Document:

EXHIBIT 4.1

                       THE MAY DEPARTMENT STORES COMPANY

                                       and

                             THE BANK OF NEW YORK

                                 Rights Agent

                             ______________________

                     Amended and Restated Rights Agreement

                          Dated as of August 31, 2004

                                 TABLE OF CONTENT

Section 1.  Certain Definitions. . . . . . . . . . . . . . . . . . . . . . . . 2
  (a)  Acquiring Person. . . . . . . . . . . . . . . . . . . . . . . . . . . . 3
  (b)  Affiliate and Associate. . . . . . . . . . . . . . . . . . . . . . . . .3
  (c)  Beneficial Owner. . . . . . . . . . . . . . . . . . . . . . . . . . . . 3
  (d)  Business Day. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5
  (e)  Close of business. . . . . . . . . . . . . . . . . . . . . . . . . . . .5
  (f)  Common Stock. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5
  (g)  Flip-In Event. . . . . . . . . . . . . . . . . . . . . . . . . . . . . .5
  (h)  Flip-Over Event. . . . . . . . . . . . . . . . . . . . . . . . . . . . .5
  (i)  Person. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5
  (j)  Preferred Stock. . . . . . . . . . . . . . . . . . . . . . . . . . . . .5
  (k)  Qualified Offer. . . . . . . . . . . . . . . . . . . . . . . . . . . . .5
  (l)  Stock Acquisition Date. . . . . . . . . . . . . . . . . . . . . . . .  .6
  (m)  Subsidiary. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 6
  (n)  Triggering Event. . . . . . . . . . . . . . . . . . . . . . . . . . . . 6

Section 2.  Appointment of Rights Agent. . . . . . . . . . . . . . . . . . . . 6

Section 3.  Issue of Right Certificates. . . . . . . . . . . . . . . . . . . . 6
  (a) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .6
  (b) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .7

Section 4.  Form of Right Certificates. . . . . . . . . . . . . . . . . . . . .8
  (a) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .8
  (b) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .8

Section 5.  Countersignature and Registration. . . . . . . . . . . . . . . . . 9
  (a) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .9
  (b) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 10

Section 6.  Transfer, Split Up, Combination and Exchange of Right
Certificates; Mutilated, Destroyed, Lost or Stolen Right
Certificates. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 10
  (a) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 10
  (b) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 11

                                       i

Section 7.  Exercise of Rights; Purchase Price; Expiration Date of
Rights . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .11
  (a) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 11
  (b) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 11
  (c) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 11
  (d) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 12
  (e) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 13
  (f) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 13

Section 8.  Cancellation and Destruction of Right Certificates . . . . . . . .14

Section 9.  Reservation and Availability of Capital Stock . . . . . . . . . . 14
  (a) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 14
  (b) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 14
  (c) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 14
  (d) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 15
  (e) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 15

Section 10.  Preferred Stock Record Date . . . . . . . . . . . . . . . . . . .16

Section 11.  Adjustment of Purchase Price, Number and Kind of
Shares or Number of Rights . . . . . . . . . . . . . . . . . . . . . . . . . .16

  (a) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 17
  (b) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 21
  (c) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 22
  (d) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 23
  (e) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 25
  (f) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 25
  (g) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 26
  (h) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 26
  (I) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 26
  (j) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 27

                                       ii

  (k) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 27
  (l) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 27
  (m) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 28
  (n) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 28
  (o) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 29
  (p) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 29

Section 12.  Certificate of Adjusted Purchase Price or Number of
Shares . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .29

Section 13.  Consolidation, Merger or Sale or Transfer of Assets,
Cash Flow or Earning Power . . . . . . . . . . . . . . . . . . . . . . . . . .30
  (a) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 30
  (b) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 31
  (c) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 32
  (d) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 34

Section 14.  Fractional Rights and Fractional Shares . . . . . . . . . . . . .34
  (a) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 34
  (b) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 35
  (c) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 36
  (d) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 36

Section 15.  Rights of Action . . . . . . . . . . . . . . . . . . . . . . . . 36

Section 16.  Agreement of Rights Holders . . . . . . . . . . . . . . . . . . .37
  (a) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 37
  (b) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 37
  (c) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 37
  (d) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 37

Section 17.  Right Certificate Holder Not Deemed a Shareowner . . . . . . . . 37

Section 18.  Concerning the Rights Agent . . . . . . . . . . . . . . . . . . .38
  (a) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 38
  (b) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 38

                                       iii

Section 19.  Merger or Consolidation or Change of Name of Rights
Agent . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 38
  (a) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 39
  (b) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 39

Section 20.  Duties of Rights Agent . . . . . . . . . . . . . . . . . . . . . 39
  (a) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 39
  (b) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 40
  (c) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 40
  (d) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 40
  (e) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 40
  (f) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 41
  (g) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 41
  (h) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 41
  (I) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 41
  (j) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 41
  (k) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 42
  (l) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 42
  (m) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 42
  (n) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 42

Section 21.  Change of Rights Agent . . . . . . . . . . . . . . . . . . . . . 43

Section 22.  Issuance of New Right Certificates . . . . . . . . . . . . . . . 44

Section 23.  Redemption and Termination . . . . . . . . . . . . . . . . . . . 44
  (a) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 44
  (b) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 45

Section 24.  Exchange . . . . . . . . . . . . . . . . . . . . . . . . . . . . 46
  (a) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 46
  (b) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 46
  (c) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 47
  (d) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 47

                                       iv

Section 25.  Notice of Certain Events . . . . . . . . . . . . . . . . . . . . 47
  (a) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 47
  (b) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 48

Section 26.  Notices . . . . . . . . . . . . . . . . . . . . . . . . . . . . .49

Section 27.  Supplements and Amendments . . . . . . . . . . . . . . . . . . . 49

Section 28.  Successors . . . . . . . . . . . . . . . . . . . . . . . . . . . 51

Section 29.  Determinations and Actions by the Board of Directors,
etc . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 51

Section 30.  Benefits of this Agreement . . . . . . . . . . . . . . . . . . . 51

Section 31.  Severability . . . . . . . . . . . . . . . . . . . . . . . . . . 51

Section 32.  Governing Law . . . . . . . . . . . . . . . . . . . . . . . . . .52

Section 33.  Counterparts . . . . . . . . . . . . . . . . . . . . . . . . . . 52

Section 34.  Descriptive Headings . . . . . . . . . . . . . . . . . . . . . . 52

Exhibit A    Form of Right Certificate . . . . . . . . . . . . . . . . . . . .54

                                      v

                    AMENDED AND RESTATED RIGHTS AGREEMENT

     AMENDED AND RESTATED RIGHTS AGREEMENT, dated as of August 31,
2004 (the "Agreement"), between THE MAY DEPARTMENT STORES COMPANY,
a Delaware corporation (the "Company"), and THE BANK OF NEW YORK, a
banking company organized under the laws of New York (the "Rights
Agent").

                             W I T N E S S E T H

     WHEREAS, on February 21, 1986, the Board of Directors of The
May Department Stores Company, a New York corporation ("May-NY")
authorized and declared a dividend distribution of one Right for
each share of common stock of May-NY outstanding at the close of
business on March 3, 1986 (the "1986 Record Date"), and authorized
the issuance of one Right (as such number was subsequently adjusted
pursuant to the provisions of Section 11(p) of the Rights
Agreement, dated as of February 21, 1986 (the "1986 Agreement"), as
amended and restated as of May 2, 1988, and as amended on May 11,
1993 (the "1988 Agreement"), between May-NY and the Rights Agent)
for each share of common stock of May-NY issued between the 1986
Record Date (whether originally issued or delivered from the
Company's treasury) and the Distribution Date (as defined in the
1988 Agreement), each Right initially representing the right to
purchase one one-hundredth of a Junior Participating Preference
Share of May-NY having the rights, powers and preferences set forth
in the Certificate of Incorporation of May-NY, as restated and
filed with the Secretary of State of the State of New York on March
22, 1994, and as it may be amended from time to time hereafter (the
"May-NY Certificate of Incorporation"), upon the terms and subject
to the conditions set forth in the 1988 Agreement (the "1988
Rights");

     WHEREAS, on April 15, 1988, the Board of Directors of May-NY,
in accordance with Section 26 of the 1986 Agreement, determined it
desirable and in the best interests of May-NY and its shareowners
for May-NY to supplement and amend certain provisions of the 1986
Agreement and on May 2, 1988 implemented such amendments by
executing the 1988 Agreement;

     WHEREAS, effective as of May 11, 1993, May-NY executed an
"Amendment to Rights Agreement" to reflect formally the appointment
of The Bank of New York as transfer agent for all of the issued and

                                       1

outstanding stock of May-NY and as Rights Agent under the 1988
Rights Agreement;

     WHEREAS, on August 19, 1994, the Board of Directors of May-NY
extended the 1988 Agreement and authorized and declared a dividend
distribution of one Right for each share of common stock of May-NY
outstanding upon the expiration date of the 1988 Agreement (the
"Record Date"), and authorized the issuance of one Right (as such
number was subsequently adjusted pursuant to the provisions of
Section 11(p) of the Rights Agreement, dated as of August 19, 1994
between May-NY and the Rights Agent (the "1994 Agreement")) for
each share of common stock of May-NY issued between the Record Date
(whether originally issued or delivered from May-NY's treasury) and
the distribution date defined in the 1994 Agreement, each Right
initially representing the right to purchase one four-hundredth of
a Junior Participating Preference Share of May-NY having the
rights, powers and preferences set forth in the May-NY Certificate
of Incorporation (the "Rights");

     WHEREAS, effective as of May 24, 1996, May-NY executed an
"Assignment and Assumption Agreement" to reflect formally (i) the
reincorporation of the publicly traded entity from New York to
Delaware by means of a statutory share exchange pursuant to which
each share of common stock of May-NY with its associated Right was
exchanged for a share of Common Stock (as hereinafter defined) of
the Company with its associated Right, having the rights, powers
and preferences set forth in the Company's Amended and Restated
Certificate of Incorporation dated May 22, 1996, as it may be
amended from time to time (the "Certificate of Incorporation"), and
(ii) the assignment to and assumption by the Company of all of the
rights and obligations of May-NY under the 1994 Agreement;

     WHEREAS, on August 20, 2004, the Board of Directors of the
Company determined it desirable and in the best interests of the
Company and its shareowners for the Company to extend the 1994
Agreement and to amend certain provisions of the 1994 Agreement,
and on August 31, 2004 the Company implemented such amendments by
executing this Agreement

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

     Section 1.  Certain Definitions.  For purposes of this
Agreement, the following terms have the meanings indicated:

                                       2

     (a)  "Acquiring Person" shall mean any Person (as such term is
hereinafter defined) who or which, together with all Affiliates (as
such term is hereinafter defined) and Associates (as such term is
hereinafter defined) of such Person, shall be the Beneficial Owner
(as such term is hereinafter defined) of 15% or more of the shares
of Common Stock then outstanding, but shall not include the
following "exempted" Persons:

           (i)  the Company,

           (ii)  any Subsidiary of the Company,

           (iii)  any employee benefit plan of the Company or of any
     Subsidiary of the Company, or any Person or entity organized,
     appointed or established by or for the Company for, or
     pursuant to the terms of, any such plan, or

           (iv)  any such Person who has reported or is required to
     report such ownership (but less than 20%) on Schedule 13G
     under the Securities and Exchange Act of 1934, as amended and
     in effect on the date of this Agreement (the "Exchange Act")
      (or any comparable or successor report) or on Schedule 13D
     under the Exchange Act (or any comparable or successor report)
     which Schedule 13D does not state any intention to or reserve
     the right to control or influence the management or policies
     of the Company or engage in any of the actions specified in
     Item 4 of such schedule (other than the disposition of the
     Common Stock ) and, within 10 Business Days of being requested
     by the Company to advise it regarding the same, certifies to
     the Company that such Person acquired shares of Common Stock
     in excess of 14.9% inadvertently or without knowledge of the
     terms of the Rights and who, together with all Affiliates and
     Associates, thereafter does not acquire additional shares of
     Common Stock while the Beneficial Owner of 15% or more of the
     shares of Common Stock then outstanding; provided, however,
     that if the Person requested to so certify fails to do so
     within 10 Business Days, then such Person shall become an
     Acquiring Person immediately after such 10-Business-Day
     period.

      (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.

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

                                       3

           (i)  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 be deemed 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 issuable upon exercise of Rights at any time
     prior to the occurrence of a Triggering Event, or (C)
     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;

          (ii)  which such Person or any of such Person's
     Affiliates or Associates, directly or indirectly, has the
     right to vote or dispose of or has "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 (ii) 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 a Schedule 13D under
     the Exchange Act (or any comparable or successor report); or

           (iii)  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

                                       4

     acquiring, holding, voting (except pursuant to a revocable
     proxy as described in the proviso to subparagraph (ii) 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 deemed the "Beneficial Owner" of, or to be
     deemed to "beneficially own," any securities acquired through
     such Person's participation in good faith in a firm commitment
     underwriting until the expiration of forty calendar days after
     the date of such acquisition.

      (d)  "Business Day" shall mean any day other than a Saturday,
Sunday or a day on which banking institutions in the State of New
York 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
$.50 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)  "Flip-In Event" shall mean any event described in Section
11(a)(ii)(A) or (B) hereof.

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

      (i)  "Person" shall mean any individual, firm, corporation,
partnership or other entity whether organized under the laws of the
United States of America or any state or territory thereof or under
the laws of any other country or political subdivision thereof.

      (j)  "Preferred Stock" shall mean the Junior Participating
Preference Shares, par value $.50 per share, of the Company.

      (k)  "Qualified Offer" shall have the meaning set forth in
Section 11(a)(ii) hereof.

                                       5

      (l)  "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 other than pursuant to a
Qualified Offer.

      (m)  "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.

      (n)  "Triggering Event" shall mean any Flip-In Event or any
Flip-Over Event.

     Section 2.  Appointment of Rights Agent.  The Company has
appointed the Rights Agent to act as agent for the Company and the
holders of the Rights (who, in accordance with Section 3 hereof,
shall prior to the Distribution Date also be the holders of the
Common Stock) in accordance with the terms and conditions hereof,
and the Rights Agent has accepted such appointment.  The Company
may from time to time appoint such Co-Rights Agents as it may deem
necessary or desirable.

     Section 3.  Issue of Right Certificates.

     (a)  Until the earlier of (i) the Close of business on the
tenth Business Day after the Stock Acquisition Date, or (ii) the
Close of business on the tenth Business Day after the date that a
tender or exchange offer by any Person (other than an "exempted"
Person) is first published or sent or given 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
become an Acquiring Person, in either instance other than pursuant
to a Qualified Offer (the earlier of (i) and(ii) being herein
referred to as the "Distribution Date"),

     (x) the Rights will be evidenced (except as provided below) 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

                                       6

     (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).

As soon as practicable after the Distribution Date, the Rights
Agent will send by first-class, 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 right certificates, in
substantially the form of Exhibit A hereto (the "Right
Certificates"), evidencing one Right for each share of Common Stock
so held, subject to adjustment as provided herein.  At the time of
distribution of the Right Certificates, the Company shall make the
necessary and appropriate rounding adjustments (in accordance with
Section 14(a) hereof) so that Right 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 Right Certificates.

      (b)  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 issued after the Record Date representing such shares
of Common Stock shall also be deemed to be certificates for Rights.
Certificates issued after the Record Date representing shares of
Common Stock shall bear the following legend:

     This certificate evidences and entitles the holder hereof
     to certain Rights as set forth in the Rights Agreement
     between The May Department Stores Company (the "Company")
     and the Rights Agent (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

                                       7

     such Person or by any subsequent holder, may become null
     and void.

With respect to such certificates containing the foregoing legend,
and certificates containing the legends specified in the 1986
Agreement, the 1988 Agreement and the 1994 Agreement and with
respect to previously issued certificates that contain no
comparable 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 the registered holders of Common Stock shall
also 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.

     Section 4.  Form of Right Certificates.

      (a)  The Right 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 A
hereto and may have such marks of identification or designation and
such legends, summaries or endorsements printed thereon as the
Company may deem appropriate and as are not inconsistent with the
provisions of this Agreement, 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 Right 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 six-hundredths of a
share of Preferred Stock as shall be set forth therein at the price
set forth therein (such exercise price per one six-hundredth of a
share is referred to herein as 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 Right Certificate issued pursuant to Section 3(a),
Section 11(i) 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

                                        8

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 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 Right Certificate
issued pursuant to Section 6 or Section 11 hereof upon transfer,
exchange, replacement or adjustment of any other Right Certificate
referred to in this sentence, shall contain (to the extent
feasible) the following legend:

     The Rights represented by this Right 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.

     Section 5.  Countersignature and Registration.

     (a)  The Right 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
Right Certificates shall be countersigned by the Rights Agent,
either manually or by facsimile signature, 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 Right Certificates
shall cease to be such officer of the Company before
countersignature by the Rights Agent and issuance and delivery by
the Company, such Right 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 Right Certificates had not ceased to be such officer of
the Company; and any Right Certificates may be signed on behalf of
the Company by any person who, at the actual date of the execution
of such Right Certificate, shall be a proper officer of the Company
to sign such Right Certificate, although at the date of the

                                       9

execution of this Rights Agreement any such person was not such an
officer.

      (b)  Following the Distribution Date, the Rights Agent will
keep or cause to be kept, at one of its offices in New York, New
York, books for registration and transfer of the Right Certificates
issued hereunder.  Such books shall show the names and addresses of
the respective holders of the Right Certificates, the number of
Rights evidenced on its face by each of the Right Certificates, the
certificate number of each of the Right Certificates and the date
of each of the Right Certificates.

     Section 6.  Transfer, Split Up, Combination and Exchange of
Right Certificates; Mutilated, Destroyed, Lost or Stolen Right
Certificates.  (a)  Subject to the provisions of Section 4(b),
Section 7(e) and Section 14 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 Right Certificate or
Certificates may be transferred, split up, combined or exchanged
for another Right Certificate or Certificates, entitling the
registered holder to purchase a like number of one six-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 Right Certificate or Certificates surrendered then
entitle 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 Right Certificate or Certificates shall
make such request in writing delivered to the Rights Agent, and
shall surrender the Right 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.
Neither the Rights Agent nor the Company shall be obligated to take
any action whatsoever with respect to the transfer of any such
surrendered Right Certificate until the registered holder shall
have completed and signed the certificate contained in the form of
assignment on the reverse side of such Right Certificate and shall
have provided such additional evidence of the identity of the
Beneficial Owner (or former Beneficial Owner) or Affiliates or
Associates thereof as the Company shall reasonably request.
Thereupon the Rights Agent shall, subject to Section 4(b), Section
7(e) and Section 14 hereof, countersign and deliver to the Person
entitled thereto a Right Certificate or 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 Right Certificates.

                                       10

      (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 Right 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 Right
Certificate if mutilated, the Company will execute and deliver a
new Right Certificate of like tenor to the Rights Agent for
countersignature and delivery to the registered owner in lieu of
the Right 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 Right 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), Section 23(a) and Section 24
hereof) in whole or in part at any time after the Distribution Date
upon surrender of the Right Certificate, with the form of election
to purchase and the certificate on the reverse side thereof duly
executed, to the Rights Agent at the principal 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 six-hundredths of a share of Preferred Stock (or other
securities, cash or property, as the case may be) as to which such
surrendered Rights are then exercisable, at or prior to the earlier
of (i) the close of business on August 31, 2014 (the "Final
Expiration Date"), or (ii) the time at which the Rights are
redeemed as provided in Section 23 hereof (the earlier of (i) and
(ii) being herein referred to as the "Expiration Date").

      (b)  The Purchase Price for each one six-hundredth of a share
of Preferred Stock pursuant to the exercise of a Right shall be
initially $125, 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 Right Certificate representing
exercisable Rights, with the form of election to purchase and the
certificate duly executed, accompanied by payment, with respect to
each Right so exercised, of the Purchase Price per one six-
hundredth 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, the

                                       11

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 six-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 six-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) requisition from the Company the amount of cash, if
     any, to be paid in lieu of fractional shares in accordance
     with Section 14 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 Right Certificate, registered
     in such name or names as may be designated by such holder, and

           (iv) after receipt thereof, deliver such cash, if any, to
     or upon the order of the registered holder of such Right
     Certificate.

The payment of the Purchase Price (as such amount may be reduced
pursuant to Section 11(a)(iii) hereof) shall be made in cash or by
certified bank check or money order payable to the order of the
Company.  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 Right Certificate
shall exercise less than all of the Rights evidenced thereby, a new
Right Certificate evidencing Rights equivalent to the Rights

                                      12

remaining unexercised shall be issued by the Rights Agent and
delivered to, or upon the order of, the registered holder of such
Right 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 Flip-In 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, 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 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 the avoidance of this Section 7(e), 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 ensure 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 Right
Certificates or other Person as a result of its failure to make any
determinations with respect to an Acquiring Person or any of its
respective 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 upon the occurrence of any purported exercise as set forth
in this Section 7 unless such registered holder shall have (i)
completed and duly executed the certificate and the form of
election to purchase set forth on the reverse side of the Right
Certificate surrendered for such exercise, and (ii) provided such
additional evidence of the identity of the Beneficial Owner (or
former Beneficial Owner) or Affiliates or Associates thereof as the
Company shall reasonably request.

                                      13

     Section 8.  Cancellation and Destruction of Right
Certificates.  All Right 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
Right 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 Right Certificate purchased or acquired by the Company
otherwise than upon the exercise thereof.  The Rights Agent shall
deliver all cancelled Right Certificates to the Company or may, but
shall not be required to, destroy such cancelled Right
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, 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 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 Flip-In Event on which
     the consideration to be delivered by the Company upon exercise
     of the Rights has been determined in accordance with Section

                                      14

     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 (the "Securities
     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 Securities 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) calendar 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.  Notwithstanding any provision
of this Agreement to the contrary, the Rights shall not be
exercisable in any jurisdiction unless the requisite qualification
in such jurisdiction shall have been obtained.

      (d)  The Company covenants and agrees that it will take all
such action as may be necessary to ensure that all one six-
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 Right Certificates and of any certificates for
shares of Preferred Stock (or Common Stock and/or other securities,

                                      15

as the case may be) upon the exercise of Rights.  The Company shall
not, however, be required to pay any transfer tax which may be
payable in respect of any transfer or delivery of Right
Certificates to a Person other than, or the issuance or delivery of
a number of one six-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
Right Certificates evidencing Rights surrendered for exercise or to
issue or deliver any certificates for a number of one six-
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 Right 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 six-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 the
whole or 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
Right Certificate evidencing such Rights was duly surrendered and
payment of the Purchase Price (and all applicable transfer taxes)
was 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 whole or fractional shares 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
Right Certificate, as such, shall not be entitled to any rights of
a shareowner 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

                                      16

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, (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) and Section 7(e) 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, the holder of such Right 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 Person shall, at any time after the Rights
          Dividend Declaration Date, become an Acquiring Person,
          unless the event causing such Person to become an
          Acquiring Person is a Flip-Over Event, or is an
          acquisition of shares of Common Stock pursuant to a
          tender offer or an exchange offer for all outstanding
          shares of Common Stock at a price and on terms determined
          by the Board of Directors of the Company, after receiving
          advice from one or more investment banking firms, to be

                                      17

          (a) at a price which is fair to the Company's shareowners
          (taking into account all factors which the Board of
          Directors deems relevant including, without limitation,
          prices which could reasonably be achieved if the Company
          or its assets were sold on an orderly basis designed to
          realize maximum value) and (b) otherwise in the best
          interests of the Company and its shareowners (a
          "Qualified Offer"), or

          (B)  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 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 the occurrence of any such Flip-In
Event, 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 a number of one six-
hundredths of a share 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 six-hundredths of a share of
Preferred Stock for which a Right was exercisable immediately
prior to the first occurrence of a Flip-In Event, and (y)
dividing that product (which, following such first occurrence,
shall thereafter be referred to as the "Purchase Price" for
each Right for all purposes of this Agreement) by 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 being referred to herein as
the "Adjustment Shares").

                                      18

      (iii)  In the event that the number of shares of Common
Stock which are authorized by the Certificate of Incorporation
but not outstanding or reserved for issuance for purposes
other than upon exercise of the Rights is 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 being referred to herein as 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 being referred to herein as "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, that if the Company shall not have
          made adequate provision to deliver value pursuant to
          clause (B) above within thirty (30) calendar days
          following the later of (x) the first occurrence of a
          Flip-In 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
          "Flip-In 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, 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) calendar day period set forth

                                      19

          above may be extended to the extent necessary, but not
          more than ninety (90) calendar days following the Flip-In
          Trigger Date, in order that the Company may seek
          shareowner approval for the authorization of such
          additional shares (such period, as it may be extended
          being referred to herein as 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 Flip-In 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.

           (iv)  If the rules of the national securities exchange,
     registered as such pursuant to Section 6 of the Exchange Act,
     or of the national securities association, registered as such
     pursuant to Section 15A of the Exchange Act, on which the
     Common Stock is principally traded would prohibit such
     exchange or association from listing or continuing to list, or
     from authorizing for or continuing quotation and/or
     transaction reporting through an inter-dealer quotation
     system, the Common Stock or other equity securities of the
     Company if the Rights were to be exercised for shares of
     Common Stock in accordance with subparagraph (ii) of this
     Section 11(a) because such issuance would nullify, restrict or
     disparately reduce the per share voting rights of holders of
     Common Stock, the Company shall:

           (A) determine the Spread, and

                                      20

          (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) equity
          securities of the Company, including, without limitation,
          "common stock equivalents," other than securities which
          would have the effect of nullifying, restricting or
          disparately reducing the per share voting rights of
          holders of Common Stock, (3) debt securities of the
          Company, (4) other assets, or (5) 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; provided, however, if
          the Company shall not have made adequate provision to
          deliver value pursuant to clause (B) above within thirty
          (30) calendar days following the Flip-In 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, cash having an aggregate
          value equal to the Spread.

     To the extent that the Company determines that some action
     need be taken pursuant to the first sentence of this Section
     11(a)(iv), 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, but not longer than ninety (90) calendar days
     after the Flip-In Trigger Date, in order 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)(iv), 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 Flip-In 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

                                      21

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).
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 conclusive for all purposes and 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 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 quarterly 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

                                      22

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.  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) or
          (iv) 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) or (iv) 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 ex-dividend date
          for such dividend or distribution, or the record date for
          such subdivision, combination or reclassification, then,

                                      23

          and in each such case, the "current market price" shall
          be properly adjusted to take into account ex-dividend
          trading.  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 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

                                      24

          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 600 (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 six-hundredth of a share of Preferred Stock shall be
          equal to the "current market price" of one share of
          Preferred Stock divided by 600.

      (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

                                      25

time in a manner and on terms as nearly equivalent as practicable
to the provisions with 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 six-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 six-hundredths of a
share of Preferred Stock (calculated to the nearest one-millionth)
obtained by (i) multiplying (x) the number of one six-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 six-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 six-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 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 Right Certificates have
been issued, shall be at least ten (10) calendar days later than
the date of the public announcement.  If Right Certificates have

                                      26

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 Right
Certificates on such record date Right 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 Right
Certificates held by such holders prior to the date of adjustment,
and upon surrender thereof, if required by the Company, new Right
Certificates evidencing all the Rights to which such holders shall
be entitled after such adjustment.  Right Certificates so to be
distributed shall be issued, executed and countersigned 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 Right 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 six-hundredths of a share of Preferred
Stock issuable upon the exercise of the Rights, the Right
Certificates theretofore and thereafter issued may continue to
express the Purchase Price per one six-hundredth of a share and the
number of one six-hundredths of a share which were expressed in the
initial Right Certificates issued hereunder.

      (k)  Before taking any action that would cause an adjustment
reducing the Purchase Price below the then stated value, if any, of
the number of one six-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 six-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
until the occurrence of such event the issuance to the holder of
any Right exercised after such record date the number of one six-
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 six-hundredths of a share of Preferred
Stock and other capital stock or securities of the Company, if any,

                                      27

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
its 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 dividends 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 shareowners.

      (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 transactions, assets,
cash flow or earning power aggregating more than 50% of the assets,
cash flow 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
shareowners of the Person who constitutes the "Principal Party" for
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.

                                      28

      (o)  The Company covenants and agrees that, after the
Distribution Date, it will not, except as permitted by Section 23
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 or Section 13 hereof, the Company shall (a) promptly prepare a
certificate setting forth such adjustment and a brief statement of
the facts 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 Right Certificate
(or, if prior to the Distribution Date, to each holder of a
certificate representing shares of Common Stock) in accordance with
Section 25 hereof.  The Rights Agent shall be fully protected in

                                      29

relying on any such certificate and on any adjustment therein
contained.

     Section 13.  Consolidation, Merger or Sale or Transfer of
Assets, Cash Flow 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
          property, or

          (z) the Company (or one or more of its Subsidiaries) shall
          sell, mortgage (except in bona fide financing transactions in
          the ordinary course of business) or otherwise transfer in one
          transaction or a series of transactions, assets, cash flow or
          earning power aggregating more than 50% of the assets, cash
          flow 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 (except as may be contemplated by
Section 13(d) hereof), 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, non-assessable and
          freely tradeable shares of Common Stock of the Principal Party
          (as such term is hereinafter defined), not subject to any

                                      30

          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 six-hundredths of a share of Preferred Stock for which a
          Right is exercisable immediately prior to the first occurrence
          of any such Flip-Over Event (or, if a Flip-In Event has
          occurred prior to the first occurrence of a Flip-Over Event,
          multiplying the number of such one six-hundredths of a share
          for which a Right was exercisable immediately prior to the
          first occurrence of a Flip-In 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 Flip-Over Event, shall be referred to as the "Purchase
          Price" for each Right for all purposes of this Agreement) by
          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 Flip-Over
          Event;

           (ii) such Principal Party shall thereafter be liable for,
     and shall assume, by virtue of such Flip-Over 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 Flip-
     Over 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; and

           (v) the provisions of Section 11(a)(ii) hereof shall be
     of no effect following the first occurrence of any Flip-Over
     Event.

     (b)  "Principal Party" shall mean

                                      31

           (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, or, if there is more than one such issuer, the
     issuer of the shares of Common Stock which have the greatest
     aggregate market value of shares outstanding and if no
     securities are so issued, (x) the Person that is the other
     party to such merger or consolidation if the Person survives
     the merger, or if there is more than one such Person, the
     Person the shares of Common Stock of which have the greatest
     aggregate market value of shares outstanding, or (y) if the
     Person that is the other party to the merger does not survive
     the merger, the Person that does survive the merger, or (z)
     the Person resulting from the consolidation; and

           (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, cash
     flow or earning power transferred pursuant to such transaction
     or transactions, or, if each Person that is a party to such
     transaction or transactions receives that same portion of the
     assets, cash flow or earning power so transferred or if the
     Person receiving the greatest portion of the assets or earning
     power cannot be determined, whichever of such Persons as is
     the issuer of Common Stock having the greatest aggregate
     market value of shares outstanding;

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; 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)  The Company shall not consummate any Flip-Over Event
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

                                      32

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 such Flip-Over Event, the Principal Party will

           (i)  prepare and file a registration statement under the
     Securities 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 Securities Act) until
     the Expiration Date and take all such other action as may be
     necessary to enable the Principal Party to issue the
     securities purchasable upon exercise of the Rights, including,
     but not limited to the registration or qualification of such
     securities under all requisite securities laws or
     jurisdictions of the various states and the listing of such
     securities on such exchange and trading markets as may be
     necessary or appropriate;

           (ii)  use its best efforts, if the Common Stock of the
     Principal Party shall be listed or admitted to trading on the
     New York Stock Exchange or on another national securities
     exchange, to list or admit to trading (or continue the listing
     of) the Rights and the securities purchasable upon exercise of
     the Rights on the New York Stock Exchange or such other
     securities exchange, or, if the Common Stock of the Principal
     Party shall not be listed or admitted to trading on the New
     York Stock Exchange or a national securities exchange, to
     cause the Rights and the securities receivable upon exercise
     of the Rights to be reported by such other system then in use;

           (iii)  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 (or any successor form) under the
     Exchange Act; and

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

The provisions of this Section 13 shall similarly apply to
successive Flip-Over Events.  In the event that a Flip-Over Event

                                33

shall occur at any time after the occurrence of a Flip-In Event,
the Rights which have not theretofore been exercised shall
thereafter become exercisable in the manner described in Section
13(a).

      (d)  Notwithstanding anything in this Agreement to the
contrary, Section 13 shall not be applicable to a transaction
described in clause (x) or (y) of the first sentence of Section
13(a) if

           (i)  such transaction is consummated with a Person or
     Persons who acquired shares of Common Stock pursuant to a
     tender offer or exchange offer for all outstanding shares of
     Common Stock which is a Qualified Offer as such term is
     defined in Section 11(a)(ii)(A) hereof (or a wholly owned
     subsidiary of any such Person or Persons),

           (ii) the price per share of Common Stock offered in such
     transaction is not less than the price per share of Common
     Stock paid to all holders of shares of Common Stock whose
     shares were purchased pursuant to such tender offer or
     exchange offer, and

           (iii) the form of consideration being offered to the
     remaining holders of shares of Common Stock pursuant to such
     transaction is the same as the form of consideration paid
     pursuant to such tender offer or exchange offer.

Upon consummation of any such transaction contemplated by this
Section 13(d), all Rights hereunder shall expire.

