Document:

Exhibit 4.2

 

Douglas Dynamics, L.L.C.

Douglas Dynamics Finance Company

 

(as Issuers)

 

Douglas Dynamics Holdings, Inc.

 

(as a Guarantor)

 

73⁄4% Senior Notes due 2012

 

 

INDENTURE

 

Dated as of December 16, 2004

 

 

U.S. Bank National Association

 

(as Trustee)

 

 

TABLE OF CONTENTS

 

	
   

  	
   

  	
  Page

  
	
   

  	
   

  	
   

  
	
  ARTICLE
  I

  	
  DEFINITIONS
  AND INCORPORATION BY REFERENCE

  	
  1

  
	
   

  	
   

  	
   

  
	
  Section 1.1

  	
  Definitions

  	
  1

  
	
  Section 1.2

  	
  Other
  Definitions

  	
  25

  
	
  Section 1.3

  	
  Incorporation
  by Reference of Trust Indenture Act

  	
  26

  
	
  Section 1.4

  	
  Rules of
  Construction

  	
  26

  
	
   

  	
   

  	
   

  
	
  ARTICLE
  II

  	
  THE
  NOTES

  	
  27

  
	
   

  	
   

  	
   

  
	
  Section 2.1

  	
  Form and
  Dating

  	
  27

  
	
  Section 2.2

  	
  Execution
  and Authentication

  	
  28

  
	
  Section 2.3

  	
  Registrar,
  Paying Agent and Depositary

  	
  28

  
	
  Section 2.4

  	
  Paying
  Agent to Hold Money in Trust

  	
  29

  
	
  Section 2.5

  	
  Holder
  Lists

  	
  29

  
	
  Section 2.6

  	
  Transfer
  and Exchange

  	
  29

  
	
  Section 2.7

  	
  Replacement
  Notes

  	
  39

  
	
  Section 2.8

  	
  Outstanding
  Notes

  	
  39

  
	
  Section 2.9

  	
  Treasury
  Notes

  	
  39

  
	
  Section 2.10

  	
  Temporary
  Notes

  	
  39

  
	
  Section 2.11

  	
  Cancellation

  	
  40

  
	
  Section 2.12

  	
  Defaulted
  Interest

  	
  40

  
	
  Section 2.13

  	
  CUSIP
  Numbers

  	
  41

  
	
  Section 2.14

  	
  Issuance
  of Additional Notes

  	
  41

  
	
   

  	
   

  	
   

  
	
  ARTICLE
  III

  	
  REDEMPTION

  	
  41

  
	
   

  	
   

  	
   

  
	
  Section 3.1

  	
  Notices
  to Trustee

  	
  41

  
	
  Section 3.2

  	
  Selection
  of Notes to Be Redeemed

  	
  42

  
	
  Section 3.3

  	
  Notice
  of Redemption

  	
  42

  
	
  Section 3.4

  	
  Effect
  of Notice of Redemption

  	
  43

  
	
  Section 3.5

  	
  Deposit
  of Redemption Price

  	
  43

  
	
  Section 3.6

  	
  Notes
  Redeemed in Part

  	
  43

  
	
  Section 3.7

  	
  Optional
  Redemption

  	
  43

  
	
  Section 3.8

  	
  No
  Mandatory Redemption

  	
  44

  
	
   

  	
   

  	
   

  
	
  ARTICLE
  IV

  	
  COVENANTS

  	
  44

  
	
   

  	
   

  	
   

  
	
  Section 4.1

  	
  Payment
  of Notes

  	
  44

  
	
  Section 4.2

  	
  Maintenance
  of Office or Agency

  	
  45

  
	
  Section 4.3

  	
  Reports
  to Holders

  	
  45

  
	
  Section 4.4

  	
  Compliance
  Certificate

  	
  46

  
	
  Section 4.5

  	
  Taxes

  	
  47

  
	
  Section 4.6

  	
  Stay,
  Extension and Usury Laws

  	
  47

  
	
  Section 4.7

  	
  Limitation
  on Incurrence Of Additional Indebtedness and Disqualified Capital Stock

  	
  47

  
	
  Section 4.8

  	
  Limitation
  on Liens

  	
  49

  
	
  Section 4.9

  	
  Limitation
  on Restricted Payments

  	
  49

  
	
  Section 4.10

  	
  Limitation
  on Dividends and Other Payment Restrictions Affecting Subsidiaries

  	
  52

  

 

i

 

	
  Section 4.11

  	
  Limitation
  on Lines of Business

  	
  53

  
	
  Section 4.12

  	
  Limitation
  on Transactions with Affiliates

  	
  53

  
	
  Section 4.13

  	
  Limitation
  on Sale Of Assets And Subsidiary Stock

  	
  54

  
	
  Section 4.14

  	
  Repurchase
  of Notes at the Option of the Holder Upon a Change of Control

  	
  56

  
	
  Section 4.15

  	
  Subsidiary
  Guarantors

  	
  58

  
	
  Section 4.16

  	
  Limitation
  On Status As Investment Company

  	
  58

  
	
  Section 4.17

  	
  Maintenance
  of Properties

  	
  58

  
	
  Section 4.18

  	
  Corporate
  Existence

  	
  58

  
	
   

  	
   

  	
   

  
	
  ARTICLE
  V

  	
  SUCCESSORS

  	
  59

  
	
   

  	
   

  	
   

  
	
  Section 5.1

  	
  Merger,
  Consolidation or Sale of Assets

  	
  59

  
	
  Section 5.2

  	
  Successor
  Corporation Substituted

  	
  60

  
	
   

  	
   

  	
   

  
	
  ARTICLE
  VI

  	
  DEFAULTS
  AND REMEDIES

  	
  60

  
	
   

  	
   

  	
   

  
	
  Section 6.1

  	
  Events
  of Default

  	
  60

  
	
  Section 6.2

  	
  Acceleration

  	
  61

  
	
  Section 6.3

  	
  Other
  Remedies

  	
  62

  
	
  Section 6.4

  	
  Waiver
  of Past Defaults

  	
  63

  
	
  Section 6.5

  	
  Control
  by Majority

  	
  63

  
	
  Section 6.6

  	
  Limitation
  on Suits

  	
  63

  
	
  Section 6.7

  	
  Rights
  of Holders of Notes to Receive Payment

  	
  64

  
	
  Section 6.8

  	
  Collection
  Suit by Trustee

  	
  64

  
	
  Section 6.9

  	
  Trustee
  May File Proofs of Claim

  	
  64

  
	
  Section 6.10

  	
  Priorities

  	
  65

  
	
  Section 6.11

  	
  Undertaking
  for Costs

  	
  65

  
	
   

  	
   

  	
   

  
	
  ARTICLE
  VII

  	
  TRUSTEE

  	
  65

  
	
   

  	
   

  	
   

  
	
  Section 7.1

  	
  Duties
  of Trustee

  	
  65

  
	
  Section 7.2

  	
  Rights
  of Trustee

  	
  66

  
	
  Section 7.3

  	
  Individual
  Rights of Trustee

  	
  67

  
	
  Section 7.4

  	
  Trustee’s
  Disclaimer

  	
  68

  
	
  Section 7.5

  	
  Notice
  of Defaults

  	
  68

  
	
  Section 7.6

  	
  Reports
  by Trustee to Holders of the Notes

  	
  68

  
	
  Section 7.7

  	
  Compensation
  and Indemnity

  	
  68

  
	
  Section 7.8

  	
  Replacement
  of Trustee

  	
  69

  
	
  Section 7.9

  	
  Successor
  Trustee by Merger, etc.

  	
  70

  
	
  Section 7.10

  	
  Eligibility;
  Disqualification

  	
  70

  
	
  Section 7.11

  	
  Preferential
  Collection of Claims Against Issuers

  	
  70

  
	
   

  	
   

  	
   

  
	
  ARTICLE
  VIII      LEGAL DEFEASANCE AND COVENANT DEFEASANCE
  AND SATISFACTION AND  DISCHARGE

  	
  71

  
	
   

  	
   

  	
   

  
	
  Section 8.1

  	
  Option
  to Effect Legal Defeasance or Covenant Defeasance

  	
  71

  
	
  Section 8.2

  	
  Legal
  Defeasance and Discharge

  	
  71

  
	
  Section 8.3

  	
  Covenant
  Defeasance

  	
  71

  
	
  Section 8.4

  	
  Conditions
  to Legal or Covenant Defeasance

  	
  72

  
	
  Section 8.5

  	
  Deposited
  Money and Government Securities to be Held in Trust; Other Miscellaneous
  Provisions

  	
  73

  
	
  Section 8.6

  	
  Repayment
  to Issuers

  	
  73

  
	
  Section 8.7

  	
  Reinstatement

  	
  74

  
	
  Section 8.8

  	
  Satisfaction
  and Discharge

  	
  74

  

 

ii

 

	
  ARTICLE
  IX

  	
  AMENDMENT,
  SUPPLEMENT AND WAIVER

  	
  75

  
	
   

  	
   

  	
   

  
	
  Section 9.1

  	
  Without
  Consent of Holders of Notes

  	
  75

  
	
  Section 9.2

  	
  With
  Consent of Holders of Notes

  	
  76

  
	
  Section 9.3

  	
  Compliance
  with Trust Indenture Act

  	
  77

  
	
  Section 9.4

  	
  Revocation
  and Effect of Consents

  	
  77

  
	
  Section 9.5

  	
  Notation
  on or Exchange of Notes

  	
  78

  
	
  Section 9.6

  	
  Trustee
  to Sign Amendments, etc.

  	
  78

  
	
   

  	
   

  	
   

  
	
  ARTICLE
  X

  	
  GUARANTEES

  	
  78

  
	
   

  	
   

  	
   

  
	
  Section 10.1

  	
  Guarantees

  	
  78

  
	
  Section 10.2

  	
  Execution
  and Delivery of Guarantees

  	
  79

  
	
  Section 10.3

  	
  Guarantors
  May Consolidate, etc., on Certain Terms

  	
  80

  
	
  Section 10.4

  	
  Release
  of Guarantors

  	
  81

  
	
  Section 10.5

  	
  Limitation
  of Guarantor’s Liability; Certain Bankruptcy Events

  	
  81

  
	
  Section 10.6

  	
  Application
  of Certain Terms and Provisions to the Guarantors

  	
  82

  
	
   

  	
   

  	
   

  
	
  ARTICLE
  XI

  	
  MISCELLANEOUS

  	
  82

  
	
   

  	
   

  	
   

  
	
  Section 11.1

  	
  Trust
  Indenture Act Controls

  	
  82

  
	
  Section 11.2

  	
  Notices

  	
  82

  
	
  Section 11.3

  	
  Communication
  by Holders of Notes with Other Holders of Notes

  	
  83

  
	
  Section 11.4

  	
  Certificate
  and Opinion as to Conditions Precedent

  	
  83

  
	
  Section 11.5

  	
  Statements
  Required in Certificate or Opinion

  	
  84

  
	
  Section 11.6

  	
  Rules by
  Trustee and Agents

  	
  84

  
	
  Section 11.7

  	
  No
  Personal Liability of Directors, Officers, Employees and Stockholders

  	
  84

  
	
  Section 11.8

  	
  Governing
  Law

  	
  84

  
	
  Section 11.9

  	
  No
  Adverse Interpretation of Other Agreements

  	
  85

  
	
  Section 11.10

  	
  Successors

  	
  85

  
	
  Section 11.11

  	
  Severability

  	
  85

  
	
  Section 11.12

  	
  Counterpart
  Originals

  	
  85

  
	
  Section 11.13

  	
  Table
  of Contents, Headings, Etc.

  	
  85

  
	
   

  	
   

  	
   

  
	
  EXHIBIT
  A

  	
   

  	
   

  
	
  FORM OF NOTE

  	
  A-1

  
	
   

  	
   

  	
   

  
	
  EXHIBIT
  B

  	
   

  	
   

  
	
  FORM OF CERTIFICATE OF TRANSFER

  	
  B-1

  
	
   

  	
   

  	
   

  
	
  EXHIBIT
  C

  	
   

  	
   

  
	
  FORM OF CERTIFICATE OF EXCHANGE

  	
  C-1

  
	
   

  	
   

  	
   

  
	
  EXHIBIT
  D

  	
   

  	
   

  
	
  FORM OF SUPPLEMENTAL
  INDENTURE TO BE DELIVERED BY SUBSEQUENT GUARANTORS

  	
  D-1

  

 

iii

 

INDENTURE, dated as of December 16, 2004, among
Douglas Dynamics, L.L.C., a Delaware limited liability company (the “Company”),
Douglas Dynamics Finance Company, a Delaware corporation (“Finance Company,”
and together with the Company, the “Issuers”), Douglas Dynamics Holdings, Inc.,
as a Guarantor hereunder, and U.S. Bank National Association, as trustee (the “Trustee”).

 

Each party agrees as follows for the benefit of each
other and for the equal and ratable benefit of the Holders of the Issuers’ 73⁄4%
Senior Notes due 2012 (the “Notes”):

 

ARTICLE I

 

DEFINITIONS AND
INCORPORATION

BY REFERENCE

 

Section 1.1                                                              Definitions

 

“144A Global Note”
means one or more Global Notes bearing the Private Placement Legend that shall
be issued in an aggregate amount of denominations equal in total to the
outstanding principal amount of the Notes sold in reliance on Rule 144A.

 

“Accrued Bankruptcy
Interest” means, with respect to any Indebtedness, all interest
accruing thereon after the filing of a petition by or against an Issuer or any
of their respective Subsidiaries or any parent under any Bankruptcy Law, in
accordance with and at the rate (including any rate applicable upon any default
or event of default, to the extent lawful) specified in the documents
evidencing or governing such Indebtedness, whether or not the claim for such
interest is allowed as a claim after such filing in any proceeding under such
Bankruptcy Law.

 

“Acquired Indebtedness”
means Indebtedness (including Disqualified Capital Stock) of any Person
existing at the time such Person becomes a Subsidiary, including by
designation, or is merged or consolidated into or with an Issuer or a
Subsidiary.

 

“Acquisition”
means the purchase or other acquisition of any Person or all or substantially
all the assets of any Person by any other Person, whether by purchase, merger,
consolidation, or other transfer, and whether or not for consideration.

 

“Additional Assets”
means (i) any property or assets (other than Indebtedness and Equity
Interests) to be used by an Issuer or a Subsidiary in a Related Business, (ii) the
Equity Interests of a Person that becomes a Subsidiary as a result of the
acquisition of such Equity Interests by an Issuer or another Subsidiary, or (iii) Equity
Interests constituting a minority of interest in any Person that at such time
is a Subsidiary; provided that, in the case of
clauses (ii) and (iii), such Subsidiary is engaged in a Related Business.

 

“Additional Notes”
means additional Notes which may be issued after the Issue Date pursuant to
this Indenture (other than in exchange for or in replacement of outstanding
Notes).  All references herein to “Notes” shall be deemed to include Additional Notes.

 

“Affiliate”
means any Person directly or indirectly controlling or controlled by or under
direct or indirect common control with an Issuer.  For purposes of this definition, the term “control”
means the power to direct the management and policies of a Person, directly or
through one or more intermediaries, whether through the ownership of voting
securities, by contract, or 

 

 

otherwise; provided that with respect to ownership interest in an
Issuer and its Subsidiaries, a Beneficial Owner of 10% or more of the total
voting power normally entitled to vote in the election of directors, managers
or trustees, as applicable, shall for such purposes be deemed to possess
control.  Notwithstanding the foregoing,
Affiliate shall not include Wholly Owned Subsidiaries.

 

“Agent” means
any Registrar, Paying Agent or co-registrar.

 

“Applicable Procedures”
means, with respect to any transfer or exchange of or for beneficial interests
in any Global Note, the rules and procedures of the Depositary, Euroclear
and Clearstream that apply to such transfer or exchange at the relevant time.

 

“Attributable Indebtedness”
in respect of a sale and leaseback transaction means, at the time of
determination, the present value of the obligation of the lessee for net rental
payments during the remaining term of the lease included in such sale and
leaseback transaction including any period for which such lease has been
extended or may, at the option of the lessor, be extended.  Such present value shall be calculated using
a discount rate equal to the rate of interest implicit in such transaction,
determined in accordance with GAAP.

 

“Average Life”
means, as of the date of determination, with respect to any security or
instrument, the quotient obtained by dividing (1) the sum of the products (a) of
the number of years from the date of determination to the date or dates of each
successive scheduled principal (or redemption) payment of such security or
instrument and (b) the amount of each such respective principal (or
redemption) payment by (2) the sum of all such principal (or redemption)
payments.

 

“Bankruptcy Code”
means the United States Bankruptcy Code, codified at 11 U.S.C. § 101-1330,
as amended.

 

“Bankruptcy Law”
means Title 11, U.S. Code, or any similar Federal, state or foreign law for the
relief of debtors.

 

“Beneficial Owner”
or “beneficial owner” (a) for purposes
of the definition of Affiliate has the meaning attributed to it in Rules 13d-3
and 13d-5 under the Exchange Act (as in effect on the Issue Date), whether or
not applicable, and (b) for purposes of the definition of Change of
Control as set forth below has the meaning attributed to it in Rules 13d-3
and 13d-5 under the Exchange Act (as in effect on the Issue Date), whether or
not applicable; provided, that the applicable
Person shall be deemed to have “beneficial ownership” of all shares that such Person
has the right to acquire, whether such right is exercisable immediately or only
after the passage of time; provided, further, that any person granting a proxy to, or otherwise
agreeing that it will vote in a manner consistent with, any Excluded Person
shall be deemed not to have beneficial ownership of any shares held by such
Excluded Person or beneficial ownership of any shares held by any other Person
granting a proxy to, or otherwise agreeing that it will vote in a manner
consistent with, such Excluded Person.

 

“Board of Directors”
means, so long as Parent directly owns all of the Equity Interests of the
Company and the Parent Guarantee is in effect, the board of directors of
Parent; provided, however,
that if Parent no longer directly owns all of the Equity Interests of the
Company or the Parent Guarantee is no longer in effect, the board of directors
or the equivalent body performing similar functions of the Company, and, with
respect to any other Person, the board of directors (or, if such Person is not
a corporation, the equivalent body performing similar 

 

2

 

functions for such Person)
of such Person or any committee of the board of directors of such Person
authorized, with respect to any particular matter, to exercise the power of the
board of directors of such Person.

 

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

 

“Capital Contribution”
means any contribution to the equity of the Company from a direct or indirect
parent of the Company for which no consideration other than the issuance of
Qualified Capital Stock is given.

 

“Capitalized Lease
Obligation” means, as to any Person, the obligations of such Person
under a lease that are required to be classified and accounted for as capital
lease obligations under GAAP and, for purposes of this definition, the amount
of such obligations at any date shall be the capitalized amount of such
obligations at such date, determined in accordance with GAAP.

 

“Capital Stock”
means, with respect to any corporation, any and all shares, interests, rights
to purchase (other than convertible or exchangeable Indebtedness that is not
itself otherwise capital stock), warrants, options, participations or other
equivalents of or interests (however designated) in stock issued by that
corporation.

 

“Cash Equivalent”
means:  (1) marketable securities (a) issued
or directly and unconditionally guaranteed by the United States of America or (b) issued
by any agency of the United States of America the obligations of which are
backed by the full faith and credit of the United States of America, in each
case maturing within one year after such date; (2) marketable direct
obligations issued by any state of the United States of America or any
political subdivision of any such state or any public instrumentality thereof,
in each case maturing within one year after such date and having, at the time
of the acquisition thereof, a rating of at least A-1 from S&P or at least
P-1 from Moody’s; (3) commercial paper maturing no more than one year from
the date of creation thereof and having, at the time of the acquisition
thereof, a rating of at least A-1 from S&P or at least P-1 from Moody’s; (4) demand
deposits, certificates of deposit, time deposits or bankers’ acceptances, in
each case maturing within one year after such date and issued by any lender
party to the Credit Agreement or by any commercial bank organized under the
laws of the United States of America or any state thereof or the District of
Columbia of recognized standing having capital and surplus of not less than
$250,000,000; and (5) shares of any money market mutual fund that (a) has
at least 95% of its assets invested continuously in the types of investments
referred to in clauses (1) and (2) above, (b) has net assets of
not less than $500,000,000, and (c) has the highest rating obtainable from
either S&P or Moody’s.

 

“Change of Control”
means (1) the sale, conveyance, exchange, transfer, lease or other
disposition (other than by way of merger or consolidation), directly or
indirectly, in one or a series of related transactions, of all or substantially
all of the assets of the Company and its Subsidiaries taken as a whole to any “person”
(including any group that is deemed to be a “person”), other than Excluded
Persons; (2) the adoption of a plan relating to the liquidation or
dissolution of Parent or an Issuer; provided, that
the Company may liquidate into Parent, and Finance Company may liquidate into
the Company, in each case so long as the conditions set forth under Section 5.1
are met treating such liquidation as if it had been a merger of such entities; (3) (A) at
any time that the Company is a Subsidiary of Parent, the consummation of any
transaction (including, without limitation, any merger or consolidation) the
result of which is that 

 

3

 

any “person” (including any group
that is deemed to be a “person”), other than Excluded Persons, becomes the “beneficial
owner,” directly or indirectly, of Voting Equity Interests of Parent entitled
to elect at least a majority of the members of the Board of Directors of
Parent; and (B) at any time that the Company is not a Subsidiary of
Parent, the consummation of any transaction (including, without limitation, any
merger or consolidation) the result of which is that any “person” (including
any group that is deemed to be a “person”), other than Excluded Persons,
becomes the “beneficial owner,” directly or indirectly, of Voting Equity
Interests of the Company entitled to elect at least a majority of the members
of the Board of Directors of the Company; (4) the Continuing Directors
cease for any reason to constitute a majority of the Board of Directors of
Parent or the Company, as the case may be, then in office; or (5) the
Company shall cease to own beneficially and of record all of the Equity
Interests of Finance Company, except as permitted by clause (2) above and
by Section 5.1.

 

As used in this definition, “person” (including any
group that is deemed to be a “person”) has the meaning given by Section 13(d) of
the Exchange Act, whether or not applicable.

 

“Clearstream”
means Clearstream Banking, S.A., or its successors.

 

“Commission” or “SEC” means the United States Securities and Exchange
Commission, or any successor agency.

 

“Consolidated Amortization
Expense” of any Person for any period means the amortization expense
of such Person and its Consolidated Subsidiaries for such period, determined in
accordance with GAAP.

 

“Consolidated Coverage
Ratio” of any Person on any date of determination (the “Transaction
Date”) means the ratio, on a pro forma
basis, of (a) the aggregate amount of Consolidated EBITDA of such Person
for the Reference Period to (b) the aggregate Consolidated Fixed Charges
of such Person during the Reference Period; provided, that
for purposes of such calculation:  (1) Acquisitions
which occurred during the Reference Period or subsequent to the Reference
Period and on or prior to the Transaction Date shall be assumed to have
occurred on the first day of the Reference Period, (2) transactions giving
rise to the need to calculate the Consolidated Coverage Ratio and the application
of the proceeds therefrom (except as otherwise provided in this definition)
shall be assumed to have occurred on the first day of the Reference Period, (3) the
incurrence of any Indebtedness (including the issuance of any Disqualified
Capital Stock) during the Reference Period or subsequent to the Reference
Period and on or prior to the Transaction Date (and the application of the
proceeds therefrom to the extent used to refinance or retire other
Indebtedness) (other than ordinary working capital borrowings) shall be assumed
to have occurred on the first day of the Reference Period, (4) the
Consolidated Fixed Charges of such Person attributable to interest on any
Indebtedness or dividends on any Disqualified Capital Stock bearing a floating
interest (or dividend) rate shall be computed on a pro forma
basis as if the average rate in effect from the beginning of the Reference
Period to the Transaction Date had been the applicable rate for the entire
period, unless such Person or any of its Subsidiaries is a party to an Interest
Swap or Hedging Obligation (which shall remain in effect for the 12-month
period immediately following the Transaction Date) that has the effect of
fixing the interest rate on the date of computation, in which case such rate (whether
higher or lower) shall be used, and (5) amounts attributable to operations
or businesses permanently discontinued or disposed of prior to the Transaction
Date, shall be excluded, except, in the case of a determination of Consolidated
Fixed Charges, only to the extent that the obligations giving rise to such 

 

4

 

Consolidated Fixed Charges
would no longer be obligations contributing to such Person’s Consolidated Fixed
Charges subsequent to the Transaction Date.

 

“Consolidated Depreciation
Expense” for any Person for any period means the depreciation
expense of such Person and its Consolidated Subsidiaries for such period,
determined in accordance with GAAP.

 

“Consolidated EBITDA”
means, with respect to any Person, for any period, the Consolidated Net Income
of such Person for such period adjusted to add thereto (to the extent deducted
from net sales in determining Consolidated Net Income), without duplication,
the sum of:  (1) Consolidated Income
Tax Expense, (2) Consolidated Amortization Expense (but only to the extent
not included in Consolidated Fixed Charges), (3) Consolidated Depreciation
Expense, (4) Consolidated Fixed Charges, (5) non-cash impairment
charges, (6) non-cash expenses resulting from the grant of stock and stock
options and other compensation to management personnel of the Company and its
Subsidiaries pursuant to a written incentive plan or agreement, (7) other
non-cash items that are unusual or otherwise non-recurring items, (8) fees
and expenses paid pursuant to the Management Services Agreement in accordance
with the terms thereof in effect on the Issue Date, and (9) fees and
expenses paid in connection with the Refinancing Transactions and the write off
of previously capitalized deferred financing costs occurring as a result of the
repayment of Indebtedness in the Refinancing Transactions, less (i) non-cash
items increasing Consolidated Net Income of such Person for such period that
are unusual or otherwise non-recurring items, and (ii) the amount of all
cash payments made by such Person or any of its Subsidiaries during such period
to the extent such payments relate to non-cash charges that were added back in
determining Consolidated EBITDA for such period or any prior period; provided, that Consolidated Income Tax Expense, Consolidated
Amortization Expense and Consolidated Depreciation Expense of a Subsidiary that
is a less than Wholly Owned Subsidiary shall only be added to the extent of the
equity interest of such Person in such Subsidiary.

 

“Consolidated Fixed Charges”
of any Person means, for any period, the aggregate amount (without duplication
and determined in each case in accordance with GAAP) of:  (a) interest expensed or capitalized,
paid, accrued, or scheduled to be paid or accrued (including, in accordance
with the following sentence, interest attributable to Capitalized Lease
Obligations and Attributable Indebtedness) of such Person and its Consolidated
Subsidiaries during such period, including (1) amortization of debt issuance
costs, original issue discount, debt discounts or premium and other financing
fees and expenses and non-cash interest payments or accruals on any
Indebtedness, (2) the interest portion of all deferred payment
obligations, and (3) all commissions, discounts and other fees and charges
owed with respect to bankers’ acceptances and letters of credit financings and
currency and Interest Swap and Hedging Obligations, in each case to the extent
attributable to such period, and (b) the amount of all dividends accrued
or payable (whether or not in cash) by such Person or any of its Consolidated
Subsidiaries in respect of Preferred Stock (other than (i) dividends on
Equity Interests (other than Disqualified Capital Stock) of such Person payable
solely in Equity Interests (other than Disqualified Capital Stock) of such
Person, and (ii) by Subsidiaries of such Person to such Person or such
Person’s Wholly Owned Subsidiaries).  For
purposes of this definition, (x) interest on a Capitalized Lease
Obligation shall be deemed to accrue at an interest rate reasonably determined
in good faith by such Person to be the rate of interest implicit in such
Capitalized Lease Obligation in accordance with GAAP and (y) interest
expense attributable to any Indebtedness represented by the guarantee by such
Person or a Subsidiary of such Person of an obligation of another Person shall
be deemed to be the interest expense attributable to the Indebtedness
guaranteed.

 

5

 

“Consolidated Income Tax
Expense” for any Person for any period means the provision for
federal, state, local and foreign income taxes of such Person and its
Consolidated Subsidiaries, determined in accordance with GAAP; and, in the case
of the Company, shall include, without duplication, amounts permitted to be
paid to Parent in respect of such period pursuant to clause (b) of the
definition of Permitted Payments to Parent.

 

“Consolidated Interest
Expense” of any Person means, for any period, the aggregate amount
(without duplication and determined in each case in accordance with GAAP)
of:  (a) interest expensed or
capitalized, paid, accrued, or scheduled to be paid or accrued (including, in
accordance with the following sentence, interest attributable to Capitalized
Lease Obligations and Attributable Indebtedness) of such Person and its
Consolidated Subsidiaries during such period, including (1) amortization
of debt issuance costs, original issue discount, debt discounts or premium and
other financing fees and expenses and non-cash interest payments or accruals on
any Indebtedness, (2) the interest portion of all deferred payment
obligations, and (3) all commissions, discounts and other fees and charges
owed with respect to bankers’ acceptances and letters of credit financings and
currency and Interest Swap and Hedging Obligations, in each case to the extent
attributable to such period, and (b) the amount of all cash dividends paid
by such Person or any of its Consolidated Subsidiaries in respect of Preferred
Stock (other than by Subsidiaries of such Person to such Person or such Person’s
Wholly Owned Subsidiaries).  For purposes
of this definition, (x) interest on a Capitalized Lease Obligation shall
be deemed to accrue at an interest rate reasonably determined in good faith by
such Person to be the rate of interest implicit in such Capitalized Lease
Obligation in accordance with GAAP and (y) interest expense attributable
to any Indebtedness represented by the guarantee by such Person or a Subsidiary
of such Person of an obligation of another Person shall be deemed to be the
interest expense attributable to the Indebtedness guaranteed.

 

“Consolidated Net Debt to
EBITDA Ratio” of any Person as of any date of determination means
the ratio, on a pro forma basis, of (x) (A) the
aggregate amount of outstanding Indebtedness of such Person and its
Consolidated Subsidiaries, less (B) the aggregate amount of cash of such
Person and its Consolidated Subsidiaries appearing on the consolidated balance
sheet of such Person and its Consolidated Subsidiaries, in each case as of the
end of the most recent fiscal quarter included in the Reference Period, to (y) the
aggregate amount of Consolidated EBITDA of such Person for the Reference
Period, in each of (x) and (y) with such pro forma
adjustments as are consistent with the pro forma
adjustment provisions set forth in the definition of Consolidated Coverage
Ratio; provided, that with respect to the
Company, to avoid duplication, a guarantee of Indebtedness of an Issuer or any
Subsidiary Guarantor incurred in accordance with the terms of the Indenture
will not constitute a separate amount of outstanding Indebtedness for purposes
of this definition.

 

“Consolidated Net Income”
means, with respect to any Person for any period, the net income (or loss) of such
Person and its Consolidated Subsidiaries (determined on a consolidated basis in
accordance with GAAP) for such period, adjusted to exclude (only to the extent
included in computing such net income (or loss) and without duplication):  (a) all gains and losses which are
either extraordinary (as determined in accordance with GAAP) or are
nonrecurring (including any gain from the sale or other disposition of assets
outside the ordinary course of business or from the issuance or sale of any
capital stock), (b) the net income, if positive, of any Person, other than
a Consolidated Subsidiary, in which such Person or any of its Consolidated
Subsidiaries has an interest, except to the extent of the amount of any
dividends or distributions actually paid in cash to such Person or a
Consolidated Subsidiary of such Person during such period, (c) the net
income, if positive, of any of such Person’s Consolidated Subsidiaries to the
extent that the declaration or payment of dividends or similar distributions is

 

6

 

not at the time permitted by
operation of the terms of its charter or bylaws or any other agreement,
instrument, judgment, decree, order, statute, rule or governmental
regulation applicable to such Consolidated Subsidiary, and (d) the net
income of any Unrestricted Subsidiary of such Person, except to the extent of
the amount of any dividends or distributions actually paid in cash to such
Person or a Consolidated Subsidiary of such Person during such period.  In addition, to the extent not deducted from
net sales in determining Consolidated Net Income, Consolidated Net Income of
the Company shall be reduced by, without duplication, (A) the amount of
any Permitted Payments to Parent made during such period in accordance with
clauses (a) and (c) of the definition thereof and, (B) any
Permitted Payments to Parent that are permitted to be paid in respect of such
period in accordance with clause (b) of the definition thereof.

