Document:

Registration Rights Agreement, July 13, 2005

 

EXHIBIT 4.3

 

REGISTRATION RIGHTS AGREEMENT

Dated as of July 13, 2005

Among

LENNAR CORPORATION

AND THE GUARANTORS NAMED HEREIN

as Issuers,

and

BARCLAYS CAPITAL INC.

DEUTSCHE BANK SECURITIES INC.

J.P. MORGAN SECURITIES INC.

WACHOVIA CAPITAL MARKETS, LLC

BANC OF AMERICA SECURITIES LLC

CALYON SECURITIES (USA) INC.

COMERICA SECURITIES, INC.

SUNTRUST CAPITAL MARKETS, INC.

BNP PARIBAS SECURITIES CORP.

and

GREENWICH CAPITAL MARKETS, INC.

as Initial Purchasers

5.60% Senior Notes due 2015

 

 

 

REGISTRATION RIGHTS AGREEMENT

          This Registration Rights Agreement (this “Agreement”) is made and entered into as of
July 13, 2005, among LENNAR CORPORATION, a Delaware corporation (the “Company”), and the
other entities that are listed on the signature pages hereof (collectively with any entity that in
the future executes a supplemental indenture pursuant to which such entity agrees to guarantee the
Notes (as hereinafter defined), the “Guarantors” and, together with the Company, the
“Issuers”), and BARCLAYS CAPITAL INC., DEUTSCHE BANK SECURITIES INC., J.P. MORGAN
SECURITIES INC., WACHOVIA CAPITAL MARKETS, LLC, BANC OF AMERICA SECURITIES LLC, CALYON SECURITIES
(USA) INC., COMERICA SECURITIES, INC., SUNTRUST CAPITAL MARKETS, INC., BNP PARIBAS SECURITIES CORP.
and GREENWICH CAPITAL MARKETS, INC. (each, an “Initial Purchaser” and, collectively, the
“Initial Purchasers”) for whom Barclays Capital Inc., Deutsche Bank Securities Inc., J.P.
Morgan Securities Inc. and Wachovia Capital Markets, LLC are acting as representatives.

          This Agreement is entered into in connection with the Purchase Agreement, dated July 6, 2005,
among the Company and the Initial Purchasers (the “Purchase Agreement”), which provides for
the sale by the Company to the Initial Purchasers of $200,000,000 aggregate principal amount (the
“Notes”) of the Company’s 5.60% Senior Notes due 2015. The Notes are unconditionally
guaranteed (the “Guarantees”) by each of the Guarantors. The Notes and the Guarantees are
collectively referred to herein as the “Securities”. In order to induce the Initial
Purchasers to enter into the Purchase Agreement, the Issuers have agreed to provide the
registration rights set forth in this Agreement for the benefit of the Initial Purchasers and any
subsequent holder or holders of the Securities. The execution and delivery of this Agreement is a
condition to the Initial Purchasers’ obligation to purchase the Securities under the Purchase
Agreement.

          On April 28, 2005, the Issuers entered into a similar registration rights agreement with the
purchasers named therein (the “Other Registration Rights Agreement”). The Other
Registration Rights Agreement was entered into in connection with the Purchase Agreement, dated
April 21, 2005, among the Company and the purchasers named on Schedule I thereto, under which the
Company sold $300,000,000 aggregate principal amount of the Company’s 5.60% Senior Notes due 2015
(the “Other Notes”). The Other Notes are unconditionally guaranteed (the “Other
Guarantees”) by each of the Guarantors. The Other Notes and the Other Guarantees are
collectively referred to herein as the “Other Securities”.

          The parties hereby agree as follows:

     1. Definitions

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

          Additional Interest: See Section 4 hereof.

          Advice: See the last paragraph of Section 5 hereof.

 

 

          Agreement: See the introductory paragraphs hereto.

          Applicable Period: See Section 2 hereof.

          Company: See the introductory paragraphs hereto.

          Effectiveness Date: October 10, 2005; provided, however, that with
respect to any Shelf Registration Statement, the Effectiveness Date shall be the 75th day following
the Filing Date with respect thereto.

          Effectiveness Period: See Section 3(a) hereof.

          Event Date: See Section 4(b) hereof.

          Exchange Act: The Securities Exchange Act of 1934, as amended, and the rules and
regulations of the SEC promulgated thereunder.

          Exchange Notes: See Section 2 hereof.

          Exchange Offer: See Section 2 hereof

          Exchange Offer Registration Statement: See Section 2 hereof.

          Filing Date: (A) If no Exchange Offer Registration Statement has been filed by the
Issuers pursuant to this Agreement, August 26, 2005; and (B) in each other case (which may be
applicable notwithstanding the consummation of the Exchange Offer), the 30th day after the delivery
of a Shelf Notice.

          Guarantees: See the introductory paragraphs hereto.

          Guarantors: See the introductory paragraphs hereto.

          Holder: Any holder of a Registrable Security or Registrable Securities.

          Indemnified Person: See Section 7(c) hereof.

          Indemnifying Person: See Section 7(c) hereof.

          Indenture: The Indenture, dated as of April 28, 2005, by and among the Issuers and
J.P. Morgan Trust Company, N.A., as trustee, pursuant to which the Notes are being issued, as the
same may be amended or supplemented from time to time in accordance with the terms thereof.

          Initial Purchasers: See the introductory paragraphs hereto.

          Initial Shelf Registration Statement: See Section 3(a) hereof.

          Inspectors: See Section 5(m) hereof.

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          Issue Date: April 28, 2005, the date of original issuance of the Other Securities.

          NASD: See Section 5(r) hereof.

          Notes: See the introductory paragraphs hereto.

          Offering Memorandum: The offering memorandum of the Company dated July 6, 2005, in
respect of the offering of the Securities.

          Other Exchange Notes: See Section 2(a) hereof.

          Other Guarantees: See the introductory paragraphs hereto.

          Other Notes: See the introductory paragraphs hereto.

          Other Registrable Securities: See Section 3(a) hereof.

          Other Registration Rights Agreement: See the introductory paragraphs hereto.

          Other Securities: See the introductory paragraphs hereto.

          Participant: See Section 7(a) hereof.

          Participating Broker-Dealer: See Section 2(a) hereof.

          Person: An individual, trustee, corporation, limited liability company, partnership,
joint stock company, trust, unincorporated association, union, business association, firm or other
legal entity.

          Private Exchange: See Section 2(b) hereof.

          Private Exchange Notes: See Section 2(b) hereof.

          Prospectus: The prospectus included in any Registration Statement (including, without
limitation, any prospectus subject to completion and a prospectus that includes any information
previously omitted from a prospectus filed as part of an effective registration statement in
reliance upon Rule 430A promulgated under the Securities Act and any term sheet filed pursuant to
Rule 434 under the Securities Act), as amended or supplemented by any prospectus supplement, and
all other amendments and supplements to the Prospectus, including post-effective amendments, and
all material incorporated by reference or deemed to be incorporated by reference in such
Prospectus.

          Purchase Agreement: See the introductory paragraphs hereto.

          Records: See Section 5(m) hereof.

          Registrable Notes: Each Note upon its original issuance and at all times subsequent
thereto, each Exchange Note as to which Section 2(c)(iv) hereof is applicable upon original
issuance and at all times subsequent thereto and each Private Exchange Note upon

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original issuance thereof and at all times subsequent thereto, until the earliest to occur of
(i) a Registration Statement (other than, with respect to any Exchange Note as to which Section
2(c)(iv) hereof is applicable, the Exchange Offer Registration Statement) covering such Note,
Exchange Note or Private Exchange Note has been declared effective by the SEC and such Note,
Exchange Note or such Private Exchange Note, as the case may be, has been disposed of in accordance
with such effective Registration Statement, (ii) such Note has been exchanged pursuant to the
Exchange Offer for an Exchange Note or Exchange Notes that may be resold (or, but for the status of
such Holder as an affiliate of the Issuers under Rule 405, could be resold) without restriction
under state and federal securities laws, (iii) such Note, Exchange Note or Private Exchange Note,
as the case may be, ceases to be outstanding for purposes of the Indenture or (iv) such Note,
Exchange Note or Private Exchange Note, as the case may be, may be resold without restriction
pursuant to Rule 144(k) (as amended or replaced) under the Securities Act.

          Registrable Securities: Each Registrable Note and related guarantees.

          Registration Statement: Any registration statement of the Issuers that covers any of
the Securities, the Exchange Notes (and related guarantees) or the Private Exchange Notes (and
related guarantees) filed with the SEC under the Securities Act, including the Prospectus,
amendments and supplements to such registration statement, including post-effective amendments, all
exhibits, and all material incorporated by reference or deemed to be incorporated by reference in
such registration statement.

          Rule 144: Rule 144 promulgated under the Securities Act, as such Rule may be amended
from time to time, or any similar rule (other than Rule 144A) or regulation hereafter adopted by
the SEC providing for offers and sales of securities made in compliance therewith resulting in
offers and sales by subsequent holders that are not affiliates of the issuer of such securities
being free of the registration and prospectus delivery requirements of the Securities Act.

          Rule 144A: Rule 144A promulgated under the Securities Act, as such Rule may be
amended from time to time, or any similar rule (other than Rule 144) or regulation hereafter
adopted by the SEC.

          Rule 405: Rule 405 under the Securities Act.

          Rule 415: Rule 415 promulgated under the Securities Act, as such Rule may be amended
from time to time, or any similar rule or regulation hereafter adopted by the SEC.

          SEC: The Securities and Exchange Commission.

          Securities: See the introductory paragraphs hereto.

          Securities Act: The Securities Act of 1933, as amended, and the rules and regulations
of the SEC promulgated thereunder.

          Shelf Notice: See Section 2(c) hereof.

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          Shelf Registration Statement: See Section 3(b) hereof.

          Subsequent Shelf Registration Statement: See Section 3(b) hereof.

          TIA: The Trust Indenture Act of 1939, as amended.

          Trustee: The trustee under the Indenture and the trustee (if any) under any indenture
governing the Exchange Notes (and related guarantees) and Private Exchange Notes (and related
guarantees).

          Underwritten registration or underwritten offering: A registration in which
securities of one or more of the Issuers are sold to an underwriter for reoffering to the public.

     2. Exchange Offer

          (a) The Issuers shall file with the SEC, no later than the Filing Date, a Registration
Statement (the “Exchange Offer Registration Statement”) on an appropriate registration form
with respect to a registered offer (the “Exchange Offer”) to exchange any and all of the
Registrable Securities for a like aggregate principal amount of notes of the Company, guaranteed by
the Guarantors, that are identical in all material respects to the Registrable Securities, except
that the Exchange Notes shall contain no restrictive legend thereon (the “Exchange Notes”),
and which are entitled to the benefits of the Indenture or a trust indenture which is identical in
all material respects to the Indenture (other than such changes to the Indenture or any such
identical trust indenture as are necessary to comply with the TIA) and which, in either case, has
been qualified under the TIA. Interest on each Exchange Note will accrue (A) from the later of (1)
the last interest payment date on which interest was paid on the Registrable Note surrendered, or
(2) if the Registrable Note is surrendered for exchange on a date in a period which includes the
record date for an interest payment date to occur on or after the date of the exchange and as to
which interest will be paid, such interest payment date or (B) if no interest has been paid on that
Registrable Note, from the Issue Date. The Exchange Offer shall comply with all applicable tender
offer rules and regulations under the Exchange Act and other applicable laws. The Issuers shall
use their reasonable best efforts to (x) cause the Exchange Offer Registration Statement to be
declared effective under the Securities Act on or before the Effectiveness Date; (y) keep the
Exchange Offer open for acceptance for not less than 30 days (or longer if required by applicable
law) after the date that notice of the Exchange Offer is mailed to Holders; and (z) consummate the
Exchange Offer on or before November 24, 2005. If, after the Exchange Offer Registration Statement
is initially declared effective by the SEC, the Exchange Offer or the issuance of the Exchange
Notes (and related guarantees) thereunder is interfered with by any stop order, injunction or other
order or requirement of the SEC or any other governmental agency or court, the Exchange Offer
Registration Statement shall be deemed not to have become effective for purposes of this Agreement.

          Each Holder that participates in the Exchange Offer will be required, as a condition to its
participation in the Exchange Offer, to represent to the Company in writing (which may be contained
in the applicable letter of transmittal) (1) that any Exchange Notes (and related guarantees) to be
received by it will be acquired in the ordinary course of its business, (2) that at the time of the
consummation of the Exchange Offer such Holder will have no

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arrangement or understanding with any Person to participate in the distribution of the
Exchange Notes (and related guarantees) in violation of the provisions of the Securities Act, (3)
that such Holder is not an “affiliate” (as defined in Rule 405 promulgated under the
Securities Act) of any Issuer (4) if the holder is not a broker-dealer, that it is not engaged in,
and does not intend to engage in, the distribution of Exchange Notes (and related guarantees) and
(5) if the holder is a broker-dealer (a “Participating Broker-Dealer”) that it will receive
the Exchange Notes (and related guarantees) for its own account in exchange for Registrable
Securities that were acquired as a result of market-making or other trading activities, and that it
will deliver a prospectus in connection with any resale of the Exchange Notes (and related
guarantees).

          Upon consummation of the Exchange Offer in accordance with this Section 2, the provisions of
this Agreement shall continue to apply, mutatis mutandis, solely with respect to
Registrable Securities that are Private Exchange Notes (and related guarantees), Exchange Notes
(and related guarantees) as to which Section 2(c)(iv) is applicable and Exchange Notes (and related
guarantees) held by Participating Broker-Dealers, and the Issuers shall have no further obligation
to register Registrable Securities (other than Private Exchange Notes (and related guarantees) and
other than in respect of any Exchange Notes (and related guarantees) as to which clause 2(c)(iv)
hereof applies) pursuant to Section 3 hereof.

          No securities other than the Exchange Notes (and related guarantees) (and other notes (and
related guarantees)) of the Issuers that are identical in all material respects to the Notes (and
related guarantees) except that such other notes (and related guarantees) do not contain a
restrictive legend thereon (“Other Exchange Notes”)) shall be included in the Exchange
Offer Registration Statement. Notwithstanding the foregoing, the Issuers shall (to the extent
permitted by the Other Registration Rights Agreement or any similar registration rights agreement)
include in the Exchange Offer Registration Statement any Other Exchange Notes (and related
guarantees) to be offered in exchange for either the Other Securities or any other then outstanding
privately placed 5.60% Senior Notes due 2015 (and related guarantees) pursuant to the Other
Registration Rights Agreement or any similar registration rights agreement. If the Issuers are not
permitted by the Other Registration Rights Agreement or any similar registration rights agreement
to include these other exchange notes (and related guarantees) in the Exchange Offer Registration
Statement, the Issuer, (1) shall, in all material respects, treat the Exchange Offer Registration
Statement in the same manner as any other registration statement filed by the Issuers pursuant to
the Other Registration Rights Agreement or any similar registration rights agreement, including but
not limited to the following: (i) the timing of all filings; (ii) the disclosure contained therein;
(iii) the content of any amendments or supplements thereto; (iv) the timing of effectiveness
thereof; and (v) maintaining effectiveness thereof and (2) the Other Exchange Notes (and related
guarantees) covered by any other registration statement filed by the Issuers pursuant to (1) above
shall be offered as part of the Exchange Offer.

          (b) The Issuers shall include within the Prospectus contained in the Exchange Offer
Registration Statement a section entitled “Plan of Distribution,” reasonably acceptable to the
Initial Purchasers, which shall contain a summary statement of the positions taken or policies made
by the staff of the SEC with respect to the potential “underwriter” status of any Participating
Broker-Dealer that is the beneficial owner (as defined in Rule 13d-3 under the Exchange Act) of
Exchange Notes received by such Participating Broker-Dealer in the Exchange Offer, whether such
positions or policies have been publicly disseminated by the staff of the SEC

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or such positions or policies represent the prevailing views of the staff of the SEC. Such
“Plan of Distribution” section shall also expressly permit, to the extent permitted by applicable
policies and regulations of the SEC, the use of the Prospectus by all Persons subject to the
prospectus delivery requirements of the Securities Act, including, to the extent permitted by
applicable policies and regulations of the SEC, all Participating Broker-Dealers, and include a
statement describing the means by which Participating Broker-Dealers may resell the Exchange Notes
in compliance with the Securities Act.

          The Issuers shall use their best efforts to keep the Exchange Offer Registration Statement
effective and to amend and supplement the Prospectus contained therein in order to permit such
Prospectus to be lawfully delivered by all Persons subject to the prospectus delivery requirements
of the Securities Act for such period of time as is necessary to comply with applicable law in
connection with any resale of the Exchange Notes covered thereby; provided,
however, that such period shall not exceed 180 days after such Exchange Offer Registration
Statement is declared effective (or such longer period if extended pursuant to the last paragraph
of Section 5 hereof) (the “Applicable Period”).

