Document:

WWW.EXFILE.COM  888.775-4789    GLOBAL MATRECHS, INC.   EXHIBIT 10.2 TO FORM 8K

    EXHIBIT
      10.2

     

    REGISTRATION
      RIGHTS AGREEMENT 

     

    This
      Registration Rights Agreement ("Agreement"),
      dated
      as of September 15, 2006, is made by and between GLOBAL MATRECHS, INC., a
      Delaware corporation ("Company"),
      and
      BRITTANY CAPITAL MANAGEMENT LTD, a Bahamian corporation (the "Subscriber").
      

     

    RECITALS
      

     

    WHEREAS,
      upon the terms and subject to the conditions of the Private Equity Credit
      Agreement (the "Equity
      Credit Agreement"),
      between the Subscriber and the Company, the Company has agreed to issue and
      sell
      to the Subscriber up to Fifteen Million Dollars ($15,000,000) of the common
      stock of the Company ("Subscribed
      Shares"),
      $.01
      par value per share (the "Common
      Stock"),
      and

     

    WHEREAS,
      to induce the Subscriber to execute and deliver the Equity Credit Agreement,
      the
      Company has agreed to provide certain registration rights under the Securities
      Act of 1933, as amended, and the rules and regulations thereunder, or any
      similar successor statute (collectively, the "Securities
      Act"),
      and
      applicable state securities laws with respect to the Subscribed Shares;

     

    NOW,
      THEREFORE, in consideration of the premises and the mutual covenants contained
      herein and other good and valuable consideration, the receipt and sufficiency
      of
      which are hereby acknowledged, the Company and the Subscriber hereby agree
      as
      follows: 

     

    1.     DEFINITIONS.
      

     

    (a)
      As
      used in this Agreement, the following terms shall have the following meaning:
      

     

    (i)
      "Potential
      Material Event"
      means
      any of the following: (A) the possession by the Company of material information
      not ripe for disclosure in a Registration Statement, which shall be evidenced
      by
      determinations in good faith by the Board of Directors of the Company that
      disclosure of such information in the Registration Statement would be
      detrimental to the business and affairs of the Company, or (B) any material
      engagement or activity by the Company which would, in the good faith
      determination of the Board of Directors of the Company, be adversely affected
      by
      disclosure in a Registration Statement at such time, which determination shall
      be accompanied by a good faith determination by the Board of Directors of the
      Company that the Registration Statement would be materially misleading absent
      the inclusion of such information. 

     

    (ii)
      "Prospectus"
      means
      the prospectus included in the Registration Statement (including, without
      limitation, a prospects that includes any information previously omitted from
      a
      prospectus filed as part of an effective registration statement in reliance
      upon
      Rule 430A promulgated under the Securities Act), as amended or supplemented
      by
      any prospectus supplement, with respect to the terms of the offering of any
      portion of the Registrable Securities covered by the Registration Statement,
      and
      all other amendments and supplements to the prospectus, including post-effective
      amendments, and all material incorporated by reference in such prospectus.
      

     

    (iii)
      "Register,"
      "registered"
      and
      "registration"
      refer
      to a registration effected by preparing and filing a Registration Statement
      or
      Statements in compliance with the Securities 

     

    
      
         

      

      
         

        
          

        

      

      
         

      

    

    Act
      and
      pursuant to Rule 415 under the Securities Act or any successor rule providing
      for offering securities on a delayed or continuous basis ("Rule
      415"),
      and
      the declaration or ordering of effectiveness of such Registration Statement
      by
      the United States Securities and Exchange Commission (the "SEC").
      

     

    (iv)
      "Registrable
      Securities"
      means
      the Subscribed Shares. 

     

    (v)
      "Registration
      Statement"
      means a
      registration statement of the Company under the Securities Act. 

     

    (vi)
      "Subscription
      Date"
      means
      the date of this Agreement. 

     

    (vii)
      "Subscriber"
      has the
      meaning set forth in the preamble to this Agreement. 

     

    (b)
      Capitalized terms used herein and not otherwise defined herein shall have the
      respective meanings set forth in the Equity Credit Agreement. 

     

     

    2.     REGISTRATION.
      

     

    (A)
      MANDATORY REGISTRATION. The Company shall prepare and file with the SEC, no
      later than thirty (30) business days from the date of this Agreement
      ("Filing
      Date"),
      a
      Registration Statement registering for distribution by the Subscriber pursuant
      to Rule 457(o) of the Securities Act, 7,334,996 shares of Common Stock under
      the
      Equity Credit Agreement. Such Registration Statement shall state that, in
      accordance with the Securities Act, it also covers such indeterminate number
      of
      additional shares of Common Stock as may become issuable to prevent dilution
      resulting from stock splits or stock dividends. 

     

    (B)
      TERMINATION. If the Registration Statement covering the Registrable Securities
      required to be filed by the Company pursuant to Section
      2(a)
      hereof
      is not declared effective within two hundred and seventy (270) days from the
      Filing Date (the "Effective
      Date"),
      then
      the commitment contained in the Equity Credit Agreement and in this Agreement
      (the "Commitment")
      shall
      terminate. 

     

     

    3.    
OBLIGATIONS
      OF THE COMPANY.  In connection with the registration of the Registrable
      Securities, the Company shall do each of the following: 

     

    (a)
      Prepare promptly, and file with the SEC by the Filing Date, a Registration
      Statement with respect to not less than the number of Registrable Securities
      provided in Section
      2(a)
      above,
      and, thereafter, use all diligent efforts to cause the Registration Statement
      relating to the Registrable Securities to become effective the earlier of (i)
      five (5) business days after notice from the SEC that the Registration Statement
      may be declared effective, or (ii) the Effective Date, and keep the Registration
      Statement effective at all times until the earliest of (A) the date that is
      one
      year after the completion of the last Closing Date under the Equity Credit
      Agreement, (B) the date when the Subscriber may sell all Registrable Securities
      under Rule 144 without volume limitations, or (C) the date the Subscriber no
      longer owns any of the Registrable Securities (collectively, the "Registration
      Period"),
      which
      Registration Statement (including any amendments or supplements thereto and
      prospectuses contained therein) shall not contain any untrue statement of a
      material fact or omit to state a material fact required to be stated therein
      or
      necessary to make the statements therein, in the light of the circumstances
      under which they were made, not misleading; 

     

    
      
         

      

      
        -
          2
          -

        
          

        

      

      
         

      

    

    (b)
      Prepare and file with the SEC such amendments (including post-effective
      amendments) and supplements to the Registration Statement and the prospectus
      used in connection with the Registration Statement as may be necessary to keep
      the Registration Statement effective at all times during the Registration
      Period, and, during the Registration Period, and comply with the provisions
      of
      the Securities Act with respect to the disposition of all Registrable Securities
      of the Company covered by the Registration Statement until the expiration of
      the
      Registration Period; 

     

    (c)
      Permit a single firm of counsel designated by Subscriber to review the
      Registration Statement and all amendments and supplements thereto a reasonable
      period of time (but not less than three (3) business days) prior to their filing
      with the SEC, and not file any document in a form to which such counsel
      reasonably objects, it being understood that such review and objections shall
      relate exclusively to matters in the Registration Statement or omitted therefrom
      affecting any or all of the Equity Credit Agreement, Subscriber and the
      Registrable Securities or compliance with the terms of this Agreement or the
      other Transaction Documents; 