 

“Consolidated Secured Debt
Ratio” means, for any Person, as of any date of determination, the
ratio of (x) total outstanding Indebtedness of such Person and its
Consolidated Subsidiaries that is secured by Liens as of the end of the most
recent fiscal quarter included in the Reference Period, to (y) the
aggregate amount of Consolidated EBITDA of such Person for the Reference
Period, in each case with such pro forma
adjustments as are consistent with the pro forma
adjustment provisions set forth in the definition of Consolidated Coverage
Ratio; provided, that with respect to the
Company, to avoid duplication, a guarantee of Indebtedness of an Issuer or any
Subsidiary Guarantor incurred and secured by Liens in accordance with the terms
of this Indenture will not constitute a separate amount of outstanding
Indebtedness secured by Liens for purposes of this definition.

 

“Consolidated Subsidiary”
means, for any Person, each Subsidiary of such Person (whether now existing or
hereafter created or acquired) the financial statements of which are
consolidated for financial statement reporting purposes with the financial
statements of such Person in accordance with GAAP.

 

“Consolidation”
means, with respect to the Company, the consolidation of the accounts of the
Subsidiaries with those of the Company, all in accordance with GAAP; provided, that “consolidation” will not include
consolidation of the accounts of any Unrestricted Subsidiary with the accounts
of the Company.  The term “consolidated” has a correlative meaning to the foregoing.

 

“Continuing Director”
means during any period of 12 consecutive months after the Issue Date,
individuals who at the beginning of any such 12-month period constituted the
Board of Directors (together with any new directors whose election by the Board
of Directors or whose nomination for election by the holders of the Voting
Equity Interests of Parent or the Company, as applicable, was approved by a
vote of a majority of the directors then still in office who were either
directors at the beginning of such period or whose election or nomination for
election was previously so approved, including new directors designated in or
provided for in an agreement regarding the merger, consolidation or sale,
transfer or other conveyance, of all or substantially all of the assets of the
Parent or the Company, as applicable, if such agreement was approved by a vote
of such majority of directors).

 

“Corporate Trust Office”
means the principal office of the Trustee at which at any time, its corporate
trust business shall be administered, which office at the date hereof is
located at 60 Livingston Avenue, St. Paul, Minnesota, 55107-2292, or such other
address as the Trustee may designate from time to time by written notice to the
Issuers, or the principal corporate trust office of any successor Trustee (or
such other address as such successor Trustee may designate from time to time by
written notice to the Issuers).

 

7

 

“Credit Agreement”
means the Amended and Restated First Lien Credit and Guaranty Agreement, dated
as of the Issue Date, by and among the Company, as issuer, Finance Company and
Parent, as guarantors, certain financial institutions named therein and Credit
Suisse First Boston, as administrative agent, providing for (A) an
aggregate $50.0 million term loan facility, and (B) an aggregate $55.0
million revolving credit facility, including any related notes, guarantees,
collateral documents, instruments and agreements executed in connection
therewith, as such credit agreement and/or related documents may be amended,
restated, supplemented, renewed, replaced or otherwise modified from time to
time whether or not with the same agent, trustee, representative lenders or
holders, and, subject to the proviso to the next succeeding sentence,
irrespective of any changes in the terms and conditions thereof.  Without limiting the generality of the
foregoing, the term “Credit Agreement” shall include agreements in respect of
Interest Swap and Hedging Obligations with Persons that are or have been
lenders (or Affiliates thereof) party to the Credit Agreement and shall also
include any amendment, amendment and restatement, renewal, extension,
restructuring, supplement or modification to any Credit Agreement and all
refundings, refinancings and replacements of any Credit Agreement, including
any credit agreement:

 

(1)           extending the maturity of any Indebtedness incurred
thereunder or contemplated thereby,

 

(2)           adding or deleting borrowers or guarantors thereunder, so
long as borrowers and issuers include one or more of the Issuers and their
Subsidiaries and their respective successors and assigns,

 

(3)           increasing the amount of Indebtedness incurred thereunder
or available to be borrowed thereunder; provided,
that on the date such Indebtedness is incurred it would not be prohibited by Section 4.7,
or

 

(4)           otherwise altering the terms and conditions thereof in a
manner not prohibited by the terms of this Indenture.

 

“Cumulative Operating
EBITDA” means, for the period commencing on the first day of the
first full fiscal quarter commencing after the Issue Date through and including
the end of the last fiscal quarter (taken as one accounting period) preceding
the date of any proposed Restricted Payment, Consolidated EBITDA of the Company
for such period.

 

“Cumulative Total Interest
Expense” means, for the period commencing on the first day of the
first full fiscal quarter commencing after the Issue Date through and including
the end of the last fiscal quarter (taken as one accounting period) preceding
the date of any proposed Restricted Payment, Consolidated Interest Expense of
the Company for such period.

 

“Custodian”
means any receiver, trustee, assignee, liquidator or similar official under any
Bankruptcy Law.

 

“Default” means
any event that is or with the passage of time or the giving of notice or both
would be an Event of Default.

 

“Definitive Note”
means one or more certificated Notes registered in the name of the Holder
thereof and issued in accordance with Section 2.6 hereof, in the form of Exhibit A
hereto except that such Note shall not include the information called for by
footnotes 2, 3, 4 and 9 thereof.

 

8

 

“Depositary”
means, with respect to the Notes issuable or issued in whole or in part in
global form, the Person specified in Section 2.3 hereof as the Depositary
with respect to the Notes, until a successor shall have been appointed and
become such pursuant to the applicable provisions of this Indenture, and
thereafter “Depositary” shall mean or include such successor.

 

“Disqualified Capital Stock”
means with respect to any Person, (a) Equity Interests of such Person
that, by its terms or by the terms of any security into which it is
convertible, exercisable or exchangeable, is, or upon the happening of an event
or the passage of time or both would be, required to be redeemed or repurchased
including at the option of the holder thereof by such Person or any of its
Subsidiaries, in whole or in part, on or prior to 91 days following the Stated
Maturity of the Notes and (b) any Equity Interests of any Subsidiary of
such Person other than any common equity with no preferences, privileges, and
no redemption or repayment provisions. 
Notwithstanding the foregoing, any Equity Interests of an Issuer that
would constitute Disqualified Capital Stock solely because the holders thereof
have the right to require such Issuer to repurchase such Equity Interests upon
the occurrence of a change of control or an asset sale shall not constitute
Disqualified Capital Stock if the terms of such Equity Interests provide that
such Issuer may not repurchase or redeem any such Equity Interests pursuant to
such provisions prior to such Issuer’s purchase of the Notes as are required to
be purchased pursuant to the provisions of the Indenture as described under
Sections 4.13 and 4.14 hereof.

 

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

 

“Equity Interests”
means Capital Stock or partnership, participation or membership interests and
all warrants, options or other rights to acquire Capital Stock or partnership,
participation or membership interests (but excluding any debt security that is
convertible into, or exchangeable for, Capital Stock or partnership,
participation or membership interests).

 

“Equity Offering”
means (a) an underwritten public offering pursuant to a registration
statement filed with the Commission in accordance with the Securities Act of
1933, as amended, of (1) Equity Interests (other than Disqualified Capital
Stock) of an Issuer or (2) Equity Interests (other than Disqualified
Capital Stock) of Parent, or (b) an unregistered offering for cash of (1) Equity
Interests (other than Disqualified Capital Stock) of an Issuer or (2) Equity
Interests (other than Disqualified Capital Stock) of Parent, in the case of
each of (a)(2) and (b)(2), to the extent that the cash proceeds therefrom
in an amount equal to 100% of the aggregate principal amount of the Notes to be
redeemed therewith, and any applicable premium, are used concurrently therewith
as a Capital Contribution to an Issuer.

 

“Euroclear”
means Euroclear Bank S.A./N.V., or its successor, as operator of the Euroclear
system.

 

“Event of Loss”
means, with respect to any material property or asset, any (1) loss,
destruction or damage of such property or asset or (2) any condemnation,
seizure or taking, by exercise of the power of eminent domain or otherwise, of
such property or asset, or confiscation or requisition of the use of such
property or asset.

 

“Exchange Act”
means the Securities Exchange Act of 1934, as amended.

 

“Excluded Person”
means each of:  (a) Aurora
Industrial Holdings LLC, Aurora Equity Partners II L.P., Aurora Equity Partners
III L.P., Aurora Overseas Equity Partners II, L.P. 

 

9

 

and Aurora Overseas Equity
Partners III, L.P. (the “Aurora Limited Partnerships”); (b) Aurora Capital
Partners II L.P., Aurora Capital Partners III L.P., Aurora Overseas Capital
Partners II, L.P. and Aurora Overseas Capital Partners III, L.P. (the “Aurora
General Partners”); (c) Aurora Advisors II LLC, Aurora Advisors III LLC,
Aurora Overseas Advisors II, LDC and Aurora Overseas Advisors DI, LDC (the “Ultimate
Aurora General Partners”); (d) any limited partner of the Aurora Limited
Partnerships or any limited partner of the Aurora General Partners, provided that such limited partner gives a proxy to, or
otherwise agrees that it will vote in a manner consistent with, any of the
Aurora Limited Partnerships or the Aurora General Partners; (e) any
managing director or employee of Aurora Management Partners LLC, provided that such managing director or employee gives a
proxy to, or otherwise agrees that he or she will vote in a manner consistent
with, the Aurora Limited Partnerships or the Aurora General Partners; (f) any
member of the Advisory Board of Aurora Management Partners LLC, provided that such member gives a proxy to, or otherwise
agrees that he or she will vote in a manner consistent with, the Aurora Limited
Partnerships or the Aurora General Partners; (g) any Affiliate of Aurora
Management Partners LLC, provided that
such Affiliate gives a proxy to, or otherwise agrees that it will vote in a
manner consistent with, the Aurora Limited Partnerships or the Aurora General
Partners; (h) any investment fund or other entity controlled by or under
common control with, any one or more of the Ultimate Aurora General Partners or
Aurora Management Partners LLC or the principals that control any one or more
of the Ultimate Aurora General Partners or Aurora Management, Partners LLC; (i) the
Ares Corporate Opportunities Fund, L.P. (the “Ares Limited Partnership”); (j) ACOF
Management, L.P.; (k) ACOF Operating Manager, L.P.; (l) Ares
Management, Inc.; (m) Ares Management LLC; (n) any limited
partner of any of the Persons described in clauses (i) through (m), provided that such limited partner gives a proxy to, or
otherwise agrees that it will vote in a manner consistent with, the Ares
Limited Partnership; or (o) managing directors, members, partners or
employees of any of those Persons described in clauses (i) through (m), provided that each of such managing directors, members,
partners and employees gives a proxy to, or otherwise agrees that it will vote
in a manner consistent with, the Ares Limited Partnership, provided,
that each Person set forth in clauses (d) through (h), (n) and (o) shall
only constitute an Excluded Person so long as the entity to which it is
required to give a proxy to or otherwise vote consistently with continues to
own Equity Interests in Parent or the Company, as the case may be.

 

“Exempted Affiliate
Transaction” means:  (a) transactions
between an Issuer or any of its Subsidiaries and any employee, officer or
director of Parent, any Issuer or any of the Subsidiaries of any Issuer that
are approved by the disinterested members of the Board of Directors or, if no
members of the Board of Directors are disinterested, by the full Board of
Directors; (b) reasonable and customary directors’ fees, indemnification
and similar arrangements for officers, directors or employees, officer or
employee salaries, bonuses or employment agreements, compensation or employee
benefit arrangements and incentive arrangements, in the case of any of the
foregoing, with any officer, director or employee of any Issuer, any parent
company of an Issuer, or any Subsidiary and payments under any indemnification
arrangements permitted by applicable law; (c) transactions between or
among an Issuer and/or its Consolidated Subsidiaries; (d) transactions
with a Person (other than an Unrestricted Subsidiary) that is an Affiliate of
an Issuer or any Subsidiary solely because an Issuer or any Subsidiary owns an
Equity Interest in, or controls, such Person; (e) issuances and sales of
Equity Interests (other than Disqualified Capital Stock) to Affiliates of an
Issuer; (f) Restricted Payments that are permitted under the terms of Section 4.9;
(g) so long as no Event of Default pursuant to clause (1) or (2) of
Section 6.1 or any other Event of Default pursuant to which the
obligations under the Notes have been accelerated shall have occurred and be
continuing, (i) the payment of any fees, expenses or other amounts pursuant
to the Management Services Agreement as in effect on the Issue Date, and (ii) the
payment of any other amounts pursuant to the Management Services Agreement, as 

 

10

 

amended from time to time in
accordance with Section 4.12, and that are otherwise approved by a
majority of the disinterested members of the Board of Directors or, if no
members of the Board of Directors are disinterested, by the full Board of
Directors; and (h) transactions pursuant to the Tax Sharing Agreement as
in effect on the Issue Date.

 

“Existing Indebtedness”
means Indebtedness of the Company or the Subsidiaries (other than Indebtedness
under the Credit Facility) in existence on the Issue Date, reduced to the
extent such amounts are repaid, refinanced or retired.

 

“fair market value”
means the price that would be paid in an arm’s-length transaction between an
informed and willing seller under no compulsion to sell and an informed and
willing buyer under no compulsion to buy, as determined in good faith by the
Issuers.

 

“Finance Company”
means Douglas Dynamics Finance Company, a Delaware corporation.

 

“Foreign Subsidiary”
means any Subsidiary of an Issuer that (i) is not organized under the laws
of the United States, any state thereof or the District of Columbia and (ii) is
classified as a “corporation” for United States federal income tax purposes.

 

“GAAP” means
United States generally accepted accounting principles set forth in the
opinions and pronouncements of the Accounting Principles Board of the American
Institute of Certified Public Accountants and statements and pronouncements of
the Financial Accounting Standards Board or in such other statements by such
other entity as have been approved by a significant segment of the accounting
profession in the United States as in effect from time to time.

 

“Global Notes”
means one or more Notes in the form of Exhibit A hereto, which includes
the information referred to in footnotes 2, 3, 4 and 9 to the form of Note
attached hereto as Exhibit A, issued under this Indenture, that is
deposited with or on behalf of and registered in the name of the Depositary or
its nominee.

 

“Global Note Legend”
means the legend set forth in Section 2.6(f)(ii) hereof, which is
required to be placed on all Global Notes issued under this Indenture.

 

“guarantee”
means a guarantee (other than by endorsement of negotiable instruments for
collection in the ordinary course of business), direct or indirect, in any
manner (including, without limitation, letters of credit and reimbursement
agreements in respect thereof), of all or any part of any Indebtedness.

 

“Guarantee”
means the guarantee by the Guarantors of all or any part of the Notes, in
accordance with Article X hereof, including the Parent Guarantee.

 

“Guarantors”
means Parent, for so long as Parent is required to guarantee the Notes pursuant
to the terms of this Indenture, together with the Subsidiary Guarantors.

 

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

 

“Indebtedness”
of any Person means, without duplication,

 

11

 

(a)           all liabilities and obligations, contingent or otherwise,
of such Person, to the extent such liabilities and obligations would appear as
a liability upon the consolidated balance sheet of such Person in accordance
with GAAP, (1) in respect of borrowed money (whether or not the recourse
of the lender is to the whole of the assets of such Person or only to a portion
thereof), (2) evidenced by bonds, notes, debentures or similar
instruments, or (3) representing the balance deferred and unpaid of the
purchase price of any property or services, except those incurred in the
ordinary course of its business that would constitute ordinarily a trade
payable to trade creditors;

 

(b)           all liabilities and obligations, contingent or otherwise,
of such Person (1) evidenced by bankers’ acceptances or similar
instruments issued or accepted by banks, (2) relating to any Capitalized
Lease Obligation, or (3) evidenced by a letter of credit or a
reimbursement obligation of such Person with respect to any letter of credit;

 

(c)           all net obligations of such Person under Interest Swap and
Hedging Obligations;

 

(d)           all liabilities and obligations of others of the kind
described in the preceding clause (a), (b) or (c) that such Person
has guaranteed or provided credit support or that is otherwise its legal
liability or which are secured by any assets or property of such Person;

 

(e)           any and all deferrals, renewals, extensions, refinancing
and refundings (whether direct or indirect) of, or amendments, modifications or
supplements to, any liability of the kind described in any of the preceding
clauses (a), (b), (c) or (d), or this clause (e), whether or not between
or among the same parties;

 

(f)            all Disqualified Capital Stock of such Person (measured
at the greater of its voluntary or involuntary maximum fixed repurchase price
plus accrued and unpaid dividends); and

 

(g)           all Attributable Indebtedness.

 

For purposes hereof, the “maximum
fixed repurchase price” of any Disqualified Capital Stock which does not have a
fixed repurchase price shall be calculated in accordance with the terms of such
Disqualified Capital Stock as if such Disqualified Capital Stock were purchased
on any date on which Indebtedness shall be required to be determined pursuant
to this Indenture, and if such price is based upon, or measured by, the fair
market value of such Disqualified Capital Stock, such fair market value to be
determined in good faith by the Board of Directors of the issuer of such
Disqualified Capital Stock.

 

The amount of any
Indebtedness outstanding as of any date shall be (1) the accreted value
thereof, in the case of any Indebtedness issued with original issue discount,
but the accretion of original issue discount in accordance with the original
terms of Indebtedness issued with an original issue discount shall not be
deemed to be an incurrence; and (2) in the case of Indebtedness of others
secured by a Lien on any asset of the specified Person, the lesser of (A) the
fair market value of such asset on the date on which Indebtedness is required
to be determined pursuant to this Indenture and (B) the amount of the
Indebtedness so secured; and (3) in the case of the guarantee by the
specified Person of any Indebtedness of any other Person, the maximum liability
to which the specified Person may be subject upon the occurrence of the
contingency giving rise to the obligation; and (4) the principal amount
thereof, in the case of any other Indebtedness.

 

12

 

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

 

“Indirect Participant”
means an entity that, with respect to the Depository Trust Company, clears
through or maintains a direct or indirect, custodial relationship with a
Participant.

 

“Initial Purchasers”
mean the initial purchasers of the Notes under the Purchase Agreement.

 

“Interest Payment Date”
means the stated due date of an installment of interest on the Notes.

 

“Interest Swap and Hedging
Obligation” means any obligation of any Person pursuant to any
interest rate swap agreement, interest rate cap agreement, interest rate collar
agreement, interest rate exchange agreement, currency exchange agreement or any
other agreement or arrangement designed to protect against fluctuations in
interest rates or currency values, including, without limitation, any
arrangement whereby, directly or indirectly, such Person is entitled to receive
from time to time periodic payments calculated by applying either a fixed or
floating rate of interest on a stated notional amount in exchange for periodic
payments made by such Person calculated by applying a fixed or floating rate of
interest on the same notional amount.

 

“Investment” by
any Person in any other Person means (without duplication):

 

(a)           the acquisition (whether by purchase, merger,
consolidation or otherwise) by such Person (whether for cash, property,
services, securities or otherwise) of Equity Interests, capital stock, bonds,
notes, debentures, partnership or other ownership interests or other
securities, including any options or warrants, of such other Person;

 

(b)           the making by such Person of any deposit with, or advance,
loan or other extension of credit to, such other Person (including the purchase
of property from another Person subject to an understanding or agreement,
contingent or otherwise, to resell such property to such other Person) or any
commitment to make any such advance, loan or extension (but excluding accounts
receivable, trade credit and endorsements for collection or deposits arising in
the ordinary course of business);

 

(c)           other than guarantees of Indebtedness of the Company or
any Subsidiary Guarantor to the extent permitted under Section 4.7 hereof,
the entering into by such Person of any guarantee of, or other credit support
or contingent obligation with respect to, Indebtedness or other liability of
such other Person;

 

(d)           the making of any capital contribution by such Person to
such other Person; and

 

(e)           the designation by the Board of Directors of any Person to
be an Unrestricted Subsidiary.

 

The Issuers shall be deemed
to make an Investment in an amount equal to the fair market value of the net
assets of any subsidiary (or, if none of the Issuers nor any of the
Subsidiaries has theretofore made an Investment in such subsidiary, in an
amount equal to the Investments being 

 

13

 

made), at the time that such
subsidiary is designated an Unrestricted Subsidiary, and any property
transferred to an Unrestricted Subsidiary from an Issuer or a Subsidiary shall
be deemed an Investment valued at its fair market value at the time of such
transfer.  The Issuers or any of the
Subsidiaries shall be deemed to have made an Investment in a Person that is or
was a Wholly Owned Subsidiary if, upon the issuance, sale or other disposition
of any portion of an Issuer’s or such Subsidiary’s ownership in the Equity
Interests of such Person, such Person ceases to be a Wholly Owned Subsidiary in
an amount equal to the fair market value of the Equity Interests of and all
other Investments in such Wholly Owned Subsidiary not sold or disposed of
(which fair market value amount shall be determined in the good faith judgment
of the Board of Directors for amounts in excess of $1.0 million).  The fair market value of each Investment
shall be measured at the time made or returned, as applicable.

 

“Investment Company Act”
means the Investment Company Act of 1940, as amended.

 

“Issue Date”
means the date of first issuance of the Notes under this Indenture.

 

“Issuers” means
each of the parties named as such in this Indenture, and their respective
successors in accordance with the terms of this Indenture.

 

“Legal Holiday”
means a Saturday, a Sunday or a day on which banking institutions in The City
of New York, or the city in which the principal corporate trust office of the
Trustee is located, or at a place of payment, are authorized by law, regulation
or executive order to remain closed.  If
a payment date is a Legal Holiday, payment may be made at that place on the
next succeeding day that is not a Legal Holiday, and no interest shall accrue
for the intervening period.

 

“Lien” means any
mortgage, charge, pledge, lien (statutory or otherwise), privilege, security
interest, hypothecation or other encumbrance upon or with respect to any
property of any kind, real or personal, movable or immovable, now owned or
hereafter acquired.

 

“Management Services
Agreement” means that certain Amended and Restated Joint Management
Services Agreement, dated as of April 12, 2004, by and among Parent, the
Company, Aurora Management Partners LLC and ACOF Management, L.P.

 

“Moody’s” means
Moody’s Investors Service, Inc. and its successors.

 

“Net Cash Proceeds”
means the aggregate amount of cash or Cash Equivalents received (1) by an
Issuer in the case of a sale, or Capital Contribution in respect, of Qualified
Capital Stock and (2) by an Issuer or a Subsidiary in respect of an Event
of Loss or an Asset Sale plus, in the case of an issuance of Qualified Capital
Stock upon any exercise, exchange or conversion of securities (including
options, warrants, rights and convertible or exchangeable debt) of an Issuer
that were issued for cash on or after the Issue Date, the amount of cash
originally received by such Issuer upon the issuance of such securities
(including options, warrants, rights and convertible or exchangeable debt)
less, in each case, the sum of all payments, fees, commissions and (in the case
of Asset Sales, reasonable), expenses (including, without limitation, the fees
and expenses of legal counsel and investment banking fees and expenses)
incurred in connection with such Asset Sale, Event of Loss, or sale of
Qualified Capital Stock, and, in the case of an Asset Sale or Event of Loss
only, less (1) the amount (estimated reasonably and in good faith by the
Company) of income, franchise, sales, other applicable taxes, and Tax Payments
required to be paid (or, in the case of Tax Payments, permitted to be paid) by
an Issuer 

 

14

 

or any of the Subsidiaries
in connection with such Asset Sale or Event of Loss in the taxable year that
such sale is consummated (or such Event of Loss occurs) or in the immediately
succeeding taxable year, the computation of which shall take into account the
reduction in tax liability resulting from any available operating loss, net
operating loss carryforward, tax credit, tax credit carryforwards, and similar
tax attributes; (2) all distributions and other payments required to be
made as a result of such Asset Sale or Event of Loss to minority interest
holders in Subsidiaries or joint ventures having a beneficial interest in the
assets that are the subject of the Asset Sale or Event of Loss; and (3) any
reserves required to be established by the seller in an Asset Sale in respect
of such Asset Sale in accordance with GAAP against liabilities (other than any
liabilities in respect of taxes) reasonably anticipated and directly
attributable to the Asset Sale.

 

“Non-U.S. Person”
means any Person other than a U.S. Person.

 

“Notes Custodian”
means the Trustee, as custodian with respect to the Notes in global form, or
any successor entity thereto.

 

“Offering” means
the offering of the Notes by the Issuers.

 

“Offering Circular”
means the final Confidential Offering Circular of the Issuers, dated December 10,
2004, related to the offer and sale of the Notes.

 

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

 

“Officers’ Certificate”
means, with respect to the Issuers, the officers’ certificate, signed by one or
more Officers, to be delivered upon the occurrence of certain events as set
forth in this Indenture, that meets the requirements of Sections 11.4 and 11.5
hereof.

 

“Opinion of Counsel”
means an opinion from legal counsel who is reasonably acceptable to the
Trustee, that meets the requirements of Sections 11.4 and 11.5 hereof.  The counsel may be an employee of or counsel
to the Issuers or any Subsidiary of the Issuers.

 

“Parent” means
Douglas Dynamics Holdings, Inc., a Delaware corporation, or its successor.

 

“Parent Consolidated Tax
Liability” means, in the case of any particular taxable period for
which a Tax Payment to Parent may be paid, an amount equal to the actual
consolidated, combined, or unitary tax liability of Parent, to which such Tax
Payment relates, that is payable to the relevant tax authority.

 

“Parent Guarantee”
means the guarantee of the Notes by Parent in accordance with Article X
hereof.

 

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

 

“Permitted Indebtedness”
means that:

 

15

 

(a)           the Issuers and the Subsidiary Guarantors may incur
Indebtedness evidenced by the Notes and the Guarantees issued pursuant to the
Indenture up to the amounts being issued on the original Issue Date less any
amounts repaid or retired;

 

(b)           the Issuers and the Subsidiary Guarantors, as applicable,
may incur Refinancing Indebtedness with respect to any Existing Indebtedness or
any Indebtedness (including Disqualified Capital Stock), described in clause (a) of
this definition or incurred pursuant to the Debt Incurrence Ratio test of Section 4.7,
or which was refinanced pursuant to this clause (b);

 

(c)           the Issuers and the Subsidiaries may incur Indebtedness
solely in respect of bankers acceptances, letters of credit, surety bonds,
performance bonds and similar bonds (to the extent that such incurrence does
not result in the incurrence of any obligation to repay any obligation relating
to borrowed money or other Indebtedness), all in the ordinary course of
business, in amounts and for the purposes customary in the Company’s industry;

 

(d)           an Issuer may incur Indebtedness owed to (borrowed from)
any Subsidiary Guarantor, and any Subsidiary Guarantor may incur Indebtedness
owed to (borrowed from) any other Subsidiary Guarantor or an Issuer; provided, that in the case of Indebtedness of an Issuer,
such obligations shall be unsecured and contractually subordinated in all
respects to such Issuer’s obligations pursuant to the Notes and any event that
causes such Subsidiary Guarantor no longer to be a Subsidiary Guarantor
(including by designation to be an Unrestricted Subsidiary) shall be deemed to
be a new incurrence by such Issuer of such Indebtedness and any guarantor
thereof subject to Section 4.7;

 

(e)           any Subsidiary Guarantor may guaranty, any Indebtedness of
an Issuer or another Subsidiary Guarantor that was permitted to be incurred
pursuant to the Indenture;

 

(f)            the Issuers and the Subsidiary Guarantors may incur
Interest Swap and Hedging Obligations that are incurred for the purpose of
fixing or hedging interest rate or currency risk with respect to any fixed or
floating rate Indebtedness that is permitted by the Indenture to be outstanding
or any receivable or liability the payment of which is determined by reference
to a foreign currency; provided, that
the notional amount of any such Interest Swap and Hedging Obligation does not
exceed the principal amount of Indebtedness to which such Interest Swap and
Hedging Obligation relates;

 

(g)           Indebtedness arising from the honoring by a bank or other
financial institution of a check, draft or similar instrument inadvertently
drawn against insufficient funds in the ordinary course of business so long as
such Indebtedness is extinguished within five Business Days;

 

(h)           Indebtedness arising from agreements of an Issuer or any
Subsidiary providing for indemnification, adjustment of purchase price or
similar obligations, or contingent earn-out payments in each case, which
agreements for indemnification, adjustment of purchase price or similar
obligations, or contingent earn-out payments were entered into in connection
with the acquisition or disposition of any business or assets, other than
guarantees of Indebtedness incurred by any Person acquiring all or any portion of
such business or assets for the purpose of financing such acquisition; and

 

(i)            a Foreign Subsidiary may incur Indebtedness owed to
(borrowed from) an Issuer or a Subsidiary Guarantor in an aggregate amount
incurred and outstanding at any time 

 

16

 

pursuant to this clause (i) not to
exceed the amount of any Investment made in such Foreign Subsidiary in
accordance with clause (m) of the definition of Permitted Investments.

 

“Permitted Investment”
means:

 

(a)           any Investment in any of the Notes;

 

(b)           any Investment in cash and Cash Equivalents;

 

(c)           intercompany notes to the extent permitted under clause (d) of
the definition of “Permitted Indebtedness;”

 

(d)           any Investment by an Issuer or any Subsidiary Guarantor in
a Person in a Related Business if as a result of such Investment such Person
immediately becomes a Subsidiary Guarantor or such Person is immediately merged
with or into an Issuer or a Subsidiary Guarantor;

 

(e)           any Investment in any Person in exchange for (i) Qualified
Capital Stock of an Issuer, or (ii) the Net Cash Proceeds of any
substantially concurrent sale of the Qualified Capital Stock of an Issuer, or (iii) the
Net Cash Proceeds to an Issuer resulting from a Capital Contribution to such
Issuer of the cash proceeds of any substantially concurrent sale of Qualified
Capital Stock of Parent;

 

(f)            any Investment made as a result of the receipt of
non-cash consideration from an Asset Sale that was made pursuant to Section 4.13;

 

(g)           Investments in connection with Interest Swap and Hedging
Obligations;

 

(h)           any Investment in existence on the Issue Date;

 

(i)            any Investment by an Issuer or a Subsidiary in an Issuer
or any Subsidiary Guarantor;

 

(j)            any Investment received in compromise of obligations of
trade creditors or customers that were incurred in the ordinary course of
business, including pursuant to any plan of reorganization or similar
arrangement upon the bankruptcy or insolvency of any trade creditor or customer
and any Investments received in satisfaction of judgments in connection
therewith;

 

(k)           workers’ compensation, utility, lease and similar deposits
and prepaid expenses, in each case in the ordinary course of business;

 

(l)            loans or advances to employees of an Issuer or any
Subsidiary in the ordinary course of business in aggregate amount not to exceed
$1.0 million at any one time outstanding; and

 

(m)          other Investments in any Person or Persons, provided, that after giving pro forma
effect to each such Investment, the aggregate amount of all such Investments
made on and after the Issue Date pursuant to this clause (m) that are
outstanding (after giving effect to any such Investments that are returned to
an Issuer or the Subsidiary Guarantor that made such prior Investment, without
restriction, in cash on or prior to the date of any such calculation, but only
up to the amount of the Investment made under this clause (m) in such
Person), at any time does not 

 

17

 

in the aggregate exceed $5.0 million
(measured by the value attributed to the Investment at the time made or
returned, as applicable).