          If, prior to consummation of the Exchange Offer, any Holder holds any Registrable Securities
acquired by it that have, or that are reasonably likely to be determined to have, the status of an
unsold allotment in an initial distribution, or any Holder is not entitled to participate in the
Exchange Offer, the Issuers upon the request of any such Holder shall simultaneously with the
delivery of the Exchange Notes in the Exchange Offer, issue and deliver to any such Holder, in
exchange (the “Private Exchange”) for such Registrable Securities held by any such Holder,
a like principal amount of notes (the “Private Exchange Notes”) of the Company, guaranteed
by the Guarantors, that are identical in all material respects to the Exchange Notes except for the
placement of a restrictive legend on such Private Exchange Notes. The Private Exchange Notes shall
be issued pursuant to the same indenture as the Exchange Notes and bear the same CUSIP number as
the Exchange Notes.

          In connection with the Exchange Offer, the Issuers shall:

     (i) mail, or cause to be mailed, to each Holder of record entitled to
participate in the Exchange Offer a copy of the Prospectus forming part of the
Exchange Offer Registration Statement, together with an appropriate letter of
transmittal and related documents;

     (ii) use their best efforts to keep the Exchange Offer open for acceptance for
not less than 30 days after the date that notice of the Exchange Offer is mailed to
Holders (or longer if required by applicable law);

     (iii) utilize the services of a depositary for the Exchange Offer with an
address in the Borough of Manhattan, The City of New York;

     (iv) permit Holders to withdraw tendered Registrable Securities at any time
prior to the close of business, New York time, on the last business day on which the
Exchange Offer shall remain open; and

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     (v) otherwise comply in all material respects with all applicable laws, rules
and regulations.

     As soon as practicable after the close of the Exchange Offer and the Private Exchange, if any,
the Issuers shall:

     (vi) accept for exchange all Registrable Securities validly tendered and not
validly withdrawn pursuant to the Exchange Offer and the Private Exchange, if any;

     (vii) deliver to the Trustee for cancellation all Registrable Securities so
accepted for exchange; and

     (viii) cause the Trustee to authenticate and deliver promptly to each Holder of
Securities, Exchange Notes or Private Exchange Notes (and related guarantees), as the
case may be, equal in principal amount to the Securities of such Holder so accepted
for exchange.

          The Exchange Notes (and related guarantees) and the Private Exchange Notes (and related
guarantees) shall be issued under (i) the Indenture or (ii) an indenture identical in all material
respects to the Indenture and which, in either case, has been qualified under the TIA or is exempt
from such qualification and shall provide that the Exchange Notes (and related guarantees) shall
not be subject to the transfer restrictions set forth in the Indenture. The Indenture or such
indenture shall provide that the Exchange Notes (and related guarantees), the Private Exchange
Notes (and related guarantees) and the Securities shall vote and consent together on all matters as
one class and that none of the Exchange Notes (and related guarantees), the Private Exchange Notes
(and related guarantees) or the Securities will have the right to vote or consent as a separate
class on any matter.

          (c) If, (i) because of any change in law or in currently prevailing interpretations by the SEC
staff, the Issuers are not permitted to effect the Exchange Offer, (ii) the Exchange Offer is not
consummated by November 24, 2005, (iii) in certain circumstances, certain holders of Private
Exchange Notes (and related guarantees) so request in writing to the Company, or (iv) in the case
of any Holder that tenders Securities in response to the Exchange Offer, such Holder does not
receive Exchange Notes on the date of the exchange that may be sold without restriction under state
and federal securities laws (other than due solely to the status of such Holder as an affiliate of
any of the Issuers within the meaning of the Securities Act), then in the case of each of clauses
(i) to and including (iv) of this sentence, the Issuers shall (a) promptly deliver to the Holders
and the Trustee written notice thereof (the “Shelf Notice”) and (b) at its sole expense and
as promptly as practicable shall file a Shelf Registration Statement pursuant to Section 3 hereof.

     3. Shelf Registration

          If at any time a Shelf Notice is delivered as contemplated by Section 2(c) hereof, then:

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          (a) Shelf Registration. The Issuers shall file with the SEC a Registration Statement
for an offering to be made on a continuous basis pursuant to Rule 415 covering all of the
Registrable Securities not exchanged in the Exchange Offer, Private Exchange Notes (and related
guarantees) and Exchange Notes (and related guarantees) as to which Section 2(c)(iv) is applicable
(the “Initial Shelf Registration Statement”). The Company shall use its best efforts to
file with the SEC the Initial Shelf Registration Statement on or before the applicable Filing Date.
The Initial Shelf Registration Statement shall be on Form S-1 or another appropriate form
permitting registration of such Registrable Securities for resale by Holders in the manner or
manners designated by them (including, without limitation, one or more underwritten offerings).

          The Issuers shall not permit any securities other than the Registrable Securities (and other
notes (and related guarantees) of the Issuers that are identical in all material respects to the
Registrable Securities (“Other Registrable Securities”)), to be included in the Initial
Shelf Registration Statement or any Subsequent Shelf Registration Statement (as defined below).
Notwithstanding the foregoing, the Issuers shall (to the extent permitted by the Other Registration
Rights Agreement or any similar registration rights agreement) include in the Initial Shelf
Registration Statement or any Subsequent Shelf Registration Statement the Other Securities and any
other then outstanding Other Registrable Securities pursuant to the Other Registration Rights
Agreement or any similar registration rights agreement. If the Issuers are not permitted by the
Other Registration Rights Agreement or any similar registration rights agreement to include these
Other Registrable Securities in the Initial Shelf Registration Statement or any Subsequent Shelf
Registration Statement, the Issuers shall, in all material respects, treat the Initial Shelf
Registration Statement or any Subsequent Shelf Registration Statement in the same manner as any
other similar registration statement filed by the Issuers pursuant to the Other Registration Rights
Agreement or any similar registration rights agreement, including but not limited to the following:
(i) the timing of all filings; (ii) the disclosure contained therein; (iii) the content of any
amendments or supplements thereto; (iv) the timing of effectiveness thereof; and (v) maintaining
effectiveness thereof.

          The Issuers shall use their best efforts to cause the Initial Shelf Registration Statement to
be declared effective under the Securities Act on or before the Effectiveness Date and to keep the
Initial Shelf Registration Statement continuously effective under the Securities Act until the date
which is two years from the date of this Agreement (the “Effectiveness Period”), or such
shorter period ending when (i) all Registrable Securities covered by the Initial Shelf Registration
Statement have been sold in the manner set forth and as contemplated in the Initial Shelf
Registration Statement or (ii) a Subsequent Shelf Registration Statement covering all of the
Registrable Securities covered by and not sold under the Initial Shelf Registration Statement or an
earlier Subsequent Shelf Registration Statement has been declared effective under the Securities
Act; provided, however, that the Effectiveness Period in respect of the Initial
Shelf Registration Statement shall be extended to the extent required to permit dealers to comply
with the applicable prospectus delivery requirements of Rule 174 under the Securities Act and as
otherwise provided herein. The Effectiveness Period (as defined in the Other Registration Rights
Agreement) with respect to the Initial Shelf Registration Statement for the Other Notes will
continue until the expiration of the Effectiveness Period under this Registration Rights Agreement.
The holders of the Other Notes are intended third-party beneficiaries of the preceding sentence
and the preceding sentence may be enforced by such Persons.

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          (b) Subsequent Shelf Registrations. If the Initial Shelf Registration Statement or
any Subsequent Shelf Registration Statement ceases to be effective for any reason at any time
during the Effectiveness Period (other than because of the sale of all of the securities registered
thereunder), the Company shall use its best efforts to obtain the prompt withdrawal of any order
suspending the effectiveness thereof, and in any event shall within 30 days of such cessation of
effectiveness amend the Initial Shelf Registration Statement in a manner to obtain the withdrawal
of the order suspending the effectiveness thereof, or file an additional “shelf” Registration
Statement pursuant to Rule 415 covering all of the Registrable Securities covered by and not sold
under the Initial Shelf Registration Statement or an earlier Subsequent Shelf Registration
Statement (each, a “Subsequent Shelf Registration Statement”). If a Subsequent Shelf
Registration Statement is filed, the Company shall use its best efforts to cause the Subsequent
Shelf Registration Statement to be declared effective under the Securities Act as soon as
practicable after such filing and to keep such subsequent Shelf Registration Statement continuously
effective for a period equal to the number of days in the Effectiveness Period less the aggregate
number of days during which the Initial Shelf Registration Statement or any Subsequent Shelf
Registration Statement was previously continuously effective. As used herein the term “Shelf
Registration Statement” means the Initial Shelf Registration Statement and any Subsequent Shelf
Registration Statement.

          (c) Supplements and Amendments. The Issuers shall promptly supplement and amend any
Shelf Registration Statement if required by the rules, regulations or instructions applicable to
the registration form used for such Shelf Registration Statement, if required by the Securities
Act, or if reasonably requested by the Holders of a majority in aggregate principal amount of the
Registrable Securities (or their counsel) covered by such Registration Statement or by any
underwriter of such Registrable Securities.

     4. Additional Interest

          (a) The Issuers and the Initial Purchasers agree that the Holders will suffer damages if the
Issuers fail to fulfill their obligations under Section 2 or Section 3 hereof and that it would not
be feasible to ascertain the extent of such damages with precision. Accordingly, the Issuers agree
to pay, as liquidated damages, additional interest on the Notes (“Additional Interest”)
under the circumstances and to the extent set forth below (each of which shall be given independent
effect):

     (i) if (A) neither the Exchange Offer Registration Statement nor the Initial
Shelf Registration Statement has been filed with the SEC on or before the applicable
Filing Date or (B) notwithstanding that the Issuers have consummated or will
consummate the Exchange Offer, the Issuers are required to file a Shelf Registration
Statement and such Shelf Registration Statement has not been filed with the SEC on
or before the Filing Date applicable thereto, or (C) the Issuers are required to pay
Additional Interest (as defined in the Other Registration Rights Agreement) pursuant
to Section 4(a)(i) of the Other Registration Rights Agreement, then, commencing on
the day after any such Filing Date, Additional Interest shall accrue on the
principal amount of the Registrable Securities at a rate of 0.25% per annum for the
first 90 days immediately following each such Filing

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Date, and such Additional Interest rate shall increase by an additional 0.25%
per annum at the beginning of each subsequent 90-day period; or

     (ii) if (A) neither the Exchange Offer Registration Statement nor the Initial
Shelf Registration Statement has been declared effective by the SEC on or before the
applicable Effectiveness Date or (B) notwithstanding that the Issuers have
consummated or will consummate the Exchange Offer, the Issuers are required to file
a Shelf Registration Statement and such Shelf Registration Statement has not been
declared effective by the SEC on or before the applicable Effectiveness Date with
respect to such Shelf Registration Statement, or (C) the Issuers are required to pay
Additional Interest (as defined in the Other Registration Rights Agreement) pursuant
to Section 4(a)(ii) of the Other Registration Rights Agreement, then, commencing on
the day after such Effectiveness Date, Additional Interest shall accrue on the
principal amount of the Registrable Securities at a rate of 0.25% per annum for the
first 90 days immediately following the day after such Effectiveness Date, and such
Additional Interest rate shall increase by an additional 0.25% per annum at the
beginning of each subsequent 90-day period; or

     (iii) if (A) the Issuers have not exchanged Exchange Notes (and related
guarantees) for all Registrable Securities validly tendered in accordance with the
terms of the Exchange Offer on or before November 24, 2005, (B) if applicable, a
Shelf Registration Statement has been declared effective and such Shelf Registration
Statement ceases to be effective at any time during the Effectiveness Period, or (C)
the Issuers are required to pay Additional Interest (as defined in the Other
Registration Rights Agreement) pursuant to Section 4(a)(iii) of the Other
Registration Rights Agreement, then, Additional Interest shall accrue on the
principal amount of the Registrable Securities at a rate of 0.25% per annum for the
first 90 days commencing on (x) November 24, 2005, in the case of (A) above, or (y)
the day such Shelf Registration Statement ceases to be effective in the case of (B)
above or (z) the date the Additional Interest (as defined in the Other Registration
Rights Agreements) begins to accrue under the terms of the Other Registration Rights
Agreement in the case of (C) above, and such Additional Interest rate shall increase
by an additional 0.25% per annum at the beginning of each such subsequent 90-day
period;

provided, however, that Additional Interest on the Notes may not under any
circumstance accrue under more than one of the foregoing clauses (i), (ii) and (iii) of this
Section 4 and the rate at which Additional Interest accrues on the Notes as a result of the
provisions of clauses (i), (ii) and (iii) of this Section 4 may not exceed in the aggregate 1.0%
per annum; provided further, that (1) upon the filing of the applicable Exchange
Offer Registration Statement or the applicable Shelf Registration Statement as required hereunder
(in the case of clause (i) of this Section 4), (2) upon the effectiveness of the Exchange Offer
Registration Statement or the applicable Shelf Registration Statement as required hereunder (in the
case of clause (ii) of this Section 4), or (3) upon the exchange of the Exchange Notes (and related
guarantees) for all Registrable Securities tendered (in the case of clause (iii)(A) of this Section
4), or upon the effectiveness of a Subsequent Shelf Registration Statement in the case of Shelf
Registration Statement which had

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ceased to remain effective (in the case of clause (iii)(B) of this Section 4), Additional Interest
on the Registrable Notes as a result of such clause (or the relevant subclause thereof), as the
case may be, shall cease to accrue. Additional Interest on the Registrable Notes as a result of
clauses (i)(C), (ii)(C) or (iii)(C) of this Section 4 shall cease to accrue if Additional Interest
(as defined in the Other Registration Rights Agreement) ceases to accrue under the Other
Registration Rights Agreement. Additional Interest (as defined in the Other Registration Rights
Agreement) will accrue on the Other Notes if and for so long as Additional Interest accrues under
this Registration Rights Agreement. The holders of the Other Notes are intended third-party
beneficiaries of the preceding sentence and the preceding sentence may be enforced by such Persons.

          (b) The Issuers shall notify the Trustee within three business days after each and every date
on which an event occurs in respect of which Additional Interest is required to be paid (an
“Event Date”), which notice shall also be at least three business days prior to the date of
any payment to be made in accordance with the following sentence. Any amounts of Additional
Interest due pursuant to (a)(i), (a)(ii) or (a)(iii) of this Section 4 will be payable in cash
simultaneously with, and to the same persons entitled to receive, stated interest on the
Registrable Notes, commencing with the first such payment of interest occurring after any such
Additional Interest commences to accrue. The amount of Additional Interest payable with respect to
Registrable Notes will be determined by multiplying the applicable Additional Interest rate by the
principal amount of the Registrable Notes, multiplied by a fraction, the numerator of which is the
number of days such Additional Interest rate was applicable during such period (determined on the
basis of a 360-day year comprised of twelve 30-day months and, in the case of a partial month, the
actual number of days elapsed), and the denominator of which is 360.

     5. Registration Procedures

          In connection with the filing of any Registration Statement pursuant to Sections 2 or 3
hereof, the Issuers shall effect such registrations to permit the sale of the securities covered
thereby in accordance with the intended method or methods of disposition thereof, and pursuant
thereto and in connection with any Registration Statement filed by the Issuers hereunder each of
the Issuers shall:

          (a) Prepare and file with the SEC before the applicable Filing Date, a Registration Statement
or Registration Statements as prescribed by Sections 2 or 3 hereof, and use its best efforts to
cause each such Registration Statement to become effective and remain effective as provided herein;
provided, however, that, if (1) such filing is pursuant to Section 3 hereof, or (2)
a Prospectus contained in the Exchange Offer Registration Statement filed pursuant to Section 2
hereof is required to be delivered under the Securities Act by any Participating Broker-Dealer who
seeks to sell Exchange Notes (and related guarantees) during the Applicable Period relating
thereto, before filing any Registration Statement or Prospectus or any amendments or supplements
thereto, the Issuers shall furnish to and afford the Holders of the Registrable Securities included
in such Registration Statement or each such Participating Broker-Dealer, as the case may be, their
counsel and the managing underwriters, if any, a reasonable opportunity to review copies of all
such documents (including copies of any documents to be incorporated by reference therein and all
exhibits thereto) proposed to be filed (in each case at least five days prior to such filing, or
such later date as is reasonable under the circumstances).

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The Issuers shall not file any Registration Statement or Prospectus or any amendments or
supplements thereto if the Holders of a majority in aggregate principal amount of the Registrable
Securities included in such Registration Statement, or any such Participating Broker-Dealer, as the
case may be, their counsel, or the managing underwriters, if any, shall reasonably object.