     

    (d)
      Notify Subscriber and Subscriber's legal counsel identified to the Company
      ("Subscriber's
      Counsel")
      (and,
      in the case of (i)(A) below, not less than five (5) business days prior to
      such
      filing) and (if requested by any such person) confirm such notice in writing
      no
      later than one (1) business day following the day (i): (A) when a prospectus
      or
      any prospectus supplement or post-effective amendment to the Registration
      Statement is proposed to be filed; (B) whenever the SEC notifies the Company
      whether there will be a "review" of such Registration Statement; and (C) with
      respect to the Registration Statement or any post-effective amendment, when
      the
      same has become effective; (ii) of any request by the SEC or any other Federal
      or state governmental authority for amendments or supplements to the
      Registration Statement or the prospectus or for additional information; (iii)
      of
      the issuance by the SEC of any stop order suspending the effectiveness of the
      Registration Statement covering any or all of the Registrable Securities or
      the
      initiation of any proceedings for that purpose; (iv) if at any time any of
      the
      representations or warranties of the Company contained in any agreement
      contemplated hereby ceases to be true and correct in all material respects;
      (v)
      of the receipt by the Company of any notification with respect to the suspension
      of the qualification or exemption from qualification of any of the Registrable
      Securities for sale in any jurisdiction, or the initiation or threatening of
      any
      proceeding for such purpose; and (vi) of the occurrence of any event that to
      the
      knowledge of the Company makes any statement made in the Registration Statement
      or the prospectus or any document incorporated or deemed to be incorporated
      therein by reference untrue in any material respect or that requires any
      revisions to the Registration Statement, the prospectus or other documents
      so
      that, in the case of the Registration Statement or the prospectus, as the case
      may be, it will not contain any untrue statement of a material fact or omit
      to
      state any material fact required to be stated therein or necessary to make
      the
      statements therein, in the light of the circumstances under which they were
      made, not misleading; 

     

    (e)
      Furnish to Subscriber and Subscriber's Counsel, (i) promptly after the same
      is
      prepared and publicly distributed, filed with the SEC, or received by the
      Company, one (1) copy of the Registration Statement, each preliminary prospectus
      and the prospectus, and each amendment or supplement thereto, all correspondence
      to, with, or from the SEC and (ii) such number of copies of a prospectus,
      including a preliminary prospectus, and all amendments and supplements thereto
      and such other documents, as the Subscriber may reasonably request in order
      to
      facilitate the disposition of the Registrable Securities owned by the
      Subscriber; 

     

    
      
         

      

      
        -
          3
          -

        
          

        

      

      
         

      

    

    (f)
      Use
      all diligent efforts to (i) register and/or qualify the Registrable Securities
      covered by the Registration Statement under such other securities or blue sky
      laws of such jurisdictions as the Subscriber may reasonably request and in
      which
      significant volumes of shares of Common Stock are traded, (ii) prepare and
      file
      in those jurisdictions such amendments (including post-effective amendments)
      and
      supplements to such registrations and qualifications as may be necessary to
      maintain the effectiveness thereof at all times during the Registration Period,
      (iii) take such other actions as may be necessary to maintain such registrations
      and qualification in effect at all times during the Registration Period, and
      (iv) take all other actions reasonably necessary or advisable to qualify the
      Registrable Securities for sale in such jurisdictions; provided, however, that
      the Company shall not be required in connection therewith or as a condition
      thereto to (A) qualify to do business in any jurisdiction where it would not
      otherwise be required to qualify but for this Section
      3(f),
      (B)
      subject itself to general taxation in any such jurisdiction, (C) file a general
      consent to service of process in any such jurisdiction, (D) provide any
      undertakings that cause more than nominal expense or burden to the Company
      or
      (E) make any change in its charter or by-laws or any then existing contracts;
      

     

    (g)
      As
      promptly as practicable after becoming aware of such event, notify the
      Subscriber of the happening of any event of which the Company has knowledge,
      as
      a result of which the prospectus included in the Registration Statement, as
      then
      in effect, includes any untrue statement of a material fact or omits to state
      a
      material fact required to be stated therein or necessary to make the statements
      therein, in the light of the circumstances under which they were made, not
      misleading ("Registration
      Default"),
      and
      use all diligent efforts to promptly prepare a supplement or amendment to the
      Registration Statement or other appropriate filing with the SEC to correct
      such
      untrue statement or omission, and any other necessary steps to cure the
      Registration Default, and deliver a number of copies of such supplement or
      amendment to the Subscriber as the Subscriber may reasonably request. Failure
      to
      file such supplement or amendment to the Registration Statement with the SEC
      within twenty (20) business days shall result in the Company incurring
      liquidated damages of 1% of the cost of all Registrable Securities then held
      by
      the Subscriber for each twenty (20) business day period or portion thereof,
      beginning on the twenty-first (21st) business day after the Registration Default
      and terminating on the date such supplement or amendment to the Registration
      Statement is filed with the SEC. 

     

    (h)
      As
      promptly as practicable after becoming aware of such event, notify the
      Subscriber (or, in the event of an underwritten offering, the managing
      underwriters) of the issuance by
      the
      SEC of any notice of effectiveness or any stop order or other suspension of
      the
      effectiveness of the Registration Statement; 

     

    (i)
      Notwithstanding the foregoing, if at any time or from time to time after the
      date of effectiveness of the Registration Statement, the Company notifies
      Subscriber in writing of the existence of a Potential Material Event
      ("Blackout
      Notice"),
      Subscriber shall not offer or sell any Registrable Securities, or engage in
      any
      other transaction involving or relating to the Registrable Securities, from
      the
      time of the giving of notice with respect to a Potential Material Event until
      Subscriber receives written notice from the Company that such Potential Material
      Event either has been disclosed to the public or no longer constitutes a
      Potential Material Event; provided, however, that the Company may not so suspend
      the right to such holders of Registrable Securities for more than two ten (10)
      day periods in the aggregate during any 12-month period 

     

    
      
         

      

      
        -
          4
          -

        
          

        

      

      
         

      

    

    ("Blackout
      Period")
      with
      at least a ten (10) Business Day interval between such periods, during the
      periods the Registration Statement is required to be in effect; 

     

    (j)
      Use
      its commercially reasonable efforts, if eligible, either to (i) cause all the
      Registrable Securities covered by the Registration Statement to be listed on
      a
      national securities exchange and on each additional national securities exchange
      on which securities of the same class or series issued by the Company are then
      listed, if any, if the listing of such Registrable Securities is then permitted
      under the rules of such exchange, or (ii) secure designation of all the
      Registrable Securities covered by the Registration Statement as a National
      Association of Securities Dealers Automated Quotations System ("Nasdaq")
      "Small
      Capitalization"
      within
      the meaning of Rule 11Aa2-1 of the SEC under the Securities Exchange Act of
      1934, as amended (the "Exchange
      Act"),
      and
      the quotation of the Registrable Securities on the Nasdaq Small Cap Market;
      or
      if, despite the Company's commercially reasonable efforts to satisfy the
      preceding clause (i) or (ii), the Company is unsuccessful in doing so, to secure
      NASD authorization and quotation for such Registrable Securities on the
      over-the-counter bulletin board and, without limiting the generality of the
      foregoing, to arrange for at least two market makers to register with the
      National Association of Securities Dealers, Inc. ("NASD")
      as
      such with respect to such Registrable Securities; provided, however, that the
      Subscriber acknowledges that the Company does not currently meet the
      requirements for listing on a national securities exchange or the Nasdaq Small
      Cap Market pursuant to (i) or (ii) and that nothing in this section shall be
      construed to require the Company to pursue such qualification until such time
      as
      the Company satisfies such requirements for a period of not less than forty-five
      (45) days; 