 

“Permitted Lien”
means:

 

(a)           Liens existing on the Issue Date;

 

(b)           Liens imposed by governmental authorities for taxes,
assessments or other charges not yet subject to penalty or which are being
contested in good faith and by appropriate proceedings, if adequate reserves
with respect thereto are maintained on the books of the Company in accordance
with GAAP;

 

(c)           statutory liens of carriers, warehousemen, mechanics,
material men, landlords, repairmen or other like Liens arising by operation of
law in the ordinary course of business provided that (1) the
underlying obligations are not overdue for a period of more than 30 days, or (2) such
Liens are being contested in good faith and by appropriate proceedings and
adequate reserves with respect thereto are maintained on the books of the
Company in accordance with GAAP;

 

(d)           Liens securing the performance of bids, trade contracts
(other than borrowed money), leases, statutory obligations, surety and appeal
bonds, performance bonds and other obligations of a like nature incurred in the
ordinary course of business;

 

(e)           easements, rights-of-way, zoning, similar restrictions and
other similar encumbrances or title defects which, singly or in the aggregate,
do not in any case materially detract from the value of the property, subject
thereto (as such property is used by the Issuers or any of the Subsidiaries) or
materially interfere with the ordinary conduct of the business of the Issuers
or any of the Subsidiaries;

 

(f)            Liens arising by operation of law in connection with
judgments, only to the extent, for an amount and for a period not resulting in
an Event of Default with respect thereto;

 

(g)           pledges or deposits made in the ordinary course of
business in connection with workers’ compensation, unemployment insurance and
other types of social security legislation;

 

(h)           Liens securing the Notes;

 

(i)            Liens securing Indebtedness of a Person existing at the
time such Person becomes a Subsidiary or is merged with or into an Issuer or a
Subsidiary or Liens securing Indebtedness incurred in connection with an
Acquisition; Liens on assets of such Person at the time such Person is acquired
or merged with or into an Issuer or any Subsidiary; and Liens on assets
acquired by an Issuer or a Subsidiary; provided, in
each case, that such Liens were in existence prior to the date of such
acquisition, merger or consolidation, were not incurred in anticipation
thereof, and do not extend to any other assets;

 

(j)            Liens arising from Purchase Money Indebtedness permitted
to be incurred pursuant to Section 4.7(b)(1), provided
such Liens relate solely to the property which is subject to such Purchase
Money Indebtedness;

 

18

 

(k)           leases, subleases or non-exclusive licenses granted to
other Persons in the ordinary course of business not materially interfering
with the conduct of the business of the Issuers or any of the Subsidiaries;

 

(l)            Liens arising from precautionary Uniform Commercial Code
financing statement filings regarding operating leases entered into by the
Issuers or any of the Subsidiaries in the ordinary course of business;

 

(m)          Liens securing Refinancing Indebtedness incurred to refinance
any Indebtedness that was previously so secured in a manner no more adverse to
the Holders of the Notes than the terms of the Liens securing such refinanced
Indebtedness, and provided that the Indebtedness
secured is not increased and the Lien is not extended to any additional assets
or property that would not have been security for the Indebtedness refinanced;

 

(n)           Liens securing Indebtedness incurred under the Credit
Agreement in accordance with the terms of Section 4.7(b)(3);

 

(o)           Liens securing Indebtedness incurred in accordance with
the terms of Section 4.7, provided that,
at the time of such incurrence of such Indebtedness, the Consolidated Secured
Debt Ratio of the Company for the Reference Period immediately preceding the
date of such incurrence of such Indebtedness, after giving effect on a pro forma basis to such incurrence of such Indebtedness,
would be no greater than 2.5 to 1.0;

 

(p)           bankers liens and rights of set-off with respect to
customary depositary arrangements entered into in the ordinary course of
business of the Issuers and the Subsidiaries;

 

(q)           Liens to secure Attributable Indebtedness incurred
pursuant to Section 4.7(b)(4), provided, that
any such Lien shall not extend to or cover any assets of an Issuer or any
Subsidiary other than the assets which are the subject of the sale and
leaseback transaction in which the Attributable Indebtedness is incurred;

 

(r)            Liens in favor of any Issuer or any Subsidiary Guarantor;

 

(s)           Liens securing reimbursement obligations with respect to
letters of credit which encumber documents and other property relating to such
letters of credit and the products and proceeds thereof;

 

(t)            Liens in favor of customs and revenue authorities arising
as a matter of law to secure payment of customs duties in connection with the
importation of goods; and

 

(u)           Liens incurred by an Issuer or any Subsidiary with respect
to obligations that do not exceed $1.0 million at any one time outstanding.

 

“Permitted Payments to
Parent” means without duplication:

 

(a)           payments to Parent in an amount sufficient to permit
Parent to pay reasonable and necessary accounting, legal, general overhead and
administrative expenses of Parent but only to the extent such expenses are
directly attributable to the ownership or operation of the Company and its
Consolidated Subsidiaries,

 

19

 

(b)           payments to Parent pursuant to the Tax Sharing Agreement
as in effect on the Issue Date to enable Parent to pay foreign, federal, state
or local tax liabilities (“Tax Payment”), not to exceed the Parent Consolidated
Tax Liability, and

 

(c)           to the extent any payments made by the Company pursuant to
the Management Services Agreement, as amended from time to time in accordance
with Section 4.12, that are otherwise made in accordance with the terms of
the Indenture are deemed to be payments to or for the benefit of Parent, such
deemed amounts;

 

provided, however, that any Tax Payments or payments made pursuant to
clause (a) above shall either be used by Parent to pay such tax
liabilities in the case of Tax Payments or such fees and expenses in the case
of payments made pursuant to clause (a) above within 90 days of Parent’s
receipt of such payment or refunded to the payee.

 

“Person” or “person” means any corporation, individual, limited liability
company, joint stock company, joint venture, partnership, unincorporated
association, governmental regulatory entity, country, state or political
subdivision thereof, trust, municipality or other entity.

 

“Preferred Stock”
means any Equity Interest of any class or classes of a Person (however
designated) which is preferred as to payments of dividends, or as to
distributions upon any liquidation or dissolution, over Equity Interests of any
other class of such Person.

 

“Private Placement Legend”
means the legend set forth in Section 2.6(f)(i) hereof to be placed
on all Notes issued under this Indenture except where specifically stated
otherwise by the provisions of this Indenture.

 

“Pro Forma” or “pro forma” shall have the meaning set forth in Regulation
S-X of the Securities Act, unless otherwise specifically stated herein.

 

“Purchase Agreement”
means the Purchase Agreement, dated December 10, 2004, among the Issuers,
Parent and the Initial Purchasers, pursuant to which the Initial Purchasers
agreed to purchase, and the Issuers agreed to sell, the Notes issued on the
Issue Date.

 

“Purchase Money
Indebtedness” of any Person means any Indebtedness of such Person to
any seller or other Person incurred solely to finance the acquisition
(including in the case of a Capitalized Lease Obligation, the lease),
construction, installation or improvement of any real or personal tangible
property which is used or useful in a Related Business and which is incurred
within 180 days following such acquisition, construction, installation or
improvement and is secured only by the assets so financed.

 

“QIB” means a “qualified
institutional buyer” as defined in Rule 144A.

 

“Qualified Capital Stock”
means any Equity Interest of an Issuer that is not Disqualified Capital Stock.

 

“Qualified Exchange”
means:

 

(1)           any legal defeasance, redemption, retirement, repurchase
or other acquisition of Equity Interests, or  
Indebtedness of  an Issuer   issued on or after  the Issue Date with the Net Cash Proceeds
received by an Issuer  from the

 

20

 

substantially concurrent sale of its
Qualified Capital Stock (other than to a Subsidiary),

 

(2)           any issuance of Qualified Capital Stock of an Issuer in
exchange for any Equity Interests or Indebtedness of an Issuer issued on or
after the Issue Date, or

 

(3)           any issuance of Subordinated Indebtedness that is
Refinancing Indebtedness in exchange for Indebtedness (other than Disqualified
Capital Stock) of an Issuer issued on or after the Issue Date.

 

“Record Date”
means a Record Date specified in the Notes, whether or not such date is a
Business Day.

 

“Recourse Indebtedness”
means Indebtedness (a) as to which either an Issuer or any of the
Subsidiaries (1) provides credit support of any kind (including any
undertaking, agreement or instrument that would constitute Indebtedness), (2) is
directly or indirectly liable (as a guarantor or otherwise), or (3) constitutes
the lender, and (b) no default with respect to which (including any rights
that the holders thereof may have to take enforcement action against an
Unrestricted Subsidiary) would permit (upon notice, lapse of time or both) any
holder of any other Indebtedness of an Issuer or a Subsidiary to declare a
default on such other Indebtedness or cause the payment thereof to be
accelerated or payable prior to its stated maturity.

 

“Reference Period”
with regard to any Person means the four full fiscal quarters ended immediately
preceding any date upon which any determination is to be made pursuant to the
terms of the Notes or this Indenture.

 

“Refinancing Indebtedness”
means Indebtedness (including Disqualified Capital Stock) (a) issued in
exchange for, or the proceeds from the issuance and sale of which are used
substantially concurrently to repay, redeem, defease, refund, refinance,
discharge or otherwise retire for value, in whole or in part, or (b) constituting
an amendment, modification or supplement to, or a deferral or renewal of ((a) and
(b) above are, collectively, a “Refinancing”),
any Indebtedness (including Disqualified Capital Stock) in a principal amount
or, in the case of Disqualified Capital Stock, liquidation preference, not to
exceed (after deduction of reasonable fees and expenses incurred in connection
with the Refinancing plus the amount of any premium paid in connection with
such Refinancing) the lesser of (1) the principal amount or, in the case
of Disqualified Capital Stock, liquidation preference, of the Indebtedness
(including Disqualified Capital Stock) so Refinanced and (2) if such
Indebtedness being Refinanced was issued with an original issue discount, the
accreted value thereof (as determined in accordance with GAAP) at the time of
such Refinancing; provided, that (A) such
Refinancing Indebtedness shall only be used to refinance outstanding
Indebtedness (including Disqualified Capital Stock) of such Person issuing such
Refinancing Indebtedness, (B) such Refinancing Indebtedness shall (x) not
have an Average Life shorter than the Indebtedness (including Disqualified
Capital Stock) to be so refinanced at the time of such Refinancing and (y) in
all respects, be no less contractually subordinated or junior, if applicable,
to the rights of Holders of the Notes than was the Indebtedness (including
Disqualified Capital Stock) to be refinanced, (C) such Refinancing
Indebtedness shall have a final stated maturity or Redemption Date, as
applicable, no earlier than the final stated maturity or Redemption Date, as
applicable, of the Indebtedness (including Disqualified Capital Stock) to be so
refinanced or, if sooner, 91 days after the Stated Maturity of the Notes, and (D) such
Refinancing Indebtedness shall be secured (if secured) in a manner no more
adverse to the Holders of the Notes than the terms of the Liens (if any)
securing such 

 

21

 

refinanced Indebtedness,
including, without limitation, the amount of Indebtedness secured shall not be
increased.

 

“Refinancing Transactions”
means the offering of the Notes on the Issue Date, the closing of the Credit
Agreement on the Issue Date and the use of proceeds from both to repay
outstanding indebtedness, pay a dividend to Parent and pay related premiums,
fees and expenses, in each case as described in the Offering Circular.

 

“Regulation S”
means Regulation S promulgated under the Securities Act, as it may be amended
from time to time, and any successor provision thereto.

 

“Regulation S Global Note”
means a Regulation S Temporary Global Note or a Regulation S Permanent Global
Note, as the case may be.

 

“Regulation S Global Note
Legend” means the legend set forth in Section 2.6(f)(iv) hereof,
which is required to be placed on all Regulation S Global Notes.

 

“Regulation S Permanent
Global Note” means one or more permanent Global Notes bearing the
Private Placement Legend and the Regulation S Global Note Legend, that shall be
issued in an aggregate amount of denominations equal in total to the
outstanding principal amount of the Regulation S Temporary Global Note upon
expiration of the Distribution Compliance Period.

 

“Regulation S Temporary
Global Note” means one or more temporary Global Notes bearing the
Private Placement Legend, the Regulation S Temporary Global Note Legend and the
Regulation S Global Note Legend, issued in an aggregate amount of denominations
equal in total to the outstanding principal amount of the Notes initially sold
in reliance on Rule 903 of Regulation S.

 

“Regulation S Temporary
Global Note Legend” means the legend set forth in Section 2.6(f)(iii) hereof,
which is required to be placed on all Regulation S Temporary Global Notes
issued under this Indenture.

 

“Related Business”
means the business conducted (or proposed to be conducted) by the Company and
its Subsidiaries as of the Issue Date and any and all businesses incidental or
reasonably related thereto or which are a reasonable extension thereof as
determined in the good faith judgment of the Board of Directors.

 

“Responsible Officer”
shall mean, when used with respect to the Trustee, any officer within the
corporate trust department of the Trustee, including any vice president,
assistant vice president, assistant secretary, assistant treasurer, trust
officer or any other officer of the Trustee who customarily performs functions
similar to those performed by the persons who at the time shall be such
officers, respectively, or to whom any corporate trust matter is referred
because of such person’s knowledge of and familiarity with the particular
subject and who shall have direct responsibility for the administration of this
Indenture.

 

“Restricted Definitive Note”
means one or more Definitive Notes bearing the Private Placement Legend, issued
under this Indenture.

 

“Restricted Global Note”
means one or more Global Notes bearing the Private Placement Legend, issued
under this Indenture.

 

22

 

“Restricted Investment”
means, in one or a series of related transactions, any Investment, other than
other Permitted Investments.

 

“Restricted Payment”
means, with respect to any Person:

 

(a)           the declaration or payment of any dividend or other
distribution in respect of Equity Interests of such Person, or any parent of
such Person;

 

(b)           any payment (except to the extent with Qualified Capital
Stock) by such Person on account of the purchase, redemption or other
acquisition or retirement for value of Equity Interests of such Person or any
parent of such Person;

 

(c)           other than with the proceeds from the substantially
concurrent sale of, or in exchange for, Refinancing Indebtedness, any purchase,
redemption, or other acquisition or retirement for value of, any payment in
respect of any amendment of the terms of or any defeasance of, any Subordinated
Indebtedness, directly or indirectly, by such Person or a parent or Subsidiary
of such Person prior to the scheduled maturity, any scheduled repayment of
principal, or scheduled sinking fund payment, as the case may be, of such
Indebtedness; and

 

(d)           any Restricted Investment by such Person;

 

provided, however, that the term “Restricted Payment” does not include
(1) any dividend, distribution or other payment on or with respect to
Equity Interests of an issuer to the extent payable solely in shares of
Qualified Capital Stock of such issuer, or (2) any dividend, distribution
or other payment to an Issuer or to any Subsidiary Guarantor, by an Issuer or
any of the Subsidiaries.

 

“Rule 144”
means Rule 144 promulgated under the Securities Act, as it may be amended
from time to time, and any successor provision thereto.

 

“Rule 144A”
means Rule 144A promulgated under the Securities Act, as it may be amended
from time to time, and any successor provision thereto.

 

“SEC” or “Commission” means the United States Securities and Exchange
Commission, or any successor agency.

 

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

 

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

 

“Significant Acquisition or
Disposition” means any acquisition or disposition by an Issuer or
any Subsidiary involving a significant amount of assets.  An acquisition or disposition shall be deemed
to involve a significant amount of assets if the equity of the Company and its
Subsidiaries in the net book value of such assets or the amount paid or
received for the assets upon such acquisition or disposition exceeded 20% of
the total assets of the Company and its Consolidated Subsidiaries or if it
involved a business (as described in Rule 11-01(d) of Regulation S-X
of the Securities Act) that is significant. 
Acquisitions or dispositions of individually insignificant businesses
will be deemed not to constitute a Significant Acquisition or Disposition
unless they are related businesses and are significant in the aggregate.

 

23

 

“Significant Subsidiary”
shall have the meaning provided under Regulation S-X of the Securities Act, as
in effect on the Issue Date.

 

“Special Record Date”
means, for payment of any Defaulted Interest, a date fixed by the Paying Agent
pursuant to Section 2.12 hereof.

 

“Stated Maturity”
when used with respect to any Note, means January 15, 2012.

 

“Subordinated Indebtedness”
means Indebtedness of an Issuer or a Subsidiary Guarantor that is subordinated
in right of payment by its terms or the terms of any document or instrument or
instrument relating thereto (“contractually”)
to the Notes or such Subsidiary’s Guarantee, as applicable, in any respect.

 

“Subsidiary”
with respect to any Person, means (1) a corporation a majority of whose
Equity Interests with voting power, under ordinary circumstances, to elect
directors is at the time, directly or indirectly, owned by such Person, by such
Person and one or more Subsidiaries of such Person or by one or more
Subsidiaries of such Person, and (2) any other Person (other than a
corporation) in which such Person, one or more Subsidiaries of such Person, or
such Person and one or more Subsidiaries of such Person, directly or
indirectly, at the date of determination thereof has a majority ownership
interest, or (3) a partnership in which such Person or a Subsidiary of
such Person is, at the time, a general partner and in which such Person,
directly or indirectly, at the date of determination thereof has a majority
ownership interest.  Unless the context
requires otherwise, Subsidiary means each direct and indirect Subsidiary of the
Company.  Notwithstanding the foregoing,
neither an Unrestricted Subsidiary nor any of its Subsidiaries shall be a
Subsidiary of an Issuer or of any Subsidiary.

 

“Subsidiary Guarantor”
means each of the Issuers’ Subsidiaries that at the time are guarantors of the
Notes in accordance with this Indenture.

 

“Tax Sharing Agreement”
means that certain Tax Sharing Agreement among Parent, the Company and the
Finance Company, dated as of December 10, 2004.

 

“TIA” means the
Trust Indenture Act of 1939 (15 U.S.C. §§ 77aaa-77bbbb) as in effect from
time to time.

 

“Transfer Restricted Notes”
means Global Notes and Definitive Notes that bear or are required to bear the
Private Placement Legend, issued under this Indenture.

 

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

 

“Unrestricted Definitive
Note” means one or more Definitive Notes that do not bear and are
not required to bear the Private Placement Legend, issued under this Indenture.

 

“Unrestricted Global Note”
means one or more permanent Global Notes representing a series of Notes that
does not bear and is not required to bear the Private Placement Legend, issued
under this Indenture.

 

“Unrestricted Subsidiary”
means any subsidiary of an Issuer that does not directly, indirectly or
beneficially own any Equity Interests of, or Subordinated Indebtedness of, 

 

24

 

or own or hold any Lien on
any property of, an Issuer or any other Subsidiary and that, at the time of
determination, shall be an Unrestricted Subsidiary (as designated by the Board
of Directors); provided, that such Subsidiary at
the time of such designation (a) has no Recourse Indebtedness; (b) is
not party to any agreement, contract, arrangement or understanding with an
Issuer or any Subsidiary unless the terms of any such agreement, contract,
arrangement or understanding are no less favorable to such Issuer or such
Subsidiary than those that might be obtained at the time from Persons who are
not Affiliates of such Issuer; (c) is a Person with respect to which none
of the Issuers or any of the Subsidiaries has any direct or indirect obligation
(x) to subscribe for additional Equity Interests or (y) to maintain
or preserve such Person’s financial condition or to cause such Person to
achieve any specified levels of operating results; and (d) has not
guaranteed or otherwise directly or indirectly provided credit support for any
Indebtedness of an Issuer or any of the Subsidiaries.  The Board of Directors may designate any
Unrestricted Subsidiary to be a Subsidiary, provided, that
such designation will be deemed to be an incurrence of Indebtedness by a
Subsidiary of any outstanding Indebtedness of such Unrestricted Subsidiary and
such designation will only be permitted if (1) such Indebtedness is
permitted to be incurred under Section 4.7, calculated on a pro forma basis as if such designation had occurred at the
beginning of the Reference Period and (2) no Default or Event of Default
is existing or would occur as a consequence of such designation.  Each such designation shall be evidenced by
filing with the Trustee a certified copy of the resolution giving effect to
such designation and an Officers’ Certificate certifying that such designation
complied with the foregoing conditions.

 

“U.S. Government
Obligations” means direct non-callable obligations of, or
noncallable obligations guaranteed by, the United States of America for the
payment of which obligation or guarantee the full faith and credit of the
United States of America is pledged.

 

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

 

“Voting Equity Interests”
means Equity Interests which at the time are entitled to vote in the election
of, as applicable, directors, members or partners generally and, in the case of
Parent, shall specifically include its Series B Special Voting Preferred
Stock, $.01 par value per share, and its Series C Special Voting Preferred
Stock, $.01 par value per share, in each case as in effect on the Issue Date.

 

“Wholly Owned Subsidiary”
means a Subsidiary all the Equity Interests of which (other than directors’
qualifying shares) are owned by an Issuer or one or more Wholly Owned
Subsidiaries of an Issuer or a combination thereof.

 

Section 1.2                                                              Other
Definitions

 

	
   

  	
  Term

  	
   

  	
  Defined
  in Section

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
  “Affiliate
  Transaction”

  	
   

  	
  4.12

  	
   

  
	
   

  	
  “Asset
  Sale”

  	
   

  	
  4.13

  	
   

  
	
   

  	
  “Asset
  Sale Offer”

  	
   

  	
  4.13

  	
   

  
	
   

  	
  “Asset
  Sale Offer Price”

  	
   

  	
  4.13

  	
   

  
	
   

  	
  “Authentication
  Order”

  	
   

  	
  2.2

  	
   

  
	
   

  	
  “Benefited
  Party”

  	
   

  	
  10.1

  	
   

  

 

25

 

	
   

  	
  “Change
  of Control Offer”

  	
   

  	
  4.14

  	
   

  
	
   

  	
  “Change
  of Control Offer Period”

  	
   

  	
  4.14

  	
   

  
	
   

  	
  “Change
  of Control Purchase Date”

  	
   

  	
  4.14

  	
   

  
	
   

  	
  “Change
  of Control Purchase Price”

  	
   

  	
  4.14

  	
   

  
	
   

  	
  “Covenant
  Defeasance”

  	
   

  	
  8.3

  	
   

  
	
   

  	
  “Debt
  Incurrence Ratio”

  	
   

  	
  4.7

  	
   

  
	
   

  	
  “Defaulted
  Interest”

  	
   

  	
  2.12

  	
   

  
	
   

  	
  “DTC”

  	
   

  	
  2.3

  	
   

  
	
   

  	
  “Event
  of Default”

  	
   

  	
  6.1

  	
   

  
	
   

  	
  “Excess
  Proceeds”

  	
   

  	
  4.13

  	
   

  
	
   

  	
  “Guarantee
  Obligations”

  	
   

  	
  10.1

  	
   

  
	
   

  	
  “incur”
  or “incurrence”

  	
   

  	
  4.7

  	
   

  
	
   

  	
  “Incurrence
  Date”

  	
   

  	
  4.7

  	
   

  
	
   

  	
  “Legal
  Defeasance”

  	
   

  	
  8.2

  	
   

  
	
   

  	
  “Paying
  Agent”

  	
   

  	
  2.3

  	
   

  
	
   

  	
  “Redemption
  Date”

  	
   

  	
  4.7

  	
   

  
	
   

  	
  “Registrar”

  	
   

  	
  2.3

  	
   

  

 

Section 1.3                                                              Incorporation
by Reference of Trust Indenture Act

 

Whenever this Indenture refers to a provision of the
TIA, such provision is incorporated by reference in and made a part of this
Indenture.

 

The following TIA terms used in this Indenture have
the following meanings:

 

“Commission”
means the Securities and Exchange Commission;

 

“obligor” on the
Notes means the Issuers, each Guarantor and any successor obligor upon the
Notes.

 

All other terms used in this Indenture that are
defined by the TIA, defined by TIA reference to another statute or defined by
SEC rule under the TIA have the meanings so assigned to them.

 

Section 1.4                                                              Rules of
Construction

 

Unless the context otherwise requires:

 

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

 

(2)           an accounting term not otherwise defined has the meaning
assigned to it in accordance with GAAP;

 

26

 

(3)           “or” is not exclusive;

 

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

 

(5)           provisions apply to successive events and transactions;

 

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

 

(7)           references to sections of or rules under the
Securities Act and the Exchange Act shall be deemed to include substitute,
replacement of successor sections or rules adopted by the SEC from time to
time.

 

ARTICLE II

 

THE NOTES

 

Section 2.1                                                              Form and
Dating

 

(a)           General.  The Notes
and the Trustee’s certificate of authentication shall be substantially in the
form of Exhibit A hereto.  The Notes
may have notations, legends or endorsements required by law, stock exchange rule or
usage.  Each Note shall be dated the date
of its authentication.  The Notes shall
be in denominations of $1,000 and integral multiples thereof.

 

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

 

(b)           Global Notes.  Notes
issued in global form shall be substantially in the form of Exhibit A
attached hereto (including the Global Note Legend thereon and the “Schedule of
Exchanges of Interests in the Global Note” attached thereto).  Notes issued in definitive form shall be
substantially in the form of Exhibit A attached hereto (but without the
Global Note Legend thereon and without the “Schedule of Exchanges of Interests
in the Global Note” attached thereto). 
Each Global Note shall represent such of the outstanding Notes as shall
be specified therein and each shall provide that it shall represent the
aggregate principal amount of outstanding Notes from time to time endorsed
thereon and that the aggregate principal amount of outstanding Notes
represented thereby may from time to time be reduced or increased, as
appropriate, to reflect exchanges and redemptions.  Any endorsement of a Global Note to reflect
the amount of any increase or decrease in the aggregate principal amount of
outstanding Notes represented thereby shall be made by the Trustee or the Notes
Custodian, at the direction of the Trustee, in accordance with instructions
given by the Holder thereof as required by Section 2.6 hereof.

 

(c)           Notes offered and sold in reliance on Regulation S will be
issued initially in the form of the Regulation S Temporary Global Note, which
will be deposited on behalf of the purchasers of the Notes represented thereby
with the Trustee, at its New York office, as custodian for the Depositary, and
registered in the name of the Depositary or the nominee of the Depositary for
the accounts of designated agents holding on behalf of Euroclear or
Clearstream, duly 

 

27

 

executed by the Issuers and authenticated by
the Trustee as hereinafter provided.  The
Distribution Compliance Period will be terminated upon the receipt by the
Trustee of any certificates identified by the Issuers or their counsel to be
required pursuant to Rule 903(b)(3)(ii)(B) under the Securities Act,
which may include certificates from Euroclear or Clearstream, as the case may
be, certifying that it has received certification of non-United States
beneficial ownership of 100% of the aggregate principal amount of the
Regulation S Temporary Global Note (except to the extent of any beneficial
owners thereof who acquired an interest therein during the Distribution
Compliance Period pursuant to another exemption from registration under the
Securities Act and who will take delivery of a beneficial ownership interest in
a 144A Global Note bearing a Private Placement Legend, all as contemplated by Section 2.06(b) hereof).

 

Following the termination of the Distribution
Compliance Period, beneficial interests in the Regulation S Temporary Global
Note will be exchanged for beneficial interests in the Regulation S Permanent
Global Note pursuant to the Applicable Procedures.  Simultaneously with the authentication of the
Regulation S Permanent Global Note, the Trustee will cancel the Regulation S
Temporary Global Note.  The aggregate
principal amount of the Regulation S Temporary Global Note and the Regulation S
Permanent Global Note may from time to time be increased or decreased by
adjustments made on the records of the Trustee and the Depositary or its
nominee, as the case may be, in connection with transfers of interest as
hereinafter provided.

 

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

 

Section 2.2                                                              Execution and
Authentication

 

Two Officers shall sign the Notes for the Issuers by
manual or facsimile signature.  In the
case of Definitive Notes, such signatures may be imprinted or otherwise
reproduced on such Notes.  If an Officer
whose signature is on a Note no longer holds that office at the time a Note is
authenticated, the Note shall nevertheless be valid.  A Note shall not be valid until authenticated
by the manual signature of the Trustee. 
The signature shall be conclusive evidence that the Note has been
authenticated under this Indenture.  The
Trustee shall, upon a written order of the Issuers signed by an Officer (an “Authentication
Order”), authenticate and deliver Notes for issuance up to the aggregate
principal amount stated in such Authentication Order; provided
that Notes authenticated for issuance on the Issue Date shall not exceed
$150,000,000 in aggregate principal amount. 
The Trustee may appoint an authenticating agent acceptable to the
Issuers to authenticate Notes.  An
authenticating agent may authenticate Notes whenever the Trustee may do
so.  Each reference in this Indenture to
authentication by the Trustee includes authentication by such agent.  An authenticating agent has the same rights
as an Agent to deal with Holders or an Affiliate of an Issuer.

 

Section 2.3                                                              Registrar,
Paying Agent and Depositary

 

The Issuers shall maintain an office or agency in
the Borough of Manhattan, The City of New York, where Notes may be presented
for registration of transfer or for exchange (“Registrar”) and an office or agency
where Notes may be presented for payment (“Paying Agent”).  The Registrar shall keep a register of the
Notes and of their transfer and exchange. 
The 

 

28

 

Issuers may appoint one or
more co-registrars and one or more additional paying agents.  The term “Registrar” includes any
co-registrar and the term “Paying Agent” includes any additional paying
agent.  The Issuers may change any Paying
Agent or Registrar without notice to any Holder.  The Issuers shall notify the Trustee in
writing of the name and address of any Agent not a party to this
Indenture.  If the Issuers fail to
appoint or maintain another entity as Registrar or Paying Agent, the Trustee
shall act as such.  The Issuers or any of
their Subsidiaries may act as Paying Agent or Registrar.  The Issuers initially appoint The Depository
Trust Company (“DTC”) to act as Depositary with respect to the Global
Notes.  The Issuers initially appoint the
Trustee to act as the Registrar and Paying Agent and to act as Notes Custodian
with respect to the Global Notes.

 

Section 2.4                                                              Paying Agent to
Hold Money in Trust

 

The Issuers shall require each Paying Agent other
than the Trustee to agree in writing that the Paying Agent shall hold in trust
for the benefit of Holders or the Trustee all money held by the Paying Agent
for the payment of principal, premium or interest on the Notes, and shall
notify the Trustee of any default by the Issuers in making any such
payment.  While any such default
continues, the Trustee may require a Paying Agent to pay all money held by it
to the Trustee.  The Issuers at any time
may require a Paying Agent to pay all money held by it to the Trustee.  Upon payment over to the Trustee, the Paying
Agent (if other than the Issuers or a Subsidiary) shall have no further
liability for the money.  If either
Issuer or a Subsidiary acts as Paying Agent, it shall segregate and hold in a
separate trust fund for the benefit of the Holders all money held by it as
Paying Agent.  Upon any bankruptcy or reorganization
proceedings relating to the Issuers, the Trustee shall serve as Paying Agent
for the Notes.

 

Section 2.5                                                              Holder Lists

 

The Trustee shall preserve in as current a form as
is reasonably practicable the most recent list available to it of the names and
addresses of all Holders and shall otherwise comply with TIA
§ 312(a).  If the Trustee is not the
Registrar, the Issuers shall furnish, or shall cause the Registrar (if other
than an Issuer) to furnish, to the Trustee at least seven Business Days before
each Interest Payment Date and at such other times as the Trustee may request
in writing, a list in such form and as of such date as the Trustee may
reasonably require of the names and addresses of the Holders of Notes and the
Issuers shall otherwise comply with TIA § 312(a).

 

Section 2.6                                                              Transfer and
Exchange

 

(a)           Transfer and Exchange of Global Notes.  A Global Note may not be transferred as a
whole except by the Depositary to a nominee of the Depositary, by a nominee of
the Depositary to the Depositary or to another nominee of the Depositary, or by
the Depositary or any such nominee to a successor Depositary or a nominee of
such successor Depositary.  All Global
Notes shall be exchanged by the Issuers for Definitive Notes only if (i) the
Issuers deliver to the Trustee notice from the Depositary that (x) the
Depositary is unwilling or unable to continue to act as Depositary for the
Global Notes and the Issuers thereupon fail to appoint a successor Depositary
within 90 days or (y) the Depositary is no longer a clearing agency
registered under the Exchange Act, (ii) the Issuers in their sole
discretion determine that the Global Notes (in whole but not in part) should be
exchanged for Definitive Notes and deliver a written notice to such effect to
the Trustee or (iii) upon request of the Trustee or Holders of a majority
of the aggregate principal amount of outstanding Notes if there shall have
occurred and be continuing a Default or Event of Default with respect to the
Notes; provided that in no event shall the
Regulation S Temporary Global Note be exchanged by the Issuers for Definitive
Notes 

 

29

 

prior to (x) the expiration of the
Distribution Compliance Period and (y) the receipt by the Registrar of any
certificate identified by the Issuers and its counsel to be required pursuant
to Rule 903 or Rule 904 under the Securities Act.  Upon the occurrence of any of the preceding
events in (i), (ii) or (iii) above, Definitive Notes shall be issued
in such names as the Depositary shall instruct the Trustee.  Global Notes also may be exchanged or
replaced, in whole or in part, as provided in Sections 2.7 and 2.10
hereof.  A Global Note may not be
exchanged for another Note other than as provided in this Section 2.6(a);
however, beneficial interests in a Global Note may be transferred and exchanged
as provided in Section 2.6(b), (c) or (f) hereof.

 

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

 

(i)            Transfer of Beneficial Interests in the Same Global
Note.  Beneficial interests in any
Restricted Global Note may be transferred to Persons who take delivery thereof
in the form of a beneficial interest in the same Restricted Global Note in
accordance with the transfer restrictions set forth in the Private Placement
Legend; provided, however,
that prior to the expiration of the Distribution Compliance Period, transfers
of beneficial interests in the Regulation S Temporary Global Note may not be
made to a U.S. Person or for the account or benefit of a U.S. Person (other
than an Initial Purchaser).  Beneficial
interests in any Unrestricted Global Note may be transferred to Persons who
take delivery thereof in the form of a beneficial interest in an Unrestricted
Global Note.  No written orders or
instructions shall be required to be delivered to the Registrar to effect the
transfers described in this Section 2.6(b)(i).