          (b) Prepare and file with the SEC such amendments and post-effective amendments to each Shelf
Registration Statement or Exchange Offer Registration Statement, as the case may be, as may be
necessary to keep such Registration Statement continuously effective for the Effectiveness Period
or the Applicable Period, as the case may be; cause the related Prospectus to be supplemented by
any Prospectus supplement required by applicable law, and as so supplemented to be filed pursuant
to Rule 424 (or any similar provisions then in force) promulgated under the Securities Act; and
comply with the provisions of the Securities Act and the Exchange Act applicable to each of them
with respect to the disposition of all securities covered by such Registration Statement as so
amended or in such Prospectus as so supplemented and with respect to the subsequent resale of any
securities being sold by a Participating Broker-Dealer covered by any such Prospectus. The Issuers
shall be deemed not to have used their best efforts to keep a Registration Statement effective
during the Effectiveness Period or the Applicable Period, as the case may be, relating thereto, if
any of the Issuers voluntarily takes any action that would result in selling Holders of the
Registrable Securities covered thereby or Participating Broker-Dealers seeking to sell Exchange
Notes (and related guarantees) not being able to sell such Registrable Securities or such Exchange
Notes (and related guarantees) during that period unless such action is required by applicable law
or permitted by this Agreement.

          (c) If (1) a Shelf Registration Statement is filed pursuant to Section 3 hereof, or (2) a
Prospectus contained in the Exchange Offer Registration Statement filed pursuant to Section 2
hereof is required to be delivered under the Securities Act by any Participating Broker-Dealer who
seeks to sell Exchange Notes (and related guarantees) during the Applicable Period relating thereto
from whom any of the Issuers has received written notice that it will be a Participating
Broker-Dealer in the Exchange Offer, notify the selling Holders of Registrable Securities, or each
such Participating Broker-Dealer, as the case may be, their counsel and the managing underwriters,
if any, promptly (but in any event within one day), and confirm such notice in writing, (i) when a
Prospectus or any Prospectus supplement or post-effective amendment has been filed, and, with
respect to a Registration Statement or any post-effective amendment, when the same has become
effective under the Securities Act (including in such notice a written statement that any Holder
may, upon request, obtain, at the sole expense of the Issuers, one conformed copy of such
Registration Statement or post-effective amendment including financial statements and schedules,
documents incorporated or deemed to be incorporated by reference and exhibits), (ii) of the
issuance by the SEC of any stop order suspending the effectiveness of a Registration Statement or
of any order preventing or suspending the use of any preliminary prospectus or the initiation of
any proceedings for that purpose, (iii) if at any time when a prospectus is required by the
Securities Act to be delivered in connection with sales of the Registrable Securities or resales of
Exchange Notes (and related guarantees) by Participating Broker-Dealers, the representations and
warranties of the Issuers contained in any agreement (including any underwriting agreement)
contemplated by Section 5(l) hereof cease to be true and correct in all material respects, (iv) of
the receipt by any of the Issuers of any notification with respect to the suspension of the
qualification or exemption from qualification of a Registration Statement or any of the Registrable
Securities or the Exchange

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Notes (and related guarantees) to be sold by any Participating Broker-Dealer for offer or sale
in any jurisdiction, or the initiation or threatening of any proceeding for such purpose, (v) of
the happening of any event, the existence of any condition or any information becoming known that
makes any statement made in such Registration Statement or related Prospectus or any document
incorporated or deemed to be incorporated therein by reference untrue in any material respect or
that requires the making of any changes in or amendments or supplements to such Registration
Statement, Prospectus or documents so that, in the case of the Registration Statement, it will not
contain any untrue statement of a material fact or omit to state any material fact required to be
stated therein or necessary to make the statements therein not misleading, and that in the case of
the Prospectus, it will not contain any untrue statement of a material fact or omit to state any
material fact required to be stated therein or necessary to make the statements therein, in light
of the circumstances under which they were made, not misleading, and (vi) of the Issuers’
determination that a post-effective amendment to a Registration Statement would be appropriate.

          (d) If (1) a Shelf Registration Statement is filed pursuant to Section 3 hereof, or (2) a
Prospectus contained in the Exchange Offer Registration Statement filed pursuant to Section 2
hereof is required to be delivered under the Securities Act by any Participating Broker-Dealer who
seeks to sell Exchange Notes (and related guarantees) during the Applicable Period, use its best
efforts to prevent the issuance of any order suspending the effectiveness of the Registration
Statement or of any order preventing or suspending the use of the Prospectus or suspending the
qualification (or exemption from qualification) of any of the Registrable Securities or the
Exchange Notes (and related guarantees) to be sold by any Participating Broker-Dealer, for sale in
any jurisdiction, and, if any such order is issued, to use its best efforts to obtain the
withdrawal of any such order at the earliest possible moment.

          (e) If a Shelf Registration Statement is filed pursuant to Section 3 and if requested by the
managing underwriter or underwriters (if any), the Holders of a majority in aggregate principal
amount of the Registrable Securities being sold in connection with an underwritten offering or any
Participating Broker-Dealer, (i) as promptly as practicable incorporate in a prospectus supplement
or post-effective amendment such information as the managing underwriter or underwriters (if any),
such Holders, any Participating Broker-Dealer or counsel for any of them reasonably request to be
included therein, (ii) make all required filings of such prospectus supplement or such
post-effective amendment as soon as practicable after the Company has received notification of the
matters to be incorporated in such prospectus supplement or post-effective amendment, and (iii)
supplement or make amendments to such Registration Statement.

          (f) If (1) a Shelf Registration Statement is filed pursuant to Section 3 hereof, or (2) a
Prospectus contained in the Exchange Offer Registration Statement filed pursuant to Section 2
hereof is required to be delivered under the Securities Act by any Participating Broker-Dealer who
seeks to sell Exchange Notes (and related guarantees) during the Applicable Period, furnish to each
selling Holder of Registrable Securities and to each such Participating Broker-Dealer who so
requests and to their respective counsel and each managing underwriter, if any, at the sole expense
of the Issuers, one conformed copy of the Registration Statement or Registration Statements and
each post-effective amendment thereto, including financial statements and schedules, and, if
requested, all documents incorporated or deemed to be incorporated therein by reference and all
exhibits.

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          (g) If (1) a Shelf Registration Statement is filed pursuant to Section 3 hereof, or (2) a
Prospectus contained in the Exchange Offer Registration Statement filed pursuant to Section 2
hereof is required to be delivered under the Securities Act by any Participating Broker-Dealer who
seeks to sell Exchange Notes (and related guarantees) during the Applicable Period, deliver to each
selling Holder of Registrable Securities, or each such Participating Broker-Dealer, as the case may
be, their respective counsel, and the underwriters, if any, at the sole expense of the Issuers, as
many copies of the Prospectus or Prospectuses (including each form of preliminary prospectus) and
each amendment or supplement thereto and any documents incorporated by reference therein as such
Persons may reasonably request; and, subject to the last paragraph of this Section 5, the Issuers
hereby consent to the use of such Prospectus and each amendment or supplement thereto by each of
the selling Holders of Registrable Securities or each such Participating Broker-Dealer, as the case
may be, and the underwriters or agents, if any, and dealers, if any, in connection with the
offering and sale of the Registrable Securities covered by, or the sale by Participating
Broker-Dealers of the Exchange Notes (and related guarantees) pursuant to, such Prospectus and any
amendment or supplement thereto.

          (h) Prior to any public offering of Registrable Securities or Exchange Notes (and related
guarantees) or any delivery of a Prospectus contained in the Exchange Offer Registration Statement
by any Participating Broker-Dealer who seeks to sell Exchange Notes (and related guarantees) during
the Applicable Period, use its best efforts to register or qualify, and to cooperate with the
selling Holders of Registrable Securities or each such Participating Broker-Dealer, as the case may
be, the managing underwriter or underwriters, if any, and their respective counsel in connection
with the registration or qualification (or exemption from such registration or qualification) of
such Registrable Securities for offer and sale under the securities or Blue Sky laws of such
jurisdictions within the United States as any selling Holder, Participating Broker-Dealer, or the
managing underwriter or underwriters reasonably request in writing; provided,
however, that where Exchange Notes (and related guarantees) held by Participating
Broker-Dealers or Registrable Securities are offered other than through an underwritten offering,
the Issuers agree to cause their counsel to perform Blue Sky investigations and file registrations
and qualifications required to be filed pursuant to this Section 5(h), keep each such registration
or qualification (or exemption therefrom) effective during the period such Registration Statement
is required to be kept effective and do any and all other acts or things reasonably necessary or
advisable to enable the disposition in such jurisdictions of the Exchange Notes (and related
guarantees) held by Participating Broker-Dealers or the Registrable Securities covered by the
applicable Registration Statement; provided, however, that none of the Issuers
shall be required to (A) qualify generally to do business in any jurisdiction where it is not then
so qualified, (B) take any action that would subject it to general service of process in any such
jurisdiction where it is not then so subject or (C) subject itself to taxation in excess of a
nominal dollar amount in any such jurisdiction where it is not then so subject.

          (i) If a Shelf Registration Statement is filed pursuant to Section 3 hereof, cooperate with
the selling Holders of Registrable Securities and the managing underwriter or underwriters, if any,
to facilitate the timely preparation and delivery of certificates representing Registrable Notes to
be sold, which certificates shall not bear any restrictive legends and shall be in a form eligible
for deposit with The Depository Trust Company; and enable such Registrable Notes to be in such
denominations permitted by the Indenture and registered in such names as the managing underwriter
or underwriters, if any, or Holders may request.

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          (j) If (1) a Shelf Registration Statement is filed pursuant to Section 3 hereof, or (2) a
Prospectus contained in the Exchange Offer Registration Statement filed pursuant to Section 2
hereof is required to be delivered under the Securities Act by any Participating Broker-Dealer who
seeks to sell Exchange Notes (and related guarantees) during the Applicable Period, upon the
occurrence of any event contemplated by paragraph 5(c)(v) or 5(c)(vi) hereof, as promptly as
practicable prepare and (subject to Section 5(a) hereof) file with the SEC, at the sole expense of
the Issuers, a supplement or post-effective amendment to the Registration Statement or a supplement
to the related Prospectus or any document incorporated or deemed to be incorporated therein by
reference, or file any other required document so that, as thereafter delivered to the purchasers
of the Registrable Securities being sold thereunder or to the purchasers of the Exchange Notes (and
related guarantees) to whom such Prospectus will be delivered by a Participating Broker-Dealer, any
such Prospectus will not contain an untrue statement of a material fact or omit to state a material
fact required to be stated therein or necessary to make the statements therein, in light of the
circumstances under which they were made, not misleading.

          (k) Prior to the effective date of the first Registration Statement relating to the
Registrable Securities, (i) provide the Trustee with certificates for the Registrable Notes in a
form eligible for deposit with The Depository Trust Company and (ii) provide a CUSIP number for the
Registrable Notes.

          (l) In connection with any underwritten offering of Registrable Securities pursuant to a Shelf
Registration Statement, enter into an underwriting agreement which is customary in underwritten
offerings of debt securities similar to the Registrable Securities in form and substance reasonably
satisfactory to the Issuers and take all such other actions as are reasonably requested by the
managing underwriter or underwriters in order to expedite or facilitate the registration or the
disposition of such Registrable Securities and, in such connection, (i) make such representations
and warranties to, and covenants with, the underwriters with respect to the business of the Issuers
(including any acquired business, properties or entity, if applicable) and the Registration
Statement, Prospectus and documents, if any, incorporated or deemed to be incorporated by reference
therein, in each case, as are customarily made by issuers to underwriters in underwritten offerings
of debt securities similar to the Registrable Securities, and confirm the same in writing if and
when requested in form and substance reasonably satisfactory to the Issuers; (ii) obtain the
written opinions of counsel to the Issuers and written updates thereof in form, scope and substance
reasonably satisfactory to the managing underwriter or underwriters, addressed to the underwriters
covering the matters customarily covered in opinions reasonably requested in underwritten offerings
and such other matters as may be reasonably requested by the managing underwriter or underwriters;
(iii) obtain “cold comfort” letters and updates thereof in form, scope and substance reasonably
satisfactory to the managing underwriter or underwriters from the independent certified public
accountants of the Issuers (and, if necessary, any other independent certified public accountants
of the Issuers, or of any business or entity acquired by the Issuers for which financial statements
and financial data are, or are required to be, included or incorporated by reference in the
Registration Statement), addressed to each of the underwriters, such letters to be in customary
form and covering matters of the type customarily covered in “cold comfort” letters in connection
with underwritten offerings of debt securities similar to the Registrable Securities and such other
matters as are reasonably requested by the managing underwriter or underwriters as permitted by

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the Statement on Auditing Standards No. 72, as amended by the Statement on Auditing Standards
No. 76; and (iv) if an underwriting agreement is entered into, the same shall contain
indemnification provisions and procedures no less favorable to the sellers and underwriters, if
any, than those set forth in Section 7 hereof (or such other provisions and procedures acceptable
to Holders of a majority in aggregate principal amount of Registrable Securities covered by such
Registration Statement and the managing underwriter or underwriters or agents, if any). The above
shall be done at each closing under such underwriting agreement, or as and to the extent required
thereunder.

          (m) If (1) a Shelf Registration Statement is filed pursuant to Section 3 hereof, or (2) a
Prospectus contained in the Exchange Offer Registration Statement filed pursuant to Section 2
hereof is required to be delivered under the Securities Act by any Participating Broker-Dealer who
seeks to sell Exchange Notes (and related guarantees) during the Applicable Period, make available
for inspection by any selling Holder of such Registrable Securities being sold, or each such
Participating Broker-Dealer, as the case may be, any underwriter participating in any such
disposition of Registrable Securities, if any, and any attorney, accountant or other agent retained
by any such selling Holder or each such Participating Broker-Dealer, as the case may be, or
underwriter (collectively, the “Inspectors”), at the offices where normally kept, during
reasonable business hours, all financial and other records, pertinent corporate documents and
instruments of the Issuers and subsidiaries of the Issuers (collectively, the “Records”) as
shall be reasonably necessary to enable them to exercise any applicable due diligence
responsibilities, and cause the officers, directors and employees of the Issuers and any of their
respective subsidiaries to supply all information reasonably requested by any such Inspector in
connection with such Registration Statement and Prospectus. Each Inspector shall agree in writing
that it will keep the Records confidential and that it will not disclose any of the Records that
any of the Issuers determines, in good faith, to be confidential and notifies the Inspectors in
writing are confidential unless (i) the disclosure of such Records is necessary to avoid or correct
a material misstatement or material omission in such Registration Statement or Prospectus, (ii) the
release of such Records is ordered pursuant to a subpoena or other order from a court of competent
jurisdiction, or (iii) the information in such Records has been made generally available to the
public; provided, however, that prior notice shall be provided as soon as
practicable to any of the Issuers of the potential disclosure of any information by such Inspector
pursuant to clauses (i) or (ii) of this sentence to permit the Issuers to obtain a protective order
(or waive the provisions of this paragraph (m)) and that such Inspector shall take such actions as
are reasonably necessary to protect the confidentiality of such information (if practicable) to the
extent such action is otherwise not inconsistent with, an impairment of or in derogation of the
rights and interests of the Holder or any Inspector. If, in the course of performing due
diligence, any Inspector becomes aware of material non public information about the Company and its
subsidiaries, the Inspector will not, and will take all steps reasonably necessary to ensure that
anyone to whom the Inspector discloses the material non public information will not trade in any
securities of the Company until the information becomes public (whether through inclusion in the
Shelf Registration Statement or Exchange Offer Registration Statement or otherwise) or the
information ceases to be material.

          (n) Provide an indenture trustee for the Registrable Securities or the Exchange Notes (and
related guarantees), as the case may be, and cause the Indenture or the trust indenture provided
for in Section 2(a) hereof, as the case may be, to be qualified under the TIA not later

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than the effective date of the first Registration Statement relating to the Registrable
Securities; and in connection therewith, cooperate with the trustee under any such indenture and
the Holders of the Registrable Securities, to effect such changes to such indenture as may be
required for such indenture to be so qualified in accordance with the terms of the TIA; and
execute, and use their best efforts to cause such trustee to execute, all documents as may be
required to effect such changes, and all other forms and documents required to be filed with the
SEC to enable such indenture to be so qualified in a timely manner.

          (o) Comply with all applicable rules and regulations of the SEC and make generally available
to its securityholders with regard to any applicable Registration Statement, a consolidated
earnings statement satisfying the provisions of Section 11(a) of the Securities Act and Rule 158
thereunder (or any similar rule promulgated under the Securities Act) no later than 45 days after
the end of any fiscal quarter (or 90 days after the end of any 12-month period if such period is a
fiscal year) (i) commencing at the end of any fiscal quarter in which Registrable Securities are
sold to underwriters in a firm commitment or best efforts underwritten offering and (ii) if not
sold to underwriters in such an offering, commencing on the first day of the first fiscal quarter
of the Company after the effective date of a Registration Statement, which statements shall cover
said 12-month periods.