     

    (k)
      Provide a transfer agent for the Registrable Securities not later than the
      Effective Date; 

     

    (l)
      Cooperate with the Subscriber to facilitate the timely preparation and delivery
      of certificates for the Registrable Securities to be offered pursuant to the
      Registration Statement and enable such certificates for the Registrable
      Securities to be in such denominations or amounts as the case may be, as the
      Subscriber may reasonably request and registration in such names as the
      Subscriber may request; and, within five (5) business days after a Registration
      Statement which includes Registrable Securities is ordered effective by the
      SEC,
      the Company shall deliver, and shall cause legal counsel selected by the Company
      to deliver, to the transfer agent for the Registrable Securities (with copies
      to
      the Subscriber) an appropriate instruction and opinion of such counsel, if
      so
      required by the Company's transfer agent; and 

     

    (m)
      Take
      all other reasonable actions necessary to expedite and facilitate distribution
      to the Subscriber of the Registrable Securities pursuant to the Registration
      Statement. 

     

     

    4.     OBLIGATIONS
      OF THE SUBSCRIBER. In connection with the registration of the Registrable
      Securities, the Subscriber shall have the following obligations: 

     

    (a)
      It
      shall be a condition precedent to the obligations of the Company to complete
      the
      registration pursuant to this Agreement with respect to the Registrable
      Securities of the Subscriber that the Subscriber shall timely furnish to the
      Company such information regarding itself, the Registrable Securities held
      by
      it, and the intended method of disposition of the Registrable Securities held
      by
      it, as shall be reasonably required to effect the registration of such
      Registrable Securities and shall timely execute such documents in connection
      with such registration as the Company may reasonably request; 

     

    
      
         

      

      
        -
          5
          -

        
          

        

      

      
         

      

    

    (b)
      The
      Subscriber, by such Subscriber's acceptance of the Registrable Securities,
      agrees to cooperate with the Company as reasonably requested by the Company
      in
      connection with the preparation and filing of the Registration Statement
      hereunder; and 

     

    (c)
      The
      Subscriber agrees that, upon receipt of any notice from the Company of the
      happening of any event of the kind described in Section
      3(g) or 3(h)
      above
      (except for an SEC notice of effectiveness), the Subscriber will immediately
      discontinue disposition of Registrable Securities pursuant to the Registration
      Statement covering such Registrable Securities until the Subscriber receives
      the
      copies of the supplemented or amended prospectus contemplated by Section
      3(g) or 3(h)
      and, if
      so directed by the Company, the Subscriber shall deliver to the Company (at
      the
      expense of the Company) or destroy (and deliver to the Company a certificate
      of
      destruction) all copies in the Subscriber's possession, of the prospectus
      covering such Registrable Securities current at the time of receipt of such
      notice. 

     

     

    5.     EXPENSES
      OF
      REGISTRATION. (a) All reasonable expenses (other than underwriting discounts
      and
      commissions) incurred in connection with Registrations, filings or
      qualifications pursuant to Section
      3,
      including, without limitation, all Registration, listing, and qualifications
      fees, printers and accounting fees, and the fees and disbursements of counsel
      for the Company shall be borne by the Company. 

     

    (b)
      Except as otherwise provided for in Schedule
      5(b)
      attached
      hereto, the Company nor any of its subsidiaries has, as of the date hereof,
      and
      the Company shall not on or after the date of this Agreement, enter into any
      agreement with respect to its securities that is inconsistent with the rights
      granted to Subscriber in this Agreement or otherwise conflicts with the
      provisions hereof. Except as otherwise provided for in Schedule
      5(b),
      the
      Company has not previously entered into any agreement granting any registration
      rights with respect to any of its securities to any person. Except as otherwise
      provided for in this Section
      5,
      and
      without limiting the generality of the foregoing, without the written consent
      of
      Subscriber, the Company shall not grant to any person the right to request
      the
      Company to Register any securities of the Company under the Securities Act
      unless the rights so granted are subject in all respects to the prior rights
      in
      full of Subscriber set forth herein, and are not otherwise in conflict or
      inconsistent with the provisions of this Agreement and the other Transaction
      Documents. 

     

     

    6.     INDEMNIFICATION.
      After Registrable Securities are included in a Registration Statement under
      this
      Agreement: 

     

    (a)
      To
      the extent permitted by law, the Company will indemnify and hold harmless,
      the
      Subscriber, the directors, if any, of such Subscriber, the officers, if any,
      of
      such Subscriber, each person, if any, who controls the Subscriber within the
      meaning of the Securities Act or the Exchange Act (each, an "Indemnified
      Person"),
      against any losses, claims, damages, liabilities or expenses (joint or several)
      incurred (collectively, "Claims")
      to
      which any of them may become subject under the Securities Act, the Exchange
      Act
      or otherwise, insofar as such Claims (or actions or proceedings, whether
      commenced or threatened, in respect thereof) arise out of or are based upon:
      (i)
      any untrue statement or alleged untrue statement of a material fact contained
      in
      the Registration Statement or any post-effective amendment thereof or the
      omission or alleged omission to state therein a material fact required to be
      stated therein or necessary to make the statements made therein, in the light
      of
      the circumstances under which the statements therein were made, not misleading,
      (ii) any untrue statement or alleged untrue statement of a material

     

    
      
         

      

      
        -
          6
          -

        
          

        

      

      
         

      

    

