Document:

Exhibit 4.1

 

STOCK
PURCHASE AGREEMENT

 

DATED AS OF
NOVEMBER 19, 2003

 

BETWEEN

 

MAIN STREET
AND MAIN INCORPORATED

 

AND

 

Sergio
Zyman

 

 

MAIN STREET AND MAIN INCORPORATED

5050 North 40th Street, Suite 200

Phoenix, Arizona 85018

 

 

November 19,
2003

 

 

Mr. Sergio Zyman

Zyman Marketing Group

Chairman & Founder

2695 Buford Highway

Suite 200

Atlanta, Georgia  30324

 

 

Dear Mr. Zyman:

 

This will confirm
the terms and conditions of your $1,000,000 investment in Main Street and Main
Incorporated (the “Company”).

 

1.             Sale of the Shares.  The Company will sell to you, and you will
purchase from the Company, 500,000 shares of the Company’s Common Stock (the
“Shares”) at a price of $2.00 per share.

 

2.             Representations, Warranties, and Agreements of the Company.  In connection with your purchase, the
Company represents, warrants, and agrees as follows:

 

(a)           Status and Authority of the Company.  The Company is a corporation duly organized,
validly existing and in good standing under the laws of the state of Delaware
and has the power to own its assets and properties and to carry on its business
as it is now being conducted.

 

(b)           Power of the Company to Execute Agreement.  The Company has full power and authority to
execute, deliver, and perform this Agreement, and this Agreement is the legal
and binding obligation of the Company and is enforceable against it in
accordance with its terms.

 

(c)           Agreement Not in Breach of Other Agreements Affecting the Company.  The execution and delivery of this
Agreement, the consummation of the transactions hereby contemplated, and the
fulfillment of the terms hereof will not result in the breach of any term or
provision of, or constitute a default under, or conflict with, or cause the
acceleration of any obligation under, any agreement or other instrument of any
description to which the

 

1

 

Company is a party or by
which the Company is bound, or any judgment, decree, order, or award of any
court, governmental body, or arbitrator.

 

(d)           Status of Shares to be Purchased.  When issued and paid for, the Shares will be
duly and validly authorized and issued, fully paid, and non-assessable.

 

3.             Buyer’s
Representations, Warranties and Agreements.  To induce the Company to issue the Shares,
you represent, warrant, and agree as follows:

 

(a)           Power
of the Buyer to Execute Agreement. 
You have full power to execute, deliver, and perform this Agreement, and
this Agreement is your legal and binding obligation and is enforceable against
you in accordance with its terms.

 

(b)           Agreement
Not in Breach of Other Instruments. 
The execution and delivery of this Agreement, the consummation of the
transactions contemplated hereby, and the fulfillment of the terms hereof will
not result in the breach of any term or provision of, or constitute a default
under, or conflict with, or cause the acceleration of any obligation under, any
agreement or other instrument of any description to which you are a party or by
which you are bound, or any judgment, decree, order, or award of any court,
governmental body, or arbitrator.

 

4.             Further
Representations, Warranties, and Agreements of Buyer.  You further represent, warrant, and agree as
follows:

 

(a)           Ability
to Bear Risk; Business and Financial Knowledge and Experience.  You can bear the economic risk of the
purchase of the Shares; you have sufficient knowledge and experience in
business and financial matters as to be capable of evaluating the merits and
risks of your purchase of the Shares; and you are an accredited investor as
defined in Rule 501 under the Securities Act of 1933.

 

(b)           Knowledge
Respecting the Company.  You
(i) know or have had the opportunity to acquire all information concerning the
business, affairs, financial condition, plans, and prospects of the Company
that you deem relevant to make a fully informed decision respecting the
purchase of the Shares, (ii) have been encouraged and have had the opportunity
to rely upon the advice of your legal counsel and accountants and other
advisers with respect to the purchase of the Shares; and (iii) have had the
opportunity to ask such questions and receive such information and answers
respecting, among other things, the business, affairs, financial condition,
plans, and prospects of the Company and the terms and conditions of the
purchase of the Shares as you have requested so as to more fully understand
your investment.  Without limiting the
foregoing, you acknowledge that you have been provided with or have access to
complete copies of the Company’s Form 10-K Report for the year ended
December 30, 2002, the Company’s Form 10-Q Report for the quarter ended
September 29, 2003, the Company’s 2003 Annual Report to Stockholders, and
the Company’s Proxy Statement for its 2003 Annual Meeting of Stockholders.

 

(c)           Absence
of Representations and Warranties. 
You confirm that neither the Company nor anyone purportedly acting on
behalf of the Company has made any representations, warranties, agreements, or
statements other than those contained herein respecting the business, affairs,
financial condition, plans, or prospects of the Company nor have

 

2

 

you relied on any
representations, warranties, agreements, or statements in the belief that they
were made on behalf of any of the foregoing nor have you relied on the absence
of any such representations, warranties, agreements, or statements in reaching
your decision to purchase the Shares.

 

(d)           No
Distribution.  You are
acquiring the Shares for your own account without a view to public distribution
or resale, and you have no contract, undertaking, agreement, or arrangement to transfer, sell, or
otherwise dispose of any Shares or any interest therein to any other person.

 

(e)           Shares
to be Restricted.  You
understand that the Shares will be “restricted securities” within the meaning
of Rule 144 under the Securities Act of 1933, as amended (the “Securities
Act”).  The certificates representing
the Shares will have a legend to this effect.

 

5.             Registration Rights.  If at any time the Company determines to
register any of its securities under the Securities Act for sale to the public,
whether for its own account or for the account of other security holders or
both (except with respect to registration statements on Form S-8 or its then
equivalent, or in connection with a Rule 145 transaction or Form S-4 or its
equivalent, or another form not available for registering the Shares for sale
to the public), each such time it will give prompt written notice to you of its
intention so to do and of the proposed method of distribution of such
securities.  Upon your written request,
received by the Company within 20 days after the giving of any such notice by
the Company, to include in the registration all or any part of the Shares, the
Company will use all reasonable efforts to cause the Shares as to which
registration shall have been so requested under this Section 5 to
be included in the securities to be covered by the registration statement
proposed to be filed by the Company, all to the extent and under the conditions
such registration is permitted under the Securities Act.  In the event that any registration pursuant
to this Section 5 shall be, in whole or in part, an underwritten
public offering of Common Stock, the number of Shares to be included in such an
underwriting may be reduced if and to the extent that the managing underwriter
shall be of the opinion that the inclusion of some or all of the Shares would
adversely affect the marketing of the securities to be sold by the Company
therein.  Any such limitation shall be
imposed in such manner so as to avoid any diminution in the number of shares
the Company may register for sale by giving first priority for the shares to be
registered for issuance and sale by the Company.  Notwithstanding the foregoing provisions, the Company may, in its
sole discretion, terminate or withdraw any registration statement referred to
in this Section 5 without thereby incurring any liability to you.

 

In such event, however, the
Company shall use its best efforts to register the Shares as part of the
underwritten registration even if only part or none of the Shares are offered
for sale as part of the underwritten public offering.  The Company agrees to indemnify you and hold you harmless against
any and all loss, liability, claim, damage and expense whatsoever, as incurred,
to which you may become subject under the Securities Act or otherwise that
arise out of or are based upon any untrue statement or alleged untrue statement
of a material fact contained in a registration statement registering, or any
prospectus covering, the Shares, or any amendment thereto, or the omission or
alleged omission to state therein a material fact required to be stated therein
or necessary to make the statements therein not misleading, and against any and
all loss, liability, claim, damage and expense whatsoever  (including

 

3

 

reasonable fees and
disbursements of counsel), incurred by you in investigating, preparing or
defending against, or to the extent of the aggregate amount paid in settlement
of, any litigation, or investigation or proceeding by any governmental agency
or body, commenced or threatened, or of any claim whatsoever based upon any
such untrue statement or alleged untrue statement or any omission or alleged
omission, if such settlement is effected with the written consent of the
Company.

 

6.             Further Assurances.  You and the Company shall execute and
deliver all such other instruments and take all such other action as either of
us may reasonably request from time to time in order to effectuate the
transactions provided for herein.

 

7.             Miscellaneous.

 

(a)           Controlling
Law.  This Agreement and all
questions relating to its validity, interpretation, performance, and
enforcement will be governed by and construed in accordance with the laws of
the state of Delaware, notwithstanding any Delaware or other conflict-of-law
provisions to the contrary.

 

(b)           Binding
Nature of Agreement; No Assignment. This Agreement shall be binding
upon and inure to the benefit of you and the Company and the respective heirs,
personal representatives, successors, and assigns of you and the Company,
except that neither you nor the Company may assign or transfer any rights or
obligations under this Agreement without the prior written consent of the
other.

 

(c)           Entire
Agreement.  This Agreement
contains the entire understanding between you and the Company with respect to
the subject matter hereof and supersedes all prior and contemporaneous
agreements and understandings, inducements or conditions, express or implied,
oral or written, except as herein contained.

 

(d)           Paragraph
Headings.  The paragraph
headings in this Agreement are for convenience only; they form no part of this
Agreement and shall not affect its interpretation.

 

If the foregoing is
satisfactory and you wish to acquire the Shares subject to the terms and
conditions set forth herein, would you so indicate by signing and returning a
copy of this letter to me.

 

	
   

  	
  Very truly yours,

  
	
   

  	
   

  
	
   

  	
  MAIN STREET AND MAIN
  INCORPORATED

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
  John F. Antioco

  	
   

  
	
   

  	
  Chairman of the Board

  

 

4

 

	
  ACCEPTED AND APPROVED:

  
	
   

  
	
   

  
	
  Sergio Zyman

  
	
   

  
	
   

  
	
  Dated:

  	
   

  	
   

  

 

5EXHIBIT 4.8

 

 

 

PLIANT CORPORATION

 

111/8%
Senior Secured Discount Notes due 2009

 

 

 

 

INDENTURE

 

Dated as of February 17,
2004

 

 

 

 

WILMINGTON TRUST COMPANY,

 

as Trustee

 

 

 

 

TABLE OF CONTENTS

 

	
  ARTICLE
  I

  	
   

  
	
   

  	
   

  
	
  Definitions and Incorporation by Reference

  	
   

  
	
   

  	
   

  	
   

  
	
  SECTION
  1.01.

  	
  Definitions.

  	
   

  
	
  SECTION
  1.02.

  	
  Other
  Definitions.

  	
   

  
	
  SECTION
  1.03.

  	
  Incorporation
  by Reference of Trust Indenture Act

  	
   

  
	
  SECTION
  1.04.

  	
  Rules
  of Construction

  	
   

  
	
  SECTION
  1.05.

  	
  Designated
  Senior Indebtedness

  	
   

  
	
   

  	
   

  	
   

  
	
  ARTICLE
  II

  	
   

  
	
   

  	
   

  	
   

  
	
  The
  Securities

  	
   

  
	
   

  	
   

  
	
  SECTION
  2.01.

  	
  Amount
  of Securities; Issuable in Series

  	
   

  
	
  SECTION
  2.02.

  	
  Form
  and Dating

  	
   

  
	
  SECTION
  2.03.

  	
  Execution
  and Authentication

  	
   

  
	
  SECTION
  2.04.

  	
  Registrar
  and Paying Agent

  	
   

  
	
  SECTION
  2.05.

  	
  Paying
  Agent to Hold Money in Trust

  	
   

  
	
  SECTION
  2.06.

  	
  Holder
  Lists

  	
   

  
	
  SECTION
  2.07.

  	
  Transfer
  and Exchange

  	
   

  
	
  SECTION
  2.08.

  	
  Replacement
  Securities

  	
   

  
	
  SECTION
  2.09.

  	
  Outstanding
  Securities

  	
   

  
	
  SECTION
  2.10.

  	
  Temporary
  Securities

  	
   

  
	
  SECTION
  2.11.

  	
  Cancelation

  	
   

  
	
  SECTION
  2.12.

  	
  Defaulted
  Interest

  	
   

  
	
  SECTION
  2.13.

  	
  CUSIP
  and ISIN Numbers

  	
   

  
	
   

  	
   

  	
   

  
	
  ARTICLE
  III

  	
   

  
	
   

  	
   

  	
   

  
	
  Redemption

  	
   

  
	
   

  	
   

  	
   

  
	
  SECTION
  3.01.

  	
  Notices
  to Trustee

  	
   

  
	
  SECTION
  3.02.

  	
  Selection
  of Securities To Be Redeemed

  	
   

  
	
  SECTION
  3.03.

  	
  Notice
  of Redemption

  	
   

  
	
  SECTION
  3.04.

  	
  Effect
  of Notice of Redemption

  	
   

  
	
  SECTION
  3.05.

  	
  Deposit
  of Redemption Price

  	
   

  
	
  SECTION
  3.06.

  	
  Securities
  Redeemed in Part

  	
   

  

 

 

	
  ARTICLE
  IV

  	
   

  
	
   

  	
   

  	
   

  
	
  Covenants

  	
   

  
	
   

  	
   

  	
   

  
	
  SECTION
  4.01.

  	
  Payment
  of Securities

  	
   

  
	
  SECTION
  4.02.

  	
  SEC
  Reports

  	
   

  
	
  SECTION
  4.03.

  	
  Limitation
  on Indebtedness

  	
   

  
	
  SECTION
  4.04.

  	
  Limitation
  on Restricted Payments

  	
   

  
	
  SECTION
  4.05.

  	
  Limitation
  on Restrictions on Distributions from Restricted Subsidiaries and Negative
  Pledges

  	
   

  
	
  SECTION
  4.06.

  	
  Limitation
  on Sales of Assets and Subsidiary Stock

  	
   

  
	
  SECTION
  4.07.

  	
  Limitation
  on Transactions with Affiliates

  	
   

  
	
  SECTION
  4.08.

  	
  Change
  of Control

  	
   

  
	
  SECTION
  4.09.

  	
  Compliance
  Certificate

  	
   

  
	
  SECTION
  4.10.

  	
  Further
  Instruments and Acts

  	
   

  
	
  SECTION
  4.11.

  	
  Future
  Note Guarantors and Liens

  	
   

  
	
  SECTION
  4.12.

  	
  Limitation
  on Lines of Business

  	
   

  
	
  SECTION
  4.13.

  	
  Limitation
  on Liens

  	
   

  
	
  SECTION
  4.14.

  	
  Material
  After-Acquired Property

  	
   

  
	
   

  	
   

  	
   

  
	
  ARTICLE
  V

  	
   

  
	
   

  	
   

  	
   

  
	
  Successor Company

  	
   

  
	
   

  	
   

  	
   

  
	
  SECTION
  5.01.

  	
  When
  Company May Merge or Transfer Assets

  	
   

  
	
   

  	
   

  	
   

  
	
  ARTICLE
  VI

  	
   

  
	
   

  	
   

  	
   

  
	
  Defaults and Remedies

  	
   

  
	
   

  	
   

  	
   

  
	
  SECTION
  6.01.

  	
  Events
  of Default

  	
   

  
	
  SECTION
  6.02.

  	
  Acceleration

  	
   

  
	
  SECTION
  6.03.

  	
  Other
  Remedies

  	
   

  
	
  SECTION
  6.04.

  	
  Waiver
  of Past Defaults

  	
   

  
	
  SECTION
  6.05.

  	
  Control
  by Majority

  	
   

  
	
  SECTION
  6.06.

  	
  Limitation
  on Suits

  	
   

  
	
  SECTION
  6.07.

  	
  Rights
  of Holders to Receive Payment

  	
   

  
	
  SECTION
  6.08.

  	
  Collection
  Suit by Trustee

  	
   

  
	
  SECTION
  6.09.

  	
  Trustee
  May File Proofs of Claim

  	
   

  
	
  SECTION
  6.10.

  	
  Priorities

  	
   

  
	
  SECTION
  6.11.

  	
  Undertaking
  for Costs

  	
   

  
	
  SECTION
  6.12.

  	
  Waiver
  of Stay or Extension Laws

  	
   

  

 

ii

 

	
  ARTICLE
  VII

  	
   

  
	
   

  	
   

  	
   

  
	
  Trustee

  	
   

  
	
   

  	
   

  	
   

  
	
  SECTION
  7.01.

  	
  Duties
  of Trustee

  	
   

  
	
  SECTION
  7.02.

  	
  Rights
  of Trustee

  	
   

  
	
  SECTION
  7.03.

  	
  Individual
  Rights of Trustee

  	
   

  
	
  SECTION
  7.04.

  	
  Trustee’s
  Disclaimer

  	
   

  
	
  SECTION
  7.05.

  	
  Notice
  of Defaults

  	
   

  
	
  SECTION
  7.06.

  	
  Reports
  by Trustee to Holders

  	
   

  
	
  SECTION
  7.07.

  	
  Compensation
  and Indemnity

  	
   

  
	
  SECTION
  7.08.

  	
  Replacement
  of Trustee

  	
   

  
	
  SECTION
  7.09.

  	
  Successor
  Trustee by Merger

  	
   

  
	
  SECTION
  7.10.

  	
  Eligibility;
  Disqualification

  	
   

  
	
  SECTION
  7.11.

  	
  Preferential
  Collection of Claims Against the Company

  	
   

  
	
   

  	
   

  	
   

  
	
  ARTICLE
  VIII

  	
   

  
	
   

  	
   

  	
   

  
	
  Discharge of Indenture; Defeasance

  	
   

  
	
   

  	
   

  	
   

  
	
  SECTION
  8.01.

  	
  Discharge
  of Liability on Securities; Defeasance

  	
   

  
	
  SECTION
  8.02.

  	
  Conditions
  to Defeasance

  	
   

  
	
  SECTION
  8.03.

  	
  Application
  of Trust Money

  	
   

  
	
  SECTION
  8.04.

  	
  Repayment
  to Company

  	
   

  
	
  SECTION
  8.05.

  	
  Indemnity
  for Government Obligations

  	
   

  
	
  SECTION
  8.06.

  	
  Reinstatement

  	
   

  
	
   

  	
   

  	
   

  
	
  ARTICLE
  IX

  	
   

  
	
   

  	
   

  	
   

  
	
  Amendments

  	
   

  
	
   

  	
   

  	
   

  
	
  SECTION
  9.01.

  	
  Without
  Consent of Holders

  	
   

  
	
  SECTION
  9.02.

  	
  With
  Consent of Holders

  	
   

  
	
  SECTION
  9.03.

  	
  Compliance
  with Trust Indenture Act

  	
   

  
	
  SECTION
  9.04.

  	
  Revocation
  and Effect of Consents and Waivers

  	
   

  
	
  SECTION
  9.05.

  	
  Notation
  on or Exchange of Securities

  	
   

  
	
  SECTION
  9.06.

  	
  Trustee
  to Sign Amendments

  	
   

  
	
   

  	
   

  	
   

  
	
  ARTICLE
  X

  	
   

  
	
   

  	
   

  	
   

  
	
  Collateral and Security

  	
   

  
	
   

  	
   

  	
   

  
	
  SECTION
  10.01.

  	
  Security
  Documents

  	
   

  
	
  SECTION
  10.02.

  	
  Recording
  and Opinions

  	
   

  
	
  SECTION
  10.03.

  	
  Release
  of Collateral

  	
   

  
	
  SECTION
  10.04.

  	
  Certificates
  of the Trustee

  	
   

  

 

iii

 

	
  SECTION
  10.05.

  	
  Authorization
  of Actions to Be Taken by the Trustee Under the Security Documents

  	
   

  
	
  SECTION
  10.06.

  	
  Authorization
  of Receipt of Funds by the Trustee Under the Security Documents

  	
   

  
	
  SECTION
  10.07.

  	
  Termination
  of Security Interest

  	
   

  
	
  SECTION
  10.08.

  	
  Collateral
  Agent

  	
   

  
	
  SECTION
  10.09.

  	
  Designations

  	
   

  
	
   

  	
   

  	
   

  
	
  ARTICLE
  XI

  	
   

  
	
   

  	
   

  	
   

  
	
  Note Guarantees

  	
   

  
	
   

  	
   

  	
   

  
	
  SECTION
  11.01.

  	
  Note
  Guarantees

  	
   

  
	
  SECTION
  11.02.

  	
  Limitation
  on Liability

  	
   

  
	
  SECTION
  11.03.

  	
  Releases
  of Note Guarantees

  	
   

  
	
  SECTION
  11.04.

  	
  Successors
  and Assigns

  	
   

  
	
  SECTION
  11.05.

  	
  No
  Waiver

  	
   

  
	
  SECTION
  11.06.

  	
  Modification

  	
   

  
	
  SECTION
  11.07.

  	
  Execution
  of Supplemental Indenture for Future Note Guarantors

  	
   

  
	
  SECTION
  11.08.

  	
  Non-Impairment

  	
   

  
	
   

  	
   

  	
   

  
	
  ARTICLE
  XII

  	
   

  
	
   

  	
   

  	
   

  
	
  Miscellaneous

  	
   

  
	
   

  	
   

  	
   

  
	
  SECTION
  12.01.

  	
  Trust
  Indenture Act Controls

  	
   

  
	
  SECTION
  12.02.

  	
  Notices

  	
   

  
	
  SECTION
  12.03.

  	
  Communication
  by Holders with Other Holders

  	
   

  
	
  SECTION
  12.04.

  	
  Certificate
  and Opinion as to Conditions Precedent

  	
   

  
	
  SECTION
  12.05.

  	
  Statements
  Required in Certificate or Opinion

  	
   

  
	
  SECTION
  12.06.

  	
  When
  Securities Disregarded

  	
   

  
	
  SECTION
  12.07.

  	
  Rules
  by Trustee, Paying Agent and Registrar

  	
   

  
	
  SECTION
  12.08.

  	
  Legal
  Holidays

  	
   

  
	
  SECTION
  12.09.

  	
  GOVERNING
  LAW

  	
   

  
	
  SECTION
  12.10.

  	
  No
  Recourse Against Others

  	
   

  
	
  SECTION
  12.11.

  	
  Successors

  	
   

  
	
  SECTION
  12.12.

  	
  Multiple
  Originals

  	
   

  
	
  SECTION
  12.13.

  	
  Table
  of Contents; Headings

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
  Appendix A

  	
  -

  	
  Provisions
  Relating to Original Securities, Additional Securities, Private Exchange
  Notes and Exchange Notes

  	
   

  
	
  Exhibit A

  	
  -

  	
  Form of
  Initial Security and Private Exchange Note

  	
   

  
	
  Exhibit B

  	
  -

  	
  Form of Exchange
  Note

  	
   

  
	
  Exhibit C

  	
  -

  	
  Form of
  Supplemental Indenture

  	
   

  
	
  Exhibit D

  	
  -

  	
  Form of
  Transferee Letter of Representation

  	
   

  

 

iv

 

INDENTURE dated as of
February 17, 2004,  among PLIANT
CORPORATION, a Utah corporation (the “Company”), PLIANT CORPORATION
INTERNATIONAL, a Utah corporation, PLIANT FILM PRODUCTS OF MEXICO, INC., a Utah
corporation, PLIANT SOLUTIONS CORPORATION, a Utah corporation, PLIANT PACKAGING
OF CANADA, LLC, a Utah limited liability company, UNIPLAST HOLDINGS INC., a
Delaware corporation, UNIPLAST U.S., INC., a Delaware corporation, PIERSON
INDUSTRIES, INC., a Massachusetts corporation, TUREX, INC., a Rhode Island
corporation, UNIPLAST MIDWEST, INC., an Indiana corporation and UNIPLAST
INDUSTRIES CO., a Canadian corporation (collectively, the “Note Guarantors”)
and WILMINGTON TRUST COMPANY, a Delaware banking corporation, as trustee (the
“Trustee”).

 

Each party
agrees as follows for the benefit of the other parties and for the equal and
ratable benefit of the Holders of (a) the Company’s 111/8%
Senior Secured Discount Notes due 2009 issued on the date hereof (the “Original
Securities”), (b) any Additional Securities (as defined herein) that may be
issued on any Issue Date (all such Securities in clauses (a) and (b) being
referred to collectively as the “Initial Securities”), (c) if and when
issued as provided in the Registration Agreement (as defined in Appendix A
hereto (the “Appendix”)), the Company’s 111/8% Senior
Secured Discount Notes due 2009 issued in the Registered Exchange Offer (as
defined in the Appendix) in exchange for any Initial Securities (the “Exchange
Notes”) and (d) if and when issued as provided in the Registration
Agreement, the Private Exchange Notes (as defined in the Appendix; the Private
Exchange Notes, together with the Initial Securities and any Exchange Notes
issued hereunder, the “Securities”) issued in the Private Exchange.  On the date hereof, $306,000,000 in
aggregate principal amount at maturity of the Original Securities will
initially be issued.  Subject to the
conditions and in compliance with the covenants set forth herein, the Company
may issue an unlimited aggregate principal amount of Additional Securities from
time to time.

 

 

ARTICLE I

 

Definitions and Incorporation by Reference

 

SECTION 1.01. 
Definitions.

 

“Accreted
Value” as of any date (the “Specified Date”) means, with respect to each $1,000
principal amount at maturity of the Securities (subject to the latest sentence
of this definition):

 

(i) if the Specified Date is one of the following dates (each a
“Semi-Annual Accretion Date”), the amount set forth opposite each date below: 

 

	
  Semi-Annual Accretion Date

  	
   

  	
  Accreted
  Value

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  Issue Date

  	
   

  	
  $

  	
  736.27

  	
   

  
	
  June 15, 2004

  	
   

  	
  $

  	
  762.87

  	
   

  
	
  December 15, 2004

  	
   

  	
  $

  	
  805.31

  	
   

  
	
  June 15, 2005

  	
   

  	
  $

  	
  850.10

  	
   

  
	
  December 15, 2005

  	
   

  	
  $

  	
  897.39

  	
   

  
	
  June 15, 2006

  	
   

  	
  $

  	
  947.31

  	
   

  
	
  December 15, 2006

  	
   

  	
  $

  	
  1,000.00

  	
   

  

 

 

(ii) if the
Specified Date occurs between two Semi-Annual Accretion Dates, the sum of
(a) the Accreted Value for the Semi-Annual Accretion Date immediately
preceding the Specified Date and (b) an amount equal to the product of
(x) the Accreted Value for the immediately following Semi-Annual Accretion
Date less the Accreted Value of the immediately preceding Semi-Annual Accretion
Date and (y) the fraction, the numerator of which is the number of days
actually elapsed from the immediately preceding Semi-Annual Accretion Date and
the denominator of which is 180; or

 

(iii) if the Specified Date is after December 15, 2006, $1,000.

 

For the purposes
hereof, if the Specified Date is prior to December 15, 2006 but on or
after the date on which the Company elects to commence to pay cash interest
(the “Cash Election Date”), all references in this document to Accreted Value
in respect of any Security shall be to the aggregate principal amount of such
Security, which shall be equal to the Accreted Value of the such Security as of
the Cash Election Date determined in accordance with clauses (i) and
(ii) above.  If Additional Interest
is payable with respect to any Security prior to the earlier of (A) the
Cash Election Date and (B) December 15, 2006, the Accreted Value of
such Security shall be increased to reflect such Additional Interest.

 

“Additional
Assets” means (a) any property or assets (other than Indebtedness and
Capital Stock) to be used by the Company or a Restricted Subsidiary in a
Permitted Business or any improvements to any property or assets that are used
by the

 

2

 

Company or a Restricted Subsidiary
in a Permitted Business; (b) Capital Stock of a Person that becomes a
Restricted Subsidiary as a result of the acquisition of such Capital Stock by
the Company or another Restricted Subsidiary; or (c) Capital Stock
constituting a minority interest in any Person that at such time is a
Restricted Subsidiary; provided, however, that any such
Restricted Subsidiary described in clauses (b) or (c) above is
primarily engaged in a Permitted Business.

 

“Additional
Interest” means any additional interest or liquidated damages payable under the
Registration Agreement.

 

“Additional
Securities” means any 111/8% Senior Secured Discount
Notes due 2009, issued under the terms of this Indenture subsequent to the
Closing Date (other than the Exchange Notes or the Private Exchange Notes
issued in exchange for Original Securities).

 

“Affiliate” of
any specified Person means any other Person, directly or indirectly,
controlling or controlled by or under direct or indirect common control with
such specified Person.  For the purposes
of this definition, “control” when used with respect to any Person means the
power to direct the management and policies of such Person, directly or
indirectly, whether through the ownership of voting securities, by contract or
otherwise; and the terms “controlling” and “controlled” have meanings
correlative to the foregoing.  For
purposes of Sections 4.06 and 4.07 only, “Affiliate” shall also mean any
beneficial owner of shares representing 10% or more of the total voting power
of the Voting Stock (on a fully diluted basis) of the Company or of rights or
warrants to purchase such Voting Stock (whether or not currently exercisable)
and any Person who would be an Affiliate of any such beneficial owner pursuant
to the first sentence hereof.

 

“Asset
Disposition” means any sale, lease (other than an operating lease entered into
in the ordinary course of business), transfer or other disposition (or series
of related sales, leases, transfers or dispositions) by the Company or any
Restricted Subsidiary, including any disposition by means of a merger,
consolidation or similar transaction (each referred to for the purposes of this
definition as a “disposition”), of (a) any shares of Capital Stock of a
Restricted Subsidiary (other than directors’ qualifying shares or shares
required by applicable law to be held by a Person other than the Company or a
Restricted Subsidiary), (b) all or substantially all the assets of any
division or line of business of the Company or any Restricted Subsidiary or (c) any
other assets of the Company or any Restricted Subsidiary outside of the
ordinary course of business of the Company or such Restricted Subsidiary (other
than, in the case of (a), (b) and (c) above, (i) a disposition
by a Restricted Subsidiary to the Company or by the Company or a Restricted
Subsidiary to a Wholly Owned Subsidiary, (ii) for purposes of
Section 4.06 only, the making of a Permitted Investment or a disposition
that constitutes a Restricted Payment permitted by Section 4.04, (iii) sales
of accounts receivable and related assets (including contract rights) of the
type specified in the definition of “Qualified Securitization Transaction” to a
Securitization Entity for the fair market value thereof, (iv) other than with
respect to assets that constitute First-Priority Collateral, a disposition of
obsolete or worn out property or equipment or property or equipment that

 

3

 

is no longer used or useful in
the conduct of business of the Company and its Restricted Subsidiaries, (v) any
other disposition of assets with a fair market value, as conclusively
determined by senior management of the Company in good faith, of less than $1.0
million, (vi) sales or grants of licenses to use the Company’s or any Restricted
Subsidiary’s patents, trade secrets, know-how and technology to the extent that
such license does not prohibit the licensor from using the patent, trade
secret, know-how or technology or require the licensor to pay any fees for such
use, (vii) the disposition of all or substantially all of the assets of the
Company in compliance with Section 5.01 and (viii) the disposition of
any Capital Stock or other ownership interest in or assets or property of an
Unrestricted Subsidiary.

 

“Attributable
Debt” in respect of a Sale/Leaseback Transaction means, as at the time of
determination, the present value (discounted at the interest rate borne by the
Securities, compounded annually) of the total obligations of the lessee for
rental payments during the remaining term of the lease included in such
Sale/Leaseback Transaction (including any period for which such lease has been
extended).

 

“Average Life”
means, as of the date of determination, with respect to any Indebtedness or
Preferred Stock, the quotient obtained by dividing (a) the sum of the
products of the numbers of years from the date of determination to the dates of
each successive scheduled principal payment of such Indebtedness or scheduled
redemption or similar payment with respect to such Preferred Stock multiplied
by the amount of such payment by (b) the sum of all such payments.

 

“Bank
Indebtedness” means any and all amounts payable under or in respect of the
Credit Agreement, including principal, premium (if any), interest (including
interest accruing on or after the filing of any petition in bankruptcy or for
reorganization relating to the Company or any Subsidiary whether or not a claim
for post-filing interest is allowed in such proceedings), fees, charges,
expenses, reimbursement obligations, guarantees and all other amounts payable
thereunder or in respect thereof.

 

“Board of
Directors” means the Board of Directors of the Company or any committee thereof
duly authorized to act on behalf of the Board of Directors of the Company.

 

“Business Day”
means each day which is not a Legal Holiday.

 

“Canadian
Pledge Agreement” means the Pledge Agreement dated as of the Closing Date,
among the Company, Uniplast Industries Co. and the Collateral Agent, as such
agreement may be amended, modified, supplemented or restated from time to time.

 

“Canadian
Security Agreement” means the Security Agreement dated as of the Closing Date,
among the Company, Uniplast Industries Co. and the Collateral Agent, as such
agreement may be amended, modified, supplemented or restated from time to time.

 

4

 

“Capitalized
Lease Obligations” means an obligation that is required to be classified and
accounted for as a capitalized lease for financial reporting purposes in
accordance with GAAP, and the amount of Indebtedness represented by such
obligation shall be the capitalized amount of such obligation determined in
accordance with GAAP; and the Stated Maturity thereof shall be the date of the
last payment of rent or any other amount due under such lease prior to the
first date upon which such lease may be prepaid by the lessee without payment
of a penalty.

 

“Capital
Stock” of any Person means any and all shares, interests, rights to purchase,
warrants, options, participations or other equivalents of or interests in
(however designated) equity of such Person, including any Preferred Stock, but
excluding any debt securities convertible into such equity.

 

“Change of
Control” means the occurrence of any of the following events:

 

(a) prior to the first public offering of common stock of the Company,
the Permitted Holders cease to be the “beneficial owner” (as defined in
Rules 13d-3 and 13d-5 under the Exchange Act), directly or indirectly, of
a majority in the aggregate of the total voting power of the Voting Stock of
the Company, whether as a result of issuance of securities of the Company, any
merger, consolidation, liquidation or dissolution of the Company, any direct or
indirect transfer of securities by any Permitted Holder or otherwise (for
purposes of this clause (a) and clause (b) below, the Permitted
Holders shall be deemed to beneficially own any Voting Stock of an entity (the
“specified entity”) held by any other entity (the “parent entity”) so long as
the Permitted Holders beneficially own (as so defined), directly or indirectly,
in the aggregate a majority of the voting power of the Voting Stock of the
parent entity);

 

(b) (i) any “person” (as such term is used in Sections 13(d)
and 14(d) of the Exchange Act, including any group acting for the purpose of
acquiring, holding or disposing of securities within the meaning of
Rule 13d-5(b)(1) under the Exchange Act), other than one or more Permitted
Holders, is or becomes the beneficial owner (as defined in clause (a)
above, except that for purposes of this clause (b) a person (including a
Permitted Holder) shall be deemed to have “beneficial ownership” of all shares
that any such person has the right to acquire, whether such right is
exercisable immediately, only after the passage of time, upon the happening of
any event or otherwise), directly or indirectly, of more than 50% of the total
voting power of the Voting Stock of the Company and (ii) the Permitted
Holders “beneficially own” (as defined in clause (a) above), directly or
indirectly, in the aggregate a lesser percentage of the total voting power of
the Voting Stock of the Company than such other person and do not have the
right or ability by voting power, contract or otherwise to elect or designate
for election a majority of the Board of Directors of the Company (for the
purposes of this clause (b), such other person shall be deemed to
beneficially own any Voting Stock of a specified entity held by a parent
entity, if such other person is the beneficial owner (as defined in this clause (b)),
directly or indirectly, of more than 50% of the voting power of the Voting
Stock of such parent entity and the

 

5

 

Permitted
Holders “beneficially own” (as defined in clause (a) above), directly or
indirectly, in the aggregate a lesser percentage of the voting power of the
Voting Stock of such parent entity and do not have the right or ability by
voting power, contract or otherwise to elect or designate for election a
majority of the Board of Directors of such parent entity);

 

(c) during any period of two consecutive years, individuals who at the
beginning of such period constituted the Board of Directors of the Company
(together with any new directors (i) selected in accordance with the
Stockholders Agreement so long as such agreement is in effect or otherwise
nominated by the Permitted Holders or (ii) whose election by the Board of
Directors of the Company or whose nomination for election by the stockholders
of the Company was approved by a vote of at least a majority of the members of
the Board of Directors of the Company, 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 by the Board of Directors or in accordance
with the Stockholders Agreement or otherwise by the Permitted Holders) cease
for any reason to constitute a majority of the Board of Directors of the
Company then in office;

 

(d) the adoption of a plan relating to the liquidation or dissolution
of the Company; or

 

(e) the merger or consolidation of the Company with or into another
Person or the merger of another Person with or into the Company, or the sale of
all or substantially all the assets of the Company to another Person (other
than a Person that is controlled by the Permitted Holders), and, in the case of
any such merger or consolidation, the securities of the Company that are
outstanding immediately prior to such transaction and which represent 100% of
the aggregate voting power of the Voting Stock of the Company are changed into
or exchanged for cash, securities or property, unless pursuant to such
transaction such securities are changed into or exchanged for, in addition to
any other consideration, securities of the surviving Person or transferee that
represent immediately after such transaction, at least a majority of the
aggregate voting power of the Voting Stock of the surviving Person or
transferee.

 

“Closing Date”
means the date of this Indenture.

 

“Code” means
the Internal Revenue Code of 1986, as amended.

 

“Collateral”
means the First-Priority Collateral and the Second-Priority Collateral.

 

“Collateral
Agent” means the Trustee in its capacity as the “Collateral Agent” under and as
defined in the Security Documents and any successor thereto in such capacity.

 

6

 

“Commodity
Agreement” means any commodity futures contract, commodity option or other
similar agreement or arrangement entered into by the Company or any of its
Subsidiaries designed to protect the Company or any of its Subsidiaries against
fluctuations in the price of commodities actually at the time used in the
ordinary course of business of the Company or its Subsidiaries.

 

“Common
Collateral Agent” means a bank or trust company authorized to exercise
corporate trust powers that has been appointed by the Company, and has agreed,
to act as collateral agent for the equal and ratable benefit of both the
holders of obligations secured by the Second-Priority Liens Securing Note
Obligations and the holders of all other obligations secured by Liens Securing
Secondary Collateral Obligations, in its capacity as such collateral agent.

 

“Company”
means the party named as such in this Indenture until a successor replaces it
and, thereafter, means the successor and, for purposes of any provision
contained herein and required by the TIA, each other obligor on the indenture
securities.

 

“Consolidated
Coverage Ratio” as of any date of determination means the ratio of (a) the
aggregate amount of EBITDA for the period of the most recent four consecutive
fiscal quarters for which financial statements are publicly available ending
prior to the date of such determination to (b) Consolidated Interest
Expense for such four fiscal quarters; provided, however, that
(i) if the Company or any Restricted Subsidiary has Incurred any
Indebtedness since the beginning of such period that remains outstanding on
such date of determination or if the transaction giving rise to the need to
calculate the Consolidated Coverage Ratio is an Incurrence of Indebtedness,
EBITDA and Consolidated Interest Expense for such period shall be calculated
after giving effect on a pro forma basis to such Indebtedness as if such
Indebtedness had been Incurred on the first day of such period and the
discharge of any other Indebtedness repaid, repurchased, defeased or otherwise
discharged with the proceeds of such new Indebtedness as if such discharge had
occurred on the first day of such period, (ii) if the Company or any
Restricted Subsidiary has repaid, repurchased, defeased or otherwise discharged
any Indebtedness since the beginning of such period or if any Indebtedness is
to be repaid, repurchased, defeased or otherwise discharged (in each case other
than Indebtedness Incurred under any revolving credit facility unless such
Indebtedness has been permanently repaid and has not been replaced) on the date
of the transaction giving rise to the need to calculate the Consolidated
Coverage Ratio, EBITDA and Consolidated Interest Expense for such period shall
be calculated on a pro forma basis as if such discharge had occurred on the
first day of such period and as if the Company or such Restricted Subsidiary
has not earned the interest income actually earned during such period in
respect of cash or Temporary Cash Investments used to repay, repurchase,
defease or otherwise discharge such Indebtedness, (iii) if since the
beginning of such period the Company or any Restricted Subsidiary shall have
made any Asset Disposition in excess of $10.0 million which constitutes
all or substantially all of an operating unit of a business, the EBITDA for
such period shall be reduced by an amount equal to the EBITDA (if positive)
directly attributable to the assets that are the subject of such Asset
Disposition for such period or increased by an amount equal to the EBITDA (if
negative)

 

7

 

directly attributable thereto
for such period and Consolidated Interest Expense for such period shall be
reduced by an amount equal to the Consolidated Interest Expense directly
attributable to any Indebtedness of the Company or any Restricted Subsidiary
repaid, repurchased, defeased or otherwise discharged with respect to the
Company and its continuing Restricted Subsidiaries in connection with such
Asset Disposition for such period (or, if the Capital Stock of any Restricted
Subsidiary is sold, the Consolidated Interest Expense for such period directly
attributable to the Indebtedness of such Restricted Subsidiary to the extent
the Company and its continuing Restricted Subsidiaries are no longer liable for
such Indebtedness after such sale), (iv) if since the beginning of such
period the Company or any Restricted Subsidiary (by merger or otherwise) shall
have made an Investment in any Restricted Subsidiary (or any Person that
becomes a Restricted Subsidiary or is merged with and into the Company) or an
acquisition of assets, including any acquisition of assets occurring in
connection with a transaction causing a calculation to be made hereunder, which
constitutes all or substantially all of an operating unit of a business, EBITDA
and Consolidated Interest Expense for such period shall be calculated after
giving pro forma effect thereto (including the Incurrence of any Indebtedness)
as if such Investment or acquisition occurred on the first day of such period
and (v) if since the beginning of such period any Person (that
subsequently became a Restricted Subsidiary or was merged with or into the
Company or any Restricted Subsidiary since the beginning of such period) shall
have made any Asset Disposition or any Investment or acquisition of assets that
would have required an adjustment pursuant to clause (iii) or (iv) above
if made by the Company or a Restricted Subsidiary during such period, EBITDA
and Consolidated Interest Expense for such period shall be calculated after
giving pro forma effect thereto as if such Asset Disposition, Investment or
acquisition of assets occurred on the first day of such period.  For purposes of this definition, whenever
pro forma effect is to be given to an Investment or acquisition of assets, the
amount of income or earnings relating thereto and the amount of Consolidated
Interest Expense associated with any Indebtedness Incurred in connection
therewith, the pro forma calculations shall be determined in good faith by a
responsible financial or accounting Officer of the Company.  Any such pro forma calculations may
include operating expense reductions for such period resulting from the
acquisition which is being given pro forma effect that (a) would be
permitted pursuant to Article 11 of Regulation S-X under the
Securities Act or (b) have been realized or for which the steps necessary
for realization have been taken or are reasonably expected to be taken within
six months following any such acquisition, including, but not limited to, the
execution or termination of any contracts, the termination of any personnel or
the closing (or approval by the Board of Directors of any closing) of any
facility, as applicable, provided that, such adjustments are set forth
in an Officers’ Certificate signed by the Company’s chief financial officer and
another Officer which states (i) the amount of such adjustment or
adjustments, (ii) that such adjustment or adjustments are based on the
reasonable good faith beliefs of the officers executing such Officers’
Certificate at the time of such execution and (iii) that any related
Incurrence of Indebtedness is permitted pursuant to this Indenture.  If any Indebtedness bears a floating rate of
interest and is being given pro forma effect, the interest expense on such
Indebtedness shall be calculated as if the rate in effect on the date of
determination had been the applicable rate for the entire period (taking into
account any Interest Rate Agreement or Currency

 

8

 

Agreement applicable to such
Indebtedness if such Interest Rate Agreement or Currency Agreement has a
remaining term as at the date of determination in excess of 12 months).

 

“Consolidated
Interest Expense” means, for any period, the total interest expense of the
Company and its Consolidated Restricted Subsidiaries plus, to the extent
Incurred by the Company and its Restricted Subsidiaries in such period but not
included in such interest expense, (a) interest expense attributable to
Capitalized Lease Obligations and the interest expense attributable to
operating leases constituting part of a Sale/Leaseback Transaction,
(b) amortization of debt discount and debt issuance costs, (c) capitalized
interest, (d) non-cash interest expense, (e) commissions, discounts
and other fees and charges attributable to letters of credit and bankers’
acceptance financing, (f) interest accruing on any Indebtedness of any
other Person to the extent such Indebtedness is Guaranteed by the Company or
any Restricted Subsidiary, (g) net costs associated with Hedging
Obligations (including amortization of fees), provided, however,
that if Hedging Obligations result in net benefits rather than costs, such
benefits shall be credited in determining Consolidated Interest Expense unless,
pursuant to GAAP, such net benefits are otherwise reflected in Consolidated Net
Income, (h) dividends and distributions declared in respect of all
Disqualified Stock of the Company and dividends and distributions declared and
paid in respect of all Preferred Stock of any of the Subsidiaries of the
Company that is not a Note Guarantor, to the extent held by Persons other than
the Company or a Wholly Owned Subsidiary, (i) interest Incurred in
connection with investments in discontinued operations and (j) the cash
contributions to any employee stock ownership plan or similar trust to the
extent such contributions are used by such plan or trust to pay interest or
fees to any Person (other than the Company) in connection with Indebtedness
Incurred by such plan or trust. 
Notwithstanding anything to the contrary contained herein, commissions,
discounts, yield and other fees and charges Incurred in connection with any
transaction pursuant to which the Company or any Subsidiary of the Company may
sell, convey or otherwise transfer or grant a security interest in any accounts
receivable or related assets shall be included in Consolidated Interest
Expense.