 

(ii)           All Other Transfers and Exchanges of Beneficial Interests
in Global Notes.  In connection with all
transfers and exchanges of beneficial interests that are not subject to Section 2.6(b)(i) above,
the transferor of such beneficial interest must deliver to the Registrar either
(A) (1) an order from a Participant or an Indirect Participant given
to the Depositary in accordance with the Applicable Procedures directing the
Depositary to credit or cause to be credited a beneficial interest in another
Global Note in an amount equal to the beneficial interest to be transferred or
exchanged, and (2) instructions given in accordance with the Applicable
Procedures containing information regarding the Participant account to be
credited with such increase; or (B) (1) an order from a Participant
or an Indirect Participant given to the Depositary in accordance with the
Applicable Procedures directing the Depositary to cause to be issued a
Definitive Note in an amount equal to the beneficial interest to be transferred
or exchanged, and (2) instructions given by the Depositary to the
Registrar containing information regarding the Person in whose name such
Definitive Note shall be registered to effect the transfer or exchange referred
to in (B)(1) above; provided, that
in no event shall Definitive Notes be issued upon the transfer or exchange of
beneficial interests in the Regulation S Temporary Global Note prior to (x) the
expiration of the Distribution Compliance Period and (y) the receipt by
the Registrar of any certificates identified by the Issuers or its counsel to
be required pursuant to Rule 903 and Rule 904 under the Securities
Act.  Upon satisfaction of all of the
requirements for transfer or exchange of beneficial interests in Global Notes
contained in this Indenture and the Notes or otherwise applicable under the Securities
Act, the Trustee shall adjust the principal amount of the relevant Global Note(s) pursuant
to Section 2.6(h) hereof.

 

30

 

(iii)          Transfer of Beneficial Interests to Another Restricted
Global Note.  A beneficial interest in
any Restricted Global Note may be transferred to a Person who takes delivery
thereof in the form of a beneficial interest in another Restricted Global Note
if the transfer complies with the requirements of Section 2.6(b)(ii) above
and the Registrar receives the following:

 

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

 

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

 

(iv)          Transfer and Exchange of Beneficial Interests in a
Restricted Global Note for Beneficial Interests in the Unrestricted Global
Note.  A beneficial interest in any
Restricted Global Note may be exchanged by any holder thereof for a beneficial
interest in an Unrestricted Global Note or transferred to a Person who takes
delivery thereof in the form of a beneficial interest in an Unrestricted Global
Note if the exchange or transfer complies with the requirements of Section 2.6(b)(ii) above
and the Registrar receives the following: 
(1) if the holder of such beneficial interest in a Restricted
Global Note proposes to exchange such beneficial interest for a beneficial
interest in an Unrestricted Global Note, a certificate from such holder in the
form of Exhibit C hereto, including the certifications in item (1)(a) thereof;
or (2) if the holder of such beneficial interest in a Restricted Global
Note proposes to transfer such beneficial interest to a Person who shall take
delivery thereof in the form of a beneficial interest in an Unrestricted Global
Note, a certificate from such holder in the form of Exhibit B hereto,
including the certifications in item (4) thereof; and, in each such case
set forth in this subparagraph (iv), an Opinion of Counsel in form, and from
legal counsel, reasonably acceptable to the Registrar and the Issuers to the
effect that such exchange or transfer is in compliance with the Securities Act
and that the restrictions on transfer contained herein and in the Private
Placement Legend are no longer required in order to maintain compliance with
the Securities Act.

 

If any such transfer is effected pursuant to this
paragraph (iv) at a time when an Unrestricted Global Note has not yet been
issued, the Issuers shall issue and, upon receipt of an Authentication Order in
accordance with Section 2.2 hereof, the Trustee shall authenticate one or
more Unrestricted Global Notes in an aggregate principal amount equal to the
aggregate principal amount of beneficial interests transferred pursuant to this
paragraph (iv).  Beneficial interests in
an Unrestricted Global Note cannot be exchanged for, or transferred to Persons
who take delivery thereof in the form of, a beneficial interest in a Restricted
Global Note.

 

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

 

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

 

(A)          if the holder of such beneficial interest in a Restricted
Global Note proposes to exchange such beneficial interest for a Restricted
Definitive 

 

31

 

Note, a certificate from such holder in the
form of Exhibit C hereto, including the certifications in item (2)(a) thereof;

 

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

 

(C)           if such beneficial interest is being transferred to a
Non-U.S. Person in an offshore transaction in accordance with Rule 903 or Rule 904
under the Securities Act, a certificate to the effect set forth in Exhibit B
hereto, including the certifications in item (2) thereof;

 

(D)          if such beneficial interest is being transferred pursuant
to an exemption from the registration requirements of the Securities Act in
accordance with Rule 144, a certificate to the effect set forth in Exhibit B
hereto, including the certifications in item (3)(a) thereof;

 

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

 

(F)           if such beneficial interest is being transferred pursuant
to an effective registration statement under the Securities Act, a certificate
to the effect set forth in Exhibit B hereto, including the certifications
in item (3)(c) thereof,

 

the Trustee shall cause the aggregate
principal amount of the applicable Restricted Global Note to be reduced
accordingly pursuant to Section 2.6(h) hereof, and the Issuers shall
execute and, upon receipt of an Authentication Order pursuant to Section 2.2
hereof, the Trustee shall authenticate and deliver to the Person designated in
the instructions a Restricted Definitive Note in the appropriate principal
amount.  Any Restricted Definitive Note
issued in exchange for a beneficial interest in a Restricted Global Note
pursuant to this Section 2.6(c) shall be registered in such name or
names and in such authorized denomination or denominations as the holder of
such beneficial interest shall instruct the Registrar through instructions from
the Depositary and the Participant or Indirect Participant.  The Trustee shall deliver such Restricted
Definitive Notes to the Persons in whose names such Notes are so
registered.  Any Restricted Definitive
Note issued in exchange for a beneficial interest in a Restricted Global Note
pursuant to this Section 2.6(c)(i) shall bear the Private Placement
Legend and shall be subject to all restrictions on transfer contained therein.

 

(ii)           Beneficial Interests in Restricted Global Notes to
Unrestricted Definitive Notes.  A holder of
a beneficial interest in a Restricted Global Note may exchange such beneficial
interest for an Unrestricted Definitive Note or may transfer such beneficial
interest to a Person who takes delivery thereof in the form of an Unrestricted
Definitive Note only if the Registrar receives the following:  (1) if the holder of such beneficial
interest in a Restricted Global Note proposes to exchange such beneficial
interest for a Definitive Note that does not bear the Private Placement Legend,
a certificate from such holder in the form of Exhibit C hereto, including
the certifications in item (1)(b) thereof; or (2) if the holder of
such beneficial interest in a Restricted Global Note proposes to transfer such
beneficial interest to a Person who shall take delivery thereof in the form of
a Definitive Note that does not bear the Private Placement Legend, a
certificate from such holder in the form of Exhibit B hereto, including
the certifications in item (4) thereof; and, in each such case set forth
in this paragraph, an Opinion of Counsel in form, and 

 

32

 

from legal counsel, reasonably acceptable to
the Registrar and the Issuers to the effect that such exchange or transfer is
in compliance with the Securities Act and that the restrictions on transfer
contained herein and in the Private Placement Legend are no longer required in
order to maintain compliance with the Securities Act.

 

(iii)          Beneficial Interests in Unrestricted Global Notes to
Unrestricted Definitive Notes.  If any
holder of a beneficial interest in an Unrestricted Global Note proposes to
exchange such beneficial interest for an Unrestricted Definitive Note or to
transfer such beneficial interest to a Person who takes delivery thereof in the
form of an Unrestricted Definitive Note, then, upon satisfaction of the
conditions set forth in Section 2.6(b)(ii) hereof, the Trustee shall
cause the aggregate principal amount of the applicable Unrestricted Global Note
to be reduced accordingly pursuant to Section 2.6(h) hereof, and the
Issuers shall execute and, upon receipt of an Authentication Order pursuant to Section 2.2
hereof, the Trustee shall authenticate and deliver to the Person designated in
the instructions an Unrestricted Definitive Note in the appropriate principal
amount.  Any Unrestricted Definitive Note
issued in exchange for a beneficial interest pursuant to this Section 2.6(c)(iii) shall
be registered in such name or names and in such authorized denomination or
denominations as the holder of such beneficial interest shall instruct the
Registrar through instructions from the Depositary and the Participant or
Indirect Participant.  The Trustee shall
deliver such Unrestricted Definitive Notes to the Persons in whose names such
Notes are so registered.  Any Unrestricted
Definitive Note issued in exchange for a beneficial interest pursuant to this Section 2.6(c)(iii) shall
not bear the Private Placement Legend.

 

(iv)          Transfer or Exchange of Regulation S Temporary Global
Notes.  Notwithstanding the other provisions
of this Section 2.6, a beneficial interest in the Regulation S Temporary
Global Note may not be (A) exchanged for a Definitive Note prior to (x) the
expiration of the Distribution Compliance Period (unless such exchange is
effected by the Issuers, does not require an investment decision on the part of
the holder thereof and does not violate the provisions of Regulation S) and (y) the
receipt by the Registrar of any certificates identified by the Issuers or its
counsel to be required pursuant to Rule 903(c)(3)(B) under the
Securities Act or (B) transferred to a Person who takes delivery thereof
in the form of a Definitive Note prior to the events set forth in clause (A) above
or unless the transfer is pursuant to an exemption from the registration requirements
of the Securities Act other than Rule 903 or Rule 904.

 

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

 

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

 

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

 

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

 

33

 

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

 

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

 

(ii)           Restricted Definitive Notes to Beneficial Interests in
Unrestricted Global Notes.  A Holder of a
Restricted Definitive Note may exchange such Note for a beneficial interest in
an Unrestricted Global Note or transfer such Restricted Definitive Note to a
Person who takes delivery thereof in the form of a beneficial interest in an
Unrestricted Global Note only if the Registrar receives the following:  (1) if the Holder of such Restricted
Definitive Notes proposes to exchange such Notes for a beneficial interest in
the Unrestricted Global Note, a certificate from such Holder in the form of Exhibit C
hereto, including the certifications in item (1)(c) thereof; or (2) if
the Holder of such Restricted Definitive Notes proposes to transfer such Notes
to a Person who shall take delivery thereof in the form of a beneficial
interest in the Unrestricted Global Note, a certificate from such Holder in the
form of Exhibit B hereto, including the certifications in item (4) thereof;
and, in each such case set forth in this paragraph, an Opinion of Counsel in
form, and from legal counsel, reasonably acceptable to the Registrar and the
Issuers to the effect that such exchange or transfer is in compliance with the
Securities Act and that the restrictions on transfer contained herein and in
the Private Placement Legend are no longer required in order to maintain compliance
with the Securities Act.  Upon
satisfaction of the conditions of any of the subparagraphs in this Section 2.6(d)(ii),
the Trustee shall cancel the Restricted Definitive Notes so transferred or
exchanged and increase or cause to be increased the aggregate principal amount
of the Unrestricted Global Note.

 

(iii)          Unrestricted Definitive Notes to Beneficial Interests in
Unrestricted Global Notes.  A Holder of
an Unrestricted Definitive Note may exchange such Note for a beneficial
interest in an Unrestricted Global Note or transfer such Definitive Notes to a
Person who takes delivery thereof in the form of a beneficial interest in an
Unrestricted Global Note at any time. 
Upon receipt of a request for such an exchange or transfer, the Trustee
shall cancel the applicable Unrestricted Definitive Note and increase or cause
to be increased the aggregate principal amount of one of the Unrestricted
Global Notes.  If any such exchange or
transfer from a Definitive Note to a beneficial interest is effected pursuant
to subparagraphs (ii) or (iii) of this Section 2.6(d) at a
time when an Unrestricted Global Note has not yet been issued, the Issuers
shall issue and, upon receipt of an Authentication Order in accordance with Section 2.2
hereof, the Trustee shall authenticate one or more Unrestricted Global Notes in
an aggregate principal amount equal to the principal amount of Definitive Notes
so transferred.

 

(e)           Transfer and Exchange of Definitive Notes for Definitive
Notes.  Upon request by a Holder of
Definitive Notes and such Holder’s compliance with the provisions of this Section 2.6(e),
the Registrar shall register the transfer or exchange of Definitive Notes.  Prior to such registration of transfer or
exchange, the requesting Holder shall present or surrender to the Registrar the
Definitive Notes duly endorsed or accompanied by a written instruction of
transfer in form satisfactory to the Registrar duly executed by such Holder or
by its attorney, duly authorized in writing. 
In addition, the requesting Holder shall provide any additional
certifications, documents and information, as applicable, required pursuant to
the following provisions of this Section 2.6(e).

 

34

 

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

 

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

 

(B)           if the transfer shall be
made pursuant to Rule 903 or Rule 904 under the Securities Act, then
the transferor must deliver a certificate in the form of Exhibit B hereto,
including the certifications in item (2) thereof; and

 

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

 

(ii)           Restricted Definitive Notes
to Unrestricted Definitive Notes.  Any
Restricted Definitive Note may be exchanged by the Holder thereof for an
Unrestricted Definitive Note or transferred to a Person or Persons who take
delivery thereof in the form of an Unrestricted Definitive Note if the
Registrar receives the following:  (1) if
the Holder of such Restricted Definitive Notes proposes to exchange such Notes
for an Unrestricted Definitive Note, a certificate from such Holder in the form
of Exhibit C hereto, including the certifications in item (1)(d) thereof;
or (2) if the Holder of such Restricted Definitive Notes proposes to
transfer such Notes to a Person who shall take delivery thereof in the form of
an Unrestricted Definitive Note, a certificate from such Holder in the form of Exhibit B
hereto, including the certifications in item (4) thereof; and, in each
such case set forth in this subparagraph (ii), an Opinion of Counsel in form,
and from legal counsel, reasonably acceptable to the Registrar and the Issuers
to the effect that such exchange or transfer is in compliance with the
Securities Act and that the restrictions on transfer contained herein and in
the Private Placement Legend are no longer required in order to maintain
compliance with the Securities Act.

 

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

 

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

 

(i)            Private Placement Legend.

 

(A)          Except as permitted by
subparagraph (B) below, each Global Note and each Definitive Note (and all
Notes issued in exchange therefor or substitution thereof) shall bear the
legend in substantially the following form:

 

“THIS NOTE (OR ITS PREDECESSOR) WAS
ORIGINALLY ISSUED IN A TRANSACTION EXEMPT FROM REGISTRATION UNDER THE UNITED
STATES 

 

35

 

SECURITIES ACT OF 1933, AS AMENDED (THE “SECURITIES
ACT”), AND THIS NOTE MAY NOT BE OFFERED, SOLD OR OTHERWISE TRANSFERRED IN
THE ABSENCE OF SUCH REGISTRATION OR AN APPLICABLE EXEMPTION THEREFROM.  EACH PURCHASER OF THIS NOTE IS HEREBY
NOTIFIED THAT THE SELLER OF THIS NOTE MAY BE RELYING ON THE EXEMPTION FROM
THE PROVISIONS OF SECTION 5 OF THE SECURITIES ACT PROVIDED BY RULE 144A
THEREUNDER.

 

“THE HOLDER OF THIS NOTE AGREES FOR THE
BENEFIT OF THE COMPANY THAT (A) THIS NOTE MAY BE OFFERED, RESOLD, PLEDGED
OR OTHERWISE TRANSFERRED, ONLY (i) IN THE UNITED STATES TO A PERSON WHOM
THE SELLER REASONABLY BELIEVES IS A QUALIFIED INSTITUTIONAL BUYER (AS DEFINED
IN RULE 144A UNDER THE SECURITIES ACT) IN A TRANSACTION MEETING THE
REQUIREMENTS OF RULE 144A, (ii) OUTSIDE THE UNITED STATES IN AN OFFSHORE
TRANSACTION IN ACCORDANCE WITH RULE 904 UNDER THE SECURITIES ACT, (iii) PURSUANT
TO AN EXEMPTION FROM REGISTRATION UNDER THE SECURITIES ACT PROVIDED BY RULE 144
THEREUNDER (IF AVAILABLE) OR (iv) PURSUANT TO AN EFFECTIVE REGISTRATION
STATEMENT UNDER THE SECURITIES ACT, IN EACH OF CASES (i) THROUGH (iv) IN
ACCORDANCE WITH ANY APPLICABLE SECURITIES LAWS OF ANY STATE OF THE UNITED
STATES, AND (B) THE HOLDER WILL, AND EACH SUBSEQUENT HOLDER IS REQUIRED
TO, NOTIFY ANY PURCHASER OF THIS NOTE FROM IT OF THE RESALE RESTRICTIONS
REFERRED TO IN (A) ABOVE.”

 

(B)           Notwithstanding the
foregoing, any Global Note or Definitive Note issued pursuant to subparagraphs
(b)(iv), (c)(ii), (c)(iii), (d)(ii), (d)(iii), (e)(ii) or (e)(iii) to
this Section 2.6 (and all Notes issued in exchange therefor or
substitution thereof) shall not bear the Private Placement Legend.

 

(ii)           Global Note Legend.  To the extent required by the Depositary,
each Global Note shall bear legends in substantially the following forms:

 

“THIS GLOBAL NOTE IS HELD BY THE DEPOSITARY
(AS DEFINED IN THE INDENTURE GOVERNING THIS NOTE) OR ITS NOMINEE IN CUSTODY FOR
THE BENEFIT OF THE BENEFICIAL OWNERS HEREOF, AND IS NOT TRANSFERABLE TO ANY
PERSON UNDER ANY CIRCUMSTANCES EXCEPT THAT (I) THE TRUSTEE MAY MAKE
SUCH NOTATIONS HEREON AS MAY BE REQUIRED PURSUANT TO SECTION 2.6 OF
THE INDENTURE, (II) THIS GLOBAL NOTE MAY BE EXCHANGED IN WHOLE BUT
NOT IN PART PURSUANT TO SECTION 2.6(a) OF THE INDENTURE, (III) THIS
GLOBAL NOTE MAY BE DELIVERED TO THE TRUSTEE FOR CANCELLATION PURSUANT TO SECTION 2.11
OF THE INDENTURE AND (IV) THIS GLOBAL NOTE MAY BE TRANSFERRED TO A
SUCCESSOR DEPOSITARY WITH THE PRIOR WRITTEN CONSENT OF THE ISSUERS.”

 

“UNLESS AND UNTIL IT IS EXCHANGED IN WHOLE OR
IN PART FOR NOTES IN DEFINITIVE FORM, THIS NOTE MAY NOT BE
TRANSFERRED EXCEPT AS A WHOLE BY THE DEPOSITARY TO A NOMINEE OF THE DEPOSITARY
OR BY A NOMINEE OF THE

 

36

 

DEPOSITARY TO THE DEPOSITARY OR ANOTHER
NOMINEE OF THE DEPOSITARY OR BY THE DEPOSITARY OR ANY SUCH NOMINEE TO A
SUCCESSOR DEPOSITARY OR A NOMINEE OF SUCH SUCCESSOR DEPOSITARY.  UNLESS THIS CERTIFICATE IS PRESENTED BY AN
AUTHORIZED REPRESENTATIVE OF THE DEPOSITORY TRUST COMPANY (55 WATER STREET, NEW
YORK, NEW YORK) (“DTC”), TO THE ISSUERS OR THEIR AGENT FOR REGISTRATION OF
TRANSFER, EXCHANGE OR PAYMENT, AND ANY CERTIFICATE ISSUED IS REGISTERED IN THE
NAME OF CEDE & CO. OR SUCH OTHER NAME AS MAY BE REQUESTED BY AN
AUTHORIZED REPRESENTATIVE OF DTC (AND ANY PAYMENT IS MADE TO CEDE &
CO. OR SUCH OTHER ENTITY AS MAY BE REQUESTED BY AN AUTHORIZED
REPRESENTATIVE OF DTC), ANY TRANSFER, PLEDGE OR OTHER USE HEREOF FOR VALUE OR
OTHERWISE BY OR TO ANY PERSON IS WRONGFUL INASMUCH AS THE REGISTERED OWNER
HEREOF, CEDE & CO., HAS AN INTEREST HEREIN.”

 

(iii)          Regulation S Temporary
Global Note Legend.  To the extent
required by the Depositary, each Regulation S Temporary Global Note shall bear
a legend in substantially the following form:

 

“THE RIGHTS ATTACHING TO THIS REGULATION S
TEMPORARY GLOBAL NOTE, AND THE CONDITIONS AND PROCEDURES GOVERNING ITS EXCHANGE
FOR DEFINITIVE NOTES, ARE AS SPECIFIED IN THE INDENTURE (AS DEFINED
HEREIN).  NEITHER THE HOLDER NOR THE
BENEFICIAL OWNERS OF THIS REGULATION S TEMPORARY GLOBAL NOTE SHALL BE ENTITLED
TO RECEIVE CASH PAYMENTS OF INTEREST DURING THE PERIOD WHICH SUCH HOLDER HOLDS
THIS NOTE.  NOTHING IN THIS LEGEND SHALL
BE DEEMED TO PREVENT INTEREST FROM ACCRUING ON THIS NOTE.”

 

(iv)          Regulation S Global Note
Legend.  To the extent required by the
Depositary, each Regulation S Global Note shall bear a legend in substantially
the following form:

 

“THIS NOTE (OR ITS PREDECESSOR) WAS
ORIGINALLY ISSUED IN A TRANSACTION ORIGINALLY EXEMPT FROM REGISTRATION UNDER
THE U.S. SECURITIES ACT OF 1933, AS AMENDED (THE “SECURITIES ACT”), AND MAY NOT
BE TRANSFERRED IN THE UNITED STATES OR TO, OR FOR THE ACCOUNT OR BENEFIT OF,
ANY U.S. PERSON EXCEPT PURSUANT TO AN AVAILABLE EXEMPTION FROM THE REGISTRATION
REQUIREMENTS OF THE SECURITIES ACT AND ALL APPLICABLE STATE SECURITIES
LAWS.  TERMS USED ABOVE HAVE THE MEANINGS
GIVEN TO THEM IN REGULATION S UNDER THE SECURITIES ACT.”

 

(g)           Cancellation and/or
Adjustment of Global Notes.  At such time
as all beneficial interests in a particular Global Note have been exchanged for
Definitive Notes or a particular Global Note has been redeemed, repurchased or
cancelled in whole and not in part, each such Global Note shall be returned to
or retained and cancelled by the Trustee in accordance with Section 2.11
hereof.  At any time prior to such
cancellation, if any beneficial interest in a

 

37

 

Global Note is exchanged for or transferred
to a Person who shall take delivery thereof in the form of a beneficial
interest in another Global Note or for Definitive Notes, the principal amount
of Notes represented by such Global Note shall be reduced accordingly and an
endorsement may be made on such Global Note by the Trustee or by the Depositary
at the direction of the Trustee to reflect such reduction; and if the
beneficial interest is being exchanged for or transferred to a Person who shall
take delivery thereof in the form of a beneficial interest in another Global
Note, such other Global Note shall be increased accordingly and an endorsement
may be made on such Global Note by the Trustee or by the Depositary at the
direction of the Trustee to reflect such increase.

 

(h)           General Provisions Relating
to Transfers and Exchanges.

 

(i)            To permit registrations of
transfers and exchanges, the Issuers shall execute and the Trustee shall
authenticate Global Notes and Definitive Notes upon receipt of an
Authentication Order.

 

(ii)           No service charge shall be
made to a holder of a beneficial interest in a Global Note or to a Holder of a
Definitive Note for any registration of transfer or exchange, but the Issuers
may require payment of a sum sufficient to cover any transfer tax or similar
governmental charge payable in connection therewith (other than any such
transfer taxes or similar governmental charge payable upon exchange or transfer
pursuant to Sections 2.10, 3.6, 4.13 and 4.14 hereof).

 

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

 

(iv)          All Global Notes and
Definitive Notes issued upon any registration of transfer or exchange of Global
Notes or Definitive Notes shall be the valid obligations of the Issuers,
evidencing the same Indebtedness, and entitled to the same benefits under this
Indenture, as the Global Notes or Definitive Notes surrendered upon such
registration of transfer or exchange.

 

(v)           The Issuers shall not be
required (A) to issue, to register the transfer of or to exchange any
Notes during a period beginning at the opening of business 15 days before the
day of any selection of Notes for redemption under Section 3.2 hereof and
ending at the close of business on the day of selection, (B) to register
the transfer of or to exchange any Note so selected for redemption in whole or
in part, except the unredeemed portion of any Note being redeemed in part or (C) to
register the transfer of or to exchange a Note between a Record Date and the
next succeeding Interest Payment Date.

 

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

 

(vii)         The Trustee shall
authenticate Global Notes and Definitive Notes in accordance with the provisions
of Section 2.2 hereof.

 

38

 

(viii)        All certifications,
certificates and Opinions of Counsel required to be submitted to the Registrar
pursuant to this Section 2.6 to effect a registration of transfer or exchange
may be submitted by facsimile.

 

Notwithstanding anything herein to the contrary, as
to any certifications and certificates delivered to the Registrar pursuant to
this Section 2.6, the Registrar’s duties shall be limited to confirming
that any such certifications and certificates delivered to it are in the form
of Exhibits B and C attached hereto.  The
Registrar shall not be responsible for confirming the truth or accuracy of
representations made in any such certifications or certificates.

 

Section 2.7                     Replacement
Notes

 

If any mutilated Note is surrendered to the Trustee
or the Issuers and the Trustee and the Issuers receive evidence (which evidence
may be from the Trustee) to their satisfaction of the destruction, loss or
theft of any Note, the Issuers shall issue and the Trustee, upon receipt of an
Authentication Order, shall authenticate a replacement Note if the Trustee’s
requirements are met.  If required by the
Trustee or the Issuers, an indemnity bond must be supplied by the Holder that
is sufficient in the judgment of the Trustee and the Issuers to protect the
Issuers, the Trustee, any Agent and any authenticating agent from any loss that
any of them may suffer if a Note is replaced. 
The Issuers may charge for its expenses in replacing a Note.  Every replacement Note is an additional
obligation of the Issuers and shall be entitled to all of the benefits of this
Indenture equally and proportionately with all other Notes duly issued
hereunder.

 

Section 2.8                     Outstanding
Notes

 

The Notes outstanding at any time are all the Notes
authenticated by the Trustee (including any Note represented by a Global Note)
except for those cancelled by it or at its direction, those delivered to it for
cancellation, those reductions in the interest in a Global Note effected by the
Trustee in accordance with the provisions hereof, and those described in this Section 2.8
as not outstanding.  Except as set forth
in Section 2.9 hereof, a Note does not cease to be outstanding because the
Issuers or an Affiliate of the Issuers holds the Note.  If a Note is replaced pursuant to Section 2.7
hereof, such Note, together with the Guarantee of that particular Note endorsed
thereon, ceases to be outstanding unless the Trustee receives proof
satisfactory to it that the replaced Note is held by a bona fide
purchaser.  If the principal amount of
any Note is considered paid under Section 4.1 hereof, it ceases to be
outstanding and interest on it ceases to accrue.  If the Paying Agent (other than an Issuer, a
Subsidiary or an Affiliate of any thereof) holds, on a Redemption Date or the
maturity date, money sufficient to pay Notes payable on that date, then on and
after that date such Notes shall be deemed to be no longer outstanding and
shall cease to accrue interest.

 

Section 2.9                     Treasury Notes

 

In determining whether the Holders of the required
principal amount of Notes have concurred in any direction, waiver or consent,
Notes owned by the Issuers, or by any Person directly or indirectly controlling
or controlled by or under direct or indirect common control with the Issuers,
shall be considered as though not outstanding, except that for the purposes of
determining whether the Trustee shall be protected in relying on any such
direction, waiver or consent, only Notes that the Trustee knows are so owned
shall be so disregarded.

 

Section 2.10                   Temporary Notes

 

39

 

Until certificates representing Notes are ready for
delivery, the Issuers may prepare and the Trustee, upon receipt of an
Authentication Order, shall authenticate temporary Notes.  Temporary Notes shall be substantially in the
form of Definitive Notes but may have variations that the Issuers consider
appropriate for temporary Notes and shall be reasonably acceptable to the
Trustee.  Without unreasonable delay, the
Issuers shall prepare and the Trustee shall authenticate Definitive Notes in
exchange for temporary Notes.  Holders of
temporary Notes shall be entitled to all of the benefits of this Indenture.

 

Section 2.11                   Cancellation

 

The Issuers at any time may deliver Notes to the
Trustee for cancellation.  The Registrar
and Paying Agent shall forward to the Trustee any Notes surrendered to them for
registration of transfer, exchange or payment. 
The Trustee, or at the direction of the Trustee, the Registrar or the
Paying Agent (other than the Issuers or an Affiliate of the Issuers), and no
one else shall cancel all Notes surrendered for registration of transfer,
exchange, payment, replacement or cancellation and shall dispose of such cancelled
Notes in accordance with its customary procedures (subject to the record
retention requirement of the Exchange Act). 
Certification of the destruction of all cancelled Notes shall be
delivered to the Issuers.  The Issuers
may not issue new Notes to replace Notes that it has paid or that have been
delivered to the Trustee for cancellation.

 

Section 2.12                   Defaulted
Interest

 

Any interest on any Note which is payable, but is
not punctually paid or duly provided for, on any Interest Payment Date plus, to
the extent lawful, any interest payable on the defaulted interest at the rate
and in the manner provided in Section 4.1 hereof and in the Note (herein
called “Defaulted Interest”) shall forthwith cease to be payable to the
registered Holder on the relevant Record Date, and such Defaulted Interest may
be paid by the Issuers, at their election in each case, as provided in clause (1) or
(2) below:

 

(1)           The Issuers may elect to make payment of any
Defaulted Interest to the Persons in whose names the Notes are registered at
the close of business on a Special Record Date for the payment of such
Defaulted Interest, which shall be fixed in the following manner.  The Issuers shall notify the Trustee and the
Paying Agent in writing of the amount of Defaulted Interest proposed to be paid
on each Note and the date of the proposed payment, and at the same time the
Issuers shall deposit with the Paying Agent an amount of cash equal to the
aggregate amount proposed to be paid in respect of such Defaulted Interest or
shall make arrangements reasonably satisfactory to the Paying Agent for such
deposit prior to the date of the proposed payment, such cash when deposited to
be held in trust for the benefit of the Persons entitled to such Defaulted
Interest as provided in this clause (1). 
Thereupon the Paying Agent shall fix a “Special Record Date” for the
payment of such Defaulted Interest which shall be not more than 15 days and not
less than 10 days prior to the date of the proposed payment and not less than
10 days after the receipt by the Paying Agent of the notice of the proposed
payment.  The Paying Agent shall promptly
notify the Issuers and the Trustee of such Special Record Date and, in the name
and at the expense of the Issuers, shall cause notice of the proposed payment
of such Defaulted Interest and the Special Record Date therefor to be mailed,
first-class postage prepaid, to each Holder at its address as it appears in the
Note register maintained by the Registrar not less than 10 days prior to such
Special Record Date.  Notice of the 

 

40

 

proposed payment of such Defaulted Interest and the Special Record Date
therefor having been mailed as aforesaid, such Defaulted Interest shall be paid
to the persons in whose names the Notes (or their respective predecessor Notes)
are registered on such Special Record Date and shall no longer be payable
pursuant to the following clause (2).

 

(2)           The Issuers may make payment
of any Defaulted Interest in any other lawful manner not inconsistent with the
requirements of any securities exchange on which the Notes may be listed, and
upon such notice as may be required by such exchange, if, after notice given by
the Issuers to the Trustee and the Paying Agent of the proposed payment
pursuant to this clause, such manner as shall be deemed practicable by the
Trustee and the Paying Agent.

 

Subject to the foregoing provisions of this Section 2.12,
each Note delivered under this Indenture upon registration of transfer of or in
exchange for or in lieu of any other Note shall carry the rights to interest
accrued and unpaid, and to accrue, which were carried by such other Note.