          (p) Upon consummation of the Exchange Offer or a Private Exchange, obtain an opinion of
counsel to the Company, in a form customary for underwritten transactions, addressed to the Trustee
for the benefit of all Holders of Registrable Securities participating in the Exchange Offer or the
Private Exchange, as the case may be, that the Exchange Notes (and related guarantees) or Private
Exchange Notes (and related guarantees), as the case may be, and the related indenture constitute
legal, valid and binding obligations of the Company, enforceable against it in accordance with
their respective terms, subject to customary exceptions and qualifications.

          (q) If the Exchange Offer or a Private Exchange is to be consummated, upon delivery of the
Registrable Securities by Holders to the Company (or to such other Person as directed by the
Issuers) to be exchanged for Exchange Notes (and related guarantees) or Private Exchange Notes (and
related guarantees), as the case may be, the Issuers shall mark, or cause to be marked, on such
Registrable Notes that such Registrable Notes are being canceled in exchange for Exchange Notes
(and related guarantees) or Private Exchange Notes (and related guarantees), as the case may be; in
no event shall such Registrable Notes be marked as paid or otherwise satisfied.

          (r) Cooperate with each seller of Registrable Securities covered by any Registration Statement
and each underwriter, if any, participating in the disposition of such Registrable Securities and
their respective counsel in connection with any filings required to be made with the National
Association of Securities Dealers, Inc. (the “NASD”).

          (s) Use its best efforts to take all other steps reasonably necessary to effect the
registration of the Exchange Notes (and related guarantees) and/or Registrable Securities covered
by a Registration Statement contemplated hereby.

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          The Issuers may require each seller of Registrable Securities as to which any registration is
being effected to furnish to the Issuers such information regarding such seller and the
distribution of such Registrable Securities as the Issuers may, from time to time, reasonably
request. The Issuers may exclude from such registration the Registrable Securities of any seller
so long as such seller fails to furnish such information within a reasonable time after receiving
such request. Each seller as to which any Shelf Registration is being effected agrees to furnish
promptly to the Issuers all information required to be disclosed in order to make the information
previously furnished to the Issuers by such seller not materially misleading.

          If any Registration Statement refers to any Holder by name or otherwise as the holder of any
securities of the Company, then such Holder shall have the right to require (i) the insertion
therein of language, in form and substance reasonably satisfactory to such Holder, to the effect
that the holding by such Holder of such securities is not to be construed as a recommendation by
such Holder of the investment quality of the securities covered thereby and that such holding does
not imply that such Holder will assist in meeting any future financial requirements of the Company,
or (ii) in the event that such reference to such Holder by name or otherwise is not required by the
Securities Act or any similar federal statute then in force, the deletion of the reference to such
Holder in any amendment or supplement to the Registration Statement filed or prepared subsequent to
the time that such reference ceases to be required.

          Each Holder of Registrable Securities and each Participating Broker-Dealer agrees by its
acquisition of such Registrable Securities or of Exchange Notes (and related guarantees) to be sold
by such Participating Broker-Dealer, as the case may be, that, upon actual receipt of any notice
from the Company of the happening of any event of the kind described in Section 5(c)(ii), 5(c)(iv),
5(c)(v), or 5(c)(vi) hereof, such Holder will forthwith discontinue disposition of such Registrable
Securities covered by such Registration Statement or Prospectus or Exchange Notes (and related
guarantees) to be sold by such Holder or Participating Broker-Dealer, as the case may be, until
such Holder’s or Participating Broker-Dealer’s receipt of the copies of the supplemented or amended
Prospectus contemplated by Section 5(j) hereof, or until it is advised in writing (an
“Advice”) by the Issuers that the use of the applicable Prospectus may be resumed, and has
received copies of any amendments or supplements thereto. In the event that the Issuers shall give
any such notice, the Applicable Period shall be extended by the number of days from and including
the date of the giving of each such notice to and including the date when each seller of
Registrable Securities covered by such Registration Statement or Exchange Notes (and related
guarantees) to be sold by such Participating Broker-Dealer, as the case may be, shall have received
(x) the copies of the supplemented or amended Prospectus contemplated by Section 5(j) hereof or (y)
an Advice with respect to said notice.

     6. Registration Expenses

          All fees and expenses incident to the performance of or compliance with this Agreement by the
Issuers (other than any underwriting discounts or commissions) shall be borne by the Company
whether or not the Exchange Offer Registration Statement or any Shelf Registration Statement is
filed or becomes effective or the Exchange Offer is consummated, including, without limitation, (i)
all registration and filing fees (including, without limitation, (A) fees with respect to filings
required to be made with the NASD in connection with an underwritten offering and (B) reasonable
fees and expenses of compliance with state securities or

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Blue Sky laws (including, without limitation, fees and disbursements of counsel in connection
with Blue Sky qualifications of the Registrable Securities or Exchange Notes (and related
guarantees) and determination of the eligibility of the Registrable Securities or Exchange Notes
(and related guarantees) for investment under the laws of the jurisdictions (x) where the holders
of Registrable Securities are located, in the case of the Exchange Notes (and related guarantees),
or (y) as provided in Section 5(h) hereof, in the case of Registrable Securities or Exchange Notes
(and related guarantees) to be sold by a Participating Broker-Dealer during the Applicable
Period)), (ii) printing expenses, including, without limitation, expenses of printing certificates
for Registrable Notes or Exchange Notes in a form eligible for deposit with The Depository Trust
Company and of printing prospectuses if the printing of prospectuses is requested by the managing
underwriter or underwriters, if any, by the Holders of a majority in aggregate principal amount of
the Registrable Securities included in any Registration Statement or in respect of Registrable
Securities or Exchange Notes (and related guarantees) to be sold by any Participating Broker-Dealer
during the Applicable Period, as the case may be, (iii) messenger, telephone and delivery expenses,
(iv) fees and disbursements of counsel for the Issuers and reasonable fees and disbursements of one
firm of special counsel for the sellers of Registrable Securities, (v) fees and disbursements of
all independent certified public accountants referred to in Section 5(l)(iii) hereof (including,
without limitation, the expenses of any special audit and “cold comfort” letters required by or
incident to such performance), (vi) Securities Act liability insurance, if the Issuers desire such
insurance, (vii) fees and expenses of all other Persons retained by the Issuers, (viii) internal
expenses of the Issuers (including, without limitation, all salaries and expenses of officers and
employees of the Issuers performing legal or accounting duties), (ix) the expense of any annual
audit, (x) any fees and expenses incurred in connection with the listing of the securities to be
registered on any securities exchange, and the obtaining of a rating of the securities, in each
case, if applicable, and (xi) the expenses relating to printing, word processing and distributing
all Registration Statements, underwriting agreements, indentures and any other documents necessary
in order to comply with this Agreement.

     7. Indemnification

          (a) Each of the Issuers agree, jointly and severally, to indemnify and hold harmless each
Holder of Registrable Securities and each Participating Broker-Dealer selling Exchange Notes (and
related guarantees) during the Applicable Period, the affiliates, officers, directors,
representatives, employees and agents of each such Person, and each Person, if any, who controls
any such Person within the meaning of either Section 15 of the Securities Act or Section 20 of the
Exchange Act (each, a “Participant”), from and against any and all losses, claims, damages,
judgments, liabilities and expenses (including, without limitation, the reasonable legal fees and
other expenses actually incurred in connection with any suit, action or proceeding or any claim
asserted) caused by, arising out of or based upon any untrue statement or alleged untrue statement
of a material fact contained in any Registration Statement (or any amendment thereto) or Prospectus
(as amended or supplemented if any of the Issuers shall have made any amendments or supplements
thereto) or any preliminary prospectus, or caused by, arising out of or based upon any omission or
alleged omission to state therein a material fact required to be stated therein or necessary to
make the statements therein, in the case of the Prospectus in light of the circumstances under
which they were made, not misleading, except insofar as such losses, claims, damages or
liabilities are caused by any untrue statement or omission or alleged untrue statement or omission
made in reliance upon and in conformity with

-20-

 

information relating to any Participant, any underwriter, or the manner in which securities
are to be distributed, furnished to the Issuers in writing by such Participant or an underwriter
expressly for use therein.

          (b) Each Participant agrees, severally and not jointly, to indemnify and hold harmless the
Issuers, their respective affiliates, officers, directors, representatives, employees and agents
and each Person who controls the Issuers within the meaning of Section 15 of the Securities Act or
Section 20 of the Exchange Act to the same extent (but on a several, and not joint, basis) as the
foregoing indemnity from the Issuers to each Participant, but only with reference to information
relating to such Participant or the manner in which securities are to be distributed by such
Participant or someone acting on such Participant’s behalf, furnished to the Issuers in writing by
such Participant expressly for use in any Registration Statement or Prospectus, any amendment or
supplement thereto, or any preliminary prospectus. The liability of any Participant under this
paragraph shall in no event exceed the proceeds received by such Participant from sales of
Registrable Securities or Exchange Notes (and related guarantees) giving rise to such obligations.

          (c) If any suit, action, proceeding (including any governmental or regulatory investigation),
claim or demand shall be brought or asserted against any Person in respect of which indemnity may
be sought pursuant to either of the two preceding paragraphs, such Person (the “Indemnified
Person”) shall promptly notify the Persons against whom such indemnity may be sought (the
“Indemnifying Persons”) in writing, and the Indemnifying Persons, upon request of the
Indemnified Person, shall retain counsel reasonably satisfactory to the Indemnified Person to
represent the Indemnified Person and any others the Indemnifying Persons may reasonably designate
(which may include the Indemnifying Persons, unless representation of the Indemnifying Persons by
the same counsel would be inappropriate due to actual or potential differing interests between
them) in such proceeding and shall pay the fees and expenses actually incurred by such counsel
related to such proceeding; provided, however, that the failure to so notify the
Indemnifying Persons (i) will not relieve it from any liability under paragraph (a) or (b) above
unless and to the extent such failure results in the forfeiture by the Indemnifying Person of
substantial rights and defenses and (ii) will not, in any event, relieve the Indemnifying Person
from any obligations to any Indemnified Person other than the indemnification obligation provided
in paragraphs (a) and (b) above. In any such proceeding, any Indemnified Person shall have the
right to retain its own counsel, but the fees and expenses of such counsel shall be at the expense
of such Indemnified Person unless (i) the Indemnifying Persons and the Indemnified Person shall
have mutually agreed to the contrary, (ii) the Indemnifying Persons shall have failed within a
reasonable period of time to retain counsel reasonably satisfactory to the Indemnified Person or
(iii) the named parties in any such proceeding (including any impleaded parties) include both any
Indemnifying Person and the Indemnified Person or any affiliate thereof and representation of both
parties by the same counsel would be inappropriate due to actual or potential differing interests
between them. It is understood that, unless there exists a conflict among the Indemnified Persons,
the Indemnifying Persons shall not, in connection with such proceeding or separate but
substantially similar related proceeding in the same jurisdiction arising out of the same general
allegations, be liable for the fees and expenses of more than one separate firm (in addition to any
local counsel) for all Indemnified Persons, and that all such fees and expenses shall be reimbursed
promptly as they are incurred. Any such separate firm for the Participants against whom a suit,
action, proceeding, claim or demand is brought or asserted and

-21-

 

control Persons of such Participants shall be designated in writing by Participants who sold a
majority in interest of Registrable Securities and Exchange Notes (and related guarantees) sold by
all such Participants, and any such separate firm for the Issuers, their affiliates, officers,
directors, representatives, employees and agents and such control Persons of the Issuers shall be
designated in writing by the Issuers.

          The Indemnifying Persons shall not be liable for any settlement of any proceeding effected
without their prior written consent, but if settled with such consent or if there be a final
non-appealable judgment for the plaintiff for which any Indemnified Persons are entitled to
indemnification pursuant to this Agreement, each of the Indemnifying Persons agrees to indemnify
and hold harmless each Indemnified Person from and against any loss or liability by reason of such
settlement or judgment. No Indemnifying Person shall, without the prior written consent of the
Indemnified Persons, effect any settlement or compromise of any pending or threatened proceeding in
respect of which any Indemnified Person is or could have been a party, or indemnity could have been
sought hereunder by such Indemnified Person, unless such settlement (A) includes an unconditional
written release of such Indemnified Person, in form and substance reasonably satisfactory to such
Indemnified Person, from all liability on claims that are the subject matter of such proceeding and
(B) does not include any statement as to an admission of fault, culpability or failure to act by or
on behalf of such Indemnified Person.

          (d) If the indemnification provided for in the first and second paragraphs of this Section 7
is for any reason unavailable to, or insufficient to hold harmless, an Indemnified Person in
respect of any losses, claims, damages or liabilities referred to therein, then each Indemnifying
Person under such paragraphs, in lieu of indemnifying such Indemnified Person thereunder and in
order to provide for just and equitable contribution, shall contribute to the amount paid or
payable by such Indemnified Person as a result of such losses, claims, damages or liabilities in
such proportion as is appropriate to reflect (i) the relative benefits received by the Indemnifying
Person or Persons on the one hand and the Indemnified Person or Persons on the other from the
applicable offering of Registrable or Exchanged Notes or (ii) if the allocation provided by the
foregoing clause (i) is not permitted by applicable law, not only such relative benefits but also
the relative fault of the Indemnifying Person or Persons on the one hand and the Indemnified Person
or Persons on the other in connection with the statements or omissions or alleged statements or
omissions that resulted in such losses, claims, damages or liabilities (or actions in respect
thereof) as well as any other relevant equitable considerations. The relative fault of the parties
shall be determined by reference to, among other things, whether the untrue or alleged untrue
statement of a material fact or the omission or alleged omission to state a material fact relates
to information supplied by the Company on the one hand or such Participant or such other
Indemnified Person, as the case may be, on the other, the parties’ relative intent, knowledge,
access to information and opportunity to correct or prevent such statement or omission, and any
other equitable considerations appropriate in the circumstances.

          (e) The parties agree that it would not be just and equitable if contribution pursuant to this
Section 7 were determined by pro rata allocation (even if the Participants were
treated as one entity for such purpose) or by any other method of allocation that does not take
account of the equitable considerations referred to in the immediately preceding paragraph. The
amount paid or payable by an Indemnified Person as a result of the losses, claims, damages,
judgments, liabilities and expenses referred to in the immediately preceding paragraph shall be

-22-

 

deemed to include, subject to the limitations set forth above, any reasonable legal or other
expenses actually incurred by such Indemnified Person in connection with investigating or defending
any such action or claim. Notwithstanding the provisions of this Section 7, in no event shall a
Participant be required to contribute any amount in excess of the amount by which proceeds received
by such Participant from sales of Registrable Securities or Exchange Notes (and related
guarantees), as the case may be, exceeds the amount of any damages that such Participant has
otherwise been required to pay or has paid by reason of such untrue or alleged untrue statement or
omission or alleged omission. No Person guilty of a fraudulent misrepresentation (within the
meaning of Section 11(f) of the Securities Act) shall be entitled to contribution from any Person
who was not guilty of such fraudulent misrepresentation.

          (f) Any losses, claims, damages, liabilities or expenses for which an indemnified party is
entitled to indemnification or contribution under this Section 7 shall be paid by the Indemnifying
Person to the Indemnified Person as such losses, claims, damages, liabilities or expenses are
incurred. The indemnity and contribution agreements contained in this Section 7 and the
representations and warranties of the Company set forth in this Agreement shall remain operative
and in full force and effect, regardless of (i) any investigation made by or on behalf of any
Holder or any person who controls a Holder, or by the Company, its directors, officers, employees
or agents or any person controlling any of the Issuers, and (ii) any termination of this Agreement.

          (g) The indemnity and contribution agreements contained in this Section 7 will be in addition
to any liability which the Indemnifying Persons may otherwise have to the Indemnified Persons
referred to above.

     8. Rules 144 and 144A

          Each of the Issuers covenants and agrees that it will file the reports required to be filed by
it under the Securities Act and the Exchange Act and the rules and regulations adopted by the SEC
thereunder in a timely manner in accordance with the requirements of the Securities Act and the
Exchange Act and, if at any time such Issuer is not required to file such reports, such Issuer
will, upon the request of any Holder or beneficial owner of Registrable Securities, make available
such information necessary to permit sales pursuant to Rule 144A under the Securities Act. The
Company further covenants and agrees, for so long as any Registrable Securities remain outstanding
that it will take such further action as any Holder of Registrable Securities may reasonably
request, all to the extent required from time to time to enable such holder to sell Registrable
Securities without registration under the Securities Act within the limitations of the exemptions
provided by (a) Rule 144(k) and Rule 144A under the Securities Act, as such Rules may be amended
from time to time, or (b) any similar rule or regulation hereafter adopted by the SEC.