 

“Consolidated
Net Income” means, for any period, the net income (loss) of the Company and its
Consolidated Subsidiaries for such period; provided, however,
that there shall not be included in such Consolidated Net Income:

 

(a) any net
income (loss) of any Person (other than the Company) if such Person is not a
Restricted Subsidiary, except that (i) subject to the limitations
contained in clauses (d), (e) and (f) below, the Company’s
equity in the net income of any such Person for such period shall be included
in such Consolidated Net Income up to the aggregate amount of cash actually
distributed by such Person during such period to the Company or a Restricted
Subsidiary as a dividend or other distribution (subject, in the case of a
dividend or other distribution made to a Restricted Subsidiary, to the limitations
contained in clause (c) below) and (ii) the Company’s equity in a net
loss of any such Person for such period shall be included in determining such
Consolidated Net Income to the extent such loss has been funded with cash from
the Company or a Restricted Subsidiary;

 

9

 

(b) other than
for purposes of clauses (iv) and (v) of the definition of
Consolidated Coverage Ratio any net income (or loss) of any Person acquired by
the Company or a Subsidiary in a pooling of interests transaction for any
period prior to the date of such acquisition;

 

(c) any net
income (or loss)  of any Restricted
Subsidiary if such Restricted Subsidiary is subject to restrictions, directly
or indirectly, on the payment of dividends or the making of distributions or
loans or intercompany advances by such Restricted Subsidiary, directly or
indirectly, to the Company, except that (i) subject to the limitations
contained in clauses (d), (e) and (f) below, the Company’s
equity in the net income of any such Restricted Subsidiary for such period
shall be included in such Consolidated Net Income up to the aggregate amount of
cash actually distributed, loaned or advanced by such Restricted Subsidiary
during such period to the Company or another Restricted Subsidiary as a
dividend, distribution, loan or advance (subject, in the case of a dividend,
distribution, loan or advance made to another Restricted Subsidiary, to the
limitation contained in this clause) and (ii) the Company’s equity in a
net loss of any such Restricted Subsidiary for such period shall be included in
determining such Consolidated Net Income;

 

(d) any gain
(loss) realized upon the sale or other disposition of any asset of the Company
or its Consolidated Subsidiaries (including pursuant to any Sale/Leaseback
Transaction) that is not sold or otherwise disposed of in the ordinary course
of business and any gain (loss) realized upon the sale or other disposition of
any Capital Stock of any Person;

 

(e) any
extraordinary gain or loss; and

 

(f) the
cumulative effect of a change in accounting principles.

 

Notwithstanding
the foregoing, for the purposes of Section 4.04 only, there shall be
excluded from Consolidated Net Income any dividends, repayments of loans or
advances or other transfers of assets from Unrestricted Subsidiaries to the
Company or a Restricted Subsidiary to the extent such dividends, repayments or
transfers increase the amount of Restricted Payments permitted under such
Section pursuant to clause (a)(iv)(C)(vi) thereof.

 

“Consolidation”
means the consolidation of the amounts of each of the Restricted Subsidiaries
with those of the Company in accordance with GAAP consistently applied; provided,
however, that “Consolidation” shall not include consolidation of the accounts
of any Unrestricted Subsidiary, but the interest of the Company or any
Restricted Subsidiary in an Unrestricted Subsidiary shall be accounted for as
an investment.  The term “Consolidated”
has a correlative meaning.

 

“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 Rodney Square North, 1100 North Market Street, Wilmington,

 

10

 

DE 19890-0001, Attention:
Corporate Trust Administration, or such other address as the Trustee may
designate from time to time by notice to the Holders and the Issuer, or the
principal corporate trust office of any successor Trustee (or such other
address as a successor Trustee may designate from time to time by notice to the
Holders and the Company).

 

“Credit Agent”
means Deutsche Bank Trust Company Americas, in its capacity as collateral agent
for the lenders party to the Credit Agreement or any successor thereto, or any
Person otherwise designated the “Credit Agent” pursuant to the Intercreditor
Agreement.

 

“Credit
Agreement” means the credit agreement dated as of the Closing Date, among the
Company, Uniplast Industries Co., the financial institutions party thereto as
lenders, Credit Suisse First Boston, acting through its Cayman Islands Branch,
as administrative agent, Deutsche Bank Trust Company Americas, as collateral
agent, and JPMorgan Chase Bank, as syndication agent, together with related
documents thereto including any guarantee agreements and security documents, as
amended, modified, supplemented, restated, renewed, refunded, replaced,
restructured, repaid or refinanced from time to time (including any agreement
extending the maturity thereof or increasing the amount of available borrowings
thereunder or adding Restricted Subsidiaries of the Company as additional
borrowers or guarantors thereunder) whether with the original agents and
lenders or otherwise and whether provided under the original credit agreement
or other credit agreements or otherwise.

 

“Credit
Agreement Obligations” means (i) all Bank Indebtedness and all other
Indebtedness outstanding under one or more of any other First-Lien Credit
Facilities that constitutes Permitted Debt  or is otherwise permitted pursuant to
Section 4.03 and that is designated by the Company as “Credit Agreement
Obligations” for purposes of this Indenture and is secured by a Permitted Lien
described in clause (a)(2) of the definition thereof, (ii) all other
obligations (not constituting Indebtedness) of the Company or any Note
Guarantor under the Credit Agreement or any such other First-Lien Credit
Facility and (iii) all other obligations of the Company or any Note
Guarantor in respect of Hedging Obligations or obligations in respect of cash
management services that are designated by the Company to be “Credit Agreement
Obligations” for purposes of this Indenture. Notwithstanding anything to the
contrary in the previous sentence, any Indebtedness and other obligations
Incurred under the Credit Agreement or otherwise shall be deemed to constitute
Credit Agreement Obligations if the holders of such Indebtedness or other
obligations or their agent or representative shall have received a written
representation from the Company in, or in connection with, the Credit Agreement
or other agreement governing such Indebtedness or other obligations that such
Indebtedness constitutes, Credit Agreement Obligations (whether or not such
Indebtedness is at any time determined not to have been permitted to be
Incurred under this Indenture).

 

“Credit
Facilities” means one or more (i) debt facilities (including, without
limitation, the Credit Agreement) or commercial paper facilities, providing for
revolving credit loans, term loans, receivables financing (including through
the sale of receivables

 

11

 

to lenders or to special
purpose entities formed to borrow from lenders against such receivables) or
letters of credit, (ii) debt securities, indentures or other forms of debt
financing (including convertible or exchangeable debt instruments) or (iii)
instruments or agreements evidencing any other Indebtedness, in each case, as
amended, supplemented, modified, extended, renewed, restated or refunded in
whole or in part from time to time.

 

“Currency
Agreement” means with respect to any Person any foreign exchange contract,
currency swap agreements or other similar agreement or arrangement to which
such Person is a party or of which it is a beneficiary.

 

“Default”
means any event which is, or after notice or passage of time or both would be,
an Event of Default.

 

“Discharge of
Credit Agreement Obligations” means payment in full in cash of the principal of
and interest and premium, if any, on all Indebtedness outstanding under the
First-Lien Credit Facilities or, with respect to Hedging Obligations or letters
of credit outstanding thereunder, delivery of cash collateral or backstop
letters of credit in respect thereof in compliance with such First-Lien Credit
Facility, in each case after or concurrently with termination of all
commitments to extend credit thereunder, and payment in full of any other
Credit Agreement Obligations that are due and payable or otherwise accrued and
owing at or prior to the time such principal, interest and premium, if any, are
paid.

 

“Disqualified
Stock” means, with respect to any Person, any Capital Stock of such Person
which by its terms (or by the terms of any security into which it is
convertible or for which it is exchangeable or exercisable) or upon the
happening of any event (a) matures or is mandatorily redeemable pursuant
to a sinking fund obligation or otherwise, (b) is convertible or
exchangeable for Indebtedness or Disqualified Stock (excluding Capital Stock
convertible or exchangeable solely at the option of the Company or a Restricted
Subsidiary, provided, that any such conversion or exchange shall be
deemed an issuance of Indebtedness or an issuance of Disqualified Stock, as
applicable) or (c) is redeemable at the option of the holder thereof, in
whole or in part, in the case of clauses (a), (b) and (c), on or prior to
91 days after the Stated Maturity of the Securities; provided, however,
that only the portion of Capital Stock that so matures or is mandatorily
redeemable, is so convertible or exchangeable or is so redeemable at the option
of the holder thereof prior to such date will be deemed Disqualified Stock; provided
further, that any Capital Stock that would not constitute Disqualified
Stock but for provisions thereof giving holders thereof the right to require
such Person to repurchase or redeem such Capital Stock upon the occurrence of
an “asset sale” or “change of control” shall not constitute Disqualified Stock
if the “asset sale” or “change of control” provisions applicable to such
Capital Stock provide that such Person may not repurchase or redeem such
Capital Stock pursuant to such provisions unless such Person has first complied
with the provisions of Sections 4.06 and 4.08, as applicable; and provided
further that any class of Capital Stock of such Person that, by its terms,
authorizes such Person to satisfy in full its obligations with respect to
payment of dividends or upon maturity, redemption (pursuant to a sinking fund
or otherwise) or repurchase thereof or other payment obligations or otherwise
by delivery of Capital Stock

 

12

 

that is not Disqualified Stock,
and that is not convertible, puttable or exchangeable for Disqualified Stock or
Indebtedness, shall not be deemed Disqualified Stock so long as such Person
satisfies its obligations with respect thereto solely by the delivery of
Capital Stock that is not Disqualified Stock.

 

“Domestic
Overdraft Facility” means an overdraft line of credit in a maximum principal
amount of $10.0 million at any time outstanding.

 

“Domestic
Subsidiary” means any Restricted Subsidiary of the Company other than a Foreign
Subsidiary.

 

“EBITDA” for
any period means the Consolidated Net Income for such period, excluding the
following to the extent included in calculating such Consolidated Net
Income:  (a) income tax expense of
the Company and its Consolidated Restricted Subsidiaries, (b) Consolidated
Interest Expense, (c) depreciation expense of the Company and its
Consolidated Restricted Subsidiaries, (d) amortization expense of the
Company and its Consolidated Restricted Subsidiaries (but excluding
amortization expense attributable to a prepaid cash item that was paid in a
prior period), (e) other noncash charges of the Company and its
Consolidated Restricted Subsidiaries (excluding any such noncash charge to the
extent that it represents an accrual of or reserve for cash expenditures in any
future period), (f) income or loss from discontinued operations,
(g) plant closing costs (as defined by GAAP) and (h) noncash
stock-based compensation expense. 
Notwithstanding the foregoing, the provision for taxes based on the
income or profits of, and the depreciation and amortization and noncash charges
of, a Restricted Subsidiary of the Company shall be added to Consolidated Net
Income to compute EBITDA only to the extent (and in the same proportion) that
the net income (loss) of such Restricted Subsidiary was included in calculating
Consolidated Net Income and only if a corresponding amount would be permitted
at the date of determination to be dividended, loaned or advanced to the
Company by such Restricted Subsidiary without prior approval of Persons other
than the Board of Directors or holders of the Company’s Capital Stock (that has
not been obtained), pursuant to the terms of its charter and all agreements,
instruments, judgments, decrees, orders, statutes, rules and governmental
regulations applicable to such Restricted Subsidiary or its stockholders.

 

“Equity Offering”
means any public or private sale of the common stock of the Company, other than
any public offering with respect to the Company’s common stock registered on
Form S-8 or other issuances upon exercise of options by employees of the
Company or any of its Restricted Subsidiaries.

 

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

 

“Exchange Note
Guarantees” means the guarantees made by the Note Guarantors pursuant to the
Registration Agreement.

 

“Excluded
Contribution” means net cash proceeds received by the Company from
(a) contributions to its common equity capital and (b) the sale
(other than to a Subsidiary of the Company or to any Company or Subsidiary
management equity

 

13

 

plan or stock option plan or
any other management or employee benefit plan or agreement) of Capital Stock
(other than Disqualified Stock) of the Company, in each case designated as
Excluded Contributions pursuant to an Officers’ Certificate executed on the
date such capital contributions are made or the date such Capital Stock is
sold, as the case may be, which are excluded from the calculation set forth in
Section 4.04(a)(iv)(3).

 

“Existing
Management Stockholders” means each of Harold C. Bevis, R. David
Corey, Brian E. Johnson, Len Azzaro and Stanley B. Bikulege.

 

“First-Lien
Credit Facilities” means (x) the Credit Facilities provided pursuant to the
Credit Agreement and (y) any other Credit Facility that, in the case of both
clauses (x) and (y), is secured by a Permitted Lien described in clause (a)(2)
of the definition thereof and, except for the Credit Facilities provided
pursuant to the senior bank facilities existing on the Closing Date, is
designated by the Company as a “First-Lien Credit Facility” for the purposes of
this Indenture.

 

“First-Priority
Assets” means real property, fixtures and equipment (including any leasehold
interest therein) and the Other First-Priority Assets.

 

“First-Priority
Collateral” means any and all of the following assets and properties now owned
or at any time hereafter acquired by the Company or any Note Guarantor and with
respect to which a Lien is granted as security for the First-Priority
Obligations: (a) all First-Priority Assets, (b) the Notes Collateral
Account, (c) all books and records relating to the foregoing and
(d) all Proceeds of any and all of the foregoing.

 

“First-Priority
Obligations” means the Notes Obligations and the Other First-Priority
Obligations.

 

“Foreign
Subsidiary” means any Restricted Subsidiary of the Company organized, and
conducting its principal operations, outside the United States of America.

 

“Foreign
Subsidiary Asset Disposition” means any direct or indirect sale, issuance,
conveyance, transfer, lease, assignment or other transfer for value by the Company
or any of its Restricted Subsidiaries (including any Sale/Leaseback
Transaction) to any Person other than the Company or a Restricted Subsidiary of
the Company of the Capital Stock of any Foreign Subsidiary or any of the
property or assets of any Foreign Subsidiary.

 

“GAAP” means
generally accepted accounting principles in the United States of America
as in effect as of the Closing Date, including those set forth in (a) the
opinions and pronouncements of the Accounting Principles Board of the American
Institute of Certified Public Accountants, (b) statements and
pronouncements of the Financial Accounting Standards Board, (c) such other
statements by such other entities as are approved by a significant segment of
the accounting profession, and (d) the rules and regulations of the SEC
governing the inclusion of financial statements (including pro forma
financial statements) in periodic reports required to be filed pursuant to
Section 13 of the Exchange Act, including opinions and pronouncements
in staff accounting bulletins and similar written statements from the
accounting staff of the SEC.

 

14

 

All ratios and computations
based on GAAP contained in this Indenture shall be computed in conformity with
GAAP.

 

“Guarantee”
means any obligation, contingent or otherwise, of any Person directly or
indirectly guaranteeing any Indebtedness of any other Person and any
obligation, direct or indirect, contingent or otherwise, of such Person
(a) to purchase or pay (or advance or supply funds for the purchase or
payment of) such Indebtedness of such other Person (whether arising by virtue
of partnership arrangements, or by agreement to keep-well, to purchase assets,
goods, securities or services, to take-or-pay, or to maintain financial
statement conditions or otherwise) or (b) entered into for purposes of
assuring in any other manner the obligee of such Indebtedness of the payment
thereof or to protect such obligee against loss in respect thereof (in whole or
in part); provided, however, that the term “Guarantee” shall not
include endorsements for collection or deposit in the ordinary course of
business.  The term “Guarantee” used as
a verb has a corresponding meaning.  The
term “Guarantor” shall mean any Person Guaranteeing any obligation.

 

“Hedging
Obligations” of any Person means the obligations of such Person pursuant to any
Commodity Agreement, Interest Rate Agreement or Currency Agreement.

 

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

 

“Incur” means
issue, assume, Guarantee, incur or otherwise become liable for; provided,
however, that any Indebtedness or Capital Stock of a Person existing at
the time such Person becomes a Subsidiary (whether by merger, consolidation,
acquisition or otherwise) shall be deemed to be Incurred by such Person at the
time it becomes a Subsidiary.  The term
“Incurrence” when used as a noun shall have a correlative meaning.

 

“Indebtedness”
means, with respect to any Person on any date of determination (without
duplication):

 

(a) the
principal of and premium (if any) in respect of indebtedness of such Person for
borrowed money;

 

(b) the
principal of and premium (if any) in respect of obligations of such Person
evidenced by bonds, debentures, notes or other similar instruments;

 

(c) all
obligations of such Person in respect of letters of credit or other similar
instruments (including reimbursement obligations with respect thereto);

 

(d) all
obligations of such Person to pay the deferred and unpaid purchase price of
property or services (except Trade Payables and other accrued liabilities
arising in the ordinary course of business), which purchase price is due more
than six months after the date of placing such property in service or taking
delivery and title thereto or the completion of such services;

 

15

 

(e) all
Capitalized Lease Obligations and all Attributable Debt of such Person;

 

(f) all
obligations of such Person with respect to the redemption, repayment or other
repurchase of any Disqualified Stock or, with respect to any Subsidiary of such
Person that is not a Note Guarantor, any Preferred Stock (but excluding, in
each case, any accrued dividends);

 

(g) all
Indebtedness of other Persons secured by a Lien on any asset of such Person,
whether or not such Indebtedness is assumed by such Person; provided, however,
that the amount of Indebtedness of such Person shall be the lesser of
(i) the fair market value of such asset at such date of determination and
(ii) the amount of such Indebtedness of such other Persons;

 

(h) to the
extent not otherwise included in this definition, the net obligations under
Hedging Obligations of such Person;

 

(i) to the
extent not otherwise included, the amount then outstanding (i.e., advanced, and received by, and
available for use by, such Person) under any receivables financing (as set
forth in the books and records of such Person and confirmed by the agent,
trustee or other representative of the institution or group providing such
receivables financing); and

 

(j) all
obligations of the type referred to in clauses (a) through
(i) of other Persons and all dividends of other Persons for the payment of
which, in either case, such Person is responsible or liable, directly or indirectly,
as obligor, guarantor or otherwise, including by means of any Guarantee.

 

Notwithstanding
the foregoing, “Indebtedness” shall not include unsecured indebtedness of the
Company and its Restricted Subsidiaries Incurred to finance insurance premiums
in a principal amount not in excess of the insurance premiums to be paid by the
Company and its Restricted Subsidiaries for a three-year period beginning on
the date of Incurrence of any such Indebtedness.  The amount of Indebtedness of any Person at any date shall be the
outstanding balance at such date of all unconditional obligations as described
above and the maximum liability, upon the occurrence of the contingency giving
rise to the obligation, of any contingent obligations at such date.

 

“Indenture” means
this Indenture as amended or supplemented from time to time.

 

“Indenture
Documents” means (a) this Indenture, the Securities and the Security Documents
and (b) any other related document or instrument executed and delivered
pursuant to any Indenture Document described in clause (a) of this definition
evidencing or governing Obligations.

 

“Intangible
Assets” means goodwill, patents, trademarks and other intangibles as determined
in accordance with GAAP.

 

16

 

“Intercreditor
Agreement” means (a) that certain amended and restated intercreditor agreement,
dated as of the Closing Date, by and among the Company, the Credit Agent, the
May 2003 Notes Agent and the Trustee, as amended (including any amendment and
restatement thereof), supplemented or otherwise modified from time to time and
(b) after the termination of the Intercreditor Agreement referred to in clause
(a) above, any other intercreditor agreement, with terms no less favorable to
the Holders than the Intercreditor Agreement referred to in clause (a) above,
entered into by and among the Company, a Representative and the Trustee, as
amended (including any amendment and restatement thereof), supplemented or
otherwise modified or replaced from time to time.

 

“Interest Rate
Agreement” means with respect to any Person any interest rate protection
agreement, interest rate future agreement, interest rate option agreement,
interest rate swap agreement, interest rate cap agreement, interest rate collar
agreement, interest rate hedge agreement or other similar agreement or
arrangement as to which such Person is party or a beneficiary.

 

“Investment”
in any Person means any direct or indirect advance, loan (other than advances
to customers in the ordinary course of business that are recorded as accounts
receivable on the balance sheet of the lender) or other extension of credit
(including by way of Guarantee or similar arrangement) or capital contribution
to (by means of any transfer of cash or other property (excluding Capital Stock
of the Company) to others or any payment for property or services for the
account or use of others), or any purchase or acquisition of Capital Stock,
Indebtedness or other similar instruments issued by such Person.  For purposes of the definition of
“Unrestricted Subsidiary” and Section 4.04, (a) ”Investment” shall
include the portion (proportionate to the Company’s equity interest in such
Subsidiary) of the fair market value of the net assets of any Subsidiary of the
Company at the time that such Subsidiary is designated an Unrestricted
Subsidiary; provided, however, that upon a redesignation of such
Subsidiary as a Restricted Subsidiary, the Company shall be deemed to continue
to have a permanent “Investment” in an Unrestricted Subsidiary in an amount (if
positive) equal to (i) the Company’s “Investment” in such Subsidiary at
the time of such redesignation less (ii) the portion (proportionate to the
Company’s equity interest in such Subsidiary) of the fair market value of the
net assets of such Subsidiary at the time of such redesignation; (b) any
property transferred to or from an Unrestricted Subsidiary shall be valued at
its fair market value at the time of such transfer, in each case as determined
in good faith by (x) the senior management of the Company if the amount
thereof is less than $2.0 million and (y) the Board of Directors if
in excess thereof; and (c) the amount of any Investment shall be the
original cost as of the date of determination of such Investment plus the cost
of all additional Investments by the Company or any of its Restricted
Subsidiaries, without any adjustments for increases or decreases in value or
write-ups, write-downs or write-offs with respect to such Investments.

 

“Lien” means
any mortgage, pledge, security interest, encumbrance, lien or charge of any
kind (including any conditional sale or other title retention agreement or
lease in the nature thereof).

 

17

 

“Material
After-Acquired Property” means (i) assets acquired by the Company or any
Note Guarantor after the date the Securities are issued which constitute
accretions, additions or technological upgrades to the assets that form part of
the First-Priority Collateral immediately prior to such accretion, addition or
upgrade, (ii) First-Priority Assets of the Company or any Note Guarantor
acquired after the date the Securities are issued (or First-Priority Assets of
any Note Guarantor that is formed or acquired after the date the Securities are
issued) and (iii) any First-Priority Assets acquired by the Company or any
Restricted Subsidiary pursuant to clauses (a)(ii), (a)(iii) and (a)(iv)(1) of
Section 4.06,  other than, in the case of clauses (i) and (ii), assets
that are not permitted to be subject to a first-priority security interest for
the benefit of the First-Priority Obligations by the terms of any encumbrance
or restriction described in Section 4.05(d).

 

“Material
Subsidiary” means, at any date of determination, any Subsidiary of the Company
that, together with its Subsidiaries, (a) for the most recent fiscal year
of the Company accounted for more than 10.0% of the consolidated revenues of
the Company or (b) as of the end of such fiscal year, was the owner of
10.0% of the consolidated assets of the Company, all as set forth on the most
recently available consolidated financial statement of the Company and its
consolidated Subsidiaries for such fiscal year prepared in conformity with
GAAP.

 

“May 2003
Notes” means the $250,000,000 aggregate principal amount of the Company’s 11
1/8% senior secured notes due 2009 issued by the Company on
May 30, 2003, together with any exchange notes issued in respect thereof.

 

“May 2003
Notes Agent” means Wilmington Trust Company, in its capacity as trustee for the
holders of the May 2003 Notes or any successor thereto, or any Person
designated as the “May 2003 Notes Agent” pursuant to the Intercreditor
Agreement.

 

“May 2003
Notes Documents” means the indenture under which the May 2003 Notes were
issued, together with related documents thereto, including any guarantee
agreements and security documents, as may be amended, modified, supplemented,
restated or replaced from time to time.

 

“May 2003
Notes Obligations” means the Indebtedness evidenced by the May 2003 Notes,
including principal, premium (if any), interest (including interest accruing on
or after the filing of any petition in bankruptcy or for reorganization
relating to the Company whether or not a claim for post-filing interest is
allowed in such proceedings), fees, charges, expenses, reimbursement
obligations, guarantees and all other amounts payable thereunder or in respect
thereof.

 

“May 2003
Notes Security Agreement” means the Second Priority Security Agreement securing
the May 2003 Notes, as in effect as of the Closing Date.

 

“Mortgaged
Property” means, initially, the parcels of real property located at the
following locations: (i) 299 Clukey Drive, Harrington, Delaware; (ii) 1330

 

18

 

Lebanon Road, Danville,
Kentucky; (iii) 10 Greenfield Road, South Deerfield, Massachusetts; (iv) 1
Edison Drive, McAlester, Oklahoma; (v) 851 Garrett Parkway, Lewisburg,
Tennessee; (vi) 230 Enterprise Drive, Newport News, Virginia; (vii) 8039 South
192nd Street, Kent, Washington; and (viii) 1701 First Avenue, Chippewa Falls,
Wisconsin, and includes each other parcel of real property and the improvements
thereto with respect to which a Mortgage is granted pursuant to Section 4.11.

 

“Mortgages”
means a mortgage, deed of trust, assignment of leases and rents, leasehold
mortgage or other security document granting a Lien on any Mortgaged Property
to secure the Obligations.

 

“Net Available
Cash” from an Asset Disposition means cash payments received (including any
cash payments received by way of deferred payment of principal pursuant to a
note or installment receivable or otherwise and proceeds from the sale or other
disposition of any securities received as consideration, but only as and when
received, but excluding any other consideration received in the form of
assumption by the acquiring Person of Indebtedness or other obligations
relating to the properties or assets that are the subject of such Asset
Disposition or received in any other non-cash form) therefrom, in each case net
of (a) all legal, accounting, investment banking, title and recording tax
expenses, commissions and other fees and expenses incurred, and all Federal,
state, provincial, foreign and local taxes required to be paid or accrued as a
liability under GAAP, as a consequence of such Asset Disposition, (b) all
payments made on any Indebtedness which is secured by any assets subject to
such Asset Disposition, in accordance with the terms of any Lien upon or other
security agreement of any kind with respect to such assets, or which must by
its terms, or in order to obtain a necessary consent to such Asset Disposition,
or by applicable law be repaid out of the proceeds from such Asset Disposition,
(c) all distributions and other payments required to be made to minority
interest holders in Subsidiaries or joint ventures as a result of such Asset
Disposition, (d) the decrease in proceeds from Qualified Securitization
Transactions which results from such Asset Disposition and (e) appropriate
amounts to be provided by the seller as a reserve, in accordance with GAAP,
against any liabilities associated with the property or other assets disposed
of in such Asset Disposition and retained by the Company or any Restricted
Subsidiary after such Asset Disposition.

 

“Net Cash
Proceeds”, with respect to any issuance or sale of Capital Stock, means the
cash proceeds of such issuance or sale net of attorneys’ fees, accountants’
fees, underwriters’ or placement agents’ fees, discounts or commissions and
brokerage, consultant and other fees and expenses actually incurred in
connection with such issuance or sale and net of taxes paid or payable as a
result thereof.

 

“Note
Guarantee” means each Guarantee of the obligations with respect to the
Securities issued by a Person pursuant to the terms of this Indenture.

 

“Note
Guarantor” means any Person that has issued a Note Guarantee.

 

“Notes
Collateral Account” means an account maintained by the Company in the name of
the Trustee with any financial institution reasonably designated by the

 

19

 

Trustee into which Net Cash
Proceeds in respect of the First-Priority Collateral is required to be
deposited pursuant to this Indenture or the Security Documents.

 

“Notes
Obligations” means the Indebtedness evidenced by the Securities, including
Accreted Value or principal, premium (if any), interest (including interest
accruing on or after the filing of any petition in bankruptcy or for
reorganization relating to the Company whether or not a claim for post-filing
interest is allowed in such proceedings), fees, charges, expenses,
reimbursement obligations, guarantees and all other amounts payable thereunder
or in respect thereof.

 

“Obligations”
means all obligations of the Company and the Note Guarantors under this
Indenture, the Securities and the other Indenture Documents, including
obligations to the Trustee and the Collateral Agent, whether for payment of
principal of, interest, including Additional Interest, if any, on the
Securities and all other monetary obligations of the Company and the Note
Guarantors under this Indenture, the Securities and the other Indenture
Documents, whether for fees, expenses, indemnification or otherwise.

 

“Officer”
means the Chairman of the Board, the Chief Executive Officer, the Chief
Financial Officer, the President, any Vice President, the Treasurer, the
Secretary or any Assistant Secretary of the Company.

 

“Officers’
Certificate” means a certificate signed by two Officers.

 

“Opinion of
Counsel” means a written opinion from legal counsel who is acceptable to the
Trustee.  The counsel may be an employee
of or counsel to the Company.

 

“Other
First-Priority Assets” means intellectual property and all other types of
property in which a security interest is granted pursuant to the May 2003
Notes Security Agreement, other than the Second-Priority Collateral.

 

“Other
First-Priority Obligations” means any Refinancing Indebtedness in respect of
the Securities that is designated by the Company as “Other First-Priority
Obligations” for purposes of this Indenture, including principal, premium (if
any), interest (including interest accruing on or after the filing of any
petition in bankruptcy or for reorganization relating to the Company or any
Note Guarantor whether or not a claim for post-filing interest is allowed in
such proceedings), fees, charges, expenses, reimbursement obligations,
guarantees and all other amounts payable thereunder or in respect thereof; provided,  however,
that if such Refinancing Indebtedness contains or otherwise has the benefit of provisions
effectively requiring that proceeds from sales or transfers of property or
assets by the Company or any Subsidiary of the Company be applied to repay,
redeem or retire, or offer to repay, redeem or retire, such Refinancing
Indebtedness, the terms thereof shall be no more favorable to the holders of
such Refinancing Indebtedness than those set forth in this Indenture for the
benefit of the Holders.

 

20

 

“Permitted
Business” means the design, manufacture and/or marketing of films and flexible
packaging products for food, personal care, medical, retail, agricultural,
industrial and other applications or any businesses that are reasonably
related, ancillary or complementary thereto.

 

“Permitted
Holders” means each of (i) J.P. Morgan Partners, LLC and its Affiliates, (ii)
Southwest Industrial Films, LLC and its Affiliates, (iii) the Christena Karen
H. Durham Trust, (iv) the Existing Management Stockholders and their Related
Parties and (v) any Person acting in the capacity of an underwriter in
connection with a public or private offering of the Company’s Capital Stock

 

“Permitted
Investment” means an Investment by the Company or any Restricted Subsidiary in:
(a) the Company, a Restricted Subsidiary or a Person that will, upon the
making of such Investment, become a Restricted Subsidiary; provided, however,
that after giving effect to such Investment the Company is still in compliance
with Section 4.12; 
(b) another Person if as a result of such Investment such other
Person is merged or consolidated with or into, or transfers or conveys all or
substantially all its assets to, the Company or a Restricted Subsidiary; provided,
however, that after giving effect to such Investment the Company is
still in compliance with Section 4.12; (c) Temporary Cash
Investments; (d) receivables owing to the Company or any Restricted
Subsidiary if created or acquired in the ordinary course of business and
payable or dischargeable in accordance with customary trade terms; provided,
however, that such trade terms may include such concessionary trade
terms as the Company or any such Restricted Subsidiary deems reasonable under
the circumstances; (e) payroll, travel and similar advances or loans to
cover matters that are expected at the time of such advances ultimately to be
treated as expenses for accounting purposes and that are made in the ordinary
course of business; (f) loans or advances to officers, directors,
consultants or employees made (A) in the ordinary course of business and
not exceeding $3.0 million in any year or (B) to fund purchases of
stock under the Company’s 2000 Stock Incentive Plan, the 2002 Stock Incentive
Plan and any similar plans or employment arrangements; (g) Capital Stock,
obligations or other securities received in settlement of debts created in the
ordinary course of business and owing to the Company or any Restricted
Subsidiary or in satisfaction of judgments or pursuant to any plan of
reorganization or similar arrangement upon the bankruptcy or insolvency of a
debtor; (h) any Person to the extent such Investment represents the
non-cash portion of the consideration received for an Asset Disposition that
was made pursuant to and in compliance with Section 4.06; (i) any
Investment by the Company or a Restricted Subsidiary in a Securitization Entity
or any Investment by a Securitization Entity in any other Person in connection
with a Qualified Securitization Transaction; provided that any
Investment in a Securitization Entity is in the form of a purchase money note
or an equity interest; (j) Hedging Obligations entered into in the
ordinary course of business; (k) endorsements of negotiable instruments
and documents in the ordinary course of business; (l) assets or securities
of a Person acquired by the Company or a Restricted Subsidiary to the extent
the consideration for such acquisition consists of Capital Stock (other than
Disqualified Stock) of the Company; 
(m) Investments in existence on the Closing Date; (n) Investments
of a Person or any of its Subsidiaries existing at the time such Person becomes
a Restricted Subsidiary of the Company or at the time such Person merges or
consolidates with the Company or any of

 

21

 

its Restricted Subsidiaries, in
either case in compliance with this Indenture; provided that such
Investments were not made by such Person in connection with, or in anticipation
or contemplation of, such Person becoming a Restricted Subsidiary of the
Company or such merger or consolidation; (o) Investments in Unrestricted
Subsidiaries or joint ventures not to exceed $30.0 million since the
Closing Date plus (A) the aggregate net after-tax amount returned since
the Closing Date to the Company or any Restricted Subsidiary in cash on or with
respect to any Investments made since the Closing Date in Unrestricted
Subsidiaries and joint ventures whether through interest payments, principal
payments, dividends or other distributions or payments (including such
dividends, distributions or payments made concurrently with such Investment),
(B) the net after-tax cash proceeds received since the Closing Date by the
Company or any Restricted Subsidiary from the disposition of all or any portion
of such Investments (other than to the Company or a Subsidiary of the Company),
and (C) upon redesignation since the Closing Date of an Unrestricted
Subsidiary as a Restricted Subsidiary, the fair market value of such
Subsidiary, provided that any amounts included pursuant to the foregoing
clauses (A), (B) and (C) are excluded from the calculation set forth in clause
(a)(iv)(3) under Section 4.04; and (p) additional Investments since the
Closing Date in an aggregate amount not to exceed $15.0 million.

 

“Permitted
Liens” means: (a) Liens upon (1) any First-Priority Collateral securing
any Indebtedness permitted to be incurred under Section 4.03 and all other
obligations of the Company or any Restricted Subsidiary in respect of such
Indebtedness not constituting Indebtedness; provided that,
(x) unless the Indebtedness secured by such Lien constitutes Other
First-Priority Obligations, such Lien does not rank prior to or pari  passu with the Liens on the First-Priority Collateral in
favor of the Notes and (y) the holder of such Lien (i) becomes party
to the Intercreditor Agreement, or agrees to be bound by the terms of the
Intercreditor Agreement, and (ii) agrees to have the obligations of the
Company and the Note Guarantors that are secured by the property subject to
such Lien treated as Second-Priority Obligations thereunder; and (2) any
Second-Priority Collateral securing any Indebtedness permitted to be incurred
under Section 4.03 and all other obligations of the Company or any Restricted
Subsidiary in respect of such Indebtedness not constituting Indebtedness; (b)
Liens securing the Securities (including any Additional Securities and any
Exchange Notes) and the Note Guarantees thereof; (c) Liens in favor of the
Company or any Restricted Subsidiary; (d) Liens on property of a Person
existing at the time such Person is merged with or into or consolidated with or
acquired by the Company or any Restricted Subsidiary; (e) Liens on property
existing at the time of acquisition of the property by the Company or any
Restricted Subsidiary; (f) Liens to secure Indebtedness (including Capitalized
Lease Obligations) permitted by Section 4.03(b)(vi) covering only the property,
equipment or other assets acquired with such Indebtedness or additions or
improvements to such assets; (g) Liens for taxes, assessments or governmental
charges or claims that are not yet delinquent or that are being contested in
good faith by appropriate proceedings promptly instituted and diligently
concluded; provided that any reserve or other appropriate provision as
is required in conformity with GAAP has been made therefor; (h) Liens incurred
in the ordinary course of business, including, without limitation, judgment and
attachment liens of the Company or any Restricted Subsidiary of the Company
with respect to obligations that do not exceed in the aggregate $25.0 million
at any one time outstanding and that are

 

22

 

not incurred in connection with
the borrowing of money or the obtaining of advances of credit (other than trade
credit in the ordinary course of business, not evidenced by a note and not past
due); (i) Liens in favor of the Trustee, the trustee under the Senior
Subordinated Notes Indentures, the warrant agent under the warrant agreement
dated as of May 31, 2000 entered into by the Company and any other trustee or
warrant agent acting in such capacity with respect to one or more future
indentures or agreements so long as the related Indebtedness is permitted to be
Incurred under Section 4.03; (j) Liens incurred in connection with Refinancing
Indebtedness, but only if such Liens extend to no more assets than the Liens
securing the Indebtedness being refinanced; provided further,
that no Liens may be incurred pursuant to this clause (j) in respect of
First-Priority Collateral, except to the extent the Liens on such First-
Priority Collateral are incurred in connection with Refinancing Indebtedness
that Refinanced Indebtedness that was secured by Permitted Liens described
under clauses (d), (e) or (f) of this definition; (k) Liens securing
Hedging Obligations; (l) statutory Liens of landlords and carriers’,
warehousemen’s, mechanics’, suppliers’, materialmen’s, repairmen’s, or other
like Liens (including contractual landlords liens) arising in the ordinary
course of business and with respect to amounts not yet delinquent by more than
60 days or being contested in good faith by appropriate proceedings, if a
reserve or other appropriate provision, if any, as shall be required in
conformity with GAAP shall have been made therefor; (m) Liens incurred and
deposits made in the ordinary course of business in connection with workers’
compensation, unemployment insurance and other types of social security;
(n) Liens to secure Indebtedness of any Foreign Subsidiary (other than
Liens described by clause (a)(1) of this definition); (o) licenses,
sublicenses, subleases, easements, zoning restrictions, rights-of-way,
restrictions, minor defects or irregularities in title and other similar
charges or encumbrances not interfering in any material respect with the
business of the Company or any of its Restricted Subsidiaries; (p) Liens on
specific items of inventory or other goods and proceeds thereof of any Person
securing such Person’s obligations in respect of bankers’ acceptances issued or
created for the account of such Person to facilitate the purchase, shipment or
storage of such inventory or other goods; (q) Liens securing reimbursement
obligations with respect to commercial letters of credit which encumber
documents and the property relating to such letters of credit and products and
proceeds thereof; (r) any interest or title of a lessor in the property subject
to any lease or arising from filing Uniform Commercial Code financing
statements regarding leases; (s) judgment liens in respect of judgments that do
not constitute an Event of Default; (t) Liens existing on the Closing Date; (u)
Liens incurred or deposits made to secure the performance of bids, trade
contracts, leases, statutory obligations, surety and appeal bonds, performance
bonds and other obligations of a like nature, in each case in the ordinary
course of business; (v) ground leases in respect of real property on which
facilities owned or leased by the Company or any of its Restricted Subsidiaries
are located; (w) 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; (x) leases or subleases granted to other Persons and not
interfering in any material respect with the business of the Company and its
Restricted Subsidiaries, taken as a whole; (y) Liens in connection with a
Qualified Securitization Transaction incurred in compliance with Section
4.03(b)(ix); (z) Liens arising solely by virtue of any statutory or common law
provision relating to banker’s liens, rights of setoff or similar rights; and

 

23

 

(aa) Liens securing insurance
premium financing arrangements which are otherwise excluded from the definition
of Indebtedness.

 

“Person” means
any individual, corporation, partnership, limited liability company, joint
venture, association, joint-stock company, trust, unincorporated organization,
government or any agency or political subdivision thereof or any other entity.

 

“Pledge
Agreement” means the Pledge Agreement dated as of the Closing Date, among the
Company, the Subsidiary Pledgors (as defined therein) and the Collateral Agent,
as such agreement may be amended, modified, supplemented or restated from time
to time.

 

“Preferred
Stock”, as applied to the Capital Stock of any Person, means Capital Stock of
any class or classes (however designated) that is preferred as to the payment
of dividends, or as to the distribution of assets upon any voluntary or
involuntary liquidation or dissolution of such Person, over Capital Stock of
any other class of such Person.

 

“principal” of
a Security means the principal of the Security plus the premium, if any,
payable on the Security which is due or overdue or is to become due at the
relevant time.

 

“Proceeds”
shall have the meaning assigned to such term in the Uniform Commercial Code.

 

“Public
Market” means any time after (a) an Equity Offering has been consummated
and (b) at least 15% of the total issued and outstanding common stock of
the Company has been distributed by means of an effective registration
statement under the Securities Act.

 

“Qualified
Securitization Transaction” means any transaction or series of transactions
that may be entered into by the Company or any of its Subsidiaries pursuant to
which the Company or any of its Subsidiaries may sell, convey or otherwise
transfer pursuant to customary terms to (a) a Securitization Entity (in the
case of a transfer by the Company or any of its Subsidiaries) and (b) any
other Person (in the case of a transfer by a Securitization Entity), or may
grant a security interest in any accounts receivable (whether now existing or
arising or acquired in the future) of the Company or any of its Subsidiaries,
and any assets related thereto including, without limitation, all collateral
securing such accounts receivable, all contracts and contract rights and all
guarantees or other obligations in respect of such accounts receivable,
proceeds of such accounts receivable and other assets (including contract
rights) which are customarily transferred or in respect of which security
interests are customarily granted in connection with asset securitization
transactions involving accounts receivable.

 

“Qualified
Stock” means any Capital Stock that is not Disqualified Stock.

 

24

 

“Refinance”
means, in respect of any Indebtedness, to refinance, extend, renew, refund,
repay, prepay, redeem, defease or retire, or to issue other Indebtedness in
exchange or replacement for, such Indebtedness.  “Refinanced” and “Refinancing” shall have correlative meanings.

 

“Refinancing
Indebtedness” means Indebtedness that is Incurred to Refinance any Indebtedness
of the Company or any Restricted Subsidiary existing on the Closing Date or
Incurred in compliance with this Indenture (including Indebtedness of the
Company or a Restricted Subsidiary that Refinances Refinancing Indebtedness); provided,
however, that: (a) the Refinancing Indebtedness has a Stated
Maturity no earlier than the Stated Maturity of the Indebtedness being Refinanced,
(b) the Refinancing Indebtedness has an Average Life at the time such
Refinancing Indebtedness is Incurred that is equal to or greater than the
Average Life of the Indebtedness being refinanced,  (c) such Refinancing Indebtedness is Incurred in an aggregate
principal amount (or if issued with original issue discount, an aggregate issue
price) (whether in U.S. dollars or a foreign currency) that is equal to or less
than the aggregate principal amount (or if issued with original issue discount,
the aggregate accreted value) (in U.S. dollars or such foreign currency, as
applicable) then outstanding (plus, without duplication, accrued interest,
premium and defeasance costs required to be paid under the terms of the
Indebtedness being Refinanced and the fees, expenses, discounts, commissions
and other issuance costs incurred in connection with the Refinancing
Indebtedness) of the Indebtedness being Refinanced, and (d) if the
Indebtedness being Refinanced is subordinated in right of payment to the Securities
or a Note Guarantee of a Note Guarantor, such Refinancing Indebtedness is
subordinated in right of payment to the Securities or the Note Guarantee at
least to the same extent as the Indebtedness being Refinanced; provided
further, however, that Refinancing Indebtedness shall not include:
(i) Indebtedness of a Restricted Subsidiary that is not a Note Guarantor
that Refinances Indebtedness of the Company or (ii) Indebtedness of the
Company or a Restricted Subsidiary that Refinances Indebtedness of an Unrestricted
Subsidiary.

 

“Related
Parties” means with respect to a Person (a) that is a natural person
(1) any spouse, parent or lineal descendant (including adopted children)
of such Person or (2) the estate of such Person during any period in which
such estate holds Capital Stock of the Company for the benefit of any person
referred to in clause (a)(1) and (b) any trust, corporation, partnership,
limited liability company or other entity, the beneficiaries, stockholders,
partners, owners or Persons beneficially owning an interest of more than 50% of
which consist of such Person and/or such other Persons referred to in the
immediately preceding clause (a).

 

“Representative”
means the trustee, agent or representative (if any) for an issue of Senior
Indebtedness.

 

“Restricted
Investment” means any Investment other than a Permitted Investment.

 

“Restricted
Subsidiary” means any Subsidiary of the Company other than an Unrestricted
Subsidiary.

 

25

 

“Sale/Leaseback
Transaction” means an arrangement relating to property now owned or hereafter
acquired by the Company or a Restricted Subsidiary whereby the Company or a
Restricted Subsidiary transfers such property to a Person and the Company or
such Restricted Subsidiary leases it from such Person, other than
(a) leases between the Company and a Wholly Owned Subsidiary or between
Wholly Owned Subsidiaries or (b) any arrangement whereby the transfer
involves fixed or capital assets and is consummated within 120 days after the date
the Company or a Restricted Subsidiary acquires or finishes construction of
such fixed or capital assets.

 

“SEC” means
the Securities and Exchange Commission.

 

“Secondary
Collateral Obligations” means the May 2003 Notes Obligations and any other
Indebtedness of the Company and the Restricted Subsidiaries (other than the
First-Priority Obligations and the Credit Agreement Obligations) that is
secured by a Permitted Lien described in clause (a)(2) of the definition
thereof and is designated by the Company as a “Secondary Collateral Obligation”
for purposes of this Indenture.