 

Section 2.13                   CUSIP Numbers

 

The Issuers in issuing the Notes may use “CUSIP”
numbers (if then generally in use), and, if so, the Trustee shall use “CUSIP”
numbers in notices of redemption as a convenience to Holders; provided that any such notice may state that no
representation is made as to the correctness of such numbers either as printed
on the Notes or as contained in any notice of a redemption and that reliance
may be placed only on the other identification numbers printed on the Notes,
and any such redemption shall not be affected by any defect in or omission of
such numbers.  The Issuers shall promptly
notify the Trustee of any change in the “CUSIP” numbers.

 

Section 2.14                   Issuance of
Additional Notes

 

The Issuers may, subject to Section 4.7 hereof
and applicable law, issue Additional Notes under this Indenture having
identical terms and conditions to the Notes issued on the Issue Date.  Interest will accrue on the Additional Notes
issued pursuant to this Indenture from and including the date of issuance of
such Additional Notes.  Any such
Additional Notes would be issued on the same terms as the Notes, would
constitute part of the same series of securities as the Notes, would vote
together as one series on all matters with respect to the Notes and would be “fungible”
under the original issue discount provisions of the Internal Revenue Code of
1986, as amended.

 

ARTICLE III

 

REDEMPTION

 

Section 3.1                     Notices to
Trustee

 

In addition to the notice provision of Section 3.3
hereof, if the Issuers elect to redeem Notes pursuant to the optional
redemption provisions of Section 3.7 hereof, they shall furnish to the
Trustee, at least 30 days (unless a shorter period is acceptable to the
Trustee) but not more than 60 days (unless a longer period is acceptable to the
Trustee) before a Redemption Date, an Officers’ Certificate setting forth (i) the
clause of this Indenture pursuant to which the 

 

41

 

redemption shall occur, (ii) the
Redemption Date, (iii) the principal amount of Notes to be redeemed and (iv) the
redemption price.

 

Section 3.2                     Selection of
Notes to Be Redeemed

 

If less than all of the Notes are to be redeemed at
any time, the Trustee shall select the Notes or portions thereof to be redeemed
among the Holders of the Notes in compliance with the requirements of the
principal national securities exchange, if any, on which the Notes are listed
or, if the Notes are not so listed, on a pro rata basis,
by lot or in accordance with any other method the Trustee considers fair and
appropriate.  In the event of partial
redemption by lot, the particular Notes to be redeemed shall be selected, unless
otherwise provided herein, not less than 30 nor more than 60 days prior to the
Redemption Date by the Trustee from the outstanding Notes not previously called
for redemption.

 

The Trustee shall promptly notify the Issuers in
writing of the Notes selected for redemption and, in the case of any Note
selected for partial redemption, the principal amount thereof to be
redeemed.  Notes and portions of Notes in
denominations of larger than $1,000 selected shall be in amounts of $1,000 or
integral multiples of $1,000; except that if all of the Notes of a Holder are
to be redeemed, the entire outstanding amount of Notes held by such Holder,
even if not an integral multiple of $1,000, shall be redeemed.  Except as provided in the preceding sentence,
provisions of this Indenture that apply to Notes called for redemption also
apply to portions of Notes called for redemption.

 

Section 3.3                     Notice of
Redemption

 

Subject to the provisions of Section 3.7
hereof, at least 30 days but not more than 60 days before a Redemption Date,
the Issuers shall mail or cause to be mailed, by first class mail, a notice of
redemption to each Holder whose Notes are to be redeemed at its registered
address.

 

The notice shall identify the Notes to be redeemed
(including the CUSIP number) and shall state:

 

(a)           the Redemption Date;

 

(b)           the redemption price;

 

(c)           if any Note is being
redeemed in part, the portion of the principal amount of such Note to be
redeemed and that, on or after the Redemption Date upon surrender of such Note,
a new Note or Notes in principal amount equal to the unredeemed portion shall
be issued upon cancellation of the original Note;

 

(d)           the name and address of the
Paying Agent;

 

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

 

(f)            that, unless the Issuers
default in making such redemption payment, interest on Notes called for
redemption ceases to accrue on and after the Redemption Date;

 

42

 

(g)           the paragraph of the Notes
and/or Section of this Indenture pursuant to which the Notes called for
redemption are being redeemed; and

 

(h)           that no representation is
made as to the correctness or accuracy of the CUSIP number, if any, listed in
such notice or printed on the Notes.

 

At the Issuers’ request, the Trustee shall give the
notice of redemption in the Issuers’ name and at its expense; provided, however, that
the Issuers shall have delivered to the Trustee, at least 45 days prior to the
Redemption Date (unless a shorter period shall be acceptable to the Trustee),
an Officers’ Certificate requesting that the Trustee give such notice and
setting forth the information to be stated in such notice as provided in the
preceding paragraph.

 

Section 3.4                     Effect of
Notice of Redemption

 

Once notice of redemption is mailed in accordance
with Section 3.3 hereof, Notes called for redemption become irrevocably
due and payable on the Redemption Date at the redemption price.  A notice of redemption may not be
conditional.

 

Section 3.5                     Deposit of
Redemption Price

 

On or before the Redemption Date, the Issuers shall
deposit with the Trustee or with the Paying Agent immediately available funds
sufficient to pay the redemption price of and accrued and unpaid interest on
all Notes to be redeemed on that date. 
The Trustee or the Paying Agent shall promptly return to the Issuers any
money deposited with the Trustee or the Paying Agent by the Issuers in excess
of the amounts necessary to pay the redemption price of, and accrued and unpaid
interest on, all Notes to be redeemed.

 

If the Issuers comply with the provisions of the
preceding paragraph, on and after the Redemption Date, interest shall cease to
accrue on the Notes or the portions of Notes called for redemption.  If a Note is redeemed on or after an interest
Record Date but on or prior to the related Interest Payment Date, then any
accrued and unpaid interest shall be paid to the Person in whose name such Note
was registered at the close of business on such Record Date.  If any Note called for redemption shall not
be so paid upon surrender for redemption because of the failure of the Issuers
to comply with the preceding paragraph, interest shall be paid on the unpaid
principal, from the Redemption Date until such principal is paid, and to the
extent lawful on any interest not paid on such unpaid principal, in each case
at the rate provided in the Notes and in Section 4.1 hereof.

 

Section 3.6                     Notes Redeemed
in Part

 

Upon surrender of a Note that is redeemed in part,
the Issuers shall issue and, upon receipt of an Authentication Order, the
Trustee shall authenticate for the Holder at the expense of the Issuers a new
Note equal in principal amount to the unredeemed portion of the Note
surrendered.

 

Section 3.7                     Optional
Redemption

 

(a)           Except as set forth in
clause (b) of this Section 3.7, the Issuers shall not have the option
to redeem the Notes pursuant to this Section 3.7 prior to January 15,
2009.  The Notes shall be redeemable for
cash at the option of the Issuers, in whole or in part, at any time on or after
January 15, 2009, upon not less than 30 days nor more than 60 days prior
notice mailed 

 

43

 

by first class mail to each Holder at its
last registered address, at the following redemption prices (expressed as
percentages of the principal amount) if redeemed during the 12-month period
commencing January 15 of the years indicated below, in each case (subject
to the right of Holders of record on a Record Date to receive the corresponding
interest due on the corresponding Interest Payment Date that is on or prior to
such Redemption Date) together with accrued and unpaid interest thereon to the
date of redemption of the Notes (the “Redemption Date”):

 

	
  Period

  	
   

  	
  Percentage

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  2009

  	
   

  	
  103.875

  	
  %

  
	
   

  	
   

  	
   

  	
   

  
	
  2010

  	
   

  	
  101.938

  	
  %

  
	
   

  	
   

  	
   

  	
   

  
	
  2011 and thereafter

  	
   

  	
  100.000

  	
  %

  

 

(b)           Notwithstanding the
provisions of clause (a) of this Section 3.7, at any time or from
time to time on or prior to January 15, 2008, upon the consummation of one
or more Equity Offerings for cash, up to 35% of the aggregate principal amount
of the Notes issued pursuant to this Indenture (only as necessary to avoid any
duplication, excluding any replacement Notes) may be redeemed at the Issuers’
option within 90 days of such Equity Offering, on not less than 30 days, but
not more than 60 days, notice to each Holder of the Notes to be redeemed, with
cash received by the Issuers from the Net Cash Proceeds of such Equity
Offering, at a redemption price equal to 107.750% of principal, together with
accrued and unpaid interest thereon to the Redemption Date; provided, however, that
immediately following such redemption not less than 65% of the aggregate
principal amount of the Notes originally issued pursuant to this Indenture on
the Issue Date remains outstanding (only as necessary to avoid any duplication,
excluding any replacement Notes).

 

(c)           Any redemption pursuant to
this Section 3.7 shall be made pursuant to the provisions of Sections 3.1
through 3.6 hereof.

 

Section 3.8                     No Mandatory
Redemption

 

The Issuers shall not be required to make mandatory
redemption payments with respect to the Notes (however, the Issuers are
required to offer to repurchase Notes in accordance with the provisions of
Sections 4.13 and 4.14 below).  The Notes
shall not have the benefit of any sinking fund.

 

ARTICLE IV

 

COVENANTS

 

Section 4.1                     Payment of
Notes

 

The Issuers shall pay or cause to be paid the
principal of, premium, if any, and interest on the Notes on the dates and in
the manner provided in the Notes. 
Principal, premium, if any, and interest shall be considered paid on the
date due if the Paying Agent, if other than an Issuer or a Subsidiary thereof,
holds as of 12:00 noon Eastern time on the due date money deposited by the
Issuers in immediately available funds and designated for and sufficient to pay
all principal, premium, if any, and interest then due.

 

44

 

The Issuers shall pay interest (including Accrued
Bankruptcy Interest in any proceeding under any Bankruptcy Law) on overdue
principal at the then applicable interest rate on the Notes to the extent
lawful; it shall pay interest (including Accrued Bankruptcy Interest in any
proceeding under any Bankruptcy Law) on overdue installments of interest
(without regard to any applicable grace period) at the same rate to the extent
lawful.

 

Section 4.2                     Maintenance of
Office or Agency

 

The Issuers and the Guarantors shall maintain in the
Borough of Manhattan, The City of New York, an office or agency (which may be
an office of the Trustee or an affiliate of the Trustee, Registrar or
co-registrar) where Notes may be surrendered for registration of transfer or
for exchange and where notices and demands to or upon the Issuers and the
Guarantors in respect of the Notes and this Indenture may be served.  The Issuers and the Guarantors shall give
prompt written notice to the Trustee of the location, and any change in the
location, of such office or agency.  If
at any time the Issuers and the Guarantors shall fail to maintain any such required
office or agency or shall fail to furnish the Trustee with the address thereof,
such presentations, surrenders, notices and demands may be made or served at
the Corporate Trust Office.

 

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

 

The Issuers hereby designate the Corporate Trust
Office as one such office or agency of the Issuers in accordance with Section 2.3
hereof.

 

Section 4.3                     Reports to
Holders

 

So long as any Notes are outstanding, the Issuers
shall deliver or cause to be delivered without cost to the Trustee and each
Holder:

 

(a)           within 100 days after the
end of each fiscal year of the Company:

 

(i)            audited year-end
consolidated financial statements of the Company and its subsidiaries
(including balance sheets, statements of operations, statements of cash flows
and other financial data substantially consistent in form and substance with
the financial data set forth in the Offering Circular), including complete
footnotes to such financial statements and also including a footnote showing
consolidating financial information for all non-guarantor Subsidiaries (on a
combined basis), if any, and the report of the independent auditors on the
financial statements, in each case prepared in accordance with GAAP;

 

(ii)           a management’s discussion
and analysis of financial condition and results of operations for the Company
(including a discussion of the results of operations, financial condition, and
liquidity and capital resources, and a discussion of material commitments and
contingencies and critical accounting policies) with respect to such period,
substantially consistent in form and substance with the management’s discussion
and analysis of financial condition and results of operations set forth in the
Offering Circular; and

 

45

 

(iii)          with respect to any
Significant Acquisition or Disposition consummated more than 90 days prior to
the date such information is furnished, pro forma and
historical financial statements (including balance sheets, statements of
operations, statements of cash flows and other financial data substantially
consistent, in the case of historical financial statements, in form and
substance with the financial information set forth in the Offering Circular),
including complete footnotes to such pro forma and
historical financial statements, with respect to the business or assets
constituting such Significant Acquisition or Disposition for the two most recent
fiscal years and any interim fiscal quarters; and

 

(b)           within 45 days after the end
of each of the first three fiscal quarters of each fiscal year of the Company:

 

(i)            unaudited quarterly
consolidated financial statements of the Company and its subsidiaries
(including balance sheets, statements of operations, statements of cash flows
and other financial data substantially consistent in form and substance with
the financial data set forth in the Offering Circular), including complete
footnotes to such financial statements and also including a footnote showing
consolidating financial information for all non-guarantor Subsidiaries (on a
combined basis), if any, and the report of the independent auditors on the
financial statements (if required by the SEC or the Public Company Accounting
Oversight Board with respect to interim financial statements filed by companies
subject to the reporting requirements of the Exchange Act as if the Company
were so subject), in each case prepared in accordance with GAAP, and with a
review of such financial statements having been conducted by the Company’s
independent auditors in accordance with Statement of Auditing Standards 100, or
any similar successor provision;

 

(ii)           a management’s discussion
and analysis of financial condition and results of operations for the Company
(including a discussion of the results of operations, financial condition, and
liquidity and capital resources, and a discussion of material commitments and
contingencies and critical accounting policies) with respect to such period,
substantially consistent in form and substance with the management’s discussion
and analysis of financial condition and results of operations set forth in the
Offering Circular; and

 

(iii)          with respect to any
Significant Acquisition or Disposition consummated more than 90 days prior to
the date such information is furnished, pro forma and
historical financial statements (including balance sheets, statements of
operations, statements of cash flows and other financial data substantially
consistent, in the case of historical financial statements, in form and
substance with the financial information set forth in the Offering Circular),
including complete footnotes to such pro forma and
historical financial statements, with respect to the business or assets
constituting such Significant Acquisition or Disposition for the two most
recent fiscal years and any interim fiscal quarters.

 

The Company (and the management of Parent) shall use
their best efforts to participate in quarterly conference calls to discuss
results of operations with Holders.  In
addition, for so long as any Notes remain outstanding, Holders and prospective
purchasers that are “qualified institutional buyers” (as that term is defined
in Rule 144A under the Securities Act) shall have the right to obtain from
the Issuers, upon request, the information required to be delivered pursuant to
Rule 144A(d)(4) under the Securities Act.

 

Section 4.4                     Compliance
Certificate

 

46

 

(a)                                  The Issuers
shall deliver to the Trustee, within 120 days after the end of each fiscal
year, an Officers’ Certificate signed by the principal financial officer, the
principal executive officer or principal accounting officer stating that a
review of the activities of the Issuers and their Subsidiaries during the
preceding fiscal year has been made under the supervision of the signing
Officers with a view to determining whether the Issuers and their Subsidiaries
have kept, observed, performed and fulfilled their obligations under this
Indenture, and further stating, as to each such Officer signing such
certificate, that to his or her knowledge the Issuers and their Subsidiaries
are not in default in the performance or observance of any of the terms, provisions
and conditions of this Indenture (or, if a Default or Event of Default shall
have occurred and be continuing, describing all such Defaults or Events of
Default of which he or she may have knowledge and what action the Issuers are
taking or propose to take with respect thereto) and that to his or her
knowledge no event has occurred and remains in existence by reason of which
payments on account of the principal of or interest, if any, on the Notes is
prohibited or if such event has occurred, a description of the event and what
action the Issuers are taking or propose to take with respect thereto.  The Issuers shall provide the Trustee with
timely written notice of any change in their fiscal year ends.

 

(b)                                 The Issuers
shall, so long as any of the Notes are outstanding, deliver to the Trustee,
within five Business Days of any Officer becoming aware of any Default or Event
of Default, an Officers’ Certificate specifying such Default or Event of
Default and what action the Issuers are taking or propose to take with respect
thereto.

 

Section 4.5                                                              Taxes

 

The Issuers shall pay, and shall cause each of their
Subsidiaries to pay, prior to delinquency, all material taxes, assessments, and
governmental levies except such as are contested in good faith and by appropriate
proceedings or where the failure to effect such payment would not have a
material adverse effect on the ability of the Issuers and the Guarantors to
satisfy their obligations under the Notes, the Guarantees and this Indenture.

 

Section 4.6                                                              Stay, Extension
and Usury Laws

 

Each Issuer covenants (to the extent that it may
lawfully do so) that it shall not at any time insist upon, plead, or in any
manner whatsoever claim or take the benefit or advantage of, any stay,
extension or usury law wherever enacted, now or at any time hereafter in force,
that may affect the covenants or the performance of this Indenture; and each
Issuer (to the extent that it may lawfully do so) hereby expressly waives all
benefit or advantage of any such law, and covenants that it shall not, by
resort to any such law, hinder, delay or impede the execution of any power
herein granted to the Trustee, but shall suffer and permit the execution of
every such power as though no such law has been enacted.

 

Section 4.7                                                              Limitation on
Incurrence of Additional Indebtedness and Disqualified Capital Stock

 

Except as set forth in this Section 4.7,

 

(a)                                  the Issuers
shall not and the Subsidiary Guarantors shall not, and neither the Issuers nor
the Subsidiary Guarantors shall permit any of the Subsidiaries to, directly or
indirectly, issue, assume, guaranty, incur, become directly or indirectly
liable with respect to (including as a result of an Acquisition), or otherwise
become responsible for, contingently or otherwise (individually and collectively,
to “incur” or, as appropriate, an “incurrence”), any 

 

47

 

Indebtedness (including Disqualified Capital
Stock and Acquired Indebtedness), other than Permitted Indebtedness.

 

Notwithstanding the foregoing if:

 

(1)                                  no Default or
Event of Default shall have occurred and be continuing at the time of, or would
occur after giving effect on a pro forma
basis to, such incurrence of Indebtedness and the use of such proceeds thereof,
and

 

(2)                                  on the date of
such incurrence (the “Incurrence Date”), the Consolidated Coverage Ratio of the
Company for the Reference Period immediately preceding the Incurrence Date,
after giving effect on a pro forma
basis to such incurrence of such Indebtedness and the use of proceeds thereof,
would be at least 2.0 to 1.0 (the “Debt Incurrence Ratio”),

 

then the Issuers and the Subsidiary
Guarantors may incur such Indebtedness (including Disqualified Capital Stock).

 

(b)                                 The foregoing
limitations of Section 4.7(a) hereof shall not prohibit:

 

(1)                                  the incurrence
by an Issuer or any Subsidiary Guarantor of Purchase Money Indebtedness; provided, that

 

(i)                                     the aggregate amount of such
Indebtedness incurred and outstanding at any time pursuant to this Section 4.7(b)(1) (plus
any Refinancing Indebtedness issued to retire, defease, refinance, replace or
refund such Indebtedness) shall not exceed $10.0 million, and

 

(ii)                                  in each case, such
Indebtedness shall not constitute more than 100% of the Issuers’ cost or the
cost to such Subsidiary Guarantor, (determined in accordance with GAAP), as
applicable, of the property so purchased, constructed, improved or leased;

 

(2)                                  the incurrence
by an Issuer or any Subsidiary Guarantor of Indebtedness in an aggregate amount
incurred and outstanding at any time pursuant to this Section 4.7(b)(2) (plus
any Refinancing Indebtedness incurred to retire, defease, refinance, replace or
refund such Indebtedness) of up to $20.0 million;

 

(3)                                  the incurrence
by an Issuer or any Subsidiary Guarantor of Indebtedness pursuant to the Credit
Agreement in an aggregate amount incurred and outstanding at any time pursuant
to this Section 4.7(b)(3) (plus any Refinancing Indebtedness incurred
to retire, defease, refinance, replace or refund such Indebtedness) of up to
$105.0 million, minus the amount of any such Indebtedness (A) retired with
the Net Cash Proceeds from any Asset Sale applied to permanently reduce the
outstanding amounts or the commitments with respect to such Indebtedness
pursuant to Section 4.13 hereof or (B) assumed by a transferee in an
Asset Sale;

 

(4)                                  the incurrence
by an Issuer or any Subsidiary Guarantor of Attributable Indebtedness incurred
in connection with any sale and leaseback transaction in an aggregate amount
incurred and outstanding at any time pursuant to this Section 4.7(b)(4) (plus
any Refinancing Indebtedness issued to retire, 

 

48

 

defease, refinance, replace or refund such
Attributable Indebtedness) of up to $15.0 million; and

 

(5)                                  the incurrence
by any Foreign Subsidiary of Indebtedness in an aggregate principal amount
incurred and outstanding at any time pursuant to this Section 4.7(b)(5) (plus
any Refinancing Indebtedness incurred to refinance, retire, defease, refund or
otherwise replace any such Indebtedness) of up to $7.5 million (or the
equivalent thereof, at the time of incurrence, in the applicable foreign
currency).

 

Indebtedness (including Disqualified Capital Stock)
of any Person which is outstanding at the time such Person becomes a Subsidiary
(including upon designation of any subsidiary or other Person as a Subsidiary)
or is merged with or into or consolidated with an Issuer or any Subsidiary
shall be deemed to have been incurred at the time such Person becomes or is
designated a Subsidiary or is merged with or into or consolidated with an
Issuer or any Subsidiary, as applicable.

 

Notwithstanding any other provision of this Section 4.7,
but only to avoid duplication, a guarantee of Indebtedness of an Issuer or a
Subsidiary Guarantor incurred in accordance with the terms of this Indenture
issued at the time such Indebtedness was incurred or, if later, at the time the
guarantor thereof became one of the Subsidiaries shall not constitute a
separate incurrence, or amount outstanding, of Indebtedness.  For purposes of determining compliance with
this Section 4.7, in the event that an item of Indebtedness meets the
criteria of more than one of the categories described in Sections 4.7(b)(1) —
(5) hereof, or is entitled to be incurred pursuant to Section 4.7(a) hereof,
the Company shall, in its sole discretion, be permitted to classify (or later
classify or reclassify in whole or in part) such item of Indebtedness or any
portion thereof in any manner that complies with this Section 4.7.

 

For purposes of determining compliance with this Section 4.7,
the accrual of interest; the accretion or amortization of original issue
discount; the payment of interest on any Indebtedness incurred in accordance
with the terms of this Indenture in the form of additional Indebtedness with
the same or less onerous terms than such Indebtedness in respect of which the
payment of interest is being made; the payment of dividends on Disqualified
Capital Stock in the form of additional shares of the same class of
Disqualified Capital Stock; the accrual of dividends on Disqualified Capital
Stock; and the accretion of the liquidation preference of Disqualified Capital
Stock will not be deemed to be an incurrence of Indebtedness or an issuance of
Disqualified Capital Stock for purposes of this Section 4.7.  The foregoing shall not affect the definition
of Consolidated Fixed Charges.

 

Section 4.8                                                              Limitation on
Liens

 

The Issuers shall not and the Subsidiary Guarantors
shall not, and none of the Issuers nor the Subsidiary Guarantors shall permit
any of the Subsidiaries to, create, incur, assume or suffer to exist any Lien
of any kind, other than Permitted Liens, upon any of their respective assets
now owned or acquired on or after the date of this Indenture or upon any income
or profits therefrom.

 

Section 4.9                                                              Limitation on
Restricted Payments

 

(a)                                  The Issuers
shall not and the Subsidiary Guarantors shall not, and neither the Issuers nor
the Subsidiary Guarantors shall permit any of the Subsidiaries to, directly or 

 

49

 

indirectly, make any Restricted Payment if,
after giving effect to such Restricted Payment on a pro forma
basis:

 

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

 

(2)                                  the Issuers are
not permitted to incur at least $1.00 of additional Indebtedness pursuant to
the Debt Incurrence Ratio in Section 4.7 hereof;

 

(3)                                  the aggregate
amount of all Restricted Payments made by the Issuers and the Issuers’
Subsidiaries, including after giving effect to such proposed Restricted
Payment, on and after the Issue Date, would exceed, without duplication, the
sum of:

 

(A)                              an amount equal
to the difference (but not less than zero) between (i) Cumulative
Operating EBITDA and (ii) the product of 2.0 multiplied by Cumulative
Total Interest Expense, plus

 

(B)                                100% of the
aggregate Net Cash Proceeds received by the Company from a Capital Contribution
or from the sale of its Qualified Capital Stock (other than (i) to one of
the Issuers’ Subsidiaries and (ii) to the extent applied in connection
with a Qualified Exchange or a Permitted Investment pursuant to clause (e) of
the definition of “Permitted Investment” hereof or, to avoid duplication,
otherwise given credit for in any provision of Section 4.9(b) hereof)
after the Issue Date, plus

 

(C)                                except in each
case, in order to avoid duplication, to the extent any such payment or proceeds
have been included in the calculation of Consolidated Net Income, an amount
equal to the net reduction in Investments (other than returns of or from
Permitted Investments) in any Person resulting from cash distributions on or
cash repayments of any Investments, including payments of interest on
Indebtedness, dividends, repayments of loans or advances, or other
distributions or other transfers of assets, in each case to an Issuer or any
Subsidiary or from the Net Cash Proceeds from the sale of any such Investment
or from redesignations of Unrestricted Subsidiaries as Subsidiaries (valued in
each case as provided in the definition of “Investments”), not to exceed, in
each case, the amount of Investments previously made by an Issuer or any
Subsidiary in such Person, including, if applicable, such Unrestricted
Subsidiary, less the cost of disposition, or

 

(4)                                  the
Consolidated Net Debt to EBITDA Ratio of the Company for the Reference Period
immediately preceding the proposed Restricted Payment, after giving effect on a
pro forma basis to such proposed
Restricted Payment and all other Restricted Payments made pursuant to this Section 4.9(a) since
the end of such Reference Period, would be greater than 5.0 to 1.0;

 

provided, that any
Restricted Payment made in accordance with this Section 4.9(a) may be
made only during the following two 30-day periods in each fiscal year:  (x) the 30-day period beginning on the
date that the Issuers deliver financial statements to Holders as provided under
Section 4.3 of this Indenture for the fiscal period ended March 31; provided, that the applicable Reference Period for
determining whether any Restricted Payment may be made during such period
pursuant to this paragraph shall end on such March 31; and (y) the
30-day period 

 

50

 

beginning on the date that the Issuers
deliver financial statements to Holders as provided under Section 4.3 of
this Indenture for the fiscal period ended September 30; provided, that the applicable Reference Period for
determining whether any Restricted Payment may be made during such period
pursuant to this paragraph shall end on such September 30.

 

(b)                                 Section 4.9(a)(2),
(3) and (4) above, however, shall not prohibit:

 

(1)                                  payments to
Parent to permit Parent, and which are used by Parent concurrently therewith,
to repurchase Equity Interests of Parent, or payments to repurchase Equity
Interests of Parent directly, or payments to repurchase Equity Interests of the
Company, in each of the foregoing cases, from current or former officers,
employees, directors or consultants (or their heirs or estates) of Parent, an
Issuer or any Subsidiary upon the death, disability or termination of
employment of such Person or within six months of the occurrence of any of the
foregoing, in an aggregate amount to all such officers, employees, directors or
consultants (or their heirs or estates) not to exceed $1.0 million per year,
plus the unutilized portion thereof from the immediately preceding year, or
$5.0 million in the aggregate on and after the Issue Date, and;

 

(2)                                  Restricted
Payments made pursuant to this clause (2) not to exceed $5.0 million in
the aggregate from and after the Issue Date,

 

and Section 4.9(a) (1), (2), (3) and
(4) will not prohibit:

 

(3)                                  any dividend,
distribution or other payments by any Subsidiary on its Equity Interests that
is paid pro rata to all holders
of such Equity Interests;

 

(4)                                  a Qualified
Exchange;

 

(5)                                  the payment of
any dividend on any Equity Interests within 60 days after the date of its
declaration if such dividend could have been made on the date of such
declaration in compliance with the foregoing provisions;

 

(6)                                  Permitted
Payments to Parent; or

 

(7)                                  payments to
Parent on or about the Issue Date to permit Parent, and which are used by
Parent substantially concurrently therewith, to redeem preferred stock of
Parent held by its stockholders on the Issue Date and to pay bonus amounts to
certain executives of Parent, in each case in the amounts and on the terms
described in the Offering Circular, including under “Use of Proceeds” and “Certain
Relationships and Related Party Transactions.”

 

The full amount of any Restricted Payment made
pursuant to Sections 4.9(b)(1), (2), (3) and (5) (but not pursuant to
clauses (4), (6) and (7) of Section 4.9(b), however), shall be
counted as Restricted Payments made for purposes of the calculation of the
aggregate amount of Restricted Payments available to be made referred to in Section 4.9(a)(3) hereof.

 

(c)                                  For purposes of
this Section 4.9, the amount of any Restricted Payment made or returned,
if other than in cash, shall be the fair market value thereof, as determined in
the good faith reasonable judgment of the Board of Directors for Restricted
Payments with a value in 

 

51

 

excess of $1.0 million, and otherwise by an
executive officer of the Company, unless stated otherwise, at the time made or
returned, as applicable.

 

Section 4.10                                                        Limitation on
Dividends and Other Payment Restrictions Affecting Subsidiaries

 

The Issuers shall not and the Subsidiary Guarantors
shall not, and none of the Issuers or the Subsidiary Guarantors shall permit
any of the Subsidiaries to, directly or indirectly, create, assume or suffer to
exist any consensual restriction on the ability of any of the Subsidiaries to
pay dividends or make other distributions to or on behalf of, or to pay any
obligation to or on behalf of, or otherwise to transfer assets or property to
or on behalf of, or make or pay loans or advances to or on behalf of, the
Issuers or any Subsidiary, except:

 

(1)                                  restrictions
imposed by the Notes or this Indenture;

 

(2)                                  restrictions
imposed by applicable law;

 

(3)                                  existing
restrictions under Existing Indebtedness as of the Issue Date, and any
amendments, modifications, restatements, renewals, increases, supplements,
refundings, replacements or refinancings of Existing Indebtedness; provided, that the amendments, modifications,
restatements, renewals, increases, supplements, refundings, replacements or
refinancings are not more restrictive, taken as a whole, with respect to such
dividend and other payment restrictions than those contained in the Existing
Indebtedness on the Issue Date;

 

(4)                                  restrictions
under any Acquired Indebtedness not incurred in violation of this Indenture or
any agreement (including any Equity Interest) relating to any property, asset,
or business acquired by an Issuer or any of the Subsidiaries, which
restrictions in each case existed at the time of acquisition, were not put in
place in connection with or in anticipation of such acquisition and are not
applicable to any Person, other than the Person acquired, or to any property,
asset or business, other than the property, assets and business so acquired;

 

(5)                                  restrictions
imposed by Indebtedness incurred under the Credit Agreement; provided, that such restrictions are no
more restrictive taken as a whole than those imposed by the Credit Agreement as
in effect on the Issue Date;

 

(6)                                  restrictions
imposed pursuant to a binding agreement which has been entered into for the
sale or disposition of Equity Interests or assets of such Subsidiary; provided, that such restrictions apply
solely to the Equity Interests or assets of such Subsidiary which are being
sold;

 

(7)                                  restrictions on
transfer contained in Purchase Money Indebtedness incurred pursuant to Section 4.7(b)(1);
provided, that such restrictions
relate only to the transfer of the property purchased, constructed, improved or
leased with the proceeds of such Purchase Money Indebtedness;

 

(8)                                  in connection
with and pursuant to permitted Refinancings, replacements of restrictions
imposed pursuant to clauses (1), (3), (4) or (7) or this clause (8) of
this paragraph that are not more restrictive taken as a whole than 

 

52

 

those being replaced and do not apply to any
other Person or assets than those that would have been covered by the
restrictions in the Indebtedness so refinanced; and

 

(9)                                  restrictions
contained in Indebtedness incurred by a Foreign Subsidiary in accordance with
clause 4.7(b)(5); provided, that
such restrictions relate only to one or more Foreign Subsidiaries.

 

Notwithstanding the foregoing, (a) customary
provisions restricting subletting or assignment of any lease, license or other
contract entered into in the ordinary course of business, shall be permitted
with respect to such lease, license or other contract and (b) any asset
subject to a Lien which is not prohibited to exist with respect to such asset
pursuant to the terms of this Indenture may be subject to customary
restrictions on the transfer or disposition thereof pursuant to such Lien.

 

Section 4.11                                                        Limitation on
Lines of Business

 

Neither the Company nor any of its Subsidiaries
shall directly or indirectly engage to any substantial extent in any line or
lines of business activity other than that which, in the reasonable good faith
judgment of its Board of Directors, is a Related Business.