     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 Right Certificates which
evidence fractional Rights.  If the Company decides not to issue
fractional Rights, there shall be paid in lieu thereof to the
registered holders of the Right 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 Trading Day shall be the last

                                      34

sale price, regular way, or, in case no such sale takes place on
such Trading 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 six-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 six-hundredth of a share of Preferred
Stock).  Interests in fractions of Preferred Stock in integral
multiples of one six-hundredths of a share of Preferred Stock may,
at the election of the Company, be evidenced by depositary
receipts, pursuant to an appropriate agreement between the Company
and a depositary selected by it; provided, however, that such
agreement shall provide that the holders of such depositary
receipts shall have all the rights, privileges and preferences to
which they are entitled as beneficial owners of the Preferred Stock
represented by such depositary receipts.  If the Company decides
not to issue fractional shares of Preferred Stock that are not
integral multiples of one six-hundredth of a share of Preferred
Stock, there shall be paid in lieu thereof to the registered
holders of Right 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 six-hundredth of a share of

                                      35

Preferred Stock.  For purposes of this Section 14(b), the current
market value of one six-hundredth of a share of Preferred Stock
shall be one six-hundredth of the closing price of a share of
Preferred Stock (as 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.  If
the Company decides not to issue fractional shares of Common Stock,
there shall be paid in lieu thereof to the registered holders of
Right 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 (1)
share of Common Stock shall be the closing price of one (1) 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)  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 are vested in the respective registered
holders of the Right Certificates (and, prior to the Distribution
Date, the registered holders of the Common Stock); and any
registered holder of any Right 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 Right Certificate (or,
prior to the Distribution Date, of the Common Stock), may, in such
holder's own behalf and for such holder's own benefit, enforce, and
may institute and maintain any suit, action or proceeding against
the Company to enforce, or otherwise act in respect of, such
holder's right to exercise the Rights evidenced by such Right
Certificate in the manner provided in such Right 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 of this Agreement and shall be entitled to specific
performance of the obligations hereunder and injunctive relief
against actual or threatened violations of the obligations
hereunder of any Person subject to this Agreement.

                                      36

     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 Right 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 a
proper instrument of transfer and with the appropriate forms and
certificates fully executed;

      (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 Right 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 Right 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, subject to the last
sentence of Section 7(e) hereof, shall be required to be affected
by any notice to the contrary; and

      (d)  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, decree or ruling issued by a court of competent
jurisdiction or by a governmental, 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 shall be required to use
its best efforts to have any such order, decree or ruling lifted,
overturned or otherwise removed as soon as possible.

     Section 17.  Right Certificate Holder Not Deemed a Shareowner.
No holder, as such, of any Right Certificate shall be entitled to
vote, receive dividends or be deemed for any purpose the holder of
the number of one six-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

                                      37

shall anything contained herein or in any Right Certificate be
construed to confer upon the holder of any Right Certificate, as
such, any of the rights of a shareowner of the Company or any right
to vote for the election of directors or upon any matter submitted
to shareowners at any meeting thereof, or to give or withhold
consent to any corporate action, or to receive notice of meetings
or other actions affecting shareowners (except as provided in
Section 24 hereof), or to receive dividends or subscription rights,
or otherwise, until the Right or Rights evidenced by such Right
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 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, or expense, incurred without
negligence, bad faith or willful misconduct on the part of the
Rights Agent, for anything done or omitted to be done by the Rights
Agent in connection with the acceptance and administration of this
Agreement, including the costs and expenses of defending against
any claim of liability in connection therewith; provided, however,
that the Rights Agent shall also be indemnified and held harmless
against any loss, liability or expense incurred as a result of a
claim for indirect, special, consequential or punitive damages.
The provisions of this Section 18(a) shall survive the termination
of this Agreement.

      (b)  The Rights Agent shall be protected and shall incur no
liability for or in respect of any action taken, suffered or
omitted to be taken by it in connection with its administration of
this Agreement in reliance upon any Right 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.

     Section 19.  Merger or Consolidation or Change of Name of
Rights Agent.

                                      38

      (a)  Any corporation into which the Rights Agent or any
successor Rights Agent may be merged or with which it may be
consolidated, or any corporation resulting from any merger or
consolidation to which the Rights Agent or any successor Rights
Agent shall be a party, or any corporation succeeding to the
corporate trust or stock transfer 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 corporation 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
Right 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 Right Certificates so
countersigned; and in case at that time any of the Right
Certificates shall not have been countersigned, any successor
Rights Agent may countersign such Right Certificates either in the
name of the predecessor or in the name of the successor Rights
Agent; and in all such cases such Right Certificates shall have the
full force provided in the Right 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 Right Certificates shall have
been countersigned but not delivered, the Rights Agent may adopt
the countersignature under its prior name and deliver Right
Certificates so countersigned; and in case at that time any of the
Right Certificates shall not have been countersigned, the Rights
Agent may countersign such Right Certificates either in its prior
name or in its changed name; and in all such cases such Right
Certificate shall have the full force provided in the Right
Certificates and in this Agreement.

     Section 20.  Duties of Rights Agent.  The Rights Agent
undertakes the duties and obligations imposed by this Agreement
upon the following terms and conditions, by all of which the
Company and the holders of Right Certificates, by their acceptance
thereof, shall be bound:

     (a)  The Rights Agent may consult with legal counsel (who may
be legal counsel for the Company), and the opinion of such counsel
shall be full and complete authorization and protection to the

                                      39

Rights Agent as to any action taken or omitted to be taken by it in
good faith and in accordance with such 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 or suffering 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 authorization to the Rights Agent for any action taken or
suffered in good faith by it under the provisions of this Agreement
in reliance upon such certificate.

      (c)  The Rights Agent shall be liable hereunder only for its
own negligence, bad faith or willful misconduct; provided, however,
that the Rights Agent shall not be liable for indirect, special,
consequential or punitive damages.

      (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 Right Certificates or be required to verify the
same (except as to its countersignature on such Right
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 be under any responsibility in
respect of the validity of this Agreement or the execution and
delivery hereof (except the due execution hereof by the Rights
Agent) or in respect of the validity or execution of any Right
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 Right Certificate;
nor shall it be responsible for any adjustment required under the
provisions of Section 11 or Section 13 hereof or responsible for
the manner, method or amount of any such adjustment or the
ascertaining of the existence of facts that would require any such
adjustment (except with respect to the exercise of Rights evidenced
by Right Certificates after actual notice of any such adjustment);
nor shall it by any act hereunder be deemed to make any
representation or warranty as to the authorization or reservation

                                      40

of any shares of Common Stock or Preferred Stock to be issued
pursuant to this Agreement or any Right 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.

      (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 it shall not be liable for any action taken or suffered to be
taken by it in good faith in accordance with instructions of any
such officer.

      (h)  The Rights Agent and any shareowner, 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 it were not Rights
Agent under this Agreement.  Nothing herein shall preclude the
Rights Agent from acting in any other capacity for the Company or
for any other legal entity.

      (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 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 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

                                      41

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 attached
to the form of assignment or form of election to purchase, 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.

      (l)  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 or
omitted to be taken by the Rights Agent under this Agreement and
the date on and/or after which such action shall be taken or such
omission shall be effective.  The Rights Agent shall not be liable
for any action taken by, or omission of, the Rights Agent in
accordance with a proposal included in 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 any 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.

      (m)  In addition to the foregoing, the Rights Agent shall be
protected and shall incur no liability for, or in respect of, any
action taken or omitted to be taken by it in connection with its
administration of this Agreement if such acts or omissions are in
reliance upon (i) the proper execution of the certifications
concerning beneficial ownership appended to the form of assignment
and the form of election to purchase attached hereto unless the
Rights Agent shall have actual knowledge that, as executed, such
certification is untrue, or (ii) the non-execution of such
certification including, without limitation, any refusal to honor
any otherwise permissible assignment or election by reason of such
non-execution.

      (n)  The Company agrees to give the Rights Agent prompt
written notice of any event or ownership which would prohibit the
exercise or transfer of the Right Certificates.

                                      42

     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 five (5) calendar 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 Right Certificates by first-class mail.  The
Company may remove the Rights Agent or any successor Rights Agent
upon thirty (30) calendar 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 Right
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) calendar 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 Right Certificate (who shall, with such notice, submit
his Right Certificate for inspection by the Company), then the
Rights Agent or any registered holder of any Right Certificate may
apply to any court of competent jurisdiction for the appointment of
a new Rights Agent.  Any successor Rights Agent, whether appointed
by the Company or by such a court, shall be (a) a corporation
organized and doing business under the laws of the United States or
of the State of Missouri (or of any other state of the United
States so long as such corporation is authorized to do business in
the State of Missouri or the State of New York), in good standing,
having a principal office in the State of Missouri or the State of
New York, which is authorized under such laws to exercise corporate
trust or stock transfer 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 controlled by a
corporation described in clause (a) of this sentence.  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,

                                      43

and mail a notice thereof in writing to the registered holders of
the Right 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 Right Certificates.
Notwithstanding any of the provisions of this Agreement or of the
Rights to the contrary, the Company may, at its option, issue new
Right 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 Right
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 Right Certificates representing the
appropriate number of Rights in connection with such issuance or
sale; provided, however, that (i) no such Right 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 Right Certificate would be issued, and (ii) no such Right
Certificate shall be issued if, and to the extent that, appropriate
adjustment shall otherwise have been made in lieu of the issuance
thereof.

     Section 23.  Redemption and Termination.

      (a)  The Board of Directors of the Company may, at its option,
at any time prior to 5:00 p.m., New York time, on or before the
earlier of (i) the tenth Business Day following the Stock
Acquisition Date, as such period may be extended pursuant to
Section 26 hereof, or (ii) the Final Expiration Date, redeem all
but not less than all of the then outstanding Rights at a
redemption price of $.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").  The redemption of the Rights may be made effective at

                                      44

such time, on such basis and with such conditions as the Board of
Directors of the Company in its sole discretion may establish.  If,
following the occurrence of a Stock Acquisition Date and following
the expiration of the right of redemption hereunder but prior to
any Triggering Event,

           (i) a Person who is an Acquiring Person shall have
     transferred or otherwise disposed of a number of shares of
     Common Stock in one transaction, or series of transactions,
     not directly or indirectly involving the Company or any of its
     Subsidiaries, which did not result in the occurrence of a
     Triggering Event such that such Person is thereafter a
     Beneficial Owner of 10% or less of the outstanding shares of
     Common Stock, and

           (ii) there are no other Persons, immediately following
     the occurrence of the event described in clause (i), who are
     Acquiring Persons,

then the right of redemption shall be reinstated and thereafter be
subject to the provisions of this Section 23.  Notwithstanding
anything contained in this Agreement to the contrary, the Rights
shall not be exercisable after the first occurrence of a Flip-In
Event until such time as the Company's right of redemption
hereunder has expired.  The Company may, at its option, pay the
Redemption Price in cash, shares of Common Stock (based on the
"current market price", as defined in Section 11(d)(i) hereof, of
the Common Stock at the time of redemption) or any other form of
consideration deemed appropriate by the Board of Directors.

      (b)  Immediately upon the action of the Board of Directors of
the Company ordering the redemption of the Rights, evidence of
which shall have been filed with the Rights Agent 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
ordering the redemption of the Rights, the Company shall give
notice of such redemption to the Rights Agent and the holders of
the then outstanding Rights by mailing such notice to all such
holders at each holder's last address as it appears 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

                                      45

notice.  Each such notice of redemption will state the method by
which the payment of the Redemption Price will be made.

     Section 24.  Exchange.

     (a)  The Company may, at its option, at any time and from time
to time after a Flip-In Event, exchange all or part of the then
outstanding and exercisable Rights (which shall not include Rights
that have become void pursuant to the provisions of Section 7(e)
hereof) by exchanging for each such Right one share of Common
Stock, appropriately adjusted to reflect a stock split, stock
dividend or similar transaction occurring after the date of such
Flip-In Event (such amount per Right being hereinafter referred to
as the "Exchange Consideration".  Notwithstanding the foregoing,
the Company shall not be empowered to effect such exchange at any
time after any Person, together with all Affiliates and Associates
of such Person, becomes the Beneficial Owner of shares of Common
Stock aggregating more than 50% or more of the shares of Common
Stock then outstanding.  From and after the occurrence of a Flip-
Over Event, any Rights that theretofore have not been exchanged
pursuant to this Section 24 shall thereafter be exercisable only in
accordance with Section 13 and may not be exchanged pursuant to
this Section 24(a).

     (b)  Immediately upon the action of the Company ordering the
exchange of any Rights pursuant to paragraph (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 the Exchange
Consideration.  The Company shall promptly 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 promptly mail a notice of any such
exchange to all holders of the Rights so exchanged 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 shares of 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.

                                      46

     (c)  The Company may at its option substitute, and, 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 this Section
24, the Company shall substitute to the extent of such
insufficiency, for each share of Common Stock to be issuable upon
exchange of a Right, a number of shares of "common stock
equivalents" having an aggregate current per share market price
(determined pursuant to Section 11(d) hereof) equal to the current
per share market price of one share of Common Stock (determined
pursuant to Section 11(d) hereof) as of the date of the Flip-In
Event.

     (d)  The Company shall not, in connection with any exchange
pursuant to this Section 24, 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, the Company shall pay to the registered
holders of the Right 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 market
value of a whole share of Common Stock.  For purposes of this
paragraph (d), the current market value of a whole share of Common
Stock shall be the closing price of a share of Common Stock (as
determined pursuant to Section 11(d) hereof) for the Trading Day
immediately prior to the date of exchange pursuant to this Section
24.

     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 quarterly cash dividend out of 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

                                      47

          (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 transactions, of more than 50% of
     the assets, cash flow 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,

then, in each such case, the Company shall give to each holder of a
Right Certificate, to the extent feasible and 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 twenty (20) calendar 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 twenty (20) calendar 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 Flip-In Event shall occur, then (i) the
Company shall as soon as practicable thereafter give to each holder
of a Right 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.

                                      48

     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 Right 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) or by facsimile (with receipt confirmed), as follows:

The May Department Stores Company
611 Olive Street
St. Louis, Missouri  63101
Attention:  Corporate Secretary
Fax:  314/641-4066

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 Right 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) or by facsimile (with receipt confirmed),
as follows:

The Bank of New York
101 Barclay Street
New York, New York 10286
Attention:  Robert J. Rinaudo
Fax:   212/815-6477

Notices or demands authorized by this Agreement to be given or made
by the Company or the Rights Agent to the holder of any Right
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.  Prior to the
Distribution Date and subject to the penultimate sentence of this
Section 27, 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 and
subject to the penultimate sentence of this Section 27, the Company
and the Rights Agent shall, if the Company so directs, supplement
or amend this Agreement without the approval of any holders of
Right Certificates in order

                                      49

          (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
     (including, without limitation, the period within which the
     Rights may be redeemed in accordance with Section 23 hereof)
     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 Right Certificates (other than an Acquiring Person
     or an Affiliate or Associate of an Acquiring Person),

provided, 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.
Notwithstanding anything contained in this Agreement to the
contrary, no supplement or amendment shall be made which changes
the Redemption Price, the Final Expiration Date, the Purchase Price
or the number of one six-hundredths of a share of Preferred Stock
for which a Right is exercisable; provided, however, that at any
time prior to (i) the existence of an Acquiring Person, or (ii) 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 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 plan) is first published or sent
or given 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 15% or more
of the shares of Common Stock then outstanding, the Board of
Directors of the Company may amend this Agreement to increase the
Purchase Price or extend the Final Expiration Date.  Prior to the
Distribution Date, the interests of the holders of Rights shall be

                                      50

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 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.

     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 Right
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 Right 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

                                      51

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 Right 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,
duties and obligations of the Rights Agent, hereunder, shall be
governed by 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 of such counterparts 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.

                                      52

     IN WITNESS WHEREOF, the parties hereto have caused this
Agreement to be duly executed and their respective corporate seals
to be hereunto affixed and attested, all as of August 31, 2004.

Attest:                              THE MAY DEPARTMENT STORES
                                       COMPANY

  By    /s/ Richard A. Brickon      By   /s/  Jan R. Kniffen
      Name: Richard A. Brickson        Name:  Jan R. Kniffen
     Title: Secretary                 Title:  Senior Vice President
                                               and Treasurer

Attest:                              THE BANK OF NEW YORK

  By   /s/ Margaret Lloyd           By   /s/  Robert J. Rinaudo
     Name: Margaret Lloyd              Name:  Robert J. Rinaudo
    Title: Assistant Vice             Title:  Assistant Vice
            President                          President

                                      53

                                   Exhibit A

                          [Form of Right Certificate]

Certificate No. R-                                       ________ Rights

     NOT EXERCISABLE AFTER AUGUST 31, 2014 OR EARLIER IF REDEEMED
     BY THE COMPANY.  THE RIGHTS ARE SUBJECT TO REDEMPTION, AT THE
     OPTION OF THE COMPANY, AT $.01 PER RIGHT ON THE TERMS SET
     FORTH IN THE RIGHTS AGREEMENT.   UNDER CERTAIN CIRCUMSTANCES,
     RIGHTS BENEFICIALLY OWNED BY AN ACQUIRING PERSON (AS SUCH TERM
     IS DEFINED IN THE RIGHTS AGREEMENT) AND ANY SUBSEQUENT HOLDER
     OF SUCH RIGHTS MAY BECOME NULL AND VOID.  [THE RIGHTS
     REPRESENTED BY THIS RIGHT 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 RIGHT
     CERTIFICATE AND THE RIGHTS REPRESENTED HEREBY MAY BECOME NULL
     AND VOID IN THE CIRCUMSTANCES SPECIFIED IN SECTION 7(e) OF
     SUCH AGREEMENT.]

                               Right Certificate

                       THE MAY DEPARTMENT STORES COMPANY

     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 Amended and Restated Rights
Agreement, dated as of August 27, 2004 (the "Rights Agreement"),
between The May Department Stores Company, a Delaware corporation
(the "Company"), and The Bank of New York, a banking company
organized under the laws of the State of New York (the "Rights
Agent"), to purchase from the Company at any time prior to 5:00
p.m. (New York time) on August 31, 2014 at the office or offices of
the Rights Agent designated for such purpose, or its successors as
Rights Agent, one six-hundredth of a fully paid, non-assessable
Junior Participating Preference Share (the "Preferred Stock") of
the Company, at a purchase price of $125 per one six-hundredth of a
share (the "Purchase Price"), upon presentation and surrender of
this Right Certificate with the Form of Election to Purchase and
related Certificate duly executed.  The number of Rights evidenced
by this Right Certificate (and the number of shares which may be
purchased upon exercise thereof) set forth above, and the Purchase
Price per share set forth above, are the number and Purchase Price
as of _________ __, 20__, based on the Preferred Stock as
constituted at such date.

     Upon the occurrence of a Flip-In Event (as such term is
defined in the Right Agreement), if the Rights evidenced by this
Right Certificate are beneficially owned by (i) an Acquiring Person
or an Affiliate or Associate of any such Person (as such terms are
defined in the Rights Agreement), (ii) a transferee of any such
Acquiring Person, Associate or Affiliate, or (iii) under certain
circumstances specified in the Rights Agreement, a transferee of a
person who, after such transfer, became an Acquiring Person or an
Affiliate or Associate of an Acquiring Person, such Rights shall
become null and void and no holder hereof shall have any right with
respect to such Rights from and after the occurrence of such Flip-
In Event.

     As provided in the Rights Agreement, the Purchase Price and
the number and kind of shares of Preferred Stock or other
securities which may be purchased upon the exercise of the Rights
evidenced by this Right Certificate are subject to modification and
adjustment upon the happening of certain events.

     This Right 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 Company and the holders of the Right
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 offices of the
Company and are available upon written request.

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

     Subject to the provisions of the Rights Agreement, the Rights
evidenced by this Certificate (A) may be redeemed by the Company at
its option at a redemption price of $.01 per Right at any time
prior to the earlier of the Close of business on (i) the tenth
Business Day following the Stock Acquisition Date (as such term is
defined in the Rights Agreement), as such time period may be
extended pursuant to the Rights Agreement, and (ii) the Final
Expiration Date or (B) exchanged in whole or in part for shares of
the Company's Common Stock or shares of Preferred Stock or other
property or any combination threof.  After the expiration of the
redemption period, the Company's right of redemption may be
reinstated if an Acquiring Person reduces its beneficial ownership
to 10% or less of the outstanding shares of Common Stock in a
transaction or series of transactions not involving the Company.

     No fractional shares of Preferred Stock will be issued upon
the exercise of any Right or Rights evidenced hereby (other than
fractions which are integral multiples of one six-hundredth of a
share of Preferred Stock, which may, at the election of the
Company, be evidenced by depositary receipts), but in lieu thereof
a cash payment will be made, as provided in the Rights Agreement.

     No holder of this Right Certificate shall be entitled to vote
or receive dividends or be deemed for any purpose the holder of
shares of Preferred Stock or of 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
shareowner of the Company or any right to vote for the election of
directors or upon any matter submitted to shareowners at any
meeting thereof, or to give or withhold consent to any corporate
action, or to receive notice of meetings or other actions affecting
shareowners (except as provided in the Rights Agreement), or to
receive dividends or subscription rights, or otherwise, until the
Right or Rights evidenced by this Right Certificate shall have been
exercised as provided in the Rights Agreement.

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

     WITNESS the facsimile signature of the proper officers of the
Company and its corporate seal.

Dated as of _________ __, 20__

ATTEST:                                      THE MAY DEPARTMENT STORES COMPANY

____________________                         By
Secretary                                    Name:
                                             Title:

Countersigned:

THE BANK OF NEW YORK

By______________________
   Authorized Signature

                  [Form of Reverse Side of Right Certificate]

                              FORM OF ASSIGNMENT

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

FOR VALUE RECEIVED
hereby sells, assigns and transfers unto

                  (Please print name and address of transferee)

this Right Certificate, together with all right, title and interest
therein, and does hereby irrevocably constitute and appoint
__________________ Attorney, to transfer the within Right

Certificate on the books of the within named Company, with full
power of substitution.

Dated: __________________, 20__

                                          _______________________________
                                          Signature

Signature Guaranteed:

                                  Certificate

     The undersigned hereby certifies by checking the appropriate
boxes that:

     (1)  this Right 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 pursuant to 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 Right Certificate from any Person who is, was or subsequently
became an Acquiring Person or an Affiliate or Associate of any such
Person.

Dated: ___________, 20__

                                          _______________________________
                                          Signature

Signature Guaranteed:

                                     NOTICE

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

                          FORM OF ELECTION TO PURCHASE

          (To be executed if holder desires to
          exercise Rights represented by the
          Right Certificate.)

To:  THE MAY DEPARTMENT STORES COMPANY:

     The undersigned hereby irrevocably elects to exercise
__________ Rights represented by this Right Certificate to purchase
the shares of Preferred Stock issuable upon the exercise of the
Rights (or such other securities of the Company or of any other
person which may be issuable upon the exercise of the Rights) and
requests that certificates for such shares be issued in the name of
and delivered to:

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 Right Certificate, a new Right Certificate for the balance
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:  _______________, 20__

                                          _______________________________
                                          Signature

Signature Guaranteed:

                                  Certificate

     The undersigned hereby certifies by checking the appropriate
boxes that:

      (1)  the Rights evidenced by this Right Certificate [ ] are [
] are not being exercised 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 pursuant to 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 Right Certificate from any Person who is, was or became an
Acquiring Person or an Affiliate or Associate of any such Person.

Dated: ___________, 20__

                                          _______________________________
                                          Signature

                                     NOTICE

     The signature to the foregoing Election to Purchase and
Certificate must correspond to the name as written upon the face of
this Right Certificate in every particular, without alteration or
enlargement or any change whatsoever.DESIGNATION RIGHTS AGREEMENT

Exhibit 10.1

	

DESIGNATION RIGHTS AGREEMENT

 FOR

 THE PURCHASE OF

 CERTAIN DESIGNATION RIGHTS RELATING TO REAL ESTATE AND

 LEASEHOLD INTERESTS OF CHI-CHI’S, INC.

 

by

 OS REALTY, INC.

 

Dated as of August _______, 2004

 

Table of Contents

Page

ARTICLE I CERTAIN DEFINITIONS............................................................................................ 1

ARTICLE II THE TRANSACTION................................................................................................. 5

2.1...... Purchase and Sale of Designation Rights and Properties.................................................... 5

2.2...... Designation Rights........................................................................................................... 6

2.3...... Alternate Designee; Plan.................................................................................................. 8

2.4...... Exclusion of Property....................................................................................................... 8

2.5...... Purchase Price................................................................................................................. 9

2.6...... Additional Consideration; Carrying Costs....................................................................... 11

2.7...... Expiration of Designation Rights..................................................................................... 13

2.8...... Accounting.................................................................................................................... 13

ARTICLE III THE CLOSING........................................................................................................ 13

3.1...... Time of Closing; Guaranty.............................................................................................. 13

3.2...... Time and Place of Property Closings.............................................................................. 14

3.3...... Deliveries by Seller........................................................................................................ 14

3.4...... Deliveries by Purchaser.................................................................................................. 14

3.5...... Condition of Premises.................................................................................................... 15

3.6...... Closing Costs................................................................................................................ 15

3.7...... Cure Costs.................................................................................................................... 15

ARTICLE IV INTENTIONALLY OMITTED................................................................................ 15

ARTICLE V CONDITIONS TO SELLER’S OBLIGATIONS...................................................... 15

5.1...... Representations and Warranties..................................................................................... 15

5.2...... No Injunction................................................................................................................ 15

5.3...... Designation Order......................................................................................................... 15

ARTICLE VI CONDITIONS TO PURCHASER’S OBLIGATIONS............................................ 16

6.1...... Representations and Warranties..................................................................................... 16

6.2...... Designation Order......................................................................................................... 16

6.3...... No Injunction................................................................................................................ 16

6.4...... Waiver.......................................................................................................................... 16

ARTICLE VII REPRESENTATIONS AND WARRANTIES OF SELLER................................... 17

7.1...... Due Incorporation, Etc.................................................................................................. 17

7.2...... Authorization, No Conflicts, Etc..................................................................................... 17

7.3...... Consents and Approvals................................................................................................ 17

7.4...... Leases and Real Estate.................................................................................................. 17

7.5...... Insurance....................................................................................................................... 18

7.6...... Maintenance.................................................................................................................. 18

7.7...... Survival......................................................................................................................... 18

ARTICLE VIII REPRESENTATIONS AND WARRANTIES OF PURCHASER......................... 18

8.1...... Due Incorporation, Etc.................................................................................................. 18

8.2...... Authorization, No Conflicts, Etc..................................................................................... 18

8.3...... Consents and Approvals................................................................................................ 18

8.4...... Litigation....................................................................................................................... 19

8.5...... WHERE-IS/AS-IS........................................................................................................ 19

8.6...... SURVIVAL.................................................................................................................. 19

ARTICLE IX COVENANTS PRIOR TO PROPERTY CLOSING DATE.................................... 19

9.1...... Affirmative and Negative Covenants............................................................................... 19

9.2...... Title Insurance............................................................................................................... 20

9.3...... Consents and Further Actions........................................................................................ 20

ARTICLE X ADDITIONAL COVENANTS................................................................................. 21

10.1     Further Transfers and Assurances.................................................................................. 21

10.2     Proration Items, Recording Charges and Rents............................................................... 21

10.3     Insurance....................................................................................................................... 21

10.4     Omissions...................................................................................................................... 22

10.5     Liquor Licenses............................................................................................................. 22

ARTICLE XI LEASE ASSIGNMENT........................................................................................... 22

11.1     Post-Closing Expenses.................................................................................................. 22

11.2     Seller's Obligations Regarding Assignment...................................................................... 22

11.3     Release of Designated Cure Costs With Respect To Excluded Leases............................ 23

ARTICLE XII MISCELLANEOUS............................................................................................... 23

12.1     Termination; Other Remedies......................................................................................... 23

12.2     Recordation of Agreement............................................................................................. 24

12.3     Successors and Assigns................................................................................................. 24

12.4     Default and Remedies.................................................................................................... 24

12.5     Confidentiality................................................................................................................ 24

12.6     Notices......................................................................................................................... 25

12.7     Expenses....................................................................................................................... 26

12.8     Brokerage Commissions and Fees................................................................................. 26

12.9     Casualty and Condemnation........................................................................................... 26

12.10   Entire Agreement........................................................................................................... 26

12.11   Waiver.......................................................................................................................... 26

12.12   Amendment................................................................................................................... 27

12.13   Counterparts; Facsimile Signatures................................................................................. 27

12.14   Invalid Provisions........................................................................................................... 27

12.15   Headings, Gender, Etc................................................................................................... 27

12.16   Continuing Jurisdiction................................................................................................... 27

12.17   Choice of Law............................................................................................................... 27

12.18   Obligations Joint and Several......................................................................................... 28

12.19   No Partnership or Joint Venture..................................................................................... 28

12.20   No Third Party Beneficiaries.......................................................................................... 28

12.21   Employees..................................................................................................................... 28

12.22   Cooperation.................................................................................................................. 28

12.23   Southgate, Michigan...................................................................................................... 28

12.24   Power of Attorney......................................................................................................... 28

12.25   Acceptance of Cash Purchase Price............................................................................... 29

12.26   Sale-Leaseback Properties............................................................................................ 29

12.27   Landlord Indemnification Claims.................................................................................... 32

 

 

 

 

 

 

Exhibit A                      Seller Entities

Exhibit B                      Form of Designation Order

Exhibit C                      Form of Guaranty

Schedule A                   Fee Properties; Ground Leases

Schedule A-1               Sale-Leaseback Properties

Schedule B                   Building and Land Leases

Schedule 7.4                Correspondence Related to Partial Taking of Unit 31

Schedule 11.2              Seller’s Calculation of the Pre-petition Cure Amounts Owed on Account of Each Lease

Schedule 12.26            Payments Received by Seller on Account of the Bridge Note; the Balance Due on Account of the Bridge Note; and the Maturity Date of the Bridge Note.

Schedule 12.26A          PM Note Balances Due

DESIGNATION RIGHTS AGREEMENT

THIS DESIGNATION RIGHTS AGREEMENT, dated as of August ______, 2004, between those entities listed on Exhibit A attached hereto, debtors and debtors-in-possession operating under
Chapter 11 of the Bankruptcy Code (collectively, “Seller”), and OS REALTY, INC., a Florida corporation (“Purchaser”).

RECITALS

Seller filed a voluntary petition for relief under Chapter 11 of the Bankruptcy Code (as defined below) on October 8, 2003.  Since that time Seller has remained in possession of its
property and has continued to operate its business pursuant to Sections 1107 and 1108 of the Bankruptcy Code.  Seller’s Chapter 11 cases are currently pending before the United States Bankruptcy Court for the District of Delaware (the “Bankruptcy
Court”) and have been jointly administered as Case No. 03-13063 (CGC)(the “Bankruptcy Case”).

Purchaser desires to purchase, and Seller desires to sell, the Designation Rights (as hereinafter defined) upon the terms and subject to the conditions set forth in this
Agreement.

Purchaser submitted that certain Designation Rights Agreement dated July 23, 2004 as a qualified bid in the Bankruptcy Case.  This Agreement shall supercede the July 23, 2004 Designation Rights Agreement in
all respects.

NOW, THEREFORE, in consideration of the mutual covenants and agreements set forth herein and in reliance upon the representations and warranties contained herein, the parties hereto covenant
and agree as follows:

ARTICLE I

CERTAIN DEFINITIONS

As used in this Agreement, the following terms shall have the following designated meanings:

“Affected Lease Party” has the meaning set forth in Section 2.2(c) hereof.

“Affected Real Estate Party” has the meaning set forth in Section 2.2(d) hereof.

“Agreement” means this Designation Rights Agreement, including the exhibits and the schedules attached hereto.

“Allowed Administrative Claim” has the meaning set forth in Section 2.5(b)(vii).

“Authorized Officer” of any Person means the chief executive officer, the president, any vice president or any secretary of such Person.

“Bankruptcy Case” has the meaning set forth in the recitals hereof.

“Bankruptcy Code” means Title 11 and applicable portions of Titles 18 and 28 of the United States Code, as amended from time to time.

“Bankruptcy Court” has the meaning set forth in the recitals hereof.

“Carrying Costs” has the meaning set forth in Section 2.6(a) hereof.

“Closing” has the meaning set forth in Section 3.1 hereof.

“Closing Date” means the first business day following the satisfaction or waiver (by the party entitled to waive the conditions) of all conditions to Closing set forth in
Article V and Article VI, unless otherwise agreed by the parties.

“Committee” means the official committee of unsecured creditors appointed in the Bankruptcy Case, provided that such term shall be deemed deleted from this
Agreement as of the date that the Committee is dissolved (and, to the extent the Committee’s rights under this Agreement are assigned, the term “Committee” shall be deemed to include such assignee).

“Contract Properties” has the meaning set forth in Section 2.7 hereof.

“Designated Cure Amount” has the meaning set forth in Section 11.2 hereof.

“Designation Order” means the order to be entered by the Bankruptcy Court substantially in the form of the order attached hereto as Exhibit B with such changes as
shall be satisfactory in form and substance to each of Purchaser, Seller and the Committee.

“Designation Period” has the meaning set forth in Section 2.2(a) hereof.

“Designation Rights” has the meaning set forth in Section 2.2(a) hereof.

“Designee” means any Person Purchaser identifies and designates to purchase any Real Estate or assume any Lease pursuant to Section 2.2 hereunder which shall include, without limitation, the
Purchaser, any Purchaser Affiliate, any third-party, or any other Person identified by Purchaser making a competing or alternative offer for such Real Estate or Lease.

"Election" has the meaning set forth in Section 6.2(b) hereof.

“Escrow Account” has the meaning set forth in Section 2.5(b)(i) hereof.

“Escrow Agent” has the meaning set forth in Section 2.5(b)(i) hereof.

“Escrowed Proceeds” has the meaning set forth in Section 2.5(b)(i) hereof.

“Extension Period” has the meaning set forth in Section 2.2(b) hereof.

“Final Order” shall mean an order of the Bankruptcy Court (a) which has not been reversed, vacated or stayed, and the time to file an appeal or a motion to reconsider has
expired and/or has not been extended, or (b) with respect to which any appeal has been finally decided and no further appeal or petition for certiorari can be taken or granted.

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“FFE” shall mean any furniture, fixtures and equipment owned by Seller and located at any of the Properties.

“Good Faith Deposit” has the meaning set forth in Section 2.5(a).

“Guarantor” means Outback Steakhouse, Inc., a Delaware corporation.

“Guaranty” means a written guaranty, substantially in the form of Exhibit C attached hereto, pursuant to which the Guarantor guarantees the payment to Seller of
the Purchase Price and Purchaser’s full and prompt performance of all obligations hereunder.

“Leased Premises” means the real property demised by the Leases.

“Leases” means the interest of Seller, as tenant, subtenant or otherwise, in the leases, ground leases, subleases and other instruments and agreements, together with all
amendments, modifications and supplements thereto (if any), for the Leased Premises described on Schedule A and Schedule B hereto or as described in Section 12.26(d) hereof, and all rights and interests of Seller relating thereto, whether held directly by Seller or
indirectly through an agent or nominee (including but not limited to all purchase options, renewal options, rights of first refusal and expansion rights, if any).

