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Exhibit 4.1  

        PRIMUS TELECOMMUNICATIONS HOLDING, INC.,

as Issuer 

PRIMUS
TELECOMMUNICATIONS GROUP, INCORPORATED,

as a Guarantor 

AND 

WACHOVIA
BANK, NATIONAL ASSOCIATION,

as Trustee 

Indenture 

Dated
as of January 16, 2004 

8%
Senior Notes Due 2014

8% Series B Senior Notes Due 2014 

  

 
 

TABLE OF CONTENTS    
    

	 
	 	Page

	ARTICLE ONE DEFINITIONS AND OTHER PROVISIONS OF GENERAL APPLICATION	 	1
	

SECTION 101. Definitions	
 	

1
	 	Acquired Indebtedness	 	1
	 	Act	 	2
	 	Additional Notes	 	2
	 	Additional Interest	 	2
	 	Affiliate	 	2
	 	Agent Member	 	2
	 	Asset Acquisition	 	2
	 	Asset Disposition	 	2
	 	Asset Sale	 	2
	 	Average Life	 	3
	 	Board of Directors	 	3
	 	Board Resolution	 	3
	 	Business Day	 	3
	 	Capital Stock	 	3
	 	Capitalized Lease	 	3
	 	Change of Control	 	3
	 	Change of Control Offer	 	4
	 	Change of Control Payment	 	4
	 	Change of Control Payment Date	 	4
	 	Closing Date	 	4
	 	Collateral	 	4
	 	Collateral Agent	 	4
	 	Collateral Documents	 	4
	 	Commission	 	4
	 	Common Stock	 	4
	 	Consolidated Cash Flow	 	4
	 	Consolidated Fixed Charges	 	4
	 	Consolidated Interest Expense	 	4
	 	Consolidated Net Income	 	5
	 	Contingently Transferable Subsidiaries	 	5
	 	Corporate Trust Office	 	5
	 	corporation	 	5
	 	covenant defeasance	 	5
	 	Credit Facilities	 	6
	 	Currency Agreement	 	6
	 	Default	 	6
	 	Defaulted Interest	 	6
	 	defeasance	 	6
	 	Depositary	 	6
	 	Eligible Accounts Receivable	 	6
	 	Eligible Institution	 	6
	 	Employment Agreement	 	6
	 	Equity Offering	 	6
	 	Event of Default	 	6
	 	Excess Proceeds	 	6
	 	 	 

i

 

	 	Excess Proceeds Offer	 	6
	 	Excess Proceeds Payment	 	6
	 	Excess Proceeds Payment Date	 	6
	 	Exchange Act	 	6
	 	Exchange Notes	 	6
	 	Exchange Offer	 	6
	 	Exchange Offer Registration Statement	 	6
	 	Existing Indebtedness	 	7
	 	Fair Market Value	 	7
	 	GAAP	 	7
	 	Global Notes	 	7
	 	Government Securities	 	7
	 	Guarantee	 	7
	 	Guarantor	 	7
	 	Holder	 	7
	 	Incur	 	7
	 	Indebtedness	 	7
	 	Indemnification Arrangements	 	8
	 	Indenture	 	8
	 	Initial Notes	 	8
	 	Initial Purchasers	 	8
	 	Interest Payment Date	 	8
	 	Interest Rate Agreement	 	8
	 	Interim Pledge Agreement	 	8
	 	Investment	 	8
	 	Issuance Date	 	9
	 	Issuer	 	9
	 	Issuer Request	 	9
	 	Issuer Order	 	9
	 	Lien	 	9
	 	Marketable Securities	 	9
	 	Maturity	 	9
	 	Net Cash Proceeds	 	9
	 	Non-Registration Opinion and Supporting Evidence	 	10
	 	Note Register	 	10
	 	Note Registrar	 	10
	 	Notes	 	10
	 	Officer's Certificate	 	10
	 	Offshore Global Notes	 	10
	 	Offshore Notes Exchange Date	 	10
	 	Offshore Physical Notes	 	10
	 	Opinion of Counsel	 	10
	 	Original Notes	 	10
	 	Outstanding	 	10
	 	Parent Guarantee	 	11
	 	Paying Agent	 	11
	 	Payment Account	 	11
	 	Permitted Business	 	11
	 	Permitted Investment	 	11
	 	Permitted Liens	 	12
	 	 	 

ii

 

	 	Person	 	13
	 	Physical Notes	 	13
	 	Predecessor Note	 	13
	 	Preferred Stock	 	14
	 	Private Placement Legend	 	14
	 	Pro Forma Consolidated Cash Flow	 	14
	 	Proportionate Share	 	14
	 	Purchase Money Obligations	 	14
	 	QIB	 	14
	 	Redeemable Stock	 	14
	 	Redemption Date	 	14
	 	Redemption Price	 	14
	 	Registration Rights Agreement	 	14
	 	Registration Statement	 	15
	 	Regular Record Date	 	15
	 	Regulation S	 	15
	 	Resale Restriction Termination Date	 	15
	 	Responsible Officer	 	15
	 	Restricted Payments	 	15
	 	Restricted Subsidiary	 	15
	 	Rule 144A	 	15
	 	Securities Act	 	15
	 	Shelf Registration Statement	 	15
	 	Significant Subsidiary	 	15
	 	Special Record Date	 	15
	 	Stated Maturity	 	15
	 	Subordinated Indebtedness	 	15
	 	Subsidiary	 	15
	 	Trade Payables	 	16
	 	Transaction Date	 	16
	 	Trust Indenture Act	 	16
	 	TIA	 	16
	 	Trustee	 	16
	 	Unclaimed Excess Proceeds	 	16
	 	Uniform Commercial Code	 	16
	 	Unrestricted Subsidiary	 	16
	 	Unrestricted Subsidiary Indebtedness	 	16
	 	U.S. Global Note	 	16
	 	U.S. Government Obligations	 	16
	 	U.S. Physical Notes	 	16
	 	Vice President	 	17
	 	Voting Stock	 	17
	SECTION 102. Incorporation by Reference of Trust Indenture Act	 	17
	SECTION 103. Compliance Certificates and Opinions	 	17
	SECTION 104. Form of Documents Delivered to Trustee	 	17
	SECTION 105. Acts of Holders	 	18
	SECTION 106. Notices, Etc. to Trustee, Obligors	 	19
	SECTION 107. Notice to Holders; Waiver	 	19
	SECTION 108. Effect of Headings and Table of Contents	 	19
	SECTION 109. Successors and Assigns	 	20
	 	 	 

iii

 

	SECTION 110. Separability Clause	 	20
	SECTION 111. Benefits of Indenture	 	20
	SECTION 112. Governing Law	 	20
	SECTION 113. Legal Holidays	 	20
	
 ARTICLE TWO NOTE FORMS	
 	

20
	
 SECTION 201. Forms Generally	
 	

20
	SECTION 202. Restrictive Legends	 	21
	
 ARTICLE THREE THE NOTES	
 	

23
	
 SECTION 301. Titles and Terms	
 	

23
	SECTION 302. Denominations	 	24
	SECTION 303. Execution, Authentication, Delivery and Dating	 	24
	SECTION 304. Temporary Note	 	25
	SECTION 305. Registration, Registration of Transfer and Exchange	 	25
	SECTION 306. Book-Entry Provisions for Global Notes	 	26
	SECTION 307. Transfer Provisions	 	27
	SECTION 308. Mutilated, Destroyed, Lost and Stolen Notes	 	33
	SECTION 309. Payment of Interest; Interest Rights Preserved	 	33
	SECTION 310. Persons Deemed Owners	 	34
	SECTION 311. Cancellation	 	34
	SECTION 312. Computation of Interest.	 	34
	SECTION 313. CUSIP Numbers.	 	35
	
 ARTICLE FOUR SATISFACTION AND DISCHARGE	
 	

35
	
 SECTION 401. Satisfaction and Discharge of Indenture.	
 	

35
	SECTION 402. Application of Trust Money.	 	36
	
 ARTICLE FIVE REMEDIES	
 	

36
	
 SECTION 501. Events of Default	
 	

36
	SECTION 502. Acceleration of Maturity; Rescission and Annulment.	 	38
	SECTION 503. Collection of Indebtedness and Suits for Enforcement by Trustee	 	39
	SECTION 504. Trustee May File Proofs of Claim	 	39
	SECTION 505. Trustee May Enforce Claims Without Possession of Notes	 	40
	SECTION 506. Application of Money Collected	 	40
	SECTION 507. Limitation on Suits	 	40
	SECTION 508. Unconditional Right of Holders to Receive Principal, Premium and Interest	 	41
	SECTION 509. Restoration of Rights and Remedies	 	41
	SECTION 510. Rights and Remedies Cumulative	 	41
	SECTION 511. Delay or Omission Not Waiver	 	41
	SECTION 512. Control by Holders	 	41
	SECTION 513. Waiver of Past Defaults	 	42
	SECTION 514. Waiver of Stay or Extension Laws	 	42
	
 ARTICLE SIX THE TRUSTEE	
 	

42
	
 SECTION 601. Notice of Defaults; Certain Duties of Trustee	
 	

42
	SECTION 602. Certain Rights of Trustee	 	43
	SECTION 603. Trustee Not Responsible for Recitals or Issuance of Notes	 	45
	SECTION 604. May Hold Notes	 	45
	SECTION 605. Money Held in Trust	 	45
	 	 	 

iv

 

	SECTION 606. Compensation and Reimbursement	 	45
	SECTION 607. Corporate Trustee Required; Eligibility	 	46
	SECTION 608. Resignation and Removal; Appointment of Successor	 	46
	SECTION 609. Acceptance of Appointment by Successor	 	47
	SECTION 610. Merger, Conversion, Consolidation or Succession to Business	 	47
	
 ARTICLE SEVEN HOLDERS LISTS AND REPORTS BY TRUSTEE AND ISSUER	
 	

48
	
 SECTION 701. Disclosure of Names and Addresses of Holders	
 	

48
	SECTION 702. Reports by Trustee	 	48
	
 ARTICLE EIGHT CONSOLIDATION, MERGER, CONVEYANCE, TRANSFER OR LEASE	
 	

48
	
 SECTION 801. Obligors May Consolidate, Etc., Only on Certain Terms	
 	

48
	SECTION 802. Successor Substituted	 	49
	SECTION 803. Notes to Be Secured in Certain Events	 	49
	
 ARTICLE NINE SUPPLEMENTAL INDENTURES	
 	

50
	
 SECTION 901. Supplemental Indentures Without Consent of Holders	
 	

50
	SECTION 902. Supplemental Indentures with Consent of Holders	 	50
	SECTION 903. Execution of Supplemental Indentures	 	51
	SECTION 904. Effect of Supplemental Indentures	 	51
	SECTION 905. Conformity with Trust Indenture Act	 	52
	SECTION 906. Reference in Notes to Supplemental Indentures	 	52
	SECTION 907. Notice of Supplemental Indentures	 	52
	
 ARTICLE TEN COVENANTS	
 	

52
	
 SECTION 1001. Payment of Principal, Premium, if Any, and Interest	
 	

52
	SECTION 1002. Maintenance of Office or Agency	 	52
	SECTION 1003. Money for Note Payments to Be Held in Trust	 	52
	SECTION 1004. Corporate Existence	 	53
	SECTION 1005. Payment of Taxes and Other Claims	 	54
	SECTION 1006. Maintenance of Properties	 	54
	SECTION 1007. Insurance	 	54
	SECTION 1008. Statement by Officers As to Default	 	54
	SECTION 1009. Provision of Financial Statements	 	55
	SECTION 1010. Repurchase of Notes upon a Change of Control	 	55
	SECTION 1011. Limitation on Indebtedness	 	56
	SECTION 1012. Limitation on Restricted Payments	 	60
	SECTION 1013. Limitation on Dividend and Other Payment Restrictions Affecting Restricted Subsidiaries	 	62
	SECTION 1014. Limitation on the Issuance and Sale of Voting Stock of Restricted Subsidiaries	 	64
	SECTION 1015. Limitation on Transactions with Shareholders and Affiliates	 	64
	SECTION 1016. Limitation on Liens	 	66
	SECTION 1017. Limitation on Asset Sales	 	66
	SECTION 1018. Limitation on Issuances of Guarantees of Indebtedness by Restricted Subsidiaries	 	67
	SECTION 1019. Business of Parent	 	68
	SECTION 1020. Internal Reorganization	 	68
	SECTION 1021. Intentionally omitted	 	68
	SECTION 1022. Waiver of Certain Covenants	 	68
	 	 	 

v

 

	
 ARTICLE ELEVEN REDEMPTION OF NOTES	
 	

68
	
 SECTION 1101. Right of Redemption	
 	

68
	SECTION 1102. Applicability of Article	 	69
	SECTION 1103. Election to Redeem Notice to Trustee	 	69
	SECTION 1104. Selection by Trustee of Notes to Be Redeemed	 	69
	SECTION 1105. Notice of Redemption	 	69
	SECTION 1106. Deposit of Redemption Price	 	70
	SECTION 1107. Notes Payable on Redemption Date	 	70
	SECTION 1108. Notes Redeemed in Part	 	70
	
 ARTICLE TWELVE PARENT GUARANTEE	
 	

70
	
 SECTION 1201. Guarantee	
 	

70
	SECTION 1202. Limitation on Liability; Termination, Release and Discharge	 	72
	SECTION 1203. No Subrogation	 	72
	
 ARTICLE THIRTEEN COLLATERAL	
 	

72
	
 SECTION 1301. Interim Pledge Agreement	
 	

72
	SECTION 1302. Opinions	 	73
	SECTION 1303. Release of the Collateral.	 	73
	SECTION 1304. Certificates of Parent	 	73
	SECTION 1305. Authorization of Actions to be Taken by the Trustee Under the Interim Pledge Agreement.	 	74
	SECTION 1306. Authorization of Receipt of Funds by the Trustee Under the Interim Pledge Agreement	 	74
	SECTION 1307. Release Upon Termination of Guaranteed Obligations.	 	74
	
 ARTICLE FOURTEEN DEFEASANCE AND COVENANT DEFEASANCE	
 	

75
	
 SECTION 1401. Issuer's Option to Effect Defeasance or Covenant Defeasance	
 	

75
	SECTION 1402. Defeasance and Discharge	 	75
	SECTION 1403. Covenant Defeasance	 	75
	SECTION 1404. Conditions to Defeasance or Covenant Defeasance	 	75
	SECTION 1405. Deposited Money and U.S. Government Obligations to Be Held in Trust;

                             Other Miscellaneous Provisions	 	77
	SECTION 1406. Reinstatement	 	77

vi

 
 
 

TESTIMONIUM SIGNATURE AND SEALS    
    

	EXHIBIT A	 	Form of Note
	
 EXHIBIT B	
 	

Form of Certificate to be Delivered Upon Termination of Restriction Period
	
 EXHIBIT C	
 	

Form of Certificate to be Delivered in Connection with Transfers to Non-QIB Institutional Accredited Investors
	
 EXHIBIT D	
 	

Form of Certificate to be Delivered in Connection with Transfers Pursuant to Regulation S
	
 EXHIBIT E	
 	

Rule 144A Certificate

vii

        INDENTURE, dated as of January 16, 2004, between PRIMUS TELECOMMUNICATIONS HOLDING, INC., a corporation duly organized and existing under the laws of the State of Delaware
(herein called the "Issuer"), PRIMUS TELECOMMUNICATIONS GROUP, INCORPORATED, a corporation duly organized and existing under the laws of the State of Delaware (herein called "Parent"), and WACHOVIA
BANK, NATIONAL ASSOCIATION, a national banking association, duly organized and existing under the laws of the United States, as Trustee (the "Trustee"). 

RECITALS OF THE ISSUER AND PARENT  

        The Issuer has duly authorized the creation of an issue of 8% Senior Notes Due 2014 (the "Initial Notes") and 8% Series B Senior Notes Due 2014 (the
"Exchange Notes") and, together with the Initial Notes, the "Notes"), of substantially the tenor and amount hereinafter set forth, and to provide therefor the Issuer has duly authorized the execution
and delivery of this Indenture. The issuance of Notes on the Closing Date shall be limited to an aggregate principal amount of $240,000,000 (the "Original Notes"). Subject to the conditions set forth
herein and to compliance with Section 1011, the Issuer may issue additional Notes in an unlimited aggregate principal amount (the "Additional Notes") subsequent to the Closing Date (as defined
herein). 

        Parent
has duly authorized the Parent Guarantee (as defined herein). 

        Upon
the issuance of the Exchange Notes, if any, or the effectiveness of the Shelf Registration Statement (as defined herein), this Indenture will be subject to the provisions of the
Trust Indenture Act of 1939, as amended, that are required to be part of this Indenture and shall, to the extent applicable, be governed by such provisions. All things necessary have been done to make
the Notes, when executed by the Issuer and authenticated and delivered hereunder and duly issued by the Issuer, the valid obligations of the Issuer in accordance with their terms and to make this
Indenture a valid agreement of the Issuer and Parent, in accordance with its terms. 

NOW, THEREFORE, THIS INDENTURE WITNESSETH:  

        For and in consideration of the premises and the purchase of the Notes by the Holders thereof, it is mutually covenanted and agreed, for the equal and
proportionate benefit of all Holders of the Notes, as follows: 

 
 

ARTICLE ONE    
    DEFINITIONS AND OTHER PROVISIONS OF GENERAL APPLICATION    
    

        SECTION 101.    Definitions. 

        For
all purposes of this Indenture, except as otherwise expressly provided or unless the context otherwise requires: 

        (a)   the
terms defined in this Article have the meaning assigned to them in this Article, and include the plural as well as the singular; 

        (b)   all
other terms used herein which are defined in the Trust Indenture Act, either directly or by reference therein, have the meanings assigned to them therein, and the
terms "cash transaction" and "self-liquidating paper", as used in TIA Section 311, shall have the meanings assigned to them in the rules of the Commission adopted under the Trust
Indenture Act; 

        (c)   all
accounting terms not otherwise defined herein have the meanings assigned to them in accordance with generally accepted accounting principles, and 

        (d)   the
words "herein," "hereof" and "hereunder" and other words of similar import refer to this Indenture as a whole and not to any particular Article, Section or other
subdivision. 

        "Accredited
Investor Certificate" has the meaning specified in Section 307. 

        "Acquired
Indebtedness" means Indebtedness of a Person existing at the time such Person becomes a Restricted Subsidiary of an Obligor or assumed in connection with an Asset Acquisition
by an 

 

Obligor
or a Restricted Subsidiary of an Obligor and not incurred in connection with, or in anticipation of, such Person becoming a Restricted Subsidiary of an Obligor or such Asset Acquisition;
provided that Indebtedness of such Person which is redeemed, defeased, retired or otherwise repaid at the time of or upon the consummation of the transactions by which
such Person becomes a Restricted Subsidiary of an Obligor or such Asset Acquisition shall not be Indebtedness. 

        "Act",
when used with respect to any Holder, has the meaning specified in Section 105. 

        "Additional
Notes" means any Notes issued subsequent to the Closing Date (other than Exchange Notes issued in exchange for Initial Notes) in accordance with the terms of this Indenture,
including Section 301, Section 303 and Section 1011. 

        "Additional
Interest" means all additional interest then owing pursuant to Section 5 of the Registration Rights Agreement. 

        "Affiliate"
means, as applied to any Person, any other Person directly or indirectly controlling, controlled by, or under direct or indirect common control with, such Person. For
purposes of this definition, "control" (including, with correlative meanings, the terms "controlling", "controlled by" and "under common control with"), as applied to any Person, means the possession,
directly or indirectly, of the power to direct or cause the direction of the management and policies of such Person, whether through the ownership of voting securities, by contract or otherwise. For
purposes of the Indenture, "Affiliate" shall be deemed to include Mr. K. Paul Singh. 

        "Agent
Member" has the meaning specified in Section 306. 

        "Asset
Acquisition" means (i) an investment by Parent or any of its Restricted Subsidiaries in any other Person pursuant to which such Person shall become a Restricted Subsidiary
of Parent or shall be merged into or consolidated with Parent or any of its Restricted Subsidiaries or (ii) an acquisition by Parent or any of its Restricted Subsidiaries of the property and
assets of any Person other than Parent or any of its Restricted Subsidiaries that constitute substantially all of a division or line of business of such Person. 

        "Asset
Disposition" means the sale or other disposition by Parent or any of its Restricted Subsidiaries (other than to Parent or another of its Restricted Subsidiaries) of (i) all
or substantially all of the Capital Stock of any Restricted Subsidiary of Parent or (ii) all or substantially all of the assets that constitute a division or line of business of Parent or any
of its Restricted Subsidiaries. 

        "Asset
Sale" means any sale, transfer or other disposition (including by way of merger, consolidation or sale-leaseback transactions) in one transaction or a series of
related transactions by Parent or any of its Restricted Subsidiaries to any Person other than Parent or any of its Restricted Subsidiaries of (i) all or any of the Capital Stock of any
Subsidiary of Parent, (ii) all or substantially all of the property and assets of an operating unit or business of Parent or any of its Restricted Subsidiaries or (iii) any other
property and assets of Parent or any of its Restricted Subsidiaries outside the ordinary course of business of Parent or such Restricted Subsidiary and, in each case, that is not governed by the
provisions of this Indenture applicable to mergers, consolidations and sales of assets of Parent or the Issuer and which, in the case of any of clause (i), (ii) or (iii) above,
whether in one transaction or a series of related transactions, (a) have a Fair Market Value in excess of $5.0 million or (b) are for net proceeds in excess of
$5.0 million; provided that (i) sales or other dispositions of inventory, receivables, Marketable Securities and other current assets in the ordinary course of business;
(ii) grants of leases or licenses in the ordinary course of business; (iii) any sale, transfer, assignment or other disposition of property that is damaged, worn-out,
obsolete or no longer suitable for use in the ordinary course of business; (iv) sales or other dispositions of assets for consideration at least equal to the Fair Market Value (as determined in
good faith by the Board of Directors of Parent, whose determination shall be conclusive and evidenced by a Board Resolution) of the assets sold or disposed of, to the extent that the consideration
received would constitute property or assets of the 

2

 

kind
described in clause (i)(B) of the second paragraph of Section 1017; (v) grants of Voting Stock or options or other rights to acquire shares of Voting Stock (or issuances of
Voting Stock upon the exercise of such options or other rights) made to employees or directors as described in clause (iii) of Section 1014; and (vi) issuances of Capital Stock by
Unrestricted Subsidiaries of Parent, shall not be included within the meaning of "Asset Sale." 

        "Average
Life" means, at any date of determination with respect to any debt security, the quotient obtained by dividing (i) the sum of the products of (a) the number of
years from such date of determination to the dates of each successive scheduled principal payment of such debt security and (b) the amount of such principal payment by (ii) the sum of
all such principal payments. 

        "Board
of Directors" means either the Board of Directors of the Issuer or Parent, as the case may be, or any duly authorized committee of such board. 

        "Board
Resolution" means a copy of a resolution certified by the Secretary or an Assistant Secretary of the Issuer or Parent, as the case may be, to have been duly adopted by the Board
of Directors of the Issuer or Parent, as the case may be, and to be in full force and effect on the date of such certification, and delivered to the Trustee. 

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

        "Capital
Stock" means, with respect to any Person, any and all shares, interests, participations or other equivalents (however designated, whether voting or non-voting) in
equity of such Person, whether now outstanding or issued after the date of this Indenture, including, without limitation, all Common Stock and Preferred Stock. 

        "Capitalized
Lease" means, as applied to any Person, any lease of any property (whether real, personal or mixed) of which the discounted present value of the rental obligations of such
Person as lessee, in conformity with GAAP, is required to be capitalized on the balance sheet of such Person; and "Capitalized Lease Obligation" means the discounted present value of the rental
obligations under such lease. 

        "Change
of Control" means such time as (i) a "person" or "group" (within the meaning of Sections 13(d) and 14(d)(2) of the Exchange Act) becomes the ultimate "beneficial owner"
(as defined in Rule 13d-3 under the Exchange Act) of more than 50% of the total voting power of the then outstanding Voting Stock of Parent on a fully diluted basis;
(ii) individuals who at the beginning of any period of two consecutive calendar years constituted the Board of Directors of Parent (together with any directors who are members of the Board of
Directors on the date hereof and any new directors whose election by the Board of Directors or whose nomination for election by Parent' stockholders was approved by a vote of at least
two-thirds of the members of the Board of Directors then still in office who either were members of the Board of Directors at the beginning of such period or whose election or nomination
for election was previously so approved) cease for any reason to constitute a majority of the members of such Board of Directors then in office; (iii) the sale, lease, transfer, conveyance or
other disposition (other than by way of merger or consolidation), in one or a series of related transactions, of all or substantially all of the assets of Parent and its Subsidiaries taken as a whole
to any such "person" or "group" (other than to Parent or a Restricted Subsidiary); (iv) the merger or consolidation of Parent with or into another corporation or the merger of another
corporation with or into Parent with the effect that immediately after such transaction any such "person" or "group" of persons or entities shall have become the beneficial owner of securities of the
surviving corporation of such merger or consolidation representing a majority of the total voting power of the then outstanding Voting Stock of the surviving corporation; (v) the adoption of a
plan relating to the liquidation or 

3

 

dissolution
of Parent or the Issuer; or (vi) Parent shall fail to own 100% of the issued and outstanding Voting Stock of the Issuer. 

        "Change
of Control Offer" has the meaning specified in Section 1010. 

        "Change
of Control Payment" has the meaning specified in Section 1010. 

        "Change
of Control Payment Date" has the meaning specified in Section 1010. 

        "Closing
Date" means January 16, 2004. 

        "Code"
means the Internal Revenue Code of 1986, as amended. 

        "Collateral"
means all of the property from time to time in which Liens are purported to be granted to secure the Parent Guarantee pursuant to the Collateral Documents, including,
without limitation, all of the shares of Capital Stock of the Contingently Transferable Subsidiaries, together with all stock certificates, options or rights of any nature whatsoever that may be
issued or granted by the Contingently Transferable Subsidiaries to Parent while the Interim Pledge Agreement is in effect, and all proceeds thereof. 

        "Collateral
Agent" means Wachovia Bank, National Association, as collateral agent under the Interim Pledge Agreement. 

        "Collateral
Documents" means, collectively, the Interim Pledge Agreement and all other security documents hereafter delivered to the Collateral Agent granting a Lien on any property of
Parent to secure its obligations under the Notes and this Indenture, as amended, amended and restated, modified, renewed, replaced or restructured from time to time. 

        "Commission"
means the Securities and Exchange Commission, as from time to time constituted, created under the Securities Exchange Act of 1934, or, if at any time after the execution of
this Indenture such Commission is not existing and performing the duties now assigned to it under the Trust Indenture Act, then the body performing such duties at such time. 

        "Common
Stock" means, with respect to any Person, any and all shares, interests, participations or other equivalents (however designated, whether voting or non-voting) of
such Person's common stock, whether now outstanding or issued after the date of this Indenture, including, without limitation, all series and classes of such common stock. 

        "Consolidated
Cash Flow" means, with respect to an Obligor, for any period, the sum of the amounts for such period of (i) Consolidated Net Income, (ii) Consolidated
Interest Expense, (iii) income taxes, to
the extent such amount was deducted in calculating Consolidated Net Income (other than income taxes (either positive or negative) attributable to extraordinary and non-recurring gains or
losses or sales of assets), (iv) depreciation expense, to the extent such amount was deducted in calculating Consolidated Net Income, (v) amortization expense, to the extent such amount
was deducted in calculating Consolidated Net Income, and (vi) all other non-cash items reducing Consolidated Net Income (excluding any non-cash charge to the extent that
it represents an accrual of or reserve for cash charges in any future period), less all non-cash items increasing Consolidated Net Income, all as determined on a consolidated basis for
such Obligor and its Restricted Subsidiaries in conformity with GAAP. 

        "Consolidated
Fixed Charges" means, for any period, Consolidated Interest Expense plus dividends declared and payable on Preferred Stock of Parent and its Restricted Subsidiaries. 

        "Consolidated
Interest Expense" means, with respect to an Obligor, for any period, the aggregate amount of interest in respect of Indebtedness (including capitalized interest,
amortization of original issue discount on any Indebtedness and the interest portion of any deferred payment obligation, calculated in accordance with the effective interest method of accounting; all
commissions, discounts 

4

 

and
other fees and charges owed with respect to letters of credit and bankers' acceptance financing; the net costs associated with Interest Rate Agreements; and interest on Indebtedness that is
Guaranteed or secured by such Obligor or any of its Restricted Subsidiaries) and all but the principal component of rentals in respect of Capitalized Lease obligations paid, accrued or scheduled to be
paid or to be accrued by such Obligor and its Restricted Subsidiaries during such period. 

        "Consolidated
Net Income" means, with respect to an Obligor, for any period, the aggregate consolidated net income (or loss) of such Obligor and its Restricted Subsidiaries for such
period determined in conformity with GAAP; provided that the following items shall be excluded in computing Consolidated Net Income (without duplication):
(i) solely for the purposes of calculating the amount of Restricted Payments that may be made pursuant to clause (C) of the first paragraph of Section 1012, the net income (or
loss) of any Person accrued prior to the date it becomes a Restricted Subsidiary or is merged into or consolidated with such Obligor or any of its Restricted Subsidiaries or all or substantially all
of the property and assets of such Person are acquired by such Obligor or any of its Restricted Subsidiaries; (ii) any gains or losses (on an after-tax basis) attributable to Asset
Sales by such Obligor or any of its Restricted Subsidiaries; (iii) except for purposes of calculating the amount of Restricted Payments that may be made pursuant to clause (C) of the
first paragraph of Section 1012, any amount paid or accrued as dividends on Preferred Stock of such Obligor or Preferred Stock of any Restricted Subsidiary owned by Persons other than such
Obligor and any of its Restricted Subsidiaries; (iv) all extraordinary gains and extraordinary losses; and (v) the net income (or loss) of any Person (other than net income (or loss)
attributable to a Restricted Subsidiary of such Obligor) in which any Person (other than Parent or any of its Restricted Subsidiaries) has a joint interest, except to the extent of the amount of
dividends or other distributions actually paid to such Obligor or any of its Restricted Subsidiaries by such other Person during such period. 

        "Contingently
Transferable Subsidiaries" means all of the direct Subsidiaries of Parent (other than the Issuer) as of the Closing Date, namely Primus Telecommunications, Inc. and
TresCom International, Inc. 

        "Corporate
Trust Office" means, for purposes of presentation or surrender of Notes for payment, registration, transfer, exchange, conversion or purchase or for service of notices or
demands upon the Issuer, the office of the Trustee located in The City of New York at which at any particular time its corporate trust business shall be administered (which at the date of execution of
this Indenture is located at 40 Broad Street, Fifth Floor, New York, New York 10004), and for all other purposes, the office of the Trustee located in the City of Richmond, Virginia (which at the date
of this Indenture is located at 1021 East Cary Street, Richmond, Virginia 23219, Attention: Corporate Trust Administration—VA 9646), 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 address as a successor Trustee may designate from time to time by notice
to the Holders and the Issuer). 

        "corporation"
includes corporations, associations, companies and business trusts. 

        "covenant
defeasance" has the meaning specified in Section 1403. 

        "Credit
Facilities" means one or more credit agreements, debt facilities, indentures or commercial paper facilities with banks or other institutional lenders or investors providing for
revolving credit loans, term loans, receivables financing (including through the sale of receivables to such lenders or to special purpose entities formed to borrow from such lenders against such
receivables), letters of credit or debt securities financings, in each case, as amended, restated, modified, renewed, refunded, replaced or refinanced in whole or in part from time to time. 

5

 

        "Currency
Agreement" means any foreign exchange contract, currency swap agreement and any other arrangement and agreement designed to provide protection against fluctuations in currency
values. 

        "Default"
means any event that is, or after notice or passage of time or both would be, an Event of Default. 

        "Defaulted
Interest" has the meaning specified in Section 309. 

        "defeasance"
has the meaning specified in Section 1402. 

        "Designated
Subsidiaries" has the meaning specified in Section 1014. 

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

        "Eligible
Accounts Receivable" means the accounts receivables (net of any reserves and allowances for doubtful accounts in accordance with GAAP) of any Person that are not more than
60 days past their due date and that were entered into in the ordinary course of business on normal payment terms as shown on the most recent consolidated balance sheet of such Person filed
with the Commission, all in accordance with GAAP. 

        "Eligible
Institution" means a commercial banking institution that has combined capital and surplus of not less than $500 million or its equivalent in foreign currency, whose debt
is rated "A-3" or higher or "A-" or higher according to Moody's Investors Service, Inc. or Standard & Poor's Ratings Group (or such similar equivalent rating by
at least one "nationally recognized statistical rating organization" (as defined in Rule 436 under the Securities Act)) respectively, at the time as of which any investment or rollover therein
is made. 

        "Employment
Agreement" means the employment agreement between Parent and Mr. K. Paul Singh, dated June 1994. 

        "Equity
Offering" means a private or public offering or sale for cash of the Common Stock of Parent. 

        "Event
of Default" has the meaning specified in Section 501. 

        "Excess
Proceeds" has the meaning specified in Section 1017. 

        "Excess
Proceeds Offer" has the meaning specified in Section 1017. 

        "Excess
Proceeds Payment" has the meaning specified in Section 1017. 

        "Excess
Proceeds Payment Date" has the meaning specified in Section 1017. 

        "Exchange
Act" means the Securities Exchange Act of 1934, as amended. 

        "Exchange
Notes" has the meaning stated in the first recital of this Indenture and refers to any Exchange Notes containing terms substantially identical to the Initial Notes (except that
such Exchange Notes shall be registered under the Securities Act and will not contain (i) transfer restrictions or (ii) certain provisions relating to the increase in the interest rate
of such Exchange Notes) that are issued and exchanged for Initial Notes pursuant to the Registration Rights Agreement and this Indenture. 

        "Exchange
Offer" means the offer by the Issuer to the Holders of Initial Notes to exchange Initial Notes for Exchange Notes, as provided in the Registration Rights Agreement. 

        "Exchange
Offer Registration Statement" means the Exchange Offer Registration Statement as defined in the Registration Rights Agreement. 

6

 

        "Existing
Indebtedness" means Indebtedness of Parent or its Restricted Subsidiaries outstanding on the date of this Indenture. 

        "Fair
Market Value" means, with respect to any asset or property, the sale value that would be obtained in an arm's length transaction between an informed and willing seller under no
compulsion to sell and an informed and willing buyer. 

        "GAAP"
means generally accepted accounting principles in the United States of America as in effect from time to time, including, without limitation, those set forth in the opinions and
pronouncements of the Accounting Principles Board of the American Institute of Certified Public Accountants and statements and pronouncements of the Financial Accounting Standards Board or in such
other statements by such other entity as approved by a significant segment of the accounting profession. 

        "Global
Notes" has the meaning set forth in Section 201. 

        "Government
Securities" means direct obligations of, or obligations guaranteed by, the United States of America for the payment of which obligations or guarantee the full faith and
credit of the United States is pledged. 

        "Guarantee"
means any obligation, contingent or otherwise, of any Person directly or indirectly guaranteeing any Indebtedness or other obligation of any other Person and, without
limiting the generality of the foregoing, any obligation, direct or indirect, contingent or otherwise, of such Person (i) to purchase or pay (or advance or supply funds for the purchase or
payment of) such Indebtedness or other obligation of such other Person (whether arising by virtue of partnership arrangements, or by agreements to keep-well, to purchase assets, goods,
securities or services, to take-or-pay, or to maintain financial statement conditions or otherwise) or (ii) entered into for purposes of assuring in any other manner the
obligee of such Indebtedness or other obligation of the payment thereof or to protect such obligee against loss in respect thereof (in whole or in part); provided 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. 

        "Guaranteed
Obligations" has meaning specified in Section 1201. 

        "Guarantor"
means (i) Parent and (ii) each Restricted Subsidiary of Parent (other than the Issuer) that in the future executes a supplemental indenture in which such
Restricted Subsidiary agrees to be bound by the terms of this Indenture as a Guarantor as described in Section 1018 or in any other manner permitted by the terms of this Indenture. 

        "Holder"
means a Person in whose name a Note is registered in the Note Register. 

        "Incur"
means, with respect to any Indebtedness, to incur, create, issue, assume, Guarantee or otherwise become liable for or with respect to, or become responsible for, the payment of,
contingently or otherwise, such Indebtedness, including an Incurrence of Indebtedness by reason of the acquisition of more than 50% of the Capital Stock of any Person (unless such Person is an
Unrestricted Subsidiary); provided that neither the accrual of interest nor the accretion of original issue discount shall be considered an Incurrence of Indebtedness. 

        "Indebtedness"
means, with respect to any Person at any date of determination (without duplication), (i) all indebtedness of such Person for borrowed money, (ii) all
obligations of such Person evidenced by bonds, debentures, notes or other similar instruments, (iii) all obligations of such Person in respect of letters of credit or other similar instruments
(including reimbursement obligations with respect thereto), (iv) all obligations of such Person to pay the deferred and unpaid purchase price of property or services, 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, except Trade Payables, (v) all obligations
of such Person as lessee under Capitalized Leases, (vi) all Indebtedness of 

7

 

other
Persons secured by a Lien on any asset of such Person, whether or not such Indebtedness is assumed by such Person; provided that the amount of such Indebtedness shall be the lesser of
(A) the Fair Market Value of such asset at such date of determination and (B) the amount of such Indebtedness, (vii) all Indebtedness of other Persons Guaranteed by such Person to
the extent such Indebtedness is Guaranteed by such Person, (viii) the maximum fixed redemption or repurchase price of Redeemable Stock of such Person at the time of determination and, with
respect to any Restricted Subsidiary that is not a Guarantor, any Preferred Stock; and (ix) to the extent not otherwise included in this definition, obligations under Currency Agreements and
Interest Rate Agreements. 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, with respect to
contingent obligations, the maximum liability upon the occurrence of the contingency giving rise to the obligation, provided (i) that the amount outstanding at any time of any Indebtedness
issued with original issue discount is the face amount of such Indebtedness less the remaining unamortized portion of the original issue discount of such Indebtedness at such time as determined in
conformity with GAAP and (ii) that Indebtedness shall not include any liability for federal, state, local or other taxes. 

        "Indemnification
Arrangements" means provisions in the bylaws or other charter or organizational documents of Parent or any of its Restricted Subsidiaries or agreements, in each case
providing for the indemnification of directors, officers, employees, consultants and agents of Parent or any of its Restricted Subsidiaries in the ordinary course of business. 

        "Indenture"
means this instrument as originally executed and as it may from time to time be supplemented or amended by one or more indentures supplemental hereto entered into pursuant to
the applicable provisions hereof. 

        "Initial
Notes" has the meaning stated in the first recital of this Indenture. 

        "Initial
Purchasers" means Lehman Brothers Inc., Morgan Stanley & Co. Incorporated and Jefferies & Company, Inc. 

        "Interest
Payment Date" means the Stated Maturity of an installment of interest on the Notes. 

        "Interest
Rate Agreement" means interest rate swap agreements, interest rate cap agreements, interest rate insurance, and other arrangements and agreements designed to provide protection
against fluctuations in interest rates. 

        "Interim
Pledge Agreement" means the Pledge Agreement, dated as of the Closing Date, made by Parent in favor of the Collateral Agent, as amended, amended and restated or otherwise
modified from time to time 

        "Investment"
in any Person means any direct or indirect advance, loan or other extension of credit (including, without limitation, by way of Guarantee or similar arrangement; but
excluding advances to customers in the ordinary course of business that are, in conformity with GAAP, recorded as accounts receivable on the balance sheet of Parent or its Restricted Subsidiaries) or
capital contribution to (by means of any transfer of cash or other property to others or any payment for property or services for the account or use of others), or any purchase or acquisition of
Capital Stock, bonds, notes, debentures or other similar instruments issued by, such Person. For purposes of the definition of "Unrestricted Subsidiary," Section 1012 and Section 1014,
(i)"Investment" shall include (a) the Fair Market Value of the assets (net of liabilities) of any Restricted Subsidiary of Parent at the time that such Restricted Subsidiary of Parent is
designated an Unrestricted Subsidiary and shall exclude the Fair Market Value of the assets (net of liabilities) of any Unrestricted Subsidiary at the time that such Unrestricted Subsidiary is
designated a Restricted Subsidiary of Parent and (b) the Fair Market Value, in the case of a sale of Voting Stock in accordance with Section 1014 such that a Person no longer constitutes
a Restricted Subsidiary, of the Voting Stock and other Investments in such Person not sold or disposed of and (ii) 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 by the Board of Directors in good faith. The amount of any Investment "outstanding" at any time shall be deemed to be
equal to the amount of such Investment on the date made, less return of capital, repayment of loans, and release of Guarantees, in each case of or to Parent and its Restricted Subsidiaries with
respect to such Investment (up to the amount of such Investment on the date made). 

8

   
        "Issuance Date" means, with respect to any Initial Notes, the date on which such Initial Notes are originally issued, which in the case of the Original Notes shall be the Closing Date
and which in the case of any Additional Notes shall occur after the Closing Date. 

        "Issuer"
means the Person named as the "Issuer" in the first paragraph of this Indenture, until a successor Person shall have become such pursuant to the applicable provisions of this
Indenture, and thereafter "Issuer" shall mean such successor Person. 

        "Issuer
Indebtedness to Consolidated Cash Flow Ratio" has the meaning specified in Section 1011. 

        "Issuer
Request" or "Issuer Order" means a written request or order signed in the name of the Issuer by its Chairman, its President, any Vice President, its Treasurer or an Assistant
Treasurer, and delivered to the Trustee. 

        "Lien"
means any mortgage, pledge, security interest, encumbrance, lien or charge of any kind (including, without limitation, any conditional sale or other title retention agreement or
lease in the nature thereof, any sale with recourse against the seller or any Affiliate of the seller, or any agreement to give any security interest). 

        "Marketable
Securities" means: (i) Government Securities that have a remaining weighted average life to maturity of not more than 18 months from the date of Investment
therein; (ii) any time deposit account, money market deposit and certificate of deposit maturing not more than 270 days after the date of acquisition issued by, or time deposit of, an
Eligible Institution; (iii) commercial paper maturing not more than 180 days after the date of acquisition issued by a corporation (other than an Affiliate of Parent) 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 &
Poor's Rating Group (or such similar equivalent rating by at least one "nationally recognized statistical rating organization" (as defined in Rule 436 under the Securities Act));
(iv) any banker's acceptance or money market deposit accounts issued or offered by an Eligible Institution; (v) repurchase obligations with a term of not more than 30 days for
Government Securities entered into with an Eligible Institution; and (vi) any fund 95% of the assets of which consist of investments of the types described in clauses (i) through
(v) above. 

        "Maturity",
when used with respect to any Notes, means the date on which the principal of such Notes or an installment of principal becomes due and payable as therein or herein provided,
whether at the Stated Maturity or by declaration of acceleration, notice of redemption or otherwise. 

        "Net
Cash Proceeds" means, (a) with respect to any Asset Sale, the proceeds of such Asset Sale in the form of cash or cash equivalents, including payments in respect of deferred
payment obligations (to the extent corresponding to the principal, but not interest, component thereof) when received in the form of cash or cash equivalents (except to the extent such obligations are
financed or sold with recourse to Parent or any of its Restricted Subsidiaries) and proceeds from the conversion of other property received when converted to cash or cash equivalents, net of, without
duplication, (i) brokerage commissions and other fees and expenses (including fees and expenses of counsel and investment bankers) related to such Asset Sale and any relocation or severance
expenses incurred as a result thereof, (ii) provisions for all taxes (whether or not such taxes will actually be paid or are payable) as a result of such Asset Sale without regard to the
consolidated results of operations of Parent and its Restricted Subsidiaries, taken as a whole, (iii) payments made to repay Indebtedness or any other obligation outstanding at the time of such
Asset Sale that either (A) is secured by a Lien on the property or assets sold or (B) is required to be paid as a result of such sale, (iv) all distributions and other payments
required to be made to minority interest holders in Restricted Subsidiaries as a result of such Asset Sale; (v) appropriate amounts to be provided by Parent or any of its Restricted
Subsidiaries as a reserve against any liabilities associated with such Asset Sale, including, without limitation, pension and other post-employment benefit liabilities, liabilities related
to environmental 

9

 

matters
and liabilities under any indemnification obligations associated with such Asset Sale, all as determined in conformity with GAAP, and (vi) any reserves that the Board of Directors of
Parent determines in good faith should be made in respect of the sale price of the property or assets subject to such Asset Sale for post-closing adjustments, provided that upon resolution
of any such adjustments any reserves, to the extent such reserves exceed any amounts paid as a result of such adjustment, shall become Net Cash Proceeds; and (b) with respect to any issuance or
sale of Capital Stock, the proceeds of such issuance or sale in the form of cash or cash equivalents, including payments in respect of deferred payment obligations (to the extent corresponding to the
principal, but not interest, component thereof) when received in the form of cash or cash equivalents (except to the extent such obligations are financed or sold with recourse to Parent or any of its
Restricted Subsidiaries) and proceeds from the conversion of other property received when converted to cash or cash equivalents, net of attorney's fees, accountants' fees, underwriters' or placement
agents' fees, discounts or commissions and brokerage, consultant and other fees incurred in connection with such issuance or sale and net of taxes paid or payable as a result thereof. 

        "Non-Registration
Opinion and Supporting Evidence" has the meaning specified in Section 307. 

        "Note
Register" and "Note Registrar" have the respective meanings specified in Section 305. 

        "Notes"
has the meaning stated in the first recital of this Indenture and more particularly means any Notes authenticated and delivered under this Indenture, including Additional Notes.
For all purposes of this Indenture, the term "Notes" shall include any Exchange Notes to be issued and exchanged for any Initial Notes pursuant to the Registration Rights Agreement and this Indenture
and, for purposes of this Indenture, (A) all Initial Notes and Exchange Notes (including, to the extent provided in clause (B), Additional Notes) shall vote together as one series of
Notes under this Indenture and (B) all Additional Notes that are of the same series as other Notes and bear the same CUSIP numbers as such other Notes shall vote together with such other Notes
as one series of Notes under this Indenture. 

        "October 1999
Senior Notes" means the 123/4% senior notes of Parent due 2009. 

        "Obligors"
means Parent together with the Issuer. 

        "Officer's
Certificate" means, with respect to the Issuer or Parent, a certificate signed by the Chairman, the President, a Vice President, the Treasurer, an Assistant Treasurer, the
Secretary or an Assistant Secretary of the Issuer or Parent (as applicable) and delivered to the Trustee. 

        "Offshore
Global Notes" has the meaning set forth in Section 201. 

        "Offshore
Notes Exchange Date" has the meaning set forth in Section 202. 

        "Offshore
Physical Notes" has the meaning set forth in Section 201. 

        "Opinion
of Counsel" means a written opinion of counsel, who may be counsel for the Issuer or Parent, including an employee of the Issuer or Parent, and who shall be acceptable to the
Trustee. 

        "Original
Notes" has the meaning stated in the first recital of the Indenture. 

        "Outstanding",
when used with respect to Notes, means, as of the date of determination, all Notes theretofore authenticated and delivered under this Indenture, except: 

        (i)
Notes theretofore cancelled by the Trustee or delivered to the Trustee for cancellation; 

        (ii)
Notes, or portions thereof, for whose payment or redemption money in the necessary amount has been theretofore deposited with the Trustee or any Paying Agent (other than the Issuer)
in trust or set aside and segregated in trust by the Issuer (if the Issuer shall act as its own Paying Agent) for the Holders of such Notes; provided that, if such Notes
are to be redeemed, 

10

 

notice
of such redemption has been duly given pursuant to this Indenture or provision therefor satisfactory to the Trustee has been made; 

        (iii)
Notes, except to the extent provided in Sections 1402 and 1403, with respect to which the Issuer has effected defeasance and/or covenant defeasance as provided in Article Fourteen;
and 

        (iv)
Notes which have been paid pursuant to Section 308 or in exchange for or in lieu of which other Notes have been authenticated and delivered pursuant to the Indenture, other
than any such Notes in respect of which there shall have been presented to the Trustee proof satisfactory to it that such Notes are held by a bona fide purchaser in whose hands the Notes are valid
obligations of the Issuer whose determination shall be conclusive and evidenced by a Board Resolution; 

provided,
however, that in determining whether the Holders of the requisite principal amount of Outstanding Notes have given any request, demand, authorization, direction,
consent, notice or waiver hereunder, and for the purpose of making the calculations required by TIA Section 313, Notes owned by the Issuer or any other obligor upon the Notes or any Affiliate
of the Issuer or such other obligor shall be disregarded and deemed not to be Outstanding, except that, in determining whether the Trustee shall be protected in making such calculation or in relying
upon any such request, demand, authorization, direction, notice, consent or waiver, only Notes which the Trustee actually knows to be so owned shall be so disregarded. Notes so owned which have been
pledged in good faith may be regarded as Outstanding if the pledgee establishes to the satisfaction of the Trustee the pledgee's right so to act with respect to such Notes and that the pledgee is not
the Issuer or any other obligor upon the Notes or any Affiliate of the Issuer or such other obligor. 

        "Parent"
means the Person named as "Parent" in the first paragraph of this Indenture until a successor Person shall have become such pursuant to the applicable provisions of this
Indenture, and thereafter "Parent" shall mean such successor Persons. 

        "Parent
Guarantee" means the Guarantee of payment of the Notes by Parent pursuant to this Indenture. 

        "Parent
Indebtedness to Consolidated Cash Flow Ratio" has the meaning specified in Section 1011. 

        "Paying
Agent" means any Person (including the Issuer acting as Paying Agent) authorized by the Issuer to pay the principal of (and premium, if any) or interest on any Notes on behalf of
the Issuer. 

        "Payment
Account" has the meaning set forth in Section 402. 

        "Permitted
Business" means the business of (i) transmitting, or providing services, including consulting services, relating to the transmission of, voice, video or data through
owned or leased transmission facilities or through wireless or internet protocols and facilities, (ii) constructing, creating, developing or marketing communications related network equipment,
software and other devices for use in a telecommunications business or (iii) evaluating, participating or pursuing any other activity or opportunity that is primarily related to those
identified in clause (i) or (ii) above; provided that the determination of what constitutes a Permitted Business shall be made in good faith by the Board of
Directors of Parent, whose determination shall be conclusive and evidenced by a Board Resolution. 

        "Permitted
Investment" means (i) an Investment in a Restricted Subsidiary of Parent or a Person which will, upon the making of such Investment, become a Restricted Subsidiary of
Parent or be merged or consolidated with or into or transfer or convey all or substantially all its assets to, Parent or a Restricted Subsidiary of Parent; (ii) any Investment in Marketable
Securities; (iii) payroll, travel and similar advances to cover matters that are expected at the time of such advances ultimately to be treated as expenses in accordance with GAAP;
(iv) loans or advances to employees made in the ordinary course of business in accordance with past practice of Parent or its Restricted Subsidiaries and 

11

 

that
do not in the aggregate exceed $5.0 million at any time outstanding; (v) stock, obligations or securities received in satisfaction of judgments or received in connection with the
restructuring or workout of obligations of, or the bankruptcy of, suppliers, or customers, or received pursuant to a plan of reorganization of any supplier or customer in settlement of delinquent
obligations or disputes with customers or suppliers; (vi) any Investments arising under Currency Agreements and Interest Rate Agreements designed solely to protect Parent or any of its
Restricted Subsidiaries against fluctuations in foreign currency exchange rates or interest rates; (vii) any of the Notes; (viii) Investments in any Person or Persons received as
consideration for Asset Sales by Parent or any of its Restricted Subsidiaries to the extent permitted under Section 1017; (ix) Investments in any Person at any one time outstanding
(measured on the date each such Investment was made without giving effect to subsequent changes in value) in an aggregate amount not to exceed 10.0% of Parent' total consolidated assets; (x) an
Investment in no more than one entity identified in an Officer's Certificate delivered to the Trustee equal to the excess of (i) the Fair Market Value of the Voting Stock and other Investments
remaining in such entity upon the date it no longer constitutes a Restricted Subsidiary over (ii) the amount that would then be permitted to be made as a Restricted Payment or Permitted
Investment under Section 1012 and this definition of "Permitted Investments"; provided that the amount of such excess shall be included in calculating whether the conditions of
clause (C) of the first paragraph of Section 1012 have been met with respect to any subsequent Restricted Payments; and (xi) Investments existing on the Closing Date. 

        "Permitted
Liens" means (i) Liens for taxes, assessments, governmental charges or claims that are not yet delinquent that are being contested in good faith by appropriate legal
proceedings promptly instituted and diligently conducted and for which a reserve or other appropriate provision, if any, as shall be required in conformity with GAAP shall have been made;
(ii) statutory Liens of landlords and carriers, warehousemen, mechanics, suppliers, materialmen, repairmen or other similar Liens arising in the ordinary course of business and with respect to
amounts not yet delinquent or being contested in good faith by appropriate legal proceedings promptly instituted and diligently conducted and for which a reserve or other appropriate provision, if
any, as shall be required in conformity with GAAP shall have been made; (iii) Liens incurred or deposits made in the ordinary course of business in connection with workers' compensation,
unemployment insurance and other types of social security; (iv) Liens incurred or deposits made to secure the performance of tenders, bids, leases, trade contracts, statutory or regulatory
obligations, bankers' acceptances, surety and appeal bonds, government contracts, performance and return-of-money bonds and other obligations of a similar nature incurred in
the ordinary course of business (exclusive of obligations for the payment of borrowed money); (v) easements, rights-of-way, municipal and zoning and building ordinances
and similar charges, encumbrances, title defects or other irregularities, governmental restrictions on the use of property or conduct of business, and liens in favor of governmental authorities and
public utilities, that do not materially interfere with the ordinary course of business of Parent or any of its Restricted Subsidiaries, taken as a whole; (vi) Liens (including extensions and
renewals thereof) upon real or personal property purchased or leased after the Closing Date; provided that (a) such Lien is created solely for the purpose of
securing Indebtedness Incurred in compliance with Section 1011 (1) to finance the cost (including the cost of design, development, construction, acquisition, installation, improvement or
integration) of the item of property or assets subject thereto and such Lien is created prior to, at the time of or within six months after the later of the acquisition, the completion of construction
or the commencement of full operation of such property or (2) to refinance any Indebtedness previously so secured, (b) the principal amount of the Indebtedness secured by such Lien does
not exceed 100% of such cost and (c) any such Lien shall not extend to or cover any property or assets other than such item of property or assets and any improvements on such item;
(vii) leases or subleases granted to others that do not materially interfere with the ordinary course of business of Parent and its Restricted Subsidiaries, taken as a whole;
(viii) Liens encumbering property or assets under construction arising from progress or partial payments by a customer of Parent or its Restricted Subsidiaries relating to 

12

 

such
property or assets; (ix) any interest or title of a lessor in the property subject to any Capitalized Lease or operating lease; (x) Liens arising from filing Uniform Commercial Code
financing statements regarding leases; (xi) Liens on property of, or on shares of stock or Indebtedness of, any Person existing at the time such Person becomes, or becomes a part of, any
Restricted Subsidiary; provided that such Liens do not extend to or cover any property or assets of Parent or any Restricted Subsidiary other than the property or assets acquired and were not created
in contemplation of such transaction; (xii) Liens in favor of Parent or any Restricted Subsidiary; (xiii) Liens arising from the rendering of an interim or final judgment or order
against Parent or any Restricted Subsidiary of Parent that does not give rise to an Event of Default; (xiv) Liens securing reimbursement obligations with respect to letters of credit that
encumber documents and other property relating to such letters of credit; (xv) 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; (xvi) Liens encumbering customary initial deposits and margin deposits and other Liens that are either within the general parameters customary in
the industry or incurred in the ordinary course of business, in each case, securing Indebtedness under Interest Rate Agreements and Currency Agreements; (xvii) Liens arising out of conditional
sale, title retention, consignment or similar arrangements for the sale of goods entered into by Parent or any of its Restricted Subsidiaries in the ordinary course of business in accordance with past
practice of Parent
and its Restricted Subsidiaries prior to the Closing Date; (xviii) Liens existing on the Closing Date or securing the Notes or any Guarantee of the Notes and Liens on the Collateral equally and
ratably securing the October 1999 Senior Notes as and to the extent required by the indenture governing the October 1999 Senior Notes; (xix) Liens granted after the Closing Date
on any assets or Capital Stock of Parent or its Restricted Subsidiaries created in favor of the Holders; (xx) Liens securing Indebtedness which is incurred to refinance secured Indebtedness
which is permitted to be Incurred under clause (iv) of paragraph (b) of Section 1011; provided that such Liens do not extend to or cover any property or assets of Parent or any
Restricted Subsidiary of Parent other than the property or assets or, in the case of accounts receivables and inventories and to the extent covered by the terms of the Indebtedness being refinanced,
properties or assets of the same category as the property or assets, securing the Indebtedness being refinanced; (xxi) Liens on the property or assets of a Restricted Subsidiary of the Issuer
that is not a Guarantor securing Indebtedness of such Restricted Subsidiary which Indebtedness is permitted under this Indenture; (xxii) Liens securing Indebtedness under Credit Facilities
incurred in compliance with clauses (i) and (ii) of paragraph (b) of Section 1011; (xxiv) Liens securing Indebtedness incurred in connection with the construction,
installation or financing of pollution control or abatement facilities or other forms of industrial revenue bond financing, in each case to the extent such Liens are on the pollution control or
abatement facilities or other property being constructed, installed or financed; (xxv) Liens extending, renewing or replacing any of the foregoing Liens, provided
that the principal amount of Indebtedness or other obligation secured by such Lien is not increased or the maturity thereof shortened and such Lien is not extended to cover additional Indebtedness,
obligations or property (other than, in the case of accounts receivables and inventories, property of the same category to the extent the terms of the Lien being extended, renewed or replaced extended
to or covered such category of property); and (xxvi) Liens on any proceeds (including without limitation insurance, condemnation, eminent domain and analogous proceeds) or products of any
property or assets a Lien over which is a Permitted Lien as referred to in clauses (i) through (xxv) above. 

        "Person"
means any individual, corporation, partnership, joint venture, association, joint-stock company, trust unincorporated organization or government or any agency or political
subdivision thereof. 

        "Physical
Notes" has the meaning set forth in Section 201. 

        "Predecessor
Note" of any particular Note means every previous Note evidencing all or a portion of the same debt as that evidenced by such particular Note; and, for the purposes of this
definition, any 

13

 

Note
authenticated and delivered under Section 308 in exchange for a mutilated security or in lieu of a lost, destroyed or stolen Note shall be deemed to evidence the same debt as the
mutilated, lost, destroyed or stolen Note. 

        "Preferred
Stock" means, with respect to any Person, any and all shares, interests, participations or other equivalents (however designated, whether voting or non-voting) of
such Person's
preferred or preference stock, whether now outstanding or issued after the date of the Indenture, including, without limitation, all series and classes of such preferred or preference stock. 

        "Private
Placement Legend" has the meaning specified in Section 202. 

        "Pro
Forma Consolidated Cash Flow" means, with respect to an Obligor, for any period, the Consolidated Cash Flow of such Obligor for such period calculated on a pro forma basis to give
effect to any Asset Disposition or Asset Acquisition (including acquisitions of other Persons by merger, consolidation or purchase of Capital Stock) by such Obligor during such period as if such Asset
Disposition or Asset Acquisition had taken place on the first day of such period. 

        "Proportionate
Share" means, as of any date of calculation, an amount equal to (i) the outstanding principal amount of Notes as of such date, divided by (ii) the sum of the
outstanding principal amount of Notes as of such date plus the outstanding principal amount as of such date of all other Indebtedness (other than Subordinated Indebtedness) of the Issuer the terms of
which obligate the Issuer to make a purchase offer in connection with the relevant Excess Proceeds or the Asset Sale giving rise thereto and the terms of which provide for proration of the amount of
such Indebtedness to be purchased with Excess Proceeds. 

        "Purchase
Money Obligations" means, with respect to each Person, obligations, other than those under Capitalized Leases, Incurred or assumed in the ordinary course of business in
connection with the purchase of property to be used in the business of such Person. 