     9. Underwritten Registrations

          If any of the Registrable Securities covered by any Shelf Registration Statement are to be
sold in an underwritten offering, the investment banker or investment bankers and manager or
managers that will manage the offering will be selected by the Holders of a majority in

-23-

 

aggregate principal amount of such Registrable Securities included in such offering and shall
be reasonably acceptable to the Issuers.

          No Holder of Registrable Securities may participate in any underwritten registration hereunder
unless such Holder (a) agrees to sell such Holder’s Registrable Securities on the basis provided in
any underwriting arrangements approved by the Persons entitled hereunder to approve such
arrangements and (b) completes and executes in a timely manner all questionnaires, powers of
attorney, indemnities, underwriting agreements and other customary documents required by the
Company or the underwriter in connection with such underwriting arrangements.

     10. Miscellaneous

          (a) No Inconsistent Agreements. The Issuers have not, as of the date hereof, and the
Issuers shall not, after the date of this Agreement, enter into any agreement with respect to any
of its securities that is inconsistent with the rights granted to the Holders of Registrable
Securities in this Agreement or otherwise conflicts with the provisions hereof. The rights granted
to the Holders hereunder do not in any way conflict with and are not inconsistent with the rights
granted to the holders of the Issuers’ other issued and outstanding securities under any such
agreements. The Issuers will not enter into any agreement with respect to any of its securities
which will grant to any Person piggyback registration rights with respect to any Registration
Statement other than the Other Registration Rights Agreement and any similar registration rights
agreement relating to the Company’s 5.60% Senior Notes due 2015.

          (b) Adjustments Affecting Registrable Securities. The Issuers shall not, directly or
indirectly, take any action with respect to the Registrable Securities as a class that would
adversely affect the ability of the Holders of Registrable Securities to include such Registrable
Securities in a registration undertaken pursuant to this Agreement.

          (c) Amendments and Waivers. The provisions of this Agreement may not be amended,
modified or supplemented, and waivers or consents to departures from the provisions hereof may not
be given, otherwise than with the prior written consent of (I) the Company and (II)(A) the Holders
of not less than a majority in aggregate principal amount of the then outstanding Registrable
Securities and (B) if the amendment, modification, supplement, waiver or consent would adversely
affect the Participating Broker-Dealers, the Participating Broker-Dealers holding not less than a
majority in aggregate principal amount of the Exchange Notes (and related guarantees) held by all
Participating Broker-Dealers; provided, however, that Section 7 and this Section
10(c) may not be amended, modified or supplemented without the prior written consent of each Holder
and each Participating Broker-Dealer (including any person who was a Holder or Participating
Broker-Dealer of Registrable Securities or Exchange Notes (and related guarantees), as the case may
be, disposed of pursuant to any Registration Statement) affected by any such amendment,
modification or supplement. Notwithstanding the foregoing, a waiver or consent to depart from the
provisions hereof with respect to a matter that relates exclusively to the rights of Holders of
Registrable Securities whose securities are being sold pursuant to a Registration Statement and
that does not directly or indirectly affect, impair, limit or compromise the rights of other
Holders of Registrable Securities may be given by Holders of

-24-

 

at least a majority in aggregate principal amount of the Registrable Securities being sold
pursuant to such Registration Statement.

          (d) Notices. All notices and other communications (including, without limitation, any
notices or other communications to the Trustee) provided for or permitted hereunder shall be made
in writing by hand-delivery, registered first-class mail, next-day air courier or facsimile:

     (i) if to a Holder of the Registrable Securities or any Participating
Broker-Dealer, at the most current address of such Holder or Participating
Broker-Dealer, as the case may be, set forth on the records of the registrar under
the Indenture, with a copy in like manner to the Initial Purchasers as follows:

Deutsche Bank Securities Inc.

60 Wall Street

New York, New York 10005

Attention: Debt Capital Markets

with a copy to:

Willkie Farr & Gallagher LLP

787 Seventh Avenue

New York, New York, 10019

Attention: John S. D’Alimonte, Esq.

                    David K. Boston, Esq.

     (ii) if to the Company, at the address as follows:

700 N.W. 107th Avenue

Miami, Florida 33172

Attention: General Counsel, Mark Sustana

with a copy to:

Clifford Chance US LLP

200 Park Avenue

New York, New York 10166

Attention: David W. Bernstein, Esq.

             (iii) if to the Initial Purchasers, at the address specified in Section
10(d)(i).

          All such notices and communications shall be deemed to have been duly given: when delivered
by hand, if personally delivered; five business days after being deposited in the mail, postage
prepaid, if mailed; one business day after being timely delivered to a next-day air courier; and
when receipt is acknowledged by the addressee, if sent by facsimile.

-25-

 

          Copies of all such notices, demands or other communications shall be concurrently delivered by
the Person giving the same to the Trustee under an indenture at the address and in the manner
specified in the indenture.

          (e) Successors and Assigns. This Agreement shall inure to the benefit of and be
binding upon the successors and assigns of each of the parties hereto, the Holders and the
Participating Broker-Dealers.

          (f) Counterparts. This Agreement may be executed in any number of counterparts and by
the parties hereto in separate counterparts, each of which when so executed shall be deemed to be
an original (including facsimile signatures) and all of which taken together shall constitute one
and the same agreement.

          (g) Headings. The headings in this Agreement are for convenience of reference only
and shall not limit or otherwise affect the meaning hereof.

          (h) Governing Law. THIS AGREEMENT SHALL BE GOVERNED BY AND CONSTRUED IN ACCORDANCE
WITH THE LAWS OF THE STATE OF NEW YORK, AS APPLIED TO CONTRACTS MADE AND TO BE PERFORMED ENTIRELY
WITHIN THE STATE OF NEW YORK, WITHOUT REGARD TO PRINCIPLES OF CONFLICTS OF LAW THAT WOULD APPLY THE
LAW OF ANY OTHER JURISDICTION. EACH OF THE PARTIES HERETO AGREES TO SUBMIT TO THE JURISDICTION OF
THE COURTS OF THE STATE OF NEW YORK SITTING IN NEW YORK COUNTY OR OF THE UNITED STATES OF AMERICA
FOR THE SOUTHERN DISTRICT OF NEW YORK IN ANY ACTION OR PROCEEDING ARISING OUT OF OR RELATING TO
THIS AGREEMENT.

          (i) Severability. If any term, provision, covenant or restriction of this Agreement
is held by a court of competent jurisdiction to be invalid, illegal, void or unenforceable, the
remainder of the terms, provisions, covenants and restrictions set forth herein shall remain in
full force and effect and shall in no way be affected, impaired or invalidated, and the parties
hereto shall use their best efforts to find and employ an alternative means to achieve the same or
substantially the same result as that contemplated by such term, provision, covenant or
restriction. It is hereby stipulated and declared to be the intention of the parties that they
would have executed the remaining terms, provisions, covenants and restrictions without including
any of such that may be hereafter declared invalid, illegal, void or unenforceable.

          (j) Securities Held by the Issuers or their Affiliates. Whenever the consent or
approval of Holders of a specified percentage of Registrable Securities is required hereunder,
Registrable Securities held by the Issuers or their respective affiliates (as such term is defined
in Rule 405 under the Securities Act) shall not be counted in determining whether such consent or
approval was given by the Holders of such required percentage.

          (k) Third-Party Beneficiaries. Holders of Registrable Securities and Participating
Broker-Dealers are intended third-party beneficiaries of this Agreement, and this Agreement may be
enforced by such Persons.

-26-

 

          (l) Entire Agreement. This Agreement, together with the Purchase Agreement and the
Indenture, is intended by the parties as a final and exclusive statement of the agreement and
understanding of the parties hereto in respect of the subject matter contained herein and therein
and any and all prior oral or written agreements, representations, or warranties, contracts,
understandings, correspondence, conversations and memoranda between the Holders on the one hand and
the Issuers on the other, or between or among any agents, representatives, parents, subsidiaries,
affiliates, predecessors in interest or successors in interest with respect to the subject matter
hereof and thereof are merged herein and replaced hereby.

[Signature page follows.]

-27-

 

     IN WITNESS WHEREOF, the parties have executed this Agreement as of the date first written
above.

	 	 	 	 	 
	 	LENNAR CORPORATION

 	 
	 	By:  	/s/
Diane Bessette
 	 
	 	 	Name:  	Diane Bessette 	 
	 	 	Title:  	Vice President and Treasurer 	 
	 

The foregoing Agreement is hereby confirmed

and accepted as of the date first above

written.

BARCLAYS CAPITAL INC.

DEUTSCHE BANK SECURITIES INC.

J.P. MORGAN SECURITIES INC.

WACHOVIA CAPITAL MARKETS, LLC

BANC OF AMERICA SECURITIES LLC

CALYON SECURITIES (USA) INC.

COMERICA SECURITIES, INC.

SUNTRUST CAPITAL MARKETS, INC.

BNP PARIBAS SECURITIES CORP.

GREENWICH CAPITAL MARKETS, INC.

By: DEUTSCHE BANK SECURITIES INC.

	 	 	 	 	 
	 	 
	By:  	/s/
Nigel W.H. Cree
 	 
	 	Name:  	 	 
	 	Title:  	 	 
	 
	 	 	 
	By:  	/s/
Matthew Siracuce
 	 
	 	Name:  	 	 
	 	Title:  	 	 

-28-

 

	 	 	 	 	 

Acme Water Supply & Management Company

Aquaterra Utilities, Inc.

Asbury Woods L.L.C.

Avalon-Sienna III, L.L.C.

Barnsboro Associates, LLC

Bayhome USH, Inc.

Bella Oaks L.L.C.

Bickford Holdings, LLC

Boca Greens, Inc.

Boca Isles South Club, Inc.

Boggy Creek USH, Inc.

Bramalea California, Inc.

Bramalea California Properties, Inc.

Bramalea California Realty, Inc.

Brazoria County LP, Inc.

Brewer Baseline Investors, LLC

Builders Acquisition Corp.

Builders LP, Inc.

Cambria L.L.C.

Cantera Village L.L.C.

Cary Woods L.L.C.

Claremont Ridge L.L.C.

Claridge Estates L.L.C.

Clodine-Bellaire LP, Inc.

Club Pembroke Isles, Inc.

Club Tampa Palms, Inc.

Colonial Heritage LLC

Concord at Meadowbrook L.L.C.

Concord at Pheasant Run Trails L.L.C.

Concord at Ravenna L.L.C.

Concord at Zurich Village L.L.C.

Concord City Centre L.L.C.

Concord Hills, Inc.

Concord Homes, Inc.

Concord Lake, Inc.

Concord Mills Estates L.L.C.

Concord Oaks, Inc.

Concord Park, Inc.

Concord Pointe, Inc.

Coto de Caza, Ltd.

Country Club Development at the Fort, LLC

Coventry L.L.C.

Crestfield Holdings, LLC

DCA NJ Realty, Inc.

DCA of Lake Worth, Inc.

-29-

 

DCA of New Jersey, Inc.

E.M.J.V. Corp.

Enclave Land, L.L.C.

ERMLOE, LLC

F.P. Construction Corp.

Fidelity Guaranty and Acceptance Corporation

Fortress Holding – Virginia, LLC

Fortress Illinois, LLC

Fortress Management, Inc.

Fortress Missouri, LLC

Fortress Mortgage, Inc.

Fortress Pennsylvania, LLC

Fortress Pennsylvania Realty, Inc.

Fortress-Florida, Inc.

Fox-Maple Associates, LLC

Foxwood L.L.C.

Gateway Commons, L.L.C.

Genesee Communities I, Inc.

Genesee Communities II, LLC

Genesee Communities III, Inc.

Genesee Communities IV, LLC

Genesee Communities V, LLC

Genesee Communities VI, LLC

Genesee Communities VII, LLC

Genesee Communities VIII, LLC

Genesee Communities IX, LLC

Genesee Venture, LLC

Glenview Reserve, LLC

Grand Isle Club, Inc.

Greenfield/Waterbury L.L.C.

Greystone Construction, Inc.

Greystone Homes, Inc.

Greystone Homes of Nevada, Inc.

Greystone Nevada, LLC

Harris County LP, Inc.

Haverton L.L.C.

Heathcote Commons LLC

Heritage Harbour Realty, Inc.

Heritage Housing Group, Inc.

Heritage USH, Inc.

Home Buyer’s Advantage Realty, Inc.

Homecraft Corporation

Imperial Homes Corporation

Impressions L.L.C.

Inactive Corporations, Inc.

Kings Lake TH, LLC

-30-

 

Kings Ridge Golf Corporation

Kings Ridge Recreation Corporation

Kings Wood Development Corporation

Kirkland Mare Island Holdings, LLC

Landmark Homes, Inc.

Laureate Homes of Arizona, Inc.

Legacy Homes, Inc.

Legends Club, Inc.

Legends Golf Club, Inc.

LENH I, LLC

Lennar Acquisition Corp. II

Lennar Americanos Douglas, LLC

Lennar Associates Management, LLC

Lennar Associates Management Holding Company

Lennar Aviation, Inc.

Lennar Carolina, Inc.

Lennar Central Park, LLC

Lennar Central Region Sweep, Inc.

Lennar Chicago, Inc.

Lennar CLB Bankers Hill, LLC

Lennar Communities, Inc.

Lennar Communities Development, Inc.

Lennar Communities of Chicago, LLC

Lennar Communities of Florida, Inc.

Lennar Communities Nevada, LLC

Lennar Construction, Inc.

Lennar Coto Holdings, L.L.C.

Lennar Developers, Inc.

Lennar Developers, Inc. II

Lennar Developers, Inc. III

Lennar Family of Builders GP, Inc.

Lennar Family of Builders Limited Partnership

Lennar Financial Services, LLC

Lennar Fresno, Inc.

Lennar Hingham Holdings, LLC

Lennar Hingham JV, LLC

Lennar Homes, Inc.

Lennar Homes Holding Corp.

Lennar Homes of Arizona, Inc.

Lennar Homes of California, Inc.

Lennar Homes of Texas Land and Construction, Ltd.

Lennar Homes of Texas Sales and Marketing, Ltd.

Lennar Houston Land, LLC

Lennar Imperial Holdings Limited Partnership

Lennar La Paz, Inc.

Lennar La Paz Limited, Inc.

-31-

 

Lennar Land Partners Sub, Inc.

Lennar Land Partners Sub II, Inc.

Lennar Long Beach Promenade Partners, LLC

Lennar Meridian Hills Partners, LLC

Lennar Military Housing, Inc.

Lennar Nevada, Inc.

Lennar New York, LLC

Lennar Northeast Properties, Inc.

Lennar Northland I, Inc.

Lennar Northland II, Inc.

Lennar Northland III, Inc.

Lennar Northland IV, Inc.

Lennar Northland V, Inc.

Lennar Northland VI, Inc.

Lennar Pacific, Inc.

Lennar Pacific, L.P.

Lennar Pacific Properties, Inc.

Lennar Pacific Properties Management, Inc.

Lennar PNW, Inc.

Lennar Port Imperial South Building 10, LLC

Lennar Port Imperial South Building 12, LLC

Lennar Port Imperial South Limited Partnership

Lennar Realty, Inc.

Lennar Renaissance, Inc.

Lennar Reno, LLC

Lennar Riverside West Holdings, LLC

Lennar Riverside West Limited Partnership

Lennar Riverside West Urban Renewal Company, L.L.C.

Lennar Sacramento, Inc.

Lennar Sales Corp.

Lennar San Jose Holdings, Inc.

Lennar Southland I, Inc.

Lennar Southland II, Inc.

Lennar Southland III, Inc.

Lennar Southwest Holding Corp.

Lennar Texas Holding Company

Lennar Trading Company, LP

Lennar.Com, Inc.

Lennar-Kings Lake, Inc.

Lennar-Lantana Boatyard, Inc.

Lennarstone Marketing Group, LLC

LFS Holding Company, LLC

LH Eastwind, LLC

LHI Renaissance, LLC

LN, L.L.C.

Long Point Development Corporation

-32-

 

Lorton Station, LLC

Lucerne Merged Condominiums, Inc.

M.A.P. Builders, Inc.

Madrona Village L.L.C.

Marble Mountain Partners, LLC

Marlborough Development Corporation

Mid-County Utilities, Inc.

Midland Housing Industries Corp.

Midland Investment Corporation

Mission Viejo 12S Venture, LP

Mission Viejo Holdings, Inc.