“Liens” has the meaning set forth in Section 7.4 hereof.

“Liquor Licenses” means the licenses granted to Seller to sell alcoholic beverages at each Property.

“Person” means any natural person, corporation, general partnership, limited partnership, limited liability partnership, limited liability company, trust, union,
association, court, agency, government, tribunal, instrumentality, or other entity or authority.

“Permitted Exceptions” means, collectively:  (a) all applicable zoning and building laws, restrictions, regulations and ordinances, provided they do not materially
impair the use of the Properties for their existing uses and purposes or materially and adversely affect the value of a Property; (b) encroachments, if any on any street or highway; (c) the state of facts that would be shown on an accurate survey or from a personal
inspection of the Properties provided such facts would not materially impair the use of the Properties for their existing uses and purposes nor materially and adversely affect the value of a Property; (d) real estate taxes, and water and sewer charges and other
similar charges which are not yet due and payable prior to the date of the Closing (subject to apportionments as provided for in this Agreement); (e) easements and rights of public utilities, which do not prevent in any material way, prohibit or materially impair or
interfere with the use of the Properties for their existing uses and purposes nor materially and adversely affect the value of a Property; (f) covenants, conditions and restrictions of record which do not prevent in any material way, prohibit or materially impair the
use of the Properties for their existing uses and purposes nor materially and adversely affect the value of a Property; and (g) monetary liens for which the provision for payment in the form of an escrow has been made to the satisfaction of a title insurer and
Purchaser.

“Plan” has the meaning set forth in Section 2.3(b) hereof.

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“Post Closing Operations Period” has the meaning set forth in Section 2.6(c) hereof.

“Proration Items” has the meaning set forth in Section 10.2(a) hereof.

“Properties” means, collectively, the properties set forth on Schedule A, Schedule A-1, and Schedule B attached hereto and made a part hereof.

“Property Closing” has the meaning set forth in Section 3.2(c) hereof.

“Property Closing Conditions” has the meaning set forth in Section 2.2(c) hereof.

“Property Closing Date” means (i) with respect to the Real Estate and Leases to which no objection has been received (or where an objection has been received and has been
consensually resolved or withdrawn or which does not prohibit or otherwise affect a Property Closing), ten (10) days following receipt of written notice from Purchaser to Seller of the identity of the Designee for the particular Property (or such other date as may be
agreed to by Seller and Purchaser), provided that no stay pending appeal or other injunction against such Property Closing is in effect, and (ii) with respect to each of the Properties to be sold to a Designee where an objection is filed and not consensually resolved
or withdrawn or which does not prohibit or otherwise affect a Property Closing, on the first (1st) business day following the date that the Sale Order approving such sale or assignment has been entered provided that the Sale Order contains protections and findings
under Section 363(m) of the Bankruptcy Code for the benefit of a Designee(s) and no stay of the Sale Order is in effect (or such other date as Seller and Purchaser may agree).

“Purchase Price” has the meaning set forth in Section 2.5(a) hereof.

“Purchase Price Reduction” means, with respect to any particular Real Estate or any particular Lease, the amount of the Purchase Price to be allocated to such Real Estate
or such Lease as agreed upon by Seller, the Committee and Purchaser for the Properties.  If no mutual agreement is reached, then the Purchase Price Reduction shall mean the amount of the reduction to the Purchase Price as determined by the Bankruptcy
Court.

“Purchaser Affiliate” means a Person controlling, controlled by, under common control or is affiliated with Purchaser; “control,” as so used, shall mean the
ability to control the voting rights or management rights of such Person.

“REA” means any applicable Lease, reciprocal easement, operating or similar agreements relating to the Properties.

“Real Estate” has the meaning set forth in Section 2.1(b) hereof or as described in Section 12.26(c) hereof.

“Sale-Leaseback Properties” are the Properties set forth on Schedule A-1 hereto together with any and all leases, mortgages, agreements, and promissory notes related
thereto as described in Section 12.26 hereof.

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“Sale Order” means an order or orders of the Bankruptcy Court which may be entered from time to time approving the sale of any Real Estate, or the assumption and assignment of a Lease,
to a Designee, if required after an appropriate objection is filed, and containing terms mutually satisfactory to Purchaser and Seller.

Rules of Construction.  For purposes of this Agreement:  (a) whenever from the context it is appropriate, each term, whether stated in the singular or the plural, shall include both the singular and the
plural; (b) any reference in this Agreement to a contract, instrument, release, or other agreement or document being in a particular form or on particular terms and conditions means that such contract, instrument, release, or other agreement or document shall be
substantially in such form or substantially on such terms and conditions; (c) any reference in this Agreement to an existing document or Exhibit means such document or Exhibit as it may have been or may be amended, modified or supplemented; (d) if this
Agreement’s description of the terms of an Exhibit is inconsistent with the terms of the Exhibit, the terms of the Exhibit shall control; (e) unless otherwise specified, all references in this Agreement to Sections and Exhibits are references to Sections and
Exhibits of or to this Agreement; (f) unless the context requires otherwise, the words "herein," "hereunder" and "hereto" refer to this Agreement in its entirety rather than to a particular Section or subsection of this Agreement; (g) any phrase containing the term
"include" or "including" shall mean including without limitation; and (h) all of the Exhibits referred to in this Agreement shall be deemed incorporated herein by such reference and made a part hereof for all purposes.

ARTICLE II

THE TRANSACTION

2.1       Purchase and Sale of Designation Rights and Properties.

            (a)        On the terms and subject to the conditions contained in this
Agreement and the Designation Order, on the Closing Date, Purchaser shall purchase from Seller, and Seller shall sell, convey, assign, transfer and deliver to Purchaser, pursuant to Sections 105, 363, and 365 of the Bankruptcy Code, the Designation Rights for all of
the Properties, FFE, and Liquor Licenses free and clear of all Liens of any kind whatsoever to the fullest extent permissible pursuant to the Bankruptcy Code, but subject to Permitted Exceptions.

            (b)        During the Designation Period, and on the terms and subject to the conditions contained in this Agreement and the
Designation Order, on each Property Closing Date for each Property Closing, Seller shall sell, convey, assign, transfer and deliver to a Designee, free and clear of all Liens, other than Permitted Exceptions, all of Seller’s right, title and interest in, to and
under the applicable real property owned by Seller, including the land, building improvements thereon, all plumbing, electrical, mechanical, heating and air conditioning equipment and systems owned by Seller that are permanently attached to the real estate, and all
easements, licenses, rights-of-way, permits and other appurtenances thereto and all renewal options, purchase options, rights of first refusal and expansion rights relating thereto, if any (including Seller’s rights in and to public streets, whether or not
vacated and existing third-party warranties relating thereto, if any, and to the extent assignable), whether held by Seller directly or through a nominee (collectively, the "Real Estate").  In addition, during the Designation Period, upon the direction of
Purchaser,

5

  Seller shall sell, assign and convey to a Designee, its rights under the Leases, including any ground leases (and conveying all improvements located on the properties which are ground leased).  As part of the sale
or conveyance of the Properties to a Designee, Purchaser shall have the right to sell the FFE and the Liquor Licenses to such Designee or otherwise.  Purchaser shall have the right to sell, assign, or otherwise transfer Seller’s right,
title, and interest in the following three items separately from each other with regard to its rights to designate, or exclude: (1) Properties and/or Leases, (2) FFE, and (3) Liquor Licenses; provided, however, that Purchaser shall not exclude or designate these
items in a manner that would leave the Seller with only the FFE with respect to any Property or Lease. 

            (c)        Seller has no rights, monetary or otherwise, respecting the future sales or dispositions
of the Properties, including any proceeds derived from the Properties, all of which shall be retained by Purchaser for its own account; except with respect to Properties excluded by Purchaser pursuant to Section 2.4 below, Leases which revert to Seller pursuant to
Section 2.7 below, and the Southgate, Michigan property if excluded by Seller pursuant to Section 12.23 below, but subject to Purchaser’s right to retain the FFE and/or the Liquor Licenses under Section 2.1(b) above.

2.2       Designation Rights.

            (a)        During the Designation Period, Purchaser
shall have the sole, exclusive, and continuing right to select, identify and designate (on one or more occasions):  (i) which Real Estate shall be conveyed, and to whom, (ii) which Leases shall be assumed and assigned (including to a landlord a Lease which may
involve terminating a Lease in lieu of assigning a Lease to a landlord), and to whom, and (iii) which Properties shall be excluded from the transaction (all of which rights are referred to herein as the “Designation Rights”). 
Purchaser’s Designation Rights for the Real Estate and the Sale-Leaseback Properties shall expire (unless extended by further order of the Bankruptcy Court) on the date which is one year after the Closing Date and for the Leased Premises on the expiration of
the Extension Period for the Leases (such time period applicable to each Property, being the “Designation Period”).  The Designation Rights conveyed to Purchaser hereunder shall include, among other things, the exclusive power to designate to
a Designee (and to have Seller convey to such Designee) all rights, title, interests, options, contract rights and appurtenances of Seller in and to the following:  (x) the Properties, (y) the FFE, and (z) the Liquor Licenses.

            (b)        With respect to the assignment and
assumption of the Leases, Seller has obtained an order of the Bankruptcy Court approving the extension of time to assume or reject the Leases for a period of up to the later of (i) nine (9) months after the Designation Order has been entered with the Bankruptcy Court
or (ii) ninety (90) days after the Seller has ceased operating on the Properties (the “Extension Period”). 

            (c)        Within five (5) business days of receipt of
written notice from Purchaser to Seller as to a proposed assumption and assignment of a Lease to a Designee, Seller shall, consistent with Section 12.27 below, deliver a written notice to the parties set forth in Section 12.27 including, without limitation, the
landlord for such Lease stating the identity of the Designee.  Simultaneously, Purchaser shall also provide documentation from the Designee to be delivered

 

6

to the landlord relating to “adequate assurance of future performance” by the Designee as required by Section 365 of the Bankruptcy Code.  The Designation Order shall provide that the landlord
(the “Affected Lease Party”) shall have ten (10) days after the delivery of Seller’s written notice hereunder to file with the Bankruptcy Court an objection to the proposed assignment of the Lease to a Designee.  If a timely and
appropriate written objection is made, the Bankruptcy Court will hold a hearing and rule on the objection.  Seller and Purchaser shall use commercially reasonable efforts to have such objection overruled, provided, however, that, except as otherwise provided in
Section 12.26, the costs and expenses of responding to any objection as to adequate assurance of future performance, and any appeal thereof and of litigating and/or settling any such objection shall constitute a Carrying Cost.  Any and all costs and expenses
related to any litigation involving the cure amounts owed to landlords for any and all periods prior to the Closing Date shall be paid by Seller.  If the objection is overruled or withdrawn, the Property Closing shall occur on the Property Closing Date.  If
the objection is upheld by the Bankruptcy Court, Purchaser shall retain the Designation Rights to such Property and the Purchase Price shall not be reduced (unless the failure to obtain an order overruling the objection was due to (i) a condition set forth in Section
6.2 of this Agreement not having been satisfied, (ii) any of representations of Seller contained in Section 7.4 and Section 12.26 of this Agreement as to the applicable Property not being then currently true and correct, (iii) Seller failing to take any material
action required to be taken by Seller pursuant to this Agreement, in order to consummate the applicable Property Closing with respect to such Property, or (iv) Seller having taken any action which would prevent the applicable Property Closing from occurring in
accordance with this Agreement (collectively, the “Property Closing Conditions”) and not due to any failure on the part of Purchaser, including the inability of a Designee to satisfy “adequate assurance” requirements of Section 365 of
the Bankruptcy Code).  The Designation Order shall further provide that if no objection to the assumption and assignment is timely made, or such objection involves a “cure amount” or "cure issue” which, pursuant to the Designation Order, will
not adversely affect the assignment of the Lease, the assumption and assignment shall be deemed effective and binding (without further Bankruptcy Court order) and the Affected Lease Party shall be deemed to have consented to the assumption and assignment and to have
waived all objections (other than a landlord’s cure amounts) and Seller shall hold a closing for the assignment of the Lease to the Designee within fifteen (15) days after receipt of the above-noted designation notice from Purchaser to Seller.

            (d)        Within five (5) days after receipt of
written notice from Purchaser to Seller as to a proposed sale of Real Estate to Purchaser or a Designee, Seller shall deliver a written notice to the non-Seller party to the REA (the “Affected Real Estate Party”), if any, setting forth the identity
of the Designee who will acquire the Real Estate.  The Designation Order shall provide that such Affected Real Estate Party shall have ten (10) days to file with the Bankruptcy Court an objection to the proposed sale.  If a timely written objection is made,
the Bankruptcy Court shall hold a hearing and rule on the objection.  Seller and Purchaser shall use commercially reasonable efforts to have such objection overruled, provided, however, that the costs and expenses of responding to any objection,
and any appeal thereof and of litigating and/or settling any objections shall constitute a Carrying Cost.  If the objection is overruled or withdrawn, the Property Closing shall occur on the Property Closing Date.  If the objection is upheld by the
Bankruptcy Court, Purchaser shall retain the Designation Rights to such Property and the Purchase Price shall not be reduced (unless the failure to obtain such order was due to a failure

7

  by Seller to satisfy a Property Closing Condition).  If no objection is timely made, the Affected Real Estate Party shall be deemed to have consented to the sale, and Seller shall hold a closing of
the conveyance of the Real Estate to the Designee within fifteen (15) days after receipt of the above-noted designation notice from Purchaser to Seller or at such later time agreed upon by Purchaser and Designee.

            (e)        The Designation Order shall establish
procedures for expedited discovery relating to any objections to the proposed designations of sales or assignments by Purchaser to its Designees.  Each of Seller, Purchaser and the applicable Designee shall use their best efforts to comply and shall fully
cooperate with each other in the resolution of any objections to the proposed sale or the proposed assumption and assignment.

            (f)         After the Closing, Purchaser shall have the right, in its sole discretion, to direct
Seller to hold one or more auctions for any of the Properties, the FFE, and/or the Liquor Licenses and to direct Seller to obtain one or more orders of the Bankruptcy Court approving any subsequent transfer or assignment of a Property, the FFE, and/or the Liquor
Licenses to a Designee, provided, however, that all costs and expenses of such auctions and for reviewing, responding, litigating and settling any objections or responses which may be received in response to Purchaser's request for approval of the Sale Orders shall
be deemed to be a Carrying Cost. 

2.3       Alternate Designee; Plan.

            (a)        To the extent any Designee fails to close on any Real
Estate,Purchaser shall have the right to direct Seller to convey such Real Estate directly to an alternate Designee and Purchaser shall retain all of its respective Designation Rights under this Agreement.

            (b)        Nothing herein shall preclude Seller from
filing a plan of reorganization or of liquidation (collectively, the “Plan”) during the Designation Period for the Properties, the FFE, and the Liquor Licenses; provided that the Plan shall (i) contain provisions for the disposition of the
Properties, the FFE and the Liquor Licenses, which shall be consistent with (and shall not reduce, limit or otherwise affect in any way) Purchaser’s Designation Rights and Purchaser’s rights in this transaction and with the terms of this Agreement,
including but not limited to, Purchaser’s rights, if required hereunder, to seek a subsequent Sale Order for the benefit of any Designee; (ii) not be confirmed prior to the expiration of Purchaser’s Designation Rights hereunder as set forth in Section 2.7
below; and (iii) shall provide for the Purchaser’s filing on or before the confirmation hearing to consider such Plan of an estimated Allowed Administrative Claim as more fully set forth in Section 2.5(b)(vii).

2.4       Exclusion of Property.  Purchaser shall have the right to exclude any Property, FFE or Liquor License from this transaction at any time (including the right to exclude any
Property, any FFE, and any Liquor License previously designated by Purchaser to be assigned or sold, as the case may be, to a Designee in the event a Property Closing Condition does not occur).  The Purchase Price shall not be reduced by such exclusion of any of
the Properties unless such exclusion was a result of, or based upon, Seller’s failure to satisfy a Property Closing Condition or any action of Seller which caused any of the Property Closing Conditions not to be satisfied, in which case the Purchase Price shall
be reduced by the Purchase Price Reduction.  Purchaser

 

8

shall recover any Purchase Price Reduction pursuant to Section 2.5(b).  Purchaser shall have the right to exclude any of the Properties from this transaction with no reduction in the Purchase Price and Purchaser’s
obligation to pay Carrying Costs for any such excluded Properties shall terminate on the date which is ten (10) days after Purchaser notifies Seller and the Committee that it is excluding any such Property from this transaction, provided, however, that the Bankruptcy Court permits Seller to reject leases upon ten (10) day notice and Seller shall use commercially reasonable efforts to cause the Bankruptcy Court to approve such ten (10) day rejection notice period.  In the event the Bankruptcy Court
rules that Seller must provide for a period in excess of ten (10) days to reject leases, Purchaser will provide such additional notice period to exclude any Leases hereunder.   In the event Purchaser exercises its option to retain FFE at any excluded
Property it will remove such FFE on or before the delivery of notice to Seller and the Committee as provided above.  Purchaser hereby agrees to exclude or designate at least 50% of the Properties listed on Schedule B attached hereto on or prior to
September 15, 2004 unless Seller and Purchaser mutually agree to extend such date.  Additionally, Purchaser hereby agrees to use its best efforts to expedite the exclusion or designation of any Lease with a renewal or option exercisable between the Closing Date
and the  Extension Period; provided, however, that the failure to exclude or designate any such Lease shall not constitute a breach hereunder by Purchaser.  Purchaser’s Carrying Cost obligations relating to an excluded Property shall terminate in
accordance with the procedure set forth under Section 2.6.  In addition, within ten (10) days after Purchaser excludes any Properties hereunder, Escrow Agent shall disburse to Purchaser out of the Escrowed Proceeds a sum equal to the pro-rata amount (computed
with the methodology described in Section 10.2 below) of any Carrying Cost paid by Purchaser in accordance with Section 2.6 below with respect to such excluded properties attributable to any periods subsequent to the date of exclusion of such Property
hereunder.  At the time a Property is excluded as provided herein, (i) Purchaser shall retain the right to exercise the option to designate or exclude the FFE and/or Liquor Licenses associated with such excluded Property in accordance with Section 2.1(b) above
(provided, however, that the designation or exclusion shall occur during the Designation Period), and (ii) all rights to market, sell, abandon in accordance with Section 554 of the Bankruptcy Code, assume, assign or
reject such Property, except for the FFE and/or Liquor Licenses Purchaser elects to designate under Section 2.1(b) above (and all obligations relating thereto) shall terminate, and such rights shall revert to Seller.  Except for the FFE and/or Liquor Licenses
Purchaser elects to retain under Section 2.1(b) above, after a Property has been excluded, Seller shall be entitled to retain all proceeds received from the disposition of such Properties.

2.5       Purchase Price. 

            (a)        The Purchase Price shall be $42,500,000, payable in cash on the Closing Date adjusted by
the Proration Items, and paid in part by application of the cash deposit previously delivered by Purchaser to Seller in the amount of $2.5 million (the “Good Faith Deposit”). 

            (b)        Escrowed Proceeds and Allowed Administrative Claim.

                        (i)         Seller shall escrow the sum of
$8,000,000 out of the Purchase Price paid at Closing (the “Escrowed Proceeds”) with Wilmington Trust Company, or such other entity mutually acceptable to Seller and Purchaser (the “Escrow Agent”). Upon receipt of

9

  the Escrowed Proceeds, the Escrow Agent shall deposit the Escrowed Proceeds into a non-IOTA interest-bearing account (the "Escrow Account") which shall be opened and maintained by the Escrow Agent in accordance
with the terms of this Agree­ment, and the Escrow Agent shall be the only party authori­zed to make disbursements therefrom.  The Escrow Account shall be invested by the Escrow Agent in money market funds or other similarly liquid investments and shall
not be commingled with other assets owned or held by the Escrow Agent.  The Escrow Agent shall forward copies of the monthly bank statements for the Escrow Account to the Seller and Purchaser when received by the Escrow Agent.

                        (ii)        Escrow Agent shall disburse the Escrowed
Proceeds to Purchaser for the following items: (A) reimbursement of any pro-rated Carrying Costs paid on any Properties excluded by Purchaser pursuant to Section 2.4 above; (B) reimbursement of any Proration Items; (C) any Purchase Price Reductions; (D) as further
provided in Section 12.27(a) below, reimbursement for any landlord indemnification claims paid by Purchaser; provided, however, that Escrow Agent shall not disburse more than $500,000 in the aggregate of the Escrowed Proceeds to Purchaser for landlord indemnification
claims described in Section 12.27(a) and Purchaser hereby agrees and acknowledges that its’ sole and exclusive remedy with respect to any and all landlord indemnification claims under Section 12.27(a) below shall be reimbursement from the Escrowed Proceeds in
an aggregate amount not to exceed $500,000; (E) reimbursement for any and all claims or settlements paid by Purchaser including all attorneys fees and costs, for any occurrence prior to the Property Closing Date including, without limitation, any occurrence with
respect to or in any way related to Seller’s operations during the Post Closing Operations Period; and (F) reimbursement for the payment of any and all pre-Closing Date cure costs on any lease to be assumed and assigned to any Designee hereunder in the event
Purchaser exercises its option under Section 11.2 to pay such claims and reimbursement for the payments made by Purchaser as expressly provided in Section 12.27(c) below.

                        (iii)       The Escrow Agent shall disperse Escrowed
Proceeds with respect to cure costs in accordance with Sections 11.2 and 11.3 hereof. 

                        (iv)       The Escrow Agent shall disburse Escrowed
Proceeds to the Seller in the following amounts and under the following circumstances:

                                    (A)      
Leases:  Upon the occurrence of each Property Closing Date with respect to the Leases, the Escrow Agent shall release to the Seller Escrowed Proceeds in the amount of $22,350

                                      (B)     
Sale-Leaseback Properties:  Upon the occurrence of each Property Closing Date with respect to the Sale-Leaseback Properties, the Escrow Agent shall release to the Seller Escrowed Proceeds in the amount of $56,667.

                                    (C)       Real
Estate:  Upon the occurrence of each Property Closing Date with respect to a Property that is not a Lease or a Sale-Leaseback Property, the Escrow Agent shall release to the Seller Escrowed Proceeds in the amount of $50,000.  Upon the occurrence of the
Property Closing Date for the last remaining Property described herein, the Escrow Agent shall release to the Seller Escrowed Proceeds in the amount of $1,420,000.

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                        (v)        The Escrow Agent shall disburse any
Escrowed Proceeds on deposit, including any and all interest accrued thereon in the Escrow Account as of August 30, 2005 to Seller.

                        (vi)       In addition to the disbursements specifically
authorized herein, the Escrow Agent shall disburse the Escrowed Proceeds in accordance with any joint written instruction from Seller and Purchaser. 

                        (vii)      Except as otherwise provided in (b)(ii)(D) herein
with respect to landlord indemnification claims as set forth in Section 12.27(a), to the extent that Escrowed Proceeds are not sufficient to reimburse Purchaser for the items set forth in (b)(ii) herein, Purchaser shall be granted pursuant to the terms of the
Designation Order an allowed claim under Section 364 of the Bankruptcy Code having administrative priority and senior status over any and all other costs and administrative expenses, including, without limitation, the kind specified in Sections 105, 326, 330, 331,
503(b), 506, 507(a), 507(b) and 726 of the Bankruptcy Code (an “Allowed Administrative Claim”).   To the extent that Seller seeks to confirm a Plan prior to a final determination of the amount of Purchaser’s Allowed Administrative
Claim, Purchaser shall file an estimated Allowed Administrative Claim, if any,  in accordance with Section 2.3(b).  Purchaser’s ability to recover on account of its Allowed Administrative Claim shall not be adversely affected by Section 365(k) of the
Bankruptcy Code and Seller hereby waives its rights thereunder. 

2.6       AdditionalConsideration; Carrying Costs.

            (a)        Subject to Sections 2.6(c), 12.23, 12.26 and 12.27 hereof,
Purchaser shall be responsiblefor, and shall pay in accordance with Section 2.6(b) below, all post-Closing Date obligations that are directly attributed to the Properties and payable to third parties, which obligations, or the pro
rata portion thereof, shall include rent, ground lease rent, common area maintenance, utilities, real estate taxes, insurance, security, other actual out-of-pocket costs under any Lease or REA or otherwise directly attributed to the Properties and payable to
third parties or as otherwise agreed between Seller and Purchaser, and any costs or expenses related to the marketing or sale of the Properties including, without limitation, any broker’s commissions or charges payable to any party which is not affiliated with
Purchaser, as well as all appraisal costs associated with the Sale-Leaseback Properties, (collectively, the “Carrying Costs”) which are incurred for each of the Properties for the period commencing on the Closing Date.  Purchaser’s
obligation for Carrying Costs of the Properties shall terminate on the earliest to occur of (a) the expiration of the Extension Period (or any extension thereof) with respect to Leases, (b) the rejection date of a Lease, (c) subject to the terms and provisions
regarding the timing of the notice described in Section 2.4 hereof, ten (10) days after the giving of written notice by Purchaser to Seller and the Committee that Purchaser excludes any further interest in a Property, (d) the occurrence of a Property Closing relating
to the transfer of a Property to a Designee, and (e) one (1) year after

 

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the Closing Datefor any Real Estate.  During the period that Purchaser is paying Carrying Costs, Purchaser shall be entitled to receive and retain all lease rentals, all sublease rentals, and all
other income generated from the Properties for any of the Properties until such Properties are sold, assigned or excluded, provided that such sums received shall be accounted for by Purchaser and shall constitute an offset against Carrying Costs.  Nothing
herein shall constitute an assignment or sale of any claims or rights of Seller under any agreement relating to the Properties including, without limitation, rent credits, security deposits, refunds or other rebates.  Purchaser’s Carrying Costs shall not
include (i) any late fees, penalties, interest or other late charges or fees incurred other than as a result of Purchaser’s failure to perform under Section 2.6(b) below; or (ii) debt service (i.e., payments on account of loan principal, interest, fees
or penalties) on any indebtedness secured by any of the Properties or any tax obligations with respect to a time period prior to the Closing Date (regardless of when the bill for payment may be received for such taxes); provided, however, notwithstanding anything
contained herein to the contrary, except as otherwise provided in Section 12.26, all payments made in connection with the Sale-Leaseback Properties shall be Carrying Cost obligations.

            (b)        On or about ten (10) days prior to the end
of each month, Seller shall advise Purchaser in writing of the aggregate amount of the Carrying Costs (broken down by category and containing information in sufficiently reasonable detail) that will be due and owing for the Properties in the following month. 
Subject to 2.6(c) below, Purchaser shall pay via wire transfer the Carrying Costs to Seller, in each case, within five (5) days after notification from the respective parties and, except as otherwise expressly provided herein, without offset or deduction of any kind
and notwithstanding any objection that Purchaser may interpose to such amounts; provided that Purchaser may object to the Carrying Costs within ten (10) days after such notification.  If Purchaser makes a timely objection, the parties shall first attempt
to resolve the dispute consensually and, absent resolution, such dispute shall be submitted to the Bankruptcy Court; provided however, that in the event Purchaser objects to any such amount and fails to pay said amount to Seller, and as a result, Seller fails to pay
the Carrying Cost in question, any and all risk of loss associated with said Carrying Cost, including a default under a Lease shall be borne exclusively by Purchaser and Purchaser shall not have any recourse whatsoever against Seller, including the right to any
Purchase Price Reduction as a result thereof.  Seller shall deposit any and all funds received from Purchaser hereunder in a separate trust account established by Seller for the sole purpose of paying Carrying Costs hereunder.  Seller shall not commingle
any funds with the funds delivered by Purchaser and shall provide Purchaser with copies of all bank statements and check runs on a monthly basis within ten (10) days of Seller’s receipt thereof.  Purchaser shall have the right to inspect, review and audit
the trust account and any deposits and disbursements therefrom.  Seller shall have the right to provide estimates of the Carrying Costs if Seller does not know the actual amounts ten (10) days prior to the end of each month and in such event Purchaser and Seller
hereby agree to reconcile such amounts and reimburse each other, as the case may be, upon receipt of evidence of the actual Carrying Costs.  Seller shall timely pay any and all Carrying Costs out of the funds delivered by Purchaser hereunder.  To the extent
Seller fails to timely pay any of the Carrying Costs, Seller shall be responsible for payment of any and all fees, late charges, penalties or additional amounts payable as a result of such failure to timely pay.  Subsequent to the Closing Date, Seller and
Purchaser may modify the procedures related to the payment of Carrying Costs in the event an agreement is reached regarding Seller’s continued operations at one or more of the Properties.  Notwithstanding anything contained

 

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herein to the contrary, Purchaser shall pay to Seller on the Closing Date an amount equal to the sum (a) Seller’s anticipated Lease obligations for the 30-day period following the Closing Date and (b)
Seller’s estimate (to be provided by Seller) of Purchaser’s share of the Proration Items.

            (c)        Seller shall terminate its business operations at the Properties as
soon as reasonably practical but in all events no later than September 30, 2004.  Seller shall be solely responsible for the termination of business operations and Seller shall be solely responsible for any and all costs, claims, and losses incurred and shall be
the beneficiary of any profit from business operations for any Property during the period Seller operates such Property following the Closing Date (such period the “Post Closing Operations Period”).  Carrying Costs attributable to the Post
Closing Operations Period for any Property at which Seller conducts business operations shall be paid by Seller and not by Purchaser. Immediately following the termination of business operations at each Property, Purchaser shall be solely responsible for all Carrying
Costs associated with said Property.

2.7       Expiration of Designation Rights.  Purchaser shall designate one or more Designees, including Purchaser or any Purchaser Affiliate as an alternative Designee, to purchase the
Real Estate and the Sale-Leaseback Properties on or before one (1) year after the Closing Date and shall designate one or more Designees, including Purchaser or any Purchaser Affiliate as
an alternative Designee, to receive assignments of Leases on or before the expiration of the Extension Period and within the time periods set forth in Section 2.4.  Any and all proceeds received from contracts of sale executed prior to the end of the Extension
Period for the Leased Premises and one (1) year from the date hereof for the Real Estate and the Sale-Leaseback Properties but which close no later than ninety (90) days thereafter (the “Contract Properties”) shall be paid to Purchaser, provided
that Purchaser pays the Carrying Costs on those Properties until they are sold or assigned to a Designee.  Unless the Designation Period has been extended as set forth in Section 2.2 above, upon expiration of the Designation Period the
rights to the Leases and the FFE related to such Leases shall revert to the Seller, the remaining Real Estate and the FFE related to such Real Estate shall be conveyed to Purchaser, the rights to the Liquor Licenses, to the extent allowed pursuant to applicable law
or as set forth in the relevant documents, shall be conveyed to Purchaser and any and all of Seller’s right, title and interest in and to the remaining Sale–Leaseback Properties and the FFE related to such Sale-Leaseback Properties shall be conveyed to
Purchaser.

2.8       Accounting.  Upon reasonable notice, at request of Purchaser, Seller will supply an accounting of the Carrying Costs.  In addition, within twenty-one
(21) days of the end of each month during the Designation Period, Seller will supply Purchaser with an accounting of the actual and accrued Carrying Cost for the prior month.

ARTICLE III

THE CLOSING

3.1       Time of Closing; Guaranty.  The consummation of the sale and transfer of the Designation Rights provided for in this Agreement (the “Closing”) shall occur on
the Closing Date, subject to satisfaction of all the conditions to Closing set forth in Article V, Article VI and

 

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elsewhere in this Agreement.  At Closing, Purchaser shall cause to be delivered to Seller the Guaranty duly executed by the Guarantor.

3.2       Time and Place of Property Closings.  The consummation of the sale of each Property (each a “Property Closing”) shall be subject to satisfaction of all the
Property Closing Conditions for such Property.  Each Property Closing shall occur at the office of Seller’s counsel or such other location as Seller and Purchaser shall agree.

3.3       Deliveries by Seller.  At each Property Closing, Seller shall deliver to Purchaser or its Designees the following:

            (a)        with respect to the Real Estate, the
Designation Order, deeds equivalent to such deeds customarily given by debtors in bankruptcy (“Deeds”), bill of sale, assignment of leases affecting the Real Estate, assignment of rents and security deposits, if applicable, FIRPTA affidavit, any
applicable local and state transfer tax forms, assignment of operating agreements, if any, and to the extent in Seller’s possession, original counterparts or copies of all the leases affecting the Real Estate, bills and fuel reading if required for
apportionments, all written guarantees and warranties in force which Seller has in its possession, together with an assignment of such guaranties and warranties.

            (b)        with respect to the Leases, an assumption
and assignment agreement for each of the Leases, together with any applicable local or state transfer tax forms;

            (c)        all other documents (including assignments
of operating agreements affecting the Real Estate or the Leased Premises and closing statements), affidavits, instruments and writings reasonably required to be executed by Seller at or prior to the Property Closing Date pursuant to this Agreement or otherwise
required by law, or reasonably requested by Purchaser or the title insurer in connection herewith, each in form and substance reasonably satisfactory to Purchaser and Seller; and

            (d)        appropriate documentation to effect a
transfer or sale and conveyance of the FFE and/or Liquor Licenses;

3.4       Deliveries by Purchaser.  At each Property Closing, Purchaser or Designee shall deliver:

            (a)        the purchase price with respect to the
Property, which shall be paid directly to Purchaser and Seller shall have no right, claim or interest thereto;

            (b)        counterparts of the instruments referred to
in Section 3.3 which are to be executed by the Designee; and

            (c)        all other documents (including assumptions
of the operating agreements affecting the Real Estate or the Leased Premises and closing statements), instruments and writings reasonably required to be delivered by Purchaser or its Designees at or prior to the Property Closing Date pursuant to this Agreement or
otherwise required, or reasonably requested by Seller, in connection herewith, each in form and substance reasonably satisfactory to each of Purchaser and Seller.

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3.5       Condition of Premises.  The Properties shall be delivered to the Designee on the Property Closing Date in broom-clean condition and if a Property is not delivered in broom-clean
condition, Purchaser may request that Seller bring such Property to a broom-clean condition and if Seller so refuses, then Purchaser shall have the right to hire agents to clean and remove personal property and any debris and trash from such premises, and such
reasonable and documented expenses for such removal shall be deducted as an offset to the following month’s Carrying Costs payable by Purchaser pursuant to Section 2.6(b) above.