 

The Finance Company shall exist solely to operate as
a co-issuer of debt securities of the Company to facilitate offerings of such
securities and shall not have any operations or assets and shall not have any
revenue, other than as necessary or incidental to facilitate such offerings; provided, that the foregoing shall not apply in the event of
a merger or consolidation of the Company with and into the Finance Company as
provided under Section 5.1 of this Indenture.

 

Section 4.12                                                        Limitation on Transactions
with Affiliates

 

On or after the Issue Date, the Issuers shall not,
and shall not permit any of the Subsidiaries to, in one transaction or a series
of related transactions, enter into any contract, agreement, arrangement or
transaction or any amendment to any of the foregoing, with any Affiliate (each
of the foregoing, an “Affiliate Transaction”) (other than Exempted Affiliate
Transactions), unless (1) the terms of such Affiliate Transaction are fair
and reasonable to such Issuer or such Subsidiary, and no less favorable to such
Issuer or such Subsidiary than could have been obtained in an arm’s length
transaction with a non-Affiliate, and (2) if such Affiliate Transaction
involves aggregate consideration to either party in excess of $1.0 million,
such Affiliate Transaction(s) has been approved by a majority of the
members of the Board of Directors that are disinterested in such transaction,
if there are any directors who are so disinterested, and (3) if such
Affiliate Transaction involves aggregate consideration to either party in
excess of $5.0 million, or $1.0 million if there are no disinterested directors
for such transaction, in addition the Issuers, prior to the consummation
thereof, obtain a written favorable opinion as to the fairness of such
transaction to the Issuers from a financial point of view from an independent
investment banking firm of national reputation in the United States or, if
pertaining to a matter for which such investment banking firms do not
customarily render such opinions, an appraisal or valuation firm of national
reputation in the United States.  Within
10 Business Days after consummation of any Affiliate Transaction(s) (other
than an Exempted Affiliate Transaction) involving consideration to either party
of $1.0 million or more, the Issuers shall deliver to the Trustee an Officers’
Certificate addressed to the Trustee certifying that such Affiliate Transaction
(or Transactions) complied with clause (1), (2), and (3), as applicable.

 

53

 

Section 4.13                                                        Limitation on
Sale Of Assets And Subsidiary Stock

 

(a)                                  The Issuers
shall not and the Subsidiary Guarantors shall not, and neither the Issuers nor
the Subsidiary Guarantors shall permit any of the Subsidiaries to, in one or a
series of related transactions, convey, sell, transfer, assign or otherwise
dispose of, directly or indirectly, any of their property, business or assets,
including by merger or consolidation (in the case of the Subsidiaries), and
including any sale or other transfer or issuance of any Equity Interests of any
of the Subsidiaries, whether by an Issuer or any of the Subsidiaries or through
the issuance, sale or transfer of Equity Interests by one of the Subsidiaries
and including any sale and leaseback transaction (any of the foregoing, an “Asset
Sale”), unless:

 

(1)                                  at least 75% of
the total consideration for such Asset Sale or series of related Asset Sales
consists of cash or Cash Equivalents, and

 

(2)                                  such Issuer or
such Subsidiary receives, as applicable, fair market value for such Asset Sale,
which fair market determination shall be made by a resolution of the Board of
Directors if the value of such Asset Sale is more than $2.5 million.

 

For purposes of clause (1) above, total
consideration received means the total consideration received for such Asset
Sales, minus the amount of (a) Purchase Money Indebtedness secured solely
by the assets sold and assumed by a transferee; provided,
that the Issuers are and the Subsidiaries are fully released from all obligations
in connection therewith, (b) any of such Issuer’s or such Subsidiary’s
liabilities, as shown on such Issuer’s or such Subsidiary’s most recent balance
sheet (other than contingent liabilities and liabilities that are by their
terms subordinated to the Notes or any Guarantee) that are assumed by the
transferee of any such assets; provided, that
the Issuers are and the Subsidiaries are fully released from all obligations in
connection therewith, (c) property that within 30 days of such Asset Sale
is converted into cash or Cash Equivalents; provided, that
such cash and Cash Equivalents shall be treated as Net Cash Proceeds
attributable to the original Asset Sale for which such property was received,
and (d) the fair market value of property received as consideration for
such Asset Sale that would otherwise constitute a permitted application of Net
Cash Proceeds (or other cash in such amount) under clause (b)(1)(A) below
(such fair market value to be made as provided in clause (2) above).

 

(b)                                 Within 360 days
following such Asset Sale or the receipt of such Net Cash Proceeds, an amount
equal to the Net Cash Proceeds therefrom (the “Asset Sale Amount”) shall be:

 

(1)                                  (A) invested
in Additional Assets or (B) used to make Permitted Investments other than
those under clauses (a), (b) or (c) under the definition of “Permitted
Investments” hereof, which in the good faith reasonable judgment of the Board
of Directors shall immediately constitute or be a part of a Related Business
immediately following such transaction; or

 

(2)                                  used to retire (i) Purchase
Money Indebtedness secured by the asset which was the subject of the Asset
Sale, (ii) Indebtedness outstanding under the Credit Agreement and to
permanently reduce the amount of such Indebtedness permitted to be incurred
pursuant to Section 4.7(b)(3) hereof (including that in the case of a
revolver or similar arrangement that makes credit available, such commitment is
so permanently reduced by such amount), or (iii) other Indebtedness
incurred in accordance with Section 4.7 and secured by a Lien

 

54

 

permitted under clause (o) of the
definition of “Permitted Liens”; provided, that
the amount of Indebtedness repaid with such Net Cash Proceeds pursuant to this
clause (iii) shall not exceed the value of the assets securing such
Indebtedness repaid, or

 

(3)                                  applied to the
optional redemption of the Notes in accordance with the terms of this Indenture
and the Issuers’ other Indebtedness ranking on a parity with the Notes and with
similar provisions requiring the Issuers to redeem such Indebtedness with the
proceeds from such Asset Sale, pro rata
in proportion to the respective principal amounts (or accreted values in the
case of Indebtedness issued with an original issue discount) of the Notes and
such other Indebtedness then outstanding,

 

except that, in the case of each of the
provisions of clauses (1) and (2), only proceeds from an Asset Sale of
assets or Equity Interests of a Foreign Subsidiary may be invested in or used
to retire Indebtedness of a Foreign Subsidiary. 
Pending the final application of any Net Cash Proceeds, the Issuers may
temporarily reduce revolving credit borrowings or otherwise use the Net Cash
Proceeds in any manner that is not prohibited by this Indenture.

 

(c)                                  The accumulated
Net Cash Proceeds from Asset Sales not applied as set forth in Sections
4.13(b)(1), (2) or (3) hereof shall constitute “Excess Proceeds”.  Within 30 days after the date that the amount
of Excess Proceeds exceeds $5,000,000, which date shall not be prior to 390
days subsequent to the Asset Sale that generated such Excess Proceeds, the
Issuers shall apply an amount equal to the Excess Proceeds (the “Asset Sale
Offer Amount”) to the repurchase of the Notes and such other Indebtedness ranking
on a parity with the Notes and with similar provisions requiring the Issuers to
make an offer to purchase such Indebtedness with the proceeds from such Asset
Sale pursuant to a cash offer (subject only to conditions required by
applicable law, if any) (pro rata in
proportion to the respective principal amounts (or accreted values in the case
of Indebtedness issued with an original issue discount) of the Notes and such
other Indebtedness then outstanding) (the “Asset Sale Offer”) at a purchase
price of 100% of the principal amount (or accreted value in the case of
Indebtedness issued with an original issue discount) (the “Asset Sale Offer
Price”) together with accrued and unpaid interest to the date of payment.  Each Asset Sale Offer shall remain open for
20 Business Days following its commencement (the “Asset Sale Offer Period”).

 

(d)                                 Upon expiration
of the Asset Sale Offer Period, the Issuers shall apply the Asset Sale Offer
Amount plus an amount equal to accrued and unpaid interest to the purchase of all
Indebtedness properly tendered in accordance with the provisions hereof (on a pro rata basis if the Asset Sale Offer Amount is
insufficient to purchase all Indebtedness so tendered) at the Asset Sale Offer
Price (together with accrued interest). 
To the extent that the aggregate amount of Notes and such other pari passu Indebtedness tendered pursuant to an Asset Sale
Offer is less than the Asset Sale Offer Amount, the Issuers may use any
remaining Net Cash Proceeds in any manner not otherwise prohibited by this
Indenture and following the consummation of each Asset Sale Offer the Excess
Proceeds amount shall be reset to zero.

 

(e)                                  Notwithstanding,
and without complying with, the foregoing provisions of this Section 4.13:

 

(1)                                  the Issuers may
and the Subsidiaries may, in the ordinary course of business, (a) convey,
sell, transfer, assign or otherwise dispose of inventory and other assets and (b) liquidate
Cash Equivalents;

 

55

 

(2)                                  the Issuers may
and the Subsidiaries may convey, sell, transfer, assign or otherwise dispose of
assets pursuant to and in accordance with Section 5.1 hereof;

 

(3)                                  the Issuers may
and the Subsidiaries may sell or dispose of damaged, worn out, or obsolete
property in the ordinary course of business, which property is no longer used
or useful in the Issuers’ business or the business of such Subsidiary, as
applicable;

 

(4)                                  the Issuers may
and the Subsidiaries may convey, sell, transfer, assign or otherwise dispose of
assets to the Issuers or any Subsidiary Guarantor;

 

(5)                                  the Issuers may
and the Subsidiaries may, in any single transaction or series of related
transactions, convey, sell, transfer, assign, or otherwise dispose of assets
with a fair market value of less than $1,000,000;

 

(6)                                  the Issuers may
and the Subsidiaries may surrender or waive contract rights or settle, release
or surrender contract, tort or other litigation claims in the ordinary course
of business or grant Liens (and permit foreclosure thereon) not prohibited by
this Indenture;

 

(7)                                  the
Subsidiaries may issue Equity Interests to the Company or to any Subsidiary
Guarantor;

 

(8)                                  Foreign
Subsidiaries may convey, sell, transfer, assign or otherwise dispose of assets
to any other Foreign Subsidiary; and

 

(9)                                  the Issuers may
and the Subsidiaries may make Restricted Payments and Permitted Investments
that are not prohibited by Section 4.9 hereof.

 

(f)                                    All Net Cash
Proceeds from an Event of Loss shall be reinvested or used as otherwise
provided above in clauses (b)(1), (2), or (3) above.

 

(g)                                 Any Asset Sale
Offer shall be made in compliance with all applicable laws, rules, and
regulations, including, if applicable, Regulation 14E of the Exchange Act and
the rules and regulations thereunder and all other applicable Federal and
state securities laws.  To the extent
that the provisions of any securities laws or regulations conflict with the
provisions of this Section 4.13, the Issuers’ compliance or the compliance
of any of the Subsidiaries with such laws and regulations shall not in and of
itself cause a breach of the Issuers’ obligations under this Section 4.13.

 

(h)                                 If the payment
date in connection with an Asset Sale Offer hereunder is on or after an
interest payment Record Date and on or before the associated Interest Payment
Date, any accrued and unpaid interest shall be paid to the Person in whose name
a Note is registered at the close of business on such Record Date.

 

Section 4.14                                                        Repurchase of
Notes at the Option of the Holder Upon a Change of Control

 

In the event that a Change of Control has occurred,
each Holder of Notes shall have the right, as described below, at such Holder’s
option, pursuant to an offer (which offer shall 

 

56

 

be subject only to
conditions required by applicable law, if any) by the Issuers (the “Change of
Control Offer”), to require the Issuers to repurchase all or any part of such
Holder’s Notes (provided, that the principal
amount of such Notes must be $1,000 or an integral multiple thereof) on a date
(the “Change of Control Purchase Date”) that is no later than 60 days after the
occurrence of such Change of Control, at a cash price equal to 101% of the
principal amount thereof (the “Change of Control Purchase Price”), together
with accrued and unpaid interest to the Change of Control Purchase Date.

 

The Change of Control Offer shall be made within 30
days following a Change of Control and shall remain open for 20 Business Days
following its commencement (the “Change of Control Offer Period”).  Upon expiration of the Change of Control
Offer Period, the Issuers shall purchase all Notes properly tendered in
response to the Change of Control Offer.

 

Notwithstanding the foregoing, the Issuers shall not
be required to make a Change of Control Offer upon a Change of Control if a
third party makes the Change of Control Offer in the manner, at the times and
otherwise in compliance with the requirements set forth in this Indenture
applicable to a Change of Control Offer made by the Issuers, and purchases all
Notes validly tendered and not withdrawn under such Change of Control Offer.

 

Prior to the commencement of a Change of Control
Offer and as a condition thereof, but in any event within 30 days following any
Change of Control, the Issuers shall obtain any requisite consents under the
Credit Agreement to permit the repurchase of the Notes pursuant to the Change
of Control Offer.  The Issuers’ failure
to comply with the preceding sentence shall constitute an Event of Default
described in clause (3) under Section 6.1 hereof.

 

On or before the Change of Control Purchase Date,
the Issuers shall:

 

(1)                                  accept for payment Notes or
portions thereof properly tendered pursuant to the Change of Control Offer;

 

(2)                                  deposit with the Paying
Agent cash sufficient to pay the Change of Control Purchase Price (together
with accrued and unpaid interest) of all Notes or portions thereof so tendered;
and

 

(3)                                  deliver to the Trustee the
Notes so accepted together with an Officers’ Certificate listing the Notes or
portions thereof being purchased by the Issuers.

 

The Paying Agent promptly shall pay the Holders of
Notes so accepted an amount equal to the Change of Control Purchase Price
(together with accrued and unpaid interest) and the Trustee promptly shall
authenticate and deliver to such Holders a new Note equal in principal amount
to any unpurchased portion of the Note surrendered.  Any Notes not so accepted shall be delivered
promptly by the Issuers to the Holder thereof. 
The Issuers publicly shall announce the results of the Change of Control
Offer on or as soon as practicable after the Change of Control Purchase Date.

 

Any Change of Control Offer shall be made in
compliance with all applicable laws, rules and regulations, including, if
applicable, Regulation 14E under the Exchange Act and the rules thereunder
and all other applicable Federal and state securities laws.  To the extent that the provisions of any
securities laws or regulations conflict with the provisions of this Section 4.14,
the Issuers’ compliance or compliance by Parent or any of the Subsidiary
Guarantors with 

 

57

 

such laws and regulations
shall not in and of itself cause a breach of their obligations under this Section 4.14.

 

If the Change of Control Purchase Date hereunder is
on or after an interest payment Record Date and on or before the associated
Interest Payment Date, any accrued and unpaid interest due on such Interest
Payment Date shall be paid to the Person in whose name a Note is registered at
the close of business on such Record Date.

 

Section 4.15                                                        Subsidiary
Guarantors

 

All of the Issuers’ respective Subsidiaries (other
than Foreign Subsidiaries) jointly and severally shall guarantee all principal,
premium, if any, and interest on the Notes on a senior basis (except that the
Finance Company will not be required to become a Subsidiary Guarantor so long
as it remains a co-issuer of the Notes).

 

Notwithstanding anything in this Indenture to the
contrary, if any Subsidiary of an Issuer (including a Foreign Subsidiary) that
is not a Subsidiary Guarantor guarantees any other Indebtedness of an Issuer or
any other Indebtedness of Parent, any Subsidiary or any Subsidiary of Parent,
or an Issuer, or Parent or any of the Subsidiaries or Parent’s Subsidiaries,
individually or collectively, pledges more than 65% of the Voting Equity
Interests of a Subsidiary (including a Foreign Subsidiary) that is not a
Subsidiary Guarantor to a lender to secure Indebtedness of an Issuer or any
Indebtedness of Parent, any Subsidiary Guarantor, or any Subsidiary of Parent,
then such Subsidiary must become a Subsidiary Guarantor.

 

Section 4.16                                                        Limitation On
Status As Investment Company

 

The Issuers and the Subsidiaries shall be prohibited
from being required to register as an “investment company” (as that term is
defined in the Investment Company Act), or from otherwise becoming subject to
regulation under the Investment Company Act.

 

Section 4.17                                                        Maintenance of
Properties

 

The Issuers and the Subsidiary Guarantors shall
cause all material properties used or useful to the conduct of their business
and the business of each of their Subsidiaries to be maintained and kept in
good condition, repair and working order (reasonable wear and tear excepted)
and supplied with all necessary equipment and shall cause to be made all
necessary repairs, renewals, replacements, betterments and improvements
thereof, all as in their reasonable judgment may be necessary, so that the
business carried on in connection therewith may be properly conducted at all
times; provided, however,
that nothing in this Section 4.17 shall prevent the Issuers or any
Subsidiary Guarantor from discontinuing any operation or maintenance of any of
such properties, or disposing of any of them, if such discontinuance or
disposal is (a) (i) in the judgment of the Issuers, desirable in the
conduct of the business of such entity and (ii) would not have a material
adverse effect on the ability of the Issuers and the Subsidiary Guarantors to
satisfy their obligations under the Notes, the Guarantees and this Indenture,
and, to the extent applicable, (b) as otherwise permitted under Section 4.13
hereof.

 

Section 4.18                                                        Corporate
Existence

 

Subject to Section 4.13 hereof and Article V
hereof, the Issuers shall do or cause to be done all things necessary to
preserve and keep in full force and effect (i) their corporate or other
existence, and the corporate, partnership or other existence of each of the
Subsidiaries, in 

 

58

 

accordance with the
respective organizational documents (as the same may be amended from time to
time) of the Issuers or any such Subsidiary and (ii) the rights (charter
and statutory), licenses and franchises of the Issuers and their Subsidiaries; provided, however, that
the Issuers shall not be required to preserve any such right, license or
franchise, or the corporate, partnership or other existence of any of their
Subsidiaries, if the Board of Directors shall determine that the preservation
thereof is no longer desirable in the conduct of the business of the Issuers
and the Subsidiaries, taken as a whole, and that the loss thereof would not
have a material adverse effect on the ability of the Issuers and the Subsidiary
Guarantors to satisfy their obligations under the Notes, the Guarantees and
this Indenture.

 

ARTICLE V

 

SUCCESSORS

 

Section 5.1                                                              Merger,
Consolidation or Sale of Assets

 

Neither Issuer shall consolidate with or merge with
or into another Person or, directly or indirectly, sell, lease, convey or
transfer all or substantially all of its assets (such amounts to be computed on
a consolidated basis), whether in a single transaction or a series of related
transactions, to another Person or group of affiliated Persons, unless:

 

(1)                                  either (a) the
applicable Issuer is the continuing entity or (b) the resulting, surviving
or transferee entity is a corporation organized under the laws of the United
States, any state thereof or the District of Columbia and expressly assumes by
supplemental indenture all of the applicable Issuer’s obligations in connection
with the Notes and this Indenture;

 

(2)                                  no Default or
Event of Default shall exist or shall occur immediately after giving effect on
a pro forma basis to such
transaction;

 

(3)                                  immediately
after giving effect to such transaction on a pro
forma basis, the consolidated resulting, surviving or transferee
entity would immediately thereafter be permitted to incur at least $1.00 of
additional Indebtedness pursuant to the Debt Incurrence Ratio set forth in Section 4.7
herein or, if not, the Debt Incurrence Ratio on a pro forma basis would be greater than the Debt Incurrence
Ratio immediately prior thereto; provided,
that this clause (3) shall not apply to a transaction that constitutes (a) solely
the merger of an Issuer and one of its previously existing Wholly Owned
Subsidiaries which is also a Subsidiary Guarantor for the purpose of
reincorporation into another jurisdiction or (b) solely the merger or
consolidation of (i) an Issuer and Parent so long as immediately prior to
such merger or consolidation Parent had no operations and no assets other than
the ownership of the Company’s Equity Interests (or other operations or assets
solely incidental thereto), or (ii) the merger or consolidation of the
Issuers, and in the case of each of clauses (a) and (b) of this
paragraph (3), such transaction is not for the purpose of evading this
provision and not in connection with any other transaction; and

 

(4)                                  each guarantor
of the Notes (including Parent and each Subsidiary Guarantor) that survives the
transaction shall have confirmed in writing to the Trustee that its Guarantee
shall apply to the obligations of the 

 

59

 

applicable Issuer or the surviving entity in
accordance with the Notes and this Indenture.

 

Section 5.2                                                              Successor
Corporation Substituted

 

Upon any consolidation or merger or any transfer of
all or substantially all of an Issuer’s assets in accordance with the
foregoing, the successor corporation formed by such consolidation or into which
such Issuer is merged or to which such transfer is made shall succeed to and
(except in the case of a lease) be substituted for, and may exercise every
right and power of, the applicable Issuer under the Indenture with the same
effect as if such successor corporation had been named therein as an Issuer,
and (except in the case of a lease) such Issuer shall be released from the
obligations under the Notes and the Indenture except with respect to any
obligations that arise from, or are related to, such transaction.

 

For purposes of the foregoing, the transfer (by
lease, assignment, sale or otherwise) of all or substantially all of the
properties and assets of one or more Subsidiaries, an Issuer’s interest in
which constitutes all or substantially all of such Issuer’s properties and
assets, shall be deemed to be the transfer of all or substantially all of such
Issuer’s properties and assets.

 

ARTICLE VI

 

DEFAULTS AND REMEDIES

 

Section 6.1                                                              Events of
Default

 

“Event of Default,” wherever used herein, means any
one of the following events:

 

(1)                                  the Issuers’
failure to pay any installment of interest on the Notes as and when the same
becomes due and payable and the continuance of any such failure for 30 days;

 

(2)                                  the Issuers’
failure to pay all or any part of the principal, or premium, if any, on the
Notes when and as the same becomes due and payable at maturity, redemption, by
acceleration or otherwise, including, without limitation, payment of the Change
of Control Purchase Price or the Asset Sale Offer Price, on Notes validly
tendered and not properly withdrawn pursuant to a Change of Control Offer or
Asset Sale Offer, as applicable;

 

(3)                                  the Issuers’
failure or the failure by any of the Subsidiaries to observe or perform any
other covenant or agreement contained in the Notes or this Indenture, except
for the provisions of Sections 4.13, 4.14, and 5.1 hereof, and the continuance
of such failure for a period of 30 days after written notice is given to an
Issuer by the Trustee or to an Issuer and the Trustee by the Holders of at
least 25% in aggregate principal amount of the Notes outstanding;

 

(4)                                  a court having
jurisdiction in the premises enters a decree or order for (a) relief in
respect of an Issuer or any Significant Subsidiary in an involuntary case under
any applicable Bankruptcy Law now or hereafter in effect, (b) appointment
of a receiver, liquidator, assignee, custodian, trustee, sequestrator or
similar official of an Issuer or any Significant Subsidiary or for all

 

60

 

or substantially all of the property and
assets of an Issuer or any Significant Subsidiary or (c) the winding up or
liquidation of the affairs of an Issuer or any Significant Subsidiary and, in
each case, such decree or order shall remain unstayed and in effect for a
period of 60 consecutive days;

 

(5)                                  an Issuer or any Significant
Subsidiary (a) commences a voluntary case under any applicable Bankruptcy
Law now or hereafter in effect, or consents to the entry of an order for relief
in an involuntary case under any such law, (b) consents to the appointment
of or taking possession by a receiver, liquidator, assignee, custodian,
trustee, sequestrator or similar official of an Issuer or any Significant
Subsidiary or for all or substantially all of the property and assets of such
Issuer or Significant Subsidiary or (c) effects any general assignment for
the benefit of creditors;

 

(6)                                  a default in
Indebtedness of an Issuer or the Indebtedness of any of the Subsidiaries with
an aggregate amount outstanding in excess of $10.0 million (a) resulting
from the failure to pay principal at maturity or (b) as a result of which
the maturity of such Indebtedness has been accelerated prior to its stated
maturity;

 

(7)                                  final
unsatisfied judgments not covered by insurance involving an amount in excess of
$5.0 million in any individual case or aggregating in excess of $10.0 million
at any one time rendered against an Issuer or any of the Subsidiaries and not
stayed, bonded or discharged within 60 days; and

 

(8)                                  any Guarantee of
Parent or a Subsidiary Guarantor ceases to be in full force and effect or
becomes unenforceable or invalid or is declared null and void (other than in
accordance with the terms of the Guarantee and this Indenture) or Parent or any
Subsidiary Guarantor denies or disaffirms its obligations under its Guarantee.

 

Section 6.2                                                              Acceleration

 

(a)                                  If an Event of
Default occurs and is continuing (other than an Event of Default specified in
Sections 6.1(4) and 6.1(5) above relating to an Issuer or any of the
Significant Subsidiaries), then in every such case, unless the principal of all
of the Notes shall have already become due and payable, either the Trustee or
the Holders of at least 25% in aggregate principal amount of the Notes then
outstanding, by notice in writing to the Issuers (and to the Trustee if given
by Holders) (an “Acceleration Notice”), may declare all principal, determined
as set forth below, and accrued interest thereon to be due and payable
immediately.  If an Event of Default
specified in Sections 6.1(4) or 6.1(5) above relating to an Issuer or
any of the Significant Subsidiaries occurs, all principal and accrued interest
thereon shall be immediately due and payable on all outstanding Notes without
any declaration or other act on the part of the Trustee or the Holders.

 

(b)                                 Prior to the
declaration of acceleration of the maturity of the Notes, the Holders of a
majority in aggregate principal amount of the Notes at the time outstanding may
waive on behalf of all Holders any Default, except a Default in the payment of
principal of or interest on any Note not yet cured or a Default with respect to
any covenant or provision which cannot be modified or amended without the
consent of the Holder of each outstanding Note affected.  Subject to the provisions of this Indenture
relating to the duties of the Trustee, the 

 

61

 

Trustee shall be under no obligation to
exercise any of its rights or powers under this Indenture at the request, order
or direction of any of the Holders, unless such Holders have offered to the
Trustee reasonable security or indemnity.

 

(c)                                  At any time
after such a declaration of acceleration being made and before a judgment or
decree for payment of the money due has been obtained by the Trustee as
hereinafter provided in this Article VI, the Holders of not less than a
majority in aggregate principal amount of then outstanding Notes, by written
notice to the Issuers and the Trustee, may rescind, on behalf of all Holders,
any such declaration of acceleration if:

 

(1)                                  the Issuers
have paid or deposited with the Trustee cash sufficient to pay:  (a) all overdue interest on all Notes; (b) the
principal of (and premium, if any, applicable to) any Notes which would become
due other than by reason of such declaration of acceleration, and interest
thereon at the rate borne by the Notes; (c) to the extent that payment of
such interest is lawful, interest upon overdue interest at the rate borne by
the Notes; and (d) all sums paid or advanced by the Trustee hereunder and
the reasonable compensation, expenses, disbursements and advances of the
Trustee and its agents and counsel, and all other amounts due the Trustee under
Section 7.7 hereof; and

 

(2)                                  all Events of
Default, other than the non-payment of the principal of, premium, if any, and
interest on the Notes which have become due solely by such declaration of
acceleration, have been cured or waived as provided in Section 6.4 hereof.

 

(d)                                 Notwithstanding
clause (c)(2) of this Section 6.2, no waiver shall be effective
against any Holder for any Event of Default or event which with notice or lapse
of time or both would be an Event of Default with respect to any covenant or
provision which cannot be modified or amended without the consent of the Holder
of each outstanding Note affected thereby, unless all such affected Holders
agree, in writing, to waive such Event of Default or other event.  No such waiver shall cure or waive any
subsequent default or impair any right consequent thereon.

 

Section 6.3                                                              Other Remedies

 

If an Event of Default occurs and is continuing, the
Trustee may pursue any available remedy to collect the payment of principal,
premium, if any, and interest on the Notes or to enforce the performance of any
provision of the Notes or this Indenture.

 

The Trustee may maintain a proceeding even if it
does not possess any of the Notes or does not produce any of them in the
proceeding.  A delay or omission by the
Trustee or any Holder of a Note in exercising any right or remedy accruing upon
an Event of Default shall not impair the right or remedy or constitute a waiver
of or acquiescence in the Event of Default. 
All remedies are cumulative to the extent permitted by law.

 

Subject to all provisions of this Indenture and
applicable law, the Holders of a majority in aggregate principal amount of the
Notes at the time outstanding shall have the right to direct the time, method
and place of conducting any proceeding for any remedy available to the Trustee,
or exercising the power conferred on the Trustee.

 

62

 

Section 6.4                                                              Waiver of Past
Defaults

 

Subject to Section 6.7 hereof, the Holders of
at least a majority in principal amount of the outstanding Notes by written
notice to the Issuers and to the Trustee, may, on behalf of all Holders, waive
any existing or past Default or Event of Default hereunder and its consequences
under this Indenture, except a default:

 

(1)           in the payment of principal of, premium, if any, or
interest on any Note not yet cured as specified in clauses (1) and (2) of
Section 6.1 hereof;

 

(2)           in respect of a covenant or provision hereof which, under Article IX,
cannot be modified or amended without the consent of the Holder of each
outstanding Note affected, unless all such affected Holders agree, in writing,
to waive such default; or

 

(3)           the rescission of which would conflict with any judgment
or decree of a court of competent jurisdiction.

 

Upon any such waiver, such default shall cease to
exist, and any Event of Default arising therefrom shall be deemed to have been
cured for every purpose of this Indenture; but no such waiver shall extend to
any subsequent or other default or impair any right arising therefrom.

 

Section 6.5                                                              Control by
Majority

 

Holders of at least a majority in aggregate
principal amount of the then outstanding Notes may direct the time, method and
place of conducting any proceeding for exercising any remedy available to the
Trustee or exercising any trust or power conferred on it.  However, the Trustee may refuse to follow any
direction that conflicts with law or this Indenture that the Trustee determines
in good faith may be unduly prejudicial to the rights of other Holders of Notes
not joining in the giving of such direction or that may involve the Trustee in
personal liability, and the Trustee may take any other action it deems proper
that is not inconsistent with any such direction received from Holders of the
Notes.

 

Section 6.6                                                              Limitation on
Suits

 

A Holder of a Note may pursue a remedy with respect
to this Indenture or the Notes only if:

 

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

 

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

 

(c)           such Holder of a Note offers, or Holders of Notes offer
and, if requested, provides or provide to the Trustee indemnity satisfactory to
the Trustee against any costs, liability or expense;

 

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

 

63

 

(e)           during such 60-day period the Holders of a majority in
principal amount of the then outstanding Notes do not give the Trustee a
direction inconsistent with the request.

 

A Holder of a Note may not use this Indenture
to prejudice the rights of another Holder of a Note or to obtain a preference
or priority over another Holder of a Note.

 

Section 6.7                                                              Rights of
Holders of Notes to Receive Payment

 

Notwithstanding any other provision of this
Indenture, except as permitted by Section 9.2 hereof, the right of any
Holder of a Note to receive payment of the principal of, premium and interest
on the Note, on or after the respective due dates expressed in the Note
(including in connection with an offer to purchase) or to bring suit for the
enforcement of any such payment on or after such respective dates, shall not be
impaired or affected without the consent of such Holder.

 

Section 6.8                                                              Collection Suit
by Trustee

 

If an Event of Default specified in Section 6.1
hereof occurs and is continuing, the Trustee is authorized to recover judgment
in its own name and as trustee of an express trust against the Issuers for the
whole amount of principal of, premium and interest remaining unpaid on the
Notes and interest on overdue principal and, to the extent lawful, interest and
such further amount as shall be sufficient to cover the costs and expenses of
collection, including the reasonable compensation, expenses, disbursements and
advances of the Trustee, its agents and counsel.