Moffett Meadows Partners, LLC

New Home Brokerage, Inc.

North County Land Company, LLC

Northbridge L.L.C.

Northeastern Properties LP, Inc.

Northern Land Company, LLC

NuHome Designs, L.L.C.

Oceanpointe Development Corporation

Orrin Thompson Construction Company

Orrin Thompson Homes Corp.

Paparone Construction Co.

Parc Chestnut L.L.C.

Parkside Estates L.L.C.

Parkview Meadows Holdings, LLC

Patriot Homes of Virginia, Inc.

Placer Vineyards, LLC

Polygon La Paz Associates

Providence Glen L.L.C.

Rancho Summit, LLC

Reserve at Creek Run, LLC

Rivenhome Corporation

Riviera Land Corp.

RRKTG Lumber, LLC

Rutenberg Homes, Inc. (FL)

Rutenberg Homes of Texas, Inc.

S. Florida Construction, LLC

S. Florida Construction II, LLC

S. Florida Construction III, LLC

Savell Gulley Development Corporation

SEA Joint Venture, LLC

SFHR Management, L.L.C.

Silver Lakes-Gateway Clubhouse, Inc.

Sonoma L.L.C.

South Park Development, LLC

Spanish Springs Development, LLC

-33-

 

Stoney Corporation

Stoneybrook Golf Club, Inc.

Strategic Cable Technologies, L.P.

Strategic Holdings, Inc.

Strategic Technologies, Inc.

Strategic Technologies Communications of California, Inc.

Summerway Investment Corp.

Summerwood, L.L.C.

Summit Acquisition Corp.

Summit Enclave, L.L.C.

Summit Glen, L.L.C.

Summit Land, L.L.C.

Summit Ridge 23, L.L.C.

Summit Townes, L.L.C.

Summit-Meadowbrook, L.L.C.

Summit-Reserve, L.L.C.

Sunstar Enterprises, LLC

The Club at Stoneybrook, Inc.

The Courts of Indian Creek L.L.C.

The Fortress Group, Inc.

The Grande By Lennar Builders, Inc.

The Sexton L.L.C.

Tustin Villas Partners, LLC

Tustin Vistas Partners, LLC

U.S. Home Associates Management, Inc.

U.S. Home Corporation

U.S. Home of Arizona Construction Co.

U.S. Home of West Virginia, Inc.

U.S. Home Realty, Inc.

U.S. Home Realty Corporation

U.S. Home Southwest Holding Corp.

U.S.H. Corporation of New York

U.S.H. Los Prados, Inc.

U.S.H. Realty, Inc.

University Community Partners, LLC

USH Acquisition Corp.

USH Apartments Corporation

USH Bickford, LLC

USH Equity Corporation

USH Heritage Pom, L.L.C.

USH Millennium Ventures Corp.

USH (West Lake), Inc.

USH Woodbridge, Inc.

USHHH, Inc.

Villages of Rio Pinar Club, Inc.

Wasson Canyon Holdings, LLC

-34-

 

West Adams Street L.L.C.

West Chocolate Bayou Development Corp.

Westbrook Homes, LLC

Westchase, Inc.

Westchase, Ltd.

Weststone Corporation

	 	 	 	 	 
	 	as Guarantors

 	 
	 	By:  	/s/
Mark Sustana
 	 
	 	 	Name:  	Mark Sustana 	 
	 	 	Title:  	Vice President 	 
	 

-35-<PAGE>
                                                                    Exhibit 10.6

                          CARIBOU COFFEE COMPANY, INC.

                           2005 EQUITY INCENTIVE PLAN
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                                TABLE OF CONTENTS

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Section 1. BACKGROUND AND PURPOSE........................................     1

Section 2. DEFINITIONS...................................................     1
   2.1  Affiliate........................................................     1
   2.2  Board............................................................     1
   2.3  Change Effective Date............................................     1
   2.4  Change in Control................................................     2
   2.5  Code.............................................................     5
   2.6  Committee........................................................     5
   2.7  Company..........................................................     5
   2.8  Director.........................................................     6
   2.9  Eligible Employee................................................     6
   2.10 Fair Market Value................................................     6
   2.11 ISO..............................................................     6
   2.12 1933 Act.........................................................     6
   2.13 1934 Act.........................................................     6
   2.14 Non-ISO..........................................................     7
   2.15 Option...........................................................     7
   2.16 Option Certificate...............................................     7
   2.17 Option Price.....................................................     7
   2.18 Parent...........................................................     7
   2.19 Plan.............................................................     7
   2.20 Preexisting Plan.................................................     7
   2.21 Rule 16b-3.......................................................     7
   2.22 SAR Value........................................................     7
   2.23 Stock............................................................     7
   2.24 Stock Appreciation Right.........................................     8
   2.25 Stock Appreciation Right Certificate.............................     8
   2.26 Stock Grant......................................................     8
   2.27 Stock Grant Certificate..........................................     8
   2.28 Stock Unit Grant.................................................     8
   2.29 Subsidiary.......................................................     8
   2.30 Ten Percent Shareholder..........................................     8

Section 3. SHARES AND GRANT LIMITS.......................................     9
   3.1  Shares Reserved..................................................     9
   3.2  Source of Shares.................................................     9
   3.3  Use of Proceeds..................................................    10
   3.4  Grant Limits.....................................................    10
   3.5  Preexisting Plan.................................................    10

Section 4. EFFECTIVE DATE................................................    10
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Section 5. COMMITTEE.....................................................    11

Section 6. ELIGIBILITY...................................................    11

Section 7. OPTIONS.......................................................    12
   7.1  Committee Action.................................................    12
   7.2  $100,000 Limit...................................................    12
   7.3  Option Price.....................................................    13
   7.4  Payment..........................................................    13
   7.5  Exercise.........................................................    13

Section 8. STOCK APPRECIATION RIGHTS.....................................    14
   8.1  Committee Action.................................................    14
   8.2  Terms and Conditions.............................................    15
   8.3  Exercise.........................................................    16

Section 9. STOCK GRANTS..................................................    17
   9.1  Committee Action.................................................    17
   9.2  Conditions.......................................................    17
   9.3  Dividends, Voting Rights and Creditor Status.....................    19
   9.4  Satisfaction of Forfeiture Conditions............................    21
   9.5  Income Tax Deduction.............................................    21

Section 10. NON-TRANSFERABILITY..........................................    24

Section 11. SECURITIES REGISTRATION......................................    24

Section 12. LIFE OF PLAN.................................................    25

Section 13. ADJUSTMENT...................................................    26
   13.1 Capital Structure................................................    26
   13.2 Available Shares.................................................    27
   13.3 Transactions Described in Section 424 of the Code................    27
   13.4 Fractional Shares................................................    28

Section 14. CHANGE IN CONTROL............................................    28

Section 15. AMENDMENT OR TERMINATION.....................................    29

Section 16. MISCELLANEOUS................................................    30
   16.1 Shareholder Rights...............................................    30
   16.2 No Contract of Employment........................................    30
   16.3 Withholding......................................................    31
   16.4 Construction.....................................................    31
   16.5 Other Conditions.................................................    31
   16.6 Rule 16b-3.......................................................    32
   16.7 Coordination with Employment Agreements and Other Agreements.....    32
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                                   Section 1.

                             BACKGROUND AND PURPOSE

          The purpose of this Plan is to promote the interest of the Company by
authorizing the Committee to grant Options and Stock Appreciation Rights and to
make Stock Grants and Stock Unit Grants to Eligible Employees and Directors in
order (1) to attract and retain Eligible Employees and Directors, (2) to provide
an additional incentive to each Eligible Employee or Director to work to
increase the value of Stock and (3) to provide each Eligible Employee or
Director with a stake in the future of the Company which corresponds to the
stake of each of the Company's shareholders.

                                   Section 2.

                                   DEFINITIONS

          2.1 Affiliate -- means any organization (other than a Subsidiary) that
would be treated as under common control with the Company under Section 414(c)
of the Code if "50 percent" were substituted for "80 percent" in the income tax
regulations under Section 414(c) of the Code.

          2.2 Board -- means the Board of Directors of the Company.

          2.3 Change Effective Date -- means either the date which includes the
"closing" of the transaction which makes a Change in Control effective if the
Change in Control is made effective through a transaction which has a "closing"
or the date a Change in Control is reported in accordance with applicable law as
effective to the Securities and Exchange Commission if the Change in Control is
made effective other than through a transaction which has a "closing".
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          2.4 Change in Control -- means that any of the following events has
occurred with respect to the Company, and the effective date of the Change of
Control Event shall be as of the first day that any one or more of the following
events shall have been fully and unconditionally effected:

          (a)  The acquisition by any Person other than Caribou Holding Company
               Limited or any of its Affiliates or any combination thereof of
               Beneficial Ownership of 50% or more of either (i) the then
               outstanding shares of Stock, or (ii) the combined voting power of
               the outstanding voting securities of the Company entitled to vote
               generally in the election of Directors; provided, however, that
               for purposes of this subsection, the following transactions shall
               not constitute a Change of Control Event: (A) any acquisition of
               such Stock or voting power directly from the Company through a
               public offering of shares of Stock of the Company, (B) any
               acquisition of such Stock or voting power by the Company, (C) any
               acquisition of such Stock or voting power by any employee benefit
               plan (or related trust) sponsored or maintained by the Company or
               any corporation controlled by the Company, (D) any acquisition of
               such Stock or voting power by any Person who, prior to such
               acquisition, had Beneficial Ownership of 50% or more of (i) the
               then outstanding shares of Stock, or (ii) the combined voting
               power of the outstanding voting securities of the Company
               entitled to vote generally in the election of Directors, or (E)
               any acquisition by any

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               corporation pursuant to a transaction which complies with clauses
               (i), (ii) and (iii) of subsection (3) below;

          (b)  The cessation, for any reason, of the individuals who constitute
               the Company's Board of Directors as of the date hereof
               ("Incumbent Board") to constitute at least a simple majority of
               the Company's Board of Directors; provided, however, that any
               individual who becomes a Director following the date hereof
               pursuant to the procedures for nomination and election set forth
               in the bylaws of the Company, or whose election, or nomination
               for election by the Company's stockholders, was otherwise
               approved by a vote of at least a majority of the Directors then
               comprising the Incumbent Board shall be considered as though such
               individual was a member of the Incumbent Board, but excluding,
               for this purpose, any such individual whose initial assumption of
               office occurs because of an actual or threatened election contest
               with respect to the election or removal of Directors or other
               actual or threatened solicitation of proxies or consents by or on
               behalf of a Person other than the Company's Board of Directors;

          (c)  The consummation of a reorganization, merger or consolidation or
               sale or other disposition of all or substantially all of the
               assets of the Company ("Business Combination") unless, following
               such Business Combination, (i) all or substantially all of the
               individuals and entities who were the Beneficial Owners,
               respectively, of the

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               outstanding shares of Stock of the Company and the outstanding
               voting securities of the Company immediately before such Business
               Combination Beneficially Own, directly or indirectly, more than
               50% of, respectively, the then outstanding shares of Stock and
               the combined voting power of the then outstanding voting
               securities entitled to vote generally in the election of
               Directors, as the case may be, of the Company resulting from or
               surviving such Business Combination (including, without
               limitation, a corporation which as a result of such transaction
               owns the Company or all or substantially all of the Company's
               assets either directly or through one or more subsidiaries) in
               substantially the same proportions as their ownership immediately
               before such Business Combination of the outstanding shares of
               Stock and the outstanding voting securities of the Company, as
               the case may be; (ii) no Person (excluding any corporation
               resulting from such Business Combination or any employee benefit
               plan (or related trust) of the Company or such corporation
               resulting from or surviving such Business Combination)
               beneficially owns, directly or indirectly, 50% or more of,
               respectively, the then outstanding shares of common stock of the
               corporation resulting from or surviving such Business Combination
               or the combined voting power of the then outstanding voting
               securities of such corporation except to the extent that such
               ownership existed as to the Company before the Business

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               Combination; and (iii) at least a simple majority of the members
               of the board of directors of the corporation resulting from or
               surviving such Business Combination were members of the Company's
               Board of Directors at the time of the execution of the initial
               agreement, or of the action of the Company's Board of Directors,
               providing for such Business Combination;

          (d)  The unconditional approval by the stockholders of the Company of
               a complete liquidation or dissolution of the Company (except for
               a liquidation of the Company which also qualifies as a Business
               Combination); or

          (e)  Any other condition or event (i) that the Committee determines to
               be a "Change of Control Event" within the meaning of this Section
               2.4 and (ii) that is set forth as a supplement to this Section
               2.4 in the Option Agreement.

          2.5 Code -- means the Internal Revenue Code of 1986, as amended.

          2.6 Committee -- means a committee of the Board which shall have at
least 2 members, each of whom shall be appointed by and shall serve at the
pleasure of the Board and shall come within the definition of a "non-employee
director" under Rule 16b-3 and an "outside director" under Section 162(m) of the
Code, provided, that, at any time the Board may take any action the Committee is
required or permitted to take under this Plan.

          2.7 Company -- means Caribou Coffee Company, Inc. and any successor to
Caribou Coffee Company, Inc.

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          2.8 Director -- means any member of the Board who is not an employee
of the Company or a Parent or Subsidiary or affiliate (as such term is defined
in Rule 405 of the 1933 Act) of the Company.

          2.9 Eligible Employee -- means an employee of the Company or any
Subsidiary or Parent or Affiliate to whom the Committee decides for reasons
sufficient to the Committee to make a grant under this Plan.

          2.10 Fair Market Value -- means either (a) the closing price on any
date for a share of Stock as reported by The Wall Street Journal or, if The Wall
Street Journal no longer reports such closing price, such closing price as
reported by a newspaper or trade journal selected by the Committee or, if no
such closing price is available on such date, (b) such closing price as so
reported in accordance with Section 2.10(a) for the immediately preceding
business day, or, if no newspaper or trade journal reports such closing price or
if no such price quotation is available, (c) the price which the Committee
acting in good faith determines through any reasonable valuation method that a
share of Stock might change hands between a willing buyer and a willing seller,
neither being under any compulsion to buy or to sell and both having reasonable
knowledge of the relevant facts.

          2.11 ISO -- means an option granted under this Plan to purchase Stock
which is intended to satisfy the requirements of Section 422 of the Code.

          2.12 1933 Act -- means the Securities Act of 1933, as amended.

          2.13 1934 Act -- means the Securities Exchange Act of 1934, as
amended.

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          2.14 Non-ISO -- means an option granted under this Plan to purchase
Stock which is intended to fail to satisfy the requirements of Section 422 of
the Code.

          2.15 Option -- means an ISO or a Non-ISO which is granted under
Section 7.

          2.16 Option Certificate -- means the certificate (whether in
electronic or written form) which sets forth the terms and conditions of an
Option granted under this Plan.

          2.17 Option Price -- means the price which shall be paid to purchase
one share of Stock upon the exercise of an Option granted under this Plan.

          2.18 Parent -- means any corporation which is a parent corporation
(within the meaning of Section 424(e) of the Code) of the Company.

          2.19 Plan -- means this Caribou Coffee Company, Inc. 2005 Incentive
Stock Plan as effective as of the date approved by the shareholders of the
Company and as amended from time to time thereafter.

          2.20 Preexisting Plan -- means each of the following plans, as each
such plan has been amended from time to time up to the date this Plan is
effective: Caribou Coffee Company, Inc. 1994 Stock Awards Plan and the Caribou
Coffee Company, Inc. 2001 Stock Option Plan.

          2.21 Rule 16b-3 -- means the exemption under Rule 16b-3 to Section
16(b) of the 1934 Act or any successor to such rule.

          2.22 SAR Value -- means the value assigned by the Committee to a share
of Stock in connection with the grant of a Stock Appreciation Right under
Section 8.

          2.23 Stock -- means the common stock, par value $.01 per share, of the
Company.

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          2.24 Stock Appreciation Right -- means a right which is granted under
Section 8 to receive the appreciation in a share of Stock.

          2.25 Stock Appreciation Right Certificate -- means the certificate
(whether in electronic or written form) which sets forth the terms and
conditions of a Stock Appreciation Right which is not granted as part of an
Option.

          2.26 Stock Grant -- means a grant under Section 9 which is designed to
result in the issuance of the number of shares of Stock described in such grant
rather than a payment in cash based on the Fair Market Value of such shares of
Stock.

          2.27 Stock Grant Certificate -- means the certificate (whether in
electronic or written form) which sets forth the terms and conditions of a Stock
Grant or a Stock Unit Grant.

          2.28 Stock Unit Grant -- means a grant under Section 9 which is
designed to result in the payment of cash based on the Fair Market Value of the
number of shares of Stock described in such grant rather than the issuance of
the number of shares of Stock described in such grant.