 

“Second-Priority
Collateral” means any and all of the following assets and properties now owned
or at any time hereafter acquired by the Company or any Note Guarantor and with
respect to which a Lien is granted as security for the Credit Agreement
Obligations or any Secondary Collateral Obligations: receivables, inventory
(and Indebtedness arising from loans and advances made to enable the obligors
to acquire inventory), payment intangibles (other than payment intangibles that
represent tax refunds in respect of, or otherwise relate to, real property,
fixtures, equipment or intellectual property), 100% of the capital stock of, or
other equity interests in, existing and future Domestic Subsidiaries and
Foreign Subsidiaries that are Note Guarantors (subject to the limitation set
forth in the Pledge Agreement), and 65% of the capital stock or other equity
interests in, existing and future first-tier Foreign Subsidiaries (other than
Foreign Subsidiaries that are Note Guarantors) (subject to the limitation set
forth in the Pledge Agreement), credit card proceeds, investment property,
other financial assets, instruments, deposit, securities and commodity accounts
(and the cash and other assets contained therein), hedging, commodity and other
derivative contracts (and cash and other deposits securing the same), all
permits and licenses related to the foregoing (other than permits and licenses
related to the ownership or operation of real property, fixtures, equipment or
intellectual property), all books and records relating to the foregoing, all
general intangibles, chattel paper, instruments and documents to the extent
evidencing, governing, securing or otherwise related to the foregoing and all products
and proceeds of the foregoing in whatever form received, including proceeds of
insurance policies related to the foregoing (including proceeds of business
interruption insurance to the extent related to the first 45 days of the
covered period for any business interruption), but excluding the Notes
Collateral Account (and any cash or other assets held therein in accordance
with this Indenture or the Security Documents).

 

“Second-Priority
Obligations” means Indebtedness of the Company and the Restricted Subsidiaries
(other than the Securities and the Other First-Priority Obligations) including
principal, premium (if any), interest (including interest accruing

 

26

 

on or after the filing of any
petition in bankruptcy or for reorganization relating to the Company or any
Note Guarantor whether or not a claim for post-filing interest is allowed in
such proceedings), fees, charges, expenses, reimbursement obligations,
guarantees and all other amounts payable thereunder or in respect thereof that
is secured by a security interest in the First-Priority Collateral by a
Permitted Lien described in clause (a)(1) of the definition thereof.

 

“Securities”
means the Securities issued under this Indenture.

 

“Securities Act”
means the Securities Act of 1933, as amended.

 

“Security
Agreement” means the Security Agreement dated as of the Closing Date, among the
Company, the Guarantors (as defined therein) and the Collateral Agent, as such
agreement may be amended, modified, supplemented or restated from time to time.

 

“Security
Documents” means the Pledge Agreement, the Canadian Pledge Agreement, the
Security Agreement, the Canadian Security Agreement, the Mortgages and any
other document or instrument pursuant to which a Lien is granted by the Company
or any Note Guarantor to secure any Obligations or under which rights or
remedies with respect to such Lien are governed, as such agreements may be
amended, modified, supplemented or restated from time to time.

 

“Securitization
Entity” means a Wholly Owned Subsidiary of the Company (or another Person in
which the Company or any Subsidiary of the Company makes an Investment and to
which the Company or any Subsidiary of the Company transfers accounts
receivable and related assets) which engages in no activities other than in
connection with the financing of accounts receivable and which is designated by
the Board of Directors of the Company (as provided below) as a Securitization
Entity (a) no portion of the Indebtedness or any other obligations
(contingent or otherwise) of which (i) is guaranteed by the Company or any
Subsidiary of the Company (excluding guarantees of obligations (other than the
principal of, and interest on, Indebtedness) pursuant to Standard
Securitization Undertakings), (ii) is recourse to or obligates the Company
or any Subsidiary of the Company in any way other than pursuant to Standard
Securitization Undertakings or (iii) subjects any property or asset of the
Company or any Subsidiary of the Company, directly or indirectly, contingently
or otherwise, to the satisfaction thereof, other than pursuant to Standard
Securitization Undertakings, (b) with which neither the Company nor any
Subsidiary of the Company has any material contract, agreement, arrangement or
understanding other than on terms no less favorable to the Company or such
Subsidiary than those that might be obtained at the time from Persons that are
not Affiliates of the Company, other than fees payable in the ordinary course
of business in connection with servicing receivables of such entity and
(c) to which neither the Company nor any Subsidiary of the Company has any
obligation to maintain or preserve such entity’s financial condition or cause
such entity to achieve certain levels of operating results.  Any such designation by the Board of
Directors of the Company shall be evidenced to the Trustee, by filing with the
Trustee a certified copy of

 

27

 

the resolution of the Board of
Directors giving effect to such designation and an Officers’ Certificate
certifying that such designation complied with the foregoing conditions.

 

“Senior
Indebtedness” of the Company or any Note Guarantor, as the case may be, means
the principal of, premium (if any) and accrued and unpaid interest on
(including interest accruing on or after the filing of any petition in
bankruptcy or for reorganization of the Company or any Note Guarantor, as
applicable, regardless of whether or not a claim for post-filing interest is
allowed in such proceedings), and fees and other amounts owing in respect of,
Bank Indebtedness, the Securities (in the case of the Company), the Note
Guarantees (in the case of the Note Guarantors), Other First-Priority
Obligations and all other Indebtedness of the Company or any Note Guarantor, as
applicable, whether outstanding on the Closing Date or thereafter Incurred,
unless in the instrument creating or evidencing the same or pursuant to which
the same is outstanding it is provided that such obligations are subordinated
in right of payment to the Securities or such Note Guarantor’s Note Guarantee.

 

“Senior
Subordinated Notes” of the Company means the $220,000,000 aggregate principal
amount of the Company’s 13% senior subordinated notes due 2010 issued by the Company
on May 31, 2000 and the $100,000,000 aggregate principal amount of the
Company’s 13% senior subordinated notes due 2010 issued by the Company on April
10, 2002, in each case together with the exchange notes issued in respect
thereof, in such case, to the extent outstanding.

 

“Senior
Subordinated Notes Indentures” means the indentures dated as of May 31, 2000,
and April 10, 2002, among the Company, the subsidiary guarantors party thereto
and The Bank of New York, as trustee, under which the Company’s Senior
Subordinated Notes were issued, each as amended, modified or supplemented from
time to time.

 

 “Significant Subsidiary” means any Restricted
Subsidiary that would be a “Significant Subsidiary” of the Company within the
meaning of Rule 1-02 under Regulation S-X promulgated by the SEC.

 

“Standard
Securitization Undertakings” means representations, warranties, covenants and
indemnities entered into by the Company or any Subsidiary of the Company which
are reasonably customary in an accounts receivable securitization transaction.

 

“Stated
Maturity” means, with respect to any security, the date specified in such
security as the fixed date on which the final payment of principal of such
security is due and payable, including pursuant to any mandatory redemption
provision (but excluding any provision providing for the repurchase of such
security at the option of the holder thereof upon the happening of any
contingency beyond the control of the issuer unless such contingency has
occurred).

 

“Stockholders
Agreement” means the Stockholders Agreement among the Company and the holders
of the Company’s Capital Stock party thereto, as in effect on

 

28

 

the Closing Date and as amended
from time to time, so long as the Permitted Holders own a majority of the
Capital Stock subject to such agreement.

 

“Subordinated
Obligation” means any Indebtedness of the Company (whether outstanding on the
Closing Date or thereafter Incurred) that is subordinate or junior in right of
payment to the Securities pursuant to a written agreement. “Subordinated
Obligation” of a Note Guarantor has a correlative meaning.

 

“Subsidiary”
of any Person means any corporation, association, partnership, limited
liability company or other business entity of which more than 50% of the total
voting power of shares of Capital Stock or other interests (including
partnership interests) entitled (without regard to the occurrence of any
contingency) to vote in the election of directors, representatives, managers or
trustees thereof is at the time owned or controlled, directly or indirectly, by
(a) such Person, (b) such Person and one or more Subsidiaries of such
Person or (c) one or more Subsidiaries of such Person.

 

“Tangible
Assets” means Total Assets less Intangible Assets.

 

“Temporary
Cash Investments” means any of the following: 
(a) any investment in direct obligations of the United States
of America or any agency or instrumentality thereof or obligations Guaranteed
or insured by the United States of America or any agency or
instrumentality thereof, (b) investments in checking accounts, savings
accounts, time deposit accounts, certificates of deposit, bankers’ acceptances
and money market deposits maturing within 360 days of the date of
acquisition thereof issued by a bank or trust company that is organized under
the laws of the United States of America, any state thereof or any foreign
country recognized by the United States of America having capital, surplus
and undivided profits aggregating in excess of $250,000,000 (or the foreign
currency equivalent thereof) and whose long-term debt is rated “A” (or such
similar equivalent rating) or higher by at least one nationally recognized
statistical rating organization (as defined in Rule 436 under the Securities
Act), (c) repurchase obligations with a term of not more than 30 days
for underlying securities of the types described in clause (a) above
entered into with a bank meeting the qualifications described in
clause (b) above, (d) investments in commercial paper, maturing not
more than 270 days after the date of acquisition, issued by a corporation
(other than an Affiliate of the Company) organized and in existence under the
laws of the United States of America or any foreign country recognized by
the United States of America with a rating at the time as of which any
investment therein is made of “P-1” (or higher) according to Moody’s Investors
Service, Inc. or “A-1” (or higher) according to Standard and Poor’s Ratings
Service, a division of The McGraw-Hill Companies, Inc. (“S&P”),
(e) investments in securities with maturities of six months or less from
the date of acquisition issued or fully guaranteed by any state, commonwealth
or territory of the United States of America, or by any political subdivision
or taxing authority thereof, and rated at least “A” by S&P or “A” by
Moody’s Investors Service, Inc. and (f) investments in money market funds
that invest substantially all of their assets in securities of the types
described in clauses (a) through (e) above.

 

29

 

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

 

“Total Assets”
means the total consolidated assets of the Company and its Restricted
Subsidiaries, as shown on the most recent balance sheet of the Company.

 

“Trade
Payables” means, with respect to any Person, any accounts payable or any
indebtedness or monetary obligation to trade creditors created, assumed or
Guaranteed by such Person arising in the ordinary course of business in
connection with the acquisition of goods or services.

 

“Trustee”
means the party named as such in this Indenture until a successor replaces it
and, thereafter, means the successor.

 

“Trust
Officer” means the Chairman of the Board, the President or any other officer or
assistant officer of the Trustee assigned by the Trustee to administer its
corporate trust matters.

 

“Uniform
Commercial Code” means the New York Uniform Commercial Code as in effect
from time to time.

 

“Unrestricted
Subsidiary” means (a) Pliant Investment, Inc. and any Subsidiary of the
Company that at the time of determination shall be designated an Unrestricted
Subsidiary by the Board of Directors in the manner provided below and
(b) any Subsidiary of an Unrestricted Subsidiary.  The Board of Directors may designate any
Subsidiary of the Company (including any newly acquired or newly formed
Subsidiary of the Company) to be an Unrestricted Subsidiary unless such
Subsidiary or any of its Subsidiaries owns any Capital Stock in or Indebtedness
of, or owns or holds any Lien on any property of, the Company or any other
Subsidiary of the Company that is not a Subsidiary of the Subsidiary to be so
designated; provided, however, that either (i) the
Subsidiary to be so designated at the time of designation has total
Consolidated assets of $1,000 or less or (ii) if such Subsidiary has
Consolidated assets greater than $1,000, then such designation would be
permitted under Section 4.04.  The
Board of Directors may designate any Unrestricted Subsidiary to be a Restricted
Subsidiary; provided, however, that immediately after giving
effect to such designation (a) the Company could Incur $1.00 of additional
Indebtedness under Section 4.03(a) and (b) no Default shall have
occurred and be continuing.  Any such
designation of a Subsidiary as a Restricted Subsidiary or Unrestricted
Subsidiary by the Board of Directors shall be evidenced to the Trustee by
promptly filing with the Trustee a copy of the resolution of the Board of
Directors giving effect to such designation and an Officers’ Certificate
certifying that such designation complied with the foregoing provisions.

 

“U.S.
Government Obligations” means direct obligations (or certificates representing
an ownership interest in such obligations) of the United States of America
(including any agency or instrumentality thereof) for the payment of which the
full faith and credit of the United States of America is pledged and which
are not callable or redeemable at the issuer’s option.

 

30

 

“Voting Stock”
of a Person means all classes of Capital Stock or other interests (including
partnership interests) of such Person then outstanding and normally entitled
(without regard to the occurrence of any contingency) to vote in the election
of directors, managers or trustees thereof.

 

“Wholly Owned
Subsidiary” means a Restricted Subsidiary of the Company all the Capital Stock
of which (other than directors’ qualifying Capital Stock) is owned by the
Company or another Wholly Owned Subsidiary.

 

SECTION 1.02. 
Other Definitions.

 

	
  Term

  	
   

  	
  Defined in

  Section

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  “Affiliate Transaction”

  	
   

  	
  4.07(a)

  	
   

  
	
  “Appendix”

  	
   

  	
  Preamble

  	
   

  
	
  “Bankruptcy Law”

  	
   

  	
  6.01

  	
   

  
	
  “Cash Election Date”

  	
   

  	
  1.01

  	
   

  
	
  “Change of Control Offer”

  	
   

  	
  4.08(b)

  	
   

  
	
  “covenant defeasance option”

  	
   

  	
  8.01(b)

  	
   

  
	
  “Custodian”

  	
   

  	
  6.01

  	
   

  
	
  “Definitive Securities”

  	
   

  	
  Appendix A

  	
   

  
	
  “Event of Default”

  	
   

  	
  6.01

  	
   

  
	
  “Global Securities”

  	
   

  	
  Appendix A

  	
   

  
	
  “Guaranteed Obligations”

  	
   

  	
  11.01

  	
   

  
	
  “incorporated provision”

  	
   

  	
  12.01

  	
   

  
	
  “Initial Securities”

  	
   

  	
  Preamble

  	
   

  
	
  “Issue Date”

  	
   

  	
  Appendix A

  	
   

  
	
  “legal defeasance option”

  	
   

  	
  8.01(b)

  	
   

  
	
  “Legal Holiday”

  	
   

  	
  12.08

  	
   

  
	
  “Liens Securing Secondary Collateral
  Obligations”

  	
   

  	
  10.08(d)

  	
   

  
	
  “Notice of Default”

  	
   

  	
  6.01

  	
   

  
	
  “Offer”

  	
   

  	
  4.06(c)

  	
   

  
	
  “Offer Amount”

  	
   

  	
  4.06(d)(ii)

  	
   

  
	
  “Offer Period”

  	
   

  	
  4.06(d)(ii)

  	
   

  
	
  “Original Securities”

  	
   

  	
  Preamble

  	
   

  
	
  “Paying Agent”

  	
   

  	
  2.04

  	
   

  
	
  “Permitted Debt”

  	
   

  	
  4.03(b)

  	
   

  
	
  “Private Exchange”

  	
   

  	
  Appendix A

  	
   

  
	
  “Private Exchange Notes”

  	
   

  	
  Appendix A

  	
   

  
	
  “protected purchaser”

  	
   

  	
  2.08

  	
   

  
	
  “Purchase Date”

  	
   

  	
  4.06(d)(i)

  	
   

  
	
  “Registration Agreement”

  	
   

  	
  Appendix A

  	
   

  
	
  “Registered Exchange Offer”

  	
   

  	
  Appendix A

  	
   

  
	
  “Registrar”

  	
   

  	
  2.04

  	
   

  
	
  “Restricted Payment”

  	
   

  	
  4.04(a)

  	
   

  
	
  “Second-Priority Liens Securing Note
  Obligations”

  	
   

  	
  10.08(d)

  	
   

  

 

31

 

	
  Term

  	
   

  	
  Defined in

  Section

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  “Securities Custodian”

  	
   

  	
  Appendix A

  	
   

  
	
  “Semi-Annual Accretion Date”

  	
   

  	
  1.01

  	
   

  
	
  “Specified Date”

  	
   

  	
  1.01

  	
   

  
	
  “Successor Company”

  	
   

  	
  5.01(a)

  	
   

  
	
  “Transfer Restricted Securities”

  	
   

  	
  Appendix A

  	
   

  

 

SECTION 1.03. 
Incorporation by Reference of Trust Indenture Act.  This Indenture is subject to the mandatory
provisions of the TIA, which are incorporated by reference in and made a part
of this Indenture.  The following TIA
terms have the following meanings:

 

“Commission”
means the SEC.

 

“indenture
securities” means the Securities and the Note Guarantees.

 

“indenture security holder” means a Holder.

 

“indenture to be qualified” means this
Indenture.

 

“indenture
trustee” or “institutional trustee” means the Trustee.

 

“obligor” on
the indenture securities means the Company, the Note Guarantors and any other
obligor on the indenture securities.

 

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

 

SECTION 1.04. 
Rules of Construction. 
Unless the context otherwise requires:

 

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

 

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

 

(c) “or” is not exclusive;

 

(d) “including” means including
without limitation;

 

(e) words in the singular
include the plural and words in the plural include the singular;

 

(f) unsecured Indebtedness
shall not be deemed to be subordinate or junior to Secured Indebtedness merely
by virtue of its nature as unsecured Indebtedness;

 

32

 

(g) the principal amount of any
noninterest bearing or other discount security at any date shall be the
principal amount thereof that would be shown on a balance sheet of the issuer
dated such date prepared in accordance with GAAP;

 

(h) the principal amount of any
Preferred Stock shall be (i) the maximum liquidation value of such
Preferred Stock or (ii) the maximum mandatory redemption or mandatory
repurchase price (not including, in either case, any redemption or repurchase
premium) with respect to such Preferred Stock, whichever is greater; and

 

(i) all references in this
Indenture, in any context, to Accreted Value or any interest or other amount
payable on or with respect to the Securities shall be defined to include any
Additional Interest pursuant to the Registration Agreement, and such
adjustments shall be made to the Accreted Value of any Security as is necessary
to reflect the foregoing.

 

SECTION 1.05. 
Designated Senior Indebtedness.  For purposes of the Senior Subordinated Notes Indentures, the
Securities and the Note Guarantees shall constitute Designated Senior
Indebtedness (as such term is defined in the Senior Subordinated Notes
Indentures) of the Company and the Note Guarantors, as the case may be.

 

ARTICLE II

 

The Securities

 

SECTION 2.01. 
Amount of Securities; Issuable in Series.  The aggregate principal amount at maturity
of Securities that may be authenticated and delivered under this Indenture is
unlimited.  The Securities may be issued
in one or more series.  All Securities
of any one series shall be substantially identical except as to denomination.

 

With respect
to any Additional Securities issued after the Closing Date (except for
Securities authenticated and delivered upon registration of transfer of, or in
exchange for, or in lieu of, other Securities pursuant to Sections 2.07, 2.08,
2.09, 2.10 or 3.06 or the Appendix), there shall be (a) established in or
pursuant to a resolution of the Board of Directors and (b) set forth or
determined in the manner provided in an Officers’ Certificate prior to the
issuance of such Additional Securities:

 

(1)   whether such Additional Securities shall be
issued as part of a new or existing series of Securities and the title of such
Additional Securities (which shall distinguish the Additional Securities of the
series from Securities of any other series);

 

(2)   the aggregate principal amount at maturity
of such Additional Securities which may be authenticated and delivered under
this Indenture, which may be in an unlimited aggregate principal amount at
maturity;

 

33

 

(3)   the issue price and issuance date of such
Additional Securities, including the date from which interest on such
Additional Securities shall accrete or accrue, as applicable; provided, however,
that Additional Securities may be issued only if they are fungible with the
other Securities issued under this Indenture for U.S. federal income tax
purposes;

 

(4)   if applicable, that such Additional
Securities shall be issuable in whole or in part in the form of one or more
Global Securities and, in such case, the respective depositaries for such
Global Securities, the form of any legend or legends which shall be borne by
such Global Securities in addition to or in lieu of those set forth in Exhibit
A hereto and any circumstances in addition to or in lieu of those set forth in
Section 2.3 of the Appendix in which any such Global Security may be exchanged
in whole or in part for Additional Securities registered, or any transfer of
such Global Security in whole or in part may be registered, in the name or
names of Persons other than the depositary for such Global Security or a
nominee thereof; and

 

(5)   if applicable, that such Additional
Securities shall not be issued in the form of Original Securities as set forth
in Exhibit A, but shall be issued in the form of Exchange Notes as set forth in
Exhibit B.

 

If any of the
terms of any Additional Securities are established by action taken pursuant to
a resolution of the Board of Directors, a copy of an appropriate record of such
action shall be certified by the Secretary or any Assistant Secretary of the
Company and delivered to the Trustee at or prior to the delivery of the
Officers’ Certificate or the indenture supplemental hereto setting forth the
terms of the Additional Securities.

 

SECTION 2.02. 
Form and Dating. 
Provisions relating to the Original Securities, the Additional
Securities, the Private Exchange Notes and the Exchange Notes are set forth in
the Appendix, which is hereby incorporated in and expressly made a part of this
Indenture.  The (a) Original
Securities and the Trustee’s certificate of authentication, (b) Private
Exchange Notes and the Trustee’s certificate of authentication and (c)
Additional Securities (if issued as Transfer Restricted Securities), if any,
and the Trustee’s certificate of authentication shall each be substantially in
the form of Exhibit A hereto, which is hereby incorporated in and
expressly made a part of this Indenture. 
The Exchange Notes and the Additional Securities issued other than as
Transfer Restricted Securities, if any, and the Trustee’s certificate of
authentication shall each be substantially in the form of Exhibit B
hereto, which is hereby incorporated in and expressly made a part of this
Indenture.  The Securities may have
notations, legends or endorsements required by law, stock exchange rule,
agreements to which the Company or any Note Guarantor is subject, if any, or
usage (provided that any such notation, legend or endorsement is in a form
acceptable to the Company).  Each
Security shall be dated the date of its authentication.  The Securities shall be issuable only in
registered form without interest coupons and only in denominations of $1,000
and integral multiples thereof.

 

34

 

The Initial
Securities, the Private Exchange Notes and the Exchange Notes shall vote and
consent together on all matters (as to which any of the Securities may vote or
consent) as one class and shall be treated as a single class of Securities
issued under this Indenture.

 

SECTION 2.03. 
Execution and Authentication.  Two Officers shall sign the Securities for the Company by manual
or facsimile signature.

 

If an Officer
whose signature is on a Security no longer holds that office at the time the
Trustee authenticates the Security, the Security shall be valid nevertheless.

 

A Security
shall not be valid until an authorized signatory of the Trustee manually signs
the certificate of authentication on the Security.  The signature shall be conclusive evidence that the Security has
been authenticated under this Indenture.

 

The Trustee
shall authenticate and make available for delivery Securities as set forth in
the Appendix.

 

The Trustee
may appoint an authenticating agent reasonably acceptable to the Company to
authenticate the Securities.  Any such
appointment shall be evidenced by an instrument signed by a Trust Officer, a
copy of which shall be furnished to the Company.  Unless limited by the terms of such appointment, an
authenticating agent may authenticate Securities 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 any Registrar, Paying Agent or agent for service of notices and demands.

 

SECTION 2.04. 
Registrar and Paying Agent.  (a)  The Company shall maintain an office or agency
where Securities may be presented for registration of transfer or for exchange
(the “Registrar”) and an office or agency where Securities may be presented for
payment (the “Paying Agent”).  The
Registrar shall keep a register of the Securities and of their transfer and
exchange.  The Company may have one or
more co-registrars and one or more additional paying agents.  The term “Paying Agent” includes any
additional paying agent, and the term “Registrar” includes any co-registrars.  The Company initially appoints the Trustee
as (i) Registrar and Paying Agent in connection with the Securities and
(ii) the Securities Custodian with respect to the Global Securities.

 

(b) The Company shall enter
into an appropriate agency agreement with any Registrar or Paying Agent not a
party to this Indenture, which shall incorporate the terms of the TIA.  The agreement shall implement the provisions
of this Indenture that relate to such agent. 
The Company shall notify the Trustee of the name and address of any such
agent.  If the Company fails to maintain
a Registrar or Paying Agent, the Trustee shall act as such and shall be
entitled to appropriate compensation therefor pursuant to
Section 7.07.  The Company or any
of its domestically organized Wholly Owned Subsidiaries may act as Paying Agent
or Registrar.

 

35

 

(c) The Company may remove any
Registrar or Paying Agent upon written notice to such Registrar or Paying Agent
and to the Trustee; provided, however, that no such removal shall
become effective until (i) acceptance of an appointment by a successor as
evidenced by an appropriate agreement entered into by the Company and such
successor Registrar or Paying Agent, as the case may be, and delivered to the
Trustee or (ii) notification to the Trustee that the Trustee shall serve
as Registrar or Paying Agent until the appointment of a successor in accordance
with clause (i) above.  The
Registrar or Paying Agent may resign at any time upon written notice to the Company
and the Trustee.

 

SECTION 2.05. 
Paying Agent to Hold Money in Trust.  Prior to each due date of the principal of
and interest, including Additional Interest, if any, on any Security, the
Company shall deposit with the Paying Agent (or if the Company or a Wholly
Owned Subsidiary is acting as Paying Agent, segregate and hold in trust for the
benefit of the Persons entitled thereto) a sum sufficient to pay such
principal, interest, including Additional Interest, if any, when so becoming
due.  The Company 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 of and interest, including
Additional Interest, if any, on the Securities, and shall notify the Trustee of
any default by the Company in making any such payment.  If the Company or a Subsidiary of the
Company acts as Paying Agent, it shall segregate the money held by it as Paying
Agent and hold it as a separate trust fund. 
The Company at any time may require a Paying Agent to pay all money held
by it to the Trustee and to account for any funds disbursed by the Paying
Agent.  Upon complying with this
Section, the Paying Agent shall have no further liability for the money
delivered to the Trustee.

 

SECTION 2.06. 
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 Holders.  If the Trustee is not the Registrar, the
Company shall furnish, or cause the Registrar to furnish, to the Trustee, in
writing at least five 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 Holders.

 

SECTION 2.07. 
Transfer and Exchange. 
The Securities shall be issued in registered form and shall be
transferable only upon the surrender of a Security for registration of transfer
and in compliance with the Appendix. 
When a Security is presented to the Registrar with a request to register
a transfer, the Registrar shall register the transfer as requested if its
requirements therefor are met.  When
Securities are presented to the Registrar with a request to exchange them for
an equal principal amount at maturity of Securities of other denominations, the
Registrar shall make the exchange as requested if the same requirements are
met.  To permit registration of
transfers and exchanges, the Company shall execute and the Trustee shall
authenticate Securities at the Registrar’s request.  The Company may require payment of a sum sufficient to pay all
taxes, assessments or other governmental charges in connection with any
transfer or exchange pursuant to this Section. 
The Company shall not be required to make and the

 

36

 

Registrar need not register
transfers or exchanges of Securities selected for redemption (except, in the
case of Securities to be redeemed in part, the portion thereof not to be
redeemed) or any Securities for a period of 15 days before a selection of
Securities to be redeemed.

 

Prior to the
due presentation for registration of transfer of any Security, the Company, the
Note Guarantors, the Trustee, the Paying Agent, and the Registrar may deem and
treat the Person in whose name a Security is registered as the absolute owner
of such Security for the purpose of receiving payment of principal of and
(subject to paragraph 2 of the Securities) interest, if any, on such
Security and for all other purposes whatsoever, whether or not such Security is
overdue, and none of the Company, any Note Guarantor, the Trustee, the Paying
Agent, or the Registrar shall be affected by notice to the contrary.

 

Any Holder of
a Global Security shall, by acceptance of such Global Security, agree that
transfers of beneficial interest in such Global Security may be effected only
through a book-entry system maintained by (a) the Holder of such Global
Security (or its agent) or (b) any Holder of a beneficial interest in such
Global Security, and that ownership of a beneficial interest in such Global
Security shall be required to be reflected in a book entry.

 

All Securities
issued upon any transfer or exchange pursuant to the terms of this Indenture
shall evidence the same debt and shall be entitled to the same benefits under
this Indenture as the Securities surrendered upon such transfer or exchange.

 

The Trustee
shall have no obligation or duty to monitor, determine or inquire as to
compliance with any restrictions on transfer imposed under this Indenture or
under applicable law with respect to any transfer of any interest in any
Security (including any transfers between or among Depositary Participants or
beneficial owners of interests in any Global Security) other than to require
delivery of such certificates and other documentation or evidence as are
expressly required by, and to do so if and when expressly required by the terms
of, this Indenture, and to examine the same to determine substantial compliance
as to form with the express requirements hereof.

 

SECTION 2.08. 
Replacement Securities. 
If a mutilated Security is surrendered to the Registrar or if the Holder
of a Security claims that the Security has been lost, destroyed or wrongfully
taken, the Company shall issue and the Trustee shall authenticate a replacement
Security if the requirements of Section 8-405 of the Uniform Commercial
Code are met, such that the Holder (a) satisfies the Company or the Trustee
within a reasonable time after such Holder has notice of such loss, destruction
or wrongful taking and the Registrar does not register a transfer prior to
receiving such notification, (b) makes such request to the Company or the
Trustee prior to the Security being acquired by a protected purchaser as
defined in Section 8-303 of the Uniform Commercial Code (a “protected
purchaser”) and (c) satisfies any other reasonable requirements of the
Trustee.  If required by the Trustee or
the Company, such Holder shall furnish an indemnity bond sufficient in the
judgment of the Trustee to protect the Company, the Trustee, the Paying Agent
and the Registrar from any loss that any of them

 

37

 

may suffer if a Security is
replaced.  The Company and the Trustee
may charge the Holder for their expenses in replacing a Security.  In the event any such mutilated, lost,
destroyed or wrongfully taken Security has become or is about to become due and
payable, the Company in its discretion may pay such Security instead of issuing
a new Security in replacement thereof.

 

Every
replacement Security is an additional obligation of the Company.

 

The provisions
of this Section 2.08 are exclusive and shall preclude (to the extent
lawful) all other rights and remedies with respect to the replacement or
payment of mutilated, lost, destroyed or wrongfully taken Securities.

 

SECTION 2.09. 
Outstanding Securities. 
Securities outstanding at any time are all Securities authenticated by
the Trustee except for those canceled by it, those delivered to it for
cancelation and those described in this Section as not outstanding.  Subject to Section 12.06, a Security
does not cease to be outstanding because the Company or an Affiliate of the
Company holds the Security.

 

If a Security
is replaced pursuant to Section 2.08, it ceases to be outstanding unless
the Trustee and the Company receive proof satisfactory to them that the
replaced Security is held by a protected purchaser.

 

If the Paying
Agent segregates and holds in trust, in accordance with this Indenture, on a
redemption date or maturity date money sufficient to pay all principal,
interest, including Additional Interest, if any, payable on that date with
respect to the Securities (or portions thereof) to be redeemed or maturing, as
the case may be, then on and after that date such Securities (or portions
thereof) cease to be outstanding and interest on them ceases to accrue.

 

SECTION 2.10. 
Temporary Securities. 
In the event that Definitive Securities are to be issued under the terms
of this Indenture, until such Definitive Securities are ready for delivery, the
Company may prepare and the Trustee shall authenticate temporary
Securities.  Temporary Securities shall
be substantially in the form of Definitive Securities but may have variations
that the Company considers appropriate for temporary Securities.  Without unreasonable delay, the Company
shall prepare and the Trustee shall authenticate Definitive Securities and deliver
them in exchange for temporary Securities upon surrender of such temporary
Securities at the office or agency of the Company, without charge to the
Holder.

 

SECTION 2.11. 
Cancelation.  The
Company at any time may deliver Securities to the Trustee for cancelation.  The Registrar and the Paying Agent shall
forward to the Trustee any Securities surrendered to them for registration of
transfer, exchange or payment.  The
Trustee and no one else shall cancel all Securities surrendered for
registration of transfer, exchange, payment or cancelation and shall dispose of
canceled Securities in accordance with its customary procedures or deliver
canceled Securities to the Company pursuant to written direction by an
Officer.  The Company may not issue new
Securities to replace Securities it has redeemed, paid or delivered to

 

38

 

the Trustee for
cancelation.  The Trustee shall not
authenticate Securities in place of canceled Securities other than pursuant to
the terms of this Indenture.

 

SECTION 2.12. 
Defaulted Interest. 
If the Company defaults in a payment of interest on the Securities, the
Company shall pay the defaulted interest (plus interest on such defaulted
interest to the extent lawful) in any lawful manner.  The Company may pay the defaulted interest to the Persons who are
Holders on a subsequent special record date. 
The Company shall fix or cause to be fixed any such special record date
and payment date to the reasonable satisfaction of the Trustee and shall
promptly mail or cause to be mailed to each Holder a notice that states the
special record date, the payment date and the amount of defaulted interest to
be paid.

 

SECTION 2.13. 
CUSIP and ISIN Numbers. 
The Company in issuing the Securities may use “CUSIP” and “ISIN” numbers
(if then generally in use) and, if so, the Trustee shall use “CUSIP” and “ISIN”
numbers in notices of redemption as a convenience to Holders; provided, however,
that any such notice may state that no representation is made as to the
correctness of such numbers either as printed on the Securities or as contained
in any notice of a redemption and that reliance may be placed only on the other
identification numbers printed on the Securities, and any such redemption shall
not be affected by any defect in or omission of such numbers.  The Company shall promptly notify the
Trustee of any change in the CUSIP number.

 

ARTICLE III

 

Redemption

 

SECTION 3.01. 
Notices to Trustee. 
If the Company elects to redeem Securities pursuant to paragraph 5
of the Securities, it shall notify the Trustee in writing of the redemption
date and the principal amount at maturity of Securities to be redeemed.

 

The Company
shall give each notice to the Trustee provided for in this Section at least
60 days before the redemption date unless the Trustee consents to a
shorter period.  Such notice shall be
accompanied by an Officers’ Certificate from the Company to the effect that
such redemption will comply with the conditions herein.  Any such notice may be canceled at any time
prior to notice of such redemption being mailed to any Holder and shall thereby
be void and of no effect.

 

SECTION 3.02. 
Selection of Securities To Be Redeemed.  If fewer than all the Securities are to be
redeemed, the Trustee shall select the Securities to be redeemed pro rata or by
lot or by a method that the Trustee in its sole discretion shall deem to be
fair and appropriate.  The Trustee shall
make the selection from outstanding Securities not previously called for
redemption.  The Trustee may select for
redemption portions of the principal amount at maturity of Securities that have
denominations larger than $1,000 of principal amount at maturity.  Securities and portions of them the Trustee
selects shall be in amounts of $1,000 of principal amount at maturity or a
whole multiple of $1,000 of principal amount at maturity.  Provisions of this Indenture that apply to
Securities called for redemption also apply to portions of Securities called
for

 

39

 

redemption.  The Trustee shall notify the Company
promptly of the method it has chosen for the selection of Securities or
portions of Securities to be called for redemption.

 

SECTION 3.03. 
Notice of Redemption. 
(a)  At least 30 days but not more than 60 days
before a date for redemption of Securities, the Company shall mail a notice of
redemption by first-class mail to each Holder of Securities to be redeemed at
such Holder’s registered address.

 

The notice
shall identify the Securities to be redeemed and shall state:

 

(i) the redemption date;

 

(ii) the redemption price and the amount of accrued interest, including
Additional Interest, if any, to the redemption date;

 

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

 

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

 

(v) if fewer than all the outstanding Securities are to be redeemed,
the certificate numbers and principal amounts at maturity of the particular
Securities to be redeemed;

 

(vi) that, unless the Company defaults in making such redemption
payment or the Paying Agent is prohibited from making such payment pursuant to
the terms of this Indenture, interest on Securities (or portion thereof) called
for redemption ceases to accrue on and after the redemption date;

 

(vii) the CUSIP or ISIN number, if any, printed on the Securities being
redeemed; and

 

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

 

(b) At the Company’s request,
the Trustee shall give the notice of redemption in the Company’s name and at
the Company’s expense.  In such event,
the Company shall provide the Trustee with the information required by this
Section.

 

SECTION 3.04. 
Effect of Notice of Redemption.  Once notice of redemption is mailed, Securities called for
redemption become due and payable on the redemption date and at the redemption
price stated in the notice.  Upon surrender
to the Paying Agent, such Securities shall be paid at the redemption price
stated in the notice, plus accrued interest, including Additional Interest, if
any, to the redemption date; provided, however,  that if the redemption date is after a
regular record date and on or prior to the interest payment date, the accrued interest,
including Additional Interest, if any, shall be payable to the Holder of the
redeemed Securities registered on the relevant

 

40

 

record date.  Failure to give notice or any defect in the
notice to any Holder shall not affect the validity of the notice to any other
Holder.

 

SECTION 3.05. 
Deposit of Redemption Price.  Prior to 11:00 a.m., New York City time, on the redemption
date, the Company shall deposit with the Paying Agent (or, if the Company or a
Wholly Owned Subsidiary is the Paying Agent, shall segregate and hold in trust)
money sufficient to pay the redemption price of and accrued interest, including
Additional Interest, if any, on all Securities or portions thereof to be
redeemed on that date other than Securities or portions of Securities called
for redemption that have been delivered by the Company to the Trustee for
cancelation.  Concurrently with such
deposit, the Company shall deliver an Officers’ Certificate and an Opinion of
Counsel to the effect that the redemption complies with the conditions
contained in this Indenture.  On and
after the redemption date, interest, including Additional Interest, if any,
shall cease to accrue on Securities or portions thereof called for redemption
so long as the Company has deposited with the Paying Agent funds sufficient to
pay the principal of, plus accrued and unpaid interest, including Additional
Interest, if any, on, the Securities to be redeemed, unless the Paying Agent is
prohibited from making such payment pursuant to the terms of this Indenture.

 

SECTION 3.06. 
Securities Redeemed in Part.  Upon surrender of a Security that is redeemed in part, the
Company shall execute and the Trustee shall authenticate for the Holder (at the
Company’s expense) a new Security equal in principal amount at maturity to the
unredeemed portion of the Security surrendered.

 

ARTICLE IV

 

Covenants

 

SECTION 4.01. 
Payment of Securities. 
The Company shall promptly pay the principal of and interest, including
Additional Interest, if any, on the Securities on the dates and in the manner
provided in the Securities and in this Indenture.  Principal, interest, including Additional Interest, if any, shall
be considered paid on the date due if on such date the Trustee or the Paying
Agent holds in accordance with this Indenture money sufficient to pay all
principal and interest then due and the Trustee or the Paying Agent, as the
case may be, is not prohibited from paying such money to the Holders on that
date pursuant to the terms of this Indenture.

 

The Company
shall pay interest on overdue principal at the rate borne by the Securities,
and it shall pay interest on overdue installments of interest at the same rate
to the extent lawful.

 

SECTION 4.02. 
SEC Reports. 
Notwithstanding that the Company may not be subject to the reporting
requirements of Section 13 or 15(d) of the Exchange Act, the Company shall file
with the SEC (if permitted by SEC practice and applicable law and regulations)
and provide the Trustee and Holders and prospective Holders (upon request)
within 15 days after it files them with the SEC (or if not permitted, within 15
days after it would have otherwise been required to file them with the SEC),
copies of the

 

41

 

Company’s annual report and the
information, documents and other reports that are specified in Sections 13 and
15(d) of the Exchange Act. In addition, following the existence of a Public
Market, the Company shall furnish to the Trustee and the Holders, promptly upon
their becoming available, copies of the annual report to shareholders and any
other information provided by the Company to its shareholders generally. The
Company also shall comply with the other provisions of Section 314(a) of the
TIA.

 

Delivery of
such reports, information and documents to the Trustee is for informational
purposes only and the Trustee’s receipt of such shall not constitute
constructive notice of any information contained therein or determinable from
information contained therein, including the Company’s compliance with any of
its covenants hereunder (as to which the Trustee is entitled to rely
exclusively on Officers’ Certificates).

 

SECTION 4.03. 
Limitation on Indebtedness.  (a)  The Company shall not, and shall not permit any
Restricted Subsidiary to, Incur, directly or indirectly, any Indebtedness; provided,
however, that the Company or any Restricted Subsidiary that is a Note
Guarantor may Incur Indebtedness if on the date of such Incurrence and after
giving effect thereto the Consolidated Coverage Ratio would be greater than
2.25:1.00.

 

(b) Notwithstanding
Section 4.03(a), the Company and its Restricted Subsidiaries may Incur the
following Indebtedness (collectively, the “Permitted Debt”):

 

(i) Indebtedness Incurred pursuant to the Credit Agreement in an
aggregate principal amount not to exceed $100.0 million at any one time
outstanding less the aggregate amount of (1) all repayments of principal of
such Indebtedness pursuant to Section 4.06 and (2) the aggregate principal
amount of Indebtedness Incurred and at such time outstanding pursuant to
Section 4.03(b)(ix).

 

(ii) Indebtedness of the Company owed to and held by any Restricted
Subsidiary or Indebtedness of a Restricted Subsidiary owed to and held by the
Company or any Restricted Subsidiary; provided, however, that (1) any
subsequent issuance or transfer of any Capital Stock or any other event that
results in any such Restricted Subsidiary ceasing to be a Restricted Subsidiary
or any subsequent transfer of any such Indebtedness (except to the Company or a
Restricted Subsidiary) shall be deemed, in each case, to constitute the
Incurrence of such Indebtedness by the issuer thereof, (2) if the Company is
the obligor on such Indebtedness, such Indebtedness is expressly subordinated
to the prior payment in full in cash of all obligations with respect to the
Securities, (3) if a Restricted Subsidiary is the obligor on such Indebtedness,
such Indebtedness is made pursuant to an intercompany note and (4) if a Note
Guarantor is the obligor on such Indebtedness and the Company or another Note
Guarantor is not the obligee, such Indebtedness is subordinated in right of
payment to the Note Guarantee of such Note Guarantor;

 

42

 

(iii) Indebtedness (1) represented by the Securities, (not including
any Additional Securities), the Exchange Notes and any replacement Securities
issued pursuant to this Indenture, (2) outstanding on the Closing Date (other
than the Indebtedness described in clauses (i) and (ii) above) including,
without limitation, the Senior Subordinated Notes and the May 2003 Notes, (3)
consisting of Refinancing Indebtedness Incurred in respect of any Indebtedness
described in this clause (iii) (including Refinancing Indebtedness) or Section
4.03(a) and (4) consisting of Guarantees of any Indebtedness otherwise
permitted by the terms of this Indenture;

 

(iv) (1) Indebtedness of a Restricted Subsidiary Incurred and
outstanding on or prior to the date on which such Restricted Subsidiary was
acquired by the Company (other than Indebtedness Incurred as consideration in,
or to provide all or any portion of the funds or credit support utilized to
consummate, the transaction or series of related transactions pursuant to which
such Restricted Subsidiary became a Subsidiary of or was otherwise acquired by
the Company) and (2) Refinancing Indebtedness Incurred by a Restricted
Subsidiary in respect of Indebtedness Incurred by such Restricted Subsidiary
pursuant to this clause (iv);

 

(v) Indebtedness of the Company or a Restricted Subsidiary (1) in
respect of performance bonds, bankers’ acceptances, letters of credit and
surety or appeal bonds provided by the Company and its Restricted Subsidiaries
in the ordinary course of their business, and (2) under Commodity Agreements,
Interest Rate Agreements and Currency Agreements entered into for bona fide
hedging purposes of the Company or any Restricted Subsidiary in the ordinary
course of business; provided, however, that such Interest Rate
Agreements or Currency Agreements do not increase the principal amount of
Indebtedness of the Company and its Restricted Subsidiaries outstanding at any
time other than as a result of fluctuations in interest rates or foreign
currency exchange rates or by reason of fees, indemnities and compensation
payable thereunder;

 

(vi)  Indebtedness (including
Capitalized Lease Obligations and Attributable Debt) Incurred by the Company or
any of its Restricted Subsidiaries to finance the purchase, lease or
improvement of property (real or personal), equipment or other assets (in each
case whether through the direct purchase of assets or the Capital Stock of any
Person owning such assets); provided that the aggregate principal amount
of all Indebtedness Incurred pursuant to this clause (vi) and all Refinancing
Indebtedness Incurred to refund, refinance or replace any Indebtedness Incurred
pursuant to this clause (vi), at any time outstanding, does not exceed the
greater of (x) 5.0% of Tangible Assets and (y) $30.0 million;

 

(vii) Indebtedness arising from the honoring by a bank or other
financial institution of a check, draft or similar instrument drawn against
insufficient funds in the ordinary course, provided that such
Indebtedness is extinguished within five Business Days of Incurrence;

 

43

 

(viii) Indebtedness of the Company and its Restricted Subsidiaries
arising from agreements of the Company or a Restricted Subsidiary providing for
indemnification, adjustment of purchase price or similar obligations, in each
case incurred or assumed in connection with the disposition of any business,
assets or a Subsidiary of the Company in accordance with the terms of this
Indenture, other than Guarantees by the Company or any Restricted Subsidiary of
Indebtedness Incurred by any Person acquiring all or any portion of such
business, assets or a Subsidiary of the Company for the purpose of financing
such acquisition; provided, however, that the maximum aggregate
liability in respect of all such Indebtedness shall not exceed the gross
proceeds, including the fair market value as determined in good faith by a
majority of the Board of Directors of noncash proceeds (the fair market value
of such noncash proceeds being measured at the time it is received and without
giving effect to any subsequent changes in value), actually received by the
Company and its Restricted Subsidiaries in connection with such disposition;

 

(ix) the Incurrence by a Securitization Entity of Indebtedness in a
Qualified Securitization Transaction that is not recourse to the Company or any
Restricted Subsidiary of the Company (except for Standard Securitization
Undertakings) in an aggregate principal amount, together with the aggregate
principal amount of Indebtedness Incurred and at such time outstanding pursuant
to Section 4.03(b)(i), not to exceed $100.0 million at any one time
outstanding, less the aggregate amount of all repayments of principal of
Indebtedness Incurred pursuant to Section 4.03(b)(i) pursuant to Section 4.06;

 

(x)  Indebtedness of Foreign
Subsidiaries; provided that the aggregate outstanding amount of
Indebtedness incurred by such Foreign Subsidiaries under this clause (x) does
not exceed at any one time an amount equal to the sum of (A) 80% of the
consolidated book value of the accounts receivable of all Foreign Subsidiaries
and (B) 60% of the consolidated book value of the inventory of all Foreign
Subsidiaries;

 

(xi) Indebtedness under any Domestic Overdraft Facility; or

 

(xii)  Indebtedness of the
Company and its Restricted Subsidiaries (in addition to Indebtedness permitted
to be Incurred pursuant to Section 4.03(a) or any other clause of this
Section 4.03(b)); provided that the aggregate principal amount on
the date of Incurrence, when added to all other Indebtedness Incurred pursuant
to this clause (xii) and then outstanding, shall not exceed $20.0 million.