    fact
      contained in the final prospectus (as amended or supplemented, if the Company
      files any amendment thereof or supplement thereto with the SEC) or the omission
      or alleged omission to state therein any material fact necessary to make the
      statements made therein, in the light of the circumstances under which the
      statements therein were made, not misleading or (iii) any violation or alleged
      violation by the Company of the Securities Act, the Exchange Act, any state
      securities law or any rule or regulation under the Securities Act, the Exchange
      Act or any state securities law (the matters in the foregoing clauses (i)
      through (iii) being collectively referred to as "Violations").
      Subject to clause (b) of this Section
      6,
      the
      Company shall reimburse the Subscriber, promptly as such expenses are incurred
      and are due and payable, for any reasonable legal fees or other reasonable
      expenses incurred by them in connection with investigating or defending any
      such
      Claim. Notwithstanding anything to the contrary contained herein, the
      indemnification agreement contained in this Section
      6(a)
      shall
      not (i) apply to any Claims arising out of or based upon a Violation which
      occurs in reliance upon and in conformity with information furnished in writing
      to the Company by or on behalf of any Indemnified Person expressly for use
      in
      connection with the preparation of the Registration Statement or any such
      amendment thereof or supplement thereto, if such Registration Statement was
      timely made available by the Company pursuant to Section
      3(b)
      hereof;
      (ii) with respect to any preliminary prospectus, inure to the benefit of any
      such person from whom the person asserting any such Claim purchased the
      Registrable Securities that are the subject thereof (or to the benefit of any
      person controlling such person) if the untrue statement or omission of material
      fact contained in the preliminary prospectus was corrected in the final
      prospectus, as then amended or supplemented, if such final prospectus was timely
      made available by the Company pursuant to Section
      3(b)
      hereof;
      (iii) be available to the extent such Claim is based on a failure of the
      Subscriber to deliver or cause to be delivered the Prospectus made available
      by
      the Company; (iv) apply to amounts paid in settlement of any Claim if such
      settlement is effected without the prior written consent of the Company, which
      consent shall not be unreasonably withheld; or (v) apply to the extent that
      such
      Claims are caused by, result from or arise out of any breach of this Agreement
      by the Subscriber or any intentionally wrongful or grossly negligent conduct
      by
      the Subscriber. The Subscriber will indemnify the Company and its officers,
      directors and agents (including legal counsel) (each, an "Indemnified
      Person")
      against any claims arising out of or based upon a Violation which occurs in
      reliance upon and in conformity with information furnished in writing to the
      Company, by or on behalf of such Subscriber, expressly for use in connection
      with the preparation of the Registration Statement, or arising out of or based
      upon a failure of the Subscriber to deliver or cause to be delivered the
      Prospectus made available by the Company, subject to such limitations and
      conditions set forth in the previous sentence. Such indemnity shall remain
      in
      full force and effect regardless of any investigation made by or on behalf
      of
      any Indemnified Person. 

     

    (b)
      Promptly after receipt by an Indemnified Person under this Section
      6
      of
      notice of the commencement of any action (including any governmental action),
      such Indemnified Person shall, if a Claim in respect thereof is to be made
      against any indemnifying party under this Section
      6,
      deliver
      to the indemnifying party a written notice of the commencement thereof. In
      case
      any such action is brought against any Indemnified Person, and it notifies
      the
      indemnifying party of the commencement thereof, the indemnifying party will
      be
      entitled to participate in, and, to the extent that it so desires, jointly
      with
      any other indemnifying party similarly notified, to assume control of the
      defense thereof with counsel mutually satisfactory to the indemnifying party
      and
      the Indemnified Person. Subject to the provisions herein stated and after notice
      from 

     

    
      
         

      

      
        -
          7
          -

        
          

        

      

      
         

      

    

    the
      indemnifying party to such Indemnified Person of its election to assume control
      of the defense thereof, the indemnifying party will not be liable to such
      Indemnified Person under this Section
      6
      for any
      legal or other out-of-pocket expenses subsequently incurred by such Indemnified
      Person in connection with the defense thereof other than reasonable costs of
      investigation, unless the indemnifying party shall not pursue the action to
      its
      final conclusion. The Indemnified Person shall have the right to employ separate
      counsel in any such action and to participate in the defense thereof, but the
      fees and reasonable out-of-pocket expenses of such counsel shall not be at
      the
      expense of the indemnifying party if the indemnifying party has assumed the
      defense of the action with counsel reasonably satisfactory to the Indemnified
      Person. The failure to deliver written notice to the indemnifying party within
      a
      reasonable time of the commencement of any such action shall not relieve such
      indemnifying party of any liability to the Indemnified Person under this
Section
      6,
      except
      to the extent that the indemnifying party is prejudiced in its ability to defend
      such action. The indemnification required by this Section
      6
      shall be
      made by periodic payments of the amount thereof during the course of the
      investigation or defense, as such expense, loss, damage or liability is incurred
      and is due and payable. 

     

     

    7.     CONTRIBUTION.
      To the extent any indemnification by an indemnifying party is prohibited or
      limited by law, the indemnifying party agrees to make the maximum contribution
      with respect to any amounts for which it would otherwise be liable under
Section
      6
      to the
      fullest extent permitted by law; provided, however, that (a) no contribution
      shall be made under circumstances where the maker would not have been liable
      for
      indemnification under the fault standards set forth in Section
      6;
      (b) no
      seller of Registrable Securities guilty of fraudulent misrepresentation (within
      the meaning of Section 11(f) of the Securities Act) shall be entitled to
      contribution from any seller of Registrable Securities who was not guilty of
      such fraudulent misrepresentation; and (c) contribution by any seller of
      Registrable Securities shall be limited in amount to the net proceeds received
      by such seller from the sale of such Registrable Securities. 

     

     

    8.     REPORTS
      UNDER
      EXCHANGE ACT. With a view to making available to the Subscriber the benefits
      of
      Rule 144 promulgated under the Securities Act or any other similar rule or
      regulation of the SEC that may at any time permit the Subscriber to sell
      securities of the Company to the public without registration ("Rule
      144"),
      the
      Company agrees to use its reasonable best efforts to: 

     

    (a)
      make
      and keep public information available, as those terms are understood and defined
      in Rule 144; 

     

    (b)
      file
      with the SEC in a timely manner all reports and other documents required of
      the
      Company under the Exchange Act; 

     

    (c)
      furnish to the Subscriber so long as the Subscriber owns Registrable Securities,
      promptly upon request, (i) a written statement by the Company that it has
      complied with the reporting requirements of Rule 144, the Securities Act and
      the
      Exchange Act, (ii) a copy of the most recent annual or quarterly report of
      the
      Company and such other reports and documents so filed by the Company solely
      if
      unavailable by EDGAR, and (iii) such other information as may be reasonably
      requested to permit the Subscriber to sell such securities pursuant to Rule
      144
      without registration; and 

     

    
      
         

      

      
        -
          8
          -

        
          

        

      

      
         

      

    

    (d)
      at
      the request of the Subscriber, give its Transfer Agent instructions (supported
      by an opinion of Company counsel, if required or requested by the Transfer
      Agent) to the effect that, upon the Transfer Agent's receipt from such
      Subscriber of: 

     

    (i)
      a
      certificate (a "Rule
      144 Certificate")
      certifying (A) that such Subscriber has held the shares of Registrable
      Securities which the Subscriber proposes to sell (the "Securities
      Being Sold")
      for a
      period of not less than (1) year and (B) as to such other matters as may be
      appropriate in accordance with Rule 144 under the Securities Act, and

     

    (ii)
      an
      opinion of Subscriber's counsel, acceptable to the Company, that, based on
      the
      Rule 144 Certificate, the Securities Being Sold may be sold pursuant to the
      provisions of Rule 144, even in the absence of an effective Registration
      Statement, the Transfer Agent is to effect the transfer of the Securities Being
      Sold and issue to the buyer(s) or transferee(s) thereof one or more stock
      certificates representing the transferred Securities Being Sold without any
      restrictive legend and without recording any restrictions on the transferability
      of such shares on the Transfer Agent's books and records (except to the extent
      any such legend or restriction results from facts other than the identity of
      the
      Subscriber, as the seller or transferor thereof, or the status, including any
      relevant legends or restrictions, of the shares of the Securities Being Sold
      while held by the Subscriber). If the Transfer Agent requires any additional
      documentation at the time of the transfer, the Company shall deliver or cause
      to
      be delivered all such reasonable additional documentation as may be necessary
      to
      effectuate the issuance of an unlegended certificate. 