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

        "Redeemable
Stock" means any class or series of Capital Stock of any Person that by its terms or otherwise is (i) required to be redeemed prior to the Stated Maturity of the
Notes, (ii) redeemable at the option of the holder of such class or series of Capital Stock at any time prior to the Stated Maturity of the Notes or (iii) convertible into or
exchangeable for Capital Stock referred to in clause (i) or (ii) above or Indebtedness having a scheduled maturity prior to the Stated Maturity of the Notes;
provided that any Capital Stock that would not constitute Redeemable 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" occurring prior to the Stated Maturity of the Notes will not constitute Redeemable Stock if the "Asset Sale"
or "Change of Control" provisions applicable to such Capital Stock are no more favorable to the holders of such Capital Stock than the provisions contained in Sections 1017 and 1010 and such Capital
Stock specifically provides that such Person will not repurchase or redeem any such stock pursuant to such provision prior to the Issuer's repurchase of such Notes as are required to be repurchased
pursuant to Section 1017 and Section 1010. 

        "Redemption
Date", when used with respect to any Note to be redeemed, in whole or in part, means the date fixed for such redemption by or pursuant to this Indenture. 

        "Redemption
Price", when used with respect to any Note to be redeemed, means the price at which it is to be redeemed pursuant to this Indenture. 

        "Registration
Rights Agreement" means (i) the Registration Rights Agreement between the Issuer, Parent and the Initial Purchasers dated as of January 16, 2004, concerning
the registration and exchange of the Original Notes and (ii) any other similar Registration Rights Agreement relating to any Additional Notes. 

14

 

        "Registration
Statement" means a Registration Statement as defined in the Registration Rights Agreement. 

        "Regular
Record Date" for the interest payable on any Interest Payment Date means the January 1 or July 1 (whether or not a Business Day), as the case may be, next
preceding such Interest Payment Date. 

        "Regulation S"
means Regulation S under the Securities Act and any successor provision. 

        "Regulation S
Certificate" has the meaning specified in Section 307. 

        "Resale
Restriction Termination Date" has the meaning specified in Section 202. 

        "Responsible
Officer", when used with respect to the Trustee, means any vice president, any assistant vice president, any assistant treasurer, any trust officer, any assistant trust
officer, or any other officer of the Trustee customarily performing functions similar to those performed by any of the above-designated officers and having direct responsibility for the administration
of this Indenture, and also means, with respect to a particular corporate trust matter, any other officer to whom such matter is referred because of his knowledge of and familiarity with the
particular subject. 

        "Restricted
Payments" has the meaning specified in Section 1012. Any Restricted Payments made other than in cash shall be valued at Fair Market Value. 

        "Restricted
Subsidiary", with respect to any Obligor, means any Subsidiary of such Obligor (including, in the case of Parent, the Issuer) other than an Unrestricted Subsidiary. 

        "Rule 144A"
means Rule 144A under the Securities Act and any successor provision. 

        "Rule 144A
Certificate" has the meaning set forth in Section 307. 

        "Securities
Act" means the Securities Act of 1933, as amended. 

        "Shelf
Registration Statement" means a Shelf Registration Statement as defined in the Registration Rights Agreement. 

        "Significant
Subsidiary" means, at any date of determination, any Subsidiary of Parent that, together with such Subsidiary's Subsidiaries, (i) for the most recent fiscal year of
Parent, accounted for more than 10% of the consolidated revenues of Parent or (ii) as of the end of such fiscal year, was the owner of more than 10% of the consolidated assets of Parent, all as
set forth on the most recently available consolidated financial statements of Parent for such fiscal year. 

        "Special
Record Date" for the payment of any Defaulted Interest means a date fixed by the Trustee pursuant to Section 309. 

        "Stated
Maturity" means, (i) with respect to any debt security, the date specified in such debt security as the fixed date on which the final installment of principal of such debt
security is due and payable and (ii) with respect to any scheduled installment of principal of or interest on any debt security, the date specified in such debt security as the fixed date on
which such installment is due and payable. 

        "Subordinated
Indebtedness" means (i) with respect to the Issuer, Indebtedness of the Issuer subordinated in right of payment to the Notes and (ii) with respect to Parent,
Indebtedness of Parent subordinated in right of payment to the Parent Guarantee. 

        "Subsidiary"
means, with respect to any Person, any corporation, association or other business entity of which more than 50% of the outstanding Voting Stock is owned, directly or
indirectly, by such Person and one or more other Subsidiaries of such Person. 

15

 

        "Trade
Payables" means any accounts payable or any other indebtedness or monetary obligation to trade creditors created, assumed or Guaranteed by Parent or any of its Restricted
Subsidiaries arising in the ordinary course of business in connection with the acquisition of goods and services. 

        "Transaction
Date" means, with respect to the Incurrence of any Indebtedness by Parent or any of its Restricted Subsidiaries that is a Guarantor, the date such Indebtedness is to be
Incurred and, with respect to any Restricted Payment, the date such Restricted Payment is to be made. 

        "Trust
Indenture Act" or "TIA" means the Trust Indenture Act of 1939 as in force at the date as of which this Indenture was executed, except as provided in Section 905. 

        "Trustee"
means the Person named as the "Trustee" in the first paragraph of this Indenture until a successor Trustee shall have become such pursuant to the applicable provisions of this
Indenture, and thereafter "Trustee" shall mean such successor Trustee. 

        "Unclaimed
Excess Proceeds" means the amount of Excess Proceeds remaining immediately after the making of an Excess Proceeds Payment (exclusive of any Excess Proceeds not theretofore
subject to an Excess Proceeds Offer) in accordance with Section 1017. 

        "Uniform
Commercial Code" means the Uniform Commercial Code as in effect in New York State. 

        "Unrestricted
Subsidiary" means (i) any Subsidiary of Parent (other than the Issuer) that at the time of determination shall be designated an Unrestricted Subsidiary by the Board
of Directors in the manner provided below and (ii) any Subsidiary of an Unrestricted Subsidiary. The Board of Directors of Parent may designate any Restricted Subsidiary of Parent (including
any newly acquired or newly formed Subsidiary of Parent) other than the Issuer to be an Unrestricted Subsidiary unless such Subsidiary owns any Capital Stock of, or owns or holds any Lien on any
property of, Parent or any Restricted Subsidiary; provided that (A) either (I) the Subsidiary to be so designated has total assets of $1,000 or less or (II) if such Subsidiary has
assets greater than $1,000, that such designation would be permitted under Section 1012, and (B) such Subsidiary is not liable, directly or indirectly, with respect to any Indebtedness
other than Unrestricted Subsidiary Indebtedness. The Board of Directors of Parent may
designate any Unrestricted Subsidiary to be a Restricted Subsidiary of Parent; provided that immediately after giving effect to such designation (x) (1) in the case of Subsidiaries of Parent
that are not also Subsidiaries of the Issuer, Parent could Incur $1.00 of additional Indebtedness under clause (i) of paragraph (a) of Section 1011 and (2) in the case of
Subsidiaries of the Issuer, the Issuer could Incur $1.00 of additional Indebtedness under clause (ii) of paragraph (a) of Section 1011 and (y) no Default or Event of
Default shall have occurred and be continuing. Any such designation by the Board of Directors shall be evidenced to the Trustee by promptly filing with the Trustee a copy of the Board Resolution
giving effect to such designation and an Officer's Certificate certifying that such designation complied with the foregoing provisions. 

        "Unrestricted
Subsidiary Indebtedness" means Indebtedness of any Unrestricted Subsidiary (i) as to which neither Parent nor any Restricted Subsidiary is directly or indirectly
liable (by virtue of Parent or any such Restricted Subsidiary being the primary obligor on, guarantor of, or otherwise liable in any respect to, such Indebtedness), and (ii) which, upon the
occurrence of a default with respect thereto, does not result in, or permit any holder of any Indebtedness of Parent or any Restricted Subsidiary to declare, a default on such Indebtedness of Parent
or any Restricted Subsidiary or cause the payment thereof to be accelerated or payable prior to its Stated Maturity. 

        "U.S.
Global Note" has the meaning set forth in Section 201. 

        "U.S.
Government Obligations" has the meaning specified in Section 1404. 

        "U.S.
Physical Notes" has the meaning set forth in Section 201. 

16

   
        "Vice President", when used with respect to the Issuer or the Trustee, means any vice president, whether or not designated by a number or a word or words added before or after the title
"vice president". 

        "Voting
Stock" means with respect to any Person, Capital Stock of any class or kind ordinarily having the power to vote for the election of directors, managers or other voting members of
the governing body of such Person. 

        SECTION
102. Incorporation by Reference of Trust Indenture Act. 

        Whenever
this Indenture refers to a provision of the Trust Indenture Act, the provision is incorporated by reference in and made a part of this Indenture. The following Trust Indenture
Act terms used in this Indenture have the following meanings: 

        "indenture
notes" means the Notes; 

        "indenture
note holder" means a Holder; 

        "indenture
to be qualified" means this Indenture; 

        "indenture
trustee" or "institutional trustee" means the Trustee; and 

        "obligor"
on the indenture notes means the Issuer, Parent or any other obligor on the Notes. 

        All
other Trust Indenture Act terms used in this Indenture that are defined by the Trust Indenture Act, defined by reference in the Trust Indenture Act to another statute or defined by a
rule of the Commission and not otherwise defined herein shall have the meanings assigned to them therein. 

        SECTION
103. Compliance Certificates and Opinions. 

        Upon
any application or request by the Issuer to the Trustee to take any action under any provision of this Indenture, the Issuer shall furnish to the Trustee an Officer's Certificate
stating that all conditions precedent, if any, provided for in this Indenture (including any covenant compliance with which constitutes a condition precedent) relating to the proposed action have been
complied with and an Opinion of Counsel stating that in the opinion of such counsel all such conditions precedent, if any, have been complied with, except that in the case of any such application or
request as to which the furnishing of such documents is specifically required by any provision of this Indenture relating to such particular application or request, no additional certificate or
opinion need be furnished. 

        Every
certificate or opinion with respect to compliance with a condition or covenant provided for in this Indenture (other than pursuant to Section 1008(a)) shall include: 

        (1)   a
statement that each individual signing such certificate or opinion has read such covenant or condition and the definitions herein relating thereto; 

        (2)   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; 

        (3)   a
statement that, in the opinion of each such individual, he or she has made such examination or investigation as is necessary to enable him or her to express an
informed opinion as to whether or not such covenant or condition has been complied with; and 

        (4)   a
statement as to whether, in the opinion of each such individual, such condition or covenant has been complied with. 

        SECTION
104. Form of Documents Delivered to Trustee. 

        In
any case where several matters are required to be certified by, or covered by an opinion of, any specified Person, it is not necessary that all such matters be certified by, or
covered by the opinion of, only one such Person, or that they be so certified or covered by only one document, but one such 

17

 

Person
may certify or give an opinion with respect to some matters and one or more other such Persons as to other matters, and any such Person may certify or give an opinion as to such matters in one
or several documents. 

        Any
certificate or opinion of an officer of the Issuer or Parent may be based, insofar as it relates to legal matters, upon a certificate or opinion of, or representations by, counsel,
unless such officer knows, or in the exercise of reasonable care should know, that the certificate or opinion or representations with respect to the matters upon which his certificate or opinion is
based are erroneous. Any such certificate or Opinion of Counsel may be based, insofar as it relates to factual matters, upon a certificate or opinion of, or representations by, an officer or officers
of the Issuer or Parent stating that the information with respect to such factual matters is in the possession of the Issuer or Parent, as applicable, unless such counsel knows, or in the exercise of
reasonable care should know, that the certificate or opinion or representations with respect to such matters are erroneous. 

        Where
any Person is required to make, give or execute two or more applications, requests, consents, certificates, statements, opinions or other instruments under this Indenture, they
may, but need not, be consolidated and form one instrument. 

        SECTION
105. Acts of Holders. 

        (a)   Any
request, demand, authorization, direction, notice, consent, waiver or other action provided by this Indenture to be given or taken by Holders may be embodied in and
evidenced by one or more instruments of substantially similar tenor signed by such Holders in person or by agents duly appointed in writing; and, except as herein otherwise expressly provided, such
action shall become effective when such instrument or instruments are delivered to the Trustee and, where it is hereby expressly required, to the Issuer or Parent. Such instrument or instruments (and
the action embodied therein and evidenced thereby) are herein sometimes referred to as the "Act" of the Holders signing such instrument or instruments. Proof of execution of any such instrument or of
a writing appointing any such agent shall be sufficient for any purpose of this Indenture and conclusive in favor of the Trustee, the Issuer and Parent, if made in the manner provided in this Section. 

        (b)   The
fact and date of the execution by any Person of any such instrument or writing may be proved by the affidavit of a witness of such execution or by a certificate of a
notary public or other officer authorized by law to take acknowledgments of deeds, certifying that the individual signing such instrument or writing acknowledged to him the execution thereof. Where
such execution is by a signer acting in a capacity other than his individual capacity, such certificate or affidavit shall also constitute sufficient proof of authority. The fact and date of the
execution of any such instrument or writing, or the authority of the Person executing the same, may also be proved in any other manner that the Trustee deems sufficient. 

        (c)   The
principal amount and serial numbers of Notes held by any Person, and the date of holding the same, shall be proved by the Note Register. 

        (d)   If
the Issuer or Parent shall solicit from the Holders of Notes any request, demand, authorization, direction, notice, consent, waiver or other Act, such Obligor may, at
its option, by or pursuant to a Board Resolution, fix in advance a record date for the determination of Holders entitled to give such request, demand, authorization, direction, notice, consent, waiver
or other Act, but such Obligor shall have no obligation to do so. Notwithstanding TIA Section 316(c), such record date shall be the record date specified in or pursuant to such Board
Resolution, which shall be a date not earlier than the date 30 days prior to the first solicitation of Holders generally in connection therewith and not later than the date such solicitation is
completed. If such a record date is fixed, such request, demand, authorization, direction, notice, consent, waiver or other Act may be given before or after such record date, but only the Holders of
record at the close of business on such record date shall be deemed to be Holders for the purposes of determining whether Holders of the requisite proportion of Outstanding 

18

 

Notes
have authorized or agreed or consented to such request, demand, authorization, direction, notice, consent, waiver or other Act, and for that purpose the Outstanding Notes shall be computed as of
such record date; provided that no such authorization, agreement or consent by the Holders on such record date shall be deemed effective unless it shall become effective
pursuant to the provisions of this Indenture not later than eleven months after the record date. 

        (e)   Any
request, demand, authorization, direction, notice, consent, waiver or other Act of the Holder of any Note shall bind every future Holder of the same Note and the
Holder of every Note issued upon the registration of transfer thereof or in exchange therefor or in lieu thereof in respect of anything done, omitted or suffered to be done by the Trustee or the
Issuer in reliance thereon, whether or not notation of such action is made upon such Note. 

        SECTION
106. Notices, Etc. to Trustee, Obligors. 

        Any
request, demand, authorization, direction, notice, consent, waiver or Act of Holders or other document provided or permitted by this Indenture to be made upon, given or furnished to,
or filed with, 

        (1)   the
Trustee by any Holder or by an Obligor shall be sufficient for every purpose hereunder if made, given, furnished or filed in writing to or with the Trustee at its
Corporate Trust Office, or 

        (2)   an
Obligor shall be sufficient for every purpose hereunder (unless otherwise herein expressly provided) if in writing and mailed, first-class postage prepaid, to the
such Obligor addressed to it at 1700 Old Meadow Road, McLean, Virginia 22102, or at any other address previously furnished in writing to the Trustee by the Issuer. 

        SECTION
107. Notice to Holders; Waiver. 

        Where
this Indenture provides for notice of any event to Holders by the Issuer, Parent or the Trustee, such notice shall be sufficiently given (unless otherwise herein expressly
provided) if in writing and mailed, first-class postage prepaid, to each Holder affected by such event, at his or her address as it appears in the Note Register, not later than the latest date, and
not earlier than the earliest date, prescribed for the giving of such notice. In any case where notice to Holders is given by mail, neither the failure to mail such notice, nor any defect in any
notice so mailed, to any particular Holder shall affect the sufficiency of such notice with respect to other Holders. Any notice mailed to a Holder in the manner herein prescribed shall be
conclusively deemed to have been received by such Holder, whether or not such Holder actually receives such notice. Where this Indenture provides for notice in any manner, such notice may be waived in
writing by the Person entitled to receive such notice, either before or after the event, and such waiver shall be the equivalent of such notice. Waivers of notice by Holders shall be filed with the
Trustee, but such filing shall not be a condition precedent to the validity of any action taken in reliance upon such waiver. 

        In
case by reason of the suspension of or irregularities in regular mail service or by reason of any other cause, it shall be impracticable to mail notice of any event to Holders when
such notice is required to be given pursuant to any provision of this Indenture, then any manner of giving such notice as shall be satisfactory to the Trustee shall be deemed to be a sufficient giving
of such notice for every purpose hereunder. 

        SECTION
108. Effect of Headings and Table of Contents. 

        The
Article and Section headings herein and the Table of Contents are for convenience only and shall not affect the construction hereof. 

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        SECTION
109. Successors and Assigns. 

        All
covenants and agreements in this Indenture by an Obligor shall bind its successors and assigns, whether so expressed or not. 

        SECTION
110. Separability Clause. 

        In
case any provision in this Indenture or in the Notes shall be invalid, illegal or unenforceable, the validity, legality and enforceability of the remaining provisions shall not in any
way be affected or impaired thereby. 

        SECTION
111. Benefits of Indenture. 

        Nothing
in this Indenture or in the Notes, express or implied, shall give to any Person, other than the parties hereto, any Paying Agent, any Note Registrar and their successors
hereunder, and the Holders, any benefit or any legal or equitable right, remedy or claim under this Indenture. 

        SECTION
112. Governing Law. 

        This
Indenture and the Notes shall be governed by and construed in accordance with the law of the State of New York. Upon the issuance of Exchange Notes, if any, or the effectiveness of
the Shelf Registration Statement, this Indenture will be subject to the provisions of the Trust Indenture Act that are required to be part of this Indenture and shall, to the extent applicable, be
governed by such provisions. Each of the parties hereto submits to the jurisdiction of the U.S. federal and any New York state court located in the Borough of Manhattan, City and State of New York
with respect to any actions brought against it as defendant in any suit, action or proceeding arising out of or relative to this Indenture or the Notes and waives any rights to which it may be
entitled on account of place of residence or domicile. 

        SECTION
113. Legal Holidays. 

        In
any case where any Interest Payment Date, Redemption Date, sinking fund payment date or Stated Maturity or Maturity of any Note shall not be a Business Day, then (notwithstanding any
other provision of this Indenture or of the Notes) payment of principal (or premium, if any) or interest need not be made on such date, but may be made on the next succeeding Business Day with the
same force and effect as if made on the Interest Payment Date, Redemption Date or sinking fund payment date, or at the Stated Maturity or Maturity; provided that no
interest shall accrue for the period from and after such Interest Payment Date, Redemption Date, sinking fund payment date, Stated Maturity or Maturity, as the case may be. 

ARTICLE TWO  

 NOTE FORMS  

        SECTION 201. Forms Generally. 

        The
Notes and the Trustee's certificate of authentication shall be in substantially the form annexed hereto as Exhibit A. The Notes may have such appropriate insertions,
omissions, substitutions and other variations as are required or permitted by this Indenture and may have such letters, numbers or other marks of identification and such notations, legends or
endorsements as may be required by law, or to comply with the rules of any securities exchange or agreements to which the Issuer is subject or as may, consistently herewith, be determined by the
officers executing such Notes, as evidenced by their execution of the Notes. Any portion of the text of any Note may be set forth on the reverse thereof, with an appropriate reference thereto on the
face of the Note. The Issuer shall approve the form of the Notes and any notation, legend or endorsement on the Notes. 

        The
terms and provisions contained in the form of the Notes annexed hereto as Exhibit A shall constitute, and are hereby expressly made, a part of this Indenture. To the extent
applicable, the Issuer, 

20

 

Parent
and the Trustee, by their execution and delivery of this Indenture, expressly agree to such terms and provisions and to be bound thereby. 

        Initial
Notes offered and sold in reliance on Rule 144A shall be issued initially in the form of one or more permanent global Notes in registered form, substantially in the form
set forth in Exhibit A and
contain each of the legends set forth in Section 202 (the "U.S. Global Note"), registered in the name of the Depositary or the nominee of the Depositary, deposited with the Trustee, as
custodian for the Depositary, duly executed by the Issuer and authenticated by the Trustee as hereinafter provided. The aggregate principal amount of the U.S. Global Note may from time to time be
increased or decreased by adjustments made on the records of the Trustee, as custodian for the Depositary or its nominee, or on the Schedule of Increases or Decreases of Global Note attached thereto,
as hereinafter provided. 

        Initial
Notes offered and sold in offshore transactions in reliance on Regulation S shall be issued initially in the form of a single permanent global Note in registered form,
substantially in the form set forth in Exhibit A (the "Offshore Global Note"), registered in the name of the Depositary or the nominee of the Depositary, deposited with the Trustee, as
custodian for the Depositary or its nominee, duly executed by the Issuer and authenticated by the Trustee as hereinafter provided. The aggregate principal amount of the Offshore Global Note may from
time to time be increased or decreased by adjustments made in the records of the Trustee, as custodian for the Depositary or its nominee, or on the Schedule of Increases or Decreases of Global Note
attached thereto, as herein provided. Initial Notes issued pursuant to Section 305 in exchange for or upon transfer of beneficial interests in the U.S. Global Note or the Offshore Global Note
shall be in the form of U.S. Physical Notes or in the form of permanent certificated Notes substantially in the form set forth in Exhibit A (the "Offshore Physical Notes"), respectively as
hereinafter provided. 

        Initial
Notes offered and sold other than as described in the preceding two paragraphs shall be issued in the form of permanent certificated Notes in registered form substantially in the
form set forth in Exhibit A and, unless sold in a transaction registered under the Securities Act, contain the Private Placement Legend as set forth in Section 202(a)(i) (the
"U.S. Physical Notes"). 

        The
Offshore Physical Notes and U.S. Physical Notes are sometimes collectively herein referred to as the "Physical Notes". The U.S. Global Note and the Offshore Global Note are sometimes
collectively referred to as the "Global Notes". 

        The
definitive Notes shall be printed, lithographed or engraved on steel-engraved borders or may be produced in any other manner, all as determined by the officers of the Issuer
executing such Notes, as evidenced by their execution of such Notes. 

        Exchange
Notes shall be substantially in the form set forth in Exhibit A. 

        SECTION
202. Restrictive Legends. 

        (a)   Unless
and until (x) an Initial Note is sold pursuant to an effective Shelf Registration Statement or (y) an Initial Note is exchanged for an Exchange Note
in an Exchange Offer pursuant to an effective Exchange Offer Registration Statement, in each case pursuant to the Registration Rights Agreement, (A) the U.S. Global Note and each U.S. Physical
Note shall bear the following legends (the "Private Placement Legend") on the face thereof and (B) the Offshore Physical Notes and the Offshore Global Note shall bear the Private Placement
Legend on the face thereof until at least 41 days after the date hereof (the "Offshore Notes Exchange Date") and receipt by the Trustee of a certificate substantially in the form of
Exhibit B hereto: 

        (i)    THE
NOTES EVIDENCED HEREBY HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED (THE "SECURITIES ACT"), OR OTHER SECURITIES LAWS. NEITHER THIS NOTE NOR
ANY INTEREST OR PARTICIPATION HEREIN MAY BE RE-OFFERED, SOLD, ASSIGNED, TRANSFERRED, PLEDGED, 

21

 

ENCUMBERED
OR OTHERWISE DISPOSED OF IN THE ABSENCE OF SUCH REGISTRATION OR UNLESS THE TRANSACTION IS EXEMPT FROM, OR NOT SUBJECT TO, THE REGISTRATION REQUIREMENTS OF THE SECURITIES ACT. EACH PURCHASER
OF THE SECURITY EVIDENCED HEREBY IS HEREBY NOTIFIED THAT THE SELLER MAY BE RELYING ON THE EXEMPTION FROM THE PROVISIONS OF SECTION 5 OF THE SECURITIES ACT PROVIDED BY RULE 144A THEREUNDER. THE HOLDER
OF THIS SECURITY BY ITS ACCEPTANCE HEREOF (1) REPRESENTS THAT (A) IT IS A "QUALIFIED INSTITUTIONAL BUYER" (AS DEFINED IN RULE 144A UNDER THE SECURITIES ACT ("RULE 144A")) OR
(B) IT IS NOT A U.S. PERSON AND IS ACQUIRING THIS NOTE IN AN "OFFSHORE TRANSACTION" PURSUANT TO RULE 903 OR 904 OF REGULATION S UNDER THE SECURITIES ACT, (2) AGREES THAT IT WILL NOT
PRIOR TO (X) THE DATE WHICH IS TWO YEARS (OR SUCH SHORTER PERIOD OF TIME AS PERMITTED BY RULE 144(k) UNDER THE SECURITIES ACT OR ANY SUCCESSOR PROVISION THEREUNDER) AFTER THE LATER OF THE
ORIGINAL ISSUE DATE HEREOF (OR OF ANY PREDECESSOR OF THIS NOTE) OR THE LAST DAY ON WHICH PRIMUS TELECOMMUNICATIONS HOLDING, INC. (THE "ISSUER") OR ANY AFFILIATE OF THE ISSUER WAS THE OWNER OF
THIS NOTE (OR ANY PREDECESSOR OF THIS NOTE) AND (Y) SUCH LATER DATE, IF ANY, AS MAY BE REQUIRED BY APPLICABLE LAW (THE "RESALE RESTRICTION TERMINATION DATE"), OFFER, SELL OR OTHERWISE TRANSFER
THIS NOTE EXCEPT (A) TO THE ISSUER, (B) PURSUANT TO A REGISTRATION STATEMENT WHICH HAS BEEN DECLARED EFFECTIVE UNDER THE SECURITIES ACT, (C) FOR SO LONG AS THE NOTES ARE ELIGIBLE
FOR RESALE PURSUANT TO RULE 144A, TO A PERSON IT REASONABLY BELIEVES IS A "QUALIFIED INSTITUTIONAL BUYER" (AS DEFINED IN RULE 144A) 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 TO NON-U.S. PERSONS THAT OCCUR OUTSIDE THE
UNITED STATES WITHIN THE MEANING OF REGULATION S UNDER THE SECURITIES ACT OR (E) PURSUANT TO ANOTHER AVAILABLE EXEMPTION FROM THE REGISTRATION REQUIREMENTS OF THE SECURITIES ACT AND
(3) AGREES THAT IT WILL GIVE TO EACH PERSON TO WHOM THIS NOTE IS TRANSFERRED A NOTICE SUBSTANTIALLY TO THE EFFECT OF THIS LEGEND; PROVIDED THAT THE ISSUER, THE
TRUSTEE, AND THE REGISTRAR SHALL HAVE THE RIGHT PRIOR TO ANY SUCH OFFER, SALE OR TRANSFER (I) PURSUANT TO CLAUSE (E) TO REQUIRE THE DELIVERY OF AN OPINION OF COUNSEL, CERTIFICATION
AND/OR OTHER INFORMATION SATISFACTORY TO EACH OF THEM, AND (II) IN EACH OF THE FOREGOING CASES, TO REQUIRE THAT A CERTIFICATION OF TRANSFER IN THE FORM APPEARING ON THE OTHER SIDE OF THIS NOTE
IS COMPLETED AND DELIVERED BY THE TRANSFEROR TO THE TRUSTEE. THIS LEGEND WILL BE REMOVED UPON THE REQUEST OF THE HOLDER AFTER THE RESALE RESTRICTION TERMINATION DATE. AS USED HEREIN, THE TERMS
"OFFSHORE TRANSACTION," "UNITED STATES" AND "U.S. PERSON" HAVE THE RESPECTIVE MEANINGS GIVEN TO THEM BY REGULATION S UNDER THE SECURITIES ACT. 

        (b)   Each
Global Note, whether or not an Initial Note, shall also bear the following legend on the face thereof: 

UNLESS
THIS CERTIFICATE IS PRESENTED BY AN AUTHORIZED REPRESENTATIVE OF THE DEPOSITORY TRUST COMPANY, A NEW YORK CORPORATION ("DTC"), TO THE ISSUER OR ITS AGENT FOR REGISTRATION OF TRANSFER, EXCHANGE
OR PAYMENT, AND ANY CERTIFICATE ISSUED IS REGISTERED IN THE NAME OF 

22

 

CEDE &
CO. OR IN 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 NOTE SHALL BE LIMITED TO TRANSFERS IN WHOLE, BUT NOT IN PART, TO NOMINEES OF CEDE & CO. OR TO A SUCCESSOR THEREOF OR SUCH SUCCESSOR'S NOMINEE AND TRANSFERS OF PORTIONS
OF THIS GLOBAL NOTE SHALL BE LIMITED TO TRANSFERS MADE IN ACCORDANCE WITH THE RESTRICTIONS SET FORTH IN SECTIONS 306 AND 307 OF THE INDENTURE. 

ARTICLE THREE  

 THE NOTES  

        SECTION 301. Titles and Terms. 

        The
aggregate principal amount of Notes to be authenticated and delivered under this Indenture on the Closing Date shall be $240,000,000. The aggregate principal amount of Notes which
may be authenticated and delivered under this Indenture is unlimited, subject to the conditions set forth herein and to compliance with Section 1011. 

        With
respect to any Additional Notes issued after the Closing Date (except for Notes authenticated and delivered upon registration of transfer of, or in exchange for, or in lieu of,
other Notes pursuant to Section 303, 304, 305, 308, 906, 1010, 1017 or 1108), there shall be (i) established in or pursuant to a Board Resolution of the Issuer and
(ii) (A) set forth or determined in the manner provided in an
Officer's Certificate of the Issuer or (B) established in one or more indentures supplemental hereto, prior to the issuance of such Additional Notes: 

        (1)
the aggregate principal amount of such Additional Notes which may be authenticated or delivered under this Indenture; 

        (2)
the issue price and issuance date of such Additional Notes, including the date from which interest on such Additional Notes shall accrue; 

        (3)
whether the CUSIP number for such Additional Notes shall be the same as that for the Notes issued on the date hereof; 

        (4)
whether such Additional Notes shall be deemed to be of the same series as the Notes issued on the date hereof; 

        (5)
if applicable, that such Additional Notes shall be issuable in whole or in part in the form of one or more Global Notes and, in such case, the respective depositaries for such Global
Notes, the form of any legend or legends which shall be borne by such Global Notes in addition to or in lieu of those set forth in Section 202 and any circumstances in addition to or in lieu of
those set forth in Section 307 under which any such Global Notes may be exchanged in whole or in part for Additional Notes registered, or any transfer of such Global Notes in whole or in part
may be registered, in the name or names of Persons other than the depositary for such Global Notes or a nominee thereof; and 

        (6)
if applicable, that such Additional Notes shall not be issued in the form of Initial Notes, but shall be issued in the form of Exchange Notes. 

        If
any of the terms of any Additional Notes are established by action taken by a Board Resolution, a copy of the appropriate record of such action shall be certified by the Secretary or
an Assistant Secretary of the Issuer and delivered to the Trustee at or prior to the delivery of the Officer's Certificate or any indenture supplemental hereto setting forth the terms of such
Additional Notes. 

23

   
        The Initial Notes shall be known as the "8% Senior Notes Due 2014" and the Exchange Notes shall be known as the "8% Series B Senior Notes Due 2014," in each case, of the Issuer.
The Stated Maturity of the Notes shall be January 15, 2014, and the Notes shall bear interest at the rate of 8% per annum from the Issuance Date, or from the most recent Interest Payment Date
to which interest has been paid or duly provided for, payable on July 15, 2004 and semi-annually thereafter on January 15, 2004 and July 15, 2004 in each year and at
said Stated Maturity, until the principal thereof is paid or duly provided for. 

        With
respect to Global Notes only, if a Holder has given wire instructions to the Issuer, the Issuer will pay all principal of (and premium and Additional Interest, if any) and interest
on such Holder's Notes in accordance with those instructions. Otherwise, the principal of (and premium and Additional Interest, if any) and interest on the Notes shall be payable at the office or
agency of the Issuer maintained for such purpose in The City of New York, or at such other office or agency of the Issuer as may be maintained for such purpose; provided,
however, that, at the option of the Issuer, interest may be paid by check mailed to addresses of the Persons entitled thereto as such addresses shall appear on the Note
Register. 

        The
Notes shall be redeemable as provided in Article Eleven. 

        SECTION
302. Denominations. 

        The
Notes shall be issuable only in registered form without coupons and only in denominations of $1,000 and any integral multiple thereof; provided that
Notes issued to a Holder that delivers an Accredited Investor Certificate pursuant to Section 307 shall be issuable only in registered form without coupons and only in denominations of $250,000
and any integral multiple of $1,000 in excess thereof. 

        SECTION
303. Execution, Authentication, Delivery and Dating. 

        The
Notes shall be executed on behalf of the Issuer by its Chairman, its President or a Vice President, and attested by its Secretary, an Assistant Secretary or any Vice President. The
signature of any of these officers on the Notes may be manual or facsimile signatures of the present or any future such authorized officer and may be imprinted or otherwise reproduced on the Notes. 

        Notes
bearing the manual or facsimile signatures of individuals who were at any time the proper officers of the Issuer shall bind the Issuer, notwithstanding that such individuals or any
of them have ceased to hold such offices prior to the authentication and delivery of such Notes or did not hold such offices at the date of such Notes. 

        At
any time and from time to time after the execution and delivery of this Indenture, the Issuer may deliver Notes executed by the Issuer to the Trustee for authentication, together with
an Issuer Order for the authentication and delivery of such Notes, and the Trustee in accordance with such Issuer Order shall authenticate and deliver such Notes. 

        At
any time and from time to time after the execution and delivery of this Indenture, the Issuer may deliver Initial Notes executed by the Issuer to the Trustee for authentication,
together with an Issuer Order for the authentication and delivery of such Initial Notes directing the Trustee to authenticate the Notes and certifying that all conditions precedent to the issuance of
Notes contained herein have been fully complied with, and the Trustee in accordance with such Issuer Order shall authenticate and deliver such Initial Notes. On Issuer Order, the Trustee shall
authenticate for original issue Exchange Notes; provided that such Exchange Notes shall be issuable only upon the valid surrender for cancellation of Initial Notes of a
like aggregate principal amount in accordance with an Exchange Offer pursuant to the Registration Rights Agreement and an Issuer Order for the authentication of such securities certifying that all
conditions precedent to the issuance have been complied with (including the effectiveness of a registration statement related thereto). In each case, the Trustee shall be entitled to receive an
Officer's Certificate and an Opinion of Counsel of the Issuer that 

24

 

it
may reasonably request in connection with such authentication of Notes. Such order shall specify the amount of Notes to be authenticated and the date on which the original issue of Initial Notes or
Exchange Notes is to be authenticated. 

        Each
Note shall be dated the date of its authentication. 

        No
Note shall be entitled to any benefit under this Indenture or be valid or obligatory for any purpose unless there appears on such Note a certificate of authentication
substantially in the form provided for in Exhibit A, duly executed by the Trustee by manual signature of an authorized officer, and such certificate upon any Note shall be conclusive evidence,
and the only evidence, that such Note has been duly authenticated and delivered hereunder and is entitled to the benefits of this Indenture. 

        In
case the Issuer, pursuant to Article Eight, shall be consolidated or merged with or into any other Person or shall convey, transfer, lease or otherwise dispose of its properties and
assets substantially as an entirety to any Person, and the successor Person resulting from such consolidation, or surviving such merger, or into which the Issuer shall have been merged, or the Person
which shall have received a
conveyance, transfer, lease or other disposition as aforesaid, shall have executed an indenture supplemental hereto with the Trustee pursuant to Article Eight, any of the Notes authenticated or
delivered prior to such consolidation, merger, conveyance, transfer, lease or other disposition may, from time to time, at the request of the successor Person, be exchanged for other Notes executed in
the name of the successor Person with such changes in phraseology and form as may be appropriate, but otherwise in substance of like tenor as the Notes surrendered for such exchange and of like
principal amount; and the Trustee, upon Issuer Request of the successor Person, shall authenticate and deliver Notes as specified in such request for the purpose of such exchange. If Notes shall at
any time be authenticated and delivered in any new name of a successor Person pursuant to this Section in exchange or substitution for or upon registration of transfer of any Notes, such successor
Person, at the option of the Holders but without expense to them, shall provide for the exchange of all Notes at the time Outstanding for Notes authenticated and delivered in such new name. 

        SECTION
304. Temporary Note. 

        Pending
the preparation of definitive Notes, the Issuer may execute, and upon Issuer Order the Trustee shall authenticate and deliver, temporary Notes which are printed, lithographed,
typewritten, mimeographed or otherwise produced, in any authorized denomination, substantially of the tenor of the definitive Notes in lieu of which they are issued and with such appropriate
insertions, omissions, substitutions and other variations as the officers executing such Notes may determine, as conclusively evidenced by their execution of such Notes. 

        If
temporary Notes are issued, the Issuer will cause definitive Notes to be prepared without unreasonable delay. After the preparation of definitive Notes, the temporary Notes shall be
exchangeable for definitive Notes upon surrender of the temporary Notes at the office or agency of the Issuer designated for such purpose pursuant to Section 1002, without charge to the Holder.
Upon surrender for cancellation of any one or more temporary Notes, the Issuer shall execute and upon Issuer Order the Trustee shall authenticate and deliver in exchange therefor a like principal
amount of definitive Notes of authorized denominations. Until so exchanged, the temporary Notes shall in all respects be entitled to the same benefits under this Indenture as definitive Notes. 

        SECTION
305. Registration, Registration of Transfer and Exchange. 

        The
Issuer shall cause to be kept at the Corporate Trust Office of the Trustee a register (the register maintained in such office and in any other office or agency designated pursuant to
Section 1002 being herein sometimes referred to as the "Note Register") in which, subject to such reasonable regulations as it may prescribe, the Issuer shall provide for the registration of
Notes and of transfers of Notes. The Note Register shall be in written form or any other form capable of being converted into written form within a reasonable time. At all reasonable times, the Note
Register shall 

25

 

be
open to inspection by the Trustee. The Trustee is hereby initially appointed as security registrar (the "Note Registrar") for the purpose of registering Notes and transfers of Notes as herein
provided. 

        Upon
surrender for registration of transfer of any Note at the office or agency of the Issuer designated pursuant to Section 1002, the Issuer shall execute, and upon Issuer Order
the Trustee shall authenticate and deliver, in the name of the designated transferee or transferees, one or more new Notes of any authorized denomination or denominations of a like aggregate principal
amount. 

        At
the option of the Holder, Notes may be exchanged for other Notes of any authorized denomination and of a like aggregate principal amount, upon surrender of the Notes to be exchanged
at such office or agency. Whenever any Notes are so surrendered for exchange, the Issuer shall execute, and upon Issuer Order the Trustee shall authenticate and deliver, the Notes which the Holder
making the exchange is entitled to receive; provided that no exchange of Initial Notes for Exchange Notes shall occur until an Exchange Offer Registration Statement shall
have been declared effective by the Commission, the Trustee shall have received an Officer's Certificate from the Issuer confirming that the Exchange Offer Registration Statement has been declared
effective by the Commission and that the Initial Notes to be exchanged for the Exchange Notes shall be canceled by the Trustee. 

        All
Notes issued upon any registration of transfer or exchange of Notes shall be the valid obligations of the Issuer, evidencing the same debt, and entitled to the same benefits under
this Indenture, as the Notes surrendered upon such registration of transfer or exchange. 

        Every
Note presented or surrendered for registration of transfer or for exchange shall be duly endorsed and be accompanied by a written instrument of transfer, in form satisfactory to
the Issuer and the Note Registrar, duly executed by the Holder thereof or his attorney duly authorized in writing. 

        No
service charge shall be made for any registration of transfer or exchange or redemption of Notes, but the Issuer may require payment of a sum sufficient to cover any tax or other
governmental charge that may be imposed in connection with any registration of transfer or exchange of Notes, other than exchanges pursuant to Section 304, 906, 1010, 1017 or 1108 not involving
any transfer. 

        The
Issuer shall not be required (i) to issue, register the transfer of or exchange any Note during a period beginning at the opening of business 15 days before the
selection of Notes to be redeemed under Section 1104 and ending at the close of business on the day of such mailing of the relevant notice of redemption, or (ii) to register the transfer
of or exchange any Note so selected for redemption in whole or in part, except the unredeemed portion of any Note being redeemed in part. 

        SECTION
306. Book-Entry Provisions for Global Notes. 

        (a)   Each
Global Note initially shall (i) be registered in the name of the Depositary for such Global Note or the nominee of such Depositary, (ii) be delivered
to the Trustee as custodian for such Depositary and (iii) bear legends as set forth in Section 202. 

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

        (b)   Transfers
of a Global Note shall be limited to transfers of such Global Note in whole, but not in part, to the Depositary, its successors or their respective nominees,
except (i) as otherwise set forth in Section 307 and (ii) U.S. Physical Notes or Offshore Physical Notes shall be transferred to all 

26

 

beneficial
owners in exchange for their beneficial interests in the U.S. Global Note or the Offshore Global Note, respectively, in the event that (A) the Depositary notifies the Issuer that it
is unwilling or unable to continue as Depositary for the applicable Global Note or the Depositary ceases to be a "Clearing Agency" registered under the Exchange Act and a successor depositary is not
appointed by the Issuer within 90 days or (B) the Issuer, at its option, notifies the Trustee that it elects to cause issuance of the Notes in the form of permanent certificated Notes.
Interests of beneficial owners in a Global Note may be transferred in accordance with the rules and procedures of the Depositary and the provisions of Section 307. In connection with the
transfer of an entire Global Note to beneficial owners pursuant to clause (ii) of this paragraph (b), the applicable Global Note shall be deemed to be surrendered to the Trustee for
cancellation, and the Issuer shall execute, and the Trustee shall authenticate and deliver, to each beneficial owner identified by the Depositary in exchange for its beneficial interest in the
applicable Global Note, an equal aggregate principal amount at maturity of U.S. Physical Notes (in the case of the U.S. Global Note) or Offshore Physical Notes (in the case of the Offshore Global
Note), as the case may be, of authorized denominations. 

        (c)   Any
beneficial interest in one of the Global Notes that is transferred to a Person who takes delivery in the form of an interest in the other Global Note will, upon
transfer, cease to be an interest in such Global Note and become an interest in the other Global Note and, accordingly, will thereafter be subject to all transfer restrictions, if any, and other
procedures applicable to beneficial interests in such other Global Note for as long as it remains such an interest. 

        (d)   Any
U.S. Physical Note delivered in exchange for an interest in the U.S. Global Note pursuant to paragraph (b) of this Section shall, unless such change is made
on or after the Resale Restriction Termination Date and except as otherwise provided in Section 307, bear the Private Placement Legend. 

        (e)   The
registered holder of a Global Note 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 Notes. 

        SECTION
307. Transfer Provisions. 

        Unless
and until (i) an Initial Note is sold pursuant to an effective Registration Statement, or (ii) an Initial Note is exchanged for an Exchange Note in the Exchange
Offer pursuant to an effective Registration Statement, in each case, pursuant to the Registration Rights Agreement, the following provisions shall apply: 

        (a)   General.
The provisions of this Section 307 shall apply to all transfers involving any Physical Note and any beneficial interest in
any Global Note. 

        (b)   Certain
Definitions. As used in this Section 307 only, "delivery" of a certificate by a transferee or transferor means the delivery
to the Note Registrar by such transferee or transferor of the applicable certificate duly completed; "holding" includes both possession of a Physical Note and ownership of a beneficial interest in a
Global Note, as the context requires; "transferring" a Global Note means transferring that portion of the principal amount of the transferor's beneficial interest therein that the transferor has
notified the Note Registrar that it has agreed to transfer; and "transferring" a Physical Note means transferring that portion of the principal amount thereof that the transferor has notified the Note
Registrar that it has agreed to transfer. 

        As
used in this Indenture, "Accredited Investor Certificate" means a certificate substantially in the form set forth in Exhibit C; "Regulation S Certificate" means a
certificate substantially in the form set forth in Exhibit D; "Rule 144A Certificate" means a certificate substantially in the form set forth in Exhibit E; and
"Non-Registration Opinion and Supporting Evidence" means a written opinion of counsel reasonably acceptable to the Issuer to the effect that, and such other certification or information as
the Issuer may reasonably require to confirm that, the proposed transfer is being made 

27

 

pursuant
to an exemption from, or in a transaction not subject to, the registration requirements of the Securities Act. 

        (c)   [Intentionally
Omitted] 

        (d)   Deemed
Delivery of a Rule 144A Certificate in Certain Circumstances. A Rule 144A Certificate, if not actually delivered, will
be deemed delivered if (A) (i) the transferor advises the Issuer and the Trustee in writing that the relevant offer and sale were made in accordance with the provisions of Rule 144A (or,
in the case of a transfer of a Physical Note, the transferor checks the box provided on the Physical Note to that effect) and (ii) the transferee advises the Issuer and the Trustee in writing
that (x) it and, if applicable, each account for which it is acting in connection with the relevant transfer, is a qualified institutional buyer within the meaning of Rule 144A,
(y) it is aware that the transfer of Notes to it is being made in reliance on the exemption from the provisions of Section 5 of the Securities Act provided by Rule 144A, and
(z) if at any time the Issuer is not subject to Section 13 or 15(d) of the Exchange Act, prior to the proposed date of transfer the transferee has been given the opportunity to obtain
from the Issuer the information referred to in Rule 144A(d)(4), and has either declined such opportunity or has received such information (or, in the case of a transfer of a Physical Note, the
transferee signs the certification provided on the Physical Note to that effect); or (B) the transferor holds the U.S. Global Note and is transferring to a transferee that will take delivery in
the form of the U.S. Global Note. 

        (e)   Procedures
and Requirements. 

        (1)   if
the proposed transfer occurs prior to the Offshore Notes Exchange Date, and the proposed transferor holds: 

        (A)
a U.S. Physical Note which is surrendered to the Note Registrar, and the proposed transferee or transferor, as applicable: 

        (i)
delivers an Accredited Investor Certificate and, if required by the Issuer, a Non-Registration Opinion and Supporting Evidence, or delivers (or is deemed to have
delivered pursuant to clause (d) above) a Rule 144A Certificate and the proposed transferee requests delivery in the form of a U.S. Physical Note, then the Note Registrar shall
(x) register such transfer in the name of such transferee and record the date thereof in its books and records, (y) cancel such surrendered U.S. Physical Note and (z) deliver a
new U.S. Physical Note to such transferee duly registered in the name of such transferee in principal amount equal to the principal amount being transferred of such surrendered U.S. Physical Note; 

        (ii)
delivers (or is deemed to have delivered pursuant to clause (d) above) a Rule 144A Certificate and the proposed transferee is or is acting through an Agent Member and
requests that the proposed transferee receive a beneficial interest in the U.S. Global Note, then the Note Registrar shall (x) cancel such surrendered U.S. Physical Note, (y) record an
increase in the principal amount of the U.S. Global Note equal to the principal amount being transferred of such surrendered U.S. Physical Note and (z) notify the Depositary in accordance with
the procedures of the Depositary that it approves of such transfer; or 

        (iii)
delivers a Regulation S Certificate and the proposed transferee is or is acting through an Agent Member and requests that the proposed transferee receive a beneficial
interest in the Offshore Global Note, then the Note Registrar shall (x) cancel such surrendered U.S. Physical Note, (y) record an increase in the principal amount of the Offshore Global
Note equal to the principal amount being transferred of such surrendered U.S. Physical Note and (z) notify the Depositary in accordance with the procedures of the Depositary that it approves of
such transfer. 

28

 

        In
any of the cases described in this Section 307(e)(1)(A), the Note Registrar shall deliver to the transferor a new U.S. Physical Note in principal amount equal to the principal
amount not being transferred of such surrendered U.S. Physical Note, as applicable. 

        (B)
an interest in the U.S. Global Note, and the proposed transferee or transferor, as applicable: 

        (i)
delivers an Accredited Investor Certificate and, if required by the Issuer, a Non-Registration Opinion and Supporting Evidence, or delivers (or is deemed to have
delivered pursuant to clause (d) above) a Rule 144A Certificate and the proposed transferee requests delivery in the form of a U.S. Physical Note, then the Note Registrar shall
(w) register such transfer in the name of such transferee and record the date thereof in its books and records, (x) record a decrease in the principal amount of the U.S. Global Note in
an amount equal to the beneficial interest therein being transferred, (y) deliver a new U.S. Physical Note to such transferee duly registered in the name of such transferee in principal amount
equal to the amount of such decrease and (z) notify the Depositary in accordance with the procedures of the Depositary that it approves of such transfer; 

        (ii)
delivers (or is deemed to have delivered pursuant to clause (d) above) a Rule 144A Certificate and the proposed transferee is or is acting through an Agent Member and
requests that the proposed transferee receive a beneficial interest in the U.S. Global Note, then the transfer shall be effected in accordance with the procedures of the Depositary therefor; or 

        (iii)
delivers a Regulation S Certificate and the proposed transferee is or is acting through an Agent Member and requests that the proposed transferee receive a beneficial
interest in the Offshore Global Note, then the Note Registrar shall (w) register such transfer in the name of such transferee and record the date thereof in its books and records,
(x) record a decrease in the principal amount of the U.S. Global Note in an amount equal to the beneficial interest therein being transferred, (y) record an increase in the principal
amount of the Offshore Global Note equal to the amount of such decrease and (z) notify the Depositary in accordance with the procedures of the Depositary that it approves of such transfer. 

        (C)
an interest in the Offshore Global Note, and the proposed transferee or transferor, as applicable: 

        (i)
delivers an Accredited Investor Certificate and, if required by the Trust, a Non-Registration Opinion and Supporting Evidence delivers (or is deemed to have delivered
pursuant to clause (d) above) a Rule 144A Certificate and the proposed transferee requests delivery in the form of a U.S. Physical Note, then the Note Registrar shall (w) register
such transfer in the name of such transferee and record the date thereof in its books and records, (x) record a decrease in the principal amount of the Offshore Global Note in an amount equal
to the beneficial interest therein being transferred, (y) deliver a new U.S. Physical Note to such transferee duly registered in the name of such transferee in principal amount equal to the
amount of such decrease and (z) notify the Depositary in accordance with the procedures of the Depositary that it approves of such transfer; 

        (ii)
delivers (or is deemed to have delivered pursuant to clause (d) above) a Rule 144A Certificate and the proposed transferee is or is acting through an Agent Member and
requests that the proposed transferee receive a beneficial interest in the U.S. Global Note, then the Note Registrar shall (x) record a decrease in the principal amount of the Offshore Global
Note in an amount equal to the beneficial interest therein 

29

 

being
transferred, (y) record an increase in the principal amount of the U.S. Global Note equal to the amount of such decrease and (z) notify the Depositary in accordance with the
procedures of the Depositary that it approves of such transfer; or 

        (iii)
delivers a Regulation S Certificate and the proposed transferee is or is acting through an Agent Member and requests that the proposed transferee receive a beneficial
interest in the Offshore Global Note, then the transfer shall be effected in accordance with the procedures of the Depositary therefor. 

        (2)
If the proposed transfer occurs on or after the Offshore Note Exchange Date and the proposed transferor holds: 

        (A)
U.S. Physical Note which is surrendered to the Note Registrar, and the proposed transferee or transferor, as applicable: 

        (i)
delivers an Accredited Investor Certificate and, if required by the Issuer, a Non-Registration Opinion and Supporting Evidence, or delivers (or is deemed to have
delivered pursuant to clause (d) above) a Rule 144A Certificate and the proposed transferee requests delivery in the form of a U.S. Physical Note, then the procedures set forth in
Section 307(e)(1)(A)(i) shall apply; 

        (ii)
delivers (or is deemed to have delivered pursuant to clause (d) above) a Rule 144A Certificate and the proposed transferee is or is acting through an Agent Member and
requests that the proposed transferee receive a beneficial interest in the Offshore Global Note, then the procedures set forth in Section 307(e)(1)(A)(ii) shall apply; or 

        (iii)
delivers a Regulation S Certificate, then the Note Registrar shall cancel such surrendered U.S. Physical Note and at the direction of the transferee, either: 

        (x)
register such transfer in the name of such transferee, record the date thereof in its books and records and deliver a new Offshore Physical Note to such transferee in principal
amount equal to the principal amount being transferred of such surrendered U.S. Physical Note, or 

        (y)
if the proposed transferee is or is acting through an Agent Member, record an increase in the principal amount of the Offshore Global Note equal to the principal amount being
transferred of such surrendered U.S. Physical Note and notify the Depositary in accordance with the procedures of the Depositary that it approves of such transfer. 

        In
any of the cases described in this Section 307(e)(2)(A)(i), (ii) or (iii)(x), the Note Registrar shall deliver to the transferor a new U.S. Physical Note in principal
amount equal to the principal amount not being transferred of such surrendered U.S. Physical Note, as applicable. 

        (B)
an interest in the U.S. Global Note, and the proposed transferee or transferor, as applicable: 

        (i)
delivers an Accredited Investor Certificate and, if required by the Issuer, a Non-Registration Opinion and Supporting Evidence, or delivers (or is deemed to have
delivered pursuant to clause (d) above) a Rule 144A Certificate and the proposed transferee requests delivery in the form of a U.S. Physical Note, then the procedures set forth in
Section 307(e)(1)(B)(i) shall apply; or 

        (ii)
delivers (or is deemed to have delivered pursuant to clause (d) above) a Rule 144A Certificate and the proposed transferee is or is acting through an Agent 

30

 

Member
and requests that the proposed transferee receive a beneficial interest in the U.S. Global Note, then the procedures set forth in Section 307(e)(1)(B)(ii) shall apply; or 

        (iii)
delivers a Regulation S Certificate, then the Note Registrar shall (x) record a decrease in the principal amount of the U.S. Global Note in an amount equal to the
beneficial interest therein being transferred, (y) notify the Depositary in accordance with the procedures of the Depositary that it approves of such transfer and (z) at the direction of
the transferee, either: 

        (x)
register such transfer in the name of such transferee, record the date thereof in its books and records and deliver a new Offshore Physical Note to such transferee in principal
amount equal to the amount of such decrease, or 

        (y)
if the proposed transferee is or is acting through an Agent Member, record an increase in the principal amount of the Offshore Global Note equal to the amount of such decrease. 

        (C)
an Offshore Physical Note which is surrendered to the Note Registrar, and the proposed transferee or transferor or, as applicable: 

        (i)
delivers (or is deemed to have delivered pursuant to clause (d) above) a Rule 144A Certificate and the proposed transferee is or is acting through an Agent Member and
requests delivery in the form of the U.S. Global Note, then the Note Registrar shall (x) cancel such surrendered Offshore Physical Note, (y) record an increase in the principal amount of
the U.S. Global Note equal to the principal amount being transferred of such surrendered Offshore Physical Note and (z) notify the Depositary in accordance with the procedures of the Depositary
that it approves of such transfer; 

        (ii)
where the proposed transferee is or is acting through an Agent Member, requests that the proposed transferee receive a beneficial interest in the Offshore Global Note, then the Note
Registrar shall (x) cancel such surrendered Offshore Physical Note, (y) record an increase in the principal amount of the Offshore Global Note equal to the principal amount being
transferred of such surrendered Offshore Physical Note and (z) notify the Depositary in accordance with the procedures of the Depositary that it approves of such transfer; or 

        (iii)
does not make a request covered by Section 307(e)(2)(C)(i) or Section 307(e)(2)(C)(ii), then the Note Registrar shall (x) register such transfer in the
name of such transferee and record the date thereof in its books and records, (y) cancel such surrendered Offshore Physical Note and (z) deliver a new Offshore Physical Note to such
transferee duly registered in the name of such transferee in principal amount equal to the principal amount being transferred of such surrendered Offshore Physical Note. 

        In
any of the cases described in this Section 307(e)(2)(C), the Note Registrar shall deliver to the transferor a new U.S. Physical Note in principal amount equal to the principal
amount not being transferred of such surrendered U.S. Physical Note, as applicable. 

        (D)
an interest in the Offshore Global Note, and the proposed transferee or transferor, as applicable: 

        (i)
delivers (or is deemed to have delivered pursuant to clause (d) above) a Rule 144A Certificate and the proposed transferee is or is acting through an Agent Member and
requests delivery in the form of the U.S. Global Note, then the Note Registrar shall (x) record a decrease in the principal amount of the Offshore Global Note in an amount equal to the
beneficial interest therein being transferred, (y) record an 

31

 

increase
in the principal amount of the U.S. Global Note equal to the amount of such decrease and (z) notify the Depositary in accordance with the procedures of the Depositary that it approves
of such transfer; 

        (ii)
where the proposed transferee is or is acting through an Agent Member, requests that the proposed transferee receive a beneficial interest in the Offshore Global Note, then the
transfer shall be effected in accordance with the procedures of the Depositary therefor, or 

        (iii)
does not make a request covered by Section 307(e)(2)(D)(i) or Section 307(e)(2)(D)(ii), then the Note Registrar shall (w) register such transfer in the
name of such transferee and record the date
thereof in its books and records, (x) record a decrease in the principal amount of the Offshore Global Note in an amount equal to the beneficial interest therein being transferred,
(y) deliver a new Offshore Physical Note to such transferee duly registered in the name of such transferee in principal amount equal to the amount of such decrease and (z) notify the
Depositary in accordance with the procedures of the Depositary that it approves of such transfer. 

        (f)    Execution,
Authentication and Delivery of Physical Notes. In any case in which the Note Registrar is required to deliver a Physical Note to
a transferee or transferor, the Issuer shall execute, and the Trustee shall authenticate and make available for delivery, such Physical Note. 

        (g)   Certain
Additional Terms Applicable to Physical Notes. Any transferee entitled to receive a Physical Note may request that the principal
amount thereof be evidenced by one or more Physical Notes in any authorized denomination or denominations the Note Registrar shall comply with such request if all other transfer restrictions are
satisfied. 

        (h)   Transfers
Not Covered by Section 307(e). The Note Registrar shall effect and record, upon receipt of a written request from the
Issuer so to do, a transfer not otherwise permitted by Section 307(e), such recording to be done in accordance with the otherwise applicable provisions of Section 307(e), upon the
furnishing by the proposed transferor or transferee of a Non-Registration Opinion and Supporting Evidence. 

        (i)    General.
By its acceptance of any Note bearing the Private Placement Legend, each Holder of such Note acknowledges the restrictions on
transfer of such Note set forth in this Indenture and in the Private Placement Legend and agrees that it will transfer such Note only as provided in the Indenture. The Note Registrar shall not
register a transfer of any Note unless such transfer complies with the restrictions with respect thereto set forth in this Indenture. The Note Registrar shall not be required to determine (but may
rely upon a determination made by the Issuer) the sufficiency or accuracy of any such certifications, legal opinions, other information or document. 

        (j)    Private
Placement Legend. Upon the transfer, exchange or replacement of Notes not bearing the Private Placement Legend, the Note Registrar
shall deliver Notes that do not bear the Private Placement Legend. Upon the transfer, exchange or replacement of Notes bearing the Private Placement Legend, the Note Registrar shall deliver only Notes
that bear the Private Placement Legend unless (i) the circumstances exist contemplated by the fourth paragraph of Section 201 (with respect to an Offshore Physical Note) or the requested
transfer is at least two years after the original issue date of the Initial Note (with respect to any Physical Note), (ii) there is delivered to the Note Registrar an Opinion of Counsel
reasonably satisfactory to the Issuer and the Trustee to the effect that neither such legend nor the related restrictions on transfer are required in order to maintain compliance with the provisions
of the Securities Act or (iii) such Notes are exchanged for Exchange Notes pursuant to an Exchange Offer. 

32

 

        SECTION
308. Mutilated, Destroyed, Lost and Stolen Notes. 