3.6       Closing Costs.  Purchaser shall prepare the bills of sale, assignments and Deeds in connection with each Property Closing.  In connection with each Property Closing, the
Designee, shall pay for title insurance premiums, survey costs, and examination fees of the Real Estate and Leases, if required by the Designee, and other instruments for the due transfer of the Real Estate and assignment of the Leases.  Other costs associated
with the Property Closing and transactions contemplated under the Agreement shall be allocated as provided elsewhere in the Agreement.

3.7       Cure Costs.  Seller shall have sole responsibility for all costs of curing monetary defaults arising prior to the Closing Date under the Leases pursuant to Section 365 of the Bankruptcy Code in
accordance with the procedures in Article XI hereof.

ARTICLE IV

INTENTIONALLY OMITTED

ARTICLE V

CONDITIONS TO SELLER’S OBLIGATIONS

Seller’s obligations to consummate the transactions contemplated by this Agreement are subject to the satisfaction at or prior to the Closing Date of the following conditions:

5.1       Representations and Warranties.  All representations and warranties of Purchaser contained in this Agreement shall be true and correct in all material respects at and as of the
Closing Date, as if such representations and warranties were made at and as of the Closing Date and Purchaser shall have performed all agreements and covenants required by this Agreement to be performed by it prior to or at the Closing Date in all material
respects.  On the Closing Date, there shall be delivered to Seller a certificate (dated as of such date and signed by an Authorized Officer of Purchaser) as to the matters set forth in this Section 5.1.

5.2       No Injunction.  No injunction, stay or restraining order shall be in effect prohibiting the consummation of the transactions contemplated by this Agreement.

5.3       Designation Order.  The Bankruptcy Court shall have entered the Designation Order.

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ARTICLE VI

CONDITIONS TO PURCHASER’S OBLIGATIONS

Purchaser’s obligation to consummate the transactions contemplated by this Agreement is subject, in the discretion of Purchaser, to the satisfaction at or prior to the Closing Date of
each of the following conditions:

6.1       Representations and Warranties.  All representations and warranties of Seller contained in this Agreement shall be true and correct in all material respects at and as of the
Closing Date as if such representations and warranties were made at and as of the Closing Date and Seller shall have performed all agreements and covenants required by this Agreement to be performed by it prior to or at such date in all material respects.

6.2       Designation Order.

            (a)        Ten days shall have passed after the entry
of the Designation Order and such Order shall not be subject to a stay.

            (b)        Seller shall use commercially reasonable efforts to obtain the
Designation Order.  If the Designation Order does not become a Final Order as a result of appeals or motions which have been filed challenging the Designation Order as a result of which the Designation Order is subject to a stay, then Purchaser shall have thirty
(30) days from the date the Designation Order is stayed to notify Seller and the Committee in writing that Purchaser elects, in its reasonable discretion, to terminate this Agreement.  The Purchaser's right to make the election to terminate this Agreement as set
forth in this Section is referred to herein as the "Election."  If Purchaser fails to make a timely Election, Purchaser shall be deemed to have waived its rights to terminate this Agreement as a result of the form and substance of the Designation Order
and/or, to the extent applicable, to the failure of the Designation Order to become a Final Order.   

6.3       No Injunction.  No injunction, stay or restraining order shall be in effect prohibiting the consummation of the transactions contemplated by this Agreement on the Closing
Date.

6.4       Waiver.  Each of the preceding conditions shall be satisfied in all material respects or may be waived by Purchaser, but only if such waiver is set forth in a writing executed by
Purchaser or Purchaser closes the transaction with respect to the purchase of the Designation Rights.  Without limiting any of Purchaser’s other rights and remedies under this Agreement, if any of the preceding conditions shall not be satisfied and are not
waived by Purchaser, so long as Purchaser is not in default hereunder, Purchaser may if such condition affects all (or substantially all) of the Properties, terminate this Agreement and neither party shall have any further liabilityto the other.

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ARTICLE VII

REPRESENTATIONS AND WARRANTIES OF SELLER

Seller hereby represents and warrants to Purchaser as follows:

7.1       Due Incorporation, Etc.  Subject to any required approval of the Bankruptcy Court, Seller has the corporate power and authority and all necessary governmental approvals to enter
into the transactions covered by this Agreement.  To the Seller’s knowledge, each Seller is duly qualified as a foreign corporation to do business in each jurisdiction where the Real Estate is owned and the Leased Premises leased by such Seller are
located, except where the failure to be so qualified would not individually or in the aggregate have a material adverse effect on the transactions contemplated by this Agreement.

7.2       Authorization, No Conflicts, Etc.  Subject to the entry and effectiveness of the Designation Order, this Agreement has been duly and validly executed and delivered by Seller and
(assuming this Agreement constitutes a valid and binding obligation of Purchaser and upon receipt of any required approval of the Bankruptcy Court) constitutes a valid and binding agreement of Seller, enforceable against Seller in accordance with its terms, subject
to applicable bankruptcy, reorganization, insolvency, moratorium and other laws affecting creditor’s rights generally from time to time in effect and to general equitable principles.  To Seller’s knowledge, subject to any required approval of the
Bankruptcy Court, neither the execution and delivery of this Agreement and all documents contemplated hereunder to be executed by Seller, nor the performance of the obligations of Seller hereunder or thereunder will result in the violation of any law or any provision
of the organizational documents of Seller or will conflict with any order or decree of any court or governmental instrumentality of any nature by which Seller is bound.

7.3       Consents and Approvals.  To Seller’s knowledge, no consent, approval or authorization of, or declaration, filing, or registration with, any United States federal or state
governmental or regulatory authority is required to be made or obtained by Seller in connection with the execution, delivery and performance of this Agreement and the consummation of the transactions contemplated hereby, except (a) for consents, approvals, or
authorizations of, or declarations or filings with, the Bankruptcy Court, and (b) for consents, approvals, authorizations, declarations, filings or registrations, which, if not obtained, would not, individually or in the aggregate, have a material adverse effect on
the transactions contemplated by this Agreement.

7.4       Leases and Real Estate.   Except as otherwise provided in Section 12.26 with respect the Sale-Leaseback Properties, subject to entry of the Designation Order by the Bankruptcy
Court, to Seller’s knowledge, Seller has (i) with respect to the Real Estate, fee simple title to such properties, free and clear of all liens, claims, mechanics liens, and encumbrances, to the extent permitted by the Bankruptcy Code (but excluding liens and
encumbrances that will be released at Closing or the Property Closing pursuant to the Designation Order, a Sale Order or otherwise, of the Bankruptcy Court) (collectively “Liens”), other than the Permitted Exceptions, insurable at regular rates by
the title insurer, which will be conveyed at each Property Closing Date, and (ii) with respect to the Leases, leasehold title, and valid leases with respect to such leased properties set forth on either Schedule A or Schedule B, free and clear of all Liens, other
than Permitted

17

  Exceptions, on such Leases (but excluding encumbrances that will be released at the applicable Property Closing by payment, or by establishment of a reserve for any cure in an amount reasonably agreed upon between the
landlord and Seller, or as otherwise ordered by the Bankruptcy Court).  Seller represents and Purchaser acknowledges that Seller has provided to Purchaser information related to the partial taking of Unit 31, located in Upper St. Clair, PA.  Attached hereto
as Schedule 7.4, are copies of correspondence related to said partial taking and the existence of said partial taking shall not be deemed to be a breach of any representation or warranty provided herein by Seller.

7.5       Insurance.  To Seller’s knowledge, all premiums for such insurance have been or shall be paid in full when due unless payable in installments, in which case the
installments have been or shall be paid in full when due.

7.6       Maintenance.  Between the date of this Agreement and the Closing Date Seller shall, subject to the provisions of this Agreement, maintain the Properties as is required for normal
maintenance and upkeep.

7.7       Survival.  The representations, covenants and warranties made by the Seller in this
Agreement shall survive the Closing of this Agreement.

ARTICLE VIII

REPRESENTATIONS AND WARRANTIES OF PURCHASER

Purchaser hereby represents and warrants to Seller as follows:

8.1       Due Incorporation, Etc.  Purchaser is a corporation duly organized, validly existing and in good standing under the laws of the State of its incorporation.

8.2       Authorization, No Conflicts, Etc.  Purchaser has the corporate power and authority, to enter into this Agreement and to carry out its obligations hereunder.  The execution,
delivery and performance of this Agreement by Purchaser and the consummation by Purchaser of the transactions contemplated thereby have been duly authorized by all requisite corporate action.  This Agreement has been duly and validly executed and delivered by
Purchaser; and,subject to the entry and effectiveness of the Designation Order, this Agreement constitutes the valid and binding agreement of Purchaser, enforceable against Purchaser in
accordance with its terms, subject to applicable bankruptcy, reorganization, insolvency, moratorium and other laws affecting creditor’s rights generally from time to time in effect and to general equitable principles.  Neither the execution and deliver of
this Agreement and all documents contemplated hereunder to be executed by Purchaser, nor the performance of the obligations of Purchaser hereunder or thereunder will result in the violation of any law or any provision of the organizational documents of Purchaser or
will conflict with any order or decree of any court or governmental instrumentality of any nature by which Purchaser is bound.

8.3       Consents and Approvals.  To Purchaser’s knowledge, no consent, approval or authorization of, or declaration, filing, or registration with, any United States federal or
state Governmental or regulatory authority is required to be made or obtained by Purchaser in

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  connection with the execution, delivery and performance of this Agreement and the consummation of the transactions contemplated hereby, except (a) for consents, approvals, or authorizations of, or declarations or
filings with, the Bankruptcy Court; and (b) for consents, approvals, authorizations, declarations, filings or registrations, which, if not obtained, would not, individually or in the aggregate, have a material adverse effect on the transactions contemplated by this
Agreement.

8.4       Litigation.  There is no action, suit, inquiry, proceeding or investigation by or before any court or Governmental or other regulatory or administrative agency or commission
pending, or, to the best knowledge of Purchaser, threatened against Purchaser which questions or challenges the validity of this Agreement or in connection with the transactions contemplated thereby; nor, to the best knowledge of Purchaser, is there any basis for any
such action, proceeding or investigation.  To the best of Purchaser’s knowledge there are no circumstances or facts that would prevent Purchaser from engaging in the transactions contemplated in this Agreement.

8.5       WHERE-IS/AS-IS.  Except as otherwise expressly stated in this Agreement, Purchaser and its Designees agree to accept the Real Estate and the Leased Premises in a “WHERE-IS,
AS-IS” condition as of the Property Closing Date.  

8.6       SURVIVAL.  The representations, warranties and covenants of the Purchaser in this Agreement shall survive the
Closing of this Agreement.

ARTICLE IX

COVENANTS PRIOR TO PROPERTY CLOSINGDATE

9.1       Affirmative and Negative Covenants.  Except as expressly set forth below, during the period from the date hereof to the Property Closing Date,

            (a)        Seller covenants and agrees that it shall,
unless otherwise agreed with Purchaser:

                        (i)         Affirmative Covenants Pending Property Closing.

                                    (A)       Maintenance.  Prior to the Property Closing Date with respect to a particular Property, maintain such Property in the same condition as it is today, subject only to ordinary wear and tear, and with respect to
leases, prior to the Effective Date, keep and perform all of its obligations under the Leases, except that Seller may cease to operate its retail operations at and may vacate any of the stores, and may, at its sole and absolute discretion, remove all fixtures, and
personal property located thereon except for the FFE and signage.

                                    (B)       Court Orders.  Seller shall use commercially reasonable efforts to obtain an order or orders of the Bankruptcy Court approving the sale of the Designation Rights.  Seller shall also use its commercially
reasonable efforts to obtain Sale Orders of the Court (from time to time as may be requested by Purchaser) approving the assumption and assignment of Leases or the sale of Real Estate to any Designee.

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                                    (C)       Renewals.  Seller shall take any and all actions necessary to keep the Leases in good standing including, without limitation, exercising any and all renewals, extensions or similar options that may be
exercised from the Closing Date through the Property Closing Date.

                        (ii)        Negative Covenants Pending Closing.  Except as expressly permitted herein, Seller shall not, without the consent of Purchaser (whose consent shall not be unreasonably withheld or
delayed):

                                    (A)       Leases.  Amend the Leases, enter into leases or grant or voluntarily terminate any other interests in the Real Estate or the Leases;

                                    (B)       Encumbrances.  Encumber, sublease or otherwise grant any rights with respect to the Real Estate or the Leases; or

                                    (C)       Contracts.  Enter into any contracts or agreements affecting the Real Estate or the Leases or which will be binding on Purchaser (or its Designee), in any case, from and after the execution of this Agreement unless
such agreements can be terminated upon thirty (30) days notice.

            (b)        Purchaser covenants and agrees that it
shall, unless otherwise agreed with Seller:

                        (i)         Maintain or arrange for funds to be available to satisfy all of Purchaser’s obligations under this Agreement at the time and in the manner set forth herein, including without limitation the payment of
the Purchase Price and the payment of Carrying Cost obligations;

                        (ii)        With respect to each Lease, Purchaser shall use commercially reasonable efforts to provide adequate assurance as required under the Bankruptcy Code of the future performance of the applicable Lease by Purchaser
or its Designee.  Purchaser agrees that it will promptly take, and/or cause its Designee to take, all actions reasonably required by Seller to assist in obtaining the Bankruptcy Court’s entry of the Designation Order and each additional Sale Order, such as
furnishing affidavits, non-confidential financial information or other documents or information for filing with the Bankruptcy Court and making Purchaser’s employees and representatives available to testify before the Bankruptcy Court, with respect to
demonstrating adequate assurance of future performance by a Designee under the Leases.

9.2       Title Insurance.  A Designee may obtain title insurance and/or surveys for any or all of the Properties at their own discretion and at their sole cost and expense.

9.3       Consents and Further Actions.  Subject to the terms and conditions herein provided, Seller and Purchaser covenant and agree to use their good faith efforts to take, or cause to
be taken, all action, or do, or cause to be done, all things, necessary, proper or advisable under applicable laws and regulations to consummate and make effective the transactions contemplated by this Agreement, including all closing conditions to be satisfied.

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ARTICLE X

ADDITIONAL COVENANTS

10.1    
Further Transfers and Assurances.  Seller and Purchaser will execute and deliver such further instruments of conveyance and transfer and take such additional action as Purchaser may reasonably request to effect, consummate,
confirm or evidence the transfer to the Designees of the Real Estate and the Leases.

10.2     Proration Items, Recording Charges and Rents.

            (a)        Special assessments which are due and
payable on or before the Closing Date, taxes (based upon the most recent ascertainable taxes if current tax information is not available) relating to the Real Estate or the Leases and all other costs of operation, maintenance, or repair which are customarily
apportioned on the transfer of similar types of property (including without limitation, water, sewer and utility charges, amounts payable under service contracts, common area maintenance costs, insurance premiums payable to landlords and the like (“Proration
Items”) attributable to time periods before the Closing Date, shall be the responsibility of, and shall be paid by Seller.  Except as otherwise expressly set forth in this Agreement, Proration Items with respect to time periods beginning on the Closing
Date and ending on the Property Closing Date with respect to each parcel of Real Estate or Lease, shall be paid by Purchaser, and will be considered Carrying Costs. 

                        The amount of any Proration Item attributable to a
particular time period shall be computed by multiplying the amount of such Proration Item by the ratio that the number of days in such time period bears to the total number of days in the fiscal period for which such Proration Item is incurred.

            (b)        All transfer, documentary, sales, use,
stamp, registration, conveyance, income, gains, value added or other taxes and fees arising out of the sale of the Real Estate or the Leases and all charges for or in connection with the recording of any document or instrument contemplated hereby shall be paid by the
Designees.  Seller will file all necessary tax returns and other documentation in connection with the taxes and fees encompassed in this Section relating to the recording of Deeds or assignment of Leases.

            (c)        All rent (including additional and/or
percentage rent) with respect to the Properties shall be prorated as of the Closing Date and any special assessments relating to the Properties for any post-Closing period shall be paid by Purchaser.

            (d)        The amount of applicable Prorated Items shall be reflected by a credit
to Seller or Purchaser at Closing that shall be paid to the appropriate party by an increase or decrease in the amount paid by the Purchaser on the Closing Date.  Any Prorated Items estimated by the parties at Closing shall be finalized within sixty (60) days of
the Closing and monies due and owing as a result of such finalization shall be paid by the Seller to the Purchaser or Purchaser to Seller, as the case may be.

10.3    
Insurance.  Without the prior written consent of Purchaser, Seller will not cancel any insurance policy relating to the Properties. 

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10.4    
Omissions.  Seller and Purchaser agree to adjust between themselves after Closing any errors or omissions in the prorations or adjustment set forth in the closing statements and any other prorations or adjustment made
pursuant to the Agreement; provided, however, that the foregoing sentence shall not be deemed to require re-proration of any prorations or adjustments based upon the fact that said prorations or adjustments were estimated using the then most currently
available information due to the actual information not then being available.  Notwithstanding anything contained herein to the contrary, such apportionments shall be deemed final and not subject to further
post-Closing adjustments if no such adjustments have been requested upon the earlier to occur of (a) sixty (60) days after such time as all necessary information is available to make a complete and accurate determination of such apportionments, or (b) six (6) months
after the date of the applicable Property Closing.

10.5     Liquor Licenses.  Until such time as all of the Liquor Licenses have been transferred to Purchaser or any Designee, Seller
shall take all actions necessary to preserve, protect, renew, and retain all rights, title and interests of Seller to the Liquor Licenses.

ARTICLE XI

LEASE ASSIGNMENT

11.1    
Post-Closing Expenses.  Except as otherwise provided in this Agreement, all obligations with respect to the Properties sold to a Designee shall be the sole responsibility of a Designee from and after the Property Closing Date
with respect to the Properties.  Notwithstanding anything to the contrary in the foregoing sentence, or in any other provision of this Agreement, other than with respect to the Carrying Costs, a Designee shall not be liable for any costs, taxes, obligations or
liabilities relating to the Properties which are attributable in any way to, or were incurred during the period prior to the Property Closing Date.

11.2    
Seller's Obligations Regarding Assignment.  With respect to the assignment of any Lease, Seller shall, at its sole cost, (i) cure, or provide a prompt cure of any pre-petition default in base rental or additional rental payments arising under the Lease and outstanding as of the Property Closing Date and required to be paid under Section 365 of the Bankruptcy Code; and (ii) cure any and all other monetary defaults with
respect to the Lease, as required to be cured pursuant to Section 365 of the Bankruptcy Code so that such Lease may be assigned to Purchaser or its Designee in accordance with the provisions of Section 365 of the Bankruptcy Code; provided, however, that Seller shall
not be obligated to cure any such default that is in dispute as of the Property ClosingDate if an escrow or other commercially reasonable arrangement with respect
thereto which is reasonably acceptable to Purchaser shall have been established at or following the Property Closing Date pursuant to an order of the Bankruptcy Court.  Attached hereto as Schedule 11.2 is Seller’s calculation of the pre-petition
cure amounts owed on account of each Lease.   In connection with Seller’s obligations regarding the assignment of any Lease to a Designee, Seller shall be entitled to direct the Escrow Agent to  disburse from the Escrowed Proceeds the cure amount with
respect to such Lease  set forth on Schedule 11.2 (the "Designated Cure Amount").  The funds shall be disbursed as follows: (a) if the amount of cure costs claimed by the landlord is less than the Designated Cure Amount, the Escrow Agent shall
disburse to the landlord the amount of cure costs claimed by the landlord, and shall disburse the

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  balance of the Designated Cure Amount with respect to that Lease to the Seller; (b) if the amount of cure costs claimed by the landlord exceeds the Designated Cure Amount, Escrow Agent shall disburse the Designated Cure
Amount either to the landlord or to an escrow created as described below in this Section 11.2.  Purchaser may instruct Escrow Agent to disburse to Purchaser the amount Purchaser has actually paid with respect to cure costs if such request is made pursuant to the
last sentence of this sub-paragraph.  To the extent that the Designated Cure Amount for any Lease to be assigned to a Designee is not sufficient to pay such cure amount in full, Seller shall either pay such deficiency directly to the Landlord at the Property
Closing on the Property Closing Date, or shall deposit such sum in escrow or other commercially reasonable arrangement with respect thereto in accordance with the Designation Order.  If Seller does not either (i) cure such pre-Closing Date monetary default or
(ii) create an escrow or other commercially reasonable arrangement with respect thereto, or (iii) reach an agreement with the landlord of such lease concerning full and final satisfaction of such Pre-Closing Date default, Purchaser may elect to pay Seller’s
cure obligations and shall recover such payment pursuant to Section 2.5(b)(ii) or Section 2.5(b)(vii) hereof.

11.3     Release of Designated Cure Costs With Respect To Excluded Leases.  If a Lease is excluded by Purchaser pursuant to paragraph
2.4 hereof, Escrow Agent shall disburse to Seller the Designated Cure Amount with respect to that Lease. 

ARTICLE XII

MISCELLANEOUS

12.1     Termination; Other Remedies.

            (a)        This Agreement may be terminated and the
transactions contemplated hereby may be abandoned at any time, but not later than the Closing Date:

                        (i)         by the mutual consent of Purchaser and Seller;

                        (ii)        by Seller, if the Closing does not occur on or prior to the Closing Date, provided, that Seller will not be entitled to terminate this Agreement pursuant to this subsection (ii) if Seller is in material breach of
this Agreement and such breach continues for ten days following written notice from Purchaser to Seller or has failed to satisfy any condition to Closing in Article VI hereof that Seller or its affiliates was required to satisfy and such breach continues for
ten days following written notice from Purchaser to Seller;

                        (iii)       by
Purchaser, if Seller is in material breach of this Agreement and such breach continues for ten (10) days following written notice from Purchaser to Seller; or, in the alternative, by Seller, if Purchaser is in material breach of this Agreement and such breach
continues for ten (10) days following written notice from Seller to Purchaser;

                        (iv)       by
Purchaser or Seller if the Closing Date does not occur prior to September 24, 2004;

                        (v)        by Purchaser as a result of a timely Election; or

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                        (vi)       by Purchaser or Seller, if
such termination is expressly permitted pursuant to another provision of this Agreement.

            (b)        Upon the termination
of this Agreement pursuant to Section 12.1(a), neither Seller nor Purchaser shall have any further liability to the other hereunder, except as otherwise specifically provided in this Agreement.

12.2    
Recordation of Agreement.  Purchaser shall not record, or attempt to record, this Agreement or a memorandum hereof.

12.3    
Successors and Assigns.  This Agreement is made solely and specifically by and for the benefit of the parties hereto, and their respective successors and assigns, including, without limitation, each Designee as to any
Properties transferred to such Designee(s), and any Chapter 7 trustee or liquidating agent or trustee appointed in the Bankruptcy Case.  Purchaser shall be entitled to assign its rights in hereunder to any Purchaser Affiliate or third party.

12.4     Default and Remedies.

            (a)        In the event of a material breach of, or
material default under, this Agreement by Seller prior to the Closing, Purchaser shall, provided Purchaser is not in material breach of or material default under this Agreement, be entitled, as its sole and exclusive remedy, either (i) to seek specific performance of
this Agreement or (ii) to terminate this Agreement and obtain an immediate refund of its Good Faith Deposit.  In the event of a material breach of, or material default under, this Agreement by Seller after the Closing, Purchaser shall, provided Purchaser is not
in material breach of or material default under this Agreement, be entitled, as its sole and exclusive remedy, except as otherwise expressly provided herein, to seek specific performance of this Agreement.

            (b)        In the event of a material breach of, or
material default under, this Agreement by Purchaser prior to the Closing, Seller shall, provided Seller is not in material breach of or material default under, this Agreement, be entitled, as its sole and exclusive remedy, either (i) to terminate this Agreement or
(ii) to seek specific performance of this Agreement.  In the event of a material breach of, or material default under, this Agreement by Purchaser after the Closing, Seller shall, provided Seller is not in material breach of or material default under this
Agreement, be entitled, as its sole and exclusive remedy, to seek specific performance of this Agreement. 

            (c)        Except as otherwise provided in this
Section 12.4, above, no remedy herein or otherwise conferred upon the parties shall be considered exclusive of any other remedy, but the same shall be cumulative and shall be in addition to every other remedy given hereunder or now or hereafter existing at law, in
equity or by statute.

12.5    
Confidentiality.  Purchaser and its agents, officers, employees, and other representatives shall hold in confidence the terms and conditions of all non-public data and information obtained with respect to the Properties and
the Leases; provided, however, that it is understood and agreed (a) that Purchaser may disclose such data and information to the employees, consultants, accountants and attorneys of Purchaser and to any Designee or potential Designee (and to their
employees, consultants, accountants and attorneys ) provided that such Persons agree to treat

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  such data and information confidentially; (b) that disclosure may be made if compelled by law or judicial
process (c) that disclosure may be made to enforce this Agreement in any judicial or quasi-judicial proceeding; (d) that Purchaser or its Designees shall be permitted to make such announcements or disclosures as Purchaser or its Designees shall determine to be
necessary or appropriate to comply with applicable disclosure requirements of state and federal securities laws; and (d) that copies of this Agreement shall be made available to prospective bidders at the Auction pursuant to the Bidding Procedures  This Section
12.5 shall survive the Closing or the earlier termination of this Agreement.

12.6    
Notices.  All notices and other communications hereunder shall be in writing and shall be deemed to have been duly given if and when delivered personally or mailed, by certified or registered mail, return receipt requested,
first class postage prepaid, or by Federal Express or some other reputable overnight carrier (or when delivery is rejected or refused), to the parties at the following addresses:

If to Seller, addressed to:

Chi-Chi's, Inc.

2701 Alton Parkway

Irvine, CA  92606

Attn:  Mr. Tony Baril

With copies (which shall not constitute notice hereunder) to:

 Irell & Manella LLP

840 Newport Center Drive

Suite 400

Newport Beach, CA 92660

Attn:     William N. Lobel, Esq.

If to Purchaser, addressed to:

OS Realty, Inc.

c/o Outback Steakhouse, Inc.

2202 N. West Shore Blvd.

 Tampa, FL  33607

Attention:  Mr. Carl Sahlsten  (Fax Number:  813/282-9195) and Mr. Joseph Kadow (Fax Number:  813/281-2114)

With copies (which shall not constitute notice hereunder) to:

 STICHTER, RIEDEL, BLAIN & PROSSER, P.A.

110 E. Madison St., Ste. 200

Tampa, Florida  33602

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Fax Number:  813/229-1811

Attn:  Harley E. Riedel, Esq.

or to such other place and with such other copies as any party may designate by written notice to this other party.

12.7    
Expenses.  Except as otherwise expressly provided herein, each party shall bear its own legal, appraisal and title costs with respect to the drafting of the agreements involved in these transactions and the closing of such
transactions.

12.8    
Brokerage Commissions and Fees.  Purchaser warrants and represents that no brokerage commissions or fees are due any real estate broker(s) as a result of Purchaser’s actions or omissions in connection with the
transactions contemplated by this Agreement which are to take place at the Closing; and Purchaser agrees that should any claim be made for commissions or fees by any broker(s) against Seller with respect to the transactions contemplated by this Agreement which are to
take place at the Closing, Purchaser will indemnify and hold Seller free and harmless from and against any and all such claims in connection therewith.  Seller warrants and represents that no brokerage commissions or fees are due to any real estate
brokers(s).  Seller agrees that, should any claim be made for commissions or fees by any broker against Purchaser, Seller shall indemnify and hold Purchaser free and harmless from and against any and all such claims in connection therewith.

12.9    
Casualty and Condemnation.  If any one of the Real Estate or the Leased Premises is materially destroyed or materially damaged, or if condemnation proceedings are commenced against any such Real Estate or any Leased Premises,
all proceeds of insurance or condemnation awards shall be paid to and retained by, Purchaser; provided however, that Purchaser may exclude the property that has been damaged, in which event the insurance proceeds shall be
paid to Seller.  In the event of non-material damage or non-material condemnation to any Real Estate or the Leased Premises, which damage Seller is unwilling to repair prior to the applicable Property Closing, the Property Closing shall be unaffected thereby and
any proceeds of insurance or condemnation awards shall be paid to Purchaser.  This Section 12.9 shall contain Purchaser’s sole remedies in the event of any casualty or condemnation of Properties.  Purchaser and Seller
specifically agree that with respect to the partial taking referenced in Section 7.4 above, Purchaser shall not be entitled to any Purchase Price Reduction as a result of the such partial taking and that Purchaser shall be entitled to receive any and all proceeds of
any condemnation award received by Seller.

12.10   Entire
Agreement.  This Agreement supersedes all prior discussions and agreements between the parties with respect to the subject matter hereof and this Agreement, including the schedules and exhibits hereto, and other documents to be
delivered in connection herewith (together with such confidentiality letter), contains the sole and entire agreement between the parties hereto with respect to the subject matter hereof.

12.11  
Waiver.  Any term or condition of this Agreement maybe waived at any time by the party which is entitled to the benefit thereof.  To be effective, each such waiver shall be in writing, shall specifically refer to this
Agreement and the term or condition being waived, and shall be executed by an Authorized Officer of such party.  A waiver on one occasion shall not be deemed

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  to be a waiver of the same or any other breach on a future occasion.  A waiver hereunder shall be effective without an order of the Bankruptcy Court, or notice to the Bankruptcy Court or any third party, in
relation to such waiver.

12.12  
Amendment.  This Agreement may be modified or amended only in a writing duly executed by or on behalf of each of the parties hereto.

12.13   Counterparts;
Facsimile Signatures.  This Agreement may be executed in one or more counterparts, each of which shall be deemed an original, but all of which together shall constitute one and the same instrument.  This Agreement may be
executed and delivered by facsimile.

12.14   Invalid
Provisions.  If any provision of this Agreement is held to be illegal, invalid, or unenforceable under any present or future law, rule, or regulation, such provision shall be fully severable and this Agreement shall be construed
and enforced as if such illegal, invalid, or unenforceable provision had never comprised a part hereof.  The remaining provisions of this Agreement shall remain in full force and effect, and shall not be affected by the illegal, invalid, or unenforceable
provision or by its severance herefrom.  Furthermore, in lieu of such illegal, invalid, or unenforceable provision, there shall be added automatically as a part of this Agreement a legal, valid, and enforceable provision as similar in terms to such illegal,
invalid, or unenforceable provision as may be possible.

12.15   Headings, Gender,
Etc.  The headings used in this Agreement have been inserted for convenience and do not constitute matter to be construed or interpreted in connection with this Agreement.  Unless the context of this Agreement otherwise requires, (a) words of any gender shall be deemed to include each other Gender, (b) words using the singular or plural
number shall also include the plural or singular number, respectively, (c) references to “hereof,” “herein,” “hereby” and similar terms shall refer to this entire Agreement, (d) the words
“include” and “including” shall be construed as incorporating “but not limited to” or “without limitation,” and (e) each reference to Seller shall be a reference to any of its subsidiaries and predecessors and each
representation, warranty, covenant and other agreement made herein with respect to Seller shall be deemed made with respect to all such subsidiaries and predecessors.  The language used in this Agreement shall be deemed to the language chosen by the parties
hereto to express their mutual intent and no rule of strict construction shall be applied against any Person.

12.16   Continuing
Jurisdiction.  The parties agree that the Bankruptcy Court shall retain jurisdiction over the enforcement of this Agreement, including, but not limited to, the performance of the obligations and transactions contemplated
hereunder.

12.17   Choice of
Law.  This Agreement shall be construed, interpreted and the rights of the parties determined in accordance with the laws of the State of Delaware without regard to conflicts of laws principles thereof, except with respect to
matters of law concerning the internal corporate affairs of any corporation or limited liability company which is a party to or the subject of this Agreement, and as to those matters the law of the jurisdiction of incorporation or organization of such entity shall
govern.

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12.18   Obligations Joint
and Several.  Notwithstanding anything to the contrary set forth in this Agreement, the obligations of the Seller and its affiliates; and the Purchaser and its affiliates, shall be joint and several, except as otherwise provided
in this Agreement.

12.19   No Partnership or
Joint Venture.  Nothing contained in this Paragraph or elsewhere in this Agreement shall be deemed to create a partnership, joint venture, or any other relationship other than that of seller and purchaser between the parties
hereto.

12.20   No Third Party
Beneficiaries.  Nothing herein expressed or implied is intended or shall be construed to confer upon or give to any person, firm or corporation, other than the parties hereto, their affiliates and their respective permitted
successors and assigns and Designees, any rights or remedies under or by reason of this Agreement.

12.21  
Employees.  Purchaser and its Designees shall not be deemed an employer with Seller or any of its affiliates or subsidiaries and Purchaser and its Designees shall have no obligation to pay wages or benefits (or to fund any
pension plan) or to employ any employee of Seller or any affiliates or subsidiaries.  All WARN Act or similar obligation shall be Seller’s sole obligation.

12.22  
Cooperation.  Seller shall reasonably cooperate with Purchaser with marketing the Properties and in implementing closings related thereto.  If Purchaser so requests, Seller shall use commercially reasonable efforts to
obtain further extensions of any time periods set forth herein or in the Designation Order (but failure to obtain such extension shall not constitute a default hereunder).  Purchaser shall provide status
reports, from time to time, to Seller relating to marketing efforts and Carrying Costs, etc., as reasonably requested by Seller.

12.23   Southgate, Michigan.  Seller shall have the right to exclude
the Southgate, Michigan property including FFE and Liquor Licenses related thereto from this Agreement prior to October 1, 2004 upon written notice to Purchaser accompanied by a cashier's check, or a bank wire, in the amount of $1,100,000.  Seller shall have the
Carrying Costs obligation for the Southgate, Michigan property through September 30, 2004 and in the event Seller elects to exclude the Southgate, Michigan property, Purchaser shall have no obligation whatsoever to pay the Carrying Costs obligation for this
property.

12.24   Power of Attorney.  If at any time the Seller no longer has any employees, including employees of Prandium, Inc. who are responsible
for Seller’s operations, or at any time that Purchaser reasonably determines that a Property Closing will not occur as a result of Seller’s unavailability, then in such events Seller shall be deemed to constitute and appoint Purchaser as its true and
lawful attorney-in-fact and agent, with full power of substitution and re-substitution for it and in its name, place and stead, in any and all capacities, to execute and deliver any and all documents in connection with the designation of the Properties hereunder to
any one or more Designees and to take any and all other actions as Purchaser may deem necessary or appropriate in connection therewith, granting unto said attorney-in-fact and agent full power and authority to do and perform each and every act and thing requisite and
necessary fully to all intents and purposes as Seller might or could do in person, thereby ratifying and confirming all that said attorney-in-fact and agent, or its substitute or substitutes, may lawfully do or cause to be done by virtue hereof.  The powers
granted herein shall terminate as of the expiration of Purchaser’s

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  designation rights in accordance with Section 2.7 above.  Seller hereby agrees to execute any separate powers of attorney in recordable form as Purchaser may from time to time request in connection with the
transfer of any Property to any Designee.