     

     

    9.     MISCELLANEOUS.
      

     

    (A)
      REGISTERED OWNERS. A person or entity is deemed to be a holder of Registrable
      Securities whenever such person or entity owns of record such Registrable
      Securities. If the Company receives conflicting instructions, notices or
      elections from two or more persons or entities with respect to the same
      Registrable Securities, the Company shall act upon the basis of instructions,
      notice or election received from the registered owner of such Registrable
      Securities, who shall provide a bond or other form of satisfactory protection
      to
      the Company so as to cover contingent liability against other claimants.

     

    (B)
      RIGHTS CUMULATIVE; WAIVERS. The rights of each of the parties under this
      Agreement are cumulative. The rights of each of the parties hereunder shall
      not
      be capable of being waived or varied other than by an express waiver or
      variation in writing. Any failure to exercise or any delay in exercising any
      of
      such rights shall not operate as a waiver or variation of that or any other
      such
      right. Any defective or partial exercise of any of such rights shall not
      preclude any other or further exercise of that or any other such right. No
      act
      or course of conduct or negotiation on the part of any party shall in any way
      preclude such party from exercising any such right or constitute a suspension
      or
      any variation of any such right. 

     

    (C)
      BENEFIT; SUCCESSORS BOUND. This Agreement and the terms, covenants, conditions,
      provisions, obligations, undertakings, rights, and benefits hereof, shall be
      binding upon, and shall inure to the benefit of, the undersigned parties and
      their heirs, executors, administrators, representatives and successors.

     

    
      
         

      

      
        -
          9
          -

        
          

        

      

      
         

      

    

    (D)
      ENTIRE AGREEMENT. This Agreement contains the entire agreement between the
      parties with respect to the subject matter hereof. There are no promises,
      agreements, conditions, undertakings, understandings, warranties, covenants
      or
      representations, oral or written, express or implied, between them with respect
      to this Agreement or the matters described in this Agreement, except as set
      forth in this Agreement and in the other documentation relating to the
      transactions contemplated by this Agreement. Any such promises, agreements,
      conditions, undertakings, understandings, warranties, covenants or
      representations shall not be used to interpret or constitute this Agreement.
      

     

    (E)
      [INTENTIONALLY OMITTED] 

     

    (F)
      [INTENTIONALLY OMITTED]

     

    (G)
      SEVERABILITY. Each part of this Agreement is intended to be severable. In the
      event that any provision of this Agreement is found by any court or other
      authority of competent jurisdiction to be illegal or unenforceable, such
      provision shall be severed or modified to the extent necessary to render it
      enforceable and as so severed or modified, this Agreement shall continue in
      full
      force and effect. 

     

    (H)
      NOTICES. Notices required or permitted to be given hereunder shall be in writing
      and shall be deemed to be given as provided in the Equity Credit Agreement.
      

     

    (I)
      GOVERNING LAW. THIS AGREEMENT SHALL BE GOVERNED BY AND INTERPRETED IN ACCORDANCE
      WITH THE LAWS OF THE STATE OF NEW YORK FOR CONTRACTS TO BE WHOLLY PERFORMED
      IN
      SUCH STATE AND WITHOUT GIVING EFFECT TO THE PRINCIPLES THEREOF REGARDING THE
      CONFLICT OF LAWS. EACH OF THE PARTIES CONSENTS TO THE EXCLUSIVE JURISDICTION
      OF
      THE FEDERAL COURTS WHOSE DISTRICTS ENCOMPASS THE COUNTY OF NEW YORK OR THE
      STATE
      COURTS OF THE STATE OF NEW YORK SITTING IN THE COUNTY OF NEW YORK IN CONNECTION
      WITH ANY DISPUTE ARISING UNDER THIS AGREEMENT AND HEREBY WAIVES, TO THE MAXIMUM
      EXTENT PERMITTED BY LAW, ANY OBJECTION, INCLUDING ANY OBJECTION BASED ON FORUM
      NON CONVENIENS, TO THE BRINGING OF ANY SUCH PROCEEDING IN SUCH JURISDICTIONS.
      

     

    (J)
      JURY
      TRIAL WAIVER. THE COMPANY AND SUBSCRIBER HEREBY WAIVE A TRIAL BY JURY IN ANY
      ACTION, PROCEEDING OR COUNTERCLAIM BROUGHT BY EITHER OF THE PARTIES HERETO
      AGAINST THE OTHER IN RESPECT OF ANY MATTER ARISING OUT OF OR IN CONNECTION
      WITH
      THE TRANSACTION DOCUMENTS 

     

    (K)
      CONSENTS. The person signing this Agreement on behalf of each party hereby
      represents and warrants that he has the necessary power, consent and authority
      to execute and deliver this Agreement on behalf of that party. 

     

    (L)
      FURTHER ASSURANCES. In addition to the instruments and documents to be made,
      executed and delivered pursuant to this Agreement, the parties hereto agree
      to
      make, execute and deliver or cause to be made, executed and delivered, to the
      requesting party such 

     

    
      
         

      

      
        -
          10
          -

        
          

        

      

      
         

      

    

    other
      instruments and to take such other actions as the requesting party may
      reasonably require to carry out the terms of this Agreement and the transactions
      contemplated hereby. 

     

    (M)
      SECTION HEADINGS. The Section headings in this Agreement are for reference
      purposes only and shall not affect in any way the meaning or interpretation
      of
      this Agreement. 

     

    (N)
      CONSTRUCTION. Unless the context otherwise requires, when used herein, the
      singular shall be deemed to include the plural, the plural shall be deemed
      to
      include each of the singular, and pronouns of one or no gender shall be deemed
      to include the equivalent pronoun of the other or no gender. 

     

    (O)
      EXECUTION IN COUNTERPARTS. This Agreement may be executed in two or more
      counterparts, each of which shall be deemed an original but all of which shall
      constitute one and the same agreement. This Agreement, once executed by a party,
      may be delivered to the other party hereto by telephone line facsimile
      transmission of a copy of this Agreement bearing the signature of the party
      so
      delivering this Agreement. A facsimile transmission of this signed Agreement
      shall be legal and binding on all parties hereto. 

     

    
 

     

     

     

     

     

     

     

     

     

     

     

     

     

     

     

     

     

     

    
 

    
      
         

      

      
        -
          11
          -

        
          

        

      

      
         

      

    

     

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

     

     

     

    
      	 	 	 
	 	 
	 	
              COMPANY:

            
	 	 
	 	GLOBAL
              MATRECHS, INC.
	 
 	 
 	 
 
	 	By:  	/s/ Michael
              Sheppard
	 	
              

              Name:
                Michael Sheppard

            
	 	Title:  
              President 

    

     

     

     

     

    
      	 	 	 
	 	SUBSCRIBER: 
	 	 
	 	BRITTANY
              CAPITALMANAGEMENT LTD
	 
 	 
 	 
 
	
            	By:  	/s/ Barry
              W. Herman
	 	
              
Name:
              Barry W. Herman
	 	Title:  
              President

    

     

     

     

     

     

     

     

     

     

    

     

    

     

    
      
         

      

      
        -
          12
          -Exhibit 4.01

 

	
  CUSIP NO. 52517PL74

  	
   

  
	
  ISIN NO. US52517PL740

  	
   

  
	
  REGISTERED

  	
  PRINCIPAL AMOUNT: $3,500,000

  
	
  No. R-1

  	
   

  
	
   

  	
   

  

LEHMAN BROTHERS HOLDINGS INC.