        If
(i) any mutilated Note is surrendered to the Trustee, or (ii) the Issuer and the Trustee receive evidence to their satisfaction of the destruction, loss or theft of any
Note, and there is delivered to the Issuer and the Trustee such security or indemnity as may be required by them to save each of them harmless, then, in the absence of written notice to the Issuer or
the Trustee that such Note has been acquired by a bona fide purchaser, the Issuer shall execute and upon Issuer Order the Trustee shall authenticate and deliver, in exchange for any such mutilated
Note or in lieu of any such destroyed, lost or stolen Note, a new Note of like tenor and principal amount, bearing a number not contemporaneously outstanding. 

        In
case any such mutilated, destroyed, lost or stolen Note has become or is about to become due and payable, the Issuer in its discretion may, instead of issuing a new Note, pay such
Note. 

        Upon
the issuance of any new Note under this Section 308, the Issuer may require the payment of a sum sufficient to cover any tax or other governmental charge that may be imposed
in relation thereto and shall require the payment of a sum sufficient to pay any other expenses (including the fees and expenses of the Trustee) connected therewith. 

        Every
new Note issued pursuant to this Section 308 in lieu of any mutilated, destroyed, lost or stolen Note shall constitute an original additional contractual obligation of the
Issuer, whether or not the mutilated, destroyed, lost or stolen Note shall be at any time enforceable by anyone, and shall be entitled to all benefits of this Indenture equally and proportionately
with any and all other Notes duly issued hereunder. 

        The
provisions of this Section 308 are exclusive and shall preclude (to the extent lawful) all other rights and remedies with respect to the replacement or payment of mutilated,
destroyed, lost or stolen Notes. 

        SECTION
309. Payment of Interest; Interest Rights Preserved. 

        Interest
on any Note which is payable, and is punctually paid or duly provided for, on any Interest Payment Date shall be paid to the Person in whose name such Note (or one or more
Predecessor Notes) is registered at the close of business on the Regular Record Date for such interest, with respect to Global Notes only, by wire transfer of immediately available funds to the
account specified by such Persons or, if no such account is specified, or with respect to all Notes other than Global Notes, at the office or agency of the Issuer maintained for such purpose pursuant
to Section 1002; provided, however, that each installment of interest may at the Issuer's option be paid by (i) mailing a check
for such interest, payable to or upon the written order of the Person entitled thereto pursuant to Section 310, to the address of such Person as it appears in the Note Register or
(ii) transferring the interest payment to an account located in the United States maintained by the payee. 

        Any
interest on any Note which is payable, but is not punctually paid or duly provided for, on any Interest Payment Date shall forthwith cease to be payable to the Holder on the Regular
Record Date by virtue of having been such Holder, and such defaulted interest and (to the extent lawful) interest on such defaulted interest at the rate borne by the Notes (such defaulted interest and
interest thereon herein collectively called "Defaulted Interest") may be paid by the Issuer, at its election in each case, as provided in clause (1) or (2) below: 

        (1)   The
Issuer may elect to make payment of any Defaulted Interest to the Persons in whose names the Notes (or their respective Predecessor Notes) are registered at the
close of business on a Special Record Date for the payment of such Defaulted Interest, which shall be fixed in the following manner. The Issuer shall notify the Trustee in writing of the amount of
Defaulted Interest proposed to be paid on each Note and the date of the proposed payment, and at the same time the Issuer shall deposit with the Trustee an amount of money equal to the aggregate
amount 

33

 

proposed
to be paid in respect of such Defaulted Interest or shall make arrangements satisfactory to the Trustee for such deposit prior to the date of the proposed payment, such money when deposited
to be held in trust for the benefit of the Persons entitled to such Defaulted Interest as in this clause provided. Thereupon the Issuer, with the written consent of the Trustee, shall fix a Special
Record Date for the payment of such Defaulted Interest which shall be not more than 15 days and not less than 10 days prior to the date of the proposed payment and not less than
10 days after the receipt by the Trustee of the notice of the proposed payment. The Trustee, in the name and at the expense of the Issuer, shall cause notice of the proposed payment of such
Defaulted Interest and the Special Record Date therefor to be given in the manner provided for in Section 106, not less than 10 days prior to such Special Record Date. Notice of the
proposed payment of such Defaulted Interest and the Special Record Date therefor having been so given, such Defaulted Interest shall be paid to the Persons in whose names the Notes (or their
respective Predecessor Notes) are registered at the close of business on such Special Record Date and shall no longer be payable pursuant to the following clause (2). 

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

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

        SECTION
310. Persons Deemed Owners. 

        Prior
to the due presentment of a Note for registration of transfer, the Issuer, the Trustee and any agent of the Issuer or the Trustee may treat the Person in whose name such Note is
registered as the owner of such Note for the purpose of receiving payment of principal of (and premium, if any) and (subject to Sections 305 and 309) interest on such Note and for all other purposes
whatsoever, whether or not such Note be overdue, and none of the Issuer, the Trustee or any agent of the Issuer or the Trustee shall be affected by notice to the contrary. 

        SECTION
311. Cancellation. 

        All
Notes surrendered for payment, redemption, registration of transfer or exchange shall, if surrendered to any Person other than the Trustee, be delivered to, and promptly cancelled
by, the Trustee. The Issuer may at any time deliver to the Trustee for cancellation any Notes previously authenticated and delivered hereunder which the Issuer may have acquired in any manner
whatsoever, and may deliver to the Trustee (or to any other Person for delivery to the Trustee) for cancellation any Notes previously authenticated hereunder which the Issuer has not issued and sold,
and all Notes so delivered shall be promptly cancelled by the Trustee. If the Issuer shall so acquire any of the Notes, however, such acquisition shall not operate as a redemption or satisfaction of
the indebtedness represented by such Notes unless and until the same are surrendered to the Trustee for cancellation. No Notes shall be authenticated in lieu of or in exchange for any Notes cancelled
as provided in this Section, except as expressly permitted by this Indenture. All cancelled Notes held by the Trustee shall be disposed of by the Trustee in accordance with its customary procedures
and certification of their disposal delivered to the Issuer unless by Issuer Order the Issuer shall direct that cancelled Notes be returned to it after being appropriately designated as cancelled. 

        SECTION
312. Computation of Interest. 

        Interest
on the Notes shall be computed on the basis of a 360-day year of twelve 30-day months. 

34

   
        SECTION 313. CUSIP Numbers. 

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

        In
the event that the Issuer shall issue and the Trustee shall authenticate any Additional Notes pursuant to this Indenture, the Issuer shall use its best efforts to obtain the same
CUSIP number for such Additional Notes as is printed on the Notes outstanding at such time; provided, however, that if any series of Additional Notes is determined, pursuant to an Opinion of Counsel,
to be a different class of security than the Notes outstanding at such time for federal income tax purposes, the Issuer may obtain a CUSIP number for such series of Additional Notes that is different
from the CUSIP number printed on the Notes then outstanding, in which event such Additional Notes shall be deemed to be a different series from the Notes issued on the date hereof. 

ARTICLE FOUR  

 SATISFACTION AND DISCHARGE  

        SECTION 401. Satisfaction and Discharge of Indenture. 

        This
Indenture shall upon Issuer Request cease to be of further effect (except as to surviving rights of registration of transfer or exchange of Notes expressly provided for herein or
pursuant hereto) and the Trustee, at the expense of the Issuer, shall execute proper instruments acknowledging satisfaction and discharge of this Indenture when 

        (1)   either 

        (a)   all
Notes theretofore authenticated and delivered (other than (i) Notes which have been destroyed, lost or stolen and which have been replaced or paid as provided
in Section 308 and (ii) Notes for whose payment money has theretofore been deposited in trust with the Trustee or any Paying Agent or segregated and held in trust by the Issuer and
thereafter repaid to the Issuer or discharged from such trust, as provided in Section 1003) have been delivered to the Trustee for cancellation; or 

        (b)   all
such Notes not theretofore delivered to the Trustee for cancellation 

        (i)    have
become due and payable, or 

        (ii)   will
become due and payable at their Stated Maturity within one year, or 

        (iii)  are
to be called for redemption within one year under arrangements satisfactory to the Trustee for the giving of notice of redemption by the Trustee in the name, and
at the expense, of the Issuer, 

and
the Issuer, in the case of (i), (ii) or (iii) above, has irrevocably deposited or caused to be deposited with the Trustee as trust funds in trust for such purpose an amount
sufficient to pay and discharge the entire indebtedness on such Notes not theretofore delivered to the Trustee for cancellation, for principal (and premium, if any) and interest and Additional
Interest, if any, to the date of such deposit (in the case of Notes which have become due and payable) or to the Stated Maturity or Redemption Date, as the case may be, together with irrevocable
instructions from the 

35

 

Issuer
directing the Trustee to apply such funds to the payment thereof at Stated Maturity or redemption, as the case may be; 

        (2)   the
Issuer has paid or caused to be paid all other sums payable hereunder by the Issuer; and 

        (3)   the
Issuer has delivered to the Trustee an Officer's Certificate and an Opinion of Counsel, each stating that all conditions precedent herein provided for relating to
the satisfaction and discharge of this Indenture have been complied with. 

        Notwithstanding
the satisfaction and discharge of this Indenture, the obligations of the Issuer to the Trustee under Section 606 and, if money shall have been deposited with the
Trustee pursuant to
subclause (b) of clause (1) of this Section, the obligations of the Trustee under Section 402 and the last paragraph of Section 1003 shall survive. 

        SECTION
402. Application of Trust Money. 

        On
or prior to the effective date of this Indenture, the Trustee shall establish a segregated, non-interest bearing corporate trust account (the "Payment Account") maintained
by the Trustee for the benefit of the Holders in which all amounts paid to the Trustee for the benefit of the Holders in respect of the Notes will be held and from which the Trustee (if the Trustee is
the Paying Agent) shall make payments to the Holders in accordance with this Indenture and the Notes. Subject to the provisions of the last paragraph of Section 1003, all money deposited with
the Trustee pursuant to Section 401 and otherwise pursuant to this Indenture shall be held in trust and applied by it, in accordance with the provisions of the Notes and this Indenture, to the
payment, either directly or through any Paying Agent (including the Issuer acting as its own Paying Agent) as the Trustee may determine, to the Persons entitled thereto, of the principal (and premium,
if any) and interest (and Additional Interest, if any) for whose payment such money has been deposited with the Trustee. 

ARTICLE FIVE  

 REMEDIES  

        SECTION 501. Events of Default. 

        "Event
of Default", wherever used herein, means any one of the following events (whatever the reason for such Event of Default and whether it shall be voluntary or involuntary or be
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): 

        (1)   default
in the payment of interest or Additional Interest, if any, on any Note when due and payable and continuance of such default for a period of 30 days; or 

        (2)   default
in the payment of principal of (or premium, if any, on) any Note at its Stated Maturity, upon acceleration, redemption or otherwise; or 

        (3)   default
in the payment of principal or interest or Additional Interest, if any, on any Note required to be purchased pursuant to an Excess Proceeds Offer as set forth in
Section 1017 or pursuant to a Change of Control Offer as set forth in Section 1010; or 

        (4)   failure
to perform or comply with the provisions in Section 801; or 

        (5)   default
in the performance or breach of any covenant or agreement of the Issuer or Parent in this Indenture, under the Notes or in the Collateral Documents (other than a
default in the performance, or breach, of a covenant or agreement which is specifically dealt with elsewhere in this Section), and continuance of such default or breach for a period of 30 consecutive
days after there has been given, by registered or certified mail, to the Issuer by the Trustee or to the Issuer and the Trustee by the Holders of at least 25% in principal amount of the Outstanding 

36

 

Notes
a written notice specifying such default or breach and requiring it to be remedied and stating that such notice is a "Notice of Default" hereunder; or 

        (6)   there
occurs with respect to any issue or issues of Indebtedness of Parent or any of its Restricted Subsidiaries having an outstanding principal amount of
$25.0 million or more in the aggregate for all such issues of all such Persons, whether such Indebtedness now exists or shall hereafter be created, (I) an event of default that has
caused the holder thereof to declare such Indebtedness to be due and payable prior to its Stated Maturity and such Indebtedness has not been discharged in full or such acceleration has not been
rescinded or annulled by the earlier of (x) the expiration of any applicable grace period or (y) the thirtieth day after such acceleration and/or (II) the failure to make a
principal payment at the final (but not any interim) fixed maturity and such defaulted payment shall not have been made, waived or extended by the earlier of (x) the expiration of any
applicable grace period or (y) the thirtieth day after such default; or 

        (7)   any
final judgment or order (not covered by insurance) for the payment of money in excess of $25.0 million in the aggregate for all such final judgments or orders
(treating any deductibles, self-insurance or retention as not so covered) shall be rendered against Parent or any of its Restricted Subsidiaries and shall not be paid or discharged, and
there shall be any period of 30 consecutive days following entry of the final judgment or order that causes the aggregate amount for all such final judgments or orders outstanding and not paid or
discharged against all such Persons to exceed $25.0 million during which a stay of enforcement of such final judgment or order, by reason of a pending appeal or otherwise, shall not be in
effect; or 

        (8)   a
court having jurisdiction in the premises enters a decree or order for (A) relief in respect of Parent, the Issuer or any Significant Subsidiary in an
involuntary case under any applicable bankruptcy, insolvency or other similar law now or hereafter in effect, (B) appointment of a receiver, liquidator, assignee, custodian, trustee,
sequestrator or similar official of Parent, the Issuer or any Significant Subsidiary or for all or substantially all of the property and assets of any of Parent, the Issuer or any Significant
Subsidiary or (C) the winding up or liquidation of the affairs of Parent, the Issuer or any Significant Subsidiary and, in each case, such decree or order shall remain unstayed and in effect
for a period of 30 consecutive days; or 

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

        (10) (A)
except as permitted by the Collateral Documents, any amendments thereto and the provisions of this Indenture, any of the Collateral Documents ceases to be in full
force and effect or ceases to be effective, in all material respects, to create the Lien purported to be created in the Collateral in favor of the holders for 30 days after notice to Parent or
the Issuer, (B) Parent or the Issuer challenges in writing the Lien on the Collateral under the Collateral Documents prior to the time that the Liens on the Collateral are to be released or
(C) Parent or the Issuer asserts in writing that any of the Collateral Documents is invalid or unenforceable, other than in accordance with its terms; or 

        (11) the
Parent Guarantee or any Guarantee of a Restricted Subsidiary of Parent that is a Significant Subsidiary, if any, ceases to be in full force and effect (except as
contemplated by the terms thereof) or any Guarantor denies or disaffirms its obligations under this Indenture. 

37

 

        SECTION
502. Acceleration of Maturity; Rescission and Annulment. 

        If
an Event of Default (other than an Event of Default specified in Section 501(8) or 501(9)) occurs and is continuing, then and in every such case the Trustee or the Holders of
not less than 25% in principal amount of the Notes Outstanding may, and the Trustee at the request of such Holders shall, declare the principal of, premium, if any, and accrued but unpaid interest and
Additional Interest, if any, on all the Notes to be due and payable immediately, by a notice in writing to the Issuer (and to the Trustee if given by Holders), and upon any such declaration of
acceleration, such principal of, premium, if any, and accrued interest and Additional Interest, if any, shall become immediately due and payable. If an Event of Default specified in
Section 501(8) or 501(9) occurs, then the principal amount of, premium, if any, and accrued interest and Additional Interest, if any, on the Notes then Outstanding shall ipso
facto become and be immediately due and payable without any declaration or other act on the part of the Trustee or any Holder. 

        At
any time after a declaration of acceleration has been made, the Holders of a majority in principal amount of the Notes Outstanding, by written notice to the Issuer and the Trustee,
may waive all past defaults and rescind and annul such declaration and its consequences if 

        (1)   the
Issuer has paid or deposited with the Trustee a sum sufficient to pay, 

        (A)
all overdue interest and Additional Interest on all Outstanding Notes, 

        (B)
all unpaid principal of (and premium, if any, on) any Outstanding Notes which has become due otherwise than by such declaration of acceleration, and interest on such unpaid principal
at the rate borne by the Notes, 

        (C)
to the extent that payment of such interest is lawful, interest on overdue interest at the rate borne by the Notes, and 

        (D)
all sums paid or advanced by the Trustee hereunder and the reasonable compensation, fees, expenses, disbursements and advances of the Trustee, its agents and counsel and any amounts
due the Trustee under Section 606; 

        (2)   all
Events of Default, other than the non-payment of amounts of principal of (or premium, if any, on) and accrued and unpaid interest and Additional
Interest, if any, on the Notes which have become due solely by such declaration of acceleration, have been cured or waived as provided in Section 513; and 

        (3)   the
rescission, in the Opinion of Counsel, would not conflict with any judgment or decree of a court of competent jurisdiction. 

No
such rescission shall affect any subsequent default or impair any right consequent thereon. 

        Notwithstanding
the preceding paragraph, in the event of a declaration of acceleration in respect of the Notes because of an Event of Default specified in Section 501(6) shall
have occurred and be continuing, such declaration of acceleration shall be automatically rescinded and annulled if the Indebtedness that is the subject of such Event of Default has been discharged or
the holders thereof have rescinded their declaration of acceleration in respect of such Indebtedness, and written notice of such discharge or rescission, as the case may be, shall have been given to
the Trustee by Parent or the Issuer and countersigned by the holders of such Indebtedness or a trustee, fiduciary or agent for such holders, within 60 days after such declaration of
acceleration in respect of the Notes, and no other Event of Default has occurred during such 60-day period which has not been cured or waived during such period. 

38

 

        SECTION
503. Collection of Indebtedness and Suits for Enforcement by Trustee. 

        The
Issuer covenants that if: 

        (a)   default
is made in the payment of any installment of interest and Additional Interest, if any, on any Note when such interest becomes due and payable and such default
continues for a period of 30 days, or 

        (b)   default
is made in the payment of the principal of (or premium, if any, on) any Note at the Maturity thereof, 

the
Issuer will pay to the Trustee for the benefit of the Holders of such Notes, the whole amount then due and payable on such Notes for principal (and premium and Additional Interest, if any) and
interest, and interest on any overdue principal (and premium, if any) and, to the extent that payment of such interest shall be legally enforceable, upon any overdue installment of interest and
Additional Interest, if any, at the rate borne by the Notes, and, in addition thereto, such further amount as shall be sufficient to cover the costs and expenses of collection, including the
reasonable compensation, fees expenses, disbursements and advances of the Trustee, its agents and counsel and any amounts due the Trustee under Section 606. 

        If
the Issuer fails to pay such amounts forthwith upon such demand, the Trustee, in its own name as trustee of an express trust, may institute a judicial proceeding for the collection of
the sums so due and unpaid, may prosecute such proceeding to judgment or final decree and may enforce the same against the Issuer or any other obligor upon the Notes and collect the moneys adjudged or
decreed to be payable in the manner provided by law out of the property of the Issuer or any other obligor upon the Notes, wherever situated. 

        If
an Event of Default occurs and is continuing, the Trustee may in its discretion proceed to protect and enforce its rights and the rights of the Holders by such appropriate judicial
proceedings as the Trustee shall deem most effectual to protect and enforce any such rights, whether for the specific enforcement of any covenant or agreement in this Indenture or in aid of the
exercise of any power granted herein, or to enforce any other proper remedy. 

        SECTION
504. Trustee May File Proofs of Claim. 

        In
case of the pendency of any receivership, insolvency, liquidation, bankruptcy, reorganization, arrangement, adjustment, composition or other judicial proceeding relative to the Issuer
or any other obligor upon the Notes or the property of the Issuer or of such other obligor or their creditors, the Trustee (irrespective of whether the principal of the Notes shall then be due and
payable as therein expressed or by declaration or otherwise and irrespective of whether the Trustee shall have made any demand on the Issuer for the payment of overdue principal, premium, if any,
interest or Additional Interest, if any) shall be entitled and empowered, by intervention in such proceeding or otherwise, 

        (i)
to file and prove a claim for the whole amount of principal (and premium and Additional Interest, if any) and interest owing and unpaid in respect of the Notes and to file such other
papers or documents as may be necessary or advisable in order to have the claims of the Trustee (including any claim for the reasonable compensation, fees, expenses, disbursements and advances of the
Trustee, its agents and counsel and any amounts due the Trustee under Section 606) and of the Holders allowed in such judicial proceeding, and 

        (ii)
to collect and receive any moneys or other property payable or deliverable on any such claims and to distribute the same; 

and
any custodian, receiver, assignee, trustee, liquidator, sequestrator or similar official in any such judicial proceeding is hereby authorized by each Holder to make such payments to the Trustee
and, in the event that the Trustee shall consent to the making of such payments directly to the Holders, to pay 

39

 

the
Trustee any amount due it for the reasonable compensation, expenses, disbursements and advances of the Trustee, its agents and counsel, and any other amounts due the Trustee under
Section 606. 

        Nothing
herein contained shall be deemed to authorize the Trustee to authorize or consent to or accept or adopt on behalf of any Holder any plan of reorganization, arrangement,
adjustment or composition
affecting the Notes or the rights of any Holder thereof, or to authorize the Trustee to vote in respect of the claim of any Holder in any such proceeding. 

        SECTION
505. Trustee May Enforce Claims Without Possession of Notes. 

        All
rights of action and claims under this Indenture or the Notes may be prosecuted and enforced by the Trustee without the possession of any of the Notes or the production thereof in
any proceeding relating thereto, and any such proceeding instituted by the Trustee shall be brought in its own name and as trustee of an express trust, and any recovery of judgment shall, after
provision for the payment of the reasonable compensation, fees, expenses, disbursements and advances of the Trustee, its agents and counsel, be for the ratable benefit of the Holders of the Notes in
respect of which such judgment has been recovered. 

        SECTION
506. Application of Money Collected. 

        Any
money collected by the Trustee pursuant to this Article, or any money otherwise distributable in respect of the Issuer's or Parent's obligations under this Indenture, shall be
applied in the following order, at the date or dates fixed by the Trustee and, in case of the distribution of such money on account of principal (or premium, if any, or Additional Interest, if any) or
interest, upon presentation of the Notes and the notation thereon of the payment if only partially paid and upon surrender thereof if fully paid: 

        FIRST:
To the payment of all amounts due the Trustee under Section 606; 

        SECOND:
To the payment of the amounts then due and unpaid for principal of (and premium and Additional Interest, if any) and interest on the Notes in respect of which or for the benefit
of which such money has been collected, ratably, without preference or priority of any kind, according to the amounts due and payable on such Notes for principal (and premium and Additional Interest,
if any) and interest, respectively; and 

        THIRD:
The balance, if any, to the Person or Persons entitled thereto. 

        SECTION
507. Limitation on Suits. 

        Except
to enforce the right to receive payment of principal or, premium, if any, or interest or Additional Interest, if any, when due, no Holder of any Notes shall have any right to
institute any
proceeding, judicial or otherwise, with respect to this Indenture, or for the appointment of a receiver or trustee, or for any other remedy hereunder, unless: 

        (1)   such
Holder has previously given written notice to the Trustee of a continuing Event of Default; 

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

        (3)   such
Holder or Holders offer the Trustee indemnity satisfactory to the Trustee against any costs, liability or expense; 

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

        (5)   during
such 60-day period, the Holders of a majority in aggregate principal amount of the Outstanding Notes do not give the Trustee a direction that is
inconsistent with the request; 

40

 

it
being understood and intended that no one or more Holders shall have any right in any manner whatever by virtue of, or by availing of, any provision of this Indenture to affect, disturb or
prejudice the rights of any other Holders, or to obtain or to seek to obtain priority or preference over any other Holders or to enforce any right under this Indenture, except in the manner herein
provided and for the equal and ratable benefit of all the Holders. 

        SECTION
508. Unconditional Right of Holders to Receive Principal, Premium and Interest. 

        Notwithstanding
any other provision in this Indenture, the Holder of any Note shall have the right, which is absolute and unconditional, to receive payment, as provided herein
(including, if applicable, Article Fourteen) and in such Note of the principal of (and premium and Additional Interest, if any) and (subject to Section 309) interest on such Note on the
respective Stated Maturities expressed in such Note (or, in the case of redemption, on the Redemption Date) and to institute suit for the enforcement of any such payment, and such rights shall not be
impaired without the consent of such Holder. 

        SECTION
509. Restoration of Rights and Remedies. 

        If
the Trustee or any Holder has instituted any proceeding to enforce any right or remedy under this Indenture and such proceeding has been discontinued or abandoned for any reason, or
has been determined adversely to the Trustee or to such Holder, then and in every such case, subject to any determination in such proceeding, the Issuer, the Trustee and the Holders shall be restored
severally and respectively to their former positions hereunder and thereafter all rights and remedies of the Trustee and the Holders shall continue as though no such proceeding had been instituted. 

        SECTION
510. Rights and Remedies Cumulative. 

        Except
as otherwise provided with respect to the replacement or payment of mutilated, destroyed, lost or stolen Notes in the last paragraph of Section 308, no right or remedy
herein conferred upon or reserved to the Trustee or to the Holders is intended to be exclusive of any other right or remedy, and every right and remedy shall, to the extent permitted by law, be
cumulative and in addition to every other right and remedy given hereunder or now or hereafter existing at law or in equity or otherwise. The assertion or employment of any right or remedy hereunder,
or otherwise, shall not prevent the concurrent assertion or employment of any other appropriate right or remedy. 

        SECTION
511. Delay or Omission Not Waiver. 

        No
delay or omission of the Trustee or of any Holder of any Note to exercise any right or remedy accruing upon any Event of Default shall impair any such right or remedy or constitute a
waiver of any such Event of Default or an acquiescence therein. Every right and remedy given by this Article or by law to the Trustee or to the Holders may be exercised from time to time, and as often
as may be deemed expedient, by the Trustee or by the Holders, as the case may be. 

        SECTION
512. Control by Holders. 

        The
Holders of not less than a majority in principal amount of the Outstanding Notes shall have the right to direct the time, method and place of conducting any proceeding for any remedy
available to the Trustee, or exercising any trust or power conferred on the Trustee, provided that 

        (1)   such
direction shall not be in conflict with any rule of law or with this Indenture, 

        (2)   the
Trustee may take any other action deemed proper by the Trustee which is not inconsistent with such direction, and 

        (3)   the
Trustee need not take any action which might involve it in personal liability or which, in the good faith determination of the Trustee, may be unjustly prejudicial
to the Holders not consenting. 

41

 

        SECTION
513. Waiver of Past Defaults. 

        The
Holders of not less than a majority in principal amount of the Outstanding Notes may on behalf of the Holders of all the Notes waive any past default hereunder and its consequences,
except a default 

        (1)   in
respect of the payment of the principal of (or premium or Additional Interest, if any) or interest on any Note, or 

        (2)   in
respect of a covenant or provision hereof which under Article Nine cannot be modified or amended without the consent of the Holder of each Outstanding Note affected. 

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

        SECTION
514. Waiver of Stay or Extension Laws. 

        The
Issuer covenants (to the extent that it may lawfully do so) that it will not 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 Issuer (to the extent that it may
lawfully do so) hereby expressly waives all benefit or advantage of any such law and covenants that it will not hinder, delay or impede the execution of any power herein granted to the Trustee, but
will suffer and permit the execution of every such power as though no such law had been enacted. 

ARTICLE SIX  

 THE TRUSTEE  

        SECTION 601. Notice of Defaults; Certain Duties of Trustee. 

        (a)   Within
90 days after the occurrence of any Default hereunder, the Trustee shall transmit in the manner and to the extent provided in TIA Section 313(c),
notice of such Default hereunder actually known to the corporate trust officer having responsibility for the administration of this Indenture on behalf of the Trustee, unless such Default shall have
been cured or waived; provided, however, that, except in the case of a Default in the payment of the principal of (or premium, if any) or
interest on any Note, the Trustee shall be protected in withholding such notice if and so long as the board of directors, the executive committee or a trust committee of directors and/or Responsible
Officers of the Trustee in good faith determines that the withholding of such notice is in the interest of the Holders; and provided further that in the case of any
Default of the character specified in Section 501(6), no such notice to Holders shall be given until at least 30 days after the corporate trust officer having responsibility for the
administration of this Indenture on behalf of Trustee has actual knowledge of the occurrence thereof. 

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

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

        (1)   the
Trustee need perform only those duties that are specifically set forth in this Indenture and no others, and no implied covenants or obligations shall be read into
this Indenture against the Trustee; and 

42

 

        (2)   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, but in the case of any such certificates or opinions which by any provision hereof are
specifically required to be furnished to the Trustee, 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. This Section 601(b) shall be in lieu of Section 315(a) of the Trust Indenture Act and such Section 315(a) is hereby
expressly excluded from this Indenture, as permitted by the Trust Indenture Act. 

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

        (1)   this
Section (d) does not limit the effect of Section (c) of this Section 601; 

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

        (3)   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 in accordance with the
direction of the Holders of not less than a majority in principal amount of the Notes at the time Outstanding relating to the time, method and place of conducting any proceeding for any remedy
available to the Trustee, or exercising any trust or power conferred upon the Trustee under this Indenture with respect to the Securities of that series. This Section 601(d)(3) shall be in lieu
of Section 316(a)(1)(A) of the Trust Indenture Act and such Section 316(a)(1)(A) is hereby expressly excluded from this Indenture, as permitted by the Trust Indenture Act. 

        (e)   Subparagraphs
(d)(1), (2) and (3) shall be in lieu of Sections 315(d)(1), 315(d)(2) and 315(d)(3) of the Trust Indenture Act and such Sections 315(d)(1),
315(d)(2) and 315(d)(3) are hereby expressly excluded from this Indenture, as permitted by the Trust Indenture Act. 

        (f)    Every
provision of this Indenture that in any way relates to the Trustee is subject to paragraphs (a), (b), (c), (d), (e) and (g) and (h) of this
Section 601. 

        (g)   The
Trustee may refuse to perform any duty or exercise any right or power or extend or risk its own funds or otherwise incur any financial liability unless it receives
indemnity satisfactory to it against any loss, liability or expense. 

        (h)   Money
held by the Trustee in trust hereunder need not be segregated from other funds except to the extent required by law. The Trustee (acting in any capacity hereunder)
shall be under no liability for interest on any money received by it hereunder unless otherwise agreed in writing with the Issuer. 

        SECTION
602. Certain Rights of Trustee. 

        Subject
to its duties and responsibilities under the Trust Indenture Act, 

        (a)   the
Trustee may conclusively rely and shall be protected in acting or refraining from acting upon any resolution, certificate, statement, instrument, opinion, report,
notice, request, direction, consent, order, bond, debenture, note, other evidence of indebtedness or other paper or document believed by it to be genuine and to have been signed or presented by the
proper party or parties; 

        (b)   whenever
in the administration of this Indenture the Trustee shall deem it desirable that a matter be proved or established prior to taking, suffering or omitting any
action hereunder, the Trustee (unless other evidence be herein specifically prescribed) may, in the absence of bad faith on its part, conclusively rely upon an Officer's Certificate; 

43

 

        (c)   the
Trustee may execute any of the trusts or powers hereunder or perform any duties hereunder either directly or by or through agents or attorneys and the Trustee shall
not be responsible for any misconduct or negligence on the part of any agent or attorney appointed with due care by it hereunder; 

        (d)   the
Trustee shall not be liable for any action taken, suffered, or omitted to be taken by it in good faith which it believes to be authorized or within its rights or
powers conferred under this Indenture; 

        (e)   the
Trustee may consult with counsel selected by it and any advice or Opinion of Counsel shall be full and complete authorization and protection in respect of any action
taken or suffered or omitted by it hereunder in good faith and in accordance with such advice or Opinion of Counsel; 

        (f)    the
Trustee shall be under no obligation to exercise any of the rights or powers vested in it by this Indenture at the request, order or direction of any of the Holders,
pursuant to the provisions of this Indenture, unless such Securityholders shall have offered to the Trustee security or indemnity satisfactory to it against the costs, expenses and liabilities which
may be incurred therein or thereby; 

        (g)   any
request or direction of the Issuer or Parent mentioned herein shall be sufficiently evidenced by a written request or order signed in the name of the Issuer or
Parent, as applicable, by the chairman of the board, the vice chairman, the chief executive officer, the president, any executive vice president, any senior vice president, the treasurer, the
controller, or the secretary or assistant treasurer or assistant secretary of the Issuer or Parent, as applicable, and any resolution of the Board of Directors may be sufficiently evidenced by a Board
Resolution; 

        (h)   the
Trustee shall not be bound to make any investigation into the facts or matters stated in any resolution, certificate, statement, instrument, opinion, report, notice,
request, direction, consent, order, bond, debenture, note, other evidence of indebtedness or other paper or document, but the Trustee, 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
Issuer and Parent, personally or by agent or attorney at the sole cost of the Issuer and Parent and shall incur no liability or additional liability of any kind by reason of such inquiry or
investigation; 

        (i)    the
Trustee shall not be deemed to have notice of any Default or Event of Default unless a Responsible Officer of the Trustee has actual knowledge thereof or unless
written notice of any event which is in fact such a default is received by the Trustee at the Corporate Trust Office of the Trustee, and such notice references the Securities and this Indenture; 

        (j)    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; 

        (k)   the
Trustee may request that the Issuer or Parent deliver an Officer's 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 Officer's Certificate may be signed by any Person authorized to sign an Officer's Certificate, including any Person specified as so
authorized in any such certificate previously delivered and not superseded; 

        (l)    before
the Trustee acts or refrains from acting with respect to any matter contemplated by this Indenture, it may require an Officer's Certificate or an Opinion of
Counsel, and the Trustee shall be protected and shall not be liable for any action it takes or omits to take in good faith and without gross negligence in reliance on such certificate or opinion; 

44

  

        (m)  the Trustee shall not be required to give any bond or surety in respect of the performance of its power and duties hereunder; and 

        (n)   the
Trustee shall have no duty to inquire as to the performance of the Issuer's or Parent's covenants herein. 

        SECTION
603. Trustee Not Responsible for Recitals or Issuance of Notes. 

        The
recitals contained herein and in the Notes, except for the Trustees certificates of authentication, shall be taken as the statements of the Issuer, and the Trustee assumes no
responsibility for their correctness. The Trustee makes no representations as to the validity or sufficiency of this Indenture or of the Notes, except that the Trustee represents that it is duly
authorized to execute and deliver this Indenture, authenticate the Notes and perform its obligations hereunder and that the statements made by it in a Statement of Eligibility on
Form T-1 supplied to the Issuer are true and accurate, subject to the qualifications set forth therein. The Trustee shall not be accountable for the use or application by the Issuer
of Notes or the proceeds thereof or any money paid to the Issuer or upon the Issuer's direction under any provision of this Indenture. 

        SECTION
604. May Hold Notes. 

        The
Trustee, any Paying Agent, any Note Registrar or any other agent of the Issuer or of the Trustee, in its individual or any other capacity, may become the owner or pledgee of Notes
and, subject to TIA Sections 310(b) and 311, may otherwise deal with the Issuer with the same rights it would have if it were not Trustee, Paying Agent, Note Registrar or such other agent. 

        SECTION
605. Money Held in Trust. 

        Money
held by the Trustee in trust hereunder shall be segregated from other funds. The Trustee shall be under no liability for interest on any money received by it hereunder. 

        SECTION
606. Compensation and Reimbursement. 

        The
Issuer agrees: 

        (1)
to pay to the Trustee from time to time reasonable compensation for all services rendered by it hereunder (which compensation shall not be limited by any provision of law in regard
to the compensation of a trustee of an express trust); 

        (2)
except as otherwise expressly provided herein, to reimburse the Trustee upon its request for all reasonable expenses, disbursements and advances incurred or made by the Trustee in
accordance with any provision of this Indenture (including the reasonable compensation and the expenses and disbursements of its agents, accountants, experts and counsel), except any such expense,
disbursement or advance as may be attributable to its gross negligence or bad faith; and 

        (3)
to indemnify the Trustee and each of its officers, directors, employees, attorneys-in-fact and agents for, and to hold it harmless against, any claim, demand,
loss, liability or expense (including but not limited to reasonable compensation, disbursements and expenses of the Trustee's agents and counsel) incurred without gross negligence or bad faith on its
part, arising out of or in connection with the offering and sale of the Notes, or the acceptance or administration of this trust, including the costs and expenses of defending itself against any claim
or liability in connection with the exercise or performance of any of its powers or duties hereunder and enforcing this indemnification provision. 

        The
obligations of the Issuer under this Section to compensate the Trustee, to pay or reimburse the Trustee for expenses, disbursements and advances and to indemnify and hold harmless
the Trustee shall constitute additional indebtedness hereunder and shall survive the satisfaction and discharge of this Indenture. As security for the performance of such obligations of the Issuer,
the Trustee shall have 

45

 

a
claim prior to the Notes upon all property and funds held or collected by the Trustee as such, except funds held in trust for the payment of principal of (and premium, if any) or interest on
particular Notes. 

        When
the Trustee incurs expenses or renders services in connection with an Event of Default specified in Section 501(8) or (9), the expenses (including the reasonable charges and
expenses of its counsel) of and the compensation for such services are intended to constitute expenses of administration under any applicable Federal or State bankruptcy, insolvency or other similar
law. 

        The
provisions of this Section shall survive the resignation or removal of the Trustee or the termination or discharge of this Indenture. 

        SECTION
607. Corporate Trustee Required; Eligibility. 

        There
shall be at all times a Trustee hereunder which shall be eligible to act as Trustee under TIA Section 310(a)(1) and shall have a combined capital and surplus of at least
$50,000,000. If such corporation publishes reports of condition at least annually, pursuant to law or to the requirements of Federal, State, territorial or District of Columbia supervising or
examining authority, then for the purposes of this Section, the combined capital and surplus of such corporation shall be deemed to be its combined capital and surplus as set forth in its most recent
report of condition so published. If at any time the Trustee shall cease to be eligible in accordance with the provisions of this Section 607, it shall resign immediately in the manner and with
the effect hereinafter specified in this Article. 

        SECTION
608. Resignation and Removal; Appointment of Successor. 

        (a)    No
resignation or removal of the Trustee and no appointment of a successor Trustee pursuant to this Article shall become effective until the acceptance of appointment by
the successor Trustee in accordance with the applicable requirements of Section 609. 

        (b)    The
Trustee may resign at any time by giving written notice thereof to the Issuer. If the instrument of acceptance by a successor Trustee required by Section 609
shall not have been delivered to the Trustee within 30 days after the giving of such notice of resignation, the resigning Trustee may petition any court of competent jurisdiction for the
appointment of a successor Trustee. 

        (c)    The
Trustee may be removed at any time by Act of the Holders of not less than a majority in principal amount of the Outstanding Notes, delivered in writing to the
Trustee and to the Issuer. 

        (d)    If
at any time: 

        (1)
the Trustee shall fail to comply with the provisions of TIA Section 310(b) after written request therefor by the Issuer or by any Holder who has been a bona fide Holder of a
Note for at least six months, or 

        (2)
the Trustee shall cease to be eligible under Section 607 and shall fail to resign after written request therefor by the Issuer or by any Holder who has been a bona fide Holder
of a Note for at least six months, or 

        (3)
the Trustee shall become incapable of acting or shall be adjudged a bankrupt or insolvent or a receiver of the Trustee or of its property shall be appointed or any public officer
shall take charge or control of the Trustee or of its property or affairs for the purpose of rehabilitation, conservation or liquidation, 

then,
in any such case, (i) the Issuer, by a Board Resolution, may remove the Trustee, or (ii) subject to TIA Section 315(e), any Holder who has been a bona fide Holder of a Note
for at least six months may, on behalf of himself and all others similarly situated, petition any court of competent jurisdiction for the removal of the Trustee and the appointment of a successor
Trustee. 

46

 

        (e)    If
the Trustee shall resign, be removed or become incapable of acting, or if a vacancy shall occur in the office of Trustee for any cause, the Issuer, by a Board
Resolution, shall promptly appoint a successor Trustee. If, within one year after such resignation, removal or incapability, or the occurrence of such vacancy, a successor Trustee shall be appointed
by Act of the Holders of a majority in principal amount of the Outstanding Notes delivered to the Issuer and the retiring Trustee, the successor Trustee so appointed shall, forthwith upon its
acceptance of such appointment, become the successor Trustee and supersede the successor Trustee appointed by the Issuer. If no successor Trustee shall have been so appointed by the Issuer or the
Holders and accepted appointment in the manner hereinafter provided, any Holder who has been a bona fide Holder of a Note for at least six months may, on behalf of himself and all others similarly
situated, petition any court of competent jurisdiction for the appointment of a successor Trustee. 

        (f)    The
Issuer shall give notice of each resignation and each removal of the Trustee and each appointment of a successor Trustee to the Holders of Notes in the manner
provided for in Section 106. Each notice shall include the name of the successor Trustee and the address of its Corporate Trust Office. 

        SECTION
609. Acceptance of Appointment by Successor. 

        Every
successor Trustee appointed hereunder shall execute, acknowledge and deliver to the Issuer and to the retiring Trustee an instrument accepting such appointment, and thereupon the
resignation or removal of the retiring Trustee shall become effective and such successor Trustee, without any further act, deed or conveyance, shall become vested with all the rights, powers, trusts
and duties of the
retiring Trustee; but, on request of the Issuer or the successor Trustee, such retiring Trustee shall, upon payment of its charges, execute and deliver an instrument transferring to such successor
Trustee all the rights, powers and trusts of the retiring Trustee and shall duly assign, transfer and deliver to such successor Trustee all property and money held by such retiring Trustee hereunder.
Upon request of any such successor Trustee, the Issuer shall execute any and all instruments for more fully and certainly vesting in and confirming to such successor Trustee all such rights, powers
and trusts. 

        No
successor Trustee shall accept its appointment unless at the time of such acceptance such successor Trustee shall be qualified and eligible under this Article. 

        SECTION
610. Merger, Conversion, Consolidation or Succession to Business. 

        Any
corporation into which the Trustee may be merged or converted or with which it may be consolidated, or any corporation resulting from any merger, conversion or consolidation to which
the Trustee shall be a party, or any corporation succeeding to all or substantially all of the corporate trust business of the Trustee, shall be the successor of the Trustee hereunder, provided such
corporation shall be otherwise qualified and eligible under this Article, without the execution or filing of any paper or any further act on the part of any of the parties hereto. In case any Notes
shall have been authenticated, but not delivered, by the Trustee then in office, any successor by merger, conversion or consolidation to such authenticating Trustee may adopt such authentication and
deliver the Notes so authenticated with the same effect as if such successor Trustee had itself authenticated such Notes. In case at that time any of the Notes shall not have been authenticated, any
successor Trustee may authenticate such Notes either in the name of any predecessor hereunder or in the name of the successor Trustee. In all such cases such certificates shall have the full force and
effect which this Indenture provides for the certificate of authentication of the Trustee shall have; provided, however, that the right to
adopt the certificate of authentication of any predecessor Trustee or to authenticate Notes in the name of any predecessor Trustee shall apply only to its successor or successors by merger, conversion
or consolidation. 

47

 

 
 

ARTICLE SEVEN    
    
    HOLDERS LISTS AND REPORTS BY TRUSTEE AND ISSUER    
    

        SECTION 701. Disclosure of Names and Addresses of Holders. 

        Every
Holder of Notes, by receiving and holding the same, agrees with the Issuer and the Trustee that none of the Issuer or the Trustee or any agent of either of them shall be held
accountable by reason of the disclosure of any such information as to the names and addresses of the Holders in accordance with TIA Section 312, regardless of the source from which such
information was derived, and that the Trustee shall not be held accountable by reason of mailing any material pursuant to a request made under TIA Section 312(b). 

        SECTION
702. Reports by Trustee. 

        (1)
Within 60 days after May 15 of each year commencing with the first May 15 after the first issuance of Notes, the Trustee shall transmit to the Holders, in the
manner and to the extent provided in TIA Section 313(c), a brief report dated as of such May 15 if required by TIA Section 313(a). 

 
 

ARTICLE EIGHT    
    
    CONSOLIDATION, MERGER, CONVEYANCE, TRANSFER OR LEASE    
    

        SECTION 801. Obligors May Consolidate, Etc., Only on Certain Terms. 

        Neither
of the Obligors shall consolidate with, merge with or into, or sell, convey, transfer, lease or otherwise dispose of all or substantially all of its property and assets (as an
entirety or substantially an entirety in one transaction or a series of related transactions) to, any Person or permit any Person to merge with or into such Obligor and it will not permit any of its
Restricted Subsidiaries to enter into any such transaction or series of transactions if such transaction or series of transactions, in the aggregate, would result in the sale, assignment, conveyance,
transfer, lease or other disposition of all or substantially all of such Obligor's properties and assets or of such Obligor and its Restricted Subsidiaries, taken as a whole, to any other Person or
Persons, unless: 

        (1)
either (A) such Obligor shall be the continuing Person, or (B) the Person (if other than such Obligor) formed by such consolidation or into which it is merged or that
acquired or leased such property and assets of such Obligor will be a corporation, partnership or trust organized and validly existing under the laws of the United States of America or any
jurisdiction thereof and shall expressly assume (i) by a supplemental indenture, executed and delivered to the Trustee, all of such Obligor's obligations with respect to the Notes or the
Guarantee, as the case may be, and under this Indenture, (ii) all of such Obligor's obligations under the Registration Rights Agreement pursuant to an agreement or agreements reasonably
satisfactory to the Trustee and (iii) if such Obligor is Parent, all of the Obligations of Parent under the Collateral Documents pursuant to agreements or other documents reasonably
satisfactory to the Trustee; 

        (2)
immediately after giving effect to such transaction (and treating any Indebtedness which becomes an obligation of either Obligor or any Restricted Subsidiary in connection with or as
a result of such transaction as having been incurred at the time of such transaction), no Default or Event of Default shall have occurred and be continuing; 

        (3)
immediately after giving effect to such transaction on a pro forma basis (A) in the case of Parent, or any Person becoming the successor obligor to Parent with respect to the
Parent Guarantee, as the case may be, could Incur at least $1.00 of Indebtedness under clause (i) of paragraph (a) of Section 1011 and (B) in the case of the Issuer, or any
Person becoming the 

48

 

successor
obligor to the Issuer with respect to the Notes, as the case may be, could Incur at least $1.00 of Indebtedness under clause (ii) of paragraph (a) of Section 1011; and 

        (4)
such Obligor delivers to the Trustee an Officer's Certificate (attaching the arithmetic computations to demonstrate compliance with clause (3)) and Opinion of Counsel stating
that such consolidation, merger sale, assignment, conveyance, transfer lease or other disposition and, if a supplemental indenture is required in connection with such transaction, that such
supplemental indenture complies with this Article and that all conditions precedent provided for herein relating to such transaction have been complied with; provided,
however, that clause (3) above does not apply if, in the good faith determination of the Board of Directors of Parent or the Issuer, as the case may be, whose
determination shall be conclusive and evidenced by a Board Resolution, the principal purpose of such transaction is to change its state of incorporation; and provided
further that any such transaction shall not have as one of its purposes the evasion of the foregoing limitations. 

        Notwithstanding
the foregoing paragraph, (A) the Issuer shall not consolidate with, merge with or into, or sell, convey, transfer, lease or otherwise dispose of all or
substantially all of its property and assets (as an entirety or substantially an entirety in one transaction or a series of related transactions) to, Parent, (B) Parent shall not consolidate
with, merge with on into, or sell, convey, transfer, lease or otherwise dispose of all or substantially all of its property and assets (as an entirety or substantially an entirety in one transaction
or a series of related transactions) to, the Issuer, and (C) at no time shall Parent have any direct Investment in any Restricted Subsidiary other than its ownership of the Voting Stock of the
Issuer, provided that this clause (C) shall not be deemed to be violated in respect of any Contingently Transferable Subsidiary or any of its Subsidiaries (existing on the Closing Date or
thereafter created or acquired) prior to that Contingently Transferable Subsidiary becoming a Subsidiary of the Issuer, provided that no Subsidiary of a Contingently Transferable Subsidiary is or
becomes a direct Subsidiary of Parent. 

        SECTION
802. Successor Substituted. 

        Upon
any consolidation of an Obligor with or merger of an Obligor with or into any other corporation or any conveyance, transfer or lease of the properties and assets of an Obligor
substantially as an entirety to any Person in accordance with Section 801, the successor Person formed by such consolidation or into which such Obligor is merged or to which such conveyance,
transfer or lease is made shall succeed to, and be substituted for, and may exercise every right and power of, such Obligor under this Indenture with the same effect as if such successor Person had
been named as such Obligor herein, and in the event of any such conveyance or transfer, such Obligor, except in the case of a lease, shall be discharged of all obligations and covenants under this
Indenture and the Notes and may be dissolved and liquidated. 

        SECTION
803. Notes to Be Secured in Certain Events. 

        If,
upon any such consolidation of an Obligor with or merger of an Obligor into any other corporation, or upon any conveyance, lease or transfer of the property of an Obligor
substantially as an entirety to any other Person, any property or assets of such Obligor would thereupon become subject to any Lien, then unless such Lien could be created pursuant to
Section 1016 without equally and ratably securing the Notes or the Parent Guarantee, as the case may be, such Obligor, prior to or simultaneously with such consolidation, merger, conveyance,
lease or transfer, will as to such property or assets, secure the Notes or the Parent Guarantee, as the case may be, in respect of the Notes Outstanding (together with, if such Obligor shall so
determine any other Indebtedness of such Obligor now existing or hereinafter created which is not subordinate in right of payment to the Notes or the Parent Guarantee, as the case may be) equally and
ratably with (or prior to) the Indebtedness which upon such consolidation, merger, conveyance, lease or transfer is to become secured as to such 

49

 

property
or assets by such Lien, or will cause such Notes or the Parent Guarantee in respect thereof, as the case may be, to be so secured. 

 
 

ARTICLE NINE    
    
    SUPPLEMENTAL INDENTURES    
    

        SECTION
901. Supplemental Indentures Without Consent of Holders. 

        Without
the consent of any Holders, the Obligors, when authorized by Board Resolutions, and the Trustee, at any time and from time to time, may enter into one or more indentures
supplemental hereto, in form satisfactory to the Trustee, for any of the following purposes: 

        (1)
to evidence and provide for the acceptance of appointment hereunder by a successor Trustee pursuant to the requirements of Section 609; or 

        (2)
to cure any ambiguity, defect or inconsistency; or 

        (3)
to secure the Notes pursuant to the requirements of Section 803 or Section 1016 or otherwise; or 

        (4)
to provide for the issuance of Additional Notes; provided that such issuance shall otherwise be in accordance with the terms of the Indenture, including
Section 1011; or 

        (5)
to provide for uncertificated Notes in addition to or in place of certificated Notes; provided, however, that the
uncertificated Notes are issued in registered form for purposes of Section 163(f) of the Code or in a manner such that the uncertificated Securities are as described in
Section 163(f)(2)(B) of the Code; or 

        (6)
to provide for the assumption of an Obligor's obligations to Holders of Notes in the case of a merger or consolidation or sale of all or substantially all of the Obligor's assets; or 

        (7)
to make any change that would provide any additional rights or benefits to the Holders or that does not adversely affect the legal rights under this Indenture or the Collateral
Documents of any such Holder or to confirm and evidence the release, termination or discharge of any Lien securing the Parent Guarantee which release, termination or discharge is permitted by this
Indenture and the Collateral Documents; or 

        (8)
to provide for the release of a Guarantee of the Notes by a Restricted Subsidiary of the Issuer which release is otherwise permitted under this Indenture and would not result in a
Default or Event of Default; or 

        (9)
to conform the text of this Indenture or the Notes to any provision of the "Description of Notes" contained in the Offering Memorandum of the Obligors dated January 13, 2004
relating to the Notes, to the extent that such text was intended to be a verbatim recitation of such provision; or 

        (10)
to comply with the requirements of the Commission in order to effect or maintain the qualification of this Indenture under the Trust Indenture Act. 

        SECTION
902. Supplemental Indentures with Consent of Holders. 

        With
the consent of the Holders of not less than a majority in aggregate principal amount of the Outstanding Notes, by Act of said Holders delivered to the Issuer or Parent and the
Trustee, the Obligors, when authorized by Board Resolutions, and the Trustee may enter into an indenture or indentures supplemental hereto for the purpose of adding any provisions to or changing in
any manner or eliminating any of the provisions of this Indenture or of modifying in any manner the rights of the 

50

 

Holders
under this Indenture; provided, however, that no such supplemental indenture shall, without the consent of the Holder of each
Outstanding Note affected thereby: 

        (1)
change the Stated Maturity of the principal of or any installment of interest on any Note, or reduce the principal amount thereof (or premium or Additional Interest, if any) or the
rate of interest thereon or change the coin or currency in which any Note or any premium or the interest thereon is payable or extend the time for the payment of interest, or alter the redemption
provisions of, any Note, or impair the right of any Holder of the Notes to receive payment of, principal of and interest on such Holder's Notes on or after the due dates therefor or to institute suit
for the enforcement of any payment on or after the Stated Maturity (or, in the case of redemption, on or after the Redemption Date) of any Note; or 

        (2)
reduce the percentage in principal amount of the Outstanding Notes, the consent of whose Holders is required for any such supplemental indenture, or the consent of whose Holders is
required for any waiver of compliance with certain provisions of this Indenture or certain defaults hereunder and their consequences provided for in this Indenture; or 

        (3)
waive a default in the payment of principal of (or premium, if any) or accrued and unpaid interest or Additional Interest, if any, on the Notes; or 

        (4)
modify any provision of any Guarantees of the Notes in a manner adverse to the Holders; or 

        (5)
modify any of the provisions of this Section or Sections 513 and Section 1022, except to increase any such percentage or to provide that certain other provisions of this
Indenture cannot be modified or waived without the consent of the Holder of each Outstanding Note affected thereby; or 

        (6)
change the currency of payment of principal of, or premium if any, or interest on any Note; or 

        (7)
amend or modify any of the provisions of the Collateral Documents in any manner adverse to the Holders of the Notes or release any of the Collateral from the Liens under the
Collateral Documents except (a) in accordance with the terms of such documents and this Indenture or (b) as permitted by Section 901. 

        It
shall not be necessary for any Act of Holders under this Section to approve the particular form of any proposed supplemental indenture, but it shall be sufficient if such Act shall
approve the substance thereof. 

        SECTION
903. Execution of Supplemental Indentures. 

        In
executing, or accepting the additional trusts created by, any supplemental indenture permitted by this Article or the modifications thereby of the trusts created by this Indenture,
the Trustee shall be entitled to receive, and shall be fully protected in relying upon, an Opinion of Counsel stating that the execution of such supplemental indenture is authorized or permitted by
this Indenture. The Trustee may, but shall not be obligated to, enter into any such supplemental indenture which affects the Trustees own rights, duties or immunities under this Indenture or
otherwise. 

        SECTION
904. Effect of Supplemental Indentures. 

        Upon
the execution of any supplemental indenture under this Article, this Indenture shall be modified in accordance therewith, and such supplemental indenture shall form a part of
this Indenture for all purposes; and every Holder of Notes theretofore or thereafter authenticated and delivered hereunder shall be bound thereby. 

51

   
        SECTION 905. Conformity with Trust Indenture Act. 

        Every
supplemental indenture executed pursuant to the Article shall conform to the requirements of the Trust Indenture Act as then in effect. 

        SECTION
906. Reference in Notes to Supplemental Indentures. 

        Notes
authenticated and delivered after the execution of any supplemental indenture pursuant to this Article may, and shall if required by the Trustee, bear a notation in form approved
by the Trustee as to any matter provided for in such supplemental indenture. If the Issuer shall so determine, new Notes so modified as to conform, in the opinion of the Trustee and the Issuer, to any
such supplemental indenture may be prepared and executed by the Issuer and upon Issuer Order authenticated and delivered by the Trustee in exchange for Outstanding Notes. 

        SECTION
907. Notice of Supplemental Indentures. 

        Promptly
after the execution by the Obligors and the Trustee of any supplemental indenture pursuant to the provisions of Section 902, the Issuer shall give notice thereof to the
Holders of each Outstanding Note affected, in the manner provided for in Section 106, setting forth in general terms the substance of such supplemental indenture. 

ARTICLE TEN  

 COVENANTS  

        SECTION 1001. Payment of Principal, Premium, if Any, and Interest. 

        The
Issuer covenants and agrees for the benefit of the Holders that it will duly and punctually pay the principal of (and premium, if any) and interest and Additional Interest, if any,
on the Notes in accordance with the terms of the Notes and this Indenture. 

        SECTION
1002. Maintenance of Office or Agency. 

        The
Issuer will maintain in The City of New York, an office or agency (which may be a drop facility) where Notes may be presented or surrendered for payment, where Notes may be
surrendered for registration of transfer or exchange and where notices and demands to or upon the Issuer in respect of the Notes and this Indenture may be served. The Trustee's Corporate Trust Office
shall initially be such office or agency for all such purposes. The Issuer will give prompt written notice to the Trustee of any change in the location of any such office or agency. If at any time the
Issuer shall fail to maintain any such required office or agency or shall fail to furnish the Trustee with the address thereof, such presentations, surrenders, notices and demands may be made or
served at the Richmond, Virginia address of the Trustee specified in the definition of "Corporate Trust Office," and the Issuer hereby appoints the Trustee as its agent to receive all such
presentations, surrenders, notices and demands. 

        The
Issuer may also from time to time designate one or more other offices or agencies (in or outside of The City of New York) where the Notes may be presented or surrendered for any or
all such purposes and may from time to time rescind any such designation; provided, however, that no such designation or rescission shall in
any manner relieve the Issuer of its obligation to maintain an office or agency in The City of New York for such purposes. The Issuer will give prompt written notice to the Trustee of any such
designation or rescission and any change in the location of any such other office or agency. 

        SECTION
1003. Money for Note Payments to Be Held in Trust. 

        If
the Issuer shall at any time act as its own Paying Agent, it will, on or before each due date of the principal of (or premium or Additional Interest, if any) or interest on any of the
Notes, segregate and hold in trust for the benefit of the Persons entitled thereto a sum sufficient to pay the principal of (or premium or Additional Interest, if any) or interest so becoming due
until such sums shall be paid 

52

 

to
such Persons or otherwise disposed of as herein provided and will promptly notify the Trustee in writing of its action or failure so to act. 

        Whenever
the Issuer shall have one or more Paying Agents for the Notes, it will, on or before each due date of the principal of (or premium or Additional Interest, if any) or interest on
any Notes, deposit with a Paying Agent a sum sufficient to pay the principal (and premium and Additional
Interest, if any) or interest so becoming due, such sum to be held in trust for the benefit of the Persons entitled to such principal, premium, Additional Interest or interest, and (unless such Paying
Agent is the Trustee) the Issuer will promptly notify the Trustee in writing of such action or any failure so to act. 

        The
Issuer will cause each Paying Agent (other than the Trustee) to execute and deliver to the Trustee an instrument in which such Paying Agent shall agree with the Trustee, subject to
the provisions of this Section, that such Paying Agent will: 

        (1)   hold
all sums held by it for the payment of the principal of (and premium and Additional Interest, if any) or interest on Notes in trust for the benefit of the Persons
entitled thereto until such sums shall be paid to such Persons or otherwise disposed of as herein provided; 

        (2)   give
the Trustee notice of any default by the Issuer (or any other obligor upon the Notes) in the making of any payment of principal (and premium and Additional
Interest, if any) or interest on the Notes; and 

        (3)   at
any time during the continuance of any such default, upon the written request of the Trustee, forthwith pay to the Trustee all sums so held in trust by such Paying
Agent. 

        The
Issuer may at any time, for the purpose of obtaining the satisfaction and discharge of this Indenture or for any other purpose, pay, or by Issuer Order direct any Paying Agent to
pay, to the Trustee all sums held in trust by the Issuer or such Paying Agent, such sums to be held by the Trustee upon the same terms as those upon which such sums were held by the Issuer or such
Paying Agent; and, upon such payment by any Paying Agent to the Trustee, such Paying Agent shall be released from all further liability with respect to such sums. 

