days of the Administrative Agent’s demand
therefor, the Borrower severally agree to repay to the Administrative Agent forthwith on demand
such corresponding amount together with interest thereon, for each day from the date such amount is
made available to the Borrower until the date such amount is repaid to the Administrative Agent, at
the Federal Funds Rate (if such Borrowing is in Dollars) or the applicable London Interbank Offered
Rate (if such Borrowing is in an Alternative Currency). If such Lender shall repay to the
Administrative Agent such corresponding amount, such amount so repaid shall constitute such
Lender’s Loan included in such Borrowing for purposes of this Agreement.

     (d) The failure of any Lender to make any Loan to be made by it on the date specified therefor
shall not relieve any other Lender of any obligation to make a Loan on such date.

     Section 2.04. Notes.

     (a) Each Lender may, by notice to the Company and the Agent, request (i) that its Loans to any
Borrower be evidenced by a single Note of such Borrower payable to the order of such Lender for the
account of its Applicable Lending Office in an amount equal to the aggregate unpaid principal
amount of such Lender’s Loans to such Borrower or (ii) that its Loans of a particular Type or
currency to any Borrower be evidenced by a separate Note of such Borrower in an amount equal to the
aggregate unpaid principal amount of such Loans. Each such Note shall be in substantially the form
of Exhibit A hereto with appropriate modifications to reflect the fact that it evidences solely
Loans of the relevant Type or currency. Each reference in this Agreement to the “Notes” of such
Lender shall be deemed to refer to and include any or all of such Notes, as the context may
require.

     (b) Each Lender shall record the date, amount, Type, currency and maturity of each Loan made
by it and the date and amount of each payment of

16

 

principal made with respect thereto, and may, if such Lender so elects in connection with any
transfer or enforcement of its Note, endorse on the schedule forming a part thereof appropriate
notations to evidence the foregoing information with respect to each such Loan then outstanding;
provided that the failure of any Lender to make any such recordation or endorsement shall not
affect the obligations of any Borrower hereunder or under the Notes. Each Lender is hereby
irrevocably authorized by the Borrowers so to endorse its Notes and to attach to and make a part of
any Note a continuation of any such schedule as and when required.

     Section 2.05. Maturity of Loans. Each Loan of each Lender shall mature, and the principal
amount thereof shall be due and payable (together with interest accrued thereon), on the
Termination Date of such Lender.

     Section 2.06. Interest Rates.

     (a) Each Base Rate Loan shall bear interest on the outstanding principal amount thereof, for
each day from the date such Loan is made until it becomes due, at a rate per annum equal to the
Base Rate for each such day. Such interest shall be payable at maturity, quarterly in arrears on
each Quarterly Payment Date prior to maturity and, with respect to the principal amount of any Base
Rate Loan converted to a Euro-Dollar Loan, on the date such amount is so converted. Any overdue
principal of or interest on any Base Rate Loan shall bear interest, payable on demand, for each day
from and including the date payment thereof was due to but excluding the date of actual payment, at
a rate per annum equal to the sum of 2% plus the rate otherwise applicable to Base Rate Loans for
each such day.

     (b) Each Euro-Currency Loan shall bear interest on the outstanding principal amount thereof,
for each day during each Interest Period applicable thereto, at a rate per annum equal to the sum
of the Euro-Currency Margin for such day plus the applicable London Interbank Offered Rate for such
Interest Period. Such interest shall be payable for each Interest Period on the last day thereof
and, if such Interest Period is longer than three months, at intervals of three months after the
first day thereof.

     The “London Interbank Offered Rate” applicable to any Euro-Currency Loan for any Interest
Period means the rate appearing on the Screen at approximately 11:00 A.M. (London time) on the Rate
Fixing Date as the rate for deposits in Dollars or the relevant Alternative Currency with a
maturity comparable to such Interest Period. If no rate appears on the Screen for the necessary
currency and period, then the “London Interbank Offered Rate” with respect to such Euro-Currency
Loan for such Interest Period shall be the rate at which deposits in that currency for value on the
first day of such Interest Period with a maturity comparable to such Interest Period are offered by
the principal

17

 

London office of the Administrative Agent in the London interbank market at approximately
11:00 A.M. (London time) on the Rate Fixing Date.

     The “Screen” means (i) with respect to Dollar-Denominated Loans, Telerate Page 3750 and (ii)
with respect to Alternative Currency Loans, the Telerate page selected by the Administrative Agent
that displays rates for inter-bank deposits in the appropriate Alternative Currency. The
Administrative Agent may nominate an alternative source of screen rates if these pages are replaced
by others which display rates for interbank deposits offered by leading banks in London.

     “Rate Fixing Date” means the second Euro-Currency Business Day before the first day of such
Interest Period.

     (c) Any overdue principal of or interest on any Euro-Currency Loan shall bear interest,
payable on demand, for each day from and including the date payment thereof was due to but
excluding the date of actual payment, at a rate per annum equal to the sum of 2% plus the higher of
(i) the sum of the Euro-Currency Margin for such day plus the London Interbank Offered Rate
applicable to such Loan on the day before such payment was due and (ii) the Euro-Currency Margin
for such day plus the quotient obtained (rounded upward, if necessary, to the next higher 1/100 of
1%) by dividing (x) the average (rounded upward, if necessary, to the next higher 1/16 of 1%) of
the respective rates per annum at which one day (or, if such amount due remains unpaid more than
three Euro-Currency Business Days, then for such other period of time not longer than six months as
the Administrative Agent may select) deposits in the relevant currency in an amount approximately
equal to such overdue payment are offered by the principal London office of the Administrative
Agent in the London interbank market for the applicable period determined as provided above by (y)
1.00 minus the Euro-Currency Reserve Percentage.

     (d) The Administrative Agent shall determine each interest rate applicable to the Loans
hereunder. The Administrative Agent shall give prompt notice to the Borrower and the Lenders of
each rate of interest so determined, and its determination thereof shall be conclusive in the
absence of manifest error.

     Section 2.07. Fees. (a) The Company shall pay to the Administrative Agent for the account
of the Lenders ratably a facility fee in Dollars at the Facility Fee Rate (determined daily in
accordance with the Pricing Schedule) on the daily aggregate amount of the Credit Exposures. Such
facility fee shall accrue from and including the Effective Date to but excluding the date on which
the Credit Exposures are reduced to zero.

     (b) The Borrower shall pay to the Administrative Agent (i) for the account of the Lenders
ratably a letter of credit fee in Dollars accruing daily on

18

 

the aggregate Dollar Amount of all outstanding Letters of Credit at the Letter of Credit Fee
Rate (determined daily in accordance with the Pricing Schedule) and (ii) for the account of each
Issuing Lender a letter of credit fronting fee accruing daily on the aggregate Dollar Amount of all
Letters of Credit issued by such Issuing Lender at a rate per annum mutually agreed from time to
time by the Company and such Issuing Lender.

     (c) Accrued fees under this Section shall be payable quarterly in arrears on each Quarterly
Date and on the date of termination of the Commitments in their entirety (and, if later, the date
the Credit Exposures are reduced to zero).

     Section 2.08. Optional Termination or Reduction of Commitments. The Company may, upon at
least three Domestic Business Days’ notice to the Administrative Agent at its New York Office, (i)
terminate the Commitments at any time, if no Loans or Letter of Credit Liabilities are outstanding
at such time or (ii) ratably reduce from time to time by an aggregate amount of $10,000,000 or any
larger multiple thereof, the aggregate amount of the Commitments in excess of the Total Outstanding
Amount. Promptly after receiving a notice pursuant to this Section, the Administrative Agent shall
notify each Lender of the contents thereof.

     Section 2.09. Mandatory Termination of Commitments. The Commitment of each Lender shall
terminate on its Termination Date.

     Section 2.10. Optional Prepayments.

     (a) Subject in the case of Euro-Currency Loans to Section 2.12, the Borrower may upon notice
to the Administrative Agent (i) at its New York Office not later than 10:30 A.M. (New York City
time) on the Domestic Business Day preceding the date of prepayment of any Group of Base Rate Loans
or the third Euro-Dollar Business Day before the date of prepayment of any Group of Euro-Dollar
Loans, prepay any such Group or (ii) at its London Office not later than 11:00 A.M. (London time)
on the third Euro-Currency Business Day before the date of prepayment, prepay any Group of
Alternative Currency Loans, in each case in whole at any time, or from time to time in part in
Dollar Amounts aggregating not less than $10,000,000, by paying the principal amount to be prepaid
together with accrued interest thereon to but not including the date of prepayment. Each such
optional prepayment shall be applied to prepay ratably the Loans of the several Lenders included in
such Group of Loans.

     (b) Upon receipt of a notice of prepayment pursuant to this Section, the Administrative Agent
shall promptly notify each Lender of the contents thereof and of such Lender’s ratable share of
such prepayment and once notice is so given to the Lenders, the Borrower’s notice of prepayment
shall not thereafter be revocable by the Borrower.

19

 

     Section 2.11. General Provisions as to Payments.

     (a) The Borrowers shall make each payment of principal of, and interest on, the
Dollar-Denominated Loans, of Letter of Credit Liabilities denominated in Dollars and of fees
hereunder not later than 2:00 P.M. (New York City time) on the date when due, in Federal or other
funds immediately available in New York City, without set-off, counterclaim or other deduction, to
the Administrative Agent at its New York Office. The Borrowers shall make each payment of principal
of, and interest on, the Alternative Currency Loans and of Letter of Credit Liabilities denominated
in an Alternative Currency in the relevant Alternative Currency in such funds as may then be
customary for the settlement of international transactions in such Alternative Currency, without
set-off, counterclaim or other deduction, to the Administrative Agent at its London Office. The
Administrative Agent will promptly distribute to each Lender its ratable share of each such payment
received by the Administrative Agent for the respective accounts of the Lenders. Whenever any
payment of principal of, or interest on, the Base Rate Loans or of fees shall be due on a day which
is not a Domestic Business Day, the date for payment thereof shall be extended to the next
succeeding Domestic Business Day. Whenever any payment of principal of, or interest on, the
Euro-Currency Loans shall be due on a day which is not a Euro-Currency Business Day, the date for
payment thereof shall be extended to the next succeeding Euro-Currency Business Day unless such
Euro-Currency Business Day falls in another calendar month, in which case the date for payment
thereof shall be the next preceding Euro-Currency Business Day. If the date for any payment of
principal is extended by operation of law or otherwise, interest thereon shall be payable for such
extended time.

     (b) Unless the Administrative Agent shall have received notice from the Borrower prior to the
date on which any payment is due to the Lenders hereunder that the Borrower will not make such
payment in full, the Administrative Agent may assume that the Borrower has made such payment in
full to the Administrative Agent on such date and the Administrative Agent may, in reliance upon
such assumption, cause to be distributed to each Lender on such due date an amount equal to the
amount then due such Lender. If and to the extent that the Borrower shall not have so made such
payment, each Lender shall repay to the Administrative Agent forthwith on demand such amount
distributed to such Lender together with interest thereon, for each day from the date such amount
is distributed to such Lender until the date such Lender repays such amount to the Administrative
Agent, at (i) the Federal Funds Rate (if such amount was distributed in Dollars) or (ii) the rate
per annum at which one-day deposits in the relevant currency are offered by the principal London
office of the Administrative Agent in the London interbank market for such day (if such amount was
distributed in an Alternative Currency).

20

 

     Section 2.12. Funding Losses. If the Borrower makes any payment of principal with respect
to any Euro-Currency Loan or any Euro-Dollar Loan is converted to a Base Rate Loan (pursuant to
Article 2, 6 or 8 or otherwise) on any day other than the last day of an Interest Period applicable
thereto, or the last day of an applicable period fixed pursuant to Section 2.06(c), or if the
Borrower fails to borrow, prepay, convert or continue any Euro-Currency Loans after notice has been
given to any Lender in accordance with Section 2.03(a), 2.10(b), or 2.15, the Borrower shall
reimburse each Lender within 15 days after demand for any resulting loss or expense reasonably
incurred by it (or by an existing or prospective Participant in the related Loan) in obtaining,
liquidating or employing deposits or other funds from third parties, but excluding loss of margin
for the period after any such payment or conversion or failure to borrow, prepay, convert or
continue; provided that such Lender shall have delivered to the Borrower a certificate specifying
in reasonable detail the calculation of, and the reasons for, the amount of such loss or expense,
which certificate shall be conclusive in the absence of manifest error.

     Section 2.13. Computation of Interest and Fees. Interest on Euro-Currency Loans denominated
in Sterling and interest calculated on the basis of the Prime Rate shall be computed on the basis
of a year of 365 days (or 366 days in a leap year) and paid for the actual number of days elapsed
(including the first day but excluding the last day). All other interest and fees shall be computed
on the basis of a year of 360 days and paid for the actual number of days elapsed (including the
first day but excluding the last day).

     Section 2.14. Regulation D Compensation. Each Lender may require the Borrower to pay,
contemporaneously with each payment of interest on the Euro-Currency Loans, additional interest on
the related Euro-Currency Loan of such Lender at a rate per annum determined by such Lender up to
but not exceeding the excess of (i) (A) the applicable London Interbank Offered Rate divided by (B)
one minus the Euro-Currency Reserve Percentage over (ii) the applicable London Interbank Offered
Rate. Any Lender wishing to require payment of such additional interest (x) shall so notify the
Borrower and the Administrative Agent, in which case such additional interest on the Euro-Currency
Loans of such Lender shall be payable to such Lender at the place indicated in such notice with
respect to each Interest Period commencing at least three Euro-Currency Business Days after the
giving of such notice, and (y) shall notify the Borrower at least five Euro-Currency Business Days
prior to each date on which interest is payable on the Euro-Currency Loans of the amount then due
it under this Section.

     Section 2.15. Method of Electing Interest Rates.

     (a) The Dollar-Denominated Loans included in each Borrowing shall initially be of the Type
specified by the Borrower in the applicable Notice of Borrowing. Thereafter, the Borrower may from
time to time elect to change or

21

 

continue the Type of each such Group of Loans (subject to subsection 2.15(d) of this Section
and the provisions of Article 8), as follows:

     (i) if such Loans are Base Rate Loans, the Borrower may elect to convert such Loans
to Euro-Dollar Loans as of any Euro-Dollar Business Day; and

     (ii) if such Loans are Euro-Dollar Loans, the Borrower may elect to convert such
Loans to Base Rate Loans or elect to continue such Loans as Euro-Dollar Loans for an
additional Interest Period, subject to Section 2.12 if any such conversion is effective on
any day other than the last day of an Interest Period applicable to such Loans.

     Each such election shall be made by delivering a notice (a “Notice of Interest Rate Election”)
to the Administrative Agent at its New York Office not later than 10:30 A.M. (New York City time)
on the third Euro-Dollar Business Day before the conversion or continuation selected in such notice
is to be effective. A Notice of Interest Rate Election may, if it so specifies, apply to only a
portion of the aggregate principal amount of the relevant Group of Loans; provided that (i) such
portion is allocated ratably among the Loans comprising such Group and (ii) the portion to which
such Notice applies, and the remaining portion to which it does not apply, are each at least
$10,000,000 (unless such portion is comprised of Base Rate Loans). If no such notice is timely
received before the end of an Interest Period for any Group of Euro-Dollar Loans, the Borrower
shall be deemed to have elected that such Group of Loans be converted to Base Rate Loans at the end
of such Interest Period.

     (b) Each Notice of Interest Rate Election shall specify:

     (i) the Group of Loans (or portion thereof) to which such notice applies;

     (ii) the date on which the conversion or continuation selected in such notice is to
be effective, which shall comply with the applicable clause of Section 2.15(a) above;

     (iii) if the Loans comprising such Group are to be converted, the new Type of Loans
and, if the Loans resulting from such conversion are to be Euro-Dollar Loans, the duration
of the next succeeding Interest Period applicable thereto; and

     (iv) if such Loans are to be continued as Euro-Dollar Loans for an additional
Interest Period, the duration of such additional Interest Period.

22

 

     Each Interest Period specified in a Notice of Interest Rate Election shall comply with the
provisions of the definition of Interest Period.

     (c) Promptly after receiving a Notice of Interest Rate Election from the Borrower pursuant to
subsection (a) above, the Administrative Agent shall notify each Lender of the contents thereof and
such notice shall not thereafter be revocable by the Borrower.

     (d) The Borrower shall not be entitled to elect to convert any Loans to, or continue any Loans
for an additional Interest Period as, Euro-Dollar Loans if (i) the aggregate Dollar Amount of any
Group of Euro-Dollar Loans created or continued as a result of such election would be less than
$10,000,000 or (ii) a Default shall have occurred and be continuing when the Borrower delivers
notice of such election to the Administrative Agent.

     (e) The initial Interest Period for each Borrowing of Alternative Currency Loans shall be
specified by the Borrower in the applicable Notice of Borrowing. The Borrower may specify the
duration of each subsequent Interest Period applicable to such Group of Loans by delivering to the
Administrative Agent at its London Office not later than 11:00 A.M. (London time) on the third
Euro-Currency Business Day before the end of the immediately preceding Interest Period, a notice
specifying the Group of Loans to which such notice applies and the duration of such subsequent
Interest Period (which shall comply with the provisions of the definition of Interest Period).
Such notice may, if it so specifies, apply to only a portion of the aggregate principal amount of
the relevant Group of Loans; provided that (i) such portion is allocated ratably among the Loans
comprising such Group and (ii) the Dollar Amounts of the portion to which such notice applies, and
the remaining portion to which it does not apply, are each at least $10,000,000. If no such notice
is timely received by the Administrative Agent before the end of any applicable Interest Period,
the Borrower shall be deemed to have elected that the subsequent Interest Period for such Group of
Loans shall have a duration of one month (subject to the provisions of the definition of Interest
Period).

     Section 2.16. Determining Dollar Amounts; Related Mandatory Prepayments.

     (a) The Administrative Agent shall determine the Dollar Amount of each Alternative Currency
Loan as of the first day of each Interest Period applicable thereto and, in the case of any such
Interest Period of more than three months, at three-month intervals after the first day thereof,
and shall promptly notify the Borrower and the Lenders of each Dollar Amount so determined by it.
Each such determination shall be based on the Spot Rate (i) on the date of the related Notice of
Borrowing for purposes of the initial such determination for any Alternative Currency Loan and (ii)
on the fourth Euro-Currency Business Day

23

 

prior to the date as of which such Dollar Amount is to be determined, for purposes of any
subsequent determination.

     (b) The Administrative Agent shall determine the Dollar Amount of the Letter of Credit
Liabilities related to each Letter of Credit as of the date of issuance thereof and at three-month
intervals after the date of issuance thereof. Each such determination shall be based on the Spot
Rate (i) on the date of the related Notice of Issuance, in the case of the initial determination in
respect of any Letter of Credit and (ii) on the fourth Euro-Currency Business Day prior to the date
as of which such Dollar Amount is to be determined, in the case of any subsequent determination
with respect to an outstanding Letter of Credit.

     (c) Each determination of a Dollar Amount pursuant to this Section shall be conclusive in the
absence of manifest error. If after giving effect to any such determination of a Dollar Amount,
the Total Outstanding Amount exceeds the aggregate amount of the Commitments, the Borrowers shall
within five Euro-Currency Business Days prepay outstanding Loans (as selected by the Company and
notified to the Lenders through the Administrative Agent not less than three Euro-Currency Business
Days prior to the date of prepayment) or take other action to the extent necessary to eliminate any
such excess.

     Section 2.17. Additional Reserve Costs.

     (a) If and so long as any Lender is required to make special deposits with the Bank of
England, to maintain reserve asset ratios or to pay fees, in each case in respect of such Lender’s
Euro-Currency Loans in any Alternative Currency, such Lender may require the Borrower to pay,
contemporaneously with each payment of interest on each of such Loans, additional interest on such
Loan at a rate per annum equal to the Mandatory Costs Rate calculated in accordance with the
formula and in the manner set forth in Exhibit H hereto.

     (b) If and so long as any Lender is required to comply with reserve assets, liquidity, cash
margin or other requirements of any monetary or other authority (including any such requirement
imposed by the European Central Bank or the European System of Central Banks, but excluding
requirements reflected in an applicable Euro-Currency Reserve Percentage or Mandatory Costs Rate)
in respect of any of such Lender’s Euro-Currency Loans in any Alternative Currency, such Lender may
require the Borrower to pay, contemporaneously with each payment of interest on each of such
Lender’s Euro-Currency Loans subject to such requirements, additional interest on such Loan at a
rate per annum specified by such Lender to be the cost to such Lender of complying with such
requirements in relation to such Loan.

     (c) Any additional interest owed pursuant to subsection (a) or (b) above shall be determined
by the relevant Lender, which determination shall be

24

 

conclusive in the absence of manifest error, and notified to the Borrower (with a copy to the
Administrative Agent) at least five Euro-Currency Business Days before each date on which interest
is payable for the relevant Loan, and such additional interest so notified to the Borrower by such
Lender shall be payable to the Administrative Agent for the account of such Lender on each date on
which interest is payable for such Loan.

     Section 2.18. Judgment Currency. If, under any applicable law and whether pursuant to a
judgment being made or registered against any Borrower or for any other reason, any payment under
or in connection with this Agreement is made or satisfied in a currency (the “Other Currency”)
other than that in which the relevant payment is due (the “Required Currency”) then, to the extent
that the payment (when converted into the Required Currency at the rate of exchange on the date of
payment or, if it is not practicable for the party entitled thereto (the “Payee”) to purchase the
Required Currency with the Other Currency on the date of payment, at the rate of exchange as soon
thereafter as it is practicable for it to do so) actually received by the Payee falls short of the
amount due under the terms of this Agreement, such Borrower shall, to the extent permitted by law,
as a separate and independent obligation, indemnify and hold harmless the Payee against the amount
of such short-fall. For the purpose of this Section, “rate of exchange” means the rate at which
the Payee is able on the relevant date to purchase the Required Currency with the Other Currency
and shall take into account any premium and other costs of exchange.

     Section 2.19. Letters of Credit. (a) Subject to the terms and conditions hereof, each
Issuing Lender agrees to issue Letters of Credit hereunder denominated in Dollars or in an
Alternative Currency from time to time upon the request of any Borrower; provided that, immediately
after each Letter of Credit is issued (i) the Total Outstanding Amount shall not exceed the
aggregate amount of the Commitments and (ii) the aggregate Dollar Amount of Letter of Credit
Liabilities shall not exceed $200,000,000. Upon the date of issuance by the Issuing Lender of a
Letter of Credit, the Issuing Lender shall be deemed, without further action by any party hereto,
to have sold to each Lender, and each Lender shall be deemed, without further action by any party
hereto, to have purchased from the Issuing Lender, a participation in such Letter of Credit and the
related Letter of Credit Liabilities in the proportion their respective Commitments bear to the
aggregate Commitments.

     (b) The Borrower shall give the Issuing Lender notice at least five Euro-Currency Business
Days prior to the requested issuance of a Letter of Credit specifying the date such Letter of
Credit is to be issued, and describing the terms of such Letter of Credit and the nature of the
transactions to be supported thereby (such notice, including any such notice given in connection
with the extension , renewal or amendment of a Letter of Credit, a “Notice of Issuance”). Upon
receipt of a Notice of Issuance, the Issuing Lender shall promptly notify the

25

 

Administrative Agent, and the Administrative Agent shall promptly notify each Lender of the
contents thereof and of the amount of such Lender’s participation in such Letter of Credit. The
issuance by the Issuing Lender of each Letter of Credit shall, in addition to the conditions
precedent set forth in Article 3, be subject to the conditions precedent that (i) such Letter of
Credit shall be in such form and contain such terms as shall be satisfactory to the Issuing Lender
and the Borrower shall have executed and delivered such other instruments and agreements relating
to such Letter of Credit as the Issuing Lender shall have reasonably requested and (ii) no Stop
Issuance Notice shall be in effect. The Borrower shall also pay to the Issuing Lender for its own
account issuance, drawing, amendment and extension charges in the amounts and at the times as
agreed between the Borrower and the Issuing Lender.

     (c) The extension, renewal or amendment of any Letter of Credit shall be deemed to be an
issuance of such Letter of Credit, and if any Letter of Credit contains a provision pursuant to
which it is deemed to be extended unless notice of termination is given by the Issuing Lender, the
Issuing Lender shall timely give such notice of termination unless it has theretofore timely
received a Notice of Issuance and the other conditions to issuance of a Letter of Credit have also
theretofore been met with respect to such extension. Each Letter of Credit shall expire at or
before the close of business on the date that is one year after such Letter of Credit is issued
(or, in the case of any renewal or extension thereof, one year after such renewal or extension);
provided that (i) a Letter of Credit may contain a provision pursuant to which it is deemed to be
extended on an annual basis unless notice of termination is given by the Issuing Bank and (ii) in
no event will a Letter of Credit expire (including pursuant to a renewal or extension thereof) on a
date later than the LC Termination Date.

     (d) Upon receipt from the beneficiary of any Letter of Credit of any notice of a drawing under
such Letter of Credit, the Issuing Lender shall notify the Administrative Agent and the
Administrative Agent shall promptly notify the Borrower and each other Lender as to the amount to
be paid as a result of such demand or drawing and the payment date. The Borrower shall be
irrevocably and unconditionally obligated forthwith to reimburse the Issuing Lender for any amounts
paid by the Issuing Lender upon any drawing under any Letter of Credit in the currency of such
payment (a “Reimbursement Obligation”) without presentment, demand, protest or other formalities of
any kind. All such amounts paid by the Issuing Lender and remaining unpaid by the Borrower shall
bear interest, payable on demand, for each day from the date of payment under the Letter of Credit
until paid at a rate per annum equal to the sum of 2% plus (i) if such amount is denominated in
Dollars, the Base Rate for such day and (ii) if such amount is denominated in an Alternative
Currency, the sum of the Euro-Currency Margin plus the rate per annum at which one-day deposits in
the relevant currency are offered by the principal London office of the Administrative Agent in the

26

 

London interbank market for such day. In addition, each Lender will pay to the Administrative
Agent, for the account of the Issuing Lender, immediately upon the Issuing Lender’s demand at any
time during the period commencing after such drawing until reimbursement therefor in full by the
Borrower, an amount equal to such Lender’s ratable share of such drawing (in proportion to its
participation therein), together with interest on such amount for each day from the date of the
Issuing Lender’s demand for such payment (or, if such demand is made after 12:00 Noon (New York
City time) on such date, from the next succeeding Domestic Business Day) to the date of payment by
such Lender of such amount at a rate of interest per annum equal to the (i) if such amount is
denominated in Dollars, the Federal Funds Rate and (ii) if such amount is denominated in an
Alternative Currency, the rate per annum at which one-day deposits in the relevant currency are
offered by the principal London office of the Administrative Agent in the London interbank market
for such day. The Issuing Lender will pay to each Lender ratably all amounts received from the
Borrower for application in payment of its reimbursement obligations in respect of any Letter of
Credit, but only to the extent such Lender has made payment to the Issuing Lender in respect of
such Letter of Credit pursuant hereto.

     (e) The obligations of the Borrower and each Lender under subsection 2.19(d) above shall be
absolute, unconditional and irrevocable, and shall be performed strictly in accordance with the
terms of this Agreement, under all circumstances whatsoever, including without limitation the
following circumstances:

     (i) any lack of validity or enforceability of this Agreement or any Letter of Credit
or any document related hereto or thereto;

     (ii) any amendment or waiver of or any consent to departure from all or any of the
provisions of this Agreement or any Letter of Credit or any document related hereto or
thereto, provided by any party affected thereby;

     (iii) the use which may be made of the Letter of Credit by, or any acts or omission
of, a beneficiary of a Letter of Credit (or any Person for whom the beneficiary may be
acting);

     (iv) the existence of any claim, set-off, defense or other rights that the Borrower
may have at any time against a beneficiary of a Letter of Credit (or any Person for whom
the beneficiary may be acting), the Lenders (including the Issuing Lender) or any other
Person, whether in connection with this Agreement or the Letter of Credit or any document
related hereto or thereto or any unrelated transaction;

27

 

     (v) any statement or any other document presented under a Letter of Credit proving to
be forged, fraudulent or invalid in any respect or any statement therein being untrue or
inaccurate in any respect whatsoever;

     (vi) payment under a Letter of Credit to the beneficiary of such Letter of Credit
against presentation to the Issuing Lender of a draft or certificate that does not comply
with the terms of the Letter of Credit;

     (vii) any termination of the Commitments prior to, on or after the Payment Date for
any Letter of Credit, whether at the scheduled termination thereof, by operation of
Article 6 or otherwise; or

     (viii) any other act or omission to act or delay of any kind by any Lender (including
the Issuing Lender), the Administrative Agent or any other Person or any other event or
circumstance whatsoever that might, but for the provisions of this subsection (viii),
constitute a legal or equitable discharge of the Borrower’s or the Lender’s obligations
hereunder.

     (f) The Borrower hereby indemnifies and holds harmless each Lender (including the Issuing
Lender) and the Administrative Agent from and against any and all claims, damages, losses,
liabilities, costs or expenses which such Lender or the Administrative Agent may incur (including,
without limitation, any claims, damages, losses, liabilities, costs or expenses which the Issuing
Lender may incur by reason of or in connection with the failure of any other Lender to fulfill or
comply with its obligations to such Issuing Lender hereunder (but nothing herein contained shall
affect any rights the Borrower may have against such defaulting Lender)), and none of the Lenders
(including the Issuing Lender) nor the Administrative Agent nor any of their officers or directors
or employees or agents shall be liable or responsible, by reason of or in connection with the
execution and delivery or transfer of or payment or failure to pay under any Letter of Credit,
including without limitation any of the circumstances enumerated in subsection 2.19(e) above, as
well as (i) any error, omission, interruption or delay in transmission or delivery of any messages,
by mail, cable, telegraph, telex or otherwise, (ii) any loss or delay in the transmission of any
document required in order to make a drawing under a Letter of Credit, and (iii) any consequences
arising from causes beyond the control of the Issuing Lender, including without limitation any
government acts, or any other circumstances whatsoever in making or failing to make payment under
such Letter of Credit; provided that the Borrower shall not be required to indemnify the Issuing
Lender for any claims, damages, losses, liabilities, costs or expenses, and the Borrower shall have
a claim for direct (but not consequential) damage suffered by it, to the extent found by a court of
competent jurisdiction to have been caused by (x) the willful misconduct or gross negligence of the
Issuing Lender in determining whether a request

28

 

presented under any Letter of Credit complied with the terms of such Letter of Credit or (y)
the Issuing Lender’s failure to pay under any Letter of Credit after the presentation to it of a
request strictly complying with the terms and conditions of the Letter of Credit. Nothing in this
subsection 2.19(f) is intended to limit the obligations of the Borrower under any other provision
of this Agreement. To the extent the Borrower does not indemnify the Issuing Lender as required by
this subsection, the Lenders agree to do so ratably in accordance with their Commitments.

     (g) If the Required Lenders reasonably determine at any time that the conditions set forth in
Section 3.02 would not be satisfied in respect of a Borrowing at such time, then the Required
Lenders may request that the Administrative Agent issue a “Stop Issuance Notice”, and the
Administrative Agent shall issue such notice to each Issuing Lender. Such Stop Issuance Notice
shall be withdrawn upon a determination by the Required Lenders that the circumstances giving rise
thereto no longer exist. No Letter of Credit shall be issued while a Stop Issuance Notice is in
effect. The Required Lenders may request issuance of a Stop Issuance Notice only if there is a
reasonable basis therefor, and shall consider reasonably and in good faith a request from the
Company for withdrawal of the same on the basis that the conditions in Section 3.02 are satisfied;
provided that the Administrative Agent and the Issuing Lenders may and shall conclusively rely upon
any Stop Issuance Notice while it remains in effect.

     Section 2.20. Increased Commitments, Additional Lenders. (a) From time to time the Company
may, upon at least five days’ notice to the Administrative Agent (which shall promptly provide a
copy of such notice to the Lenders), increase the aggregate amount of the Commitments by an amount
not less than $10,000,000 (the amount of any such increase, the “Increased Commitments”).

     (b) To effect such an increase, the Company may designate one or more of the existing Lenders
or other financial institutions acceptable to the Administrative Agent and each Issuing Lender
which at the time agree to (i) in the case of any such Person that is an existing Lender, increase
its Commitment and (ii) in the case of any other such Person (an “Additional Lender”), become a
party to this Agreement with a Commitment of not less than $10,000,000.

     (c) Any increase in the Commitments pursuant to this Section 2.20 shall be subject to
satisfaction of the following conditions:

     (i) before and after giving effect to such increase, all representations and
warranties contained in Article 4 shall be true;

     (ii) at the time of such increase, no Default shall have occurred and be continuing
or would result from such increase; and

29

 

     (iii) after giving effect to such increase, the aggregate amount of all increases in
Commitments made pursuant to this Section 2.20 shall not exceed $400,000,000.

     (d) An increase in the aggregate amount of the Commitments pursuant to this Section 2.20 shall
become effective upon the receipt by the Administrative Agent of (i) an agreement in form and
substance satisfactory to the Administrative Agent signed by the Company, by each Additional Lender
and by each other Lender whose Commitment is to be increased, setting forth the new Commitments of
such Lenders and setting forth the agreement of each Additional Lender to become a party to this
Agreement and to be bound by all the terms and provisions hereof, (ii) such evidence of appropriate
corporate authorization on the part of the Company with respect to the Increased Commitments and
such opinions of counsel for the Company with respect to the Increased Commitments as the
Administrative Agent may reasonably request and (iii) such evidence of the satisfaction of the
conditions set forth in subsection (c) above as the Administrative Agent may reasonably request.

     (e) Upon any increase in the aggregate amount of the Commitments pursuant to this Section
2.20, (i) the respective Letter of Credit Liabilities of the Lenders shall be redetermined as of
the effective date of such increase in proportion to their respective Commitments after giving
effect to such increase and (ii) within five Domestic Business Days, in the case of Base Rate Loans
then outstanding, and at the end of the then current Interest Period with respect thereto, in the
case of Euro-Currency Loans then outstanding, the Borrower shall prepay or repay such Loans in
their entirety and, to the extent the Borrower elects to do so and subject to the conditions
specified in Article 3, the Borrower shall reborrow Loans from the Lenders in proportion to their
respective Commitments after giving effect to such increase, until such time as all outstanding
Loans are held by the Lenders in such proportion.

ARTICLE 3

Conditions

     Section 3.01. Effectiveness. This Agreement shall become effective on the date that each of
the following conditions shall have been satisfied (or waived in accordance with Section 11.05):

     (a) receipt by the Administrative Agent of counterparts hereof signed by each of the parties
hereto (or, in the case of any party as to which an executed counterpart shall not have been
received, receipt by the Administrative Agent in form satisfactory to it of telegraphic or other
written confirmation from such party of execution of a counterpart hereof by such party);

30

 

     (b) receipt by the Administrative Agent of an opinion of Jerome D. Okarma, general counsel for
the Company, substantially in the form of Exhibit B hereto and covering such additional matters
relating to the transactions contemplated hereby as the Required Lenders may reasonably request;

     (c) receipt by the Administrative Agent of an opinion of Davis Polk & Wardwell, special
counsel for the Administrative Agent, substantially in the form of Exhibit C hereto and covering
such additional matters relating to the transactions contemplated hereby as the Required Lenders
may reasonably request;

     (d) receipt by the Administrative Agent of all documents the Administrative Agent may
reasonably request relating to the existence of the Company, the corporate authority for and the
validity of this Agreement and the Notes, and any other matters relevant hereto, all in form and
substance satisfactory to the Administrative Agent; and

     (e) arrangements satisfactory to the Administrative Agent shall have been made for the payment
of all principal of any loans outstanding under, and all accrued interest and fees under, the
Existing Credit Agreements;

provided that this Agreement shall not become effective or be binding on any party hereto unless
all of the foregoing conditions are satisfied not later than October 6, 2005. The Administrative
Agent shall promptly notify the Company, each Lender and each other party to the Existing Credit
Agreements of the Effective Date, and such notice shall be conclusive and binding on all parties.
The Company and each Lender party to any of the Existing Credit Agreements, comprising the
“Required Banks” as defined in each of the existing Credit Agreements, hereby agree that (i) the
commitments of the banks under each Existing Credit Agreement shall terminate in their entirety
immediately and automatically upon the effectiveness of this Agreement, without further action by
any party to either Existing Credit Agreement, (ii) all accrued facility fees under each Existing
Credit Agreement shall be due and payable at such time and (iii) subject to Section 2.13 of each
Existing Credit Agreement, the Borrowers may prepay any and all loans outstanding thereunder on the
Effective Date.

     Section 3.02. Borrowings and Issuances of Letters of Credit. The obligation of any Lender
to make a Loan on the occasion of any Borrowing and the obligation of the Issuing Lender to issue
(or amend, renew or extend the term of) any Letter of Credit is subject to the satisfaction of the
following conditions:

     (a) receipt by the Administrative Agent of a Notice of Borrowing as required by Section 2.02
or receipt by the Issuing Lender of a Notice of Issuance as required by Section 2.19(b), as the
case may be;

31

 

     (b) the fact that, immediately after such Borrowing or issuance of such Letter of Credit (i)
the Total Outstanding Amount will not exceed the aggregate amount of the Commitments and (ii) the
aggregate Dollar Amount of all Letter of Credit Liabilities will not exceed $200,000,000;

     (c) the fact that, immediately before and after such Borrowing or issuance of such Letter of
Credit, no Default shall have occurred and be continuing; and

     (d) the fact that the representations and warranties of the Company and, if other than the
Company, the Borrower contained in this Agreement (except the representations and warranties set
forth in Sections 4.04(c), 4.05 and 4.07, in each case as to any matter which has theretofore been
disclosed in writing by the Company to the Lenders) shall be true on and as of the date of such
Borrowing or issuance.

Each Borrowing and issuance of a Letter of Credit hereunder shall be deemed to be a representation
and warranty by the Borrower (and by the Company if it is not the Borrower) on the date of such
Borrowing as to the facts specified in clauses 3.02(b), 3.02(c) and 3.02(d).

     Section 3.03. First Borrowing by Each Eligible Subsidiary.

     (a) The obligation of each Lender to make a Loan, and the obligation of an Issuing Lender to
issue a Letter of Credit, on the occasion of the first Borrowing by or issuance of a Letter of
Credit for the account of each Eligible Subsidiary is subject to the receipt by the Administrative
Agent of the following documents:

     (i) an opinion of counsel for such Eligible Subsidiary acceptable to the
Administrative Agent, which may be in-house counsel unless the Administrative Agent
otherwise reasonably determines, substantially in the form of Exhibit F hereto and
covering such additional matters relating to the transactions contemplated hereby as the
Required Lenders may reasonably request; and

     (ii) all documents which it may reasonably request relating to the existence of such
Eligible Subsidiary, the corporate authority for and the validity of the Election to
Participate of such Eligible Subsidiary, this Agreement and the Notes of such Eligible
Subsidiary, and any other matters relevant thereto, all in form and substance satisfactory
to the Administrative Agent.