 

(c) Notwithstanding any other
provision of this Section 4.03, the maximum amount of Indebtedness that
the Company or any Restricted Subsidiary may Incur pursuant to this Section
shall not be deemed to be exceeded solely as a result of fluctuations in the
exchange rates of currencies.  For
purposes of determining the outstanding principal amount of any particular Indebtedness
Incurred pursuant to this Section 4.03, (i) Indebtedness Incurred
pursuant to the Credit Agreement on the Closing Date shall be treated as
Incurred pursuant to Section 4.03 (b)(i), (ii) Guarantees of, or

 

44

 

obligations in respect of letters
of credit relating to, Indebtedness which is otherwise included in the
determination of a particular amount of Indebtedness shall not be included,
(iii) if obligations in respect of letters of credit are Incurred pursuant
to the Credit Agreement and are being treated as Incurred pursuant to
Section 4.03(b)(i) and the letters of credit relate to other Indebtedness,
then such other Indebtedness shall not be included, (iv) the principal
amount of any Disqualified Stock of the Company or a Restricted Subsidiary or
Preferred Stock of a Restricted Subsidiary that is not a Note Guarantor will be
equal to the greater of the maximum mandatory redemption or repurchase price
(not including, in either case, any redemption or repurchase premium) or the
maximum liquidation preference, (v) the principal amount of Indebtedness,
Disqualified Stock of the Company or a Restricted Subsidiary or Preferred Stock
of a Restricted Subsidiary that is not a Note Guarantor issued at a price less
than the principal amount thereof, the maximum fixed redemption or repurchase
price thereof or liquidation preference thereof, as applicable, will be equal
to the amount of the liability or obligation in respect thereof determined in
accordance with GAAP, (vi) if such Indebtedness is denominated in a
currency other than U.S. dollars, the U.S. dollar equivalent principal amount
thereof shall be calculated based on the relevant currency exchange rates in
effect on the date such Indebtedness was Incurred, (vii) the accrual of
interest, accrual of dividends, the accretion of accreted value, the payment of
interest in the form of additional Indebtedness and the payment of dividends or
distributions in the form of additional Capital Stock shall not be deemed an
Incurrence of Indebtedness for purposes of this Section 4.03,
(viii) Indebtedness permitted by this Section 4.03 need not be
permitted solely by reference to one provision permitting such Indebtedness but
may be permitted in part by one such provision and in part by one or more other
provisions of this Section permitting such Indebtedness, and (ix) in the
event that Indebtedness meets the criteria of more than one of the types of
Indebtedness described in this Section 4.03, the Company, in its sole
discretion, shall classify (or later reclassify) such Indebtedness and only be
required to include the amount of such Indebtedness in one of such clauses.

 

SECTION 4.04. 
Limitation on Restricted Payments.  (a)  The Company shall not, and
shall not permit any Restricted Subsidiary, directly or indirectly, to
(i) declare or pay any dividend or make any distribution of any kind on or
in respect of its Capital Stock (including any payment in connection with any
merger or consolidation involving the Company) or similar payment to the
holders (solely in their capacities as such) of its Capital Stock except
dividends or distributions payable solely in its Capital Stock (other than
Disqualified Stock) and except dividends or distributions payable to the
Company or another Restricted Subsidiary (and, if such Restricted Subsidiary
has shareholders other than the Company or other Restricted Subsidiaries, to
its other shareholders on a pro rata basis), (ii) purchase, redeem, retire
or otherwise acquire for value any Capital Stock of the Company or any Restricted
Subsidiary held by Persons other than the Company or another Restricted
Subsidiary, (iii) purchase, repurchase, redeem, defease or otherwise
acquire or retire for value, prior to scheduled maturity, scheduled repayment
or scheduled sinking fund payment any Subordinated Obligations (other than
(1) the purchase, repurchase or other acquisition of Subordinated
Obligations purchased in anticipation of satisfying a sinking fund obligation,
principal installment or final maturity, in each case due within one year of
the date of acquisition and (2) Indebtedness Incurred pursuant to
Section 4.03(b)(ii)) or (iv) make any Investment

 

45

(other than a Permitted Investment) in any Person (any such dividend,
distribution, purchase, redemption, repurchase, defeasance, other acquisition,
retirement or Investment being herein referred to as a “Restricted Payment”) if
at the time the Company or such Restricted Subsidiary makes such Restricted
Payment:

 

(1) a Default shall have occurred and be continuing (or would result
therefrom);

 

(2) the Company could not Incur at least $1.00 of additional
Indebtedness under Section 4.03(a); or

 

(3) the aggregate amount of such Restricted Payment and all other
Restricted Payments (the amount so expended, if other than in cash, to be
determined in good faith by the Board of Directors, whose determination shall
be conclusive and evidenced by a resolution of the Board of Directors) declared
or made subsequent to the Closing Date would exceed the sum, without
duplication, of:

 

(i) 50% of the Consolidated Net Income accrued during the period
(treated as one accounting period) from the beginning of the fiscal quarter immediately
following the fiscal quarter during which the Closing Date occurred to the end
of the most recent fiscal quarter ending prior to the date of such Restricted
Payment for which consolidated financial statements of the Company are publicly
available (or, in case such Consolidated Net Income shall be a deficit, minus
100% of such deficit);

 

(ii) 100% of the aggregate Net Cash Proceeds (other than in respect of
an Excluded Contribution) received by the Company (x) as capital
contributions to the Company after the Closing Date or (y) from the issue
or sale of its Capital Stock (other than Disqualified Stock) subsequent to the
Closing Date (other than a capital contribution from or an issuance or sale to
(a) a Subsidiary of the Company or (b) an employee equity ownership or
participation plan or other trust established by the Company or any of its
Subsidiaries);

 

(iii) 100% of the fair market value (as determined in good faith by the
Board of Directors of the Company) of shares of Qualified Stock of the Company
or any Restricted Subsidiary issued after the Closing Date to acquire assets
from a third party;

 

(iv) the amount by which Indebtedness of the Company or its Restricted
Subsidiaries is reduced on the Company’s balance sheet upon the conversion or exchange
(other than by a Subsidiary of the Company) subsequent to the Closing Date of
any Indebtedness of the Company or its Restricted Subsidiaries issued after the
Closing Date which is convertible or exchangeable for Capital Stock (other than
Disqualified Stock) of the Company (less the amount of any cash or the fair
market value of other property distributed by the Company or any Restricted
Subsidiary upon such conversion or exchange);

 

46

 

(v) 100% of the aggregate amount received by the Company or any
Restricted Subsidiary in cash from the sale or other disposition (other than to
(x) the Company or a Subsidiary of the Company or (y) an employee equity
ownership or participation plan or other trust established by the Company or
any of its Subsidiaries) of Restricted Investments made by the Company or any
Restricted Subsidiary after the Closing Date and from repurchases and
redemptions of such Restricted Investments from the Company or any Restricted Subsidiary
by any Person (other than (x) the Company or any of its Subsidiaries or (y) an
employee equity ownership or participation plan or other trust established by
the Company or any of its Restricted Subsidiaries) and from repayments of loans
or advances which constituted Restricted Investments;

 

(vi) the amount equal to the net reduction in Investments in
Unrestricted Subsidiaries since the Closing Date, resulting from
(x) payments of dividends, repayments of the principal of loans or
advances or other transfers of assets to the Company or any Restricted
Subsidiary from Unrestricted Subsidiaries or (y) the redesignation of
Unrestricted Subsidiaries as Restricted Subsidiaries (valued in each case as
provided in the definition of “Investment”) not to exceed, in the case of any
Unrestricted Subsidiary, the amount of Investments previously made by the
Company or any Restricted Subsidiary in such Unrestricted Subsidiary, which
amount was included in the calculation of the amount of Restricted Payments;
and

 

(vii) $5.0 million.

 

(b) The provisions of
Section 4.04(a) shall not prohibit:

 

(i) any purchase, repurchase, retirement or other acquisition or
retirement for value of, or other distribution in respect of, Capital Stock of
the Company made by exchange for, or out of the proceeds of the substantially
concurrent sale of, Capital Stock of the Company or capital contributions to
the Company after the Closing Date (other than Disqualified Stock and other
than Capital Stock issued or sold to, or capital contribution from, a
Subsidiary of the Company or an employee equity ownership or participation plan
or other trust established by the Company or any of its Subsidiaries); provided,
however, that (1) such Restricted Payment shall be excluded in the
calculation of the amount of Restricted Payments and (2) the Net Cash
Proceeds from such sale or capital contribution applied in the manner set forth
in this clause (i) shall be excluded from the calculation of amounts under
Section 4.04(a)(iv)(3)(ii);

 

(ii) any purchase, repurchase, redemption, defeasance or other
acquisition or retirement for value of Subordinated Obligations of the Company
or a Restricted Subsidiary made by exchange for, or out of the proceeds of the
substantially concurrent sale of, (x) Capital Stock of the Company or a
Restricted Subsidiary or (y) Subordinated Obligations of the Company or a
Restricted Subsidiary that are permitted to be Incurred pursuant to
Section 4.03; provided, however, that such purchase,
repurchase, redemption, defeasance or other

 

47

 

acquisition or
retirement for value shall be excluded in the calculation of the amount of
Restricted Payments;

 

(iii) any purchase or redemption of Subordinated Obligations from Net
Available Cash to the extent permitted by Section 4.06; provided, however,
that such purchase or redemption shall be excluded in the calculation of the
amount of Restricted Payments;

 

(iv) Investments that are made with Excluded Contributions; provided,
however, that such Investments shall be excluded in the calculation of
the amount of Restricted Payments;

 

(v) dividends or other distributions paid to holders of, or redemptions
from holders of, Capital Stock within 60 days after the date of declaration
thereof, or the giving of formal notice of redemption, if at such date of
declaration such dividends or other distributions or redemptions would have
complied with Section 4.04(a); provided, however, that such
dividend, distribution or redemption shall be included in the calculation of
the amount of Restricted Payments;

 

(vi) any repurchase of Capital Stock owned by former officers,
directors, consultants or employees of the Company or its Subsidiaries or their
assigns, estates and heirs or entities controlled by them; provided, however,
that the amount of such repurchases since the Closing Date shall not, in the
aggregate, exceed the sum of (1) $10.0 million (which amount shall be
increased by the amount of any Net Cash Proceeds to the Company from
(A) sales of Capital Stock of the Company to management, other employees
or Permitted Holders subsequent to the Closing Date to the extent such amounts
are not included under Section 4.04(a)(iv)(3)(ii) and (B) any “key-man”
life insurance policies which are used to make such repurchases) and (2) $2.0
million per fiscal year of the Company commencing with fiscal year 2003 (which
amount may be used in a subsequent fiscal year to the extent not used during a
fiscal year); provided further, however, that the cancelation of
Indebtedness owing to the Company from such former officers, directors,
consultants or employees of the Company or any of its Restricted Subsidiaries
in connection with a repurchase of Capital Stock of the Company shall not be
deemed to constitute a Restricted Payment under this Indenture; provided
further, however, that such repurchase shall be included in the
calculation of the amount of Restricted Payments;

 

(vii) repurchases of Capital Stock deemed to occur upon the exercise of
stock options, warrants or other convertible securities if such Capital Stock
represents a portion of the exercise price thereof; provided, however, that such repurchases shall be excluded in the calculation
of the amount of Restricted Payments; or

 

(viii) so long as no Default or Event of Default shall have occurred
and be continuing, payments not to exceed $500,000 in the aggregate since the
Closing Date to enable the Company to make payments to holders of its Capital
Stock in

 

48

 

lieu of the issuance of fractional shares of its Capital Stock; provided, however, that
such payments shall be excluded in the calculation of the amount of Restricted
Payments.

 

SECTION 4.05. 
Limitation on Restrictions on Distributions from Restricted
Subsidiaries and Negative Pledges. 
The Company shall not, and shall not permit any Restricted Subsidiary
to, create or otherwise cause or permit to exist or become effective any
consensual encumbrance or restriction on the ability of any Restricted
Subsidiary to (a) pay dividends or make any other distributions on its
Capital Stock or pay any Indebtedness or other obligations owed to the Company
or any of its Restricted Subsidiaries (it being understood that the priority of
any preferred stock in receiving dividends or liquidating distributions prior
to dividends or liquidating distributions being paid on common stock shall not
be deemed a restriction on the ability to make distributions on Capital Stock),
(b) make any loans or advances to the Company (it being understood that
the subordination of loans or advances made to the Company to other
Indebtedness Incurred by the Company shall not be deemed a restriction on the
ability to make loans or advances), (c) transfer any of its property or
assets to the Company, except (with respect to clauses (a), (b) and (c),
unless stated otherwise):

 

(i) any encumbrance or restriction pursuant to applicable law or any
applicable rule, regulation or order, or an agreement in effect at or entered
into on the Closing Date (including the Credit Agreement, this Indenture, the
Security Documents (whether or not they become effective on or after the
Closing Date), the Senior Subordinated Notes Indentures and the May 2003 Notes
Documents);

 

(ii) any encumbrance or restriction with respect to Second-Priority
Collateral pursuant to a security agreement, pledge agreement or other document
in connection with any Credit Agreement Obligation Incurred after the Closing
Date;

 

(iii) any encumbrance or restriction with respect to a Restricted
Subsidiary pursuant to an agreement relating to any Capital Stock or
Indebtedness of such Restricted Subsidiary, in each case Incurred by such
Restricted Subsidiary prior to the date on which such Restricted Subsidiary was
acquired by the Company (other than Capital Stock or Indebtedness Incurred as
consideration in, in contemplation of, or to provide all or any portion of the
funds or credit support utilized to consummate the transaction or series of
related transactions pursuant to which such Restricted Subsidiary became a
Restricted Subsidiary or was otherwise acquired by the Company) and outstanding
on such date;

 

(iv) any encumbrance or restriction pursuant to an agreement effecting
a Refinancing of Indebtedness Incurred pursuant to an agreement referred to in
clause (c)(i), (c)(ii) or (c)(iii) of this Section 4.05 or this
clause (c)(iv) or contained in any amendment to an agreement referred to
in clause (c)(i), (c)(ii) or (c)(iii) of this Section 4.05 or
this clause (c)(iv); provided, however, that the
encumbrances and restrictions contained in any such Refinancing agreement or
amendment (1) are no more restrictive, taken as a whole, than the
encumbrances

 

49

 

and
restrictions contained in such predecessor agreements and (2) may restrict
the ability of the Company or any Restricted Subsidiary to transfer any
First-Priority Collateral only to the extent the terms of the Indebtedness
being Refinanced contained a similar restriction;

 

(v) in the case of clause (c), any encumbrance or restriction (1)
that restricts in a customary manner the assignment of any lease, license or
similar contract or the subletting, assignment or transfer of any property or
asset that is subject to a lease, license or similar contract, (2) that is
or was created by virtue of any transfer of, agreement to transfer or option or
right with respect to any property or assets of the Company or any Restricted
Subsidiary not otherwise prohibited by this Indenture, (3) contained in
security agreements securing Indebtedness of a Restricted Subsidiary to the
extent such encumbrance or restriction restricts the transfer of the property
subject to such security agreements, or (4) encumbrances or restrictions
relating to Indebtedness permitted to be Incurred pursuant to
Section 4.03(b)(vi) for property acquired in the ordinary course of
business that only imposes encumbrances or restrictions on the property so
acquired (it being agreed that any such encumbrance or restriction may also
secure other Indebtedness permitted to be Incurred by the Company and provided
by the same financing source providing the Indebtedness Incurred pursuant to
Section 4.03(b)(vi));

 

(vi) with respect to a Restricted Subsidiary, any customary restriction
imposed pursuant to an agreement entered into for the sale or disposition of
all or substantially all the Capital Stock or assets of such Restricted
Subsidiary pending the closing of such sale or disposition;

 

(vii) customary provisions in joint venture agreements and other
similar agreements entered into in the ordinary course of business;

 

(viii) Indebtedness or other contractual requirements of a
Securitization Entity in connection with a Qualified Securitization
Transaction; provided, that such restrictions apply only to such
Securitization Entity;

 

(ix) net worth provisions in leases and other agreements entered into
by the Company or any Restricted Subsidiary in the ordinary course of business;
or

 

(x) any agreement or instrument governing Indebtedness (whether or not
outstanding) of Foreign Subsidiaries of the Company permitted to be Incurred
pursuant to Section 4.03(a) or Section 4.03(b)(x); or

 

(d) create,
incur or permit to exist any Lien on any First-Priority Collateral for the
benefit of any First-Priority Obligations, except:

 

(i) any encumbrance or restriction pursuant to applicable law or any
applicable rule, regulation or order, or an agreement in effect at or entered
into on the Closing Date;

 

50

 

(ii) any encumbrance or restriction pursuant to an agreement effecting
a Refinancing of Indebtedness Incurred pursuant to an agreement referred to in
clause (d)(i) of this Section 4.05 or this clause (ii) or
contained in any amendment to an agreement referred to in clause (d)(i) of
this Section 4.05 or this clause (ii); provided, however,
that the encumbrances and restrictions contained in any such Refinancing
agreement or amendment are no more restrictive, taken as a whole, than the
encumbrances and restrictions contained in such predecessor agreements;

 

(iii) with respect to a Restricted Subsidiary, any customary
restriction imposed pursuant to an agreement entered into for the sale or
disposition of all or substantially all the Capital Stock or assets of such
Restricted Subsidiary pending the closing of such sale or disposition; or

 

(iv) customary restrictions and conditions provided by the terms of any
(a) Permitted Lien (or the agreements governing any Indebtedness to which
such Permitted Lien relates) described under clause (d), (e) or (f)
of the definition thereof or, to the extent Incurred in connection with
Refinancing Indebtedness that Refinances the Indebtedness secured by such  Permitted Lien described under clause (d),
(e) or (f) of the definition thereof, clause (j) of the definition thereof; provided
that such restrictions or conditions apply only to the property or assets the
subject of such Permitted Lien and such restrictions and conditions are no more
restrictive than those provided by the terms of the Permitted Lien (or the
agreements governing any Indebtedness to which such Permitted Lien relates) and
or (b) Indebtedness permitted by Section 4.03(b)(iv); provided that
such restrictions or conditions apply only to the property or assets of the
applicable Restricted Subsidiary and any such restrictions and conditions
provided by the terms of any Refinancing Indebtedness with respect to any such
Indebtedness are no more restrictive than those provided by the terms of the
Indebtedness being Refinanced.

 

SECTION 4.06. 
Limitation on Sales of Assets and Subsidiary Stock.  (a)The Company shall not, and shall not
permit any Restricted Subsidiary to, make any Asset Disposition with respect to
First-Priority Collateral unless (i) the Company or such Restricted
Subsidiary receives consideration (including by way of relief from, or by any
other Person assuming sole responsibility for, any liabilities, contingent or
otherwise) at the time of such Asset Disposition at least equal to the fair
market value of the Capital Stock and assets subject to such Asset Disposition,
(ii) at least 75% of the consideration thereof received by the Company or such
Restricted Subsidiary is in the form of (A) cash or Temporary Cash
Investments, (B) First-Priority Assets to be owned by the Company or any
Restricted Subsidiary and used in a Permitted Business, to the extent they are
concurrently with their acquisition added to the First-Priority Collateral
securing the Securities, or (C) Capital Stock in one or more Persons
engaged in a Permitted Business that are or thereby become Wholly Owned
Subsidiaries of the Company and (iii) to the extent Capital Stock of a Person
is received by the Company and its Restricted Subsidiaries pursuant to
clause (ii)(C) above, assets of such Person that qualify as First-Priority
Assets with a fair market value that is equal to or greater than (A) 75%
of the fair market value of the First-Priority Collateral that is the subject
of such Asset

 

51

 

Disposition less (B) the fair market value of any consideration
received by the Company and its Restricted Subsidiaries pursuant to
clause (ii)(A) or (B) above are concurrently with the acquisition added to
the First-Priority Collateral securing the Securities; and (iv) an amount equal
to 100% of the Net Available Cash from such Asset Disposition is applied by the
Company (or such Restricted Subsidiary, as the case may be):

 

(A) first, to the extent the Company or such Restricted Subsidiary
elects, to reinvest in Additional Assets (including by means of an Investment
in Additional Assets by a Restricted Subsidiary with Net Available Cash
received by the Company or another Restricted Subsidiary or the application by
the Company of the Net Available Cash received by a Restricted Subsidiary of the
Company), in each case within 365 days (or, in the case of Foreign
Subsidiary Asset Dispositions, 545 days) from the later of such Asset
Disposition or the receipt of such Net Available Cash, provided that
such Additional Assets constitute (x) First-Priority Assets that are
concurrently with their acquisition added to the First-Priority Collateral
securing the Securities or (y) Capital Stock of a Wholly Owned Subsidiary
with assets that qualify as First-Priority Assets to the extent that such First
Priority Assets, together with any First-Priority Assets described in
clause (x), have a fair market value that is equal to or greater than the
Net Available Cash applied pursuant to this clause (A) and such
First-Priority Assets are concurrently with the acquisition added to the
First-Priority Collateral securing the Securities and provided  further
that pending the final application of any such Net Available Cash, it must be
deposited in a Notes Collateral Account and pledged as additional
First-Priority Collateral;

 

(B) second, within 365 days from the later of such Asset
Disposition or the receipt of such Net Available Cash (or, in the case of
Foreign Subsidiary Asset Dispositions, 545 days), to the extent of the
balance of such Net Available Cash after such application in accordance with
clause (A), to make an Offer (as defined below) to purchase First-Priority
Obligations pursuant to and subject to the conditions set forth in
Section 4.06(c); and

 

(C) third, to the extent of the balance of such Net Available Cash
after application in accordance with clauses (A) (other than the second
proviso thereto) and (B), for any general corporate purpose not restricted by
the terms of this Indenture.

 

(b) The Company will not, and
will not permit any Restricted Subsidiary to, make any Asset Disposition (other
than an Asset Disposition of First-Priority Collateral) unless:

 

(i) the Company or such Restricted Subsidiary receives consideration
(including by way of relief from, or by any other Person assuming sole
responsibility for, any liabilities, contingent or otherwise) at the time of
such Asset Disposition at least equal to the fair market value of the Capital
Stock and assets subject to such Asset Disposition, (ii) at least 75% of the
consideration thereof received by the Company or such Restricted Subsidiary is
in the form of

 

52

 

(A) cash
or Temporary Cash Investments, (B) properties and assets to be owned by
the Company or any Restricted Subsidiary and used in a Permitted Business or
(C) Capital Stock in one or more Persons engaged in a Permitted Business
that are or thereby become Restricted Subsidiaries of the Company, and (iii) an
amount equal to 100% of the Net Available Cash from such Asset Disposition is
applied by the Company (or such Restricted Subsidiary, as the case may be):

 

(A) first, (i) to the extent the Company elects (or is required by
the terms of any Indebtedness), to prepay, repay, redeem or purchase any Credit
Agreement Obligations or any Indebtedness Incurred by a Subsidiary of the
Company that is not a Note Guarantor, or (ii) to the extent the Company or
such Restricted Subsidiary elects, to reinvest in Additional Assets (including
by means of an Investment in Additional Assets by a Restricted Subsidiary with
Net Available Cash received by the Company or another Restricted Subsidiary or
the application by the Company of the Net Available Cash received by a
Restricted Subsidiary of the Company), in each case within 365 days (or,
in the case of Foreign Subsidiary Asset Dispositions, 545 days) from the
later of such Asset Disposition or the receipt of such Net Available Cash, provided
that pending the final application of any such Net Available Cash, the Company
and its Restricted Subsidiaries may temporarily reduce Indebtedness or
otherwise invest such Net Available Cash in any manner not prohibited by this
Indenture;

 

(B) second, within 365 days from the later of such Asset
Disposition or the receipt of such Net Available Cash (or, in the case of
Foreign Subsidiary Asset Dispositions, 545 days), to the extent of the
balance of such Net Available Cash after such application in accordance with
clause (A), to make an Offer (as defined below) to purchase Securities
pursuant to and subject to the conditions set forth in Section 4.06(c); provided,
however, that if the Company elects (or is required by the terms of any
other Senior Indebtedness) such Offer may be made ratably to purchase the
Securities and such other Senior Indebtedness of the Company; and

 

(C) third, to the extent of the balance of such Net Available Cash
after application in accordance with clauses (A) (other than the proviso
thereof) and (B), for any general corporate purpose not restricted by the terms
of this Indenture;

 

provided, however, that in connection with any prepayment, repayment
or purchase of Indebtedness pursuant to clause (A) or (B) above, the
Company or such Restricted Subsidiary shall retire such Indebtedness and shall
cause the related loan commitment (if any) to be permanently reduced in an
amount equal to the principal amount so prepaid, repaid or purchased.

 

Notwithstanding
the foregoing provisions of this Section 4.06, the Company and the
Restricted Subsidiaries shall not be required to apply any Net Available Cash
from Asset Dispositions that are not Asset Dispositions of First-Priority
Collateral in accordance with this Section 4.06 except to the extent that
the aggregate Net Available

 

53

 

Cash from all such Asset Dispositions since the Closing Date that is
not applied in accordance with this Section 4.06 exceeds $10.0 million
since the Closing Date.

 

For the
purposes of this Section 4.06, the following are deemed to be cash:  (A) the assumption of any liabilities
of the Company (other than Disqualified Stock of the Company) or any Restricted
Subsidiary and the release of the Company or such Restricted Subsidiary from
all liability on such liabilities in connection with such Asset Disposition; provided
that, with respect to any Asset Disposition of First-Priority Collateral, such
liabilities constituted Trade Payables or First-Priority Obligations and
(B) securities received by the Company or any Restricted Subsidiary from
the transferee that are promptly converted by the Company or such Restricted
Subsidiary into cash.

 

For the
purposes of this Section 4.06, any sale by the Company or a Restricted
Subsidiary of the Capital Stock of a Note Guarantor that owns assets
constituting First-Priority Collateral or Second-Priority Collateral shall be
deemed to be a sale of such First-Priority Collateral or Second-Priority
Collateral (or, in the event of a Note Guarantor that owns assets that include
both First-Priority Collateral and Second-Priority Collateral, a separate sale
of such First-Priority Collateral and a separate sale of such Second-Priority
Collateral).  In the event of any such
sale (or a sale of assets that includes both First-Priority Collateral and
Second-Priority Collateral), the proceeds received by the Company and the Restricted
Subsidiaries in respect of such sale shall be allocated to the First-Priority
Collateral and the Second-Priority Collateral in accordance with their
respective fair market values, which shall be determined by Board of Directors
or an independent third party as provided by the terms of the Intercreditor
Agreement.

 

(c) In the event of an Asset
Disposition that requires the purchase of Securities (and other Senior
Indebtedness) pursuant to Section 4.06(a)(iv)(B) or 4.06(b)(iii)(B), the
Company shall be required to purchase Securities (and other Senior
Indebtedness) tendered pursuant to an offer by the Company for the Securities
(and other Senior Indebtedness) (the “Offer”) at a purchase price of 100% of
their Accreted Value or principal amount plus accrued and unpaid interest,
including Additional Interest, if any, to the date of purchase (subject to the
right of Holders of record on the relevant record date to receive interest due
on the relevant interest payment date) in accordance with the procedures
(including proration in the event of oversubscription) set forth in
Section 4.06(d).  If the aggregate
purchase price of Securities (and other Senior Indebtedness) tendered pursuant
to the Offer is less than the Net Available Cash allotted to the purchase of
the Securities (and other Senior Indebtedness), the Company shall apply the
remaining Net Available Cash for any general corporate purpose not restricted
by the terms of this Indenture.  The
Company shall not be required to make an Offer for Securities (and other Senior
Indebtedness) pursuant to this Section 4.06 if the Net Available Cash
available therefor (after application of the proceeds as provided in
Section 4.06(a)(iv)(A) or 4.06(b)(iii)(A)) is less than $10.0 million
for any particular Asset Disposition since the Closing Date (which lesser
amount shall be carried forward for purposes of determining whether an Offer is
required with respect to the Net Available Cash from any subsequent Asset
Disposition).  Upon completion of the
Offer, the amount of Net Available Cash shall be reduced to zero.

 

54

 

(d) (i)  Promptly,
and in any event within 10 days after the Company becomes obligated to
make an Offer, the Company shall be obligated to deliver to the Trustee and
send, by first-class mail to each Holder, a written notice stating that the
Holder may elect to have his Securities purchased by the Company either in
whole or in part (subject to proration as hereinafter described in the event
the Offer is oversubscribed) in integral multiples of $1,000 of principal
amount at maturity, at the applicable purchase price.  The notice shall specify a purchase date not less than
30 days nor more than 60 days after the date of such notice (the
“Purchase Date”) and shall contain such information concerning the business of
the Company which the Company in good faith believes will enable such Holders
to make an informed decision (which at a minimum shall include (1) the
most recently filed Annual Report on Form 10-K (including audited consolidated
financial statements) of the Company, the most recent subsequently filed
Quarterly Report on Form 10-Q and any Current Report on Form 8-K of the Company
filed subsequent to such Quarterly Report, other than Current Reports describing
Asset Dispositions otherwise described in the offering materials (or
corresponding successor reports), (2) a description of material
developments in the Company’s business subsequent to the date of the latest of
such reports, and (3) if material, appropriate pro forma financial
information) and all instructions and materials necessary to tender Securities
pursuant to the Offer, together with the address referred to in
clause (d)(iii).

 

(ii) Not later than the date upon which written notice of an Offer is
delivered to the Trustee as provided above, the Company shall deliver to the
Trustee an Officers’ Certificate as to (1) the amount of the Offer (the
“Offer Amount”), (2) the allocation of the Net Available Cash from the
Asset Dispositions pursuant to which such Offer is being made and (3) the
compliance of such allocation with the provisions of Section 4.06(a) and
Section 4.06(b), as applicable.  By no
later than 11:00 a.m. New York City time on the Purchase Date, the Company
shall irrevocably deposit with the Trustee or with a paying agent (or, if the
Company is acting as its own paying agent, segregate and hold in trust) an
amount equal to the Offer Amount or, if less, the purchase price of Securities
(and other Senior Indebtedness) tendered and accepted for payment in the
Offer.  Upon the expiration of the
period for which the Offer remains open (the “Offer Period”), the Company shall
deliver to the Trustee for cancelation the Securities or portions thereof that
have been properly tendered to and are to be accepted by the Company.  The Trustee (or the Paying Agent, if not the
Trustee) shall, on the date of purchase, mail or deliver payment to each
tendering Holder in the amount of the purchase price.

 

(iii) Holders electing to have a Security purchased shall be required
to surrender the Security, with an appropriate form duly completed, to the
Company at the address specified in the notice at least three Business Days
prior to the Purchase Date.  Holders
shall be entitled to withdraw their election if the Trustee or the Company
receives not later than one Business Day prior to the Purchase Date, a
telegram, telex, facsimile transmission or letter setting forth the name of the
Holder, the principal amount at maturity of the Security which was delivered by
the Holder for purchase and a statement that such Holder is withdrawing his

 

55

 

election to
have such Security purchased.  If at the
expiration of the Offer Period the aggregate principal amount at maturity of
Securities and any other Senior Indebtedness included in the Offer surrendered
by holders thereof exceeds the Offer Amount, the Company shall select the
Securities and other Senior Indebtedness to be purchased on a pro rata basis
(with such adjustments as may be deemed appropriate by the Company so that only
Securities and other Senior Indebtedness in denominations of $1,000 principal
amount at maturity, or integral multiples thereof, shall be purchased).  Holders whose Securities are purchased only
in part will be issued new Securities equal in principal amount at maturity to
the unpurchased portion of the Securities surrendered.

 

(iv) At the time the Company delivers Securities to the Trustee which
are to be accepted for purchase, the Company shall also deliver an Officers’
Certificate stating that such Securities are to be accepted by the Company
pursuant to and in accordance with the terms of this Section.  A Security shall be deemed to have been
accepted for purchase at the time the Trustee, directly or through an agent,
mails or delivers payment therefor to the surrendering Holder.

 

(v) The Company shall comply, to the extent applicable, with the
requirements of Section 14(e) of the Exchange Act and any other securities
laws or regulations in connection with the repurchase of Securities pursuant to
this Section.  To the extent that the
provisions of any securities laws or regulations conflict with provisions of
this Section, the Company shall comply with the applicable securities laws and
regulations and shall not be deemed to have breached its obligations under this
Section by virtue thereof.

 

SECTION 4.07. 
Limitation on Transactions with Affiliates.  (a) The Company shall not, and shall
not permit any Restricted Subsidiary to, directly or indirectly, enter into or
conduct any transaction (including, the purchase, sale, lease or exchange of
any property or the rendering of any service) with any Affiliate of the Company
(an “Affiliate Transaction”) unless such Affiliate Transaction is on terms (i) that
are no less favorable to the Company or such Restricted Subsidiary, as the case
may be, than those that could be obtained at the time of such transaction in
arm’s-length dealings with a Person who is not such an Affiliate,
(ii) that, in the event that such Affiliate Transaction involves an
aggregate amount in excess of $5.0 million, (1) are set forth in
writing and (2) except as provided in Section 4.07(a)(iii), have been
approved by a majority of the members of the Board of Directors having no
personal stake in such Affiliate Transaction (if any such members exist) and
(iii) that, in the event (1) such Affiliate Transaction involves an amount
in excess of $10.0 million, or (2) if there are no members of the
Board of Directors having no personal stake in such Affiliate Transaction and
such Affiliate Transaction involves an aggregate amount in excess of
$5.0 million, have been determined by a nationally recognized appraisal,
accounting or investment banking firm to be fair, from a financial standpoint,
to the Company and its Restricted Subsidiaries.

 

(b) The provisions of
Section 4.07(a) shall not prohibit (i) any Restricted Payment
permitted to be paid pursuant to Section 4.04, (ii) any issuance of
securities, or

 

56

 

other payments awards or grants in cash, securities or otherwise
pursuant to, or the funding of, employment arrangements, options to purchase
Capital Stock of the Company and equity ownership, restricted stock plans,
long-term incentive plans, stock appreciation rights plans, participation plans
or similar employee benefits plans approved by the Board of Directors,
(iii) the grant of options (and the exercise thereof) to purchase Capital
Stock of the Company or similar rights to employees and directors of the
Company pursuant to plans approved by the Board of Directors, (iv) loans
or advances to officers, directors or employees in the ordinary course of
business, but in any event not to exceed $2.0 million in the aggregate
outstanding at any one time with respect to all loans and advances made since
the Closing Date, (v) the payment of reasonable fees to directors of the
Company and its Subsidiaries who are not employees of the Company or its
Subsidiaries and other reasonable fees, compensation, benefits and indemnities
paid or entered into by the Company or its Restricted Subsidiaries in the
ordinary course of business to or with the officers, directors or employees of
the Company and its Restricted Subsidiaries, (vi) any transaction between
the Company and a Restricted Subsidiary or between Restricted Subsidiaries,
(vii) the provision by Persons who may be deemed Affiliates or
stockholders of the Company (other than J.P. Morgan Partners, LLC and Persons
directly or indirectly controlled by J.P. Morgan Partners, LLC) of investment
banking, commercial banking, trust, lending or financing, investment,
underwriting, placement agent, financial advisory or similar services to the
Company or its Subsidiaries performed after the Closing Date, (viii) sales
of Capital Stock to Permitted Holders approved by a majority of the members of
the Board of Directors who do not have a material direct or indirect financial
interest in or with respect to the transaction being considered, or
(ix) the existence or performance by the Company or any Restricted
Subsidiary under any agreement as in effect as of the Closing Date or
replacement agreement therefor or any transaction contemplated thereby
(including pursuant to any amendment thereto or replacement agreement therefor)
so long as such amendment or replacement is not more disadvantageous to the
Holders of the Securities in any material respect than the original agreement
as in effect on the Closing Date.

 

SECTION 4.08. 
Change of Control. 
(a) Upon a Change of Control, each Holder shall have the right to
require that the Company repurchase all or any part of such Holder’s Securities
at a purchase price in cash equal to 101% of the Accreted Value or principal
amount thereof plus accrued and unpaid interest, including Additional Interest,
if any, to the date of repurchase (subject to the right of Holders of record on
the relevant record date to receive interest, including Additional Interest, if
any, due on the relevant interest payment date), in accordance with the terms
contemplated in Section 4.08(b); provided, however, that
notwithstanding the occurrence of a Change of Control, the Company shall not be
obligated to repurchase the Securities pursuant to this Section 4.08 in
the event that it has exercised its right to redeem all the Securities under
paragraph 5 of the Securities.  In
the event that at the time of such Change of Control the terms of any agreement
governing Bank Indebtedness of the Company or its Subsidiaries restrict or
prohibit the repurchase of Securities pursuant to this Section 4.08, then
prior to the mailing of the notice to Holders provided for in
Section 4.08(b) but in any event within 30 days following any Change
of Control, the Company shall (i) repay in full all such Bank Indebtedness
or offer to repay in full all such Bank Indebtedness and repay the Bank
Indebtedness of each lender who has accepted such offer or (ii) obtain the
requisite

 

57

 

consent of the lenders under such agreements to permit the repurchase
of the Securities as provided for in Section 4.08(b).

 

(b) Within 30 days
following any Change of Control (except as provided in the proviso to the first
sentence of Section 4.08(a)), the Company shall mail a notice to each
Holder with a copy to the Trustee (the “Change of Control Offer”) stating:

 

(i) that a Change of Control has occurred and that such Holder has the
right to require the Company to purchase all or a portion (in integral
multiples of $1,000 principal amount at maturity) of such Holder’s Securities
at a purchase price in cash equal to 101% of the Accreted Value or principal
amount thereof, plus accrued and unpaid interest, including Additional
Interest, if any, to the date of repurchase (subject to the right of Holders of
record on the relevant record date to receive interest, including Additional
Interest, if any, due on the relevant interest payment date);

 

(ii) the circumstances and relevant facts and financial information
regarding such Change of Control;

 

(iii) the repurchase date (which shall be no earlier than 30 days
nor later than 60 days from the date such notice is mailed); and

 

(iv) the instructions determined by the Company, consistent with this
Section, that a Holder must follow in order to have its Securities purchased.

 

(c) Holders electing to have a
Security purchased shall be required to surrender the Security, with an
appropriate form duly completed, to the Company at the address specified in the
notice at least three Business Days prior to the purchase date.  Holders shall be entitled to withdraw their
election if the Trustee or the Company receives not later than one Business Day
prior to the purchase date a telegram, telex, facsimile transmission or letter
setting forth the name of the Holder, the principal amount at maturity of the
Security which was delivered for purchase by the Holder and a statement that
such Holder is withdrawing his election to have such Security purchased.  Holders whose Securities are purchased only
in part shall be issued new Securities equal in principal amount at maturity to
the unpurchased portion of the Securities surrendered.

 

(d) On the purchase date, all
Securities purchased by the Company under this Section shall be delivered to
the Trustee for cancelation, and the Company shall pay the purchase price plus
accrued and unpaid interest, including Additional Interest, if any, to the
Holders entitled thereto.

 

(e) Notwithstanding the
foregoing provisions of this Section, the Company 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 Section 4.08(b) applicable to a Change
of Control Offer made by the Company and purchases all Securities validly
tendered and not withdrawn under such Change of Control Offer.

 

58

 

(f) At the time the Company
delivers Securities to the Trustee which are to be accepted for purchase, the
Company shall also deliver an Officers’ Certificate stating that such
Securities are to be accepted by the Company pursuant to and in accordance with
the terms of this Section 4.08.  A
Security shall be deemed to have been accepted for purchase at the time the
Trustee, directly or through an agent, mails or delivers payment therefor to
the surrendering Holder.

 

(g) Prior to any Change of
Control Offer, the Company shall deliver to the Trustee an Officers’
Certificate stating that all conditions precedent contained herein to the right
of the Company to make such offer have been complied with.

 

(h) The Company shall comply,
to the extent applicable, with the requirements of Section 14(e) of the
Exchange Act and any other securities laws or regulations in connection with the
repurchase of Securities pursuant to this Section.  To the extent that the provisions of any securities laws or
regulations conflict with provisions of this Section, the Company shall comply
with the applicable securities laws and regulations and shall not be deemed to
have breached its obligations under this Section by virtue thereof.

 

SECTION 4.09. 
Compliance Certificate. 
The Company shall deliver to the Trustee within 120 days after the
end of each fiscal year of the Company an Officers’ Certificate (which
certificate may be the same certificate required by TIA § 314(a)(4))
stating that in the course of the performance by the signers of their duties as
Officers of the Company they would normally have knowledge of any Default and
whether or not the signers know of any Default that occurred during such
period.  If they do, the certificate
shall describe the Default, its status and what action the Company is taking or
proposes to take with respect thereto. 
The Company also shall comply with TIA § 314(a)(4).

 

SECTION 4.10. 
Further Instruments and Acts.  Upon request of the Trustee, the Company shall execute and
deliver such further instruments and do such further acts as may be reasonably
necessary or proper to carry out more effectively the purpose of this
Indenture.

 

SECTION 4.11. 
Future Note Guarantors and Liens.  If, after the Closing Date, any domestic
Restricted Subsidiary shall be formed or acquired, or if any Foreign Subsidiary
shall guarantee any Indebtedness of the Company or any domestic subsidiary,
then, in either case, the Company shall, at the time, cause such Subsidiary to
(a) execute a supplemental indenture substantially in the form set forth in
Exhibit C hereto pursuant to which such Restricted Subsidiary will Guarantee
payment of the Securities, (b) execute counterparts of the Security
Documents, subject to the Intercreditor Agreement, that grant the Trustee a
first-priority Lien for the benefit of the Holders on all First-Priority Assets
owned by such Subsidiary, subject to the terms of the Security Documents, (c)
if such Subsidiary grants any Lien upon any of its property constituting
Second-Priority Collateral as security for any Credit Agreement Obligations or
any Secondary Collateral Obligations, execute a Security Document upon substantially
the same terms, but subject to the Intercreditor Agreement, that grants the
Trustee a second-priority Lien upon such property for the benefit of the
Holders, subject to the terms of such Security Document,

 

59

 

(d) in the case of clauses (b) and (c), take all such actions
(including the filing and recording of financing statements, fixture filings,
Mortgages and other documents) that may be required under any applicable law,
or which the Trustee may reasonably request, to create and perfect such Lien,
all at the expense of the Company and the Note Guarantors, including all
reasonable fees and expenses of counsel incurred by the Trustee in connection
therewith, and (e) deliver to the Trustee an Opinion of Counsel, reasonably
satisfactory to the Trustee, that such supplemental indenture and any such
Security Documents, as the case may be, are valid and binding obligations of
such Subsidiary enforceable against such Subsidiary in accordance with their terms,
subject to customary exceptions, including exceptions for bankruptcy,
fraudulent conveyance and equitable principles.  Notwithstanding the foregoing, if granting the Lien described in
clause (b) above is not permitted in any respect by the terms of any
encumbrance or restriction described in Section 4.05(d), the Subsidiary will
not be required to grant such Lien to the extent not so permitted.  Further, if granting the Lien described in
clause (c) above requires the consent of a third party, such Subsidiary will
use commercially reasonable efforts to obtain such consent with respect to the
second-priority Lien, for the benefit of the Trustee, but if the third party
does not consent to the granting of the second-priority Lien, after the use of
commercially reasonable efforts, such Subsidiary will not be required to do
so.  Also, if a Lien described in clause
(b) or (c) cannot be granted or perfected under applicable law, the Subsidiary
will not be required to grant such Lien.

 

From and after
the Closing Date, if the Company or any Note Guarantor creates any additional
security interest (other than Permitted Liens described in
clauses (b)-(aa) of the definition thereof) upon any Second-Priority
Collateral to secure any Credit Agreement Obligations or any Secondary
Collateral Obligations, it shall concurrently grant a second-priority Lien
(subject to Permitted Liens) upon such property as security for the Securities
ratably with any other Secondary Collateral Obligations to be secured thereby
by (i) executing Security Documents that grant the Trustee a second-priority
Lien upon such property for the benefit of the Holders upon substantially the
same terms as those that create such additional security interests, but subject
to the Intercreditor Agreement, and (ii) take all such actions (including the
filing and recording of financing statements, fixture filings, Mortgages and
other documents) that may be required under any applicable law, or which the
Trustee may reasonably request to create and perfect such second-priority Lien,
all at the expense of the Company and the Note Guarantors, including all
reasonable fees and expenses of counsel incurred by the Trustee in connection
therewith; provided that the Company or such Note Guarantor shall not be
required to grant a second-priority Lien upon such property as security for the
Securities if (x) a second-priority Lien in such property cannot be granted or
perfected under applicable law or (y) such grant requires the consent of any
third party, which consent the Company or such Note Guarantor is unable to
obtain using commercially reasonable efforts.