MEDIUM-TERM NOTE, SERIES I

GLOBAL BASKET APPRECIATION FX-LINKED NOTE
DUE SEPTEMBER 12, 2011

THIS
NOTE IS A GLOBAL SECURITY WITHIN THE MEANING OF THE INDENTURE HEREINAFTER
REFERRED TO AND IS REGISTERED IN THE NAME OF THE DEPOSITORY OR A NOMINEE OF THE
DEPOSITORY.  UNLESS THIS CERTIFICATE IS
PRESENTED BY AN AUTHORIZED REPRESENTATIVE OF THE DEPOSITORY TRUST COMPANY (55
WATER STREET, NEW YORK, NEW YORK) TO THE COMPANY (AS DEFINED BELOW) OR ITS
AGENT FOR REGISTRATION OF TRANSFER, EXCHANGE OR PAYMENT AND ANY CERTIFICATE
ISSUED IS REGISTERED IN THE NAME OF CEDE & CO. OR SUCH OTHER NAME AS REQUESTED
BY AN AUTHORIZED REPRESENTATIVE OF THE DEPOSITORY TRUST COMPANY AND ANY PAYMENT
IS MADE TO CEDE & CO., ANY TRANSFER, PLEDGE OR OTHER USE HEREOF FOR VALUE
OR OTHERWISE BY OR TO ANY PERSON IS WRONGFUL SINCE THE REGISTERED OWNER HEREOF,
CEDE & CO., HAS AN INTEREST HEREIN.

UNLESS
AND UNTIL IT IS EXCHANGED IN WHOLE OR IN PART FOR NOTES IN CERTIFICATED FORM (A
“CERTIFICATED NOTE”), THIS GLOBAL SECURITY MAY NOT BE TRANSFERRED EXCEPT AS A
WHOLE BY THE DEPOSITORY TO A NOMINEE OF THE DEPOSITORY OR BY A NOMINEE OF THE
DEPOSITORY TO THE DEPOSITORY OR ANOTHER NOMINEE OF THE DEPOSITORY OR BY THE
DEPOSITORY OR ANY SUCH NOMINEE TO A SUCCESSOR DEPOSITORY OR A NOMINEE OF SUCH
SUCCESSOR DEPOSITORY.

 

LEHMAN BROTHERS HOLDINGS
INC., a corporation duly organized and existing under the laws of the State of
Delaware (herein called the “Company,” which term includes any successor
corporation under the Indenture referred to on the reverse hereof), for value
received, hereby promises to pay to CEDE & Co., or registered assigns, on
the Maturity Date, an amount equal to the Redemption Amount.  The Notes do not bear interest. No payments
on the Notes will be made until the Maturity Date.

The “Maturity Date” is
September 12, 2011, or if such day is not a Business Day, on the next following
Business Day.

The “Redemption Amount”,
for each $1 principal amount of the Notes represented hereby, is the amount
equal to the sum of $1 plus (a) the
Minimum Return and (b) the Additional Amount.

The “Minimum Return”, for
each $1 principal amount of the Notes represented hereby, is the amount equal
to $0.05.

The “Additional Amount”,
for each $1 principal amount of the Notes represented hereby will be 220% times
the Basket Value, provided that the minimum Additional Amount payable on the
notes shall be zero.

The
“Reference Currencies” are the Australian Dollar (AUD), Canadian Dollar
(CAD), Euro (EUR), Pound Sterling (GBP) and the Japanese Yen (JPY).

The
“Basket Value” equals the sum of:

(i) a quotient, the numerator of which is 0.26103 and the denominator of which is the Settlement Rate for AUD plus

(ii) a quotient, the numerator of which is 0.22110 and the denominator of which is the Settlement Rate for CAD plus

(iii) a quotient, the numerator of which is 0.15616 and the denominator of which is the Settlement Rate for EUR plus

(iv) a quotient, the numerator of which is 0.10613 and the denominator of which is the Settlement Rate for GBP plus

(v) a quotient, the numerator of which is 23.32600 and the denominator of which is the Settlement Rate for JPY plus

(vi) a quotient, the numerator of which is -1.0000 and the denominator of which is the Settlement Rate for USD.

The “Settlement Rate” for each Reference Currency is the
Reference Exchange Rate on the Valuation Date (subject to the occurrence of a
Disruption Event), observed as per the Settlement Rate Option (subject to the
occurrence of a Price Source Unavailability Event). The Settlement Rate for the
USD shall be 1.

 2
 

 

The “Reference Exchange Rates”
are the spot exchange rates for each of the Reference Currencies quoted against
the U.S. dollar expressed as the number of currency units per USD 1.

The “Settlement Rate Option” for each Reference
Currency is as follows:

	
  Reference 

  Currency

  	
   

  	
  

  Screen Reference

  
	
  AUD

  	
   

  	
  One divided by spot rate on 1FEE

  
	
  CAD

  	
   

  	
  1FED

  
	
  EUR

  	
   

  	
  One divided by spot rate on 1FED

  
	
  GBP

  	
   

  	
  One divided by spot rate on 1FED

  
	
  JPY

  	
   

  	
  1FED

  

 

For information concerning the Screen Reference
relating to each Reference Currency, see Appendix A to the Lehman Brothers
Holdings Inc. MTN, Series I, prospectus supplement dated May 30, 2006.

The term “business day”
solely as used in any Settlement Rate Option described above shall mean any
day, other than a Saturday or Sunday, that is neither a legal holiday nor a day
on which commercial banks are authorized or required by law, regulation or
executive order to close (including for dealings in foreign exchange in
accordance with the practice of the foreign exchange market) in the Principal
Financial Center for both (a) the Reference Currency and (b) the
currency against which the Reference Currency is quoted (the “base currency”)
in accordance with the Reference Exchange Rate specified in the applicable
pricing supplement, in each case as specified for the applicable Reference
Currency or base currency in the table below.

The screen or time of observation indicated in
relation to any Settlement Rate Option above shall be deemed to refer to such
screen or time of observation as modified or amended from time to time, or to
any substitute screen thereto.

The “Valuation Date” is September 6, 2011 or, if such
day is not a Valuation Business Day, the immediately preceding Valuation
Business day.

A “Valuation Business Day” means, with respect to each Reference
Currency, any day, other than a Saturday or Sunday, that is neither a legal
holiday nor a day on which commercial banks are authorized or required by law,
regulation or executive order to close (including for dealings in foreign
exchange in accordance with the practice of the foreign exchange market) in the
city or jurisdiction indicated in the table below:

	
  Reference Currency

  	
   

  	
  Valuation Business Day

  
	
  AUD

  	
   

  	
  New York

  
	
  CAD

  	
   

  	
  New York

  
	
  EUR

  	
   

  	
  New York

  
	
  GBP

  	
   

  	
  New York

  
	
  JPY

  	
   

  	
  New York

  

 

 3
 

 

A “Business Day”,
notwithstanding any provision in the Indenture, is any day that is not is not a
Saturday or Sunday and that is not a day on which banking institutions in New
York City generally are authorized or obligated by law or executive order to be
closed.