     (b) Following the giving of any Election to Participate, if the designation of such Eligible
Subsidiary obligates the Administrative Agent or any

32

 

Lender to comply with “know your customer” or similar identification procedures in
circumstances where the necessary information is not already available to it, the Company shall,
promptly upon the request of the Administrative Agent or any Lender, supply such documentation and
other evidence as is reasonably requested by the Administrative Agent or any Lender in order for
the Administrative Agent or such Lender to carry out and be satisfied it has complied with all
necessary “know your customer’ or other similar checks under all applicable laws and regulations.

ARTICLE 4

Representations and Warranties of the Company

     The Company represents and warrants that:

     Section 4.01. Corporate Existence and Power. The Company is a corporation duly
incorporated, validly existing and in good standing under the laws of Wisconsin, and has all
corporate powers and all material governmental licenses, authorizations, consents and approvals
required to carry on its business as now conducted.

     Section 4.02.
Corporate and Governmental Authorization; No Contravention. The execution,
delivery and performance by the Company of this Agreement and its Notes are within the Company’s
corporate powers, have been duly authorized by all necessary corporate action, require no action by
or in respect of, or filing with, any governmental body, agency or official and do not contravene,
or constitute a default under, any provision of applicable law or regulation or of the certificate
of incorporation or by-laws of the Company or of any agreement, judgment, injunction, order, decree
or other instrument binding upon the Company or result in the creation or imposition of any Lien on
any asset of the Company or any of its Consolidated Subsidiaries.

     Section 4.03. Binding Effect. This Agreement constitutes a valid and binding agreement of
the Company, and its Notes, if and when executed and delivered in accordance with this Agreement,
will constitute valid and binding obligations of the Company.

     Section 4.04. Financial Information.

     (a) The consolidated statement of financial position of the Company and its Consolidated
Subsidiaries as of September 30, 2004 and the related consolidated statements of income, cash flows
and shareholders’ equity for the fiscal year then ended, reported on by PricewaterhouseCoopers LLP
and set forth in the Company’s 2004 Form 10-K, a copy of which has been delivered to each of the
Lenders, fairly present, in conformity with generally accepted accounting

33

 

principles, the consolidated financial position of the Company and its Consolidated
Subsidiaries as of such date and their consolidated results of operations and cash flows for such
fiscal year.

     (b) The unaudited consolidated statement of financial position of the Company and its
Consolidated Subsidiaries as of June 30, 2005 and the related unaudited consolidated statements of
income, cash flows and shareholders’ equity for the nine months then ended, set forth in the
Company’s quarterly report for the fiscal quarter ended June 30, 2005 as filed with the Securities
and Exchange Commission on Form 10-Q, a copy of which has been delivered to each of the Lenders,
fairly present, in conformity with generally accepted accounting principles applied on a basis
consistent with the financial statements referred to in subsection (a) of this Section 4.04, the
consolidated financial position of the Company and its Consolidated Subsidiaries as of such date
and their consolidated results of operations and cash flows for such nine month period (subject to
normal year-end adjustments).

     (c) Since September 30, 2004 there has been no material adverse change in the business,
financial position, results of operations or prospects of the Company and its Consolidated
Subsidiaries, considered as a whole.

     Section 4.05. Litigation. Except as set forth in the Company’s reports on Form 8-K, Form
10-K and Form 10-Q filed with the Securities and Exchange Commission pursuant to the Securities
Exchange Act of 1934, copies of which have been provided to the Lenders, there is no action, suit
or proceeding pending against, or to the knowledge of the Company threatened against or affecting,
the Company or any of its Consolidated Subsidiaries before any court or arbitrator or any
governmental body, agency or official in which there is a reasonable possibility of an adverse
decision which could materially adversely affect the business, consolidated financial position or
consolidated results of operations of the Company and its Consolidated Subsidiaries, considered as
a whole, or which in any manner draws into question the validity of this Agreement or the Notes.

     Section 4.06. Compliance with ERISA. Each member of the ERISA Group has fulfilled its
obligations under the minimum funding standards of ERISA and the Internal Revenue Code with respect
to each Plan and is in compliance in all material respects with the presently applicable provisions
of ERISA and the Internal Revenue Code with respect to each Plan. No member of the ERISA Group has
(i) sought a waiver of the minimum funding standard under Section 412 of the Internal Revenue Code
in respect of any Plan, (ii) failed to make any contribution or payment to any Plan or
Multiemployer Plan or in respect of any Benefit Arrangement, or made any amendment to any Plan or
Benefit Arrangement, which has resulted or could result in the imposition of a Lien or the posting
of a bond or other security under ERISA or the Internal

34

 

Revenue Code or (iii) incurred any liability under Title IV of ERISA other than a liability to
the PBGC for premiums under Section 4007 of ERISA.

     Section 4.07. Environmental Matters. In the course of its business, the Company reviews the
effect of Environmental Laws on the business, operations and properties of the Company and its
Subsidiaries, in the course of which it attempts to identify and evaluate associated liabilities
and costs (“Environmental Liabilities”) (including, without limitation, any capital or operating
expenditures required for clean-up or closure of properties presently owned, any capital or
operating expenditures required to achieve or maintain compliance with environmental protection
standards imposed by law or as a condition of any license, permit or contract, any related
constraints on operating activities, including any periodic or permanent shutdown of any facility
or reduction in the level of or change in the nature of operations conducted thereat and any actual
or potential liabilities to third parties, including employees, and any related costs and
expenses). Except as set forth in Schedule I hereto, on the basis of this review, the Company has
reasonably concluded that its Environmental Liabilities are unlikely to have a material adverse
effect on the business, financial condition, results of operations or prospects of the Company and
its Consolidated Subsidiaries, considered as a whole.

     Section 4.08. Taxes. United States Federal income tax returns of the Company and its
Consolidated Subsidiaries have been examined and closed through the fiscal year ended September 30,
2001. The Company and its Consolidated Subsidiaries have filed all United States Federal income
tax returns and all other material tax returns which are required to be filed by them and have paid
all taxes due pursuant to such returns or pursuant to any assessment received by the Company or any
Consolidated Subsidiary. The charges, accruals and reserves on the books of the Company and its
Consolidated Subsidiaries in respect of taxes or other governmental charges are, in the opinion of
the Company, adequate.

     Section 4.09. Subsidiaries. Each of the Company’s corporate Consolidated Subsidiaries is a
corporation duly incorporated, validly existing and in good standing under the laws of its
jurisdiction of incorporation, and has all corporate powers and all material governmental licenses,
authorizations, consents and approvals required to carry on its business as now conducted, except
those instances where failure to hold such powers, licenses, authorizations, consents or approvals
would not be expected to have a material adverse effect on the Company.

     Section 4.10. Not an Investment Company. The Company is not an “investment company” within
the meaning of the Investment Company Act of 1940, as amended.

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     Section 4.11. Full Disclosure. All information heretofore furnished in writing by the
Company to the Administrative Agent or any Lender for purposes of or in connection with this
Agreement or any transaction contemplated hereby is, and all such information hereafter furnished
in writing by the Company to the Administrative Agent or any Lender will be, true and accurate in
all material respects on the date as of which such information is stated or certified. The Company
has disclosed to the Lenders in writing any and all facts which materially and adversely affect the
business, operations or financial condition of the Company and its Consolidated Subsidiaries, taken
as a whole, or the ability of the Company to perform its obligations under this Agreement.

ARTICLE 5

Covenants

     The Company agrees that, so long as any Lender has any Commitment hereunder or any principal,
interest or fees payable hereunder remain unpaid:

     Section 5.01. Information. The Company will deliver to each of the Lenders:

     (a) as soon as available and in any event within 95 days after the end of each fiscal year of
the Company, a consolidated statement of financial position of the Company and its Consolidated
Subsidiaries as of the end of such fiscal year and the related consolidated statements of income,
cash flow and shareholders’ equity for such fiscal year, setting forth in each case in comparative
form the figures for the previous fiscal year, all set forth in accordance with generally accepted
accounting principles and reported on in a manner acceptable to the Securities and Exchange
Commission by PricewaterhouseCoopers LLP or other independent public accountants of nationally
recognized standing;

     (b) as soon as available and in any event within 50 days after the end of each of the first
three quarters of each fiscal year of the Company, a consolidated statement of financial position
of the Company and its Consolidated Subsidiaries as of the end of such quarter and the related
consolidated statements of income, cash flow and shareholders’ equity for such quarter and for the
portion of the Company’s fiscal year ended at the end of such quarter, setting forth in each case
in comparative form the figures for the corresponding quarter and the corresponding portion of the
Company’s previous fiscal year, all certified (subject to normal year-end adjustments) as to
fairness of presentation, generally accepted accounting principles and consistency by the chief
financial officer or the chief accounting officer of the Company;

     (c) simultaneously with the delivery of each set of financial statements referred to in
clauses (a) and (b) above, a certificate of the chief financial officer

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or the chief accounting officer of the Company (i) stating whether any Default exists on the
date of such certificate and, if any Default then exists, setting forth the details thereof and the
action which the Company is taking or proposes to take with respect thereto and (ii) setting forth
in reasonable detail the calculations required to establish whether the Company was in compliance
with the requirements of Sections 5.07 to 5.08, inclusive, on the date of such financial
statements;

     (d) as soon as practicable under the circumstances, after any officer of the Company obtains
knowledge of any Default, if such Default is then continuing, a certificate of the chief financial
officer or the chief accounting officer of the Company setting forth the details thereof and the
action which the Company is taking or proposes to take with respect thereto;

     (e) promptly upon the mailing thereof to the shareholders of the Company generally, copies of
all financial statements, reports and proxy statements so mailed;

     (f) promptly upon the filing thereof, copies of all registration statements (other than the
exhibits thereto and any registration statements on Form S-8 or its equivalent) and reports on
Forms 10-K, 10-Q and 8-K (or their equivalents) which the Company shall have filed with the
Securities and Exchange Commission;

     (g) if and when any member of the ERISA Group (i) gives or is required to give notice to the
PBGC of any “reportable event” (as defined in Section 4043 of ERISA) with respect to any Plan which
might constitute grounds for a termination of such Plan under Title IV of ERISA, or knows that the
plan administrator of any Plan has given or is required to give notice of any such reportable
event, a copy of the notice of such reportable event given or required to be given to the PBGC;
(ii) receives notice of complete or partial withdrawal liability under Title IV of ERISA or notice
that any Multiemployer Plan is in reorganization, is insolvent or has been terminated, a copy of
such notice; (iii) receives notice from the PBGC under Title IV of ERISA of an intent to terminate,
impose liability (other than for premiums under Section 4007 of ERISA) in respect of, or appoint a
trustee to administer any Plan, a copy of such notice; (iv) applies for a waiver of the minimum
funding standard under Section 412 of the Internal Revenue Code, a copy of such application; (v)
gives notice of intent to terminate any Plan under Section 4041(c) of ERISA, a copy of such notice
and other information filed with the PBGC; (vi) gives notice of withdrawal from any Plan pursuant
to Section 4063 of ERISA, a copy of such notice; or (vii) fails to make any payment or contribution
to any Plan or Multiemployer Plan or in respect of any Benefit Arrangement or makes any amendment
to any Plan or Benefit Arrangement which has resulted or could result in the imposition of a Lien
or the posting of a bond or other security, a certificate of the chief financial officer or the
chief accounting officer of the Company setting forth details as to

37

 

such occurrence and action, if any, which the Company or applicable member of the ERISA Group
is required or proposes to take; and

     (h) from time to time such additional information regarding the financial position or business
of the Company and its Consolidated Subsidiaries as the Administrative Agent, at the request of any
Lender, may reasonably request.

     Information required to be delivered pursuant to subsections (a), (b), (e) or (f) above shall
be deemed to have been delivered on the date on which the Company provides notice to the Lenders
that such information has been posted on the Company’s website on the Internet at the website
address www.jci.com, at sec.gov/edaux/searches.htm or at another website identified in such notice
and accessible by the Lenders without charge; provided that (i) such notice may be included in a
certificate delivered pursuant to subsection 5.01(c) and (ii) the Company shall deliver paper
copies of the information referred to in subsections (a), (b), (e) or (f) to any Lender which
requests such delivery.

     Section 5.02. Payment of Obligations. Each Borrower will pay and discharge, and will cause
each of its Consolidated Subsidiaries to pay and discharge, at or before maturity, all their
respective material obligations and liabilities including, without limitation, tax liabilities,
except where the same may be contested in good faith by appropriate proceedings, and will maintain,
and will cause each of its Consolidated Subsidiaries to maintain, in accordance with generally
accepted accounting principles, appropriate reserves for the accrual of any of the same.

     Section 5.03. Maintenance of Property; Insurance.

     (a) Each Borrower will, to the best of its ability, keep, and will cause each of its
Consolidated Subsidiaries to keep, all material property useful and necessary in its business in
good working order and condition, ordinary wear and tear excepted.

     (b) Each Borrower will, and will cause each of its Consolidated Subsidiaries to, maintain
(either in the name of such Borrower or in such Consolidated Subsidiary’s own name) with
financially sound and responsible insurance companies, insurance on all their respective properties
in at least such amounts, and with such reasonable amounts of self-insurance, and against at least
such risks (and with such risk retention) as are usually insured against in the same general area
by companies of established repute engaged in the same or a similar business; and will furnish to
the Lenders, upon request from the Administrative Agent, information presented in reasonable detail
as to the insurance so carried.

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     Section 5.04. Conduct of Business and Maintenance of Existence. Each Borrower will
preserve, renew and keep in full force and effect, and will cause each of its Consolidated
Subsidiaries to preserve, renew and keep in full force and effect their respective corporate
existence and their respective rights, privileges and franchises necessary or desirable in the
normal conduct of business; provided that nothing in this Section 5.04 shall prohibit (i) the
merger of a Consolidated Subsidiary into the Company or the merger or consolidation of a
Consolidated Subsidiary with or into another Person if the corporation surviving such consolidation
or merger is a Consolidated Subsidiary and if, in each case, after giving effect thereto, no
Default shall have occurred and be continuing or (ii) the termination of the corporate existence of
any Consolidated Subsidiary if the Company in good faith determines that such termination (x) is in
the best interest of the Company and (y) is not materially disadvantageous to the Lenders.

     Section 5.05. Compliance with Laws. Each Borrower will comply, and cause each of its
Consolidated Subsidiaries to comply, in all material respects with all applicable laws, ordinances,
rules, regulations, and requirements of governmental authorities (including, without limitation,
Environmental Laws and ERISA and the rules and regulations thereunder) except where the necessity
of compliance therewith is contested in good faith by appropriate proceedings.

     Section 5.06. Inspection of Property, Books and Records. Each Borrower will keep, and will
cause each of its Consolidated Subsidiaries to keep, proper books of record and account in which
full, true and correct entries shall be made of all dealings and transactions in relation to its
business and activities; and will permit, and will cause each of its Consolidated Subsidiaries to
permit, representatives of any Lender at such Lender’s expense to visit and inspect any of their
respective properties, to examine any of their respective books and records and to discuss their
respective affairs, finances and accounts with their respective officers and independent public
accountants in the presence of such officers, all at such reasonable times and as often as may
reasonably be desired.

     Section 5.07. Minimum Consolidated Stockholder’s Equity. Consolidated Stockholders’ Equity
will at no time be less than $1,310,000,000.

     Section 5.08. Negative Pledge. Neither the Company nor any Consolidated Subsidiary will
create, assume or suffer to exist any Lien on any asset now owned or hereafter acquired by it,
except:

     (a) Liens existing on the date of this Agreement securing Debt outstanding on the date of this
Agreement in an aggregate principal amount not exceeding $100,000,000;

39

 

     (b) any Lien existing on any asset of any corporation at the time such corporation becomes a
Consolidated Subsidiary and not created in contemplation of such event;

     (c) any Lien on any asset securing Debt incurred or assumed for the purpose of financing an
amount not to exceed all or any part of the cost of acquiring such asset, provided that such Lien
attaches to such asset concurrently with or within 90 days after the acquisition thereof;

     (d) any Lien on any asset of any corporation existing at the time such corporation is merged
or consolidated with or into the Company or a Consolidated Subsidiary and not created in
contemplation of such event;

     (e) any Lien existing on any asset prior to the acquisition thereof by the Company or a
Consolidated Subsidiary and not created in contemplation of such acquisition;

     (f) any Lien arising out of the refinancing, extension, renewal or refunding of any Debt
secured by any Lien permitted by any of the foregoing clauses of this Section 5.08, provided that
such Debt is not increased and is not secured by any additional assets;

     (g) Liens arising in the ordinary course of its business which (i) do not secure Debt or any
obligations of the type referred to in the proviso to the definition of Debt, (ii) do not secure
any obligation in an amount exceeding $75,000,000 and (iii) do not in the aggregate materially
detract from the value of its assets or materially impair the use thereof in the operation of its
business; and

     (h) Liens not otherwise permitted by the foregoing clauses of this Section 5.08 securing Debt
in an aggregate principal amount at any time outstanding not to exceed 10% of Consolidated
Stockholders’ Equity.

     Section 5.09. Consolidation, Mergers and Sales of Assets. Neither the Company nor any
Consolidated Subsidiary will (i) consolidate or merge with or into any other Person or (ii) sell,
lease or otherwise transfer, directly or indirectly, all or any substantial part of the assets of
the Company and its Consolidated Subsidiaries, taken as a whole, to any other Person; provided that
(A) the Company and any Consolidated Subsidiary may merge with another Person (other than a merger
of a Consolidated Subsidiary with the Company) if the Company or such Consolidated Subsidiary is
the corporation surviving such merger and if, immediately after giving effect to such merger, no
Default shall have occurred and be continuing, (B) the Company and any Consolidated Subsidiary may
merge with each other if immediately after giving effect to such merger, no Default shall have
occurred and be continuing; provided that, if the Company is not the Person surviving such merger,
such Person (1) is a corporation organized under the laws

40

 

of any State of the United States of America and (2) shall have assumed all obligations of the
Company under this Agreement and any Note pursuant to an instrument satisfactory in form and
substance to the Administrative Agent, and (C) any Consolidated Subsidiary may merge with or into
any other Consolidated Subsidiary, so long as a Consolidated Subsidiary is the Person surviving
such merger.

     Section 5.10. Use of Proceeds. The proceeds of the Loans made under this Agreement will be
used by the Borrowers for general corporate purposes. None of such proceeds will be used, directly
or indirectly, for the purpose, whether immediate, incidental or ultimate, of buying or carrying
any “margin stock” within the meaning of Regulation U.

ARTICLE 6

Defaults

     Section 6.01. Events of Default. If one or more of the following events (“Events of
Default”) shall have occurred and be continuing:

     (a) any principal of any Loan or any Reimbursement Obligation shall not be paid when due, or
any interest, any fees or any other amount payable hereunder, shall not be paid within five days of
the due date therefor;

     (b) the Company shall fail to observe or perform any covenant contained in Sections 5.07 to
5.10, inclusive;

     (c) any Borrower shall fail to observe or perform any covenant or agreement contained in this
Agreement (other than those covered by clause (a) or (b) above) for 30 days after written notice
thereof has been given to the Company by the Administrative Agent at the request of any Lender;

     (d) the guaranty provided by the Company under Section 10.01 of this Agreement shall cease to
be in full force and effect;

     (e) any representation, warranty, certification or statement made by any Borrower in this
Agreement or in any certificate, financial statement or other document delivered pursuant to this
Agreement shall prove to have been incorrect in any material respect when made (or deemed made);

     (f) the Company or any Consolidated Subsidiary shall fail to make any payment in respect of
any Material Debt when due or within any applicable grace period;

41

 

     (g) any event or condition shall occur which results in the acceleration of the maturity of
any Material Debt or enables (or, with the giving of notice or lapse of time or both, would enable)
the holder of such Debt or any Person acting on such holder’s behalf to accelerate the maturity
thereof;

     (h) the Company or any Consolidated Subsidiary shall commence a voluntary case or other
proceeding seeking liquidation, reorganization or other relief with respect to itself or its debts
under any bankruptcy, insolvency or other similar law now or hereafter in effect or seeking the
appointment of a trustee, receiver, liquidator, custodian or other similar official of it or any
substantial part of its property, or shall consent to any such relief or to the appointment of or
taking possession by any such official in an involuntary case or other proceeding commenced against
it, or shall make a general assignment for the benefit of creditors, or shall fail generally to pay
its debts as they become due, or shall take any corporate action to authorize any of the foregoing;

     (i) an involuntary case or other proceeding shall be commenced against the Company or any
Consolidated Subsidiary seeking liquidation, reorganization or other relief with respect to it or
its debts under any bankruptcy, insolvency or other similar law now or hereafter in effect or
seeking the appointment of a trustee, receiver, liquidator, custodian or other similar official of
it or any substantial part of its property, and such involuntary case or other proceeding shall
remain undismissed and unstayed for a period of 60 days; or an order for relief shall be entered
against the Company or any Consolidated Subsidiary under the federal bankruptcy laws as now or
hereafter in effect;

     (j) any member of the ERISA Group shall fail to pay when due an amount or amounts aggregating
in excess of $75,000,000 which it shall have become liable to pay under Title IV of ERISA; or
notice of intent to terminate a Material Plan shall be filed under Title IV of ERISA by any member
of the ERISA Group, any plan administrator or any combination of the foregoing; or the PBGC shall
institute proceedings under Title IV of ERISA to terminate, to impose liability (other than for
premiums under Section 4007 of ERISA) in respect of, or to cause a trustee to be appointed to
administer any Material Plan; or a condition shall exist by reason of which the PBGC would be
entitled to obtain a decree adjudicating that any Material Plan must be terminated; or there shall
occur a complete or partial withdrawal from, or a default, within the meaning of Section 4219(c)(5)
of ERISA, with respect to, one or more Multiemployer Plans which could cause one or more members of
the ERISA Group to incur a current payment obligation in excess of $75,000,000;

     (k) a judgment or order for the payment of money in excess of $100,000,000 shall be rendered
against the Company or any Consolidated Subsidiary and such judgment or order shall continue
unsatisfied and unstayed for the shorter of (x) a period of 30 days and (y) the period during which
a request or

42

 

proceeding for stay of enforcement of such judgment or order is permitted under the rules of
the relevant jurisdiction; or

     (l) any person or group of persons (within the meaning of Section 13 or 14 of the Securities
Exchange Act of 1934, as amended) shall have acquired beneficial ownership (within the meaning of
Rule 13d-3 promulgated by the Securities and Exchange Commission under said Act) of 20% or more of
the outstanding shares of common stock of the Company; or, during any period of 18 consecutive
calendar months, individuals who were directors of the Company on the first day of such period
shall cease to constitute a majority of the board of directors of the Company;

then, and in every such event, the Administrative Agent shall (i) if requested by Lenders having
more than 50% in aggregate amount of the Commitments, by notice to the Company terminate the
Commitments and they shall thereupon terminate, and (ii) if requested by Lenders holding more than
50% in aggregate principal amount of the Loans, by notice to the Company declare the Loans
(together with accrued interest thereon) to be, and the Loans shall thereupon become, immediately
due and payable without presentment, demand, protest or other notice of any kind, all of which are
hereby waived by each Borrower; provided that in the case of any of the Events of Default specified
in clause 6.01(h) or 6.01(i) above with respect to any Borrower, without any notice to any Borrower
or any other act by the Administrative Agent or the Lenders, the Commitments shall thereupon
terminate and the Loans (together with accrued interest thereon) shall become immediately due and
payable without presentment, demand, protest or other notice of any kind, all of which are hereby
waived by each Borrower.

     Section 6.02. Notice of Default. The Administrative Agent shall give notice to the Company
under Section 6.01(c) promptly upon being requested to do so by any Lender and shall thereupon
notify all the Lenders thereof.

     Section 6.03. Cash Cover. Each Borrower agrees, in addition to the provisions in Section
6.01, that upon the occurrence and during the continuance of any Event of Default, it shall, if
requested by the Administrative Agent upon the instruction of the Required Lenders or any Issuing
Lender having an outstanding Letter of Credit, Cash Collateralize all Letters of Credit outstanding
at such time (or, in the cast of a request by an Issuing Bank, all such Letters of Credit issued by
it), provided that, upon the occurrence of any Event of Default specified in clause (h) or (i)
above with respect to any Borrower, the Borrowers shall Cash Collateralize all outstanding Letters
of Credit forthwith without any notice or demand or any other act by the Administrative Agent, any
Issuing Lender or any Lender.

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ARTICLE 7

The Administrative Agent

     Section 7.01. Appointment and Authorization. Each Lender irrevocably appoints and
authorizes the Administrative Agent to take such action as agent on its behalf and to exercise such
powers under this Agreement and the Notes as are delegated to the Administrative Agent by the terms
hereof or thereof, together with all such powers as are reasonably incidental thereto.

     Section 7.02. Administrative Agent and Affiliates. JPMorgan Chase Bank, N.A. shall have the
same rights and powers under this Agreement as any other Lender and may exercise or refrain from
exercising the same as though it were not the Administrative Agent, and JPMorgan Chase Bank, N.A.
and its affiliates may accept deposits from, lend money to, and generally engage in any kind of
business with any Borrower or any Consolidated Subsidiary or affiliate of any Borrower as if it
were not the Administrative Agent.

     Section 7.03. Action by Administrative Agent. The obligations of the Administrative Agent
hereunder are only those expressly set forth herein. Without limiting the generality of the
foregoing, the Administrative Agent shall not be required to take any action with respect to any
Default, except as expressly provided in Article 6.

     Section 7.04. Consultation with Experts. The Administrative Agent shall not be liable for
any action taken or omitted to be taken by it in good faith in accordance with the advice of legal
counsel (who may be counsel for any Borrower), independent public accountants and other experts
selected by it.

     Section 7.05. Liability of Administrative Agent. Neither the Administrative Agent nor any
of its affiliates nor any of their respective directors, officers, agents or employees shall be
liable for any action taken or not taken by it in connection herewith (i) with the consent or at
the request of the Required Lenders or (ii) in the absence of its own gross negligence or willful
misconduct. Neither the Administrative Agent nor any of its affiliates nor any of their respective
directors, officers, agents or employees shall be responsible for or have any duty to ascertain,
inquire into or verify (i) any statement, warranty or representation made in connection with this
Agreement or any Borrowing or issuance of a Letter of Credit hereunder; (ii) the performance or
observance of any of the covenants or agreements of any Borrower; (iii) the satisfaction of any
condition specified in Article 3 except receipt of items required to be delivered to the
Administrative Agent; or (iv) the validity, effectiveness or genuineness of this Agreement, the
Notes, the Letters of Credit or any other instrument or writing furnished in connection herewith.
The Administrative Agent shall not incur any liability by acting in reliance upon any notice,
consent, certificate, statement, or

44

 

other writing (which may be a bank wire or similar writing) believed by it to be genuine or to
be signed by the proper party or parties.

     Section 7.06. Indemnification. Each Lender shall, ratably in accordance with its
Commitment, indemnify the Administrative Agent and each Issuing Lender, their affiliates and their
respective directors, officers, agents and employees (to the extent not reimbursed by the
Borrowers) against any cost, expense (including counsel fees and disbursements), claim, demand,
action, loss or liability (except such as result from such indemnitees’ gross negligence or willful
misconduct) that such indemnitees may suffer or incur in connection with this Agreement or any
Letter of Credit or any action taken or omitted by such indemnitees hereunder or thereunder.

     Section 7.07. Credit Decision. Each Lender acknowledges that it has, independently and
without reliance upon the Administrative Agent or any other Lender, and based on such documents and
information as it has deemed appropriate, made its own credit analysis and decision to enter into
this Agreement. Each Lender also acknowledges that it will, independently and without reliance
upon the Administrative Agent or any other Lender, and based on such documents and information as
it shall deem appropriate at the time, continue to make its own credit decisions in taking or not
taking any action under this Agreement.

     Section 7.08. Successor Administrative Agent. The Administrative Agent may resign at any
time by giving written notice thereof to the Lenders and the Company. Upon any such resignation,
the Required Lenders shall have the right to appoint a successor Administrative Agent. If no
successor Administrative Agent shall have been so appointed by the Required Lenders, and shall have
accepted such appointment, within 30 days after the retiring Administrative Agent gives notice of
resignation, then the retiring Administrative Agent may, on behalf of the Lenders, appoint a
successor Administrative Agent, which shall be a commercial bank organized or licensed under the
laws of the United States of America or of any State thereof and having a combined capital and
surplus of at least $50,000,000. Upon the acceptance of its appointment as Administrative Agent
hereunder by a successor Administrative Agent, such successor Administrative Agent shall thereupon
succeed to and become vested with all the rights and duties of the retiring Administrative Agent,
and the retiring Administrative Agent shall be discharged from its duties and obligations
hereunder. After any retiring Administrative Agent’s resignation hereunder as Administrative
Agent, the provisions of this Article shall inure to its benefit as to any actions taken or omitted
to be taken by it while it was Administrative Agent.

     Section 7.09. Administrative Agent’s Fee. The Company shall pay to the Administrative Agent
for its own account fees in the amounts and at the times previously agreed upon between the
Borrower and the Administrative Agent.

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     Section 7.10. Co-Syndication Agents. Nothing in this Agreement shall impose any duty or
liability whatsoever on any of the Co-Syndication Agents in such capacity.

ARTICLE 8

Change in Circumstances

     Section 8.01. Basis for Determining Interest Rate Inadequate or Unfair. If on or prior to
the first day of any Interest Period for any Euro-Currency Loan:

     (a) the Administrative Agent determines that adequate and fair means do not exist for
determining the applicable London Interbank Offered Rate for such Interest Period, or

     (b) Lenders having 50% or more of the aggregate amount of the Commitments advise the
Administrative Agent that the London Interbank Offered Rate as determined by the Administrative
Agent will not adequately and fairly reflect the cost to such Lenders of funding their
Euro-Currency Loans for such Interest Period,

the Administrative Agent shall forthwith give notice thereof to the Company and the Lenders,
whereupon, until the Administrative Agent notifies the Company that the circumstances giving rise
to such suspension no longer exist, (i) the obligations of the Lenders to make Euro-Currency Loans
in the relevant currency, or to continue or convert outstanding Loans as or into Euro-Currency
Loans in the relevant currency, shall be suspended and (ii) each outstanding Euro-Currency Loan in
the relevant currency shall be prepaid (or, in the case of a Euro-Dollar Loan, converted into a
Base Rate Loan) on the last day of the then current Interest Period applicable thereto. Unless the
Borrower notifies the Administrative Agent at least one Domestic Business Day before the date of
any Euro-Currency Borrowing for which a Notice of Borrowing has previously been given that it
elects not to borrow on such date, such Borrowing shall instead be made as a Base Rate Borrowing in
an equal Dollar Amount.

     Section 8.02. Illegality. If, on or after the date of this Agreement, the adoption of any
applicable law, rule or regulation, or any change in any applicable law, rule or regulation, or any
change in the interpretation or administration thereof by any governmental authority, central bank
or comparable agency charged with the interpretation or administration thereof, or compliance by
any Lender (or its Euro-Dollar Lending Office) with any request or directive (whether or not having
the force of law) of any such authority, central bank or comparable agency shall make it unlawful
or impossible for any Lender (or its Euro-Dollar Lending Office) to make, maintain or fund its
Euro-Currency Loans to any Borrower in any currency and such Lender shall so notify the
Administrative

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Agent, the Administrative Agent shall forthwith give notice thereof to the other Lenders and
the Company, whereupon until such Lender notifies the Company and the Administrative Agent that the
circumstances giving rise to such suspension no longer exist, the obligation of such Lender to make
Euro-Currency Loans to such Borrower in such currency shall be suspended. Before giving any notice
to the Administrative Agent pursuant to this Section 8.02, such Lender shall designate a different
Euro-Currency Lending Office if such designation will avoid the need for giving such notice and
will not, in the judgment of such Lender, be otherwise disadvantageous to such Lender. If such
notice is given, each affected Euro-Currency Loan of such Lender then outstanding shall be
converted to a Base Rate Loan (in the case of an Alternative Currency Loan, in a principal amount
determined on the basis of the Spot Rate on the date of conversion) either (a) on the last day of
the then current Interest Period applicable to such Euro-Currency Loan if such Lender may lawfully
continue to maintain and fund such Loan as a Euro-Currency Loan to such day or (b) immediately if
such Lender shall determine that it may not lawfully continue to maintain and fund such Loan as a
Euro-Currency Loan to such day.

     Section 8.03. Increased Cost and Reduced Return.

     (a) If on or after the date of this Agreement, the adoption of any applicable law, rule or
regulation, or any change in any applicable law, rule or regulation, or any change in the
interpretation or administration thereof by any governmental authority, central bank or comparable
agency charged with the interpretation or administration thereof, or compliance by any Lender (or
its Applicable Lending Office) with any request or directive (whether or not having the force of
law) of any such authority, central bank or comparable agency, shall impose, modify or deem
applicable any reserve (including, without limitation, any such requirement imposed by the Board of
Governors of the Federal Reserve System, but excluding with respect to any Euro-Currency Loan any
such requirement with respect to which such Lender is entitled to compensation during the relevant
Interest Period under Section 2.14), special deposit, insurance assessment or similar requirement
against assets of, deposits with or for the account of, or credit extended by, such Lender (or its
Applicable Lending Office) or shall impose on any Lender (or its Applicable Lending Office) or on
the London interbank market any other condition affecting its Euro-Currency Loans, its Note(s) or
its obligation to make Euro-Currency Loans or its obligations hereunder in respect of Letters of
Credit and the result of any of the foregoing is to increase the cost to such Lender (or its
Applicable Lending Office) of making or maintaining any Euro-Currency Loan or of issuing or
participating in any Letter of Credit, or to reduce the amount of any sum received or receivable by
such Lender (or its Applicable Lending Office) under this Agreement or under its Note(s) with
respect thereto, by an amount deemed by such Lender to be material, then, within 15 days after
demand by such Lender (with a copy to the

47

 

Administrative Agent), the Company shall pay to such Lender such additional amount or amounts
as will compensate such Lender for such increased cost or reduction.

     (b) If any Lender shall have determined that, after the date of this Agreement, the adoption
of any applicable law, rule or regulation regarding capital adequacy, or any change in any such
law, rule or regulation, or any change in the interpretation or administration thereof by any
governmental authority, central bank or comparable agency charged with the interpretation or
administration thereof, or any request or directive regarding capital adequacy (whether or not
having the force of law) of any such authority, central bank or comparable agency, has or would
have the effect of reducing the rate of return on capital of such Lender (or its Parent) as a
consequence of such Lender’s obligations hereunder to a level below that which such Lender (or its
Parent) could have achieved but for such adoption, change, request or directive (taking into
consideration its policies with respect to capital adequacy) by an amount deemed by such Lender to
be material, then from time to time, within 15 days after demand by such Lender (with a copy to the
Administrative Agent), the Company shall pay to such Lender such additional amount or amounts as
will compensate such Lender (or its Parent) for such reduction.

     (c) Each Lender will promptly notify the Company and the Administrative Agent of any event of
which it has knowledge, occurring after the date hereof, which will entitle such Lender to
compensation pursuant to this Section 8.03 and will designate a different Applicable Lending Office
if such designation will avoid the need for, or reduce the amount of, such compensation and will
not, in the judgment of such Lender, be otherwise disadvantageous to such Lender. A certificate of
any Lender claiming compensation under this Section 8.03 and setting forth the additional amount or
amounts to be paid to it hereunder shall be conclusive in the absence of manifest error. In
determining such amount, such Lender may use any reasonable averaging and attribution methods.

     Section 8.04. Taxes.

     (a) Any and all payments by any Borrower to or for the account of any Lender or the
Administrative Agent hereunder or under any Note shall be made free and clear of and without
deduction for any and all present or future taxes, duties, levies, imposts, deductions, charges or
withholdings, and all liabilities with respect thereto, excluding, in the case of each Lender and
the Administrative Agent, taxes imposed on or measured by its income, and franchise taxes imposed
on it, by the jurisdiction under the laws of which such Lender or the Administrative Agent (as the
case may be) is organized or any political subdivision thereof and, in the case of each Lender,
taxes imposed on or measured by its income, and franchise or similar taxes imposed on it, by the
jurisdiction of

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such Lender’s Applicable Lending Office or any political subdivision thereof (all such
non-excluded taxes, duties, levies, imposts, deductions, charges, withholdings and liabilities
being hereinafter referred to as its “Taxes”, and all such excluded taxes being hereinafter
referred to as its “Domestic Taxes”). If a Borrower shall be required by law to deduct any Taxes
from or in respect of any sum payable hereunder or under any Note to any Lender or the
Administrative Agent, (i) the sum payable shall be increased as necessary so that after making all
required deductions (including deductions applicable to additional sums payable under this Section
8.04) such Lender or the Administrative Agent (as the case may be) receives an amount equal to the
sum it would have received had no such deductions been made, (ii) such Borrower shall make such
deductions, (iii) such Borrower shall pay the full amount deducted to the relevant taxation
authority or other authority in accordance with applicable law and (iv) such Borrower shall furnish
to the Administrative Agent, at its address referred to in Section 11.01, the original or a
certified copy of a receipt evidencing payment thereof.

     (b) In addition, the Company agrees to pay any present or future stamp or documentary taxes
and any other excise or property taxes, or charges or similar levies which arise from any payment
made hereunder or under any Note or from the execution or delivery of, or otherwise with respect
to, this Agreement or any Note (hereinafter referred to as “Other Taxes”).

     (c) The Company agrees to indemnify each Lender and the Administrative Agent for the full
amount of Taxes or Other Taxes (including, without limitation, any Taxes or Other Taxes imposed or
asserted by any jurisdiction on amounts payable under this Section 8.04) paid by such Lender or the
Administrative Agent (as the case may be) and any liability (including penalties, interest and
expenses) arising therefrom or with respect thereto. In addition, the Company agrees to indemnify
the Administrative Agent and each Lender for all Domestic Taxes and any liability (including
penalties, interest and expenses) arising therefrom or with respect thereto, in each case to the
extent that such Domestic Taxes result from any payment or indemnification pursuant to this Section
for (i) Taxes or Other Taxes imposed by any jurisdiction other than the United States or (ii)
Domestic Taxes of the Administrative Agent or such Lender, as the case may be. This
indemnification shall be made within 15 days from the date such Lender or the Administrative Agent
(as the case may be) makes demand therefor.

     (d) At the times indicated herein, each Lender organized under the laws of a jurisdiction
outside the United States shall provide the Company with Internal Revenue Service form W-8BEN or
W-8ECI (in each case accompanied by any statements which may be required under applicable Treasury
regulations), as appropriate, or any successor form prescribed by the Internal Revenue Service,
certifying that such Lender is entitled to receive payments under this Agreement (i) without
deduction or withholding of any United States federal income taxes or

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(ii) subject to a reduced rate of United States federal withholding tax, unless, in each case
of clause (i) and (ii) of this Section 8.04(d), an event (including, without limitation, any change
in treaty, law or regulation) has occurred prior to the date on which any such delivery would
otherwise be required which renders such forms inapplicable or which would prevent the Lender from
duly completing and delivering any such form with respect to it and the Lender advises the Company
and the Administrative Agent that it is not capable of receiving payments without any deduction or
withholding of such taxes. Such forms shall be provided (x) on or prior to the date of the Lender’s
execution and delivery of this Agreement in the case of each Lender listed on the signature pages
hereof, and on or prior to the date on which it becomes a Lender in the case of each other Lender,
and (y) on or before the date that such form expires or becomes obsolete or after the occurrence of
any event requiring a change in the most recent form so delivered by the Lender. If the form
provided by a Lender at the time such Lender first becomes a party to this Agreement indicates a
United States interest withholding tax rate in excess of zero, United States withholding tax at
such rate shall be considered excluded from “Taxes” as defined in Section 8.04(a). In addition, to
the extent that for reasons other than a change of treaty, law or regulation any Lender becomes
subject to an increased rate of United States interest withholding tax while it is a party to this
Agreement, United States withholding tax at such increased rate shall be considered excluded from
“Taxes” as defined in Section 8.04(a).