 

In addition,
the Company and each Note Guarantor shall, with respect to each parcel of real
property in the United States acquired by the Company or any Note Guarantor
after the Closing Date, use commercially reasonable efforts to deliver to the
Collateral Agent, for the benefit of or addressed to the Trustee or the
Collateral Agent, as applicable, the following:

 

60

 

(a) a fully executed,
acknowledged, and recorded Mortgage similar to those provided for the benefit
of the Collateral Agent on the Closing Date and subject to the terms of the
Intercreditor Agreement;

 

(b) an opinion of local counsel
in a form substantially similar to those provided for the benefit of the
Collateral Agent on the Closing Date, or otherwise reasonably acceptable to the
Trustee;

 

(c) a fully-paid title
insurance policy in a form substantially similar to the title insurance
policies delivered to the Collateral Agent on the Closing Date with no
exceptions other than (i) Permitted Liens and (ii) other changes reasonably
acceptable to the Trustee; and

 

(d) the most recent survey of
each property together with either (i) an updated survey certification from the
applicable surveyor stating that, based on a visual inspection of the property
and the knowledge of the surveyor, there has been no change in the facts
depicted in the survey or (ii) an affidavit from the Company and the Note
Guarantors stating that there has been no change, other than, in each case,
changes reasonably acceptable to the Trustee, in the facts depicted in the
survey.

 

The Company
shall provide each of the foregoing described in clauses (a) through (d) above
at its own expense and shall pay all reasonable fees and expenses of counsel
incurred by the Trustee in connection with each of the foregoing.

 

SECTION 4.12. 
Limitation on Lines of Business.  The Company shall not, and shall not permit any Restricted
Subsidiary to, engage in any business, other than a Permitted Business, except
that the Company and any of its Restricted Subsidiaries may engage in a new
business so long as the Company and its Restricted Subsidiaries, taken as a
whole, remain substantially engaged in a Permitted Business.

 

SECTION 4.13. 
Limitation on Liens. 
The Company shall not, and shall not permit any of its Restricted
Subsidiaries to, directly or indirectly, create, incur, assume or suffer to
exist any Lien of any kind on any asset now owned or hereafter acquired by the
Company or its Restricted Subsidiaries, except Permitted Liens.

 

SECTION 4.14. 
Material After-Acquired Property.  Upon the acquisition by the Company or any
Note Guarantor of any Material After-Acquired Property (or the formation or
acquisition of any Note Guarantor that holds Material After-Acquired Property),
the Company or such Note Guarantor shall execute and deliver such mortgages,
deeds of trust, security instruments, financing statements and certificates and
opinions of counsel as shall be reasonably necessary or requested by the
Trustee to vest in the Trustee a perfected first-priority security interest
(subject to Permitted Liens) in such Material After-Acquired Property and to
have such Material After-Acquired Property added to the First-Priority
Collateral, and thereupon all provisions of this Indenture relating to
First-Priority Collateral shall be deemed to relate to such Material
After-Acquired Property to the same extent and with the same force and effect.

 

61

 

ARTICLE V

 

Successor Company

 

SECTION 5.01. 
When Company May Merge or Transfer Assets.  (a)  The Company shall not
consolidate with or merge with or into, or convey, transfer or lease all or
substantially all its assets to, any Person, unless:

 

(i) the resulting, surviving or transferee Person (the “Successor
Company”) shall be a corporation organized and existing under the laws of the
United States of America, any State thereof or the District of Columbia
and the Successor Company (if not the Company) 
shall expressly assume, by a supplemental indenture hereto, executed and
delivered to the Trustee, in form satisfactory to the Trustee, all the
obligations of the Company under the Securities and this Indenture;

 

(ii) immediately after giving effect to such transaction (and treating
any Indebtedness which becomes an obligation of the Successor Company or any
Restricted Subsidiary as a result of such transaction as having been Incurred
by the Successor Company or such Restricted Subsidiary at the time of such
transaction), no Default shall have occurred and be continuing;

 

(iii) immediately after giving effect to such transaction, the
Successor Company would be able to Incur an additional $1.00 of Indebtedness
pursuant to Section 4.03(a); and

 

(iv) the Company shall have delivered to the Trustee an Officers’
Certificate and an Opinion of Counsel, each stating that such consolidation,
merger or transfer and such supplemental indenture (if any) comply with this
Indenture.

 

The Successor
Company shall succeed to, and be substituted for, and may exercise every right
and power of, the Company under this Indenture, but the predecessor Company in
the case of a conveyance, transfer or lease of all or substantially all its
assets shall not be released from the obligation to pay the principal of and
interest on the Securities.

 

(b) The Company shall not
permit any Note Guarantor to consolidate with or merge with or into, or convey,
transfer or lease all or substantially all its assets to, any Person, unless
either:

 

(i)  (1) the resulting,
surviving or transferee Person will be a corporation, partnership or limited
liability company organized and existing under the laws of the United States of
America, any State thereof or the District of Columbia, and such Person (if not
such Note Guarantor) shall expressly assume, by a supplemental indenture,
executed and delivered to the Trustee, in form satisfactory to the Trustee, all
the obligations of such Note Guarantor under its Note Guarantee; (2) immediately
after giving effect to such transaction (and

 

62

 

treating any
Indebtedness which becomes an obligation of the resulting, surviving or
transferee Person or any Restricted Subsidiary as a result of such transaction
as having been Incurred by such Person or such Restricted Subsidiary at the
time of such transaction), no Default shall have occurred and be continuing;
and (3) the Company shall have delivered to the Trustee an Officers’
Certificate and an Opinion of Counsel, each stating that such consolidation,
merger or transfer and such supplemental indenture (if any) comply with this
Indenture; or

 

(ii) such transaction results in the Company receiving cash or other
property (other than Capital Stock representing a controlling interest in the
successor entity), and the transaction is made in compliance with
Section 4.06.

 

(c) Notwithstanding the
foregoing, (i) any Restricted Subsidiary may consolidate with, merge into
or transfer or lease all or part of its properties and assets to the Company or
a Subsidiary that is a Note Guarantor and (ii) the Company may merge with an
Affiliate incorporated solely for (1) the purpose of incorporating the
Company or (2) organizing the Company in another jurisdiction to realize tax or
other benefits.

 

ARTICLE VI

 

Defaults and Remedies

 

SECTION 6.01. 
Events of Default. 
An “Event of Default” occurs if:

 

(a) the Company defaults in any
payment of interest on any Security or in any payment of Additional Interest,
in each case, when the same becomes due and payable and such default continues
for a period of 30 days;

 

(b) the Company
(i) defaults in the payment of Accreted Value or the principal of any
Security when the same becomes due and payable at its Stated Maturity, upon required
redemption or repurchase, upon declaration or otherwise or (ii) fails to
redeem or purchase Securities when required pursuant to this Indenture or the
Securities;

 

(c) the Company or any Note
Guarantor fails to comply with Section 5.01;

 

(d) the Company or any
Restricted Subsidiary fails to comply with Section 4.02, 4.03, 4.04, 4.05,
4.06, 4.07, 4.08, 4.11, 4.12, 4.13, or 4.14 (other than a failure to purchase
Securities when required under Section 4.06 or 4.08) and such failure
continues for 45 days after the written notice specified below;

 

(e) the Company or any
Restricted Subsidiary fails to comply with any of its agreements in the
Securities, this Indenture or any Security Document (other than those referred
to in (a), (b), (c) or (d) above) and such failure continues for
60 days after the written notice specified below;

 

(f) the principal amount of any
Indebtedness of the Company or any Restricted Subsidiary is not paid within any
applicable grace period after final maturity or

 

63

 

the acceleration by the holders thereof because of a default and the
aggregate principal amount of such Indebtedness unpaid or accelerated exceeds
$10.0 million or its foreign currency equivalent at the time and such failure
continues for 30 days after the written notice specified below;

 

(g) the Company or any
Significant Subsidiary pursuant to or within the meaning of any Bankruptcy Law:

 

(i) commences a voluntary case;

 

(ii) consents to the entry of an order for relief against it in an
involuntary case;

 

(iii) consents to the appointment of a Custodian of it or for any
substantial part of its property; or

 

(iv) makes a general assignment for the benefit of its creditors; or
takes any comparable action under any foreign laws relating to insolvency;

 

(h) a court of competent
jurisdiction enters an order or decree under any Bankruptcy Law that:

 

(i) is for relief against the Company or any Significant Subsidiary in
an involuntary case;

 

(ii) appoints a Custodian of the Company or any Significant Subsidiary
or for any substantial part of its property; or

 

(iii) orders the winding up or liquidation of the Company or any
Significant Subsidiary;

 

or any similar
relief is granted under any foreign laws and the order or decree remains
unstayed and in effect for 60 days;

 

(i) any judgment or decree for
the payment of money in excess of $10.0 million (net of any amounts with
respect to which a reputable and creditworthy insurance company has
acknowledged liability in writing) or its foreign currency equivalent against
the Company or a Restricted Subsidiary if such judgment or decree becomes final
and nonappealable and remains outstanding for a period of 60 days following
such judgment and is not discharged, waived or the execution thereof stayed; or

 

(j) (1) any Note Guarantee, or
any Security Document executed by, or any security interest granted thereunder
by a Note Guarantor that is a Material Subsidiary ceases to be in full force
and effect (except as contemplated by the terms of this Indenture, the Security
Documents, the Intercreditor Agreement or the Note Guarantees), except (i) as a
result of (A) the Credit Agent’s or Trustee’s failure to take any action
reasonably requested by the Company in order to maintain a valid and perfected
Lien on any Collateral or (B) any action taken by the Credit Agent or Trustee
to release any Lien

 

64

 

on any Collateral or (ii) Liens on any item of Collateral with a fair
market value not exceeding $500,000, (2) any Note Guarantor or Person acting by
or on behalf of such Note Guarantor denies or disaffirms its obligations under
this Indenture, any Note Guarantee or any Security Document and, in each case,
such Default continues for 10 days after the written notice specified
below or (3) the Intercreditor Agreement ceases to be in full force and
effect (except as contemplated hereunder or by the terms of the Security
Documents, the Intercreditor Agreement or the Note Guarantees).

 

The foregoing
shall constitute Events of Default whatever the reason for any such Event of
Default and whether it is voluntary or involuntary or is effected by operation
of law or pursuant to any judgment, decree or order of any court or any order,
rule or regulation of any administrative or governmental body.

 

The term
“Bankruptcy Law” means Title 11, United States Code, or any
similar Federal or state law for the relief of debtors.  The term “Custodian” means any receiver,
trustee, assignee, liquidator, custodian or similar official under any
Bankruptcy Law.

 

A Default
under clause (d), (e), (f) or (j) above is not an Event of
Default until the Trustee or the Holders of at least 25% in principal amount at
maturity of the outstanding Securities notify the Company of the Default and
the Company or the Note Guarantor, as applicable, does not cure such Default
within the time specified after receipt of such notice.  Such notice must specify the Default, demand
that it be remedied and state that such notice is a “Notice of Default”.

 

The Company
shall deliver to the Trustee, within 30 days after the occurrence thereof,
written notice in the form of an Officers’ Certificate of any event which is,
or with the giving of notice or the lapse of time or both would become, an
Event of Default, its status and what action the Company is taking or proposes
to take with respect thereto.

 

SECTION 6.02. 
Acceleration.  If
an Event of Default (other than an Event of Default specified in
Section 6.01(g) or (h) with respect to the Company) occurs and is
continuing, the Trustee or the Holders of at least 25% in principal amount at
maturity of the outstanding Securities by written notice (specifying the Event
of Default and stating that the notice is a “notice of acceleration”) to the
Company and the Trustee may declare the principal of and accrued but unpaid
interest (including Additional Interest, if any) on all the Securities to be
due and payable.  Upon such a
declaration, such principal and interest (including Additional Interest, if
any) shall be due and payable immediately. 
If an Event of Default specified in Section 6.01(g) or
(h) with respect to the Company occurs, the principal of and interest
(including Additional Interest, if any) on all the Securities shall ipso
facto become and be immediately due and payable without any declaration
or other act on the part of the Trustee or any Holders and if such Event of
Default occurs prior to the earlier of (i) the Cash Election Date and
(ii) December 15, 2006, the Company will thereafter be obligated to pay
cash interest on each subsequent interest payment date and the Securities will
cease to accrete.  The Holders of a
majority in principal amount at maturity of the Securities by notice to the
Trustee may rescind an

 

65

 

acceleration and its consequences if the rescission would not conflict
with any judgment or decree and if all existing Events of Default have been
cured or waived except nonpayment of principal or interest that has become due
solely because of acceleration.  No such
rescission shall affect any subsequent Default or impair any right consequent
thereto.

 

SECTION 6.03. 
Other Remedies.  If
an Event of Default occurs and is continuing, the Trustee may pursue any
available remedy to collect the payment of principal of or interest on the
Securities or to enforce the performance of any provision of the Securities or
this Indenture.

 

The Trustee
may maintain a proceeding even if it does not possess any of the Securities or
does not produce any of them in the proceeding.  A delay or omission by the Trustee or any Holder 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.  No remedy is exclusive of any
other remedy.  All available remedies
are cumulative.

 

SECTION 6.04. 
Waiver of Past Defaults. 
The Holders of a majority in principal amount at maturity of the
Securities by notice to the Trustee may waive an existing Default and its consequences
except (a) a Default in the payment of the principal of or interest on a
Security, (b) a Default arising from the failure to redeem or purchase any
Security when required pursuant to the terms of this Indenture or (c) a
Default in respect of a provision that under Section 9.02 cannot be
amended without the consent of each Holder affected.  When a Default is waived, it is deemed cured, but no such waiver
shall extend to any subsequent or other Default or impair any consequent right.

 

SECTION 6.05. 
Control by Majority. 
The Holders of a majority in principal amount at maturity of the
Securities may direct the time, method and place of conducting any proceeding
for any remedy available to the Trustee or of exercising any trust or power
conferred on the Trustee.  However, the
Trustee may refuse to follow any direction that conflicts with law or this
Indenture or, subject to Section 7.01, that the Trustee determines is
unduly prejudicial to the rights of other Holders or would involve the Trustee
in personal liability; provided, however, that the Trustee may
take any other action deemed proper by the Trustee that is not inconsistent
with such direction.  Prior to taking
any action hereunder, the Trustee shall be entitled to indemnification satisfactory
to it in its sole discretion against all losses and expenses caused by taking
or not taking such action.

 

SECTION 6.06. 
Limitation on Suits. 
(a)  Except to enforce the right to receive payment of
principal, premium (if any) or interest when due, no Holder may pursue any
remedy with respect to this Indenture or the Securities unless:

 

(i) the Holder gives to the Trustee written notice stating that an
Event of Default is continuing;

 

66

 

(ii) the Holders of at least 25% in principal amount at maturity of the
Securities make a written request to the Trustee to pursue the remedy;

 

(iii) such Holder or Holders offer to the Trustee reasonable security
or indemnity against any loss, liability or expense;

 

(iv) the Trustee does not comply with the request within 60 days
after receipt of the request and the offer of security or indemnity; and

 

(v) the Holders of a majority in principal amount at maturity of the
Securities do not give the Trustee a direction inconsistent with the request
during such 60-day period.

 

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

 

SECTION 6.07. 
Rights of Holders to Receive Payment.  Notwithstanding any other provision of this
Indenture, the right of any Holder to receive payment of principal of and
interest, including Additional Interest, if any, on the Securities held by such
Holder, on or after the respective due dates expressed or provided for in the
Securities, 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 6.08. 
Collection Suit by Trustee.  If an Event of Default specified in Section 6.01(a) or
(b) occurs and is continuing, the Trustee may recover judgment in its own
name and as trustee of an express trust against the Company or any other
obligor on the Securities for the whole amount then due and owing (together
with interest on overdue principal and (to the extent lawful) on any unpaid
interest at the rate provided for in the Securities) and the amounts provided
for in Section 7.07.

 

SECTION 6.09. 
Trustee May File Proofs of Claim.  The Trustee may 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 and the Holders allowed in any judicial proceedings
relative to the Company, any Subsidiary or Note Guarantor, their creditors or
their property and, unless prohibited by law or applicable regulations, may
vote on behalf of the Holders in any election of a trustee in bankruptcy or
other Person performing similar functions, and any Custodian in any such
judicial proceeding is hereby authorized by each Holder to make 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 it for
the reasonable compensation, expenses, disbursements and advances of the
Trustee, its agents and its counsel, and any other amounts due the Trustee
under Section 7.07.

 

SECTION 6.10. 
Priorities. 
Subject to the terms of the Intercreditor Agreement, if the Trustee
collects any money or property pursuant to this Article 6, it shall pay
out the money or property in the following order:

 

FIRST:  to the Trustee for amounts due under
Section 7.07;

 

67

 

SECOND:  to Holders for amounts due and unpaid on the
Securities for principal and interest, ratably, and any Additional Interest,
without preference or priority of any kind, according to the amounts due and
payable on the Securities for principal and interest, including any Additional
Interest, respectively; and

 

THIRD:  to the Company.

 

The Trustee
may fix a record date and payment date for any payment to Holders pursuant to
this Section.  At least 15 days
before such record date, the Trustee shall mail to each Holder and the Company
a notice that states the record date, the payment date and amount to be paid.

 

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 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 and expenses, 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 does not
apply to a suit by the Trustee, a suit by a Holder pursuant to
Section 6.07 or a suit by Holders of more than 10% in principal amount at
maturity of the Securities.

 

SECTION 6.12. 
Waiver of Stay or Extension Laws.  Neither the Company nor any Note Guarantor
(to the extent it may lawfully do so) shall at any time insist upon, or plead,
or in any manner whatsoever claim or take the benefit or advantage of, any stay
or extension law wherever enacted, now or at any time hereafter in force, which
may affect the covenants or the performance of this Indenture; and the Company
and each Note Guarantor (to the extent that it may lawfully do so) hereby
expressly waives all benefit or advantage of any such law, and shall not
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 had been enacted.

 

ARTICLE VII

 

Trustee

 

SECTION 7.01. 
Duties of Trustee. 
(a)  If an Event of Default has occurred and is continuing,
the Trustee shall exercise the rights and powers vested in it by this Indenture
and use the same degree of care and skill in their exercise as a prudent person
would exercise or use under the circumstances in the conduct of such person’s
own affairs.

 

(b) Except during the
continuance of an Event of Default:

 

(i) the Trustee undertakes to perform such duties and only such duties
as are specifically set forth in this Indenture and no implied covenants or
obligations shall be read into this Indenture against the Trustee; and

 

68

 

(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, with respect to any certificate or
opinions required to be furnished to it hereunder, the Trustee shall examine
the certificates and opinions to determine whether or not they conform to the
requirements of this Indenture (but need not confirm or investigate the
accuracy of mathematical calculations or other facts stated therein).

 

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

 

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

 

(ii) the Trustee shall not be liable for any error of judgment made in
good faith by a Trust Officer 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 6.05.

 

(iv) No provision of this Indenture shall require the Trustee to expend
or risk its own funds or otherwise incur financial liability in the performance
of any of its duties hereunder or in the exercise of any of its rights or
powers, if it shall have reasonable grounds to believe that repayment of such
funds or adequate indemnity against such risk or liability is not reasonably
assured to it.

 

(d) Every provision of this
Indenture that in any way relates to the Trustee is subject to
paragraphs (a), (b) and (c) of this Section.

 

(e) The Trustee shall not be
liable for interest on any money received by it except as the Trustee may agree
in writing with the Company.

 

(f) Money held in trust by the
Trustee need not be segregated from other funds except to the extent required
by law.

 

(g) Every provision of this
Indenture relating to the conduct or affecting the liability of or affording
protection to the Trustee shall be subject to the provisions of this Section
and to the provisions of the TIA.

 

SECTION 7.02. 
Rights of Trustee. 
(a)  The Trustee may conclusively rely on any document
(whether in its original or facsimile form) 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, it may require an Officers’ Certificate or an Opinion of
Counsel.  The Trustee shall not be
liable for any

 

69

 

action it takes or omits to
take in good faith in reliance on the Officers’ Certificate or Opinion of
Counsel.

 

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

 

(d) The Trustee shall not be
liable for any action it takes or omits to take in good faith which it believes
to be authorized or within its rights or powers; provided, however,
that the Trustee’s conduct does not constitute wilful misconduct or negligence.

 

(e) The Trustee may consult
with counsel of its selection, and the advice or opinion of such counsel with
respect to legal matters relating to this Indenture and the Securities shall be
full and complete authorization and protection from liability in respect of any
action taken, omitted or suffered by it hereunder in good faith and in
accordance with the advice or opinion of such counsel.

 

(f) 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, consent, order, approval, bond, debenture, note or other paper or
document unless requested in writing to do so by the Holders of not less than a
majority in principal amount at maturity of the Securities at the time
outstanding, but the Trustee, in its discretion, may make such further inquiry
or investigation into such facts or matters as it may see fit, and, if the
Trustee shall determine to make such further inquiry or investigation, it shall
be entitled to examine the books, records and premises of the Company,
personally or by agent or attorney at the Company’s expense and shall incur no
liability or additional liability of any kind by reason of such inquiry or
investigation.

 

(g) 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 to each
agent, custodian and other Person employed to act hereunder.

 

(h) The Trustee may request
that the Company deliver a 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 Officers’ Certificate, including any person
specified as so authorized in any certificate previously delivered and not
superseded.

 

(i) 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 pursuant to this
Indenture, unless such Holders shall have offered to the Trustee security or
indemnity reasonably satisfactory to the Trustee against the costs, expenses
and liabilities which might be incurred by it in compliance with such request
or direction.

 

SECTION 7.03. 
Individual Rights of Trustee.  The Trustee in its individual or any other capacity may become
the owner or pledgee of Securities and may otherwise deal with the Company or
its Affiliates with the same rights it would have if it

 

70

 

were not Trustee.  Any Paying Agent or Registrar may do the
same with like rights.  However, the
Trustee must comply with Sections 7.10 and 7.11.

 

SECTION 7.04. 
Trustee’s Disclaimer. 
The Trustee shall not be responsible for and makes no representation as
to the validity or adequacy of this Indenture, any Note Guarantee or the
Securities, it shall not be accountable for the Company’s use of the proceeds
from the Securities, and it shall not be responsible for any statement of the
Company or any Note Guarantor in this Indenture or in any document issued in
connection with the sale of the Securities or in the Securities other than the
Trustee’s certificate of authentication. 
The Trustee shall not be charged with knowledge of any Default or Event
of Default under Sections 6.01(c), (d), (e), (f), (i) or (j) or
of the identity of any Significant Subsidiary unless either (a) a Trust
Officer shall have actual knowledge thereof or (b) the Trustee shall have
received notice thereof in accordance with Section 12.02 hereof from the
Company, any Note Guarantor or any Holder at the Corporate Trust Office of the
Trustee, such notice referencing the Securities and this Indenture.

 

SECTION 7.05. 
Notice of Defaults. 
If a Default occurs and is continuing and if it is known to the Trustee,
the Trustee shall mail to each Holder notice of the Default within the earlier
of 90 days after it occurs or 30 days after it is actually known to a
Trust Officer or written notice of it is received by the Trustee.  Except in the case of a Default in payment
of principal of, premium (if any) or interest on any Security (including
payments pursuant to the mandatory redemption provisions of such Security, if
any), the Trustee may withhold the notice if and so long as a committee of its
Trust Officers in good faith determines that withholding the notice is in the
interests of Holders.

 

SECTION 7.06. 
Reports by Trustee to Holders.  As promptly as practicable after each May 15 beginning with May 15,
2004, and in any event prior to July 15 in each year, the Trustee shall mail to
each Holder a brief report dated as of such May 15 that complies with TIA §
313(a) if and to the extent required thereby. 
The Trustee shall also comply with TIA § 313(b) and 313(c).

 

A copy of each
report at the time of its mailing to Holders shall be filed with the SEC and
each stock exchange (if any) on which the Securities are listed.  The Company agrees to notify promptly the
Trustee whenever the Securities become listed on any stock exchange and of any
delisting thereof.

 

SECTION 7.07. 
Compensation and Indemnity.  The Company shall pay to the Trustee from time to time reasonable
compensation for its services as shall be agreed to in writing from time to
time by the Company and the Trustee. 
The Trustee’s compensation shall not be limited by any law on
compensation of a trustee of an express trust. 
The Company shall reimburse the Trustee upon request for all reasonable
out-of-pocket expenses incurred or made by it, including costs of collection,
in addition to the compensation for its services.  Such expenses shall include the reasonable compensation and
expenses, disbursements and advances of the Trustee’s agents, counsel, accountants
and experts.  The Company and each Note
Guarantor, jointly and severally, shall

 

71

 

indemnify the Trustee and any
predecessor Trustee against any and all loss, liability, claim, damage or
expense (including reasonable attorneys’ fees), including taxes (other than
taxes based upon, measured by or determined by the income of the Trustee),
incurred by or in connection with the administration of this trust and the
performance of its duties hereunder, including its duties as Collateral Agent.  The Trustee shall notify the Company of any
claim for which it may seek indemnity promptly upon obtaining actual knowledge
thereof; provided, however, that any failure so to notify the
Company shall not relieve the Company or any Note Guarantor of its indemnity
obligations hereunder.  The Company
shall defend the claim and the indemnified party shall provide reasonable
cooperation at the Company’s expense in the defense.  Such indemnified parties may have separate counsel and the
Company and the Note Guarantors, as applicable shall pay the fees and expenses
of such counsel; provided, however, that the Company shall not be
required to pay such fees and expenses if it assumes such indemnified parties’
defense and, in such indemnified parties’ reasonable judgment, there is no
conflict of interest between the Company and the Note Guarantors, as
applicable, and such parties in connection with such defense.  The Company need not reimburse any expense
or indemnify against any loss, liability or expense incurred by an indemnified
party through such party’s own wilful misconduct, negligence or bad faith or in
the case of the Collateral Agent, through its own wilful misconduct, gross
negligence or bad faith.

 

To secure the
Company’s payment obligations in this Section, the Trustee shall have a lien
prior to the Securities on all money or property held or collected by the
Trustee other than money or property held in trust to pay principal of and
interest and Additional Interest, if any, on particular Securities.

 

The Company’s
payment obligations pursuant to this Section shall survive the satisfaction or
discharge of this Indenture, any rejection or termination of this Indenture
under any bankruptcy law or the resignation or removal of the Trustee.  Without prejudice to any other rights
available to the Trustee under applicable law, when the Trustee incurs expenses
after the occurrence of a Default specified in Section 6.01(g) or
(h) with respect to the Company, the expenses are intended to constitute
expenses of administration under the Bankruptcy Law.

 

SECTION 7.08. 
Replacement of Trustee. 
(a)  The Trustee may resign at any time by so notifying the
Company.  The Holders of a majority in
principal amount at maturity of the Securities may remove the Trustee by so
notifying the Trustee and may appoint a successor Trustee.  The Company shall remove the Trustee if:

 

(i) the Trustee fails to comply with Section 7.10;

 

(ii) the Trustee is adjudged bankrupt or insolvent;

 

(iii) a receiver or other public officer takes charge of the Trustee or
its property; or

 

(iv) the Trustee otherwise becomes incapable of acting.

 

72

 

(b) If the Trustee resigns, is
removed by the Company or by the Holders of a majority in principal amount at
maturity of the Securities and such Holders do not reasonably promptly appoint
a successor Trustee, or if a vacancy exists in the office of Trustee for any
reason (the Trustee in such event being referred to herein as the retiring
Trustee), the Company shall promptly appoint a successor Trustee.

 

(c) A successor Trustee shall
deliver a written acceptance of its appointment to the retiring Trustee and to
the Company.  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. 
The retiring Trustee shall promptly transfer all property held by it as
Trustee to the successor Trustee, subject to the lien provided for in
Section 7.07.

 

(d) If a successor Trustee does
not take office within 30 days after the retiring Trustee resigns or is
removed, the retiring Trustee or the Holders of 10% in principal amount at
maturity of the Securities may petition, at the expense of the Company, any
court of competent jurisdiction for the appointment of a successor Trustee at
the expense of the Company.

 

(e) If the Trustee fails to
comply with Section 7.10, unless the Trustee’s duty to resign is stayed as
provided in TIA § 310(b), any Holder who has been a bona fide holder
of a Security for at least six months may petition any court of competent
jurisdiction for the removal of the Trustee and the appointment of a successor
Trustee.

 

(f) Notwithstanding the
replacement of the Trustee pursuant to this Section, the Company’s obligations
under Section 7.07 shall continue for the benefit of the retiring Trustee.

 

SECTION 7.09. 
Successor Trustee by Merger.  If the Trustee consolidates with, merges or converts into, or
transfers all or substantially all its corporate trust business or assets to,
another corporation or banking association, the resulting, surviving or
transferee corporation without any further act shall be the successor Trustee.

 

In case at the
time such successor or successors by merger, conversion or consolidation to the
Trustee shall succeed to the trusts created by this Indenture any of the
Securities shall have been authenticated but not delivered, any such successor
to the Trustee may adopt the certificate of authentication of any predecessor
trustee, and deliver such Securities so authenticated; and in case at that time
any of the Securities shall not have been authenticated, any successor to the
Trustee may authenticate such Securities either in the name of any predecessor
hereunder or in the name of the successor to the Trustee; and in all such cases
such certificates shall have the full force which it is anywhere in the
Securities or in this Indenture provided that the certificate of the Trustee
shall have.

 

SECTION 7.10. 
Eligibility; Disqualification.  The Trustee shall at all times satisfy the requirements of TIA
§ 310(a).  The Trustee shall have a
combined

 

73

 

capital and surplus of at least
$50,000,000 as set forth in its most recent published annual report of
condition.  The Trustee shall comply
with TIA § 310(b); subject to its right to apply for a stay of its duty to
resign under the penultimate paragraph of TIA § 310(b); provided, however,
that there shall be excluded from the operation of TIA § 310(b)(1) any
indenture or indentures under which other securities or certificates of
interest or participation in other securities of the Company are outstanding if
the requirements for such exclusion set forth in TIA § 310(b)(1) are met.

 

SECTION 7.11. 
Preferential Collection of Claims Against the Company.  The Trustee shall comply with 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.

 

ARTICLE VIII

 

Discharge of Indenture; Defeasance

 

SECTION 8.01. 
Discharge of Liability on Securities; Defeasance.  (a)When (i) all outstanding Securities
(other than Securities replaced or paid pursuant to Section 2.08) have
been canceled or delivered to the Trustee for cancelation or (ii) all
outstanding Securities have become due and payable, whether at maturity or as a
result of the mailing of a notice of redemption pursuant to Article 3
hereof, and the Company irrevocably deposits with the Trustee funds in an
amount sufficient or U.S. Government Obligations, the principal of and interest
on which will be sufficient, or a combination thereof sufficient, in the written
opinion of a nationally recognized firm of independent public accountants
delivered to the Trustee (which delivery shall only be required if U.S.
Government Obligations have been so deposited), to pay the principal of,
premium (if any) and interest and Additional Interest, if any, on the
outstanding Securities when due at maturity or upon redemption of, including
interest thereon to maturity or such redemption date (other than Securities
replaced or paid pursuant to Section 2.08) and Additional Interest, if
any, and if in the case of both clause (i) and (ii) the Company pays all
other sums payable hereunder by the Company, then this Indenture shall, subject
to Section 8.01(c), cease to be of further effect.  The Trustee shall acknowledge satisfaction
and discharge of this Indenture on demand of the Company accompanied by an
Officers’ Certificate and an Opinion of Counsel and at the cost and expense of
the Company.

 

(b) Subject to
Sections 8.01(c) and 8.02, the Company at any time may terminate
(i) all of its obligations under the Securities and this Indenture (“legal
defeasance option”) or (ii) its obligations under Sections 4.02,
4.03, 4.04, 4.05, 4.06, 4.07, 4.08, 4.11, 4.12, 4.13, 4.14 and 10.02 the
operation of Section 5.01(a)(iii), 6.01(d), 6.01(f), 6.01(g) (with respect
to Significant Subsidiaries of the Company only), 6.01(h) (with respect to
Significant Subsidiaries of the Company only) 6.01(i) and 6.01(j) (“covenant
defeasance option”).  The Company may
exercise its legal defeasance option notwithstanding its prior exercise of its
covenant defeasance option.  In the
event that the Company terminates all of its obligations under the Securities
and this Indenture by exercising its legal defeasance option or its covenant
defeasance option, the obligations

 

74

 

under the Note Guarantees shall
each be terminated simultaneously with the termination of such obligations.

 

If the Company
exercises its legal defeasance option, payment of the Securities may not be accelerated
because of an Event of Default.  If the
Company exercises its covenant defeasance option, payment of the Securities may
not be accelerated because of an Event of Default specified in
Section 6.01(d), 6.01(f), 6.01(g) (with respect to Significant
Subsidiaries only), 6.01(h) (with respect to Significant Subsidiaries only),
6.01(i) or 6.01(j) or because of the failure of the Company to comply with
Section 5.01(a)(iii).

 

Upon
satisfaction of the conditions set forth herein and upon request of the Company,
the Trustee shall acknowledge in writing the discharge of those obligations
that the Company terminates.

 

(c) Notwithstanding
clauses (a) and (b) above, the Company’s obligations in
Sections 2.04, 2.05, 2.06, 2.07, 2.08, 2.09, 7.07, 7.08, and in this
Article 8 shall survive until the Securities have been paid in full.  Thereafter, the Company’s obligations in
Sections 7.07, 8.04, 8.05, and 8.06 shall survive.

 

SECTION 8.02. 
Conditions to Defeasance. 
(a)  The Company may exercise its legal defeasance option or
its covenant defeasance option only if:

 

(i) the Company irrevocably deposits in trust with the Trustee money in
an amount sufficient or U.S. Government Obligations, the principal of and
interest on which will be sufficient, or a combination thereof sufficient, to
pay the principal of, premium (if any) and interest, on the Securities when due
at maturity or redemption, as the case may be, including interest thereon to
maturity or such redemption date and Additional Interest (if any);

 

(ii) the Company delivers to the Trustee a certificate from a
nationally recognized firm of independent accountants expressing their opinion
that the payments of principal and interest when due and without reinvestment
on the deposited U.S. Government Obligations plus any deposited money
without investment will provide cash at such times and in such amounts as will
be sufficient to pay principal, premium, if any, interest and Additional
Interest, if any, when due on all the Securities to maturity or redemption, as
the case may be;

 

(iii) 123 days pass after the deposit is made and during the
123-day period no Default specified in Section 6.01(g) or (h) with
respect to the Company occurs which is continuing at the end of the period;

 

(iv) the deposit does not constitute a default under any other
agreement binding on the Company;

 

(v) the Company delivers to the Trustee an Opinion of Counsel to the
effect that the trust resulting from the deposit does not constitute, or is
qualified as, a regulated investment company under the Investment Company Act
of 1940;

 

75

 

(vi) in the case of the legal defeasance option, the Company shall have
delivered to the Trustee an Opinion of Counsel stating that (1) the
Company has received from, or there has been published by, the Internal Revenue
Service a ruling, or (2) 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, and based thereon such Opinion of Counsel shall confirm that, the Holders
will not recognize income, gain or loss for Federal income tax purposes as a
result of such deposit and legal defeasance and will 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 deposit and legal defeasance had not occurred;

 

(vii) in the case of the covenant defeasance option, the Company shall
have delivered to the Trustee an Opinion of Counsel to the effect that the
Holders will not recognize income, gain or loss for Federal income tax purposes
as a result of such deposit and covenant defeasance and will 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 deposit and covenant defeasance had
not occurred; and

 

(viii) the Company delivers to the Trustee an Officers’ Certificate and
an Opinion of Counsel, each stating that all conditions precedent to the
defeasance and discharge of the Securities as contemplated by this
Article 8 have been complied with.

 

(b) Before or after a deposit,
the Company may make arrangements satisfactory to the Trustee for the
redemption of Securities at a future date in accordance with Article 3.

 

(c) Notwithstanding the
foregoing, the Opinion of Counsel required by clause (vi) above need not
be delivered if all Securities not theretofore delivered to the Trustee for
cancelation have become due and payable.

 

SECTION 8.03. 
Application of Trust Money.  The Trustee shall hold in trust money or U.S. Government
Obligations deposited with it pursuant to this Article 8.  It shall apply the deposited money and the
money from U.S. Government Obligations through the Paying Agent and in
accordance with this Indenture to the payment of principal of and interest and
Additional Interest, if any, on the Securities.

 

SECTION 8.04. 
Repayment to Company. 
The Trustee and the Paying Agent shall promptly turn over to the Company
upon request any money or U.S. Government Obligations held by it as provided in
this Article which, in the written opinion of nationally recognized firm of
independent public accountants delivered to the Trustee (which delivery shall
only be required if U.S. Government Obligations have been so deposited), are in
excess of the amount thereof which would then be required to be deposited to
effect an equivalent discharge or defeasance in accordance with this Article.

 

Subject to any
applicable abandoned property law, the Trustee and the Paying Agent shall pay
to the Company upon written request any money held by them for

 

76

 

the payment of principal,
interest or Additional Interest (if any) that remains unclaimed for two years,
and, thereafter, Holders entitled to the money must look to the Company for
payment as general creditors, and the Trustee and the Paying Agent shall have
no further liability with respect to such monies.

 

SECTION 8.05. 
Indemnity for Government Obligations.  The Company shall pay and shall indemnify
the Trustee against any tax, fee or other charge imposed on or assessed against
deposited U.S. Government Obligations or the principal and interest
received on such U.S. Government Obligations.

 

SECTION 8.06. 
Reinstatement.  If
the Trustee or Paying Agent is unable to apply any money or U.S.
Government Obligations in accordance with this Article 8 by reason of any
legal proceeding or by reason of any order or judgment of any court or
governmental authority enjoining, restraining or otherwise prohibiting such
application, the Company’s obligations under this Indenture and the Securities
shall be revived and reinstated as though no deposit had occurred pursuant to
this Article 8 until such time as the Trustee or Paying Agent is permitted
to apply all such money or U.S. Government Obligations in accordance with
this Article 8; provided, however, that, if the Company has
made any payment of principal of or interest or Additional Interest, if any,
on, any Securities because of the reinstatement of its obligations, the Company
shall be subrogated to the rights of the Holders of such Securities to receive
such payment from the money or U.S. Government Obligations held by the Trustee
or Paying Agent.

 

ARTICLE IX

 

Amendments

 

SECTION 9.01. 
Without Consent of Holders.  (a) The Company, the Note Guarantors and the Trustee may amend
this Indenture, the Securities, the Security Documents or the Intercreditor
Agreement without notice to or consent of any Holder:

 

(i) to cure any ambiguity, omission, defect or inconsistency;

 

(ii) to comply with Article 5;

 

(iii) to provide for uncertificated Securities in addition to or in
place of certificated Securities; provided, however, that the
uncertificated Securities are issued in registered form for purposes of
Section 163(f) of the Code or in a manner such that the uncertificated
Securities are described in Section 163(f)(2)(B) of the Code;

 

(iv) to add additional Guarantees with respect to the Securities or to
secure further the Securities;

 

(v) to add to the covenants of the Company for the benefit of the
Holders or to surrender any right or power herein conferred upon the Company;

 

77

 

(vi) to comply with any requirement of the SEC in connection with
qualifying, or maintaining the qualification of, this Indenture under the TIA;

 

(vii) to make any change that does not materially and adversely affect
the rights of any Holder under the provisions of this Indenture;

 

(viii) to provide for the issuance of the Exchange Notes, Private
Exchange Notes, or the Additional Securities which shall have terms
substantially identical in all material respects to the Original Securities
(except that the transfer restrictions and Additional Interest provisions
contained in the Original Securities shall be modified or eliminated, as
appropriate), and which shall be treated, together with any outstanding
Original Securities, as a single issue of securities; and

 

(ix) if necessary, in connection with any addition or release of
Collateral permitted under the terms of this Indenture or the Security
Documents.

 

The Company
and the Note Guarantors shall also be entitled to other releases of the
Collateral or the Note Guarantees as described in Article 8 and Sections 10.03,
10.07 and 11.03 hereof.  If the Company
wishes under other circumstances to obtain an amendment or waiver or seek a
consent under any Security Document, any Note Guarantee or the Intercreditor
Agreement, the Company may mail written notice of its request to the Trustee
and the Holders, specifying the amendment, waiver or consent, the reason it is
being sought and any other information necessary for the Holders to reasonably
consider such matter.  If the Company
does not receive written objections from Holders of at least 25% in aggregate
principal amount at maturity of the Securities within 20 Business Days after
such mailing, such amendment, waiver or consent shall be deemed granted.  If the Company receives such objections,
then it shall not be entitled to effect such amendment or waiver, and such
consent shall not be effective, unless the Company obtains the consent of the
Holders of a majority in outstanding principal amount at maturity of the
Securities (including any Additional Securities) then outstanding voting as a
single class (including consents obtained in connection with a tender offer or
exchange offer for, or purchase of, the Securities).  In addition, without the consent of any Holder, the Trustee may
amend the terms of the Intercreditor Agreement in order to subject the security
interests in the Collateral in respect of any Other First Priority Obligations,
Credit Agreement Obligations, Second Priority Obligations and Secondary
Collateral Obligations to the terms of the Intercreditor Agreement, in each
case to the extent such Indebtedness was Incurred, and all Liens on the
Collateral held for the benefit of such Indebtedness were granted, pursuant to
this Indenture and the Intercreditor Agreement.

 

(b) After an amendment under
this Section 9.01 becomes effective, the Company shall mail to Holders a
notice briefly describing such amendment. 
The failure to give such notice to all Holders, or any defect therein,
shall not impair or affect the validity of an amendment under this
Section 9.01.

 

78

 

SECTION 9.02. 
With Consent of Holders. 
(a)  The Company, the Note
Guarantors and the Trustee may amend this Indenture, the Securities, the
Security Documents or the Intercreditor Agreement without notice to any Holder
but with the written consent of the Holders of at least a majority in principal
amount at maturity of the Securities then outstanding (including consents
obtained in connection with a tender offer or exchange for, or purchase of, the
Securities) and compliance with any provisions of this Indenture may be waived
with the written consent of the Holders of at least a majority in principal
amount at maturity of the Securities then outstanding (including consents
obtained in connection with a tender offer or exchange offer for, or purchase
of, the Securities).   However, without
the consent of each Holder affected, an amendment or waiver may not:

 

(i) reduce the amount of Securities whose Holders must consent to an
amendment;

 

(ii) reduce the rate of or extend the time for payment of interest
(including Additional Interest, if any) on any Security;

 

(iii) reduce the Accreted Value or principal of or extend the Stated
Maturity of any Security;

 

(iv) reduce the premium payable upon the redemption of any Security or
change the time at which any Security may be redeemed in accordance with
Article 3;

 

(v) make any Security payable in money other than that stated in the
Security;

 

(vi) impair the right of any Holder to receive payment of Accreted
Value or principal of, and interest (including Additional Interest, if any) on,
such Holder’s Securities on or after the due dates therefor or to institute
suit for the enforcement of any payment on or with respect to such Holder’s
Securities;

 

(vii) make any change in Section 6.04 or 6.07 or the second
sentence of this Section 9.02; or

 

(viii) modify the Note Guarantees in any manner adverse to the Holders.

 

(b) Notwithstanding the
foregoing, without the consent of Holders representing 662/3%
in principal amount at maturity of the Securities then outstanding, no
amendment or waiver may:

 

(i) release any Collateral from the Lien of this Indenture and the
Security Documents (except as permitted by the terms of the Security Documents
or the Intercreditor Agreement);

 

(ii) change the provisions applicable to the application of the
proceeds from the sale of Collateral; or

 

79

 

(iii) change or alter the priority of the security interests in the
Collateral.

 

It shall not
be necessary for the consent of the Holders under this Section 9.02 to
approve the particular form of any proposed amendment, but it shall be
sufficient if such consent approves the substance thereof.

 

After an
amendment under this Section 9.02 becomes effective, the Company shall
mail to Holders a notice briefly describing such amendment.  The failure to give such notice to all
Holders, or any defect therein, shall not impair or affect the validity of an
amendment under this Section 9.02.

 

SECTION 9.03. 
Compliance with Trust Indenture Act.  Every amendment to this Indenture or the
Securities shall comply with the TIA as then in effect.

 

SECTION 9.04. 
Revocation and Effect of Consents and Waivers.  (a)  A consent to an amendment or
a waiver by a Holder of a Security shall bind the Holder and every subsequent
Holder of that Security or portion of the Security that evidences the same debt
as the consenting Holder’s Security, even if notation of the consent or waiver
is not made on the Security.  However,
any such Holder or subsequent Holder may revoke the consent or waiver as to
such Holder’s Security or portion of the Security if the Trustee receives the
notice of revocation before the date on which the Trustee receives an Officers’
Certificate from the Company certifying that the requisite number of consents
have been received.  After an amendment
or waiver becomes effective, it shall bind every Holder.  An amendment or waiver becomes effective
upon the (i) receipt by the Company or the Trustee of the requisite number
of consents, (ii) satisfaction of conditions to effectiveness as set forth
in this Indenture and any indenture supplemental hereto containing such
amendment or waiver and (iii) execution of such amendment or waiver (or
supplemental indenture) by the Company and the Trustee.

 

(b) The Company may, but shall
not be obligated to, fix a record date for the purpose of determining the
Holders entitled to give their consent or take any other action described above
or required or permitted to be taken pursuant to this Indenture.  If a record date is fixed, then notwithstanding
the immediately preceding paragraph, those Persons who were Holders at such
record date (or their duly designated proxies), and only those Persons, shall
be entitled to give such consent or to revoke any consent previously given or
to take any such action, whether or not such Persons continue to be Holders
after such record date.  No such consent
shall be valid or effective for more than 120 days after such record date.

 

SECTION 9.05. 
Notation on or Exchange of Securities.  If an amendment changes the terms of a
Security, the Trustee may require the Holder of the Security to deliver it to
the Trustee.  The Trustee may place an
appropriate notation on the Security regarding the changed terms and return it
to the Holder.  Alternatively, if the
Company or the Trustee so determines, the Company in exchange for the Security
shall issue and the Trustee shall authenticate a new Security that reflects the
changed terms.  Failure to make the
appropriate notation or to issue a new Security shall not affect the validity
of such amendment.