12.25   Acceptance of Cash Purchase Price.  Seller’s acceptance of the Cash Purchase Price shall be in full and
final satisfaction of any and all consideration to be received on account of the conveyance of the Designation Rights to Purchaser.  Seller shall waive any and all rights to future compensation on account of the Properties and the conveyance of the Designation
Rights except to the extent Properties are excluded pursuant to paragraph 2.4 hereof, or leases are not designated prior to the Extension Period and revert to Seller pursuant to paragraph 2.7 hereof.

12.26   Sale-Leaseback Properties. 

            (a)        The Seller’s rights with respect to each Sale-Leaseback Property include the
following:

                        (i)         Seller’s rights and interests
under that certain Real Estate Sale and Leaseback Agreement (the “Sale and Leaseback Agreement”) entered into December 10, 1985 between certain of the entities constituting Seller (including where applicable as successor by merger or otherwise by
operation of law) and C-C Restaurant, Ltd.-9, a California limited partnership (“CC 9”);

                        (ii)        Seller’s right, title and interest
under the Lease Agreement between CC 9 and Seller (including where applicable as successor by merger or otherwise by operation of law) with respect to each Sale-Leaseback Property (each a “CC 9 Lease Agreement”), including the right to terminate such CC 9
Lease Agreement under Section 1.c thereof and receive a conveyance of the Premises (as defined in the CC 9 Lease Agreement) and the right to purchase the Premises from CC 9 pursuant to Section 25 of the CC 9 Lease at the expiration of the Primary Term (as defined in
the CC 9 Lease Agreement) or any Renewal Term (as defined in the CC 9 Lease Agreement);

                        (iii)       A PM Note (as defined in the Sale and
Leaseback Agreement) payable to Seller (including where applicable as successor by merger or otherwise by operation of law) secured by a PM Mortgage (as defined in the Sale and Leaseback Agreement) on each of the Sale-Leaseback Properties subordinate only to a First
Mortgage (as defined in the Sale and Leaseback Agreement);

                        (iv)       A Maintenance Fee Note (as defined in the Sale
and Leaseback Agreement) payable to Seller (including where applicable as successor by merger or otherwise by operation of law) secured by a Maintenance Fee Mortgage (as defined in the Sale and Leaseback Agreement); and

                        (v)        A Bridge Note (as defined in the Sale and
Leaseback Agreement) payable to Seller together with a Security Agreement (as defined in the Sale and Leaseback Agreement) and Negative Pledge Agreement (as defined in the Sale and Leaseback Agreement) securing the Bridge Note and the General Partners Guaranty (as
defined in the Sale and Leaseback Agreement).

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            (b)        Seller hereby covenants that it will not make any changes or modifications to or cause to
be changed or modified any of the documents referenced in Sections 12.26(a) above, nor will Seller take fee simple title to any of the Sale-Leaseback Properties without prior written consent of Purchaser.

            (c)        In the event that during the Designation Period, Seller obtains fee simple title to any of
the Sale-Leaseback Properties, free and clear of the claims of CC 9, James Robinson, or any successor or assign of CC 9 and/or James Robinson, then each such Sale-Leaseback Property shall constitute “Real Estate” hereunder, to the extent that such status
affords Purchaser the Designation Rights with respect to such Real Estate, and the terms hereof applicable to Real Estate shall then apply; provided, however, that Seller shall transfer to Designee the same title that Designee would have received had the transfer
been made directly from CC 9 to Designee.

            (d)        If Seller does not obtain fee simple title to a Sale-Leaseback Property then the CC 9
Lease for such Sale-Leaseback Property shall constitute a “Lease” hereunder.  In the event that Purchaser exercises its Designation Rights to such a Sale-Leaseback Property, then at the Property Closing with respect to the CC 9 Lease for such
Sale-Leaseback Property, Seller shall have leasehold title and a valid lease with respect to such Sale-Leaseback Property free and clear of all Liens (except any liens, claims or encumbrances deriving through CC 9 and/or James Robinson to the extent that the
existence of said liens, claims or encumbrances does not constitute a breach of the representations and warranties contained in this Section 12.26), other than Permitted Encumbrances (but excluding encumbrances that will be released at the applicable closing by
payment, or by establishment of a reserve for any cure in an amount reasonable agreed upon between landlord and Seller or as otherwise ordered by the Bankruptcy Court.  Seller shall transfer to Purchaser as and when requested by Purchaser, all of Seller’s
right, title and interest in and to the Sale and Leaseback Agreement, PM Note, PM Mortgage, Maintenance Fee Note and Maintenance Fee Mortgage with respect to such Sale-Leaseback Property.  Seller shall transfer to Purchaser as and when requested by Purchaser,
all of Seller’s right, title and interest in and to the Bridge Note, Security Agreement, Negative Pledge Agreement and General Partners Guaranty.

            (e)        On the Closing Date, Seller shall make the following additional representations and
warranties, based upon Seller’s current management’s knowledge and belief, without having undertaken any specific investigation related to the subject matter of the representations and warranties provided immediately below,  with respect to each such
Sale-Leaseback Property:

                        (i)         Seller is not aware of any facts
that would give rise to a valid defense, affirmative defense, counterclaim or right of offset by CC 9 and/or James Robinson.

                        (ii)        Seller’s records indicate that
Schedule 12.26 attached hereto and incorporated herein by reference sets forth (A) all payments received by Seller on account of the Bridge Note; (B) the balance due on account of the Bridge Note; and (C) the maturity date of the Bridge Note.

30

                        (iii)       To the best of Seller’s present
management’s knowledge the Seller’s internal calculations show balances due on account of each PM Note in the amount reflected on Schedule 12.26A.

            (f)         At the time of the transfer referenced in Section 12.26 (d), Seller further
represents and warrants with respect to each Sale-Leaseback Property that:

                        (i)         There have been no payments made on
account of any PM Note.

                        (ii)        There is no document signed by Seller
which would (A) invalidate the PM Note or the PM Mortgage or the lien created thereby, or (B) affect the balance of the PM Note.

                        (iii)       Seller is the holder and the sole owner of
each PM Note and each PM Mortgage and other loan documents executed in connection therewith, free and clear of any and all claims, liens, charges or encumbrances (except any liens, claims or encumbrances deriving through CC 9 and/or James Robinson to the extent that
the existence of said liens, claims or encumbrances does not constitute a breach of the representations and warranties contained in this Section 12.26); and upon entry of the Designation Order, Seller has full power and authority to transfer each PM Note and each PM
Mortgage and all other related loan documents to any Designee free and clear of all claims, liens, charges, or any encumbrances; such Designee will receive the PM Note, the PM Mortgage and other loan documents with respect to each Sale-Leaseback Property designated
hereunder free and clear of all claims, liens charges, or any encumbrances; and Seller has not previously pledged, hypothecated, encumbered, assigned or otherwise transferred, in whole or in part, its interest in any PM Note, any PM Mortgage, or any of the other loan
documents related thereto.

            (g)        To the extent that Purchaser suffers actual monetary damages as a result of a breach of
any of the above representations and warranties, Purchaser shall be entitled to a Purchase Price Reduction in an amount equal to the monetary damages so suffered; provided however, to the extent that Purchaser was aware as of the Closing Date of some thing or event
that would make  the applicable Seller's representations and warranties not true and correct as of the date given, Purchaser shall not be entitled to recover any damages suffered as a result of that thing or event and Seller’s representations to that
extent will be deemed to not have been breached.  To the extent Purchaser obtains fee simple title to the Sale-Leaseback Properties without the payment of any additional consideration, Purchaser will be conclusively presumed to not have suffered any
damages.

            (h)        Seller shall take all such action as the Designation Rights Purchaser may reasonably
require to enforce Seller’s rights to require the lessor of the Sale-Leaseback Properties to deliver fee simple title to those properties to a Designee for no additional consideration beyond the remaining lease payments, including, without limitation thereto,
the filing and prosecution, at no cost to Purchaser, of a declaratory relief action to determine the rights of the parties with respect to the Sale-Leaseback Properties.  Seller shall support Purchaser’s right to participate in the declaratory relief
action.  Except for costs incurred in connection with the filing and prosecution

31

  of the declaratory relief action, Purchaser shall be responsible for costs incurred in connection with the Sale-Leaseback Properties as provided in Section 2.6.

12.27   Landlord Indemnification Claims. 

            (a)        As to occurrences before October 8, 2003, to the extent Purchaser pays any landlord
indemnification claims on account of any Lease designated hereunder, Purchaser shall be entitled to reimbursement in accordance with Section 2.5(b)(ii)(D);

            (b)        Upon receipt by Purchaser of a claim for indemnification by a landlord based upon an
occurrence before October 8, 2003, Purchaser shall notify Seller of such claim and Seller shall have the right at its option and expense to defend such claim, provided, however, that the Seller shall not have the right to act in any manner with respect to the claim
that would give the landlord a right to validly declare the Lease to be in default.  In the event Seller elects to not defend said claim or acts in a manner that would give the Landlord a right to validly declare the Lease to be in default, Purchaser may defend,
settle, or pay the claim and be entitled to reimbursement in accordance with Section 2.5(b)(ii)(D);

            (c)        Upon receipt by Purchaser of a claim for indemnification by a landlord based upon an
occurrence on or after October 8, 2003, Purchaser shall notify Seller of such claim and Seller shall have the right at its option and expense to defend such claim, provided, however, that the Seller shall not have the right to act in any manner with respect to the
claim that would give the landlord a right to validly declare the Lease to be in default.  In the event Seller elects to not defend said claim or acts in a manner which gives the landlord the right to validly declare the Lease to be in default, Purchaser may
defend, settle, or pay the claim and be entitled seek reimbursement for any payment made in connection therewith pursuant to Section 2.5(b)(ii) or if sufficient funds are not available in the escrow, as an Allowed Administrative Claim pursuant to 2.5(b)(vii). 
Seller and Purchaser agree to cooperate with each other with respect to a response to any landlord indemnification claim.  In the event the Seller and Purchaser cannot reach agreement as to the amount of an indemnification claim that should be paid to a
landlord, or whether a payment is necessary in order to avoid giving a landlord the right to validly declare a default under the Lease, Seller and Purchaser agree to raise the issue in the Bankruptcy Court, and to be bound by the Bankruptcy Court's decision in that
regard.

            (d)        With respect to claims known to Seller prior to expiration of any applicable bar dates
including, without limitation, any administrative claim bar date, based upon occurrences on or after October 8, 2003,  but before the Property Closing Date with respect to any Property, Seller shall (i) give notice to the Landlord and to any and all such known
claimants (i.e., claimants that have filled out an incident report, made some form of written demand upon Seller, or Seller’s employees have created a record of such occurrence) who may have a claim of any nature against Seller of (A) the designation of such
Lease, (B) the Bankruptcy Case, and (C) any applicable bar dates including, without limitation, any administrative claim bar date; (ii) obtain a waiver or release barring the assertion of any such rights or claims under the Lease against the Designee; or (iii) obtain
a Bankruptcy Court order waiving or barring the assertion of any rights or claims under the Lease against the Designee.

32

            (e)        With respect to occurrences after the applicable Property Closing Date, or to the extent
any claim is not known to Seller prior to the expiration of any applicable bar dates, including any administrative claims bar date, regardless of when such claim arose, Seller shall have no liability with respect thereto.

            (f)         Seller acknowledges that with respect to any and all claims arising from the
Hepatitis A outbreak at its Beaver Valley Mall location, (i) Seller has insurance coverage to address potential landlord indemnification claims and (ii) Purchaser will not have any liability with respect to any such landlord indemnification claims should such claims
arise.

            In connection with any and all pre-Property Closing Date customer claims under the Leases, Seller hereby represents, warrants and covenants to the best of its
knowledge and belief without having undertaken any additional investigation to Purchaser that (i) Seller has provided Purchaser with summaries concerning any and all known pre-Property Closing Date customer claims (ii) that it will continue to provide Purchaser with
additional summaries in any way related to such claims, including, without limitation, any information related to a potential claimant that was unknown to Seller as of the date hereof but becomes known to Seller subsequent to the date hereof and prior to the
expiration of Seller’s designation rights under Section 2.7 above.

	

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33

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

SELLER:

CHI-CHI’S, INC., a Delaware corporation, on its own behalf and on behalf of each of its subsidiaries or affiliates set forth on Exhibit A attached
hereto                                                                

By:       ______________________________

                                                                                   

Name:  ______________________________

                                                                                   

Its:        ______________________________

PURCHASER:

OS REALTY, INC., a Florida corporation

By:_________________________

Carl W. Sahlsten

Vice Pres. of Real Estate and Development

 

 

 

 

 

 

 

EXHIBIT A

SELLER ENTITIES

1.         Chi-Chi’s, Inc., a Delaware corporation

2.         CCMR of Catonsville, Inc.

3.         CCMR of Cumberland, Inc.

4.         CCMR of Frederick, Inc.

5.         CCMR of Greenbelt, Inc.

6.         CCMR of Harford County, Inc.

7.         CCMR of Maryland, Inc.

8.         CCMR of Ritchie Highway, Inc.

9.         CCMR of Timonium, Inc.

10.       Chi-Chi’s of West Virginia, Inc.

11.       Maintenance Support Group, Inc.

EXHIBIT B

FORM OF DESIGNATION ORDER

IN THE UNITED STATES BANKRUPTCY COURT

FOR THE DISTRICT OF DELAWARE

                                                                                   
)

In
re:                                                                           
)           Chapter 11

                                                                                   
)

CHI-CHI’S, INC. et
al.,                                             
)           Case No. 03-13063

                                                                                   
)           Jointly Administered

             
                                  
Debtors.                       )          

                                                                                                
Related Docket No. 981

ORDER UNDER 11 U.S.C. §§ 105, 363, AND 365 AND

FED. R. BANKR. P. 2002, 6004 AND 6006 (I) AUTHORIZING THE

DEBTORS TO ENTER INTO SALE AGREEMENT PURSUANT TO WHICH THE

RIGHT TO SELL THE DEBTORS’ INTEREST IN ITS REAL PROPERTY AND TO DIRECT AND DESIGNATE THE ASSIGNMENT OF THE DEBTORS’ INTERESTS IN THE LEASES FOR CERTAIN OF THEIR LEASED REAL PROPERTY WHICH WILL BE SOLD FREE AND CLEAR OF CLAIMS, LIENS AND ENCUMBRANCES, (II)
APPROVING A PROCESS FOR THE SUBSEQUENT SALE OF THE REAL PROPERTY AND ASSUMPTION AND ASSIGNMENT OF THE LEASES FOR SUCH LEASED REAL PROPERTY TO DESIGNEES, AND (III) GRANTING OTHER RELIEF

Upon the motion, dated June 24, 2004 (the “Motion”) of Chi-Chi’s, Inc, a Delaware corporationand certain of its domestic subsidiaries and affiliates, debtors and
debtors-in-possession in the above-captioned cases (collectively, “Debtors”), for an order, pursuant to sections 105, 363, and 365 of title 11, United States Code (the “Bankruptcy Code”), and Rules 2002, 6004 and 6006 of the
Federal Rules of Bankruptcy Procedure (the “Bankruptcy Rules”), (i) authorizing the Debtors to sell Designation Rights1 to KIMGB2, LLC(“KIMGB”) or a person or entity submitting a higher or better
offer in this case,   OS REALTY, INC., as the “Successful Bidder,” which   shall be referred to herein as the “Designation Rights Purchaser”) in accordance with the terms and conditions of the Designation Rights
Agreement, dated as of July 23, 2004

___________________

1              Capitalized terms not defined herein have the meanings ascribed to them in the Designation Rights Agreement.

between OS Realty, Inc. ("OSR") and the Debtors, as amended at the Auction and as further amended or memorialized by that certain Designation Rights Agreement dated as of August 30, 2004, a copy of which is attached
hereto and incorporated by reference as Exhibit “A,” (as it may hereafter be further amended by the Debtors and the Designation Rights Purchaser from time to time, the “Designation Rights Agreement,”), and (ii) approving a process for
the subsequent transfer or sale of the Real Estate, FFE, Liquor Licenses  and other assets as described in the Designation Rights Agreement and for the assumption and assignment of the Leases (such Leases, Real Estate, and other assets, along with rights of the
Debtors in and with respect to the Real Estate and the Leased Premises, including (without limitation) all rights of the Debtors in or to any of the improvements located thereon, are sometimes hereinafter referred to, collectively, as the “Property or
Properties”;2 said premises and said improvements located thereon are sometimes referred to, collectively, as the “Premises”) by the Debtors, as directed by the Designation Rights Purchaser, to anyone whatsoever, including
(without limitation), the Designation Rights Purchaser, affiliates of the Designation Rights Purchaser, or third-parties (any such transferee or assignee is hereinafter sometimes referred to as a “Designee” and are, collectively, sometimes
hereinafter referred to as “Designees”); and upon the record of the hearing held on July 15, 2004, at which the Court granted an order approving the bidding procedures and bidding protections governing the Auction (the “Bidding Procedures
Order”); and upon the record of the hearing (the “Sale Hearing”) held at 2:00 p.m. on August 3, 2004 to

___________________

2               The Debtors have both leasehold and non-leasehold rights and interests in the Sale/Leaseback
Properties.  The terms “Lease” or “Leases” as used herein applies to the Debtors’ leasehold interests in the Sale/Leaseback Properties.  The terms “Property” or “Properties” as used herein applies to all
of the Debtors’ interests in or related to the Sale/Leaseback Properties, including (without limitation) the Debtors’ Purchase Money Notes and Mortgage and options to purchase.

consider approval of the Designation Rights Agreement submitted by the Successful Bidder; and good and sufficient cause appearing therefore, the Court hereby makes the following:

FINDINGS OF FACT AND CONCLUSIONS OF LAW:3

Jurisdiction, Final Order and Statutory Predicates

            A.        The Court has jurisdiction over the Motion pursuant to 28 U.S.C. §§ 157 and 1334,
and this matter is a core proceeding pursuant to 28 U.S.C. § 157(b)(2)(A), (N) and (O).  Venue of these cases and the Motion in this district is proper under 28 U.S.C. §§ 1408 and 1409.

            B.         This Order constitutes a final and appealable order within the meaning of 28 U.S.C.
§ 158(a).

            C.        The statutory predicates for the relief sought in the Motion include sections 105(a), 363,
365, and 525 of the Bankruptcy Code and Bankruptcy Rules 2002, 6004, 6006 and 9014.

Retention of Jurisdiction

            D.        Itis necessary and appropriate for the Court to retain exclusive
jurisdiction to, among other things, interpretand enforce the terms and provisions of this Order and the Designation Rights Agreement, and to adjudicate, if necessary, any and all disputes concerning or relating in any way to, or affecting,
any of the transactions contemplated under the Designation Rights Agreement and to determine those issues brought before the Court pursuant to the Designation Rights Agreement.

___________________

3               Findings of fact shall be construed as conclusions of law and conclusions of law shall be construed as
findings of fact when appropriate.  See Fed. R. Bankr. P. 7052.  Decretal provisions of this Order shall have the same effect whether they are included in the Findings of Fact and Conclusions of Law or elsewhere in this Order.

Notice of the Motion

            E.         Due and adequate notice of the Motion, the Designation Rights Agreement, the Auction,
the hearings, and the subject matter thereof was given to all parties in interest, and no other or further notice is necessary.  A draft of this Order was attached to the Motion.  A reasonable opportunity to object or be heard with respect to the Motion,
the relief requested therein, and to the draft order attached to the Motion has been afforded to all interested persons and entities.  Timely objections of parties were dealt with by stipulation and were resolved  (see docket nos. 985-993) or
overruled. 

Sound Business Judgment

            F.         The relief requested in the Motion is in the best interests of the Debtors, their
estates, their creditors, and other parties-in-interest.  The Debtors have demonstrated good, sufficient, and sound business purposes and justifications for the relief requested in the Motion.

Good Faith of Designation Rights Purchaser and Designees

            G.        A “stalking horse” agreement containing both cash and contingent future payments
to the Debtor was negotiated and proposed between KIMGB and the Debtors and executed by those parties subject to Court approval, in good faith, from arm’s-length bargaining positions, and without collusion.  The Successful Bidder timely submitted a
qualified competing bid in the form of the “stalking horse” agreement but containing an option, as set forth in Section 13.26 of the Successful Bidder’s initial bid, in favor of the Debtors under which, inter alia, they could elect a higher
cash payment to be paid in cash or deposited into escrow by the Successful Bidder/Designation Rights Purchaser at Closing in lieu of the contingent future consideration.  The Debtors, KIMGB and the Successful Bidder were all represented by counsel. 
The

Successful Bidder/Designation Rights Purchaser proposed its competing bid in good faith and without collusion and, as set forth below, participated in the Auction in good faith.  The Designation Rights Purchaser is not an
insider or affiliated with the Debtors, is a good faith purchaser within the meaning of section 363(m) of the Bankruptcy Code, and is entitled to the protection thereof.  Neither the Debtors nor the Designation Rights Purchaser have engaged in any conduct that
would cause or permit the Designation Rights Agreement, or the sale of the Designation Rights and the subsequent transfer of the Properties to the Designation Rights Purchaser pursuant hereto, to be avoided under section 363(n) of the Bankruptcy Code.  Subject
to the provisions herein, the Designees (as defined herein), and including the Designation Rights Purchaser and its affiliates, shall also be determined to be good faith purchasers within the meaning of section 363(m) of the Bankruptcy Code and shall be entitled to
all of the protections arising thereunder without further order of Court.

The Auction

            H.        In accordance with the Bidding Procedures Order and the bidding procedures provided
thereunder, the Debtors determined that they had received two qualified competing bids, each of which constituted a higher and better offer than the stalking horse agreement.  The Debtors accordingly conducted the Auction on July 30, 2004 in Newport Beach,
California.  The three competing bidders, including KIMGB and the Successful Bidder, attended the Auction, as did the Debtors’ senior management, respective counsel and financial advisors for the official committee of unsecured creditors (the
“Committee”) and the Debtors, representatives of the DIP Lender and other interested parties.  At the Auction, following certain clarifications, representations, and discussions, the Debtors considered competing bids for the Designation Rights. 
Each bidder was offered opportunities to increase their bids in an effort to obtain the highest or best bids for the Designation Rights or all of the Properties.

            I.          The Designation Rights Agreement contains terms and conditions beneficial to the
Debtors which constitute the highest and best offer for the Designation Rights and the Properties.  These terms are set forth in detail in the Designation Rights Agreement, and some of the significant terms are summarized below:4

                                    (a)        The
Purchase Price is fixed at $42.5 million payable in cash on the Closing Date (less the Good Faith Deposit already delivered to the Debtors and subject to a reduction of $1.1 million if the Debtors elect to exclude the Southgate, Michigan Property) subject to
prorations, reductions, and adjustments set forth in the Designation Rights Agreement;

                                   
(b)        The Debtors shall escrow the sum of $8 million out of the Purchase Price paid at Closing (the “Escrowed Proceeds”) with Wilmington Trust Company or such other escrow agent mutually acceptable to Seller and
Purchaser (the “Escrow Agent”) to be disbursed by the Escrow Agent in accordance with the Designation Rights Agreement;

                                   
(c)        To the extent that the Escrowed Proceeds related to pre-Closing Date cure costs are not sufficient to pay all such cure costs on all Leases to be assumed and assigned to Designees, the Debtors shall pay such pre-Closing
Date cure costs to directly the Landlord at each Property Closing or provide for an escrow for any disputed amounts as now specifically set forth in paragraph 15 below;

                                   
(d)        Subject to the $500,000 cap on landlord indemnification claims as set forth in the Designation Rights Agreement, to the extent that the Escrowed Proceeds are not sufficient to reimburse the Designation Rights Purchaser
for each item set forth in Section 2.5(b)(ii) of the Designation Rights Agreement, the Designation Rights Purchaser is hereby granted an allowed claim under Section 364 of the Bankruptcy Code with administrative priority status over any and all other costs and
administrative expenses,

___________________

4               In the event of any inconsistency between the summary contained below and the Designation Rights Agreement,
the Designation Rights Agreement shall control.

                                               
including, without limitation, the kind specified in Sections 105, 326, 330, 331, 503(b), 506, 507(a), 507(b) and 726 of the Bankruptcy code (the “Allowed Administrative Claim”).  The Designation Rights Purchaser is authorized to file an estimated
Allowed Administrative Claim in accordance with the Designation Rights Agreement.  Further, the Designation Rights Purchaser’s ability to recover on account of its Allowed Administrative Expense Claim shall not be adversely affected by Section 365(k) of
the Bankruptcy Code which has been waived by the Debtors pursuant to the Designation Rights Agreement;

                                    (e)        The
Debtors have no rights, monetary or otherwise, respecting future sales or dispositions of the Properties, including any Proceeds derived from the Properties, all of which shall be retained by the Designation Rights Purchaser for its own account; except (i) with
respect to properties that are excluded by OSR pursuant to paragraph 2.4 of the Designation Rights Agreement, (ii) with respect to leases which revert to Debtors pursuant to paragraph 2.7 of the Designation Rights Agreement (but subject to the Designation Rights
Purchaser’s right to elect to retain the FFE and/or Liquor Licenses under Section 2.1(b) of the Designation Rights Agreement), and (iii) the proceeds from the sale of the Southgate, Michigan, Property, if excluded by the Debtors; 

 

                                   
(f)         So long as the Debtors are not in default of their obligations under the Designation Rights Agreement, the Designation Rights Purchaser shall be obligated, to pay any Carrying Costs in accordance with and subject to
the terms of the Designation Rights Agreement.  Pursuant to the Designation Rights Agreement, the Designation Rights Purchaser shall pay the Carrying Costs to the Debtors via wire transfer to a separate bank account established by the Debtors for the sole
purpose of paying Carrying Costs under the Designation Rights Agreement.  The Court hereby imposes a trust on all monies deposited by the Designation Rights Purchaser into this segregated bank account, which shall not be considered property of the Debtors or the
Debtors’ estate.  The Debtors shall not commingle any funds with the funds deposited by the Designation Rights Purchaser into the separate bank account and shall use such deposited funds solely for the purpose of paying Carrying Costs pursuant to the
Designation Rights Agreement.  The Designee shall be liable for all Carrying Costs after the Property Closing Date;

                                    (g)        The
Designation Rights Purchaser shall be entitled to all rights and benefits under the Designation Rights Agreement, including the entitlement to receive title to those Properties that it elects to designate and the entitlement to exclude Properties that it elects not
to designate.  With respect to the Sale/Leaseback Properties, the Debtors shall take all such action as the Designation Rights Purchaser may reasonably require to enforce the Debtors’ rights to require the lessor of the Sale/Leaseback properties to deliver
fee simple title to those properties to the Designation Rights Purchaser for no additional consideration beyond the remaining lease payments including, without limitation thereto, the filing and prosecution, at no cost to the Designation Rights Purchaser, of a
declaratory relief action to determine the rights of the parties with respect to the Sale/Leaseback Properties as more specifically set forth in the Designation Rights Agreement.5  The Debtors will assign and transfer to the Designation Rights
Purchaser, at its request, or to its Designees, all of the Debtor’s right, title and interest to the leases, options to purchase, rights of first refusal, interests, notes, claims, rights, collateral, and title pertaining to those properties, including (without
limitation) the Purchase Money Notes and Mortgages and the Bridge Note (if requested to do so) as more specifically provided in the Designation Rights Agreement, following which transfers and assignments the Designation Rights Agreement may, inter alia,
sue and foreclose upon such Purchase Money Notes and Mortgages;

                                    (h)        The
Designation Rights Purchaser may allocate the Purchase Price among the Properties as it deems fit;

                                   
(i)         The Debtors and OSR shall perform all of their obligations under the Designation Rights Agreement, and the Debtors shall promptly transfer title to the Properties and assignments of the Leases as directed by the
Designation Rights Purchaser. 

Based upon the results of the Auction, the Debtors, in consultation with the Committee, determined that the bid of OSR was the highest and best offer for the Designation Rights in light of the agreement
by Outback Steakhouse, Inc. (“OSI”) to guaranty the full and prompt performance of all obligations of OSR under the Designation Rights Agreement, including the payment of the Purchase Price (as defined in the Designation Rights Agreement).  The
Debtors,

___________________

5               Nothing herein or in the Designation Rights Agreement shall prejudice any right of the Debtors to recover
their costs of prosecuting any action related to the Sale-Leaseback Properties from any party other than the Designation Rights Purchaser or its Designees, including (without limitation) C-C Restaurant, Ltd.-9, a California Limited Partnership and its partners or
members.

  in consultation with the Committee, believe that the accepted Designation Rights bid will maximize the total consideration paid for the Properties.

Highest and Best Offer

            J.          The consideration provided by the Designation Rights Purchaser for the
Designation Rights pursuant to the Designation Rights Agreement (i) is fair and reasonable, (ii) in light of the agreement by OSI to guaranty the full and prompt performance of all obligations of OS Realty, Inc. under the Designation Rights Agreement, including the
payment of the Purchase Price, in cash, at closing (subject to appropriate prorations), is the highest and best offer for the Designation Rights, (iii) will likely provide a greater recovery for the Debtors’ creditors than would be provided by any other
practical available alternative, and (iv) constitutes reasonably equivalent value and fair consideration under the Bankruptcy Code and under the laws of the United States, any state, territory, possession or the District of Columbia.  The Debtors’
determination that the Designation Rights Agreement constitutes the highest and best offer for the Designation Rights constitutes a valid and sound exercise of the Debtors’ business judgment.

Requirements of Section 363(f) of the Bankruptcy Code Are Satisfied

            K.        The Debtors may sell the Designation Rights free and clear of all claims, liens, mortgages
and encumbrances of any kind or nature whatsoever, other than the Permitted Encumbrances (as defined below), because, in each case, one or more of the standards set forth in sections 363(f)(1)-(5) of the Bankruptcy Code have been satisfied.  Those holders of
claims, liens, mortgages and encumbrances who did not object, or who withdrew their objections, to the Motion or the relief requested therein are deemed to have consented pursuant to section 363(f)(2) of the Bankruptcy Code.  Those holders of liens, claims,
mortgages and encumbrances who did object fall within one or more of the other subsections of section 363(f) of the Bankruptcy Code and are adequately protected by having their liens, claims and encumbrances, if any, attach to the portion of the cash proceeds of the
consummation of the transactions contemplated by the Designation Rights Agreement ultimately attributable to the Property against or in which such holder asserts a lien, claim or encumbrance which is payable to the Debtors pursuant to the Designation Rights
Agreement.

            Notwithstanding anything herein to the contrary, the written agreements and settlements of Affected Lease Parties or Affected Real Estate
Parties (collectively hereafter the “Affected Parties”) (see docket nos. 985-993), on the one hand, and the Debtors, on the other hand, relating to the relief sought in this Order are (a) hereby approved and (b) shall govern and control to the
extent inconsistent with this Order.

Consent of Official Committee

            L.         The Committee supports the entry of this Order and the consummation of the
transactions contemplated by the Designation Rights Agreement.

No Successor Liability

            M.        The transfer pursuant to the Designation Rights Agreement of the Designation Rights to the
Designation Rights Purchaser, and the subsequent transfer, sale and assignment pursuant to the Designation Rights Agreement of the Properties to the Designation Rights Purchaser, OSI,  or any other Designee, as the case may be, of the Properties, do not and will
not subject or expose the Designation Rights Purchaser, or any Designee, as the case may be, or any of their respective affiliates, successors, predecessors, shareholders, members, partners, directors, officers, managers, employees, insiders, agents, representatives
or advisors, to any liability, claim, cause of action or remedy by reason of such transfers under (A) the laws of the United States, any state, territory, or possession thereof, or the District of Columbia, based on, in whole or in part, directly or indirectly,
including, without limitation, any theory of tort, creditors’ rights, equity, antitrust, environmental, successor or transferee liability, labor law, de facto merger, or substantial continuity, or (B) any employment contract, understanding or
agreement, including, without limitation, collective bargaining agreements, employee pension plans, or employee welfare or benefit plans.

            N.        Nothing in this Order or the Designation Rights Agreement expands, affects, releases,
nullifies, or enjoins the enforcement of any liability to a governmental unit under environmental statutes or regulations that any entity would be subject to as the owner or operator of property after the date of entry of this Order.  The acquisition of the
Designation Rights does not, absent the subsequent acquisition of title to the real estate or leasehold interests by the Designation Rights Purchaser, impose any liability on the Designation Rights Purchaser.  The Designation Rights Purchaser shall retain all
claims against the Debtors and other third parties, including their predecessors in title, for pre-Closing contamination of such Properties.

            O.        Neither the Designation Rights Purchaser, OSI nor any Designee is or will be assuming any of
the Debtors’ obligations to their employees (including, without limitation, any obligations under the Debtors’ collective bargaining agreements).

            P.         No common identity of officers or directors exists among the Designation Rights
Purchaser, on the one hand, and the Debtors, on the other.

            Q.        The Designation Rights Purchaser is purchasing the Designation Rights and, as contemplated
by the Designation Rights Agreement and pursuant to the procedures established by the Designation Rights Agreement and this Order, certain Designees will be purchasing the Property.  The Designees shall have the right to purchase the FFE and the Liquor Licenses
pursuant to the terms and provisions of the Designation Rights Agreement.  Any prohibition or restriction on the transfer of the Liquor Licenses is set aside to the maximum extent permitted by the Bankruptcy Code and applicable non-bankruptcy law.