 

Section 6.9                                                              Trustee May File
Proofs of Claim

 

The Trustee is authorized to file such proofs of
claim and other papers or documents as may be necessary or advisable in order
to have the claims of the Trustee (including any claim for the reasonable
compensation, expenses, disbursements and advances of the Trustee, its agents
and counsel) and the Holders of the Notes allowed in any judicial proceedings
relative to the Issuers (or any other obligor upon the Notes), its creditors or
its property and shall be entitled and empowered to collect, receive and
distribute any money or other property payable or deliverable on any such
claims and any custodian in any such judicial proceeding is hereby authorized
by each Holder to make such payments to the Trustee, and in the event that the
Trustee shall consent to the making of such payments directly to the Holders,
to pay to the Trustee any amount due to it for the reasonable compensation,
expenses, disbursements and advances of the Trustee, its agents and counsel,
and any other amounts due the Trustee under Section 7.7 hereof.  To the extent that the payment of any such
compensation, expenses, disbursements and advances of the Trustee, its agents
and counsel, and any other amounts due the Trustee under Section 7.7
hereof out of the estate in any such proceeding, shall be denied for any
reason, payment of the same shall be secured by a Lien on, and shall be paid
out of, any and all distributions, dividends, money, securities and other
properties that the Holders may be entitled to receive in such proceeding
whether in liquidation or under any plan of reorganization or arrangement or
otherwise.  Nothing herein contained
shall be deemed to authorize the Trustee to authorize or consent to or accept
or adopt on behalf of any Holder any plan of reorganization, arrangement,
adjustment or composition affecting the Notes or the rights of any Holder, or
to authorize the Trustee to vote in respect of the claim of any Holder in any
such proceeding; provided, however
that the Trustee may, on behalf of the Holders, vote for the election of a
trustee in bankruptcy or similar official and may be a member of the creditor’s
committee.

 

64

 

Section 6.10                                                        Priorities

 

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

 

First:  to the
Trustee, its agents and attorneys for amounts due under Section 7.7
hereof, including payment of all compensation, expense and liabilities
incurred, and all advances made, by the Trustee and the costs and expenses of
collection (including the reasonable compensation, expenses, disbursements and
advances of the Trustee, its agents and counsel);

 

Second:  to Holders
of Notes for amounts due and unpaid on the Notes for principal and interest,
ratably, without preference or priority of any kind, according to the amounts
due and payable on the Notes for principal, premium and interest, respectively;
and

 

Third:  to the
Issuers or to such party as a court of competent jurisdiction shall direct.

 

The Trustee may fix a Record Date and payment date
for any payment to Holders of Notes pursuant to this Section 6.10.

 

Section 6.11                                                        Undertaking for
Costs

 

In any suit for the enforcement of any right or
remedy under this Indenture or in any suit against the Trustee for any action
taken or omitted by it as a Trustee, a court in its discretion may require the
filing by any party litigant in the suit of an undertaking to pay the costs of
the suit, and the court in its discretion may assess reasonable costs,
including reasonable attorneys’ fees, against any party litigant in the suit,
having due regard to the merits and good faith of the claims or defenses made
by the party litigant.  This Section 6.11
does not apply to a suit by the Trustee, a suit by a Holder of a Note pursuant
to Section 6.7 hereof, or a suit by Holders of more than 10% in principal
amount of the then outstanding Notes.

 

ARTICLE VII

 

TRUSTEE

 

Section 7.1                                                              Duties of
Trustee

 

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

 

(b)           Except during the continuance of an Event of Default of
which the Trustee has knowledge:

 

(i)            the duties of the Trustee shall be determined solely by
the express provisions of this Indenture and the Trustee need perform only
those duties that are specifically set forth in this Indenture and no others,
and no implied covenants or obligations shall be read into this Indenture
against the Trustee; and

 

65

 

(ii)           in the absence of bad faith on its part, the Trustee may
conclusively rely, as to the truth of the statements and the correctness of the
opinions expressed therein, upon certificates or opinions furnished to the
Trustee and conforming to the requirements of this Indenture.  However, the Trustee shall examine the
certificates and opinions to determine whether or not they conform to the
requirements of this Indenture.

 

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

 

(i)            this paragraph (c) does not limit the effect of
paragraph (b) of this Section 7.1;

 

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

 

(iii)          the Trustee shall not be liable with respect to any action
it takes or omits to take in good faith in accordance with a direction received
by it pursuant to Section 6.5 hereof.

 

(d)           Whether or not therein expressly so provided, every
provision of this Indenture that in any way relates to the Trustee is subject
to Sections 7.1 and 7.2 hereof.

 

(e)           No provision of this Indenture shall require the Trustee
to expend or risk its own funds or incur any liability.  The Trustee shall be under no obligation to
exercise any of its rights and powers under this Indenture at the request of
any Holders, unless such Holder shall have offered to the Trustee security and
indemnity satisfactory to it against any loss, liability or expense.

 

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

 

Section 7.2                                                              Rights of
Trustee

 

(a)           In connection with the Trustee’s rights and duties under
this Indenture, the Trustee may conclusively rely upon any document believed by
it to be genuine and to have been signed or presented by the proper
Person.  The Trustee need not investigate
any fact or matter stated in the document.

 

(b)           Before the Trustee acts or refrains from acting under this
Indenture, it may require an Officers’ Certificate or an Opinion of Counsel or
both.  The Trustee shall not be liable
for any action it takes or omits to take in good faith in reliance on such
Officers’ Certificate or Opinion of Counsel. 
The Trustee may consult with counsel of its selection and the advice of
such counsel or any Opinion of Counsel shall be full and complete authorization
and protection from liability in respect of any action taken, suffered or
omitted by it hereunder in good faith and in reliance thereon.

 

(c)           The Trustee may act through its attorneys and agents and
shall not be responsible for the misconduct or negligence of any agent
appointed with due care.

 

66

 

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

 

(e)           Unless otherwise specifically provided in this Indenture,
any demand, request, direction or notice from the Issuers shall be sufficient
if signed by an Officer of each of the Issuers.

 

(f)            The Trustee shall be under no obligation to exercise any
of the rights or powers vested in it by this Indenture at the request or direction
of any of the Holders unless such Holders shall have offered to the Trustee
security or indemnity satisfactory to it against the costs, expenses and
liabilities that might be incurred by it in compliance with such request or
direction.

 

(g)           Except with respect to Section 4.1 hereof, the
Trustee shall have no duty to inquire as to the performance of the Issuers’
covenants in Article IV hereof.  In
addition, the Trustee shall not be deemed to have knowledge of any Default or
Event of Default except (i) any Event of Default occurring pursuant to
Sections 6.1(1), 6.1(2) and 4.1 hereof or (ii) any Default or Event
of Default of which the Trustee shall have received written notification in the
manner set forth in this Indenture or a Responsible Officer of the Trustee
shall have obtained actual knowledge. 
Delivery of reports, information and documents to the Trustee under Section 4.3
hereof is for informational purposes only and the Trustee’s receipt of the
foregoing shall not constitute constructive notice of any information contained
therein or determinable from information contained therein, including the
Issuers’ or any Guarantor’s, as applicable, compliance with any of their
covenants thereunder (as to which the Trustee is entitled to rely exclusively
on an Officer’s Certificate).

 

(h)           The Trustee shall not be bound to make any investigation
into the facts or matters stated in any resolution, certificate, statement,
instrument, opinion, report, notice, request, direction, consent, order, bond,
debenture, note, other evidence of indebtedness or other paper or document, but
the Trustee may, in its discretion, make such further inquiry or investigation
into such facts or matters as it may see fit.

 

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

 

(j)            The Trustee may request that the Issuers deliver an
Officers’ Certificate setting forth the names of individuals and/or titles of
officers authorized at such time to take specified actions pursuant to this
Indenture, which Officers’ Certificate may be signed by any person authorized
to sign an Officer’s Certificate, including any person specified as so
authorized in any such certificate previously delivered and not superseded.

 

Section 7.3                                                              Individual
Rights of Trustee

 

The Trustee in its individual or any other capacity
may become the owner or pledgee of Notes and may otherwise deal with the
Issuers or any Affiliate of the Issuers with the same rights it would have if
it were not Trustee.  However, in the
event that the Trustee acquires any conflicting interest (as defined in the
TIA) it must eliminate such conflict within 90 days, apply to the SEC for
permission to continue as trustee or resign. 
Any Agent may do the same with like rights and duties.  The Trustee is also subject to Sections 7.10
and 7.11 hereof.

 

67

 

Section 7.4                                                              Trustee’s
Disclaimer

 

The Trustee shall not be responsible for and makes
no representation as to the validity or adequacy of this Indenture or the
Notes, it shall not be accountable for the Issuers’ use of the proceeds from
the Notes or any money paid to the Issuers or upon the Issuers’ direction under
any provision of this Indenture, it shall not be responsible for the use or
application of any money received by any Paying Agent other than the Trustee,
and it shall not be responsible for any statement or recital herein or any
statement in the Notes or any other document in connection with the sale of the
Notes or pursuant to this Indenture other than its certificate of
authentication.

 

Section 7.5                                                              Notice of
Defaults

 

If a Default or Event of Default occurs and is
continuing and if it is known to the Trustee, the Trustee shall mail to Holders
of Notes a notice in the manner provided by Section 313(c) of the TIA
of the Default or Event of Default, whether or not the TIA is then applicable
to the Indenture or the Notes, within 90 days after it occurs.  Except in the case of a Default or Event of
Default in payment of principal of, premium, if any, or interest on any Note,
the Trustee may withhold the notice if and so long as a committee of its
Officers in good faith determines that withholding the notice is in the
interests of the Holders of the Notes.

 

Section 7.6                                                              Reports by
Trustee to Holders of the Notes

 

Within 60 days after each May 15 beginning with
the May 15 following the date of this Indenture, and for so long as Notes
remain outstanding, the Trustee shall mail to the Holders of the Notes a brief
report dated as of such reporting date that complies with TIA § 313(a) (but
if no event described in TIA § 313(a) has occurred within the 12
months preceding the reporting date, no report need be transmitted).  The Trustee also shall comply with TIA
§ 313(b)(2).  The Trustee shall also
transmit by mail all reports as required by TIA § 313(c).

 

A copy of each report at the time of its mailing to
the Holders of Notes shall be mailed to the Issuers and filed with the SEC and
each stock exchange on which the Notes are listed in accordance with TIA
§ 313(d).  The Issuers shall
promptly notify the Trustee when the Notes are listed on any stock exchange.

 

Section 7.7                                                              Compensation
and Indemnity

 

The Issuers shall pay to the Trustee from time to
time such compensation as agreed upon in writing by the Trustee and the Issuers
for the Trustee’s, acceptance of this Indenture and services hereunder.  The Trustee’s compensation shall not be
limited by any law on compensation of a trustee of an express trust.  The Issuers shall reimburse the Trustee
promptly upon request for all reasonable disbursements, advances and expenses
incurred or made by it in addition to the compensation for its services.  Such expenses shall include the reasonable
compensation, disbursements and expenses of the Trustee’s agents and counsel.

 

The Issuers shall indemnify the Trustee and any predecessor
trustee against any and all losses, liabilities, claims, damages or expenses,
including taxes (other than taxes based upon, measured by or determined by the
income of the Trustee) (including reasonable attorneys’ fees) and incurred by
it arising out of or in connection with the acceptance or administration of its
duties under this Indenture, including the costs and expenses of enforcing this
Indenture against the Issuers (including this Section 7.7) and defending
itself against any claim (whether asserted by the Issuers or any Holder or any
other Person) or liability in connection with the exercise or 

 

68

 

performance of any of its
powers or duties hereunder, except to the extent any such loss, liability or
expense may be attributable to its negligence, bad faith or willful
misconduct.  The Trustee shall notify the
Issuers promptly of any claim for which it may seek indemnity.  Failure by the Trustee to so notify the
Issuers shall not relieve the Issuers of their obligations hereunder.  The Issuers shall defend the claim and the
Trustee shall cooperate in the defense. 
The Trustee may have separate counsel and the Issuers shall pay the
reasonable fees and expenses of such counsel. 
The Issuers need not pay for any settlement made without their consent,
which consent shall not be unreasonably withheld.

 

The obligations of the Issuers under this Section 7.7
shall survive the satisfaction and discharge of this Indenture and the
resignation or removal of the Trustee.

 

To secure the Issuers’ payment obligations in this Section 7.7,
the Trustee shall have a Lien prior to the Notes on all money or property held
or collected by the Trustee, except that held in trust to pay principal and
interest on particular Notes.  Such Lien
shall survive the satisfaction and discharge of this Indenture.

 

When the Trustee incurs expenses or renders services
after an Event of Default specified in Sections 6.1(4) or 6.1(5) hereof
occurs, the expenses and the compensation for the services (including the fees
and expenses of its agents and counsel) are intended to constitute expenses of
administration under any Bankruptcy Law.

 

The Trustee shall comply with the provisions of TIA
§ 313(b)(2) to the extent applicable.

 

Section 7.8                                                              Replacement of
Trustee

 

A resignation or removal of the Trustee and
appointment of a successor Trustee shall become effective only upon the
successor Trustee’s acceptance of appointment as provided in this Section 7.8.

 

The Trustee may resign in writing at any time and be
discharged from the trust hereby created by so notifying the Issuers.  The Holders of Notes of a majority in
principal amount of the then outstanding Notes may remove the Trustee by so
notifying the Trustee and the Issuers in writing.  The Issuers may remove the Trustee if:

 

(a)           the Trustee fails to comply with Section 7.10 hereof;

 

(b)           the Trustee is adjudged a bankrupt or an insolvent or an
order for relief is entered with respect to the Trustee under any Bankruptcy
Law;

 

(c)           a Custodian or public officer takes charge of the Trustee
or its property; or

 

(d)           the Trustee becomes incapable of acting.

 

If the Trustee resigns or is removed or if a vacancy
exists in the office of Trustee for any reason, the Issuers shall promptly
appoint a successor Trustee.  Within one
year after the successor Trustee takes office, the Holders of a majority in
principal amount of the then outstanding Notes may appoint a successor Trustee
to replace the successor Trustee appointed by the Issuers.

 

69

 

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

 

If the Trustee, after written request by any Holder
of a Note who has been a Holder of a Note for at least six months, fails to
comply with Section 7.10 hereof, such Holder of a Note may petition any
court of competent jurisdiction for the removal of the Trustee and the
appointment of a successor Trustee.

 

A successor Trustee shall deliver a written acceptance
of its appointment to the retiring Trustee and to the Issuers.  Thereupon, the resignation or removal of the
retiring Trustee shall become effective, and the successor Trustee shall have
all the rights, powers and duties of the Trustee under this Indenture.  The successor Trustee shall mail a notice of
its succession to Holders of the Notes. 
The retiring Trustee shall promptly transfer all property held by it as
Trustee to the successor Trustee; provided all
sums owing to the Trustee hereunder have been paid and subject to the Lien
provided for in Section 7.7 hereof. 
Notwithstanding replacement of the Trustee pursuant to this Section 7.8,
the Issuers’ obligations under Section 7.7 hereof shall continue for the
benefit of the retiring Trustee.

 

Section 7.9                                                              Successor
Trustee by Merger, etc.

 

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

 

Section 7.10                                                        Eligibility;
Disqualification

 

There shall at all times be a Trustee hereunder that
is a corporation or trust company (or a member of a bank holding company)
organized and doing business under the laws of the United States of America or
of any state thereof that is authorized under such laws to exercise corporate
trustee power, that is subject to supervision or examination by federal or
state authorities and that has (or the bank holding company of which it is a
member has) a combined capital and surplus of at least $50,000,000 as set forth
in its most recent published annual report of condition.

 

This Indenture shall always have a Trustee who
satisfies the requirements of TIA § 310(a)(1), (2) and (5).  The Trustee is subject to TIA § 310(b).

 

Section 7.11                                                        Preferential
Collection of Claims Against Issuers

 

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

 

70

 

ARTICLE VIII

 

LEGAL DEFEASANCE AND
COVENANT DEFEASANCE AND

SATISFACTION AND DISCHARGE

 

Section 8.1                                                              Option to
Effect Legal Defeasance or Covenant Defeasance

 

The Issuers may, at the option of the Board of
Directors evidenced by a resolution set forth in an Officers’ Certificate, at
any time, elect to have either Section 8.2 or 8.3 hereof be applied to all
outstanding Notes upon compliance with the conditions set forth below in this Article VIII.

 

Section 8.2                                                              Legal
Defeasance and Discharge

 

Upon the Issuers’ exercise under Section 8.1
hereof of the option applicable to this Section 8.2, each of the Issuers
and the Guarantors, as applicable, shall, subject to the satisfaction of the
applicable conditions set forth in Section 8.4 hereof, be deemed to have
been discharged from its obligations with respect to all outstanding Notes and
Guarantees, as applicable, on the date the conditions set forth below are
satisfied (hereinafter, “Legal Defeasance”). 
For this purpose, Legal Defeasance means that the Issuers shall be
deemed to have paid and discharged all amounts owed under the outstanding Notes
and the Guarantors shall be deemed to have paid and discharged the entire
Indebtedness represented by the outstanding Guarantees, which shall thereafter
be deemed to be “outstanding” only for the purposes of Section 8.5 hereof
and the other Sections of this Indenture referred to in (a) and (b) below,
and to have satisfied all other obligations under such Notes, such Guarantees
and this Indenture (and the Trustee, on demand of and at the expense of the
Issuers, shall execute proper instruments acknowledging the same), except for
the following provisions which shall survive until otherwise terminated or
discharged hereunder:  (a) the
rights of Holders of outstanding Notes to receive solely from the trust fund
described in Section 8.4 hereof, and as more fully set forth in Section 8.4,
payments in respect of the principal of, premium, if any, and interest on such
Notes when such payments are due, (b) the Issuers’ obligations with
respect to such Notes under Sections 2.6, 2.7, 2.10 and 4.2 hereof, (c) the
rights, powers, trusts, duties and immunities of the Trustee hereunder and the
Issuers’ obligations in connection therewith and (d) the Legal Defeasance
provisions under Sections 8.4, 8.5, 8.6, and 8.7 hereof.  Subject to compliance with this Article VIII,
the Issuers may exercise their option under this Section 8.2
notwithstanding the prior exercise of their option under Section 8.3
hereof.

 

Section 8.3                                                              Covenant
Defeasance

 

Upon the Issuers’ exercise under Section 8.1
hereof of the option applicable to this Section 8.3, subject to the
satisfaction of the applicable conditions set forth in Section 8.4 hereof,
the Issuers and the Guarantors shall be released from their respective obligations
under Sections 4.3, 4.4, 4.5, 4.7, 4.8, 4.9, 4.10, 4.11, 4.12, 4.13, 4.14, 4.15
and 4.17, and clauses (2), (3) and (4) of Section 5.1 hereof,
and the Guarantors shall be released from their obligations under Section 10.3(a) hereof,
in each case on and after the date the conditions set forth below are satisfied
(hereinafter, “Covenant Defeasance”), and the Notes and the Guarantees shall
thereafter be deemed not “outstanding” for the purposes of any direction,
waiver, consent or declaration or act of Holders (and the consequences of any
thereof) in connection with such covenants, but shall continue to be deemed “outstanding”
for all other purposes hereunder (it being understood that such Notes shall not
be deemed outstanding for accounting purposes). 
For this purpose, Covenant Defeasance means that, with respect to the
outstanding Notes, the Issuers and the 

 

71

 

Guarantors may omit to
comply with and shall have no liability in respect of any term, condition or
limitation set forth in any such covenant, whether directly or indirectly, by
reason of any reference elsewhere herein to any such covenant or by reason of
any reference in any such covenant to any other provision herein or in any
other document and such omission to comply shall not constitute a Default or an
Event of Default under Section 6.1 hereof, but, except as specified above,
the remainder of this Indenture and such Notes shall be unaffected
thereby.  In addition, upon the Issuers’
exercise under Section 8.1 hereof of the option applicable to this Section 8.3,
subject to the satisfaction of the applicable conditions set forth in Section 8.4
hereof, (x) Sections 6.1(3), (6), (7) and (8) hereof shall not
constitute Events of Default and (y) Sections 6.1(4) and 6.1(5) hereof
shall not constitute an Event of Default to the extent they occur after the
91st day following the occurrence of the Issuers’ exercise of Covenant
Defeasance; provided, however
that for all other purposes as set forth herein, such Covenant Defeasance
provisions shall be effective.

 

Section 8.4                                                              Conditions to
Legal or Covenant Defeasance

 

The following shall be the conditions to the
application of either Section 8.2 or 8.3 hereof to the outstanding Notes:

 

In order to exercise either Legal Defeasance or
Covenant Defeasance:

 

(a)           the Issuers must irrevocably deposit with the Trustee, in
trust, for the benefit of the Holders, cash in United States legal tender, U.S.
Government Obligations, or a combination thereof, in amounts that shall be
sufficient, in the opinion of a nationally recognized investment bank,
appraisal firm or firm of independent public accountants, to pay the principal
of, premium, if any, and interest on the outstanding Notes on the stated date
for payment thereof or on the applicable Redemption Date, as the case may be,
and the Trustee must have, for the benefit of Holders of the Notes, a valid,
perfected exclusive security interest in such trust;

 

(b)           in the case of an election under Section 8.2 hereof,
the Issuers must deliver to the Trustee an Opinion of Counsel in the United
States reasonably acceptable to the Trustee confirming that (A) the
Issuers have received from, or there has been published by, the Internal
Revenue Service a ruling or (B) since the date of this Indenture, there
has been a change in the applicable federal income tax law, in either case to
the effect that, the Holders of the outstanding Notes shall not recognize
income, gain or loss for federal income tax purposes as a result of such Legal
Defeasance and shall be subject to federal income tax on the same amounts, in
the same manner and at the same times as would have been the case if such Legal
Defeasance had not occurred;

 

(c)           in the case of an election under Section 8.3 hereof,
the Issuers must deliver to the Trustee an Opinion of Counsel reasonably
acceptable to the Trustee from United States legal counsel confirming that
Holders of the outstanding Notes shall not recognize income, gain or loss for
federal income tax purposes as a result of such Covenant Defeasance and shall
be subject to federal income tax on the same amounts, in the same manner and at
the same times as would have been the case if such Covenant Defeasance had not
occurred;

 

(d)           in the case of an election under Section 8.2 or 8.3
hereof, no Default or Event of Default shall have occurred and be continuing on
the date of the deposit (other than a Default or Event of Default resulting
from borrowing of funds to be applied to such deposit), and in the case of an
election under Section 8.2 hereof, no Event of Default specified in Section 6.1(4) or
(5) hereof shall have occurred at any time from the date of the deposit to
the 91st calendar day 

 

72

 

thereafter (it being understood that this
condition to Legal Defeasance may not be satisfied until such 91st calendar day
after the date of deposit);

 

(e)           the Defeasance may not result in a breach or violation of,
or constitute a default under any material agreement or instrument (other than
this Indenture) to which an Issuer or any of the Subsidiaries is a party or by
which an Issuer or any of the Subsidiaries is bound;

 

(f)            the Issuers must deliver to the Trustee an Officers’
Certificate stating that the deposit was not made by the Issuers with the
intent to hinder, delay or defraud any other of the Issuers’ creditors; and

 

(g)           the Issuers must deliver to the Trustee an Officers’
Certificate confirming the satisfaction of the conditions in clauses (a) through
(f) above, and an Opinion of Counsel, confirming the satisfaction of the
conditions in clauses (a) (with respect to the validity and perfection of
the security interest), (b), (c) and (e) above.

 

Legal Defeasance and Covenant Defeasance shall be
deemed to occur on the date all of the applicable conditions set forth in this Section 8.4
are satisfied.

 

Section 8.5                                                              Deposited Money
and Government Securities to be Held in Trust; Other Miscellaneous Provisions

 

Subject to Section 8.6 hereof, all money and
U.S. Government Obligations (including the proceeds thereof) deposited with the
Trustee (or other qualifying trustee, collectively for purposes of this Section 8.5,
the “Trustee”) pursuant to Section 8.4 hereof in respect of the
outstanding Notes shall be held in trust and, applied by the Trustee, in
accordance with the provisions of such Notes and this Indenture, to the
payment, either directly or through any Paying Agent (including the Issuers
acting as Paying Agent) as the Trustee may determine, to the Holders of such
Notes of all sums due and to become due thereon in respect of principal,
premium, if any, and interest, but such money need not be segregated from other
funds except to the extent required by law.

 

The Issuers shall pay and indemnify the Trustee
against any tax, fee or other charge imposed on or assessed against the cash or
U.S. Government Obligations deposited pursuant to Section 8.4 hereof or
the principal and interest received in respect thereof, other than any such
tax, fee or other charge which by law is for the account of the Holders of the
outstanding Notes.

 

Anything in this Article VIII to the contrary
notwithstanding, the Trustee shall deliver or pay to the Issuers from time to
time upon the request of the Issuers any money or U.S. Government Obligations
held by it as provided in Section 8.4 hereof which, in the opinion of a
firm of independent public accountants nationally recognized in the United
States expressed in a written certification thereof delivered to the Trustee
(which may be the opinion delivered under Section 8.4(a) hereof), are
in excess of the amount thereof that would then be required to be deposited to
effect an equivalent Legal Defeasance or Covenant Defeasance.

 

Section 8.6                                                              Repayment to
Issuers

 

Any money deposited with the Trustee or any Paying
Agent, or then held by the Issuers, in trust for the payment of the principal
of, premium, if any, or interest on any Note and remaining unclaimed for two
years after such principal, and premium, if any, or interest has 

 

73

 

become due and payable shall
be paid to the Issuers on their written request or (if then held by the
Issuers) shall be discharged from such trust; and the Holder of such Note shall
thereafter, as a creditor, look only to the Issuers for payment thereof, and
all liability of the Trustee or such Paying Agent with respect to such trust
money, and all liability of the Issuers as trustee thereof, shall thereupon
cease; provided, however,
that the Trustee or such Paying Agent, before being required to make any such
repayment, may at the expense of the Issuers cause to be published once, in the
New York Times and The Wall Street Journal (national edition), notice that such
money remains unclaimed and that, after a date specified therein, which shall not
be less than 30 days from the date of such notification or publication, any
unclaimed balance of such money then remaining shall be repaid to the Issuers.

 

Section 8.7                                                              Reinstatement

 

If the Trustee or Paying Agent is unable to apply
any United States legal tender or U.S. Government Obligations in accordance
with Section 8.2 or 8.3 hereof, as the case may be, by reason of any order
directing the repayment of the deposited money to the Issuers or otherwise
making the deposit unavailable to make payments under the Notes when due, or if
any court enters an order avoiding the deposit of money with the Trustee or
Paying Agent or otherwise requires the payment of the money so deposited to the
Issuers or to a fund for the benefit of its creditors, then (so long as the
insufficiency exists or the order remains in effect) the Issuers’ and the
Guarantors’ obligations under this Indenture and the Notes shall be revived and
reinstated as though no deposit had occurred pursuant to Section 8.4 or
8.5 hereof until such time as the Trustee or Paying Agent is permitted to apply
all such money in accordance with Section 8.4 or 8.5 hereof, as the case
may be; provided, however,
that, if the Issuers makes any payment of principal of, premium, if any, or
interest on any Note following the reinstatement of its obligations, the
Issuers shall be subrogated to the rights of the Holders of such Notes to
receive such payment from the money held by the Trustee or Paying Agent.

 

Section 8.8                                                              Satisfaction
and Discharge

 

The Indenture will be discharged and will cease to
be of further effect (except as to the Issuers’ obligations under Sections 2.6,
2.7, 2.10 and 4.2 hereof) as to all outstanding Notes when either:

 

(a)           All outstanding Notes (other than lost, stolen or
destroyed Notes) have been delivered to the Trustee for cancellation; or

 

(b)           (1)           the
Issuers have given irrevocable and unconditional notice of redemption for all
of the outstanding Notes under Article III hereof, or all outstanding
Notes have otherwise become due and payable or will become due and payable
within one year, and the Issuers have irrevocably deposited or caused to be
deposited with the Trustee an amount of money sufficient to pay and discharge
the entire indebtedness (including all principal, premium, if any, and accrued
interest) on all outstanding Notes,

 

(2)           the
Issuers have delivered irrevocable instructions to the Trustee to apply the
deposited money toward the payment of the Notes at maturity or the Redemption
Date, as the case may be,

 

(3)           the
Trustee, for the benefit of the Holders of the Notes, has a valid, perfected,
first priority security interest in the trust,

 

74

 

(4)           no
Default or Event of Default has occurred and is continuing on the date of the
deposit or will occur as a result of the deposit and the deposit will not
result in a breach or violation of, or constitute a default under, any other
instrument to which an Issuer or any Subsidiary Guarantor is a party or by
which an Issuer or any Subsidiary Guarantor is bound, and

 

(5)           the
Issuers have paid all other amounts payable by them under this Indenture.

 

The Issuers must also deliver to the Trustee an
Officers’ Certificate and an Opinion of Counsel confirming the satisfaction of
the conditions in clauses (3) (with respect to the validity and perfection
of the security interest) and (4) above.

 

ARTICLE IX

 

AMENDMENT, SUPPLEMENT AND
WAIVER

 

Section 9.1                                                              Without Consent
of Holders of Notes

 

Notwithstanding Section 9.2 hereof, the
Issuers, the Guarantors and the Trustee may amend or supplement this Indenture,
the Notes or any Guarantee, without the consent of any Holder of a Note:

 

(a)           to cure any ambiguity, defect or inconsistency;

 

(b)           to provide for uncertificated Notes in addition to or in
place of certificated Notes;

 

(c)           to provide for the assumption of the Issuers’ obligations
to the Holders of the Notes in the case of a merger or consolidation pursuant
to Article V hereof;

 

(d)           to provide for additional Guarantors as set forth in Section 4.15
hereof or for the release or assumption of a Guarantee in compliance with this
Indenture;

 

(e)           to make any change that would provide any additional
rights or benefits to the Holders of the Notes or that does not adversely
affect the rights hereunder of any Holder of the Note;

 

(f)            to comply with the provisions of the Depositary,
Euroclear or Clearstream or the Trustee with respect to the provisions of this
Indenture or the Notes relating to transfers and exchanges of Notes or
beneficial interests therein; or

 

(g)           to provide for the issuance of Additional Notes in
accordance with the limitations set forth in this Indenture as of the date
hereof.

 

Upon the request of the Issuers accompanied by a
resolution of its Board of Directors authorizing the execution of any such
amended or supplemental Indenture, and upon receipt by the Trustee of the
documents described in Section 9.6 hereof, the Trustee shall join with the
Issuers in the execution of any amended or supplemental Indenture authorized or
permitted by the terms of this Indenture and to make any further appropriate
agreements and stipulations that may be therein contained, but the Trustee may,
but shall not be obligated to, 

 

75

 

enter into such amended or
supplemental Indenture that adversely affects its own rights, duties or
immunities under this Indenture or otherwise.

 

Section 9.2                                                              With Consent of
Holders of Notes

 

Except as expressly stated otherwise in this Section 9.2,
and subject to Sections 6.4 and 6.7 hereof, the Issuers, the Guarantors and the
Trustee may amend or supplement this Indenture, the Notes and the Guarantees,
with the consent of the Holders of a majority in aggregate principal amount of
the Notes then outstanding (including, without limitation, consents obtained in
connection with a purchase of, or tender offer or exchange offer for, the
Notes), and, subject to Sections 6.4 and 6.7 hereof, any existing Default or
Event of Default (other than a Default or Event of Default in the payment of
the principal of, premium, if any, or interest on the Notes, except a payment
default resulting from an acceleration that has been rescinded) or compliance
with any provision of this Indenture or the Notes or the Guarantees may be
waived with the consent of the Holders of a majority in aggregate principal
amount of the then outstanding Notes (including consents obtained in connection
with a purchase of, or tender offer or exchange offer for, the Notes).

 

Subject to Sections 6.4 and 6.7 hereof, the Holders
of a majority in aggregate principal amount of the Notes then outstanding may
waive compliance in a particular instance by the Issuers or any Subsidiary with
any provision of this Indenture or the Notes.

 

However, without the consent of each Holder affected
(it being understood that, except as expressly stated otherwise in paragraphs (a) through
(d) below, Section 4.13 and 4.14 hereof may be amended, waived or
modified in accordance with the first paragraph of this Section 9.2) an
amendment or waiver may not (with respect to any Notes held by a non-consenting
Holder):

 

(a)           change the Stated Maturity on any Note, or reduce the
principal amount thereof or the rate (or extend the time for payment) of
interest thereon or any premium payable upon the redemption thereof at the Issuers’
option, or change the city of payment where, or the coin or currency in which,
any Note or any premium or the interest thereon is payable, or impair the right
to institute suit for the enforcement of any such payment on or after the
Stated Maturity thereof (or, in the case of redemption at the Issuers’ option,
on or after the Redemption Date), or after an Asset Sale or Change of Control
has occurred reduce the Change of Control Purchase Price or the Asset Sale
Offer Price with respect to the corresponding Asset Sale or Change of Control
or alter the provisions (including the defined terms used therein) regarding
the Issuers’ right to redeem the Notes as a right, or at the Issuers’ option in
manner adverse to the Holders; or

 

(b)           reduce the percentage in principal amount of the
outstanding Notes, the consent of whose Holders is required for any such
amendment, supplemental indenture or waiver provided for in this Indenture; or

 

(c)           modify any of the waiver provisions, except to increase
any required percentage or to provide that certain other provisions of this
Indenture cannot be modified or waived without the consent of the Holder of
each outstanding Note affected thereby; or

 

(d)           cause the Notes or any Guarantee to become contractually
subordinate in right of payment to any other Indebtedness.