 

80

 

SECTION 9.06. 
Trustee to Sign Amendments.  The Trustee shall sign any amendment authorized pursuant to this
Article 9 if the amendment does not adversely affect the rights, duties,
liabilities or immunities of the Trustee. 
If it does, the Trustee may but need not sign it.  In signing such amendment the Trustee shall
be entitled to receive indemnity reasonably satisfactory to it and to receive,
and (subject to Section 7.01) shall be fully protected in relying upon, an
Officers’ Certificate and an Opinion of Counsel stating that such amendment is
authorized or permitted by this Indenture and that such amendment is the legal,
valid and binding obligation of the Company and the Note Guarantors enforceable
against them in accordance with its terms, subject to customary exceptions, and
complies with the provisions hereof (including Section 9.03).

 

ARTICLE X

 

Collateral and
Security

 

SECTION 10.01. 
Security Documents. 
The due and punctual payment of the principal of and interest (including
Additional Interest, if any) on the Securities when and as the same shall be
due and payable, whether on an interest payment date, at maturity, by
acceleration, repurchase, redemption or otherwise, and interest on the overdue
principal of and interest (including Additional Interest, if any) on the
Securities and performance of all other obligations of the Company and the Note
Guarantors to the Holders or the Trustee under this Indenture and the Securities,
according to the terms hereunder or thereunder, are secured as provided in the
Security Documents, subject to the terms of the Intercreditor Agreement.  Each Holder, by its acceptance thereof,
consents and agrees to all of the terms of the Security Documents (including
the provisions providing for foreclosure and release of Collateral) and the
Intercreditor Agreement as the same may be in effect or may be amended from
time to time in accordance with their terms and authorizes and directs the Collateral
Agent to enter into the Security Documents and the Intercreditor Agreement and
to perform its obligations and exercise its rights thereunder in accordance
therewith.  The Company shall deliver to
the Trustee (if it is not then the Collateral Agent) copies of all documents
delivered to the Collateral Agent pursuant to the Security Documents, and will
do or cause to be done all such acts and things as may be required by the next
sentence of this Section 10.01, to assure and confirm to the Trustee and the
Collateral Agent the security interest in the Collateral contemplated hereby,
by the Security Documents or any part thereof, as from time to time
constituted, so as to render the same available for the security and benefit of
this Indenture and of the Securities secured hereby, according to the intent
and purposes herein expressed.  The
Company shall take, and shall cause its Restricted Subsidiaries to take, any
and all actions reasonably required to cause the Security Documents to create
and maintain, as security for the Obligations of the Company and the Note
Guarantors hereunder, a valid and enforceable perfected (a) first-priority
Lien and security interest in and on all First-Priority Collateral (consisting
of the 2004 Notes First Lien Collateral, as defined in the Intercreditor
Agreement, as in effect on the Closing Date) and (b) second-priority Lien
and security interest in and on all Second-Priority Collateral (consisting of
the Senior Lender First Lien Collateral, as defined in the Intercreditor Agreement,
as in 

 

81

 

effect on the Closing Date), in
each case, subject to the terms of the Intercreditor Agreement and in favor of
the Collateral Agent for the benefit of the Holders.

 

SECTION 10.02. 
Recording and Opinions. 
(a)  The Company will deliver to
the Collateral Agent and the Trustee on May 15 in each year beginning with May
15 , 2004, an Opinion of Counsel, which may be rendered by internal counsel to
the Company, dated as of such date, either:

 

(i) stating substantially to the effect that, in the opinion of such
counsel, action has been taken with respect to the recording, filing,
re-recording, and re-filing of this Indenture or any Security Document as is
necessary to maintain the Lien of this Indenture or any Security Documents and
reciting with respect to the security interests in the Collateral the details
of such action or referring to prior Opinions of Counsel in which such details
are given; or

 

(ii) stating that, in the opinion of such counsel, no such action is
necessary to maintain and perfect such Lien under this Indenture and the
Security Documents.

 

(b) The Company will otherwise
comply with the provisions of TIA § 314(b).

 

SECTION 10.03. 
Release of Collateral. 
(a)  Subject to subsections (b),
(c) and (d) of this Section 10.03, Collateral may be released from the Lien and
security interest created by the Security Documents at any time or from time to
time in accordance with the provisions of the Security Documents and as
provided hereby.

 

(i) Upon the request of the Company pursuant to an Officers’
Certificate certifying that all conditions precedent hereunder have been met
and without the consent of any Holder, the Company and the Note Guarantors will
be entitled to releases of assets included in the First-Priority Collateral
from the Liens securing the Securities under any one or more of the following
circumstances:

 

(A) to enable the Company or any Note Guarantor to consummate any Asset
Disposition permitted or not prohibited by Section 4.06 hereof;

 

(B) if any Subsidiary that is a Note Guarantor is released from its
Note Guarantee, such Subsidiary’s assets will also be released; or

 

(C) pursuant to an amendment, waiver or supplement in accordance with
Article 9 hereof.

 

Upon receipt of
such Officers’ Certificate and any necessary or proper instruments of
termination, satisfaction or release prepared by the Company, the Collateral
Agent shall execute, deliver or acknowledge such instruments or releases to
evidence the release of any Collateral permitted to be released pursuant to
this Indenture or the Security Documents.

 

82

 

(ii) Whether prior to or after the Discharge of Credit Agreement
Obligations, upon the request of the Company pursuant to an Officers’
Certificate certifying that all conditions precedent hereunder have been met
and without the consent of any Holder, the Company and the Note Guarantors will
be entitled to releases of assets included in the Second-Priority Collateral from
the Liens securing the Securities under any one or more of the following
circumstances:

 

(A) if all other Liens (other than Permitted Liens described in clauses
(b) through (aa) of the definition thereof) on any such asset that secure
Credit Agreement Obligations or any Secondary Collateral Obligations then
secured by that asset (including all commitments thereunder) are released; provided,
that after giving effect to the release, obligations secured by the
first-priority Liens on the remaining Second-Priority Collateral remain
outstanding;

 

(B) to enable the Company or any Note Guarantor to consummate any Asset
Disposition permitted or not prohibited by Section 4.06 hereof;

 

(C) if all of the stock of any Subsidiary of the Company that is
pledged to the Collateral Agent is released or if any Subsidiary that is a Note
Guarantor is released from its Note Guarantee, such Subsidiary’s assets will
also be released; or

 

(D) pursuant to an amendment, waiver or supplement in accordance with
Article 9 hereof.

 

Upon receipt
of such Officers’ Certificate and any necessary or proper instruments of
termination, satisfaction or release prepared by the Company, the Collateral
Agent shall execute, deliver or acknowledge such instruments or releases to
evidence the release of any Collateral permitted to be released pursuant to
this Indenture or the Security Documents.

 

(b) Except as otherwise
provided in the Intercreditor Agreement and except as set forth in the
preceding paragraph, no Collateral may be released from the Lien and security
interest created by the Security Documents pursuant to the provisions of the
Security Documents unless the Officers’ Certificate required by this Section
10.03 has been delivered to the Collateral Agent.

 

(c) At any time when a Default
or Event of Default has occurred and is continuing and the maturity of the
Securities has been accelerated (whether by declaration or otherwise) and the
Trustee has delivered a notice of acceleration to the Collateral Agent, no
release of Collateral pursuant to the provisions of the Security Documents will
be effective as against the Holders, except as otherwise provided in the
Intercreditor Agreement.

 

(d) The release of any
Collateral from the terms of this Indenture and the Security Documents shall
not be deemed to impair the security under this Indenture in contravention of
the provisions hereof if and to the extent the Collateral is released pursuant
to the terms of (i) the Intercreditor Agreement or (ii) this Indenture and the

 

83

 

Security Documents.  To the extent applicable, the Company will
cause TIA § 313(b), relating to reports, and TIA § 314(d), relating to the
release of property or securities from the Lien and security interest of this
Indenture and the Security Documents and relating to the substitution therefor
of any property or securities to be subjected to the Lien and security interest
of this Indenture and the Security Documents, to be complied with.  Any certificate or opinion required by TIA §
314(d) may be made by an Officer of the Company except in cases where TIA §
314(d) requires that such certificate or opinion be made by an independent
Person, which Person will be an independent engineer, appraiser or other expert
selected or approved by the Trustee and the Collateral Agent in the exercise of
reasonable care.

 

SECTION 10.04. 
Certificates of the Trustee.  In the event that the Company wishes to release Collateral in
accordance with the Security Documents at a time when the Trustee is not itself
also the Collateral Agent and the Company has delivered the certificates and
documents required by the Security Documents and Section 10.03 hereof, the
Trustee will determine whether it has received all documentation required by
TIA § 314(d) in connection with such release and, based on such determination,
will deliver a certificate to the Collateral Agent setting forth such
determination.

 

SECTION 10.05. 
Authorization of Actions to Be Taken by the Trustee Under the
Security Documents.  Subject to the
provisions of Section 7.01 and 7.02 
hereof and the Intercreditor Agreement, the Trustee may, in its sole
discretion and without the consent of the Holders, direct, on behalf of the
Holders, the Collateral Agent to, take all actions it deems necessary or
appropriate in order to:

 

(a) enforce any of the terms of
the Security Documents; and

 

(b) collect and receive any and
all amounts payable in respect of the Obligations of the Company hereunder.

 

Subject to
Section 3 of the Intercreditor Agreement, the Trustee will have power to
institute and maintain such suits and proceedings as it may deem expedient to
prevent any impairment of the Collateral by any acts that may be unlawful or in
violation of the Security Documents or this Indenture, and such suits and
proceedings as the Trustee may deem expedient to preserve or protect its
interests and the interests of the Holders in the Collateral (including power
to institute and maintain suits or proceedings to restrain the enforcement of
or compliance with any legislative or other governmental enactment, rule or
order that may be unconstitutional or otherwise invalid if the enforcement of,
or compliance with, such enactment, rule or order would impair the security
interest hereunder or be prejudicial to the interests of the Holders or of the
Trustee).

 

SECTION 10.06. 
Authorization of Receipt of Funds by the Trustee Under the
Security Documents.  Subject to the
provisions of the Intercreditor Agreement, the Trustee is authorized to receive
any funds for the benefit of the Holders distributed under

 

84

 

the Security Documents, and to
make further distributions of such funds to the Holders according to the
provisions of this Indenture.

 

SECTION 10.07. 
Termination of Security Interest.  The Trustee will, at the request of the
Company, deliver a certificate to the Collateral Agent stating that such
Obligations have been paid in full, and instruct the Collateral Agent to
release the Liens pursuant to this Indenture and the Security Documents upon
(1) payment in full of the Accreted Value or principal of, accrued and unpaid
interest (including Additional Interest, if any) on the Securities and all
other Obligations under this Indenture, the Note Guarantees and the Security Documents
that are due and payable at or prior to the time such Accreted Value or
principal, accrued and unpaid interest and Additional Interest, if any, are
paid, (2) a satisfaction and discharge of this Indenture as described in
Article 8 or (3) a legal defeasance or covenant defeasance as described in
Article 8.  Upon receipt of such
instruction and any necessary or proper instruments of termination,
satisfaction or release prepared by the Company, the Collateral Agent shall
execute, deliver or acknowledge any such instruments or releases to evidence
the release of all such Liens.

 

SECTION 10.08. 
Collateral Agent. 
(a)  The Trustee shall initially
act as Collateral Agent and shall be authorized to appoint co-Collateral Agents
as necessary in its sole discretion. Except as otherwise explicitly provided
herein or in the Security Documents, neither the Collateral Agent nor any of
its respective officers, directors, employees or agents shall be liable for
failure to demand, collect or realize upon any of the Collateral or for any
delay in doing so or shall be under any obligation to sell or otherwise dispose
of any Collateral upon the request of any other Person or to take any other
action whatsoever with regard to the Collateral or any part thereof.  The Collateral Agent shall be accountable
only for amounts that it actually receives as a result of the exercise of such
powers, and neither the Collateral Agent nor any of its officers, directors,
employees or agents shall be responsible for any act or failure to act
hereunder, except for its own willful misconduct, gross negligence or bad
faith.

 

(b) The Trustee, as Collateral
Agent, is authorized and directed to (i) enter into the Security Documents,
(ii) enter into the Intercreditor Agreement, (iii) bind the Holders on the
terms as set forth in the Security Documents and the Intercreditor Agreement
and (iv) perform and observe its obligations under the Security Documents and
the Intercreditor Agreement.

 

(c) If the Company (i) incurs
Indebtedness constituting Credit Agreement Obligations at any time when no
Intercreditor Agreement is in effect or at any time when Indebtedness
constituting Credit Agreement Obligations entitled to the benefit of an
existing Intercreditor Agreement is concurrently retired, and (ii) delivers to
the Collateral Agent an Officers’ Certificate so stating and requesting the
Collateral Agent to enter into an Intercreditor Agreement in favor of a
designated agent or representative for the holders of the Indebtedness so
incurred, the Collateral Agent shall (and is hereby authorized and directed to)
enter into such Intercreditor Agreement, bind the Holders on the terms set
forth therein, and perform and observe its obligations thereunder.

 

85

 

(d) If (i) the Company at any
time after the Closing Date incurs any Indebtedness constituting Secondary
Collateral Obligations, (ii) the indenture or agreement governing such
Indebtedness provides that, notwithstanding the date, manner or order of grant,
attachment or perfection of any second-priority Liens granted to the Collateral
Agent under the Security Documents (the “Second-Priority Liens Securing Note
Obligations”) or granted to the holders of Secondary Collateral Obligations or
any agent or representative for the holders of Secondary Collateral Obligations
(the “Liens Securing Secondary Collateral Obligations”), the Second-Priority
Liens Securing Note Obligations and the Liens Securing Secondary Collateral
Obligations shall be of equal, dignity, priority and rank, (iii) the Company
delivers to the Collateral Agent an Officers’ Certificate so stating and
requesting that the Collateral Agent assign or transfer the Second-Priority
Liens Securing Note Obligations to a Common Collateral Agent identified therein
and (iv) the Company delivers to the Collateral Agent and the Common Collateral
Agent an Opinion of Counsel further confirming as to all such Liens each of the
matters referred to in Section 10.02(a)(i), giving effect to the assignment or
transfer requested in such Officers’ Certificate, then (A) the Second-Priority
Liens Securing Note Obligations shall be of equal dignity, priority and rank
with all such Liens Securing Secondary Collateral Obligations and (B) the
Collateral Agent shall, upon receipt of the necessary or proper documentation
prepared by the Company, assign or transfer the Second-Priority Liens Securing
Note Obligations to the Common Collateral Agent as requested in such Officers’
Certificate.

 

SECTION 10.09. 
Designations. 
Except as provided in the next sentence, for purposes of the provisions
hereof and the Intercreditor Agreement requiring the Company to designate
Indebtedness for the purposes of the term “Credit Agreement Obligations”,
“First-Lien Credit Facilities”, “Other First-Priority Obligations”, “Secondary
Collateral Obligations” or any other such designations hereunder or under the
Intercreditor Agreement, any such designation shall be sufficient if the
relevant designation is set forth in writing, signed on behalf of the Company
by an Officer and delivered to the Trustee, the Collateral Agent, the Credit
Agent and the May 2003 Notes Agent.  For
all purposes hereof and the Intercreditor Agreement, the Company hereby
designates the Credit Facilities provided pursuant to the Credit Agreement as a
“First-Lien Credit Facility”.

 

ARTICLE XI

 

Note
Guarantees

 

SECTION 11.01. 
 Note Guarantees.  (a) 
Each Note Guarantor hereby jointly and severally and unconditionally
guarantees, as a primary obligor and not merely as a surety, to each Holder and
to the Trustee and its successors and assigns (i) the full and punctual
payment when due, whether at Stated Maturity, by acceleration, by redemption or
otherwise, of all obligations of the Company under this Indenture (including
obligations to the Trustee) and the Securities, whether for payment of
principal of, interest on or Additional Interest, if any, in respect of the
Securities and all other monetary obligations (to the fullest extent permitted
by applicable law) of the Company

 

86

 

under this Indenture and the
Securities and (ii) the full and punctual performance within applicable
grace periods of all other obligations of the Company whether for fees,
expenses, indemnification or otherwise under this Indenture and the Securities
(all the foregoing being hereinafter collectively called the “Guaranteed
Obligations”).  To the fullest extent
permitted by applicable law, each Note Guarantor further agrees that the
Guaranteed Obligations may be extended or renewed, in whole or in part, without
notice or further assent from each such Note Guarantor, and that each such Note
Guarantor shall remain bound under this Article 11 notwithstanding any
extension or renewal of any Guaranteed Obligation.

 

(b) Each Note Guarantor waives
presentation to, demand of payment from and protest to the Company of any of
the Guaranteed Obligations and also waives notice of protest for
nonpayment.  Each Note Guarantor waives
notice of any default under the Securities or the Guaranteed Obligations.  The obligations of each Note Guarantor
hereunder shall not be affected by (i) the failure of any Holder or the
Trustee to assert any claim or demand or to enforce any right or remedy against
the Company or any other Person under this Indenture, the Securities or any
other agreement or otherwise; (ii) any extension or renewal of any thereof;
(iii) any rescission, waiver, amendment or modification of any of the
terms or provisions of this Indenture, the Securities or any other agreement;
(iv) the release of any security held by any Holder or the Trustee for the
Guaranteed Obligations or any of them; (v) the failure of any Holder or
Trustee to exercise any right or remedy against any other guarantor of the
Guaranteed Obligations; or (vi) any change in the ownership of such Note
Guarantor, except as provided in Section 11.02(b).

 

(c) Each Note Guarantor hereby
waives any right to which it may be entitled to have its obligations hereunder
divided among the Note Guarantors, such that such Note Guarantor’s obligations
would be less than the full amount claimed. 
Each Note Guarantor hereby waives any right to which it may be entitled
to have the assets of the Company first be used and depleted as payment of the
Company’s or such Note Guarantor’s obligations hereunder prior to any amounts
being claimed from or paid by such Note Guarantor hereunder.  Each Note Guarantor hereby waives any right
to which it may be entitled to require that the Company be sued prior to an
action being initiated against such Note Guarantor.

 

(d) Each Note Guarantor further
agrees that its Note Guarantee herein constitutes a guarantee of payment,
performance and compliance when due (and not a guarantee of collection) and
waives any right to require that any resort be had by any Holder or the Trustee
to any security held for payment of the Guaranteed Obligations.

 

(e) Except as expressly set
forth in Sections 8.01(b), 11.02 and 11.07, the obligations of each
Note Guarantor hereunder shall not be subject to any reduction, limitation,
impairment or termination for any reason, including any claim of waiver,
release, surrender, alteration or compromise, and shall not be subject to any
defense of setoff, counterclaim, recoupment or termination whatsoever or by
reason of the invalidity, illegality or unenforceability of the Guaranteed
Obligations or otherwise.  Without
limiting the generality of the foregoing, the obligations of each Note
Guarantor

 

87

 

herein shall not be discharged
or impaired or otherwise affected by the failure of any Holder or the Trustee
to assert any claim or demand or to enforce any remedy under this Indenture,
the Securities or any other agreement, by any waiver or modification of any
thereof, by any default, failure or delay, wilful or otherwise, in the
performance of the obligations, or by any other act or thing or omission or
delay to do any other act or thing which may or might in any manner or to any
extent vary the risk of any Note Guarantor or would otherwise operate as a
discharge of any Note Guarantor as a matter of law or equity.

 

(f) Each Note Guarantor agrees
that its Note Guarantee shall remain in full force and effect until payment in
full of all the Guaranteed Obligations or such Note Guarantee is released in
compliance with Section 11.03 or upon the merger or the sale of all the Capital
Stock or assets of the Note Guarantor in compliance with Section 4.06 or
Article 5.  Each Note Guarantor further
agrees that its Note Guarantee herein shall, to the fullest extent permitted by
applicable law,  continue to be
effective or be reinstated, as the case may be, if at any time payment, or any
part thereof, of principal of or interest or Additional Interest, if any, on
any Guaranteed Obligation is rescinded or must otherwise be restored by any
Holder or the Trustee upon the bankruptcy or reorganization of the Company or
otherwise.

 

(g) In furtherance of the
foregoing and not in limitation of any other right which any Holder or the
Trustee has at law or in equity against any Note Guarantor by virtue hereof,
upon the failure of the Company to pay the principal of or interest or
Additional Interest, if any, on any Guaranteed Obligation when and as the same
shall become due, whether at maturity, by acceleration, by redemption or
otherwise, or to perform or comply with any other Guaranteed Obligation, each
Note Guarantor hereby promises to and shall, upon receipt of written demand by
the Trustee, forthwith pay, or cause to be paid, in cash, to the Holders or the
Trustee an amount equal to the sum of (i) the unpaid principal amount of
such Guaranteed Obligations, (ii) accrued and unpaid interest on such
Guaranteed Obligations (but only to the extent not prohibited by law) and
(iii) all other monetary obligations of the Company to the Holders and the
Trustee.

 

(h) Each Note Guarantor agrees
that it shall not be entitled to any right of subrogation in relation to the
Holders in respect of any Guaranteed Obligations guaranteed hereby until
payment in full of all Guaranteed Obligations. 
Each Note Guarantor further agrees that, as between it, on the one hand,
and the Holders and the Trustee, on the other hand, to the fullest extent
permitted by applicable law, (i) the maturity of the Guaranteed
Obligations guaranteed hereby may be accelerated as provided in Article 6
for the purposes of any Note Guarantee herein, notwithstanding any stay,
injunction or other prohibition preventing such acceleration in respect of the
Guaranteed Obligations guaranteed hereby, and (ii) in the event of any
declaration of acceleration of such Guaranteed Obligations as provided in
Article 6, such Guaranteed Obligations (whether or not due and payable)
shall forthwith become due and payable by such Note Guarantor for the purposes
of this Section 11.01.

 

88

 

(i) Each Note Guarantor also
agrees to pay any and all costs and expenses (including reasonable attorneys’
fees and expenses) incurred by the Trustee or any Holder in enforcing any
rights under this Section 11.01.

 

(j) Upon request of the
Trustee, each Note Guarantor shall execute and deliver such further instruments
and do such further acts as may be reasonably necessary or proper to carry out
more effectively the purpose of this Indenture.

 

SECTION 11.02. 
Limitation on Liability.  
Any term or provision of this Indenture to the contrary notwithstanding,
the maximum aggregate amount of the Guaranteed Obligations guaranteed hereunder
by any Note Guarantor shall not exceed the maximum amount that can be hereby
guaranteed without rendering this Indenture, as it relates to such Note
Guarantor, void or voidable under applicable law relating to fraudulent
conveyance or fraudulent transfer or similar laws affecting the rights of
creditors generally.

 

SECTION 11.03. 
Releases of Note Guarantees.  A Note Guarantee shall be released without any action required on
the part of the Trustee or any Holder: (a) if the Note Guarantor is a Foreign
Subsidiary and it does not guarantee any Indebtedness of the Company or any
domestic Subsidiary; (b) if (i) all of the Capital Stock of, or all or
substantially all of the assets of such Note Guarantor is sold or otherwise
disposed of (including by way of merger or consolidation) to a Person other
than the Company or another Note Guarantor (provided that such Note
Guarantor does not continue to guarantee any Indebtedness of the Company or any
domestic Subsidiary) or (ii) such Note Guarantor ceases to be a Restricted
Subsidiary, and the Company otherwise complies, to the extent applicable, with
Section 4.06 and Section 5.01 hereof; or (c) if the Company
designates such Note Guarantor as an Unrestricted Subsidiary (unless any of the
First-Priority Collateral is then owned by such Note Guarantor).  A Note Guarantor may also be released from
its obligations under its Note Guarantee in connection with an amendment
permitted by Article 9.

 

Upon delivery
by the Company to the Trustee of an Officers’ Certificate and an Opinion of
Counsel to the effect that such release was made by the Company in accordance
with the provisions of this Indenture, the Trustee will execute any documents
prepared by the Company reasonably required in order to evidence the release of
any Note Guarantor from its obligations under its Note Guarantee.

 

Any Note
Guarantor not released from its obligations under its Note Guarantee will
remain liable for the full amount of principal of and interest on the
Securities and for the other obligations of any Note Guarantor under this
Indenture as provided in this Article 11.

 

SECTION 11.04. 
Successors and Assigns. 
This Article 11 shall be binding upon each Note Guarantor and its
successors and assigns 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
conferred upon that party in this Indenture and in the Securities shall

 

89

 

automatically extend to and be
vested in such transferee or assignee, all subject to the terms and conditions
of this Indenture.

 

SECTION 11.05. 
No Waiver.  Neither
a failure nor a delay on the part of either the Trustee or the Holders in
exercising any right, power or privilege under this Article 11 shall
operate as a waiver thereof, nor shall a single or partial exercise thereof
preclude any other or further exercise of any right, power or privilege.  The rights, remedies and benefits of the
Trustee and the Holders herein expressly specified are cumulative and not
exclusive of any other rights, remedies or benefits which either may have under
this Article 11 at law, in equity, by statute or otherwise.

 

SECTION 11.06. 
Modification.  No
modification, amendment or waiver of any provision of this Article 11, nor
the consent to any departure by any Note Guarantor therefrom, shall in any
event be effective unless the same shall be in writing and signed by the
Trustee, and then such waiver or consent shall be effective only in the
specific instance and for the purpose for which given.  No notice to or demand on any Note Guarantor
in any case shall entitle such Note Guarantor to any other or further notice or
demand in the same, similar or other circumstances.

 

SECTION 11.07. 
Execution of Supplemental Indenture for Future Note
Guarantors.  Each Subsidiary which
is required to become a Note Guarantor pursuant to Section 4.11 shall
promptly execute and deliver to the Trustee a supplemental indenture in the
form of Exhibit C hereto pursuant to which such Subsidiary shall become a
Note Guarantor under this Article 11 and shall guarantee the Guaranteed
Obligations.  Concurrently with the
execution and delivery of such supplemental indenture, the Company shall
deliver to the Trustee an Opinion of Counsel and an Officers’ Certificate to
the effect that such supplemental indenture has been duly authorized, executed
and delivered by such Subsidiary and that, subject to the application of
bankruptcy, insolvency, moratorium, fraudulent conveyance or transfer and other
similar laws relating to creditors’ rights generally and to the principles of
equity, whether considered in a proceeding at law or in equity, the Note
Guarantee of such Note Guarantor is a valid and binding obligation of such Note
Guarantor, enforceable against such Note Guarantor in accordance with its terms
and or to such other matters as the Trustee may reasonably request.

 

SECTION 11.08. 
Non-Impairment. 
The failure to endorse a Note Guarantee on any Security shall not affect
or impair the validity thereof.

 

ARTICLE XII

 

Miscellaneous

 

SECTION 12.01. 
Trust Indenture Act Controls.  If and to the extent that any provision of this Indenture limits,
qualifies or conflicts with the duties imposed by, or with another provision
(an “incorporated provision”) included in this Indenture by operation of,
TIA §§ 310 to 318, inclusive, such imposed duties or incorporated
provision shall control.

 

90

 

SECTION 12.02. 
Notices.  Any
notice or communication shall be in writing (which may be a facsimile with the
original to follow) and delivered in person or mailed by first-class mail
addressed as follows:

 

if to the
Company:

 

Pliant
Corporation

1515 Woodfield Road, Suite 600

Schaumburg, Illinois 60173

 

Attention of:

Brian E. Johnson

 

if to the
Trustee:

 

Wilmington
Trust Company

Rodney Square North

1100 North Market Street

Wilmington, DE 19890-0001

 

Attention of:

Corporate Trust Administration

 

The Company or
the Trustee by notice to the other may designate additional or different
addresses for subsequent notices or communications.

 

Any notice or
communication mailed to a Holder shall be mailed, first class mail, to the
Holder at the Holder’s address as it appears on the registration books of the
Registrar and shall be sufficiently given if so mailed within the time
prescribed.

 

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, it
is duly given, whether or not the addressee receives it.

 

SECTION 12.03. 
Communication by Holders with Other Holders.  Holders may communicate pursuant to
TIA § 312(b) with other Holders with respect to their rights under
this Indenture or the Securities.  The
Company, the Trustee, the Registrar and anyone else shall have the protection
of TIA § 312(c).

 

SECTION 12.04. 
Certificate and Opinion as to Conditions Precedent.  Upon any request or application by the
Company to the Trustee to take or refrain from taking any action under this
Indenture, the Company shall furnish to the Trustee:

 

(a)  an Officers’ Certificate in form reasonably
satisfactory to the Trustee stating that, in the opinion of the signers, all
conditions precedent, if any, provided for in this Indenture relating to the
proposed action have been complied with; and

 

91

 

(b)  an Opinion of Counsel in form reasonably
satisfactory to the Trustee stating that, in the opinion of such counsel, all
such conditions precedent have been complied with (provided, however,
that such counsel may rely as to matters of fact on Officers’ Certificates).

 

SECTION 12.05. 
Statements Required in Certificate or Opinion.  Each certificate or opinion with respect to
compliance with a covenant or condition provided for in this Indenture (other
than pursuant to Section 4.09) shall include:

 

(a)  a statement that the individual 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
individual, he 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 complied with; and

 

(d)  a statement as to whether or not, in the
opinion of such individual, such covenant or condition has been complied with.

 

SECTION 12.06. 
When Securities Disregarded.  In determining whether the Holders of the required principal
amount at maturity of Securities have concurred in any direction, waiver or
consent, Securities owned by the Company, any Note Guarantor or by any Person
directly or indirectly controlling or controlled by or under direct or indirect
common control with the Company or any Note Guarantor (other than JP Morgan
Securities, Inc.) shall be disregarded and deemed not to be outstanding, except
that, for the purpose of determining whether the Trustee shall be protected in
relying on any such direction, waiver or consent, only Securities which the
Trustee knows are so owned shall be so disregarded.  Subject to the foregoing, only Securities outstanding at the time
shall be considered in any such determination.

 

SECTION 12.07. 
Rules by Trustee, Paying Agent and Registrar.  The Trustee may make reasonable rules for
action by or a meeting of Holders.  The
Registrar and the Paying Agent may make reasonable rules for their functions.

 

SECTION 12.08. 
Legal Holidays.  A
“Legal Holiday” is a Saturday, a Sunday or other day on which banking
institutions are not required by law or regulation to be open in the State of
New York.  If a payment date is a Legal
Holiday, payment shall be made on the next succeeding day that is not a Legal
Holiday, and no interest shall accrue for the intervening period.  If a regular record date is a Legal Holiday,
the record date shall not be affected.

 

SECTION 12.09. 
GOVERNING LAW. 
THIS INDENTURE AND THE SECURITIES SHALL BE GOVERNED BY, AND CONSTRUED IN
ACCORDANCE

 

92

 

WITH, THE LAWS OF THE STATE OF
NEW YORK BUT WITHOUT GIVING EFFECT TO APPLICABLE PRINCIPLES OF CONFLICTS
OF LAW TO THE EXTENT THAT THE APPLICATION OF THE LAWS OF ANOTHER JURISDICTION
WOULD BE REQUIRED THEREBY.

 

SECTION 12.10. 
No Recourse Against Others.  A director, officer, employee or stockholder, as such, of the
Company or any of the Note Guarantors, shall not have any liability for any
obligations of the Company or any of the Note Guarantors under the Securities
or this Indenture or for any claim based on, in respect of or by reason of such
obligations or their creation.  By
accepting a Security, each Holder shall waive and release all such
liability.  The waiver and release shall
be part of the consideration for the issue of the Securities.

 

SECTION 12.11. 
Successors.  All
agreements of the Company and each Note Guarantor in this Indenture and the
Securities shall bind its successors. 
All agreements of the Trustee in this Indenture shall bind its
successors.

 

SECTION 12.12. 
Multiple 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.  One signed copy is enough to prove this Indenture.

 

SECTION 12.13. 
Table of Contents; Headings.  The table of contents, cross-reference sheet and headings of the
Articles and Sections of this Indenture have been inserted for convenience of
reference only, are not intended to be considered a part hereof and shall not
modify or restrict any of the terms or provisions hereof.

 

93

 

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

 

	
   

  	
  PLIANT
  CORPORATION,

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By

  	
   

  	
   

  
	
   

  	
   

  	
  Name:

  	
  Brian E.
  Johnson

  
	
   

  	
   

  	
  Title:

  	
  Executive
  Vice President,

  
	
   

  	
   

  	
   

  	
  Chief
  Financial Officer and

  Secretary

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  PLIANT
  CORPORATION INTERNATIONAL,

  
	
   

  	
  PLIANT FILM
  PRODUCTS OF MEXICO, INC.,

  
	
   

  	
  PLIANT
  SOLUTIONS CORPORATION,

  
	
   

  	
  PLIANT
  PACKAGING OF CANADA, LLC,

  
	
   

  	
  UNIPLAST
  HOLDINGS INC.,

  
	
   

  	
  UNIPLAST
  U.S., INC.,

  
	
   

  	
  TUREX, INC.,

  
	
   

  	
  PIERSON
  INDUSTRIES, INC.,

  
	
   

  	
  UNIPLAST
  MIDWEST, INC.,

  
	
   

  	
  UNIPLAST
  INDUSTRIES CO.,

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By

  	
   

  	
   

  
	
   

  	
   

  	
  Name:

  	
  Brian E.
  Johnson

  
	
   

  	
   

  	
  Title:

  	
  Vice
  President

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  WILMINGTON
  TRUST COMPANY, as Trustee

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  By

  	
   

  	
   

  
	
   

  	
   

  	
  Name:

  	
  James
  McGinley

  
	
   

  	
   

  	
  Title:

  	
  Vice
  President

  
							

 

94

APPENDIX A

 

PROVISIONS RELATING TO ORIGINAL SECURITIES,

ADDITIONAL SECURITIES, PRIVATE EXCHANGE NOTES

AND EXCHANGE NOTES

 

1. Definitions

 

1.1  Definitions

 

For the
purposes of this Appendix A the following terms shall have the meanings
indicated below:

 

“Applicable
Procedures” means, with respect to any transfer or transaction involving a
Regulation S Global Security or beneficial interest therein, the rules and
procedures of the Depositary for such Global Security to the extent applicable
to such transaction and as in effect from time to time.

 

“Definitive
Security” means a certificated Initial Security, Private Exchange Note or
Exchange Note (bearing the Restricted Securities Legend if the transfer of such
Security is restricted by applicable law) that does not include the Global
Securities Legend.

 

“Depositary”
means The Depository Trust Company, its nominees and their respective
successors.

 

“Global
Securities Legend” means the legend set forth under that caption in
Exhibit A to this Indenture.

 

“IAI” means an
institutional “accredited investor” as described in Rule 501(a)(1), (2),
(3) or (7) under the Securities Act.

 

“Initial
Purchasers” means J.P. Morgan Securities Inc., Credit Suisse First Boston LLC
and Deutsche Bank Securities Inc.

 

“Issue Date”
means, with respect to any Initial Securities, the date on which such Initial
Securities are originally issued.

 

“Private
Exchange” means an offer by the Company, pursuant to the Registration
Agreement, to issue and deliver to certain purchasers, in exchange for the
Initial Securities held by such purchasers as part of their initial
distribution, a like aggregate principal amount at maturity of Private Exchange
Notes.

 

“Private
Exchange Notes” means the Securities of the Company issued in exchange for
Initial Securities pursuant to this Indenture in connection with the Private
Exchange pursuant to the Registration Agreement.

 

“Purchase
Agreement” means (a) the Purchase Agreement dated February 6, 2004, among
the Company, the Note Guarantors and the Initial Purchasers and (b) any other
similar Purchase Agreement relating to Additional Securities.

 

 

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

 

“Registered
Exchange Offer” means an offer by the Company, pursuant to the Registration
Agreement, to certain Holders of Initial Securities, to issue and deliver to
such Holders, in exchange for their Initial Securities, a like aggregate
principal amount at maturity of Exchange Notes registered under the Securities
Act.

 

“Registration
Agreement” means (a) the Exchange and Registration Rights Agreement dated
February 17, 2004, among the Company, the Note Guarantors and the Initial
Purchasers and (b) any other similar Exchange and Registration Rights Agreement
relating to Additional Securities.

 

“Regulation S”
means Regulation S under the Securities Act.

 

“Regulation S
Securities” means all Initial Securities offered and sold outside the United
States in reliance on Regulation S.

 

“Restricted
Period”, with respect to any Securities, means the period of
40 consecutive days beginning on and including the later of (a) the
day on which such Securities are first offered to persons other than
distributors (as defined in Regulation S under the Securities Act) in
reliance on Regulation S, notice of which day shall be promptly given by the
Company to the Trustee, and (b) the Issue Date with respect to such
Securities.

 

“Restricted
Securities Legend” means the legend set forth in Section 2.3(e)(i) herein.

 

“Rule 501”
means Rule 501(a)(1), (2), (3) or (7) under the Securities Act.

 

“Rule 144A” means Rule 144A under the
Securities Act.

 

“Rule 144A
Securities” means all Initial Securities offered and sold to QIBs in reliance
on Rule 144A.

 

“Securities
Act” means the Securities Act of 1933, as amended.

 

“Securities Custodian”
means the custodian with respect to a Global Security (as appointed by the
Depositary) or any successor person thereto, who shall initially be the
Trustee.

 

“Shelf
Registration Statement” means a registration statement filed by the Company in
connection with the offer and sale of Initial Securities pursuant to the
Registration Agreement.

 

“Transfer
Restricted Securities” means Definitive Securities and any other Securities
that bear or are required to bear the Restricted Securities Legend.

 

2

 

1.2  Other
Definitions

 

	
  Term:

  	
   

  	
  Defined

  in Section:

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  “Agent Members”

  	
   

  	
  2.1(c)

  	
   

  
	
  “IAI Global Security”

  	
   

  	
  2.1(b)

  	
   

  
	
  “Global Security”

  	
   

  	
  2.1(b)

  	
   

  
	
  “Regulation S Global Security”

  	
   

  	
  2.1(b)

  	
   

  
	
  “Rule 144A Global Security”

  	
   

  	
  2.1(b)

  	
   

  

 

2.    The Securities

 

2.1  Form and Dating

 

(a)  The Original Securities issued on the date
hereof will be (i) offered and sold by the Company pursuant to the
Purchase Agreement and (ii) resold, initially only to (1) QIBs in reliance on
Rule 144A and (2) Persons other than U.S. Persons (as defined in
Regulation S) in reliance on Regulation S. 
Such Original Securities may thereafter be transferred to, among others,
QIBs, purchasers in reliance on Regulation S and, except as set forth
below, IAIs in accordance with Rule 501. 
Additional Securities offered after the date hereof may be offered and
sold by the Company from time to time pursuant to one or more Purchase
Agreements in accordance with applicable law.

 

(b)  Global Securities.  Rule 144A Securities shall be issued
initially in the form of one or more permanent global Securities in definitive,
fully registered form (collectively, the “Rule 144A Global Security”) and
Regulation S Securities shall be issued initially in the form of one or more
global Securities (collectively, the “Regulation S Global Security), in each
case without interest coupons and bearing the Global Securities Legend and
Restricted Securities Legend, which shall be deposited on behalf of the
purchasers of the Securities represented thereby with the Securities Custodian,
and registered in the name of the Depositary or a nominee of the Depositary,
duly executed by the Company and authenticated by the Trustee as provided in
this Indenture.  One or more global
securities in definitive, fully registered form without interest coupons and
bearing the Global Securities Legend and the Restricted Securities Legend
(collectively, the “IAI Global Security”) shall also be issued on the Closing
Date, deposited with the Securities Custodian, and registered in the name of
the Depositary or a nominee of the Depositary, duly executed by the Company and
authenticated by the Trustee as provided in this Indenture to accommodate
transfers of beneficial interests in the Securities to IAIs subsequent to the
initial distribution.  Beneficial
ownership interests in the Regulation S Global Security shall not be
exchangeable for interests in the Rule 144A Global Security, the IAI Global
Security or any other Security without a Restricted Securities Legend until the
expiration of the Restricted Period. 
The Rule 144A Global Security, the IAI Global Security and the
Regulation S Global Security are each referred to herein as a “Global Security”
and are collectively referred to herein as “Global Securities”, provided,
that the term “Global Security” when used in Sections 2.1(b), 2.1(c),
2.3(g)(i), 2.3(h)(i) and 2.4 of this Appendix shall also include any Security
in global form issued in connection with a

 

3

 

Registered Exchange Offer or
Private Exchange.  The aggregate
principal amount at maturity of the Global Securities may from time to time be
increased or decreased by adjustments made on the records of the Trustee and
the Depositary or its nominee and on the schedules thereto as hereinafter
provided.

 

(c)  Book-Entry Provisions.  This Section 2.1(c) shall apply only to
a Global Security deposited with or on behalf of the Depositary.

 

The Company
shall execute and the Trustee shall, in accordance with this
Section 2.1(c) and Section 2.2 and pursuant to an order of the
Company signed by two Officers, authenticate and deliver initially one or more
Global Securities that (i) shall be registered in the name of the
Depositary for such Global Security or Global Securities or the nominee of such
Depositary and (ii) shall be delivered by the Trustee to such Depositary
or pursuant to such Depositary’s instructions or held by the Trustee as
Securities Custodian.

 

Members of, or
participants in, the Depositary (“Agent Members”) shall have no rights under
this Indenture with respect to any Global Security held on their behalf by the
Depositary or by the Trustee as Securities Custodian or under such Global
Security, and the Depositary may be treated by the Company, the Trustee and any
agent of the Company or the Trustee as the absolute owner of such Global
Security for all purposes whatsoever. 
Notwithstanding the foregoing, nothing herein shall prevent the Company,
the Trustee or any agent of the Company or the Trustee from giving effect to
any written certification, proxy or other authorization furnished by the
Depositary or impair, as between the Depositary and its Agent Members, the
operation of customary practices of such Depositary governing the exercise of
the rights of a holder of a beneficial interest in any Global Security.

 

(d)  Definitive Securities.  Except as provided in Section 2.3 or
2.4, owners of beneficial interests in Global Securities will not be entitled
to receive physical delivery of certificated Securities.

 

2.2  Authentication.  The Trustee shall authenticate and make
available for delivery upon a written order of the Company signed by two
Officers (a) Original Securities for original issue on the date hereof in
an aggregate principal amount at maturity of $306,000,000, (b) subject to the
terms of this Indenture, Additional Securities in an unlimited aggregate
principal amount at maturity and (c) the (i) Exchange Notes for issue
only in a Registered Exchange Offer and (ii) Private Exchange Notes for issue
only in the Private Exchange, in the case of each of (i) and
(ii) pursuant to the Registration Agreement and for a like principal
amount at maturity of Initial Securities exchanged pursuant thereto.  Such order shall specify the aggregate
principal amount at maturity of the Securities to be authenticated, the date on
which the original issue of Securities is to be authenticated and whether the
Securities are to be Original Securities, Additional Securities, Exchange Notes
or Private Exchange Notes.  The
aggregate principal amount at maturity of Securities outstanding at any time is
unlimited.

 

4

 

2.3  Transfer
and Exchange.  (a)  Transfer
and Exchange of Definitive Securities. 
When Definitive Securities are presented to the Registrar with a
request:

 

(i) to register the transfer of such Definitive Securities; or

 

(ii) to exchange such Definitive Securities for an equal principal
amount at maturity of Definitive Securities of other authorized denominations,

 

the Registrar
shall register the transfer or make the exchange as requested if its reasonable
requirements for such transaction are met; provided, however,
that the Definitive Securities surrendered for transfer or exchange:

 

(1) shall be duly endorsed or accompanied by a written instrument of
transfer in form reasonably satisfactory to the Company and the Registrar, duly
executed by the Holder thereof or his attorney duly authorized in writing; and

 

(2) in the case of Definitive Securities which are Transfer Restricted
Securities, are accompanied by the following additional information and
documents, as applicable:

 

(A) if such Definitive Securities are being delivered to the Registrar
by a Holder for registration in the name of such Holder, without transfer, a
certification from such Holder to that effect (in the form set forth on the
reverse side of the Initial Security or Private Exchange Note, as applicable);
or

 

(B) if such Definitive Securities are being transferred to the Company,
a certification to that effect (in the form set forth on the reverse side of
the Initial Security or Private Exchange Note, as applicable); or

 

(C) if such
Definitive Securities are being transferred pursuant to an exemption from
registration in accordance with Rule 144 under the Securities Act or in
reliance upon another exemption from the registration requirements of the
Securities Act, (x) a certification to that effect (in the form set forth
on the reverse side of the Initial Security or Private Exchange Note, as applicable)
and (y) if the Company so requests, an opinion of counsel or other
evidence reasonably satisfactory to it as to the compliance with the
restrictions set forth in the legend set forth in Section 2.3(e)(i) and
(z) in the case of a transfer to an IAI, a signed letter substantially in
the form of Exhibit D.

 

(b)  Restrictions on Transfer of a Definitive
Security for a Beneficial Interest in a Global Security.  A Definitive Security may not be exchanged
for a beneficial interest in a Global Security except upon satisfaction of the
requirements set forth below.  Upon
receipt by the Trustee of a Definitive Security, duly endorsed or accompanied
by a written instrument of transfer in form reasonably satisfactory to the
Company and the Registrar, together with:

 

5

 

(i) certification (in the form set forth on the reverse side of the
Initial Security or Private Exchange Note, as applicable) that such Definitive
Security is being transferred (1) to a QIB in accordance with Rule 144A,
(2) to an IAI that has furnished to the Trustee a signed letter
substantially in the form of Exhibit D, and in the case of
clause (2), an opinion of counsel or other evidence reasonably
satisfactory to it as to the compliance with the restrictions set forth in the
legend set forth in Section 2.3(e)(i) or (3) outside the United States in
an offshore transaction within the meaning of Regulation S and in compliance
with Rule 904 under the Securities Act; and

 

(ii) written instructions directing the Trustee to make, or to direct
the Securities Custodian to make, an adjustment on its books and records with
respect to such Global Security to reflect an increase in the aggregate
principal amount at maturity of the Securities represented by the Global
Security, such instructions to contain information regarding the Depositary
account to be credited with such increase, then the Trustee shall cancel such
Definitive Security and cause, or direct the Securities Custodian to cause, in
accordance with the standing instructions and procedures existing between the
Depositary and the Securities Custodian, the aggregate principal amount at
maturity of Securities represented by the Global Security to be increased by
the aggregate principal amount at maturity of the Definitive Security to be
exchanged and shall credit or cause to be credited to the account of the Person
specified in such instructions a beneficial interest in the Global Security
equal to the principal amount at maturity of the Definitive Security so
canceled.  If no Global Securities are
then outstanding and the Global Security has not been previously exchanged for
certificated securities pursuant to Section 2.4, the Company shall issue
and the Trustee shall authenticate, upon written order of the Company in the
form of an Officers’ Certificate, a new Global Security in the appropriate
principal amount at maturity.