        Any
money deposited with the Trustee or any Paying Agent, or then held by the Issuer, in trust for the payment of the principal of (or premium or Additional Interest, if any) or interest
on any Note and remaining unclaimed for two years after such principal, premium, Additional Interest or interest has become due and payable shall be paid to the Issuer on Issuer Request, or (if then
held by the Issuer) shall be discharged from such trust; and the Holder of such Note shall thereafter, as an unsecured general creditor, look only to the Issuer for payment thereof, and all liability
of the Trustee or such Paying Agent with respect to such trust money, and all liability of the Issuer as trustee thereof, shall thereupon cease; provided,
however, that the Trustee or such Paying Agent, before being required to make any such repayment, may at the expense of the Issuer cause to be published once, in a
newspaper published in the English language, customarily published on each Business Day and of general circulation in the Borough of Manhattan, The City of New York, notice that such money remains
unclaimed and that, after a date specified therein, which shall not be less than 30 days from the date of such publication, any unclaimed balance of such money then remaining will be repaid to
the Issuer. 

        SECTION
1004. Corporate Existence. 

        Subject
to Article Eight, Parent and Issuer will do or cause to be done all things necessary to preserve and keep in full force and effect the corporate existence, rights (charter and
statutory) and franchises of Parent and each of their respective Subsidiaries; provided, however, that Parent shall not be required to
preserve any such right or franchise if the Board of Directors of Parent shall determine that the preservation thereof is no longer desirable in the conduct of the business of Parent and its
Subsidiaries as a whole and that the loss thereof is not disadvantageous in any material respect to the Holders. 

53

 

        SECTION
1005. Payment of Taxes and Other Claims. 

        Parent
will pay or discharge or cause to be paid or discharged, before the same shall become delinquent, (a) all taxes, assessments and governmental charges levied or imposed upon
Parent or any of its Subsidiaries or upon the income, profits or property of Parent or any of its Subsidiaries and (b) all lawful claims for labor, materials and supplies, which, if unpaid,
might by law become a Lien upon the property of Parent or any of its Subsidiaries; provided, however, that Parent shall not be required to pay
or discharge or cause to be paid or discharged any such tax, assessment, charge or claim whose amount, applicability or validity is being contested in good faith by appropriate proceedings. 

        SECTION
1006. Maintenance of Properties. 

        Parent
will cause all properties owned by Parent or any of its Subsidiaries or used or held for use in the conduct of its business or the business of any of its Subsidiaries to be
maintained and kept in good condition, repair and working order and supplied with all necessary equipment and will cause to be made all necessary repairs, renewals, replacements, betterments and
improvements thereof, all as in the judgment of Parent may be necessary so that the business carried on in connection therewith may be properly and advantageously conducted at all times;
provided, however, that nothing in this Section shall prevent Parent from discontinuing the maintenance of any of such properties if such
discontinuance is, in the judgment of Parent, desirable in the conduct of its business or the business of any of its Subsidiaries and not disadvantageous in any material respect to the Holders. 

        SECTION
1007. Insurance. 

        Parent
will at all times keep all of its and its Subsidiaries properties which are of an insurable nature insured with insurers, believed by Parent to be responsible, against loss or
damage to the extent that
property of similar character is usually so insured by corporations similarly situated and owning like properties. 

        SECTION
1008. Statement by Officers As to Default. 

        (a)
Parent will deliver to the Trustee, within 90 days after the end of each fiscal year, a brief certificate from the principal executive officer, principal financial officer or
principal accounting officer as to his or her knowledge of Parent's and the Issuer's compliance with all conditions and covenants under this Indenture. For purposes of this Section 1008(a),
such compliance shall be determined without regard to any period of grace or requirement of notice under this Indenture. 

        (b)
When any Default has occurred and is continuing under this Indenture, or if the trustee for or the holder of any other evidence of Indebtedness of Parent or any of its Subsidiary
gives any notice or takes any other action with respect to a claimed default (other than with respect to Indebtedness in the principal amount of less than $1,000,000), Parent shall deliver to the
Trustee by registered or certified mail or by telegram, telex or facsimile transmission an Officer's Certificate specifying such event, notice or other action within five Business Days of its
occurrence. 

        (c)
When any Registration Default (as defined in the Registration Rights Agreement) occurs, the Issuer shall promptly deliver to the Trustee by registered or certified mail or by
telegram, telex or facsimile transmission an Officer's Certificate specifying the nature of such Registration Default. In addition, the Issuer shall deliver to the Trustee on each Interest Payment
Date during the continuance of a Registration Default and on the Interest Payment Date following the cure of a Registration Default, an Officer's Certificate specifying the amount of Additional
Interest which have accrued and which are then owing under the Registration Rights Agreement. 

54

 

        SECTION
1009. Provision of Financial Statements. 

        (a)
Parent will file on a timely basis with the Commission, to the extent such filings are accepted by the Commission and whether or not it has a class of securities registered under the
Exchange Act, the annual reports, quarterly reports and other documents that it would be required to file if it were subject to Section 13 or 15 of the Exchange Act which annual reports and
quarterly reports must include the condensed consolidating financial information with respect to the Issuer required by Rule 3-10 of Regulation S-X under the
Exchange Act. All such annual reports shall include the geographic segment financial information contemplated by Item 101(d) of Regulation S-K under the Securities Act and all such
quarterly reports shall provide the
same type of interim financial information that, as of the date of this Indenture, currently is its practice to provide. 

        (b)
Parent also will be required (i) to file with the Trustee, and provide to each Holder, without cost to such Holder, copies of such reports and documents within 15 days
after the date on which Parent files such reports and documents with the Commission or the date on which Parent would be required to file such reports and documents if it were so required, provided
that for purposes of this clause (i), such reports and documents shall be deemed to have been furnished if they are electronically available via the Commission's EDGAR System, and
(ii) if filing such reports and documents with the Commission is not accepted by the Commission or is prohibited under the Exchange Act, to supply at Parent's cost copies of such reports and
documents to any prospective Holder promptly upon request. 

        SECTION
1010. Repurchase of Notes upon a Change of Control. 

        (a)
Upon the occurrence of a Change of Control, each Holder shall have the right to require the Issuer to repurchase all or any part of its Notes at a purchase price in cash pursuant to
the offer described below (the "Change of Control Offer") equal to 101% of the principal amount thereof, plus accrued and unpaid interest and Additional Interest, if any, to the date of purchase
(subject to the right of Holders of record to receive interest on the relevant interest payment date) (the "Change of Control Payment"). 

        (b)
[Intentionally Omitted] 

        (c)
Within 45 days (but in the case of notice to the Trustee, as soon as practicable) following any Change of Control, the Issuer shall give to each Holder of the Notes and the
Trustee in the manner provided in Section 106 a notice stating: 

        (i)
that a Change of Control has occurred, that the Change of Control Offer is being made pursuant to this Section 1010 and that all Notes validly tendered will be accepted for
payment; 

        (ii)
the purchase price and the date of purchase (which shall be a Business Day no earlier than 30 days nor later than 60 days from the date such notice is mailed) (the
"Change of Control Payment Date"); 

        (iii)
that any Note not tendered will continue to accrue interest and Additional Interest, if any, pursuant to its terms; 

        (iv)
that, unless the Issuer defaults in the payment of the Change of Control Payment, any Note accepted for payment pursuant to the Change of Control Offer shall cease to accrue
interest and Additional Interest, if any, on and after the Change of Control Payment Date; 

        (v)
that Holders electing to have any Note or portion thereof purchased pursuant to the Change of Control Offer will be required to surrender such Note, together with the form entitled
"Option of the Holder to Elect Purchase" on the reverse side of such Note completed, to the Paying Agent at the address specified in the notice prior to the close of business on the third Business Day
immediately preceding the Change of Control Payment Date; 

55

 

        (vi)
that Holders will be entitled to withdraw their election if the Paying Agent receives, not later than the close of business on the third Business Day immediately preceding the
Change of Control Payment Date, a telegram, telex, facsimile transmission or letter setting forth the name of such Holder, the principal amount of Notes delivered for purchase and a statement that
such Holder is withdrawing his election to have such Notes purchased; and 

        (vii)
that Holders whose Notes are being purchased only in part will be issued new Notes equal in principal amount to the unpurchased portion of the Notes surrendered; provided that each
Note purchased and each new Note issued shall be in a principal amount of $1,000 or integral multiples thereof. 

        (d)
[Intentionally Omitted] 

        (e)
On the Change of Control Payment Date, the Issuer shall: 

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

        (ii)
deposit with the Paying Agent money sufficient to pay the purchase price of all Notes or portions thereof so accepted; and 

        (iii)
deliver, or cause to be delivered, to the Trustee, all Notes or portions thereof so accepted together with an Officer's Certificate specifying the Notes or portions thereof
accepted for payment by the Issuer. 

        The
Paying Agent promptly shall mail, to the Holders of Notes so accepted, payment in an amount equal to the purchase price, and the Trustee promptly shall authenticate and mail to such
Holders a new Note equal in principal amount of any unpurchased portion of the Notes surrendered; provided that each Note purchased and each new Note issued shall be in a principal amount of $1,000 or
integral multiples thereof. The Issuer will announce publicly the results of the Change of Control Offer on or as soon as practicable after the Change of Control Payment Date. For purposes of this
Section 1010, the Trustee shall act as Paying Agent. 

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

        The
Issuer will comply with Rule 14e-1 under the Exchange Act and any other securities laws and regulations thereunder to the extent such laws and regulations are
applicable in the event that a Change of Control occurs and the Issuer is required to repurchase the Notes under this Section 1010. 

        SECTION
1011. Limitation on Indebtedness. 

        (a)
Parent will not, and will not permit any of its Restricted Subsidiaries to, Incur any Indebtedness, including Acquired Indebtedness (other than Existing Indebtedness and the Notes
issued on the Closing Date); provided, however, that: 

        (i)
Parent may Incur Indebtedness, including Acquired Indebtedness, if immediately thereafter the ratio (the "Parent Indebtedness to Consolidated Cash Flow Ratio") of: 

        (A)
the aggregate principal amount (or accreted value, as the case may be) of Indebtedness of Parent and its Restricted Subsidiaries on a consolidated basis outstanding as of the
Transaction Date to 

        (B)
the Pro Forma Consolidated Cash Flow of Parent for the preceding two full fiscal quarters multiplied by two, determined on a pro forma basis as if any such Indebtedness that 

56

 

had
been Incurred and the proceeds thereof had been applied at the beginning of such two fiscal quarters, 

        would
be greater than zero and less than 5.0 to 1.0; and 

        (ii)
the Issuer and any of its Restricted Subsidiaries may Incur Indebtedness, including Acquired Indebtedness, if immediately thereafter the ratio (the "Issuer Indebtedness to
Consolidated Cash Flow Ratio") of: 

        (A)
the aggregate principal amount (or accreted value, as the case may be) of Indebtedness of the Issuer and its Restricted Subsidiaries on a consolidated basis outstanding as of the
Transaction Date to 

        (B)
the Pro Forma Consolidated Cash Flow of the Issuer for the preceding two full fiscal quarters multiplied by two, determined on a pro forma basis as if any such Indebtedness that had
been Incurred and the proceeds thereof had been applied at the beginning of such two fiscal quarters, 

would
be greater than zero and less than 3.5 to 1.0. 

        (b)
Notwithstanding the foregoing, Parent, the Issuer and any other Restricted Subsidiary of Parent may Incur each and all of the following: 

        (i)
Indebtedness of Parent or any of its Restricted Subsidiaries under one or more Credit Facilities in an aggregate principal amount at any one time outstanding not to exceed the
greater of: 

        (a)
$50 million; or 

        (b)
65% of Eligible Accounts Receivable, subject to any permanent reductions required by any other terms of this Indenture; 

        (ii)
Indebtedness (including Guarantees) Incurred by Parent or a Restricted Subsidiary of Parent after the Closing Date to finance the cost (including the cost of design, development,
construction, acquisition, installation or integration) of equipment used in a Permitted Business or ownership rights with respect to indefeasible rights of use or minimum investment units (or similar
ownership interests) in domestic or transnational fiber optic cable or other transmission facilities, in each case purchased or leased by Parent or a Restricted Subsidiary of Parent after the Closing
Date (including acquisitions by way of Capitalized Leases and acquisitions of the Capital Stock of a Person that becomes a Restricted Subsidiary of Parent to the extent of the Fair Market Value (as
determined in good faith by the Board of Directors of Parent, whose determination shall be conclusive and evidenced by a Board Resolution) of such equipment, ownership rights or minimum investment
units so acquired), provided, that the amount of Indebtedness incurred under this clause (ii) shall not exceed $50.0 million in the aggregate at any one time
outstanding; 

        (iii)
Indebtedness of any Restricted Subsidiary of Parent to Parent or Indebtedness of Parent or any of its Restricted Subsidiaries to any other of its Restricted Subsidiaries;
provided that any subsequent issuance or transfer of any Capital Stock which results in any such Restricted Subsidiary ceasing to be a Restricted Subsidiary of Parent or
any subsequent transfer of such Indebtedness permitted by this clause (iii) (other than to Parent or another Restricted Subsidiary of Parent) shall be deemed, in each case, to constitute the
incurrence of such Indebtedness; and provided further that Indebtedness to a Restricted Subsidiary of Parent (other than the Issuer or a Guarantor) must be subordinated in
right of payment to the Notes or any applicable Guarantee, as the case may be; 

        (iv)
Indebtedness of Parent or a Restricted Subsidiary of Parent issued in exchange for, or the net proceeds of which are used to refinance or refund, then outstanding Indebtedness of
Parent or 

57

 

a
Restricted Subsidiary of Parent, other than Indebtedness Incurred under clauses (i), (iii), (v), (viii), (ix) and (x) of this paragraph, and any refinancings thereof in an amount not
to exceed the amount so refinanced or refunded (plus premiums, accrued interest, and reasonable fees and expenses); provided that such new Indebtedness shall only be
permitted under this clause (iv) if 

        (A)
in case the Notes are refinanced in part or the Indebtedness to be refinanced is pari passu with the Notes or any applicable
Guarantee, such new Indebtedness, by its terms or by the terms of any agreement or instrument pursuant to which such new Indebtedness is issued or remains outstanding, is expressly made  pari passu with,
or subordinate in right of payment to, the remaining Notes or the applicable Guarantee, 

        (B)
in case the Indebtedness to be refinanced is subordinated in right of payment to the Notes or any applicable Guarantee, such new Indebtedness, by its terms or by the terms of any
agreement or instrument pursuant to which such new Indebtedness is issued or remains outstanding, is made subordinate expressly in right of payment to the Notes or the applicable Guarantee at least to
the
extent that the Indebtedness to be refinanced is subordinated to the Notes and the applicable Guarantee, and 

        (C)
such new Indebtedness, determined as of the date of Incurrence of such new Indebtedness, does not mature prior to the Stated Maturity of the Indebtedness to be refinanced or
refunded, and the Average Life of such new Indebtedness is at least equal to the remaining Average Life of the Indebtedness to be refinanced or refunded; and provided
further that in no event may (1) Indebtedness of Parent be refinanced by means of any Indebtedness of any Restricted Subsidiary of Parent pursuant to this clause (iv) and
(2) Indebtedness of the Issuer be refinanced by means of any Indebtedness of any Restricted Subsidiary of the Issuer pursuant to this clause (iv); 

        (v)
Indebtedness of Parent or any Restricted Subsidiary of Parent: 

        (A)
in respect of performance, bid, surety or appeal bonds, completion guarantees or guarantees or warranty of contractual service obligations provided in the ordinary course of
business, and letters of credit or banker's acceptances supporting Trade Payables or covering workers' compensation, errors and omissions insurance, bid and performance, appeal or similar obligations,
in each case provided in the ordinary course of business; 

        (B)
under Currency Agreements and Interest Rate Agreements; provided that such agreements: 

        (a)
are designed solely to protect Parent or any of its Restricted Subsidiaries against fluctuation in foreign currency exchange rates or interest rates, and 

        (b)
do not increase the Indebtedness of the obligor outstanding at any time other than as a result of fluctuations in foreign currency exchange rates or interest rates or by reason of
fees, indemnities and compensation payable thereunder; and 

        (C)
arising from agreements providing for indemnification, adjustment of purchase price or similar obligations, or from Guarantees or letters of credit, surety bonds or performance bonds
securing any obligations of Parent or any of its Restricted Subsidiaries pursuant to such agreements, in any case Incurred in connection with the disposition of any business, assets or Restricted
Subsidiary (other than Guarantees of Indebtedness Incurred by any Person acquiring all or any portion of such business, assets or Restricted Subsidiary of Parent for the purpose of financing such
acquisition), in a principal amount not to exceed the gross proceeds actually received by Parent or any Restricted Subsidiary of Parent in connection with such disposition; 

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        (vi)
Indebtedness of Parent or its Restricted Subsidiaries, as applicable, to the extent that the net proceeds thereof promptly are 

        (A)
used to repurchase, (x) in the case of Indebtedness of the Issuer, Notes tendered in a Change of Control Offer, (y) in the case of Indebtedness of Parent, any debt
securities of Parent or one of its Restricted Subsidiaries tendered pursuant to a change of control offer similar to such Change of Control Offer, or (z) in the case of Indebtedness of a
Restricted Subsidiary of Parent (other than the Issuer), any of the debt securities of that or another Restricted Subsidiary of Parent (other than the Issuer) tendered pursuant to a change of control
offer similar to such Change of Control Offer, or 

        (B)
deposited to defease all, (x) in the case of Indebtedness of the Issuer, of the Notes as described under Article Fourteen, (y) in the case of Indebtedness of Parent, of
the debt securities of Parent or one of its Restricted Subsidiaries (other than the Issuer) of a particular series pursuant to a comparable provision in such securities, or (z) in the case of
Indebtedness of a Restricted Subsidiary of Parent (other than the Issuer), of the debt securities of that or another Restricted Subsidiary of Parent (other than the Issuer) of a particular series
pursuant to a comparable provision in such securities; 

        (vii)
Acquired Indebtedness not to exceed $100 million at any one time outstanding; provided that, as a result of such incurrence,
in the case of Acquired Indebtedness incurred by the Issuer or any of its Restricted Subsidiaries, the Issuer Indebtedness to Consolidated Cash Flow Ratio and, in the case of Acquired Indebtedness
incurred directly by Parent, the Parent Indebtedness to Consolidated Cash Flow Ratio, in each case, at the time of the incurrence of such Acquired Indebtedness and calculated giving pro forma effect
to such incurrence (in accordance with the definition of "Issuer Indebtedness to Consolidated Cash Flow Ratio" or "Parent Indebtedness to Consolidated Cash Flow Ratio," as the case may be) and the
related Asset Acquisition as if the same had occurred at the beginning of the most recently ended two fiscal quarters, would have been less than, in the case of Acquired Indebtedness incurred directly
by the Issuer or any of its Restricted Subsidiaries, the Issuer Indebtedness to Consolidated Cash Flow Ratio and, in the case of Acquired Indebtedness incurred directly by Parent, the Parent
Indebtedness to Consolidated Cash Flow Ratio, respectively, for the same period without giving pro forma effect to such incurrence and Asset Acquisition; 

        (viii)
Indebtedness of a Restricted Subsidiary of Parent represented by a Guarantee of the Notes and any other Indebtedness permitted by and made in accordance with Section 1018; 

        (ix)
Indebtedness of Parent or any Restricted Subsidiary of Parent not otherwise permitted hereunder in an aggregate principal amount which, when aggregated with the principal amount of
all other Indebtedness then outstanding and incurred pursuant to this clause (ix), does not exceed $200 million at any one time outstanding; and 

        (x)
Indebtedness of Parent or any Restricted Subsidiary of Parent arising from the honoring by a bank or other financial institution of a check or similar instrument inadvertently
(except in the case of daylight overdrafts) drawn against insufficient funds in the ordinary course of business, provided that such Indebtedness is extinguished within
three business days of Incurrence. 

        (c)
Notwithstanding any other provision of this Section 1011, the maximum amount of Indebtedness that Parent or a Restricted Subsidiary of Parent may Incur pursuant to this
Section 1011 shall not be deemed to be exceeded with respect to any outstanding Indebtedness due solely to the result of fluctuations in the exchange rates of currencies. 

        (d)
For purposes of determining any particular amount of Indebtedness under this Section 1011, Guarantees, Liens or obligations with respect to letters of credit, in each case
supporting Indebtedness otherwise included in the determination of such particular amount, shall not be included. For purposes 

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of
determining compliance with this Section 1011, in the event that an item of Indebtedness meets the criteria of more than one of the types of Indebtedness described in the above clauses,
Parent in its sole discretion, shall classify and from time to time may reclassify such item of Indebtedness and only be required to include the amount and type of such Indebtedness in one of such
clauses. Indebtedness permitted by this Section 1011 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 1011 permitting such Indebtedness. 

        SECTION
1012. Limitation on Restricted Payments. Parent will not, and will not permit any of its Restricted Subsidiaries directly or indirectly to: 

(i)
(A) declare or pay any dividend or make any distribution in respect of Parent's Capital Stock to the holders thereof (other than dividends or distributions payable solely in shares of Capital
Stock (other
than Redeemable Stock) or in options, warrants or other rights to acquire such shares of Capital Stock), or 

        (B)  declare
or pay any dividend or make any distribution in respect of the Capital Stock of any Restricted Subsidiary of Parent to any Person other than dividends and
distributions payable to Parent or any Restricted Subsidiary of Parent or to all holders of Capital Stock of such Restricted Subsidiary on a pro rata basis; 

        (ii)   purchase,
redeem, retire or otherwise acquire for value any shares of Capital Stock (including options, warrants or other rights to acquire such shares of Capital
Stock) of Parent held by any Person other than a Restricted Subsidiary of Parent; 

        (iii)  make
any voluntary or optional principal payment, or voluntary or optional redemption, repurchase, defeasance, or other acquisition or retirement for value of
Subordinated Indebtedness; or 

        (iv)  make
any Investment, other than a Permitted Investment, in any Person (such payments or any other actions described in clauses (i) through (iv) being
collectively "Restricted Payments"); 

        if,
at the time of, and after giving effect to, the proposed Restricted Payment: 

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

        (B)
Parent could not Incur at least $1.00 of Indebtedness under clause (i) of paragraph (a) of Section 1011; or 

        (C)
the aggregate amount expended for all 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 Board Resolution) after the date of this Indenture shall exceed the sum of: 

        (1)
the remainder of 

        (a)
100% of the aggregate amount of the Consolidated Cash Flow of Parent (determined by excluding income resulting from transfers of assets received by Parent or a Restricted Subsidiary
of Parent from
an Unrestricted Subsidiary) accrued on a cumulative basis during the period (taken as one accounting period) beginning on the first day of Parent's fourth fiscal quarter in 1999 and ending on the last
day of the last full fiscal quarter preceding the Transaction Date, minus 

        (b)
the product of 1.75 times cumulative Consolidated Fixed Charges accrued on a cumulative basis during the period (taken as one accounting period) beginning on the first day of
Parent's fourth fiscal quarter in 1999 and ending on the last day of the last full fiscal quarter preceding the Transaction Date, plus 

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        (2)
the aggregate Net Cash Proceeds received by Parent on or after October 15, 1999 from the issuance and sale of its Capital Stock (other than Redeemable Stock) to a Person who
is not a Subsidiary, plus 

        (3)
the aggregate Net Cash Proceeds received on or after October 15, 1999 by Parent from the issuance or sale of debt securities that have been converted into or exchanged for its
Capital Stock (other than Redeemable Stock) together with the aggregate cash received by us at the time of such conversion or exchange, plus 

        (4)
without duplication of any amount included in the calculation of Consolidated Cash Flow of Parent, in the case of repayment of, or return of capital in respect of, any Investment
constituting a Restricted Payment made on or after October 15, 1999 and reducing the amount of Restricted Payments otherwise permitted under this clause (C), an amount equal to the
lesser of the return of capital with respect to such Investment and the cost of such Investment, in either case less the cost of the disposition of such Investment. 

The
foregoing provision shall not be violated by reason of: 

        (a)
the payment of any dividend within 60 days after the date of declaration thereof if, at said date of declaration, such payment would comply with the foregoing paragraph; 

        (b)
the redemption, repurchase, defeasance or other acquisition or retirement for value of Subordinated Indebtedness of either Obligor (including premium, if any, and accrued and unpaid
interest) with the proceeds of, or in exchange for, Indebtedness of such Obligor Incurred under clause (iv) of paragraph (b) of Section 1011; 

        (c)
the repurchase, redemption or other acquisition of Capital Stock of Parent with the proceeds of, or in exchange for, an offering of shares of Capital Stock of Parent (other than
Redeemable Stock) which proceeds are received or which Capital Stock is exchanged, tendered or surrendered, as the case maybe, no more than 60 days prior to, and no later than the date of, such
repurchase, redemption or other acquisition; 

        (d)
the redemption, repurchase, defeasance or other acquisition or retirement for value of Subordinated Indebtedness of either Obligor (including premium, if any, and accrued and unpaid
interest) with the proceeds of, or in exchange for, an offering of, shares of Capital Stock of Parent (other than Redeemable Stock), which proceeds are received or which Subordinated Indebtedness is
exchanged, surrendered or tendered, as the case may be, no more than 60 days prior to, and no later than the date of, such redemption, repurchase, defeasance or other acquisition or retirement
for value; 

        (e)
payments or distributions to dissenting stockholders pursuant to applicable law, pursuant to or in connection with a consolidation, merger or transfer of assets that complies, if
applicable, with the provisions of this Indenture applicable to mergers, consolidations and transfers of all or substantially all of the property and assets of Parent and its Restricted Subsidiaries
or the Issuer and its Restricted Subsidiaries, as the case may be; 

        (f)
cash payments in lieu of the issuance of fractional shares issued in connection with the exercise of warrants, options or other rights to purchase, or the conversion of securities
convertible into, Capital Stock of Parent or any of its Restricted Subsidiaries; 

        (g)
Investments in Permitted Businesses acquired in exchange for Capital Stock of Parent (other than Redeemable Stock) or with the Net Cash Proceeds from the issuance and sale of such
Capital Stock; 

        (h)
the purchase by an Obligor of any Subordinated Indebtedness of either Obligor at a purchase price not greater than 101% of the principal amount thereof, together with accrued
interest, if any, thereof in the event of a Change of Control in accordance with provisions similar to Section 1010; provided that prior to such
purchase the Issuer has made the Change of Control offer as provided in such covenant with respect to the Notes and has purchased all Notes validly tendered for payment in connection with such Change
of Control Offer; 

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        (i) repurchases of Capital Stock of Parent options, warrants or other rights to acquire such Capital Stock from employees, former employees, directors or former directors (or their heirs
or estates) of Parent or any Restricted Subsidiary in an aggregate amount under this clause (i) not to exceed $5 million in any calendar year; 

        (j)
repurchases of shares of Common Stock of Parent that constitute odd lots, pursuant to a program for the repurchase of odd lots, in an aggregate amount not to exceed the sum of
$2 million in any fiscal year; 

        (k)
Restricted Payments not to exceed $25.0 million; 

        (l)
other Restricted Payments not to exceed $20.0 million in the aggregate during any calendar year (with the entire unused amount in any calendar year, including previously
carried over amounts, being permitted to be carried over for the next succeeding calendar year); provided, that such amount in any calendar year may be increased by an
amount equal to Unclaimed Excess Proceeds (with the entire unused amount in any calendar year, including previously carried over amounts, being permitted to be carried over for the next succeeding
calendar year); provided, further that upon the making of any such Restricted Payment (i) the Parent Indebtedness to Consolidated Cash
Flow Ratio, calculated giving pro forma effect to such Restricted Payment as if the same had been made at the beginning of the most recently ended two fiscal quarters, would be greater than zero and
equal to or less than 3.0 to 1 and (ii) the Issuer Indebtedness to Consolidated Cash Flow Ratio, calculated giving pro forma effect to such Restricted Payment as if the same had been made at
the beginning of the most recently ended two fiscal quarters, would be greater than zero and equal to or less than 1.5 to 1; and 

        (m)
the declaration and payment of dividends or distributions to holders of any class or series of Redeemable Stock of Parent, the Issuer or any Restricted Subsidiary issued or incurred
in accordance with Section 1011, 

provided
that, except in the case of clause (a), no Default or Event of Default shall have occurred and be continuing or occur as a consequence of the actions or
payments set forth therein. 

        Each
Restricted Payment permitted pursuant to the immediately preceding paragraph (other than (1) a Restricted Payment referred to in clause (b) thereof, (2) an
exchange of Capital Stock for Capital Stock
or an exchange of Indebtedness for Capital Stock referred to in clauses (c) or (d) thereof or (3) an exchange of Capital Stock referred to in clause (g) thereof) and the
Net Cash Proceeds from any issuance of Capital Stock referred to in clauses (c), (d) and (g) shall be included in calculating whether the conditions of clause (C) of the first
paragraph of this Section 1012 have been met with respect to any subsequent Restricted Payments. 

        Any
Restricted Payments made other than in cash shall be valued at Fair Market Value as determined by the Board of Directors of Parent (whose determination shall be conclusive and
evidenced by a Board Resolution). The amount of any Investment "outstanding" at any time shall be deemed to be equal to the amount of such Investment on the date made, less the return of capital,
repayment of loans, and release of Guarantees, in each case of or to Parent and its Restricted Subsidiaries with respect to such Investment (up to the amount of such Investment on the date made). 

        SECTION
1013. Limitation on Dividend and Other Payment Restrictions Affecting Restricted Subsidiaries. So long as any of the Notes are Outstanding, Parent
will not, and will not permit any of its Restricted Subsidiaries to, create or otherwise cause or suffer to exist or become effective any consensual encumbrance or restriction of any kind on the
ability of any Restricted Subsidiary of Parent to: 

        (i)
pay dividends or make any other distributions permitted by applicable law on any Capital Stock of such Restricted Subsidiary owned by Parent or any other Restricted Subsidiary; 

        (ii)
pay any indebtedness owed to Parent or any other Restricted Subsidiary; 

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        (iii)
make loans or advances to Parent or any other Restricted Subsidiary; or 

        (iv)
transfer any of its property or assets to Parent or any other Restricted Subsidiary. 

        The
foregoing provisions shall not restrict any encumbrances or restrictions: 

        (i)
existing on the Closing Date in this Indenture, the Collateral Documents or any other agreements in effect on the Closing Date, and any extensions, refinancings, renewals or
replacements of such agreements; provided that the encumbrances and restrictions in any such extensions, refinancings,
renewals or replacements, taken as a whole, are no less favorable in any material respect to the Holders of the Notes than those encumbrances or restrictions that are then in effect and that are being
extended, refinanced, renewed or replaced; 

        (ii)
contained in the terms of any Indebtedness or any agreement pursuant to which such Indebtedness was issued if the encumbrance or restriction applies only in the event of a payment
default or default with respect to a financial covenant contained in such Indebtedness or agreement and such encumbrance or restriction is not materially more disadvantageous to the Holders of the
Notes than is customary in comparable financings (as determined by Parent) and Parent determines that any such encumbrance or restriction will not materially affect the Issuer's ability to make
principal or interest payments on the Notes; 

        (iii)
existing under or by reason of applicable law; 

        (iv)
existing with respect to any Person or the property or assets of such Person acquired by Parent or any Restricted Subsidiary of Parent, existing at the time of such acquisition and
not incurred in contemplation thereof, which encumbrances or restrictions are not applicable to any Person or the property or assets of any Person other than such Person or the property or assets of
such Person so acquired and as the same may be amended, modified, restated, renewed, supplemented, refunded, replaced or refinanced; provided that such amendments,
modifications, restatements, renewals, supplements, refundings, replacements or refinancings, taken as a whole, are no less favorable in any material respect to the Holders of the Notes than those
encumbrances or restrictions that are then in effect and that are being so amended, modified, restated, renewed, supplemented, refunded, replaced or refinanced; 

        (v)
in the case of clause (iv) of the first paragraph of this Section 1013, 

        (A)
that restrict in a customary manner the subletting, assignment or transfer of any property or asset that is, or is subject to, a lease, purchase mortgage obligation, construction
financing agreement, license, conveyance or contract or similar property or asset, including, without limitation, customary non-assignment provisions in leases, Purchase Money Obligations
and other similar agreements, in each case with respect to the property or assets subject thereto, 

        (B)
existing by virtue of any transfer of, agreement to transfer, option or right with respect to, or Lien on, any property or assets of Parent or any Restricted Subsidiary of Parent not
otherwise prohibited by this Indenture, or 

        (C)
arising or agreed to in the ordinary course of business, not relating to any Indebtedness, and that do not, individually or in the aggregate, detract from the value of property or
assets of Parent or any Restricted Subsidiary of Parent in any manner material to Parent or any Restricted Subsidiary; 

        (vi)
with respect to a Restricted Subsidiary of Parent and imposed pursuant to an agreement that has been entered into for the sale or disposition of all or substantially all of the
Capital Stock of, or property and assets of, such Restricted Subsidiary of Parent; or 

63

 

        (vii)
imposed by customary provisions in joint venture agreements and similar agreements that restrict the transfer of the interest in the joint venture. 

        Nothing
contained in this Section 1013 shall prevent Parent or any Restricted Subsidiary of Parent from (1) creating, incurring, assuming or suffering to exist any Liens
otherwise permitted in Section 1016 or (2) restricting the sale or other disposition of property or assets of Parent or any of its Restricted Subsidiaries that secure Indebtedness of
Parent or any of its Restricted Subsidiaries. 

        SECTION
1014. Limitation on the Issuance and Sale of Voting Stock of Restricted Subsidiaries. Parent shall at all times own 100% of the Voting Stock of the
Issuer. Parent will not sell, transfer, convey or otherwise dispose of and will not permit any of its Restricted Subsidiaries, directly or indirectly, to issue, transfer, convey, sell, lease or
otherwise dispose of any shares of Voting Stock (including options, warrants or other rights to purchase shares of such Voting Stock) of such or any other Restricted Subsidiary to any Person except: 

        (i)
to a Restricted Subsidiary of Parent; 

        (ii)
issuances of director's qualifying shares, sales to foreign nationals or directors or employees of Parent or its Restricted Subsidiaries of shares of Voting Stock of
non-U.S. Restricted Subsidiaries of Parent to the extent required by law or to the extent such issuances are required to obtain preferential treatment under law that does not adversely
affect the rights of the Holders of the Notes in any material respect; 

        (iii)
Voting Stock or options or other rights to acquire shares of Voting Stock (or shares of Voting Stock issued upon exercise of such options or other rights) granted to employees or
directors of no more than two Restricted Subsidiaries of Parent designated by Parent and identified in an Officer's Certificate delivered to the Trustee ("Designated Subsidiaries"), pursuant to the
terms of any management equity or compensation plan or stock option plan or any other management or employee benefit plan or other similar agreement or arrangement;
provided, that such Voting Stock, options and other rights to acquire shares, together with the issuance of shares of Voting Stock upon the exercise thereof, shall not
represent more than 5.0% of the fully diluted Voting Stock of any such Restricted
Subsidiary; provided further, that if and only if any Designated Subsidiary ceases to be a Subsidiary of Parent, Parent may designate another Restricted Subsidiary in its
place by identifying that Restricted Subsidiary in an Officer's Certificate delivered to the Trustee and that Restricted Subsidiary shall thereupon be deemed a Designated Subsidiary for all purposes
under this Indenture; and 

        (iv)
issuances and sales of Voting Stock of Restricted Subsidiaries of Parent if: 

        (A)
the Net Cash Proceeds from such issuance, transfer, conveyance, sale, lease or other disposition are applied in accordance with the provisions of Section 1017, and 

        (B)
immediately after giving effect to such issuance, transfer, conveyance, sale, lease or other disposition, such Restricted Subsidiary either continues to be a Restricted Subsidiary
or, if such Restricted Subsidiary would no longer constitute a Restricted Subsidiary, then any Investment in such Person remaining after giving effect to such issuance, transfer, conveyance, sale,
lease or other disposition would have been permitted to be made under Section 1012 if made on the date of such issuance, transfer, conveyance, sale, lease or other disposition (valued as
provided in the definition of "Investment"). 

        Notwithstanding
the foregoing, Parent or any of its Restricted Subsidiaries may sell all of the Voting Stock of a Restricted Subsidiary in compliance with the provisions of
Section 1017. 

        SECTION
1015. Limitation on Transactions with Shareholders and Affiliates. Parent will not, and will not permit any Restricted Subsidiary, directly or
indirectly, to enter into, renew or extend any transaction (including, without limitation, the purchase, sale, lease or exchange of property or assets, or 

64

 

the
rendering of any service) with any holder (or any Affiliate of such holder) of 10% or more of any class of Capital Stock of Parent or with any Affiliate of Parent, unless: 

        (i)
such transaction or series of transactions is on terms no less favorable to Parent or such Restricted Subsidiary than those that could be obtained in a comparable arm's-length
transaction with a Person that is not such a holder or an Affiliate; 

        (ii)
if such transaction or series of transactions involves aggregate consideration in excess of $10.0 million, then such transaction or series of transactions is approved by a
majority of the Board of
Directors of Parent, including the approval of a majority of the independent, disinterested directors, and is evidenced by a resolution of the Board of Directors of Parent; and 

        (iii)
if such transaction or series of transactions involves aggregate consideration in excess of $25.0 million, then Parent or such Restricted Subsidiary will deliver to the
Trustee a written opinion as to the fairness to Parent or such Restricted Subsidiary of such transaction from a financial point of view from a nationally recognized investment banking firm (or, if an
investment banking firm is generally not qualified to give such an opinion, by a nationally recognized appraisal firm or accounting firm). Any such transaction or series of transactions shall be
conclusively deemed to be on terms no less favorable to Parent or such Restricted Subsidiary than those that could be obtained in an arm's-length transaction if such transaction or transactions are
approved by a majority of the Board of Directors of Parent, including a majority of the independent, disinterested directors, and are evidenced by a resolution of the Board of Directors of Parent. 

        The
foregoing limitation does not limit, and will not apply to: 

        (a)
any transaction between Parent and any of its Restricted Subsidiaries or between Restricted Subsidiaries; 

        (b)
the payment of reasonable and customary regular fees to directors of Parent or any of its Restricted Subsidiaries who are not its employees and Indemnification Arrangements entered
into by Parent or any of its Restricted Subsidiaries and approved by the Board of Directors of Parent; 

        (c)
any Restricted Payments not prohibited by Section 1012 and any Permitted Investment other than a Permitted Investment made pursuant to clause (ix) of the definition
thereof; 

        (d)
transactions provided for in the Employment Agreement as in effect on the Closing Date; 

        (e)
loans and advances to employees of Parent or any Restricted Subsidiary not exceeding at any one time outstanding $5.0 million in the aggregate, in the ordinary course of
business and in accordance with past practice; 

        (f)
any issuance of shares of Capital Stock (other than Redeemable Stock) of Parent and any options, warrants or other rights to acquire such Capital Stock; 

        (g)
any issuance or sale of shares of Capital Stock (other than Redeemable Stock) of a Designated Subsidiary and any options, warrants or other rights to acquire such Capital Stock, in
each case made in accordance with clause (iii) of Section 1014; 

        (h)
any employment arrangements entered into by Parent or any of its Restricted Subsidiaries in the ordinary course of business and approved by the Board of Directors of Parent; and 

        (i)
any tax-sharing agreement, and payments or other transactions pursuant thereto, between Parent and any other Person with which Parent files a consolidated tax return or
with 

65

 

which
Parent is part of a consolidated group for tax purposes, in each case approved by the Board of Directors of Parent. 

        SECTION
1016. Limitation on Liens. Under the terms of this Indenture, Parent will not, and will not permit any Restricted Subsidiary to, create, incur,
assume or suffer to exist any Lien (other than Permitted Liens) on any of its assets or properties of any character (including, without limitation, licenses and trademarks), or any shares of Capital
Stock or Indebtedness of any Restricted Subsidiary of Parent, without making effective provision for all of the Notes and Guarantees and all other amounts due under this Indenture to be directly
secured equally and ratably with (or prior to) the obligation or liability secured by such Lien. 

        SECTION
1017. Limitation on Asset Sales. Parent will not, and will not permit any of its Restricted Subsidiaries to, make any Asset Sale unless
(i) Parent or the Restricted Subsidiary, as the case may be, receives consideration at the time of such sale or other disposition at least equal to the Fair Market Value of the assets sold or
disposed of as determined by the good-faith judgment of the Board of Directors of Parent, which determination, in each case where such Fair Market Value is greater than
$10.0 million, will be evidenced by a Board Resolution and (ii) at least 75% of the consideration received for such sale or other disposition consists of cash or cash equivalents,
Marketable Securities or the assumption of unsubordinated Indebtedness. 

        Parent
shall, or shall cause the relevant Restricted Subsidiary to, within 360 days after the date of receipt of the Net Cash Proceeds from an Asset Sale, (i) (A) apply an
amount equal to such Net Cash Proceeds to permanently reduce, repay, redeem or repurchase unsubordinated Indebtedness of the Issuer or any Restricted Subsidiary of the Issuer that is not a Guarantor,
in each case owing to a Person other than Parent or any of its Restricted Subsidiaries; provided that if such unsubordinated Indebtedness (other than secured Indebtedness
under any Credit Facility) is pari passu with the Notes, then the Issuer will ratably reduce, repay, redeem or repurchase Indebtedness under the Notes,
or (B) invest an equal amount, or the amount not so applied pursuant to clause (A), in long-term property or assets of a nature or type or that are used in a business (or in
a company having property and assets of a nature or type, or engaged in a business) similar or related to
the nature or type of the property and assets of, or the business of, the Issuer and its Restricted Subsidiaries existing on the date of such investment (as determined in good faith by the Board of
Directors of Parent, whose determination shall be conclusive and evidenced by a Board Resolution) and (ii) apply (no later than the end of the 360-day period referred to above) such
excess Net Cash Proceeds (to the extent not applied pursuant to clause (i)) as provided in the following paragraphs of this Section 1017. The amount of such Net Cash Proceeds required to
be applied (or to be committed to be applied) during such 360-day period referred to above in the preceding sentence and not applied as so required by the end of such period shall
constitute "Excess Proceeds." 

        If,
as of the first day of any calendar month, the aggregate amount of Excess Proceeds not theretofore subject to an Excess Proceeds Offer (as defined below) totals at least
$15.0 million, the Issuer must, not later than the 45th Business Day thereafter, make an offer (an Excess Proceeds Offer) to purchase from the Holders on a pro rata basis an
aggregate principal amount of Notes equal to the Proportionate Share of the Excess Proceeds on such date, at a purchase price equal to 100% of the principal amount of the Notes, plus, in each case,
accrued and unpaid interest to the date of purchase (the "Excess Proceeds Payment"). 

        The
Issuer shall commence an Excess Proceeds Offer by mailing a notice to the Trustee and each Holder stating: 

        (i)
that the Excess Proceeds Offer is being made pursuant to this Section 1017 and that all Notes validly tendered will be accepted for payment on a pro rata basis; 

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        (ii)
the purchase price and the date of purchase (which shall be a Business Day no earlier than 30 days nor later than 60 days from the date such notice is mailed) (the
"Excess Proceeds Payment Date"); 

        (iii)
that any Note not tendered will continue to accrue interest pursuant to its terms; 

        (iv)
that, unless the Issuer defaults in the payment of the Excess Proceeds Payment, any Note accepted for payment pursuant to the Excess Proceeds Offer shall cease to accrue interest on
and after the Excess Proceeds Payment Date; 

        (v)
that Holders electing to have a Note purchased pursuant to the Excess Proceeds Offer will be required to surrender the Note, together with the form entitled "Option of the Holder to
Elect
Purchase" on the reverse side of the Note completed, to the Paying Agent at the address specified in the notice prior to the close of business on the Business Day immediately preceding the Excess
Proceeds Payment Date; 

        (vi)
that Holders will be entitled to withdraw their election if the Paying Agent receives, not later than the close of business on the third Business Day immediately preceding the
Excess Proceeds Payment Date, a telegram, facsimile transmission or letter setting forth the name of such Holder, the principal amount of Notes delivered for purchase and a statement that such Holder
is withdrawing his election to have such Notes purchased; and 

        (vii)
that Holders whose Notes are being purchased only in part will be issued new Notes equal in principal amount to the unpurchased portion of the Notes surrendered; provided that each
Note purchased and each new Note issued shall be in a principal amount of $1,000 or integral multiples thereof. 

        On
the Excess Proceeds Payment Date, the Issuer shall: 

        (i)
accept for payment on a pro rata basis Notes or portions thereof tendered pursuant to the Excess Proceeds Offer up to the Proportionate Share of such Excess Proceeds; 

        (ii)
deposit with the Paying Agent money sufficient to pay the purchase price of all Notes or portions thereof so accepted; and 

        (iii)
deliver, or cause to be delivered, to the Trustee all Notes or portions thereof so accepted together with an Officer's Certificate specifying the Notes or portions thereof accepted
for payment by the Issuer. 

        The
Paying Agent promptly shall mail to the Holders of Notes so accepted payment in an amount equal to the purchase price, and the Trustee shall upon Issuer Order promptly authenticate
and mail to such Holders a new Note equal in principal amount to any unpurchased portion of the Note surrendered; provided that each Note purchased and each new Note issued shall be in a principal
amount of $1,000 or integral multiples thereof. The Issuer will publicly announce the results of the Excess Proceeds Offer as soon as practicable after the Excess Proceeds Payment Date. For purposes
of this Section 1017, the Trustee shall act as the Paying Agent. 

        The
Issuer will comply with Rule 14e-1 under the Exchange Act and any other securities laws and regulations thereunder to the extent such laws and regulations are
applicable, in the event
that Issuer receives such Excess Proceeds under this Section 1017 and is required to repurchase Notes as described above. 

        SECTION
1018. Limitation on Issuances of Guarantees of Indebtedness by Restricted Subsidiaries. Parent will not permit any of its Restricted Subsidiaries
other than the Issuer, directly or indirectly, to guarantee, assume or in any other manner become liable with respect to any Indebtedness of Parent or the Issuer, other than Indebtedness under Credit
Facilities incurred under clauses (i) and (ii) of Section 1011, unless (i) such Restricted Subsidiary simultaneously executes and delivers a supplemental 

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indenture
to this Indenture providing for a Guarantee of the Notes on terms substantially similar to the guarantee of such Indebtedness, except that if such Indebtedness is by its express terms
subordinated in right of payment to the Notes, any such assumption, Guarantee or other liability of such Restricted Subsidiary with respect to such Indebtedness shall be subordinated in right of
payment to such Restricted Subsidiary's assumption, Guarantee or other liability with respect to the Notes substantially to the same extent as such Indebtedness is subordinated to the Notes and
(ii) such Restricted Subsidiary waives, and will not in any manner whatsoever claim or take the benefit or advantage of, any rights of reimbursement, indemnity or subrogation or any other
rights against the Obligors or any other Restricted Subsidiary as a result of any payment by such Restricted Subsidiary under its Guarantee. 

        Notwithstanding
the foregoing, any Guarantee by a Restricted Subsidiary may provide by its terms that it will be automatically and unconditionally released and discharged upon
(i) any sale, exchange or transfer, to any Person not an Affiliate of Parent, of all of Parent's and each Restricted Subsidiary's Capital Stock in, or all or substantially all of the assets of,
such Restricted Subsidiary (which sale, exchange or transfer is not prohibited by this Indenture), (ii) the designation of such Restricted Subsidiary as an Unrestricted Subsidiary in accordance
with this Indenture, or (iii) the release or discharge of the guarantee which resulted in the creation of such Guarantee, except a discharge or release by or as a result of payment under such
guarantee. 

        SECTION
1019. Business of Parent. Parent will not, and will not permit any Restricted Subsidiary to, be principally engaged in any business or activity other
than a Permitted Business. 

        SECTION
1020. Internal Reorganization. Parent will use, and will cause the Contingently Transferable Subsidiaries to use, their respective best efforts to
obtain all consents, approvals, authorizations or orders of, and to make all filings or registrations with, state regulatory commissions in the United States having regulatory jurisdiction over the
intrastate telecommunications services of the Contingently Transferable Subsidiaries and their subsidiaries necessary to effect the transfer to the Issuer by way of capital contribution of all rights,
title and interest in the Capital Stock of the Contingently Transferable Subsidiaries and to consummate the transfer by way of capital contribution of such rights, title and interest in the Capital
Stock of the Contingently Transferable Subsidiaries to the Issuer, without condition, as promptly as practicable after the date of this Indenture. 

        SECTION
1021. Intentionally omitted. 

        SECTION
1022. Waiver of Certain Covenants. An Obligor may omit in any particular instance to comply with any term, provision or condition set forth in
Section 803 or Sections 1007 through 1022, inclusive, if before or after the time for such compliance the Holders of at least a majority in principal amount of the Outstanding Notes, by Act of
such Holders, waive such compliance in such instance with such term, provision or condition, but no such waiver shall extend to or affect such term, provision or condition except to the extent so
expressly waived, and, until such waiver shall become effective, the obligations of each Obligor and the duties of the Trustee in respect of any such term, provision or condition shall remain in full
force and effect. 

 
 

ARTICLE ELEVEN    
    
    REDEMPTION OF NOTES    
    

        SECTION
1101. Right of Redemption. 

        (a)
The Notes may be redeemed, at the election of the Issuer, as a whole or from time to time in part, at any time on or after January 15, 2009, subject to the conditions and at
the Redemption Prices specified in the Notes, together with accrued interest to the Redemption Date. 

        (b)
Notwithstanding the foregoing, prior to January 15, 2007, the Issuer may redeem up to 35% of the originally issued aggregate principal amount of the Notes on one or more
occasions with the Net 

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Cash
Proceeds of one or more Equity Offerings, to the extent such Net Cash Proceeds have been contributed to the Issuer as common equity, at a redemption price equal to 108.000% of the aggregate
principal amount thereof, plus accrued interest, if any, and Additional Interest, if any, thereon to the Redemption Date; provided that, immediately after giving effect to such redemption, at least
65% of the originally issued aggregate principal amount of the Notes remains Outstanding; and provided further that notice of such redemptions shall be given within 60 days of the date of
closing of any such Equity Offering. 

        SECTION
1102. Applicability of Article. 

        Redemption
of Notes at the election of the Issuer or otherwise, as permitted or required by any provision of this Indenture, shall be made in accordance with such provision and this
Article. 

        SECTION
1103. Election to Redeem Notice to Trustee. 

        The
election of the Issuer to redeem any Notes pursuant to Section 1101 shall be evidenced by a Board Resolution. In case of any redemption at the election of the Issuer, the
Issuer shall, at least 60 days prior to the Redemption Date fixed by the Issuer (unless a shorter notice shall be satisfactory to the Trustee), notify the Trustee of such Redemption Date and of
the principal amount of Notes to be redeemed and shall deliver to the Trustee such documentation and records as shall enable the Trustee to select the Notes to be redeemed pursuant to
Section 1104. 

        SECTION
1104. Selection by Trustee of Notes to Be Redeemed. 

        If
less than all the Notes are to be redeemed, the particular Notes to be redeemed shall be selected not more than 60 days prior to the Redemption Date by the Trustee, from the
Outstanding Notes not previously called for redemption, in compliance with the requirements of the principal national securities exchange, if any, on which the Notes are listed, if the Notes are not
listed on a national securities exchange, on a pro rata basis, by lot or by such method as the Trustee shall deem fair and appropriate and which may provide for the selection for redemption of
portions of the principal of Notes; provided, however, that no such partial redemption shall reduce the portion of the principal amount of a
Note not redeemed to less than $1,000. 

        The
Trustee shall promptly notify the Issuer in writing of the Notes selected for redemption and, in the case of any Notes selected for partial redemption, the principal amount thereof
to be redeemed. 

        For
all purposes of this Indenture, unless the context otherwise requires, all provisions relating to redemption of Notes shall relate, in the case of any Note redeemed or to be redeemed
only in part, to the portion of the principal amount of such Note which has been or is to be redeemed. 

        SECTION
1105. Notice of Redemption. 

        Notice
of redemption shall be given in the manner provided for in Section 106 not less than 30 nor more than 60 days prior to the Redemption Date, to each Holder of Notes
to be redeemed. 

        All
notices of redemption shall state: 

        (1)
the Redemption Date, 

        (2)
the Redemption Price and the amount of accrued interest to the Redemption Date payable as provided in Section 1107, if any, 

        (3)
if less than all Outstanding Notes are to be redeemed, the identification (and, in the case of a partial redemption, the principal amounts) of the particular Notes to be redeemed, 

        (4)
in case any Note is to be redeemed in part only, the notice which relates to such Note shall state that on and after the Redemption Date, upon surrender of such Note, the Holder will
receive, without charge, a new Note or Notes of authorized denominations for the principal amount thereof remaining unredeemed, 

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        (5)
that on the Redemption Date the Redemption Price (and accrued interest and Additional Interest, if any, to the Redemption Date payable as provided in Section 1107) will become
due and payable upon each such Note, or the portion, thereof, to be redeemed, and that interest thereon will cease to accrue on and after said date, and 

        (6)
the place or places where such Notes are to be surrendered for payment of the Redemption Price and accrued interest and Additional Interest, if any. 

        Notice
of redemption of Notes to be redeemed at the election of the Issuer shall be given by the Issuer or, at the Issuer's request, Trustee in the name and at the expense of the Issuer. 

        SECTION
1106. Deposit of Redemption Price. 

        Prior
to any Redemption Date, the Issuer shall deposit with the Trustee or with a Paying Agent (or, if the Issuer is acting as its own Paying Agent, segregate and hold in trust as
provided in Section 1003) an amount of money sufficient to pay the Redemption Price of, and Additional Interest, if any, and accrued interest on, all the Notes which are to be redeemed on that
date. 

        SECTION
1107. Notes Payable on Redemption Date. 

        Notice
of redemption having been given as aforesaid, the Notes so to be redeemed shall, on the Redemption Date, become due and payable at the Redemption Price therein specified (together
with Additional Interest and accrued interest, if any, to the Redemption Date), and from and after such date (unless the Issuer shall default in the payment of the Redemption Price and accrued
interest) such Notes shall cease to bear interest. Upon surrender of any such Note for redemption in accordance with said notice, such Note shall be paid by the Issuer at the Redemption Price,
together with Additional Interest and accrued interest, if any, to the Redemption Date; provided, however, that installments of interest whose
Stated Maturity is on or prior to the Redemption Date shall be payable to the Holders of such Notes, or one or more Predecessor Notes, registered as such at the close of business on the relevant
Record Dates according to their terms and the provisions of Section 309. 

        If
any Note called for redemption shall not be so paid upon surrender thereof for redemption, the principal (and premium, if any) shall, until paid, bear interest from the Redemption
Date at the rate borne by the Notes. 

        SECTION
1108. Notes Redeemed in Part. 

        Any
Note which is to be redeemed only in part (pursuant to the provisions of this Article) shall be surrendered at the office or agency of the Issuer maintained for such purpose pursuant
to Section 1002 (with, if the Issuer or the Trustee so requires, due endorsement by, or a written instrument of transfer in form satisfactory to the Issuer and the Trustee duly executed by, the
Holder thereof or such Holder's attorney duly authorized in writing), and the Issuer shall execute, and the Trustee shall upon Issuer Order authenticate and deliver to the Holder of such Note without
service charge, a new Note or Notes, of any authorized denomination as requested by such Holder, in aggregate principal amount equal to and in exchange for the unredeemed portion of the principal of
the Note so surrendered. 

 
 

ARTICLE TWELVE    
    
    PARENT GUARANTEE    
    

        SECTION 1201. Guarantee. Parent hereby irrevocably and unconditionally guarantees, as primary obligor and not as surety, to each
Holder of the Notes and the Trustee the performance and punctual payment when due, whether at maturity, by acceleration, by redemption or otherwise, of all monetary obligations of the Issuer under
this Indenture and the Notes, whether for principal of, or interest or Additional Interest on, the Notes, indemnification or otherwise (including without limitation interest accruing after the filing
of any petition in bankruptcy, or the commencement of any insolvency, 

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reorganization
or like proceeding, relating to the Issuer or any Guarantor whether or not a claim for post-filing or post-petition interest is allowed in such proceeding) (all
the foregoing being hereinafter collectively called the "Guaranteed Obligations"). 

        Parent
waives presentation to, demand of payment from and protest to, the Issuer of any of the Guaranteed Obligations and also waives notice of protest for nonpayment. Parent waives
notice of any default under the Notes or the Guaranteed Obligations. The obligations of Parent hereunder shall not be affected by (a) the failure of any Holder to assert any claim or demand or
to enforce any right or remedy against the Issuer or any other Person under this Indenture, the Notes or any other agreement or otherwise; (b) any extension or renewal of any thereof;
(c) any rescission, waiver, amendment or modification of any of the terms or provisions of this Indenture, the Notes or any other agreement;
(d) the release of any security held by any Holder or the Trustee for the Guaranteed Obligations or any of them; or (e) any change in the ownership of the Issuer. 

        Parent
further agrees that the Parent Guarantee constitutes a Guarantee of payment when due (and not a Guarantee of collection) and waives any right to require that any resort be had by
any Holder to any security held for payment of the Guaranteed Obligations. 

        The
obligations of Parent hereunder shall not be subject to any reduction, limitation, impairment or termination for any reason (other than payment of the Guaranteed Obligations in
full), 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 Parent herein shall not be discharged
or impaired or otherwise affected by the failure of any Holder to assert any claim or demand or to enforce any remedy under this Indenture, the Notes or any other agreement, by any waiver or
modification of any thereof, by any default, failure or delay, willful 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 Parent or would otherwise operate as a discharge of Parent as a matter of law or equity. 

        Parent
agrees that the Parent Guarantee shall remain, in full force and effect until payment in full of all the Guaranteed Obligations. Parent further agrees that the Parent Guarantee
herein shall 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 on any of the Guaranteed Obligations is rescinded
or must otherwise be restored by any Holder upon the bankruptcy or reorganization of the Issuer or otherwise. 

        In
furtherance of the foregoing and not in limitation of any other right which any Holder has at law or in equity against Parent by virtue hereof, upon the failure of the Issuer to pay
any of the Guaranteed Obligations when and as the same shall become due, whether at maturity, by acceleration, by redemption or otherwise, Parent hereby promises to and will, upon receipt of written
demand by the Trustee, forthwith pay, or cause to be paid, in cash, to the Holders an amount equal to the sum of (i) the unpaid amount of such Guaranteed Obligations then due and owing and
(ii) accrued and unpaid interest on such Guaranteed Obligations then due and owing (but only to the extent not prohibited by law). 

        Parent
further agrees that, as between Parent, on the one hand, and the Holders, on the other hand, (x) the maturity of the Guaranteed Obligations guaranteed hereby may be
accelerated as provided in this Indenture for the purposes of the Parent Guarantee, notwithstanding any stay, injunction or other prohibition preventing such acceleration in respect of the Guaranteed
Obligations guaranteed hereby and (y) in the event of any such declaration of acceleration of such Guaranteed Obligations, such Guaranteed Obligations (whether or not due and payable) shall
forthwith become due and payable by Parent for the purposes of the Parent Guarantee. 

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        Parent
also agrees to pay any and all reasonable costs and expenses (including reasonable attorneys' fees) incurred by the Trustee or the Holders in enforcing any rights under this
Section or under the Interim Pledge Agreement and such costs and expenses shall constitute Guaranteed Obligations entitled to the rights and benefits of the Parent Guarantee. 

        SECTION
1202. Limitation on Liability; Termination, Release and Discharge. (a) Any term or provision of this Indenture to the contrary notwithstanding, the
maximum, aggregate amount of obligations of Parent hereunder will be limited to an amount as will, after giving effect to all other contingent and fixed liabilities of Parent, result in the
obligations of Parent under the Parent Guarantee not constituting a fraudulent conveyance or fraudulent transfer under federal or state law and not otherwise being void or voidable under any similar
laws affecting the rights of creditors generally. 

        (b)
Parent will be deemed released from all its obligations under this Indenture, and the Parent Guarantee and such Parent Guarantee will terminate upon (i) the legal defeasance
of the Notes pursuant to the provisions of Article Fourteen hereof or (ii) the satisfaction and discharge of the Indenture pursuant to the provisions of Article Four hereof. 