 

76

 

In connection with any amendment, supplement or
waiver under this Article IX, the Issuers may, but shall not be obligated
to, offer to any Holder who consents to such amendment, supplement or waiver,
or to all Holders, consideration for such Holder’s consent to such amendment,
supplement or waiver.

 

Upon the request of the Issuers accompanied by a
resolution of the Board of Directors authorizing the execution of any such
amended or supplemental Indenture, and upon the filing with the Trustee of
evidence satisfactory to the Trustee of the consent of the Holders of Notes as
aforesaid, and upon receipt by the Trustee of the documents described in Section 9.6
hereof, the Trustee shall join with the Issuers in the execution of such
amended or supplemental Indenture unless such amended or supplemental Indenture
adversely affects the Trustee’s own rights, duties or immunities under this
Indenture or otherwise, in which case the Trustee may in its discretion, but
shall not be obligated to, enter into such amended or supplemental Indenture.

 

It shall not be necessary for the consent of the
Holders of Notes under this Section 9.2 to approve the particular form of
any proposed amendment or waiver, but it shall be sufficient if such consent
approves the substance thereof.

 

After an amendment, supplement or waiver under this Section 9.2
becomes effective, the Issuers shall mail to the Holders of Notes affected
thereby a notice briefly describing the amendment, supplement or waiver.  Any failure of the Issuers to mail such
notice, or any defect therein, shall not, however, in any way impair or affect
the validity of any such amended or supplemental Indenture or waiver.

 

Section 9.3                                                              Compliance with
Trust Indenture Act

 

Every amendment or supplement to this Indenture or
the Notes shall be set forth in an amended or supplemental Indenture that
complies with the TIA as then in effect.

 

Section 9.4                                                              Revocation and
Effect of Consents

 

Until an amendment, supplement or waiver becomes
effective (as determined by the Issuers and which may be prior to any such
amendment, supplement or waiver becoming operative), a consent to it by a
Holder of a Note is a continuing consent by the Holder of a Note and every
subsequent Holder of a Note or portion of a Note that evidences the same
Indebtedness as the consenting Holder’s Note, even if notation of the consent
is not made on any Note.  However, any
such Holder of a Note or subsequent Holder of a Note may revoke the consent as
to its Note if the Trustee receives written notice of revocation before the
date the waiver, supplement or amendment becomes effective (as determined by
the Issuers), which may be prior to any such amendment, supplement or waiver
becoming operative.

 

The Issuers may, but shall not be obligated to, fix
a record date for the purpose of determining the Holders entitled to consent to
any amendment, supplement or waiver, which record date shall be the date so
fixed by the Issuers notwithstanding the provisions of the TIA.  If a record date is fixed, then
notwithstanding the last sentence of the immediately preceding paragraph, those
Persons who were Holders at such record date, and only those Persons (or their
duly designated proxies), shall be entitled to revoke any consent previously
given, whether or not such Persons continue to be Holders after such record
date.

 

After an amendment, supplement or waiver becomes
effective, it shall bind every Holder unless it makes a change described in any
of clauses (a) through (d) of Section 9.2 hereof, 

 

77

 

in which case, the
amendment, supplement or waiver shall bind only each Holder of a Note who has
consented to it and every subsequent Holder of a Note or portion of a Note that
evidences the same debt as the consenting Holder’s Note; provided,
that any such waiver shall not impair or affect the right of any non-consenting
Holder to receive payment of principal and premium of and interest on a Note,
on or after the respective dates set for such amounts to become due and payable
expressed in such Note, or to bring suit for the enforcement of any such
payment on or after such respective dates.

 

Section 9.5                                                              Notation on or
Exchange of Notes

 

The Trustee may place an appropriate notation about
an amendment, supplement or waiver on any Note thereafter authenticated.  The Issuers in exchange for all Notes may
issue and the Trustee shall authenticate new Notes that reflect the amendment,
supplement or waiver.

 

Failure to make the appropriate notation or issue a
new Note shall not affect the validity and effect of such amendment, supplement
or waiver.

 

Section 9.6                                                              Trustee to Sign
Amendments, etc.

 

The Trustee shall sign any amended or supplemental
Indenture authorized pursuant to this Article IX if the amendment or
supplement does not adversely affect the rights, duties, liabilities or
immunities of the Trustee.  The Issuers
may not sign an amended or supplemental Indenture until the Board of Directors
approves it.  In executing any amended or
supplemental Indenture, the Trustee shall be entitled to receive indemnity
reasonably satisfactory to it and to receive and (subject to Section 7.1
hereof) shall be fully protected in relying upon, an Officers’ Certificate and
an Opinion of Counsel stating that the execution of such amended or
supplemental Indenture is authorized or permitted by this Indenture.

 

ARTICLE X

 

GUARANTEES

 

Section 10.1                                                        Guarantees

 

By its execution hereof, each of the Guarantors
acknowledges and agrees that it receives substantial benefits from the Issuers
and that such party is providing its Guarantee for good and valuable
consideration, including, without limitation, such substantial benefits and
services.  Accordingly, subject to the
provisions of this Article X, each Guarantor, jointly and severally,
hereby unconditionally guarantees on a senior basis to each Holder of a Note
authenticated and delivered by the Trustee and its successors and assigns
that:  (i) the principal of,
premium, if any, and interest on the Notes shall be duly and punctually paid in
full when due, whether at maturity, by acceleration, call for redemption, upon
a Change of Control Offer, upon an Asset Sale Offer or otherwise, and interest
on overdue principal, premium, if any, and (to the extent permitted by law)
interest on any interest, if any, on the Notes and all other obligations of the
Issuers to the Holders or the Trustee hereunder or under the Notes (including
fees, expenses or other) shall be promptly paid in full or performed, all in
accordance with the terms hereof; and (ii) in case of any extension of
time of payment or renewal of any Notes or any of such other obligations, the
same shall be promptly paid in full when due or performed in accordance with
the terms of the extension or renewal, whether at stated maturity, by
acceleration, call for redemption, upon a Change of Control, upon an Asset Sale
Offer or otherwise, subject, however, in the case of 

 

78

 

clauses (i) and (ii) above,
to the limitations set forth in Section 10.5 hereof (collectively, the “Guarantee
Obligations”).

 

Subject to the provisions of this Article X,
each Guarantor hereby agrees that its Guarantee hereunder shall be
unconditional, irrespective of the validity, regularity or enforceability of
the Notes or this Indenture, the absence of any action to enforce the same, any
waiver or consent by any Holder of the Notes with respect to any thereof, the
entry of any judgment against the Issuers, any action to enforce the same or
any other circumstance which might otherwise constitute a legal or equitable
discharge or defense of a Guarantor. 
Each Guarantor (and each Issuer, to the extent such Issuer is considered
a surety under applicable law) hereby waives and relinquishes:  (a) any right to require the Trustee,
the Holders or the Issuers (each, a “Benefited Party”) to proceed against the
Issuers, the Subsidiaries or any other Person or to proceed against or exhaust
any security held by a Benefited Party at any time or to pursue any other
remedy in any secured party’s power before proceeding against the Guarantors; (b) any
defense that may arise by reason of the incapacity, lack of authority, death or
disability of any other Person or Persons or the failure of a Benefited Party
to file or enforce a claim against the estate (in administration, bankruptcy or
any other proceeding) of any other Person or Persons; (c) demand, protest
and notice of any kind (except as expressly required by this Indenture), including
but not limited to notice of the existence, creation or incurring of any new or
additional Indebtedness or obligation or of any action or non-action on the
part of the Guarantors, the Issuers, the Subsidiaries, any Benefited Party, any
creditor of the Guarantors, the Issuers or the Subsidiaries or on the part of
any other Person whomsoever in connection with any obligations the performance
of which are hereby guaranteed; (d) any defense based upon an election of
remedies by a Benefited Party, including but not limited to an election to
proceed against the Guarantors for reimbursement; (e) any defense based
upon any statute or rule of law which provides that the obligation of a
surety must be neither larger in amount nor in other respects more burdensome
than that of the principal; (f) any defense arising because of a Benefited
Party’s election, in any proceeding instituted under the Bankruptcy Law, of the
application of Section 1111(b)(2) of the Bankruptcy Code; and (g) any
defense based on any borrowing or grant of a security interest under Section 364
of the Bankruptcy Code.  The Guarantors
hereby covenant that, except as otherwise provided herein and therein, the
Guarantees shall not be discharged except by payment in full of all Guarantee
Obligations, including the principal, premium, if any, and interest on the
Notes and all other costs provided for under this Indenture or as provided in Article VIII.

 

If any Holder or the Trustee is required by any
court or otherwise to return to either the Issuers or the Guarantors, or any
trustee or similar official acting in relation to either the Issuers or the
Guarantors, any amount paid by the Issuers or the Guarantors to the Trustee or
such Holder, the Guarantees, to the extent theretofore discharged, shall be
reinstated in full force and effect. 
Each of the Guarantors agrees that it shall not be entitled to any right
of subrogation in relation to the Holders in respect of any Guarantee
Obligations hereby until payment in full of all such obligations guaranteed
hereby.  Each Guarantor agrees that, as
between it, on the one hand, and the Holders of Notes and the Trustee, on the
other hand, (x) the maturity of the obligations guaranteed hereby may be
accelerated as provided in Article VI hereof for the purposes hereof,
notwithstanding any stay, injunction or other prohibition preventing such
acceleration in respect of the Guarantee Obligations, and (y) in the event
of any acceleration of such obligations as provided in Article VI hereof,
such Guarantee Obligations (whether or not due and payable) shall forthwith
become due and payable by such Guarantor for the purpose of the Guarantee.

 

Section 10.2                                                        Execution and
Delivery of Guarantees

 

79

 

To evidence the Guarantees set forth in Section 10.1
hereof, each of the Guarantors agrees that a notation of the Guarantees
substantially in the form included in Exhibit A hereto shall be endorsed
on each Note authenticated and delivered by the Trustee and that this Indenture
shall be executed on behalf of each of the Guarantors by an Officer of each of
the Guarantors.

 

Each of the Guarantors agrees that the Guarantees
set forth in this Article X shall remain in full force and effect and
apply to all the Notes notwithstanding any failure to endorse on each Note a
notation of the Guarantees.

 

If an Officer whose facsimile signature is on a Note
or a notation of Guarantee no longer holds that office at the time the Trustee
authenticates the Note on which the Guarantees are endorsed, the Guarantees
shall be valid nevertheless.

 

The delivery of any Note by the Trustee, after the
authentication thereof hereunder, shall constitute due delivery of the
Guarantees set forth in this Indenture on behalf of the Guarantors.

 

Section 10.3                                                        Guarantors May Consolidate,
etc., on Certain Terms

 

(a)           Except for a merger or consolidation in which a Guarantor
is sold and its Guarantee is released in compliance with the provisions of Section 10.4
hereof, neither the Parent nor any Subsidiary Guarantor shall consolidate or
merge with or into (whether or not Parent or such Subsidiary Guarantor is the
surviving Person) another Person unless (i) subject to the provisions of
the following paragraph and the other provisions of this Indenture, the Person
formed by or surviving any such consolidation or merger (if other than Parent
or such Subsidiary Guarantor) assumes all the obligations of Parent or such
Subsidiary Guarantor pursuant to a supplemental indenture in form reasonably
satisfactory to the Trustee, pursuant to which such Person shall guarantee on a
senior basis all of the Issuers’ obligations under the Indenture in the same
manner and to the same extent that Parent or such Subsidiary, as applicable,
guaranteed such obligations under the Indenture immediately prior to such
consolidation or merger, and (ii) immediately before and immediately after
giving effect to such transaction on a pro forma
basis, no Default or Event of Default shall have occurred or be
continuing.  The provisions of this Section 10.3(a) shall
not apply to the merger of any Subsidiary Guarantors with and into each other
or with or into an Issuer, or the merger of Parent with or into an Issuer in
accordance with Section 5.1.  In
case of any such consolidation or merger and upon the assumption by the
successor corporation, by supplemental indenture, executed and delivered to the
Trustee and reasonably satisfactory in form to the Trustee, of the Guarantees
endorsed upon the Notes and the due and punctual performance of all of the
covenants and conditions of this Indenture to be performed by such Guarantor,
such successor corporation shall succeed to and be substituted for the Parent
or Subsidiary Guarantor with the same effect as if it had been named herein as
a Guarantor.  Such successor corporation
thereupon may cause to be signed any or all of the Guarantees to be endorsed
upon all of the Notes issuable hereunder which theretofore shall not have been
signed by the Issuers and delivered to the Trustee.  All the Guarantees so issued shall in all
respects have the same legal rank and benefit under this Indenture as the
Guarantees theretofore and thereafter issued in accordance with the terms of
this Indenture as though all of such Guarantees had been issued at the date of
the execution hereof.

 

(b)           The Trustee shall be entitled to receive an Officers’
Certificate as conclusive evidence that any such consolidation or merger, and
any such assumption of 

 

80

 

Guarantee Obligations, comply with the provisions
of this Section 10.3.  Such Officers’
Certificate shall comply with the provisions of Section 11.5 hereof.

 

Section 10.4                                                        Release of
Guarantors

 

Parent shall be released from its obligations under
its Guarantee in the event of any merger, sale or consolidation involving the
Company that also constitutes a Change of Control with respect to the Company
(but not with respect to Parent).

 

Notwithstanding Section 10.3(a) hereof,
upon the sale or disposition (including by merger or stock purchase) of a Subsidiary
Guarantor (as an entirety) to an entity which is not and is not required to
become a Subsidiary Guarantor, or the designation of a Subsidiary to become an
Unrestricted Subsidiary, in each case, which transaction is otherwise in
compliance with this Indenture (including, without limitation, the provisions
of Section 4.13 hereof), or solely in the case of a Guarantee arising
solely as a result of the second paragraph of Section 4.15 hereof, the
release or termination of the guarantee giving rise to the obligation to enter
into a Guarantee, such Subsidiary Guarantor shall be released automatically
from its obligations under its Subsidiary Guarantee; provided,
however, that any such termination shall
occur only to the extent that all obligations of such Subsidiary Guarantor
under all of its guarantees of any Indebtedness of either Issuer or any
Indebtedness of Parent or any of the other Subsidiaries or any Subsidiary of
Parent shall also terminate upon such release, sale or transfer and none of its
Equity Interests are pledged for the benefit of any holder of any Indebtedness
of either Issuer or any Indebtedness of Parent or any other Subsidiary or any
Subsidiary of Parent.

 

Upon delivery by the Issuers to the Trustee of an
Officer’s Certificate, to the effect that such sale or other disposition or
that such designation was made by the Issuers in accordance with the provisions
of this Indenture, the Trustee shall execute any documents reasonably required
in order to evidence the release of any such Guarantor from its obligations
under its Guarantee.  Any Guarantor not
released from its obligations under its Guarantee shall remain liable for the
full amount of principal of and interest on the Notes and for the other obligations
of any Guarantor under this Indenture as provided in this Article X.

 

Notwithstanding the foregoing provisions of this Article X,
(i) any Guarantor whose Guarantee would otherwise be released pursuant to
the provisions of this Section 10.4 may elect, at its sole discretion, by
written notice to the Trustee, to maintain such Guarantee in effect
notwithstanding the event or events that otherwise would cause the release of
such Guarantee (which election to maintain such Guarantee in effect may be
conditional or for a limited period of time), and (ii) any Subsidiary
which is not a Guarantor may elect, at its sole discretion, by written notice
to the Trustee, to become a Guarantor (which election may be conditional or for
a limited period of time).

 

Section 10.5                                                        Limitation of
Guarantor’s Liability; Certain Bankruptcy Events

 

(a)           Each Guarantor, and by its acceptance hereof each Holder,
hereby confirms that it is the intention of all such parties that the Guarantee
Obligation of such Guarantor pursuant to its Guarantee not constitute a
fraudulent transfer or conveyance for purposes of any Bankruptcy Law, the
Uniform Fraudulent Conveyance Act, the Uniform Fraudulent Transfer Act or any
similar federal or state law.  To
effectuate the foregoing intention, the Holders and such Guarantor hereby
irrevocably agree that the Guarantee Obligations of such Guarantor under this Article X
shall be limited to the maximum amount as shall, after giving effect to all
other contingent and fixed liabilities of such Guarantor and after giving
effect to any collections from 

 

81

 

or payments made by or on behalf of any other
Guarantor in respect of the Guarantee Obligations of such other Guarantor under
this Article X, result in the Guarantee Obligations of such Guarantor
under the Guarantee of such Guarantor not constituting a fraudulent transfer or
conveyance.

 

(b)           Each Guarantor hereby covenants and agrees, to the fullest
extent that it may do so under applicable law, that in the event of the
insolvency, bankruptcy, dissolution, liquidation or reorganization of an
Issuer, such Guarantor shall not file (or join in any filing of), or otherwise
seek to participate in the filing of, any motion or request seeking to stay or
to prohibit (even temporarily) execution on the Guarantee and hereby waives and
agrees not to take the benefit of any such stay of execution, whether under Section 362
or 105 of the Bankruptcy Law or otherwise.

 

Section 10.6                                                        Application of
Certain Terms and Provisions to the Guarantors

 

(a)           For purposes of any provision of this Indenture which
provides for the delivery by any Guarantor of an Officers’ Certificate and/or
an Opinion of Counsel, the definitions of such terms in Section 1.1 hereof
shall apply to such Guarantor as if references therein to the Issuers were
references to such Guarantor.

 

(b)           Any request, direction, order or demand which by any
provision of this Indenture is to be made by any Guarantor, shall be sufficient
if evidenced as described in Section 11.2 hereof as if references therein
to the Issuers were references to such Guarantor.

 

(c)           Any notice or demand which by any provision of this
Indenture is required or permitted to be given or served by the Trustee or by
the holders of Notes to or on any Guarantor may be given or served as described
in Section 11.2 hereof as if references therein to the Issuers were
references to such Guarantor.

 

(d)           Upon any demand, request or application by any Guarantor
to the Trustee to take any action under this Indenture, such Guarantor shall
furnish to the Trustee such certificates and opinions as are required in Section 11.4
hereof as if all references therein to the Issuers were references to such
Guarantor.

 

ARTICLE XI

 

MISCELLANEOUS

 

Section 11.1                                                        Trust Indenture
Act Controls

 

If any provision of this Indenture limits, qualifies
or conflicts with the duties imposed by the TIA, the imposed duties shall
control.

 

Section 11.2                                                        Notices

 

Any notice or communication by the Issuers or the
Trustee to the other is duly given if in writing and delivered in Person or
mailed by first class mail (registered or certified, return receipt requested),
telecopier or overnight air courier guaranteeing next day delivery, to the
others’ address:

 

If to the Issuers

 

82

 

or the Guarantors:

 

Douglas
Dynamics, L.L.C.

7777 North 73rd Street

Milwaukee, WI  53223

Attention:  Robert McCormick

 

with copies (which shall not constitute notice) to:

 

Gibson,
Dunn & Crutcher LLP

333 South Grand Avenue

Los Angeles, CA  90071

Attention:  Linda Curtis, Esq.

 

If to the Trustee:

 

U.S.
Bank National Association

60 Livingston Avenue

St. Paul, Minnesota  55107-2292

Attention:  Richard Prokosch

 

The Issuers or the Trustee, by notice to the others
may designate additional or different addresses for subsequent notices or
communications.

 

All notices and communications (other than those
sent to Holders) shall be deemed to have been duly given:  (i) at the time delivered by hand, if
personally delivered; (ii) when answered back, if telexed; (iii) when
receipt acknowledged, if telecopied; and (iv) the next Business Day after
timely delivery to the courier, if sent by overnight air courier guaranteeing
next day delivery.

 

Any notice or communication to a Holder shall be
mailed by first class mail, certified or registered, return receipt requested,
or by overnight air courier guaranteeing next day delivery to its address shown
on the register kept by the Registrar. 
Any notice or communication shall also be so mailed to any Person
described in TIA § 313(c), to the extent required by the TIA.  Failure to mail a notice or communication to
a Holder or any defect in it shall not affect its sufficiency with respect to
other Holders.

 

If a notice or communication is mailed in the manner
provided above within the time prescribed, it is duly given, whether or not the
addressee receives it.

 

If the Issuers mail a notice or communication to
Holders, they shall mail a copy to the Trustee and each Agent at the same time.

 

Section 11.3                                                        Communication
by Holders of Notes with Other Holders of Notes

 

Holders may communicate pursuant to TIA § 312(b) with
other Holders with respect to their rights under this Indenture or the
Notes.  The Issuers, the Trustee, the
Registrar and anyone else shall have the protection of TIA § 312(c).

 

Section 11.4                                                        Certificate and
Opinion as to Conditions Precedent

 

83

 

Upon any request or application by the Issuers to
the Trustee to take any action under this Indenture, the Issuers shall furnish
to the Trustee:

 

(a)           an Officers’ Certificate in form and substance reasonably
satisfactory to the Trustee (which shall include the statements set forth in Section 11.5
hereof) stating that, in the opinion of the signer or signers, all conditions
precedent and covenants, if any, provided for in this Indenture relating to the
proposed action have been satisfied; and

 

(b)           an Opinion of Counsel in form and substance reasonably
satisfactory to the Trustee (which shall include the statements set forth in Section 11.5
hereof) stating that, in the opinion of such counsel, all such conditions
precedent have been satisfied.

 

Section 11.5                                                        Statements
Required in Certificate or Opinion

 

Each certificate or opinion with respect to
compliance with a condition or covenant provided for in this Indenture (other
than a certificate provided pursuant to TIA § 314(a)(4)) shall comply with
the provisions of TIA § 314(e) and shall include:

 

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

 

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

 

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

 

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

 

Section 11.6                                                        Rules by
Trustee and Agents

 

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

 

Section 11.7                                                        No Personal
Liability of Directors, Officers, Employees and Stockholders

 

No direct or indirect stockholder, member, employee,
manager, Affiliate, officer or director, as such, past, present or future of an
Issuer, Parent, the Subsidiary Guarantors or any successor entity shall have
any personal liability in respect of such Issuer’s obligations or the
obligations of Parent or the Subsidiary Guarantors under the Indenture or the
Notes, except that this provision shall in no way limit the obligation of
Parent or any Subsidiary Guarantor pursuant to any Guarantee.  Each Holder by accepting a Note waives and
releases all such liability.  The waiver
and release are part of the consideration for issuance of the Notes.

 

Section 11.8                                                        Governing Law

 

84

 

THE INTERNAL LAW OF THE STATE OF NEW YORK SHALL
GOVERN AND BE USED TO CONSTRUE THIS INDENTURE, THE NOTES AND THE GUARANTEES,
INCLUDING, WITHOUT LIMITATION, SECTIONS 5-1401 AND 5-1402 OF THE NEW YORK
GENERAL OBLIGATIONS LAW AND NEW YORK CIVIL PRACTICE LAWS AND RULES 327(b).

 

Section 11.9                                                        No Adverse
Interpretation of Other Agreements

 

This Indenture may not be used to interpret any
other indenture, loan or debt agreement of the Issuers or the Subsidiaries or
of any other Person.  Any such indenture,
loan or debt agreement may not be used to interpret this Indenture.

 

Section 11.10                                                  Successors

 

All agreements of the Issuers and the Guarantors in
this Indenture and the Notes shall bind their successors.  All agreements of the Trustee in this
Indenture shall bind its successors.

 

Section 11.11                                                  Severability

 

In case any one or more of the provisions of this
Indenture or in the Notes or in the Guarantees shall be held invalid, illegal
or unenforceable, in any respect for any reason, the validity, legality and
enforceability of any such provision in every other respect and of the
remaining provisions shall not in any way be affected or impaired thereby, it
being intended that all of the provisions hereof shall be enforceable to the
full extent permitted by law.

 

Section 11.12                                                  Counterpart
Originals

 

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

 

Section 11.13                                                  Table of
Contents, Headings, Etc.

 

The Table of Contents and headings of the Articles
and Sections of this Indenture have been inserted for convenience of reference
only, are not to be considered a part of this Indenture and shall in no way
modify or restrict any of the terms or provisions hereof.

 

[Signatures on following page]

 

85

 

SIGNATURES

 

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

 

	
   

  	
  THE
  ISSUERS:

  
	
   

  	
   

  
	
   

  	
  DOUGLAS
  DYNAMICS, L.L.C.

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:
  

  	
  /s/
  James L. Janik

  
	
   

  	
   

  	
  Name:
  James L. Janik

  
	
   

  	
   

  	
  Title:
  President and Chief Executive Officer

  
	
   

  	
   

  
	
   

  	
  DOUGLAS
  DYNAMICS FINANCE COMPANY

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:
  

  	
  /s/
  James L. Janik

  
	
   

  	
   

  	
  Name:
  James L. Janik

  
	
   

  	
   

  	
  Title:
  President and Chief Executive Officer

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  PARENT:

  
	
   

  	
   

  
	
   

  	
  DOUGLAS
  DYNAMICS HOLDINGS, INC.

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:
  

  	
  /s/
  James L. Janik

  
	
   

  	
   

  	
  Name:
  James L. Janik

  
	
   

  	
   

  	
  Title:
  President and Chief Executive Officer

  
	
   

  	
   

  
	
   

  	
  THE
  TRUSTEE:

  
	
   

  	
   

  
	
   

  	
  U.S.
  BANK NATIONAL ASSOCIATION

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:
  

  	
  /s/
  Richard Prokosch

  
	
   

  	
   

  	
  Name:
  Richard Prokosch

  
	
   

  	
   

  	
  Title: Vice President

  

 

Indenture Signature PageExhibit 4.3

 

FIRST SUPPLEMENTAL INDENTURE

 

First Supplemental Indenture (“Supplemental
Indenture”) dated as of June 28, 2005 among Fisher, LLC, a Delaware
limited liability company (the “Guaranteeing Subsidiary”), a subsidiary of
Douglas Dynamics, L.L.C., a Delaware limited liability company (the “Company”),
the Company, Douglas Dynamics Finance Company, a Delaware corporation (together
with the Company, “Issuers”), Douglas Dynamics Holdings, Inc., a Delaware
corporation (“Parent”), and U.S. Bank National Association, as Trustee under
the Indenture referred to below (the “Trustee”).

 

 

W I T N E S S E T H

 

WHEREAS, the Issuers and Parent have heretofore
executed and delivered to the Trustee an indenture (the “Indenture”) dated as
of December 16, 2004 providing for the issuance of 73⁄4% Senior Notes due
2012 (the “Notes”);

 

WHEREAS, the Indenture provides that under certain
circumstances the Guaranteeing Subsidiary shall execute and deliver to the
Trustee a supplemental indenture pursuant to which any newly-acquired or
created Guarantor shall unconditionally guarantee all of the Issuers’
obligations under the Notes and the Indenture on the terms and conditions set
forth herein (the “Subsidiary Guarantee”); and

 

WHEREAS, pursuant to Section 9.1 of the
Indenture, the Trustee is authorized to execute and deliver this Supplemental
Indenture.

 

NOW THEREFORE, in consideration of the foregoing and
for other good and valuable consideration, the receipt of which is hereby
acknowledged, the Guaranteeing Subsidiary and the Trustee mutually covenant and
agree for the equal and ratable benefit of the Holders of the Notes as follows:

 

1.             Capitalized Terms.  Capitalized terms used herein without
definition shall have the meanings assigned to them in the Indenture.

 

Agreement
to Guarantee.  The
Guaranteeing Subsidiary irrevocably and unconditionally guarantees the
Guarantee Obligations, which include (i) the due and punctual payment of
the principal of, premium, if any, and interest on the Notes, whether at
maturity, by acceleration, call for redemption, upon a Change of Control Offer,
upon an Asset Sale Offer or otherwise, the due and punctual payment of interest
on the overdue principal and premium, if any, and (to the extent permitted by
law) interest on any interest on the Notes, and payment of expenses, and the
due and punctual performance of all other obligations of the Issuers, to the
Holders or the Trustee all in accordance with the terms set forth in Article X
of the Indenture, and (ii) in case of any extension of time of payment or
renewal of any Notes or any such other obligations, that the same will be
promptly paid in full when due or performed in accordance with the terms of the
extension or renewal, whether at stated maturity, by acceleration, call for
redemption, upon a Change of Control Offer, upon an Asset Sale Offer or
otherwise.

 

The obligations of Guaranteeing Subsidiary to the
Holders and to the Trustee pursuant to this Subsidiary Guarantee and the
Indenture are expressly set forth in Article X of the Indenture and
reference is hereby made to such Indenture for the precise terms of this
Subsidiary Guarantee.

 

1

 

No past, present or future director, officer,
employee, incorporator or stockholder (direct or indirect) of the Guaranteeing
Subsidiary (or any such successor entity), as such, shall have any liability
for any obligations of the Guaranteeing Subsidiary under this Subsidiary
Guarantee or the Indenture or for any claim based on, in respect of, or by
reason of, such obligations or their creation, except in their capacity as an
obligor or Guarantor of the Notes in accordance with the Indenture.

 

This is a continuing Guarantee and shall remain in
full force and effect and shall be binding upon the Guaranteeing Subsidiary and
its successors and assigns until full and final payment of all of the Issuers’
obligations under the Notes and Indenture or until released in accordance with
the Indenture and shall inure to the benefit of the successors and assigns of
the Trustee and the Holders, and, in the event of any transfer or assignment of
rights by any Holder or the Trustee, the rights and privileges herein conferred
upon that party shall automatically extend to and be vested in such transferee
or assignee, all subject to the terms and conditions hereof.  This is a Guarantee of payment and
performance and not of collectibility.

 

The obligations of the Guaranteeing Subsidiary under
its Subsidiary Guarantee shall be limited to the extent necessary to insure
that it does not constitute a fraudulent conveyance under applicable law.

 

THE TERMS OF ARTICLE X OF THE INDENTURE ARE
INCORPORATED HEREIN BY REFERENCE.

 

NEW YORK
LAW TO GOVERN.  THE
INTERNAL LAW OF THE STATE OF NEW YORK SHALL GOVERN AND BE USED TO CONSTRUE THIS
SUPPLEMENTAL INDENTURE, INCLUDING, WITHOUT LIMITATION, SECTION 5-1401 OF
THE NEW YORK GENERAL OBLIGATIONS LAW.

 

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

 

Effect of
Headings.  The Section headings
herein are for convenience only and shall not affect the construction hereof.

 

2

 

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

 

	
   

  	
  THE
  ISSUERS:

  
	
   

  	
   

  
	
   

  	
  DOUGLAS
  DYNAMICS, L.L.C.

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/
  Bob McCormick

  
	
   

  	
  Name:

  	
  Bob
  McCormick

  
	
   

  	
  Title:

  	
  V.P.
  — CFO

  

 

	
   

  	
  DOUGLAS
  DYNAMICS FINANCE COMPANY

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/
  Bob McCormick

  
	
   

  	
  Name:

  	
  Bob
  McCormick

  
	
   

  	
  Title:

  	
  V.P.
  — CFO

  

 

	
   

  	
  PARENT:

  
	
   

  	
   

  
	
   

  	
  DOUGLAS
  DYNAMICS HOLDINGS, INC.

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/
  Bob McCormick

  
	
   

  	
  Name:

  	
  Bob
  McCormick

  
	
   

  	
  Title:

  	
  V.P.
  — CFO

  

 

	
   

  	
  GUARANTEEING SUBSIDIARY:

  
	
   

  	
   

  
	
   

  	
  FISHER, LLC

  
	
   

  	
  By:

  	
  Douglas Dynamics, L.L.C.,

  
	
   

  	
   

  	
  its sole Member and Manager

  

 

 

	
   

  	
  By:

  	
  /s/ Bob McCormick

  
	
   

  	
  Name:

  	
  Bob McCormick

  
	
   

  	
  Title:

  	
  V.P. — CFO

  
	
   

  	
   

  
	
   

  	
  THE
  TRUSTEE:

  

 

 

	
   

  	
  U.S.
  BANK NATIONAL ASSOCIATION

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/
  U.S. Bank National Association

  
	
   

  	
  Name:

  
	
   

  	
  Title:

  

 

3

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