     (e) For any period with respect to which a Lender has failed to provide the Company with the
appropriate form in accordance with Section 8.04(d) (unless such failure is excused by the terms of
Section 8.04(d)), such Lender shall not be entitled to indemnification under Section 8.04(a) or
8.04(c) with respect to Taxes imposed by the United States; provided, however, that should a
Lender, which is otherwise exempt from or subject to a reduced rate of withholding tax, become
subject to Taxes because of its failure to deliver a form required hereunder, the Company shall
take such steps as such Lender shall reasonably request to assist such Lender to recover such
Taxes.

     (f) If the Company is required to pay additional amounts to or for the account of any Lender
pursuant to this Section 8.04, then such Lender will change the jurisdiction of its Applicable
Lending Office so as to eliminate or reduce any such additional payment which may thereafter accrue
if such change, in the judgment of such Lender in the good faith exercise of its discretion, is not
otherwise disadvantageous to such Lender.

     Section 8.05. Base Rate Loans Substituted for Affected Euro-Currency Loans. If (i) the
obligation of any Lender to make, or to continue or convert outstanding Loans as or to,
Euro-Currency Loans to any Borrower in any currency has been suspended pursuant to Section 8.02 or
(ii) any Lender has demanded compensation under Section 8.03 or 8.04 with respect to its Euro-

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Currency Loans in any currency and the Company shall, by at least five Euro-Dollar Business
Days’ prior notice to such Lender through the Administrative Agent, have elected that the
provisions of this Section shall apply to such Lender, then, unless and until such Lender notifies
the Company that the circumstances giving rise to such suspension or demand for compensation no
longer exist, all Loans which would otherwise be made by such Lender as (or continued as or
converted to) Euro-Currency Loans in such currency to such Borrower shall instead be Base Rate
Loans (in the case of Alternative Currency Loans, in the same Dollar Amount as the Euro-Currency
Loan that such Lender would otherwise have made in the Alternative Currency) on which interest and
principal shall be payable contemporaneously with the related Euro-Currency Loans of the other
Lenders. If such Lender notifies the Company that the circumstances giving rise to such suspension
or demand for compensation no longer exist, the principal amount of each such Base Rate Loan shall
be converted into a Euro-Currency Loan on the first day of the next succeeding Interest Period
applicable to the related Euro-Currency Loans of the other Lenders. If such Loan is converted into
an Alternative Currency Loan, such Lender, the Administrative Agent and the Borrower shall make
such arrangements as shall be required (including increasing or decreasing the amount of such
Alternative Currency Loan) so that such Alternative Currency Loan shall be in the same amount as it
would have been if the provisions of this Section had never applied thereto.

ARTICLE 9

Representations and Warranties of Eligible Subsidiaries

     Each Eligible Subsidiary shall be deemed by the execution and delivery of its Election to
Participate to have represented and warranted as of the date thereof that:

     Section 9.01. Corporate Existence and Power. It is duly organized, validly existing and in
good standing under the laws of its jurisdiction of organization and is and will continue to be a
Wholly-Owned Consolidated Subsidiary of the Company.

     Section 9.02. Corporate and Governmental Authorization; No Contravention. The execution and
delivery by it of its Election to Participate and its Notes, and the performance by it of this
Agreement and its Notes, are within its legal powers, have been duly authorized by all necessary
legal action, require no action by or in respect of, or filing with, any governmental body, agency
or official and do not contravene, or constitute a default under, any provision of applicable law
or regulation or of its organizational documents or of any agreement, judgment, injunction, order,
decree or other instrument binding upon

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the Company or such Eligible Subsidiary or result in the creation or imposition of any Lien on
any asset of the Company or any of its Consolidated Subsidiaries.

     Section 9.03. Binding Effect. This Agreement constitutes a valid and binding agreement of
such Eligible Subsidiary and its Notes, if and when executed and delivered in accordance with this
Agreement, will constitute valid and binding obligations of such Eligible Subsidiary.

     Section 9.04. Taxes. Except as disclosed in such Election to Participate, there is no
income, stamp or other tax of any country, or any taxing authority thereof or therein, imposed by
or in the nature of withholding or otherwise, which is imposed on any payment to be made by such
Eligible Subsidiary pursuant hereto or on its Notes, or is imposed on or by virtue of the
execution, delivery or enforcement of its Election to Participate or of its Notes.

ARTICLE 10

Guaranty

     Section 10.01. The Guaranty. The Company hereby unconditionally guarantees the full and
punctual payment (whether at stated maturity, upon acceleration or otherwise) of the principal of
and interest on each Loan made to and each Reimbursement Obligation incurred by any Eligible
Subsidiary pursuant to this Agreement, and the full and punctual payment of all other amounts
payable by any Eligible Subsidiary under this Agreement. Upon failure by any Eligible Subsidiary
to pay punctually any such amount, the Company shall forthwith on demand pay the amount not so paid
at the place and in the manner specified in this Agreement.

     Section 10.02. Guaranty Unconditional. The obligations of the Company hereunder shall be
unconditional and absolute and, without limiting the generality of the foregoing, shall not be
released, discharged or otherwise affected by:

     (a) any extension, renewal, settlement, compromise, waiver or release in respect of any
obligation of any Eligible Subsidiary under this Agreement or any Note, by operation of law or
otherwise;

     (b) any modification or amendment of or supplement to this Agreement or any Note;

     (c) any release, impairment, non-perfection or invalidity of any direct or indirect security
for any obligation of any Eligible Subsidiary under this Agreement or any Note;

52

 

     (d) any change in the corporate existence, structure or ownership of any Eligible Subsidiary,
or any insolvency, bankruptcy, reorganization or other similar proceeding affecting any Eligible
Subsidiary or its assets or any resulting release or discharge of any obligation of any Eligible
Subsidiary contained in this Agreement or any Note;

     (e) the existence of any claim, set-off or other rights which the Company may have at any time
against any Eligible Subsidiary, the Administrative Agent, any Lender or any other Person, whether
in connection herewith or any unrelated transactions, provided that nothing herein shall prevent
the assertion of any such claim by separate suit or compulsory counterclaim;

     (f) any invalidity or unenforceability relating to or against any Eligible Subsidiary for any
reason of this Agreement or any Note, or any provision of applicable law or regulation purporting
to prohibit the payment by any Eligible Subsidiary of the principal of or interest on any Loan or
any other amount payable by it under this Agreement; or

     (g) any other act or omission to act or delay of any kind by any Eligible Subsidiary, the
Administrative Agent, any Lender or any other Person or any other circumstance whatsoever which
might, but for the provisions of this paragraph, constitute a legal or equitable discharge of or
defense to the Company’s obligations hereunder.

     Section 10.03. Discharge Only Upon Payment In Full; Reinstatement In Certain Circumstances.
The Company’s obligations hereunder shall remain in full force and effect until the Commitments
shall have terminated and the principal of and interest on the Loans, the Reimbursement Obligations
and all other amounts payable by the Company and each Eligible Subsidiary under this Agreement
shall have been paid in full. If at any time any payment of the principal of or interest on any
Loan or any other amount payable by any Eligible Subsidiary under this Agreement is rescinded or
must be otherwise restored or returned upon the insolvency, bankruptcy or reorganization of any
Eligible Subsidiary or otherwise, the Company’s obligations hereunder with respect to such payment
shall be reinstated at such time as though such payment had been due but not made at such time.

     Section 10.04. Waiver by the Company. The Company irrevocably waives acceptance hereof,
presentment, demand, protest and any notice not provided for herein, as well as any requirement
that at any time any action be taken by any Person against any Eligible Subsidiary or any other
Person.

     Section 10.05. Subrogation. The Company irrevocably waives any and all rights to which it
may be entitled, by operation of law or otherwise, upon making any payment hereunder to be
subrogated to the rights of the payee against

53

 

an Eligible Subsidiary with respect to such payment or otherwise to be reimbursed, indemnified
or exonerated by or for the account of an Eligible Subsidiary in respect thereof.

     Section 10.06. Stay of Acceleration. In the event that acceleration of the time for payment
of any amount payable by any Eligible Subsidiary under this Agreement or its Notes is stayed upon
insolvency, bankruptcy or reorganization of such Eligible Subsidiary, all such amounts otherwise
subject to acceleration under the terms of this Agreement shall nonetheless be payable by the
Company hereunder forthwith on demand by the Administrative Agent made at the request of the
Required Lenders.

ARTICLE 11

Miscellaneous

     Section 11.01. Notices. All notices, requests and other communications to any party
hereunder shall be in writing (including bank wire, facsimile transmission or similar writing) and
shall be given to such party: (a) in the case of the Company at its address or facsimile number set
forth below, (b) in the case of the Administrative Agent, at its address or facsimile number set
forth below, (c) in the case of an Eligible Subsidiary, at its address or facsimile number set
forth in its Election to Participate), (d) in the case of any Lender, at its address or facsimile
number set forth in its Administrative Questionnaire or (e) in the case of any party, such other
address or facsimile number as such party may hereafter specify for the purpose by notice to the
Administrative Agent and the Company. Each such notice, request or other communication shall be
effective (i) if given by facsimile, when such facsimile is transmitted to the facsimile number
specified in this Section 11.01 and the appropriate answerback is received, (ii) if given by mail,
72 hours after such communication is deposited in the mails with first class postage prepaid,
addressed as aforesaid or (iii) if given by any other means, when delivered at the address
specified in this Section 11.01; provided that notices to the Administrative Agent or an Issuing
Lender under Article 2 or Article 8 shall not be effective until received.

     Company’s Address:

Johnson Controls, Inc.

Attention: Treasurer

5757 North Green Bay Avenue

Post Office Box 591

Milwaukee, WI 53209

Fax: (414) 524-2443

     Administrative Agent’s Address:

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JPMorgan Chase Bank, N.A.

1111 Fannin, 10th Floor

Houston, Texas 77002

Attention: Sharon P. Craft

Fax: 713-750-2938

Email: sharon.p.craft@jpmchase.com

     Section 11.02. No Waivers. No failure or delay by the Administrative Agent or any Lender in
exercising any right, power or privilege hereunder or under any Note shall operate as a waiver
thereof nor shall any single or partial exercise thereof preclude any other or further exercise
thereof or the exercise of any other right, power or privilege. The rights and remedies herein
provided shall be cumulative and not exclusive of any rights or remedies provided by law.

     Section 11.03. Expenses; Indemnification.

     (a) The Company shall pay (i) all reasonable out-of-pocket expenses of the Administrative
Agent, including fees and disbursements of special counsel for the Administrative Agent, in
connection with the preparation of this Agreement, any waiver or consent hereunder or any amendment
hereof or any Default or alleged Default hereunder and (ii) if an Event of Default occurs, all
out-of-pocket expenses incurred by the Administrative Agent and each Lender, including the fees and
disbursements of outside counsel and the allocated cost of inside counsel, in connection with such
Event of Default and collection, bankruptcy, insolvency and other enforcement proceedings resulting
therefrom.

     (b) The Company agrees to indemnify the Administrative Agent and each Lender, their respective
affiliates and the respective directors, officers, agents and employees of the foregoing (each an
“Indemnitee”) and hold each Indemnitee harmless from and against any and all liabilities, losses,
damages, costs and expenses of any kind, including, without limitation, the reasonable fees and
disbursements of counsel, which may be incurred by such Indemnitee in connection with any
investigative, administrative or judicial proceeding (whether or not such Indemnitee shall be
designated a party thereto) brought or threatened relating to or arising out of this Agreement or
any actual or proposed use of proceeds of Loans hereunder; provided that no Indemnitee shall have
the right to be indemnified hereunder for such Indemnitee’s own gross negligence or willful
misconduct or violation by such Indemnitee of any statute or regulation (provided that such
violation was not the result of any breach of statute or regulation or of any provision of this
Agreement by the Company or any of its Consolidated Subsidiaries), all as determined by a court of
competent jurisdiction.

     Section 11.04. Sharing of Set-offs. Each Lender agrees that if it shall, by exercising any
right of set-off or counterclaim or otherwise, receive payment of a proportion of the aggregate
amount of principal and interest due with respect to

55

 

the Loans and Letter of Credit Liabilities held by it which is greater than the proportion
received by any other Lender in respect of the aggregate amount of principal and interest due with
respect to the Loans and Letter of Credit Liabilities held by such other Lender, the Lender
receiving such proportionately greater payment shall purchase such participations in the Loans and
Letter of Credit Liabilities held by the other Lenders, and such other adjustments shall be made,
as may be required so that all such payments of principal and interest with respect to the Loans
and Letter of Credit Liabilities held by the Lenders shall be shared by the Lenders pro rata;
provided that nothing in this Section 11.04 shall impair the right of any Lender or its affiliates
to exercise any right of set-off or counterclaim it may have and to apply the amount subject to
such exercise to the payment of indebtedness of a Borrower other than its indebtedness hereunder.
Each Borrower agrees, to the fullest extent it may effectively do so under applicable law, that any
holder of a participation in the Loans and Letter of Credit Liabilities, whether or not acquired
pursuant to the foregoing arrangements, may exercise rights of set-off or counterclaim and other
rights with respect to such participation as fully as if such holder of a participation were a
direct creditor of such Borrower in the amount of such participation.

     Section 11.05. Amendments and Waivers. Any provision of this Agreement or the Notes may be
amended or waived if, but only if, such amendment or waiver is in writing and is signed by the
Company and the Required Lenders (and, if the rights or duties of the Administrative Agent or any
Issuing Lender are affected thereby, by it); provided that no such amendment or waiver shall:

     (a) unless signed by each affected Lender, (i) increase the Commitment of any Lender
or subject any Lender to any additional obligation, (ii) reduce the principal of or rate of
interest on any Loan or the amount to be reimbursed in respect of any Letter of Credit or
any interest thereon or any fees hereunder, (iii) postpone the date fixed for any payment
of principal of or interest on any Loan or for reimbursement in respect of any Letter of
Credit or interest thereon or any fees hereunder or for termination of any Commitment, (iv)
release the Company from any obligation under Article 10, (v) permit the subordination of
any payment or right of payment due to the Lenders under the Loan Documents or (vi) modify
the right of a Lender to receive a pro rata share of payments as provided herein;

     (b) unless signed by all the Lenders, change the definition of “Required Lenders” or
the provisions of this Section 11.05; or

     (c) unless signed by an Eligible Subsidiary, (w) subject such Eligible Subsidiary to
any additional obligation, (x) increase the principal of or rate of interest on any
outstanding Loan of such Eligible Subsidiary,

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     (y) accelerate the stated maturity of any outstanding Loan of such Eligible Subsidiary
or (z) change this proviso.

It is understood that the operation of Sections 2.01(c) and 2.20 in accordance with their terms is
not an amendment subject to this Section 11.05.

     Section 11.06. Successors and Assigns.

     (a) The provisions of this Agreement shall be binding upon and inure to the benefit of the
parties hereto and their respective successors and assigns, except that no Borrower may assign or
otherwise transfer any of its rights under this Agreement without the prior written consent of all
Lenders.

     (b) Any Lender may at any time grant to one or more Persons (each a “Participant”)
participating interests in its Commitment and/or any or all of its Loans and Letter of Credit
Liabilities. In the event of any such grant by a Lender of a participating interest to a
Participant, whether or not upon notice to any Borrower and the Administrative Agent, such Lender
shall remain responsible for the performance of its obligations hereunder, and the Borrowers, the
Issuing Lenders and the Administrative Agent shall continue to deal solely and directly with such
Lender in connection with such Lender’s rights and/or obligations hereunder. Any agreement
pursuant to which any Lender may grant such a participating interest shall provide that such Lender
shall retain the sole right and responsibility to enforce the obligations of the Borrowers
hereunder including, without limitation, the right to approve any amendment, modification or waiver
of any provision hereof; provided that such participation agreement may provide that such Lender
will not agree to any modification, amendment or waiver of this Agreement described in clause (a)
of Section 11.05 without the consent of the Participant. The Borrowers agree that each Participant
shall, to the extent provided in its participation agreement, be entitled to the benefits of
Section 2.14 and Article 8 with respect to its participating interest. An assignment or other
transfer which is not permitted by subsection 11.06(c), 11.06(d) or 11.06(f) below shall be given
effect for purposes of this Agreement only to the extent of a participating interest granted in
accordance with this subsection 11.06(b).

     (c) Any Lender may at any time assign to one or more banks or other institutions (each an
“Assignee”) all, or a proportionate part (equivalent to an initial Commitment of not less than
$10,000,000) of all, of its rights and obligations under this Agreement and the Notes, and such
Assignee shall assume such rights and obligations, pursuant to an Assignment and Assumption
Agreement in substantially the form of Exhibit G hereto executed by such Assignee and such
transferor Lender, with (and subject to) the subscribed consent of the Company, the Administrative
Agent and each Issuing Lender, such consents not to be unreasonably withheld or delayed; provided
that if an Assignee is a Lender Affiliate of such transferor Lender or was a Lender immediately
prior

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to such assignment, no such consent of the Company shall be required. Upon execution and
delivery of such instrument and payment by such Assignee to such transferor Lender of an amount
equal to the purchase price agreed between such transferor Lender and such Assignee, such Assignee
shall be a Lender party to this Agreement and shall have all the rights and obligations of a Lender
with a Commitment as set forth in such instrument of assumption, and the transferor Lender shall be
released from its obligations hereunder to a corresponding extent, and no further consent or action
by any party shall be required. Upon the consummation of any assignment pursuant to this
subsection, the transferor Lender, the Administrative Agent and the Borrowers shall make
appropriate arrangements so that, if required, new Notes are issued to the Assignee. In connection
with any such assignment, the transferor Lender shall pay to the Administrative Agent an
administrative fee for processing such assignment in the amount of $2,500.

     (d) Any Lender may at any time assign all or any portion of its rights under this Agreement
and its Notes to a Federal Reserve Bank. No such assignment shall release the transferor Lender
from its obligations hereunder.

     (e) No Assignee, Participant or other transferee of any Lender’s rights shall be entitled to
receive any greater payment under Section 8.03 or 8.04 than such Lender would have been entitled to
receive with respect to the rights transferred, unless such transfer is made with the Company’s
prior written consent or by reason of the provisions of Section 8.02, 8.03 or 8.04 requiring such
Lender to designate a different Applicable Lending Office under certain circumstances or at a time
when the circumstances giving rise to such greater payment did not exist.

     (f) Notwithstanding anything to the contrary contained in this Section 11.06, but subject to
the terms and conditions set forth in this subsection (f), any Lender may from time to time, elect
to designate a Conduit to provide all or any part of any Loan required to be made by such Lender
pursuant to this Agreement or to acquire a participation interest in any Loans extended by such
Lender hereunder (a “Conduit Designation”), provided the designation of a Conduit by any Lender for
purposes of this Section 11.06(f) shall be subject to the approval of the Company, which shall not
be unreasonably withheld. No additional Note shall be required with regard to a Conduit
Designation; provided, however, to the extent any Conduit shall advance funds under a Conduit
Designation, the designating Lender shall be deemed to hold the Note in its possession as an
Administrative Agent for such Conduit to the extent of the Loan funded by such Conduit.
Notwithstanding any such Conduit Designation, (x) the designating Lender shall remain solely
responsible to the other parties hereto for its obligations under this Agreement and (y) the
Borrowers and the Administrative Agent may continue to deal solely and directly with the
designating Lender as Administrative Agent for such designating Lender’s Conduit, in connection
with

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all of such Conduit’s rights and obligations under this Agreement, unless and until the
Company and the Administrative Agent are notified that the designating Lender has been replaced as
Administrative Agent for its Conduit; any payments for the benefit of any designating Lender and
its Conduit shall be paid to such designating Lender for itself as Administrative Agent for its
Conduit, as applicable; provided neither the Administrative Agent nor any Borrower shall be
responsible for any designating Lender’s application of any such payments. In addition, any
Conduit may (i) with notice to, but without the consent of the Company and the Administrative
Agent, and without paying any processing fee therefor, assign all or portions of its interest in
any Loans to the Lender that designated such Conduit or to any financial institutions consented to
by the Company and the Administrative Agent providing liquidity and/or credit facilities to or for
the account of such Conduit to support the funding or maintenance of Loans and (ii) disclose on a
confidential basis any non-public information relating to its Loans to any rating agency,
commercial paper dealer or provider of any guarantee, surety, credit or liquidity enhancement to
such Conduit.

     (g) Each party to this Agreement hereby agrees that, at any time a Conduit Designation is in
effect, it shall not institute against, or join any other person in instituting against, any
Conduit any bankruptcy, reorganization, arrangement, insolvency or liquidation proceeding or other
proceedings under any federal or state bankruptcy or similar law, for one year and a day after the
latest maturing commercial paper note issued by such Conduit is paid. This Section 11.06(g) shall
survive the termination of this Agreement.

     Section 11.07. Collateral. Each of the Lenders represents to the Administrative Agent and
each of the other Lenders that it in good faith is not relying upon any “margin stock” (as defined
in Regulation U) as collateral in the extension or maintenance of the credit provided for in this
Agreement.

     Section 11.08. Governing Law; Submission to Jurisdiction. This Agreement and each Note
shall be governed by and construed in accordance with the laws of the State of New York. Each
Borrower and each Lender hereby submits, to the fullest extent permitted by applicable law, to the
nonexclusive jurisdiction of the United States District Court for the Southern District of New York
and of any New York State court sitting in New York City for purposes of all legal proceedings
arising out of or relating to this Agreement or the transactions contemplated hereby. Each
Borrower and each Lender irrevocably waives, to the fullest extent permitted by law, any objection
which it may now or hereafter have to the laying of the venue of any such proceeding brought in
such a court and any claim that any such proceeding brought in such a court has been brought in an
inconvenient forum.

     Section 11.09. Counterparts; Integration. This Agreement may be signed in any number of
counterparts, each of which shall be an original, with the same

59

 

effect as if the signatures thereto and hereto were upon the same instrument. This Agreement
constitutes the entire agreement and understanding among the parties hereto and supersedes any and
all prior agreements and understandings, oral or written, relating to the subject matter hereof.

     Section 11.10. Waiver of Jury Trial. EACH OF THE BORROWERS, THE ADMINISTRATIVE AGENT AND
THE LENDERS HEREBY IRREVOCABLY WAIVES ANY AND ALL RIGHT TO TRIAL BY JURY IN ANY LEGAL PROCEEDING
ARISING OUT OF OR RELATING TO THIS AGREEMENT OR THE TRANSACTIONS CONTEMPLATED HEREBY.

     Section 11.11. Confidentiality.

     (a) The Lenders agree not to disclose, directly or indirectly, any information obtained from
the Company or any of its Consolidated Subsidiaries in connection with this Agreement and
identified as proprietary at the time it is so disclosed, and will, to the extent practicable, make
all efforts to have all such information kept confidential; provided that (i) each Lender may use,
retain and disclose any such information to its affiliates, directors, officers, agents, employees,
insurance brokers, counsel, public accountants, any Participants, potential Assignees and
Participants and any governmental agency or instrumentality or other supervisory body requesting
such disclosure, provided that any Participants or potential Assignees or Participants shall have
agreed to keep such information confidential in accordance with this Section 11.11, (ii) each
Lender may use, retain and disclose any such information which has been publicly disclosed (other
than by such Lender or any Lender Affiliate thereof in breach of this Section 11.11), and (iii) to
the extent that such Lender may have received a subpoena or other legal demand for such
information, such Lender may disclose such information; provided that such Lender shall notify the
Company of such demand (to the extent permitted by law and as promptly as practicable) and shall
cooperate with the Company, at the Company’s expense, to take actions necessary to obtain a
protective order limiting the scope of the demand and the use and disclosure of such information.

     (b) The parties hereby agree that, from the commencement of discussions with respect to the
transactions contemplated by this Agreement (the “Transactions”), each party (and each employee,
representative or other agent of such party) may disclose to any and all persons, without
limitation of any kind, the tax treatment and tax structure (as such terms are used in Sections
6011, 6111 and 6112 of the Internal Revenue Code and the Treasury Regulations promulgated
thereunder) of the Transactions and all materials of any kind (including opinions or other tax
analyses) that are provided to such party relating to such tax treatment and tax structure, other
than any information for which nondisclosure is reasonably necessary in order to comply with
applicable securities laws.

60

 

     IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be duly executed by their
respective authorized officers as of the day and year first above written.

	 	 	 	 	 	 	 
	 	 	JOHNSON CONTROLS, INC.	 	 
	 
	 	 	 	 	 	 
	 

	 	By:
	 	/s/ R. Bruce McDonald	 	 
	 

	 	 	 	 	 	 
	 

	 	 	 	Title: VP/Chief Financial Officer	 	 
	 
	 	 	 	 	 	 
	 

	 	By:
	 	/s/ Frank Voltolina	 	 
	 

	 	 	 	 	 	 
	 

	 	 	 	Title: VP/Treasurer	 	 
	 
	 	 	 	 	 	 
	 	 	JPMORGAN CHASE BANK, N.A., as	 	 
	 	 	     Administrative Agent and as Lender	 	 
	 
	 	 	 	 	 	 
	 

	 	By:
	 	/s/ Karen M. Sharf	 	 
	 

	 	 	 	 	 	 
	 

	 	 	 	Title: Vice President	 	 
	 
	 	 	 	 	 	 
	 	 	BANK OF AMERICA, N.A.	 	 
	 
	 	 	 	 	 	 
	 

	 	By:
	 	/s/ Chas McDonnell	 	 
	 

	 	 	 	 	 	 
	 

	 	 	 	Title: SVP	 	 
	 
	 	 	 	 	 	 
	 	 	BARCLAYS BANK PLC	 	 
	 
	 	 	 	 	 	 
	 

	 	By:
	 	/s/ Alison McGuigan	 	 
	 

	 	 	 	 	 	 
	 

	 	 	 	Title: Associate Director	 	 
	 
	 	 	 	 	 	 
	 	 	CITIBANK, N.A.	 	 
	 
	 	 	 	 	 	 
	 

	 	By:
	 	/s/ Paul L Burroughs Jr.	 	 
	 

	 	 	 	 	 	 
	 

	 	 	 	Title: Director	 	 
	 
	 	 	 	 	 	 

 

 

	 	 	 	 	 	 	 
	 	 	COMMERZBANK AG, NEW YORK AND GRAND	 	 
	 	 	     CAYMAN BRANCHES	 	 
	 
	 	 	 	 	 	 
	 

	 	By:
	 	/s/ John Marlatt	 	 
	 

	 	 	 	 	 	 
	 

	 	 	 	Title: Senior Vice President	 	 
	 
	 	 	 	 	 	 
	 	 	COMMERZBANK AG, NEW YORK AND GRAND	 	 
	 	 	     CAYMAN BRANCHES	 	 
	 
	 	 	 	 	 	 
	 

	 	By:
	 	/s/ Hajo Neugartner	 	 
	 

	 	 	 	 	 	 
	 

	 	 	 	Title: Vice President	 	 
	 
	 	 	 	 	 	 
	 	 	ING BANK N.V. DUBLIN BRANCH	 	 
	 
	 	 	 	 	 	 
	 

	 	By:
	 	/s/ Alan Duffy	 	 
	 

	 	 	 	 	 	 
	 

	 	 	 	Title: Director	 	 
	 
	 	 	 	 	 	 
	 	 	ING BANK N.V. DUBLIN BRANCH	 	 
	 
	 	 	 	 	 	 
	 

	 	By:
	 	/s/ Aidan Neill	 	 
	 

	 	 	 	 	 	 
	 

	 	 	 	Title: Vice President	 	 
	 
	 	 	 	 	 	 
	 	 	MIZUHO CORPORATE BANK, LTD.	 	 
	 
	 	 	 	 	 	 
	 

	 	By:
	 	/s/ Robert Gallagher	 	 
	 

	 	 	 	 	 	 
	 

	 	 	 	Title: Senior Vice President and Team Leader	 	 

 

 

	 	 	 	 	 	 	 
	 	 	U.S. BANK, NATIONAL ASSOCIATION	 	 
	 
	 	 	 	 	 	 
	 

	 	By:
	 	/s/ Caroline V. Krider	 	 
	 

	 	 	 	 	 	 
	 

	 	 	 	Title: Vice President and Sr. Lender	 	 
	 
	 	 	 	 	 	 
	 	 	WELLS FARGO BANK, N.A.	 	 
	 
	 	 	 	 	 	 
	 

	 	By:
	 	/s/ Melissa Nachman	 	 
	 

	 	 	 	 	 	 
	 

	 	 	 	Title: Vice President	 	 
	 
	 	 	 	 	 	 
	 	 	WELLS FARGO BANK, N.A.	 	 
	 
	 	 	 	 	 	 
	 

	 	By:
	 	/s/ Scott Miller	 	 
	 

	 	 	 	 	 	 
	 

	 	 	 	Title: Vice President	 	 
	 
	 	 	 	 	 	 
	 	 	ABN AMRO BANK N.V..	 	 
	 
	 	 	 	 	 	 
	 

	 	By:
	 	/s/ Pradeep K. Bhatia	 	 
	 

	 	 	 	 	 	 
	 

	 	 	 	Title: Vice President	 	 
	 
	 	 	 	 	 	 
	 	 	ABN AMRO BANK N.V..	 	 
	 
	 	 	 	 	 	 
	 

	 	By:
	 	/s/ Jgnacio Pineros	 	 
	 

	 	 	 	 	 	 
	 

	 	 	 	Title: Vice President	 	 

 

 

	 	 	 	 	 	 	 
	 	 	BANCA INTESA, S.p.A., NEW YORK BRANCH	 	 
	 
	 	 	 	 	 	 
	 

	 	By:
	 	/s/ John J. Michalisin	 	 
	 

	 	 	 	 	 	 
	 

	 	 	 	Title: First Vice President	 	 
	 
	 	 	 	 	 	 
	 	 	BANCA INTESA, S.p.A., NEW YORK BRANCH	 	 
	 
	 	 	 	 	 	 
	 

	 	By:
	 	/s/ Frank Maffei	 	 
	 

	 	 	 	 	 	 
	 

	 	 	 	Title: Vice President	 	 
	 
	 	 	 	 	 	 
	 	 	CALYON NEW YORK BRANCH	 	 
	 
	 	 	 	 	 	 
	 

	 	By:
	 	/s/ Lee E. Greve	 	 
	 

	 	 	 	 	 	 
	 

	 	 	 	Title: Managing Director	 	 
	 
	 	 	 	 	 	 
	 	 	CALYON NEW YORK BRANCH	 	 
	 
	 	 	 	 	 	 
	 

	 	By:
	 	/s/ Thomas P. Gillis	 	 
	 

	 	 	 	 	 	 
	 

	 	 	 	Title: Managing Director	 	 
	 
	 	 	 	 	 	 
	 	 	KBC BANK N.V.	 	 
	 
	 	 	 	 	 	 
	 

	 	By:
	 	/s/ Jean-Pierre Diels	 	 
	 

	 	 	 	 	 	 
	 

	 	 	 	Title: First Vice President	 	 
	 
	 	 	 	 	 	 
	 	 	KBC BANK N.V.	 	 
	 
	 	 	 	 	 	 
	 

	 	By:
	 	/s/ William Cavanaugh	 	 
	 

	 	 	 	 	 	 
	 

	 	 	 	Title: Vice President	 	 

 

 

	 	 	 	 	 	 	 
	 	 	STANDARD CHARTERED BANK	 	 
	 
	 	 	 	 	 	 
	 

	 	By:
	 	/s/ Latita Vadhri	 	 
	 

	 	 	 	 	 	 
	 

	 	 	 	Title: Senior Vice President	 	 
	 
	 	 	 	 	 	 
	 	 	STANDARD CHARTERED BANK	 	 
	 
	 	 	 	 	 	 
	 

	 	By:
	 	/s/ Robert K Reddington	 	 
	 

	 	 	 	 	 	 
	 

	 	 	 	Title: AVP/Credit Documentation	 	 
	 

	 	 	 	          Credit Risk Control	 	 
	 
	 	 	 	 	 	 
	 	 	SVENSKA HANDELSBANKEN	 	 
	 
	 	 	 	 	 	 
	 

	 	By:
	 	/s/ Mark Cleary	 	 
	 

	 	 	 	 	 	 
	 

	 	 	 	Title: Senior Vice President	 	 
	 
	 	 	 	 	 	 
	 	 	SVENSKA HANDELSBANKEN	 	 
	 
	 	 	 	 	 	 
	 

	 	By:
	 	/s/ Nancy Carney	 	 
	 

	 	 	 	 	 	 
	 

	 	 	 	Title: Vice President	 	 
	 
	 	 	 	 	 	 
	 	 	TORONTO DOMINION (TEXAS) LLC	 	 
	 
	 	 	 	 	 	 
	 

	 	By:
	 	/s/ Jim Bridwell	 	 
	 

	 	 	 	 	 	 
	 

	 	 	 	Title: Authorized Signatory	 	 

 

 

COMMITMENT SCHEDULE

	 	 	 	 	 
	Lender	 	Commitment
	JPMorgan Chase Bank, N.A.
	 	$	175,000,000	 
	Bank of America, N.A.
	 	$	145,000,000	 
	Barclays Bank PLC
	 	$	145,000,000	 
	Citibank, N.A.
	 	$	145,000,000	 
	Commerzbank AG, New York and Grand Cayman Branches
	 	$	107,000,000	 
	ING Bank N.V. Dublin Branch
	 	$	107,000,000	 
	Mizuho Corporate Bank, Ltd.
	 	$	107,000,000	 
	U.S. Bank, National Association
	 	$	107,000,000	 
	Wells Fargo Bank, N.A.
	 	$	107,000,000	 
	ABN AMRO Bank, N.V.
	 	$	65,000,000	 
	Banca Intesa, S.p.A., New York Branch
	 	$	65,000,000	 
	Caylon New York Branch
	 	$	65,000,000	 
	KBC Bank, NV
	 	$	65,000,000	 
	Standard Chartered Bank
	 	$	65,000,000	 
	Svenska Handelsbanken
	 	$	65,000,000	 
	Toronto Dominion (Texas) LLC
	 	$	65,000,000	 
	Total Commitments
	 	$	1,600,000,000	 

 

 

PRICING SCHEDULE

     Each of “Facility Fee Rate”, “Euro-Currency Margin” and “Letter of Credit Fee Rate” means, for
any day, the rate set forth below, in basis points per annum, in the row opposite such term and in
the column corresponding to the Pricing Level that applies for such day:

	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	 	 	LEVEL I	 	LEVEL II	 	LEVEL III	 	LEVEL IV	 	LEVEL V
	Facility Fee Rate
	 	 	5.00	 	 	 	7.00	 	 	 	8.00	 	 	 	10.00	 	 	 	12.50	 
	Euro-Currency Margin
and Letter of Credit
Fee Rate:
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	Utilization
£ 50%
	 	 	15.00	 	 	 	18.00	 	 	 	27.00	 	 	 	40.00	 	 	 	62.50	 
	Utilization > 50%
	 	 	27.50	 	 	 	30.50	 	 	 	39.50	 	 	 	52.50	 	 	 	75.00	 

     For purposes of this Schedule, the following terms have the following meanings, subject
to the concluding paragraph of this Schedule:

     “Fitch” means Fitch, Inc.

     “Level I” status exists at any date if, at such date, the Company has senior unsecured
long-term debt outstanding, without third-party credit enhancement, which is rated A+ or higher by
S&P or A1 or higher by Moody’s or A+ or higher by Fitch.

     “Level II” status exists at any date if, at such date, (i) Level I status does not exist and
(ii) the Company has senior unsecured long-term debt outstanding, without third-party credit
enhancement, which is rated A or higher by S&P or A2 or higher by Moody’s or A or higher by Fitch.

     “Level III” status exists at any date if, at such date, (i) neither Level I status nor Level
II status exists and (ii) the Company has senior unsecured long-term debt outstanding, without
third-party credit enhancement, which is rated A- or higher by S&P or A3 or higher by Moody’s or A-
or higher by Fitch.

     “Level IV” status exists at any date if, at such date, (i) none of Level I status, Level II
status or Level III status exists and (ii) the Company has senior unsecured long-term debt
outstanding, without third-party credit enhancement, which is rated BBB+ or higher by S&P or Baa1
or higher by Moody’s or BBB+ or higher by Fitch.

     “Level V” status exists at any date if, at such date, no other Pricing Level status exists.

 

 

     “Moody’s” means Moody’s Investors Service, Inc.

     “Pricing Level” refers to the determination of which of Level I, Level II, Level III, Level IV
or Level V status exists at any date.

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

     “Utilization” means, at any date, the percentage equivalent of a fraction (i) the numerator of
which is the Total Outstanding Amount at such date (after giving effect to any borrowing,
prepayment or repayment on such date) and (ii) the denominator of which is the aggregate amount of
the Commitments at such date (after giving effect to any reduction or termination of the
Commitments on such date). If for any reason the Total Outstanding Amount is not zero immediately
following the termination of the Commitments, Utilization will be deemed to be 100%.

     The credit ratings to be utilized for purposes of this Schedule are those assigned to the
senior unsecured long-term debt securities of the Company without third-party credit enhancement,
and any rating assigned to any other debt security of the Company shall be disregarded. The rating
in effect at any date is that in effect at the close of business on such date. If the Company is
split-rated and the ratings differential between the highest rating and the next highest rating is
one notch, the highest of the three ratings will apply. If the Company is split-rated and the
ratings differential between the highest rating and the next highest rating is more than one notch,
a rating that is one notch lower than the highest of the three ratings shall be used. In the event
that the Company’s senior unsecured long-term debt securities are not rated by any two of S&P,
Moody’s or Fitch, then Level V shall apply.

 

 

SCHEDULE I

ENVIRONMENTAL MATTERS

     The following is a list of sites which the Company or any of its Subsidiaries have been
notified of status as a Potentially Responsible Party (“PRP”) under the Comprehensive Environmental
Response, Compensation and Liability Act of 1980, as amended (“Superfund”) or its state
counterparts, and as to which the Company does not have information sufficient to determine whether
potential liabilities associated with such sites may have a material adverse effect on the
business, financial condition, results of operations or prospects of the Company and its
Consolidated Subsidiaries, considered as a whole. The type of liability may include, but not be
limited to, liability for clean-up and liability to third parties arising out of the business
operations of the sites. The amount of expenditures that will be incurred in connection with
remedial measures at these sites is uncertain because (i) the costs associated with the clean-ups
have not been determined, (ii) the number of companies contributing to the clean-ups has not been
finalized, and/or (iii) the availability of insurance coverage is currently uncertain.