        SECTION
1203. No Subrogation. Notwithstanding any payment or payments made by Parent hereunder, Parent shall not be entitled to be subrogated to any of the
rights of the Trustee or any Holder against the Issuer or any other Guarantor or any collateral security or guarantee or right of offset held by the Trustee or any Holder for the payment of the
Guaranteed Obligations, nor shall Parent seek or be entitled to seek any contribution or reimbursement from the Issuer or any other Guarantor in respect of payments made by Parent hereunder, until all
amounts owing to the Trustee and the Holders by the Issuer on account of the Guaranteed Obligations are paid in full. If any amount shall be paid to Parent on account of such subrogation rights at any
time when all of the Guaranteed Obligations shall not have been paid in full, such amount shall be held by Parent in trust for the Trustee and the Holders, segregated from other funds of Parent, and
shall, forthwith upon receipt by Parent, be turned over to the Trustee in the exact form received by Parent (duly indorsed by Parent to the Trustee, if required), to be applied against the Guaranteed
Obligations. 

 
 

ARTICLE THIRTEEN    
    
    COLLATERAL    
    

        SECTION 1301. Interim Pledge Agreement. The Parent Guarantee shall be secured as provided in the Interim Pledge Agreement. The
Trustee and Parent hereby agree that the Collateral Agent shall hold the Collateral in trust for the benefit of all of the Holders and other secured parties under the Interim Pledge Agreement, in each
case pursuant to the terms of the Interim Pledge Agreement. 

        Each
Holder of the Notes, by its acceptance thereof, consents and agrees to the terms of the Interim Pledge Agreement (including, without limitation, the provisions providing for
foreclosure and release of Collateral) as the same may be in effect or may be amended from time to time in accordance with their terms and authorizes and directs (i) the Collateral Agent, with
respect to the Interim Pledge Agreement, and (ii) the Trustee to perform their respective obligations and exercise their respective rights thereunder in accordance therewith. 

        The
Trustee and each Holder, by accepting the Notes, acknowledges that, as more fully set forth in the Interim Pledge Agreement, the Collateral as now or hereafter constituted shall be
held for the benefit of all the Holders and other secured parties under the Interim Pledge Agreement, and that the Lien of this Indenture and the Interim Pledge Agreement in respect of the Collateral
Agent and the Holders is subject to and qualified and limited in all respects by the Interim Pledge Agreement and actions that may be taken thereunder. 

        Notwithstanding
(i) anything to the contrary contained in this Indenture, the Interim Pledge Agreement, Notes or any other instrument governing, evidencing or relating to any
Indebtedness, 

72

 

(ii) the
time, order or method of attachment of any Liens, (iii) the time or order of filing or recording of financing statements or other documents filed or recorded to perfect any Lien
upon any Collateral, (iv) the time of taking possession or control over any Collateral or (v) the rules for determining priority under the Uniform Commercial Code or any other law
governing relative priorities of secured creditors: 

        (A)
the Liens will rank equally and ratably with all valid, enforceable and perfected Liens, whenever granted upon any present or future Collateral, but only to the extent such Liens are
permitted under this Indenture to exist and to rank equally and ratably with the Notes; and 

        (B)
]all proceeds of the Interim Pledge Agreement shall be allocated and distributed as set forth in the Interim Pledge Agreement. 

        SECTION
1302. Opinions. Promptly after the effectiveness of this Indenture, to the extent required by the TIA, Parent shall deliver the opinion(s) required
by Section 314(b)(1) of the TIA. Subsequent to the execution and delivery of this Indenture, to the extent required by the TIA, Parent shall furnish to the Trustee on or prior to each
anniversary of the Issuance Date of the Original Notes, an Opinion of Counsel of Parent, dated as of such date, stating either that (i) in the opinion of such counsel, all action has been taken
with respect to any filing, re-filing, recording or re-recording with respect to the Collateral as is necessary to maintain the Lien on the Collateral in favor of the Holders
or (ii) in the opinion of such counsel, that no such action is necessary to maintain such Lien. 

        SECTION
1303. Release of the Collateral. 

        (a)   The
parties hereto hereby agree and acknowledge that the Collateral may be released by the Collateral Agent at any time in accordance with the provisions of the Interim
Pledge Agreement and this Indenture or upon the termination of this Indenture and, in any such case, the Collateral so released shall automatically be released as Collateral for the Notes without any
action on the part of the Trustee or the Holders. For purposes of the TIA, the release of any Collateral from the terms of the Interim Pledge Agreement will not be deemed to impair the security under
this Indenture in contravention of the provisions hereof or affect the Lien of this Indenture or the Interim Pledge Agreement if and to the extent the Collateral is released pursuant to the Interim
Pledge Agreement or upon the termination of this Indenture. To the extent applicable, Parent shall comply with Section 314(d) of the TIA relating to the release of property or securities from
the Lien of the Interim Pledge Agreement and relating to the substitution therefor of any property or securities to be subjected to such Lien. 

        (b)   The
fair value of Collateral released from the Liens of the Interim Pledge Agreement pursuant to Section 1303(a) hereof shall not be considered in determining
whether the aggregate fair value of Collateral released from the Liens of the Interim Pledge Agreement in any calendar year exceeds the 10% threshold specified in Section 314(d)(l) of the TIA.
It is expressly understood that Section 1303(a) and this Section 1303(b) relate only to Parent's obligations under the TIA and shall not restrict or otherwise affect Parent's rights or
abilities to obtain releases of the Collateral pursuant to the terms of this Indenture and the Interim Pledge Agreement or as otherwise permitted by the Trustee under this Indenture. 

        SECTION
1304. Certificates of Parent. Subject to Section 1303(b) Parent shall furnish to the Trustee prior to each proposed release of Collateral all
documents required by Section 314(d) of the TIA, if any. Any certificate or opinion required by Section 314(d) of the TIA, if applicable, may be made by an officer of Parent except in
cases where Section 314(d) of the TIA requires that such certificate or opinion be made by an independent engineer, appraiser or other expert within the meaning Section 314(d) of the
TIA. 

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        SECTION
1305. Authorization of Actions to be Taken by the Trustee Under the Interim Pledge Agreement. 

        (a)   The
Trustee shall be the representative on behalf of the Holders and shall act upon the written direction of the Holders with regard to all voting, consent and other
rights granted to the Holders under the Interim Pledge Agreement. Subject to the provisions of the Interim Pledge Agreement, the Trustee may, in its sole discretion and without the consent of the
Holders, on behalf of the Holders, take all actions it deems necessary or appropriate in order to (a) enforce any of its rights or any of the rights of the Holders under the Interim Pledge
Agreement and (b) receive any and all amounts payable from the Collateral in respect of the obligations of Parent hereunder. Subject to the provisions of the Interim Pledge Agreement, the
Trustee shall have the power to institute and to 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 Interim Pledge Agreement or this Indenture, and such suits and proceedings as the Trustee may deem expedient to preserve or protect its interest 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 the Trustee). 

        (b)   The
Trustee shall not be responsible for the existence, genuineness or value of any of the Collateral or for the validity, perfection, priority or enforceability of the
Liens in any of the Collateral, whether impaired by operation of law or by reason of any action or omission to act on the part of the Trustee hereunder, except to the extent such action or omission
constitutes negligence, bad faith or willful misconduct on the part of the Trustee, for the validity or sufficiency of the Collateral or any agreement or assignment contained therein, for the validity
of the title of Parent to the Collateral, for insuring the Collateral or for the payment of taxes, charges, assessments or Liens upon the Collateral or otherwise as to the maintenance of the
Collateral. 

        SECTON
1306. Authorization of Receipt of Funds by the Trustee Under the Interim Pledge Agreement. The Trustee is authorized to receive any funds for the
benefit of the Holders distributed by the Collateral Agent under the Interim Pledge Agreement, and to make further distributions of such funds to the Holders according to the provisions of this
Indenture and the Interim Pledge Agreement. 

        SECTION
1307. Release Upon Termination of Guaranteed Obligations. 

        (a)   If
(i) Parent delivers an Officer's Certificate and an Opinion of Counsel certifying that all of its obligations under this Indenture have been satisfied and
discharged by complying with the provisions of Article Four hereof, (ii) all outstanding Notes issued under this Indenture shall be surrendered to the Trustee for cancellation, (iii) the
release of the Collateral in accordance with the terms of the Interim Pledge Agreement occurs or (iv) any other release of the Collateral as security for obligations of Parent under this
Indenture occurs, the Trustee shall deliver to the Collateral Agent a notice stating that the Trustee, for itself and on behalf of the Holders, disclaims and has given up any and all rights it has in
or to the Collateral, and any rights it has under the Interim Pledge Agreement, and, upon and after the receipt by the Collateral Agent of such notice, the Collateral Agent shall no longer be deemed
to hold the Lien in the Collateral on behalf of the Trustee for the benefit of the Holders. 

        Any
release of Collateral made in compliance with this Section 1307 shall not be deemed to impair the Lien under the Interim Pledge Agreement or the Collateral thereunder in
contravention of the provisions of this Indenture or the Interim Pledge Agreement. 

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ARTICLE FOURTEEN    
    
    DEFEASANCE AND COVENANT DEFEASANCE    
    

        SECTION 1401. Issuer's Option to Effect Defeasance or Covenant Defeasance. 

        The
Issuer may, at its option by Board Resolution, at any time, with respect to the Notes, elect to have either Section 1402 or Section 1403 be applied to all Outstanding
Notes upon compliance with the conditions set forth below in this Article Fourteen. 

        SECTION
1402. Defeasance and Discharge. 

        Upon
the Issuer's exercise under Section 1401 of the option applicable to this Section 1402, the Issuer shall be deemed to have been discharged from its obligations with
respect to all Outstanding Notes on
the date the conditions set forth in Section 1404 are satisfied (hereinafter, "defeasance"). For this purpose, such defeasance means that the Issuer shall be deemed to have paid and discharged
the entire indebtedness represented by the Outstanding Notes, which shall thereafter be deemed to be "Outstanding" only for the purposes of Section 1405 and the other Sections of this Indenture
referred to in (A) and (B) below, and to have satisfied all its other obligations under such Notes and this Indenture insofar as such Notes are concerned (and the Trustee, at the expense
of the Issuer, shall execute proper instruments acknowledging the same), except for the following which shall survive until otherwise terminated or discharged hereunder: (A) the rights of
Holders of Outstanding Notes to receive, solely from the trust fund described in Section 1404 and as more fully set forth in such Section, payments in respect of the principal of (and premium,
if any, on) and interest and Additional Interest, if any, on such Notes when such payments are due, (B) the Issuer's obligations with respect to such Notes under Sections 304, 305, 308, 1002
and 1003, (C) the rights, powers, trusts, duties and immunities of the Trustee hereunder and (D) this Article Fourteen. Subject to compliance with this Article Fourteen, the Issuer may
exercise its option under this Section 1402 notwithstanding the prior exercise of its option under Section 1403 with respect to the Notes. 

        SECTION
1403. Covenant Defeasance. 

        Upon
the Issuer's exercise under Section 1401 of the option applicable to this Section 1403, Parent and the Issuer shall be released from their respective obligations under
any covenant contained in Section 801(3) and Section 803 and in Sections 1007 through 1020 with respect to the Outstanding Notes on and after the date the conditions set forth below are
satisfied (hereinafter, "covenant defeasance"), and the Notes shall thereafter be deemed not to be "Outstanding" for the purposes of any direction, waiver, consent or declaration or Act of Holders
(and the consequences of any thereof) in connection with such covenants, but shall continue to be deemed "Outstanding" for all other purposes hereunder. For this purpose, such covenant defeasance
means that, with respect to the Outstanding Notes, Parent and the Issuer may omit to comply with and shall have no liability in respect of any term, condition or limitation set forth in any such
covenant, whether directly or indirectly, by reason of any reference elsewhere herein to any such covenant or by reason of any reference in any such covenant to any other provision herein or in any
other document and such omission to comply shall not constitute a Default or an Event of Default under Section 501(5), but, except as specified above, the remainder of this Indenture and such
Notes shall be unaffected thereby. 

        SECTION
1404. Conditions to Defeasance or Covenant Defeasance. 

        The
following shall be the conditions to application of either Section 1402 or Section 1403 to the Outstanding Notes: 

        (1)   The
Issuer shall irrevocably have deposited or caused to be deposited with the Trustee (or another trustee satisfying the requirements of Section 607 who shall
agree to comply with the provisions of this Article Fourteen applicable to it) as trust funds in trust for the purpose of making the following payments, specifically pledged as security for, and
dedicated solely to, the 

75

 

benefit
of the Holders of such Notes, (A) cash in United States dollars, or (B) U.S. Government Obligations which through the scheduled payment of principal and interest in respect
thereof in accordance with their terms will provide, not later than one day before the due date of any payment, money in an amount, or (C) a combination thereof, sufficient, in the opinion of a
nationally recognized firm of independent public accountants expressed in a written certification thereof delivered to the Trustee, to pay and discharge, and which shall be applied by the Trustee (or
other qualifying trustee) to pay and discharge, (i) the principal of (and premium, if any), interest and Additional Interest, if any, on the Outstanding Notes on the Stated Maturity (or
Redemption Date, if applicable) of such principal (and premium, if any) or installment of interest and Additional Interest, if any, and (ii) any mandatory sinking fund payments or analogous
payments applicable to the Outstanding Notes on the day on which such payments are due and payable in accordance with the terms of this Indenture and of such Notes;
provided that the Trustee shall have been irrevocably instructed to apply such money or the proceeds of such U.S. Government Obligations to said payments with respect to
the Notes. Before such a deposit, the Issuer may give to the Trustee, in accordance with Section 1103 hereof, a notice of its election to redeem all of the Outstanding Notes at a future date in
accordance with Article Eleven hereof, which notice shall be irrevocable. Such irrevocable redemption notice, if given, shall be given effect in applying the foregoing. For this purpose, "U.S.
Government Obligations" means securities that are (x) direct obligations of the United States of America for the timely payment of which its full faith and credit is pledged or
(y) obligations of a Person controlled or supervised by and acting as an agency or instrumentality of the United States of America the timely payment of which is unconditionally guaranteed as a
full faith and credit obligation by the United States of America, which, in either case, are not callable or redeemable at the option of the issuer thereof, and shall also include a depository receipt
issued by a bank (as defined in Section 3(a)(2) of the Securities Act, as custodian with respect to any such U.S. Government Obligation or a specific payment of principal of or interest on any
such U.S. Government Obligation held by such custodian for the account of the holder of such depository receipt, provided that (except as required by law) such custodian
is not authorized to make any deduction from the amount payable to the holder of such depository receipt from any amount received by the custodian in respect of the U.S. Government Obligation or the
specific payment of principal of or interest on the U.S. Government Obligation evidenced by such depository receipt. 

        (2)   No
Default or Event of Default with respect to the Notes shall have occurred and be continuing on the date of such deposit or, insofar as paragraphs (8) and
(9) of Section 501 hereof are concerned, at any time during the period ending on the 123rd day after the date of such deposit (it being understood that this condition shall not be deemed
satisfied until the expiration of such period). 

        (3)   [Intentionally
Omitted] 

        (4)   Such
defeasance or covenant defeasance shall not result in a breach or violation of, or constitute a default under any material agreement or instrument (other than this
Indenture) to which the Issuer is a party or by which it is bound. 

        (5)   In
the case of an election under Section 1402, the Issuer shall have delivered to the Trustee an Opinion of Counsel stating that (x) the Issuer has
received from, or there has been published by, the Internal Revenue Service a ruling, or (y) since January 16, 2004, there has been a change in the applicable federal income tax law, in
either case to the effect that, and based thereon such opinion shall confirm that, the Holders of the Outstanding Notes will not recognize income, gain or loss for federal income tax purposes as a
result of such 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 defeasance had not occurred. 

76

 

        (6)   In
the case of an election under Section 1403, the Issuer shall have delivered to the Trustee an Opinion of Counsel to the effect that the Holders of the
Outstanding Notes will not recognize income, gain or loss for federal income tax purposes as a result of such 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 covenant defeasance had not occurred. 

        (7)   The
Issuer shall have delivered to the Trustee an Officer's Certificate and an Opinion of Counsel, each stating that all conditions precedent provided for relating to
either the defeasance under Section 1402 or the covenant defeasance under Section 1403 (as the case may be) have been complied with. 

        SECTION
1405. Deposited Money and U.S. Government Obligations to Be Held in Trust; Other Miscellaneous Provisions. 

        Subject
to the provisions of the last paragraph of Section 1003, all money and U.S. Government Obligations (including the proceeds thereof) deposited with the Trustee (or other
qualifying trustee, collectively for purposes of this Section 1405, the "Trustee") pursuant to Section 1404 in respect of the Outstanding Notes shall be held in trust and applied by the
Trustee, in accordance with the provisions of such Notes and this Indenture, to the payment, either directly or through any Paying Agent (including the Issuer acting as its own Paying Agent) as the
Trustee may determine, to the Holders of such Notes of all sums due and to become due thereon in respect of principal (and premium and Additional Interest, if any) and interest, but such money need
not be segregated from other funds except to the extent required by law. 

        The
Issuer shall pay and indemnify the Trustee against any tax, fee or other charge imposed on or assessed against the U.S. Governmental Obligations deposited pursuant to
Section 1404 or the principal and interest received in respect thereof other than any such tax, fee or other charge which by law is for the account of the Holders of the Outstanding Notes. 

        Anything
in this Article Fourteen to the contrary notwithstanding, the Trustee shall deliver or pay to the Issuer from time to time upon Issuer Request any money or U.S. Government
Obligations held by it as provided in Section 1404 which, in the opinion of a nationally recognized firm of independent public accountants expressed in a written certification thereof delivered
to the Trustee, are in excess of the amount thereof which would then be required to be deposited to effect an equivalent defeasance or covenant defeasance, as applicable, in accordance with this
Article. 

        SECTION
1406. Reinstatement. 

        If
the Trustee or any Paying Agent is unable to apply any money in accordance with Section 1405 by reason of any order or judgment of any court or governmental authority
enjoining, restraining or otherwise prohibiting such application, then the Issuer's obligations under this Indenture and the Notes shall be revived and reinstated as though no deposit had occurred
pursuant to Section 1402 or 1403, as the case may be, until such time as the Trustee or Paying Agent is permitted to apply all such money in accordance with Section 1405;
provided, however, that if the Issuer makes any payment of principal of (or premium or Additional Interest, if any) or interest on any Note
following the reinstatement of its obligations, the Issuer shall be subrogated to the rights of the Holders of such Notes to receive such payment from the money held by the Trustee or Paying Agent. 

77

        This Indenture may be signed in any number of counterparts each of which so executed shall be deemed to be an original, but all such counterparts shall together constitute but one and
the same Indenture. 

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

	 	 	PRIMUS TELECOMMUNICATIONS HOLDING, INC.
	

 	
 	

By:	
 	

	 	 	 	 	Name: K. Paul Singh
	 	 	 	 	Title: President
	

 	
 	

PRIMUS TELECOMMUNICATIONS GROUP, INCORPORATED
	

 	
 	

By:	
 	

	 	 	 	 	Name: K. Paul Singh
	 	 	 	 	Title: President and Chief Executive Officer

	Attest:	 	 
	

By:	
 	

	
 	

 
	 	 	Name:	 	 
	 	 	Title:	 	 

	 	 	WACHOVIA BANK, NATIONAL ASSOCIATION
	

 	
 	

By:	
 	

	 	 	 	 	Name:
	 	 	 	 	Title:

	Attest:	 	 
	

By:	
 	

	
 	

 
	 	 	Name:	 	 
	 	 	Title:	 	 

  

 
 

EXHIBIT A    
    
    [FORM OF FACE OF NOTE]    
    
    PRIMUS TELECOMMUNICATIONS HOLDING, INC.    
    
    8% [Series B]1 Senior Note Due 2014    

[CUSIP] [CINS]                          

	 
	 	 

	No.	 	$	                  

        Primus
Telecommunications Holding, Inc., a Delaware corporation (herein called the "Issuer," which term includes any successor Person under the Indenture hereinafter referred to),
for value received, hereby promises to pay to                        or registered assigns, the principal sum
of                        United States dollars
on                        , at the
office or agency of the Issuer referred to below, and to pay interest thereon on                        and semi-annually
thereafter,
on                        and                 
       in each year, from
                            ,            or from
the most recent Interest Payment Date to which interest has been paid or duly provided for, at the rate of 8% per annum, until the principal
hereof is paid or duly provided for, and (to the extent lawful) to pay on demand interest on any overdue interest at the rate borne by the Notes from the date on which such overdue interest becomes
payable to the date payment of such interest has been made or duly provided for. The interest so payable, and punctually paid or duly provided for, on any Interest Payment Date will, as provided in
such Indenture, be paid to the Person in whose name this Note (or one or more Predecessor Notes) is registered at the close of business on the Regular Record Date for such interest, which shall be the
                        or                 
       (whether or not a Business Day), as the case may be, next preceding such Interest Payment Date. Any such interest not so punctually paid or duly provided for shall
forthwith cease to be payable to the Holder on such Regular Record Date, and such defaulted interest, and (to the extent lawful) interest on such defaulted interest at the rate borne by the Notes, may
be paid to the Person in whose name this Note (or one or more Predecessor Notes) is registered at the close of business on a Special Record Date for the payment of such Defaulted Interest to be fixed
by the Trustee, notice whereof shall be given to Holders of Notes not less than 10 days prior to such Special Record Date, or may be paid at any time in any other lawful manner not inconsistent
with the requirements of any securities exchange on which the Notes may be listed, and upon such notice as may be required by such exchange, all as more fully provided in said Indenture. 

	1
	Include
only for Exchange Notes. 

A-1

 

        [The
Holder of this Note is entitled to the benefits of the Registration Rights Agreement, dated as of January 16, 2004 (the "Registration Rights Agreement"), between
the Issuer, Primus Telecommunications Group, Incorporated and the Initial Purchasers named therein. In the event that either (i) any of the Registration Statements required by the Registration
Rights Agreement is not declared effective by the Commission on or prior to the date specified for such effectiveness in the Registration Rights Agreement (the "Effectiveness Target Date"),
(ii) the Exchange Offer has not been consummated on or prior to the date specified for such consummation in the Registration Rights Agreement or (iii) any Registration Statement required
by the Registration Rights Agreement is filed and declared effective but thereafter ceases to be effective or fails to be usable for its intended purpose (in the case of the Exchange Offer
Registration Statement referred to in the Registration Rights Agreement, at any time after the Effectiveness Target Date and, in the case of a Shelf Registration Statement referred to in the
Registration Rights Agreement, at any time but subject to certain permitted suspensions as more fully described in the Registration Rights Agreement) without being succeeded within five Business Days
by a post-effective amendment to such Registration Statement that cures such failure and that is declared effective within such five Business Day period (each such event referred to in
clauses (i) through (iii) above, a "Registration Default"), additional cash interest ("Additional Interest") shall accrue to each Holder of the Notes commencing upon the
occurrence of such Registration Default in an amount equal to .25% per annum of the principal amount of Notes held by such Holder. The amount of Additional Interest will increase by an additional .25%
per annum of the principal amount of Notes with respect to each subsequent 90-day period (or portion thereof) until all Registration Defaults have been cured, up to a maximum rate of
Additional Interest of 1.00% per annum of the principal amount of Notes. All accrued Additional Interest will be paid to Holders by the Issuer in the same manner as interest is paid pursuant to the
Indenture. Following the cure of all Registration Defaults relating to any particular Transfer Restricted Securities (as defined in the Registration Rights Agreement), the accrual of Additional
Interest with respect to such Transfer Restricted Securities will cease.]2 

        If
a Holder has given wire instructions to the Issuer, the Issuer will pay all principal of (and premium and Additional Interest, if any) and interest on such Holder's Notes in
accordance with those instructions. Otherwise, payment of the principal of (and premium and Additional Interest, if any) and interest on this Note will be made at the office or agency of the Issuer
maintained for that purpose in The City of New York, or at such other office or agency of the Issuer as may be maintained for such purpose, in such coin or currency of the United States of America as
at the time of payment is legal tender for payment of public and private debts; provided, however, that payment of interest may be made at the
option of the Issuer (i) by check mailed to the address of the Person entitled thereto as such address shall appear on the Note Register or (ii) by transfer to an account maintained by
the payee located in the United States. 

        Reference
is hereby made to the further provisions of this Note set forth on the reverse hereof, which further provisions shall for all purposes have the same effect as if set forth at
this place. 

        Unless
the certificate of authentication hereon has been duly executed by the Trustee referred to on the reverse hereof by manual signature, this Note shall not be entitled to any
benefit under the Indenture, or be valid or obligatory for any purpose. 

	2
	To
be included in Initial Notes and modified, as appropriate, for the Additional Notes. 

A-2

 

        IN
WITNESS WHEREOF, the Issuer has caused this instrument to be duly executed under its corporate seal. 

	 
	 
	 	 

	Dated:	 	 	 
	 	PRIMUS TELECOMMUNICATIONS HOLDING, INC.
	

 	

By	
 	

 
	 	 	 	

	 	 	 	Name:
	 	 	 	Title:
	

Attest:	

 	
 	

 
	

	

 	
 	

 
	Authorized Signature	 	 	 
	

TRUSTEE'S CERTIFICATE OF AUTHENTICATION.
	

Dated:	

 	
 	

 
	

This is one of the Notes referred to in the within-mentioned Indenture.
	

 	

WACHOVIA BANK, NATIONAL

ASSOCIATION, as Trustee
	

 	

By	
 	

 
	 	 	 	

	 	 	 	Authorized Officer

A-3

   
[FORM OF REVERSE SIDE OF NOTE] 

PRIMUS
TELECOMMUNICATIONS HOLDING, INC. 

8%
[Series B]3 Senior Notes Due 2014 

        This
Note is one of a duly authorized issue of notes of the Issuer designated as its 8% Senior Notes Due 2014 (herein called the "Notes"), which may be issued under an indenture (herein
called the "Indenture") dated as of January 16, 2004 between the Issuer, Primus Telecommunications Group, Incorporated ("Parent") and Wachovia Bank, National Association, trustee (herein called
the "Trustee", which term includes any successor trustee under the Indenture), to which Indenture and all indentures supplemental thereto reference is hereby made for a statement of the respective
rights, limitations of rights, duties, obligations and immunities thereunder of the Issuer, Parent, the Trustee and the Holders of the Notes, and of the terms upon which the Notes are, and are to be,
authenticated and delivered. 

        The
performance and punctual payment when due, whether at maturity, by acceleration, by redemption or otherwise, of all monetary obligations of the Issuer under this Indenture and the
Notes, whether for principal of, or interest or Additional Interest on, the Notes, indemnification or otherwise, are unconditionally guaranteed by Parent as set forth in the Indenture. 

        The
Notes are subject to redemption upon not less than 30 nor more than 60 days prior notice, in whole or in part, at any time or from time to time on or after January 15,
2009 and prior to Maturity, at the election of the Issuer, at Redemption Prices (expressed in percentages of principal amount thereof), plus accrued and unpaid interest and Additional Interest, if
any, thereon to the Redemption Date (subject to the right of Holders of record on the relevant Record Date to receive interest due on an Interest Payment Date that is on or prior to the Redemption
Date), if redeemed during the 12-month period beginning January 15 of the years indicated: 

	 
	 	Redemption

	2009	 	104.000%
	2010	 	102.667%
	2011	 	101.333%
	2012 (and thereafter)	 	100.000%

        Notwithstanding
the foregoing, prior to January 15, 2007, the Issuer may on any one or more occasions redeem up to 35% of the originally issued principal amount of Notes at a
redemption price of 108.000% of the principal amount thereof, plus accrued and unpaid interest and Additional Interest, if any, thereon to the redemption date, with the Net Cash Proceeds of one or
more Equity Offerings to the extent such Net Cash Proceeds have been contributed to the Issuer as common equity; provided (i) that at least 65% of the originally
issued principal amount of Notes remains outstanding immediately after giving effect to such redemption and (ii) that notice of such redemption is mailed within 60 days of the closing of
each such Equity Offering. 

        Upon
the occurrence of a Change of Control, the Holder of this Note may require the Issuer, subject to certain limitations provided in the Indenture, to repurchase all or any part of
this Note at a purchase price in cash in an amount equal to 101% of the principal amount thereof plus accrued and unpaid interest and Additional Interest, if any, to the date of purchase. 

	3
	Include
only for Exchange Notes. 

A-4

 

        Under
certain circumstances, in the event the Net Cash Proceeds received by the Issuer from an Asset Sale, which proceeds are not used to (i) (A) apply an amount equal to such Net
Cash Proceeds to permanently reduce, repay, redeem or repurchase unsubordinated Indebtedness of the Issuer or any Restricted Subsidiary of the Issuer that is not a Guarantor, in each case owing to a
Person other than Parent or any of its Restricted Subsidiaries; provided that if such unsubordinated Indebtedness (other than secured Indebtedness under any Credit
Facility) is pari passu with the Notes, then the Issuer will ratably reduce, repay, redeem or repurchase Indebtedness under the Notes, or
(B) invest an equal amount, or the amount not so applied pursuant to clause (A), in long-term property or assets of a nature or type or that are used in a business (or in a
company having property and assets of a nature or type, or engaged in a business) similar or related to the nature or type of the property and assets of, or the business of, the Issuer and its
Restricted Subsidiaries existing on the date of such investment (as determined in good faith by the Board of Directors of Parent, whose determination shall be conclusive and evidenced by a Board
Resolution) and (ii) apply (no later than the end of the 360-day period immediately following the date of receipt of the Net Cash Proceeds from an Asset Sale) such excess Net Cash
Proceeds (to the extent not applied pursuant to clause (i)) in accordance with the Indenture, the Issuer shall be required to make an offer to all Holders to purchase the maximum principal
amount of Notes, in an integral multiple of $1,000, that may be purchased out of such amount at a purchase price in cash equal to 100% of the principal amount thereof, plus accrued, unpaid interest
and Additional Interest, if any, to the date of purchase, in accordance with the Indenture. Holders of Notes that are subject to any offer to purchase shall receive an Excess Proceeds Offer from the
Issuer prior to any related Excess Proceeds Payment Date. 

        In
the case of any redemption or repurchase of Notes, interest installments and Additional Interest, if any, whose Stated Maturity is on or prior to the Redemption Date or Excess
Proceeds Payment Date will be payable to the Holders of such Notes, or one or more Predecessor Notes, of record at the close of business on the relevant Record Date referred to on the face hereof.
Notes (or portions thereof) for whose redemption and payment provision is made in accordance with the Indenture shall cease to bear interest from and after the Redemption Date or Excess Proceeds
Payment Date, as the case may be. 

        In
the event of redemption of this Note in part only, a new Note or Notes for the unredeemed portion hereof shall be issued in the name of the Holder hereof upon the cancellation hereof. 

        If
an Event of Default shall occur and be continuing, the principal of all the Notes may be declared due and payable in the manner and with the effect provided in the Indenture. 

        The
Indenture contains provisions for defeasance at any time of (a) the entire indebtedness of the Issuer on this Note and (b) certain restrictive covenants and the related
Defaults and Events of Default, upon compliance by the Issuer with certain conditions set forth therein, which provisions apply to this Note. 

        The
Indenture permits, with certain exceptions as therein provided the amendment thereof and the modification of the rights and obligations of the Issuer and the rights of the Holders
under the Indenture at any time by the Issuer and the Trustee with the consent of the Holders of a majority in aggregate principal amount of the Notes at the time Outstanding. The Indenture also
contains provisions permitting the Holders of specified percentages in aggregate principal amount of the Notes at the time Outstanding, on behalf of the Holders of all the Notes, to waive compliance
by the Issuer with certain provisions of the Indenture and certain past defaults under the Indenture and their consequences. Any such consent or waiver by or on behalf of the Holder of this Note shall
be conclusive and binding upon such Holder and upon all future Holders of this Note and of any Note issued upon the registration of transfer hereof or in exchange herewith or in lieu hereof whether or
not notation of such consent or waiver is made upon this Note. 

A-5

 

        No
reference herein to the Indenture and no provision of this Note or of the Indenture shall alter or impair the obligation of the Issuer, which is absolute and unconditional, to pay the
principal of (and premium, if any) and interest and Additional Interest, if any, on this Note at the times, place, and rate, and in the coin or currency, herein prescribed. 

        If
less than all the Notes are to be redeemed, the particular Notes to be redeemed shall be selected not more than 60 days prior to the Redemption Date in compliance with the
requirements of the principal national securities exchange, if any, on which the Notes are listed or, if the Notes are not listed on a national securities exchange, on a pro rata basis, by lot or by
such other method as the Trustee in its sole discretion shall deem fair and appropriate and which may provide for the selection for redemption of portions of the principal of Notes. 

        As
provided in the Indenture and subject to certain limitations therein set forth, the transfer of this Note is registrable on the Note Register of the Issuer, upon surrender of this
Note for registration of transfer at the office or agency of the Issuer maintained for such purpose in The City of New York, duly endorsed by, or accompanied by a written instrument of transfer in
form satisfactory to the Issuer and the Note Registrar duly executed by, the Holder hereof or his attorney duly authorized in writing, and thereupon one or more new Notes, of authorized denominations
and for the same aggregate principal amount, will be issued to the designated transferee or transferees. 

        The
Notes are issuable only in registered form without coupons in denominations of $1,000 and any integral multiple thereof. As provided in the Indenture and subject to certain
limitations therein set forth, the Notes are exchangeable for a like aggregate principal amount of Notes of a different authorized denomination, as requested by the Holder surrendering the same. 

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

        Prior
to the time of due presentment of this Note for registration of transfer, the Issuer, the Trustee and any agent of the Issuer or the Trustee may treat the Person in whose name this
Note is registered on the Note Register as the owner hereof for all purposes, whether or not this Note be overdue, and neither the Issuer, the Trustee nor any agent shall be affected by notice to the
contrary. 

        THIS
NOTE SHALL BE GOVERNED AND CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK. 

        Interest
on this Note shall be computed on the basis of a 360-day year of twelve 30-day months. 

        All
terms used in this Note which are defined in the Indenture and not otherwise defined herein shall have the meanings assigned to them in the Indenture. 

A-6

   
[FORM OF TRANSFER NOTICE] 

        FOR
VALUE RECEIVED the undersigned registered holder hereby sell(s), assign(s) and transfer(s) unto 

Insert
Taxpayer Identification No. 

	
 (Please print or typewrite name and address including zip code of assignee)
	

 the within Note and all rights thereunder, hereby irrevocably constituting and appointing
                                         
                        its attorney to transfer such Note on the books of the Issuer with full power of substitution in the
premises.

        [THE FOLLOWING PROVISION TO BE INCLUDED ON ALL NOTES

OTHER THAN EXCHANGE NOTES AND OFFSHORE PHYSICAL NOTES]

        In connection with any transfer of this Note occurring prior to the date which is the earlier of the (i) date of an effective Registration Statement or (ii) two years after the later of the
original issuance of this Note or the last date on which this Note was held by an Affiliate of the Issuer, the undersigned confirms that without utilizing any general solicitation or general advertising:

[Check One]

	o	 	(a) this Note is being transferred in compliance with the exemption from registration under the Securities Act of 1933, as amended, provided by Rule 144A thereunder,
	

 	
 	

or
	

o	
 	

(b) this Note is being transferred other than in accordance with (a) above and documents are being furnished which comply with the conditions of transfer set forth in this Note and the Indenture.

If neither of the foregoing boxes is checked, the Trustee or other Note Registrar shall not be obligated to register this Note in the name of any Person other than the Holder
hereof unless and until the conditions to any such transfer of registration set forth herein and in Section 305 of the Indenture shall have been satisfied. 

	

Date:	
 	

	
 	

	 	 	 	 	NOTICE:	 	The signature to this assignment must correspond with the name as written upon the face of the within-mentioned instrument in every particular, without alteration or any change whatsoever.
	Signature Guarantee4:

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

        The
undersigned represents and warrants that it is purchasing this Note for its own account or an account with respect to which it exercises sole investment discretion and that it or
such account is a "qualified institutional buyer" within the meaning of Rule 144A under the Securities Act of 1933, as amended, and that each 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 Issuer as the undersigned has requested pursuant to Rule 144A or has determined not to request
such information and that each 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. 

	

Date:	
 	

	
 	

	 	 	 	 	NOTICE:	 	To be executed by an executive officer

	4
	Guarantor
must be a member of the Securities Transfer Agents Medallion Program ("STAMP"), the New York Stock Exchange Medallion Signature Program ("MSP") or the Stock
Exchange Medallion Program ("SEMP"). 

A-7

 

OPTION OF HOLDER TO ELECT PURCHASE 

        If
you wish to have this Note purchased by the Issuer pursuant to Section 1010 or 1017 of the Indenture, check the Box: o 

        If you wish to have a portion of this Note purchased by the Trust pursuant to Section 1010 or 1017 of the Indenture, state the amount (in original
principal amount) below: 

        $                        . 

Date: 

Your
Signature:
                                         
                                          
                                     

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

Signature
Guarantee*:
                                         
                                          
                                     
 

	*
	Guarantor
must be a member of the Securities Transfer Agents Medallion Program ("STAMP"), the New York Stock Exchange Medallion Signature Program ("MSP") or the Stock Exchange Medallion
Program ("SEMP") 

A-8

   EXHIBIT B  

Form
of Certificate

to Be Delivered upon Termination of Restricted Period 

On
or after                        , 2004 

	Wachovia Bank, National Association, as Trustee

1021 East Cary Street

Richmond, Virginia 23219
	Attention:	 	Corporate Trust Administration

VA 9646
	

Re:	
 	

Primus Telecommunications Holding, Inc. (the "Issuer")

8% Senior Notes due 2014 (the "Notes")

Ladies
and Gentlemen: 

        This
letter relates to $                        principal amount of Notes represented by the global note certificate (the "Offshore
Global Note"). Pursuant to Section 202 of the Indenture
dated as of January 16, 2004 relating to the Notes (the "Indenture"), we hereby certify that (1) we are the beneficial owner of such principal amount of Notes represented by the Offshore
Global Note and (2) we are a Non-U.S. Person to whom the Notes could be transferred in accordance with Rule 904 of Regulation S promulgated under the U.S. Securities
Act of 1933, as amended ("Regulation S"). Accordingly, you are hereby requested to issue a Offshore Physical Note representing the undersigned's interest in the principal amount of Securities
represented by the Offshore Global Note, all in the manner provided by the Indenture. 

        You
and the Issuer are entitled to rely upon this letter and are irrevocably authorized to produce this letter or a copy hereof to any interested party in any administrative or legal
proceeding or official inquiry with respect to the matters covered hereby. Terms used in this certificate have the meanings set forth in Regulation S. 

	 
	 	 
	 	 

	 	 	Very truly yours,
	

 	
 	

[Name of Holder]
	

 	
 	

By:	
 	

 
	 	 	 	 	

	 	 	 	 	Authorized Signature

B-1

   EXHIBIT C  

Form
of Certificate to Be

Delivered in Connection with

Transfers to Non-QIB Institutional Accredited Investor 

[Date]

	Primus Telecommunications Holding, Inc.

c/o Wachovia Bank, National Association, as Trustee

1021 East Cary Street

Richmond, Virginia 23219
	Attention:	 	Corporate Trust Administration

VA 9646

	 	 	Re:	 	Primus Telecommunications Holding Inc. (the "Issuer")

8% Senior Notes due 2014 (the "Notes")

Ladies and Gentlemen: 

        In
connection with our proposed purchase of $                        aggregate principal amount of the Notes, we confirm that:

        1.     We
have received such information regarding the Issuer as we deem necessary in order to make our investment decision. 

        2.     We
understand that the Notes have not been registered under the Securities Act of 1933, as amended (the "Securities Act"), or any other applicable law; and may not be
offered, sold, or otherwise transferred 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 the Notes to offer,
sell or otherwise transfer such Notes prior to the date which is two years after the later of the date of original issue and the last date on which the Issuer or any affiliate of the Issuer was the
owner of such Notes, or any predecessor thereto (the "Resale Restriction Termination Date") only (a) to the Issuer, (b) pursuant to a registration statement which has been declared
effective under the Securities Act, (c) for so long as the Notes are eligible for resale pursuant to Rule 144A under the Securities Act, to a person we reasonably believe is a qualified
institutional buyer under Rule 144A (a "QIB") that purchases 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) pursuant to offers and sales to non-U.S. persons 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 subparagraph (a)(1), (2), (3) or (7) of Rule 501 of Regulation D under the Securities Act
acquiring the Notes for its own account or for the account of such an institutional "accredited investor" for investment purposes and not with a view to, or for offer or sale in connection with, any
distribution thereof in violation of the Securities Act or (f) pursuant to any other available exemption from the registration requirements of the Securities Act, subject in each of the
foregoing cases to any requirement of law that the disposition of our property and the property of such investor account or accounts be at all times within our or their control and to 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 (e) above prior to the Resale Restriction Termination Date, the transferor shall deliver a letter to the Trustee (the "Trustee") under the Indenture
pursuant to which the Notes are being issued a letter from the transferee substantially in the form of this letter, which shall provide, among other things, that the transferee is an institutional
"accredited investor" within the meaning of subparagraph (a)(1), (2), (3) or (7) of Rule 501 under the Securities Act and that it is acquiring such
Notes for investment purposes and not for distribution in violation of the Securities Act. We 

C-1

 

acknowledge
that the Issuer and the Trustee reserve the right prior to any offer, sale or other transfer prior to the Resale Restriction Termination Date of the Notes pursuant to clauses (d),
(e) and (f) above to require the delivery of an opinion of counsel, certifications and/or other information satisfactory to the Issuer and the Trustee. 

        3.     We
are an institutional "accredited investor" (as defined in Rule 501(a)(1), (2), (3) or (7) of Regulation D under the Securities Act)
purchasing for our own account or for the account of such an institutional "accredited investor," and we are acquiring the Notes 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, and 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 and any accounts for which we are acting are each able to bear the economic risk of our or its investment. 

        4.     We
are acquiring the Notes purchased by us for our own account or for one or more accounts as to each of which we exercise sole investment discretion. 

        5.     You
are entitled to rely upon this letter and you are irrevocably authorized to produce this letter or a copy hereof to any interested party in any administrative or
legal proceeding or official inquiry with respect to the matters covered hereby. 

	 	 	Very truly yours,
	

 	
 	

By:	
 	

(NAME OF PURCHASER)
	 	 	Date:	 	 

        Upon transfer, the Notes should be registered in the name of the new beneficial owner as follows: 

Name:
                                         
                                          
                  

Address:
                                         
                                          
             
 

Taxpayer
ID Number:                          

C-2

   EXHIBIT D  

        Form of Certificate to Be Delivered in

Connection with Transfers Pursuant to Regulation S 

[Date]

	 
	 	 

	Wachovia Bank, National Association, as Trustee

1021 East Cary Street

Richmond, Virginia 23219
	Attention:	 	Corporate Trust Administration

VA 9646
	

Re:	
 	

Primus Telecommunications Holding, Inc. (the "Issuer")

8% Senior Notes due 2014 (the "Notes")

Ladies
and Gentlemen: 

        In
connection with our proposed sale of $                        aggregate principal amount of Notes, we confirm that such sale has
been effected pursuant to and in accordance with
Regulation S ("Regulation S") under the Securities Act of 1933, as amended (the "Securities Act"), and accordingly, we hereby certify as follows: 

        1.
The offer of the Notes was not made to a person in the United States (unless such person or the account held by it for which it is acting is excluded from the definition of "U.S.
person" pursuant to Rule 902(k)(1) of Regulation S under the circumstances described in Rule 902(k)(2) of Regulation S) or specifically targeted at an identifiable group of
U.S. citizens abroad. 

        2.
Either (a) at the time the buy order was originated, the buyer was outside the United States or we and any person acting on our behalf reasonably believed that the buyer was
outside the United States or (b) the transaction was executed in, on or through the facilities of a designated offshore securities market, and neither we nor any person acting on our behalf
knows that the transaction was pre-arranged with a buyer in the United States. 

        3.
Neither we, any of our affiliates, nor any person acting on our or their behalf has made any directed selling efforts in the United States in contravention of the requirements of
Rule 903(a) or Rule 904(a) of Regulation S, as applicable. 

        4.
The proposed transfer of Notes is not part of a plan or scheme to evade the registration requirements of the Securities Act. 

        5.
If we are a dealer or a person receiving a selling concession or other fee or remuneration in respect of the Notes, and the proposed transfer takes place before the Offshore Note
Exchange Date referred to in the Indenture, dated as of October 15, 1999, among the Issuer and the Trustee, or we are an officer or director of the Issuer or a distributor, we certify that the
proposed transfer is being made in accordance with the provisions of Rules 903 and 904(b) of Regulation S. 

D-1

 

        You
and the Issuer are entitled to rely upon this Certificate and are irrevocably authorized to produce this Certificate or a copy hereof to any interested party in any administrative or
legal proceeding or official inquiry with respect to the matters covered hereby. Terms used in this certificate have the meanings set forth in Regulation S. 

	 
	 	 
	 	 

	 	 	Very truly yours,
	

 	
 	

[Name of Transferor]
	

 	
 	

By:	
 	

 
	 	 	 	 	

	 	 	 	 	Authorized Signature

D-2

  

EXHIBIT E  

        Rule 144A Certificate 

	 
	 	 
	 	 

	To:	 	Wachovia Bank, National Association, as Trustee

1021 East Cary Street

Richmond, Virginia 23219
	 	 	Attention:	 	Corporate Trust Administration

VA 9646
	

 	
 	

Re:	
 	

Primus Telecommunications Holding, Inc. (the "Issuer")

8% Senior Notes due 2014 (the "Notes")

Ladies
and Gentlemen: 

        In
connection with our proposed sale of $                        aggregate principal amount of Notes, we confirm that such sale has
been effected pursuant to and in accordance with
Rule 144A ("Rule 144A") under the Securities Act of 1933, as amended (the "Securities Act"). We are aware that the transfer of Notes to us is being made in reliance on the exemption from
the provisions of Section 5 of the Securities Act provided by Rule 144A. If the Issuer is not subject to Section 13 or 15(d) of the Exchange Act, prior to the date of this
Certificate we have been given the opportunity to obtain from the Issuer the information referred to in Rule 144A(d)(4), and have either declined such opportunity or have received such
information. 

        You
and the Issuer are entitled to rely upon this Certificate and are irrevocably authorized to produce this Certificate or a copy hereof to any interested party in any administrative or
legal proceeding or official inquiry with respect to the matters covered hereby. 

	 
	 	 
	 	 

	 	 	Very truly yours,
	

 	
 	

[NAME OF PURCHASER]
	

 	
 	

By:	
 	

 
	 	 	 	 	

	 	 	 	 	Name:
	 	 	 	 	Title:
	 	 	 	 	Address:

Date
of this Certificate:                            ,        

E-1

 
 
 

PRIMUS TELECOMMUNICATIONS GROUP, INCORPORATED    
    
    Reconciliation and tie between Trust Indenture Act
  of 1939 and Indenture, dated as of January 16, 2004    

	Trust Indenture

Act Section
 
	 	Indenture Section
 

	(S) 310	(a)(1)	 	607
	 	(a)(2)	 	607
	 	(b)	 	604, 608
	

(S) 312	

(c)	
 	

701
	

(S) 313	

(c)	
 	

601, 702
	

(S) 314	

(a)(4)	
 	

1008(a)
	 	(b)	 	1302
	 	(c)(1)	 	303
	 	(c)(2)	 	303
	 	(d)	 	1303, 1304
	 	(e)	 	102
	

(S) 315	

(b)	
 	

601
	 	(e)	 	608
	

(S) 316	

(a)(last sentence)	
 	

101 ("Outstanding")
	 	(a)(1)(B)	 	513
	 	(b)	 	508
	(S) 317	(a)(1)	 	503
	 	(a)(2)	 	504
	 	(b)	 	1003

	Note:
	This
reconciliation and tie shall not, for any purpose, be deemed to be a part of the Indenture. 

E-2

QuickLinks

TABLE OF CONTENTS

TESTIMONIUM SIGNATURE AND SEALS

ARTICLE ONE DEFINITIONS AND OTHER PROVISIONS OF GENERAL APPLICATION

ARTICLE SEVEN HOLDERS LISTS AND REPORTS BY TRUSTEE AND ISSUER

ARTICLE EIGHT CONSOLIDATION, MERGER, CONVEYANCE, TRANSFER OR LEASE

ARTICLE NINE SUPPLEMENTAL INDENTURES

ARTICLE ELEVEN REDEMPTION OF NOTES

ARTICLE TWELVE PARENT GUARANTEE

ARTICLE THIRTEEN COLLATERAL

ARTICLE FOURTEEN DEFEASANCE AND COVENANT DEFEASANCE

EXHIBIT A [FORM OF FACE OF NOTE] PRIMUS TELECOMMUNICATIONS HOLDING, INC. 8% [Series B]1 Senior Note Due 2014

PRIMUS TELECOMMUNICATIONS GROUP, INCORPORATED Reconciliation and tie between Trust Indenture Act of 1939 and Indenture, dated as of January 16, 2004QuickLinks
 -- Click here to rapidly navigate through this document

 
 

EXHIBIT 4.2    
    

CONFORMED COPY  

€460,000,000
MULTICURRENCY REVOLVING CREDIT FACILITIES 

for

GUCCI
GROUP N.V.

GUCCI LUXEMBOURG S.A., Lussemburgo, succursale Euro Financial Investments di 

Cadempino

GUCCI INTERNATIONAL N.V. 

guaranteed
by 

GUCCI
GROUP N.V.

and subsidiaries 

mandated
lead arranged by 

BANCA
POPOLARE DI MILANO S.C.a R.L.

CAPITALIA GRUPPO BANCARIO

CITIGROUP GLOBAL MARKETS LIMITED

ING BANK N.V.—MILAN BRANCH

MIZUHO CORPORATE BANK, LTD

SANPAOLO IMI S.P.A.—DIVISIONE IMPRESE

THE ROYAL BANK OF SCOTLAND PLC, MILAN BRANCH

UNICREDIT BANCA MOBILIARE S.p.A. 

co-arranged
by 

ABN
AMRO BANK N.V.—MILAN BRANCH

BANCA INTESA SPA—CENTRO CORPORATE DI FIRENZE

BANCA MONTE DEI PASCHI DI SIENA S.p.A.

BANCO POPOLARE DI VERONA E NOVARA (LUXEMBOURG) S.A.

BANCA TOSCANA S.p.A.

BNP PARIBAS S.A.

BANCA C.R. FIRENZE—CENTRO IMPRESE FIRENZE OVEST

WESTLB IRELAND PLC 

 
 

CONTENTS    
    

	Clause
 
	 	Page

	1.	 	DEFINITIONS AND INTERPRETATION	 	4
	

2.	
 	

THE FACILITIES	
 	

15
	

3.	
 	

UTILISATION OF THE FACILITIES	
 	

16
	

4.	
 	

PAYMENT AND CALCULATION OF INTEREST	
 	

18
	

5.	
 	

MARKET DISRUPTION AND ALTERNATIVE INTEREST RATES	
 	

19
	

6.	
 	

REPAYMENT	
 	

20
	

7.	
 	

CANCELLATION AND PREPAYMENT	
 	

20
	

8.	
 	

TAXES	
 	

21
	

9.	
 	

TAX RECEIPTS	
 	

22
	

10.	
 	

CHANGES IN CIRCUMSTANCES	
 	

23
	

11.	
 	

REPRESENTATIONS	
 	

25
	

12.	
 	

FINANCIAL INFORMATION	
 	

28
	

13.	
 	

FINANCIAL CONDITION	
 	

30
	

14.	
 	

COVENANTS	
 	

32
	

15.	
 	

EVENTS OF DEFAULT	
 	

36
	

16.	
 	

GUARANTEE AND INDEMNITY	
 	

39
	

17.	
 	

DEFAULT INTEREST AND INDEMNITY	
 	

43
	

18.	
 	

CURRENCY OF ACCOUNT AND PAYMENT	
 	

45
	

19.	
 	

PAYMENTS	
 	

45
	

20.	
 	

SET-OFF	
 	

47
	

21.	
 	

SHARING	
 	

47
	

22.	
 	

COMMITMENT COMMISSION AND FEES	
 	

48
	

23.	
 	

COSTS AND EXPENSES	
 	

49
	

24.	
 	

THE AGENTS, THE MANDATED LEAD ARRANGERS, THE CO-ARRANGERS AND THE BANKS	
 	

50
	

25.	
 	

ASSIGNMENTS AND TRANSFERS	
 	

54
	

26.	
 	

CALCULATIONS AND EVIDENCE OF DEBT	
 	

57
	

27.	
 	

REMEDIES AND WAIVERS, PARTIAL INVALIDITY	
 	

58
	

28.	
 	

NOTICES AND COUNTERPARTS	
 	

58
	

29.	
 	

AMENDMENTS AND ADDITIONAL BORROWERS AND GUARANTORS	
 	

59
	

30.	
 	

LAW AND JURISDICTION	
 	

63
	

SCHEDULE 1 The Banks And Commitments	
 	

65
	 	 	Part A-1 Facility A Commitments	 	65
	 	 	Part B-1 Facility B Commitments	 	66
	
SCHEDULE 2 Form Of Transfer Certificate	
 	

66
	 	 	 	 	 

	

SCHEDULE 3 Condition Precedent Documents	
 	

69
	 	 	Part 1	 	69
	
SCHEDULE 4	
 	

71
	 	 	Part A Notice Of Drawdown	 	71
	 	 	Part B Term-Out Notice	 	72
	
SCHEDULE 5 Additional Borrowers	
 	

72
	 	 	Part A Form Of Borrower Accession Memorandum	 	72
	 	 	Part B Documents To Accompany Borrower Accession Memorandum	 	74
	
SCHEDULE 6 Additional Guarantors	
 	

74
	 	 	Part A Form Of Guarantor Accession Memorandum	 	74
	 	 	Part B Documents To Accompany Guarantor Accession Memorandum	 	76
	 	 	Part C Form Of Original Guarantor Accession Memorandum	 	77
	
SCHEDULE 7 Form Of Compliance Certificate	
 	

78
	

SCHEDULE 8 Calculation Of The Mandatory Cost	
 	

79

THIS AGREEMENT is dated 28th November, 2003 and made BETWEEN: 

	a.
	GUCCI GROUP N.V., GUCCI LUXEMBOURG S.A., a société anonyme
incorporated under the laws of Luxembourg with registered office at 12, rue Léon Thyes, L-2636 Luxembourg and registered with the register of commerce and companies of
Luxembourg under the number B69.008, Lussemburgo, succursale Euro Financial Investments di Cadempino and GUCCI INTERNATIONAL N.V. as borrowers (each a
"Borrower" and together with all entities becoming additional Borrowers pursuant to Clause 0 (Additional
Borrowers), the "Borrowers");

	b.
	GUCCI GROUP N.V., GUCCI LUXEMBOURG S.A., a société anonyme incorporated under the laws of Luxembourg with
registered office at 12, rue Léon Thyes, L-2636 Luxembourg and registered with the register of commerce and companies of Luxembourg under the number B69.008, Lussemburgo,
succursale Euro Financial Investments di Cadempino and GUCCI INTERNATIONAL N.V. as guarantors (each a
"Guarantor" and together with all entities becoming additional Guarantors pursuant to Clause 0 (Additional
Guarantors) and/or 0 (Original Guarantors) the "Guarantors");

	c.
	GUCCI LUXEMBOURG S.A., Lussemburgo, succursale Euro Financial Investments di Cadempino as borrowers' agent (in this capacity the
"Borrowers' Agent");

	d.
	BANCA POPOLARE DI MILANO S.C.a R.L., CAPITALIA GRUPPO BANCARIO, CITIGROUP GLOBAL MARKETS LIMITED, ING BANK N.V.—MILAN BRANCH, MIZUHO CORPORATE
BANK, LTD, SANPAOLO IMI S.P.A—DIVISIONE IMPRESE, THE ROYAL BANK OF SCOTLAND PLC, MILAN BRANCH and UNICREDIT BANCA MOBILIARE
S.p.A. as the mandated lead arrangers (the "Mandated Lead Arrangers");

	e.
	ABN AMRO BANK N.V.—MILAN BRANCH, BANCA DI ROMA SPA, BANCA INTESA SPA—CENTRO CORPORATE DI FIRENZE, BANCA MONTE DEI PASCHI DI SIENA
S.p.A., BANCO POPOLARE DI VERONA E NOVARA (LUXEMBOURG) S.A., BANCA TOSCANA S.p.A., BIPOP CARIRE, SOCIETA PER AZIONI, BNP PARIBAS S.A., BANCA C.R. FIRENZE—CENTRO IMPRESE FIRENZE
OVEST and WESTLB IRELAND PLC as the co-arrangers (the
"Co-Arrangers");

	f.
	UNICREDITO ITALIANO S.p.A., London Branch as facility agent (in this capacity the "Facility
Agent") and as security agent (in this capacity, the "Security Agent"); and

	g.
	THE BANKS (as defined below). 

IT IS AGREED as follows: 

 
 

Definitions and Interpretation    
    

Definitions  

In
this Agreement the following terms have the meanings given to them in this Clause 0. 

        "Advance" means a Facility A Advance or a Facility B Advance. 

        "Agent" means the Facility Agent or the Security Agent. 

        "Available Facility A Amount" means, at any time, the aggregate amount of the Available Facility A Commitments at such time. 

        "Available Facility Amount" means the Available Facility A Amount or the Available Facility B Amount. 

        "Available Facility B Amount" means, at any time, the aggregate amount of the Available Facility B Commitments at such time. 

        "Available Facility A Commitment" means, in relation to a Bank at any time and save as otherwise provided herein, its Facility A
Commitment at such time less the aggregate of its portions of the Euro 

 

Amounts
of the Facility A Advances which are then outstanding (provided that such amount shall not be less than zero). 

        "Available Facility B Commitment" means, in relation to a Bank at any time and save as otherwise provided herein, its Facility B
Commitment at such time less the aggregate of its portions of the Euro Amounts of the Facility B Advances which are then outstanding (provided that such
amount shall not be less than zero). 

        "Bank" means: 

	(a)
	any
financial institution named in Schedule 1 (The Banks and Commitments) (other than one which has ceased to be a party hereto
in accordance with the terms hereof); or

	(b)
	any
financial institution which has become a party hereto in accordance with the provisions of Clause 0 (Assignments by Banks)
or Clause 0 (Transfers by Banks). 

        "Basle Paper" means the paper entitled "International Convergence of Capital Measurement and Capital Standards" dated July 1988 and
prepared by the Basle Committee on Banking Regulations and Supervision, as amended in November 1991. 

        "Borrower Accession Memorandum" means a duly completed letter agreement in the form of Part A (Form of
Borrower Accession Memorandum) of Schedule 5 (Additional Borrowers) with such amendments as the Facility Agent may
approve or reasonably require. 

        "Capital Adequacy Requirement" means a request or requirement relating to the maintenance of capital, including one which makes any change
to, or is based on any alteration in, the interpretation of the Basle Paper or which increases the amounts of capital required thereunder, other than a request or requirement made by way of
implementation of the Basle Paper in the manner in which it is being implemented at the date hereof. 

        "Commitment" means, in relation to a Bank, its Facility A Commitment or its Facility B Commitment. 

        "Core Guarantor" means any Guarantor which owns any Material Intellectual Property or which is a Borrower. 

        "Dollars" or "US$" means the lawful currency for the time being of the United States of
America. 

        "Dutch Borrower" means a Borrower which is incorporated in the Netherlands comprising, at the date hereof, Gucci Group N.V. and Gucci
International N.V.. 

        "Dutch Obligors" means an Obligor which is incorporated in the Netherlands, comprising, at the date hereof, Gucci Group N.V., Gucci
International N.V. and Yves Saint Laurent International B.V.. 

        "ERISA" means the United States Employee Retirement Income Security Act of 1974, as amended. 

        "ERISA Affiliate" means each trade or business, whether or not incorporated, that would be treated as a single employer with any Obligor
under section 414 of the United States Internal Revenue Code of 1986, as amended. When any provision of this Agreement relates to a past event in the context of employee benefits, the term
"ERISA Affiliate" includes any person that was an ERISA Affiliate of an Obligor at the time of that past event. 