Cure Payments Under Assigned Leases;

Adequate Assurance of Future Performance

            R.         Promptly after any Property Closing Date, (i) the Debtors shall fulfill all
obligations under sections 365(b)(1)(A) and 365(b)(1)(B) of the Bankruptcy Code and (A) cure any undisputed monetary default existing prior to the Property Closing Date with respect to any Lease or any REA (hereafter defined), if applicable, except those monetary
obligations with respect to the period on and after the Closing Date, which obligations shall be the sole obligation of the Designated Rights Purchaser, or (B) establish an escrow for any cure amount in an amount agreed upon between the landlord in respect of such
Lease and the Debtors or as otherwise ordered by the Court, and (ii) the Designees must fulfill all obligations under section 365(f)(2)(B) of the Bankruptcy Code by providing adequate assurance of future performance of the obligations under the Leases, including,
without limitation, through the undertaking of any Designee to perform thereunder and the demonstration of its financial wherewithal, and, to the extent applicable to any Lease, as required by section 365(f)(3) of the Bankruptcy Code.  Under the Designation
Rights Agreement, Designation Rights Purchaser has no obligation to satisfy obligations under section 365(f)(2)(A), 365(b)(1)(b), 365(f)(2)(B) and 365(f)(3).

Validity of the Transfers

            S.         The transfer of the Designation Rights to the Designation Rights Purchaser and any
subsequent transfer, conveyance and assignment of the Properties to the Designees, as the case may be, pursuant to the Designation Rights Agreement, is or will be a legal, valid and effective transfer of the Designation Rights or the Properties, as the case may be,
and vests or will vest the Designation Rights Purchaser or any Designee, as the case may be, with all right, title and interest of the Debtors to the Designation Rights or the Properties (including the Liquor Licenses and the FFE), as the case may be, free and clear
of all of the following (collectively, “Encumbrances”):

            mortgages, security interests, conditional sale or other title retention agreements, pledges, “liens” (as that term is
defined in section 101(37) of the Bankruptcy Code), judgments, demands, charges, encumbrances, options, claims, rights of first refusal, other Liens, and restrictions of all kind (including, without limitation, encumbrances (i) that purport to give to any party a
right or option to effect any forfeiture, modification or termination of the interest of any Debtor or of the Designation Rights Purchaser or any Designee, as the case may be, in the Designation Rights or the Properties or the Premises, the Liquor Licenses, or the
FFE  with respect thereto, as the case may be, or (ii) in respect of taxes accruing, arising or relating to a period prior to the Property Closing Date for a particular Property or the Premises with respect thereto.

            T.         The Designation Rights Purchaser would not have entered into the Designation Rights
Agreement and would not consummate the transaction contemplated thereby, thus materially and adversely affecting the Debtors, their estates and their creditors, if the sale of the Designation Rights to the Designation Rights Purchaser and the sale of the Properties
to the Designees were not free and clear of all Claims (as defined below) against the Debtors or their estates and Encumbrances ( except for the Permitted Exceptions and except as otherwise expressly stated as obligations of the Designation Rights Purchaser, or any
Designees, as the case may be, under the Designation Rights Agreement).

Anti-Assignment Provisions

            U.        Certain of the Properties could be impacted by provisions in the applicable Leases or in
certain reciprocal easement, operating or similar agreements relating to the Properties or the Premises to which the Debtors are a party (“REAs”), as the case may be, that expressly or effectively restrict, prohibit, condition or limit the assignment or
transfer of or the effectiveness of a Lease or Property or use of the Premises, including, without limitation, the following provisions set forth in subparagraph (1) through (9) below (collectively, the “Anti-Assignment Provisions”):

            (1)        any provision of a Lease or an REA that purports to prohibit, condition, limit or otherwise
restrict the assignment or transfer by the Debtors to the Designation Rights Purchaser of the Designation Rights or restrict the assignment to any Designee of the Leases or the Properties;

            (2)        any provision of a Lease or an REA that permits a non-debtor party at any time to increase
payments under (including, without limitation, rent), declare a default with respect to, terminate, modify or cancel any Lease or REA or right or obligation thereunder by reason of (A) the assignment of the Designation Rights to the Designation Rights Purchaser or
any Property to any Designees; (B) the conduct of a store-closing sale at the Premises; (C) the release of the Debtors from liability; (D) the Premises “going dark” for a period of time set forth in the Designation Rights Agreement as may be necessary
either during the Designation Period or to permit any such Designee to remodel, restock, refixture, and/or change signage at such Premises; (E) discontinuation of operations, interruption of business, tenant remodeling restrictions or minimum sales requirements
during the period set forth above; or (F) the Debtor(s) ceasing to be a party to any Lease or REA (clauses (A) – (F), the “Triggering Events”);

            (3)        any provision of a Lease or REA that purports to be “personal” to the Debtors
or to be exercisable only by the Debtors;

            (4)        any provision of a Lease or REA that permits a non-debtor party at any time to exercise a
right of first refusal, purchase options or to recapture possession by reason of any Triggering Event;

            (5)        any provision of a Lease or REA that permits a non-debtor party at any time to require
payment of any fee, profit sharing or other payment by reason of the occurrence of any Triggering Event;

            (6)        any provision of a Lease or REA that permits a non-debtor at any time to impose any penalty
or rental or other monetary adjustment or allocation by reason of the occurrence of any Triggering Event;

            (7)        any provision of a Lease that permits a non-debtor at any time to cancel, modify or
restrict any Designees from exercising any renewal options or purchase options by reason of any Triggering Event;

            (8)        any provision of a Lease or REA that permits a non-debtor party at any time to seek damages
or other relief by reason of a Triggering Event; and

            (9)        any provision of a Lease or REA that purports to prohibit, restrict or condition (A) the
removal of existing signage and the installation of standard signs (subject to applicable municipal codes) displaying the trade name of any Designee; (B) any and all alterations, additions, replacements, or improvements (including, without limitation, the front
fascia of the premises) deemed necessary by such Designees (subject to applicable municipal codes) to renovate, construct, furnish, replace, equip and conform the Premises to a prototypical store of any such Designees; or (C) operation of the Premises under such
Designees’ trade names.

            V.        The Anti-Assignment Provisions would materially diminish the value of the Properties and the
ability to assign and sell such Properties for value (including, without limitation, as contemplated by the Designation Rights Agreement).  The Anti-Assignment Provisions are inconsistent with sections 365(f)(1) and 365(f)(3) of the Bankruptcy Code and the
Congressional policy expressed therein favoring a debtor’s ability to maximize the value of its assets.  A final and binding determination that the Anti-Assignment Provisions are unenforceable was a material and indispensable consideration of the Designation Rights Purchaser’s willingness to enter into the Designation Rights Agreement, is indispensable to marketability of the Properties, and is necessary to maximize the proceeds to be received by the Debtors’
estates.

IT IS HEREBY ORDERED, ADJUDGED AND DECREED THAT:

            1.         The Motion is GRANTED and APPROVED in accordance with the terms of this Order and the
Designation Rights Agreement.  The Debtors’ and the Committee’s actions and decisions in connection with the Auction and the execution of the Designation Rights Agreement are ratified and approved, including (without
limitation) their decision to recommend to the Court the final bid of OS Realty, Inc. as the highest and best offer. OS Realty, Inc. is approved as the Designation Rights Purchaser and shall have full and complete authority to direct the Debtors to transfer the
Properties, including the Leases, the Premises, the FFE, and the Liquor Licenses to itself, to an affiliate, or to another Designee without the payment of further consideration to the Debtors.  The terms of the Designation Rights Agreement are expressly ratified
and approved.

            2.         Without limiting any other rights of the parties under the Designation Rights
Agreement, the Designation Rights Agreement shall be enforceable, at the option of OS Realty, Inc. by motion to compel filed with this Court.

            3.         For the reasons set forth on the record at the Sale Hearing, all objections to the
Motion and the relief requested therein that have not been withdrawn, waived, or settled, and all reservations of rights included in such objections (other than those objections relating solely to (i) issues of adequate assurance of future performance under sections
365(f)(2)(B) and 365(b)(3), if applicable, to the extent not otherwise overruled as constituting unenforceable Anti-Assignment Provisions and (ii) the requirement that all cure obligations of the Debtors have been paid or reserved for by the Debtors, which are
preserved until the filing of a Designee Notice (defined below)), are overruled on the merits.

            4.         The Debtors are authorized and empowered to enter into the Designation Rights
Agreement consistent with this Order and the Auction and to sell, transfer, and convey the Designation Rights to the Designation Rights Purchaser.

            5.         The terms of the Designation Rights Agreement are approved in their entirety, and this
Order and the Designation Rights Agreement shall be binding upon the Debtors, all creditors of the Debtors, and any trustees appointed in these cases or any trustees appointed in any subsequent cases under chapter 7 or chapter 11 of the Bankruptcy Code relating to
the Debtors, and all other parties in interest and their successors and assigns.  The Designation Rights Purchaser shall pay the Purchase Price in accordance with the terms of the Designation Rights Agreement.  OSI has agreed to guaranty the full and prompt
performance of all obligations of OS Realty, Inc. under the Designation Rights Agreement (the “Guaranty”), and hereby is directed to perform all obligations of OS Realty, Inc. under the Designation Rights Agreement, including the payment of the Purchase
Price, within fifteen (15) days from receipt of written demand by Seller (as defined in the Guaranty attached as Exhibit C to the Designation Rights Agreement), which demand states in detail the nature of the alleged default(s) by OS Realty, Inc.  Wells Fargo
Foothill, Inc., a California corporation, as the arranger and administrative agent for the lenders under the Amended and Restated Senior Secured, Super-Priority Debtor-In-Possession Loan and Security Agreement (“Agent”), has a security interest in and
lien upon Sellers’ and Debtors’ rights with respect to the Guaranty, which Guaranty is hereby pledged to Agent.

            6.         Pursuant to sections 105(a) and 363(f) of the Bankruptcy Code and the Designation
Rights Agreement, the Properties (upon the sale or assumption and assignment to Designees as provided herein), shall be transferred to the Designation Rights Purchaser and the Designees, respectively, free and clear of (i) all Encumbrances and (ii) any and all claims
(as that term is defined in section 101(5) of the Bankruptcy Code), obligations, demands, debts, rights, contractual commitments, restrictions, interests and matters of any kind and nature, whether arising prior to or subsequent to the commencement of these chapter
11 cases, and whether imposed by agreement, understanding, law, equity or otherwise (including, without limitation, claims and encumbrances (A) that purport to give to any party a right or option to effect any forfeiture, modification or termination of the interest
of any Debtor or of the Designation Rights Purchaser or its Designee(s), as the case may be, in the Designation Rights or the Properties or the Premises applicable to such Properties) or (B) in respect of any taxes (other than taxes included in Permitted Exceptions)
(collectively, “Claims”), in each case, accruing, arising or relating to the period prior to the Closing with all mortgages, liens and security interests to attach to any amounts payable to the Debtors under the Designation Rights Agreement, with
the same validity, force and effect that they now have as against the Designation Rights or the Properties, subject to any claims and defenses the Debtors and the Debtors’ estates may possess with respect thereto.  Notwithstanding
anything herein to the contrary, the written agreements and settlements of Affected Parties or various landlords (see docket nos. 985-993), on the one hand, and the Debtors, on the other hand, relating to the relief sought in this Order are (a) hereby approved
and (b) shall govern and control to the extent inconsistent with this Order.

            7.         Except as expressly permitted by the Designation Rights Agreement, (i) all persons and
entities holding Encumbrances or Claims of any kind and nature accruing, arising or relating to a period prior to the applicable Property Closing with respect to any Property are hereby barred from asserting such Encumbrances or Claims against the Designation Rights
Purchaser, OSI, or any applicable Designee, as the case may be, or any of their respective affiliates, stockholders, members, partners, parent entities, successors, assigns, officers, directors or employees, agents, representatives, and attorneys, or respective
property, and (ii) the Designation Rights Purchaser, OSI or any Designees for their applicable Properties, as the case may be, shall have no liability or responsibility for any Claim or Encumbrance arising, accruing, or relating to a period prior to the Property
Closing, except as otherwise provided for in the Designation Rights Agreement.

            8.         All Liens due and owing on the Closing Date, including Liens for unpaid real estate
taxes, on the Designation Rights and Properties and will (a) be satisfied through cash payment in full to holders of such Liens or, in the event such Liens are disputed, the establishment of reserve(s) or escrow account(s) in the amount of such Liens, or (b) attach
to any portion of the proceeds of sale of the Designation Rights and Properties which are payable to the Debtors pursuant to the Designation Rights Agreement with the same force, effect and priority as such liens have on the Designation Rights and Properties,
subject, in each case, to the rights and defenses, if any, of the Debtors and any party in interest with respect thereto.  The real estate tax liens for taxes assessed but not yet due and payable will remain on the Properties until paid in full.  To the
extent that the Designation Rights Purchaser pays any undisputed Claims or Taxes (including real estate taxes) related to or arising in periods prior to the Closing Date, the Debtors shall promptly reimburse the Designation Rights Purchaser for such Claims and Taxes,
and the Designation Rights Purchaser shall be fully subrogated to the rights of such parties as to any liens they may have against the Proceeds from Sale.  Notwithstanding anything contained herein to the contrary, any and all Proration Items shall be satisfied
in accordance with Section 10.2 of the Designation Rights Agreement.

            9.         All persons and entities, including, without limitation, all debt security holders,
equity security holders, governmental, tax, and regulatory authorities, lenders, trade and other creditors, holding interests of any kind or nature whatsoever against or in the Debtors, the Designation Rights or Properties (whether legal or equitable, secured or
unsecured, matured or unmatured, contingent or noncontingent, senior or subordinated), arising under or out of, in connection with, or in any way relating to the Debtors, the Designation Rights, the Properties, the operation of the Debtors’ businesses, or the
transfer of the Designation Rights to the Designation Rights Purchaser and the subsequent sale or assumption and assignment of the Properties to the Designees, hereby are (with respect to the Designation Rights), and will be (upon consummation of a sale or assumption
and assignment of a Property to a Designee in accordance with this Order), forever barred, estopped, and permanently enjoined from asserting against the Designation Rights Purchaser, OSI, and the Designees, their successors or assigns, their property, or the
Designation Rights and the Properties, as the case may be, such persons’ or entities’ claims, causes of action or interests.

            10.       The Anti-Assignment Provisions contained in the Leases and REAs shall not restrict, limit, or
prohibit the sale or assumption and assignment of the Properties to or use of the Premises by the Designees; provided, however, that nothing herein shall limit the ability of an Affected Party to object to proposed “cure” or the
“adequate assurance of future performance” of a Designee under a Lease pursuant to section 365 of the Bankruptcy Code.   Further, without limiting the foregoing, notwithstanding any provision in a Lease or REA to the contrary, (a) the Premises will
be allowed to remain “dark” during the Designation Period, or such longer period as provided in a further order of the Court, (b) the Premises sold or assigned to a Designee will be allowed to remain “dark” for up to six (6) months after an
assignment of the Leases and for up to one (1) additional year after a sale of the Real Estate, or such longer period as provided in a further order of the Court, to the extent necessary to enable the Designee to move into, remodel, restock, refixture, renovate,
construct, furnish, replace, equip, conform and use the Premises to a prototypical store of any such Designees; and to change the signage of said Premises and (c) a Designee will be allowed to re-model and make changes and to replace and modify existing signage for
the Designee’s proposed use of the Premises contained in the Designee Notice. 

            11.       Each and every Anti-Assignment Provision is null, void and of no force and effect in connection
with any assignment of the Leases to any Designees pursuant to the Designation Rights Agreement; provided that all issues regarding (i) adequate assurance of future performance with respect to the assumption of a Lease, (ii) cure issues under section 365 of
the Bankruptcy Code, and (iii) whether a Designee qualifies as a good faith purchaser under section 363(m) of the Bankruptcy Code as to a particular Lease shall be fully reserved until the filing of a Designee Notice with respect thereto.6

            12.       The Leases and the REAs shall be transferred to, and remain in full force and effect for the
benefit of, the applicable Designees, in accordance with their respective terms, notwithstanding any provision in any such Lease or any REA (including, without limitation, an Anti-Assignment Provision, or as described in sections 365(b)(2) and (f) of the Bankruptcy
Code) that prohibits, restricts, conditions, or limits such assignment or transfer.

___________________

6           The failure to list any one or more of the Anti-Assignment Provisions herein shall not be construed in any way to affect or
otherwise diminish the Court’s invalidation of all Anti-Assignment Provisions in their entirety in connection with any assignment of the Leases to any Designees pursuant to the Designation Rights Agreement.

            13.       Each non-Debtor party to any Lease or an REA is hereby barred and permanently enjoined from asserting against the
applicable Designee, the Designation Rights Purchaser, and OSI, any default, claim or liability existing, accrued, arising or relating to a period prior to the applicable Property Closing.

            14.       The assigned Leases shall be transferred to, and remain in full force and effect for the benefit
of, the applicable Designees in accordance with their respective terms, notwithstanding any provision in any Lease or any REA (including those described in paragraph V above and sections 365(b)(2) and (f) of the Bankruptcy Code) that expressly or effectively
prohibits, restricts, or conditions such assignment or transfer.

            15.       Pursuant to sections 365(a), (b), (c) and (f) of the Bankruptcy Code, the Debtors are authorized
on or before the Property Closing Date with respect to any Property or, in the case of defaults under the applicable Lease that are the subject of bona fide disputes, within five (5) business days of the effectiveness of a settlement or Final Order of this Court
resolving such disputes, to cure all monetary pre-Closing Date defaults under such Lease to the extent required to be cured pursuant to section 365 of the Bankruptcy Code, solely at the expense of the Debtors.  Pending a determination by either agreement of the
Debtors and the landlord or Final Order of the Bankruptcy Court regarding any disputed amounts required to be cured under section 365 of the Bankruptcy Code in connection with the assumption and assignment of any Lease, the Debtors will escrow with the Debtors’
counsel the disputed amount or such other amount determined by agreement or an order of the Bankruptcy Court.

            16.       Subject to and conditioned upon the occurrence of the Property Closing with respect to any
Property and the procedures set forth in the Designation Rights Agreement, and subject to the other provisions of this Order, the Debtors are hereby authorized in accordance with sections 365(b) and (f) of the Bankruptcy Code to (i) assume and assign to any Designees
the applicable Leases with respect to such applicable Property, with any applicable Designee being responsible only for the post- Closing liabilities under the applicable Leases except as otherwise provided for in the Designation Rights Agreement, this Order and any
written agreement with the Designee, and (ii) execute and deliver to any applicable Designee such assignment documents as may be reasonably necessary to sell, assign and transfer such applicable Lease and Property; provided that, notwithstanding anything in
this Order to the contrary, there shall be no assumption of any such Lease absent simultaneous assignment thereof to the applicable Designee (including the Designation Rights Purchaser if it designates itself).  Except as otherwise provided in the Designation
Rights Agreement, this Order or any written agreement with the Designee, any Designee shall not have any liability for the cure of any defaults existing or accruing, arising, or relating to a period prior to the Closing with respect to such applicable Leases and each
non-Debtor party to an assigned Lease is hereby barred and permanently enjoined from asserting against such applicable Designee any default, claim or liability existing, accrued, arising or relating to a period prior to the Closing with respect to such
Lease.

            17.       All defaults (or in the case of monetary defaults that are the subject of bona fide
disputes, to the extent that the amounts of such defaults are agreed to by the Debtors pursuant to a settlement or otherwise determined by Final Order of the Bankruptcy Court resolving such disputes) of the Debtors under the Leases arising, accruing or relating to a
period prior to the Closing Date for the particular Lease (without giving effect to any acceleration clauses or any default provisions of the kind specified in section 365(b)(2) of the Bankruptcy Code) and required to be cured under section 365 of the Bankruptcy Code
have been or will be promptly cured by the Debtors at or following the Property Closing Date and will be deemed to be cured at the Property Closing with respect to the applicable Designee.  No Designee shall have any liability or obligation with respect to any
defaults relating to the assigned Leases arising, accruing or relating to a period prior to the Closing Date, except to the extent otherwise expressly provided in the Designation Rights Agreement, a written agreement with such Designee or an order of this
Court.

            18.       Upon the Property Closing with respect to a Lease, any and all defaults under such Leases shall
be deemed cured in all respects with regard to the applicable Designee and after the cure amount is paid to the applicable landlord pursuant to section 365(k) of the Bankruptcy Code, the Debtors shall have no liabilities for any claims arising or relating to or
accruing post-Property Closing under such assigned Lease. 

            19.       Within five (5) days of receipt of written notice (a “Designee Notice”) from
the Designation Rights Purchaser to the Debtors as to a proposed sale of Real Estate or an assignment of a Lease to a Designee (which Designee Notice shall (i) state the identity of the Designee, and (ii) set forth or provide documentation or other information from
the Designee with respect to satisfying the requirements of demonstrating adequate assurance of future performance only with respect to the Leases under section 365(f)(2)(B) and, if applicable, section 365(b)(3) of the Bankruptcy Code (as limited by section 365(f) of
the Bankruptcy Code) (collectively, the “Purchaser’s Information”)), the Debtors shall deliver a written notice (the “Affected Parties Notice”) to all Affected Parties with respect to the Property.  The Affected Parties Notice shall
(a) be in form and substance reasonably acceptable to the Designation Rights Purchaser and (b) be consistent with and set forth all of the Purchaser’s Information provided in the Designee Notice.  All Designees shall submit themselves to an expedited
discovery process (including document production) to the extent requested by an Affected Party by agreeing to participate in one or more depositions on two (2) business days’ prior written notice with respect to any issue concerning such Designees’
ability to satisfy the requirements of adequate assurance of future performance under section 365 of the Bankruptcy Code for a Lease and to qualify as a good faith purchaser entitled to the protections under section 363(m) of the Bankruptcy Code.  All Affected
Parties shall likewise submit themselves to such expedited discovery procedures (including document production) with respect to their objection or potential objections with respect to such issues.  Any Affected Party with respect to a particular Property may
raise an objection to the proposed assignment and transfer to a Designee of the Property contemplated in the Affected Party Notice on any one (1) or more of the following grounds: (a) an alleged lack of adequate assurance of future performance with respect to a Lease
related to such assignment under section 365 of the Bankruptcy Code, (b) cure amounts or cure issues, or (c) that the Designee is not a good faith purchaser within the meaning of section 363(m) of the Bankruptcy Code solely with respect to that particular
Property.  Other than the grounds set forth in the prior sentence, no other grounds for objections shall be considered by this Court or may be raised by any such Affected Parties.   If any Affected Party elects to object to the assignment and transfer
of the Property to the Designee on one (1) or more of the permitted grounds as aforesaid, such Affected Party must file with the Court a written objection setting forth the reasons for such objection on or before ten (10) days after delivery to such Affected Party of
the applicable Affected Party Notice (the “Objection Deadline”) and serve such objection so as to be actually received by each of the following parties on or before the Objection Deadline:  (a) the Designation Rights Purchaser and its counsel,
(b) the Debtors and their counsel, (c) the Designee and its counsel, and (d) counsel to the Committee, at the addresses set forth for each such party in the Affected Party Notice. 

            20.       If (a) an Affected Party fails to timely object on one of the permitted grounds for objection as specified herein on or
before the Objection Deadline with respect to a proposed transfer and assignment of a Property or (b) such objection relates only to cure amounts or cure issues, such transfer and assignment shall be deemed binding on such Affected Party and any objection to such
assignment or transfer (other than with respect to cure issues or cure amounts) shall be forever waived, released and barred as of the Objection Deadline, and the requirements of sections 363(m), 365(b), (c) and (f) of the Bankruptcy Code with respect thereto shall
be (and are hereby) deemed satisfied upon consummation of the sale and assignment of such Property and the transfer and assignment of the Property may proceed without any further order of the Court; provided, however, that on or before the applicable Property
Closing Date the Debtors shall either pay any cure amount with respect to the applicable Lease or establish an escrow for any disputed cure in an amount (a) agreed upon between the landlord and the Debtors or (b) if no such agreement has been reached, then in an
amount equal to the full amount of the disputed cure or as otherwise ordered by the Court.  In such event, the Property Closing may take place, without the requirement of any further order of the Court, at any time after the expiration of the Objection Deadline
as and when specified in the Designation Rights Agreement or as otherwise agreed to by the Debtors and the Designation Rights Purchaser.

            21.       Subject to the terms of paragraph 22 of this order, below, if an Affected Party timely files an objection with respect
to a proposed transfer and assignment of a Property on one (1) or more of the specified permitted grounds prior to the Objection Deadline (other than an objection relating to a cure issue or a cure amount), then, unless said objection is consensually resolved with or
withdrawn by the objecting Affected Party, the Court will hold a hearing and rule on said objection.  In such event, the Property Closing will be delayed unless and until either such consensual resolution or withdrawal occurs or the Court enters a Sale
Order.  Upon either such consensual resolution or withdrawal occurring or a Sale Order being entered, the applicable Property Closing shall take place, without any further order of the Court, as and when specified in the Designation Rights Agreement or as
otherwise agreed to by the Debtors and the Designation Rights Purchaser.

            22.       In the event that the Debtors receive a Notice from the Designation Rights Purchaser, pursuant to paragraph 2.4 of the
Designation Rights Agreement, that Designation Rights Purchaser has excluded a Lease, Debtors shall have the right to file a motion to reject the Lease which requires the landlord to file an objection to the rejection motion within 10 days of the date the motion is
filed.  If no objection to the motion is timely filed by the affected landlord, the Lease will be deemed to have been rejected as of the date the motion to reject was filed and the Court will enter an order rejecting such Lease without further hearing.  In
the event the affected landlord objects to the rejection of the Lease, the Court will set a hearing on the motion, and if the motion is granted the Lease will be deemed to be rejected as of the date the motion to reject was served. 

            23.       The Designation Rights Purchaser’s and Debtors’ rights and obligations as to Carrying Costs are as set
forth in the Designation Rights Agreement.

            24.       The implementationof the procedures contained herein with respect to
objections do not change or shift, in any way, the burdens of proof upon the parties at any hearing to resolve any objection as such burdens would otherwise exist with respect to the disputed issues.

            25.       Pursuant to section 363(b) of the Bankruptcy Code, the Debtors and the Designation Rights
Purchaser, as wellas its officers, employees, and agents, are authorized and directed to take any and all actions and/or execute any and all documents as may be necessary or desirable to consummate the transactions contemplated by the
Designation Rights Agreement.  Any actions taken by the Debtors and the Designation Rights Purchaser necessary or desirable to consummate such transactions prior to the entry of this Order are hereby ratified.

            26.       The Designation Rights Agreement and any related agreements, documents, or other instruments may be modified, amended,
or supplemented by the parties thereto, in a writing signed by both parties, and in accordance with the terms thereof, without further order of this Court, provided that any such modification, amendment or supplement does not have a material adverse effect on the
Debtors’ estates.

            27.       The failure specificallyto include any particular provisions of the
Designation Rights Agreement in this Order shall not diminish or impair the effectiveness of such provision, it being the intent of the Court that the Designation Rights Agreement be authorized and approved in its entirety.  To theextent of any conflict or inconsistency between the provisions of this Order and the terms and conditions of the Designation Rights Agreement, as between the Debtors, the Designation Rights Purchaser and the Designees, the Designation Rights Agreement shall
govern and control. 

            28.       No bulk sales lawor any similar law of any state or other jurisdiction
shall apply in any way to any of the transactions under the Designation Rights Agreement.

            29.       The registers or recorders of deeds (or other similar recording agency) in their respective
jurisdictions are herebydirected to accept this Order as sole and sufficient evidence of the transfer of title of the Properties to the applicable Designee, as the case may be, and such agency may rely upon this Order in consummating the
transactions contemplated in the Designation Rights Agreement.

            30.       None of the Designation Rights Purchaser, its Designees, nor OSI as the case may be, is (or shall
be deemed to be) a successor to the Debtors or their estates by reason of any theory of law or equity or as a result of the consummation of the transactions contemplated in the Designation Rights Agreement orotherwise.  None of the
Designation Rights Purchaser, its Designees, or OSI as the case may be, (i) is assuming any collective bargaining agreement, employee pension, welfare or benefit plan or (ii) shall assume or in any way be responsible for any liability or obligation of the Debtors
and/or their estates accruing, arising or relating to a period prior to the Closing, except as otherwise expressly provided in the Designation Rights Agreement.

            31.       The Debtors may filea plan or plans of liquidation or reorganization
consistent with the terms of the Designation Rights Agreement.  Nothing contained in any Plan or order entered in (i) these chapter 11 cases, (ii) any subsequent chapter 7 case into which any such chapter 11 case may be converted, or
(iii) any related proceeding subsequent to entry of this Order, shall conflict with or derogate from the provisions of the Designation Rights Agreement or the terms of this Order.   To the extent any provisions of this Order conflict with the terms and
conditions of the Designation Rights Agreement, as between the Debtors and the Designation Rights Purchaser, or the Designees, as the case may be, the Designation Rights Agreement shall govern and control.

            32.       The Court shall retain exclusive jurisdiction to resolve any dispute arising from or relating to the Designation Rights
Agreement or this Order, issue any order in furtherance of the transactions, and hear and resolve any issue relating to any subsequent sale or assignment to a Designee and to determine all issues between Debtors and the Designation Rights Purchaser related to the
Designation Rights Agreement.

            33.       Notwithstanding anything in this Order to the contrary, any provision of any Lease or REA which is deemed or determined
to be unenforceable as an Anti-Assignment Provision or otherwise, and all “go dark” relief and related relief approved herein,7 shall only apply to the initial transfer of the Properties from the Debtors to the Designation Rights Purchaser or
any other Designee, as applicable, and to actions they take as tenants or owners of the Properties, and shall not apply prospectively to subsequent assignments or transfers and to actions that the subsequent transferors or assignees may take upon becoming owners or
tenants of the Properties.

            34.       The transactions contemplated by the Designation Rights Agreement are undertaken by the Designation
Rights Purchaser or its Designees (absent an objection sustained by the Court), as the case may be, in good faith (as that term is used in section 363(m) of the Bankruptcy Code), and the DesignationRights Purchaser and its Designees (absent
an objection sustained by the Court), as the case may be, shall continue to be in good faith (as that term is used in section 363(m) of the Bankruptcy Code) by proceeding to close the transactions contemplated by the Designation Rights Agreement.  Accordingly,
the reversal or modification on appeal of the authorization to consummate the Designation Rights Agreement and the transactions approved hereby shall not affect the validity and enforceability of such transactions, unless such authorization is duly stayed pending
such appeal.  The Designation Rights Purchaser

___________________

7           The failure to list any one or more of the Anti-Assignment Provisions herein shall not be construed in any way to affect or
otherwise diminish the Court’s invalidation of all Anti-Assignment Provisions in their entirety in connection with any assignment of the Leases to any Designees pursuant to the Designation Rights Agreement.

  is a good faith and bona fide purchaser for value of the Designation Rights and is entitled to all of the protections afforded by section 363(m) of the Bankruptcy Code and as a holder in due course. 
Each and every entity is enjoined from commencing or continuing an action seeking relief under section 363(n) of the Bankruptcy Code with respect to the Designation Rights Purchaser.

            35.       If at any time the Debtors no longer have any employees, including employees of Prandium, Inc. who
are responsible for the Debtors’ operations, or at any time that the Designation Rights Purchaser reasonably determines that a Property Closing will not occur as a result of the Debtors’ unavailability, then in such events, the Designation Rights
Purchaser is hereby deemed to be appointed as the Debtors’ attorney in fact and agent in accordance with Section 12.24 of the Designation Rights Agreement.

            36.       To the extent that the Escrowed Proceeds are not sufficient to satisfy in full the items set forth in Section 2.5(b) of
the Designation Rights Agreement, with the exception of the escrow established pursuant to Section 2.5(b)(ii)D), the Designation Rights Purchaser is hereby granted an allowed claim under Section 364 of the Bankruptcy Code with administrative priority over any and all
other costs and administrative expenses, including, without limitation, the kind specified in Sections 105, 326, 330, 331, 503(b), 506, 507(a), 507(b) and 726 of the Bankruptcy code (the “Allowed Administrative Claim”).  Further, the Designation
Rights Purchaser’s ability to recover on account of its Allowed Administrative Claim shall not be adversely affected by Section 365(k) of the Bankruptcy Code which has been waived by the Debtors pursuant to the Designation Rights Agreement and which waiver is
hereby approved in its entirety.

            37.       Pursuant to Section 2.6(b) of the Designation Rights Agreement, the Designation Rights Purchaser shall pay the Carrying
Costs to the Debtors via wire transfer to a separate bank account established by the Debtors for the sole purpose of paying Carrying Costs under the Designation Rights Agreement.  The monies deposited by the Designation Rights Purchaser into the separate bank
account are impressed with a trust in favor of the Designation Rights Purchaser and shall not to be property of the Debtors or the Debtors’ estates.  The Debtors are hereby directed to segregate the funds deposited by the Designation Rights Purchaser into
this bank account and to use such deposited funds solely for the purpose of paying Carrying Costs pursuant to the Designation Rights Agreement.

            38.       The Debtors’ right to assume or reject any Leases pursuant to the Designation Rights Agreement is hereby further
extended as to any Lease designated by Designation Rights Purchaser prior to the Extension Period for an additional ninety (90) days from the last day of the Extension Period in order to permit such Lease designation to be finalized.

            39.       Pursuant to the Designation Rights Agreement, the Debtors are hereby authorized and directed to file and prosecute a
declaratory relief action in form satisfactory to the Designation Rights Purchaser to determine the rights of the Debtor, CC 9, the Designation Rights Purchaser, and any Designee to the Sale-Leaseback Properties.  The Designation Rights Purchaser shall have
standing in any such declaratory relief action commenced by the Debtors with respect to the Sale-Leaseback Properties.

Date:  August ____, 2004

_____________________________

Honorable Charles G. Case, II

United States Bankruptcy Judge

EXHIBIT C

FORM OF GUARANTY

GUARANTY

GUARANTY, made as of  ___________, 2004 (herein together with all amendments and supplements hereof or hereto from time to time, the "Guaranty"), by OUTBACK STEAKHOUSE, INC, a Delaware corporation
(the "Guarantor") to CHI-CHI’S, INC., a Delaware corporation ("Seller").

WHEREAS, Seller filed a voluntary petition for relief under Chapter 11 of the Bankruptcy Code on October 8, 2003.

WHEREAS, Seller and OS REALTY, INC., an affiliate of the Guarantor ("Purchaser"), have entered into a certain Designation Rights Agreement dated as of July 23, 2004 (as amended, the "Agreement").

WHEREAS, to provide assurance of future payment and performance to Seller under the Agreement, Seller has requested that this Guaranty be executed and delivered, and the Guarantor is willing to do so on the terms set forth
below.