	1.	 	230 Monroe, Michigan
	 
	2.	 	290 Monroe, Michigan
	 
	3.	 	900 N. Michigan Ave. Fuel Spill, Chicago, IL
	 
	4.	 	American Fibrit Oil Spill, Battle Creek, MI
	 
	5.	 	American Lead Secondary Smelter Site, Indianapolis, IN
	 
	6.	 	Auto-Ion Site

Kalamazoo, MI
	 
	7.	 	Avanti Smelter

Indianapolis, IN
	 
	8.	 	Badger Facility, Milwaukee, WI
	 
	9.	 	Bill Johns Waste Oil
	 
	10.	 	Dura Site

Adrian, MI
	 
	11.	 	El Monte Site

El Monte, CA

 

 

	12.	 	Fullerton, CA Plant
	 
	13.	 	Goshen Plan, Goshen, IN
	 
	14.	 	HTWP Site, Thomson, GA
	 
	15.	 	Humboldt Plant, Milwaukee, WI
	 
	16.	 	Interstate Lead Company (ILCO)

Leeds, AL
	 
	17.	 	Keefe Plant, Milwaukee, WI
	 
	18.	 	Lapeer, MI facility
	 
	19.	 	M&J Solvents Remediation Site, Atlanta, GA
	 
	20.	 	Master Metals, Detroit, MI and Cleveland, OH
	 
	21.	 	Metamora Landfill

Lapeer County, MI
	 
	22.	 	National Smelting and Refining Site

Atlanta, GA
	 
	23.	 	NL Industries/Dutchboy Paints

Perth Amboy, NJ
	 
	24.	 	NL Industries/National Smelting of New Jersey Site

Pedricktown, NJ
	 
	25.	 	NL Industries/Taracorp Site

Granite City, IL
	 
	26.	 	Noble Oil Site
	 
	27.	 	Northside Drive Site, Atlanta, GA
	 
	28.	 	Rasmussen Dump Site

Green Oak Township, MI
	 
	29.	 	Renosol Site, Farwell, MI
	 
	30.	 	Ross Metals Site
	 
	31.	 	Servco Pacific v Dixie Wood

 

 

	32.	 	Shiawassee River Site, Howell, MI
	 
	33.	 	Snedicker Site, Saline, MI
	 
	34.	 	Stanley Tool Site

Fowlerville, MI
	 
	35.	 	Tonolli, Corp. Site

Nesquehoning, PA
	 
	36.	 	USS Lead

East Chicago, IN
	 
	37.	 	Watertown Plant, Watertown, WI
	 
	38.	 	Whitmore Lake Facility, Whitmore Lake, MI
	 
	39.	 	Williams-Mesena Landfill, Thomson, GA

     Inclusion of a site on this Schedule I is not an admission that the site poses a material
risk, but rather reflects the inherent uncertainty of the extent of any such liability.

 

 

EXHIBIT A

Form of Note

NOTE

New York, New York                                                

                                                              ,                     

     For value received, <NAME OF RELEVANT BORROWER>, a <RELEVANT BORROWER’S JURISDICTION
OF INCORPORATION> corporation (the “Borrower”), promises to pay to the order of
                                         (the “Lender”), for the account of its Applicable Lending Office, the unpaid
principal amount of each Loan made by the Lender to the Borrower pursuant to the Credit Agreement
referred to below on the last day of the Interest Period relating to such Loan. The Borrower
promises to pay interest on the unpaid principal amount of each such Loan on the dates and at the
rate or rates provided for in the Credit Agreement. All such payments of principal and interest
shall be made (i) if in Dollars, in lawful money of the United States in Federal or other
immediately available funds at the office of JPMorgan Chase Bank, at 270 Park Avenue, New York, New
York or (ii) if in an Alternative Currency, in such funds as may then be customary for the
settlement of international transactions in such Alternative Currency at the place specified for
payment thereof pursuant to the Credit Agreement.

     All Loans made by the Lender, the respective types and maturities thereof and all repayments
of the principal thereof shall be recorded by the Lender and, if the Lender so elects in connection
with any transfer or enforcement hereof, appropriate notations to evidence the foregoing
information with respect to each such Loan then outstanding may be endorsed by the Lender on the
schedule attached hereto, or on a continuation of such schedule attached to and made a part hereof;
provided that the failure of the Lender to make any such recordation or endorsement shall not
affect the obligations of the Borrower hereunder or under the Credit Agreement.

     This
note is one of the Notes referred to in the Credit Agreement dated as
of October ____, 2005 among Johnson Controls, Inc., the Eligible Subsidiaries referred to therein, the Lenders
party thereto and JPMorgan Chase Bank, N.A., as Administrative Agent (as the same may be amended
from time to time, the “Credit Agreement”). Terms defined in the Credit Agreement are used herein
with the same meanings. Reference is made to the Credit Agreement for provisions for the
prepayment hereof and the acceleration of the maturity hereof.

A-1

 

     [The payment in full of the principal and interest on this note has, pursuant to the
provisions of the Credit Agreement, been unconditionally guaranteed by Johnson Controls,
Inc.]1

	 	 	 	 	 	 	 
	 

	 	<NAME OF RELEVANT BORROWER>
	 
	 
	 

	 	By:	 	 	 	 
	 

	 	 	 	 	 	 
	 

	 	 	 	Name:	 	 
	 

	 	 	 	Title:	 	 

 

			
	1  	To be deleted in case of Notes executed and
delivered by the Company.

A-2

 

LOANS AND PAYMENTS OF PRINCIPAL

	 	 	 	 	 	 	 	 	 	 	 
	 	 	 	 	 	 	Amount of	 	 	 	 
	 	 	Amount of	 	Type of	 	Principal	 	 	 	 
	Date	 	Loan	 	Loan	 	Repaid	 	Notation	 	Made By
	 
	 
	 	 	 	 	 	 	 	 	 	 
	 
	 
	 	 	 	 	 	 	 	 	 	 
	 
	 
	 	 	 	 	 	 	 	 	 	 
	 
	 
	 	 	 	 	 	 	 	 	 	 
	 
	 
	 	 	 	 	 	 	 	 	 	 
	 
	 
	 	 	 	 	 	 	 	 	 	 
	 
	 
	 	 	 	 	 	 	 	 	 	 
	 
	 
	 	 	 	 	 	 	 	 	 	 
	 
	 
	 	 	 	 	 	 	 	 	 	 
	 
	 
	 	 	 	 	 	 	 	 	 	 
	 
	 
	 	 	 	 	 	 	 	 	 	 
	 
	 
	 	 	 	 	 	 	 	 	 	 
	 
	 
	 	 	 	 	 	 	 	 	 	 
	 
	 
	 	 	 	 	 	 	 	 	 	 
	 
	 
	 	 	 	 	 	 	 	 	 	 
	 
	 
	 	 	 	 	 	 	 	 	 	 
	 
	 
	 	 	 	 	 	 	 	 	 	 
	 
	 
	 	 	 	 	 	 	 	 	 	 
	 
	 
	 	 	 	 	 	 	 	 	 	 

A-3

 

EXHIBIT B

Opinion of General

Counsel of the Company

October 5, 2005

To the Lenders and the Administrative Agent

   Referred to Below

c/o JPMorgan Chase Bank, N.A.,

   as Administrative Agent

270 Park Avenue

New York, New York 10017

Dear Sirs:

     I have acted as counsel for Johnson Controls, Inc. (the “Company”) in connection with the
Credit Agreement (the “Credit Agreement”) dated as of October 5, 2005 among the Company, the
Eligible Subsidiaries referred to therein, the Lenders party thereto, and JPMorgan Chase Bank,
N.A., as Administrative Agent. Terms defined in the Credit Agreement are used herein as therein
defined.

     For purposes of this opinion, I or others under my supervision have examined originals or
copies, certified or otherwise identified to my satisfaction, of such documents, corporate records,
certificates of public officials and other instruments and have conducted such other investigations
of fact and law as I have deemed necessary or advisable for purposes of this opinion.

     In making such examination, I have assumed the genuineness of all signatures other than those
of the Company, the authenticity of all documents submitted as originals and the conformity to
authentic original documents of all documents submitted as certified, conformed and photostatic
copies. As to questions of facts material to such opinions, I have, when relevant facts were not
independently established by me, relied upon statements made in the documents, records and
certificates referred to above.

     Upon the basis of the foregoing, I am of the opinion that:

     1. The Company is a corporation duly incorporated, validly existing and in good standing under
the laws of Wisconsin and has all corporate powers and all material governmental licenses,
authorizations, consents and approvals required to carry on its business as now conducted.

B-1

 

     2. The execution, delivery and performance by the Company of the Credit Agreement and its
Notes are within the Company’s corporate powers, have been duly authorized by all necessary
corporate action, require no action by or in
respect of, or filing with, any governmental body, agency or official and do not contravene,
or constitute a default under, any provision of applicable law or regulation or of the certificate
of incorporation or by-laws of the Company or of any agreement, judgment, injunction, order, decree
or other instrument binding upon the Company or result in the creation or imposition of any Lien on
any asset of the Company or any of its Consolidated Subsidiaries.

     3. The Credit Agreement has been duly executed by the Company and constitutes a valid and
binding agreement of the Company enforceable against the Company in accordance with its terms,
subject to applicable bankruptcy, insolvency, fraudulent conveyance, reorganization, moratorium or
similar laws affecting the enforcement of creditors’ rights and to general principles of equity.
Each of the Notes has been duly executed by the Company, and each of such Notes constitutes a valid
and binding obligation of the Company, and each of such Notes is enforceable against the Company in
accordance with its respective terms, subject to applicable bankruptcy, insolvency, fraudulent
conveyance, reorganization, moratorium or similar laws affecting the enforcement of creditors’
rights and to general principles of equity.

     4. Except as set forth in the Company’s reports on Form 8-K, Form 10-K and Form 10-Q filed
with the Securities and Exchange Commission pursuant to the Securities and Exchange Act of 1934,
there is no action, suit or proceeding pending against, or to the best of my knowledge threatened
against or affecting, the Company or any of its Consolidated Subsidiaries before any court or
arbitrator or any governmental body, agency or official, in which there is a reasonable possibility
of an adverse decision which could materially adversely affect the business, consolidated financial
position or consolidated results of operations of the Company and its Consolidated Subsidiaries,
considered as a whole, or which in any manner draws into question the validity of the Credit
Agreement or the Notes.

     5. Each of the Company’s corporate Consolidated Subsidiaries is a corporation validly existing
and in good standing under the laws of its jurisdiction of incorporation, and has all corporate
powers and all material governmental licenses, authorizations, consents and approvals required to
carry on its business as now conducted, except those instances where failure to to hold such
powers, licenses, authorizations, consents or approvals would not be expected to have a material
adverse effect on the Company.

     In connection with the foregoing opinion, I wish to point out that I am a member of the Bar of
the State of Wisconsin and do not hold myself out as expert in the laws of other jurisdictions.
However, I have made, or caused to be made,

B-2

 

such investigations or such consultations with counsel
as I have deemed appropriate with respect to the laws of other jurisdictions in connection with
such opinion, and nothing has come to my attention in the course of such investigation which would
lead me to question the correctness of such opinion.

     This opinion may not be relied upon by any other parties without my express written consent;
provided, however, that Davis Polk & Wardwell, counsel for the Administrative Agent, may rely upon
this opinion.

	 	 	 
	 

	 	Very truly yours,
	 
	 	 
	 

	 	Jerome D. Okarma

B-3

 

EXHIBIT C

Opinion of Special Counsel

of the Administrative Agent

October 5, 2005

	 	 	 
	To the Lenders and the Administrative Agent
	 

	 	Referred to Below
	c/o JPMorgan Chase Bank, N.A.,
	 

	 	as Administrative Agent
	270 Park Avenue
	New York, New York 10017

Dear Sirs:

     We have participated in the preparation of the Credit Agreement (the “Credit Agreement”) dated
as of October 5, 2005 among Johnson Controls, Inc., a Wisconsin corporation (the “Company”), the
Eligible Subsidiaries referred to therein, the Lenders party thereto (the “Lenders”), and JPMorgan
Chase Bank, N.A., as Administrative Agent (the “Administrative Agent”), and have acted as special
counsel for the Administrative Agent for the purpose of rendering
this opinion pursuant to Section 3.01(c) of the Credit Agreement. Terms defined in the Credit Agreement are
used herein as therein defined.

     We have examined originals or copies, certified or otherwise identified to our satisfaction,
of such documents, corporate records, certificates of public officials and other instruments and
have conducted such other investigations of fact and law as we have deemed necessary or advisable
for purposes of this opinion.

     Upon the basis of the foregoing, we are of the opinion that the Credit Agreement constitutes a
valid and binding agreement of the Company and each of the Company’s Notes constitutes a valid and
binding obligation of the Company, in each case enforceable in accordance with its terms except as
the same may be limited by bankruptcy, insolvency or similar laws affecting creditors’ rights
generally and by general principles of equity.

     We are members of the Bar of the State of New York and the foregoing opinion is limited to the
laws of the State of New York and the federal laws of the United States of America. Insofar as the
laws of any other jurisdiction are relevant, we have relied, without independent investigation,
upon the opinion of Jerome D. Okarma, general counsel for the Company, a copy of which has been
delivered to you. In giving the foregoing opinion, we express no opinion as to (i) the effect (if
any) of any law of any jurisdiction (except the State of New York) in

C-1

 

which any Lender is located
which limits the rate of interest that such Lender may charge or collect and (ii) the
enforceability of the provisions of Section 2.18.

     This opinion is rendered solely to you in connection with the above matter. This opinion may
not be relied upon by you for any other purpose or relied upon by any other person without our
prior written consent.

	 	 	 
	 

	 	Very truly yours,

C-2

 

EXHIBIT D

Form of Election to Participate

___________, 20__

JPMORGAN CHASE BANK, N.A.

as Administrative Agent for the

Lenders named in the Credit

Agreement dated as of October ____, 2005

among Johnson Controls, Inc.,

the Eligible Subsidiaries referred to therein, the

Lenders party thereto and the Administrative Agent

(the “Credit Agreement”)

Dear Sirs:

     Reference is made to the Credit Agreement described above. Terms not defined herein which are
defined in the Credit Agreement shall have for the purposes hereof the meaning provided therein.

     The undersigned, <NAME OF ELIGIBLE SUBSIDIARY>, a <JURISDICTION OF INCORPORATION>
corporation, hereby elects to be an Eligible Subsidiary for purposes of the Credit Agreement,
effective from the date hereof until an Election to Terminate shall have been delivered on behalf
of the undersigned in accordance with the Credit Agreement. The undersigned confirms that the
representations and warranties set forth in Article 9 of the Credit Agreement are true and correct
as to the undersigned as of the date hereof, and the undersigned hereby agrees to perform all the
obligations of an Eligible Subsidiary under, and to be bound in all respects by the terms of, the
Credit Agreement, including without limitation Section 11.08 thereof, as if the undersigned were a
signatory party thereto.

     [Tax disclosure pursuant to Section 9.04]

     The address to which all notices to the undersigned under the Credit Agreement should be
directed is:

D-1

 

     This instrument shall be construed in accordance with and governed by the laws of the State of
New York.

	 	 	 	 	 	 	 
	 	 	Very truly yours,
	 
	 	 	 	 	 	 
	 	 	<NAME OF ELIGIBLE SUBSIDIARY>
	 
	 	 	 	 	 	 
	 	 	By:
	 	 	 	 	   
	 	 	 	 	Name:
	 	 	 	 	Title:

     The undersigned hereby confirms that <NAME OF ELIGIBLE SUBSIDIARY> is an Eligible
Subsidiary for purposes of the Credit Agreement described above.

	 	 	 	 	 	 	 
	 	 	JOHNSON CONTROLS, INC.
	 
	 	 	 	 	 	 
	 	 	By:
	 	 	 	 	   
	 	 	 	 	Name:
	 	 	 	 	Title:

     Receipt of the above Election to Participate is hereby acknowledged on and as of the date set
forth above.

	 	 	 	 	 	 	 
	 	 	JPMORGAN CHASE BANK, N.A.,
	 	 	    as Administrative Agent
	 
	 	 	 	 	 	 
	 	 	By:
	 	 	 	 	   
	 	 	 	 	Name:
	 	 	 	 	Title:

D-2

 

EXHIBIT E

Form of Election to Terminate

___________, 20__

JPMORGAN CHASE BANK, N.A.,

as Administrative Agent for

the Lenders named in the Credit

Agreement dated as of October ____, 2005

among Johnson Controls, Inc.,

the Eligible Subsidiaries referred

to therein, the Lenders party thereto

and the Administrative Agent (the

“Credit Agreement”)

Dear Sirs:

     Reference is made to the Credit Agreement described above. Terms not defined herein which are
defined in the Credit Agreement shall have for the purposes hereof the meaning provided therein.

     The undersigned, <NAME OF ELIGIBLE SUBSIDIARY>, a <JURISDICTION OF INCORPORATION>
corporation, hereby elects to terminate its status as an Eligible Subsidiary for purposes of the
Credit Agreement, effective as of the date hereof. The undersigned hereby represents and warrants
that all principal and interest on all Notes of the undersigned and all other amounts payable by
the undersigned pursuant to the Credit Agreement have been paid in full on or prior to the date
hereof. Notwithstanding the foregoing, this Election to Terminate shall not affect any obligation
of the undersigned under the Credit Agreement or under any Note heretofore incurred.

E-1

 

     This instrument shall be construed in accordance with and governed by the laws of the State of
New York.

	 	 	 	 	 	 	 
	 	 	Very truly yours,
	 	 	 
	 	 	<NAME OF ELIGIBLE SUBSIDIARY>
	 
	 	 	 	 	 	 
	 	 	By:
	 	 	 	 	   
	 	 	 	 	Name:
	 	 	 	 	Title:

     The undersigned hereby confirms that the status of <NAME OF ELIGIBLE SUBSIDIARY> as an
Eligible Subsidiary for purposes of the Credit Agreement described above is terminated as of the
date hereof.

	 	 	 	 	 	 	 
	 	 	JOHNSON CONTROLS, INC.
	 
	 	 	 	 	 	 
	 	 	By:
	 	 	 	 	   
	 	 	 	 	Name:
	 	 	 	 	Title:

     Receipt of the above Election to Terminate is hereby acknowledged on and as of the date set
forth above.

	 	 	 	 	 	 	 
	 	 	JPMORGAN CHASE BANK, N.A.,
	 

	 	     as Administrative Agent
	 
	 
	 	 	 	 	 	 
	 	 	By:
	 	 	 	 	   
	 	 	 	 	Name:
	 	 	 	 	Title:

E-2

 

EXHIBIT F

Opinion of Counsel of the

Borrower (Borrowings by Eligible

Subsidiaries)

	 	 	 	 	 
	 

	 	 	 	[Dated as provided in
	 

	 	 	 	Section 3.03(a) of the
	 

	 	 	 	Credit Agreement]

To the Lenders and the Administrative Agent

     Referred to Below

c/o JPMorgan Chase Bank, N.A.,

     as Administrative Agent

270 Park Avenue

New York, New York 10017

Dear Sirs:

     I am counsel to <NAME OF ELIGIBLE SUBSIDIARY, JURISDICTION OF INCORPORATION> (the
“Borrower”) and give this opinion pursuant to Section 3.03(a) of the Credit Agreement (the “Credit
Agreement”) dated as of October                    , 2005 among Johnson Controls, Inc. (the “Company”),
the Eligible Subsidiaries referred to therein, the Lenders party thereto and JPMorgan Chase Bank,
N.A., as Administrative Agent. Terms defined in the Credit Agreement are used herein as therein
defined.

     I have examined originals or copies, certified or otherwise identified to my satisfaction, of
such documents, corporate records, certificates of public officials and other instruments and have
conducted such other investigations of fact and law as I have deemed necessary or advisable for
purposes of this opinion.

     Upon the basis of the foregoing, I am of the opinion that:

     1. The Borrower is duly organized, validly existing and in good standing under the laws of
<JURISDICTION OF ORGANIZATION>, and is a Wholly-Owned Consolidated Subsidiary of the Company.

     2. The execution and delivery by the Borrower of its Election to Participate and its Notes and
the performance by the Borrower of the Credit Agreement and its Notes are within the Borrower’s
legal powers, have been duly authorized by all necessary legal action, require no action by or in
respect of, or filing with, any governmental body, agency or official and do not contravene, or
constitute a default under, any provision of applicable law or regulation or of the organizational
documents of the Borrower or of any agreement, judgment,

F-1

 

injunction, order, decree or other instrument binding upon the Borrower or the Company or any
of its Consolidated Subsidiaries or result in the creation or imposition of any Lien on any asset
of the Company or any of its Consolidated Subsidiaries.

     3. The Credit Agreement constitutes a valid and binding agreement of the Borrower and its
Notes constitute valid and binding obligations of the Borrower, in each case enforceable in
accordance with its own terms, subject to applicable bankruptcy, insolvency, fraudulent conveyance
or similar laws affecting the enforcement of creditors’ rights and to general principles of equity.

     4. Except as disclosed in the Borrower’s Election to Participate, there is no income, stamp or
other tax of <JURISDICTION OF INCORPORATION AND, IF DIFFERENT, PRINCIPAL PLACE OF BUSINESS>,
or any taxing authority thereof or therein, imposed by or in the nature of withholding or
otherwise, which is imposed on any payment to be made by the Borrower pursuant to the Credit
Agreement or its Notes, or is imposed on or by virtue of the execution, delivery or enforcement of
its Election to Participate or of its Notes.

	 	 	 	 	 
	 	Very truly yours,	 

F-2

 

EXHIBIT G

Assignment and Assumption Agreement

     AGREEMENT dated as of                     , 20                     between <NAME OF ASSIGNOR> (the “Assignor”) and
<NAME OF ASSIGNEE> (the “Assignee”).

     WHEREAS, this Assignment and Assumption Agreement (the “Agreement”) relates to the Credit
Agreement dated as of October                     , 2005 among Johnson Controls, Inc. (the “Company”), the
Eligible Subsidiaries referred to therein, the Assignor and the other Lenders thereto, as Lenders,
and JPMorgan Chase Bank, N.A., as Administrative Agent (the “Administrative Agent”) (as amended
from time to time, the “Credit Agreement”);

     WHEREAS, as provided under the Credit Agreement, the Assignor has a Commitment to make Loans
and participate in Letters of Credit in an aggregate Dollar Amount at any time outstanding not to
exceed $                    ,000,000;

     WHEREAS, Loans made to the Borrowers by the Assignor under the Credit Agreement in the
aggregate Dollar Amount of $                     are outstanding at the date hereof;

     WHEREAS, Letters of Credit with a total Dollar Amount available for drawing thereunder of
$                     are outstanding at the date hereof; and

     WHEREAS, the Assignor proposes to assign to the Assignee all of the rights of the Assignor
under the Credit Agreement in respect of a portion of its Commitment thereunder in an amount equal
to $                     (the “Assigned Amount”), together with a corresponding portion of its outstanding
Loans and Letter of Credit Liabilities, and the Assignee proposes to accept assignment of such
rights and assume the corresponding obligations from the Assignor on such terms;

     NOW, THEREFORE, in consideration of the foregoing and the mutual agreements contained herein,
the parties hereto agree as follows:

     Section 1. Definitions. All capitalized terms not otherwise defined herein shall
have the respective meanings set forth in the Credit Agreement.

     Section 2. Assignment. The Assignor hereby assigns and sells to the Assignee all of
the rights of the Assignor under the Credit Agreement to the extent of the Assigned Amount, and the
Assignee hereby accepts such assignment from the Assignor and assumes all of the obligations of the
Assignor under the Credit Agreement to the extent of the Assigned Amount, including the purchase
from the Assignor of the corresponding portion of the principal amount of the

G-1

 

Loans made by, and Letter of Credit Liabilities of, the Assignor outstanding at the date
hereof. Upon the execution and delivery hereof by the Assignor, the Assignee and the Company and
the payment of the amounts specified in Section 3 required to be paid on the date hereof (i) the
Assignee shall, as of the date hereof, succeed to the rights and be obligated to perform the
obligations of a Lender under the Credit Agreement with a Commitment in an amount equal to the
Assigned Amount, and (ii) the Commitment of the Assignor shall, as of the date hereof, be reduced
by a like amount and the Assignor released from its obligations under the Credit Agreement to the
extent such obligations have been assumed by the Assignee. The assignment provided for herein
shall be without recourse to the Assignor and without any representations or warranties of any
kind, except that the Assignor is the legal and beneficial owner of the interest being assigned by
it hereunder and that such interest is free and clear of any adverse claim created by the Assignor.

     Section 3. Payments. As consideration for the assignment and sale contemplated in
Section 2 hereof, the Assignee shall pay to the Assignor on the date hereof in Federal funds the
amount heretofore agreed between them.1 It is understood that facility fees and Letter
of Credit fees accrued to the date hereof in respect of the Assigned Amount are for the account of
the Assignor and such fees accruing from and including the date hereof are for the account of the
Assignee. Each of the Assignor and the Assignee hereby agrees that if it receives any amount under
the Credit Agreement which is for the account of the other party hereto, it shall receive the same
for the account of such other party to the extent of such other party’s interest therein and shall
promptly pay the same to such other party.

     Section 4. Consent of the Company. This Agreement is conditioned upon the consent
of [the Company,] the Administrative Agent and each Issuing Lender pursuant to Section 11.06(c) of
the Credit Agreement. The execution of this Agreement by them is evidence of this consent.
Pursuant to Section 11.06(c), the Company shall execute and deliver a Note and to cause each
Eligible Subsidiary to execute and deliver a Note payable to the order of the Assignee to evidence
the assignment and assumption provided for herein.

     Section 5. Non-reliance on Assignor. The Assignor makes no representation or
warranty in connection with, and shall have no responsibility with respect to, the solvency,
financial condition, or statements of any Borrower, or the validity and enforceability of the
obligations of any Borrower in respect of

 

			
	1	 	Amount should combine principal together
with accrued interest and breakage compensation, if any, to be paid by the
Assignee, net of any portion of any upfront fee to be paid by the Assignor to
the Assignee. It may be preferable in an appropriate case to specify these
amounts generically or by formula rather than as a fixed sum.

G-2

 

the Credit Agreement or any Note. The Assignee acknowledges that it has, independently and
without reliance on the Assignor, and based on such documents and information as it has deemed
appropriate, made its own credit analysis and decision to enter into this Agreement and will
continue to be responsible for making its own independent appraisal of the business, affairs and
financial condition of the Borrowers.

     Section 6. Governing Law. This Agreement shall be governed by and construed in
accordance with the laws of the State of New York.

     Section 7. Counterparts. This Agreement may be signed in any number of
counterparts, each of which shall be an original, with the same effect as if the signatures thereto
and hereto were upon the same instrument.

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

	 	 	 	 	 	 	 
	 	 	<NAME OF ASSIGNOR>	 	 
	 
	 	 	 	 	 	 
	 

	 	By:	 	 	 	 
	 

	 	 	 	 

Name:
	 	 
	 

	 	 	 	Title:	 	 

	 	 	 	 	 	 	 
	 	 	<NAME OF ASSIGNEE>	 	 
	 
	 	 	 	 	 	 
	 

	 	By:	 	 	 	 
	 

	 	 	 	 

Name:
	 	 
	 

	 	 	 	Title:	 	 

	 	 	 	 	 	 	 
	 	 	JOHNSON CONTROLS, INC.	 	 
	 
	 	 	 	 	 	 
	 

	 	By:	 	 	 	 
	 

	 	 	 	 

Name:
	 	 
	 

	 	 	 	Title:	 	 

G-3

 

	 	 	 	 	 	 	 
	 	 	JPMORGAN CHASE BANK, N.A.,	 	 
	 	 	     as Administrative Agent and as	 	 
	 	 	     Issuing Lender	 	 
	 
	 	 	 	 	 	 
	 

	 	By:	 	 	 	 
	 

	 	 	 	 

Name:
	 	 
	 

	 	 	 	Title:	 	 
	 
	 	 	 	 	 	 
	 	 	CITIBANK, N.A.,	 	 
	 	 	     as Issuing Lender	 	 

	 	 	 	 	 	 	 
	 

	 	By:	 	 	 	 
	 

	 	 	 	 

Name:
	 	 
	 

	 	 	 	Title:	 	 

G-4

 

EXHIBIT H

Mandatory Costs Rate

MANDATORY COSTS RATE

	1.	 	Definitions
	 
	 	 	In this Exhibit:
	 
	 	 	“Act” means the Bank of England Act of 1998.
	 
	 	 	The terms “Eligible Liabilities” and “Special Deposits” have the meanings
ascribed to them under or pursuant to the Act or by the Bank of England (as may
be appropriate), on the day of the application of the formula.
	 
	 	 	“Fee Base” has the meaning ascribed to it for the purposes of, and shall be
calculated in accordance with, the Fees Regulations.
	 
	 	 	“Fees Regulations” means, as appropriate, either:

	 	(a)	 	the Banking Supervision (Fees) Regulations 1998; or
	 
	 	(b)	 	such regulations as from time to time may be in force,
relating to the payment of fees for banking supervision in respect of
periods subsequent to March 31, 1999.

	 	 	“FSA” means the Financial Services Authority.
	 
	 	 	Any reference to a provision of any statute, directive, order or regulation
herein is a reference to that provision as amended or re-enacted from time to
time.

	2.	 	Calculation of the Mandatory Costs Rate
	 
	 	 	The Mandatory Costs Rate is an addition to the interest rate on each
Euro-Currency Loan or any other sum on which interest is to be calculated to
compensate the Lenders for the cost attributable to each Euro-Currency Loan or
such sum resulting from the imposition from time to time under or pursuant to the
Act and/or by the Bank of England and/or the FSA (or other United Kingdom
governmental authorities or agencies) of a requirement to place non-interest
bearing or Special Deposits (whether interest bearing or not) with the Bank of
England and/or pay fees to the FSA

H-1

 

	 	 	calculated by reference to liabilities used to
fund the relevant Euro-Currency Loan or such sum.
	 
	 	 	The “Mandatory Costs Rate” will be the rate determined by the Agent to be the
rate resulting from the application of the following formula:
	 
	 	 	For Sterling:

	 	 	 	 	 
	 

	 	XL + S(L – D) + Fx 0.01	 	 
	 

	 	 

100 – (X + S)
	 	 

	 	 	For Euro:

	 	 	 	 	 
	 

	 	Fx 0.01	 	 
	 

	 	 

300
	 	 
	 
	 	 	 	 
	 	 	where on the day of application of the formula:

	 	 	 
	X

	 	is the percentage of Eligible Liabilities (in excess of any stated minimum)
by reference to which JPMorgan Chase Bank (or its Applicable Lending Office) is
required under or pursuant to the Act to maintain cash ratio deposits with the Bank
of England;
	 
	 	 
	L

	 	is the rate of interest (exclusive of Euro-Currency Margin and Mandatory
Costs Rate) payable on that day on the related Euro-Currency Loan or unpaid sum
pursuant to this Agreement;
	 
	 	 
	F

	 	is the rate of charge payable by JPMorgan Chase Bank (or its Applicable
Lending Office) to the FSA pursuant to the Fees Regulations and expressed in pounds
per ,1 million of its Fee Base;
	 
	 	 
	S

	 	is the level of interest-bearing Special Deposits, expressed as a
percentage of Eligible Liabilities, which JPMorgan Chase Bank (or its Applicable
Lending Office) is required to maintain by the Bank of England (or other United
Kingdom governmental authorities or agencies); and
	 
	 	 
	D

	 	is the percentage rate per annum payable by the Bank of England to such
Reference Lender on Special Deposits.

H-2

 

	 	 	 
	 

	 	(X, L, S and D are to be expressed in the formula as numbers and not as
percentages. A negative result obtained from subtracting D from L shall be
counted as zero.)
	 
	 	 
	 

	 	
The Mandatory Costs Rate attributable to a Euro-Currency Loan or other sum for
any period shall be calculated at or about 11:00 A.M. (London time) on the first
day of such period for the duration of such period.
	 
	 	 
	 

	 	The determination of Mandatory Costs Rate by the Administrative Agent in relation
to any period shall, in the absence of manifest error, be conclusive and binding
on all parties hereto.
	 
	 	 
	3.

	 	Change of Requirements
	 
	 	 
	 

	 	If there is any change in circumstance (including the imposition of alternative
or additional requirements) which in the reasonable opinion of the Administrative
Agent renders or will render the above formula (or any element thereof, or any
defined term used therein) inappropriate or inapplicable, the Administrative
Agent shall (with the written consent of the Company which shall not be
unreasonably withheld) be entitled to vary the same. Any such variation shall,
in the absence of manifest error, be conclusive and binding on all parties and
shall apply from the date specified in such notice.

H-3

 

EXHIBIT I – Extension Agreement

EXTENSION AGREEMENT

JPMorgan Chase Bank, N.A., as Administrative Agent

     under the Credit Agreement referred to below

270 Park Avenue

New York, New York 10017

Ladies and Gentlemen:

     Effective as of [date], the undersigned hereby agrees to extend its Commitment and the
Termination Date under the Credit Agreement dated as of October
        , 2005 (the “Credit
Agreement”) among Johnson Controls, Inc. (the “Borrower”) and the Eligible Subsidiaries referred to
therein and the Lenders thereto and JP Morgan Chase Bank, N.A., as Administrative Agent, for ___
days to <DATE TO WHICH THE TERMINATION DATE IS TO BE EXTENDED> pursuant to Section 2.01(c) of
the Credit Agreement. Terms defined in the Credit Agreement are used herein as therein defined.

     This Extension Agreement shall be construed in accordance with and governed by the law of the
State of New York. This Extension Agreement may be signed in any number of counterparts, each of
which shall be an original, with the same effect as if the signatures thereto and hereto were upon
the same instrument.

	 	 	 	 	 	 	 
	 
	 	 	 	 	 	 
	 	 	[NAME OF BANK]	 	 
	 
	 	 	 	 	 	 
	 

	 	By:	 	 	 	 
	 

	 	 	 	 

Name:

	 	 
	 

	 	 	 	Title:	 	 

I-1

 

	 	 	 	 	 
	Agreed and Accepted:	 	 
	 
	 	 	 	 
	JOHNSON CONTROLS, INC.	 	 
	as Borrower	 	 

	 	 	 	 	 
	By:
	 	 	 	 
	 

	 	 

Name:
	 	 
	 

	 	Title:	 	 

	 	 	 
	JPMORGAN CHASE BANK, N.A.,

as Administrative Agent
	 
	 	 

	 	 	 	 	 
	By:
	 	 	 	 
	 

	 	 

Name:
	 	 
	 

	 	Title:	 	 

I-2<PAGE>
                                                                     Exhibit 4.1

                                   ----------

                              CKE RESTAURANTS, INC.

                                       and

                          MELLON INVESTOR SERVICES LLC

                                 as Rights Agent

                                   ----------

                                Rights Agreement
                          Dated as of October 10, 2005

                                   ----------
<PAGE>
                                TABLE OF CONTENTS

<TABLE>
<CAPTION>
                                                                            PAGE
                                                                            ----
<S>                                                                         <C>
Section 1.    Certain Definitions........................................     1
Section 2.    Appointment of Rights Agent................................     6
Section 3.    Issuance of Rights Certificates............................     7
Section 4.    Form of Rights Certificates................................     8
Section 5.    Countersignature and Registration..........................     9
Section 6.    Transfer, Split Up, Combination and Exchange of Rights
              Certificates; Mutilated, Destroyed, Lost or Stolen Rights
              Certificates...............................................    10
Section 7.    Exercise of Rights; Purchase Price; Expiration Date of
              Rights.....................................................    11
Section 8.    Cancellation and Destruction of Rights Certificates........    13
Section 9.    Reservation and Availability of Capital Stock..............    13
Section 10.   Preferred Stock Record Date................................    14
Section 11.   Adjustment of Purchase Price, Number and Kind of Shares or
              Number of Rights...........................................    14
Section 12.   Certificate of Adjusted Purchase Price or Number of
              Shares.....................................................    22
Section 13.   Consolidation, Merger or Sale or Transfer of Assets or
              Earning Power..............................................    22
Section 14.   Fractional Rights and Fractional Shares....................    25
Section 15.   Rights of Action...........................................    26
Section 16.   Agreement of Rights Holders................................    27
Section 17.   Rights Certificate Holder Not Deemed a Stockholder.........    27
Section 18.   Concerning the Rights Agent................................    27
Section 19.   Merger or Consolidation or Change of Name of Rights Agent..    28
Section 20.   Rights and Duties of Rights Agent..........................    28
Section 21.   Change of Rights Agent.....................................    31
Section 22.   Issuance of New Rights Certificates........................    31
Section 23.   Redemption.................................................    32
Section 24.   Exchange...................................................    34
Section 25.   Notice of Certain Events...................................    35
Section 26.   Notices....................................................    36
Section 27.   Supplements and Amendments.................................    37
Section 28.   Successors.................................................    37
Section 29.   Determinations and Actions by the Board of Directors, etc..    37
Section 30.   Benefits of this Agreement.................................    38
Section 31.   Severability...............................................    38
Section 32.   Governing Law..............................................    38
Section 33.   Counterparts...............................................    38
Section 34.   Descriptive Headings.......................................    38
</TABLE>

<TABLE>
<CAPTION>
EXHIBITS
--------
<S>         <C>
Exhibit A   Form of Certificate of Designation
Exhibit B   Form of Rights Certificate
Exhibit C   Summary of Rights
</TABLE>

                                        i
<PAGE>
                                RIGHTS AGREEMENT

     This Rights Agreement, dated as of October 10, 2005 (the "Agreement"), is
made by and between CKE Restaurants, Inc., a Delaware corporation (the
"Company"), and Mellon Investor Services LLC, a New Jersey limited liability
company, as Rights Agent (the "Rights Agent").