        "Euro Amount" means: 

	(a)
	in
relation to any Advance, its Original Euro Amount as reduced by the proportion (if any) of such Advance which has been repaid; and

	(b)
	in
relation to the Loan, the aggregate of the Euro Amounts of the outstanding Advances. 

2

 

        "Euro" or "€" means the single currency of the Participating Member
States. 

        "Event of Default" means any circumstances described as such in Clause 0 (Events of
Default). 

        "Exemption Regulation" means the Exemption Regulation dated 26 June 2002 of the Ministry of Finance of the Netherlands, as
promulgated in connection with the Dutch Act on the Supervision of Credit Institutions 1992 (Wet toezicht kredietwezen 1992). 

        "Existing Facility" means the facility made available under the Euro 1,000,000,000 credit facility agreement dated 21 July 2000 (as
amended from time to time) between Gucci Group N.V., Gucci International N.V., Gucci Luxembourg S.A., Cadempino Branch, UniCredito Italiano S.p.A., London Branch as the Facility Agent and the Security
Agent and others. 

        "Facility" means Facility A or Facility B. 

        "Facility A" means the revolving credit facility with term-out option referred to in sub-clause 0 of
Clause 0 (Grant of the Facilities). 

        "Facility A Advance" means, save as otherwise provided herein, an advance drawn, or to be drawn, under Facility A. 

        "Facility A Commitment" means: 

	(c)
	in
relation to a Bank which is a Bank on the date of this Agreement the amount in Euros set opposite its name in Part A (Facility A
Commitments) of Schedule 1 (The Banks and Commitments) and the amount of any other Bank's Facility A Commitment acquired
by it under Clause 0 (Assignments by Banks) or Clause 0 (Transfers by Banks); or

	(d)
	in
relation to a Bank which becomes a Bank after the date of this Agreement, the amount of any other Bank's Facility A Commitment acquired by it under Clause 0
(Assignments by Banks) or Clause 0 (Transfers by Banks), 

        to
the extent not cancelled, reduced or transferred under this Agreement. 

        "Facility A Maturity Date" means the date falling a year less a day after the date of this Agreement or, if that is not a business day,
the immediately preceding business day. 

        "Facility B" means the revolving credit facility referred to in sub-clause 0 of Clause 0
(Grant of the Facilities). 

        "Facility B Advance" means, save as otherwise provided herein, an advance drawn, or to be drawn, under Facility B. 

        "Facility B Commitment" means: 

	(e)
	in
relation to a Bank which is a Bank on the date of this Agreement, the amount in Euros set opposite its name in Part B (Facility B
Commitments) of Schedule 1 (The Banks and Commitments) and the amount of any other Bank's Facility B Commitment acquired
by it under Clause 0 (Assignments by Banks) or Clause 0 (Transfers by Banks); or

	(f)
	in
relation to a Bank which becomes a Bank after the date of this Agreement, the amount of any other Bank's Facility B Commitment acquired by it under Clause 0
(Assignments by Banks) or Clause 0 (Transfers by Banks), 

        to
the extent not cancelled, reduced or transferred under this Agreement. 

        "Facility Office" means the office(s) notified by a Bank to the Facility Agent: 

	(g)
	on
or before the date it becomes a Bank; or

	(h)
	by
not less than five business days' notice, 

3

 

        as
the office(s) through which it will perform all or any of its obligations under this Agreement. 

        "Fee Letter" means any letter between the Banks and the Parent (or either of the Agents and the Parent) setting out any of the fees
referred to in Clause 0 (Commitment Commission and Fees). 

        "Final Maturity Date" means the third anniversary of the date of this Agreement or, if that is not a business day, the immediately
preceding business day. 

        "Finance Document" means this Agreement, the Fee Letter, a Transfer Certificate, a Borrower Accession Memorandum, a Guarantor Accession
Memorandum, a Security Document and any other document designated as such by the Facility Agent and the Parent. 

        "Finance Party" means an Agent, a Mandated Lead Arranger, a Co-Arranger or a Bank. 

        "French Obligor" means an Obligor which is incorporated in France, comprising, at the date hereof, GG France Holding S.A.S, Yves Saint
Laurent S.A.S., YSL Beauté S.A.S. and Yves Saint Laurent Parfums S.A.. 

        "Group" means the Parent and its subsidiaries for the time being. 

        "Guarantor Accession Memorandum" means a deed in the form of Part A (Form of Guarantor Accession
Memorandum) of Schedule 6 (Additional Guarantors) with such amendments as the Facility Agent may approve or reasonably
require. 

        "Hong Kong Obligor" means an Obligor which is incorporated in Hong Kong, comprising, at the date hereof, Gucci Group (Hong Kong) Limited. 

        "IFRS/IAS" means International Financing Reporting Standards and International Accounting Standards, respectively. 

        "Information Memorandum" means the document dated October 2003 concerning the Group (and the documents expressed to be attached
thereto) which, at the Borrowers' request and on their behalf, was prepared in relation to this transaction. 

        "Instructing Group" means: 

	(i)
	whilst
no Advances are outstanding hereunder, a Bank or group of Banks whose Commitments amount (or, if each Bank's Commitment has been reduced to zero, did immediately
before such reduction to zero, amount) in aggregate to more than 662/3 per cent. of the Total Commitments; and

	(j)
	whilst
at least one Advance is outstanding hereunder, a Bank or group of Banks to which in aggregate more than 662/3 per cent. of the Euro Amount of the Loan is owed. 

        "Italian Obligor" means an Obligor which is incorporated in Italy, comprising, at the date hereof, Luxury Goods Italia S.p.A., Gucci
Logistica S.p.A. and Gucci Finanziaria S.p.A. 

        "Japanese Obligor" means an Obligor which is incorporated in Japan, comprising, at the date hereof, Gucci Group Japan Holding Limited,
Gucci Group Japan Limited and Yugen Kaisha Gucci. 

        "LIBOR" means, in relation to any Term for an Advance or in relation to an unpaid sum, the rate per annum determined by the Facility Agent
to be equal to: 

	(k)
	the
offered rate (if any) appearing on the relevant page of the Telerate screen which displays British Bankers Association Interest Settlement Rates for deposits in the currency in
which such Advance or unpaid sum is denominated and for the specified period; or

	(l)
	if
the Facility Agent is unable to access the Telerate screen or if the relevant rate does not appear on the relevant page of the Telerate screen, the arithmetic mean (rounded
upwards, if necessary, to four decimal places) of the rates (as notified to the Facility Agent) at which each 

4

 

of
the Reference Banks was offering to prime banks in the London interbank market deposits in the currency in which such Advance or unpaid sum is denominated and for the specified period, 

        in
each case at or about 11.00 a.m. on the Quotation Date for such period and, for the purposes of this definition, "specified
period" means the relevant Term of such Advance or, as the case may be, the period in respect of which LIBOR falls to be determined in relation to such unpaid sum. 

        "Loan" means the aggregate principal amount for the time being outstanding hereunder. 

        "Luxembourg Obligor" means an Obligor which is incorporated in Luxembourg comprising, at the date hereof, Gucci Luxembourg S.A.
Lussemburgo, succursale Euro Financial Investments di Cadempino. 

        "Mandatory Cost" means the cost imputed to the Banks of compliance with: 

	(m)
	the
cash ratio and special deposit requirements of the Bank of England and/or the banking supervision or other costs imposed by the United Kingdom Financial Services Authority, as
determined in accordance with Schedule 8 (Calculation of the Mandatory Cost); and

	(n)
	the
reserve asset requirements imposed by, or on behalf of, the European Central Bank, as determined by the relevant Bank, acting reasonably. 

        "Margin" means: 

	(o)
	in
relation to any Facility A Advance, 0.50 per cent. per annum; and

	(p)
	in
relation to any Facility B Advance, 0.60 per cent per annum; 

        but
if on any date following the delivery of the first set of accounts pursuant to Clause 0 (Annual Accounts) or Clause 0
(Semi-annual Statements): 

	(i)
	no
Event of Default has occurred which is continuing; and

	(ii)
	the
ratio of Net Financial Indebtedness to EBITDA in respect of the most recently completed Financial Half Year is within one of the ranges set out below, 

        then
the Margin for each Advance under Facility A and Facility B will be the percentage per annum set out below in the column for that Facility opposite that range: 

	Net Financial Indebtedness to EBITDA
 
	 	Facility A Margin % p.a.
	 	Facility B Margin % p.a.

	Less than 1:1	 	0.50	 	0.60
	Less than or equal to 2.0:1 but greater than or equal to 1:1	 	0.70	 	0.80
	Greater than 2.0:1	 	0.85	 	0.95

(and
any change in that Margin shall take effect two business days after the date of receipt by the Facility Agent of the financial statements for a financial year or a Financial Half Year pursuant to
Clause 0 (Annual Statements) and Clause 0 (Semi-annual Statements)
respectively or, if it has not so taken effect because an Event of Default is continuing, on the first day on which that Event of Default ceases to be continuing). 

        For
the purposes of determining the Margin, Net Financial Indebtedness, EBITDA and Financial Half Year shall be as defined in Clause 0
(Definitions of Financial Terms). 

        "Material Company" means any Obligor or any other member of the Group whose total assets or earnings before interest and tax or turnover
represent respectively more than five per cent. of the consolidated total assets or consolidated earnings before interest and tax or consolidated turnover of the Group (all as determined by reference
to the special purpose standard forms, specially prepared by 

5

 

the
management of the Parent's subsidiaries, solely in order to enable the Group to prepare its audited consolidated financial statements in accordance with International Accounting Standards). 

        "Material Intellectual Property" means: 

	(q)
	the
Gucci and Yves Saint Laurent (YSL) trademarks and logos; and

	(r)
	all
trademarks, trading names and logos acquired or an interest in which is acquired by the Group after the date of this Agreement:

	(i)
	for
a consideration of €500 million (or equivalent) or more in relation to any one acquisition or series of related acquisitions; or

	(ii)
	which
are owned by, or licensed to, a company the goodwill element of the purchase consideration for which is €500 million (or equivalent) or more, 

        which,
in each case, upon acquisition, are owned by a company the ownership interest of the Group in which exceeds 50 per cent. 

        "Multiemployer Plan" means a "multiemployer plan" within the meaning of
section 3(37) or 4001(a)(3) of ERISA. 

        "Notice of Drawdown" means a notice given by the Borrowers' Agent on behalf of a Borrower for an Advance, substantially in the form set
out in Part A (Notice of Drawdown) of Schedule 4. 

        "Obligors" means the Borrowers and the Guarantors. 

        "Optional Currency" means Dollars and any other currency (other than Euros) which is for the time being freely transferable and
convertible into Euros and deposits of which are readily available in the London interbank market. 

        "Original Euro Amount" means, in relation to an Advance, the amount thereof requested in the Notice of Drawdown relating thereto (as the
same may be reduced pursuant to Clause 0 (Reduction of available amount)) or, if such Advance is not denominated in Euros, the equivalent of such
amount (as the same may be so reduced) in Euros, calculated by the Facility Agent as at the date of such Notice of Drawdown. 

        "Original Financial Statements" means the audited consolidated financial statements of the Group for its financial year ended 31 January,
2003. 

        "Original Guarantor Accession Memorandum" means a deed in the form of Part C (Form of Guarantor Accession
Memorandum) of Schedule 6 (Additional Guarantors) with such amendments as the Facility Agent may approve or reasonably
require. 

        "Original Guarantor" means GG France Holding S.A.S (Registration number B421025891), Gucci America Inc., Luxury Goods Italia
S.p.A., Gucci Group Japan Holding Limited (Registration number 0104-01-008378), Gucci Logistica S.p.A., Luxury Timepieces International S.A., Yves Saint Laurent S.A.S.
(Registration number B342547361), Yves Saint Laurent Parfums S.A. (Registration number B329746945), Yves Saint Laurent International B.V., Luxury Goods International S.A. (Registration number
CH-514.3.012.378-4)), Yugen Kaisha Gucci (Registration number 0104-02-022378), Gucci Finanziaria S.p.A. (Registration number 02339420487), Gucci Group
(Hong Kong) Limited (Registration number 38649), Gucci Group Japan Limited (Registration number 0104-01-044641), YSL Beauté S.A.S. (Registration number
B304941776), Boucheron Joaillerie (USA), Inc., and Yves Saint Laurent America, Inc. and each an "Original Guarantor". 

        "Parent" means Gucci Group N.V. 

6

 

        "Participating Member States" means a member state of the European Communities that adopts or has adopted the Euro as its currency in
accordance with legislation of the European Union relating to European Economic and Monetary Union. 

        "Permitted Encumbrance" means: 

	(s)
	any
encumbrance arising in the ordinary course of business solely by operation of law (or by an agreement evidencing the same) and not by reason of default;

	(t)
	retention
of title arrangements in respect of the deferred purchase price of assets entered into in the ordinary course of business where the purchase price is deferred for a period
in line with customary market practices;

	(u)
	any
encumbrance existing over assets of a company becoming a member of the Group after the date hereof securing indebtedness existing at the time of acquisition;

	(v)
	any
(i) mortgage over real estate securing long term indebtedness with a maturity date falling after the third anniversary of the date of this Agreement; and (ii) any
other encumbrance securing indebtedness of the Group, provided that the aggregate amount of indebtedness secured in respect of (i) and
(ii) shall not exceed €575,000,000 (or its equivalent in other currencies);

	(w)
	a
pledge of up to US$350,000,000 cash given by Gucci Luxembourg S.A., Cadempino Branch to Citibank NA to secure an irrevocable standby letter of credit issued by Citibank NA on
22nd October 2001 for the benefit of the Parent's minority shareholders in connection with settlement agreements between the Parent, LVMH—Möet Hennessey
Louis Vuitton S.A. and PPR (as defined in Clause 0 (Change of Control)); and

	(x)
	any
encumbrance over shares in any member of the Group securing the Existing Facility or this Agreement. 

        "Plan" means an "employee benefit plan" within the meaning of section 3(3) of ERISA
maintained by any Obligor or any ERISA Affiliate currently or at any time within the last five years, or to which any Obligor or any ERISA Affiliate is required to make payments or contributions or
has made payments or contributions within the past five years. 

        "PMP" means a professional market party (professionele marktpartij) within the meaning of
the Exemption Regulation. 

        "Policy Guidelines" means the Dutch Central Bank's Policy Guidelines (issued in relation to the Exemption Regulation) dated 10
July 2002 (beleidsregel kernbegrippen markttoetreding en bandhaving Wtk 1992). 

        "Potential Event of Default" means any event which may become (with the passage of time, the giving of notice, the making of any
determination hereunder or any combination thereof) an Event of Default. 

        "Proportion" means, in relation to a Bank: 

	(y)
	whilst
no Advances are outstanding hereunder, the proportion borne by the aggregate of its Commitments to the Total Commitments (or, if the Total Commitments are then zero, by the
aggregate of its Commitments to the Total Commitments immediately prior to their reduction to zero); or

	(z)
	whilst
at least one Advance is outstanding hereunder, the proportion borne by its share of the Euro Amount of the Loan to the Euro Amount of the Loan. 

7

 

        "Qualifying Bank" means any bank or other financial institution in respect of which, subject to completion and delivery of all appropriate
documentation, Gucci Group N.V. and Gucci International N.V. (in their capacities as Borrowers) will not be obliged to make any withholding or deduction on account of tax from payments of principal,
interest or fees made to such bank under Dutch law and/or applicable double tax treaties at the date hereof (or, in the case of a Transferee, the date of the relevant Transfer Certificate). 

        "Quotation Date" means, in relation to any period for which an interest rate is to be determined hereunder, the day on which quotations
would ordinarily be given by prime banks in the London interbank market for deposits in the currency in relation to which such rate is to be determined for delivery on the first day of that period,  provided
that, if, for any such period, quotations would ordinarily be given on more than one date, the Quotation Date for that period shall be the last
of those dates. 

        "Reference Banks" means the Facility Agent, Citibank NA and The Royal Bank of Scotland plc or such banks as may be appointed as such by
the Facility Agent with the consent of the Parent (not to be unreasonably withheld or delayed). 

        "Regulations T, U and X" means, respectively, Regulations T, U and X of the Board of Governors of the Federal Reserve System of the United
States of America (or any successor) as now and from time to time in effect from the date of this Agreement. 

        "Reportable Event" means any of the events set forth in section 4043 of ERISA or the related regulations with respect to which the
30 day notice requirement has not been waived. 

        "Repayment Date" means, in relation to any Revolving Advance, the last day of the Term thereof or, in relation to the Term Advances, the
Term-out Maturity Date. 

        "Revolving Advance" means an Advance designated as such by Clause 0 (Type of
Advance). 

        "Rollover Advance" means one or more Advance which is: 

	(aa)
	made
or to be made on the same day that a maturing Advance is due to be repaid; and

	(bb)
	the
aggregate amount of which is equal to or less than the maturing Advance; and

	(cc)
	in
the same currency as the maturing Advance; and

	(dd)
	made
or to be made to the same Borrower for the purpose of refinancing a maturing Advance. 

        "Security Documents" means any share pledges or asset security documents executed pursuant to Clause 0
(Additional Guarantors). 

        "Sterling" or "£" means the lawful currency for the time being of the United
Kingdom. 

        "Swiss Code of Obligations" means the Swiss Federal Act of 30th March, 1911, as amended, regarding the fifth part of the Swiss Civil Code. 

        "Swiss Federal Tax Administration" means the Swiss Federal Tax Administration in Berne, Switzerland. 

        "Swiss Federal Withholding Tax" means the taxes levied by the Swiss Federal Tax Administration pursuant to the Swiss Federal Act regarding
the withholding tax ("Verrechnungssteuer") of 13th October, 1996, as amended. 

        "Swiss Obligor" means an obligor which is incorporated in Switzerland, comprising, at the date hereof, Luxury Timepieces International
S.A. and Luxury Goods International S.A. 

8

 

        "TARGET Day" means a day on which the Trans-European Automated Real-Time Gross Settlement Express Transfer (TARGET) system is
open. 

        "Term" means, save as otherwise provided herein, each period determined in accordance with Clause 0 (Terms
of Advances). 

        "Term Advance" means an advance designated as such by Clause 0 (Type of Advance). 

        "Term-out Date" means the date specified as such in the Term-out Notice. 

        "Term-out Maturity Date" means the date specified as such in the Term-out Notice. 

        "Term-out Notice" means a notice given by the Borrowers' Agent to exercise the Term-out Option, substantially in
the form set out in Part B (Term-Out Notice) of Schedule 4. 

        "Term-out Option" means the Borrowers' Agent's option to convert the Facility A Advances into term loans, as more particularly
described in Clause 0 (Term-out Option). 

        "Total Commitments" means the aggregate of the Total Facility A Commitments and the Total Facility B Commitments. 

        "Total Facility A Commitments" means the aggregate of the Facility A Commitments of all the Banks, being €230,000,000 at
the date of this Agreement. 

        "Total Facility Amount" means €460,000,000 at the date of this Agreement. 

        "Total Facility B Commitments" means the aggregate of the Facility B Commitments of all the Banks, being €230,000,000 at
the date of this Agreement. 

        "Transfer Certificate" means a certificate substantially in the form set out in Schedule 2 (Form of
Transfer Certificate) signed by a Bank and a Transferee whereby: 

	(ee)
	such
Bank seeks to procure the transfer to such Transferee of all or a part of such Bank's rights, benefits and obligations hereunder as contemplated in Clause 0
(Assignments and Transfers by Banks); and

	(ff)
	such
Transferee undertakes to perform the obligations it will assume as a result of delivery of such certificate to the Facility Agent as is contemplated in Clause 0
(Transfers by Banks). 

        "Transfer Date" means, in relation to any Transfer Certificate, the date for the making of the transfer as specified in the schedule to
such Transfer Certificate. 

        "Transferee" means a bank or other financial institution to which a Bank seeks to transfer all or part of such Bank's rights, benefits and
obligations hereunder. 

        "US Obligor" means an Obligor which is incorporated in the United States of America, comprising, at the date hereof, Gucci
America Inc., Boucheron Joaillerie (USA), Inc. and Yves Saint Laurent America, Inc. 

        "Verifiable PMP" means a PMP whose status as such may be determined on the basis of: 

	(gg)
	its
entry in the Dutch public register (including on-line registers available on the internet) as referred to in Clauses 1.e.1 through 1.e.5 of the Exemption Regulation;
or

	(hh)
	a
public register published by a regulator of a country as referred to in Clause 1.e.11 of the Exemption Regulation exercising prudential supervision over the PMP to the
extent generally accessible via the internet. 

9

 

Interpretation  

        Any reference in this Agreement to: 

any "Agent" or any "Bank" shall be construed so as to include its and any subsequent successors, Transferees and assigns in accordance with their respective interests;  

        on an "arm's-length basis" means on terms that are fair and reasonable to the relevant member of the Group and no more or less favourable
to the relevant person (being the other party to the relevant transaction) than could reasonably be expected to be obtained in a comparable arm's-length transaction with a person which is not an
affiliate of the relevant member of the Group;  

        "borrow" means to incur financial indebtedness falling within sub-paragraph (a), (b) or (c) of the
definition thereof and "borrowings" shall be construed accordingly;  

        a "business day" shall be construed as a reference to a day (other than a Saturday or Sunday) on which (i) banks generally are open
for business in London and (ii) if such reference relates to a date for the payment or purchase of any sum denominated in an Optional Currency, banks generally are open for business in the
principal financial centre of the country of such Optional Currency and (iii) if such reference relates to a date for the payment of any sum denominated in Euros, a TARGET Day;  

        an "encumbrance" shall be construed as a reference to (a) a mortgage, charge, pledge, lien or other encumbrance (not including
rights of set-off contained in banks' standard terms of business or arising in the ordinary course of business of a member of the Group) securing any financial indebtedness of any person
or (b) any other type of preferential arrangement (including title, transfer and retention arrangements) having a similar effect;  

        the "equivalent" on any given date in one currency (the "first currency") of an amount denominated in another currency (the "second
currency") is a reference to the amount of the first currency which could be purchased with the amount of the second currency at the spot rate of exchange quoted by the Facility Agent at or about
11.00 a.m. on such date for the purchase of the first currency with the second currency;  

 "financial indebtedness" means any indebtedness incurred in respect of:

        the principal amount, and the capitalised element (if any) of money borrowed or raised and debit balances at banks and premiums (if any) and capitalised interest
in respect thereof;

        the principal and premiums (if any) and capitalised interest in respect of any debenture, bond, note, loan stock or similar instrument;

        liabilities (including pursuant to counter-indemnities and reimbursement obligations) in respect of any letter of credit, standby letter of credit securing
financial indebtedness arising under this definition, acceptance credit, bill discounting or note purchase facility and any receivables purchase, factoring or discounting arrangements (to the extent
that such arrangement is with recourse to any member of the Group);

        the amount of any financial liabilities arising from the accounting for of leases, which, in accordance with IFRS/IAS, qualify as financial leasing and are
accordingly recorded as such in the financial statements of the relevant member of the Group;

        the deferred purchase price of assets or services (except any such arrangement entered into in the ordinary course of trading and having a term not exceeding
365 days from the date on which the liability was originally incurred);

        liabilities in respect of any foreign exchange agreement (other than foreign exchange agreements for spot delivery), currency or interest purchase or swap or
other derivative transactions or similar  

10

 

 arrangements and the amount of the financial indebtedness in relation to any such transaction shall be calculated by reference to the mark-to-market valuation of any such
transaction at the relevant time;

        all obligations to purchase, redeem, retire, defease or otherwise acquire for value any share capital of any person or any warrants, rights or options to acquire
such share capital where such obligation, warrant, right or option is, by its terms, to exist for more than 365 days from the date it was originally incurred;

any other transactions having the commercial effect of borrowing; and  

        all financial indebtedness of other persons of the kinds referred to in paragraphs (a) to (h) above guaranteed or
indemnified directly or indirectly in any manner by any member of the Group, or having the commercial effect of being guaranteed or indemnified directly or indirectly by any member of the
Group,

        provided that, for the purposes of Clause 0 (Financial Condition), any financial
indebtedness which is fully secured by the provision of cash collateral, in an amount equal to or greater than the amount of such financial indebtedness, shall not be included in the definition of
financial indebtedness; 

        a "holding company" of a company or corporation shall be construed as a reference to any company or corporation of which the first-mentioned company or
corporation is a subsidiary;  

        "indebtedness" shall be construed so as to include any obligation (whether incurred as principal or as surety) for the payment or
repayment of money, whether present or future, actual or contingent;  

        a "month" is a reference to a period starting on one day in a calendar month and ending on the numerically corresponding day in the next
succeeding calendar month save that, where any such period would otherwise end on a day which is not a business day, it shall end on the next succeeding business day, unless that day falls in the
calendar month succeeding that in which it would otherwise have ended, in which case it shall end on the immediately preceding business day provided that, if a period starts on the last business day
in a calendar month or if there is no numerically corresponding day in the month in which that period ends, that period shall end on the last business day in that later month (and references to
"months" shall be construed accordingly);  

        a "person" shall be construed as a reference to any person, firm, company, corporation, government, state or agency of a state or any
association or partnership (whether or not having separate legal personality) of two or more of the foregoing;  

        a "subsidiary" of a company or corporation shall be construed as a reference to any company or corporation:  

        which is controlled, directly or indirectly, by the first-mentioned company or corporation;

        more than half the issued share capital of which is beneficially owned, directly or indirectly, by the first-mentioned company or corporation; or  

        which is a subsidiary of another subsidiary of the first-mentioned company or corporation  

        and, for these purposes, a company or corporation shall be treated as being controlled by another if that other company or corporation is able to direct its
affairs and/or to control the composition of its board of directors or equivalent body; 

        "tax" shall be construed so as to include any tax, levy, impost, duty or other charge of a similar nature (including any penalty or interest payable in connection
with any failure to pay or any delivery in paying any of the same) including, without limitation, imposta sostitutiva;

11

 

        "VAT" shall be construed as a reference to value added tax including any similar tax which may be imposed in place thereof from time to time;  

        a "wholly-owned subsidiary" of a company or corporation shall be construed as a reference to any company or corporation which has no other
members except that other company or corporation and that other company's or corporation's wholly-owned subsidiaries or persons acting on behalf of that other company or corporation or its
wholly-owned subsidiaries (save by reason of directors holding qualifying shares which they are or were required by law to hold); and  

        the "winding-up", "dissolution" or "administration" of a company or corporation shall be construed so as to include any
equivalent or analogous proceedings under the laws of the jurisdiction in which such company or corporation is incorporated or any jurisdiction in which such company or corporation carries on business
including the seeking of liquidation, winding-up, reorganisation, dissolution, administration, arrangement, adjustment, protection or relief of debtors and procedures such as suspension of
payments (surseance van betaling) in relation to Dutch Obligors and reprieve from payment (sursis de
paiement), controlled management (gestion contrôlée), general settlement or composition with
creditors (concordat préventif de faillite) in relation to Luxembourg Obligors.  

 Statutes/Time of Day  

        Any reference in this Agreement to: 

        a statute shall be construed as a reference to such statute as the same may have been or may from time to time be, amended or re-enacted; and  

        a time of day shall be construed as a reference to London time.  

 Contracts (Rights of Third Parties) Act 1999  

        Unless expressly provided to the contrary in a Finance Document, a person who is not a party to a Finance Document may not enforce any of
its terms under the Contracts (Rights of Third Parties) Act 1999.

        Notwithstanding any term of any Finance Document, the consent of any third party is not required for any variation (including any release or compromise of any
liability under) or termination of that Finance Document.

Gucci Luxembourg S.A.  

        Notwithstanding that Gucci Luxembourg S.A. is expressed to be a Borrower and Guarantor under this Agreement through its succursale Euro Financial Investments di
Cadempino, its obligations under this Agreement are those of Gucci Luxembourg S.A. as a whole and are not in any way to be construed as being limited to the assets of that branch; relevant references
in the Finance Documents to the Borrowers and Guarantors are accordingly to Gucci Luxembourg S.A. as a whole and not merely its succursale Euro Financial Investments di Cadempino. 

Headings  

        Clause and Schedule headings are for ease of reference only. 

12

 

 
 

The Facilities    
    

Grant of the Facilities  

        The Banks grant to the Borrowers, upon the terms and subject to the conditions hereof:

        a 364-day multicurrency revolving credit facility under which the Banks will make Advances in Euros or Optional Currencies up to an aggregate Euro
Amount not exceeding the Total Facility A Commitments, converting upon exercise of the Term-out Option, to Term Advances; and

        a 3 year multicurrency revolving credit facility under which the Banks will make Advances in Euros or Optional Currencies up to an aggregate Euro Amount
not exceeding the Total Facility B Commitments.

        No Bank is obliged to participate in Facility A Advances in an aggregate Euro Amount exceeding its Facility A Commitment.

        No Bank is obliged to participate in Facility B Advances in an aggregate Euro Amount exceeding its Facility B Commitment.

Purpose and Application  

        The Facilities are intended for general corporate purposes and for refinancing any existing financial indebtedness of the Group and, accordingly, the Borrowers
shall apply all amounts raised by them hereunder for those purposes. None of the Facility Agent, the Mandated Lead Arrangers, the Co-Arrangers or Banks shall be obliged to concern
themselves with such application. 

Condition Precedent Documents  

        Save as the Banks may otherwise agree, no Notice of Drawdown may be delivered hereunder unless the Facility Agent has confirmed to the Borrowers' Agent that
(i) it has received all of the documents listed in Schedule 3 Part 1 (Condition Precedent Documents) and that each is, in form and
substance, satisfactory to the Facility Agent and (ii) each of the Original Guarantors has acceded to this Agreement pursuant to Clause 29.5 (Original
Guarantors). 

Banks' Obligations Several  

        The obligations of each Bank under the Finance Documents are several and the failure by a Bank to perform its obligations under the Finance Documents shall not
affect the obligations of the Borrowers or the Guarantors or any other Bank towards any other party hereto nor shall any other party be liable for the failure by such Bank to perform its obligations
hereunder. 

Banks' Rights Several  

        The amounts outstanding at any time under the Finance Documents from the Obligors to any of the other parties hereto shall be a separate and independent debt, and
except as otherwise stated herein each such party shall be entitled to protect and enforce its individual rights arising out of the Finance Documents independently of any other party, and it shall not
be necessary for any party hereto to be joined as an additional party in any proceedings for such purposes provided that if any Bank commences
proceedings in respect of the Finance Documents it shall notify the Facility Agent as soon as practicable thereafter and the Facility Agent shall notify the other Banks accordingly. 

Term-out Option  

        The Borrowers' Agent may exercise the Term-out Option by submitting a Term-out Notice to the Facility
Agent.

13

 

        A Term-out Notice shall not be valid unless:  

        it is delivered on a business day falling not less than ten days prior to the Facility A Maturity Date;

        the Term-out Date requested is a business day falling:  

        on or before the Facility A Maturity Date;  

        not more than ten, nor less than four, business days after the date on which that Term-out Notice is received by the Facility
Agent; and  

        the Term-out Maturity Date requested is the date falling one year after the Term-out Date or if that is not a
business day, the immediately preceding business day.

        The Term-out Option may only be exercised once and a Term-out Notice is irrevocable.

        If a valid Term-out Notice is delivered, all then outstanding Facility A Advances shall be converted into Term Advances at the close of business on
the Term-out Date (so that those Facility A Advances shall thereupon cease to be Revolving Advances and, on the terms and subject to the conditions of this Agreement, remain outstanding in
the same amount and currency until the Term-out Maturity Date). The first Term of those Term Advances shall be the then current Terms of the outstanding Facility A
Advances.

The Borrowers' Agent  

        Each Obligor irrevocably appoints the Borrowers' Agent to act as its agent under and in connection with the Finance
Documents.

        Each Obligor irrevocably authorises the Borrowers' Agent:  

        to issue Notices of Drawdown (in the case of Borrowers) and to give and receive any other notices on that Obligor's
behalf;

        on its behalf to perform the other duties and exercise the other rights, powers and discretions that are specifically delegated to it under or in connection with
the Finance Documents, together with any other incidental rights, powers and discretions; and

        on its behalf to execute any Finance Document,  

        and agrees to be bound by the acts and acquiescences of, and notices given by, the Borrowers' Agent under the Finance Documents. 

        Each Dutch Obligor which is a Borrower expressly waives its right to invoke the provisions of article 3:68 of the Dutch Civil Code
(Selbsteintritt) in relation to the acts undertaken by the Borrowers' Agent pursuant to this Clause 0.

 
 

Utilisation of the Facilities    
    

Notice of Drawdown  

        A Borrower may borrow an Advance if the Facility Agent receives, no later than 10.00 a.m. on the third business day before the proposed date for the making
of such Advance, a duly completed Notice of Drawdown. 

14

  

Drawdown Details  

        Each Notice of Drawdown delivered to the Facility Agent pursuant to Clause 0 (Notice of Drawdown) shall be
irrevocable and shall not be regarded as having been duly completed unless: 

        it specifies whether it relates to Facility A or Facility B;  

        it identifies the Borrower of the Advance;  

        the proposed date for the making of the Advance requested is a business day falling one month or more before the Facility A Maturity Date
(in the case of Facility A) or the Final Maturity Date (in the case of Facility B) and which shall be at least three business days after the date upon which the previous Advance (if any)
was made hereunder and, if the Advance relates to Facility A, no Term-out Notice has been delivered;

        the currency of denomination of the Advance requested is Euros or an Optional Currency provided that, if the
Borrower selects an Optional Currency (other than Sterling), the Borrower may also select Euros to apply if its first selection becomes ineffective pursuant to Clause 0
(Optional Currency);

        the amount of the Advance requested is a minimum amount of €10,000,000 and an integral multiple of €1,000,000 (or, if the Advance
is to be denominated in an Optional Currency, such comparable and convenient amount thereof as the Facility Agent may from time to time specify) and the Original Euro Amount shall not exceed the
Available Facility A Amount or the Available Facility B Amount (adjusted, in each case and if applicable, to take account of:

any reduction in the relevant Commitment of a Bank scheduled to be made on or prior to the date of drawdown of the proposed Advance; and  

        the Euro Amounts of any relevant Advances which are scheduled to be made or repaid on or prior to the date of drawdown of the proposed
Advance);

        the length of the proposed Term of the Advance requested is specified (in accordance with Clause 0 (Terms of
Advances)) and ends on or before the Facility A Maturity Date (in the case of Facility A) or the Final Maturity Date (in the case of Facility B);
and

        the payment instructions specify an account in the principal financial centre of the relevant currency or, in the case of Euros, in the principal financial centre
of a Participating Member State or London.

Optional Currency  

        If the Borrowers' Agent requests that an Advance be denominated in an Optional Currency (other than Dollars) but, no later than 11.00 a.m. (London time) on
the Quotation Date for such Advance, the Facility Agent notifies the Borrowers' Agent and the Banks that the Facility Agent is of the opinion that, by reason of circumstances affecting the London
interbank market generally, it is not feasible for such Advance to be denominated in such Optional Currency, then, unless the Borrowers' Agent and the Banks otherwise agree, such Advance shall not be
made unless the Borrowers' Agent specified in the Notice of Drawdown in respect of such Advance that in such event such Advance should be denominated in Euros in which case such Advance shall be made
in Euros in an amount equal to the Original Euro Amount relating to such Notice of Drawdown. 

Drawdown Conditions  

        If a Borrower requests an Advance in accordance with the preceding provisions of this Clause 0 (Utilisation of the
Facilities) the Facility Agent shall promptly (and in any event not later than close of business three business days before the proposed date for the making of such Advance)
notify each of 

15

 

the
Banks of the amount of its portion thereof and if, on the proposed date for the making of such Advance: 

        neither of the events mentioned in sub-clauses 0 and 0 of Clause 0 (Market Disruption and Alternative Interest
Rates) shall have occurred;

        the Original Euro Amount of such Advance does not exceed the relevant Available Facility Amount;

        there would not, immediately after the making of such Advance, be more than 15 Advances outstanding in respect of each Facility;

        in the case of a Rollover Advance, no Event of Default has occurred and is continuing or would result from the making of such Rollover Advance and, in the case of
any other Advance no Event of Default or Potential Event of Default has occurred and is continuing or would result from the making of such Advance; and

        the representations set out in Clause 0 (Representations) which are to be repeated pursuant to
Clause 0 (Repetition) are true on and as of the proposed date for the making of such Advance.

        then,
save as otherwise provided herein, such Advance will be made in accordance with the provisions hereof. 

Type of Advance  

        An Advance under Facility B, or outstanding under Facility A prior to the Term-out Date, shall be a Revolving Advance. On and after the
Term-out Date, Facility A Advances shall, in accordance with sub-clause 0 of Clause 0 (Term-out
Option), be Term Advances. 

Each Bank's Participation  

        Each Bank will participate through its Facility Office in each Advance made pursuant to this Clause 0 in the proportion borne by its Available Facility A
Commitment or Available Facility B Commitment (as the case may be), to the relevant Available Facility Amount, immediately prior to the making of that Advance. 

Reduction of available amount  

        If a Bank's relevant Commitment is reduced in accordance with the terms hereof after the Facility Agent has received the Notice of Drawdown for an Advance and
such reduction was not taken into account pursuant to sub-clause 0 of Clause 0 (Drawdown Details), then both the Original Euro
Amount and the actual amount of that Advance shall be reduced accordingly. 

 
 

Payment and Calculation of Interest    
    

Payment of Interest  

        The relevant Borrower shall pay accrued interest on each Advance on its Repayment Date and also, in the case of each Term Advance, on the last day of each Term of
that Advance (including that current on the Term-out Date). 

Terms of Advances  

        The Term for an Advance shall be selected in the relevant Notice of Drawdown or, in the case of a Term Loan which is outstanding, by the
Borrowers' Agent giving notice to the Facility Agent not later than 11.00 a.m. three business days prior to the start of that Term. Subject to the following provisions of this Clause 0,
each Term will be of the duration so selected.

16

 

Each Term shall be of a duration of one, two, three or six months.  

        If the Borrowers' Agent fails to select a Term for a Term Advance which is outstanding, that Term will, subject to the other provisions of
this Clause 0, be of a duration of three months.

Calculation of Interest  

        The rate of interest applicable to an Advance from time to time during its Term shall be the rate per annum determined by the Facility
Agent to be the aggregate of the applicable Margin and LIBOR.

        In addition to interest under sub-clause 0, the Borrowers shall also pay to the Facility Agent for each Bank together with each relevant
payment of interest that Bank's Mandatory Cost (in the case of paragraph (b) of the definition of Mandatory Cost, as notified by the Bank to the Facility Agent at least ten business days prior
to the end of the relevant Term).

 
 

Market Disruption and Alternative Interest Rates    
    

Substitute basis  

        If, in relation to any Advance: 

        the Facility Agent determines that at or about 11.00 a.m. (London time) on the Quotation Date for a Term in respect of such Advance (in the case of Euros
or an Optional Currency) it is unable to access the Telerate screen or the rate does not appear on the relevant page of the Telerate screen and none or only one of the Reference Banks was offering to
prime banks in the London interbank market deposits in the currency in which such Advance is to be denominated and for the specified period; or

        before the close of business in London on the Quotation Date for such Term the Facility Agent has been notified by a Bank or each of a group of Banks to whom in
aggregate 45 per cent. or more of such Advance if made would be owed that LIBOR as determined by the Facility Agent does not accurately reflect the cost to it of obtaining such
deposits,

        then,
notwithstanding the provisions of Clause 0 (Payment and Calculation of Interest): 

        the Facility Agent shall notify the other parties hereto of such event and that this Clause 0 is in operation;

        if such an Advance has not been made:  

        if it is to be denominated in Euros or Dollars the Advance will be made notwithstanding the Facility Agent's notification (and
Clause 0 (Alternative Basis) shall apply to it); or

        if it is to be denominated in any other currency, the Advance shall not be made; and  

        in the case of sub-clause 0, within five days of such notification the Facility Agent and the Borrowers' Agent shall
enter into negotiations for a period of not more than 30 days with a view to agreeing a substitute basis for determining the rates of interest which may be applicable to Advances in the
relevant currency in the future and any such substitute basis that is agreed shall take effect in accordance with its terms and be binding on each party hereto provided that  the Facility Agent may not
agree any such substitute basis without the prior consent of each Bank.
 

Alternative basis  

        If a notification under sub-clause 0 applies to a Revolving Advance denominated in Euros or Dollars or to a Term Advance which is outstanding
in any currency, then, for the purpose of calculating the rate of interest on that Advance pursuant to Clause 0 (Payment and Calculation of
Interest): 

        within five days of the notification, the Borrowers' Agent and the Facility Agent shall enter into negotiations for a period of not more than 30 days with
a view to agreeing an alternative basis for  

17

 

 determining the rate of interest and/or funding applicable to that Advance and/or any other Advance denominated in the currency of that Advance;

        any alternative basis agreed under sub-clause 0 above shall, with the prior consent of all the Banks, be binding on all the parties
hereto;

        if no alternative basis is agreed, each Bank shall (through the Facility Agent) certify on or before the last day of the Term to which the notification relates an
alternative basis for maintaining its participation in that Advance and/or any other Term Advances denominated in the currency of that Term Advance and/or Revolving Advances denominated in Euros or
Dollars (as applicable);

        any such alternative basis may include an alternative method of fixing the interest rate, alternative Terms or alternative currencies but it must reflect the cost
to the Bank of funding its participation in the relevant Advance from whatever sources it may select plus the appropriate Margin plus any applicable Mandatory Cost; and

        each alternative basis so certified shall be binding on the Obligors and the certifying Bank and treated as part of this Agreement.

 
 

Repayment    
    

Repayment  

        Each Borrower shall repay each Revolving Advance made to it in full on the Repayment Date relating thereto provided that, for the
avoidance of doubt, Clause 0 (Payments by the Facility Agent) shall apply such that, if on the same day the relevant Borrower is drawing an
Advance, the proceeds of such new Advance, if made in accordance with the provisions hereof, shall first be applied by the Facility Agent in or towards payment of the Advance due to be repaid on that
day or towards the purchase of any currency to be so applied.

        Each Borrower shall repay each Term Advance made to it in full on the Term-out Maturity Date.

No Other Repayments  

        The Borrowers shall not repay all or any part of any Advance outstanding hereunder except at the times and in the manner expressly provided herein. 

 
 

Cancellation and Prepayment    
    

Voluntary Cancellation  

        The Borrowers' Agent may, by giving to the Facility Agent not less than ten business days' prior notice to that effect, cancel the whole or any part (being a
minimum amount of €10,000,000 and an integral multiple of €1,000,000) of the Available Total Facility A Commitments or of the Available Total Facility B Commitments (or
both) and any such cancellation shall reduce the relevant Commitment(s) of each Bank rateably. 

Automatic Cancellation  

        The Total Facility A Commitments shall, to the extent not previously voluntarily cancelled under Clause 0 and subject to
sub-clause 0, be automatically cancelled in full on the Facility A Maturity Date.

        The amount of the Total Facility A Commitments undrawn on the Term-out Date, shall be automatically cancelled on that date.

        The Total Facility B Commitments shall, to the extent not previously voluntarily cancelled under Clause 0, be automatically cancelled in full on the Final
Maturity Date.

18

 

Prepayment  

        Subject to Clause 0 (Broken Periods), the Borrowers' Agent may, by giving to the Agent not less than ten
business days' prior notice to that effect, prepay the whole or any part of an Advance (being a minimum amount of €10,000,000 and an integral multiple of €1,000,000
(or, if the Advance is denominated in an Optional Currency, such comparable and convenient amount thereof as the Facility Agent shall specify) together with any accrued interest and any other amounts
due to the Facility Agent, the Mandated Lead Arrangers, the Co-Arrangers and the Banks in respect thereof under this Agreement. 

Notice of Cancellation or Prepayment  

        Any notice of cancellation or prepayment given by the Borrowers' Agent pursuant to Clause 0 (Voluntary
Cancellation) or Clause 0 (Prepayment), as the case may be, shall be irrevocable and shall specify the date upon which
such voluntary cancellation or prepayment is to be made and the amount of such cancellation or prepayment. 

Prepayment of a Bank's Share of the Loan  

        If any Bank claims indemnification from any Borrower under Clause 0 (Tax Indemnity) or Clause 0
(Increased Costs) or any Borrower is required to make any increased payments under Clause 0 (Tax
Gross-up) or interest on a Bank's portion of an Advance is certified under sub-clause 0 of Clause 0 (Alternative
basis) (and is higher than that for other Banks except those to which this Clause 0 is being applied) the Borrowers' Agent may, within 30 days thereafter and by
not less than ten business days' prior notice to the Facility Agent (which notice shall be irrevocable), (a) cancel such Bank's Commitment(s) whereupon such Bank shall cease to be obliged to
participate in further Advances and its Commitment(s) shall be reduced to zero and/or (b) subject to Clause 0 (Broken Periods), require
the Borrowers to prepay such Bank's portion of the Advances outstanding at such time and provided that any prepayment made pursuant to this
Clause 0 shall be either applied immediately and be subject to Clause 0 (Broken Periods) or be held by the Facility Agent and continue to
accrue interest in accordance with the terms hereof and, on the last day of the then current Term(s), be applied in repayment of the relevant Advances. 

Change of Control  

        If at any time after the date hereof any person (other than Pinault-Printemps-Redoute S.A. ("PPR") or a subsidiary
of PPR which satisfies the tests in both of paragraphs (a) and (b) of the definition of "subsidiary" in Clause 0
(Interpretation)) acquires or is to acquire the direct or indirect beneficial ownership of more than 50 per cent. of the voting rights in the Parent,
promptly upon becoming aware thereof, the Parent shall give the Facility Agent written notice thereof and, within 30 days of receipt of such notice by the Facility Agent, any Bank which does
not consent thereto shall have the right by delivery to the Facility Agent of a notice, which notice the Facility Agent shall promptly send to the Parent, (i) to cancel the Commitment(s) of
such Bank, whereupon such Bank shall cease to be obliged to participate in further Advances and its Commitment(s) shall be reduced to zero and/or (ii) subject to Clause 0
(Broken Periods), to require the Borrowers to, prepay such Bank's portion of the Advances outstanding at such time provided
that if within 15 business days of delivery of such notice to the Parent, such prepayment shall not have been made, an Event of Default shall be deemed to have occurred and
provided further that any prepayment made pursuant to this Clause 0 shall be either applied immediately and be subject to Clause 0 (Broken
Periods) or be held by the Facility Agent and continue to accrue interest in accordance with the terms hereof and, on the last day of the then current Term(s), be applied in
repayment of the relevant Advances. 

19

 

 
 

Taxes    
    

Tax Gross-up  

        All payments to be made by any of the Obligors to any person under the Finance Documents shall be made free and clear of and without deduction for or on account
of tax unless such Obligor is required to make such a payment subject to the deduction or withholding of tax, in which case the sum payable by such Obligor in respect of which such deduction or
withholding is required to be made shall be increased to the extent necessary to ensure that, after the making of the required deduction or withholding, such person receives and retains (free from any
liability in respect of any such deduction or withholding) a net sum equal to the sum which it would have received and so retained had no such deduction or withholding been made or required to be made  provided
that the relevant Obligor will not be obliged to increase any payment under this Clause 0 to any Bank not being or ceasing to be a
Qualifying Bank unless (i) the requirement to deduct or withhold would have applied had such Bank been or continued to be a Qualifying Bank (in which case the amount payable will not exceed the
amount which would have been payable to a Qualifying Bank) or (ii) such Bank is not or ceases to be a Qualifying Bank as a result of a change of law or application of a double taxation treaty
or generally applied practice of the relevant tax authorities required to make such deduction or withholding. 

Tax Indemnity  

        Without prejudice to the provisions of Clause 0 (Tax Gross-Up), if any person or the Facility
Agent on its behalf is required to make any payment on account of tax (not being either (a) a tax imposed on and calculated by reference to the net income paid to and received by its Facility
Office, or (b) Italian imposta regionale sulle attivitá produttive) or otherwise on or in relation to any sum received or
receivable under the Finance Documents by such person or the Facility Agent on its behalf (including any sum received or receivable under this Clause 0) or any liability in respect of any such
payment is imposed, levied or assessed against such person or the Facility Agent on its behalf, the relevant Obligor shall, upon demand of the Facility Agent, promptly indemnify such person against
such payment or liability, together with any interest, penalties, reasonable costs and expenses payable or incurred in connection therewith other than if such payment was made or liability was
incurred as a result of the relevant person's wilful misconduct or gross negligence. 

Banks' Tax Status Confirmation  

        Each Bank confirms in favour of the Facility Agent (on the date hereof or, in the case of a Bank which becomes a party hereto pursuant to a transfer or
assignment, on the date on which the relevant transfer or assignment becomes effective) that either: 

        it is not resident for tax purposes in the United Kingdom and is beneficially entitled to its share of the Loan and the interest thereon; or  

        it is a bank as defined for the purposes of Section 840A of the Income and Corporation Taxes Act 1988 and is beneficially entitled
to its share of the Loan and the interest thereon,

        and
each Bank shall promptly notify the Facility Agent if there is any change in its position from that set out above. 

Claims by Banks  

        A Bank intending to make a claim pursuant to Clause 0 (Tax Indemnity) shall notify the Facility Agent
promptly after becoming aware thereof, of the event by reason of which it is entitled to do so, whereupon the Facility Agent shall notify the Parent thereof provided
that nothing herein shall require such Bank to disclose any information regarding its tax affairs or computations or the organisation of its affairs generally. 

20

 

 
 

Tax Receipts    
    

Notification of Requirement to Deduct Tax  

        If, at any time, any of the Obligors is required by law to make any deduction or withholding from any sum payable by it hereunder (or if thereafter there is any
change in the rates at which or the manner in which such deductions or withholding are calculated), the Parent shall, promptly upon becoming aware thereof, notify the Facility Agent. 

Evidence of Payment of Tax  

        If any of the Obligors makes any payment hereunder in respect of which it is required to make any deduction or withholding, it shall pay the full amount required
to be deducted or withheld to the relevant taxation or other authority within the time allowed for such payment under applicable law and the Parent shall deliver to the Facility Agent for each
relevant Bank, within 30 days or as soon as practicable after the relevant Obligor has made such payment to the applicable authority, an original receipt (or a certified copy thereof) issued by
such authority evidencing the payment to such authority of all amounts so required to be deducted or withheld in respect of that Bank's share of such payment. Should the relevant Obligor be entitled
to issue such certificate or receipt, the Parent shall deliver it to the Facility Agent for each relevant Bank promptly after the date of the applied withholding or deduction. 

Tax Credits  

        If, following any increase in any sum payable under this Agreement under Clause 0 (Tax
Gross-up) or any payment under Clause 0 (Tax Indemnity), any Bank or the Facility Agent shall receive or be
granted a credit against or remission for any tax payable by it, that Bank shall promptly notify the Facility Agent and the Facility Agent shall promptly notify the Parent thereof and shall, subject
to an Obligor having made any increased payment in accordance with Clause 0 (Tax Gross-up) or payment in accordance with
Clause 0 (Tax Indemnity) and to the extent that such Bank or the Facility Agent can do so in its sole opinion (acting in good faith) without
prejudicing the retention of the amount of such credit or remission and without prejudicing its right to obtain any other relief or allowance which may be available to it and to conduct its own tax
affairs as it thinks fit, reimburse such amount as that Bank or the Facility Agent shall in its discretion (acting reasonably and in good faith) certify to be the proportion of such credit or
remission as will leave that Bank or the Facility Agent (after such reimbursement) in no worse position than it would have been in had no increase been required under Clause 0
(Tax Gross-up) or payment been required under Clause 0 (Tax Indemnity). 

Banks' tax affairs  

        Nothing contained in this Agreement or any of the Finance Documents shall oblige any Bank or the Facility Agent to rearrange its tax affairs or to disclose any
information regarding its tax affairs or computations or the organisation of its affairs generally. 

 
 

Changes in Circumstances    
    

Increased Costs  

        If, by reason of: 

        any change in law or in its interpretation or administration; and/or  

21

 

        compliance with any Capital Adequacy Requirement or any other request from or requirement of any central bank or other fiscal, monetary or
other authority not existing on the date hereof and other than:

        one with which banks in the jurisdiction of incorporation of the relevant Bank do not ordinarily comply;

        a tax imposed on and calculated by reference to the net income paid to and received by such Bank's Facility Office; or  

        to the extent the relevant Bank has been indemnified by the relevant Borrower in accordance with Clause 0
(Tax Gross-up) or Clause 0 (Tax Indemnity) in respect
thereof,

        a Bank or any holding company of such Bank is unable to obtain the rate of return on its capital which it would have been able to obtain but for such Bank's
entering into or assuming or maintaining a commitment or performing its obligations (including its obligation to participate in the making of Advances or any of them) under this Agreement;
or

        a Bank or any holding company of such Bank incurs a cost as a result of such Bank's entering into or assuming or maintaining a commitment or performing its
obligations (including its obligation to participate in the making of Advances or any of them) under this Agreement; or

        there is any increase in the cost to a Bank or any holding company of such Bank of funding or maintaining all or any of the loans comprised in a class of loans
formed by or including such Bank's share of the Advances or any of them; or

        a Bank or any holding company of such Bank becomes liable to make any payment on account of tax or otherwise on or calculated by reference to the amount of such
Bank's share of the Advances (or any of them) and/or to any sum received or receivable by it hereunder,

        (in
any such case to the extent not adequately compensated for by the payment of Mandatory Cost) each Borrower shall, from time to time on demand of the Facility Agent, promptly pay to
the Facility Agent for the account of that Bank amounts sufficient to hold harmless and indemnify that Bank or such Bank's holding company from and against, as the case may be, (l) such
reduction in the rate of return on capital, (2) such cost, (3) such increased cost (or such proportion of such increased cost as is, in the reasonable opinion of that Bank, attributable
to its participating in the funding or maintaining of Advances or the relevant Advances), or (4) such liability. 

Increased Costs Claims  

        A Bank intending to make a claim pursuant to Clause 0 (Increased Costs) shall notify the Facility Agent,
promptly upon becoming aware thereof, of the event by reason of which it is entitled to do so, providing reasonably detailed calculations (to the extent possible), whereupon the Facility Agent shall
notify the Borrowers' Agent thereof provided that nothing herein shall require such Bank to disclose any confidential information relating to tax
matters or the organisation of its affairs. 

Illegality  

        If, at any time, it is unlawful for a Bank to make, fund or allow to remain outstanding all or part of its share of the Advances or to maintain its Commitment(s),
then that Bank shall, promptly after becoming aware of the same, deliver to the Borrowers' Agent through the Facility Agent a notice to that effect and: 

        such Bank shall not thereafter be obliged to participate in the making of any Advances and its Commitment(s) shall be immediately reduced to zero; and  

22

 

        if the Facility Agent on behalf of such Bank so requires, each Borrower shall on the latest date permitted by law repay such Bank's share
of the outstanding Advances together with accrued interest thereon and all other amounts owing to such Bank hereunder.

Mitigation  

        If circumstances are such that (a) a Bank intends to claim indemnification from any Borrower under Clause 0 (Tax
Indemnity) or Clause 0 (Increased Costs) or (b) any Borrower will be obliged to increase payments to any person
hereunder pursuant to Clause 0 (Tax Gross-up) or (c) it becomes unlawful for a Bank to make, fund or allow to remain
outstanding all or part of its share of the Advances or to maintain its Commitment(s), such Bank shall, after consultation with the Facility Agent and the Borrowers' Agent and to the extent that it
can do so lawfully and without prejudice to its own position, take such steps which it might reasonably take (including a change in its Facility Office or the transfer of its rights, benefits and
obligations hereunder to another financial institution acceptable to the Borrowers' Agent and willing to participate in the Facilities) with a view to mitigating the effect of such circumstances on
the relevant Borrower. The Borrowers' Agent and the Facility Agent shall consult with a view to finding another bank which is willing to participate in the Facilities in the place of the relevant
Bank, provided that no Bank shall be under an obligation to make any transfer or assignment and transfer if, in its reasonable opinion, it would or
might have an adverse effect upon its business, operations or financial condition (loss of profit under this Agreement not being adverse for these purposes) or the management of its tax affairs. 

 
 

Representations    
    

	(ii)
	The
Parent on behalf of itself, the Group and on behalf of Guccio Gucci S.p.A. makes the representations and warranties set out in Clause 0 (Status and
Due Authorisation) to Clause 0 (Investment Company Act) (except for, in respect of Guccio Gucci S.p.A., Clause 0
(No deductions or Withholding) and Clauses 0 (No Obligation to Create Security) to 0
(Private and Commercial Acts));

	(jj)
	Each
of the other Obligors makes the representations and warranties set out in Clauses 0 (Status and Due Authorisation) and Clauses 0
(Claims Pari Passu) to 0 (Investment Company Act) on behalf of itself; and

	(kk)
	Each
Borrower makes the representation and warranty set out in Clause 0 (No Deductions or Withholding); and

	(ll)
	Each
of the US Obligors makes the representation and warranty set out in Clause 0 (Solvency), 

and
acknowledges that the Finance Parties have entered into this Agreement in reliance on those representations and warranties. 

Status and Due Authorisation  

        It is a corporation duly organised and validly existing under the laws of its jurisdiction of incorporation with power to enter into this Agreement and to
exercise its rights and perform its obligations hereunder and all corporate and other action required to authorise its execution of this Agreement and its performance of its obligations hereunder has
been duly taken. 

No Deductions or Withholding  

        Under the laws of its jurisdiction of incorporation in force at the date hereof it will not be required to make any deduction or withholding from any payment it
may make hereunder to a Qualifying Bank. 

23

 

Claims Pari Passu  

        Under the laws of its jurisdiction of incorporation in force at the date hereof, the claims of the Facility Agent, the Mandated Lead Arrangers, the
Co-Arrangers and the Banks against it under the Finance Documents will rank at least pari passu with the claims of all its other unsecured
creditors save those whose claims are preferred solely by any bankruptcy, insolvency, liquidation or other similar laws of general application. 

Governing Law and Judgments  

        Subject to the qualifications set out in the relevant legal opinions delivered pursuant to Clause 0 (Condition Precedent
Documents) reflecting the law in force on the date hereof, in any proceedings taken in its jurisdiction of incorporation in relation to this Agreement, the choice of English
law as the governing law of this Agreement and any judgment obtained in England or New York will be recognised and enforced. 

Validity and Admissibility in Evidence  

        Subject to the qualifications set out in the relevant legal opinions delivered pursuant to Clause 0 (Condition Precedent
Documents) reflecting the law in force on the date hereof, all acts, conditions and things required to be done, fulfilled and performed in order (a) to enable it
lawfully to enter into, exercise its rights under and perform and comply with the obligations expressed to be assumed by it in this Agreement, (b) to ensure that the obligations expressed to be
assumed by it in this Agreement are legal, valid, binding and enforceable and (c) to make this Agreement admissible in evidence in its jurisdiction of incorporation, have been done, fulfilled
and performed. 

No Filing or Stamp Taxes  

        Under the laws of its jurisdiction of incorporation in force at the date hereof, it is not necessary that this Agreement be filed, recorded or enrolled with any
court or other authority in such jurisdiction or that any stamp, registration or similar tax be paid on or in relation to this Agreement. 

Binding Obligations  

        Subject to the qualifications set out in the relevant legal opinions delivered pursuant to Clause 0 (Condition Precedent
Documents) reflecting the law in force on the date hereof, the obligations expressed to be assumed by it in this Agreement are legal and valid obligations binding and
enforceable on it in accordance with the terms hereof. 

No Winding-up  

        No Material Company has taken any corporate action nor have any other steps been taken or legal proceedings been started or (to the best of its knowledge and
belief) threatened against any Material Company for its winding-up, dissolution, administration or re-organisation or for the appointment of a receiver, administrator,
administrative receiver, trustee or similar officer of it or of any or all of its assets or revenues under any applicable insolvency or similar law. 

No Material Defaults  

        As far as it is aware, having made due enquiry, no member of the Group is in breach of or in default under any agreement to which it is a party or which is
binding on it or any of its assets to an extent or in a manner which would be reasonably likely to have a material adverse effect on the business or financial condition of any Obligor or the Group
taken as a whole. 