NOW, THEREFORE, in consideration of the premises and other good and valuable consideration the Guarantor agrees with Seller as follows:

1.         Capitalized terms not defined herein shall have the meaning set forth in the Agreement.

2.         The Guarantor absolutely and irrevocably guarantees the full and prompt performance of all obligations of Purchaser under the Agreement, including the payment of the Purchase
Price as required pursuant to the Agreement (collectively, the “Obligations”) without setoff or deduction for any purpose, subject only to the performance by Seller of Seller’s obligations under the Agreement.

3.         The Guarantor hereby agrees that (i) the obligations of the Guarantor hereunder are independent of and in addition to the undertakings of Purchaser pursuant to the Agreement,
(ii) a separate action may be brought to enforce the provisions hereof, (iii) Seller may at any time, or from time to time, and without impairing the liability of the Guarantor for the Obligations: extend or change the time of payment and/or performance and/or the
manner, place or terms of payment and/or performance of all or any of the Obligations.

4.         No failure on the part of Seller to exercise and no delay in exercising any right or remedy hereunder shall operate as a waiver thereof; nor shall Seller be estopped to
exercise any such right or remedy at any future time because of any such failure or delay; nor shall any single or partial exercise of any right or remedy hereunder preclude any other or further exercise thereof or the exercise of any other right or remedy.  The
remedies herein provided are cumulative and not exclusive of any remedies provided by law.

5.         The Guarantor assumes the responsibility for keeping informed of the financial condition of Purchaser and of all other circumstances bearing upon the risk of nonpayment or
nonperformance of the Obligations, and agrees that Seller shall have no duty to advise the Guarantor of any information known to Seller regarding any such financial condition or circumstances.

6.         In the event that the Guarantor should breach or fail to timely perform any provisions of this Guaranty, the Guarantor shall pay Seller all costs and expenses (including,
without limitation, reasonable attorneys’ fees and costs) incurred by Seller in the enforcement hereof or the preservation of Seller’s rights hereunder.

7.         Notice of acceptance of this Guaranty and notice of any obligations or liabilities contracted for or incurred by Purchaser are hereby waived by the Guarantor.

8.         This Guaranty may not be modified or amended except by a written agreement duly executed by the Guarantor and Seller.

9.         This Guaranty shall be construed, interpreted and the rights of the Guarantor and of Seller determined in accordance with the laws of the State of Delaware without regard to
conflicts of laws principles thereof, except with respect to matters of law concerning the internal corporate affairs of any corporation, limited partnership or limited liability company which is a party to or the subject of this Guaranty, and as to those matters the
law of the jurisdiction of incorporation or organization of such entity shall govern.  In the event of any litigation concerning this Guaranty, proper venue shall be the Bankruptcy Court and the Guarantor and Seller consent to such jurisdiction.

10.       The Guarantor hereby agrees to waive any trial by jury relating to this Guaranty.

11.       This Guaranty shall inure to the benefit of Seller, its successor and assigns and shall be binding upon the successors and assigns of the Guarantor.

12.       Seller shall have the right to demand performance or payment from the Guarantor of the Guarantor’s obligations under this Guaranty by making written demand to the Guarantor,
stating in detail the nature of the alleged default(s) by Purchaser under the Agreement, and the Guarantor shall then have fifteen (15) days from receipt of such demand to cure the specified default(s) by Purchaser under the Agreement.

13.       All notices and other communications to the Guarantor pursuant to this Guaranty shall be sent in writing to the Guarantor at the address for the delivery of notices to Purchaser pursuant
to the Agreement.  All notices and other communications to Seller pursuant to this Guaranty shall be sent in writing to Seller at the address for the delivery of notices to Seller pursuant to the Agreement.

14.       The Guarantor represents and warrants to Seller that it has the corporate or limited power and authority to execute and deliver this Guaranty, and that upon delivery, such Guaranty shall
be a legal, valid and binding obligation of the Guarantor.

IN WITNESS WHEREOF, the Guarantor has caused this Guaranty to be duly executed as of the date first above written.

GUARANTOR:

Outback Steakhouse, Inc, a Delaware corporation

By: 
                                                                            

 Carl W. Sahlsten

Vice Pres. Of Real Estate and Development

 

 

 

 

SCHEDULE A

FEE PROPERTIES

	
Unit ID

	
Address

	
City

	
State

	
CHI0078

	
7720 Old Trails Road

	
Indianapolis

	
IN

	
CHI0058

	
4837 Bay Road

	
Saginaw

	
MI

	
CHI0054

	
2455 Brice Road

	
Columbus

	
OH

	
CHI0071

	
1320 Boardman Poland Road

	
Youngstown

	
OH

	
CHI0413

	
4434 Scatterfield Road

	
Anderson

	
IN

	
CHI0025

	
3776 South State Street

	
Ann Arbor

	
MI

	
CHI0023

	
2408 Austin Parkway

	
Flint

	
MI

	
CHI0019

	
5609 West Main Street

	
Kalamazoo

	
MI

	
CHI0016

	
4880 Marsh Road

	
Okemos

	
MI

	
CHI0423

	
4495 24th Avenue

	
Port Huron

	
MI

	
CHI0005

	
13905 Lakeside Circle

	
Sterling Heights

	
MI

	
CHI0010

	
4000 West Market Street

	
Akron

	
OH

	
CHI0022

	
5075 Dressler Road NW

	
Canton

	
OH

	
CHI0398

	
2794 Colonel Glenn Highway

	
Fairborn

	
OH

	
CHI0407

	
1421 River Valley Blvd.

	
Lancaster

	
OH

	
CHI0392

	
2284 West 4th Street

	
Mansfield

	
OH

	
CHI0077

	
830 East Pittsburg Street

	
Greensburg

	
PA

	
CHI0416

	
599 Franklin Mills Circle

	
Philadelphia

	
PA

	
CHI0050

	
750 Middletown Boulevard

	
Langhorne

	
PA

	
CHI0454

	
18365 West Bluemound Road

	
Brookfield

	
WI

	
CHI0452

	
9396 U.S. Hwy. 16

	
Onalaska

	
WI

	
CHI0352

	
14980 Dix Toledo Highway

	
Southgate

	
MI

	
CHI0426

	
3101 East State Street

	
Hermitage

	
PA

GROUND LEASES

	
Unit ID

	
Address

	
Location

	
CHI0048

	
867 US-31 North

	
Greenwood - Indy, IN

	
CHI0033

	
2550 East Third Street

	
Bloomington, IN

	
CHI0045

	
739 Lynn Haven Parkway

	
Virginia Beach, VA

	
CHI0429

	
6640 Eastman Road

	
Midland, MI

	
CHI0088

	
3830 South US Hwy 41

	
Terre Haute, IN

	
CHI0409

	
120 North Pottstown Pike

	
Exton, PA

	
CHI0391

	
Braddock Square

	
Cumberland, MD

	
CHI0079

	
316 New Castle Road

	
Butler, PA

	
CHI0027

	
625 Route 1 at Gill Lane

	
Woodbridge, NJ

	
CHI0331

	
5800 Peach Street

	
Erie, PA

	
CHI0026

	
335 Highway Route 18

	
East Brunswick, NJ

	
CHI0310

	
2575 Maryland Road

	
Willow Grove, PA

	
CHI0421

	
2883 South Oneida Street

	
Green Bay, WI

	
CHI0330

	
6410 Coventry Way

	
Clinton, MD

	
CHI0422

	
3001 North Lexington Drive

	
Janesville, WI

	
CHI0305

	
1304 West Patrick Street

	
Frederick, MD

	
CHI0348

	
955 Riverside Street

	
W. Springfield, MA

	
CHI0300

	
1770 Brittain Road

	
Akron, OH

	
CHI0466-1

	
7717 Nicollet Avenue South

	
Richfield, MN

	
CHI0323

	
1085 Woodland Road

	
Reading, PA

	
CHI0459

	
5200 Durand Avenue

	
Racine, WI

	
CHI0417

	
1616 East Wooster Street

	
Bowling Green, OH

	
CHI0031

	
1598 Washington Road

	
Pittsburgh, PA

SCHEDULE A-1

SALE-LEASEBACK PROPERTIES

	
Unit ID

	
Address

	
City

	
State

	
CHI0085

	
40 Geoffrey Drive

	
Newark

	
DE

	
CHI0098

	
3430 State Road 26

	
Lafayette

	
IN

	
CHI0304

	
11570 Eleven Mile Road

	
Warren

	
MI

	
CHI0096

	
5924 W Saginaw Highway

	
West Lansing

	
MI

	
CHI0073

	
6150 Rockside Place

	
Independence

	
OH

	
CHI0313

	
7834 Reynolds Road

	
Mentor-Cleveland

	
OH

	
CHI0319

	
1405 Kenneth Road

	
York

	
PA

	
CHI0092

	
1101 Seminole Trail

	
Charlottesville

	
VA

	
CHI7072

	
4415 N. Rockwood Road

	
Peoria

	
IL

	
CHI7082

	
2151 Wabash Avenue

	
Springfield

	
IL

	
CHI0093

	
1705 W. McGalliard Road

	
Muncie

	
IN

	
CHI0089

	
7901 Mall Road

	
Florence

	
KY

	
CHI0327

	
1566 Reynolds Road

	
Maumee-Toledo

	
OH

	
CHI0320

	
5789 Mines Road

	
Niles

	
OH

	
CHI0074

	
7201 McKnight Road

	
Pittsburgh

	
PA

SCHEDULE B

BUILDING & LAND LEASES

	
Unit ID

	
Address

	
Location

	
CHI0099

	
1709 Deptford Center Road

	
Deptford, NJ

	
CHI0400

	
Roxbury Mall

	
Roxbury, NJ

	
CHI0312

	
214 Reynolds Road

	
Binghamton, NY

	
CHI0044

	
500 Clairton Boulevard

	
Pittsburgh, PA

	
CHI0084

	
8030 Governor Ritchie Hwy.

	
Pasadena, MD

	
CHI0432

	
700 Plaza Drive

	
Secaucus, NJ

	
CHI0455

	
5300 South 76th Street

	
Greendale, WI

	
CHI0013

	
9559 West 151st Street

	
Orland Park, IL

	
CHI0458

	
5005 South 74th Street

	
Southridge, WI

	
CHI0462

	
600 East Superior Street

	
Duluth, MN

	
CHI0415

	
600 Beaver Valley Mall

	
Monaca, PA

	
CHI0001

	
6110 East 82nd Street

	
Indianapolis, IN

	
CHI0453

	
414 Grand Canyon Drive

	
Madison, WI

	
CHI0451

	
1030 Clairemont Avenue

	
Eau Claire, WI

	
CHI0097

	
4357 Westland Mall

	
Columbus, OH

SCHEDULE 7.4

July 1, 2004

Dear Resident,

This letter is to inform you of an important construction project that will be beginning soon. The Abbayville Road Construction and North Highland Road Realignment project is {scheduled to begin the week of July 12,2004. A new
section of Abbeyville Road is to be constructed between the two properties occupied by the former Red Lobster and Chi Chi's Restaurants.

The project will be constructed in two phases. The first phase will include constructing the new Abbeyville Road Connector. The new road will extend from the signalized intersection with Route 19 and Abbeyville Road to North
Highland Road. There will be work performed at the intersection of North Highland Road that will involve some lane closures, Access on North Highland Drive will be provided during Phase 1, although you may experience some delays that are unavoidable in this type of
construction project.

The second phase will include the reconstruction of North Highland Drive from Route 19 to Patton Drive. During this phase traffic will now be routed from Route 19 onto the new Abbeyville Connector to North Highland Road. The
estimated project completion date is November 15,2004.

If you should have any questions or concerns during this project, please feel true to contact me at 412.831.9000 ext. 275. Your patience and understanding during construction will be greatly appreciated.

Sincerely,

DanFlatz

Public Improvements Inspector

1820 McLaughlin Run Road        Upper St. Clair, PA 15241-2332     412.831.900O      Fax
412.854.5330

Irving S. Firman 412.594.5557

                                                                                                
               ifirman@tuckerlaw.com

VIA HAND DELIVERY

June 7, 2004

Joseph D, Talarico, Esq.

 Talarico, Paladino & Berg

2150 Koppers Building

436 Seventh Avenue

Pittsburgh, PA 15219

Re: Township of Upper St. Clair v. Palombo

 GD No. 04-1536

Taking of a portion of 319-H-90

Dear Mr. Talarico:

As you aware, the Township of Upper St, Clair has a taken a portion of ':he property identified as lot and block 319-H-90 owned without encumbrances by Dominic Palombo, Lita McGill Palombo and Richard Palombo.
The Declaration of Taking was filed with the court on January 22,2004.

The Township of Upper St. Clair has obtained an appraisal on the portion of the property taken by Eminent Domain and had reached the opinion that tha fair market value of the property taken is Seventy-six
thousand, seven hundred and twenty-three ($76,723.00) dollars.

Pursuant to 26 P.S. §1-407, enclosed is a check made payable to Dominic Palombo, Lita McGill Palombo and Richard Palombo as owners of the property in the amount of $76,723.00 as payment of the Condemnor's
Estimate of Just Compensation for theproperty taken. If you have any questions or would like to discuss this matter further, please do not hesitate to contact me.

Very truly yours,

TUCKER ARENSBERG, P.C.

Irving S. Firman

ISF:

cc:        Douglas Watkins, Manager

Matthew Serakowski, Director of Community Development

Charles P. McCullough, Esquire

LIT:326281-1 016294-116383

Tucker Arensbarg, P.C. 1500 One PPG Place Pittsburgh, PA 15222 p.412.566.1212 f. 412.594.5619 www.tuckerlaw.com

SCHEDULE 11.2

	
Chi-Chi's, Inc.

	
Schedule of Estimated Cure Amounts Owed for Leases and Real Estate

													
				
Estimated Cure Amount as of August 31, 2004

			
		
Properties

	
Rent

		
CAM

		
Taxes

		
Contingency

		
Total

													
	
1

	
Unit 0001

	
$

	
10,833.33

	
$

	
-

	
$

	
24,137.68

	
$

	
2,985.87

	
$

	
37,956.89

	
2

	
Unit 0005

		
-

		
353.42

		
20,710.59

		
2,985.87

		
24,049.88

	
3

	
Unit 0010

		
-

		
-

		
17,235.85

		
2,985.87

		
20,221.72

	
4

	
Unit 0013

		
17,000.00

		
-

		
95,148.73

		
2,985.87

		
115,134.61

	
5

	
Unit 0016

		
-

		
-

		
17,376.46

		
2,985.87

		
20,362.33

	
6

	
Unit 0019

		
-

		
-

		
3,671.29

		
2,985.87

		
6,657.16

	
7

	
Unit 0022

		
-

		
-

		
12,979.74

		
2,985.87

		
15,965.61

	
8

	
Unit 0023

		
-

		
-

		
29,970.72

		
2,985.87

		
32,956.59

	
9

	
Unit 0025

		
-

		
-

		
21,539.00

		
2,985.87

		
24,524.87

	
10

	
Unit 0026

		
7,500.00

		
8,896.18

		
17,834.70

		
2,985.87

		
37,216.75

	
11

	
Unit 0027

		
10,490.08

		
1,304.00

		
-

		
2,985.87

		
14,779.95

	
12

	
Unit 0031

		
2,425.50

		
-

		
17,099.30

		
2,985.87

		
22,510.67

	
13

	
Unit 0033

		
6,333.33

		
1,009.48

		
12,378.57

		
2,985.87

		
22,707.26

	
14

	
Unit 0044

		
22,742.13

			
-

		
29,465.22

		
2,985.87

		
55,193.22

	
15

	
Unit 0045

		
4,333.33

		
725.67

		
15,735.73

		
2,985.87

		
23,780.60

	
16

	
Unit 0048

		
2,666.67

		
640.00

		
18,368.41

		
2,985.87

		
24,660.95

	
17

	
Unit 0050

		
-

		
148.50

		
36,089.62

		
2,985.87

		
39,223.99

	
18

	
Unit 0054

		
-

			
-

		
21,872.48

		
2,985.87

		
24,858.36

	
19

	
Unit 0058

		
-

			
-

		
24,501.27

		
2,985.87

		
27,487.14

	
20

	
Unit 0071

		
-

			
-

		
17,311.29

		
2,985.87

		
20,297.16

	
21

	
Unit 7072

		
-

			
-

		
45,788.51

		
2,985.87

		
48,774.38

	
22

	
Unit 0073

		
-

			
-

		
27,333.70

		
2,985.87

		
30,319.57

	
23

	
Unit 0074

		
-

			
-

		
25,474.52

		
2,985.87

		
28,460.39

	
24

	
Unit 0077

		
-

			
-

		
13,325.58

		
2,985.87

		
16,311.45

	
25

	
Unit 0078

		
-

			
-

		
30,760.96

		
2,985.87

		
33,746.83

	
26

	
Unit 0079

		
1,653.08

		
198.50

		
-

		
2,985.87

		
4,837.45

	
27

	
Unit 7082

		
-

			
-

		
23,702.81

		
2,985.87

		
26,688.68

	
28

	
Unit 0084

		
14,756.00

		
16,974.34

		
64,826.35

		
2,985.87

		
99,542.57

	
29

	
Unit 0085

		
-

		
4,037.75

		
3,935.59

		
2,985.87

		
10,959.21

	
30

	
Unit 0088

		
2,750.00

		
624.58

		
24,976.39

		
2,985.87

		
31,336.84

				
                                                                                         

				
				
Draft and Subject to Change

				
				
8/27/2004, 12:47 PM

				
				
1 of 3

				

			
Estimated Cure Amount as of August 31, 2004

			
		
Properties

	
Rent

	
CAM

	
Taxes

	
Contingency

	
Total

									
	
31

	
Unit 0089

		
-

		
-

	
16,133.96

	
2,985.87

	
19,119.83

	
32

	
Unit 0092

		
-

		
-

	
3,133.69

	
2,985.87

	
6,119.56

	
33

	
Unit 0093

		
-

		
-

	
23,825.65

	
2,985.87

	
26,811.52

	
34

	
Unit 0096

		
-

		
-

	
19,878.59

	
2,985.87

	
22,864.47

	
35

	
Unit 0097

	
6,987.50

	
5,175.60

	
1,998.98

	
2,985.87

	
17,147.95

	
36

	
Unit 0098

		
-

		
-

	
22,096.40

	
2,985.87

	
25,082.27

	
37

	
Unit 0099

	
10,481.63

		
-

	
-

	
2,985.87

	
13,467.50

	
38

	
Unit 0300

	
5,416.70

		
-

	
36,664.03

	
2,985.87

	
45,066.60

	
39

	
Unit 0304

		
-

		
-

	
20,201.92

	
2,985.87

	
23,187.79

	
40

	
Unit 0305

	
9,400.00

		
-

	
3,797.98

	
2,985.87

	
16,183.85

	
41

	
Unit 0310

	
6,166.67

		
-

	
19,834.79

	
2,985.87

	
28,987.34

	
42

	
Unit 0312

	
8,000.00

		
-

	
3,512.21

	
2,985.87

	
14,498.09

	
43

	
Unit 0313

		
-

		
-

	
23,489.21

	
2,985.87

	
26,475.08

	
44

	
Unit 0319

		
-

		
-

	
2,830.94

	
2,985.87

	
5,816.81

	
45

	
Unit 0320

		
-

		
-

	
10,392.59

	
2,985.87

	
13,378.46

	
46

	
Unit 0323

	
5,823.12

		
-

	
288.78

	
2,985.87

	
9,097.77

	
47

	
Unit 0327

		
-

		
-

	
18,621.93

	
2,985.87

	
21,607.80

	
48

	
Unit 0330

	
6,666.67

		
-

	
2,652.28

	
2,985.87

	
12,304.82

	
49

	
Unit 0331

	
3,833.34

		
-

	
1,373.00

	
2,985.87

	
8,192.21

	
50

	
Unit 0348

	
4,991.25

	
2,455.56

	
13,807.12

	
2,985.87

	
24,239.80

	
51

	
Unit 0352

		
-

		
-

	
-

	
2,985.87

	
2,985.87

	
52

	
Unit 0391

	
3,166.67

	
835.62

	
341.67

	
2,985.87

	
7,329.84

	
53

	
Unit 0392

		
-

		
-

	
10,437.58

	
2,985.87

	
13,423.45

	
54

	
Unit 0398

		
-

		
-

	
9,216.57

	
2,985.87

	
12,202.45

	
55

	
Unit 0400

	
14,333.33

	
7,278.11

	
2,114.61

	
2,985.87

	
26,711.92

	
56

	
Unit 0407

		
-

		
-

	
8,973.21

	
2,985.87

	
11,959.08

	
57

	
Unit 0409

	
4,166.67

		
-

	
-

	
2,985.87

	
7,152.54

	
58

	
Unit 0413

		
-

	
2,366.33

	
12,698.52

	
2,985.87

	
18,050.72

	
59

	
Unit 0415

	
8,091.67

	
1,427.91

	
947.40

	
2,985.87

	
13,452.85

	
60

	
Unit 0416

		
-

	
120.98

	
-

	
2,985.87

	
3,106.85

			
                                                                                                                                                          

	
			
Draft and Subject to Change

	
			
8/27/2004, 12:47 PM

	
			
2 of 3

	

			
Estimated Cure Amount as of August 31, 2004

												
		
Properties

	
Rent

	
CAM

		
Taxes

		
Contingency

		
Total

												
	
61

	
Unit 0417

		
2,371.88

		
200.19

		
889.86

		
2,985.87

		
6,447.80

	
62

	
Unit 0421

		
11,091.67

		
-

		
18,154.71

		
2,985.87

		
32,232.25

	
63

	
Unit 0422

		
11,091.67

		
-

		
14,800.24

		
2,985.87

		
28,877.78

	
64

	
Unit 0423

		
-

		
-

		
18,201.18

		
2,985.87

		
21,187.05

	
65

	
Unit 0426

		
-

		
-

		
12,108.06

		
2,985.87

		
15,093.93

	
66

	
Unit 0429

		
2,587.50

		
558.68

		
11,837.36

		
2,985.87

		
17,969.41

	
67

	
Unit 0432

		
20,370.17

		
13,572.17

		
2,900.33

		
2,985.87

		
39,828.54

	
68

	
Unit 0451

		
11,355.00

		
-

		
19,411.58

		
2,985.87

		
33,752.45

	
69

	
Unit 0452

		
-

		
-

		
10,464.36

		
2,985.87

		
13,450.23

	
70

	
Unit 0453

		
12,498.20

		
-

		
22,323.51

		
2,985.87

		
37,807.59

	
71

	
Unit 0454

		
-

		
-

		
30,274.06

		
2,985.87

		
33,259.94

	
72

	
Unit 0455

		
5,000.00

		
2,635.36

		
1,200.91

		
2,985.87

		
11,822.14

	
73

	
Unit 0458

		
16,270.03

		
-

		
27,814.83

		
2,985.87

		
47,070.73

	
74

	
Unit 0459

		
3,500.00

		
845.80

		
20,339.12

		
2,985.87

		
27,670.79

	
75

	
Unit 0462

		
15,757.12

		
288.94

		
-

		
2,985.87

		
19,031.93

	
76

	
Unit 0466

		
12,800.00

		
-

		
11,163.32

		
2,985.87

		
26,949.20

			
$

	
325,701.91

	
$

	
72,673.67

	
$

	
1,224,698.06

	
$

	
226,926.36

	
$

	
1,850,000.00

			
                                                                                                                                                               

		
			
Draft and Subject to Change

		
			
8/27/2004, 12:47 PM

		
			
3 of 3

		

SCHEDULE 12.26

	

 				
ROBINSON BRIDGE NOTE

			
8/27/200412:47 PM

	
 

											
 

			
(1)

	
(2)

	
(3)

	
(4)

	
(5)

	
(6)

	
(7)

	
(8)

	
 

											
 

				
Total

	
Total

	
12.0%

				
Cumulative

	
 

				
Interest

	
Principal plus

	
Current Month

		
Payment Application

	
Principal

	
 

			
Principal

	
Due

	
Interest Due

	
Interest

	
Payment

	
Interest

	
Principal

	
Reductions

	
 

							
(input)

				
 

	
(1) Dec

	
1985

	
2,900,000.00

	
20,021.92

	
2,920,021.92

	
20,021.92

					
 

	
(2) Jan

	
1986

	
2,900,000.00

	
49,578.08

	
2,949,578.08

	
29,556.16

	
0.00

	
0.00

	
0.00

	
0.00

	
 

	
(3) Feb

		
2,900,000.00

	
0.38

	
2,900,000.38

	
27,649.32

	
77,227.02

	
77,227.02

	
0.00

	
0.00

	
 

	
(4) Mar

		
2,900,000.00

	
0.52

	
2,900,000.52

	
29,556.16

	
29,556.02

	
29,556.02

	
0.00

	
0.00

	
 

	
(5) Apr

		
2,900,000.00

	
0.52

	
2,900,000.52

	
28,602.74

	
28,602.74

	
28,602.74

	
0.00

	
0.00

	
 

	
(6) May

		
2,840,500.00

	
0.52

	
2,840,500.52

	
29,556.16

	
89,056.16

	
29,556.16

	
59,500.00

	
59,500.00

	
 

	
(7) Jun

		
2,840,500.00

	
0.52

	
2,840,500.52

	
28,015.89

	
28,015.89

	
28,015.89

	
0.00

	
59,500.00

	
 

	
(8) Jul

		
2,840,500.00

	
0.52

	
2,840,500.52

	
28,949.75

	
28,949.75

	
28,949.75

	
0.00

	
59,500.00

	
 

	
(9) Aug

		
2,840,500.00

	
0.52

	
2,840,500.52

	
28,949.75

	
28,949.75

	
28,949.75

	
0.00

	
59,500.00

	
 

	
(10) Sept

		
2,840,500.00

	
0.52

	
2,840,500.52

	
28,015.89

	
28,015.89

	
28,015.89

	
0.00

	
59,500.00

	
 

	
(11) Oct

		
2,840,500.00

	
0.52

	
2,840,500.52

	
28,949.75

	
28,949.75

	
28,949.75

	
0.00

	
59,500.00

	
 

	
(12) Nov

		
2,840,500.00

	
0.52

	
2,840,500.52

	
28,015.89

	
28,015.89

	
28,015.89

	
0.00

	
59,500.00

	
 

	
(13) Dec

		
2,840,500.00

	
0.52

	
2,840,500.52

	
28,949.75

	
28,949.75

	
28,949.75

	
0.00

	
59,500.00

	
 

	
(14) Jan

	
1987

	
2,840,500.00

	
0.52

	
2,840,500.52

	
28,949.75

	
28,949.75

	
28,949.75

	
0.00

	
59,500.00

	
 

	
(15) Feb

		
2,840,500.00

	
0.52

	
2,840,500.52

	
26,148.16

	
26,148.16

	
26,148.16

	
0.00

	
59,500.00

	
 

	
(16) Mar

		
2,840,500.00

	
0.52

	
2,840,500.52

	
28,949.75

	
28,949.75

	
28,949.75

	
0.00

	
59,500.00

	
 

	
(17) Apr

		
2,840,500.00

	
0.52

	
2,840,500.52

	
28,015.89

	
28,015.89

	
28,015.89

	
0.00

	
59,500.00

	
 

	
(18) May

		
2,840,500.00

	
0.52

	
2,840,500.52

	
28,949.75

	
28,949.75

	
28,949.75

	
0.00

	
59,500.00

	
 

	
(19) Jun

		
2,839,913.81

	
0.00

	
2,839,913.81

	
28,015.89

	
28,602.60

	
28,016.41

	
586.19

	
60,086.19

	
 

	
(20) Jul

		
2,839,907.84

	
0.00

	
2,839,907.84

	
28,943.78

	
28,949.75

	
28,943.78

	
5.97

	
60,092.16

	
 

	
(21) Aug

		
2,839,901.81

	
0.00

	
2,839,901.81

	
28,943.72

	
28,949.75

	
28,943.72

	
6.03

	
60,098.19

	
 

	
(22) Sept

		
2,839,309.20

	
0.00

	
2,839,309.20

	
28,009.99

	
28,602.60

	
28,009.99

	
592.61

	
60,690.80

	
 

	
(23) Oct

		
2,839,297.07

	
0.00

	
2,839,297.07

	
28,937.62

	
28,949.75

	
28,937.62

	
12.13

	
60,702.93

	
 

	
(24) Nov

		
2,839,285.21

	
0.00

	
2,839,285.21

	
28,004.03

	
28,015.89

	
28,004.03

	
11.86

	
60,714.79

	
 

	
(25) Dec

		
2,839,272.83

	
0.00

	
2,839,272.83

	
28,937.37

	
28,949.75

	
28,937.37

	
12.38

	
60,727.17

	
 

	
(26) Jan

	
1988

	
2,839,181.26

	
0.00

	
2,839,181.26

	
28,858.18

	
28,949.75

	
28,858.18

	
91.57

	
60,818.74

	
 

	
(27) Feb

		
2,839,094.72

	
0.00

	
2,839,094.72

	
26,995.49

	
27,082.03

	
26,995.49

	
86.54

	
60,905.28

	
 

	
(28) Mar

		
2,839,001.34

	
0.00

	
2,839,001.34

	
28,856.37

	
28,949.75

	
28,856.37

	
93.38

	
60,998.66

	
 

	
(29) Apr

		
2,838,910.05

	
0.00

	
2,838,910.05

	
27,924.60

	
28,015.89

	
27,924.60

	
91.29

	
61,089.95

	
 

	
(30) May

		
2,838,814.80

	
0.00

	
2,838,814.80

	
28,854.50

	
28,949.75

	
28,854.50

	
95.25

	
61,185.20

	
 

	
(31) Jun

		
2,838,721.68

	
0.00

	
2,838,721.68

	
27,922.77

	
28,015.89

	
27,922.77

	
93.12

	
61,278.32

	
 

	
(32) Jul

		
2,838,624.51

	
0.00

	
2,838,624.51

	
28,852.58

	
28,949.75

	
28,852.58

	
97.17

	
61,375.49

	
 

	
(33) Aug

		
2,838,526.35

	
0.00

	
2,838,526.35

	
28,851.59

	
28,949.75

	
28,851.59

	
98.16

	
61,473.65

	
 

	
(34) Sept

		
2,838,430.39

	
0.00

	
2,838,430.39

	
27,919.93

	
28,015.89

	
27,919.93

	
95.96

	
61,569.61

	
 

	
(35) Oct

		
2,838,330.26

	
0.00

	
2,838,330.26

	
28,849.62

	
28,949.75

	
28,849.62

	
100.13

	
61,669.74

	
 

	
(36) Nov

		
2,838,232.37

	
0.00

	
2,838,232.37

	
27,918.00

	
28,015.89

	
27,918.00

	
97.89

	
61,767.63

	
 

	
(37) Dec

		
2,838,130.23

	
0.00

	
2,838,130.23

	
28,847.61

	
28,949.75

	
28,847.61

	
102.14

	
61,869.77

	
 

	
(38) Jan

	
1989

	
2,838,106.08

	
0.00

	
2,838,106.08

	
28,925.60

	
28,949.75

	
28,925.60

	
24.15

	
61,893.92

	
 

	
(39) Feb

		
2,838,087.05

	
0.00

	
2,838,087.05

	
26,126.13

	
26,145.16

	
26,126.13

	
19.03

	
61,912.95

	
 

	
(40) Mar

		
2,838,062.46

	
0.00

	
2,838,062.46

	
28,925.16

	
28,949.75

	
28,925.16

	
24.59

	
61,937.54

	
 

	
(41) Apr

		
2,838,038.42

	
0.00

	
2,838,038.42

	
27,991.85

	
28,015.89

	
27,991.85

	
24.04

	
61,961.58

	
 

	
(42) May

		
2,838,013.34

	
0.00

	
2,838,013.34

	
28,924.67

	
28,949.75

	
28,924.67

	
25.08

	
61,986.66

	
 

	
(43) Jun

		
2,837,988.81

	
0.00

	
2,837,988.81

	
27,991.36

	
28,015.89

	
27,991.36

	
24.53

	
62,011.19

	
 

	
(44) Jul

		
2,837,963.22

	
0.00

	
2,837,963.22

	
28,924.16

	
28,949.75

	
28,924.16

	
25.59

	
62,036.78

	
 

	
(45) Aug

		
2,837,937.37

	
0.00

	
2,837,937.37

	
28,923.90

	
28,949.75

	
28,923.90

	
25.85

	
62,062.63

	
 

	
(46) Sept

		
2,837,912.10

	
0.00

	
2,837,912.10

	
27,990.62

	
28,015.89

	
27,990.62

	
25.27

	
62,087.90

	
 

	
(47) Oct

		
2,837,885.73

	
0.00

	
2,837,885.73

	
28,923.38

	
28,949.75

	
28,923.38

	
26.37

	
62,114.27

	
 

	
(48) Nov

		
2,837,859.95

	
0.00

	
2,837,859.95

	
27,990.11

	
28,015.89

	
27,990.11

	
25.78

	
62,140.05

	
 

	
(49) Dec

		
2,837,833.05

	
0.00

	
2,837,833.05

	
28,922.85

	
28,949.75

	
28,922.85

	
26.90

	
62,166.95

	
 

	
(50) Jan

	
1990

	
2,837,805.87

	
0.00

	
2,837,805.87

	
28,922.57

	
28,949.75

	
28,922.57

	
27.18

	
62,194.13

	
 

	
(51) Feb

		
2,837,781.07

	
0.00

	
2,837,781.07

	
26,123.36

	
26,148.16

	
26,123.36

	
24.80

	
62,218.93

	
 

	
(52) Mar

		
2,837,753.36

	
0.00

	
2,837,753.36

	
28,922.04

	
28,949.75

	
28,922.04

	
27.71

	
62,246.64

	
 

	
(53) Apr

		
2,837,753.36

	
27,988.80

	
2,865,742.16

	
27,988.80

	
0.00

	
0.00

	
0.00

	
62,246.64

	
 

	
(54) May

		
2,837,753.36

	
34,307.91

	
2,872,061.27

	
28,921.76

	
22,602.65

	
22,602.65

	
0.00

	
62,246.64

	
 

	
(55) Jun

		
2,837,753.36

	
40,795.71

	
2,878,549.07

	
27,988.80

	
21,501.00

	
21,501.00

	
0.00

	
62,246.64

	
 

	
(56) Jul

		
2,837,753.36

	
69,717.47

	
2,907,470.83

	
28,921.76

	
0.00

	
0.00

	
0.00

	
62,246.64

	
 