 

(c)  Transfer and Exchange of Global
Securities.  (i)  The
transfer and exchange of Global Securities or beneficial interests therein shall
be effected through the Depositary, in accordance with this Indenture
(including applicable restrictions on transfer set forth herein, if any) and
the procedures of the Depositary therefor. 
A transferor of a beneficial interest in a Global Security shall deliver
a written order given in accordance with the Depositary’s procedures containing
information regarding the participant account of the Depositary to be credited
with a beneficial interest in such Global Security or another Global Security
and such account shall be credited in accordance with such order with a
beneficial interest in the applicable Global Security and the account of the
Person making the transfer shall be debited by an amount equal to the
beneficial interest in the Global Security being transferred.  Transfers by an owner of a beneficial
interest in the Rule 144A Global Security or the IAI Global Security to a
transferee who takes delivery of such interest through the Regulation S Global
Security, whether before or after the expiration of the Restricted Period,
shall be made only upon receipt by the Trustee of a certification in the form
provided on the reverse of the Initial Securities from the transferor to the
effect that such transfer is being made in accordance with Regulation S or (if
available) Rule 144 under the Securities Act. 
In the case of a transfer of a beneficial interest in the Rule 144A
Global Security for an interest in the IAI

 

6

 

Global Security, the transferee
must furnish a signed letter substantially in the form of Exhibit D to the
Trustee and an opinion of counsel or other evidence reasonably satisfactory to
the Trustee as to the compliance with the restrictions set forth in the legend
set forth in Section 2.3(e)(i).

 

(ii)  If the proposed transfer
is a transfer of a beneficial interest in one Global Security to a beneficial
interest in another Global Security, the Registrar shall reflect on its books
and records the date and an increase in the principal amount at maturity of the
Global Security to which such interest is being transferred in an amount equal
to the principal amount at maturity of the interest to be so transferred, and
the Registrar shall reflect on its books and records the date and a
corresponding decrease in the principal amount at maturity of Global Security
from which such interest is being transferred.

 

(iii)  Notwithstanding any other
provisions of this Appendix (other than the provisions set forth in
Section 2.4), a Global Security may not be transferred as a whole except
by the Depositary to a nominee of the Depositary or by a nominee of the
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.

 

(iv)  In the event that a Global
Security is exchanged for Definitive Securities pursuant to Section 2.4
prior to the consummation of the Registered Exchange Offer or the effectiveness
of the Shelf Registration Statement with respect to such Securities, such
Securities may be exchanged only in accordance with such procedures as are
substantially consistent with the provisions of this Section 2.3
(including the certification requirements set forth on the reverse of the
Initial Securities intended to ensure that such transfers comply with Rule 144A
or such other applicable exemption from registration under the Securities Act,
as the case may be) and such other procedures as may from time to time be
adopted by the Company.

 

(d)  Restrictions on Transfer of
Regulation S Global Security. 
(i) During the Restricted Period, beneficial ownership interests in the
Regulation S Global Security may only be sold, pledged or transferred in
accordance with the Applicable Procedures and only (1) to the Company,
(2) so long as such security is eligible for resale pursuant to
Rule 144A, to a person whom the selling holder reasonably believes is a
QIB that purchases for its own account or for the account of a QIB to whom
notice is given that the resale, pledge or transfer is being made in reliance
on Rule 144A, (3) in an offshore transaction in accordance with
Regulation S, (4) pursuant to an exemption from registration under
the Securities Act provided by Rule 144 (if applicable) under the
Securities Act, (5) to an IAI purchasing for its own account, or for the
account of such an IAI, in a minimum principal amount at maturity of Securities
of $250,000 or (6) pursuant to an effective registration statement under
the Securities Act, in each case in accordance with any applicable securities
laws of any state of the United States. 
Prior to the expiration of the Restricted Period, transfers by an owner
of a beneficial interest in the Regulation S Global Security to a transferee
who takes delivery of such interest through

 

7

 

the Rule 144A Global Security
or the IAI Global Security shall be made only in accordance with Applicable
Procedures and upon receipt by the Trustee of a written certification from the
transferor of the beneficial interest in the form provided on the reverse of
the Initial Security to the effect that such transfer is being made to (1) a
QIB within the meaning of Rule 144A in a transaction meeting the requirements
of Rule 144A or (2) an IAI purchasing for its own account, or for the account
of such an IAI, in a minimum principal amount at maturity of the Securities of
$250,000.  Such written certification
shall no longer be required after the expiration of the Restricted Period.  In the case of a transfer of a beneficial
interest in the Regulation S Global Security for an interest in the IAI
Global Security, the transferee must furnish a signed letter substantially in
the form of Exhibit D to the Trustee.

 

(ii)  Upon the expiration of the
Restricted Period, beneficial ownership interests in the Regulation S Global
Security shall be transferable in accordance with applicable law and the other
terms of this Indenture.

 

(e)  Legend.

 

(i)  Except as permitted by the
following paragraphs (ii), (iii) or (iv), each Security certificate
evidencing the Global Securities and the Definitive Securities (and all
Securities issued in exchange therefor or in substitution thereof) shall bear a
legend in substantially the following form (each defined term in the legend
being defined as such for purposes of the legend only):

 

“THIS SECURITY HAS NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF
1933, AS AMENDED (THE “SECURITIES ACT”), OR THE SECURITIES LAWS OF ANY STATE OR
OTHER JURISDICTION.  NEITHER THIS
SECURITY NOR ANY INTEREST OR PARTICIPATION HEREIN MAY BE REOFFERED, SOLD,
ASSIGNED, TRANSFERRED, PLEDGED, ENCUMBERED OR OTHERWISE DISPOSED OF IN THE
ABSENCE OF SUCH REGISTRATION OR UNLESS SUCH TRANSACTION IS EXEMPT FROM, OR NOT
SUBJECT TO, SUCH REGISTRATION.

 

THE HOLDER OF THIS SECURITY, BY ITS ACCEPTANCE HEREOF, AGREES ON ITS
BEHALF AND ON BEHALF OF ANY INVESTOR ACCOUNT FOR WHICH IT HAS PURCHASED
SECURITIES, TO OFFER, SELL OR OTHERWISE TRANSFER SUCH SECURITY, PRIOR TO THE
DATE (THE “RESALE RESTRICTION TERMINATION DATE”) THAT IS [IN THE CASE OF RULE 144A NOTES: TWO
YEARS] [IN
THE CASE OF REGULATION S NOTES: 40 DAYS] AFTER THE LATER OF THE
ORIGINAL ISSUE DATE HEREOF AND THE LAST DATE ON WHICH THE COMPANY OR ANY
AFFILIATE OF THE COMPANY WAS THE OWNER OF THIS SECURITY (OR ANY PREDECESSOR OF
SUCH SECURITY), ONLY (A) TO THE COMPANY, (B) PURSUANT TO A
REGISTRATION STATEMENT THAT HAS BEEN DECLARED EFFECTIVE UNDER THE SECURITIES
ACT, (C) FOR SO LONG AS THE SECURITIES ARE ELIGIBLE FOR RESALE PURSUANT TO
RULE 144A UNDER THE SECURITIES ACT, TO

 

8

 

A PERSON IT REASONABLY BELIEVES IS A “QUALIFIED INSTITUTIONAL BUYER” AS
DEFINED IN RULE 144A UNDER THE SECURITIES ACT THAT PURCHASES FOR ITS OWN
ACCOUNT OR FOR THE ACCOUNT OF A QUALIFIED INSTITUTIONAL BUYER TO WHOM NOTICE IS
GIVEN THAT THE TRANSFER IS BEING MADE IN RELIANCE ON RULE 144A, (D) PURSUANT TO
OFFERS AND SALES THAT OCCUR OUTSIDE THE UNITED STATES WITHIN THE MEANING OF
REGULATION S UNDER THE SECURITIES ACT, (E) TO AN INSTITUTIONAL “ACCREDITED
INVESTOR” WITHIN THE MEANING OF RULE 501(a)(1), (2), (3) OR (7) UNDER THE
SECURITIES ACT THAT IS AN INSTITUTIONAL ACCREDITED INVESTOR ACQUIRING THE
SECURITY FOR ITS OWN ACCOUNT OR FOR THE ACCOUNT OF SUCH AN INSTITUTIONAL
ACCREDITED INVESTOR, IN EACH CASE IN A MINIMUM PRINCIPAL AMOUNT AT MATURITY OF
THE SECURITIES OF $250,000, FOR INVESTMENT PURPOSES AND NOT WITH A VIEW TO OR
FOR OFFER OR SALE IN CONNECTION WITH ANY DISTRIBUTION IN VIOLATION OF THE
SECURITIES ACT OR (F) PURSUANT TO ANOTHER AVAILABLE EXEMPTION FROM THE
REGISTRATION REQUIREMENTS OF THE SECURITIES ACT, SUBJECT TO THE COMPANY’S AND
THE TRUSTEE’S RIGHT PRIOR TO ANY SUCH OFFER, SALE OR TRANSFER PURSUANT TO
CLAUSES (D), (E) OR (F) TO REQUIRE THE DELIVERY OF AN OPINION OF COUNSEL,
CERTIFICATION AND/OR OTHER INFORMATION SATISFACTORY TO EACH OF THEM.  THIS LEGEND WILL BE REMOVED UPON THE REQUEST
OF THE HOLDER AFTER THE RESALE RESTRICTION TERMINATION DATE.”

 

Each
Definitive Security shall bear the following additional legend:

 

“IN CONNECTION WITH ANY TRANSFER, THE HOLDER WILL DELIVER TO THE
REGISTRAR AND TRANSFER AGENT SUCH CERTIFICATES AND OTHER INFORMATION AS SUCH
TRANSFER AGENT MAY REASONABLY REQUIRE TO CONFIRM THAT THE TRANSFER COMPLIES
WITH THE FOREGOING RESTRICTIONS.”

 

(ii)  Upon any sale or transfer
of a Transfer Restricted Security that is a Definitive Security, the Registrar
shall permit the Holder thereof to exchange such Transfer Restricted Security
for a Definitive Security that does not bear the legends set forth above and
rescind any restriction on the transfer of such Transfer Restricted Security if
the Holder certifies in writing to the Registrar that its request for such
exchange was made in reliance on Rule 144 (such certification to be in the
form set forth on the reverse of the Initial Security, or Private Exchange
Note, as applicable) and delivers an opinion of counsel or other evidence
reasonably satisfactory to the Registrar as to the compliance with the
restrictions set forth in the legend set forth in Section 2.3(e)(i)).

 

9

 

(iii)  After a transfer of any
Initial Securities or Private Exchange Notes during the period of the
effectiveness of a Shelf Registration Statement with respect to such Initial
Securities or Private Exchange Notes, as the case may be, all requirements
pertaining to the Restricted Securities Legend on such Initial Securities or
such Private Exchange Notes shall cease to apply and the requirements that any
such Initial Securities or such Private Exchange Notes be issued in global form
shall continue to apply.

 

(iv)  Upon the consummation of a
Registered Exchange Offer with respect to the Initial Securities pursuant to
which Holders of such Initial Securities are offered Exchange Notes in exchange
for their Initial Securities, all requirements pertaining to Initial Securities
that Initial Securities be issued in global form shall continue to apply, and
Exchange Notes in global form without the Restricted Securities Legend shall be
available to Holders that exchange such Initial Securities in such Registered
Exchange Offer.

 

(v)  Upon the consummation of a
Private Exchange with respect to the Initial Securities pursuant to which
Holders of such Initial Securities are offered Private Exchange Notes in
exchange for their Initial Securities, all requirements pertaining to such
Initial Securities that Initial Securities be issued in global form shall
continue to apply, and Private Exchange Notes in global form with the
Restricted Securities Legend shall be available to Holders that exchange such
Initial Securities in such Private Exchange.

 

(vi)  Upon a sale or transfer
after the expiration of the Restricted Period of any Initial Security acquired
pursuant to Regulation S, all requirements that such Initial Security bear the
Restricted Securities Legend shall cease to apply and the requirements
requiring any such Initial Security be issued in global form shall continue to
apply.

 

(vii)  Any Additional Securities
sold in a registered offering shall not be required to bear the Restricted
Notes Legend.

 

(f)  Cancelation or Adjustment of Global
Security.  At such time as all
beneficial interests in a Global Security have either been exchanged for
Definitive Securities, transferred, redeemed, repurchased or canceled, such
Global Security shall be returned by the Depositary to the Trustee for
cancelation or retained and canceled by the Trustee.  At any time prior to such cancelation, if any beneficial interest
in a Global Security is exchanged for Definitive Securities, transferred in
exchange for an interest in another Global Security, redeemed, repurchased or
canceled, the principal amount at maturity of Securities represented by such
Global Security shall be reduced and an adjustment shall be made on the books
and records of the Trustee (if it is then the Securities Custodian for such
Global Security) with respect to such Global Security, by the Trustee or the
Securities Custodian, to reflect such reduction.

 

10

 

(g)  Obligations with Respect to Transfers and
Exchanges of Securities.

 

(i)  To permit registrations of
transfers and exchanges, the Company shall execute and the Trustee shall
authenticate, Definitive Securities and Global Securities at the Registrar’s
request.

 

(ii)  No service charge shall be
made for any registration of transfer or exchange, but the Company may require
payment of a sum sufficient to cover any transfer tax, assessments, or similar
governmental charge payable in connection therewith (other than any such transfer
taxes, assessments or similar governmental charge payable upon exchanges to be
registered in the name of the registered Holder effecting the exchange pursuant
to Sections 2.06, 3.06, 4.06, 4.08 and 9.05 of this Indenture).

 

(iii)  Prior to the due presentation
for registration of transfer of any Security, the Company, the Trustee, the
Paying Agent or the Registrar may deem and treat the person in whose name a
Security is registered as the absolute owner of such Security for the purpose
of receiving payment of principal of and interest on such Security and for all
other purposes whatsoever, whether or not such Security is overdue, and none of
the Company, the Trustee, the Paying Agent or the Registrar shall be affected
by notice to the contrary.

 

(iv)  All Securities issued upon
any transfer or exchange pursuant to the terms of this Indenture shall evidence
the same debt and shall be entitled to the same benefits under this Indenture
as the Securities surrendered upon such transfer or exchange.

 

(h)  No Obligation of the Trustee.

 

(i)  The Trustee shall have no
responsibility or obligation to any beneficial owner of a Global Security, a
member of, or a participant in the Depositary or any other Person with respect
to the accuracy of the records of the Depositary or its nominee or of any
participant or member thereof, with respect to any ownership interest in the
Securities or with respect to the delivery to any participant, member,
beneficial owner or other Person (other than the Depositary) of any notice
(including any notice of redemption or repurchase) or the payment of any
amount, under or with respect to such Securities.  All notices and communications to be given to the Holders and all
payments to be made to Holders under the Securities shall be given or made only
to the registered Holders (which shall be the Depositary or its nominee in the
case of a Global Security).  The rights
of beneficial owners in any Global Security shall be exercised only through the
Depositary subject to the applicable rules and procedures of the
Depositary.  The Trustee may rely and
shall be fully protected in relying upon information furnished by the
Depositary with respect to its members, participants and any beneficial owners.

 

11

 

(ii)  The Trustee shall have no
obligation or duty to monitor, determine or inquire as to compliance with any
restrictions on transfer imposed under this Indenture or under applicable law
with respect to any transfer of any interest in any Security (including any
transfers between or among Depositary participants, members or beneficial
owners in any Global Security) other than to require delivery of such
certificates and other documentation or evidence as are expressly required by,
and to do so if and when expressly required by, the terms of this Indenture,
and to examine the same to determine substantial compliance as to form with the
express requirements hereof.

 

2.4  Definitive
Securities

 

(a)  A Global Security deposited with the
Depositary or with the Trustee as Securities Custodian pursuant to
Section 2.1 or issued in connection with a Registered Exchange Offer or
Private Exchange shall be transferred to the beneficial owners thereof in the
form of Definitive Securities in an aggregate principal amount at maturity
equal to the principal amount at maturity of such Global Security, in exchange
for such Global Security, only if such transfer complies with Section 2.3
and (i) the Depositary notifies the Company that it is unwilling or unable
to continue as a Depositary for such Global Security or if at any time the
Depositary ceases to be a “clearing agency” registered under the Exchange Act,
and a successor depositary is not appointed by the Company within 90 days
of such notice or after the Company becomes aware of such cessation, or
(ii) an Event of Default has occurred and is continuing or (iii) the
Company, in its sole discretion, notifies the Trustee in writing that it elects
to cause the issuance of certificated Securities under this Indenture.

 

(b)  Any Global Security that is transferable to
the beneficial owners thereof pursuant to this Section 2.4 shall be
surrendered by the Depositary to the Trustee, to be so transferred, in whole or
from time to time in part, without charge, and the Trustee shall authenticate
and deliver, upon such transfer of each portion of such Global Security, an
equal aggregate principal amount at maturity of Definitive Securities of
authorized denominations.  Any portion
of a Global Security transferred pursuant to this Section shall be executed,
authenticated and delivered only in denominations of $1,000 principal amount at
maturity and any integral multiple thereof and registered in such names as the
Depositary shall direct.  Any
certificated Initial Security in the form of a Definitive Security delivered in
exchange for an interest in the Global Security shall, except as otherwise
provided by Section 2.3(d), bear the Restricted Securities Legend.

 

(c)  Subject to the provisions of
Section 2.4(b), the registered Holder of a Global Security may grant
proxies and otherwise authorize any Person, including Agent Members and Persons
that may hold interests through Agent Members, to take any action which a
Holder is entitled to take under this Indenture or the Securities.

 

(d)  In the event of the occurrence of any of the
events specified in Section 2.4(a)(i), (ii) or (iii), the Company
will promptly make available to the Trustee a reasonable supply of Definitive
Securities in fully registered form without interest coupons.

 

12

 

EXHIBIT A

 

[FORM OF FACE OF INITIAL SECURITY

AND PRIVATE EXCHANGE NOTE]

 

[Global Securities Legend]

 

UNLESS THIS
CERTIFICATE IS PRESENTED BY AN AUTHORIZED REPRESENTATIVE OF THE DEPOSITORY
TRUST COMPANY, A NEW YORK CORPORATION (“DTC”), NEW YORK,
NEW YORK, TO THE COMPANY OR ITS AGENT FOR REGISTRATION OF TRANSFER,
EXCHANGE OR PAYMENT, AND ANY CERTIFICATE ISSUED IS REGISTERED IN THE NAME OF
CEDE & CO. OR SUCH OTHER NAME AS IS REQUESTED BY AN AUTHORIZED REPRESENTATIVE
OF DTC (AND ANY PAYMENT IS MADE TO CEDE & CO., OR TO SUCH OTHER ENTITY
AS IS 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.

 

TRANSFERS OF
THIS GLOBAL SECURITY SHALL BE LIMITED TO TRANSFERS IN WHOLE, BUT NOT IN PART,
TO DTC, TO NOMINEES OF DTC OR TO A SUCCESSOR THEREOF OR SUCH SUCCESSOR’S
NOMINEE AND TRANSFERS OF PORTIONS OF THIS GLOBAL SECURITY SHALL BE LIMITED TO
TRANSFERS MADE IN ACCORDANCE WITH THE RESTRICTIONS SET FORTH IN THE INDENTURE
REFERRED TO ON THE REVERSE HEREOF.

 

[Restricted Securities Legend]

 

THIS SECURITY
HAS NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED (THE
“SECURITIES ACT”), OR THE SECURITIES LAWS OF ANY STATE OR OTHER
JURISDICTION.  NEITHER THIS SECURITY NOR
ANY INTEREST OR PARTICIPATION HEREIN MAY BE REOFFERED, SOLD, ASSIGNED,
TRANSFERRED, PLEDGED, ENCUMBERED OR OTHERWISE DISPOSED OF IN THE ABSENCE OF
SUCH REGISTRATION OR UNLESS SUCH TRANSACTION IS EXEMPT FROM, OR NOT SUBJECT TO,
SUCH REGISTRATION.

 

THE HOLDER OF
THIS SECURITY, BY ITS ACCEPTANCE HEREOF, AGREES ON ITS BEHALF AND ON BEHALF OF
ANY INVESTOR ACCOUNT FOR WHICH IT HAS PURCHASED SECURITIES, TO OFFER, SELL OR
OTHERWISE TRANSFER SUCH SECURITY, PRIOR TO THE DATE (THE “RESALE RESTRICTION
TERMINATION DATE”) THAT IS [IN THE CASE OF RULE 144A NOTES: TWO YEARS]
[IN THE
CASE OF REGULATION S NOTES: 40 DAYS] AFTER THE LATER OF THE ORIGINAL
ISSUE DATE HEREOF AND THE LAST DATE ON WHICH THE COMPANY OR ANY AFFILIATE OF
THE COMPANY WAS THE OWNER OF THIS SECURITY (OR ANY PREDECESSOR OF SUCH
SECURITY), ONLY (A) TO THE COMPANY, (B) PURSUANT TO A REGISTRATION STATEMENT
THAT HAS BEEN DECLARED EFFECTIVE

 

 

UNDER THE SECURITIES ACT, (C)
FOR SO LONG AS THE SECURITIES ARE ELIGIBLE FOR RESALE PURSUANT TO RULE 144A
UNDER THE SECURITIES ACT, TO A PERSON IT REASONABLY BELIEVES IS A “QUALIFIED
INSTITUTIONAL BUYER” AS DEFINED IN RULE 144A UNDER THE SECURITIES ACT THAT
PURCHASES FOR ITS OWN ACCOUNT OR FOR THE ACCOUNT OF A QUALIFIED INSTITUTIONAL
BUYER TO WHOM NOTICE IS GIVEN THAT THE TRANSFER IS BEING MADE IN RELIANCE ON
RULE 144A, (D) PURSUANT TO OFFERS AND SALES THAT OCCUR OUTSIDE THE UNITED
STATES WITHIN THE MEANING OF REGULATION S UNDER THE SECURITIES ACT, (E) TO AN
INSTITUTIONAL “ACCREDITED INVESTOR” WITHIN THE MEANING OF RULE 501(a)(1), (2),
(3) OR (7) UNDER THE SECURITIES ACT THAT IS AN INSTITUTIONAL ACCREDITED
INVESTOR ACQUIRING THE SECURITY FOR ITS OWN ACCOUNT OR FOR THE ACCOUNT OF SUCH
AN INSTITUTIONAL ACCREDITED INVESTOR, IN EACH CASE IN A MINIMUM PRINCIPAL
AMOUNT AT MATURITY OF THE SECURITIES OF $250,000, FOR INVESTMENT PURPOSES AND
NOT WITH A VIEW TO OR FOR OFFER OR SALE IN CONNECTION WITH ANY DISTRIBUTION IN
VIOLATION OF THE SECURITIES ACT OR (F) PURSUANT TO ANOTHER AVAILABLE EXEMPTION
FROM THE REGISTRATION REQUIREMENTS OF THE SECURITIES ACT, SUBJECT TO THE
COMPANY’S AND THE TRUSTEE’S RIGHT PRIOR TO ANY SUCH OFFER, SALE OR TRANSFER
PURSUANT TO CLAUSES (D), (E) OR (F) TO REQUIRE THE DELIVERY OF AN OPINION OF
COUNSEL, CERTIFICATION AND/OR OTHER INFORMATION SATISFACTORY TO EACH OF
THEM.  THIS LEGEND WILL BE REMOVED UPON
THE REQUEST OF THE HOLDER AFTER THE RESALE RESTRICTION TERMINATION DATE.

 

Each Definitive
Security shall bear the following additional legend:

 

IN CONNECTION
WITH ANY TRANSFER, THE HOLDER WILL DELIVER TO THE REGISTRAR AND TRANSFER AGENT
SUCH CERTIFICATES AND OTHER INFORMATION AS SUCH TRANSFER AGENT MAY REASONABLY
REQUIRE TO CONFIRM THAT THE TRANSFER COMPLIES WITH THE FOREGOING RESTRICTIONS.

 

2

 

	
  No.

  	
  $

  
	
   

  	
   

  
	
   

  	
   

  
	
  111/8%
  Senior Secured Discount Note due 2009

  
	
   

  
	
   

  
	
  CUSIP No.

  	
   

  
	
  ISIN No.

  	
   

  
			

 

PLIANT
CORPORATION, a Utah corporation, promises to pay to Cede & Co., or
registered assigns, the principal amount at maturity [listed on the Schedule of
Increases or Decreases in Global Security attached hereto](1) [of
$            ](2)
on June 15, 2009.

 

Interest
Payment Dates:  June 15 and December 15.

 

Record Dates:  June 1 and December 1.

 

(1) Insert if
Security is to be issued in global form.

 

(2) Insert if
Security is to be issued in definitive form.

 

3

 

Additional
provisions of this Security are set forth on the other side of this Security.

 

IN WITNESS
WHEREOF, the parties have caused this instrument to be duly executed. 

 

	
   

  	
  PLIANT CORPORATION,

  
	
   

  	
   

  
	
   

  	
   

  	
  by

  	
   

  
	
   

  	
   

  	
  Name:

  
	
   

  	
   

  	
  Title:

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  by

  	
   

  
	
   

  	
   

  	
  Name:

  
	
   

  	
   

  	
  Title:

  
					

 

 

	
  Dated:

  	
   

  
	
   

  	
   

  
	
  TRUSTEE’S
  CERTIFICATE OF

  AUTHENTICATION

  	
   

  
	
   

  	
   

  
	
  WILMINGTON TRUST COMPANY,

  	
   

  
	
   

  	
   

  
	
  as Trustee, certifies that this is one of

  the Securities referred to in the Indenture.

  	
   

  
	
   

  	
   

  
	
  by

  	
   

  	
   

  	
   

  
	
  Authorized
  Signatory

  	
   

  
				

 

*/ If the Security
is to be issued in global form, add the Global Securities Legend and the attachment
from Exhibit A captioned “TO BE ATTACHED TO GLOBAL SECURITIES - SCHEDULE OF
INCREASES OR DECREASES IN GLOBAL SECURITY”.

 

4

 

[FORM OF REVERSE SIDE OF INITIAL SECURITY

AND PRIVATE EXCHANGE NOTE]

 

111/8%
Senior Discount Secured Note due 2009

 

1.  Accreted Value; Interest

 

(a) PLIANT CORPORATION,
a Utah corporation (such corporation, and its successors and assigns under
the Indenture hereinafter referred to, being herein called the “Company”),
promises to pay interest on the principal amount at maturity of this Security
at the rate per annum shown above.

 

All references
in this Security, in any context, to Accreted Value or any interest or other
amount payable on or with respect to the Notes shall be deemed to include any
Additional Interest pursuant to the Registration Agreement.

 

Unless the
Company elects to pay cash interest as described below, no cash interest will
accrue on the Securities prior to December 15, 2006.  The Accreted Value of each Security will
increase from the date of issuance until December 15, 2006, at a rate of
111⁄8% per annum, compounded semiannually on each June 15 and
December 15 commencing June 15, 2004, reflecting the accrual of
non-cash interest, such that the Accreted Value will equal the stated principal
amount at maturity on December 15, 2006. 
Cash interest on the Securities will accrue at the rate of 111⁄8%
per annum from December 15, 2006, or from the most recent date to which
interest has been paid or provided for, and will be payable in cash
semiannually on June 15 and December 15 of each year (each an
“Interest Payment Date”), commencing on June 15, 2007, to holders of
record on the immediately preceding June 1 and December 1,
respectively.  Notwithstanding the
foregoing, on any Interest Payment Date prior to December 15, 2006, the
Company may elect to commence to pay cash interest (from and after such
Interest Payment Date), in which case (i) the Company will be obligated to
pay cash interest on each subsequent Interest Payment Date, (ii) the
Securities will cease to accrete after such Interest Payment Date and
(iii) the outstanding principal amount at Stated Maturity of each Security
will be equal to the Accreted Value of such Security as of such Interest
Payment Date. Interest and Accreted Value will be computed on the basis of a
360-day year comprised of twelve 30-day months. The Company shall pay interest
on overdue principal at the rate borne by the Securities, and it shall pay
interest on overdue installments of interest at the same rate to the extent
lawful.  Interest will be payable as
described in the foregoing paragraph, except as described under
paragraph 14 of this Security.

 

“Accreted
Value” as of any date (the “Specified Date”) means, with respect to each $1,000
principal amount at maturity of the Securities (subject to the latest sentence
of this definition):

 

(i) if the Specified Date is one of the following dates (each a
“Semi-Annual Accretion Date”), the amount set forth opposite each date below:

 

5

 

	
  Semi-Annual Accretion Date

  	
   

  	
  Accreted

  Value

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  Issue Date

  	
   

  	
  $

  	
  736.27

  	
   

  
	
  June 15, 2004

  	
   

  	
  $

  	
  762.87

  	
   

  
	
  December 15, 2004

  	
   

  	
  $

  	
  805.31

  	
   

  
	
  June 15, 2005

  	
   

  	
  $

  	
  850.10

  	
   

  
	
  December 15, 2005

  	
   

  	
  $

  	
  897.39

  	
   

  
	
  June 15, 2006

  	
   

  	
  $

  	
  947.31

  	
   

  
	
  December 15, 2006

  	
   

  	
  $

  	
  1,000.00

  	
   

  

 

(ii) if the Specified Date occurs between two Semi-Annual Accretion
Dates, the sum of (a) the Accreted Value for the Semi-Annual Accretion Date
immediately preceding the Specified Date and (b) an amount equal to the product
of (x) the Accreted Value for the immediately following Semi-Annual Accretion
Date less the Accreted Value of the immediately preceding Semi-Annual Accretion
Date and (y) the fraction, the numerator of which is the number of days
actually elapsed from the immediately preceding Semi-Annual Accretion Date and
the denominator of which is 180; or

 

(iii) if the Specified Date is after December 15, 2006, $1,000.

 

For the
purposes hereof, if the Specified Date is prior to December 15, 2006 but
on or after the date on which the Company elects to commence to pay cash
interest (the “Cash Election Date”), all references in this document to
Accreted Value in respect of any Security shall be to the aggregate principal
amount of such Security, which shall be equal to the Accreted Value of the such
Security as of the Cash Election Date determined in accordance with clauses (i)
and (ii) above.  If Additional Interest
is payable with respect to any Security prior to the earlier of (A) the
Cash Election Date and (B) December 15, 2006, the Accreted Value of
such Security shall be increased to reflect such Additional Interest.

 

(b) Additional Interest.  The holder of this Security is entitled to
the benefits of an Exchange and Registration Rights Agreement, dated as of
February 17, 2004 among the Company, Pliant Corporation International,
Pliant Film Products of Mexico, Inc., Pliant Solutions Corporation, Pliant
Packaging of Canada, LLC, Uniplast Holdings Inc., Uniplast U.S., Inc., Turex,
Inc., Pierson Industries, Inc., Uniplast Midwest, Inc. and Uniplast Industries
Co. (the “Note Guarantors”) and the Initial Purchasers named therein (the
“Registration Agreement”).  Capitalized
terms used in this paragraph (b) but not defined herein have the meanings
assigned to them in the Registration Agreement.  Subject to the terms of the Registration Agreement, if
(i) the Shelf Registration Statement or Exchange Offer Registration
Statement, as applicable under the Registration Agreement, is not filed with
the Commission on or prior to the date specified in the Registration Agreement,
(ii) the Exchange Offer Registration Statement or the Shelf Registration
Statement, as the case may be, is not declared effective on or prior to the
date specified in the Registration Agreement, (iii) the Registered Exchange
Offer is not

 

6

 

consummated on or prior to
190 days after the Issue Date (other than in the event the Company files a
Shelf Registration Statement), or (iv) the Shelf Registration Statement is filed
and declared effective on or prior to the date specified in the Registration
Agreement but shall thereafter cease to be effective (at any time that the
Company is obligated to maintain the effectiveness thereof) without being
succeeded within 60 days by an additional Registration Statement filed and
declared effective (each such event referred to in clauses (i) through
(iv), a “Registration Default”), the interest rate on Securities constituting
Transfer Restricted Securities, during the period of such Registration Default,
shall be increased by 1.0% per annum (the amount paid as a result of such
increase being herein referred to as “liquidated damages”) until the applicable
Registration Statement is filed or declared effective, the Registered Exchange
Offer is consummated or the Shelf Registration Statement again becomes
effective, an additional Registration Statement becomes effective or a
post-effective amendment to the Shelf Registration Statement becomes effective,
as the case may be.  With respect to any
liquidated damages due after the earlier of (i) December 15, 2006 and
(ii) the Cash Election Date, such liquidated damages shall be paid to
holders in the same manner as cash interest payments on the Securities on
semi-annual payment dates which correspond to Interest Payment Dates for the
Securities.  With respect to any
liquidated damages due on or prior to the earlier of (i) December 15,
2006 and (ii) the Cash Election Date, such liquidated damages shall be
added to the Accreted Value of the Securities. Following the cure of all
Registration Defaults, the accrual of liquidated damages shall cease.  The Trustee shall have no responsibility
with respect to the determination of the amount of any such liquidated
damages.  For purposes of the foregoing,
“Transfer Restricted Securities” means (i) each Initial Security until the
date on which such Initial Security has been exchanged for a freely
transferable Exchange Note in the Registered Exchange Offer, it being
understood that the requirement that an Exchange Dealer deliver a prospectus in
connection with sales of Exchange Notes acquired in the Registered Exchange
Offer shall not mean that the Exchange Note is not freely transferable,
(ii) each Initial Security or Private Exchange Note until the date on
which such Initial Security or Private Exchange Note has been effectively
registered under the Securities Act and disposed of in accordance with a Shelf
Registration Statement or (iii) each Initial Security or Private Exchange
Note until the date on which such Initial Security or Private Exchange Note is
distributed to the public pursuant to Rule 144 under the Securities Act or is
saleable pursuant to Rule 144(k) under the Securities Act.  The Company shall not be required to pay
liquidated damages to any Holder of Transfer Restricted Securities to the
extent such Holder fails to comply with certain obligations specified in the
Registration Agreement.

 

2. Method of Payment

 

The Company
shall pay interest on the Securities (except defaulted interest) to the Persons
who are registered Holders at the close of business on the June 1 and
December 1 next preceding the Interest Payment Date even if Securities are
canceled after the record date and on or before the Interest Payment Date.  Holders must surrender Securities to a
Paying Agent to collect principal payments. 
The Company shall pay principal, premium, if any, liquidated damages, if
any, and interest in money of the United States of America that at the
time of payment is legal tender for payment of public

 

7

 

and private debts.  Payments in respect of the Securities
represented by a Global Security (including principal, premium, if any,
liquidated damages, if any, and interest) shall be made by wire transfer of
immediately available funds to the accounts specified by The Depository Trust
Company or any successor depositary. 
The Company will make all payments in respect of a certificated Security
(including principal, premium, if any, interest and liquidated damages, if
any), at the office of the Paying Agent, except that, at the option of the
Company, payment of interest or liquidated damages may be made by mailing a
check to the registered address of each Holder thereof; provided, however,
that payments on the Securities may also be made, in the case of a Holder of at
least $1,000,000 aggregate principal amount at maturity of Securities, by wire
transfer to a U.S. dollar account maintained by the payee with a bank in the
United States if such Holder elects payment by wire transfer by giving
written notice to the Trustee or the Paying Agent to such effect designating
such account no later than 30 days immediately preceding the relevant due
date for payment (or such other date as the Trustee may accept in its discretion).

 

3.  Paying Agent and Registrar

 

Initially,
WILMINGTON TRUST COMPANY, a Delaware banking corporation (the “Trustee”), will
act as Paying Agent and Registrar.  The
Company may appoint and change any Paying Agent or Registrar without notice.  The Company or any of its domestically
incorporated Wholly Owned Subsidiaries may act as Paying Agent or Registrar.

 

4.  Indenture

 

The Company
issued the Securities under an Indenture dated as of February 17, 2004
(the “Indenture”), among the Company, the Note Guarantors and the Trustee.  The terms of the Securities include those
stated in the Indenture and those made part of the Indenture by reference to
the Trust Indenture Act of 1939 (15 U.S.C. §§ 77aaa-77bbbb) as in
effect on the date of the Indenture (the “TIA”).  Terms defined in the Indenture and not defined herein have the
meanings ascribed thereto in the Indenture. 
The Securities are subject to all terms and provisions of the Indenture,
and Holders (as defined in the Indenture) are referred to the Indenture and the
TIA for a statement of such terms and provisions.

 

The Securities
are senior secured obligations of the Company. 
The Company shall be entitled, subject to its compliance with Section
4.03 of the Indenture, to issue Additional Securities pursuant to Section 2.01
of the Indenture.  This Security is one
of the [Original Securities] [Additional Securities] [Private Exchange Notes]
referred to in the Indenture.  The Securities
include the Original Securities, the Additional Securities and any Exchange
Notes and Private Exchange Notes issued in exchange for the Initial Securities
pursuant to the Indenture.  The Original
Securities, the Additional Securities and any Exchange Notes and Private
Exchange Notes are treated as a single class of securities under the
Indenture.  The Indenture imposes
certain limitations on the ability of the Company and its Restricted
Subsidiaries to, among other things, make certain Investments and other
Restricted Payments, pay dividends and other distributions,

 

8

 

incur Indebtedness, enter into
consensual restrictions upon the payment of certain dividends and distributions
by such Restricted Subsidiaries, enter into or permit certain transactions with
Affiliates, make asset sales and incur Liens. 
The Indenture also imposes limitations on the ability of the Company and
each Note Guarantor to consolidate or merge with or into any other Person or
the Company to convey, transfer or lease all or substantially all of its
property.

 

To guarantee
the due and punctual payment of the principal, interest and liquidated damages,
if any, on the Securities and all other amounts payable by the Company under
the Indenture and the Securities when and as the same shall be due and payable,
whether at maturity, by acceleration or otherwise, according to the terms of
the Securities and the Indenture, the Note Guarantors have, jointly and
severally, unconditionally guaranteed the Guaranteed Obligations on a senior
secured basis pursuant to the terms of the Indenture.

 

The Securities
are secured (i) on a first-priority basis with respect to the
First-Priority Collateral and (ii) on a second-priority basis with respect
to the Second-Priority Collateral, in each case, by the Liens created by the
Security Documents pursuant to, and subject to, the terms of the Indenture and
the Intercreditor Agreement.

 

5.  Optional Redemption

 

Except as set
forth in the following paragraph, the Securities shall not be redeemable at the
option of the Company prior to June 15, 2007.  On or after June 15, 2007, the Securities shall be
redeemable at the option of the Company, in whole or in part, on not less than
30 nor more than 60 days prior notice, at the following redemption prices
(expressed as percentages of principal amount), plus accrued and unpaid
interest and liquidated damages, if any, to the redemption date (subject to the
right of Holders of record on the relevant record date to receive interest and
liquidated damages, if any, due on the relevant Interest Payment Date), if
redeemed during the 12-month period commencing on June 15 of the years set
forth below (or, in the case of June 15, 2009, on such date):

 

	
  Year

  	
   

  	
  Redemption

  Price

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  2007

  	
   

  	
  105.563

  	
  %

  
	
  2008

  	
   

  	
  102.781

  	
  %

  
	
  2009

  	
   

  	
  100.000

  	
  %

  

 

In addition,
prior to June 15, 2007, the Company may redeem up to a maximum of 35% of
the Accreted Value of the Securities (calculated after giving effect to any
issuance of Additional Securities) with the Net Cash Proceeds of one or more
Equity Offerings by the Company at a redemption price equal to 111.125% of the
Accreted Value at the date of redemption, plus accrued and unpaid interest and
liquidated

 

9

 

damages thereon, if any, to the
date of redemption; provided, however, that after giving effect
to any such redemption, at least 65% of the Accreted Value of the Securities
(calculated after giving effect to any issuance of Additional Securities)
remains outstanding, and any such redemption shall be made within 120 days
of such Equity Offering upon not less than 30 nor more than 60 days
notice mailed to each Holder of Securities being redeemed and otherwise in
accordance with the procedures set forth in the Indenture.

 

6.  Sinking Fund

 

The Securities
are not subject to any sinking fund.

 

7.  Notice of Redemption

 

Notice of
redemption will be mailed by first-class mail at least 30 days but not
more than 60 days before the redemption date to each Holder of Securities
to be redeemed at his or her registered address.  Securities in denominations larger than $1,000 principal amount
at maturity may be redeemed in part but only in whole multiples of $1,000
principal amount at maturity.  If money
sufficient to pay the redemption price of and accrued and unpaid interest and
liquidated damages, if any, on all Securities (or portions thereof) to be
redeemed on the redemption date is deposited with the Paying Agent on or before
the redemption date and certain other conditions are satisfied, on and after
such date interest (and, if applicable, liquidated damages) ceases to accrue on
such Securities (or such portions thereof) called for redemption.

 

8.  Repurchase of Securities at the Option of Holders upon Change
of Control

 

Upon a Change
of Control, any Holder of Securities will have the right, subject to certain
conditions specified in the Indenture, to cause the Company to repurchase all
or any part of the Securities of such Holder at a purchase price equal to 101%
of the Accreted Value or principal amount of the Securities to be repurchased plus
accrued and unpaid interest and liquidated damages, if any, to the date of
repurchase (subject to the right of Holders of record on the relevant record
date to receive interest due and liquidated damages, if any, on the relevant
Interest Payment Date that is on or prior to the date of purchase) as provided
in, and subject to the terms of, the Indenture.

 

In accordance
with Section 4.06 of the Indenture, the Company will be required to offer
to purchase Securities upon the occurrence of certain events.

 

9.  Denominations; Transfer; Exchange

 

The Securities
are in registered form without coupons in denominations of $1,000 principal
amount at maturity and whole multiples of $1,000 principal amount at
maturity.  A Holder may transfer or
exchange Securities in accordance with, and subject to the restrictions on
transfer and exchange set forth in, the Indenture.  Upon any transfer or exchange, the Registrar and the Trustee may
require a Holder, among other things, to furnish appropriate endorsements or
transfer documents and to pay any taxes required by law or permitted by the
Indenture.  The Registrar need not
register the transfer of or

 

10

 

exchange any Securities
selected for redemption (except, in the case of a Security to be redeemed in
part, the portion of the Security not to be redeemed) or to transfer or
exchange any Securities for a period of 15 days prior to a selection of
Securities to be redeemed.

 

10.  Persons Deemed Owners

 

Except as
provided in paragraph 2 hereof, the registered Holder of this Security may be
treated as the owner of it for all purposes.

 

11.  Unclaimed Money

 

If money for
the payment of principal, interest or liquidated damages, if any, remains
unclaimed for two years, the Trustee and the Paying Agent shall pay the money
back to the Company at its written request unless an abandoned property law
designates another Person.  After any
such payment, Holders entitled to the money must look only to the Company for
payment and not to the Trustee for payment as general creditors and the Trustee
and the Paying Agent shall have no further liability with respect to such
monies.

 

12.  Discharge and Defeasance

 

Subject to
certain conditions, the Company at any time may terminate some of or all its obligations
under the Securities and the Indenture if the Company deposits with the Trustee
money or U.S. Government Obligations for the payment of principal of, and
interest and liquidated damages, if any, on, the Securities to redemption or
maturity, as the case may be.

 

13.  Amendment, Waiver

 

Subject to
certain exceptions set forth in the Indenture, (i) the Indenture, the
Securities, the Security Documents or the Intercreditor Agreement may be
amended without prior notice to any Holder but with the written consent of the
Holders of at least a majority in aggregate principal amount at maturity of the
outstanding Securities; provided that without the consent of the Holders
of at least 66b% in aggregate principal amount at maturity of the outstanding
Securities, no amendment or waiver may (x) release any Collateral from the Lien
of the Indenture and the Security Documents (except as permitted by the terms
of the Security Documents or the Intercreditor Agreement), (y) change the
provisions applicable to the application of the proceeds from the sale of
Collateral or (z) change or alter the priority of the security interests in the
Collateral and (ii) any default or compliance with any provisions of the
Indenture may be waived with the written consent of the Holders of at least a
majority in principal amount at maturity of the outstanding Securities.  Subject to certain exceptions set forth in
the Indenture, without the consent of any Holder, the Company, the Note
Guarantors and the Trustee may amend the Indenture or the Securities
(i) to cure any ambiguity, omission, defect or inconsistency; (ii) to
comply with Article 5 of the Indenture; (iii) to provide for
uncertificated Securities in addition to or in place of certificated
Securities; (iv) to add

 

11

 

Note Guarantees with respect to
the Securities or to secure further the Securities; (v) to add additional
covenants or to surrender rights and powers conferred on the Company;
(vi) to comply with the requirements of the SEC in order to effect or
maintain the qualification of the Indenture under the TIA;  (vii) to make any change that does not
materially and adversely affect the rights of any Holder under the provisions of
the Indenture; (viii) to provide for the issuance of the Additional
Securities, the Exchange Notes or Private Exchange Notes; and (ix) if
necessary, in connection with any addition or release of Collateral permitted
under the terms of the Indenture or the Security Documents.