24

 

No Material Proceedings  

        No action or administrative proceedings of or before any court or agency which would be reasonably likely to have a material adverse effect on the business or
financial condition of any of the Obligors or the Group taken as a whole or which purports to affect the legality, validity, binding effect or enforceability hereof has been started or, so far as it
is aware, having made due enquiry, threatened. 

Original Financial Statements  

        The Original Financial Statements were prepared in accordance with international accounting standards consistently applied (or, if not consistently applied, with
a reasonably detailed description of any changes in the notes thereto) and give (in conjunction with the notes thereto) a true and fair view of the financial condition of the Group at the date as of
which they were prepared and the results of the Group's operations during the financial year then ended. 

No Material Adverse Change  

        Since the date to which the most recent financial statements of the Group refer, there has been no change in the business or financial condition of any Obligor or
of the Group taken as a whole which is reasonably likely to materially adversely affect the ability of the Obligors to perform their obligations hereunder. 

No Undisclosed Liabilities  

        No member of the Group had, as at the date as of which the Original Financial Statements were prepared, any liabilities (contingent or otherwise) which were not
disclosed thereby (or by the notes thereto) or reserved against therein (other than liabilities which were not material) nor were there at that date any unrealised or anticipated losses of any member
of the Group arising from commitments entered into by it which were not so disclosed or reserved against (other than losses which were not material). 

Full Disclosure  

        To the best of its knowledge and belief, having made due enquiry, the information (other than the forecasts and projections (if any)) contained in the Information
Memorandum and all of the other written information supplied by any member of the Group to the Facility Agent, the Mandated Lead Arrangers, the Co-Arrangers and the Banks in connection
herewith is true, complete and accurate in all material respects and it is not aware of any material facts or circumstances that have not been disclosed to the Facility Agent, the Mandated Lead
Arrangers, the Co-Arrangers and the Banks and which, if disclosed, would be reasonably likely to adversely affect the decision of a person considering whether or not to provide finance to
the Borrowers or to provide such finance against the security of guarantees issued by the Guarantors. 

Encumbrances  

        No encumbrance (other than a Permitted Encumbrance) exists over all or any of the present or future revenues or assets of any member of the Group. 

No Obligation to Create Security  

        Its execution of this Agreement and its exercise of its rights and performance of its obligations hereunder will not result in the existence of nor oblige any
member of the Group to create any encumbrance over all or any of its present or future revenues or assets. 

25

 

Execution of this Agreement  

        Its execution of this Agreement and its exercise of its rights and performance of its obligations hereunder do not and will not: 

        conflict in any material way with any agreement, mortgage, bond or other instrument or treaty to which it is a party or which is binding upon it or any of its
assets;

        conflict with its constitutive documents and corporate rules and regulations; or  

        conflict with any applicable law, regulation or official or judicial order.  

 Private and Commercial Acts  

        Its execution of this Agreement constitutes, and its exercise of its rights and performance of its obligations hereunder will constitute, private and commercial
acts done and performed for private and commercial purposes. 

Ownership of the Obligors  

        Each of the Obligors and Guccio Gucci S.p.A. (other than the Parent) is a wholly-owned subsidiary of the Parent. 

Material Intellectual Property  

        Except in relation to matters as to which the non-pursuit of remedies is permitted under Clause 0 (Material
Intellectual Property), each member of the Group has good legal title to its respective Material Intellectual Property. 

ERISA  

        Each Plan of the Obligors and their respective ERISA Affiliates complies in all material respects with ERISA and all other applicable laws and regulations. No
Reportable Event has occurred with respect to any Plan, and no steps have been taken to terminate any Plan which could reasonably be expected to have a material adverse effect on the business or
financial condition of any Obligor or the Group taken as a whole. No Obligor or any subsidiary of an Obligor or ERISA Affiliate of an Obligor has had a complete or partial withdrawal from any
Multiemployer Plan or initiated any steps to do so within the six year period preceding the date of this Agreement. No accumulated funding deficiency (as defined in sub-clause 0 of
Clause 0 (ERISA)) has occurred during the six year period preceding the date on which this representation is made or deemed made with respect to
any Plan, and no lien in favour of the United States Pension Benefit Guaranty Corporation or a Plan has arisen during such six year period. 

26

  

Anti-Terrorism Laws  

        None of the Obligors or, to the knowledge of any of the Obligors, any of their affiliates, is in violation of any laws relating to
terrorism or money laundering applicable to them ("Anti-Terrorism Laws"), including Executive Order No. 13224 on Terrorist Financing, effective September 24, 2001 (the
"Executive Order"), and the Uniting and Strengthening America by Providing Appropriate Tools Required to Intercept and Obstruct Terrorism Act of 2001, Public Law 107-56.  

 Investment Company Act  

        No Obligor is an "investment company" or a company "controlled" by
an "investment company", within the meaning of the United States Investment Company Act of 1940, as amended. 

Solvency  

        The sum of each US Obligor's debts (including its obligations under this Agreement) is less than the value of its property (calculated at
the lesser of fair valuation and present fair saleable value).

        The capital of each US Obligor is not unreasonably small to conduct its business as currently conducted or as proposed to be conducted.

        No US Obligor has incurred and does not intend to incur or believe it will incur debts beyond its ability to pay as they mature.

        No US Obligor has made a transfer or incurred any obligation under this Agreement with the intent to hinder or delay payment to, or to defraud, any of its present
or future creditors.

For purposes of this Clause:  

        "debt" means any liability on a claim;

        "claim" means (1) any right to payment, whether or not that right is reduced to judgment, liquidated,
unliquidated, fixed, contingent, matured, unmatured, disputed, undisputed, legal, equitable, secured or unsecured, or (2) any right to an equitable remedy for breach of performance if that
breach gives rise to payment, whether or not the right to an equitable remedy is reduced to judgment, fixed, contingent, matured, unmatured, disputed, undisputed, secured or unsecured;
and

        terms used in this Clause 0 shall be construed in accordance with the applicable United States bankruptcy and state fraudulent conveyance statutes and the
related case law.

Repetition  

        Each of the representations and warranties contained in this Clause 0 (except for Clause 0 (No Deductions or
Withholding), Clause 0 (Claims Pari Passu), Clause 0 (No Filing or Stamp
Taxes), Clause 0 (No Material Proceedings) and Clause 0 (Full
Disclosure) to the extent that this relates to the Information Memorandum and Clause 0 (Ownership of the Obligors)) shall
be deemed to be repeated by each of the Obligors at the beginning of each Term, on the date on which a Term-out Notice is given, and on the Term-out Date, in each case by
reference to the facts and circumstances then existing provided that (following delivery of any statements under Clause 0
(Annual Statements)) references to the Original Financial Statements shall be construed as references to the most recently delivered annual consolidated
financial statements of the Group. 

27

 

 
 

Financial Information    
    

Annual Statements  

        Each of the Obligors shall as soon as the same become available, but in any event within 210 days after the end of each of its financial years, deliver to
the Facility Agent in sufficient copies for the Banks such financial statements as it is required by the laws of its jurisdiction of incorporation to prepare (or, in the case of the Parent, the
consolidated financial statements of the Group) for such financial year. 

Semi-annual Statements  

        The Parent shall as soon as the same become available, but in any event within 150 days after the end of each half of each of its financial years, deliver
to the Facility Agent in sufficient copies for the Banks the consolidated financial statements of the Group for such period. 

Other Financial Information  

        Each of the Obligors shall from time to time on the request of the Facility Agent, furnish the Facility Agent with such information about the business and
financial condition of the Group as the Facility Agent (or any Bank through the Facility Agent) may reasonably require (taking confidentiality restrictions into account) and shall furnish the Facility
Agent as soon as practicable and in any event within five business days of issue with copies of all press releases issued by the Parent or on behalf of the Group relating to financial matters
including, without limitation, its quarterly financial press releases. 

Requirements as to Financial Statements  

        Each of the Obligors shall ensure that: 

        each set of financial statements delivered by it pursuant to this Clause 0 has been certified by the chief executive officer or chief financial officer of
such Obligor as giving a true and fair view of its financial condition (or, in the case of financial statements of the Parent, the financial condition of the Group) as at the end of the period to
which those financial statements relate and of the results of its (or, as the case may be, the Group's) operations during such period;

        each set of annual financial statements delivered by the Parent (and each other Obligor, if the law of the jurisdiction of incorporation of the relevant Obligor
so requires (and for the avoidance of doubt under current Italian law Guccio Gucci S.p.A., Luxury Goods Italia S.p.A., Gucci Finanziaria S.p.A. and Gucci Logistica S.p.A. are not so required))
pursuant to Clause 0 (Annual Statements) has been audited by auditors of international repute; and

        each set of consolidated financial statements delivered by it pursuant to Clause 0 (Annual Statements) or 0
(Semi-Annual Statements) shall be reviewed by auditors of international repute and accompanied by a compliance certificate substantially in
the form of Schedule 7 (Form of Compliance Certificate) issued by the chief financial officer of the Parent certifying:

whether or not the financial covenants in Clause 0 (Financial Condition) have been observed, supported by reasonably
detailed calculations; and  

        compliance with sub-clause 0 of Clause 0 (Additional Guarantors)
as at the date to which the relevant financial statements are made up or, failing such compliance as at that date, specifying the members of the Group which are to become additional Guarantors or in
respect of whose shares pledges will be given in accordance with sub-clauses 0 and 0.

28

 

Accounting Policies  

        Each of the Obligors shall ensure that each set of financial statements delivered to the Facility Agent pursuant to Clause 0
(Annual Statements) or 0 (Semi-annual Statements) is prepared using accounting policies,
practices, procedures and reference periods, (in the case of the consolidated financial statements of the Group) (or, in the case of unconsolidated financial statements, to the extent those policies,
practices and procedures are applicable in the context of any particular set of unconsolidated financial statements), consistent with those applied in the preparation of the Original Financial
Statements unless, in relation to any such set of financial statements, the Parent notifies the Facility Agent that there have been one or more changes in any such accounting policies, practices,
procedures or reference periods in a way which materially affects the financial covenants contained in Clause 0 (Financial Condition) (the change
to be deemed to be material for this purpose if it would result in a breach or the prevention of a breach of any such financial covenant to be tested on the basis of those financial statements, or if
it might reasonably be expected to have either such result in relation to any future test of such financial covenants) in which event:

        the Facility Agent acting on the instructions of an Instructing Group and the Parent shall, at the Facility Agent's request, negotiate in good faith with a view
to agreeing such amendments to the financial covenants in Clause 0 (Financial Condition) and/or the definitions used therein as may be necessary
to grant to the Banks protection comparable to that granted on the date hereof, and any amendments so agreed will have effect on the date agreed between the Facility Agent and the Parent;
and

        if no such agreement is reached within 30 days of the Facility Agent's request, the Parent shall (if so requested by the Facility Agent acting upon the
instructions of an Instructing Group) prepare a reconciliation statement certified by the chief financial officer of the Parent as true and accurate containing restated figures to the extent necessary
to demonstrate compliance with Clause 0 (Financial Condition) and a description of such changes and adjustments which would be required to be
made to such financial statements so that such financial statements reflected the basis upon which the Original Financial Statements were prepared before the changes were made.

Notwithstanding sub-clause 0 above:  

        each set of financial statements delivered to the Facility Agent pursuant to Clause 0 (Annual
Statements) in respect of an Obligor other than the Parent shall be prepared using accounting policies, practices and procedures generally accepted in the relevant Obligor's
country of incorporation, consistently applied; and

        in respect of additional Borrowers and Guarantors, if their relevant financial statements are not prepared in accordance with the accounting policies, practices
and procedures used in preparation of
the Original Financial Statements, they shall be prepared using accounting policies, practices and procedures generally accepted in their respective countries of incorporation, consistently
applied.

 
 

Financial Condition    
    

Financial Condition of the Group  

        At all times, the consolidated financial condition of the Group, as evidenced by the most recent financial statements prepared in
accordance with the provisions of Clause 0 (Accounting Policies) (notionally updated to reflect any changes which might have occurred since the
date such financial statements refer to the extent required to calculate the financial covenants set out at sub-paragraphs 00 and 00 below), shall be such that:

        the ratio of Net Financial Indebtedness to Net Worth shall not at any time be greater than 1:1; and  

29

 

        the ratio of Net Financial Indebtedness to EBITDA on a Rolling Basis, shall not at any time be greater than 3:1.

        At all times, the financial condition of the Group, calculated on a Rolling Basis, shall be such that the ratio of EBITDA to Net Financial Payments shall not be
less than 4:1.

Definitions of Financial Terms  

        In this Agreement: 

        "Approved Funds" means investment funds which hold money market instruments and/or marketable securities rated at least A-2 or BBB (as the case may
be) by Standard & Poor's Corporation or P-2 or Baa2 (as the case may be) by Moody's Investors Service, Inc., which funds are not themselves so rated, but which are managed by
financial institutions whose long term unsecured, unsubordinated debt rating is at least BBB by Standard & Poor's Corporation or Baa2 by Moody's Investors Service Inc;  

        "Asset Value" means, at any time in relation to a member of the Group or the Group, as the case may be, the book value of the assets of
such Group member as shown in the most recent consolidated financial statements of the relevant member of the Group or the Group, as the case may be, provided hereunder.  

        "EBIT" means in relation to a member of the Group or the Group, as the case may be, the net income of such Group member or the
consolidated net income of the Group, as the case may be, before:

        any expense or income on account of income taxes and deferred taxation;  

        any interest, commissions, discounts and other fees incurred by such Group member or by the Group, as the case may be, in respect of
financial indebtedness as well as the interest component included within the amount of any rent due under leases which in accordance with IFRS/IAS are classified and accounted for as financial leases
in the financial statements of the relevant member of the Group;

        any interest or comparable income whether in respect of investments of the kinds referred to in sub-paragraphs (ii), (iii) or (iv) of
the definition of "Net Financial Indebtedness", or otherwise earned by such Group member or by the Group, as the case may be;

        charges or credits in respect of minority interests;  

        gains and losses arising from the disposal of financial assets as well as the change in fair value of financial assets classified in the
category "Held for trading" under IFRS/IAS,  

        and excluding income and expenses arising from extraordinary items. For the purposes of this definition "extraordinary
items" means transactions not undertaken in the normal course of business and will include, amongst others, the income or expenses resulting from the restructuring of a
business acquired and the income or expenses arising from the disposal and or termination of a business. 

        "EBITDA" means EBIT before depreciation and amortisation of the relevant Group member or the Group, as the case may be;  

        "Financial Half-Year" means each of those periods of approximately six calendar months in any financial year of the Group
ending on any Half-Year Date;  

        "Half-Year Date" means each of 31st July and 31st January;

        "Net Financial Indebtedness" means financial indebtedness less (without double counting) to the extent free of restrictions on withdrawal arising by reason of an
encumbrance (i) cash in hand and at  

30

 

 bank (not including any cash collateral which fully secures indebtedness in an amount equal to or greater than the amount of such indebtedness); (ii) the net amounts due to members of the Group
under hedging contracts (calculated on a mark-to-market basis); (iii) the market value of all liquid money market instruments and marketable securities rated at least
A-2 or BBB (as the case may be) by Standard & Poor's Corporation or P-2 or Baa2 (as the case may be) by Moody's Investors Service, Inc., (iv) the market
value of investments held by any member of the Group in Approved Funds, and (v) any deposit of not more than three months' maturity with a financial institution whose long term unsecured,
unsubordinated debt rating is at least BBB by Standard & Poor's Corporation or Baa2 by Moody's Investors Service, Inc.;  

        "Net Financial Payments" means the aggregate of all interest, commission, fees and other charges (including the interest payment component
included within the amount of any rent due under leases which in accordance with IFRS are classified and accounted for as financial leases in the financial statements of the relevant member of the
Group) incurred by members of the Group in respect of financial indebtedness less interest earned by members of the Group;

        "Net Worth" means the Parent's share capital fully paid up:

        plus the aggregate amount standing to the credit of the Group's consolidated share premium account;

        plus or minus the amount standing to the credit or debit, as the case may be, of the
consolidated profit and loss account of the Group;

        less (without double counting) any dividend or other distribution declared or made to the extent not already provided
for;

        less the amount of any writing up of the book value of any assets if that writing up is booked against the profit and loss account, all
writing up which is booked against a specific equity reserve of the Parent's share capital will be included in the definition "Net Worth");
and

        plus or minus the cumulative translation adjustment (as
applicable).  

        "Rolling Basis" refers to the calculation of a ratio or an amount made at the end of a Financial Half-Year in respect of that
Financial Half-Year and the preceding Half-Year.

Accounting Terms  

        All accounting expressions which are not otherwise defined herein shall be construed in accordance with IFRS/IAS. 

 
 

Covenants    
    

Maintenance of Legal Validity  

        Each of the Obligors shall obtain, comply with the terms of and do all that is necessary to maintain in full force and effect all authorisations, approvals,
licences and consents required in or by the laws and regulations of its jurisdiction of incorporation to enable it lawfully to enter into and perform its obligations under the Finance Documents and to
ensure the legality, validity, enforceability or admissibility in evidence in its jurisdiction of incorporation of the Finance Documents and shall maintain adequate books and records and maintain all
assets necessary for it to continue its business in good working order, taking into account fair wear and tear. 

Insurance  

        The Parent shall procure that each member of the Group maintains insurances on and in relation to its business and assets with reputable underwriters or insurance
companies against such risks and to 

31

 

such
extent as is usual for companies carrying on a business such as that carried on by such member of the Group. 

Untrue Representations  

        After the delivery of any Notice of Drawdown and before the making of the Advance requested therein and also not more than ten and not less than five business
days before the Term-out Date, the Parent shall notify the Facility Agent of the occurrence of any event of which it is aware, having made due enquiry, which results in or may reasonably
be expected to result in any of the representations contained in Clause 0 (Representations) which are to be repeated pursuant to Clause 0
(Repetition) being untrue at or before the time of the making of such Advance or as at the Term-out Date (as the case may be). 

Notification of Events of Default  

        Each of the Obligors shall promptly inform the Facility Agent of the occurrence of any Event of Default or Potential Event of Default and of the commencement of
any proceedings of or before any court or agency of which it is aware, having made due enquiry, which is reasonably likely to have a material adverse effect on the business or financial condition of
any of the Obligors or the Group taken as a whole and, upon receipt of a written request to that effect from the Facility Agent where the Facility Agent (acting on the instructions of an Instructing
Group) has reasonable grounds to believe that such an event has occurred, confirm to the Facility Agent that, save as previously notified to the Facility Agent or as notified in such confirmation, no
Event of Default or Potential Event of Default has occurred. 

Claims Pari Passu  

        Each of the Obligors shall ensure that at all times the claims of the Facility Agent, the Mandated Lead Arrangers, the Co-Arrangers and the Banks
against it under the Finance Documents rank at least pari passu with the claims of all its other unsecured creditors save those whose claims are
preferred by any bankruptcy, insolvency, liquidation or other similar laws of general application. 

Negative Pledge  

        The Parent shall ensure that no member of the Group shall, without the prior written consent of an Instructing Group, create or permit to subsist any encumbrance
over all or any of its present or future revenues or assets other than a Permitted Encumbrance. 

Loans and Guarantees  

        The Parent shall ensure that no member of the Group shall, without the prior written consent of an Instructing Group (subject to Clause 0
(Financial Indebtedness and Guarantees of Guccio Gucci S.p.A.) other than to or for the benefit of another member of the Group or otherwise in the
ordinary course of business), make any loans, grant any credit or give any guarantee or indemnity (except as required hereby) to or for the benefit of any person or otherwise voluntarily assume any
liability, whether actual or contingent, in respect of any obligation of any other person. 

Disposals  

        Subject to sub-clauses 0, 0 and 0 below, the Parent shall ensure that no member of the Group shall, without the prior written
consent of an Instructing Group, sell, lease, transfer or otherwise dispose of, by one or more transactions or series of transactions (whether related or not) the whole or any part of the Material
Intellectual Property or its interest in the whole or any part of the Material  

32

 

 Intellectual Property or any company (or its interest in any company) which owns Material Intellectual Property or to which Material Intellectual Property is licensed.  

        Sub-clause 0 shall not apply to disposals of, or of interests in, Relevant Material Intellectual Property, nor to
disposals of companies (or interests in companies) which own or to which are licensed Relevant Material Intellectual Property. "Relevant Material Intellectual Property" means Material Intellectual
Property which falls within paragraph (b) of the definition of "Material Intellectual Property" and which has a fair market value not exceeding €500,000,000 (or equivalent); for
the purposes of this definition cognate or related brands shall be deemed to constitute a single item of Material Intellectual Property.

 Notwithstanding sub-clause 0 above,  

        any member of the Group shall be entitled to grant licences or sub-licences of its respective Material Intellectual
Property provided that such licences or sub-licences:

        are granted in the ordinary course of business and on arm's length terms; and  

        are on terms which reserve to the Group creative and editorial control and otherwise enable compliance with Clause 0
(Material Intellectual Property); and

        any member of the Group shall be entitled to grant licences or sub-licences of its respective Material Intellectual Property to any other member of
the Group (which is not an Obligor) (each a "Licence Holding Company"), provided
that:

        the licence or sub-licence is granted:  

        in the ordinary course of business and on arm's length terms; and  

        on terms which reserve to the Group creative and editorial control and otherwise enable compliance with Clause 0
(Material Intellectual Property); and  

        as soon as reasonably practicable following such grant, the Licence Holding Company is sold to a third party, and the sale is made on
arm's length terms.

        Notwithstanding sub-clause 0 above, any member of the Group shall be entitled to sell, lease, transfer or otherwise dispose of, to a Guarantor,
by one or more transactions or series of transactions (whether related or not) the whole or any part of the Material Intellectual Property or its interest in the whole or any part of the Material
Intellectual Property or any company (or its interest in any company) which owns Material Intellectual Property or to which Material Intellectual Property is licensed.

Financial Indebtedness and Guarantees of Guccio Gucci S.p.A.  

        The Parent shall ensure that Guccio Gucci S.p.A. and any other member of the Group holding shares in that company (other than the Parent) shall not, without the
prior written consent of an Instructing Group (other than hereunder or under the Existing Facility): 

        raise funds by borrowing in the international loan and/or bond markets or guarantee or indemnify any such borrowings; or  

        borrow moneys or permit to remain outstanding any borrowings in the Italian domestic market exceeding in aggregate
€125,000,000 (or the equivalent in any other currency) or guarantee or indemnify any such borrowings,

        provided that Guccio Gucci S.p.A. shall be permitted to enter into (i) this Agreement; (ii) arrangements to refinance or
replace the Existing Facility and any other financial indebtedness 

33

 

existing
at the date of this Agreement; and (iii) any new financial indebtedness up to a maximum aggregate amount of €125,000,000 (or the equivalent in any other currency). 

Financial Indebtedness of Subsidiaries  

        Without prejudice to Clause 0 (Financial Indebtedness and Guarantees of Guccio Gucci S.p.A.), the Parent
shall procure that its subsidiaries which are not Guarantors under this Agreement (not including Guccio Gucci S.p.A. or any member of the Group which is not a Guarantor but is named as a guarantor in
the Existing Facility) shall not, without the prior written consent of an Instructing Group, incur or have outstanding financial indebtedness (other than financial indebtedness incurred or
outstanding from another member of the Group) in an aggregate amount exceeding €350,000,000 (or the equivalent in other currencies). 

Dividends  

        The Parent shall procure that its subsidiaries which are not Guarantors under this Agreement and whose earnings, revenues or assets represent more than 5 per
cent. of the consolidated earnings before interest and tax or revenues or total assets of the Group (all as determined by reference to the latest financial statements of the Group) remain entitled and
eligible to pay dividends where the same are legally payable under the laws of their jurisdiction of incorporation. 

Mergers and Consolidations  

        The Parent shall not permit any merger or consolidation of any Obligor or Guccio Gucci S.p.A. with any other person other than: 

        with any other Obligor; or  

        with any other member of the Group, provided such member of the Group is a wholly-owned subsidiary of the Parent, the Obligor is the
surviving company and remains responsible for all the obligations of that Obligor under the Finance Documents notwithstanding the merger,

        in
each case where such merger or consolidation would not reasonably be considered adversely to affect the position of the Banks. 

Taxes  

        The Parent shall ensure that each member of the Group shall duly and punctually pay and discharge prior to the imposition of any material penalty all taxes,
assessments and governmental charges imposed upon it or its assets and all lawful claims which, if unpaid, would by law become encumbrances upon its assets other than those being contested in good
faith where the non-payment is permitted by applicable law. 

Material Intellectual Property  

        The Parent will, and shall ensure that each other member of the Group will: 

        diligently pursue such legal remedies as are reasonably available to it to maintain and preserve its legal and commercial interests in its respective Material
Intellectual Property other than where, in the reasonable commercial judgment of the Parent and such other member of the Group, having regard to, amongst other things, the size of the relevant market,
the business prospects for the Group in such market and the legal risks (including the risk of adverse precedent) involved, it considers that it is not prudent to pursue such remedies;
and

        generally:  

34

 

        protect, preserve and promote the value, status and integrity of its respective Material Intellectual Property;

        maintain artistic and editorial control over its respective Material Intellectual Property; and  

        ensure the focus and consistency of its respective Material Intellectual Property in the luxury goods and high end fashion apparel
market,

        (but,
if the Material Intellectual Property is not owned by the relevant member of the Group, only to the extent consistent with its interest in it). 

Arm's-length transactions  

        The Parent shall ensure that no member of the Group shall enter into any arrangement or contract with any person other than any other member of the Group other
than on what the Parent, in its reasonable commercial opinion, considers to be an arm's-length basis. 

Notice requirements  

        Each Obligor will promptly notify the Facility Agent of the occurrence of any of the following events: 

        any Reportable Event;  

        a failure to make any required contribution to a Plan or the creation of any lien in favour of the United States Pension Benefit Guaranty
Corporation or a Plan;

        termination of any Plan maintained or contributed by that Obligor or any of its ERISA Affiliates, and of any action that might result in termination; or  

        complete or partial withdrawal from any Multiemployer Plan by that Obligor or any of its ERISA Affiliates, or any action that might result
in complete or partial withdrawal.

        Each
notice under this Clause will include reasonable details concerning the occurrence that is the subject of the notice as well as the Obligor's proposed course of action, if any, in
relation thereto. Delivery of a notice under this Clause will not affect the Obligor's obligations to comply with any other provision of the Finance Documents. 

Investment Company Act  

        No Obligor will, either by act or omission, become, or permit any other Obligor to become, an "investment company"
or a company "controlled" by an "investment company", within the meaning of the United States Investment
Company Act of 1940, as amended. 

ERISA  

        No Obligor will take any action or omit to take any action or permit any of its subsidiaries or ERISA Affiliates to take any action or omit to take any action
with respect to any Plan that might result in the imposition of a lien or other Security Interest on any property of the Obligor or any of its subsidiaries or that otherwise might have a material
adverse effect on the business or financial condition of any Obligor or the Group taken as a whole. 

Federal Reserve Regulations  

        Each US Borrower will use the Facilities without violating Regulations T, U and X. 

35

 

Embargoed Person  

        At all times through the term of the Facilities, (a) none of the funds or assets of the Obligors that are used to repay the Facilities shall constitute
property of, or shall be beneficially owned directly or, to the knowledge of any Obligor, indirectly by, any person subject to sanctions or trade restrictions under United States law
("Embargoed Person" or "Embargoed Persons") and (b) no Embargoed Person (other than any holder of
any publicly listed shares in the Parent) shall have any direct interests and, to the knowledge of any Obligor, as of the date hereof, based upon reasonable inquiry by any Obligor, indirect interest
of any nature whatsoever in the Obligors, with the result that such interest in the Obligors (whether directly or indirectly), is prohibited by law or the Facilities are in violation of law. 

Anti-Money Laundering  

        At all times throughout the term of the Facilities, to the best knowledge of each Obligor (based upon reasonable inquiry by such Obligor), none of the funds of
such Obligor that are used to re-pay the Facilities shall be derived from any unlawful activity. 

 
 

Events of Default    
    

        Each of Clause 0 (Failure to Pay) to Clause 0
(ERISA) describes circumstances which constitute an Event of Default for the purposes of this Agreement. Clause 0
(Acceleration and Cancellation), Clause 0 (Automatic Acceleration) and Clause 0
(Advances Due on Demand) deal with the rights of the Facility Agent and the Banks after the occurrence of an Event of Default. 

Failure to Pay  

        Any of the Obligors fails to pay any sum of principal or interest due from it hereunder at the time (or within three days of the due date for payment thereof
where such failure is due to a technical or administrative difficulty in payment of funds), in the currency and in the manner specified herein, or any other sum apart from principal or interest due
from it hereunder is not paid at the time, (or within five days of the due date for payment), in the currency and in the manner specified herein. 

Misrepresentation  

        Any representation (other than, without prejudice to any other representation given hereunder, the representation given by the Dutch Borrowers under
Clause 25.12.2 if such representation is incorrect or misleading in any respect by reason of a Bank not being a PMP) or statement made by any of the Obligors in this Agreement or in any notice
or other document, certificate or statement delivered by it pursuant hereto or in connection herewith is or proves to have been incorrect or misleading when made or deemed repeated and, if capable of
remedy, is not remedied within 30 days of the earlier of the Parent's knowledge thereof or notice thereof to the Parent by the Facility Agent. 

Specific Covenants  

        Any of the Obligors fails duly to perform or comply with any of the obligations expressed to be assumed by it: 

        in any of Clauses 0 (Negative Pledge), 0 (Disposals), 0
(Financial Indebtedness and Guarantees of Guccio Gucci S.p.A.), 0 (Financial Indebtedness of
Subsidiaries), 0 (Mergers and Consolidations), 0 (Additional Guarantors) or 0
(Removal of Guarantors); or

        in Clause 0 (Financial Information) other than where such failure is a failure to comply with
Clause 0 (Other Financial Information) (to which Clause 0 (Other Obligations) will apply)
or is due to a technical or administrative difficulty and is remedied promptly upon (and in any event within 10 days of) the earlier of the Parent's knowledge thereof or notice thereof to the
Parent by the Facility Agent.

36

 

Other Obligations  

        Any of the Obligors fails duly to perform or comply with any other material obligation expressed to be assumed by it in this Agreement and such failure, if
capable of remedy, is not remedied within 30 days of the earlier of the Parent's knowledge thereof or notice thereof to the Parent by the Facility Agent. 

Financial Condition  

        At any time any of the requirements of Clause 0 (Financial Condition of the Group) is not satisfied. 

Cross Default  

        Any financial indebtedness of any member of the Group is not paid when due, any financial indebtedness of any member of the Group is (and is permitted to be)
declared to be or otherwise becomes due and payable prior to its specified maturity or any creditor or creditors of any member of the Group become entitled to declare any financial indebtedness of any
member of the Group due and payable prior to its specified maturity and the aggregate of all such financial indebtedness of the Group exceeds €10,000,000 (or its equivalent in other
currencies). 

Insolvency and Rescheduling  

        Any Material Company is unable to pay its debts as they fall due, commences negotiations with any one or more of its creditors with a view to the general
readjustment or rescheduling of its indebtedness or makes a general assignment for the benefit of, or a composition with, its creditors. 

Winding-up  

        Any Material Company takes any corporate action or other steps are taken or legal proceedings are started for its winding-up, dissolution,
administration or insolvent re-organisation or for the appointment of a liquidator, receiver, administrator, administrative receiver, conservator, custodian, trustee or similar officer of
it or of any or all of its revenues and assets under any applicable insolvency or similar law. 

Execution or Distress  

        Any execution or distress is levied against, or an encumbrancer takes possession of, the whole or any part of, the property, undertaking or assets of any Material
Company and the aggregate of all underlying claims exceeds €10,000,000 (or its equivalent in other currencies). 

Analogous Events  

        Any event occurs in relation to any Material Company which under the laws of any jurisdiction has a similar or analogous effect to any of those events mentioned
in Clause 0 (Insolvency and Rescheduling), Clause 0 (Winding-up) or (subject
to the €10,000,000 excess referred to in Clause 0 (Execution or Distress)) Clause 0 (Execution or
Distress). 

Governmental Intervention  

        By or under the authority of any government all or a majority of the issued shares of any Material Company or the whole or any part of the consolidated assets of
the Group (the book value of which is 20 per cent. or more of the book value of the whole) is seized, nationalised, expropriated or compulsorily acquired. 

37

 

Ownership of the Obligors  

        Any of the Obligors or Guccio Gucci S.p.A. (other than the Parent) ceases to be a wholly-owned subsidiary of the Parent. 

Unsatisfied Judgments  

        Any member of the Group fails to pay a judgment or court order in excess of €10,000,000 (or its equivalent in other currencies) awarded against it
within any applicable time period other than if it is permitted by relevant law not to pay. 

The Group's Business  

        Any Material Company ceases to carry on or changes its business with the effect that the design, manufacture and distribution of luxury goods and high end fashion
apparel and accessories ceases to be the principal business of the Group. 

Repudiation  

        Any of the Obligors repudiates this Agreement. 

Illegality  

        At any time it is or becomes unlawful for any of the Obligors to perform or comply with any or all of its material obligations hereunder or any of the material
obligations of any of the Obligors hereunder are not or cease to be legal, valid, binding and enforceable. 

Material Adverse Change  

        There occurs in the opinion of an Instructing Group a change in the business or financial condition of any of the Obligors or the Group taken as a whole which is
reasonably likely to materially adversely affect the ability of the Obligors to perform their obligations hereunder. 

38

  

US Bankruptcy Laws  

        Any Obligor commences a voluntary case or proceeding under the United States Bankruptcy Code of 1978, as amended, or under any other
United States Federal or State bankruptcy, insolvency or other similar law (collectively "US Bankruptcy laws"); or  

        an involuntary case under any US Bankruptcy Law is commenced against any Obligor and the petition is not controverted within
30 days and is not dismissed or stayed within 90 days after commencement of the case; or  

        a custodian, conservator, receiver, liquidator, assignee, trustee, sequestrator or other similar official is appointed under any US
Bankruptcy Law for or takes charge of, all or substantial part of the property of any Obligor.  

 ERISA  

        Any event occurs or condition exists that presents a material risk that any Obligor or any ERISA Affiliate may incur a material liability
to a Plan or to the United States Internal Revenue Service or to the United States Pension Benefit Guaranty Corporation; or  

        an "accumulated funding deficiency" (as that term is defined in section 412 of the United States Internal Revenue Code of 1986, as
amended, or section 302 of ERISA) exists, whether or not waived, by reason of the failure of any Obligor or any ERISA Affiliate to make a contribution to a Plan which would be reasonably likely
to lead to a material liability on the part of any Obligor.

Acceleration and Cancellation  

        Upon the occurrence of an Event of Default or at any time thereafter, the Facility Agent may (and, if so instructed by an Instructing Group, shall) by written
notice to the Parent: 

        declare the Advances to be immediately due and payable (whereupon the same shall become so payable together with accrued interest thereon and any other sums then
owed by the Borrowers hereunder) or declare the Advances to be due and payable on demand of the Facility Agent; and/or

        declare that the Facilities shall be cancelled, whereupon the same shall be cancelled and the Commitment(s) of each Bank shall be reduced to
zero.

Automatic Acceleration  

        At any time after the occurrence of an Event of Default under Clause 0 (Insolvency and Rescheduling) or
Clause 0 (Winding-up) in respect of any Borrower that takes any steps set out under such Clause 0
(Insolvency and Rescheduling) or Clause 0 (Winding-up) in the United States of
America, the Loans made to such Borrower shall be immediately due and payable without notice from the Facility Agent (together with accrued interest and commission and any other sums then owed by such
Borrower under this Agreement). 

Advances Due on Demand  

        If, pursuant to Clause 0 (Acceleration and Cancellation), the Facility Agent declares the Advances to be
due and payable on demand of the Facility Agent, then, and at any time thereafter, the Facility Agent may (and, if so instructed by an Instructing Group, shall) by written notice to the Borrowers
require repayment of the Advances on such date as it may specify in such notice (whereupon the same shall become due and payable on such date together with accrued interest thereon and any other sums
then owed by the Borrowers hereunder) or withdraw its declaration with effect from such date as it may specify in such notice. 

39

 

Length of Terms  

        If, pursuant to Clause 0 (Acceleration and Cancellation), the Facility Agent declares the Advances to be
due and payable on demand of the Facility Agent, the Term in respect of any such Advance shall, if the Facility Agent subsequently demands payment before the scheduled Repayment Date in respect of
such Advance, be deemed (except for the purposes of Clause 0 (Broken Periods)) to be of such length that it ends on the date that such demand is
made. 

 
 

Guarantee and Indemnity    
    

Guarantee  

        Each of the Guarantors irrevocably and unconditionally as a primary obligation guarantees to the Facility Agent, the Mandated Lead Arrangers, the
Co-Arrangers and the Banks the due and punctual observance and performance of all the terms, conditions and covenants on the part of the Borrowers (other than itself) contained in this
Agreement and agrees to pay to the Facility Agent from time to time on demand any and every sum or sums of money which the Borrowers are at any time liable to pay to the Facility Agent, the Mandated
Lead Arrangers, the Co-Arrangers and the Banks or any of them under or pursuant to this Agreement and which has become due and payable but has not been paid at the time such demand is
made. Notwithstanding the foregoing in this Clauses 0 (Guarantee), where the Guarantor is an Italian Obligor, a demand for payment on such Guarantor
shall only be made after a request for payment has been made to the relevant Borrowers and such Borrowers have not complied with such request within three (3) Business Days from the date of the
request. 

Indemnity  

        Each of the Guarantors irrevocably and unconditionally agrees as a primary obligation to indemnify the Facility Agent, the Mandated Lead Arrangers, the
Co-Arrangers and the Banks from time to time on demand by the Facility Agent (or any Bank through the Facility Agent) from and against any loss incurred by the Facility Agent, the Mandated
Lead Arrangers, the Co-Arrangers and the Banks or any of them as a result of any of the obligations of any of the Borrowers (other than itself) under or pursuant to this Agreement being or
becoming void, voidable, unenforceable or ineffective as against any of the Borrowers for any reason whatsoever,
whether or not known to the Facility Agent, the Mandated Lead Arrangers, the Co-Arrangers and the Banks or any of them or any other person, the amount of such loss being the amount which
the person or persons suffering it would otherwise have been entitled to recover from the relevant Borrower provided that: 

        in relation to each US Obligor, its obligations under this Clause 0 as Guarantor shall be limited to the largest amount as would not render such
obligations subject to avoidance under Section 548 of the United States Bankruptcy Code, Title 11, USC, or any applicable provision of comparable law of any state of the United States of
America;

        in relation to each Japanese Obligor, its obligations under this Clause 0 as Guarantor shall be limited to no greater than the maximum amount that would
not render such obligations subject to avoidance under Section 424 of the Civil Code of Japan or Section 72 of the Bankruptcy Law of Japan, or any similar provision of other Japanese law
relating to insolvency;

        in relation to each French Obligor, their obligations under this Clause 0 as Guarantors shall:

        not include any obligation which would constitute prohibited financial assistance under French law, as defined under article L.225-216 of the
French Commercial Code (if applicable) (including, without limitation, obligations in respect of Advances used in connection with the financing or refinancing of the acquisition by the Group
(i) of the shares of any direct or indirect parent company of the relevant French Obligor, or (ii) of the shares of such French Obligor); and

40

 

        be limited at any time to the lesser of:  

        85 per cent of the Net Asset Value of the relevant Guarantor as at the date of this Agreement; and  

        85 per cent of the Net Asset Value of the relevant Guarantor at the date demand is made under the guarantee; or  

        at the date demand is made under the guarantee, the outstanding amount of the inter company loan which is financed by the proceeds of the
Facility and made available to the relevant Guarantor by its parent company.

        In
this sub-clause 0, the "Net Asset Value" of a Guarantor means its capitaux
propres (as defined in accordance with applicable French accounting laws, decrees and regulations). 

Italian Obligors  

        In relation to each Italian Obligor, their obligations under this Clause 16 as Guarantors will not exceed the highest of: 

        an amount equal to such Italian Obligor's Net Worth (as defined below), as determined by such Italian Obligor's most recent financial statements approved by its
shareholders' general meeting, at the time such Italian Obligor executes this Agreement;

        an amount equal to such Italian Obligor's Net Worth, as determined from time to time on the basis of such Italian Obligor's most recent financial statements
approved by its shareholders' general meeting; and

        an amount equal from time to time to the aggregate financial indebtedness assumed by such Italian Obligor which derives, directly or indirectly, from any amounts
borrowed by such Obligor under this Agreement,

        and,
in any event, in respect of each Italian Guarantor, shall be limited to an amount of €575,000,000. 

        For
the purpose of this sub-clause 0: "Net Worth" means the total value of the net worth
("Patrimonio Netto") of each Italian Obligor within the meaning given to such term by Art. 2424 of the Italian Civil Code. 

Additional Security  

        The obligations of the Guarantors herein contained shall be joint and several and in addition to and independent of every other security which the Facility Agent,
the Mandated Lead Arrangers, the
Co-Arrangers and the Banks or any of them may at any time hold in respect of any of the Borrowers' obligations hereunder. 

Continuing Obligations  

        The obligations of the Guarantors herein contained shall constitute and be continuing obligations notwithstanding any settlement of account or other matter or
thing whatsoever and shall not be considered satisfied by any intermediate payment or satisfaction of all or any of the obligations of any of the Borrowers under this Agreement and shall continue in
full force and effect until final payment in full of all amounts owing by the Borrowers hereunder and total satisfaction of all the Borrowers' actual and contingent obligations hereunder. 

41

 

Obligations not Discharged  

        Neither the obligations of the Guarantors herein contained nor the rights, powers and remedies conferred in respect of the Guarantors upon the Facility Agent, the
Mandated Lead Arrangers and the Banks or any of them by this Agreement or by law shall be discharged, impaired or otherwise affected by: 

        the winding-up, dissolution, administration or re-organisation of any of the Borrowers or any other person or any change in its status,
function, control or ownership;

        the release of any other Obligor or any other person under the terms of any composition or arrangement with any creditor of any member of the
Group;

        any of the obligations of any of the Borrowers or any other person hereunder or under any other security taken in respect of any of its obligations hereunder
being or becoming illegal, invalid, unenforceable or ineffective in any respect;

        time or other indulgence being granted or agreed to be granted to any of the Borrowers in respect of its obligations hereunder or under any such other
security;

        any amendment to, or any variation, waiver or release of, any obligation of any of the Borrowers hereunder or under any such other
security;

        any failure to take, or fully to take, any security contemplated hereby or otherwise agreed to be taken in respect of any of the Borrowers' obligations
hereunder;

        any failure to realise or fully to realise the value of, or any release, discharge, exchange or substitution of, any security taken in respect of any of the
Borrowers' obligations hereunder; or

        any other act, event or omission which, but for this Clause 0, might operate to discharge, impair or otherwise affect any of the obligations of the
Guarantors herein contained or any of the rights, powers or remedies conferred upon the Facility Agent, the Mandated Lead Arrangers, the Co-Arrangers and the Banks or any of them by this
Agreement or by law.

Settlement Conditional  

        Any settlement or discharge between any of the Guarantors and the Facility Agent, the Mandated Lead Arrangers and the Banks or any of them shall be conditional
upon no security or payment to the Facility Agent, the Mandated Lead Arrangers, the Co-Arrangers and the Banks or any of them by the Borrowers or the Guarantors or any other person on
behalf of the Borrowers or, as the case may be, the Guarantors being avoided or reduced by virtue of any provisions or enactments relating to bankruptcy, insolvency, liquidation or similar laws of
general application for the time being in force and, if any such security or payment is so avoided or reduced, the Facility Agent, the Mandated Lead Arrangers, the Co-Arrangers and the
Banks shall each be entitled to recover the value or amount of such security or payment from the Guarantors subsequently as if such settlement or discharge had not occurred. 

Exercise of Rights  

        Neither the Facility Agent, the Mandated Lead Arrangers, the Co-Arrangers and the Banks nor any of them shall be obliged before exercising any of the
rights, powers or remedies conferred upon them in respect of the Guarantors by this Agreement or by law: 

        to make any demand of any of the Borrowers;  

        to take any action or obtain judgment in any court against any of the Borrowers;

        to make or file any claim or proof in a winding-up or dissolution of any of the Borrowers; or  

42

 

        to enforce or seek to enforce any other security taken in respect of any of the obligations of any of the Borrowers
hereunder.

Deferral of Guarantors' Rights  

        The Guarantors agree that, so long as any amounts are or may be owed by any of the Borrowers hereunder or the Borrowers are under any actual or contingent
obligations hereunder, the Guarantors shall not exercise any rights which the Guarantors may at any time have by reason of performance by them of their obligations hereunder: 

        to be indemnified by any of the Borrowers; and/or  

        to claim any contribution from any other guarantor of any of the Borrowers' obligations hereunder; and/or  

        to take the benefit (in whole or in part and whether by way of subrogation or otherwise) of any rights of the Facility Agent, the Mandated
Lead Arrangers, the Co-Arrangers and the Banks hereunder or of any other security taken pursuant to, or in connection with, this Agreement by all or any of the Facility Agent, the Mandated
Lead Arrangers, the Co-Arrangers and the Banks.

Suspense Accounts  

        All moneys received, recovered or realised by a Bank by virtue of Clause 0 (Guarantee) or Clause 0
(Indemnity) may, in that Bank's discretion, be credited to a suspense or impersonal account and may be held in such account for so long as such Bank
thinks fit pending the application from time to time (as such Bank may think fit) of such moneys in or towards the payment and discharge of any amounts owing by any of the Obligors to such Bank
hereunder. Interest accrued on such amounts (if any) shall be for the account of the relevant Obligor. 

Swiss Obligors  

        Without prejudice to Clause 0 (Guarantee) and 0
(Indemnity), each Swiss Obligor shall: 

        only be liable to the Facility Agent, the Mandated Lead Arrangers, the Co-Arrangers and the Banks in relation to the obligations of a Borrower to the
extent and in the maximum amount of its profits available for the distribution of dividends (being the balance sheet profits and any reserves made in respect of distributions of dividends, all in
accordance with Article 675, paragraph 2 of the Swiss Code of Obligations) at the relevant time;

        deduct from any payments made by it under this Clause 0, Swiss Federal Withholding Tax at the rate of 35 per cent. (or such other rate as in force at the
relevant time) (but subject to the relieving provisions of any applicable double taxation treaty);

        pay the amount deducted to the Swiss Federal Tax Administration; and  

        promptly give evidence to the Facility Agent, the Mandated Lead Arrangers, the Co-Arrangers or the Banks (as the case may be)
of such deduction; and  

        not be required to gross up pursuant to Clause 0 (Tax Gross-up) in
relation to payments made under this Clause 0 only,

        and
provided that all indemnities and guarantees contained in the Finance Documents and given by the Swiss Obligors in respect of the
obligations of an Obligor shall be construed in a manner consistent with this Clause 0. 

43

 

US Obligors—consideration and enforceability  

        Each US Obligor represents, warrants and agrees that:  

        it will receive valuable direct and indirect benefits as a result of the transactions financed by the Loan; and  

        these benefits will constitute "reasonably equivalent value" and
"fair consideration" as those terms are used in the fraudulent transfer laws.

        Each US Obligor acknowledges and agrees that each of the Facility Agent, Mandated Lead Arrangers, the Co-Arrangers and the Banks has acted in good
faith in connection with the guarantee granted under this Clause 0 and the transactions contemplated by the Finance Documents.

        This Clause 0 shall be enforceable against each US Obligor to the maximum extent permitted by the fraudulent transfer laws.

        Each US Obligor's liability under this Clause 0 shall be limited so that no obligation of, or transfer by, a US Obligor under this Clause 0 is
subject to avoidance and turnover under the fraudulent transfer laws.

        For purposes of this Clause, "fraudulent transfer laws" mean applicable United States bankruptcy and State fraudulent transfer and conveyance statutes and the
related case law.

 
 

Default Interest and Indemnity    
    

Default Interest Periods  

        If any sum due and payable by any of the Obligors hereunder is not paid on the due date therefor in accordance with the provisions of Clause 0
(Payments) or if any sum due and payable by any of the Obligors under any judgment of any court in connection herewith is not paid on the date of such
judgment, the period beginning on such due date or, as the case may be, the date of such judgment and ending on the date upon which the obligation of such Obligor to pay such sum (the balance thereof
for the time being unpaid being herein referred to as an "unpaid sum") is discharged shall be divided into successive periods, each of which (other than
the first) shall start on the last day of the preceding such period and the duration of each of which shall (except as otherwise provided in this Clause 0) be selected by the Facility Agent. 

Default Interest  

        During each such period relating thereto as is mentioned in Clause 0 (Default Interest Periods) an unpaid
sum shall bear interest at the rate per annum which is the sum from time to time of one per cent., the applicable Facility B Margin and LIBOR on the Quotation Date therefor  provided that: 

        if, for any such period, LIBOR cannot be determined, the rate of interest applicable to such unpaid sum shall be the rate per annum which is the sum of one per
cent., the applicable Facility B Margin and the rate per annum determined by the Facility Agent to be equal to the arithmetic mean (rounded upwards, if not already such a multiple, to the nearest
whole multiple of one-sixteenth of one per cent.) of the rates notified by each of the Reference Banks to the Facility Agent before the last day of such period to be those which express as
a percentage rate per annum the cost to it of funding from whatever sources it may select its portion of such unpaid sum for such period; and

        if such unpaid sum is all or part of an Advance which became due and payable on a day other than the last day of a Term thereof, the first such period applicable
thereto shall be of a duration equal to the unexpired portion of that Term and the rate of interest applicable thereto from time to  

44

 

 time during such period shall be that which exceeds by one per cent. the rate which would have been applicable to it had it not so fallen due.

Payment of Default Interest  

        Any interest which shall have accrued under Clause 0 (Default Interest) in respect of an unpaid sum shall
be due and payable and shall be paid by the Obligor owing such unpaid sum at the end of the period by reference to which it is calculated or on such other dates as the Facility Agent may specify by
written notice to such Obligor. 

Broken Periods  

        If any Bank or the Facility Agent on its behalf receives or recovers all or any part of such Bank's share of an Advance otherwise than on the last day of a Term
thereof, the relevant Borrower shall pay to the Facility Agent on demand for account of such Bank an amount equal to the amount (if any) by which (a) the additional interest which would have
been payable on the amount so received or recovered had it been received or recovered on the last day of that Term, exceeds (b) the amount of interest which in the opinion of the Facility Agent
would have been payable to the Facility Agent on the last day of that Term in respect of a deposit in the currency of the amount so received or recovered equal to the amount so received or recovered
placed by it with a prime bank in London for a period starting on the third business day following the date of such receipt or recovery and ending on the last day of that Term. 

Borrower's Indemnity  

        Each Borrower undertakes to indemnify, unless it can demonstrate that such cost, claim, loss, expense or liability arose by reason of the relevant person's
default in performance of its obligations hereunder or by reason of such person's gross negligence or wilful misconduct: 

        each of the Facility Agent, the Mandated Lead Arrangers, the Co-Arrangers and the Banks against any cost, claim, loss, expense (including legal fees)
or liability together with any VAT thereon, which any of them may sustain or incur as a consequence of the occurrence of any Event of Default or any default by any of the Borrowers in the performance
of any of the obligations expressed to be assumed by it in the Finance Documents;

        the Facility Agent against any cost or loss it may suffer or incur as a result of its entering into, or performing, any foreign exchange contract for the purposes
of Clause 0 (Payments);

        each Bank against any loss it may suffer or incur as a result of its funding or making arrangements to fund its portion of an Advance requested by any of the
Borrowers hereunder but not made by reason of the operation of any one or more of the provisions hereof;

        each Bank against any loss it may suffer or incur as a result of its funding its portion of an Advance in an Optional Currency which is denominated in Euros by
reason of the provisions of Clause 0 (Optional Currency); and

        each of the Facility Agent, the Mandated Lead Arrangers, the Co-Arrangers and the Banks and any of their respective affiliates, directors, officers,
agents or employees (each an "Indemnified Person") and hold them harmless from and against all costs, expenses (including reasonable legal fees and disbursements together with VAT thereon) and
liabilities arising out of or relating to any claim or any litigation or other proceedings (regardless of whether the Indemnified Person is a party thereto) that relate to the negotiation, preparation
and execution of this Agreement or the provision of the Facilities or making of Advances requested hereunder.

45

 

Unpaid Sums as Advances  

        Any unpaid sum shall (for the purposes of this Clause 0 and Clause 0 (Increased Costs)) be treated
as an Advance and accordingly in this Clause 0 and Clause 0 (Increased Costs) the term
"Advance" includes any unpaid sum and "Term", in relation to an unpaid sum, includes each such period
relating thereto as is mentioned in Clause 0 (Default Interest Periods). 

 
 

Currency of Account and Payment    
    

Currency of Account  

        The Euro is the currency of account and payment for each and every sum at any time due from either of the Obligors hereunder provided
that: 

        each repayment of an Advance or a part thereof shall be made in the currency in which such Advance is denominated at the time of that
repayment;

        each payment of interest shall be made in the currency in which the sum in respect of which such interest is payable is denominated;

        each payment in respect of costs and expenses shall be made in the currency in which the same were incurred;

        each payment pursuant to Clause 0 (Tax Indemnity) or Clause 0 (Increased
Costs) shall be made in the currency specified by the party claiming thereunder; and  

        any amount expressed to be payable in a currency other than Euros shall be paid in that other currency.

Currency Indemnity  

        If any sum due from any of the Obligors under this Agreement or any order or judgment given or made in relation hereto has to be converted from the currency (the
"first currency") in which the same is payable hereunder or under such order or judgment into another currency (the "second
currency") for the purpose of (a) making or filing a claim or proof against such Obligor, (b) obtaining an order or judgment in any court or other tribunal or
(c) enforcing any order or judgment given or made in
relation hereto, each of the Borrowers shall indemnify and hold harmless each of the persons to whom such sum is due from and against any loss suffered or incurred as a result of any discrepancy
between (i) the rate of exchange used for such purpose to convert the sum in question from the first currency into the second currency and (ii) the rate or rates of exchange at which
such person may in the ordinary course of business purchase the first currency with the second currency upon receipt of a sum paid to it in satisfaction, in whole or in part, of any such order,
judgment, claim or proof. 

 
 

Payments    
    

Payments to the Facility Agent  

        On each date on which this Agreement requires an amount to be paid by any of the Obligors or any of the Banks hereunder, such Obligor or, as the case may be, such
Bank shall make the same available to the Facility Agent: 

        where such amount is denominated in Euros, by payment in Euros and in same day funds to the Facility Agent's account number 82535.00 with UniCredito Italiano
Milan, (Attention: Mr I King, Reference: Gucci) (or such other account or bank as the Facility Agent may have specified for this purpose); or

46

 

        where such amount is denominated in an Optional Currency, by payment in such Optional Currency and in immediately available, freely transferable cleared funds to
such account with such bank in the principal financial centre of the country of such Optional Currency as the Facility Agent shall have specified for this purpose.

Alternative Payment Arrangements  

        If, at any time, it becomes impracticable (by reason of any action of any governmental authority or any change in law, exchange control regulations or any similar
event) for any of the Obligors to make any
payments hereunder in the manner specified in Clause 0 (Payments to the Facility Agent), then such Obligor may agree with each or any of the
Banks' alternative arrangements for the payment direct to such Bank of amounts due to such Bank(s) hereunder provided that, in the absence of any such
agreement with any Bank(s), such Obligor shall be obliged to make all payments due to such Bank in the manner specified herein. Upon reaching such agreement such Obligor and such Bank shall
immediately notify the Facility Agent thereof and shall thereafter promptly notify the Facility Agent of all payments made direct to such Bank. 

Payments by the Facility Agent  

        Save as otherwise provided herein, each payment received by the Facility Agent for the account of another person pursuant to Clause 0
(Payments to the Facility Agent) shall: 

        in the case of a payment received for the account of a Borrower, be made available by the Facility Agent to the relevant Borrower by
application:

        first, in or towards payment (on the date, and in the currency and funds, of receipt) of any amount then due from such Borrower hereunder to the person from whom
the amount was so received or in or towards the purchase of any amount of any currency to be so applied; and

        secondly, in or towards payment (on the date, and in the currency and funds, of receipt) to such account with such bank in the principal financial centre of the
country of the currency of such payment (or a Participating Member State or London if Euros) as such Borrower shall have previously notified to the Facility Agent for this purpose;
and

        in the case of any other payment, be made available by the Facility Agent to the person for whose account such payment was received (in the case of a Bank, for
the account of the Facility Office) for value the same day by transfer to such account of such person with such bank in the principal financial centre of the country of the currency of such payment
(or a Participating Member State or London if Euros) as such person shall have previously notified to the Facility Agent.

No Set-off  

        All payments required to be made by any of the Obligors hereunder shall be calculated without reference to any set-off or counterclaim and shall be
made free and clear of and without any deduction for or on account of any set-off or counterclaim. 

Clawback  

        Where a sum is to be paid hereunder to the Facility Agent for account of another person, the Facility Agent shall not be obliged to make the same available to
that other person or to enter into or perform any exchange contract in connection therewith until it has been able to establish to its satisfaction that it has actually received such sum, but if it
does so and it proves to be the case that it had not actually received such sum, then the person to whom such sum or the proceeds of such exchange contract was so made available shall on request
refund the same to the Facility Agent together with an amount sufficient to indemnify the Facility Agent against any cost or loss it may have 

47

 

suffered
or incurred by reason of its having paid out such sum or the proceeds of such exchange contract prior to its having received such sum. 

Partial Payments  

        If and whenever a payment is made by an Obligor hereunder and the Facility Agent receives an amount less than the due amount of such payment the Facility Agent
may apply the amount received towards the obligations of the Obligors hereunder in the following order: 

        first, in or towards payment of any unpaid costs and expenses of each of the Facility Agent and the Mandated Lead Arrangers, the Co-Arrangers under
this Agreement;

        secondly, in or towards payment pro rata of any accrued interest due but unpaid under this Agreement;

        thirdly, in or towards payment pro rata of any principal due but unpaid under this Agreement; and  

        fourthly, in or towards payment pro rata of any other sum due but unpaid under this Agreement.

Variation of Partial Payments  

        The order of partial payments set out in Clause 0 (Partial Payments) shall override any appropriation made
by any Obligor but the order set out in sub-clauses 0, 0 and 0 of Clause 0 (Partial Payments) may be varied if agreed by all the
Banks. 

 
 

Set-Off    
    

Contractual Set-off  

        Each Obligor authorises each Bank to apply any credit balance to which such Obligor is entitled on any account of such Obligor with that Bank in satisfaction of
any sum due and payable from such Obligor to such Bank hereunder but unpaid and for this purpose, each Bank is authorised to purchase with the moneys standing to the credit of any such account such
other currencies as may be necessary to effect such application. 

Set-off not Mandatory  

        No Bank shall be obliged to exercise any right given to it by Clause 0 (Contractual Set-off). 

 
 

Sharing    
    

Redistribution of Payments  

        Subject to Clause 0 (Recoveries Through Legal Proceedings), if, at any time, the proportion which any Bank
(a "Recovering Bank") has received or recovered (whether by payment, the exercise of a right of set-off or combination of accounts or
otherwise, in respect of its portion of any payment (a "relevant payment") to be made under this Agreement by any of the Obligors for account of such
Recovering Bank and one or more other Banks) is greater (the portion of such receipt or recovery giving rise to such excess proportion being herein called an "excess
amount") than the proportion thereof so received or recovered by the Bank or Banks so receiving or recovering the smallest proportion thereof, then: 

        such Recovering Bank shall inform the Facility Agent of such receipt or recovery and pay to the Facility Agent an amount equal to such excess
amount;

48

 

        there shall thereupon fall due from such Obligor to such Recovering Bank an amount equal to the amount paid out by such Recovering Bank pursuant to
sub-clause 0 above, the amount so due being treated, for the purposes hereof, as if it were an unpaid part of such Recovering Bank's portion of such relevant payment;
and

        the Facility Agent shall treat the amount received by it from such Recovering Bank pursuant to sub-clause 0 above as if such amount had been
received by it from such Obligor in respect of such relevant payment and shall pay the same to the persons entitled thereto (including such Recovering Bank) pro rata to their respective entitlements
thereto,

        provided that to the extent that any excess amount is attributable to a payment to a Bank pursuant to sub-clause 0 of
Clause 0 (Payments by the Facility Agent) such portion of such excess amount as is so attributable shall not be required to be shared pursuant
hereto. 