          2.29 Subsidiary -- means a corporation which is a subsidiary
corporation (within the meaning of Section 424(f) of the Code) of the Company.

          2.30 Ten Percent Shareholder -- means a person who owns (after taking
into account the attribution rules of Section 424(d) of the Code) more than ten
percent of the total combined voting power of all classes of stock of either the
Company, a Subsidiary or Parent.

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                                   Section 3.

                             SHARES AND GRANT LIMITS

          3.1 Shares Reserved. There shall (subject to Section 13) be reserved
for issuance under this Plan (a) 500,000 shares of Stock, provided, however, (b)
no more than the number of shares of Stock described in Section 3.1(a) shall be
issued in connection with the exercise of ISOs and (c) nothing in this Plan
shall affect any grants under any Preexisting Plan which are outstanding on the
effective date of this Plan until such time, if any, that any shares of Stock
subject to such grants are forfeited or grants respecting any shares of Stock
expire on or after such effective date in accordance with the terms of such
grants; provided, further, however, that shares of Stock issuable pursuant to
grants under any Preexisting Plan that are forfeited shall increase the shares
of Stock that may be issued under this Plan as provided in Section 3.2.

          3.2 Source of Shares. The shares of Stock described in Section 3.1
shall be reserved to the extent that the Company deems appropriate from
authorized but unissued shares of Stock and from shares of Stock which have been
reacquired by the Company. All shares of Stock described in Section 3.1 shall
remain available for issuance under this Plan until issued pursuant to the
exercise of an Option or a Stock Appreciation Right or issued pursuant to a
Stock Grant, and any such shares of stock which are issued pursuant to an
Option, a Stock Appreciation Right or a Stock Grant which are forfeited
thereafter shall again become available for issuance under this Plan. Finally,
if the Option Price under an Option is paid in whole or in part in shares of
Stock or if shares of Stock are tendered to the Company in satisfaction of any
condition to a Stock Grant, such shares thereafter shall become available for
issuance under this Plan

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and shall be treated the same as any other shares available for issuance under
this Plan. Any shares of Stock that are issuable pursuant to a grant under a
Preexisting Plan that are forfeited shall increase the number of shares of Stock
that may be issued under this Plan on a one-for-one basis.

          3.3 Use of Proceeds. The proceeds which the Company receives from the
sale of any shares of Stock under this Plan shall be used for general corporate
purposes and shall be added to the general funds of the Company.

          3.4 Grant Limits. No Eligible Employee or Director in any calendar
year shall be granted an Option to purchase (subject to Section 13) more than
100,000 shares of Stock or a Stock Appreciation Right based on the appreciation
with respect to (subject to Section 13) more than 100,000 shares of Stock, and
no Stock Grant or Stock Unit Grant shall be made to any Eligible Employee or
Director in any calendar year where the Fair Market Value of the Stock subject
to such grant on the date of the grant exceeds $5,000,000. No more than 250,000
non-forfeitable shares of Stock shall (subject to Section 13) be issued pursuant
to Stock Grants under Section 9.

          3.5 Preexisting Plan. No grants shall be made under any Preexisting
Plan on or after the date this Plan becomes effective.

                                   Section 4.

                                 EFFECTIVE DATE

          This Plan shall be effective as of the first date of which (1) the
shareholders of the Company (acting at a duly called meeting of such
shareholders) have approved the adoption of this Plan and (2) the Company's
initial public offering of

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its Stock pursuant to a Registration Statement on Form S-1 (Registration No.
333-126691) shall have closed.

                                   Section 5.

                                    COMMITTEE

          This Plan shall be administered by the Committee. The Committee acting
in its absolute discretion shall exercise such powers and take such action as
expressly called for under this Plan and, further, the Committee shall have the
power to interpret this Plan and (subject to Section 14 and Section 15 and Rule
16b-3) to take such other action in the administration and operation of this
Plan as the Committee deems equitable under the circumstances, which action
shall be binding on the Company, on each affected Eligible Employee or Director
and on each other person directly or indirectly affected by such action.
Furthermore, the Committee as a condition to making any grant under this Plan to
any Eligible Employee shall have the right to require him or her to execute an
agreement which makes the Eligible Employee subject to non-competition
provisions and other restrictive covenants which run in favor of the Company.

                                   Section 6.

                                   ELIGIBILITY

          Only Eligible Employees who are employed by the Company or a
Subsidiary or Parent shall be eligible for the grant of ISOs under this Plan.
All Eligible Employees and all Directors shall be eligible for the grant of
Non-ISOs and Stock Appreciation Rights and for Stock Grants and Stock Unit
Grants under this Plan.

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                                   Section 7.

                                     OPTIONS

          7.1 Committee Action. The Committee acting in its absolute discretion
shall have the right to grant Options to Eligible Employees and to Directors
under this Plan from time to time to purchase shares of Stock, but the Committee
shall not (subject to Section 13) take any action, whether through amendment,
cancellation, replacement grants, or any other means, to reduce the Option Price
of any outstanding Options absent the approval of the Company's shareholders.
Each grant of an Option to a Eligible Employee or Director shall be evidenced by
an Option Certificate, and each Option Certificate shall set forth whether the
Option is an ISO or a Non-ISO and shall set forth such other terms and
conditions of such grant as the Committee acting in its absolute discretion
deems consistent with the terms of this Plan; however, (a) if the Committee
grants an ISO and a Non-ISO to a Eligible Employee on the same date, the right
of the Eligible Employee to exercise the ISO shall not be conditioned on his or
her failure to exercise the Non-ISO and (b) if the only condition to exercise of
the Option is the completion of a period of service, such period of service
shall be no less than the one (1) year period which starts on the date as of
which the Option is granted unless the Committee determines that a shorter
period of service (or no period of service) better serves the Company's
interest.

          7.2 $100,000 Limit. No Option shall be treated as an ISO to the extent
that the aggregate Fair Market Value of the Stock subject to the Option which
would first become exercisable in any calendar year exceeds $100,000. Any such
excess shall instead automatically be treated as a Non-ISO. The Committee shall
interpret and

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administer the ISO limitation set forth in this Section 7.2 in accordance with
Section 422(d) of the Code, and the Committee shall treat this Section 7.2 as in
effect only for those periods for which Section 422(d) of the Code is in effect.

          7.3 Option Price. The Option Price for each share of Stock subject to
an Option shall be no less than the Fair Market Value of a share of Stock on the
date the Option is granted; provided, however, if the Option is an ISO granted
to an Eligible Employee who is a Ten Percent Shareholder, the Option Price for
each share of Stock subject to such ISO shall be no less than 110% of the Fair
Market Value of a share of Stock on the date such ISO is granted.

          7.4 Payment. The Option Price shall be payable in full upon the
exercise of any Option and, at the discretion of the Committee, an Option
Certificate can provide for the payment of the Option Price either in cash, by
check or in Stock which has been held for at least 6 months and which is
acceptable to the Committee, or through any cashless exercise procedure which is
effected by an unrelated broker through a sale of Stock in the open market and
which is acceptable to the Committee, or in any combination of such forms of
payment. Any payment made in Stock shall be treated as equal to the Fair Market
Value of such Stock on the date the certificate for such Stock (or proper
evidence of such certificate) is presented to the Committee or its delegate in
such form as acceptable to the Committee.

          7.5 Exercise.

               (a)  Exercise Period. Each Option granted under this Plan shall
                    be exercisable in whole or in part at such time or times as
                    set forth in the related Option Certificate, but no Option

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                    Certificate shall make an Option exercisable on or after the
                    earlier of

                         (1)  the date which is the fifth anniversary of the
                              date the Option is granted, if the Option is an
                              ISO and the Eligible Employee is a Ten Percent
                              Shareholder on the date the Option is granted, or

                         (2)  the date which is the tenth anniversary of the
                              date the Option is granted, if the Option is (a) a
                              Non-ISO or (b) an ISO which is granted to an
                              Eligible Employee who is not a Ten Percent
                              Shareholder on the date the Option is granted.

               (b)  Termination of Status as Eligible Employee or Director.
                    Subject to Section 7.5(a), an Option Certificate may provide
                    for the exercise of an Option after an Eligible Employee's
                    or a Director's status as such has terminated for any reason
                    whatsoever, including death or disability.

                                   Section 8.

                            STOCK APPRECIATION RIGHTS

          8.1 Committee Action. The Committee acting in its absolute discretion
shall have the right to grant Stock Appreciation Rights to Eligible Employees
and to Directors under this Plan from time to time, and each Stock Appreciation
Right grant shall be evidenced by a Stock Appreciation Right Certificate or, if
such Stock

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Appreciation Right is granted as part of an Option, shall be evidenced by the
Option Certificate for the related Option.

          8.2 Terms and Conditions.

          (a)  Stock Appreciation Right Certificate. If a Stock Appreciation
               Right is granted independent of an Option, such Stock
               Appreciation Right shall be evidenced by a Stock Appreciation
               Right Certificate, and such certificate shall set forth the
               number of shares of Stock on which the Eligible Employee's or
               Director's right to appreciation shall be based and the SAR Value
               of each share of Stock. Such SAR Value shall be no less than the
               Fair Market Value of a share of Stock on the date that the Stock
               Appreciation Right is granted. The Stock Appreciation Right
               Certificate shall set forth such other terms and conditions for
               the exercise of the Stock Appreciation Right as the Committee
               deems appropriate under the circumstances, but no Stock
               Appreciation Right Certificate shall make a Stock Appreciation
               Right exercisable on or after the date which is the tenth
               anniversary of the date such Stock Appreciation Right is granted.

          (b)  Option Certificate. If a Stock Appreciation Right is granted
               together with an Option, such Stock Appreciation Right shall be
               evidenced by an Option Certificate, the number of shares of Stock
               on which the Eligible Employee's or Director's right to
               appreciation shall be based shall be the same as the number of
               shares of Stock subject

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               to the related Option, and the SAR Value for each such share of
               Stock shall be no less than the Option Price under the related
               Option. Each such Option Certificate shall provide that the
               exercise of the Stock Appreciation Right with respect to any
               share of Stock shall cancel the Eligible Employee's or Director's
               right to exercise his or her Option with respect to such share
               and, conversely, that the exercise of the Option with respect to
               any share of Stock shall cancel the Eligible Employee's or
               Director's right to exercise his or her Stock Appreciation Right
               with respect to such share. A Stock Appreciation Right which is
               granted as part of an Option shall be exercisable only while the
               related Option is exercisable. The Option Certificate shall set
               forth such other terms and conditions for the exercise of the
               Stock Appreciation Right as the Committee deems appropriate under
               the circumstances.

          (c)  Minimum Period of Service. If the only condition to exercise of a
               Stock Appreciation Right is the completion of a period of
               service, such period of service shall be no less than the one (1)
               year period which starts on the date as of which the Stock
               Appreciation Right is granted unless the Committee determines
               that a shorter period of service (or no period of service) better
               serves the Company's interest.

          8.3 Exercise. A Stock Appreciation Right shall be exercisable only
when the Fair Market Value of a share of Stock on which the right to
appreciation is

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based exceeds the SAR Value for such share, and the payment due on exercise
shall be based on such excess with respect to the number of shares of Stock to
which the exercise relates. An Eligible Employee or Director upon the exercise
of his or her Stock Appreciation Right shall receive a payment from the Company
in cash or in Stock issued under this Plan, or in a combination of cash and
Stock, and the number of shares of Stock issued shall be based on the Fair
Market Value of a share of Stock on the date the Stock Appreciation Right is
exercised. The Committee acting in its absolute discretion shall have the right
to determine the form and time of any payment under this Section 8.3.

                                   Section 9.

                                  STOCK GRANTS

          9.1 Committee Action. The Committee acting in its absolute discretion
shall have the right to make Stock Grants and Stock Unit Grants to Eligible
Employees and to Directors. Each Stock Grant and each Stock Unit Grant shall be
evidenced by a Stock Grant Certificate, and each Stock Grant Certificate shall
set forth the conditions, if any, under which Stock will be issued under the
Stock Grant or cash will be paid under the Stock Unit Grant and the conditions
under which the Eligible Employee's or Director's interest in any Stock which
has been issued will become non-forfeitable.

          9.2 Conditions.

          (a)  Conditions to Issuance of Stock. The Committee acting in its
               absolute discretion may make the issuance of Stock under a Stock
               Grant subject to the satisfaction of one, or more than one,
               condition which the Committee deems appropriate under the

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               circumstances for Eligible Employees or Directors generally or
               for an Eligible Employee or a Director in particular, and the
               related Stock Grant Certificate shall set forth each such
               condition and the deadline for satisfying each such condition.
               Stock subject to a Stock Grant shall be issued in the name of an
               Eligible Employee or Director only after each such condition, if
               any, has been timely satisfied, and any Stock which is so issued
               shall be held by the Company pending the satisfaction of the
               forfeiture conditions, if any, under Section 9.2(b) for the
               related Stock Grant.

          (b)  Conditions on Forfeiture of Stock or Cash Payment. The Committee
               acting in its absolute discretion may make any cash payment due
               under a Stock Unit Grant or Stock issued in the name of an
               Eligible Employee or Director under a Stock Grant non-forfeitable
               subject to the satisfaction of one, or more than one, objective
               employment, performance or other condition that the Committee
               acting in its absolute discretion deems appropriate under the
               circumstances for Eligible Employees or Directors generally or
               for an Eligible Employee or a Director in particular, and the
               related Stock Grant Certificate shall set forth each such
               condition, if any, and the deadline, if any, for satisfying each
               such condition. An Eligible Employee's or a Director's
               non-forfeitable interest in the shares of Stock underlying a
               Stock Grant or the cash payable under a Stock Unit Grant shall
               depend on the extent

                                      -18-
<PAGE>
               to which he or she timely satisfies each such condition. If a
               share of Stock is issued under this Section 9.2(b) before a
               Eligible Employee's or Director's interest in such share of Stock
               is non-forfeitable, (1) such share of Stock shall not be
               available for re-issuance under Section 3 until such time, if
               any, as such share of Stock thereafter is forfeited as a result
               of a failure to timely satisfy a forfeiture condition and (2) the
               Company shall have the right to condition any such issuance on
               the Eligible Employee or Director first signing an irrevocable
               stock power in favor of the Company with respect to the
               forfeitable shares of Stock issued to such Eligible Employee or
               Director in order for the Company to effect any forfeiture called
               for under the related Stock Grant Certificate.

          (c)  Minimum Period of Service. If the only condition to the
               forfeiture of a Stock Grant or a Stock Unit Grant is the
               completion of a period of service, such period of service shall
               be no less than the one (1) year period which starts on the date
               as of which the Stock Grant or Stock Unit Grant is made unless
               the Committee determines that a shorter period of service (or no
               period of service) better serves the Company's interest.

          9.3 Dividends, Voting Rights and Creditor Status.

          (a)  Cash Dividends. Except as otherwise set forth in a Stock Grant
               Certificate, if a dividend is paid in cash on a share of Stock
               after such Stock has been issued under a Stock Grant but before
               the

                                      -19-
<PAGE>
               first date that an Eligible Employee's or a Director's interest
               in such Stock (1) is forfeited completely or (2) becomes
               completely non-forfeitable, the Company shall pay such cash
               dividend directly to such Eligible Employee or Director.

          (b)  Stock Dividends. If a dividend is paid on a share of Stock in
               Stock after such Stock has been issued under a Stock Grant but
               before the first date that an Eligible Employee's or a Director's
               interest in such Stock (1) is forfeited completely or (2) becomes
               completely non-forfeitable, the Company shall hold such dividend
               Stock subject to the same conditions under Section 9.2(b) as the
               related Stock Grant.

          (c)  Other. If a dividend (other than a dividend described in Section
               9.3(a) or Section 9.3(b)) is paid with respect to a share of
               Stock after such Stock has been issued under a Stock Grant but
               before the first date that an Eligible Employee's or a Director's
               interest in such Stock (1) is forfeited completely or (2) becomes
               completely non-forfeitable, the Company shall distribute or hold
               such dividend in accordance with such rules as the Committee
               shall adopt with respect to each such dividend.

          (d)  Voting. Except as otherwise set forth in a Stock Grant
               Certificate, an Eligible Employee or a Director shall have the
               right to vote the Stock issued under his or her Stock Grant
               during the period which comes after such Stock has been issued
               under a Stock Grant but

                                      -20-
<PAGE>
               before the first date that an Eligible Employee's or Director's
               interest in such Stock (1) is forfeited completely or (2) becomes
               completely non-forfeitable.

          (e)  General Creditor Status. Each Eligible Employee and each Director
               to whom a Stock Unit grant is made shall be no more than a
               general and unsecured creditor of the Company with respect to any
               cash payable under such Stock Unit Grant.