 

14.  Defaults and Remedies

 

If an Event of
Default occurs (other than an Event of Default relating to certain events of
bankruptcy, insolvency or reorganization of the Company) and is continuing, the
Trustee or the Holders of at least 25% in principal amount at maturity of the outstanding
Securities may declare the principal of and accrued but unpaid interest on all
the Securities to be due and payable. 
If an Event of Default relating to certain events of bankruptcy,
insolvency or reorganization of the Company occurs, the principal of and
interest on all the Securities shall become immediately due and payable without
any declaration or other act on the part of the Trustee or any Holders and if
such Event of Default occurs prior to the earlier of (i) the Cash Election
Date and (ii) December 15, 2006, the Company will thereafter be
obligated to pay cash interest on each subsequent Interest Payment Date and the
Securities will cease to accrete.  Under
certain circumstances, the Holders of a majority in principal amount at
maturity of the outstanding Securities may rescind any such acceleration with
respect to the Securities and its consequences.

 

If an Event of
Default occurs and is continuing, the Trustee shall be under no obligation to
exercise any of the rights or powers under the Indenture at the request or
direction of any of the Holders unless such Holders have offered to the Trustee
reasonable indemnity or security against any loss, liability or expense and
certain other conditions are complied with. 
Except to enforce the right to receive payment of principal, premium (if
any) or interest when due, no Holder may pursue any remedy with respect to the
Indenture or the Securities unless (i) such Holder has previously given
the Trustee notice that an Event of Default is continuing, (ii) Holders of
at least 25% in principal amount at maturity of the outstanding Securities have
requested the Trustee in writing to pursue the remedy, (iii) such Holders
have offered the Trustee reasonable security or indemnity against any loss,
liability or expense, (iv) the Trustee has not complied with such request
within 60 days after the receipt of the request and the offer of security
or indemnity and (v) the Holders of a majority in principal amount at
maturity of the outstanding Securities have not given the Trustee a direction
inconsistent with such request within such 60-day period.  Subject to certain restrictions, the Holders
of a majority in principal amount at maturity of the outstanding Securities are
given the right to direct the time, method and place of conducting any
proceeding for any remedy available to the Trustee or of exercising any trust
or power conferred on the Trustee.  The
Trustee, however, may refuse to follow any direction that conflicts with law or
the Indenture or that the Trustee determines is unduly prejudicial to the
rights of any other

 

12

 

Holder or that would involve
the Trustee in personal liability. 
Prior to taking any action under the Indenture, the Trustee shall be entitled
to indemnification or security reasonably satisfactory to it against all losses
and expenses caused by taking or not taking such action.

 

15.  Trustee Dealings with the Company

 

Subject to
certain limitations imposed by the TIA, 
the Trustee under the Indenture, in its individual or any other
capacity, may become the owner or pledgee of Securities and may otherwise deal
with and collect obligations owed to it by the Company, a Note Guarantor or its
Affiliates and may otherwise deal with the Company, a Note Guarantor or its
Affiliates with the same rights it would have if it were not Trustee.

 

16.  No Recourse Against Others

 

A director,
officer, employee or stockholder, as such, of the Company or any Note Guarantor
shall not have any liability for any obligations of the Company under the
Securities or the Indenture or for any claim based on, in respect of or by
reason of such obligations or their creation. 
By accepting a Security, each Holder waives and releases all such
liability.  The waiver and release are
part of the consideration for the issue of the Securities.

 

17.  Authentication

 

This Security
shall not be valid until an authorized signatory of the Trustee (or an
authenticating agent) manually signs the certificate of authentication on the
other side of this Security.

 

18.  Abbreviations

 

Customary
abbreviations may be used in the name of a Holder or an assignee, such as TEN
COM (=tenants in common), TEN ENT (=tenants by the entireties), JT TEN (=joint
tenants with rights of survivorship and not as tenants in common), CUST
(=custodian), and U/G/M/A (=Uniform Gift to Minors Act).

 

19.  Governing Law

 

THIS SECURITY SHALL BE GOVERNED BY, AND
CONSTRUED IN ACCORDANCE WITH, THE LAWS OF THE STATE OF NEW YORK BUT
WITHOUT GIVING EFFECT TO APPLICABLE PRINCIPLES OF CONFLICTS OF LAW TO THE
EXTENT THAT THE APPLICATION OF THE LAWS OF ANOTHER JURISDICTION WOULD BE
REQUIRED THEREBY.

 

20.  CUSIP and ISIN Numbers

 

The Company
has caused CUSIP and ISIN numbers to be printed on the Securities and has
directed the Trustee to use CUSIP and ISIN numbers in notices of redemption as
a convenience to Holders.  No
representation is made as to the accuracy of

 

13

 

such numbers either as printed
on the Securities or as contained in any notice of redemption and reliance may
be placed only on the other identification numbers placed thereon.

 

21.  Designated Senior Indebtedness

 

For purposes
of the Senior Subordinated Notes Indentures, the Securities and the Note
Guarantees shall constitute Designated Senior Indebtedness (as such term is
defined in the Senior Subordinated Notes Indentures) of the Company and the
Note Guarantors, as the case may be.

 

The Company will furnish to any Holder of
Securities upon written request and without charge to the Holder a copy of the
Indenture which has in it the text of this Security.

 

14

 

ASSIGNMENT FORM

 

	
  To assign this Security, fill in the form below:

  	
   

  	 

	
  I or we assign and transfer this Security to

  	
   

  	 

	
   

  	
   

  	 

	
   

  	 

	
  (Print or type assignee’s name, address and zip code)

  	 

	
   

  	
   

  	 

	
   

  	 

	
  (Insert assignee’s soc. sec. or tax I.D. No.)

  	 

	
   

  	
   

  	 

	
  and irrevocably
  appoint                           agent
  to transfer this Security on the books of the Company.  The agent may substitute another to act
  for him.

  	 

	
   

  	
   

  	 

	
  Date:

  	
   

  	
  Your Signature:

  	
   

  	
   

  	
   

  	 

	
   

  	
   

  	 

	
   

  	 

	
  Sign exactly as your name appears on the other side of this Security.

  	
   

  	 

	
  Signature Guarantee:

  	
   

  	 

	
   

  	
   

  	 

	
  Date:

  	
   

  	
   

  	
   

  	
   

  	 

	
  Signature must be guaranteed

  by a participant in a

  recognized signature guaranty

  medallion program or other

  signature guarantor acceptable

  to the Trustee

  	
   

  	
  Signature of Signature Guarantee

  
												

 

15

 

CERTIFICATE TO BE DELIVERED UPON EXCHANGE OR
REGISTRATION OF TRANSFER RESTRICTED SECURITIES

 

This certificate relates to
$               
principal amount at maturity of Securities held in (check applicable space)
            book-entry
or
              
definitive form by the undersigned.

 

The undersigned (check one box below):

 

o                                    has
requested the Trustee by written order to deliver in exchange for its
beneficial interest in the Global Security held by the Depositary a Security or
Securities in definitive, registered form of authorized denominations and an
aggregate principal amount at maturity equal to its beneficial interest in such
Global Security (or the portion thereof indicated above);

 

o                                    has
requested the Trustee by written order to exchange or register the transfer of
a Security or Securities.

 

In connection
with any transfer of any of the Securities evidenced by this certificate, the
undersigned confirms that such Securities are being transferred in accordance
with its terms:

 

CHECK ONE BOX
BELOW

 

(1)                                  o                                    to
the Company; or

 

(2)                                  o                                    to the Registrar
for registration in the name of the Holder, without transfer; or

 

(3)                                  o                                    pursuant to an
effective registration statement under the Securities Act of 1933; or

 

(4)                                  o                                    inside the
United States to a “qualified institutional buyer” (as defined in
Rule 144A under the Securities Act of 1933) that purchases for its own
account or for the account of a qualified institutional buyer to whom notice is
given that such transfer is being made in reliance on Rule 144A, in each case
pursuant to and in compliance with Rule 144A under the Securities Act of
1933; or

 

(5)                                  o                                    outside the United
States in an offshore transaction within the meaning of Regulation S under the
Securities Act of 1933 in compliance with Rule 904 under the Securities Act of
1933 and such security shall be held immediately after the transfer through
Euroclear or Clearstream until the expiration of the Restricted Period (as
defined in the Indenture); or

 

(6)                                  o                                    to an institutional
“accredited investor” (as defined in Rule 501(a)(1), (2), (3) or (7) under the
Securities Act of 1933) that has furnished to the Trustee a signed letter
containing certain representations and agreements; or

 

16

 

(7)                                  o                                    pursuant to another
available exemption from registration provided by Rule 144 under the Securities
Act of 1933.

 

Unless one of
the boxes is checked, the Trustee will refuse to register any of the Securities
evidenced by this certificate in the name of any Person other than the
registered Holder thereof; provided, however, that if
box (5) or (6) is checked, the Trustee may require, prior to registering
any such transfer of the Securities, such legal opinions, certifications and
other information required by the Indenture to confirm that such transfer is
being made pursuant to an exemption from, or in a transaction not subject to,
the registration requirements of the Securities Act of 1933.

 

	
   

  	
   

  	
   

  	 

	
   

  	
  Your Signature

  	 

	
   

  	
   

  	 

	
  Signature Guarantee:

  	
   

  	 

	
   

  	
   

  	 

	
  Date:

  	
   

  	
   

  	
   

  	
   

  	 

	
  Signature must be guaranteed

  by a participant in a

  recognized signature guaranty

  medallion program or other

  signature guarantor acceptable

  to the Trustee

  	
   

  	
  Signature of Signature Guarantee

  
									

 

17

 

TO BE COMPLETED BY PURCHASER IF (4) ABOVE IS
CHECKED.

 

The
undersigned represents and warrants that it is purchasing this Security for its
own account or an account with respect to which it exercises sole investment
discretion and that it and any such account is a “qualified institutional
buyer” within the meaning of Rule 144A under the Securities Act of 1933,
and is aware that the sale to it is being made in reliance on Rule 144A
and acknowledges that it has received such information regarding the Company as
the undersigned has requested pursuant to Rule 144A or has determined not
to request such information and that it is aware that the transferor is relying
upon the undersigned’s foregoing representations in order to claim the
exemption from registration provided by Rule 144A.

 

	
  Dated:

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
  NOTICE:  To be executed by

  
	
   

  	
  an executive
  officer

  

 

18

 

[TO BE ATTACHED TO
GLOBAL SECURITIES]

SCHEDULE OF INCREASES OR DECREASES IN GLOBAL SECURITY

 

The initial
principal amount at maturity of this Global Security is
$[        ].  The following increases or decreases in this Global Security have
been made:

 

 

	
  Date of

  Exchange

  	
   

  	
  Amount of
  decrease in

  principal amount at

  maturity of this Global

  Security

  	
   

  	
  Amount of
  increase in

  principal amount at maturity

  of this Global Security

  	
   

  	
  Principal
  amount at maturity

  of this Global Security

  following such decrease or

  increase

  	
   

  	
  Signature
  of authorized 

  signatory of Trustee or

  Securities Custodian

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  

 

19

 

OPTION OF HOLDER TO ELECT PURCHASE

 

If you want to elect to have this Security
purchased by the Company pursuant to Section 4.06 (Asset Disposition) or
4.08 (Change of Control) of the Indenture, check the box:

 

Asset Disposition  o  Change of Control  o

 

If you want to elect to have only part of
this Security purchased by the Company pursuant to Section 4.06 or
4.08 of the Indenture, state the amount ($1,000 principal amount at
maturity or an integral multiple thereof):

 

	
  $

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
  Date:

  	
   

  	
   

  	
  Your
  Signature:

  	
   

  	
   

  
	
  (Sign
  exactly as your name appears on the other side of the Security)

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
  Signature
  Guarantee:

  	
   

  	
   

  
	
   

  	
  Signature
  must be guaranteed by a participant in a recognized signature guaranty
  medallion program or other signature guarantor acceptable to the Trustee

  
									

 

20

 

EXHIBIT B

 

[FORM OF FACE OF EXCHANGE NOTE]

[Global Securities Legend]

 

UNLESS THIS
CERTIFICATE IS PRESENTED BY AN AUTHORIZED REPRESENTATIVE OF THE DEPOSITORY
TRUST COMPANY, A NEW YORK CORPORATION (“DTC”), NEW YORK,
NEW YORK, TO THE COMPANY OR ITS AGENT FOR REGISTRATION OF TRANSFER, EXCHANGE
OR PAYMENT, AND ANY CERTIFICATE ISSUED IS REGISTERED IN THE NAME OF
CEDE & CO. OR SUCH OTHER NAME AS IS REQUESTED BY AN AUTHORIZED
REPRESENTATIVE OF DTC (AND ANY PAYMENT IS MADE TO CEDE & CO., OR TO
SUCH OTHER ENTITY AS IS 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.

 

TRANSFERS OF
THIS GLOBAL SECURITY SHALL BE LIMITED TO TRANSFERS IN WHOLE, BUT NOT IN PART,
TO DTC, TO NOMINEES OF DTC OR TO A SUCCESSOR THEREOF OR SUCH SUCCESSOR’S
NOMINEE AND TRANSFERS OF PORTIONS OF THIS GLOBAL SECURITY SHALL BE LIMITED TO
TRANSFERS MADE IN ACCORDANCE WITH THE RESTRICTIONS SET FORTH IN THE INDENTURE
REFERRED TO ON THE REVERSE HEREOF.

 

 

	
  No.

  	
  $

  	
   

  
	
   

  
	
   

  
	
  111/8% Senior Secured
  Discount Note due 2009

  
	
   

  
	
   

  	
  CUSIP No.

  	
   

  
	
   

  	
  ISIN No.

  	
   

  

 

PLIANT
CORPORATION, a Utah corporation, promises to pay to Cede & Co., or
registered assigns, the principal amount at maturity [listed on the Schedule of
Increases or Decreases in Global Security attached hereto](3) [of
$            ](4)
on June 15, 2009.

 

Interest
Payment Dates:  June 15 and
December 15.

 

Record
Dates:   June 1 and
December 1.

 

(3) Insert if
Security is to be issued in global form.

 

(4) Insert if
Security is to be issued in definitive form.

 

2

 

Additional
provisions of this Security are set forth on the other side of this Security.

 

IN WITNESS
WHEREOF, the parties have caused this instrument to be duly executed.

 

	
   

  	
  PLIANT CORPORATION,

  
	
   

  	
   

  
	
   

  	
  by

  	
   

  
	
   

  	
   

  	
  Name:

  
	
   

  	
   

  	
  Title:

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  by

  	
   

  
	
   

  	
   

  	
  Name:

  
	
   

  	
   

  	
  Title:

  

 

 

	
  Dated:

  	
   

  
	
   

  	
   

  
	
  TRUSTEE’S
  CERTIFICATE OF

  AUTHENTICATION

  	
   

  
	
   

  	
   

  
	
  WILMINGTON TRUST COMPANY,

  	
   

  
	
   

  	
   

  
	
  as Trustee, certifies that this is one of

  the Securities referred to in the Indenture.

  	
   

  
	
   

  	
   

  
	
  by

  	
   

  	
   

  	
   

  
	
   

  	
  Authorized
  Signatory

  	
   

  	
   

  

 

*/ If the Security
is to be issued in global form, add the Global Securities Legend and the
attachment from Exhibit A captioned “TO BE ATTACHED TO GLOBAL SECURITIES -
SCHEDULE OF INCREASES OR DECREASES IN GLOBAL SECURITY”.

 

3

 

[FORM OF REVERSE SIDE OF EXCHANGE NOTE]

 

111/8%
Senior Discount Secured Note due 2009

 

1.  Accreted Value; Interest

 

PLIANT
CORPORATION, a Utah corporation (such corporation, and its successors and
assigns under the Indenture hereinafter referred to, being herein called the
“Company”), promises to pay interest on the principal amount at maturity of
this Security at the rate per annum shown above.

 

Unless the
Company elects to pay cash interest as described below, no cash interest will
accrue on the Securities prior to December 15, 2006.  The Accreted Value of each Security will
increase from the date of issuance until December 15, 2006, at a rate of
111⁄8% per annum, compounded semiannually on each June 15 and
December 15 commencing June 15, 2004, reflecting the accrual of
non-cash interest, such that the Accreted Value will equal the stated principal
amount at maturity on December 15, 2006. 
Cash interest on the Securities will accrue at the rate of 111⁄8%
per annum from December 15, 2006, or from the most recent date to which
interest has been paid or provided for, and will be payable in cash
semiannually on June 15 and December 15 of each year (each an
“Interest Payment Date”), commencing on June 15, 2007, to holders of
record on the immediately preceding June 1 and December 1,
respectively.  Notwithstanding the
foregoing, on any Interest Payment Date prior to December 15, 2006, the
Company may elect to commence to pay cash interest (from and after such
Interest Payment Date), in which case (i) the Company will be obligated to
pay cash interest on each subsequent Interest Payment Date, (ii) the
Securities will cease to accrete after such Interest Payment Date and
(iii) the outstanding principal amount at Stated Maturity of each Security
will be equal to the Accreted Value of such Security as of such Interest
Payment Date. Interest and Accreted Value will be computed on the basis of a
360-day year comprised of twelve 30-day months. The Company shall pay interest
on overdue principal at the rate borne by the Securities, and it shall pay
interest on overdue installments of interest at the same rate to the extent
lawful.  Interest will be payable as described
in the foregoing paragraph, except as described under paragraph 14 of this
Security.

 

“Accreted
Value” as of any date (the “Specified Date”) means, with respect to each $1,000
principal amount at maturity of the Securities (subject to the latest sentence
of this definition):

 

(i) if the
Specified Date is one of the following dates (each a “Semi-Annual Accretion
Date”), the amount set forth opposite each date below:

 

4

 

	
  Semi-Annual Accretion Date

  	
   

  	
  Accreted
  Value

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  Issue Date

  	
   

  	
  $

  	
  736.27

  	
   

  
	
  June 15, 2004

  	
   

  	
  $

  	
  762.87

  	
   

  
	
  December 15, 2004

  	
   

  	
  $

  	
  805.31

  	
   

  
	
  June 15, 2005

  	
   

  	
  $

  	
  850.10

  	
   

  
	
  December 15, 2005

  	
   

  	
  $

  	
  897.39

  	
   

  
	
  June 15, 2006

  	
   

  	
  $

  	
  947.31

  	
   

  
	
  December 15, 2006

  	
   

  	
  $

  	
  1,000.00

  	
   

  

 

(ii) if the
Specified Date occurs between two Semi-Annual Accretion Dates, the sum of (a)
the Accreted Value for the Semi-Annual Accretion Date immediately preceding the
Specified Date and (b) an amount equal to the product of (x) the Accreted
Value for the immediately following Semi-Annual Accretion Date less the
Accreted Value of the immediately preceding Semi-Annual Accretion Date and
(y) the fraction, the numerator of which is the number of days actually
elapsed from the immediately preceding Semi-Annual Accretion Date and the denominator
of which is 180; or

 

(iii) if the
Specified Date is after December 15, 2006, $1,000.

 

For the
purposes hereof, if the Specified Date is prior to December 15, 2006 but
on or after the date on which the Company elects to commence to pay cash
interest (the “Cash Election Date”), all references in this document to
Accreted Value in respect of any Security shall be to the aggregate principal
amount of such Security, which shall be equal to the Accreted Value of the such
Security as of the Cash Election Date determined in accordance with clauses (i)
and (ii) above.

 

2.  Method of Payment

 

The Company
shall pay interest on the Securities (except defaulted interest) to the Persons
who are registered Holders at the close of business on the June 1 and
December 1 next preceding the Interest Payment Date even if Securities are
canceled after the record date and on or before the Interest Payment Date.  Holders must surrender Securities to a
Paying Agent to collect principal payments. 
The Company shall pay principal, premium, if any, and interest in money
of the United States of America that at the time of payment is legal
tender for payment of public and private debts.  Payments in respect of the Securities represented by a Global
Security (including principal, premium and interest) shall be made by wire
transfer of immediately available funds to the accounts specified by The
Depository Trust Company or any successor depositary.  The Company will make all payments in respect of a certificated
Security (including principal, premium, if any, and interest), at the office of
the Paying Agent, except that, at the option of the Company, payment of
interest may be made by mailing a check to the registered address of each
Holder thereof; provided, however, that payments on the Securities
may also be made, in the case of a Holder of at least $1,000,000 aggregate
principal amount at maturity of Securities, by wire transfer to a
U.S. dollar account maintained by the payee with a bank in the
United States if such Holder elects payment

 

5

 

by wire transfer by giving
written notice to the Trustee or the Paying Agent to such effect designating
such account no later than 30 days immediately preceding the relevant due
date for payment (or such other date as the Trustee may accept in its
discretion).

 

3.  Paying Agent and Registrar

 

Initially,
WILMINGTON TRUST COMPANY , a Delaware banking corporation (the “Trustee”), will
act as Paying Agent and Registrar.  The
Company may appoint and change any Paying Agent or Registrar without
notice.  The Company or any of its
domestically incorporated Wholly Owned Subsidiaries may act as Paying Agent or
Registrar.

 

4.  Indenture

 

The Company
issued the Securities under an Indenture dated as of February 17, 2004
(the “Indenture”), among the Company, the Note Guarantors and the Trustee.  The terms of the Securities include those
stated in the Indenture and those made part of the Indenture by reference to
the Trust Indenture Act of 1939 (15 U.S.C. §§ 77aaa-77bbbb) as in
effect on the date of the Indenture (the “TIA”).  Terms defined in the Indenture and not defined herein have the
meanings ascribed thereto in the Indenture. 
The Securities are subject to all terms and provisions of the Indenture,
and Holders (as defined in the Indenture) are referred to the Indenture and the
TIA for a statement of such terms and provisions.

 

The Securities
are senior secured obligations of the Company. 
The Company shall be entitled, subject to its compliance with Section
4.03 of the Indenture, to issue Additional Securities pursuant to Section 2.01
of the Indenture.  This Security is one
of the Exchange Notes referred to in the Indenture.  The Securities include the Original Securities, the Additional
Securities and any Exchange Notes and Private Exchange Notes issued in exchange
for the Initial Securities pursuant to the Indenture.  The Original Securities, the Additional Securities, the Exchange
Notes and the Private Exchange Notes are treated as a single class of
securities under the Indenture.  The
Indenture imposes certain limitations on the ability of the Company and its
Restricted Subsidiaries to, among other things, make certain Investments and
other Restricted Payments, pay dividends and other distributions, incur
Indebtedness, enter into consensual restrictions upon the payment of certain
dividends and distributions by such Restricted Subsidiaries, enter into or
permit certain transactions with Affiliates, make asset sales and incur
Liens.  The Indenture also imposes
limitations on the ability of the Company and each Note Guarantor to
consolidate or merge with or into any other Person or the Company to convey,
transfer or lease all or substantially all of its property.

 

To guarantee
the due and punctual payment of the principal and interest, if any, on the
Securities and all other amounts payable by the Company under the Indenture and
the Securities when and as the same shall be due and payable, whether at
maturity, by acceleration or otherwise, according to the terms of the Securities
and the Indenture, the Note Guarantors have, jointly and severally,
unconditionally guaranteed the Guaranteed Obligations on a senior secured basis
pursuant to the terms of the Indenture.

 

6

 

The Securities
are secured (i) on a first-priority basis with respect to the
First-Priority Collateral and (ii) on a second-priority basis with respect
to the Second-Priority Collateral, in each case, by the Liens created by the
Security Documents pursuant to, and subject to, the terms of the Indenture and
the Intercreditor Agreement.

 

5.  Optional Redemption

 

Except as set
forth in the following paragraph, the Securities shall not be redeemable at the
option of the Company prior to June 15, 2007. 
On or after June 15, 2007, the Securities shall be redeemable at the
option of the Company, in whole or in part, on not less than 30 nor more than
60 days prior notice, at the following redemption prices (expressed as
percentages of principal amount), plus accrued and unpaid interest and
liquidated damages, if any, to the redemption date (subject to the right of
Holders of record on the relevant record date to receive interest due on the
relevant Interest Payment Date), if redeemed during the 12-month period
commencing on June 15 of the years set forth below (or, in the case of
June 15, 2009, on such date):

 

 

	
  Year

  	
   

  	
  Redemption
  

  Price

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  2007

  	
   

  	
  105.563

  	
  %

  
	
  2008

  	
   

  	
  102.781

  	
  %

  
	
  2009

  	
   

  	
  100.000

  	
  %

  

 

In addition,
prior to June 15, 2007, the Company may redeem up to a maximum of 35% of the
Accreted Value of the Securities (calculated after giving effect to any
issuance of Additional Securities) with the Net Cash Proceeds of one or more
Equity Offerings by the Company at a redemption price equal to 111.125% of the
Accreted Value at the date of redemption, plus accrued and unpaid interest and
liquidated damages thereon, if any, to the date of redemption; provided,
however, that after giving effect to any such redemption, at least 65%
of the Accreted Value of the Securities (calculated after giving effect to any
issuance of Additional Securities) remains outstanding, and any such redemption
shall be made within 120 days of such Equity Offering upon not less than
30 nor more than 60 days notice mailed to each Holder of Securities
being redeemed and otherwise in accordance with the procedures set forth in the
Indenture.

 

6.  Sinking Fund

 

The Securities
are not subject to any sinking fund.

 

7.  Notice of Redemption

 

Notice of
redemption will be mailed by first-class mail at least 30 days but not
more than 60 days before the redemption date to each Holder of Securities
to be

 

7

 

redeemed at his or her
registered address.  Securities in
denominations larger than $1,000 principal amount at maturity may be redeemed
in part but only in whole multiples of $1,000 principal amount at
maturity.  If money sufficient to pay
the redemption price of and accrued and unpaid interest and liquidated damages,
if any, on all Securities (or portions thereof) to be redeemed on the
redemption date is deposited with the Paying Agent on or before the redemption
date and certain other conditions are satisfied, on and after such date
interest ceases to accrue on such Securities (or such portions thereof) called
for redemption.

 

8.  Repurchase of Securities at the Option of
Holders upon Change of Control

 

Upon a Change
of Control, any Holder of Securities will have the right, subject to certain
conditions specified in the Indenture, to cause the Company to repurchase all
or any part of the Securities of such Holder at a purchase price equal to 101%
of the Accreted Value or principal amount of the Securities to be repurchased
plus accrued and unpaid interest and liquidated damages, if any, to the date of
repurchase (subject to the right of Holders of record on the relevant record
date to receive interest due on the relevant Interest Payment Date that is on
or prior to the date of purchase) as provided in, and subject to the terms of,
the Indenture.

 

In accordance
with Section 4.06 of the Indenture, the Company will be required to offer
to purchase Securities upon the occurrence of certain events.

 

9.  Denominations; Transfer; Exchange

 

The Securities
are in registered form without coupons in denominations of $1,000 principal
amount at maturity and whole multiples of $1,000 principal amount at
maturity.  A Holder may transfer or
exchange Securities in accordance with the Indenture.  Upon any transfer or exchange, the Registrar and the Trustee may
require a Holder, among other things, to furnish appropriate endorsements or
transfer documents and to pay any taxes required by law or permitted by the
Indenture.  The Registrar need not
register the transfer of or exchange any Securities selected for redemption
(except, in the case of a Security to be redeemed in part, the portion of the
Security not to be redeemed) or to transfer or exchange any Securities for a
period of 15 days prior to a selection of Securities to be redeemed.

 

10.  Persons Deemed Owners

 

Except as
provided in paragraph 2 hereof, the registered Holder of this Security may be
treated as the owner of it for all purposes.

 

11.  Unclaimed Money

 

If money for
the payment of principal or interest remains unclaimed for two years, the
Trustee and the Paying Agent shall pay the money back to the Company at its
written request unless an abandoned property law designates another
Person.  After any such payment, Holders
entitled to the money must look only to the Company for

 

8

 

payment and not to the Trustee
for payment as general creditors and the Trustee and the Paying Agent shall
have no further liability with respect to such monies.

 

12.  Discharge and Defeasance

 

Subject to
certain conditions, the Company at any time may terminate some of or all its
obligations under the Securities and the Indenture if the Company deposits with
the Trustee money or U.S. Government Obligations for the payment of principal
and interest on the Securities to redemption or maturity, as the case may be.

 

13.  Amendment, Waiver

 

Subject to
certain exceptions set forth in the Indenture, (i) the Indenture, the
Securities, the Security Documents or the Intercreditor Agreement may be
amended without prior notice to any Holder but with the written consent of the
Holders of at least a majority in aggregate principal amount at maturity of the
outstanding Securities; provided that without the consent of the Holders
of at least 66b% in aggregate principal amount at maturity of the outstanding
Securities, no amendment or waiver may (x) release any Collateral from the Lien
of the Indenture and the Security Documents (except as permitted by the terms
of the Security Documents or the Intercreditor Agreement), (y) change the
provisions applicable to the application of the proceeds from the sale of
Collateral or (z) change or alter the priority of the security interests in the
Collateral and (ii) any default or compliance with any provisions of the
Indenture may be waived with the written consent of the Holders of at least a
majority in principal amount at maturity of the outstanding Securities.  Subject to certain exceptions set forth in
the Indenture, without the consent of any Holder, the Company, the Note
Guarantors and the Trustee may amend the Indenture or the Securities
(i) to cure any ambiguity, omission, defect or inconsistency; (ii) to
comply with Article 5 of the Indenture; (iii) to provide for
uncertificated Securities in addition to or in place of certificated
Securities; (iv) to add Note Guarantees with respect to the Securities or
to secure further the Securities; (v) to add additional covenants or to
surrender rights and powers conferred on the Company; (vi) to comply with
the requirements of the SEC in order to effect or maintain the qualification of
the Indenture under the TIA; 
(vii) to make any change that does not materially and adversely
affect the rights of any Holder under the provisions of the Indenture;
(viii) to provide for the issuance of the Additional Securities, the
Exchange Notes or Private Exchange Notes; and (ix) if necessary, in connection
with any addition or release of Collateral permitted under the terms of the
Indenture or the Security Documents.

 

14.  Defaults and Remedies

 

If an Event of
Default occurs (other than an Event of Default relating to certain events of
bankruptcy, insolvency or reorganization of the Company) and is continuing, the
Trustee or the Holders of at least 25% in principal amount at maturity of the
outstanding Securities may declare the principal of and accrued but unpaid
interest on all the Securities to be due and payable.  If an Event of Default relating to certain events of bankruptcy,
insolvency or reorganization of the Company occurs, the principal of and

 

9

 

interest on all the Securities
shall become immediately due and payable without any declaration or other act
on the part of the Trustee or any Holders and if such Event of Default occurs
prior to the earlier of (i) the Cash Election Date and (ii) December 15,
2006, the Company will thereafter be obligated to pay cash interest on each
subsequent Interest Payment Date and the Securities will cease to accrete.  Under certain circumstances, the Holders of
a majority in principal amount at maturity of the outstanding Securities may
rescind any such acceleration with respect to the Securities and its
consequences.

 

If an Event of
Default occurs and is continuing, the Trustee shall be under no obligation to
exercise any of the rights or powers under the Indenture at the request or
direction of any of the Holders unless such Holders have offered to the Trustee
reasonable indemnity or security against any loss, liability or expense and
certain other conditions are complied with. 
Except to enforce the right to receive payment of principal, premium (if
any) or interest when due, no Holder may pursue any remedy with respect to the
Indenture or the Securities unless (i) such Holder has previously given
the Trustee notice that an Event of Default is continuing, (ii) Holders of
at least 25% in principal amount at maturity of the outstanding Securities have
requested the Trustee in writing to pursue the remedy, (iii) such Holders
have offered the Trustee reasonable security or indemnity against any loss,
liability or expense, (iv) the Trustee has not complied with such request
within 60 days after the receipt of the request and the offer of security
or indemnity and (v) the Holders of a majority in principal amount at
maturity of the outstanding Securities have not given the Trustee a direction
inconsistent with such request within such 60-day period.  Subject to certain restrictions, the Holders
of a majority in principal amount at maturity of the outstanding Securities are
given the right to direct the time, method and place of conducting any
proceeding for any remedy available to the Trustee or of exercising any trust
or power conferred on the Trustee.  The
Trustee, however, may refuse to follow any direction that conflicts with law or
the Indenture or that the Trustee determines is unduly prejudicial to the
rights of any other Holder or that would involve the Trustee in personal
liability.  Prior to taking any action
under the Indenture, the Trustee shall be entitled to indemnification or
security reasonably satisfactory to it against all losses and expenses caused
by taking or not taking such action.

 

15.  Trustee Dealings with the Company

 

Subject to
certain limitations imposed by the TIA, 
the Trustee under the Indenture, in its individual or any other
capacity, may become the owner or pledgee of Securities and may otherwise deal
with and collect obligations owed to it by the Company, a Note Guarantor or its
Affiliates and may otherwise deal with the Company, a Note Guarantor or its
Affiliates with the same rights it would have if it were not Trustee.

 

16.  No Recourse Against Others

 

A director,
officer, employee or stockholder, as such, of the Company or any Note Guarantor
shall not have any liability for any obligations of the Company under the
Securities or the Indenture or for any claim based on, in respect of or by
reason of

 

10

 

such obligations or their
creation.  By accepting a Security, each
Holder waives and releases all such liability. 
The waiver and release are part of the consideration for the issue of
the Securities.

 

17.  Authentication

 

This Security
shall not be valid until an authorized signatory of the Trustee (or an
authenticating agent) manually signs the certificate of authentication on the
other side of this Security.

 

18.  Abbreviations

 

Customary
abbreviations may be used in the name of a Holder or an assignee, such as TEN
COM (=tenants in common), TEN ENT (=tenants by the entireties), JT TEN (=joint
tenants with rights of survivorship and not as tenants in common), CUST
(=custodian), and U/G/M/A (=Uniform Gift to Minors Act).

 

19.  Governing Law

 

THIS SECURITY SHALL BE GOVERNED BY, AND
CONSTRUED IN ACCORDANCE WITH, THE LAWS OF THE STATE OF NEW YORK BUT
WITHOUT GIVING EFFECT TO APPLICABLE PRINCIPLES OF CONFLICTS OF LAW TO THE
EXTENT THAT THE APPLICATION OF THE LAWS OF ANOTHER JURISDICTION WOULD BE
REQUIRED THEREBY.

 

20.  CUSIP and ISIN Numbers

 

The Company
has caused CUSIP and ISIN numbers to be printed on the Securities and has
directed the Trustee to use CUSIP and ISIN numbers in notices of redemption as
a convenience to Holders.  No
representation is made as to the accuracy of such numbers either as printed on
the Securities or as contained in any notice of redemption and reliance may be
placed only on the other identification numbers placed thereon.

 

21.  Designated Senior Indebtedness

 

For purposes
of the Senior Subordinated Notes Indentures, the Securities and the Note
Guarantees shall constitute Designated Senior Indebtedness (as such term is
defined in the Senior Subordinated Notes Indentures) of the Company and the
Note Guarantors, as the case may be.

 

The Company will furnish to any Holder of
Securities upon written request and without charge to the Holder a copy of the
Indenture which has in it the text of this Security.

 

11

 

ASSIGNMENT FORM

 

	
  To assign this Security, fill in the form below:

  	
   

  	 

	
  I or we assign and transfer this Security to

  	
   

  	 

	
   

  	
   

  	 

	
   

  	 

	
  (Print or type assignee’s name, address and
  zip code)

  	 

	
   

  	 

	
   

  	 

	
  (Insert assignee’s soc. sec. or tax I.D.
  No.)

  	 

	
   

  	
   

  	 

	
   

  	
   

  	 

	
  and irrevocably
  appoint                           agent
  to transfer this Security on the books of the Company.  The agent may substitute another to act
  for him.

  	 

	
   

  	 

	
   

  	 

	
  Date:

  	
   

  	
  Your Signature:

  	
   

  	
   

  	
   

  	 

	
   

  	
   

  	 

	
   

  	 

	
  Sign exactly as your name appears on the other side of this Security.

  	
   

  	 

	
  Signature Guarantee:

  	
   

  	 

	
   

  	
   

  	 

	
  Date:

  	
   

  	
   

  	
   

  	
   

  	 

	
  Signature must be guaranteed

  by a participant in a

  recognized signature guaranty

  medallion program or other

  signature guarantor acceptable

  to the Trustee

  	
   

  	
  Signature of Signature Guarantee

  
												

 

12

 

OPTION OF HOLDER TO ELECT PURCHASE

 

If you want to elect to have this Security
purchased by the Company pursuant to Section 4.06 (Asset Disposition) or
4.08 (Change of Control) of the Indenture, check the box:

 

Asset Disposition  o  Change of Control  o

 

If you want to elect to have only part of
this Security purchased by the Company pursuant to Section 4.06 or
4.08 of the Indenture, state the amount ($1,000 principal amount at
maturity or an integral multiple thereof):

 

	
  $

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
  Date:

  	
   

  	
   

  	
  Your
  Signature:

  	
   

  	
   

  
	
  (Sign
  exactly as your name appears on the other side of the Security)

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
  Signature
  Guarantee:

  	
   

  	
   

  
	
   

  	
  Signature
  must be guaranteed by a participant in a recognized signature guaranty
  medallion program or other signature guarantor acceptable to the Trustee

  
									

 

13

 

[TO BE ATTACHED TO GLOBAL SECURITIES]

 

SCHEDULE OF INCREASES OR
DECREASES IN GLOBAL SECURITY

 

The initial
principal amount at maturity of this Global Security is
$[        ].  The following increases or decreases in this Global Security have
been made:

 

	
  Date of

  Exchange

  	
   

  	
  Amount of
  decrease in

  principal amount at maturity

  of this Global Security

  	
   

  	
  Amount of
  increase in

  principal amount at maturity

  of this Global Security

  	
   

  	
  Principal
  amount at maturity

  of this Global Security

  following such decrease or

  increase

  	
   

  	
  Signature
  of authorized

  signatory of Trustee or

  Securities Custodian

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  

 

14

 

EXHIBIT C

 

FORM OF SUPPLEMENTAL INDENTURE

 

SUPPLEMENTAL INDENTURE (this
“Supplemental Indenture”) dated as of
            , among
[GUARANTOR] (the “New Guarantor”), a subsidiary of PLIANT CORPORATION (or its
successor), a Utah corporation (the “Company”), [OTHER EXISTING GUARANTORS] and
WILMINGTON TRUST COMPANY, a Delaware banking corporation, as trustee under the
indenture referred to below (the “Trustee”).

 

W I T N E S S E T H :

 

WHEREAS the
Company and [OLD GUARANTORS] (the “Existing Guarantors”) has heretofore
executed and delivered to the Trustee an Indenture (the “Indenture”) dated as
of February 17, 2004, providing for the issuance initially of an aggregate
principal amount at maturity of $306,000,000 111/8%
Senior Secured Discount Notes due 2009 (the “Securities”);

 

WHEREAS
Section 4.11 of the Indenture provides that under certain circumstances
the Company is required to cause the New Guarantor to execute and deliver to
the Trustee a supplemental indenture pursuant to which the New Guarantor shall
unconditionally guarantee all the Company’s obligations under the Securities
pursuant to a Note Guarantee on the terms and conditions set forth herein; and

 

WHEREAS
pursuant to Section 9.01 of the Indenture, the Trustee, the Company and
the Existing Guarantors are 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 New Guarantor,
the Company, the Existing Guarantors and the Trustee mutually covenant and
agree for the equal and ratable benefit of the holders of the Securities as
follows:

 

1.  Agreement to Guarantee.  The New Guarantor hereby agrees, jointly and
severally with all the Existing Guarantors, to unconditionally guarantee the
Company’s obligations under the Securities on the terms and subject to the
conditions set forth in Article 11 the Indenture and to be bound by all
other applicable provisions of the Indenture and the Securities.

 

2.  Ratification
of Indenture; Supplemental Indentures Part of Indenture.  Except
as expressly amended hereby, the Indenture is in all respects ratified and
confirmed and all the terms, conditions and provisions thereof shall remain in
full force and effect.  This
Supplemental Indenture shall form a part of the Indenture for all

 

 

purposes, and every holder of
Securities heretofore or hereafter authenticated and delivered shall be bound
hereby.

 

3.  Governing Law.  THIS
SUPPLEMENTAL INDENTURE SHALL BE GOVERNED BY, AND CONSTRUED IN ACCORDANCE WITH,
THE LAWS OF THE STATE OF NEW YORK BUT WITHOUT GIVING EFFECT TO APPLICABLE
PRINCIPLES OF CONFLICTS OF LAW TO THE EXTENT THAT THE APPLICATION OF THE LAWS
OF ANOTHER JURISDICTION WOULD BE REQUIRED THEREBY.

 

4.  Trustee Makes No Representation.  The recitals contained herein shall be taken
as the statements of the Company, [NEW GUARANTOR] and the Existing Guarantors,
and the Trustee assumes no responsibility for their correctness.  The Trustee makes no representation as to
the validity or sufficiency of this Supplemental Indenture.

 

5.  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.

 

6.  Effect of Headings.  The Section headings herein are for
convenience only and shall not effect the construction thereof.

 

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

 

	
   

  	
  [NEW
  GUARANTOR],

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  by

  	
   

  
	
   

  	
   

  	
  Name:

  	
   

  
	
   

  	
   

  	
  Title:

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  PLIANT
  CORPORATION,

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  by

  	
   

  
	
   

  	
   

  	
  Name:

  	
   

  
	
   

  	
   

  	
  Title:

  	
   

  

 

2

 

	
   

  	
   

  	
  [OTHER
  EXISTING GUARANTORS],

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  by

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
  Name:

  
	
   

  	
   

  	
   

  	
  Title:

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  WILMINGTON
  TRUST COMPANY, as

  Trustee,

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  by

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
  Name:

  
	
   

  	
   

  	
   

  	
  Title:

  

 

3

 

EXHIBIT D

 

Form of

Transferee Letter of Representation

 

Pliant Corporation

1515 Woodfield Road, Suite 600

Schaumburg, Illinois 60173

 

 

Ladies and
Gentlemen:

 

This
certificate is delivered to request a transfer of
$                          principal
amount at maturity of the 111⁄8% Senior Secured Discount Notes due 2009
(the “Notes”) of Pliant Corporation (the “Issuer”).

 

Upon transfer,
the Notes would be registered in the name of the new beneficial owner as
follows:

 

Name:

Address:

Taxpayer ID
Number:

 

The
undersigned represents and warrants to you that:

 

1.                                       We
are an institutional “accredited investor” (as defined in Rule 501(a)(1), (2),
(3) or (7) under the Securities Act of 1933, as amended (the “Securities
Act”)), purchasing for our own account or for the account of such an
institutional “accredited investor” at least $250,000 principal amount at
maturity of the Notes, and we are acquiring the Notes not with a view to, or
for offer or sale in connection with, any distribution in violation of the
Securities Act.  We have such knowledge
and experience in financial and business matters as to be capable of evaluating
the merits and risks of our investment in the Notes, and we invest in or
purchase securities similar to the Notes in the normal course of our
business.  We, and any accounts for which
we are acting, are each able to bear the economic risk of our or its
investment.

 

2.                                       We
understand that the Notes have not been registered under the Securities Act
and, unless so registered, may not be sold except as permitted in the following
sentence.  We agree on our own behalf
and on behalf of any investor account for which we are purchasing Notes to
offer, sell or otherwise transfer such Securities prior to the date that is two
years after the later of the date of original issue and the last date on which
the Company or any affiliate of the Company was the owner of such Notes (or any
predecessor thereto) (the “Resale Restriction Termination Date”) only
(a) to the Company, (b) pursuant to a registration statement that has
been declared effective under the Securities Act, (c) in a transaction
complying with the requirements of Rule 144A under the Securities Act
(“Rule 144A”), to a person we reasonably believe is a qualified
institutional buyer under Rule 144A (a “QIB”) that is purchasing for its
own account or for the

 

 

 

account of a
QIB and to whom notice is given that the transfer is being made in reliance on
Rule 144A, (d) to an institutional “accredited investor” within the
meaning of Rule 501(a)(1), (2), (3) or (7) under the Securities Act that is
purchasing for its own account or for the account of such an institutional
“accredited investor,” in each case, in a minimum principal amount at maturity
of Notes of $250,000, or (e) pursuant to any other available exemption
from the registration requirements of the Securities Act, including the
exemption provided for by Rule 144 thereunder (if available) subject in
each of the foregoing cases to any requirement of law that the disposition of
our property or the property of such investor account or accounts be at all
times within our or their control and in compliance with any applicable state
securities laws.  The foregoing
restrictions on resale will not apply subsequent to the Resale Restriction
Termination Date.  If any resale or
other transfer of the Notes is proposed to be made pursuant to clause (d)
above prior to the Resale Restriction Termination Date, the transferor shall
deliver a letter from the transferee substantially in the form of this letter
to the Company and the Trustee, which shall provide, among other things, that
the transferee is an institutional “accredited investor” within the meaning of
Rule 501(a)(1), (2), (3) or (7) under the Securities Act and that it is
acquiring such Notes for investment purposes and not for distribution in
violation of the Securities Act.  Each
purchaser acknowledges that the Company and the Trustee reserve the right prior
to the offer, sale or other transfer prior to the Resale Restriction
Termination Date of the Securities pursuant to clause (d) or (e) above to
require the delivery of an opinion of counsel, certifications or other
information satisfactory to the Company and the Trustee.

 

	
   

  	
  TRANSFEREE:

  	
   

  	
  ,

  
	
   

  	
   

  
	
   

  	
  by:

  	
   

  	
   

  
						

 

2

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