Upon
the occurrence of a Disruption Event with respect to any Reference Currency on
any day during the term of the notes, the Calculation Agent will determine the
Settlement Rate for the affected Reference Currency as of the day on which such
Disruption Event occurred in accordance with the Fallback Rate Observation
Methodology.

“Calculation Agent” means Lehman Brothers Inc.

A “Disruption Event” means any of the following events
(other than a Price Source Unavailability Event), as determined in good faith
by the Calculation Agent:

(A)                              the occurrence and/or existence of an event on any
day that has the effect of preventing or making impossible (x) the conversion
of any Reference Currency into USD through customary legal channels; or (y) for
any Reference Currency other than EUR, the delivery of USD from accounts inside
the country for which a Reference Currency is the lawful currency (such
jurisdiction with respect to such Reference Currency, the “Reference Currency
Jurisdiction”) to accounts outside that Reference Currency Jurisdiction;

(B)                                the occurrence of any event causing the Reference
Exchange Rate for any Reference Currency to be split into dual or multiple
currency exchange rates; or

(C)                                for any Reference Currency other than EUR, the
occurrence and/or existence of any event (other than those set forth in (A) or
(B) above) in a Reference Currency Jurisdiction that materially disrupts the
market for such Reference Currency.

Upon the occurrence of a Price Source Unavailability Event
with respect to a Reference Currency, the Settlement Rate for the affected
Reference Currency will be determined in accordance with the Fallback Rate
Observation Methodology.

A “Price Source Unavailability Event” means, as determined in good
faith by the Calculation Agent, the Settlement Rate being unavailable for a
Reference Currency, or the occurrence of an event (other than an event
constituting a Disruption Event) that generally makes it impossible to obtain
the Settlement Rate for a Reference Currency, on the relevant Valuation Date.

The “Fallback
Rate Observation Methodology” means that the reference exchange rate,
Settlement Rate or other rate, as specified in the applicable pricing
supplement, in respect of a reference currency will equal the noon buying rate
in New York for cable transfers in foreign currencies as announced by the
Federal Reserve Bank of New York for customs purposes (the “Noon Buying Rate”)
on the relevant Valuation Date or such other date specified in the applicable
pricing supplement. If the Noon Buying Rate is not announced on that date, the
Reference Exchange Rate, Settlement Rate or other rate for such Reference
Currency will be calculated on the basis of the arithmetic mean of the
applicable spot quotations received by the calculation agent at approximately
10:00 a.m., New York City time, on the Valuation Business Day next
succeeding the Valuation Date or such other date specified in the applicable
pricing supplement, for the purchase or sale for deposits in the reference
currency by the New York offices of three leading banks engaged in the interbank
market (selected in the sole discretion of the calculation agent) (the “Reference
Banks”). If fewer than three Reference Banks provide spot 

 4
 

 

quotations,
then the reference exchange rate, Settlement Rate or other rate, as applicable,
will be calculated on the basis of the arithmetic mean of the applicable spot
quotations received by the calculation agent at approximately 10:00 a.m.,
New York City time, on the relevant date from two Reference Banks (selected in
the sole discretion of the calculation agent), for the purchase or sale for
deposits in the reference currency. If these spot quotations are available from
only one Reference Bank, then the calculation agent, in its sole discretion,
will determine whether that quotation is reasonable to be used. If no spot
quotation is available, then the Reference Exchange Rate, Settlement Rate or
other rate, as applicable, for such reference currency will be determined by
the calculation agent in good faith and in a commercially reasonable manner.

Except as provided below, the Redemption Amount may,
at the option of the Company, be made by check mailed to the person entitled
thereto at such person’s address as it appears on the registry books of the
Company.

Payment of the Redemption Amount will be made in
immediately available funds upon surrender of this Note at the corporate trust
office or agency of the Trustee (or any duly appointed Paying Agent) maintained
for that purpose in the Borough of Manhattan, New York City (the “Corporate
Trust Office”), provided that this Note is presented to the Trustee (or any
such Paying Agent) in time for the Trustee (or any such Paying Agent) to make
such payments in such funds in accordance with its normal procedures.

The Company will pay any administrative costs imposed
by banks in making payments in immediately available funds, but any tax,
assessment or governmental charge imposed upon payments hereunder, including,
without limitation, any withholding tax, will be borne by the Holder hereof.

References herein to “USD”, “U.S. dollars” or “U.S.$”
or “$” are to the coin or currency of the United States as at the time of
payment is legal tender for the payment of public and private debts.

REFERENCE IS HEREBY MADE TO
THE FURTHER PROVISIONS OF THIS NOTE SET FORTH ON THE REVERSE HEREOF.  SUCH FURTHER PROVISIONS SHALL FOR ALL
PURPOSES HAVE THE SAME EFFECT AS IF SET FORTH AT THIS PLACE.

This Note shall not be valid or become obligatory for
any purpose until the certificate of authentication hereon shall have been
signed by the Trustee under the Indenture.

 5
 

 

IN WITNESS WHEREOF, Lehman Brothers Holdings Inc. has
caused this instrument to be signed by its Chairman of the Board, its
President, its Vice Chairman, its Chief Financial Officer, one of its Vice
Presidents or its Treasurer, by manual or facsimile signature under its
corporate seal, attested by its Secretary or one of its Assistant Secretaries
by manual or facsimile signature.

	
  Dated: September 12, 2006

  	
   

  
	
   

  	
   

  
	
  [SEAL]

  	
  LEHMAN BROTHERS HOLDINGS INC.

  
	
   

  	
   

  
	
   

  	
  By:

  	
   

  
	
   

  	
   

  	
  Name:

  
	
   

  	
   

  	
  Title:

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  Attest:

  	
   

  
	
   

  	
   

  	
  Name:

  
	
   

  	
   

  	
  Title:

  

 

TRUSTEE’S
CERTIFICATE OF AUTHENTICATION

This is one of the
Securities of the series designated herein referred to in the within-mentioned
Indenture.

	
  CITIBANK, N.A.

  
	
  as Trustee

  
	
   

  
	
   

  
	
  By:

  	
   

  	
   

  
	
   

  	
  Authorized Officer

  	
   

  

 

 6

 

[REVERSE
OF NOTE]

LEHMAN BROTHERS
HOLDINGS INC.

MEDIUM-TERM NOTES,
SERIES I

GLOBAL BASKET APPRECIATION FX-LINKED NOTE
DUE SEPTEMBER 12, 2011

Section 1.  General.
This Note is one of a duly authorized series of Notes of the Company designated
as the Medium-Term Notes, Series I, Global Basket Appreciation FX-Linked Note
(herein called the “Notes”). The
Notes are one of an indefinite number of series of debt securities of the
Company (collectively, the “Securities”) issued or issuable under and pursuant
to an indenture dated as of September 1, 1987, as amended and supplemented (the
“Indenture”), duly executed and delivered by the Company and Citibank, N.A., as
Trustee (herein called the “Trustee”), to which Indenture and all indentures
supplemental thereto reference is hereby made for a description of the rights,
limitations of rights, obligations, duties and immunities thereunder of the
Trustee, the Company and the holders of the Securities. The separate series of
Securities may be issued in various aggregate principal amounts, may mature at
different times, may bear interest (if any) at different rates, may be subject
to different redemption provisions or repurchase rights (if any), may be
subject to different sinking, purchase or analogous funds (if any), may be
subject to different covenants and Events of Default and may otherwise vary as
in the Indenture provided.