                                   WITNESSETH:

     WHEREAS, on October 4, 2005 (the "Rights Dividend Declaration Date"), the
Board of Directors of the Company authorized and declared a dividend
distribution of one Right (as hereinafter defined) for each share of Common
Stock, par value $0.01 per share, of the Company outstanding at the Close of
Business on October 17, 2005 (the "Record Date"), and has authorized the
issuance of one Right (as such number may hereinafter be adjusted pursuant to
the provisions of Section 11(p) hereof) for each share of Common Stock of the
Company issued between the Record Date (whether originally issued or delivered
from the Company's treasury) and the Distribution Date (as defined in Section 3
hereof), each Right initially representing the right to purchase one
one-hundredth of a share of Series A Junior Participating Preferred Stock of the
Company, $0.01 par value, having the rights, powers and preferences set forth in
the form of Certificate of Designation, Preferences and Rights attached hereto
as Exhibit A, upon the terms and subject to the conditions hereinafter set forth
(the "Rights");

     NOW, THEREFORE, in consideration of the premises and the mutual agreements
herein set forth, the parties hereby agree as follows:

                                   AGREEMENT:

     SECTION 1. CERTAIN DEFINITIONS. For purposes of this Agreement, the
following terms have the meanings indicated:

          (a) "Acquiring Person" shall mean any Person who or which, together
with all Affiliates and Associates of such Person, shall be the Beneficial Owner
of fifteen percent (15%) or more of the shares of Common Stock then outstanding,
but shall not include the Company, any Subsidiary of the Company, any employee
benefit plan of the Company or of any Subsidiary of the Company, or any Person
or entity organized, appointed or established by the Company for or pursuant to
the terms of any such employee benefit plan. In addition, notwithstanding the
foregoing, no Person shall be deemed to be an Acquiring Person if (i) the Board
of Directors of the Company determines in good faith that a person who would
otherwise be an "Acquiring Person," but for the operation of this clause (i),
has become such inadvertently, and such person divests as promptly as practical
a sufficient number of shares of Common Stock so that such person would no
longer be an "Acquiring Person," (ii) as the result of an acquisition of Common
Stock by the Company which, by reducing the number of shares outstanding,
increases the proportionate number of shares beneficially owned by such Person
to fifteen percent (15%) or more of the Common Stock of the Company then
outstanding; provided, however, that if a Person shall become the Beneficial
Owner of fifteen percent (15%) or more of the Common Stock of the Company then
outstanding by reason of share purchases by the Company and shall, after such
share purchases by the Company, become the Beneficial Owner (other than by way
of a stock dividend or stock split) of additional shares of Common Stock
representing one-half of one percent (.50%) of the then outstanding shares of
<PAGE>
Common Stock of the Company, then such Person shall be deemed to be an Acquiring
Person, or (iii) a Person enters into an agreement or transaction or
understanding with the Company whereby, solely as a consequence of that
agreement or transaction or understanding, such Person would become an
"Acquiring Person" (but for the operation of this clause (iii)), and such
agreement, transaction or understanding is approved by a majority of the Board
of Directors of the Company; provided, however, that if such Person subsequently
becomes the Beneficial Owner of any additional shares of Common Stock in a
manner not specifically approved by a majority of the Board of Directors, such
Person shall be deemed to be an Acquiring Person.

          (b) "Affiliate" and "Associate" shall have the respective meanings
ascribed to such terms in Rule 12b-2 of the General Rules and Regulations under
the Exchange Act, as in effect on the date of this Agreement.

          (c) A Person shall be deemed the "Beneficial Owner" of, and shall be
deemed to "beneficially own," any securities:

               (i) which such Person or any of such Person's Affiliates or
Associates beneficially owns, directly or indirectly;

               (ii) which such Person or any of such Person's Affiliates or
Associates, directly or indirectly, has the right to acquire (whether such right
is exercisable immediately or only after the passage of time) pursuant to any
agreement, arrangement or understanding (whether or not in writing) or upon the
exercise of conversion rights, exchange rights, rights, warrants or options, or
otherwise; provided, however, that a Person shall not be deemed the "Beneficial
Owner" of, or to "beneficially own," (A) securities tendered pursuant to a
tender or exchange offer made by such person or any of such Person's Affiliates
or Associates until such tendered securities are accepted for purchase or
exchange, or (B) securities which a Person or any of such Person's Affiliates or
Associates may be deemed to have the right to acquire pursuant to any merger or
other acquisition agreement between the Company and such Person (or one or more
of its Affiliates or Associates) if such agreement has been approved by the
Board of Directors of the Company prior to there being an Acquiring Person, or
(C) securities issuable upon exercise of Rights at any time prior to the
occurrence of a Triggering Event, or (D) securities issuable upon exercise of
Rights from and after the occurrence of a Triggering Event which Rights were
acquired by such Person or any of such Person's Affiliates or Associates prior
to the Distribution Date or pursuant to Section 3(a) or Section 22 hereof (the
"Original Rights") or pursuant to Section 11(i) hereof in connection with an
adjustment made with respect to any Original Rights;

               (iii) which such Person or any of such Person's Affiliates or
Associates, directly or indirectly, has the right to vote or dispose of or
"beneficial ownership" of (as determined pursuant to Rule 13d-3 of the General
Rules and Regulations under the Exchange Act), including pursuant to any
agreement, arrangement or understanding, whether or not in writing; provided,
however, that a Person shall not be deemed the "Beneficial Owner" of, or to
"beneficially own," any security under this subparagraph (iii) as a result of an
agreement, arrangement or understanding to vote such security if such agreement,
arrangement or understanding: (A) arises solely from a revocable proxy given in
response to a public proxy or consent solicitation made pursuant to, and in
accordance with, the applicable provisions of the General Rules and Regulations
under the Exchange Act, and (B) is not also then reportable by such Person on
Schedule 13D under the Exchange Act (or any comparable or successor report); or

                                       2
<PAGE>
               (iv) which are beneficially owned, directly or indirectly, by any
other Person (or any Affiliate or Associate thereof) with which such Person (or
any of such Person's Affiliates or Associates) has any agreement, arrangement or
understanding (whether or not in writing), for the purpose of acquiring,
holding, voting (except pursuant to a revocable proxy as described in the
proviso to subparagraph (iii) of this paragraph (c)) or disposing of any voting
securities of the Company; provided, however, that nothing in this paragraph (c)
shall cause a person engaged in business as an underwriter of securities to be
the "Beneficial Owner" of, or to "beneficially own," any securities acquired
through such person's participation in good faith in a firm commitment
underwriting until the expiration of forty (40) days after the date of such
acquisition; and provided further, however, that in no case shall an officer or
director of the Company be deemed (x) the Beneficial Owner of any securities
beneficially owned by another officer or director of the Company solely by
reason of actions undertaken by such persons in their capacity as officers or
directors of the Company or (y) the Beneficial Owner of securities held of
record by the trustee of any employee benefit plan of the Company or any
Subsidiary of the Company for the benefit of any employee of the Company or any
Subsidiary of the Company, other than the officer or director, by reason of any
influence that such officer or director may have over the voting of the
securities held in the plan.

          (d) "Business Day" shall mean any day other than a Saturday, Sunday or
a day on which banking institutions in the State of California, New York or New
Jersey are authorized or obligated by law or executive order to close.

          (e) "Close of Business" on any given date shall mean 5:00 P.M., New
York time, on such date; provided, however, that if such date is not a Business
Day it shall mean 5:00 P.M., New York time, on the next succeeding Business Day.

          (f) "Common Stock" shall mean the Common Stock, par value $0.01 per
share, of the Company, except that "Common Stock" when used with reference to
any Person other than the Company shall mean the capital stock of such Person
with the greatest voting power, or the equity securities or other equity
interest having power to control or direct the management, of such Person.

          (g) "Exchange Act" shall mean the Securities Exchange Act of 1934, as
amended to date.

          (h) "Expiration Date" shall mean the earliest of (i) the Close of
Business on the Final Expiration Date, (ii) the time at which the Rights are
redeemed as provided in Section 23 hereof, or (iii) the time at which the Board
of Directors orders the exchange of the Rights as provided in Section 24 hereof.

          (i) "Final Expiration Date" shall mean the earlier of (i) December 31,
2008, or (ii) December 31, 2006, if the Stockholder Approval has not been
received by December 31, 2006.

          (j) "Person" shall mean any individual, firm, corporation, limited
liability company, partnership, trust or other entity, and shall include any
successor (by merger or otherwise) of such entity.

                                       3
<PAGE>
          (k) "Preferred Stock" shall mean shares of Series A Junior
Participating Preferred Stock, par value $0.01 per share, of the Company, having
the rights and preferences set forth in the form of Certificate of Designation,
Preferences and Rights attached hereto as Exhibit A.

          (l) "Qualified Offer" shall mean a tender offer for all outstanding
shares of Common Stock made in the manner prescribed by Section 14(d) of the
Exchange Act and the rules and regulations promulgated thereunder which meets
all of the following requirements:

               (i) the same per share price and consideration is offered for all
shares of Common Stock in the Qualified Offer;

               (ii) the consideration is at least eighty percent (80%) cash (and
any non-cash portion is comprised of shares listed on any national securities
exchange or the Nasdaq National Market System (the "NMS"), to be adjusted to
reflect any decrease in the value of such shares prior to the consummation of
the Qualified Offer) and is to be paid upon consummation of the Qualified Offer
for all tendered or exchanged shares of Common Stock in the Qualified Offer;

               (iii) on or prior to the date such offer is commenced within the
meaning of Rule 14d-2(a) of the General Rules and Regulations under the Exchange
Act, such Person:

                    (A) has on hand cash or cash equivalents for the full amount
necessary to consummate such offer and has irrevocably committed in writing to
the Company to utilize such cash or cash equivalents for purposes of such offer
if consummated and to set apart and maintain available such cash or cash
equivalents for such purposes until the offer is consummated or withdrawn; or

                    (B) has all financing in the full amount necessary to
consummate such offer and has:

                         (1) entered into, and provided to the Company certified
copies of, definitive financing agreements (including exhibits and related
documents) for funds for such offer which, when added to the amount of cash and
cash equivalents available, committed in writing, set apart and maintained in
the same manner as described in clause (A) above, are in an amount not less than
the full amount necessary to consummate such offer, which agreements are with
one or more responsible financial institutions or other entities having the
necessary financial capacity and ability to provide such funds, and are subject
only to customary terms and conditions (which shall in no event include
conditions requiring access by such institutions to non-public information to
provided by the Company, conditions based on the of any information concerning
the Company, conditions requiring the Company to make any, warranties or
covenants in with such financing), and

                         (2) provided to the Company copies all written
materials prepared by such Person for financial institutions in connection with
into such financing agreements; provided, "the full amount necessary to
consummate such offer" in either clause (A) or (B) above shall be an sufficient
to pay for all shares of Common Stock outstanding on a fully diluted basis the
cash of the consideration pursuant to the offer the second-step transaction
required by clause (vii) below and all related expenses;

                                       4
<PAGE>
               (iv) the offering Person requests the Company to call a special
meeting of the Company's stockholders for the purpose of voting on a resolution
(i) accepting such Qualified Offer, as such Qualified Offer may be amended or
revised by the offering Person from time to time to increase the price per share
to be paid to holders of shares of Common Stock, and (ii) authorizing the
redemption of the Rights pursuant to Section 23(b)(ii) hereof, and contains a
written agreement of such Person to pay (or share with any other offering
Person) one-half of the Company's costs of such special meeting;

               (v) such offer remains open for at least sixty (60) Business Days
and at least ten (10) Business Days after the special meeting of the Company's
stockholders; provided, however, that (x) if there is any increase in the price
of such offer, such offer must remain open for at least an additional fifteen
(15) Business Days after the last such increase, (y) such offer must remain open
for at least fifteen (15) Business Days after the date that any bona fide
alternative offer is made which, in the opinion of one or more investment
banking firms designated by the Company, provides for consideration per share in
excess of that provided for in such offer, and (z) such offer must remain open
for at least fifteen (15) Business Days after the date, if any, on which such
Person reduces the per share price offered in accordance with clause (vii)(y)
below (provided, in the case of each of clauses (x), (y) and (z) above, in no
event will such offer have been outstanding for less than sixty (60) Business
Days and at least ten (10) Business Days after the special meeting of the
Company's stockholders); provided further, however, that such offer need not
remain open, as a result of this clause (v), beyond (1) the time which any other
offer satisfying the criteria for a Qualified Offer is then required to be kept
open under this clause (v), or (2) the scheduled expiration date, as such date
may be extended by public announcement on or prior to the then scheduled
expiration date, of any other tender or exchange offer for Common Stock with
respect to which the Board of Directors has agreed to redeem the Rights
immediately prior to acceptance for payment of Common Stock thereunder (unless
such other offer is terminated prior to its expiration without any Common Stock
having been purchased thereunder);

               (vi) such offer is accompanied by a written opinion, in customary
form, of a nationally recognized investment banking firm which is addressed to
the Company and the holders of Common Stock other than such Person and states
that the price to be paid to holders pursuant to the offer is fair from a
financial point of view to such holders and includes any written presentation of
such firm showing the analysis and range of values underlying such conclusions
and such written opinion and any such presentation is updated and provided to
the Company within two Business Days prior to the date such offer is
consummated;

               (vii) prior to or on the date that such offer is commenced within
the meaning of Rule 14d-2(a) of the General Rules and Regulations under the
Exchange Act, such Person makes an irrevocable written commitment to the Company
and, with respect to clause (x), to its stockholders, (x) to consummate a
transaction or transactions promptly upon the completion of such offer (and in
no event later than five (5) Business Days thereafter), whereby all Common Stock
not purchased in such offer will be acquired at the same cash price per share
paid in such offer, subject only to the condition that the Board of Directors
shall have granted any approvals required to enable such Person to consummate
such transaction or transactions following consummation of such offer without
obtaining the vote of any other stockholder, (y) that such Person will not make
any amendment to the original offer which reduces the per share price offered
(other than a reduction to reflect any dividend declared by the Company, other
than a regular quarterly dividend, after the commencement of such offer or any
material change in the capital structure of the Company initiated

                                       5
<PAGE>
by the Company after the commencement of such offer, whether by way of
reclassification, recapitalization, reorganization, repurchase or otherwise),
changes the form of consideration offered, or reduces the number of shares being
sought or which is in any other respect materially adverse to the Company's
stockholders, and (z) if the Qualified Offer is not consummated, that neither
such Person nor any of its Affiliates or Associates will make any offer for or
purchase any equity securities of the Company for a period of twelve (12) months
after the commencement of the original offer if such original offer does not
result in the tender of at least eighty five percent (85%) of the outstanding
shares of Common Stock not owned by such Person (including its Affiliates and
Associates), unless another tender offer by another party for all outstanding
Common Stock is commenced that (a) constitutes a Qualified Offer (in which
event, any new offer by such Person or of any Affiliates or Associates must be
at a price no less than that provided for in such original offer) or (b) is
approved by the Board of Directors of the Company (in which event, any new offer
by such Person or of any of its Affiliates or Associates must be at a price no
less than that provided for in such approved offer); and

               (viii) except for the requirements set forth above, and other
than usual and customary terms and conditions for regulatory and stockholder
approvals, such offer is not subject to any financing, funding or similar
condition, nor any condition relating to completion of or satisfaction with any
due diligence or similar investigation.

          (m) "Section 11(a)(ii) Event" shall mean any event described in
Section 11(a)(ii) (A), (B) or (C) hereof.

          (n) "Section 13 Event" shall mean any event described in clauses (x),
(y) or (z) of Section 13(a) hereof.

          (o) "Stock Acquisition Date" shall mean the first date of public
announcement (which, for purposes of this definition, shall include, without
limitation, a report filed pursuant to Section 13(d) under the Exchange Act) by
the Company or an Acquiring Person that an Acquiring Person has become such.

          (p) "Stockholder Approval" shall mean the approval of this Agreement
by the affirmative vote of the holders of a majority of the shares of Common
Stock of the Company present, or represented by proxy, and entitled to vote at a
meeting of the stockholders duly held in accordance with applicable law.

          (q) "Subsidiary" shall mean, with reference to any Person, any
corporation of which an amount of voting securities sufficient to elect at least
a majority of the directors of such corporation is beneficially owned, directly
or indirectly, by such Person, or otherwise controlled by such Person.

          (r) "Triggering Event" shall mean any Section 11(a)(ii) Event or any
Section 13 Event.

     SECTION 2. APPOINTMENT OF RIGHTS AGENT. The Company hereby appoints the
Rights Agent to act as agent for the Company in accordance with the terms and
conditions hereof, and the Rights Agent hereby accepts such appointment. The
Company may from time to time appoint such

                                       6
<PAGE>
co-Rights Agents as it may deem necessary or desirable. The Rights Agent shall
have no duty to supervise, and in no event shall be liable for, the acts or
omissions of any such co-Rights Agent.

     SECTION 3. ISSUANCE OF RIGHTS CERTIFICATES.

          (a) Until the earlier of (i) the Close of Business on the tenth day
(or such later date as may be determined by action of a majority of the Board of
Directors) after the Stock Acquisition Date (or, if the tenth day after the
Stock Acquisition Date occurs before the Record Date, the Close of Business on
the Record Date), or (ii) the Close of Business on the tenth Business Day (or
such later date as may be determined by action of a majority of the Board of
Directors then in office) after the date that a tender or exchange offer by any
Person (other than the Company, any Subsidiary of the Company, any employee
benefit plan of the Company or of any Subsidiary of the Company, or any Person
or entity organized, appointed or established by the Company for or pursuant to
the terms of any such employee benefit plan) is commenced within the meaning of
Rule 14d-2(a) of the General Rules and Regulations under the Exchange Act, if
upon consummation thereof, such Person would be the Beneficial Owner of fifteen
percent (15%) or more of the shares of Common Stock then outstanding (the
earlier of (i) and (ii) being herein referred to as the "Distribution Date"),
(x) the Rights will be evidenced (subject to the provisions of paragraph (b) of
this Section 3) by the certificates for the Common Stock registered in the names
of the holders of the Common Stock (which certificates for Common Stock shall be
deemed also to be certificates for Rights) and not by separate certificates, and
(y) the Rights will be transferable only in connection with the transfer of the
underlying shares of Common Stock (including a transfer to the Company). The
Company shall promptly notify the Rights Agent in writing upon the occurrence of
the Distribution Date and, if such notification is given orally, the Company
shall confirm in writing on or prior to the Business Day next following. Until
such notice is received by the Rights Agent, the Rights Agent may presume
conclusively for all purposes that the Distribution Date has not occurred. As
soon as practicable after the Distribution Date, and receipt by the Rights Agent
of notice of such occurrence, the Rights Agent, if requested and provided with
all necessary information and documentation, will send by first-class, insured,
postage prepaid mail, to each record holder of the Common Stock as of the Close
of Business on the Distribution Date, at the address of such holder shown on the
records of the Company, one or more rights certificates, in substantially the
form of Exhibit B hereto (the "Rights Certificates"), duly executed and
countersigned in the manner provided for in Section 5(a) hereof, evidencing one
Right for each share of Common Stock so held, subject to adjustment as provided
herein. In the event that an adjustment in the number of Rights per share of
Common Stock has been made pursuant to Section 11(p) hereof, at the time of
distribution of the Rights Certificates, the Company shall make the necessary
and appropriate rounding adjustments (in accordance with Section 14(a) hereof)
so that Rights Certificates representing only whole numbers of Rights are
distributed and cash is paid in lieu of any fractional Rights. As of and after
the Distribution Date, the Rights will be evidenced solely by such Rights
Certificates and may be transferred by the transfer of the Rights Certificates
as permitted hereby, separately and apart from any transfer of one or more
shares of Common Stock, and the holders of such Rights Certificates as listed in
the records of the Company or any transfer agent or registrar for the Rights
shall be the record holders thereof.

          (b) As promptly as practicable following the Record Date, the Company
will send a copy of a Summary of Rights, in substantially the form attached
hereto as Exhibit C (the "Summary of Rights"), by first-class, postage prepaid
mail, to each record holder of the Common Stock as of the Close of Business on
the Record Date, at the address of such holder shown on the

                                       7
<PAGE>
records of the Company. With respect to certificates for the Common Stock
outstanding as of the Record Date, until the Distribution Date, the Rights will
be evidenced by such certificates for the Common Stock and the registered
holders of the Common Stock shall also be the registered holders of the
associated Rights. Until the earlier of the Distribution Date or the Expiration
Date, the transfer of any certificates representing shares of Common Stock in
respect of which Rights have been issued shall also constitute the transfer of
the Rights associated with such shares of Common Stock.

          (c) Unless the Board of Directors by resolution adopted at or before
the time of the issuance (including pursuant to the exercise of rights under the
Company's employee benefit plans) of any Common Stock specifies to the contrary,
Rights shall be issued in respect of all shares of Common Stock which are issued
after the Record Date but prior to the earlier of the Distribution Date or the
Expiration Date. Certificates representing such shares of Common Stock shall
also be deemed to be certificates for Rights, and shall bear the following
legend:

          This certificate also evidences and entitles the holder hereof to
     certain Rights as set forth in the Rights Agreement between CKE
     Restaurants, Inc., a Delaware corporation (the "Company") and Mellon
     Investor Services LLC, as Rights Agent (the "Rights Agent"), dated as of
     October 10, 2005 (the "Rights Agreement"), the terms of which are hereby
     incorporated herein by reference and a copy of which is on file at the
     principal offices of the Company. Under certain circumstances, as set forth
     in the Rights Agreement, such Rights will be evidenced by separate
     certificates and will no longer be evidenced by this certificate. The
     Company will mail to the holder of this certificate a copy of the Rights
     Agreement, as in effect on the date of mailing, without charge promptly
     after receipt of a written request therefor. Under certain circumstances
     set forth in the Rights Agreement, Rights issued to, or held by, any Person
     who is, was or becomes an Acquiring Person or any Affiliate or Associate
     thereof (as such terms are defined in the Rights Agreement), whether
     currently held by or on behalf of such Person or by any subsequent holder,
     may become null and void.

With respect to such certificates containing the foregoing legend, until the
earlier of (i) the Distribution Date or (ii) the Expiration Date, the Rights
associated with the Common Stock represented by such certificates shall be
evidenced by such certificates alone and registered holders of Common Stock also
shall be the registered holders of the associated Rights, and the transfer of
any of such certificates shall also constitute the transfer of the Rights
associated with the Common Stock represented by such certificates. In the event
that the Company purchases or acquires any Common Stock after the Record Date
but prior to the Distribution Date, any Rights associated with such Common Stock
shall be deemed cancelled and retired so that the Company shall not be entitled
to exercise any Rights associated with the Common Stock which are no longer
outstanding.

     SECTION 4. FORM OF RIGHTS CERTIFICATES.

          (a) The Rights Certificates (and the forms of election to purchase and
of assignment to be printed on the reverse thereof) shall each be substantially
in the form set forth in Exhibit B hereto and may have such marks of
identification or designation and such legends, summaries or endorsements
printed thereon as the Company may deem appropriate which are not inconsistent
with the provisions of this Agreement and which do not affect the rights, duties
and

                                       8
<PAGE>
responsibilities of the Rights Agent, or as may be required to comply with any
applicable law or with any rule or regulation made pursuant thereto or with any
rule or regulation of any stock exchange on which the Rights may from time to
time be listed, or to conform to usage. Subject to the provisions of Section 11
and Section 22 hereof, the Rights Certificates, whenever distributed, shall be
dated as of the Record Date and on their face shall entitle the holders thereof
to purchase such number of one one-hundredths of a share of Preferred Stock as
shall be set forth therein at the price set forth therein (such exercise price
per one one-hundredths of a share, the "Purchase Price"), but the amount and
type of securities purchasable upon the exercise of each Right and the Purchase
Price thereof shall be subject to adjustment as provided herein.

          (b) Any Rights Certificate issued pursuant to Section 3(a) or Section
22 hereof that represents Rights beneficially owned by: (i) an Acquiring Person
or any Associate or Affiliate of an Acquiring Person, (ii) a transferee of an
Acquiring Person (or of any such Associate or Affiliate) who becomes a
transferee after the Acquiring Person becomes such, or (iii) a transferee of an
Acquiring Person (or of any such Associate or Affiliate) who becomes a
transferee prior to or concurrently with the Acquiring Person becoming such and
receives such Rights pursuant to either (A) a transfer (whether or not for
consideration) from the Acquiring Person to holders of equity interests in such
Acquiring Person or to any Person with whom such Acquiring Person has any
continuing agreement, arrangement or understanding regarding the transferred
Rights or (B) a transfer which the Board of Directors of the Company has
determined is part of a plan, arrangement or understanding which has as a
primary purpose or effect avoidance of Section 7(e) hereof, and any Rights
Certificate issued pursuant to Section 6 or Section 11 hereof upon transfer,
exchange, replacement or adjustment of any other Rights Certificate referred to
in this sentence, shall contain (to the extent feasible) the following legend:

          The Rights represented by this Rights Certificate are or were
     beneficially owned by a Person who was or became an Acquiring Person or an
     Affiliate or Associate of an Acquiring Person (as such terms are defined in
     the Rights Agreement). Accordingly, this Rights Certificate and the Rights
     represented hereby may become null and void in the circumstances specified
     in Section 7(e) of such Agreement.

     SECTION 5. COUNTERSIGNATURE AND REGISTRATION.

          (a) The Rights Certificates shall be executed on behalf of the Company
by its Chairman of the Board, its President or any Vice President, either
manually or by facsimile signature, and shall have affixed thereto the Company's
seal or a facsimile thereof which shall be attested by the Secretary or an
Assistant Secretary of the Company, either manually or by facsimile signature.
The Rights Certificates shall be manually countersigned by the Rights Agent and
shall not be valid for any purpose unless so countersigned. In case any officer
of the Company who shall have signed any of the Rights Certificates shall cease
to be such officer of the Company before countersignature by the Rights Agent
and issuance and delivery by the Company, such Rights Certificates,
nevertheless, may be countersigned by the Rights Agent and issued and delivered
by the Company with the same force and effect as though the Person who signed
such Rights Certificates had not ceased to be such officer of the Company; and
any Rights Certificates may be signed on behalf of the Company by any Person
who, at the actual date of the execution of such Rights Certificate, shall be a
proper officer of the Company to sign such Rights Certificate, although at the
date of the execution of this Rights Agreement any such Person was not such an
officer.

                                       9
<PAGE>
          (b) Following the Distribution Date, and receipt by the Rights Agent
of notice of such occurrence, and of all other necessary information and
documentation, as provided in Section 3(a) hereof, the Rights Agent will keep or
cause to be kept, at its office or offices designated as the appropriate place
for surrender of Rights Certificates upon exercise or transfer, books for
registration and transfer of the Rights Certificates issued hereunder. Such
books shall show the names and addresses of the respective holders of the Rights
Certificates, the number of Rights evidenced on its face by each of the Rights
Certificates, the Rights Certificate number and the date of each of the Rights
Certificates.

     SECTION 6. TRANSFER, SPLIT UP, COMBINATION AND EXCHANGE OF RIGHTS
CERTIFICATES; MUTILATED, DESTROYED, LOST OR STOLEN RIGHTS CERTIFICATES.

          (a) Subject to the provisions of Section 4(b), Section 7(e), Section
14 and Section 24 hereof, at any time after the Close of Business on the
Distribution Date, and at or prior to the Close of Business on the Expiration
Date, any Rights Certificate or Certificates may be transferred, split up,
combined or exchanged for another Rights Certificate or Certificates, entitling
the registered holder to purchase a like number of one one-hundredths of a share
of Preferred Stock (or following a Triggering Event, Common Stock, other
securities, cash or other assets, as the case may be) as the Rights Certificate
or Certificates surrendered then entitled such holder (or former holder in the
case of a transfer) to purchase. Any registered holder desiring to transfer,
split up, combine or exchange any Rights Certificate or Certificates shall make
such request in writing delivered to the Rights Agent, and shall surrender the
Rights Certificate or Certificates to be transferred, split up, combined or
exchanged at the principal office or offices of the Rights Agent designated for
such purpose. The Rights Certificates shall be transferable only on the registry
books of the Rights Agent. Neither the Rights Agent nor the Company shall be
obligated to take any action whatsoever with respect to the transfer of any such
surrendered Rights Certificate until the registered holder shall have completed
and signed the certificate contained in the form of assignment on the reverse
side of such Rights Certificate and shall have provided such additional evidence
of the identity of the Beneficial Owner (or former Beneficial Owner) thereof and
of the Rights evidenced thereby or of the Affiliates or Associates of such
Beneficial Owner (or former Beneficial Owner) as the Company or the Rights Agent
shall reasonably request. Thereupon the Rights Agent shall, subject to Section
4(b), Section 7(e), Section 14 and Section 24 hereof, countersign and deliver to
the Person entitled thereto a Rights Certificate or Rights Certificates, as the
case may be, as so requested. The Company may require payment of a sum
sufficient to cover any tax or governmental charge that may be imposed in
connection with any transfer, split up, combination or exchange of Rights
Certificates, registered in such name or names as may be designated by the
surrendering registered holder. If and to the extent the Company does require
payment of any such taxes or governmental charges, the Rights Agent shall not
deliver the Rights Certificate(s) unless and until it is satisfied that all such
payments have been made, and the Rights Agent shall promptly forward any such
sum collected by it to the Company or to such persons as the Company may specify
by written notice.

          (b) Upon receipt by the Company and the Rights Agent of evidence
reasonably satisfactory to them of the loss, theft, destruction or mutilation of
a Rights Certificate, and, in case of loss, theft or destruction, of indemnity
or security reasonably satisfactory to them, and reimbursement to the Company
and the Rights Agent of all reasonable expenses incidental thereto, and upon
surrender to the Rights Agent and cancellation of the Rights Certificate if
mutilated, the Company will execute and deliver a new Rights Certificate of like
tenor to the Rights Agent for

                                       10
<PAGE>
countersignature and delivery to the registered owner in lieu of the Rights
Certificate so lost, stolen, destroyed or mutilated.

     SECTION 7. EXERCISE OF RIGHTS; PURCHASE PRICE; EXPIRATION DATE OF RIGHTS.

          (a) Subject to Section 7(e) hereof, the registered holder of any
Rights Certificate may exercise the Rights evidenced thereby (except as
otherwise provided herein including, without limitation, the restrictions on
exercisability set forth in Section 9(c), Section 11(a)(iii) and Section 23(a)
hereof) in whole or in part at any time after the Distribution Date upon
surrender of the Rights Certificate, with the form of election to purchase and
the certificate on the reverse side thereof duly and properly executed, to the
Rights Agent at the office or offices of the Rights Agent designated for such
purpose, together with payment of the aggregate Purchase Price with respect to
the total number of one one-hundredths of a share of Preferred Stock (or other
securities or property, as the case may be) as to which such surrendered Rights
are then exercisable, and an amount equal to any applicable transfer tax or
charge required to be paid under Section 9(e) hereof, at or prior to the
Expiration Date. Except for those provisions herein which expressly survive the
termination of this Agreement, this Agreement shall terminate at such time as
the Rights are no longer exercisable hereunder.

          (b) The Purchase Price for each one one-hundredths of a share of
Preferred Stock pursuant to the exercise of a Right shall initially be
Twenty-two Dollars ($22.00), and shall be subject to adjustment from time to
time as provided in Section 11 hereof and shall be payable in accordance with
paragraph (c) below.

          (c) Upon receipt of a Rights Certificate representing exercisable
Rights, with the form of election to purchase and the certificate duly and
properly executed, accompanied by payment, with respect to each Right so
exercised, of the Purchase Price per one one-hundredths of a share of Preferred
Stock (or other shares, securities or property, as the case may be) to be
purchased as set forth below and an amount equal to any applicable transfer tax
or charge required to be paid under Section 9(e) hereof, the Rights Agent shall,
subject to Section 20(k) hereof, thereupon promptly (i) (A) requisition from any
transfer agent of the shares of Preferred Stock (or make available, if the
Rights Agent is the transfer agent for such shares) certificates for the total
number of one one-hundredths of a share of Preferred Stock to be purchased and
the Company hereby irrevocably authorizes its transfer agent to comply with all
such requests, or (B) if the Company shall have elected to deposit the total
number of shares of Preferred Stock issuable upon exercise of the Rights
hereunder with a depositary agent, requisition from the depositary agent
depositary receipts representing such number of one one-hundredths of a share of
Preferred Stock as are to be purchased (in which case certificates for the
shares of Preferred Stock represented by such receipts shall be deposited by the
transfer agent with the depositary agent) and the Company will direct the
depositary agent to comply with such request, (ii) when appropriate, requisition
from the Company the amount of cash, if any, to be paid in lieu of fractional
shares in accordance with Section 11 hereof, (iii) after receipt of such
certificates or depositary receipts, cause the same to be delivered to or upon
the order of the registered holder of such Rights Certificate, registered in
such name or names as may be designated by such holder, and (iv) when
appropriate, after receipt thereof, deliver such cash, if any, to or upon the
order of the registered holder of such Rights Certificate. The payment of the
Purchase Price (as such amount may be reduced pursuant to Section 11(a)(iii)
hereof) and an amount equal to any applicable transfer tax or charge required to
be paid under Section 9(e) hereof, may be made (x) in cash or by certified bank
check, cashier's check, bank draft or money order payable to the

                                       11
<PAGE>
order of the Company, or (y) by delivery of a certificate or certificates (with
appropriate stock powers executed in blank attached thereto) evidencing a number
of shares of Common Stock equal to the sum of the then Purchase Price and an
amount equal to any applicable transfer tax or charge required to be paid under
Section 9(e) hereof, divided by the closing market price (as determined pursuant
to Section 11(d) hereof) per share of Common Stock on the Trading Date
immediately preceding the date of such exercise. In the event that the Company
is obligated to issue other securities (including Common Stock) of the Company,
pay cash and/or distribute other property pursuant to Section 11(a) hereof, the
Company will make all arrangements necessary so that such other securities, cash
and/or other property are available for distribution by the Rights Agent, if and
when appropriate.

          (d) In case the registered holder of any Rights Certificate shall
exercise less than all the Rights evidenced thereby, a new Rights Certificate
evidencing Rights equivalent to the Rights remaining unexercised shall be issued
by the Rights Agent and delivered to, or upon the order of, the registered
holder of such Rights Certificate, registered in such name or names as may be
designated by such holder, subject to the provisions of Section 14 hereof.

          (e) Notwithstanding anything in this Agreement to the contrary, from
and after the first occurrence of a Triggering Event, any Rights beneficially
owned by (i) an Acquiring Person or an Associate or Affiliate of an Acquiring
Person, (ii) a transferee of an Acquiring Person (or of any such Associate or
Affiliate) who becomes a transferee after the Acquiring Person becomes such (a
"Post Transferee"), or (iii) a transferee of an Acquiring Person (or of any such
Associate or Affiliate) who becomes a transferee prior to or concurrently with
the Acquiring Person becoming such and receives such Rights pursuant to either
(A) a transfer (whether or not for consideration) from the Acquiring Person to
holders of equity interests in such Acquiring Person or to any Person with whom
the Acquiring Person had any continuing agreement, arrangement or understanding
regarding the transferred Rights or (B) a transfer which the Board of Directors
of the Company has determined is part of a plan, arrangement or understanding
which has as a primary purpose or effect the avoidance of this Section 7(e) (a
"Prior Transferee"), or (iv) any subsequent transferee receiving transferred
Rights from a Post Transferee or a Prior Transferee, either directly or through
one or more intermediate transferees, shall become null and void without any
further action and no holder of such Rights shall have any rights whatsoever
with respect to such Rights, whether under any provision of this Agreement or
otherwise. The Company shall use all reasonable efforts to insure that the
provisions of this Section 7(e) and Section 4(b) hereof are complied with, but
shall have no liability to any holder of Rights Certificates or other person as
a result of its failure to make any determinations with respect to an Acquiring
Person or its Affiliates, Associates or transferees hereunder.

          (f) Notwithstanding anything in this Agreement to the contrary,
neither the Rights Agent nor the Company shall be obligated to undertake any
action with respect to a registered holder of Rights or other securities upon
the occurrence of any purported exercise as set forth in this Section 7 unless
such registered holder shall have (i) properly completed and signed the
certificate contained in the form of election to purchase set forth on the
reverse side of the Rights Certificate surrendered for such exercise, and (ii)
provided such additional evidence of the identity of the Beneficial Owner (or
former Beneficial Owner) thereof and of the Rights evidenced thereby or of the
Affiliates or Associates of such Beneficial Owner (or former Beneficial Owner)
as the Company or the Rights Agent shall reasonably request.

                                       12
<PAGE>
     SECTION 8. CANCELLATION AND DESTRUCTION OF RIGHTS CERTIFICATES. All Rights
Certificates surrendered for the purpose of exercise, transfer, split up,
combination or exchange shall, if surrendered to the Company or any of its
agents, be delivered to the Rights Agent for cancellation or in cancelled form,
or, if surrendered to the Rights Agent, shall be cancelled by it, and no Rights
Certificates shall be issued in lieu thereof except as expressly permitted by
any of the provisions of this Agreement. The Company shall deliver to the Rights
Agent for cancellation and retirement, and the Rights Agent shall so cancel and
retire, any other Rights Certificate purchased or acquired by the Company
otherwise than upon the exercise thereof. The Rights Agent shall deliver all
cancelled Rights Certificates to the Company, or shall, at the written request
of the Company, destroy such cancelled Rights Certificates, and in such case
shall deliver a certificate of destruction thereof to the Company.

     SECTION 9. RESERVATION AND AVAILABILITY OF CAPITAL STOCK.

          (a) The Company covenants and agrees that it will cause to be reserved
and kept available out of its authorized and unissued shares of Preferred Stock
(and, following the occurrence of a Triggering Event, out of its authorized and
unissued shares of Common Stock and/or other securities or out of its authorized
and issued shares held in its treasury), the number of shares of Preferred Stock
(and, following the occurrence of a Triggering Event, Common Stock and/or other
securities) that, as provided in this Agreement including Section 11(a)(iii)
hereof, will be sufficient to permit the exercise in full of all outstanding
Rights.

          (b) So long as the shares of Preferred Stock (and following the
occurrence of a Triggering Event, Common Stock and/or other securities) issuable
and deliverable upon the exercise of the Rights may be listed on any national
securities exchange or the NMS, the Company shall use its best efforts to cause,
from and after such time as the Rights become exercisable, all shares reserved
for such issuance to be listed on such exchange or the NMS upon official notice
of issuance upon such exercise.

          (c) The Company shall use its best efforts to (i) file, as soon as
practicable following the earliest date after the first occurrence of a Section
11(a)(ii) Event on which the consideration to be delivered by the Company upon
exercise of the Rights has been determined in accordance with Section 11(a)(iii)
hereof, or as soon as is required by law following the Distribution Date, as the
case may be, a registration statement under the Securities Act of 1933, as
amended (the "Act"), with respect to the securities purchasable upon exercise of
the Rights on an appropriate form, (ii) cause such registration statement to
become effective as soon as practicable after such filing, and (iii) cause such
registration statement to remain effective (with a prospectus at all times
meeting the requirements of the Act) until the earlier of (A) the date as of
which the Rights are no longer exercisable for such securities, and (B) the date
of the expiration of the Rights. The Company will also take such action as may
be appropriate under, or to ensure compliance with, the securities or "blue sky"
laws of the various states in connection with the exercisability of the Rights.
The Company may temporarily suspend, for a period of time not to exceed ninety
(90) days after the date set forth in clause (i) of the first sentence of this
Section 9(c), the exercisability of the Rights in order to prepare and file such
registration statement and permit it to become effective. Upon any such
suspension, the Company shall issue a public announcement stating that the
exercisability of the Rights has been temporarily suspended, as well as a public
announcement at such time as the suspension is no longer in effect. The Company
shall notify the Rights Agent in writing whenever it makes a public announcement
pursuant to this Section 9(c) and give the Rights Agent a copy of such
announcement(s). Notwithstanding any provision of this Agreement to the
contrary, the Rights shall

                                       13
<PAGE>
not be exercisable in any jurisdiction unless the requisite qualification in
such jurisdiction shall have been obtained and until a registration statement
(if required) has been declared effective.

          (d) The Company covenants and agrees that it will take all such action
as may be necessary to ensure that all one one-hundredths of a share of
Preferred Stock (and, following the occurrence of a Triggering Event, Common
Stock and/or other securities) delivered upon exercise of Rights shall, at the
time of delivery of the certificates for such shares (subject to payment of the
Purchase Price), be duly and validly authorized and issued and fully paid and
nonassessable.