          9.4 Satisfaction of Forfeiture Conditions. A share of Stock shall
cease to be subject to a Stock Grant at such time as an Eligible Employee's or a
Director's interest in such Stock becomes non-forfeitable under this Plan, and
the certificate or other evidence of ownership representing such share shall be
transferred to the Eligible Employee or Director as soon as practicable
thereafter.

          9.5 Income Tax Deduction.

          (a)  General. The Committee shall (where the Committee under the
               circumstances deems in the Company's best interest) either (1)
               make Stock Grants and Stock Unit Grants to Eligible Employees
               subject to at least one condition related to one, or more than
               one, performance goal based on the performance goals described in
               Section 9.5(b) which seems likely to result in the Stock Grant or
               Stock Unit Grant qualifying as "performance-based compensation"
               under Section 162(m) of the Code or (2) make Stock Grants and
               Stock Unit Grants to Eligible Employees under such other
               circumstances as the Committee deems likely to result in an
               income tax deduction for

                                      -21-
<PAGE>
               the Company with respect such Stock Grant or Stock Unit Grant. A
               performance goal may be set in any manner determined by the
               Committee, including looking to achievement on an absolute or
               relative basis in relation to peer groups or indexes, and no
               change may be made to a performance goal after the goal has been
               set.

          (b)  Performance Goals. A performance goal is described in this
               Section 9.5(b) if such goal relates to (1) the Company's return
               over capital costs or increases in return over capital costs, (2)
               the Company's total earnings or the growth in such earnings, (3)
               the Company's consolidated earnings or the growth in such
               earnings, (4) the Company's earnings per share or the growth in
               such earnings, (5) the Company's net earnings or the growth in
               such earnings, (6) the Company's earnings before interest
               expense, taxes, depreciation, amortization and other cash or
               non-cash items or the growth in such earnings, (7) the Company's
               earnings before interest and taxes or the growth in such
               earnings, (8) the Company's consolidated net income or the growth
               in such income, (9) the value of the Company's stock or the
               growth in such value, (10) the Company's stock price or the
               growth in such price, (11) the Company's return on assets or the
               growth on such return, (12) the Company's cash flow or the growth
               in such cash flow, (13) the Company's total shareholder return or
               the growth in such return, (14) the Company's expenses or the
               reduction of such expenses,

                                      -22-
<PAGE>
               (15) the Company's sales growth, including growth in comparable
               store sales, (16) the Company's overhead ratios or changes in
               such ratios, (17) the Company's expense-to-sales ratios or the
               changes in such ratios, or (18) the Company's number of store
               locations or growth in such number.

          (c)  Adjustments. When the Committee determines whether a performance
               goal has been satisfied for any period, the Committee where the
               Committee deems appropriate may make such determination using
               calculations which alternatively include and exclude one, or more
               than one, "extraordinary items" as determined under U.S.
               generally accepted accounting principles, and the Committee may
               determine whether a performance goal has been satisfied for any
               period taking into account the alternative which the Committee
               deems appropriate under the circumstances. The Committee also may
               take into account any other unusual or non-recurring items,
               including, without limitation, the charges or costs associated
               with restructurings of the Company, discontinued operations, and
               the cumulative effects of accounting changes and, further, may
               take into account any unusual or non-recurring events affecting
               the Company, changes in applicable tax laws or accounting
               principles or such other factors as the Committee may determine
               reasonable and appropriate under the circumstances (including,
               without limitation, any factors that could result in the

                                      -23-
<PAGE>
               Company's paying non-deductible compensation to an Eligible
               Employee).

                                  Section 10.

                              NON-TRANSFERABILITY

          No Option, Stock Grant, Stock Unit Grant or Stock Appreciation Right
shall (absent the Committee's consent) be transferable by an Eligible Employee
or a Director other than by will or by the laws of descent and distribution, and
any Option or Stock Appreciation Right shall (absent the Committee's consent) be
exercisable during a Eligible Employee's or Director's lifetime only by the
Eligible Employee or Director. The person or persons to whom an Option or Stock
Grant or Stock Unit Grant or Stock Appreciation Right is transferred by will or
by the laws of descent and distribution (or with the Committee's consent)
thereafter shall be treated as the Eligible Employee or Director.

                                   Section 11.

                             SECURITIES REGISTRATION

          As a condition to the receipt of shares of Stock under this Plan, the
Eligible Employee or Director shall, if so requested by the Company, agree to
hold such shares of Stock for investment and not with a view of resale or
distribution to the public and, if so requested by the Company, shall deliver to
the Company a written statement satisfactory to the Company to that effect.
Furthermore, if so requested by the Company, the Eligible Employee or Director
shall make a written representation to the Company that he or she will not sell
or offer for sale any of such Stock unless a registration statement shall be in
effect with respect to such Stock under the 1933 Act

                                      -24-
<PAGE>
and any applicable state securities law or he or she shall have furnished to the
Company an opinion in form and substance satisfactory to the Company of legal
counsel satisfactory to the Company that such registration is not required.
Certificates or other evidence of ownership representing the Stock transferred
upon the exercise of an Option or Stock Appreciation Right or upon the lapse of
the forfeiture conditions, if any, on any Stock Grant may at the discretion of
the Company bear a legend to the effect that such Stock has not been registered
under the 1933 Act or any applicable state securities law and that such Stock
cannot be sold or offered for sale in the absence of an effective registration
statement as to such Stock under the 1933 Act and any applicable state
securities law or an opinion in form and substance satisfactory to the Company
of legal counsel satisfactory to the Company that such registration is not
required.

                                   Section 12.

                                  LIFE OF PLAN

          No Option or Stock Appreciation Right shall be granted or Stock Grant
or Stock Unit Grant made under this Plan on or after the earlier of:

               (1)  the tenth anniversary of the effective date of this Plan (as
                    determined under Section 4), in which event this Plan
                    otherwise thereafter shall continue in effect until all
                    outstanding Options and Stock Appreciation Rights have been
                    exercised in full or no longer are exercisable and all Stock
                    issued under any Stock Grants under this Plan have been
                    forfeited or have become non-forfeitable, or

                                      -25-
<PAGE>
               (2)  the date on which all of the Stock reserved under Section 3
                    has (as a result of the exercise of Options or Stock
                    Appreciation Rights granted under this Plan or the
                    satisfaction of the forfeiture conditions, if any, on Stock
                    Grants) been issued or no longer is available for use under
                    this Plan, in which event this Plan also shall terminate on
                    such date.

                                   Section 13.

                                   ADJUSTMENT

          13.1 Capital Structure. The grant caps described in Section 3.4, the
number, kind or class (or any combination thereof) of shares of Stock subject to
outstanding Options and Stock Appreciation Rights granted under this Plan and
the Option Price of such Options and the SAR Value of such Stock Appreciation
Rights as well as the number, kind or class (or any combination thereof) of
shares of Stock subject to outstanding Stock Grants and Stock Unit Grants made
under this Plan shall be adjusted by the Committee in a reasonable and equitable
manner to preserve immediately after

          (a)  any equity restructuring or change in the capitalization of the
               Company, including, but not limited to, spin offs, stock
               dividends, large non-reoccurring dividends, rights offerings or
               stock splits, or

          (b)  any other transaction described in Section 424(a) of the Code
               which does not constitute a Change in Control of the Company

the aggregate intrinsic value of each such outstanding Option, Stock
Appreciation Right, Stock Grant and Stock Unit Grant immediately before such
restructuring or recapitalization or other transaction.

                                      -26-
<PAGE>
          13.2 Available Shares. If any adjustment is made with respect to any
outstanding Option, Stock Appreciation Right, Stock Grant or Stock Unit Grant
under Section 13.1, then the Committee shall adjust the number, kind or class
(or any combination thereof) of shares of Stock reserved under Section 3.1 so
that there is a sufficient number, kind and class of shares of Stock available
for issuance pursuant to each such Option, Stock Appreciation Right, Stock Grant
and Stock Unit Grant as adjusted under Section 13.1 without seeking the approval
of the Company's shareholders for such adjustment unless such approval is
required under applicable law or the rules of the stock exchange on which shares
of Stock are traded. Furthermore, the Committee shall have the absolute
discretion to further adjust such number, kind or class (or any combination
thereof) of shares of Stock reserved under Section 3.1 in light of any of the
events described in Section 13.1(a) and Section 13.1(b) to the extent the
Committee acting in good faith determinates that a further adjustment would be
appropriate and proper under the circumstances and in keeping with the purposes
of this Plan without seeking the approval of the Company's shareholders for such
adjustment unless such approval is required under applicable law or the rules of
the stock exchange on which shares of Stock are traded.

          13.3 Transactions Described in Section 424 of the Code. If there is a
corporate transaction described in Section 424(a) of the Code which does not
constitute a Change in Control of the Company, the Committee as part of any such
transaction shall have right to make Stock Grants, Stock Unit Grants and Option
and Stock Appreciation Right grants (without regard to any limitations set forth
under 3.4 of this Plan) to effect the assumption of, or the substitution for,
outstanding stock grants, stock unit grants and option and stock appreciation
right grants previously made by any other corporation to

                                      -27-
<PAGE>
the extent that such corporate transaction calls for such substitution or
assumption of such outstanding stock grants, stock unit grants and stock option
and stock appreciation right grants. Furthermore, if the Committee makes any
such grants as part of any such transaction, the Committee shall have the right
to increase the number of shares of Stock available for issuance under Section
3.1 by the number of shares of Stock subject to such grants without seeking the
approval of the Company's shareholders for such adjustment unless such approval
is required under applicable law or the rules of the stock exchange on which
shares of Stock are traded.

          13.4 Fractional Shares. If any adjustment under this Section 13 would
create a fractional share of Stock or a right to acquire a fractional share of
Stock under any Option, Stock Appreciation Right or Stock Grant, such fractional
share shall be disregarded and the number of shares of Stock reserved under this
Plan and the number subject to any Options or Stock Appreciation Right grants
and Stock Grants shall be the next lower number of shares of Stock, rounding all
fractions downward. An adjustment made under this Section 13 by the Committee
shall be conclusive and binding on all affected persons.

                                  Section 14.

                                CHANGE IN CONTROL

          If there is a Change in Control of the Company, then as of the Change
Effective Date for such Change in Control any and all conditions to the exercise
of all outstanding Options and Stock Appreciation Rights on such date and any
and all outstanding issuance and forfeiture conditions on any Stock Grants and
Stock Unit Grants on such date automatically shall be deemed 100% satisfied as
of such Change

                                      -28-
<PAGE>
Effective Date, and the Board shall have the right (to the extent expressly
required as part of such transaction) to cancel such Options, Stock Appreciation
Rights, Stock Grants and Stock Unit Grants after providing each Eligible
Employee and Director a reasonable period to exercise his or her Options and
Stock Appreciation Rights and to take such other action as necessary or
appropriate to receive the Stock subject to any Stock Grants and the cash
payable under any Stock Unit Grants; provided, (1) if any issuance or forfeiture
condition described in this Section 14 relates to satisfying any performance
goal and there is a target for such goal, such issuance or forfeiture condition
shall be deemed satisfied under this Section 14 only to the extent of such
target unless such target has been exceeded before the Change Effective Date, in
which event such issuance or forfeiture condition shall be deemed satisfied to
the extent such target had been so exceeded and (2) a Change in Control shall
affect a Stock Appreciation Right or Stock Unit Grant which is subject to
Section 409A of the Code only if the Change in Control also constitutes a change
in the ownership or effective control of Company or in the ownership of a
substantial portion of the assets of the Company within the meaning of Section
409A(a)(2)(A)(v) of the Code.

                                   Section 15.

                            AMENDMENT OR TERMINATION

          This Plan may be amended by the Board from time to time to the extent
that the Board deems necessary or appropriate; provided, however, (a) no
amendment shall be made absent the approval of the shareholders of the Company
to the extent such approval is required under applicable law or the rules of the
stock exchange on which shares of Stock are listed and (b) no amendment shall be
made to Section 14 on or

                                      -29-
<PAGE>
after the date of any Change in Control which might adversely affect any rights
which otherwise would vest on the related Change Effective Date. The Board also
may suspend granting Options or Stock Appreciation Rights or making Stock Grants
or Stock Unit Grants under this Plan at any time and may terminate this Plan at
any time; provided, however, the Board shall not have the right in connection
with any such suspension or termination to unilaterally to modify, amend or
cancel any Option or Stock Appreciation Right granted or Stock Grant unless (1)
the Eligible Employee or Director consents in writing to such modification,
amendment or cancellation or (2) there is a dissolution or liquidation of the
Company or a transaction described in Section 14.

                                   Section 16.

                                  MISCELLANEOUS

          16.1 Shareholder Rights. No Eligible Employee or Director shall have
any rights as a shareholder of the Company as a result of the grant of an Option
or a Stock Appreciation Right pending the actual delivery of the Stock subject
to such Option or Stock Appreciation Right to such Eligible Employee or
Director. An Eligible Employee's or a Director's rights as a shareholder in the
shares of Stock which remain subject to forfeiture under Section 9.2(b) shall be
set forth in the related Stock Grant Certificate.

          16.2 No Contract of Employment. The grant of an Option or a Stock
Appreciation Right or a Stock Grant or Stock Unit Grant to an Eligible Employee
or Director under this Plan shall not constitute a contract of employment or a
right to continue to serve on the Board and shall not confer on an Eligible
Employee or Director any rights upon his or her termination of employment or
service in addition to those

                                      -30-
<PAGE>
rights, if any, expressly set forth in this Plan or the related Option
Certificate, Stock Appreciation Right Certificate, or Stock Grant Certificate.

          16.3 Withholding. Each Option, Stock Appreciation Right, Stock Grant
and Stock Unit Grant shall be made subject to the condition that the Eligible
Employee or Director consents to whatever action the Committee directs to
satisfy the minimum statutory federal and state tax withholding requirements, if
any, which the Company determines are applicable to the exercise of such Option
or Stock Appreciation Right or to the satisfaction of any forfeiture conditions
with respect to Stock subject to a Stock Grant or Stock Unit Grant issued in the
name of the Eligible Employee or Director. No withholding shall be effected
under this Plan which exceeds the minimum statutory federal and state
withholding requirements.

          16.4 Construction. All references to sections (Section) are to
sections (Section) of this Plan unless otherwise indicated. This Plan shall be
construed under the laws of the State of Minnesota. Each term set forth in
Section 2 shall, unless otherwise stated, have the meaning set forth opposite
such term for purposes of this Plan and, for purposes of such definitions, the
singular shall include the plural and the plural shall include the singular.
Finally, if there is any conflict between the terms of this Plan and the terms
of any Option Certificate, Stock Appreciation Right Certificate or Stock Grant
Certificate, the terms of this Plan shall control.

          16.5 Other Conditions. Each Option Certificate, Stock Appreciation
Right Certificate or Stock Grant Certificate may require that an Eligible
Employee or a Director (as a condition to the exercise of an Option or a Stock
Appreciation Right or the issuance of Stock subject to a Stock Grant) enter into
any agreement or make such

                                      -31-
<PAGE>
representations prepared by the Company, including (without limitation) any
agreement which restricts the transfer of Stock acquired pursuant to the
exercise of an Option or a Stock Appreciation Right or a Stock Grant or provides
for the repurchase of such Stock by the Company.

          16.6 Rule 16b-3. The Committee shall have the right to amend any
Option, Stock Grant or Stock Appreciation Right to withhold or otherwise
restrict the transfer of any Stock or cash under this Plan to an Eligible
Employee or Director as the Committee deems appropriate in order to satisfy any
condition or requirement under Rule 16b-3 to the extent Rule 16 of the 1934 Act
might be applicable to such grant or transfer.

          16.7 Coordination with Employment Agreements and Other Agreements. If
the Company enters into an employment agreement or other agreement with an
Eligible Employee or Director which expressly provides for the acceleration in
vesting of an outstanding Option, Stock Appreciation Right, Stock Grant or Stock
Unit Grant or for the extension of the deadline to exercise any rights under an
outstanding Option, Stock Appreciation Right, Stock Grant or Stock Unit Grant,
any such acceleration or extension shall be deemed effected pursuant to, and in
accordance with, the terms of such outstanding Option, Stock Appreciation Right,
Stock Grant or Stock Unit Grant and this Plan even if such employment agreement
or other agreement is first effective after the date the outstanding Option or
Stock Appreciation Right was granted or the Stock Grant or Stock Unit Grant was
made.

                                      -32-
<PAGE>
          IN WITNESS WHEREOF, the Company has caused its duly authorized officer
to execute this Plan to evidence its adoption of this Plan.

                                        CARIBOU COFFEE COMPANY, INC.

                                        By:
                                            ------------------------------------
                                        Date:
                                              ----------------------------------

                                      -33-

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