Section 2.  Principal
Amount for Indenture Purposes. For the purpose of determining whether
Holders of the requisite amount of Notes of this series outstanding under the
Indenture have made a demand, given a notice or waiver or taken any other
action, the principal amount of this Note will be deemed to be the principal
amount of this Note then outstanding.

Section 3.  Modification
and Waivers. The Indenture contains provisions permitting the Company and
the Trustee, with the consent of the Holders of not less than 66-2/3% in
aggregate principal amount of each series of the Securities at the time
Outstanding to be affected, evidenced as in the Indenture provided, to execute
supplemental indentures adding any provisions to or changing in any manner or
eliminating any of the provisions of the Indenture or of any supplemental
indenture or modifying in any manner the rights of the holders of the Securities
of all such series; provided, however, that no such supplemental indenture
shall, among other things, (i) change the fixed maturity of any Security, or
reduce the Redemption Amount or the principal amount thereof, or reduce the
rate or extend the time of payment of interest thereon or reduce any premium or
other amount payable on redemption, or make the Redemption Amount or the
principal amount thereof, premium or other amount payable, if any, or interest
thereon payable in any coin or currency other than that hereinabove provided,
without the consent of the Holder of each Security so affected, or (ii) change
the place of payment on any Security, or impair the right to institute suit for
payment on any Security, or reduce the aforesaid percentage of Securities, the
holders of which are required to consent to any such supplemental indenture,
without the consent of the holders of each Security so affected. It is also
provided in the Indenture that, prior to any declaration accelerating the
maturity of any series of Securities, the holders of a majority in aggregate
principal amount of the Securities of such series Outstanding may on behalf of
the holders of all the Securities of such series waive any past 

 

default
or Event of Default under the Indenture with respect to such series and its
consequences, except a default in the payment of interest, if any, on the
Redemption Amount or the principal amount, or premium, if any, on any of the
Securities of such series, or in the payment of any sinking fund installment or
analogous obligation with respect to Securities of such series. Any such
consent or waiver by the Holder of this Note shall be conclusive and binding
upon such Holder and upon all future holders and owners of this Note and any
Notes of this series which may be issued in exchange or substitution herefor,
irrespective of whether or not any notation thereof is made upon this Note or
such other Notes of this series.

Section 4.  Obligations
Unconditional. No reference herein to the Indenture and no provisions of
this Note or of the Indenture shall alter or impair the obligation of the
Company, which is absolute and unconditional, to pay the Redemption Amount or
the principal amount on this Note at the place, at the respective times, at the
rate, and in the coin or currency herein prescribed.

Section 5. Defeasance. The Indenture contains
provisions for the discharge of the Indenture and defeasance at any time of the
indebtedness on this Note upon compliance by the Company with certain
conditions set forth therein, which provisions apply to this Note.

Section 6. Authorized Form and Denominations.
The Notes of this series are issuable in registered form, without coupons. Each
Note will be issued initially as either a Global Security or a Certificated
Note, at the option of the Company, in denominations of $1,000 or whole
multiples of $1,000, either at the office or agency to be designated and
maintained by the Company for such purpose in the Borough of Manhattan, New
York City, pursuant to the provisions of the Indenture or at any of such other
offices or agencies as may be designated and maintained by the Company for such
purpose pursuant to the provisions of the Indenture, and in the manner and
subject to the limitations provided in the Indenture, but without the payment
of any service charge, except for any tax or other governmental charges imposed
in connection therewith. Notes of this series are exchangeable for a like
aggregate principal amount of Notes of this series of a different authorized
denomination, except that Global Securities will not be exchangeable for
Certificated Notes of this series.

Section 7.  Registration
of Transfer.  As provided in the
Indenture and subject to certain limitations as therein set forth, the transfer
of this Note is registrable in the Security Register, upon surrender of this
Note for registration of transfer, at the Corporate Trust Office or agency in a
Place of Payment for this Note, duly endorsed by, or accompanied by a written
instrument of transfer in form satisfactory to the Company and the Security
Registrar requiring such written instrument of transfer duly executed by, the
Holder hereof or his attorney duly authorized in writing, and thereupon one or
more new Notes of this series, of authorized denominations and for the same
aggregate principal amount, will be issued to the designated transferee or
transferees.

If at any time the Depository notifies the Company
that it is unwilling or unable to continue as Depository or if at any time the
Depository shall no longer be eligible under the Indenture, the Company shall
appoint a successor Depository. If a successor Depository for the Notes of this
series is not appointed by the Company within 90 days after the Company
receives such notice or becomes aware of such ineligibility, the Company will
issue, and the Trustee will

 

authenticate
and deliver, Notes of this series in definitive form in an aggregate principal
amount equal to the principal amount of this Note.

No service charge shall be made for any such
registration of transfer or exchange, but the Company may require payment of a
sum sufficient to cover any tax or other governmental charge that may be
imposed in connection therewith.

Prior to due presentment of this Note for registration
of transfer, the Company, the Trustee and any agent of the Company or the
Trustee may treat the person in whose name this Note is registered as the owner
hereof for all purposes, and neither the Company nor the Trustee nor any agent
of the Company or of the Trustee shall be affected by any notice to the
contrary.

Section 8.  Events
of Default.  If an Event of Default
with respect to Notes of this series shall occur and be continuing, the amount
declared due and payable upon any acceleration of the Notes will be determined
by the Calculation Agent and will equal the Redemption Amount calculated as
though the maturity of the Notes were the date of early repayment in the manner
and with the effect provided in the Indenture. The amount payable to the Holder
hereof upon any acceleration permitted under the Indenture will be equal to the
Redemption Amount calculated as though the date to which the maturity has been
accelerated were the Maturity Date as determined by the Calculation Agent.

Section 9.  No
Recourse Against Certain Persons.  No
recourse for the payment of the Redemption Amount or for any claim based hereon
or otherwise in respect hereof, and no recourse under or upon any obligation,
covenant or agreement of the Company in the Indenture or any Indenture
supplemental thereto or in any Note, or because of the creation of any
indebtedness represented thereby, shall be had against any incorporator,
stockholder, officer or director, as such, past, present or future, of the
Company or of any successor corporation, either directly or through the Company
or any successor corporation, whether by virtue of any constitution, statute or
rule of law or by the enforcement of any assessment or penalty or otherwise,
all such liability being, by the acceptance hereof and as part of the
consideration for the issue hereof, expressly waived and released.

Section 10.  Defined
Terms.  All terms used but not
defined in this Note are used herein as defined in the Indenture.

Section 11.  GOVERNING LAW.  THIS NOTE SHALL BE
GOVERNED BY AND CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK.

Source: [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00110-of-00352.parquet"}, [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00110-of-00352.parquet"}]]