          (e) The Company further covenants and agrees that it will pay when due
and payable any and all federal and state transfer taxes and charges which may
be payable in respect of the issuance or delivery of the Rights Certificates and
of any certificates for shares of Preferred Stock (or Common Stock and/or other
securities, as the case may be) upon the exercise of Rights. The Company shall
not, however, be required to pay any transfer tax or charge which may be payable
in respect of any transfer or delivery of Rights Certificates to a Person other
than, or the issuance or delivery of a number of one one-hundredths of a share
of Preferred Stock (or Common Stock and/or other securities, as the case may be)
in respect of a name other than that of, the registered holder of the Rights
Certificates evidencing Rights surrendered for exercise or to issue or deliver
any certificates for a number of one one-hundredths of a share of Preferred
Stock (or Common Stock and/or other securities, as the case may be) in a name
other than that of the registered holder upon the exercise of any Rights until
such tax shall have been paid (any such tax being payable by the holder of such
Rights Certificate at the time of surrender) or until it has been established to
the Company's satisfaction that no such tax is due.

     SECTION 10. PREFERRED STOCK RECORD DATE. Each Person in whose name any
certificate for a number of one one-hundredths of a share of Preferred Stock (or
Common Stock and/or other securities, as the case may be) is issued upon the
exercise of Rights shall for all purposes be deemed to have become the holder of
record of such fractional shares of Preferred Stock (or Common Stock and/or
other securities, as the case may be) represented thereby on, and such
certificate shall be dated, the date upon which the Rights Certificate
evidencing such Rights was duly surrendered and payment of the Purchase Price
(and all applicable transfer taxes or charges) was duly made; provided, however,
that if the date of such surrender and payment is a date upon which the
Preferred Stock (or Common Stock and/or other securities, as the case may be)
transfer books of the Company are closed, such Person shall be deemed to have
become the record holder of such shares (fractional or otherwise) on, and such
certificate shall be dated, the next succeeding Business Day on which the
Preferred Stock (or Common Stock and/or other securities, as the case may be)
transfer books of the Company are open. Prior to the exercise of the Rights
evidenced thereby, the holder of a Rights Certificate shall not be entitled to
any rights of a stockholder of the Company with respect to shares for which the
Rights shall be exercisable, including, without limitation, the right to vote,
to receive dividends or other distributions or to exercise any preemptive
rights, and shall not be entitled to receive any notice of any proceedings of
the Company, except as provided herein.

     SECTION 11. ADJUSTMENT OF PURCHASE PRICE, NUMBER AND KIND OF SHARES OR
NUMBER OF RIGHTS. The Purchase Price, the number and kind of shares covered by
each Right and the number of Rights outstanding are subject to adjustment from
time to time as provided in this Section 11.

          (a) (i) In the event the Company shall at any time after the date of
this Agreement (A) declare a dividend on the Preferred Stock payable in shares
of Preferred Stock,

                                       14
<PAGE>
(B) subdivide the outstanding Preferred Stock, (C) combine the outstanding
Preferred Stock into a smaller number of shares, or (D) issue any shares of its
capital stock in a reclassification of the Preferred Stock (including any such
reclassification in connection with a consolidation or merger in which the
Company is the continuing or surviving corporation), except as otherwise
provided in this Section 11(a) or in Section 7 hereof, the Purchase Price in
effect at the time of the record date for such dividend or of the effective date
of such subdivision, combination or reclassification, and the number and kind of
shares of Preferred Stock or capital stock, as the case may be, issuable on such
date, shall be proportionately adjusted so that the holder of any Right
exercised after such time shall be entitled to receive, upon payment of the
Purchase Price then in effect, the aggregate number and kind of shares of
Preferred Stock or capital stock, as the case may be, which, if such Right had
been exercised immediately prior to such date and at a time when the Preferred
Stock transfer books of the Company were open, such holder would have owned upon
such exercise and been entitled to receive by virtue of such dividend,
subdivision, combination or reclassification. If an event occurs which would
require an adjustment under both this Section 11(a)(i) and Section 11(a)(ii)
hereof, the adjustment provided for in this Section 11(a)(i) shall be in
addition to, and shall be made prior to, any adjustment required pursuant to
Section 11(a)(ii) hereof.

               (ii) In the event:

                    (A) any Acquiring Person or any Associate or Affiliate of
any Acquiring Person, at any time after the date of this Agreement, directly or
indirectly, (1) shall merge into the Company or otherwise combine with the
Company and the Company shall be the continuing or surviving corporation of such
merger or combination and the Common Stock of the Company shall remain
outstanding and unchanged, (2) shall, in one transaction or a series of
transactions, transfer any assets to the Company or to any of its Subsidiaries
in exchange (in whole or in part) for shares of Common Stock, for shares of
other equity securities of the Company, or for securities exercisable for or
convertible into shares of equity securities of the Company (Common Stock or
otherwise) or otherwise obtain from the Company, with or without consideration,
any additional shares of such equity securities or securities exercisable for or
convertible into shares of such equity securities (other than pursuant to a pro
rata distribution to all holders of Common Stock), (3) shall sell, purchase,
lease, exchange, mortgage, pledge, transfer or otherwise acquire or dispose of,
in the transaction or a series of transactions, to, from or with (as the case
may be) the Company or any of its Subsidiaries, assets on terms and conditions
less favorable to Company than the Company would be able to obtain in arm's
length negotiation with an unaffiliated third party, other than pursuant to a
transaction set forth in Section 13(a) hereof, (4) shall sell, purchase, lease,
exchange, mortgage, pledge, transfer or otherwise acquire or dispose of in one
transaction or a series of transactions, to, from or with (as the case may be)
the Company or any of the Company's Subsidiaries (other than incidental to the
lines of business, if any, engaged in as of the date hereof between the Company
and such Acquiring Person or Associate or Affiliate) assets having an aggregate
fair market value of more than $5,000,000, other than pursuant to a transaction
set forth in Section 13(a) hereof, (5) shall receive any compensation from the
Company or any of the Company's Subsidiaries other than compensation for full
time employment as a regular employee at rates in accordance with the Company's
(or its Subsidiaries') past practices, or (6) shall receive the benefit,
directly or indirectly (except proportionately as a stockholder and except if
resulting from a requirement of law or governmental regulation), of any loans,
advances, guarantees, pledges or other financial assistance or any tax credits
or other tax advantage provided by the Company or any of its Subsidiaries, or

                                       15
<PAGE>
                    (B) any Person shall become an Acquiring Person, other than
pursuant to any transaction set forth in Section 13(a) hereof, or

                    (C) during such time as there is an Acquiring Person, there
shall be any reclassification of securities (including any reverse stock split),
or recapitalization of the Company, or any merger or consolidation of the
Company with any of its Subsidiaries or any other transaction or series of
transactions involving the Company or any of its Subsidiaries, other than a
transaction or transactions to which the provisions of Section 13(a) apply
(whether or not with or into or otherwise involving an Acquiring Person) which
has the effect, directly or indirectly, of increasing by more than one percent
(1%) the proportionate share of the outstanding shares of any class of equity
securities of the Company or any of its Subsidiaries which is directly or
indirectly beneficially owned by any Acquiring Person or any Associate or
Affiliate of any Acquiring Person, then, promptly following ten (10) days after
the date of the occurrence of an event described in Section 11(a)(ii)(B) hereof
and promptly following the occurrence of any event described in Section
11(a)(ii)(A) or (C) hereof, proper provision shall be made so that each holder
of a Right (except as provided below and in Section 7(e) hereof) shall
thereafter have the right to receive, upon exercise thereof at the then current
Purchase Price in accordance with the terms of this Agreement, in lieu of shares
of Preferred Stock, such number of shares of Common Stock of the Company as
shall equal the result obtained by (x) multiplying the then current Purchase
Price by the then number of one one-hundredths of a share of Preferred Stock for
which a Right was exercisable immediately prior to the first occurrence of a
Section 11(a)(ii) Event, and dividing that product (which, following such first
occurrence, shall thereafter be referred to as the "Purchase Price" for each
Right and for all purposes of this Agreement) by (y) fifty percent (50%) of the
current market price (determined pursuant to Section 11(d) hereof) per share of
Common Stock on the date of such first occurrence (such number of shares, the
"Adjustment Shares").

               (iii) In the event that the number of shares of Common Stock
which are authorized by the Company's charter but not outstanding or reserved
for issuance for purposes other than upon exercise of the Rights are not
sufficient to permit the exercise in full of the Rights in accordance with the
foregoing subparagraph (ii) of this Section 11(a), the Company shall: (A)
determine the excess of (1) the value of the Adjustment Shares issuable upon the
exercise of a Right (the "Current Value") over (2) the Purchase Price (such
excess, the "Spread"), and (B) with respect to each Right, make adequate
provision to substitute for the Adjustment Shares, upon payment of the
applicable Purchase Price, (1) cash, (2) a reduction in the Purchase Price, (3)
Common Stock or other equity securities of the Company (including, without
limitation, shares, or units of shares, of preferred stock which the Board of
Directors of the Company has deemed to have the same value as shares of Common
Stock (such shares of preferred stock, "common stock equivalents")), (4) debt
securities of the Company, (5) other assets, or (6) any combination of the
foregoing, having an aggregate value equal to the Current Value, where such
aggregate value has been determined by the Board of Directors of the Company
based upon the advice of a nationally recognized investment banking firm
selected by the Board of Directors of the Company; provided, however, if the
Company shall not have made adequate provision to deliver value pursuant to
clause (B) above within thirty (30) days following the later of (x) the first
occurrence of a Section 11(a)(ii) Event and (y) the date on which the Company's
right of redemption pursuant to Section 23(a) expires (the later of (x) and (y)
being referred to herein as the "Section 11(a)(ii) Trigger Date"), then the
Company shall be obligated to deliver, upon the surrender for exercise of a
Right and without requiring payment of the Purchase Price, shares of Common
Stock (to the extent available) and then,

                                       16
<PAGE>
if necessary, cash, which in the aggregate are equal to the Spread. If the Board
of Directors of the Company shall determine in good faith that it is likely that
sufficient additional shares of Common Stock could be authorized for issuance
upon exercise in full of the Rights, the thirty (30) day period set forth above
may be extended to the extent necessary, but not more than ninety (90) days
following the first occurrence of a Section 11(a)(ii) Trigger Date, in order
that the Company may seek stockholder approval for the authorization of such
additional shares (such period, as it may be extended, the "Substitution
Period"). To the extent that the Company determines that some action need be
taken pursuant to the first and/or second sentences of this Section 11(a)(iii),
the Company (x) shall provide, subject to Section 7(e) hereof, that such action
shall apply uniformly to all outstanding Rights, and (y) may suspend the
exercisability of the Rights until the expiration of the Substitution Period in
order to seek any authorization of additional shares and/or to decide the
appropriate form of distribution to be made pursuant to such first sentence and
to determine the value thereof. In the event of any such suspension, the Company
shall issue a public announcement stating that the exercisability of the Rights
has been temporarily suspended, as well as a public announcement at such time as
the suspension is no longer in effect. For purposes of this Section 11(a)(iii),
the value of the Common Stock shall be the current market price (as determined
pursuant to Section 11(d) hereof) per share of the Common Stock on the date of
the first occurrence of a Section 11(a)(ii) Trigger Date and the value of any
"common stock equivalent" shall be deemed to have the same value as the Common
Stock on such date.

          (b) In case the Company shall fix a record date for the issuance of
rights, options or warrants to all holders of Preferred Stock entitling them to
subscribe for or purchase (for a period expiring within forty-five (45) calendar
days after such record date) Preferred Stock (or shares having the same rights,
privileges and preferences as the shares of Preferred Stock ("equivalent
preferred stock")) or securities convertible into Preferred Stock or equivalent
preferred stock at a price per share of Preferred Stock or per share of
equivalent preferred stock (or having a conversion price per share, if a
security convertible into Preferred Stock or equivalent preferred stock) less
than the current market price (as determined pursuant to Section 11(d) hereof)
per share of Preferred Stock on such record date, the Purchase Price to be in
effect after such record date shall be determined by multiplying the Purchase
Price in effect immediately prior to such record date by a fraction, the
numerator of which shall be the number of shares of Preferred Stock outstanding
on such record date, plus the number of shares of Preferred Stock which the
aggregate offering price of the total number of shares of Preferred Stock and/or
equivalent preferred stock so to be offered (and/or the aggregate initial
conversion price of the convertible securities so to be offered) would purchase
at such current market price, and the denominator of which shall be the number
of shares of Preferred Stock outstanding on such record date, plus the number of
additional shares of Preferred Stock and/or equivalent preferred stock to be
offered for subscription or purchase (or into which the convertible securities
so to be offered are initially convertible); provided, however, that in no event
shall the consideration to be paid upon the exercise of one Right be less than
the aggregate par value of the shares of capital stock of the Company issuable
upon the exercise of one Right. In case such subscription price may be paid by
delivery of consideration part or all of which may be in a form other than cash,
the value of such consideration shall be as determined in good faith by the
Board of Directors of the Company, whose determination shall be described in a
statement filed with the Rights Agent and shall be binding on the Rights Agent
and the holders of the Rights. Shares of Preferred Stock owned by or held for
the account of the Company shall not be deemed outstanding for the purpose of
any such computation. Such adjustment shall be made successively whenever such a
record date is fixed, and in the event that such rights or warrants are not so
issued, the

                                       17
<PAGE>
Purchase Price shall be adjusted to be the Purchase Price which would then be in
effect if such record date had not been fixed.

          (c) In case the Company shall fix a record date for a distribution to
all holders of Preferred Stock (including any such distribution made in
connection with a consolidation or merger in which the Company is the continuing
corporation) of evidences of indebtedness, cash (other than a regular cash
dividend out of the earnings or retained earnings of the Company), assets (other
than a dividend payable in Preferred Stock, but including any dividend payable
in stock other than Preferred Stock) or subscription rights or warrants
(excluding those referred to in Section 11(b) hereof), the Purchase Price to be
in effect after such record date shall be determined by multiplying the Purchase
Price in effect immediately prior to such record date by a fraction, the
numerator of which shall be the current market price (as determined pursuant to
Section 11(d) hereof) per share of Preferred Stock on such record date, less the
fair market value (as determined in good faith by the Board of Directors of the
Company, whose determination shall be described in a statement filed with the
Rights Agent) of the portion of the cash, assets or evidences of indebtedness so
to be distributed or of such subscription rights or warrants applicable to a
share of Preferred Stock and the denominator of which shall be such current
market price (as determined pursuant to Section 11(d) hereof) per share of
Preferred Stock; provided, however, that in no event shall the consideration to
be paid upon the exercise of one Right be less than the aggregate par value of
the shares of capital stock of the Company issuable upon the exercise of one
Right. Such adjustments shall be made successively whenever such a record date
is fixed, and in the event that such distribution is not so made, the Purchase
Price shall be adjusted to be the Purchase Price which would have been in effect
if such record date had not been fixed.

          (d) (i) For the purpose of any computation hereunder, other than
computations made pursuant to Section 11(a)(iii) hereof, the "current market
price" per share of Common Stock on any date shall be deemed to be the average
of the daily closing prices per share of such Common Stock for the thirty (30)
consecutive Trading Days (as such term is hereinafter defined) immediately prior
to such date, and for purposes of computations made pursuant to Section
11(a)(iii) hereof, the "current market price" per share of Common Stock on any
date shall be deemed to be the average of the daily closing prices per share of
such Common Stock for the ten (10) consecutive Trading Days immediately
following such date; provided, however, that in the event that the current
market price per share of the Common Stock is determined during a period
following the announcement by the issuer of such Common Stock of (A) a dividend
or distribution on such Common Stock payable in shares of such Common Stock or
securities convertible into shares of such Common Stock (other than the Rights),
or (B) any subdivision, combination or reclassification of such Common Stock,
and prior to the expiration of the requisite thirty (30) Trading Day or ten (10)
Trading Day period, as set forth above, after the dividend date for such
dividend or distribution, or the record date for such subdivision, combination
or reclassification, then, and in each such case, the "current market price"
shall be properly adjusted to take into account the effect of such dividend,
distribution, subdivision, combination or reclassification. The closing price
for each day shall be the last sale price, regular way, or, in case no such sale
takes place on such day, the average of the closing bid and asked prices,
regular way, in either case as reported in the principal consolidated
transaction reporting system with respect to securities listed or admitted to
trading on the New York Stock Exchange or, if the shares of Common Stock are not
listed or admitted to trading on the New York Stock Exchange, as reported in the
principal consolidated transaction reporting system with respect to securities
listed on the principal national securities exchange on which the shares of
Common Stock are listed or admitted to trading or, if the shares of Common Stock
are not listed or

                                       18
<PAGE>
admitted to trading on any national securities exchange, the last quoted price
or, if not so quoted, the average of the high bid and low asked prices in the
over-the-counter market, as reported by the National Association of Securities
Dealers, Inc. Automated Quotation System ("NASDAQ") or such other system then in
use, or, if on any such date the shares of Common Stock are not quoted by any
such organization, the average of the closing bid and asked prices as furnished
by a professional market maker making a market in the Common Stock selected by
the Board of Directors of the Company. If on any such date no market maker is
making a market in the Common Stock, the fair value of such shares on such date
as determined in good faith by the Board of Directors of the Company shall be
used. The term "Trading Day" shall mean a day on which the principal national
securities exchange on which the shares of Common Stock are listed or admitted
to trading is open for the transaction of business or, if the shares of Common
Stock are not listed or admitted to trading on any national securities exchange,
a Business Day. If the Common Stock is not publicly held or not so listed or
traded, "current market price" per share shall mean the fair value per share as
determined in good faith by the Board of Directors of the Company, whose
determination shall be described in a statement filed with the Rights Agent and
shall be conclusive for all purposes.

               (ii) For the purpose of any computation hereunder, the "current
market price" per share of Preferred Stock shall be determined in the same
manner as set forth above for the Common Stock in clause (i) of this Section
11(d) (other than the last sentence thereof). If the current market price per
share of Preferred Stock cannot be determined in the manner provided above or if
the Preferred Stock is not publicly held or listed or traded in a manner
described in clause (i) of this Section 11(d), the "current market price" per
share of Preferred Stock shall be conclusively deemed to be an amount equal to
100 (as such number may be appropriately adjusted for such events as stock
splits, stock dividends and recapitalizations with respect to the Common Stock
occurring after the date of this Agreement) multiplied by the current market
price per share of the Common Stock. If neither the Common Stock nor the
Preferred Stock is publicly held or so listed or traded, "current market price"
per share of the Preferred Stock shall mean the fair value per share as
determined in good faith by the Board of Directors of the Company, whose
determination shall be described in a statement filed with the Rights Agent and
shall be conclusive for all purposes. For all purposes of this Agreement, the
"current market price" of one one-hundredth of a share of Preferred Stock shall
be equal to the "current market price" of one share of Preferred Stock divided
by one hundred (100).

          (e) Anything herein to the contrary notwithstanding, no adjustment in
the Purchase Price shall be required unless such adjustment would require an
increase or decrease of at least one percent (1%) in the Purchase Price;
provided, however, that any adjustments which by reason of this Section 11(e)
are not required to be made shall be carried forward and taken into account in
any subsequent adjustment. All calculations under this Section 11 shall be made
to the nearest cent or to the nearest ten-thousandth of a share of Common Stock
or other share or one-millionth of a share of Preferred Stock, as the case may
be. Notwithstanding the first sentence of this Section 11(e), any adjustment
required by this Section 11 shall be made no later than the earlier of (i) three
(3) years from the date of the transaction which mandates such adjustment, or
(ii) the Expiration Date.

          (f) If as a result of an adjustment made pursuant to Section 11(a)(ii)
or Section 13(a) hereof, the holder of any Right thereafter exercised shall
become entitled to receive any shares of capital stock other than Preferred
Stock, thereafter the number of such other shares so receivable upon exercise of
any Right and the Purchase Price thereof shall be subject to adjustment from
time to time in a manner and on terms as nearly equivalent as practicable to the
provisions with

                                       19
<PAGE>
respect to the Preferred Stock contained in Sections 11(a), (b), (c), (e), (g),
(h), (i), (j), (k) and (m), and the provisions of Sections 7, 9, 10, 13 and 14
hereof with respect to the Preferred Stock shall apply on like terms to any such
other shares.

          (g) All Rights originally issued by the Company subsequent to any
adjustment made to the Purchase Price hereunder shall evidence the right to
purchase, at the adjusted Purchase Price, the number of one one-hundredths of a
share of Preferred Stock purchasable from time to time hereunder upon exercise
of the Rights, all subject to further adjustment as provided herein.

          (h) Unless the Company shall have exercised its election as provided
in Section 11(i), upon each adjustment of the Purchase Price as a result of the
calculations made in Sections 11(b) and (c), each Right outstanding immediately
prior to the making of such adjustment shall thereafter evidence the right to
purchase, at the adjusted Purchase Price, that number of one one-hundredths of a
share of Preferred Stock (calculated to the nearest one millionth) obtained by
(i) multiplying (x) the number of one one-hundredths of a share covered by a
Right immediately prior to this adjustment, by (y) the Purchase Price in effect
immediately prior to such adjustment of the Purchase Price, and (ii) dividing
the product so obtained by the Purchase Price in effect immediately after such
adjustment of the Purchase Price.

          (i) The Company may elect on or after the date of any adjustment of
the Purchase Price to adjust the number of Rights, in lieu of any adjustment in
the number of one one-hundredths of a share of Preferred Stock purchasable upon
the exercise of a Right. Each of the Rights outstanding after the adjustment in
the number of Rights shall be exercisable for the number of one one-hundredths
of a share of Preferred Stock for which a Right was exercisable immediately
prior to such adjustment. Each Right held of record prior to such adjustment of
the number of Rights shall become that number of Rights (calculated to the
nearest one ten-thousandth) obtained by dividing the Purchase Price in effect
immediately prior to adjustment of the Purchase Price by the Purchase Price in
effect immediately after adjustment of the Purchase Price. The Company shall
make a public announcement (with prompt written notice thereof to the Rights
Agent) of its election to adjust the number of Rights, indicating the record
date for the adjustment, and, if known at the time, the amount of the adjustment
to be made. This record date may be the date on which the Purchase Price is
adjusted or any day thereafter, but, if the Rights Certificates have been
issued, shall be at least ten (10) days later than the date of the public
announcement. If Rights Certificates have been issued, upon each adjustment of
the number of Rights pursuant to this Section 11(i), the Company shall, as
promptly as practicable, cause to be distributed to holders of record of Rights
Certificates on such record date Rights Certificates evidencing, subject to
Section 14 hereof, the additional Rights to which such holders shall be entitled
as a result of such adjustment, or, at the option of the Company, shall cause to
be distributed to such holders of record in substitution and replacement for the
Rights Certificates held by such holders prior to the date of adjustment, and
upon surrender thereof, if required by the Company, new Rights Certificates
evidencing all the Rights to which such holders shall be entitled after such
adjustment. Rights Certificates so to be distributed shall be issued, executed
and delivered by the Company and countersigned and delivered by the Rights Agent
in the manner provided for herein (and may bear, at the option of the Company,
the adjusted Purchase Price) and shall be registered in the names of the holders
of record of Rights Certificates on the record date specified in the public
announcement.

          (j) Irrespective of any adjustment or change in the Purchase Price or
the number of one one-hundredths of a share of Preferred Stock issuable upon the
exercise of the Rights, the

                                       20
<PAGE>
Rights Certificates theretofore and thereafter issued may continue to express
the Purchase Price per one one-hundredths of a share and the number of one
one-hundredths of a share which were expressed in the initial Rights
Certificates issued hereunder.

          (k) Before taking any action that would cause an adjustment reducing
the Purchase Price below the then par or stated value, if any, of the number of
one one-hundredths of a share of Preferred Stock issuable upon exercise of the
Rights, the Company shall take any corporate action which may, in the opinion of
its counsel, be necessary in order that the Company may validly and legally
issue fully paid and nonassessable such number of one one-hundredths of a share
of Preferred Stock at such adjusted Purchase Price.

          (l) In any case in which this Section 11 shall require that an
adjustment in the Purchase Price be made effective as of a record date for a
specified event, the Company may elect to defer (with prompt written notice
thereof to the Rights Agent) until the occurrence of such event the issuance to
the holder of any Right exercised after such record date the number of one
one-hundredths of a share of Preferred Stock and other capital stock or
securities of the Company, if any, issuable upon such exercise over and above
the number of one one-hundredths of a share of Preferred Stock and other capital
stock or securities of the Company, if any, issuable upon such exercise on the
basis of the Purchase Price in effect prior to such adjustment; provided,
however, that the Company shall deliver to such holder a due bill or other
appropriate instrument evidencing such holder's right to receive such additional
shares (fractional or otherwise) or securities upon the occurrence of the event
requiring such adjustment.

          (m) Anything in this Section 11 to the contrary notwithstanding, the
Company shall be entitled to make such reductions in the Purchase Price, in
addition to those adjustments expressly required by this Section 11, as and to
the extent that in their good faith judgment the Board of Directors of the
Company shall determine to be advisable in order that any (i) consolidation or
subdivision of the Preferred Stock, (ii) issuance wholly for cash of any shares
of Preferred Stock at less than the current market price, (iii) issuance wholly
for cash of shares of Preferred Stock or securities which by their terms are
convertible into or exchangeable for shares of Preferred Stock, (iv) stock
dividend or (v) issuance of rights, options or warrants referred to in this
Section 11, hereafter made by the Company to holders of its Preferred Stock
shall not be taxable to such stockholders.

          (n) The Company covenants and agrees that it shall not, at any time
after the Distribution Date, (i) consolidate with any other Person (other than a
Subsidiary of the Company in a transaction which complies with Section 11(o)
hereof), (ii) merge with or into any other Person (other than a Subsidiary of
the Company in a transaction which complies with Section 11(o) hereof), or (iii)
sell or transfer (or permit any Subsidiary to sell or transfer), in one
transaction, or a series of related transactions, assets or earning power
aggregating more than fifty percent (50%) of the assets or earning power of the
Company and its Subsidiaries (taken as a whole) to any other Person or Persons
(other than the Company and or any of its Subsidiaries in one or more
transactions each of which complies with Section 11(o) hereof), if (x) at the
time of or immediately after such consolidation, merger or sale there are any
rights, warrants or other instruments or securities outstanding or agreements in
effect which would substantially diminish or otherwise eliminate the benefits
intended to be afforded by the Rights or (y) prior to, simultaneously with or
immediately after such consolidation, merger or sale, the stockholders of the
Person who constitutes, or would

                                       21
<PAGE>
constitute, the "Principal Party" for the purposes of Section 13(a) hereof shall
have received a distribution of Rights previously owned by such Person or any of
its Affiliates and Associates.

          (o) The Company covenants and agrees that, after the Distribution
Date, it will not, except as permitted by Section 23, Section 24 or Section 27
hereof, take (or permit any Subsidiary to take) any action if at the time such
action is taken it is reasonably foreseeable that such action will diminish
substantially or otherwise eliminate the benefits intended to be afforded by the
Rights.

          (p) Anything in this Agreement to the contrary notwithstanding, in the
event that the Company shall at any time after the Rights Dividend Declaration
Date and prior to the Distribution Date (i) declare a dividend on the
outstanding shares of Common Stock payable in shares of Common Stock, (ii)
subdivide the outstanding Common Stock, or (iii) combine the outstanding Common
Stock into a smaller number of shares, the number of Rights associated with each
share of Common Stock then outstanding, or issued or delivered thereafter but
prior to the Distribution Date, shall be proportionately adjusted so that the
number of Rights thereafter associated with each share of Common Stock following
any such event shall equal the result obtained by multiplying the number of
Rights associated with each share of Common Stock immediately prior to such
event by a fraction, the numerator of which shall be the total number of shares
of Common Stock outstanding immediately prior to the occurrence of the event and
the denominator of which shall be the total number of shares of Common Stock
outstanding immediately following the occurrence of such event.

     SECTION 12. CERTIFICATE OF ADJUSTED PURCHASE PRICE OR NUMBER OF SHARES.
Whenever an adjustment is made as provided in Section 11 and Section 13 hereof,
the Company shall (a) promptly prepare a certificate setting forth such
adjustment and a brief, reasonably detailed statement of the facts, computations
and methodology accounting for such adjustment, (b) promptly file with the
Rights Agent, and with each transfer agent for the Preferred Stock and the
Common Stock, a copy of such certificate, and (c) mail a brief summary thereof
to each holder of a Rights Certificate (or, if prior to the Distribution Date,
to each holder of a certificate representing shares of Common Stock) in
accordance with Section 26 hereof. Notwithstanding the foregoing sentence, the
failure of the Company to make such certification or give such notice shall not
affect the validity of such adjustment or the force or effect of the requirement
for such adjustment. The Rights Agent shall be fully protected in relying on any
such certificate and on any adjustment therein contained and shall have no duty
or liability with respect to, and shall not be deemed to have knowledge of, any
adjustment unless and until it shall have received any such certificate.

     SECTION 13. CONSOLIDATION, MERGER OR SALE OR TRANSFER OF ASSETS OR EARNING
POWER.

          (a) In the event that, following the Stock Acquisition Date, directly
or indirectly, (x) the Company shall consolidate with, or merge with and into,
any other Person (other than a Subsidiary of the Company in a transaction which
complies with Section 11(o) hereof), and the Company shall not be the continuing
or surviving corporation of such consolidation or merger, (y) any Person (other
than a Subsidiary of the Company in a transaction which complies with Section
11(o) hereof) shall consolidate with, or merge with or into, the Company, and
the Company shall be the continuing or surviving corporation of such
consolidation or merger and, in connection with such consolidation or merger,
all or part of the outstanding shares of Common Stock shall be changed into or
exchanged for stock or other securities of any other Person or cash or any other

                                       22
<PAGE>
property, or (z) the Company shall sell or otherwise transfer (or one or more of
its Subsidiaries shall sell or otherwise transfer), in one transaction or a
series of related transactions, assets or earning power aggregating more than
fifty percent (50%) of the assets or earning power of the Company and its
Subsidiaries (taken as a whole) to any Person or Persons (other than the Company
or any Subsidiary of the Company in one or more transactions each of which
complies with Section 11(o) hereof), then, and in each such case, proper
provision shall be made so that: (i) each holder of a Right, except as provided
in Section 7(e) hereof, shall thereafter have the right to receive, upon the
exercise thereof at the then current Purchase Price in accordance with the terms
of this Agreement, such number of validly authorized and issued, fully paid,
nonassessable and freely tradable shares of Common Stock of the Principal Party
(as such term is hereinafter defined), not subject to any liens, encumbrances,
rights of first refusal or other adverse claims, as shall be equal to the result
obtained by (1) multiplying the then current Purchase Price by the number of one
one-hundredths of a share of Preferred Stock for which a Right is exercisable
immediately prior to the first occurrence of a Section 13 Event (or, if a
Section 11(a)(ii) Event has occurred prior to the first occurrence of a Section
13 Event, multiplying the number of such one one-hundredths of a share for which
a Right was exercisable immediately prior to the first occurrence of a Section
11(a)(ii) Event by the Purchase Price in effect immediately prior to such first
occurrence), and (2) dividing that product (which, following the first
occurrence of a Section 13 Event, shall be referred to as the "Purchase Price"
for each Right and for all purposes of this Agreement) by fifty percent (50%) of
the current market price (determined pursuant to Section 11(d)(i) hereof) per
share of the Common Stock of such Principal Party on the date of consummation of
such Section 13 Event; (ii) such Principal Party shall thereafter be liable for,
and shall assume, by virtue of such Section 13 Event, all the obligations and
duties of the Company pursuant to this Agreement; (iii) the term "Company" shall
thereafter be deemed to refer to such Principal Party, it being specifically
intended that the provisions of Section 11 hereof shall apply only to such
Principal Party following the first occurrence of a Section 13 Event; (iv) such
Principal Party shall take such steps (including, but not limited to, the
reservation of a sufficient number of shares of its Common Stock) in connection
with the consummation of any such transaction as may be necessary to assure that
the provisions hereof shall thereafter be applicable, as nearly as reasonably
may be, in relation to its shares of Common Stock thereafter deliverable upon
the exercise of the Rights; provided, however, that upon the subsequent
occurrence of any merger, consolidation, sale of all or substantially all
assets, recapitalization, reclassification of shares, reorganization or other
extraordinary transaction in respect of such Principal Party, each holder of a
Right shall thereupon be entitled to receive, upon exercise of a Right and
payment of the Purchase Price, such cash, shares, rights, warrants and other
property which such holder would have been entitled to receive had he, at the
time of such transaction, owned the shares of Common Stock of the Principal
Party purchasable upon the exercise of a Right, and such Principal Party shall
take such steps (including, but not limited to, reservation of shares of stock)
as may be necessary to permit the subsequent exercise of the Rights in
accordance with the terms hereof for such cash, shares, rights, warrants and
other property; and (v) the provisions of Section 11(a)(ii) hereof shall be of
no effect following the first occurrence of any Section 13 Event.

          (b) "Principal Party" shall mean:

               (i) in the case of any transaction described in clause (x) or (y)
of the first sentence of Section 13(a), the Person that is the issuer of any
securities into which shares of Common Stock of the Company are converted in
such merger or consolidation, and if no securities are so issued, the Person
that is the other party to such merger or consolidation; and

                                       23
<PAGE>
               (ii) in the case of any transaction described in clause (z) of
the first sentence of Section 13(a), the Person that is the party receiving the
greatest portion of the assets or earning power transferred pursuant to such
transaction or transactions;

provided, however, that in any such case, (1) if the Common Stock of such Person
is not at such time and has not been continuously over the preceding twelve (12)
month period registered under Section 12 of the Exchange Act, and such Person is
a direct or indirect Subsidiary of another Person the Common Stock of which is
and has been so registered, "Principal Party" shall refer to such other Person
whose Common Stock is so registered; and (2) in case such Person is a
Subsidiary, directly or indirectly, of more than one Person, the Common Stocks
of two or more of which are and have been so registered, "Principal Party" shall
refer to whichever of such Persons is the issuer of the Common Stock having the
greatest aggregate market value.

          (c) If, for any reason, the Rights cannot be exercised for Common
Stock of such Principal Party as provided in Section 13(a), then each holder of
Rights shall have the right to exchange its Rights for cash from such Principal
Party in an amount equal to the number of shares of Common Stock that it would
otherwise be entitled to purchase times fifty percent (50%) of the current per
share market price, as determined pursuant to Section 11(d) hereof, of such
Common Stock of such Principal Party. If, for any reason, the foregoing
formulation cannot be applied to determine the cash amount into which the Rights
are exchangeable, then the Board of Directors, based upon the advice of one or
more nationally recognized investment banking firms, and based upon the total
value of the Company, shall determine such amount reasonably and with good faith
to the holders of Rights. Any such determination shall be final and binding on
the Rights Agent.

          (d) The Company shall not consummate any such consolidation, merger,
sale or transfer unless the Principal Party shall have a sufficient number of
authorized shares of its Common Stock which have not been issued or reserved for
issuance to permit the exercise in full of the Rights in accordance with this
Section 13 and unless prior thereto the Company and such Principal Party shall
have executed and delivered to the Rights Agent a supplemental agreement
providing for the terms set forth in paragraphs (a) and (b) of this Section 13
and further providing that, as soon as practicable after the date of any
consolidation, merger or sale of assets mentioned in paragraph (a) of this
Section 13, the Principal Party will:

               (i) prepare and file a registration statement under the Act, with
respect to the Rights and the securities purchasable upon exercise of the Rights
on an appropriate form, and will use its best efforts to cause such registration
statement to (A) become effective as soon as practicable after such filing and
(B) remain effective (with a prospectus at all times meeting the requirements of
the Act) until the Expiration Date;

               (ii) deliver to holders of the Rights historical financial
statements for the Principal Party and each of its Affiliates which comply in
all respects with the requirements for registration on Form 10 under the
Exchange Act;

               (iii) use its best efforts, if the Common Stock of the Principal
Party shall become listed on a national securities exchange, to list (or
continue the listing of) the Rights and the securities purchasable upon exercise
of the Rights on such securities exchange and, if the Common Stock of the
Principal Party shall not be listed on a national securities exchange, to cause
the Rights

                                       24
<PAGE>
and the securities purchasable upon exercise of the Rights to be reported by
NASDAQ or such other system then in use; and

               (iv) obtain waivers of any rights of first refusal or preemptive
rights in respect of the shares of Common Stock of the Principal Party subject
to purchase upon exercise of outstanding Rights.

          (e) The provisions of this Section 13 shall similarly apply to
successive mergers or consolidations or sales or other transfers. In the event
that a Section 13 Event shall occur at any time after the occurrence of a
Section 11(a)(ii) Event, the Rights which have not theretofore been exercised
shall thereafter become exercisable in the manner described in Section 13(a).

     SECTION 14. FRACTIONAL RIGHTS AND FRACTIONAL SHARES.

          (a) The Company shall not be required to issue fractions of Rights,
except prior to the Distribution Date as provided in Section 11(p) hereof, or to
distribute Rights Certificates which evidence fractional Rights. In lieu of such
fractional Rights, there shall be paid to the registered holders of the Rights
Certificates with regard to which such fractional Rights would otherwise be
issuable, an amount in cash equal to the same fraction of the current market
value of a whole Right. For purposes of this Section 14(a), the current market
value of a whole Right shall be the closing price of the Rights for the Trading
Day immediately prior to the date on which such fractional Rights would have
been otherwise issuable. The closing price of the Rights for any day shall be
the last sale price, regular way, or, in case no such sale takes place on such
day, the average of the closing bid and asked prices, regular way, in either
case as reported in the principal consolidated transaction reporting system with
respect to securities listed or admitted to trading on the New York Stock
Exchange or, if the Rights are not listed or admitted to trading on the New York
Stock Exchange, as reported in the principal consolidated transaction reporting
system with respect to securities listed on the principal national securities
exchange on which the Rights are listed or admitted to trading, or if the Rights
are not listed or admitted to trading on any national securities exchange, the
last quoted price or, if not so quoted, the average of the high bid and low
asked prices in the over-the-counter market, as reported by NASDAQ or such other
system then in use or, if on any such date the Rights are not quoted by any such
organization, the average of the closing bid and asked prices as furnished by a
professional market maker making a market in the Rights selected by the Board of
Directors of the Company. If on any such date no such market maker is making a
market in the Rights the fair value of the Rights on such date as determined in
good faith by the Board of Directors of the Company shall be used.

          (b) The Company shall not be required to issue fractions of shares of
Preferred Stock (other than fractions which are integral multiples of one
one-hundredth of a share of Preferred Stock) upon exercise of the Rights or to
distribute certificates which evidence fractional shares of Preferred Stock
(other than fractions which are integral multiples of one one-hundredth of a
share of Preferred Stock). In lieu of fractional shares of Preferred Stock that
are not integral multiples of one one-hundredth of a share of Preferred Stock,
the Company may pay to the registered holders of Rights Certificates at the time
such Rights are exercised as herein provided an amount in cash equal to the same
fraction of the current market value of one one-hundredth of a share of
Preferred Stock. For purposes of this Section 14(b), the current market value of
one one-hundredth of a share of Preferred Stock shall be one-hundredth of the
closing price of a share of Preferred Stock (as

                                       25
<PAGE>
determined pursuant to Section 11(d)(ii) hereof) for the Trading Day immediately
prior to the date of such exercise.