	
(57) Aug

		
2,837,753.36

	
98,639.23

	
2,936,392.59

	
28,921.76

	
0.00

	
0.00

	
0.00

	
62,246.64

	
 

	
(58) Sept

		
2,837,753.36

	
104,128.03

	
2,941,881.39

	
27,988.80

	
22,500.00

	
22,500.00

	
0.00

	
62,246.64

	
 

	
(59) Oct

		
2,837,753.36

	
133,049.79

	
2,970,803.15

	
28,921.76

	
0.00

	
0.00

	
0.00

	
62,246.64

	
 

	
(60) Nov

		
2,837,753.36

	
161,038.59

	
2,998,791.95

	
27,988.80

	
0.00

	
0.00

	
0.00

	
62,246.64

	
 

	
(61) Dec

		
2,837,753.36

	
189,960.35

	
3,027,713.71

	
28,921.76

	
0.00

	
0.00

	
0.00

	
62,246.64

	
 

	
(62) Jan

	
1991

	
2,837,753.36

	
218,882.11

	
3,056,635.47

	
28,921.76

	
0.00

	
0.00

	
0.00

	
62,246.64

	
 

	
(63) Feb

		
2,837,753.36

	
216,504.99

	
3,054,258.35

	
26,122.88

	
28,500.00

	
28,500.00

	
0.00

	
62,246.64

	
 

	
(64) Mar

		
2,837,753.36

	
245,426.75

	
3,083,180.11

	
28,921.76

	
0.00

	
0.00

	
0.00

	
62,246.64

	
 

	
(65) Apr

		
2,837,753.36

	
244,915.55

	
3,082,668.91

	
27,988.80

	
28,500.00

	
28,500.00

	
0.00

	
62,246.64

	
 

	
(66) May

		
2,837,753.36

	
245,337.31

	
3,083,090.67

	
28,921.76

	
28,500.00

	
28,500.00

	
0.00

	
62,246.64

	
 

	
(67) Jun

		
2,837,753.36

	
273,326.11

	
3,111,079.47

	
27,988.80

	
0.00

	
0.00

	
0.00

	
62,246.64

	
 

	
(68) Jul

		
2,837,753.36

	
302,247.87

	
3,140,001.23

	
28,921.76

	
0.00

	
0.00

	
0.00

	
62,246.64

	
 

					
ROBINSON BRIDGE NOTE

			
8/27/200412:47 PM

										
			
(1)

	
(2)

	
(3)

	
(4)

	
(5)

	
(6)

	
(7)

	
(8)

										
				
Total

	
Total

	
12.0%

				
Cumulative

				
Interest

	
Principal plus

	
Current Month

		
Payment Application

	
Principal

			
Principal

	
Due

	
Interest Due

	
Interest

	
Payment

	
Interest

	
Principal

	
Reductions

	
(69) Aug

		
2,837,753.36

	
331,169.63

	
3,168,922.99

	
28,921.76

	
0.00

	
0.00

	
0.00

	
62,246.64

	
(70) Sept

		
2,837,753.36

	
330,658.43

	
3,168,411.79

	
27,988.80

	
28,500.00

	
28,500.00

	
0.00

	
62,246.64

	
(71) Oct

		
2,837,753.36

	
331,080.19

	
3,168,833.55

	
28,921.76

	
28,500.00

	
28,500.00

	
0.00

	
62,246.64

	
(72) Nov

		
2,837,753.36

	
359,068.99

	
3,196,822.35

	
27,988.80

	
0.00

	
0.00

	
0.00

	
62,246.64

	
(73) Dec

		
2,837,753.36

	
359,490.75

	
3,197,244.11

	
28,921.76

	
28,500.00

	
28,500.00

	
0.00

	
62,246.64

	
(74) Jan

	
1992

	
2,837,753.36

	
375,825.49

	
3,213,578.85

	
28,842.74

	
12,508.00

	
12,508.00

	
0.00

	
62,246.64

	
(75) Feb

		
2,837,753.36

	
345,807.41

	
3,183,560.77

	
26,981.92

	
57,000.00

	
57,000.00

	
0.00

	
62,246.64

	
(76) Mar

		
2,837,753.36

	
346,650.15

	
3,184,403.51

	
28,842.74

	
28,000.00

	
28,000.00

	
0.00

	
62,246.64

	
(77) Apr

		
2,837,753.36

	
374,562.48

	
3,212,315.84

	
27,912.33

	
0.00

	
0.00

	
0.00

	
62,246.64

	
(78) May

		
2,837,753.36

	
346,405.22

	
3,184,158.58

	
28,842.74

	
57,000.00

	
57,000.00

	
0.00

	
62,246.64

	
(79) Jun

		
2,837,753.36

	
374,317.55

	
3,212,070.91

	
27,912.33

	
0.00

	
0.00

	
0.00

	
62,246.64

	
(80) Jul

		
2,837,753.36

	
346,160.29

	
3,183,913.65

	
28,842.74

	
57,000.00

	
57,000.00

	
0.00

	
62,246.64

	
(81) Aug

		
2,837,753.36

	
375,003.03

	
3,212,756.39

	
28,842.74

	
0.00

	
0.00

	
0.00

	
62,246.64

	
(82) Sept

		
2,837,753.36

	
317,415.36

	
3,155,168.72

	
27,912.33

	
85,500.00

	
85,500.00

	
0.00

	
62,246.64

	
(83) Oct

		
2,837,753.36

	
346,258.10

	
3,184,011.46

	
28,842.74

	
0.00

	
0.00

	
0.00

	
62,246.64

	
(84) Nov

		
2,837,753.36

	
317,170.43

	
3,154,923.79

	
27,912.33

	
57,000.00

	
57,000.00

	
0.00

	
62,246.64

	
(85) Dec

		
2,837,753.36

	
346,013.17

	
3,183,766.53

	
28,842.74

	
0.00

	
0.00

	
0.00

	
62,246.64

	
(86) Jan

	
1993

	
2,837,753.36

	
374,934.93

	
3,212,688.29

	
28,921.76

	
0.00

	
0.00

	
0.00

	
62,246.64

	
(87) Feb

		
2,837,753.36

	
306,618.81

	
3,144,372.17

	
26,122.88

	
94,439.00

	
94,439.00

	
0.00

	
62,246.64

	
(88) Mar

		
2,837,753.36

	
335,540.57

	
3,173,293.93

	
28,921.76

	
0.00

	
0.00

	
0.00

	
62,246.64

	
(89) Apr

		
2,837,753.36

	
335,029.37

	
3,172,782.73

	
27,988.80

	
28,500.00

	
28,500.00

	
0.00

	
62,246.64

	
(90) May

		
2,837,753.36

	
363,951.13

	
3,201,704.49

	
28,921.76

	
0.00

	
0.00

	
0.00

	
62,246.64

	
(91) Jun

		
2,837,753.36

	
391,939.93

	
3,229,693.29

	
27,988.80

	
0.00

	
0.00

	
0.00

	
62,246.64

	
(92) Jul

		
2,837,753.36

	
377,861.69

	
3,215,615.05

	
28,921.76

	
43,000.00

	
43,000.00

	
0.00

	
62,246.64

	
(93) Aug

		
2,837,753.36

	
406,783.45

	
3,244,536.81

	
28,921.76

	
0.00

	
0.00

	
0.00

	
62,246.64

	
(94) Sept

		
2,837,753.36

	
406,272.25

	
3,244,025.61

	
27,988.80

	
28,500.00

	
28,500.00

	
0.00

	
62,246.64

	
(95) Oct

		
2,837,753.36

	
406,694.01

	
3,244,447.37

	
28,921.76

	
28,500.00

	
28,500.00

	
0.00

	
62,246.64

	
(96) Nov

		
2,837,753.36

	
434,682.81

	
3,272,436.17

	
27,988.80

	
0.00

	
0.00

	
0.00

	
62,246.64

	
(97) Dec

		
2,837,753.36

	
463,604.57

	
3,301,357.93

	
28,921.76

	
0.00

	
0.00

	
0.00

	
62,246.64

	
(98) Jan

	
1994

	
2,837,753.36

	
492,526.33

	
3,330,279.69

	
28,921.76

	
0.00

	
0.00

	
0.00

	
62,246.64

	
(99) Feb

		
2,837,753.36

	
368,914.21

	
3,206,667.57

	
26,122.88

	
149,735.00

	
149,735.00

	
0.00

	
62,246.64

	
(100) Mar

		
2,837,753.36

	
397,835.97

	
3,235,589.33

	
28,921.76

	
0.00

	
0.00

	
0.00

	
62,246.64

	
(101) Apr

		
2,837,753.36

	
425,824.77

	
3,263,578.13

	
27,988.80

	
0.00

	
0.00

	
0.00

	
62,246.64

	
(102) May

		
2,837,753.36

	
369,246.53

	
3,206,999.89

	
28,921.76

	
85,500.00

	
85,500.00

	
0.00

	
62,246.64

	
(103) Jun

		
2,837,753.36

	
397,235.33

	
3,234,988.69

	
27,988.80

	
0.00

	
0.00

	
0.00

	
62,246.64

	
(104) Jul

		
2,837,753.36

	
426,157.09

	
3,263,910.45

	
28,921.76

	
0.00

	
0.00

	
0.00

	
62,246.64

	
(105) Aug

		
2,837,753.36

	
369,578.85

	
3,207,332.21

	
28,921.76

	
85,500.00

	
85,500.00

	
0.00

	
62,246.64

	
(106) Sept

		
2,837,753.36

	
397,567.65

	
3,235,321.01

	
27,988.80

	
0.00

	
0.00

	
0.00

	
62,246.64

	
(107) Oct

		
2,837,753.36

	
397,989.41

	
3,235,742.77

	
28,921.76

	
28,500.00

	
28,500.00

	
0.00

	
62,246.64

	
(108) Nov

		
2,837,753.36

	
425,978.21

	
3,263,731.57

	
27,988.80

	
0.00

	
0.00

	
0.00

	
62,246.64

	
(109) Dec

		
2,837,753.36

	
454,899.97

	
3,292,653.33

	
28,921.76

	
0.00

	
0.00

	
0.00

	
62,246.64

	
(110) Jan

	
1995

	
2,837,753.36

	
368,895.73

	
3,206,649.09

	
28,921.76

	
114,926.00

	
114,926.00

	
0.00

	
62,246.64

	
(111) Feb

		
2,837,753.36

	
395,018.61

	
3,232,771.97

	
26,122.88

	
0.00

	
0.00

	
0.00

	
62,246.64

	
(112) Mar

		
2,837,753.36

	
423,940.37

	
3,261,693.73

	
28,921.76

	
0.00

	
0.00

	
0.00

	
62,246.64

	
(113) Apr

		
2,837,753.36

	
394,929.17

	
3,232,682.53

	
27,988.80

	
57,000.00

	
57,000.00

	
0.00

	
62,246.64

	
(114) May

		
2,837,753.36

	
395,350.93

	
3,233,104.29

	
28,921.76

	
28,500.00

	
28,500.00

	
0.00

	
62,246.64

	
(115) June

		
2,837,753.36

	
394,839.73

	
3,232,593.09

	
27,988.80

	
28,500.00

	
28,500.00

	
0.00

	
62,246.64

	
(116) Jul

		
2,837,753.36

	
395,261.49

	
3,233,014.85

	
28,921.76

	
28,500.00

	
28,500.00

	
0.00

	
62,246.64

	
(117) Aug

		
2,837,753.36

	
424,183.25

	
3,261,936.61

	
28,921.76

	
0.00

	
0.00

	
0.00

	
62,246.64

	
(118) Sept

		
2,837,753.36

	
452,172.05

	
3,289,925.41

	
27,988.80

	
0.00

	
0.00

	
0.00

	
62,246.64

	
(119) Oct

		
2,837,753.36

	
481,093.81

	
3,318,847.17

	
28,921.76

	
0.00

	
0.00

	
0.00

	
62,246.64

	
(120) Nov

		
2,837,753.36

	
509,082.61

	
3,346,835.97

	
27,988.80

	
0.00

	
0.00

	
0.00

	
62,246.64

	
(121) Dec

		
2,837,753.36

	
538,004.37

	
3,375,757.73

	
28,921.76

	
0.00

	
0.00

	
0.00

	
62,246.64

	
(122) Jan

	
1996

	
2,837,753.36

	
566,847.11

	
3,404,600.47

	
28,842.74

	
0.00

	
0.00

	
0.00

	
62,246.64

	
(123) Feb

		
2,837,753.36

	
593,829.03

	
3,431,582.39

	
26,981.92

	
0.00

	
0.00

	
0.00

	
62,246.64

	
(124) Mar

		
2,837,753.36

	
622,671.77

	
3,460,425.13

	
28,842.74

	
0.00

	
0.00

	
0.00

	
62,246.64

	
(125) Apr

		
2,837,753.36

	
650,584.10

	
3,488,337.46

	
27,912.33

	
0.00

	
0.00

	
0.00

	
62,246.64

	
(126) May

		
2,837,753.36

	
679,426.84

	
3,517,180.20

	
28,842.74

	
0.00

	
0.00

	
0.00

	
62,246.64

	
(127) June

		
2,837,753.36

	
707,339.17

	
3,545,092.53

	
27,912.33

	
0.00

	
0.00

	
0.00

	
62,246.64

	
(128) Jul

		
2,837,753.36

	
736,181.91

	
3,573,935.27

	
28,842.74

	
0.00

	
0.00

	
0.00

	
62,246.64

	
(129) Aug

		
2,837,753.36

	
765,024.65

	
3,602,778.01

	
28,842.74

	
0.00

	
0.00

	
0.00

	
62,246.64

	
(130) Sept

		
2,837,753.36

	
792,936.98

	
3,630,690.34

	
27,912.33

	
0.00

	
0.00

	
0.00

	
62,246.64

	
(131) Oct

		
2,837,753.36

	
821,779.72

	
3,659,533.08

	
28,842.74

	
0.00

	
0.00

	
0.00

	
62,246.64

	
(132) Nov

		
2,837,753.36

	
849,692.05

	
3,687,445.41

	
27,912.33

	
0.00

	
0.00

	
0.00

	
62,246.64

	
(133) Dec

		
2,837,753.36

	
878,534.79

	
3,716,288.15

	
28,842.74

	
0.00

	
0.00

	
0.00

	
62,246.64

	
(134) Jan

	
1997

	
2,837,753.36

	
907,456.55

	
3,745,209.91

	
28,921.76

	
0.00

	
0.00

	
0.00

	
62,246.64

	
(135) Feb

		
2,837,753.36

	
933,579.43

	
3,771,332.79

	
26,122.88

	
0.00

	
0.00

	
0.00

	
62,246.64

	
(136) Mar

		
2,837,753.36

	
962,501.19

	
3,800,254.55

	
28,921.76

	
0.00

	
0.00

	
0.00

	
62,246.64

	
(137) Apr

		
2,837,753.36

	
990,489.99

	
3,828,243.35

	
27,988.80

	
0.00

	
0.00

	
0.00

	
62,246.64

					
ROBINSON BRIDGE NOTE

			
8/27/200412:47 PM

										
			
(1)

	
(2)

	
(3)

	
(4)

	
(5)

	
(6)

	
(7)

	
(8)

										
				
Total

	
Total

	
12.0%

				
Cumulative

				
Interest

	
Principal plus

	
Current Month

		
Payment Application

	
Principal

			
Principal

	
Due

	
Interest Due

	
Interest

	
Payment

	
Interest

	
Principal

	
Reductions

	
(138) May

		
2,837,753.36

	
1,019,411.75

	
3,857,165.11

	
28,921.76

	
0.00

	
0.00

	
0.00

	
62,246.64

	
(139) June

		
2,837,753.36

	
1,047,400.55

	
3,885,153.91

	
27,988.80

	
0.00

	
0.00

	
0.00

	
62,246.64

	
(140) Jul

		
2,837,753.36

	
1,076,322.31

	
3,914,075.67

	
28,921.76

	
0.00

	
0.00

	
0.00

	
62,246.64

	
(141) Aug

		
2,837,753.36

	
1,105,244.07

	
3,942,997.43

	
28,921.76

	
0.00

	
0.00

	
0.00

	
62,246.64

	
(142) Sept

		
2,837,753.36

	
1,133,232.87

	
3,970,986.23

	
27,988.80

	
0.00

	
0.00

	
0.00

	
62,246.64

	
(143) Oct

		
2,837,753.36

	
1,162,154.63

	
3,999,907.99

	
28,921.76

	
0.00

	
0.00

	
0.00

	
62,246.64

	
(144) Nov

		
2,837,753.36

	
1,190,143.43

	
4,027,896.79

	
27,988.80

	
0.00

	
0.00

	
0.00

	
62,246.64

	
(145) Dec

		
2,837,753.36

	
1,219,065.19

	
4,056,818.55

	
28,921.76

	
0.00

	
0.00

	
0.00

	
62,246.64

	
(146) Jan

	
1998

	
2,837,753.36

	
1,247,986.95

	
4,085,740.31

	
28,921.76

	
0.00

	
0.00

	
0.00

	
62,246.64

	
(147) Feb

		
2,837,753.36

	
1,274,109.83

	
4,111,863.19

	
26,122.88

	
0.00

	
0.00

	
0.00

	
62,246.64

	
(148) Mar

		
2,837,753.36

	
1,303,031.59

	
4,140,784.95

	
28,921.76

	
0.00

	
0.00

	
0.00

	
62,246.64

	
(149) Apr

		
2,837,753.36

	
1,331,020.39

	
4,168,773.75

	
27,988.80

	
0.00

	
0.00

	
0.00

	
62,246.64

	
(150) May

		
2,837,753.36

	
1,359,942.15

	
4,197,695.51

	
28,921.76

	
0.00

	
0.00

	
0.00

	
62,246.64

	
(151) June

		
2,837,753.36

	
1,387,930.95

	
4,225,684.31

	
27,988.80

	
0.00

	
0.00

	
0.00

	
62,246.64

	
(152) Jul

		
2,837,753.36

	
1,416,852.71

	
4,254,606.07

	
28,921.76

	
0.00

	
0.00

	
0.00

	
62,246.64

	
(153) Aug

		
2,837,753.36

	
1,445,774.47

	
4,283,527.83

	
28,921.76

	
0.00

	
0.00

	
0.00

	
62,246.64

	
(154) Sept

		
2,837,753.36

	
1,473,763.27

	
4,311,516.63

	
27,988.80

	
0.00

	
0.00

	
0.00

	
62,246.64

	
(155) Oct

		
2,837,753.36

	
1,502,685.03

	
4,340,438.39

	
28,921.76

	
0.00

	
0.00

	
0.00

	
62,246.64

	
(156) Nov

		
2,837,753.36

	
1,530,673.83

	
4,368,427.19

	
27,988.80

	
0.00

	
0.00

	
0.00

	
62,246.64

	
(157) Dec

		
2,837,753.36

	
1,559,595.59

	
4,397,348.95

	
28,921.76

	
0.00

	
0.00

	
0.00

	
62,246.64

	
(158) Jan

	
1999

	
2,837,753.36

	
1,588,517.35

	
4,426,270.71

	
28,921.76

	
0.00

	
0.00

	
0.00

	
62,246.64

	
(159) Feb

		
2,837,753.36

	
1,614,640.23

	
4,452,393.59

	
26,122.88

	
0.00

	
0.00

	
0.00

	
62,246.64

										
	
SETTLEMENT

								
										
	
(160) Feb

		
2,840,500.00

	
1,617,082.00

	
4,457,582.00

					
	
(161) Mar

		
2,840,500.00

	
0.00

	
2,840,500.00

	
28,405.00

	
1,645,487.00

	
1,645,487.00

	
0.00

	
0.00

	
(162) Apr

		
2,840,500.00

	
0.00

	
2,840,500.00

	
28,405.00

	
28,405.00

	
28,405.00

	
0.00

	
0.00

	
(163) May

		
2,840,500.00

	
0.00

	
2,840,500.00

	
28,405.00

	
28,405.00

	
28,405.00

	
0.00

	
0.00

	
(164) June

		
2,657,185.00

	
0.00

	
2,657,185.00

	
28,405.00

	
211,720.00

	
28,405.00

	
183,315.00

	
183,315.00

	
(165) Jul

		
2,629,752.28

	
0.00

	
2,629,752.28

	
26,571.85

	
54,004.57

	
26,571.85

	
27,432.72

	
210,747.72

	
(166) Aug

		
2,602,096.25

	
0.00

	
2,602,096.25

	
26,297.52

	
53,953.55

	
26,297.52

	
27,656.03

	
238,403.75

	
(167) Sept

		
2,574,157.32

	
0.00

	
2,574,157.32

	
26,020.96

	
53,959.89

	
26,020.96

	
27,938.93

	
266,342.68

	
(168) Oct

		
2,545,938.95

	
0.00

	
2,545,938.95

	
25,741.57

	
53,959.94

	
25,741.57

	
28,218.37

	
294,561.05

	
(169) Nov

		
2,517,435.16

	
0.00

	
2,517,435.16

	
25,459.39

	
53,963.18

	
25,459.39

	
28,503.79

	
323,064.84

	
(170) Dec

		
2,488,649.57

	
0.00

	
2,488,649.57

	
25,174.35

	
53,959.94

	
25,174.35

	
28,785.59

	
351,850.43

	
(171) Jan

	
2000

	
2,458,782.96

	
0.00

	
2,458,782.96

	
24,886.50

	
54,753.11

	
24,886.50

	
29,866.61

	
381,717.04

	
(172) Feb

		
2,429,402.63

	
0.00

	
2,429,402.63

	
24,587.83

	
53,968.16

	
24,587.83

	
29,380.33

	
411,097.37

	
(173) Mar

		
2,393,514.21

	
0.00

	
2,393,514.21

	
24,294.03

	
60,182.45

	
24,294.03

	
35,888.42

	
446,985.79

	
(174) Apr

		
2,357,271.58

	
0.00

	
2,357,271.58

	
23,935.14

	
60,177.77

	
23,935.14

	
36,242.63

	
483,228.42

	
(175) May

		
2,320,674.60

	
0.00

	
2,320,674.60

	
23,572.72

	
60,169.70

	
23,572.72

	
36,596.98

	
519,825.40

	
(176) June

		
2,283,550.59

	
0.00

	
2,283,550.59

	
23,206.75

	
60,330.76

	
23,206.75

	
37,124.01

	
556,949.41

	
(177) Jul

		
2,246,059.70

	
0.00

	
2,246,059.70

	
22,835.51

	
60,326.40

	
22,835.51

	
37,490.89

	
594,440.30

	
(178) Aug

		
2,208,216.08

	
0.00

	
2,208,216.08

	
22,460.60

	
60,304.22

	
22,460.60

	
37,843.62

	
632,283.92

	
(179) Sept

		
2,170,022.70

	
0.00

	
2,170,022.70

	
22,082.16

	
60,275.54

	
22,082.16

	
38,193.38

	
670,477.30

	
(180) Oct

		
2,131,400.17

	
0.00

	
2,131,400.17

	
21,700.23

	
60,322.76

	
21,700.23

	
38,622.53

	
709,099.83

	
(181) Nov

		
2,092,416.25

	
0.00

	
2,092,416.25

	
21,314.00

	
60,297.92

	
21,314.00

	
38,983.92

	
748,083.75

	
(182) Dec

		
2,053,049.14

	
0.00

	
2,053,049.14

	
20,924.16

	
60,291.27

	
20,924.16

	
39,367.11

	
787,450.86

	
(183) Jan

	
2001

	
2,013,281.45

	
0.00

	
2,013,281.45

	
20,530.49

	
60,298.18

	
20,530.49

	
39,767.69

	
827,218.55

	
(184) Feb

		
1,975,869.40

	
0.00

	
1,975,869.40

	
20,132.81

	
57,544.86

	
20,132.81

	
37,412.05

	
864,630.60

	
(185) Mar

		
1,938,084.03

	
0.00

	
1,938,084.03

	
19,758.69

	
57,544.06

	
19,758.69

	
37,785.37

	
902,415.97

	
(186) Apr

		
1,899,920.47

	
0.00

	
1,899,920.47

	
19,380.84

	
57,544.40

	
19,380.84

	
38,163.56

	
940,579.53

	
(187) May

		
1,861,367.46

	
0.00

	
1,861,367.46

	
18,999.20

	
57,552.21

	
18,999.20

	
38,553.01

	
979,132.54

	
(188) June

		
1,822,436.73

	
0.00

	
1,822,436.73

	
18,613.67

	
57,544.40

	
18,613.67

	
38,930.73

	
1,018,063.27

	
(189) Jul

		
1,783,120.09

	
0.00

	
1,783,120.09

	
18,224.37

	
57,541.01

	
18,224.37

	
39,316.64

	
1,057,379.91

	
(190) Aug

		
1,743,401.63

	
0.00

	
1,743,401.63

	
17,831.20

	
57,549.66

	
17,831.20

	
39,718.46

	
1,097,098.37

	
(191) Sept

		
1,703,297.05

	
0.00

	
1,703,297.05

	
17,434.02

	
57,538.60

	
17,434.02

	
40,104.58

	
1,137,202.95

	
(192) Oct

		
1,662,786.99

	
0.00

	
1,662,786.99

	
17,032.97

	
57,543.03

	
17,032.97

	
40,510.06

	
1,177,713.01

	
(193) Nov

		
1,622,064.98

	
0.00

	
1,622,064.98

	
16,627.87

	
57,349.88

	
16,627.87

	
40,722.01

	
1,218,435.02

	
(194) Dec

		
1,580,752.05

	
0.00

	
1,580,752.05

	
16,220.65

	
57,533.58

	
16,220.65

	
41,312.93

	
1,259,747.95

	
(195) Jan

	
2002

	
1,580,752.05

	
15,807.52

	
1,596,559.57

	
15,807.52

	
0.00

	
0.00

	
0.00

	
1,259,747.95

	
(196) Feb

		
1,580,752.05

	
31,615.04

	
1,612,367.09

	
15,807.52

	
0.00

	
0.00

	
0.00

	
1,259,747.95

	
(197) Mar

		
1,580,752.05

	
47,422.56

	
1,628,174.61

	
15,807.52

	
0.00

	
0.00

	
0.00

	
1,259,747.95

	
(198) Apr

		
1,580,752.05

	
63,230.08

	
1,643,982.13

	
15,807.52

	
0.00

	
0.00

	
0.00

	
1,259,747.95

	
(199) May

		
1,580,752.05

	
79,037.60

	
1,659,789.65

	
15,807.52

	
0.00

	
0.00

	
0.00

	
1,259,747.95

	
(200) June

		
1,580,752.05

	
94,845.12

	
1,675,597.17

	
15,807.52

	
0.00

	
0.00

	
0.00

	
1,259,747.95

	
(201) Jul

		
1,580,752.05

	
110,652.64

	
1,691,404.69

	
15,807.52

	
0.00

	
0.00

	
0.00

	
1,259,747.95

	
(202) Aug

		
1,308,289.96

	
0.00

	
1,308,289.96

	
15,807.52

	
398,922.25

	
126,460.16

	
272,462.09

	
1,532,210.04

	
(203) Sept

		
1,264,648.05

	
0.00

	
1,264,648.05

	
13,082.90

	
56,724.81

	
13,082.90

	
43,641.91

	
1,575,851.95

					
ROBINSON BRIDGE NOTE

			
8/27/200412:47 PM

										
			
(1)

	
(2)

	
(3)

	
(4)

	
(5)

	
(6)

	
(7)

	
(8)

										
				
Total

	
Total

	
12.0%

				
Cumulative

				
Interest

	
Principal plus

	
Current Month

		
Payment Application

	
Principal

			
Principal

	
Due

	
Interest Due

	
Interest

	
Payment

	
Interest

	
Principal

	
Reductions

	
(204) Oct

		
1,219,774.34

	
0.00

	
1,219,774.34

	
12,646.48

	
57,520.19

	
12,646.48

	
44,873.71

	
1,620,725.66

	
(205) Nov

		
1,172,982.15

	
0.00

	
1,172,982.15

	
12,197.74

	
58,989.93

	
12,197.74

	
46,792.19

	
1,667,517.85

	
(206) Dec

		
1,127,211.97

	
0.00

	
1,127,211.97

	
11,729.82

	
57,500.00

	
11,729.82

	
45,770.18

	
1,713,288.03

	
(207) Jan

	
2003

	
1,080,984.09

	
0.00

	
1,080,984.09

	
11,272.12

	
57,500.00

	
11,272.12

	
46,227.88

	
1,759,515.91

	
(208) Feb

		
1,034,293.93

	
0.00

	
1,034,293.93

	
10,809.84

	
57,500.00

	
10,809.84

	
46,690.16

	
1,806,206.07

	
(209) Mar

		
986,991.87

	
0.00

	
986,991.87

	
10,342.94

	
57,645.00

	
10,342.94

	
47,302.06

	
1,853,508.13

	
(210) Apr

		
939,302.79

	
0.00

	
939,302.79

	
9,869.92

	
57,559.00

	
9,869.92

	
47,689.08

	
1,901,197.21

	
(211) May

		
891,176.82

	
0.00

	
891,176.82

	
9,393.03

	
57,519.00

	
9,393.03

	
48,125.97

	
1,949,323.18

	
(212) June

		
842,554.59

	
0.00

	
842,554.59

	
8,911.77

	
57,534.00

	
8,911.77

	
48,622.23

	
1,997,945.41

	
(213) Jul

		
793,445.14

	
0.00

	
793,445.14

	
8,425.55

	
57,535.00

	
8,425.55

	
49,109.45

	
2,047,054.86

	
(214) Aug

		
743,847.59

	
0.00

	
743,847.59

	
7,934.45

	
57,532.00

	
7,934.45

	
49,597.55

	
2,096,652.41

	
(215) Sept

		
693,746.07

	
0.00

	
693,746.07

	
7,438.48

	
57,540.00

	
7,438.48

	
50,101.52

	
2,146,753.93

	
(216) Oct

		
643,137.53

	
0.00

	
643,137.53

	
6,937.46

	
57,546.00

	
6,937.46

	
50,608.54

	
2,197,362.47

	
(217) Nov

		
592,048.95

	
0.00

	
592,048.95

	
6,431.38

	
57,519.96

	
6,431.38

	
51,088.58

	
2,248,451.05

	
(218) Dec

		
540,422.65

	
0.00

	
540,422.65

	
5,920.49

	
57,546.79

	
5,920.49

	
51,626.30

	
2,300,077.35

	
(219) Jan

	
2004

	
488,285.02

	
0.00

	
488,285.02

	
5,404.23

	
57,541.86

	
5,404.23

	
52,137.63

	
2,352,214.98

	
(220) Feb

		
435,632.11

	
0.00

	
435,632.11

	
4,882.85

	
57,535.76

	
4,882.85

	
52,652.91

	
2,404,867.89

	
(221) Mar

		
382,446.17

	
0.00

	
382,446.17

	
4,356.32

	
57,542.26

	
4,356.32

	
53,185.94

	
2,458,053.83

	
(222) Apr

		
328,734.84

	
0.00

	
328,734.84

	
3,824.46

	
57,535.79

	
3,824.46

	
53,711.33

	
2,511,765.16

	
(223) May

		
274,492.91

	
0.00

	
274,492.91

	
3,287.35

	
57,529.28

	
3,287.35

	
54,241.93

	
2,566,007.09

	
(224) June

		
219,696.49

	
0.00

	
219,696.49

	
2,744.93

	
57,541.35

	
2,744.93

	
54,796.42

	
2,620,803.51

	
(225) Jul

		
164,362.15

	
0.00

	
164,362.15

	
2,196.96

	
57,531.30

	
2,196.96

	
55,334.34

	
2,676,137.85

	
(226) Aug

		
108,011.38

	
0.00

	
108,011.38

	
1,643.62

	
57,994.39

	
1,643.62

	
56,350.77

	
2,732,488.62

	
(227) Sept

		
108,011.38

	
1,080.11

	
109,091.49

	
1,080.11

	
0.00

	
0.00

	
0.00

	
2,732,488.62

	
(228) Oct

		
108,011.38

	
2,160.22

	
110,171.60

	
1,080.11

	
0.00

	
0.00

	
0.00

	
2,732,488.62

SCHEDULE 12.26A

Chi-Chi's, Inc.

C-C Restaurant, LTD-9 Non Recourse Promissory Note

				
Ending Principal and Interest

								
				
2003

		
2004

		
2005

		
Property

		
(Jan. 1 2004)

		
(Jan. 1 2005)

		
(Jan. 1 2006)

								
								
	
1

	
Unit 72 Peoria

	
$

	
1,541,039

	
$

	
1,756,784

	
$

	
2,002,734

	
2

	
Unit 73 Independence

		
1,957,450

		
2,231,493

		
2,543,902

	
3

	
Unit 74 Pittsburgh

		
2,159,798

		
2,462,169

		
2,806,873

	
4

	
Unit 82 Springfield

		
1,314,196

		
1,498,184

		
1,707,930

	
5

	
Unit 85 Wilmington

		
2,156,603

		
2,458,527

		
2,802,721

	
6

	
Unit 89 Florence

		
1,490,984

		
1,699,722

		
1,937,683

	
7

	
Unit 92 Charlottesville

		
1,318,456

		
1,503,040

		
1,713,466

	
8

	
Unit 93 Muncie

		
962,750

		
1,097,535

		
1,251,190

	
9

	
Unit 96 Lansing

		
1,546,364

		
1,762,855

		
2,009,655

	
10

	
Unit 98 Lafayette

		
1,112,913

		
1,268,721

		
1,446,342

	
11

	
Unit 304 Warren

		
1,608,133

		
1,833,272

		
2,089,930

	
12

	
Unit 313 Mentor

		
1,639,018

		
1,868,480

		
2,130,068

	
13

	
Unit 319 York

		
1,321,651

		
1,506,682

		
1,717,618

	
14

	
Unit 320 Niles

		
1,214,087

		
1,384,060

		
1,577,828

	
15

	
Unit 327 Maumee

		
1,362,121

		
1,552,818

		
1,770,212

			
$

	
22,705,564

	
$

	
25,884,343

	
$

	
29,508,151

Notes:

[a] Ending Principal and Interest reflects (i) accrued interest not paid on any such installment date, such installment dates beginning January 1, 1987, and added to the principal amount of this Note on the first
day immediately following such installment date and (ii) principal balance of this Note.

Privileged and Confidential

 8/26/2004, 4:26 PM

1 of 1

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