          (c) Following the occurrence of a Triggering Event, the Company shall
not be required to issue fractions of shares of Common Stock upon exercise of
the Rights or to distribute certificates which evidence fractional shares of
Common Stock. In lieu of fractional shares of Common Stock, the Company may pay
to the registered holders of Rights Certificates at the time such Rights are
exercised as herein provided an amount in cash equal to the same fraction of the
current market value of one (1) share of Common Stock. For purposes of this
Section 14(c), the current market value of one share of Common Stock shall be
the closing price of one share of Common Stock (as determined pursuant to
Section 11(d)(i) hereof) for the Trading Day immediately prior to the date of
such exercise.

          (d) Whenever a payment for fractional Rights or any fractional shares
is to be made by the Rights Agent, the Company shall (i) promptly prepare and
deliver to the Rights Agent a certificate setting forth in reasonable detail the
facts related to such payments and the prices and/or formulas utilized in
calculating such payments, and (ii) provide sufficient monies to the Rights
Agent in the form of fully collected funds to make such payments. The Rights
Agent shall be fully protected in relying upon such a certificate and shall have
no duty with respect to, and shall not be deemed to have knowledge of any
payment for fractional Rights or fractional shares unless and until the Rights
Agent shall have received such a certificate and sufficient monies.

          (e) The holder of a Right by the acceptance of the Rights expressly
waives his right to receive any fractional Rights or any fractional shares upon
exercise of a Right, except as permitted by this Section 14.

     SECTION 15. RIGHTS OF ACTION. All rights of action in respect of this
Agreement, excepting the rights of action given to the Rights Agent under
Section 18 and Section 20 hereof, are vested in the respective registered
holders of the Rights Certificates (and, prior to the Distribution Date, the
registered holders of the Common Stock); and any registered holder of any Rights
Certificate (or, prior to the Distribution Date, of the Common Stock), without
the consent of the Rights Agent or of the holder of any other Rights Certificate
(or, prior to the Distribution Date, of the Common Stock), may, in his own
behalf and for his own benefit, enforce, and may institute and maintain any
suit, action or proceeding against the Company to enforce, or otherwise act in
respect of, his right to exercise the Rights evidenced by such Rights
Certificate in the manner provided in such Rights Certificate and in this
Agreement. Without limiting the foregoing or any remedies available to the
holders of Rights, it is specifically acknowledged that the holders of Rights
would not have an adequate remedy at law for any breach by the Company of this
Agreement and shall be entitled to specific performance of the obligations
hereunder and injunctive relief against actual or threatened violations by the
Company of the obligations hereunder of any Person subject to this Agreement.
Notwithstanding anything in this Agreement to the contrary, neither the Company
nor the Rights Agent shall have any liability to any holder of a Right or other
Person as a result of its inability to perform any of its obligations under this
Agreement by reason of any preliminary or permanent injunction or other order,
judgment decree or ruling (whether interlocutory or final) issued by a court of
competent jurisdiction or by a governmental, regulatory, self-regulatory or
administrative agency or commission, or any statute, rule, regulation or
executive order promulgated or enacted by any governmental authority,
prohibiting or otherwise restraining performance of such obligation; provided,
however, the Company must use all reasonable

                                       26
<PAGE>
efforts to have any such injunction, order, judgment, decree or ruling lifted or
otherwise overturned as soon as possible.

     SECTION 16. AGREEMENT OF RIGHTS HOLDERS. Every holder of a Right by
accepting the same consents and agrees with the Company and the Rights Agent and
with every other holder of a Right that:

          (a) prior to the Distribution Date, the Rights will be transferable
only in connection with the transfer of Common Stock;

          (b) after the Distribution Date, the Rights Certificates are
transferable only on the registry books of the Rights Agent if surrendered at
the principal office or offices of the Rights Agent designated for such
purposes, duly endorsed or accompanied by proper instruments of transfer and
with the appropriate forms and certificates fully executed; and

          (c) subject to Section 6(a) and Section 7(f) hereof, the Company and
the Rights Agent may deem and treat the person in whose name a Rights
Certificate (or, prior to the Distribution Date, the associated Common Stock
certificate) is registered as the absolute owner thereof and of the Rights
evidenced thereby (notwithstanding any notations of ownership or writing on the
Rights Certificates or the associated Common Stock certificate made by anyone
other than the Company or the Rights Agent) for all purposes whatsoever, and
neither the Company nor the Rights Agent shall be required to be affected by any
notice to the contrary.

     SECTION 17. RIGHTS CERTIFICATE HOLDER NOT DEEMED A STOCKHOLDER. No holder,
as such, of any Rights Certificate shall be entitled to vote, receive dividends
or be deemed for any purpose the holder of the number of one one-hundredths of a
share of Preferred Stock or any other securities of the Company which may at any
time be issuable on the exercise of the Rights represented thereby, nor shall
anything contained herein or in any Rights Certificate be construed to confer
upon the holder of any Rights Certificate, as such, any of the rights of a
stockholder of the Company or any right to vote for the election of directors or
upon any matter submitted to stockholders at any meeting thereof, or to give or
withhold consent to any corporate action, or to receive notice of meetings or
other actions affecting stockholders (except as provided in Section 25 hereof),
or to receive dividends or subscription rights, or otherwise, until the Right or
Rights evidenced by such Rights Certificate shall have been exercised in
accordance with the provisions hereof.

     SECTION 18. CONCERNING THE RIGHTS AGENT.

          (a) The Company agrees to pay to the Rights Agent reasonable
compensation for all services rendered by it hereunder and, from time to time,
on demand of the Rights Agent, its reasonable expenses and counsel fees and
disbursements and other disbursements incurred in the preparation, delivery,
amendment, administration and execution of this Agreement and the exercise and
performance of its duties hereunder. The Company also agrees to indemnify the
Rights Agent for, and to hold it harmless against, any loss, liability, damage,
judgment, fine, penalty, claim, demand, settlement, cost or expense (including,
without limitation, the reasonable fees and expenses of legal counsel) for any
action taken, suffered or omitted by the Rights Agent in connection with the
acceptance, administration, exercise and performance of its duties under this
Agreement, including the costs and expenses of defending against any claim of
liability in the premises and of enforcing this rights of indemnification;
provided, however, that the Company shall not be liable under this

                                       27
<PAGE>
Section 18(a) to the extent a court of competent jurisdiction shall have
determined by a final, non-appealable order, judgment, decree or ruling that
such loss, liability, damage, judgment, fine, penalty, claim, demand,
settlement, cost or expense resulted from any action taken, suffered or omitted
by the Rights Agent through its gross negligence, bad faith or willful
misconduct. The provisions of this Section 18 and Section 20 hereof shall
survive the termination of this Agreement, the exercise or expiration of the
Rights and the resignation, replacement or removal of the Rights Agent.

          (b) The Rights Agent shall be authorized and protected and shall incur
no liability for or in respect of any action taken, suffered or omitted by it in
connection with its acceptance and administration of this Agreement and the
exercise and performance of its duties hereunder in reliance upon any Rights
Certificate or certificate for Common Stock or for other securities of the
Company, instrument of assignment or transfer, power of attorney, endorsement,
affidavit, letter, notice, direction, consent, certificate, statement, or other
paper or document believed by it to be genuine and to be signed, executed and,
where necessary, verified or acknowledged, by the proper Person or Persons, or
otherwise upon the advice of counsel as set forth in Section 20 hereof.

     SECTION 19. MERGER OR CONSOLIDATION OR CHANGE OF NAME OF RIGHTS AGENT.

          (a) Any Person into which the Rights Agent or any successor Rights
Agent may be merged or with which it may be consolidated, or any Person
resulting from any merger or consolidation to which the Rights Agent or any
successor Rights Agent shall be a party, or any Person succeeding to the stock
transfer or corporate trust business of the Rights Agent or any successor Rights
Agent, shall be the successor to the Rights Agent under this Agreement without
the execution or filing of any paper or any further act on the part of any of
the parties hereto; provided, however, that such Person would be eligible for
appointment as a successor Rights Agent under the provisions of Section 21
hereof. In case at the time such successor Rights Agent shall succeed to the
agency created by this Agreement, any of the Rights Certificates shall have been
countersigned but not delivered, any such successor Rights Agent may adopt the
countersignature of a predecessor Rights Agent and deliver such Rights
Certificates so countersigned; and in case at that time any of the Rights
Certificates shall not have been countersigned, any successor Rights Agent may
countersign such Rights Certificates either in the name of the predecessor
Rights Agent or in the name of the successor Rights Agent; and in all such cases
such Rights Certificates shall have the full force provided in the Rights
Certificates and in this Agreement.

          (b) In case at any time the name of the Rights Agent shall be changed
and at such time any of the Rights Certificates shall have been countersigned
but not delivered, the Rights Agent may adopt the countersignature under its
prior name and deliver Rights Certificates so countersigned; and in case at that
time any of the Rights Certificates shall not have been countersigned, the
Rights Agent may countersign such Rights Certificates either in its prior name
or in its changed name; and in all such cases such Rights Certificates shall
have the full force provided in the Rights Certificates and in this Agreement.

     SECTION 20. RIGHTS AND DUTIES OF RIGHTS AGENT. The Rights Agent undertakes
to perform only the duties and obligations expressly imposed by this Agreement
(and no implied duties) upon the following terms and conditions, by all of which
the Company and the holders of Rights Certificates, by their acceptance thereof,
shall be bound:

                                       28
<PAGE>
          (a) The Rights Agent may consult with legal counsel (who may be legal
counsel for the Company or an employee of the Rights Agent), and the advice or
opinion of such counsel shall be full and complete authorization and protection
to the Rights Agent as to, and the Rights Agent shall incur no liability for or
in respect of, any action taken, suffered or omitted by it in good faith and in
accordance with such advice or opinion.

          (b) Whenever in the performance of its duties under this Agreement the
Rights Agent shall deem it necessary or desirable that any fact or matter
(including, without limitation, the identity of any Acquiring Person and the
determination of "current market price") be proved or established by the Company
prior to taking, suffering or omitting to take any action hereunder such fact or
matter (unless other evidence in respect thereof be herein specifically
prescribed) may be deemed to be conclusively proved and established by a
certificate signed by the Chairman of the Board, the President, any Vice
President, the Treasurer, any Assistant Treasurer, the Secretary or any
Assistant Secretary of the Company and delivered to the Rights Agent; and such
certificate shall be full and complete authorization and protection to the
Rights Agent for, and the Rights Agent shall incur no liability for or in
respect of, any action taken, suffered or omitted by it in good faith under the
provisions of this Agreement in reliance upon such certificate.

          (c) The Rights Agent shall be liable hereunder to the Company and any
other Person only for its own gross negligence, bad faith or willful misconduct.

          (d) The Rights Agent shall not be liable for or by reason of any of
the statements of fact or recitals contained in this Agreement or in the Rights
Certificates or be required to verify the same (except as to its
countersignature on such Rights Certificates), but all such statements and
recitals are and shall be deemed to have been made by the Company only.

          (e) The Rights Agent shall not have any liability for or be under any
responsibility with respect to the validity of this Agreement or the execution
and delivery hereof (except the due execution hereof by the Rights Agent) or
with respect to the validity or execution of any Rights Certificate (except its
countersignature thereof); nor shall it be responsible for any breach by the
Company of any covenant or condition contained in this Agreement or in any
Rights Certificate; nor shall it be responsible for any change in the
exercisability of the Rights (including the Rights becoming null and void
pursuant to Section 11 hereof) or any change or adjustment required under the
provisions of Section 11 or Section 13 hereof or responsible for the manner,
method or amount of any such change or adjustment or the ascertaining of the
existence of facts that would require any such change or adjustment (except with
respect to the exercise of Rights evidenced by Rights Certificates after receipt
of the certificate described in Section 12 hereof, upon which the Rights Agent
may rely); nor shall it by any act hereunder be deemed to make any
representation or warranty as to the authorization or reservation of any shares
of Common Stock or Preferred Stock to be issued pursuant to this Agreement or
any Rights Certificate or as to whether any shares of Common Stock or Preferred
Stock will, when so issued, be validly authorized and issued, fully paid and
nonassessable.

          (f) The Company agrees that it will perform, execute, acknowledge and
deliver or cause to be performed, executed, acknowledged and delivered all such
further and other acts, instruments and assurances as may reasonably be required
by the Rights Agent for the carrying out or performing by the Rights Agent of
the provisions of this Agreement.

                                       29
<PAGE>
          (g) The Rights Agent is hereby authorized and directed to accept
instructions with respect to the performance of its duties hereunder from the
Chairman of the Board, the President, any Vice President, the Secretary, any
Assistant Secretary, the Treasurer or any Assistant Treasurer of the Company,
and to apply to such officers for advice or instructions in connection with its
duties, and such instructions shall be full authorization and protection to the
Rights Agent and the Rights Agent shall not be liable for any action taken,
suffered or omitted by it in good faith in accordance with instructions of any
such officer or for any delay in action while waiting for those instructions.
The Rights Agent shall be fully authorized and protected in relying upon the
most recent instructions received by any such officer. Any application by the
Rights Agent for written instructions from the Company may, at the option of the
Rights Agent, set forth in writing any action proposed to be taken, suffered or
omitted by the Rights Agent under this Agreement and the date on and/or after
which such action shall be taken or suffered or such omission shall be
effective. The Rights Agent shall not be liable for any action taken, suffered
or omitted by the it in good faith in accordance with a proposal included in any
such application on or after the date specified in such application (which date
shall not be less than five Business Days after the date any officer of the
Company actually receives such application, unless any such officer shall have
consented in writing to an earlier date) unless, prior to taking any such action
(or the effective date in the case of an omission), the Rights Agent shall have
received written instructions in response to such application specifying the
action to be taken, suffered or omitted.

          (h) The Rights Agent and any stockholder, affiliate, director, officer
or employee of the Rights Agent may buy, sell or deal in any of the Rights or
other securities of the Company or become pecuniarily interested in any
transaction in which the Company may be interested, or contract with or lend
money to the Company or otherwise act as fully and freely as though the Rights
Agent were not Rights Agent under this Agreement. Nothing herein shall preclude
the Rights Agent or any such stockholder, affiliate, director, officer or
employee from acting in any other capacity for the Company or for any other
Person.

          (i) The Rights Agent may execute and exercise any of the rights or
powers hereby vested in it or perform any duty hereunder either itself (through
its directors, officer and employees) or by or through its attorneys or agents,
and the Rights Agent shall not be answerable or accountable for any act,
default, neglect or misconduct of any such attorneys or agents or for any loss
to the Company or any other Person resulting from any such act, default, neglect
or misconduct; provided, however, reasonable care was exercised in the selection
and continued employment thereof.

          (j) No provision of this Agreement shall require the Rights Agent to
expend or risk its own funds or otherwise incur any financial liability in the
performance of any of its duties hereunder or in the exercise of its rights if
there shall be reasonable grounds for believing that repayment of such funds or
adequate indemnification against such risk or liability is not reasonably
assured to it.

          (k) If, with respect to any Right Certificate surrendered to the
Rights Agent for exercise or transfer, the certificate contained in the form of
assignment or the form of election to purchase set forth on the reverse thereof,
as the case may be, has either not been completed or indicates an affirmative
response to clause 1 and/or 2 thereof, the Rights Agent shall not take any
further action with respect to such requested exercise or transfer without first
consulting with the Company.

                                       30
<PAGE>
     SECTION 21. CHANGE OF RIGHTS AGENT. The Rights Agent or any successor
Rights Agent may resign and be discharged from its duties under this Agreement
upon thirty (30) days' notice in writing, mailed to the Company, and to each
transfer agent of the Common Stock and Preferred Stock by registered or
certified mail, and to the holders of the Rights Certificates by first-class
mail. The Company may remove the Rights Agent or any successor Rights Agent upon
thirty (30) days' notice in writing, mailed to the Rights Agent or successor
Rights Agent, as the case may be, and to each transfer agent of the Common Stock
and Preferred Stock, by registered or certified mail, and to the holders of the
Rights Certificates by first-class mail. If the Rights Agent shall resign or be
removed or shall otherwise become incapable of acting, the Company shall appoint
a successor to the Rights Agent. If the Company shall fail to make such
appointment within a period of thirty (30) days after giving notice of such
removal or after it has been notified in writing of such resignation or
incapacity by the resigning or incapacitated Rights Agent or by the holder of a
Rights Certificate (who shall, with such notice, submit his Rights Certificate
for inspection by the Company), then any registered holder of any Rights
Certificate may apply to any court of competent jurisdiction for an appointment
of a new Rights Agent. Any successor Rights Agent, whether appointed by the
Company or by such a court, shall be (a) a Person organized and doing business
under the law of the United States or of the State of California (or of any
other state of the United States so long as such corporation is authorized to do
business as a banking institution in the State of California), in good standing,
having a principal office in the State of California, which is authorized under
such laws to exercise stock transfer or corporate trust powers and is subject to
supervision or examination by federal or state authority and which has at the
time of its appointment as Rights Agent a combined capital and surplus of at
least $100,000,000, or (b) an Affiliate of such a Person. After appointment, the
successor Rights Agent shall be vested with the same powers, rights, duties and
responsibilities as if it had been originally named as Rights Agent without
further act or deed; but the predecessor Rights Agent shall deliver and transfer
to the successor Rights Agent any property at the time held by it hereunder, and
execute and deliver any further assurance, conveyance, act or deed necessary for
the purpose. Not later than the effective date of any such appointment, the
Company shall file notice thereof in writing with the predecessor Rights Agent
and each transfer agent of the Common Stock and the Preferred Stock, and mail a
notice thereof in writing to the registered holders of the Rights Certificates.
Failure to give any notice provided for in this Section 21, however, or any
defect therein, shall not affect the legality or validity of the resignation or
removal of the Rights Agent or the appointment of the successor Rights Agent, as
the case may be.

     SECTION 22. ISSUANCE OF NEW RIGHTS CERTIFICATES. Notwithstanding any of the
provisions of this Agreement or of the Rights to the contrary, the Company may,
at its option, issue new Rights Certificates evidencing Rights in such form as
may be approved by its Board of Directors to reflect any adjustment or change in
the Purchase Price and the number or kind or class of shares or other securities
or property purchasable under the Rights Certificates made in accordance with
the provisions of this Agreement. In addition, in connection with the issuance
or sale of shares of Common Stock following the Distribution Date and prior to
the redemption or expiration of the Rights, the Company (a) shall, with respect
to shares of Common Stock so issued or sold pursuant to the exercise of stock
options or under any employee plan or arrangement, or upon the exercise,
conversion or exchange of securities hereinafter issued by the Company, and (b)
may, in any other case, if deemed necessary or appropriate by the Board of
Directors of the Company, issue Rights Certificates representing the appropriate
number of Rights in connection with such issuance or sale; provided, however,
that (i) no such Rights Certificate shall be issued if, and to the extent that,
the Company shall be advised by counsel that such issuance would create a
significant risk of material adverse tax consequences to the Company or the
Person to whom such Rights Certificate would be issued, and (ii) no such Rights
Certificate shall be

                                       31
<PAGE>
issued if, and to the extent that appropriate adjustment shall otherwise have
been made in lieu of the issuance thereof.

     SECTION 23. REDEMPTION.

          (a) The Board of Directors of the Company may, at its option, at any
time prior to the earlier of (i) the Close of Business on the tenth (10th) day
following the Stock Acquisition Date, or such later date as may be determined by
action of a majority of the Board of Directors then in office and publicly
announced by the Company (or, if the Stock Acquisition Date shall have occurred
prior to the Record Date, the Close of Business on the tenth (10th) day
following the Record Date, or such later date as may be determined by action of
a majority of the Board of Directors then in office and publicly announced by
the Company), or (ii) the Final Expiration Date, redeem all but not less than
all of the then outstanding Rights at a redemption price of $0.01 per Right, as
such amount may be appropriately adjusted to reflect any stock split, stock
dividend or similar transaction occurring after the date hereof (such redemption
price being hereinafter referred to as the "Redemption Price"). Notwithstanding
anything contained in this Agreement to the contrary, a Distribution Date shall
not occur and the Rights shall not be exercisable until such time as the
Company's right of redemption hereunder has expired.

          (b) (i) In the event the Company receives a Qualified Offer and the
Board of Directors has not redeemed the Rights, in accordance with Section 23(a)
above, within ninety (90) days of the date such Qualified Offer is received by
the Company (the "Offer Date"), then the Board of Directors shall call a special
meeting of stockholders for the purpose of voting on a resolution (i) accepting
such Qualified Offer, as such Qualified Offer may be amended or revised by the
offering Person from time to time to increase the price per share to be paid to
holders of shares of Common Stock, and (ii) authorizing the redemption of all
but not less than all of the then outstanding Rights at the Redemption Price
pursuant to subparagraph (b)(ii) of this Section 23. The special meeting shall
be held on a date selected by the Board of Directors, which date shall not be
less than ninety (90) or more than 120 days (subject to extension to satisfy any
then outstanding regulatory or information delivery requirements) after the
later of (A) the Offer Date, and (B) the date of any previously scheduled
meeting of stockholders held (or to be held) within sixty (60) days after the
Offer Date; provided, however, that if (x) such other meeting shall have been
called for the purpose of voting on a resolution with respect to another
Qualified Offer and (y) the Offer Date is not later than 15 days after the date
such other Qualified Offer was received by the Company, then both the resolution
relating to the first Qualified Offer and the resolution relating to such other
Qualified Offer shall be voted on at such special meeting (in addition to any
other matters or resolutions to be considered at such meeting); provided,
however, that in any 12-month period the Company shall not be required to hold
more than one special meeting with respect to a Qualified Offer from any given
potential Acquiring Person (including any Affiliates or Associates); and
provided further, that if the Company shall publicly announce that the Board of
Directors has determined that it is in the best interest of stockholders to seek
an alternative transaction so as to obtain greater value for stockholders than
that provided by such Qualified Offer, then such vote shall be postponed to a
meeting called by the Board of Directors which shall occur within 90 days after
the date of such announcement. The Board of Directors shall set a date for
determining the stockholders of record entitled to notice of and to vote at the
special meeting in accordance with the Company's Certificate of Incorporation,
By-Laws and applicable law. At the offering Person's request, the Company shall
include in any proxy soliciting material prepared by it in connection with the
special meeting proxy soliciting material submitted by the offering Person;
provided, however, that the offering Person, by written agreement with the

                                       32
<PAGE>
Company contained in or delivered with such request, shall have indemnified the
Company against any and all liabilities resulting from any statements found to
be defamatory, misstatements, misleading statements or omissions contained in or
omitted from the offering Person's proxy soliciting materials and have agreed to
pay the Company's incremental costs incurred as a result of including such
material in the Company's proxy soliciting material. Notwithstanding anything to
the contrary contained this Agreement, if the Board of Directors determines that
it is in the best interests of stockholders to seek an alternative transaction
so as to obtain greater value for stockholders than that provided by any
Qualified Offer, the Company shall be entitled to include information relating
to such alternative transaction in the proxy soliciting material prepared by it
in connection with the special meeting.

               (ii) If at the special meeting the resolution to accept the
Qualified Offer and authorize the redemption, or a resolution with respect to
another Qualified Offer, receives the affirmative vote of at least a majority of
the shares of Common Stock outstanding and entitled to vote as of the record
date of the special meeting, not giving effect to any affirmative votes cast by
the offering Person or any of its Affiliates, then all of the Rights shall be
redeemed by such stockholder action at the Redemption Price, effective
immediately prior to the consummation of the Qualified Offer (provided that the
Qualified Offer is consummated prior to sixty (60) days after the date of the
special meeting).

               (iii) Nothing in this subparagraph (b) shall be construed as
limiting or prohibiting the Company or any offering Person from proposing or
engaging in any acquisition, disposition or other transfer of any securities of
the Company, any merger or consolidation involving the Company, any sale or
other transfer of assets of the Company, any liquidation, dissolution or
winding-up of the Company, or any other business combination or other
transaction, or any other action by the Company or such offering Person;
provided, however, that the holders of Rights shall have the rights set forth in
this Rights Agreement with respect to any such acquisition, disposition,
transfer, merger, consolidation, sale, liquidation, dissolution, winding-up,
business combination, transaction or action.

          (c) Immediately upon the action of the Board of Directors of the
Company ordering the redemption of the Rights pursuant to subparagraph (a) of
this Section 23, or upon effectiveness of the redemption of the Rights pursuant
to subparagraph (b) of this Section 23, and without any further action and
without any notice, the right to exercise the Rights will terminate and the only
right thereafter of the holders of Rights shall be to receive the Redemption
Price for each Right so held. Promptly after the action of the Board of
Directors or stockholders, as applicable, ordering the redemption of the Rights,
the Company shall give public notice of such redemption (with prompt written
notice thereof to the Rights Agent); provided, however, that the failure to
give, or any defect in, any such notice shall not affect the legality or
validity of such redemption. The Company shall promptly mail a notice of any
such redemption to all the holders of the then outstanding Rights at their last
addresses as they appear upon the registry books of the Rights Agent or, prior
to the Distribution Date, on the registry books of the Transfer Agent for the
Common Stock. Any notice which is mailed in the manner herein provided shall be
deemed given, whether or not the holder receives the notice. Each such notice of
redemption will state the method by which the payment of the Redemption Price
will be made. Neither the Company nor any of its Affiliates or Associates may
redeem, acquire or purchase for value any Rights at any time in any manner other
than that specifically set forth in this Section 23 or in Section 24 hereof, and
other than in connection

                                       33
<PAGE>
with the purchase, acquisition or redemption of shares of Common Stock prior to
the Distribution Date.

          (d) The Company may, at its option, pay the Redemption Price in cash,
shares of Common Stock (based on the "current market value" as defined in
Section 11(d)(i) hereof) of the Common Stock as of the time of redemption) or
any other form of consideration deemed appropriate by the Board of Directors.

     SECTION 24. EXCHANGE.

          (a) Subject to applicable laws, rules and regulations, and subject to
subsection (c) below, the Company may, at its option, by majority vote of the
Board of Directors, at any time after any Person becomes an Acquiring Person,
exchange all or part of the then outstanding and exercisable Rights (which shall
not include Rights that have become null and void pursuant to the provisions of
Section 7(e) hereof) for Common Stock at an exchange ratio of one (1) share of
Common Stock per Right, appropriately adjusted to reflect any stock split, stock
dividend or similar transaction occurring after the date hereof (such exchange
ratio being hereinafter referred to as the "Ratio of Exchange"). Notwithstanding
the foregoing, the Board of Directors shall not be empowered to effect such
exchange at any time after any Person (other than the Company, any Subsidiary of
the Company, any employee benefit plan of the Company or any such Subsidiary, or
any entity holding Common Stock for or pursuant to the terms of any such plan),
together with all Affiliates and Associates of such Person, becomes the
Beneficial Owner of fifty percent (50%) or more of the Common Stock then
outstanding.

          (b) Immediately upon the action of the Board of Directors ordering the
exchange of any Rights pursuant to subsection (a) of this Section 24 and without
any further action and without any notice, the right to exercise such Rights
shall terminate and the only right thereafter of a holder of such rights shall
be to receive that number of shares of Common Stock equal to the number of such
Rights held by such holder multiplied by the Ratio of Exchange. The Company
shall promptly give public notice of any such exchange (with prompt written
notice thereof to the Rights Agent); provided, however, that the failure to
give, or any defect in, such notice shall not affect the legality or validity of
such exchange. The Company shall promptly mail a notice of any such exchange to
all of the holders of such Rights at their last addresses as they appear upon
the registry books of the Rights Agent. Any notice which is mailed in the manner
herein provided shall be deemed given, whether or not the holder receives the
notice. Each such notice of exchange will state the method by which the exchange
of the Common Stock for Rights will be effected and, in the event of any partial
exchange, the number of Rights which will be exchanged. Any partial exchange
shall be effected pro rata based on the number of Rights (other than Rights
which have become void pursuant to the provisions of Section 7(e) hereof) held
by each holder of Rights.

          (c) In the event that there shall not be sufficient shares of Common
Stock issued but not outstanding or authorized but unissued to permit any
exchange of Rights as contemplated in accordance with Section 24(a), the Company
shall either take such action as may be necessary to authorize additional Common
Stock for issuance upon exchange of the Rights or alternatively, at the option
of a majority of the Board of Directors, with respect to each Right (i) pay cash
in an amount equal to the Current Value (as hereinafter defined), in lieu of
issuing Common Stock in exchange therefor, or (ii) issue debt or equity
securities or a combination thereof, having a value equal to the Current Value
(as defined below), in lieu of issuing Common Stock in exchange for each such
Right,

                                       34
<PAGE>
where the value of such securities shall be determined by a nationally
recognized investment banking firm selected by the Board of Directors by
majority vote of the Board of Directors, or (iii) deliver any combination of
cash, property, Common Stock and/or other securities having a value equal to the
Current Value in exchange for each Right. For purposes of this Section 24(c)
only, the Current Value shall mean the product of the current per share market
price of Common Stock (determined pursuant to Section 11(d) on the date of the
occurrence of the event described above in subparagraph (a)) multiplied by the
number of shares of Common Stock for which the Right otherwise would be
exchangeable if there were sufficient shares available. To the extent that the
Company determines that some action need be taken pursuant to clauses (i), (ii)
or (iii) of this Section 24(c), the Board of Directors may temporarily suspend
the exercisability of the Rights for a period of up to sixty (60) days following
the date on which the event described in Section 24(a) shall have occurred, in
order to seek any authorization of additional shares of Common Stock and/or to
decide the appropriate form of distribution to be made pursuant to the above
provision and to determine the value thereof. In the event of any such
suspension, the Company shall issue a public announcement stating that the
exercisability of the Rights has been temporarily suspended.

          (d) The Company shall not be required to issue fractions of shares of
Common Stock or to distribute certificates which evidence fractional shares of
Common Stock. In lieu of such fractional shares of Common Stock, there shall be
paid to the registered holders of the Rights Certificates with regard to which
such fractional shares of Common Stock would otherwise be issuable, an amount in
cash equal to the same fraction of the current per share market value of a whole
share of Common Stock (as determined pursuant to the second sentence of Section
11(d) hereof).

          (e) The Company may, at its option, by majority vote of the Board of
Directors, at any time before any Person has become an Acquiring Person,
exchange all or part of the then outstanding Rights for rights of substantially
equivalent value, as determined reasonably and with good faith by the Board of
Directors, based upon the advice of one or more nationally recognized investment
banking firms.

          (f) Immediately upon the action of the Board of Directors ordering the
exchange of any Rights pursuant to subsection (e) of this Section 24 and without
any further action and without any notice, the right to exercise such Rights
shall terminate and the only right thereafter of a holder of such Rights shall
be to receive that number of rights in exchange therefor as has been determined
by the Board of Directors in accordance with subsection (e) above. The Company
shall give public notice of any such exchange; provided, however, that the
failure to give, or any defect in, such notice shall not affect the validity of
such exchange. The Company shall mail a notice of any such exchange to all of
the holders of such Rights at their last addresses as they appear upon the
registry books of the transfer agent for the Common Stock of the Company. Any
notice which is mailed in the manner herein provided shall be deemed given,
whether or not the holder receives the notice. Each such notice of exchange will
state the method by which the exchange of the Rights will be effected.

     SECTION 25. NOTICE OF CERTAIN EVENTS.

          (a) In case the Company shall propose, at any time after the
Distribution Date, (i) to pay any dividend payable in stock of any class to the
holders of Preferred Stock or to make any other distribution to the holders of
Preferred Stock (other than a regular cash dividend out of

                                       35
<PAGE>
earnings or retained earnings of the Company), or (ii) to offer to the holders
of Preferred Stock rights or warrants to subscribe for or to purchase any
additional shares of Preferred Stock or shares of stock of any class or any
other securities, rights or options, or (iii) to effect any reclassification of
its Preferred Stock (other than a reclassification involving only the
subdivision of outstanding shares of Preferred Stock), or (iv) to effect any
consolidation or merger into or with any other Person (other than a Subsidiary
of the Company in a transaction which complies with Section 11(o) hereof), or to
effect any sale or other transfer (or to permit one or more of its Subsidiaries
to effect any sale or other transfer), in one transaction or a series of related
transactions, of more than fifty percent (50%) of the assets or earning power of
the Company and its Subsidiaries (taken as a whole) to any other Person or
Persons (other than the Company and/or any of its Subsidiaries in one or more
transactions each of which complies with Section 11(o) hereof), or (v) to effect
the liquidation, dissolution or winding up of the Company, or (vi) to declare or
pay any dividend on the Common Stock payable in Common Stock or to effect a
subdivision, consolidation or combination of the Common Stock (by
reclassification or otherwise than by payment in dividends in Common Stock),
then, in each such case, the Company shall give to the Rights Agent and to the
extent feasible to each holder of a Rights Certificate, in accordance with
Section 26 hereof, a notice of such proposed action, which shall specify the
record date for the purposes of such stock dividend, distribution of rights or
warrants, or the date on which such reclassification, consolidation, merger,
sale, transfer, liquidation, dissolution, or winding up is to take place and the
date of participation therein by the holders of the shares of Preferred Stock,
if any such date is to be fixed, and such notice shall be so given in the case
of any action covered by clause (i) or (ii) above at least ten (10) days prior
to the record date for determining holders of the shares of Preferred Stock for
purposes of such action, and in the case of any such other action, at least ten
(10) days prior to the date of the taking of such proposed action or the date of
participation therein by the holders of the shares of Preferred Stock whichever
shall be the earlier.

          (b) In case any of the events set forth in Section 11(a)(ii) hereof
shall occur, then, in any such case, (i) the Company shall as soon as
practicable thereafter give to the Rights Agent and to each holder of a Rights
Certificate, to the extent feasible and in accordance with Section 26 hereof, a
notice of the occurrence of such event, which shall specify the event and the
consequences of the event to holders of Rights under Section 11(a)(ii) hereof,
and (ii) all references in the preceding paragraph to Preferred Stock shall be
deemed thereafter to refer to Common Stock and/or, if appropriate, other
securities.

     SECTION 26. NOTICES. Notices or demands authorized by this Agreement to be
given or made by the Rights Agent or by the holder of any Rights Certificate to
or on the Company shall be sufficiently given or made if sent by first-class
mail, postage prepaid, addressed (until another address is filed in writing with
the Rights Agent) as follows:

          CKE Restaurants, Inc.
          6307 Carpinteria Avenue, Ste. A
          Carpinteria, California 93013
          Attn: Chief Financial Officer

Subject to the provisions of Section 21, any notice or demand authorized by this
Agreement to be given or made by the Company or by the holder of any Rights
Certificate to or on the Rights Agent shall be sufficiently given or made if
sent by first-class mail, postage prepaid, addressed (until another address is
filed in writing with the Company) as follows:

                                       36
<PAGE>
          Mellon Investor Services LLC
          85 Challenger Road
          Ridgefield Park, New Jersey 07660-2018
          Attn: General Counsel

Notices or demands authorized by this Agreement to be given or made by the
Company or the Rights Agent to the holder of any Rights Certificate (or, if
prior to the Distribution Date, to the holder of certificates representing
shares of Common Stock) shall be sufficiently given or made if sent by
first-class mail, postage prepaid, addressed to such holder at the address of
such holder as shown on the registry books of the Company.

     SECTION 27. SUPPLEMENTS AND AMENDMENTS. This Agreement may be supplemented
or amended at the times and for the purposes set forth below. Prior to the
Distribution Date, the Company and the Rights Agent shall, if the Company so
directs, supplement or amend any provision of this Agreement without the
approval of any holders of certificates representing shares of Common Stock.
From and after the Distribution Date, the Company and the Rights Agent shall, if
the Company so directs, supplement or amend this Agreement without the approval
of any holders of Rights Certificates in order (i) to cure any ambiguity, (ii)
to correct or supplement any provision contained herein which may be defective
or inconsistent with any other provisions herein, (iii) to shorten or lengthen
any time period hereunder, or (iv) to change or supplement the provisions
hereunder in any manner which the Company may deem necessary or desirable and
which shall not adversely affect the interests of the holders of Rights
Certificates (other than an Acquiring Person or an Affiliate or Associate of an
Acquiring Person); provided, however, this Agreement may not be supplemented or
amended to lengthen, pursuant to clause (iii) of this sentence, (A) a time
period relating to when the Rights may be redeemed at such time as the Rights
are not then redeemable, or (B) any other time period unless such lengthening is
for the purpose of protecting, enhancing or clarifying the rights of, and/or the
benefits to, the holders of Rights. Upon the delivery of a certificate from an
appropriate officer of the Company which states that the proposed supplement or
amendment is in compliance with the terms of this Section 27, the Rights Agent
shall execute such supplement or amendment; provided, that, the Rights Agent
may, but shall not be obligated to enter into any supplement or amendment that
effects the Rights Agents' own rights, duties, obligation or immunities under
this Agreement. Prior to the Distribution Date, the interests of the holders of
Rights shall be deemed coincident with the interests of the holders of Common
Stock.

     SECTION 28. SUCCESSORS. All the covenants and provisions of this Agreement
by or for the benefit of the Company or the Rights Agent shall bind and inure to
the benefit of their respective successors and assigns hereunder.

     SECTION 29. DETERMINATIONS AND ACTIONS BY THE BOARD OF DIRECTORS, ETC. For
all purposes of this Agreement, any calculation of the number of shares of
Common Stock outstanding at any particular time, including for purposes of
determining the particular percentage of such outstanding shares of Common Stock
of which any Person is the Beneficial Owner, shall be made in accordance with
the last sentence of Rule 13d-3(d)(1)(i) of the General Rules and Regulations
under the Exchange Act. The Board of Directors of the Company shall have the
exclusive power and authority to administer this Agreement and to exercise all
rights and powers specifically granted to the Board or to the Company, or as may
be necessary or advisable in the administration of this Agreement, including,
without limitation, the right and power to (i) interpret the provisions of this
Agreement, and (ii) make all determinations deemed necessary or advisable for
the administration of

                                       37
<PAGE>
this Agreement (including a determination to redeem or not redeem the Rights or
to amend the Agreement). All such actions, calculations, interpretations and
determinations (including, for purposes of clause (y) below, all omissions with
respect to the foregoing) which are done or made by the Board in good faith,
shall (x) be final, conclusive and binding on the Company, the Rights Agent, the
holders of the Rights and all other parties, and (y) not subject the Board to
any liability to the holders of the Rights. The Rights Agent shall be entitled
to assume the Board of Directors of the Company acted in good faith and shall be
fully protected and incur no liability in the Rights Agent's reliance thereon.

     SECTION 30. BENEFITS OF THIS AGREEMENT. Nothing in this Agreement shall be
construed to give to any person other than the Company, the Rights Agent and the
registered holders of the Rights Certificates (and, prior to the Distribution
Date, registered holders of the Common Stock) any legal or equitable right,
remedy or claim under this Agreement; but this Agreement shall be for the sole
and exclusive benefit of the Company, the Rights Agent and the registered
holders of the Rights Certificates (and, prior to the Distribution Date,
registered holders of the Common Stock).

     SECTION 31. SEVERABILITY. If any term, provision, covenant or restriction
of this Agreement is held by a court of competent jurisdiction or other
authority to be invalid, void or unenforceable, the remainder of the terms,
provisions, covenants and restrictions of this Agreement shall remain in full
force and effect and shall in no way be affected, impaired or invalidated;
provided, however, that notwithstanding anything in this Agreement to the
contrary, if any such term, provision, covenant or restriction is held by such
court or authority to be invalid, void or unenforceable and the Board of
Directors of the Company determines in its good faith judgment that severing the
invalid language from this Agreement would adversely affect the purpose or
effect of this Agreement, the right of redemption set forth in Section 23 hereof
shall be reinstated and shall not expire until the Close of Business on the
tenth day following the date of such determination by the Board of Directors.

     SECTION 32. GOVERNING LAW. This Agreement, each Right and each Rights
Certificate issued hereunder shall be deemed to be a contract made under the
laws of the State of Delaware and for all purposes shall be governed by and
construed in accordance with the laws of such State applicable to contracts made
and to be performed entirely within such State; provided, however, that the
rights and obligations of the Rights Agent shall be governed and construed in
accordance with the laws of the State of New York.

     SECTION 33. COUNTERPARTS. This Agreement may be executed in any number of
counterparts and each such counterpart shall for all purposes be deemed to be an
original, and all such counterparts shall together constitute but one and the
same instrument.

     SECTION 34. DESCRIPTIVE HEADINGS. Descriptive headings of the several
Sections of this Agreement are inserted for convenience only and shall not
control or affect the meaning or construction of any of the provisions hereof.

                                       38
<PAGE>
     IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
duly executed as of the day and year first above written.

                                        CKE RESTAURANTS, INC.,
                                        a Delaware corporation

                                        By: /s/ Andrew F. Puzder
                                            ------------------------------------
                                        Its: President

                                        MELLON INVESTOR SERVICES LLC, as Rights
                                        Agent a New Jersey limited liability
                                        company

                                        By: /s/ John A. Castellanos
                                            ------------------------------------
                                        Its: Vice President
                                             -----------------------------------

                                       39
<PAGE>
                                    EXHIBIT A

       CERTIFICATE OF DESIGNATION OF RIGHTS, PREFERENCES AND PRIVILEGES OF
                  SERIES A JUNIOR PARTICIPATING PREFERRED STOCK

                                       A-1
<PAGE>
                CERTIFICATE OF DESIGNATION OF RIGHTS, PREFERENCES
                                AND PRIVILEGES OF

                  SERIES A JUNIOR PARTICIPATING PREFERRED STOCK

                                       OF

                              CKE RESTAURANTS, INC.

             Pursuant to Section 151 of the General Corporation Law
                            of the State of Delaware

     Andrew F. Puzder, the President and Chief Executive Officer, and Theodore
Abajian, the Executive Vice President and Chief Financial Officer, of CKE
Restaurants, Inc., a corporation organized and existing under the General
Corporation Law of the State of Delaware, in accordance with the provisions of
Section 103 thereof, DO HEREBY CERTIFY:

     That pursuant to the authority conferred upon the Board of Directors by the
Certificate of Incorporation of said Corporation, as amended, the Board of
Directors on October 4, 2005, adopted the following resolution creating a series
of 1,500,000 shares of Preferred Stock designated as Series A Junior
Participating Preferred Stock:

     "RESOLVED, that pursuant to the authority vested in the Board of Directors
of the corporation by the Certificate of Incorporation, the Board of Directors
does hereby provide for the issue of a series of Preferred Stock, $0.01 par
value, of the Corporation, to be designated "Series A Junior Participating
Preferred Stock," initially consisting of 1,500,000 shares and to the extent
that the designations, powers, preferences and relative and other special rights
and the qualifications, limitations and restrictions of the Series A Junior
Participating Preferred Stock are not stated and expressed in the Certificate of
Incorporation, does hereby fix and herein state and express such designations,
powers, preferences and relative and other special rights and the
qualifications, limitations and restrictions thereof, as follows (all terms used
herein which are defined in the Certificate of Incorporation shall be deemed to
have the meanings provided therein):

     Section 1. Designation and Amount. The shares of such series shall be
designated as "Series A Junior Participating Preferred Stock," par value $0.01
per share, and the number of shares constituting such series shall be 1,500,000.

     Section 2. Dividends and Distributions.

          (A) Subject to the prior and superior right of the holders of any
shares of any series of Preferred Stock ranking prior and superior to the shares
of Series A Junior Participating Preferred Stock with respect to dividends, the
holders of shares of Series A Junior Participating Preferred Stock shall be
entitled to receive when, as and if declared by the Board of Directors out of
funds legally available for the purpose, quarterly dividends payable in cash on
the last day of March, June, September and December in each year (each such date
being referred to herein as a "Quarterly Dividend Payment Date"), commencing on
the first Quarterly Dividend Payment Date after the first issuance of a share or
fraction of a share of Series A Junior Participating Preferred Stock, in an
<PAGE>
amount per share (rounded to the nearest cent) equal to, subject to the
provision for adjustment hereinafter set forth, 100 times the aggregate per
share amount of all cash dividends, and 100 times the aggregate per share amount
(payable in kind) of all non-cash dividends or other distributions other than a
dividend payable in shares of Common Stock or a subdivision of the outstanding
shares of Common Stock (by reclassification or otherwise), declared on the
Common Stock of the Corporation (the "Common Stock") since the immediately
preceding Quarterly Dividend Payment Date, or, with respect to the first
Quarterly Dividend Payment Date, since the first issuance of any share or
fraction of a share of Series A Junior Participating Preferred Stock. In the
event the Corporation shall at any time after October 4, 2005 (the "Rights
Declaration Date") (i) declare any dividend on Common Stock payable in shares of
Common Stock, (ii) subdivide the outstanding Common Stock, or (iii) combine the
outstanding Common Stock into a smaller number of shares, then in each such
case, the amount to which holders of shares of Series A Junior Participating
Preferred Stock were entitled immediately prior to such event under the
preceding sentence shall be adjusted by multiplying such amount by a fraction,
the numerator of which is the number of shares of Common Stock outstanding
immediately after such event and the denominator of which is the number of
shares of Common Stock that were outstanding immediately prior to such event.

          (B) The Corporation shall declare a dividend or distribution on the
Series A Junior Participating Preferred Stock as provided in paragraph (A) above
immediately after it declares a dividend payable in shares of Common Stock.

          (C) Dividends shall begin to accrue and be cumulative on outstanding
shares of Series A Junior Participating Preferred Stock from the Quarterly
Dividend Payment Date next preceding the date of issue of such shares of Series
A Junior Participating Preferred Stock, unless the date of issue of such shares
is prior to the record date for the first Quarterly Dividend Payment Date, in
which case dividends on such shares shall begin to accrue from the date of issue
of such shares, or unless the date of issue is a Quarterly Dividend Payment Date
or is a date after the record date for the determination of holders of shares of
Series A Junior Participating Preferred Stock entitled to receive a quarterly
dividend and before such Quarterly Dividend Payment Date, in either of which
events such dividends shall begin to accrue and be cumulative from such
Quarterly Dividend Payment Date. Accrued but unpaid dividends shall not bear
interest. Dividends paid on the shares of Series A Junior Participating
Preferred Stock in an amount less than the total amount of such dividends at the
time accrued and payable on such shares shall be allocated pro rata on a
share-by-share basis among all such shares at the time outstanding. The Board of
Directors may fix a record date for the determination of holders of shares of
Series A Junior Participating Preferred Stock entitled to receive payment of a
dividend or distribution declared thereon, which record date shall be no more
than thirty (30) days prior to the date fixed for the payment thereof.

     Section 3. Voting Rights. The holders of shares of Series A Junior
Participating Preferred Stock shall have the following voting rights:

          (A) Subject to the provision for adjustment hereinafter set forth,
each share of Series A Junior Participating Preferred Stock shall entitle the
holder thereof to 100 votes on all matters submitted to a vote of the
stockholders of the Corporation. In the event the Corporation shall at any time
after the Rights Declaration Date (i) declare any dividend on Common Stock
payable in shares of Common Stock, (ii) subdivide the outstanding Common Stock,
or (iii) combine the outstanding Common Stock into a smaller number of shares,
then in each such case the number of votes per share to which holders of shares
of Series A Junior Participating Preferred Stock were

                                        2
<PAGE>
entitled immediately prior to such event shall be adjusted by multiplying such
number by a fraction, the numerator of which is the number of shares of Common
Stock outstanding immediately after such event and the denominator of which is
the number of shares of Common Stock that were outstanding immediately prior to
such event.

          (B) Except as otherwise provided herein or by law, the holders of
shares of Series A Junior Participating Preferred Stock and the holders of
shares of Common Stock shall vote together as one class on all matters submitted
to a vote of stockholders of the Corporation.

          (C) Except as required by law, holders of Series A Junior
Participating Preferred Stock shall have no special voting rights and their
consent shall not be required (except to the extent they are entitled to vote
with holders of Common Stock as set forth herein) for taking any corporate
action.

     Section 4. Certain Restrictions.

          (A) The Corporation shall not declare any dividend on, make any
distribution on, or redeem or purchase or otherwise acquire for consideration
any shares of Common Stock after the first issuance of a share or fraction of a
share of Series A Junior Participating Preferred Stock unless concurrently
therewith it shall declare a dividend on the Series A Junior Participating
Preferred Stock as required by Section 2 hereof.

          (B) Whenever quarterly dividends or other dividends or distributions
payable on the Series A Junior Participating Preferred Stock as provided in
Section 2 are in arrears, thereafter and until all accrued and unpaid dividends
and distributions, whether or not declared, on shares of Series A Junior
Participating Preferred Stock outstanding shall have been paid in full, the
Corporation shall not:

               (i) declare or pay dividends on, make any other distributions on,
or redeem or purchase or otherwise acquire for consideration any shares of stock
ranking junior (either as to dividends or upon liquidation, dissolution or
winding up) to the Series A Junior Participating Preferred Stock;

               (ii) declare or pay dividends on, make any other distributions on
any shares of stock ranking on a parity (either as to dividends or upon
liquidation, dissolution or winding up) with Series A Junior Participating
Preferred Stock, except dividends paid ratably on the Series A Junior
Participating Preferred stock and all such parity stock on which dividends are
payable or in arrears in proportion to the total amounts to which the holders of
all such shares are then entitled;

               (iii) redeem or purchase or otherwise acquire for consideration
shares of any stock ranking on a parity (either as to dividends or upon
liquidation, dissolution or winding up) with the Series A Junior Participating
Preferred Stock, provided that the Corporation may at any time redeem purchase
or otherwise acquire shares of any such parity stock in exchange for shares of
any stock of the Corporation ranking junior (either as to dividends or upon
dissolution, liquidation or winding up) to the Series A Junior Participating
Preferred Stock; or

               (iv) purchase or otherwise acquire for consideration any shares
of Series A Junior Participating Preferred Stock, or any shares of stock ranking
on a parity with the Series A

                                        3
<PAGE>
Junior Participating Preferred Stock, except in accordance with a purchase offer
made in writing or by publication (as determined by the Board of Directors) to
all holders of such shares upon such terms as the Board of Directors, after
consideration of the respective annual dividend rates and other relative rights
and preferences of the respective series and classes, shall determine in good
faith will result in fair and equitable treatment among the respective series or
classes.

          (C) The Corporation shall not permit any subsidiary of the Corporation
to purchase or otherwise acquire for consideration any shares of stock of the
Corporation unless the Corporation could, under paragraph (A) of this Section 4,
purchase or otherwise acquire such shares at such time and in such manner.

     Section 5. Reacquired Shares. Any shares of Series A Junior Participating
Preferred Stock purchased or otherwise acquired by the Corporation in any manner
whatsoever shall be retired and cancelled promptly after the acquisition
thereof. All such shares shall upon their cancellation become authorized but
unissued shares of Preferred Stock and may be reissued as part of a new series
of Preferred Stock to be created by resolution or resolutions of the Board of
Directors, subject to the conditions and restrictions on issuance set forth
herein.

     Section 6. Liquidation, Dissolution or Winding Up.

          (A) Upon any liquidation (voluntary or otherwise), dissolution or
winding up of the Corporation, no distribution shall be made to the holders of
shares of stock ranking junior (either as to dividends or upon liquidation,
dissolution or winding up) to the Series A Junior Participating Preferred Stock
unless, prior thereto, the holders of shares of Series A Junior Participating
Preferred Stock shall have received an amount equal to accrued and unpaid
dividends and distributions thereon, whether or not declared, to the date of
such payment, plus an amount equal to the greater of (1) $100.00 per share,
provided that in the event the Corporation does not have sufficient assets,
after payment of its liabilities and distribution to holders of Preferred Stock
ranking prior to the Series A Junior Participating Preferred Stock, available to
permit payment in full of the $100.00 per share amount, the amount required to
be paid under this Section 6(A)(1) shall, subject to Section 6(B) hereof, equal
the value of the amount of available assets divided by the number of outstanding
shares of Series A Junior Participating Preferred Stock or (2) subject to the
provisions for adjustment hereinafter set forth, 100 times the aggregate per
share amount to be distributed to the holders of Common Stock (the greater of
(1) or (2), the "Series A Liquidation Preference"). In the event the Corporation
shall at any time after the Rights Declaration Date (i) declare any dividend on
Common Stock payable in shares of Common Stock, (ii) subdivide the outstanding
Common Stock, or (iii) combine the outstanding Common Stock into a smaller
number of shares, then in each such case the amount to which holders of shares
of Series A Junior Participating Preferred Stock were entitled immediately prior
to such event under clause (2) of the preceding sentence shall be adjusted by
multiplying such amount by a fraction the numerator of which is the number of
shares of Common Stock that were outstanding immediately after such event and
the denominator of which is the number of shares of Common Stock that were
outstanding immediately prior to such event.

          (B) In the event, however, that there are not sufficient assets
available to permit payment in full of the Series A Liquidation Preference and
the liquidation preferences of all other series of Preferred Stock, if any,
which rank on a parity with the Series A Junior Participating Preferred Stock,
then such remaining assets shall be distributed ratably to the holders of such
parity shares in proportion to their respective liquidation preferences.

                                        4
<PAGE>
     Section 7. Consolidation, Merger, etc. In case the Corporation shall enter
into any consolidation, merger, combination or other transaction in which the
shares of Common Stock are exchanged for or changed into other stock or
securities, cash and/or any other property, then in any such case the shares of
Series A Junior Participating Preferred Stock shall at the same time be
similarly exchanged or changed in amount per share (subject to the provision for
adjustment hereinafter set forth) equal to 100 times the aggregate amount of
stock, securities, cash and/or any other property (payable in kind), as the case
may be, into which or for which each share of Common Stock is changed or
exchanged. In the event the Corporation shall at any time after the Rights
Declaration Date (i) declare any dividend on Common Stock payable in shares of
Common Stock, (ii) subdivide the outstanding Common Stock, or (iii) combine the
outstanding Common Stock into a smaller number of shares, then in each such case
the amount set forth in the preceding sentence with respect to the exchange or
change of shares of Series A Junior Participating Preferred Stock shall be
adjusted by multiplying such amount by a fraction the numerator of which is the
number of shares of Common Stock outstanding immediately after such event and
the denominator of which is the number of shares of Common Stock that were
outstanding immediately prior to such event.

     Section 8. Redemption. The shares of Series A Junior Participating
Preferred Stock shall not be redeemable.

     Section 9. Ranking. The Series A Junior Participating Preferred Stock shall
rank junior to all other series of the Corporation's Preferred Stock as to the
payment of dividends and the distribution of assets, unless the terms of any
such series shall provide otherwise. The Series A Junior Participating Preferred
Stock shall rank senior to the Corporation's Common Stock.

     Section 10. Amendment. The Certificate of Incorporation of the Corporation
shall not be further amended in any manner which would materially alter or
change the powers, preference or special rights of the Series A Junior
Participating Preferred Stock so as to affect them adversely without the
affirmative vote of the holders of a majority or more of the outstanding shares
of Series A Junior Participating Preferred Stock, voting separately as a class.

     Section 11. Fractional Shares. Series A Junior Participating Preferred
Stock may be issued in fractions of a share which shall entitle the holder, in
proportion to such holder's fractional shares, to exercise voting rights,
receive dividends, participate in distributions and to have the benefit of all
other rights of holders of Series A Junior Participating Preferred Stock.

                                        5
<PAGE>
     IN WITNESS WHEREOF, we have executed and subscribed this Certificate and do
affirm the foregoing as true under the penalties of perjury this 10th day of
October, 2005.

                                        /S/ ANDREW F. PUZDER
                                        ----------------------------------------
                                        Andrew F. Puzder
                                        President and Chief Executive Officer

                                        /S/ THEODORE ABAJIAN
                                        ----------------------------------------
                                        Theodore Abajian
                                        Executive Vice President and
                                        Chief Financial Officer

                                        6
<PAGE>
                                    EXHIBIT B

                           FORM OF RIGHTS CERTIFICATE

                                       B-1
<PAGE>
                                    EXHIBIT B
                           Form of Rights Certificate

Certificate No. R-____________                                  _________ Rights

     NOT EXERCISABLE AFTER DECEMBER 31, 2008, OR EARLIER IF TERMINATED BY THE
     COMPANY OR AS OTHERWISE PROVIDED IN THE RIGHTS AGREEMENT. THE RIGHTS ARE
     SUBJECT TO REDEMPTION, AT THE OPTION OF THE COMPANY, AT $0.01 PER RIGHT ON
     THE TERMS SET FORTH IN THE RIGHTS AGREEMENT. [UNDER CERTAIN CIRCUMSTANCES,
     RIGHTS BENEFICIALLY OWNED BY AN ACQUIRING PERSON OR AN AFFILIATE OR
     ASSOCIATE OF AN ACQUIRING PERSON (AS SUCH TERMS ARE DEFINED IN THE RIGHTS
     AGREEMENT) AND ANY SUBSEQUENT HOLDER OF SUCH RIGHTS MAY BECOME NULL AND
     VOID.] [THE RIGHTS REPRESENTED BY THIS RIGHTS CERTIFICATE ARE OR WERE
     BENEFICIALLY OWNED BY A PERSON WHO WAS OR BECAME AN ACQUIRING PERSON OR AN
     AFFILIATE OR ASSOCIATE OF AN ACQUIRING PERSON (AS SUCH TERMS ARE DEFINED IN
     THE RIGHTS AGREEMENT). ACCORDINGLY, THIS RIGHTS CERTIFICATE AND THE RIGHTS
     REPRESENTED HEREBY MAY BECOME NULL AND VOID IN THE CIRCUMSTANCES SPECIFIED
     IN SECTION 7(e) OF SUCH RIGHTS AGREEMENT.]*

                               RIGHTS CERTIFICATE
                              CKE RESTAURANTS, INC.

     This certifies that _______________________________, or registered assigns,
is the registered owner of the number of Rights set forth above, each of which
entitles the owner thereof, subject to the terms, provisions and conditions of
the Rights Agreement, dated as of October 10, 2005, as such agreement may be
amended from time to time in accordance with its terms (the "Rights Agreement"),
between CKE Restaurants, Inc, a Delaware corporation (the "Company"), and Mellon
Investor Services LLC, a New Jersey limited liability company (the "Rights
Agent"), to purchase from the Company at any time after the Distribution Date
(as such term is defined in the Rights Agreement) and prior to 5:00 P.M., New
York Time, on December 31, 2008, at the office of the Rights Agent designated
for such purpose, or at the office of its successor as Rights Agent, one
one-hundredth of a fully paid non-assessable share of Series A Junior
Participating Preferred Stock, $0.01 par value (the "Preferred Shares"), of the
Company, at a purchase price of $22.00 per one one-hundredth of a Preferred
Share (the "Purchase Price"), upon presentation and surrender of this Rights
Certificate with the form of Election to Purchase and related Certificate duly
executed. The number of Rights evidenced by this Rights Certificate (and the
number of one one-hundredths of a Preferred Share which may be purchased upon
exercise hereof) set forth above, are the number and Purchase Price as of
October 17, 2005, based on the Preferred Shares as constituted at such date. As
provided in the Rights Agreement, the Purchase Price and the number and kind of
Preferred Shares or other securities which may be purchased upon the exercise of
the Rights evidenced by this Rights Certificate are subject to modification and
adjustment upon the happening of certain events.

     This Rights Certificate is subject to all of the terms, provisions and
conditions of the Rights Agreement, which terms, provisions and conditions are
hereby incorporated herein by reference and made a part hereof and to which
Rights Agreement reference is hereby made for a full description of the rights,
limitations of rights, obligations, duties and immunities hereunder of the
Rights Agent, the

----------
*    The portion of the legend in bracket shall be inserted only if applicable
     and shall replace the preceding sentence.
<PAGE>
Company and the holders of the Rights Certificates, which limitations of rights
include the temporary suspension of the exercisability of such Rights under the
specific circumstances set forth in the Rights Agreement. Copies of the Rights
Agreement are on file at the principal executive offices of the Company and the
above-mentioned office of the Rights Agent.

     Subject to the provisions of the Rights Agreement, the Rights evidenced by
this Rights Certificate (i) may be redeemed by the Company, at its option, at a
redemption price of $0.01 per Right or (ii) may be exchanged by the Company in
whole or in part for Common Shares, substantially equivalent rights or other
consideration as determined by the Company.

     This Rights Certificate, with or without other Rights Certificates, upon
surrender at the office of the Rights Agent designated for such purpose may be
exchanged for another Rights Certificate or Rights Certificates of like tenor
and date evidencing Rights entitling the holder to purchase a like aggregate
amount of securities as the Rights evidenced by the Rights Certificate or Rights
Certificates surrendered shall have entitled such holder to purchase. If this
Rights Certificate shall be exercised in part, the holder shall be entitled to
receive upon surrender hereof another Rights Certificate or Rights Certificates
for the number of whole Rights not exercised.

     No fractional portion less than integral multiples of one one-hundredth of
a Preferred Share will be issued upon the exercise of any Right or Rights
evidenced hereby but in lieu thereof a cash payment will be made, as provided in
the Rights Agreement.

     No holder of this Rights Certificate, as such, shall be entitled to vote or
receive dividends or be deemed for any purpose the holder of the Preferred
Shares or any other securities of the Company which may at any time be issuable
on the exercise hereof, nor shall anything contained in the Rights Agreement or
herein be construed to confer upon the holder hereof, as such, any of the rights
of a stockholder of the Company or any right to vote for the election of
directors or upon any matter submitted to stockholders at any meeting thereof,
or to give or withhold consent to any corporate action, or to receive notice of
meetings or other actions affecting stockholders (except as provided in the
Rights Agreement), or to receive dividends or subscription rights, or otherwise,
until the Right or Rights evidenced by this Rights Certificate shall have been
exercised as provided in the Rights Agreement.

     The Rights Certificate shall not be valid or obligatory for any purpose
until it shall have been countersigned by the Rights Agent.

                                        2
<PAGE>
     WITNESS the facsimile signature of the proper officers of the Company and
its corporate seal. Dated as of _____________, 200_.

ATTEST:                                 CKE RESTAURANTS, INC.

                                        By:
-------------------------------------       ------------------------------------
[Secretary]

Countersigned:

-------------------------------------
as Rights Agent

By:
    ---------------------------------
    Authorized Officer

                                        3
<PAGE>
                   Form of Reverse Side of Rights Certificate

                               FORM OF ASSIGNMENT

                (To be executed by the registered holder if such
               holder desires to transfer the Rights Certificate)

     FOR VALUE RECEIVED ____________________________________________________
hereby sells, assigns and transfers unto

________________________________________________________________________________
                  (Please print name and address of transferee)

this Rights Certificate, together with all right, title and interest therein,
and does hereby irrevocably constitute and appoint _____________________________
_______________________________________________ Attorney, to transfer the within
Rights Certificate on the books of the within-named Company, with full power of
substitution.

Dated:
       ------------------------------

                                        ----------------------------------------
                                        Signature

Signature Guaranteed:

     The signature should be guaranteed by an eligible guarantor institution
(banks, stock brokers, savings and loan associations and credit unions with
members in an approved signature guarantee medallion program) pursuant to Rule
17Ad-15 under the Securities Exchange Act of 1934, as amended.

                                       4
<PAGE>
                                   CERTIFICATE

     The undersigned hereby certifies by checking the appropriate boxes that:

          (1) this Rights Certificate [ ] is [ ] is not being sold, assigned and
transferred by or on behalf of a Person who is or was an Acquiring Person, or an
Affiliate or Associate of any such Person (as such terms are defined in the
Rights Agreement);

          (2) after due inquiry and to the best knowledge of the undersigned, it
[ ] did [ ] did not acquire the Rights evidenced by this Rights Certificate from
any Person who is, was or subsequently became an Acquiring Person or an
Affiliate or Associate of any such Person.

Dated:
       ------------------------------

                                        ----------------------------------------
                                        Signature

Signature Guaranteed:

     The signature should be guaranteed by an eligible guarantor institution
(banks, stock brokers, savings and loan associations and credit unions with
members in an approved signature guarantee medallion program) pursuant to Rule
17Ad-15 under the Securities Exchange Act of 1934, as amended.

                                       5
<PAGE>
Form of Reverse Side of Rights Certificate -- continued

                          FORM OF ELECTION TO PURCHASE

      (To be executed if holder desires to exercise the Rights Certificate)

To: _____________________________________________________

     The undersigned hereby irrevocable elects to exercise __________________
Rights represented by this Rights Certificate to purchase the number of one
one-hundredths of a Preferred Share issuable upon the exercise of such Rights
and requests that certificates for such number of one one-hundredths of a
Preferred Share be issued in the name of:

Please insert social security or other identifying number ______________________

             ______________________________________________________
             ______________________________________________________
             ______________________________________________________
                         (Please print name and address)

If such number of Rights shall not be all the Rights evidenced by this Rights
Certificate, a new Rights Certificate for the balance remaining of such Rights
shall be registered in the name of and delivered to:

Please insert social security or other identifying number ______________________

             ______________________________________________________
             ______________________________________________________
             ______________________________________________________
                         (Please print name and address)

Dated:
       ------------------------------

                                        ----------------------------------------
                                        Signature

Signature Guaranteed:

     The signature should be guaranteed by an eligible guarantor institution
(banks, stock brokers, savings and loan associations and credit unions with
members in an approved signature guarantee medallion program) pursuant to Rule
17Ad-15 under the Securities Exchange Act of 1934, as amended.

                                       6
<PAGE>
                                   CERTIFICATE

     The undersigned hereby certifies by checking the appropriate boxes that:

          (1) this Rights Certificate [ ] is [ ] is not being sold, assigned and
transferred by or on behalf of a Person who is or was an Acquiring Person, or an
Affiliate or Associate of any such Person (as such terms are defined in the
Rights Agreement);

          (2) after due inquiry and to the best knowledge of the undersigned, it
[ ] did [ ] did not acquire the Rights evidenced by this Rights Certificate from
any Person who is, was or subsequently became an Acquiring Person or an
Affiliate or Associate of any such Person.

Dated:
       ------------------------------

                                        ----------------------------------------
                                        Signature

Signature Guaranteed:

     The signature should be guaranteed by an eligible guarantor institution
(banks, stock brokers, savings and loan associations and credit unions with
members in an approved signature guarantee medallion program) pursuant to Rule
17Ad-15 under the Securities Exchange Act of 1934.

                                       7
<PAGE>
             Form of Reverse Side of Rights Certificate -- continued

                                     NOTICE

     The signature in the foregoing Forms of Assignment and Election must
conform to the name as written upon the face of this Rights Certificate in every
particular, without alteration or enlargement or any change whatsoever.

     In the event the certification set forth on the foregoing Form of
Assignment or the Form of Election to Purchase, as the case may be, is not
completed, the Company and the Rights Agent will deem the beneficial owner of
the Rights evidenced by the Rights Certificate to be an Acquiring Person or an
Affiliate or Associate thereof (as defined in the Rights Agreement) and such
Assignment or Election to Purchase will not be honored.

                                       8
<PAGE>
                                    EXHIBIT C

                                SUMMARY OF RIGHTS

                                       C-1
<PAGE>
                              CKE RESTAURANTS, INC.
                  SUMMARY OF RIGHTS TO PURCHASE PREFERRED STOCK

     On October 4, 2005, the Board of Directors of CKE Restaurants, Inc. (the
"Corporation") approved the adoption of a Stockholder Rights Plan and declared a
dividend distribution of one right (a "Right") for each outstanding share of the
Corporation's Common Stock to stockholders of record at the close of business on
October 17, 2005 (the "Dividend Date"). Each Right entitles the registered
holder to purchase from the Corporation a unit consisting of one one-hundredth
of a share (a "Unit") of Series A Junior Participating Preferred Stock, $0.01
par value (the "Preferred Stock"), at a purchase price of $22.00 per Unit,
subject to adjustment. The description and terms of the Rights are set forth in
a Rights Agreement between the Corporation and Mellon Investor Services LLC, a
New Jersey limited liability company, as Rights Agent, dated as of October 10,
2005,as may be amended, restated or otherwise modified from time to time (the
"Rights Agreement").

     Certificates. Initially, the Rights will not be exercisable, the Rights
will be attached to all Common Stock certificates representing shares then
outstanding, and no separate Rights Certificates will be distributed. Subject to
extension by the Board of Directors in certain circumstances, the Rights will
separate from the Common Stock and a distribution date (the "Distribution Date")
will occur upon the earlier of (i) ten (10) days following a public announcement
that a person or group of affiliated or associated persons (an "Acquiring
Person") has acquired, or obtained the right to acquire, beneficial ownership of
fifteen percent (15%) or more of the outstanding shares of Common Stock (the
"Stock Acquisition Date"), or (ii) ten (10) business days following the
commencement of a tender offer or exchange offer that would result in a person
or group beneficially owning fifteen percent (15%) or more of the outstanding
shares of Common Stock. Until the Distribution Date, (i) the Rights will be
evidenced by the Common Stock certificates and will be transferred with and only
with such Common Stock certificates, (ii) new Common Stock certificates issued
will contain a notation incorporating the Rights Agreement by reference, and
(iii) the surrender for transfer of any certificates for Common Stock
outstanding will also constitute the transfer of the Rights associated with the
Common Stock represented by such certificate.

     Expiration and Exercise. The Rights are not exercisable until the
Distribution Date and will expire at the close of business on December 31, 2008
(or December 31, 2006 if stockholder approval for the Rights Agreement has not
been received by December 31, 2006), unless previously redeemed or exchanged by
the Corporation (including by stockholder action in connection with a "Qualified
Offer" as defined in the Rights Agreement) as described below.

     As soon as practicable after the Distribution Date, Rights Certificates
will be mailed to holders of record of the Common Stock as of the close of
business on the Distribution Date and, thereafter, the separate Rights
Certificates alone will represent the Rights. Except as otherwise determined by
the Board of Directors, only shares of Common Stock issued prior to the
Distribution Date will be issued with Rights.

     "Flip-In". In the event that (i) the Corporation is the surviving
corporation in a merger with an Acquiring Person and its Common Stock is not
changed or exchanged, (ii) an Acquiring Person becomes the beneficial owner of
more than fifteen percent (15%) of the outstanding shares of Common Stock, (iii)
an Acquiring Person engages in one or more "self-dealing" transactions as set
<PAGE>
forth in the Rights Agreement, or (iv) during such time as there is an Acquiring
Person, an event occurs which results in such Acquiring Person's ownership
interest being increased by more than one percent (1%) (e.g., a reverse stock
split), each holder of a Right will thereafter have the right to receive, upon
exercise, Common Stock (or, in certain circumstances, cash, property or other
securities of the Corporation) having a value equal to two (2) times the
exercise price of the Right. However, the Rights are not exercisable following
the occurrence of any of the events set forth above until such time as the
Rights are no longer redeemable as set forth below. Notwithstanding any of the
foregoing, following the occurrence of any of the events set forth in this
paragraph, all Rights that are, or (under certain circumstances specified in the
Rights Agreement) were, beneficially owned by any Acquiring Person will become
null and void.

     For example, at an exercise price of $20 per Right, each Right not owned by
an Acquiring Person (or by certain related parties) following an event set forth
in the preceding paragraph would entitle its holder to purchase $40 worth of
Common Stock (or other consideration, as noted above) for $20. Assuming that the
Common Stock had a per share value of $10 at such time, the holder of each valid
Right would be entitled to purchase 4 shares of Common Stock for $20.

     "Flip-Over". In the event that, at any time following the Stock Acquisition
Date, (i) the Corporation is acquired in a merger or other business combination
transaction in which the Corporation is not the surviving corporation, or (ii)
fifty percent (50%) or more of the Corporation's assets or earning power is sold
or transferred, each holder of a Right (except Rights which previously have been
voided as set forth above) shall thereafter have the right to receive, upon
exercise, common stock of the acquiring company having a value equal to two (2)
times the exercise price of the Right.

     Exchange Feature. At any time after any person becomes an Acquiring Person
and prior to the acquisition by such person or group of fifty percent (50%) or
more of the outstanding Common Stock, the Board of Directors may exchange the
Rights (other than Rights owned by such person or group which will have become
void), in whole or in part, at an exchange rate of one share of Common Stock (or
a combination of cash, property, Common Stock or other securities having an
equal value) per Right (subject to adjustment).

     Adjustment for Dilution. The purchase price payable, and the number of
Units of Preferred Stock or other securities or property issuable upon exercise
of the Rights, are subject to adjustment from time to time to prevent dilution
(i) in the event of a stock dividend on, or a subdivision, combination or
reclassification of, the Preferred Stock, (ii) if holders of the Preferred Stock
are granted certain rights or warrants to subscribe for Preferred Stock or
convertible securities at less than the current market price of the Preferred
Stock, or (iii) upon the distribution to holders of the Preferred Stock of
evidences of indebtedness or assets (excluding regular cash dividends) or of
subscription rights or warrants (other than those referred to above).

     With certain exceptions, no adjustment in the purchase price will be
required until cumulative adjustments amount to at least one percent (1%) of the
purchase price. No fractional Units will be issued and, in lieu thereof, an
adjustment in cash will be made based on the market price of the Preferred Stock
on the last trading date prior to the date of exercise.

                                       2
<PAGE>
     Redemption. At any time until ten (10) days following the Stock Acquisition
Date or such later date as may be determined by action of the Board of Directors
then in office and publicly announced by the Corporation, the Corporation may
redeem the Rights in whole, but not in part, at a price of $0.01 per Right (the
"Redemption Price"). Immediately upon the action of the Board of Directors
ordering redemption of the Rights, the Rights will terminate and the only right
of the holders of Rights will be to receive the Redemption Price. However, in
the event that the Company receives a Qualified Offer, the rights may be
redeemed by way of a stockholder action taken at a special meeting of
stockholders called by the Board of Directors for the purpose of voting on a
resolution accepting the Qualified Offer and authorizing the redemption of the
Rights pursuant to the provisions of the Rights Agreement. The special meeting
must be held not less than ninety (90) and not more than one hundred twenty
(120) days after the date the Qualified Offer is received. This 120-day deadline
may be extended if required at that time to satisfy any then outstanding
regulatory or information delivery requirements. Such an action by stockholders
requires the affirmative vote of at least a majority of all outstanding shares
of Common Stock entitled to vote as of the record date of the special meeting,
and is effective immediately prior to the consummation of any Qualified Offer
consummated within sixty (60) days after the special meeting. A "Qualified
Offer" is a tender offer for all outstanding shares of Common Stock not already
beneficially owned by the person making the Qualified Offer that meets all of
the following conditions:

     -    the same per share price and consideration is offered for all shares
          of Common Stock, is at least eighty percent (80%) cash (and any
          non-cash portion is comprised of shares listed on a national exchange
          or the Nasdaq National Market System), and is to be paid upon
          consummation of the Qualified Offer;

     -    the offering person has on hand cash or cash equivalents for the full
          amount necessary to consummate the Qualified Offer, or has all
          financing in the full amount necessary to consummate the Qualified
          Offer, and has entered into definitive financing agreements;

     -    the offering person requests that the Corporation call a special
          meeting of stockholders to accept the Qualified Offer and to authorize
          the redemption of the Rights, and contains a written agreement of the
          person making the Qualified Offer to pay at least one-half (1/2) the
          Corporation's costs of such special meeting;

     -    the Qualified Offer by its terms remains open for at least sixty (60)
          business days and at least fifteen (15) additional business days after
          any change in price or after any bona fide alternative offer for a
          higher consideration is made;

     -    the Qualified Offer is accompanied by a written opinion of a
          nationally recognized investment banking firm, stating that the price
          to be paid to stockholders pursuant to the Qualified Offer is fair
          from a financial point of view to such stockholders and including any
          written presentation of such firm showing the analysis and range of
          values underlying such conclusion;

     -    on or before the date the Qualified Offer is commenced, the offering
          person makes an irrevocable written commitment to the Corporation:

                                       3
<PAGE>
     -    to acquire, within five (5) business days upon completion of the
          Qualified Offer, all shares of Common Stock then not beneficially
          owned by such person at the same price, and for the same
          consideration, per share as paid in the Qualified Offer;

     -    not to amend its offer to reduce the per share price, to change the
          form of consideration offered, or to reduce the number of shares being
          sought;

     -    if the Qualified Offer is not consummated, that such person will not
          make another offer for the Common Stock within one (1) year if at
          least eighty-five percent (85%) of the common stock not owned by such
          person has not been tendered in the Qualified Offer; and

     -    the Qualified Offer is not subject to any financing, funding or
          similar condition, does not include any condition relating to
          completion of or satisfaction with any due diligence or similar
          investigation, and otherwise provides for usual and customary terms
          and conditions.

     Stockholder Rights. Until a Right is exercised, the holder thereof, as
such, will have no rights as a stockholder of the Corporation, including,
without limitation, the right to vote or to receive dividends. While the
distribution of the Rights will not be taxable to stockholders or to the
Corporation, stockholders may, depending upon the circumstances, recognize
taxable income in the event that the Rights become exercisable for Common Stock
(or other consideration) of the Corporation or for common stock of the acquiring
company as set forth above.

     Amendments. Any of the provisions of the Rights Agreement may be amended by
the Board of Directors prior to the Distribution Date. After the Distribution
Date, the provisions of the Rights Agreement may be amended by the Board of
Directors in order to cure any ambiguity, to make changes which do not adversely
affect the interests of holders of Rights (excluding the interests of any
Acquiring Person), or to shorten or lengthen any time period under the Rights
Agreement; provided, however, that no amendment to adjust the time period
governing redemption shall be made at such time as the Rights are not
redeemable.

     Availability of Rights Agreement. A copy of the Rights Agreement has been
filed with the Securities and Exchange Commission as an Exhibit to Registration
Statement on Form 8-A dated October 11, 2005. A copy of the Rights Agreement is
available free of charge from the Corporation. This Summary of Rights does not
purport to be complete and is qualified in its entirety by reference to the
Rights Agreement, which is incorporated herein by reference.

                                       4

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