Repayable Recoveries  

        If any sum (a "relevant sum") received or recovered by a Recovering Bank in respect of any amount owing to it by
any of the Obligors becomes repayable and is repaid by such Recovering Bank, then: 

        each Bank which has received a share of such relevant sum by reason of the implementation of Clause 0 (Redistribution of
Payments) shall, upon request of the Facility Agent, pay to the Facility Agent for the account of such Recovering Bank an amount equal to its share of such relevant sum;
and

        there shall thereupon fall due from such Obligor to each such Bank an amount equal to the amount paid out by it pursuant to sub-clause 0 above,
the amount so due being, for the purposes hereof, treated as if it were the sum payable to such Bank against which such Bank's share of such relevant sum was applied.

Recoveries Through Legal Proceedings  

        If any Bank shall commence any action or proceeding in any court to enforce its rights hereunder and, as a result thereof or in connection therewith, shall
receive any excess amount (as defined in Clause 0 (Redistribution of Payments)), then such Bank shall not be required to share any portion of
such excess amount with any Bank which has the legal right to, but does not, join in such action or proceeding or commence and diligently prosecute a separate action or proceeding to enforce its
rights in another court. 

 
 

Commitment Commission and Fees    
    

Term Out Fee  

        Within 5 days of the Term-out Date the Parent shall pay to the Facility Agent for the account of each Bank a term out fee in an amount equal to
0.1 per cent. of the aggregate amount of each Bank's Facility A Advances which are converted to Term Advances. 

Commitment Commission  

        The Parent shall pay to the Facility Agent for account of each Bank a commitment commission on the amount of such Bank's Available
Facility A Commitment from day to day during the period beginning on the date hereof and ending on the Facility A Maturity Date, such commitment commission to be calculated at the rate equal to 33 per
cent. per annum of the Margin applicable to Facility A and payable in arrear on the last day of each successive period of three months starting on the date of this Agreement and ending at
three-monthly intervals thereafter, with the final such period ending on the Facility A Maturity Date.

49

  

        The Parent shall pay to the Facility Agent for account of each Bank a commitment commission on the amount of such Bank's Available Facility B Commitment from day
to day during the period beginning on the date hereof and ending on the Facility B Maturity Date, such commitment commission to be calculated at the rate equal to 40 per cent. per annum of the Margin
applicable to Facility B and payable in arrear on the last day of each successive period of three months starting on the date of this Agreement and ending at three-monthly intervals thereafter, with
the final such period ending on the Final Maturity Date.

        Accrued commitment commission shall also be payable to the Facility Agent for the relevant Bank on the cancelled amount of its Commitment(s), for the period up to
and including the time the cancellation comes into effect, at that time.

Participation Fee  

        The Parent shall pay to the Facility Agent for the account of the Banks the participation fees specified in the Fee Letter at the times and in the amounts
specified in such letter. 

Agency Fee  

        The Parent shall pay to each Agent for its own account the agency fees specified in the Fee Letter at the times and in the amounts specified in such letter. 

The Parent  

        Notwithstanding that the Parent is solely liable to the Facility Agent and the Banks for the fees referred to in this Clause 0, the other Borrowers shall,
as between the Borrowers and the Parent, be liable to reimburse the Parent for the amount of each fee which is attributable to them. 

 
 

Costs and Expenses    
    

Transaction Expenses  

        The Borrowers shall, from time to time on demand of the Facility Agent, reimburse the Facility Agent and each of Citigroup Global Markets Limited and The Royal
Bank of Scotland plc, Milan Branch for all reasonable costs and expenses (including reasonable legal fees) together with any VAT thereon incurred by them in connection with the negotiation,
preparation and execution of (a) this Agreement and the completion of the transactions herein contemplated, and (b) the accession of additional Borrowers pursuant to Clause 0
(Additional Borrowers) or the giving of any guarantees or other security pursuant to Clause 0 (Additional
Guarantors). 

Preservation and Enforcement of Rights  

        The Borrowers shall, from time to time on demand of the Facility Agent, reimburse the Facility Agent, the Mandated Lead Arrangers, the Co-Arrangers or
the Banks for all reasonable costs and expenses (including reasonable legal fees) together with any VAT thereon incurred in or in connection with the preservation and/or enforcement of any of the
rights of the Facility Agent, the Mandated Lead Arrangers, the Co-Arrangers or the Banks under this Agreement. 

Stamp Taxes  

        The Borrowers shall pay all stamp, registration and other taxes to which this Agreement or any judgment given in connection herewith is or at any time may be
subject, other than any such taxes arising by virtue of an assignment or transfer by any Bank pursuant to Clause 0 (Assignments and Transfers by
Banks) and shall, from time to time on demand of the Facility Agent, indemnify the Facility Agent, the Mandated Lead Arrangers, the Co-Arrangers and the Banks
against any liabilities, costs, claims and expenses resulting from any failure to pay or any delay in paying any such tax. 

50

 

Agents' Costs  

        The Parent shall, from time to time on demand of the Agent (and without prejudice to the provisions of Clause 0 (Preservation and
Enforcement of Rights) and Clause 0 (Amendment Costs)), compensate the Agents for all reasonable costs and expenses
(including telephone, fax, copying, travel and personnel costs) incurred by the Agents in connection with its taking such action as it may deem appropriate or in complying with any instructions from
an Instructing Group or any request by the Obligors or any of them in connection with: 

        the granting or proposed granting of any waiver or consent requested hereunder by the Obligors or any of them;

        any actual breach by the Obligors or any of them of its obligations hereunder;  

        the occurrence of any event which is an Event of Default or a Potential Event of Default; or  

        any amendment or proposed amendment hereto requested by the Obligors or any of them  

        and in relation to action taken in connection with sub-clauses 0 and 0 above, the Parent shall also compensate the Agents at such daily and/or hourly
rates as the Agents shall from time to time reasonably determine for the time they have respectively incurred. 

Banks' Liabilities for Costs  

        If any of the Borrowers fail to perform any of their obligations under this Clause 0, each Bank shall, in its Proportion, indemnify each of the Agents, the
Mandated Lead Arrangers and the Co-Arrangers against any loss incurred by any of them as a result of such failure and the Borrowers shall forthwith reimburse each Bank for any payment made
by it pursuant to this Clause 0 (Banks' Liabilities for Costs). 

 
 

The Agents, the Mandated Lead Arrangers, The Co-Arrangers and the Banks    
    

Appointment of the Agents  

        Each Mandated Lead Arranger, each Co-Arranger and each Bank hereby appoints each Agent to act as its agent in connection with the Finance Documents
and authorises each Agent to exercise such rights, powers, authorities and discretions as are specifically delegated to the Agents by the terms hereof together with all such rights, powers,
authorities and discretions as are reasonably incidental thereto provided that the Agents shall not start or commence any legal action on behalf of any
Bank without such Bank's prior written consent. 

Agents' Discretions  

        Each of the Agents may: 

        assume, unless it has in its capacity as Agent for the Banks received notice to the contrary from any other party hereto, that (i) any representation made
by any of the Obligors in connection with the Finance Documents is true, (ii) no Event of Default or Potential Event of Default has occurred, (iii) none of the Obligors is in breach of
or default under its obligations under the Finance Documents and (iv) any right, power, authority or discretion vested in an Instructing Group, the Banks or any other person or group of persons
has not been exercised;

        assume that the Facility Office or, as the case may be, each Facility Office of each Bank is that last notified to it;

        engage and pay for the advice or services of any lawyers, accountants, surveyors or other experts whose advice or services may to it seem necessary, expedient or
desirable and rely upon any advice so obtained;

51

 

        rely as to any matters of fact which might reasonably be expected to be within the knowledge of any of the Obligors upon a certificate signed by or on behalf of
such Obligor;

        rely upon any communication or document believed by it to be genuine;  

        refrain from exercising any right, power or discretion vested in it as Agent under the Finance Documents unless and until instructed by an
Instructing Group as to whether or not such right, power or discretion is to be exercised and, if it is to be exercised, as to the manner in which it should be exercised; and

        refrain from acting in accordance with any instructions of an Instructing Group to begin any legal action or proceeding arising out of or in connection with the
Finance Documents until it shall have received such security as it may require (whether by way of payment in advance or otherwise) for all costs, claims, losses, expenses (including legal fees) and
liabilities together with any VAT thereon which it will or may expend or incur in complying with such instructions.

Agents' Obligations  

        Each of the Agents shall: 

        promptly inform each Bank of the contents of any notice or document received by it in its capacity as Agent from any of the Obligors under the Finance
Documents;

        promptly notify each Bank of the occurrence of any Event of Default or any default by any of the Obligors in the due performance of or compliance with its
obligations under the Finance Documents of which the Agent has notice from any other party hereto;

        save as otherwise provided herein, act as agent under the Finance Documents in accordance with any instructions given to it by an Instructing Group, which
instructions shall be binding on all of the Mandated Lead Arrangers, the Co-Arrangers and the Banks; and

        if so instructed by an Instructing Group, refrain from exercising any right, power or discretion vested in it as Agent under the Finance
Documents.

Excluded Obligations  

        Notwithstanding anything to the contrary expressed or implied herein, neither of the Agents nor any of the Mandated Lead Arrangers nor the
Co-Arrangers shall: 

        be bound to enquire as to (i) whether or not any representation made by any of the Obligors in connection herewith is true, (ii) the occurrence or
otherwise of any Event of Default or Potential Event of Default, (iii) the performance by any of the Obligors of its obligations under the Finance Documents or (iv) any breach of or
default by any of the Obligors of or under its obligations under the Finance Documents;

        be bound to account to any Bank for any sum or the profit element of any sum received by it for its own account;

        be bound to disclose to any other person any information relating to any member of the Group if such disclosure would or might in its opinion constitute a breach
of any law or regulation or be otherwise actionable at the suit of any person;

        be bound to check any calculations submitted by Gucci Group N.V. relating to its financial condition pursuant to Clause 0
(Financial Condition of the Group) or to the Asset Test or EBIT Test or for conducting any calculations of their own in relation to the same and will
therefore be entitled to rely on statements and certificates produced by the Chief Financial Officer of the Group; or

        be under any obligations other than those for which express provision is made herein.

52

 

Indemnification  

        Each Bank shall, in its Proportion, from time to time on demand by the Agents, indemnify the Agents, against any and all costs, claims, losses, expenses
(including legal fees) and liabilities together with any
VAT thereon which the Agents may incur, otherwise than by reason of its own gross negligence or wilful misconduct, in acting in its capacity as Agent under the Finance Documents. 

Exclusion of Liabilities  

        None of the Agents, any of the Mandated Lead Arrangers nor the Co-Arrangers in their capacity as such accept any responsibility for the accuracy
and/or completeness of the Information Memorandum or any other information supplied by any of the Obligors in connection herewith nor for the legality, validity, effectiveness, adequacy or
enforceability of this Agreement or any other Finance Document and none of the Agents, the Mandated Lead Arrangers nor the Co-Arrangers in their capacity as such shall be under any
liability as a result of taking or omitting to take any action in relation to this Agreement or any other Finance Document, save in the case of gross negligence or wilful misconduct. 

No Actions  

        Each Bank agrees that it will not assert or seek to assert against any director, officer, employee or agent of the Agents or any Mandated Lead Arranger or
Co-Arranger any claim it might have against any of them in respect of the matters referred to in Clause 0 (Exclusion of Liabilities).
Any director, officer, employee or agent of the Agents, a Mandated Lead Arranger or a Co-Arranger may rely on this Clause 0 and enforce its terms under the Contracts (Rights of
Third Parties) Act 1999. 

Business with the Group  

        Each of the Agents, each of the Mandated Lead Arrangers and each of the Co-Arrangers may accept deposits from, lend money to and generally engage in
any kind of banking or other business with any member of the Group. 

Resignation and Termination  

        An Agent may resign or an Instructing Group may terminate its appointment under the Finance Documents at any time without assigning any reason therefor by giving
not less than 30 days' prior written notice to that effect to each of the other parties hereto provided that no such resignation or
termination shall be effective until a successor for the relevant Agent is appointed in accordance with the succeeding provisions of this Clause 0. 

Successor Agent  

        If an Agent gives notice of its resignation or its appointment is terminated pursuant to Clause 0 (Resignation and
Termination), then Citibank NA shall be appointed the successor Agent unless it, in its sole discretion, declines to do so, in which case, following consultation with the
Parent, any reputable and experienced bank or other financial institution may be appointed as a successor to the Agent by an Instructing Group during the period of such notice but, if no such
successor is so appointed, the Agent may appoint such a successor itself. 

Rights and Obligations  

        If a successor to an Agent is appointed under the provisions of Clause 0 (Successor Agent), then
(a) the retiring Agent shall be discharged from any further obligation under the Finance Documents but shall remain entitled to the benefit of the provisions of this Clause 0 and
(b) its successor and each 

53

 

of
the other parties hereto shall have the same rights and obligations amongst themselves as they would have had if such successor had been a party hereto. 

Own Responsibility  

        It is understood and agreed by each Bank that it has itself been, and will continue to be, solely responsible for making its own independent appraisal of and
investigations into the financial condition, creditworthiness, condition, affairs, status and nature of each member of the Group and, accordingly, each Bank warrants to the Agents, the Mandated Lead
Arrangers and the Co-Arrangers that it has not relied on and will not hereafter rely on the Agents, the Mandated Lead Arrangers, the Co-Arrangers or any of them: 

        to check or enquire on its behalf into the adequacy, accuracy or completeness of any information provided by any of the Obligors in connection with the Finance
Documents or the transactions contemplated in the Finance Documents (whether or not such information has been or is hereafter
circulated to such Bank by the Agents, the Mandated Lead Arrangers and the Co-Arrangers or any of them); or

        to assess or keep under review on its behalf the financial condition, creditworthiness, condition, affairs, status or nature of any member of the
Group.

Agency Division Separate  

        In acting as agent hereunder for the Banks, each Agent shall be regarded as acting through its agency division which shall be treated as a separate entity from
any other of its divisions or departments and, notwithstanding the foregoing provisions of this Clause 0, any information received by some other division or department of that Agent may be
treated as confidential and shall not be regarded as having been given to that Agent's agency division. 

Confidential Information  

        Notwithstanding anything to the contrary expressed or implied herein and without prejudice to the provisions of Clause 0
(Agency Division Separate), neither Agent shall as between itself and the Banks be bound to disclose to any Bank or other person any information which
is supplied by any member of the Group to the Agents other than in their capacity as Agents under the Finance Documents.

        Notwithstanding any of the provisions of this Agreement, the Obligors and the Finance Parties hereby agree that each party hereto and each employee,
representative or other agent of each party hereto may disclose to any and all persons, without limitation of any kind, the US tax treatment and US tax structure of the transaction and any materials
of any kind (including opinions or other tax analyses) that are provided to each party relating to such US tax treatment and US tax structure other than any information for which
non-disclosure is reasonably necessary in order to apply with applicable securities laws. Any Obligor which makes a disclosure under this Clause shall promptly inform the Facility Agent of
such disclosure and any Finance Party which makes a disclosure under this Clause shall promptly inform the Parent of such disclosure.

Security Documents  

        Neither Agent shall be liable for any failure, omission or defect in perfecting the security constituted by any Security Document or any
security created thereby including, without limitation, any failure at any time to effect or procure registration or notification of or otherwise protect any security created by or pursuant to the
Security Documents under any registration or other laws in any jurisdiction.

54

 

        The Agents may accept without enquiry such title as any party may have to the property over which security is intended to be created by the Security
Documents.

        Save as otherwise provided by the Finance Documents, neither Agent shall be under an obligation to hold any title deeds or any other documents in connection with
the property charged by or subject to the Security Documents or any other such security in its own possession or to take any steps to protect or preserve the same. Each Agent may permit the relevant
party to retain all such title deeds and other documents in its possession.

        Without prejudice to the foregoing, each Bank hereby confirms its approval of the Security Documents and any security created or to be created pursuant thereto
and hereby authorises, empowers and directs the Security Agent (by itself or by such person(s) as it may nominate) to enforce the same and hereby authorises, empowers and directs the Security Agent to
sign the same on its behalf.

 
 

Assignments and Transfers    
    

Binding Agreement  

        This Agreement shall be binding upon and enure to the benefit of each party hereto and its or any subsequent successors, Transferees and assigns. 

No Assignments and Transfers by the Obligors  

        None of the Obligors shall be entitled to assign or transfer all or any of its rights, benefits and obligations hereunder. 

Assignment to Federal Reserve Bank  

        In addition to any other assignments or participation rights provided in this Clause 0, each Bank may assign and pledge all or any portion of its
outstanding Advances and the other obligations owed to such Bank, without notice to or consent of any Party, to any Federal Reserve Bank pursuant to Regulation A of the Board of Governors of
any Federal Reserve Bank and any operating circular issued by any Federal Reserve Bank; provided, however, that, (i) no Bank shall be relieved of
any of its obligations under this Agreement as a result of any such assignment and pledge and (ii) in no event shall any Federal Reserve Bank be considered to be a "Bank" or be entitled to
require the assigning Bank to take or omit to take any action under this Agreement. 

Assignments and Transfers by Banks  

        Any Bank may, at any time, assign, in accordance with Clause 0 (Assignments by Banks) all or any of its
rights and benefits hereunder or transfer in accordance with Clause 0 (Transfers by Banks) all or any of its rights, benefits and obligations
hereunder pro rata as between Facility A and Facility B to any Qualifying Bank provided that (save in the case of any such assignment or transfer
(a) to any subsidiary or holding company, or to any subsidiary of any holding company, of such Bank, provided that, for so long as it is a
requirement of Dutch law that each Bank is a PMP, such subsidiary or holding company or subsidiary of any holding company is a PMP, (b) to any other Bank or (c) if an Event of Default
has occurred which is continuing), no such assignment or transfer may be made without the prior written consent of the Parent, such consent not to be unreasonably withheld or delayed and being deemed
to be given if not refused within 10 business days of request for consent having been received by the Parent. If, including in the case of (a) above, the Parent is not satisfied that the
proposed assignee or Transferee qualifies as a PMP this will be reasonable grounds for the Parent to withhold consent provided that it is a requirement under Dutch law at the time of such assignment
or transfer that the assignee or Transferee qualifies as a PMP. If the assigning or transferring Bank or proposed assignee or Transferee provides the Parent with evidence that such proposed assignee
or Transferee qualifies as a 

55

 

PMP
the Parent will be deemed to have consented to such assignment or transfer unless it objects to such evidence within 10 business days of receipt thereof. 

Transfers after an Event of Default  

        At any time after an Event of Default has occurred and is continuing, and whilst it is a requirement of Dutch law that each Bank is a PMP,
notwithstanding that the Parent may not be required to consent under Clause 0(c) to any proposed assignment or transfer, the Parent may, within ten business days of receipt of the relevant
notice from the relevant Bank under Clause 0, object to such assignment or transfer by notice in writing to the Bank wishing to effect such assignment or transfer if it is not satisfied that
the relevant assignee or transferee is a PMP;

        If no such objection is received by the relevant Bank within such ten business day period the relevant Bank shall be entitled to proceed with such assignment or
transfer;

        If such an objection is received during such ten business day period the relevant Bank shall not be entitled to proceed with such assignment or transfer unless
the assigning or transferring Bank or proposed assignee or Transferee provides the Parent with evidence that such proposed assignee or
Transferee qualifies as a PMP in which case the Parent will be deemed to have consented to such assignment or transfer unless it objects to such evidence within 10 business days of receipt
thereof.

Dutch PMP Verification  

        For so long as it is a requirement of Dutch law that each Bank is a PMP and that the Dutch Borrower must verify the PMP status of a Transferee, a proposed
Transferee which is not a Verifiable PMP shall provide the Dutch Borrower, through the Facility Agent, with information in respect of itself reasonably requested by the Dutch Borrower with a view to
enabling the Dutch Borrower to verify its PMP status at least five business days prior to the proposed Transfer Date in relation to any assignment or transfer pursuant to which it would become a Bank
hereunder. 

Assignments by Banks  

        If any Bank assigns all or any of its rights and benefits hereunder in accordance with Clause 0 (Assignments and Transfers by
Banks), then, unless and until the assignee has agreed with the Facility Agent, the Mandated Lead Arrangers, the Co-Arrangers and the other Banks that it shall be
under the same obligations towards each of them as it would have been under if it had been an original party hereto as a Bank (whereupon such assignee shall become a party hereto as a
"Bank"), the Facility Agent, the Mandated Lead Arrangers, the Co-Arrangers and the other Banks shall not be obliged to recognise such
assignee as having the rights against each of them which it would have had if it had been such a party hereto. 

Transfers by Banks  

        If any Bank wishes to transfer all or any of its rights, benefits and/or obligations hereunder as contemplated in Clause 0
(Assignments and Transfers by Banks), then such transfer may be effected by the delivery to the Facility Agent of a duly completed and duly executed
Transfer Certificate (in four executed originals) in which event, on the later of the Transfer Date specified in such Transfer Certificate and the fifth business day after (or such earlier business
day endorsed by the Facility Agent on such Transfer Certificate falling on or after) the date of delivery of such Transfer Certificate to the Facility Agent: 

        to the extent that in such Transfer Certificate the Bank party thereto seeks to transfer its rights, benefits and obligations hereunder, each of the Obligors and
such Bank shall be released from further obligations towards one another hereunder and their respective rights against one another shall be  

56

 

 cancelled (such rights and obligations being referred to in this Clause 0 as "discharged rights and obligations");

        each of the Obligors and the Transferee party thereto shall assume obligations towards one another and/or acquire rights against one another which differ from
such discharged rights and obligations only insofar as such Obligor and such Transferee have assumed and/or acquired the same in place of such Obligor and such Bank;

        the Facility Agent, the Mandated Lead Arrangers, the Co-Arrangers, such Transferee and the other Banks shall acquire the same rights and benefits and
assume the same obligations between themselves as they would have acquired and assumed had such Transferee been an original party hereto as a Bank with the rights, benefits and/or obligations acquired
or assumed by it as a result of such transfer; and

        such Transferee shall, if not already a Bank, become a party hereto as a "Bank".

Transfer Fees  

        On the date upon which a transfer takes effect pursuant to Clause 0 (Transfers by Banks) the Transferee in
respect of such transfer shall pay to the Facility Agent for its own account a transfer fee of €1000. 

Additional Costs  

        If any assignment or transfer by a Bank would, in the circumstances applicable at the time thereof, result in additional amounts becoming payable under
Clause 0 (Taxes), the relevant Obligor shall be required to pay such amounts or additional amounts to or for the account of the assignee or
transferee only to the extent that it would have been required to pay the same had there been no such assignment or transfer. 

Disclosure of Information  

        Each Bank agrees that it will (including after it ceases to be a Bank) keep confidential all information relating to the Obligors
furnished to it by or on behalf of the Obligors under this Agreement.

        Notwithstanding sub-clause 0 above, the Mandated Lead Arrangers and the Co-Arrangers shall continue to be bound by the
confidentiality undertakings given by them to the Parent prior to the date of, and in connection with, this Agreement.

        Notwithstanding sub-clause 0 above, a Bank may disclose to any person with whom it is proposing to enter, or has entered into, any kind of
assignment, transfer or sub-participation or other agreement in relation to this Agreement:

        a copy of any Finance Document;  

        a copy of the Information Memorandum; and  

        any other information furnished to it hereunder or in connection herewith,  

        provided that it has obtained from that person a confidentiality undertaking in substantially the same form as
this Clause 0. 

        Notwithstanding sub-clause 0 above, each Bank may disclose any information furnished under or in connection with, or concerning, this
Agreement, and a copy of any Finance Document:

        to any person where disclosure is required by any applicable law or regulation;  

        to its legal, financial and other professional advisers and to its auditors on a confidential basis;

57

 

        in connection with legal proceedings relating to any Finance Document; and  

        to any other third party with the consent of the Parent,  

        or if the relevant information is in the public domain. 

        No Bank is responsible to any Obligor for the consequences of disclosing any information to a third party in accordance with the provisions of this
Clause 0.

Professional Market Party Representations  

        Each Bank which is a party to this Agreement on the date hereof represents and warrants to each Party on the date hereof that it is a PMP
and if on the date on which a party becomes a Bank, it is a requirement of Dutch law that such party is a PMP, each such new Bank represents and warrants to each Party on the date on which it becomes
a party to this Agreement as a Bank that it is a PMP and each such Bank or Party acknowledges that each of the Finance Parties and the Borrower have relied upon such representation and
warranty.

Each Dutch Borrower:  

        represents and warrants to the Finance Parties on the date of this Agreement that it has verified the status of each person which is a
Bank under a Finance Document on such date and each such Bank is either (i) a PMP in accordance with the requirements of the Exemption Regulation and the Policy Guidelines and/or (ii) is
exempted from the PMP requirement because it forms a closed circle (besloten kring) with the Borrower; and

        if on the date on which a party becomes a Bank, it is a requirement of Dutch law that such party is a PMP, represents and warrants to the Finance Parties on the
date on which each such party becomes a Bank that it has verified the status of such party on such date and each such party is either (i) a PMP in accordance with the requirements of the
Exemption Regulation and the Policy Guidelines and/or (ii) is exempted from the PMP requirement because it forms a closed circle (besloten kring) with the Borrower.

 
 

Calculations and Evidence of Debt    
    

Basis of Accrual  

        Interest (including any applicable Mandatory Cost) and commitment commission and utilisation fees shall accrue from day to day and shall be calculated on the
basis of a year of 360 days (or, in any case where market practice differs, in accordance with market practice) and the actual number of days elapsed. 

Proportionate Reductions  

        Any repayment of an Advance denominated in an Optional Currency shall reduce the amount of such Advance by the amount of such Optional Currency repaid and shall
reduce the Euro Amount of such Advance proportionately. 

Quotations  

        If on any occasion a Reference Bank or Bank fails to supply the Facility Agent with a quotation required of it under the foregoing provisions of this Agreement,
the rate for which such quotation was required shall be determined from those quotations which are supplied to the Facility Agent. 

58

 

Evidence of Debt  

        Each Bank shall maintain in accordance with its usual practice accounts evidencing the amounts from time to time lent by and owing to it hereunder. 

Control Accounts  

        The Facility Agent shall maintain on its books a control account or accounts in which shall be recorded: 

        the amount of any Advance made or arising hereunder and each Bank's share therein;

        the amount of all principal, interest and other sums due or to become due from any of the Obligors to any of the Banks hereunder and each Bank's share therein;
and  

        the amount of any sum received or recovered by the Facility Agent hereunder and each Bank's share therein.

Prima Facie Evidence  

        In any legal action or proceeding arising out of or in connection with this Agreement, the entries made in the accounts maintained pursuant to Clause 0
(Evidence of Debt) and Clause 0 (Control Accounts) shall be prima
facie evidence of the existence and amounts of the specified obligations of the Obligors. 

Certificates of Banks  

        A certificate of a Bank as to: 

        the amount by which a sum payable to it hereunder is to be increased under Clause 0 (Tax
Gross-up); or  

        the amount for the time being required to indemnify it against any such cost, payment or liability as is mentioned in Clause 0
(Tax Indemnity) or Clause 0 (Increased Costs)

        shall
be prima facie evidence of the existence and amounts of the specified obligations of the Obligors. 

Facility Agent's Certificates  

        A certificate of the Facility Agent as to the amount at any time due from any of the Borrowers hereunder or the amount which, but for any of the obligations of
any of the Borrowers hereunder being or becoming void, voidable, unenforceable or ineffective, at any time would have been due from such Borrower hereunder shall be prima facie evidence for the
purposes of Clause 0 (Guarantee and Indemnity). 

 
 

Remedies and Waivers, Partial Invalidity    
    

Remedies and Waivers  

        No failure to exercise, nor any delay in exercising, on the part of the Facility Agent, the Mandated Lead Arrangers, the Co-Arrangers and the Banks or
any of them, any right or remedy hereunder shall operate as a waiver thereof, nor shall any single or partial exercise of any right or remedy prevent any further or other exercise thereof or the
exercise of any other right or remedy. The rights and remedies herein provided are cumulative and not exclusive of any rights or remedies provided by law. 

59

 

Partial Invalidity  

        If, at any time, any provision hereof is or becomes illegal, invalid or unenforceable in any respect under the law of any jurisdiction, neither the legality,
validity or enforceability of the remaining provisions hereof nor the legality, validity or enforceability of such provision under the law of any other jurisdiction shall in any way be affected or
impaired thereby. 

 
 

Notices and Counterparts    
    

Giving of notices  

        All notices or other communications under or in connection with the Finance Documents shall be given in writing and, unless otherwise stated, may be made by
letter or facsimile. Any such notice will be deemed to be given as follows: 

        if by letter, when delivered personally or on actual receipt; and  

        if by facsimile, when received in legible form.  

        However, a notice given in accordance with the above but received on a non-working day or after business hours in the place of receipt will only be
deemed to be given on the next working day in that place. 

Addresses for notices  

        The address and facsimile number of each person (other than the Borrowers' Agent and the Facility Agent) for all notices under or in
connection with the Finance Documents are:

        those notified by that person for this purpose to the Facility Agent (or in the case of a Transferee, at the end of the Transfer Certificate to which it is a
party as Transferee); or

        any other notified by that person for this purpose to the Facility Agent by not less than five business days' notice.

 The address and facsimile number of the Borrowers' Agent are:  

GUCCI
LUXEMBOURG S.A., Lussemburgo, succursale Euro Financial Investments di Cadempino

Via Industria

TI 6814—CADEMPINO (Ticino)

Switzerland

Fax: +41 91 805 2225

Attn: Luca Carnevali 

or
such other as the Borrowers' Agent may notify to the Facility Agent by not less than five business days' notice. 

 The address and facsimile number of the Facility Agent:  

UNICREDITO
ITALIANO S.p.A., London Branch

17 Moorgate

London EC2R 6PH

Fax: +44 20 7606 3920

Attn: Ian King 

or
such other as the Facility Agent may notify to the other parties to this Agreement by not less than five business days' notice. 

60

 

        All notices from or to an Obligor shall be sent through the Facility Agent and the Borrowers' Agent.

English Language  

        Each communication and document made or delivered by one party to another pursuant to this Agreement shall be in the English language or unless the Facility Agent
otherwise agrees, accompanied by a translation thereof into English certified (by an officer of the person making or delivering the same) as being a true and accurate translation thereof. 

Counterparts  

        This Agreement may be executed in any number of counterparts and by different parties on different counterparts, all of which taken together shall constitute one
and the same instrument. 

 
 

Amendments and Additional Borrowers and Guarantors    
    

Amendment Procedures  

        The Facility Agent, if it has the prior written consent of an Instructing Group (other than in the case of an amendment necessary to correct a manifest error,
when such consent shall not be required), and the Borrowers' Agent may from time to time agree in writing to amend this Agreement or to waive, prospectively or retrospectively, any of the requirements
of this Agreement and any amendments or
waivers so agreed shall be binding on all the Banks, the Mandated Lead Arrangers, the Co-Arrangers and the Obligors provided that: 

        no such waiver or amendment shall subject any party hereto to any new or additional obligations without the consent of such party;

        without the prior written consent of all the Banks, no such amendment or waiver shall:

        amend or waive any provision of Clause 0 (Sharing), Clause 0 (No Assignments
and Transfers by the Obligors), Clause 0 (Assignments and Transfers by Banks) or this
Clause 0;

        reduce the proportion of any amount received or recovered (whether by way of set-off, combination of accounts or otherwise) in respect of any amount
due from any of the Obligors under the Finance Documents to which any Bank is entitled;

        change the principal amount of or currency of any Advance, or defer the term of the Facilities or any Term of any Advance;

        change the Margin or change the amount or currency or defer the date for any payment of interest, fees or any other amount payable hereunder to all or any of the
Agents, the Mandated Lead Arrangers, the Co-Arrangers and the Banks;

        increase any Bank's Commitment;  

        amend the definition of Instructing Group; or amend any provision which contemplates the need for the consent or approval of all the
Banks; and  

        notwithstanding any other provisions hereof, the Agent shall not be obliged to agree to any such amendment or waiver if the same
would:

        amend or waive any provision of this Clause 0, Clause 23 (Costs and Expenses) or Clause 0
(The Agents, the Mandated Lead Arrangers, the Co-Arrangers and the Banks); or  

        otherwise amend or waive any of the Agents' rights hereunder or subject the Agents, the Mandated Lead Arrangers or the
Co-Arrangers to any additional obligations hereunder.

61

  

Amendment Costs  

        If any of the Obligors requests any amendment or waiver in accordance with Clause 0 (Amendment Procedures)
then the Borrower shall, on demand of the Facility Agent, reimburse the Agents, the Mandated Lead Arrangers, the Co-Arrangers and the Banks for all costs and expenses (including legal
fees) together with any VAT thereon incurred by the Agents, the Mandated Lead Arrangers, the Co-Arrangers and the Banks in responding to or complying with such request. 

Additional Borrowers  

        Upon delivery of a duly executed Borrower Accession Memorandum, any member of the Group shall, subject to the terms and conditions of this Agreement, acquire all
the rights and assume all the obligations of a Borrower hereunder provided that: 

        each of the Banks agrees to the choice of such entity as an additional Borrower and the Facility Agent has notified the Borrowers' Agent of the same; and  

        the Facility Agent has confirmed to the Borrowers' Agent that it has received, in a form satisfactory to it, all the documents set out in
Part B (Documents to Accompany Borrower Accession Memorandum) of Schedule 5 (Additional
Borrowers).

        Each
Guarantor hereby irrevocably appoints the Parent as its agent to enter into each Borrower Accession Memorandum on its behalf and agrees to be bound by the terms thereof and in
particular that its guarantee in accordance with Clause 0 (Guarantee and Indemnity) shall notwithstanding the entering into of any Borrower
Accession Memorandum continue to exist and shall include a guarantee of the obligations of any additional Borrower appointed thereunder. 

Additional Guarantors  

The Parent shall ensure that:  

        prior to the repayment and/or cancellation in full of the Existing Facility, on the basis set out in this Clause 0, that at the end
of each of its financial years and the end of each half of its financial years the aggregate total Asset Value of the Guarantors under this Agreement represents not less than 85 per cent. of the total
Asset Value of the Group (the "85% Asset Test");

        on and following the irrevocable cancellation and prepayment in full of the Existing Facility, on the basis set out in this Clause 0, that at the end of
each of its financial years and the end of each half of its financial years the aggregate total EBIT of the Guarantors under this Agreement represents not less than 85 per cent of the Group (the
"EBIT Test"),

        provided that in any event at all times Gucci Group N.V., Gucci International N.V., Gucci Luxembourg S.A. and, at all times on or after
the cancellation and/or repayment in full of the Existing Facility, Guccio Gucci S.p.A. shall be Guarantors. The 85% Asset Test or the EBIT Test, as appropriate, shall be met also immediately after
the removal of any Guarantor permitted by Clause 0 (Removal of Guarantors). Both the 85% Asset Test and the EBIT Test will be based on each
member of the Group's financial information for the relevant period, consisting of the balance sheet and the income statement only, based on special purpose standard forms specifically prepared by
each member of the Group's solely in order to enable the Parent to prepare its audited consolidated financial statements in accordance with International Accounting Standards. 

        The 85% Asset Test will be performed by calculating the ratio between the consolidated Asset Value of the Guarantors ("Numerator") and the Asset Value of the
Group ("Denominator") as follows:

        the Denominator shall be the Asset Value as reported in the consolidated financial statements of Gucci Group N.V., adjusted to include the Asset Value of those
members of the Group, which are  

62

 

 subsidiaries (but not wholly-owned subsidiaries) of the Group, only to the extent of the Group's ownership interest in those subsidiaries;

the Numerator shall be calculated as follows:  

        the receivable balances of a Guarantor towards a subsidiary (either wholly owned or not wholly owned) not being a Guarantor will be
included in the Asset Value of such Guarantor;

        the Asset Value of a Guarantor will be calculated without taking into account any Asset Value of such Guarantor attributable to any of its subsidiaries or the
Asset Value of the shares held by such Guarantor therein. Notwithstanding the provision contained in this paragraph, the Asset Value of any member of the Group, which is a subsidiary (but not a
wholly-owned subsidiary) of a Guarantor, will be included among the Asset Value of such Guarantor, but only to the extent of the Group's ownership interest in that subsidiary;
and

        the Asset Value of a Guarantor will include, if any, the value of those intangibles (trademarks and goodwill) which are included in the Denominator and represent
the portion of the purchase price paid by the Group for an acquired subsidiary (or group of subsidiaries), to the extent such purchase price has been allocated to trademark or to goodwill, when such
purchase price has been ultimately paid by such Guarantor and such subsidiary is ultimately held by such Guarantor.

        The EBIT Test will be performed by calculating the ratio between the aggregate total consolidated EBIT of the Guarantors and the aggregate total EBIT of the
Group.

        In the event that either the 85% Asset Test or, as the case may be, the EBIT Test are not met, the Parent shall:

        subject to sub-clause 0, within 30 days of delivery of the relevant compliance certificate to the Facility Agent under
sub-clause 0; or  

        within 30 days of delivery to the Facility Agent of the certificate referred to in
sub-clause 0,

        procure
that further members of the Group will become additional Guarantors by delivery of a duly executed Guarantor Accession Memorandum. 

        Upon delivery of a duly executed Guarantor Accession Memorandum, the relevant member of the Group will become an additional Guarantor and, unless otherwise agreed
by the Facility Agent, the
Parent shall procure that the relevant member of the Group delivers to the Facility Agent, in a form satisfactory to the Facility Agent, all the documents set out in Part B
(Documents to Accompany Guarantor Accession Memorandum) of Schedule 6 (Additional Guarantors)
within 5 days of the date of such Guarantor Accession Memorandum.

        If an additional Guarantor is a member of the Group incorporated in a jurisdiction in which there is a Guarantor on the date of this Agreement (an
"Existing Guarantor"), on becoming an additional Guarantor it shall give the same additional representations, warranties and undertakings, as to itself,
and shall have the benefit of the same limitations, restrictions and exclusions (if any) as are applicable to that Existing Guarantor, and the same additional Events of Default (if any) as apply to
that Existing Guarantor shall also apply to it.

If either:  

        the Parent demonstrates to the satisfaction of the Facility Agent that it is illegal for the relevant member of the Group to give a
guarantee on the terms of Clause 0 (Guarantee and Indemnity); or

        an Event of Default or breach of representation would result from the relevant member of the Group becoming a Guarantor and an Instructing Group has not agreed to
amendments to this  

63

 

 Agreement in relation to that member of the Group which would prevent such Event of Default or breach of representation occurring,

        a
pledge of the shares of that member of the Group shall, within the period referred to in sub-clause 0 above be executed in favour of the Banks as security for the
Obligors' obligations under this Agreement in place of the relevant guarantee. 

        If the Parent demonstrates to the satisfaction of the Facility Agent that it is illegal for the relevant member of the Group to give a pledge of its shares
pursuant to sub-clause 0 above (but without prejudice to the foregoing provisions of this Clause 0 (and the occurrence of an Event of Default) if no agreement is
reached):

        the Parent and the Facility Agent shall enter into negotiations for a period of not more than 90 days with a view to agreeing alternative provision of
security which may include, without limitation, a
guarantee or a pledge of shares from the parent of the relevant member of the Group or asset security from another member of the Group, in each case acceptable to an Instructing
Group;

        if agreement is reached, the relevant guarantee or other security will be executed within 15 days of agreement.

        The Parent will procure that all necessary registrations, filings, notifications and notarisations in relation to any security given pursuant to this
Clause 0 are made and will be responsible for all fees and charges and expenses in relation thereto.

Original Guarantors  

        The Parent shall procure that as soon as reasonably practicable after the date of this Agreement each Original Guarantor becomes a
Guarantor.

        An Original Guarantor will become a Guarantor upon the Facility Agent confirming to the Borrower's Agent that it has received (each in form and substance
satisfactory to the Facility Agent):

	(a)
	a
duly executed Original Guarantor Accession Memorandum in respect of such Original Guarantor;

	(b)
	all
the documents set out in Part 1 of Schedule 3 (Condition Precedent Documents), at numbers 1 to 5, 17 to 18 and 21;
and

	(c)
	a
legal opinion from the legal advisors to the Facility Agent in the jurisdiction of incorporation of such Original Guarantor as required by Part 1 of Schedule 3
(Condition Precedent Documents) at numbers 6 to 15. 

Removal of Guarantors  

        If it is intended that a Guarantor, not being a Core Guarantor, (the "Relevant Guarantor")
enters into a transaction whereby it will no longer be a wholly-owned subsidiary of the Parent or whereby it is to merge with a company outside the Group but after which such Relevant Guarantor will
still be a wholly-owned subsidiary of the Parent; and

        a certificate issued by the chief financial officer of the Parent is delivered to the Facility Agent certifying that within 30 days of the completion of
the transaction the 85% Asset Test or the EBIT Test, as the case may be, will, notwithstanding the transaction or the Relevant Guarantor ceasing to be a Guarantor, be met by:

        the remaining Guarantors; or  

        (where the Relevant Guarantor is no longer a wholly-owned subsidiary of the Parent after the transaction, but any member of the Group
retains a shareholding in the Relevant Guarantor or in another  

64

 

 company (which is itself not a wholly-owned subsidiary of the Parent) in which the Group has acquired an interest as part of the transaction contemplated in sub-paragraph 00 above)
the provision of an additional guarantee from the member of the Group which is the immediate shareholder of that Relevant Guarantor or that company; or

        to the extent additional guarantees are required (after the operation of sub-paragraph 000 above (if applicable)), the provision of guarantees
from the Relevant Guarantor, if it is a wholly-owned subsidiary of the Parent immediately after the merger referred to in sub-paragraph 00 above and/or from other members of the
Group, in each case in accordance with sub-clause 0 of Clause 0 (Additional Guarantors),

        (as
detailed in the certificate), the Parent may request the release of the Relevant Guarantor as a Guarantor under this Agreement. 

        On the delivery to the Facility Agent of the certificate referred to in sub-paragraph 0 above, the Facility Agent will, at the expense of the
Parent, release the Relevant Guarantor from its obligations as a Guarantor under this Agreement and from this Agreement (and each of the Banks
and the Security Agent irrevocably authorises the Facility Agent to execute any documentation necessary to effect the release).

 
 

Law and Jurisdiction    
    

English Law  

        This Agreement shall be governed by, and shall be construed in accordance with, English law. 

English Courts  

        Each of the parties hereto irrevocably agrees for the benefit of each of the Agents, the Mandated Lead Arrangers, the Co-Arrangers and the Banks that
the courts of England shall have jurisdiction to hear and determine any suit, action or proceedings, and to settle any disputes, which may arise out of or in connection with this Agreement
(respectively "Proceedings" and "Disputes") and, for such purposes, each of the Obligors irrevocably
submits to the jurisdiction of such courts. 

New York Courts  

        Without prejudice to Clause 0 (English Courts) and for the benefit of each of the Agents, the Mandated Lead
Arrangers, the Co-Arrangers and the Banks, each of the Obligors irrevocably agrees that the courts of the State of New York and the courts of the United States of America, in each case
sitting in the County of New York, shall have jurisdiction to hear and determine any Proceedings and to settle any Disputes and, for such purposes, irrevocably submits to the jurisdiction of such
courts. 

Appropriate Forum  

        Each of the Obligors irrevocably waives any objection which it might now or hereafter have to the courts referred to in Clause 0
(English Courts) and 0 (New York Courts) being nominated as the forum to hear and determine any
Proceedings and to settle any Disputes and agrees not to claim that any such court is not a convenient or appropriate forum. 

Service of Process  

        Each of the Obligors agrees that the process by which any Proceedings are begun may be served on it by being delivered in connection with any Proceedings in
(a) England, to Gucci Services Limited at 4 Grafton Street, London W1X 3LB or other its registered office for the time being and (b) in connection with any Proceedings in New York, to
Gucci America, Inc. at 50 Hartz Way Secaurus, New Jersey 07094 or other its principal place of business in New York for the time being. If the appointment 

65

 

of
the person mentioned in this Clause 0 ceases to be effective in respect of any of the Obligors, such Obligor or Obligors shall immediately appoint a further person in England or, as the case
may be, New York to accept service of process on its behalf in England or, as the case may be, New York and, failing such appointment within 15 days, the Facility Agent shall be entitled to
appoint such a person by notice to such Obligor or Obligors. Nothing contained herein shall affect the right to serve process in any other manner permitted by law. 

Non-exclusive Submissions  

        The submission to the jurisdiction of the courts referred to in Clause 0 (English Courts) and 0
(New York Courts) shall not (and shall not be construed so as to) limit the right of the Agents, the Mandated Lead Arrangers, the
Co-Arrangers and the Banks or any of them to take Proceedings against any of the Obligors in any other court of competent jurisdiction nor shall the taking of Proceedings in any one or
more jurisdictions preclude the taking of Proceedings in any other jurisdiction (whether concurrently or not) if and to the extent permitted by applicable law. 

Consent to Enforcement  

        Each of the Obligors hereby consents generally in respect of any Proceedings to the giving of any relief or the issue of any process in connection with such
Proceedings including the making, enforcement or execution against any property whatsoever (irrespective of its use or intended use) of any order or judgment which may be made or given in such
Proceedings. 

Waiver of Immunity  

        To the extent that any of the Obligors may in any jurisdiction claim for itself or its assets immunity from suit, execution, attachment (whether in aid of
execution, before judgment or otherwise) or other legal process and to the extent that in any such jurisdiction there may be attributed to itself or its assets such immunity (whether or not claimed),
such Obligor hereby irrevocably agrees not to claim and hereby irrevocably waives such immunity to the full extent permitted by the laws of such jurisdiction and, in particular, to the intent that in
any proceedings taken in New York, the foregoing waiver of immunity shall have effect under and be construed in accordance with the United States Foreign Sovereign Immunities Act of 1976. 

Waiver of Trial by Jury  

        Each of the parties hereto hereby waives trial by jury in connection with any judicial proceeding involving, directly or indirectly, any
matter in any way arising out of, related to, or connected with the Finance Documents or the relationships established thereunder. Each of the Obligors agrees that this Clause 0 is a specific
and material aspect of this Agreement and acknowledges that the Banks would not extend to the Borrowers any financial accommodations hereunder if this Clause 0 were not part of this Agreement.
In addition, in any such Proceedings, each Obligor hereby expressly waives any and all rights it may have to claim or recover any punitive, exemplary, special, incidental or consequential
damages.

        Each US Obligor agrees that the Finance Documents contain the complete agreement between the parties on the matters to which they relate and supersede all prior
commitments, agreements and understandings, whether written or oral, on those matters.

        THIS
AGREEMENT has been entered into on the date stated at the beginning of this Agreement. 

66

 

 
 

The Banks and Commitments    
    

 
 

(i)-1
  Facility A Commitments    
    

	Banks
 
	 	Commitment

€

	Banca Popolare di Milano S.C.a R.L.	 	20,000,000
	Citibank NA, London	 	20,000,000
	ING Bank N.V.—Milan Branch	 	20,000,000
	Mizuho Corporate Bank, Ltd	 	20,000,000
	SANPAOLO IMI S.P.A.—Divisione Imprese	 	20,000,000
	The Royal Bank of Scotland plc, Milan Branch	 	20,000,000
	UniCredito Italiano S.p.A., London Branch	 	20,000,000
	ABN AMRO Bank N.V.—Milan Branch	 	10,000,000
	Banca di Roma SPA	 	10,000,000
	BANCA INTESA SPA—CENTRO CORPORATE DI FIRENZE	 	10,000,000
	Banco Popolare di Verona e Novara (Luxembourg) S.A.	 	10,000,000
	BIPOP CARIRE, Società per Azioni	 	10,000,000
	BNP PARIBAS S.A.	 	10,000,000
	BANCA C.R. FIRENZE—Centro Imprese Firenze Ovest	 	10,000,000
	WestLB Ireland Plc	 	10,000,000
	Banca Toscana S.p.A.	 	6,000,000
	Banca Monte dei Paschi di Siena S.p.A.	 	4,000,000
	 	 	

	 	Total Facility A Commitments	 	€230,000,000
	 	 	

67

 
 
 

(ii)-1
  Facility B Commitments    
    

	Banks
 
	 	Commitment

€

	Banca Popolare di Milano S.C.a R.L.	 	20,000,000
	Citibank NA, London	 	20,000,000
	ING Bank N.V.—Milan Branch	 	20,000,000
	Mizuho Corporate Bank, Ltd	 	20,000,000
	SANPAOLO IMI S.P.A.—Divisione Imprese	 	20,000,000
	The Royal Bank of Scotland plc, Milan Branch	 	20,000,000
	UniCredito Italiano S.p.A., London Branch	 	20,000,000
	ABN AMRO Bank N.V.—Milan Branch	 	10,000,000
	Banca di Roma SPA	 	10,000,000
	BANCA INTESA SPA—CENTRO CORPORATE DI FIRENZE	 	10,000,000
	Banco Popolare di Verona e Novora (Luxembourg) S.A.	 	10,000,000
	BIPOP CARIRE, Società per Azioni	 	10,000,000
	BNP PARIBAS S.A.	 	10,000,000
	BANCA C.R. FIRENZE—Centro Imprese Firenze Ovest	 	10,000,000
	WestLB Ireland Plc	 	10,000,000
	Banca Toscana S.p.A.	 	6,000,000
	Banca Monte dei Paschi di Siena S.p.A.	 	4,000,000
	 	 	

	 	Total Facility B Commitments	 	€230,000,000
	 	 	

68

 

 
 

Form of Transfer Certificate    
    

        To: [UNICREDITO ITALIANO S.p.A., London Branch] 

 
 

TRANSFER CERTIFICATE    
    

        relating to the agreement (as from time to time amended, varied, novated or supplemented, the "Facility
Agreement") dated 28 November 2003 whereby €460,000,000 multicurrency revolving credit facilities were made available to Gucci Group N.V. and others as
borrowers under the guarantee of Gucci Group N.V. and others as guarantors by a group of banks on whose behalf UniCredito Italiano S.p.A., London Branch acted as agent in connection therewith. 

	1.
	Terms
defined in the Facility Agreement shall, subject to any contrary indication, have the same meanings herein. The terms Bank and Transferee are defined in the schedule hereto.

	2.
	The
Bank (i) confirms that the details in the schedule hereto under the heading "Bank's Commitment" or
"Advance(s)" accurately summarises its Facility A and Facility B Commitment and/or, as the case may be, its participation in, and the Term and Repayment
Date of, one or more existing Advances and (ii) requests the Transferee to accept and procure the transfer to the Transferee of the portion specified in the schedule hereto of, as the case may
be, its relevant Commitment and/or its participation in such Advance(s) by counter-signing and delivering this Transfer Certificate to the Facility Agent at its address for the service of notices
specified in the Facility Agreement.

	3.
	The
Transferee hereby requests the Facility Agent to accept this Transfer Certificate as being delivered to the Facility Agent pursuant to and for the purposes of Clause 0
(Transfers by Banks) of the Facility Agreement so as to take effect in accordance with the terms hereof on the Transfer Date or on such later date as
may be determined in accordance with the terms thereof.

	4.
	The
Transferee confirms that it has received a copy of the Facility Agreement together with such other information as it has required in connection with this transaction and that it
has not relied and will not hereafter rely on the Bank to check or enquire on its behalf into the legality, validity, effectiveness, adequacy, accuracy or completeness of any such information and
further agrees that it has not relied and will not rely on the Bank to assess or keep under review on its behalf the financial condition, creditworthiness, condition, affairs, status or nature or any
of the Borrowers or the Guarantors.

	5.
	The
Transferee hereby undertakes with the Bank and each of the other parties to the Facility Agreement that it will perform in accordance with their terms all those obligations which
by the terms of the Facility Agreement will be assumed by it after delivery of this Transfer Certificate to the Facility Agent and satisfaction of the conditions (if any) subject to which this
Transfer Certificate is expressed to take effect.

	6.
	The
Transferee confirms on the date on which it becomes a party to this Agreement that it is a PMP(1).

	7.
	The
Bank makes no representation or warranty and assumes no responsibility with respect to the legality, validity, effectiveness, adequacy or enforceability of the Facility Agreement
or any document relating thereto and assumes no responsibility for the financial condition of any of the Borrowers of the Guarantors or for the performance and observance by any of the Borrowers or
the Guarantors of any of its obligations under the Facility Agreement or any document relating thereto and any and all such conditions and warranties, whether express or implied by law or otherwise,
are hereby excluded.

	8.
	The
Bank hereby gives notice that nothing herein or in the Facility Agreement (or any document relating thereto) shall oblige the Bank to (a) accept a re-transfer
from the Transferee of the whole 

69

 

or
any part of its rights, benefits and/or obligations under the Facility Agreement transferred pursuant hereto or (b) support any losses directly or indirectly sustained or incurred by the
Transferee for any reason whatsoever including the non-performance by any of the Borrowers, the Guarantors or any other party to the Facility Agreement (or any document relating thereto)
of its obligations under any such document. The Transferee hereby acknowledges the absence of any such obligation as is referred to in (a) or (b) above. 

	9.
	This
Transfer Certificate and the rights, benefits and obligations of the parties hereunder shall be governed by and construed in accordance with English law.(2) 

 
 

THE SCHEDULE    
    

	1.
	Bank:

	2.
	Transferee:

	3.
	Transfer
Date:

	4.
	Commitments: 

Bank's
Facility A Commitment            Portion Transferred 

	(1)
	Only
to be included if it is a requirement under Dutch law at the time of such assignment or transfer, that the Transferee qualifies as PMP.

	(2)
	The
Transferee Bank may, in the case of a transfer of rights by the Transferor Bank under this Transfer Certificate, if it considers it necessary to make the transfer effective as
against third parties, arrange for it to be notified by way of signification to the French Obligors in accordance with article 1690 of the French  Code Civil.

Bank's
Facility B Commitment            Portion Transferred 

	5.
	Advance(s):

	Amount of Bank's Participation	 	Term and Repayment Date/ next Interest Payment Date	 	Portion Transferred

	[Transferor Bank]	 	[Transferee Bank]
	By:	 	By:
	Date:	 	Date:

70

  

 
 

Administrative Details of Transferee    
    

Address:

Contact Name:

Account for Payments in Euros:

[Telex]:

Telephone:

[NB Transferee Bank should notify Gucci Luxembourg S.A. of the transfer] 

 
 

Condition Precedent Documents    
    

 
 

Part 1    
    

	6.
	In
relation to each of the Obligors:

	(mm)
	a
copy of the constitutional documents of such Obligor; and

	(nn)
	a
copy of all necessary shareholder, directors, management or supervisory board resolutions (as applicable) of such Obligor approving the execution, delivery and performance of this
Agreement or an Original Guarantor Accession Memorandum, as the case may be and the terms and conditions hereof and authorising a named person or persons to sign this Agreement or an Original
Guarantor Accession Memorandum, as the case may be and any documents to be delivered by such Obligor pursuant thereto and/or authorising the issuance of a power of attorney to a named person or
persons to sign this Agreement or an Original Guarantor Accession Memorandum, as the case may be and any documents to be delivered by such Obligor pursuant thereto.

	7.
	A
certificate of an authorised signatory of the Parent setting out the names and signatures of the persons authorised to sign on behalf of each Obligor this Agreement or an Original
Guarantor Accession Memorandum, as the case may be and any documents to be delivered by each Obligor pursuant thereto.

	8.
	Copies
of the following official documents in relation to Obligors in particular countries:

	(oo)
	(The Netherlands) an excerpt from the trade register of the chamber of commerce of each Dutch Obligor;

	(pp)
	(France) a k. bis extract (extract k. bis) from the Register of Commerce and Companies
of Paris (as appropriate) in relation to each French Obligor;

	(qq)
	(Italy) a certificate (visura camerale) in respect of each Italian Obligor, issued by
the competent Italian Companies Registry;

	(rr)
	(Switzerland) a certified extract from the Registry of Commerce of the Canton of Neuchâtel in relation to Luxury
Timepieces International S.A., and a certified extract from the Registry of Commerce of the Canton of Ticino in relation to Luxury Goods International S.A.;

	(ss)
	(Japan) a certified copy of the Commercial Register in Japan in relation to each Japanese Obligor; and

	(tt)
	(USA) a certificate of the Secretary of State of each US Obligor's state of incorporation certifying the good standing of such US
Obligor.

	9.
	A
copy, certified a true copy by or on behalf of each Obligor, of each such law, decree, consent, licence, approval, registration or declaration as is, in the opinion of the Facility
Agent, necessary to render this Agreement legal, valid, binding and enforceable, to make this Agreement admissible in 

71

 

evidence
in each Obligor's jurisdiction of incorporation and to enable each of the Obligors to perform its obligations hereunder. 

	10.
	A
certificate of an authorised signatory of the Parent certifying that each copy document delivered under this Schedule 3 is correct, complete and in full force and effect as
at a date no earlier than the date of this Agreement.

	11.
	An
opinion of Clifford Chance, legal advisers in England to the Facility Agent, in substantially the form distributed to the Banks prior to the signing of this Agreement.

	12.
	An
opinion of Clifford Chance, legal advisers in the Netherlands to the Facility Agent, in substantially the form distributed to the Banks prior to the signing of this Agreement.

	13.
	An
opinion of Clifford Chance, legal advisers in Luxembourg to the Facility Agent, in substantially the form distributed to the Banks prior to the signing of this Agreement.

	14.
	An
opinion of Clifford Chance legal advisers in Italy to the Facility Agent, in substantially the form distributed to the Banks prior to the signing of this Agreement.

	15.
	An
opinion of Clifford Chance, legal advisers in New York to the Facility Agent, in substantially the form distributed to the Banks prior to the signing of this Agreement.

	16.
	An
opinion of Clifford Chance, legal advisers in France to the Facility Agent, in substantially the form distributed to the Banks prior to the signing of this Agreement.

	17.
	An
opinion of Clifford Chance, legal advisers in Hong Kong to the Facility Agent, in substantially the form distributed to the Banks prior to the signing of this Agreement.

	18.
	An
opinion of Clifford Chance, legal advisers in Delaware to the Facility Agent, in substantially the form distributed to the Banks prior to the signing of this Agreement.

	19.
	An
opinion of Nishimura & Partners, legal advisers in Japan to the Facility Agent, in substantially the form distributed to the Banks prior to the signing of this Agreement.

	20.
	An
opinion of Niederer, Kraft & Frey, legal advisers in Switzerland to the Facility Agent, in substantially the form distributed to the Banks prior to the signing of this
Agreement.

	21.
	A
copy of the Original Financial Statements of the Parent.

	22.
	Evidence
that Gucci Services Limited has agreed to act as the agent of the Obligors for service of process in England.

	23.
	Evidence
that Gucci America, Inc. has agreed to act as the agent of the Obligors for service of process in New York.

	24.
	Evidence
that the fees, costs and expenses then due from the Parent and/or the Borrowers pursuant to Clause 0 (Commitment Commission and
Fees) and Clause 0 (Costs and Expenses) have been paid or will be paid by or on the date of the first Advance hereunder.

	25.
	Confirmation
of each Dutch Obligor that there is no (central) works council ((centrale)  ondernemingsraad) with jurisdiction over the transactions as envisaged by this
Agreement or that all consultation obligations in respect of the
(central) works council with jurisdiction over the transactions as envisaged by this Agreement have been complied with and that positive advice has been obtained from such (central) works council.

	26.
	A
certificate evidencing that each US Obligor is solvent. 

72

 
 
 

Part A
  Notice of Drawdown    
    

	To:
	[UNICREDITO
ITALIANO S.p.A., London Branch] as Facility Agent

	From:
	GUCCI
LUXEMBOURG S.A., CADEMPINO BRANCH 

Date: [                        ] 

GUCCI GROUP N.V.—€460,000,000

Multicurrency Revolving Facility Agreement dated [            ], 2003  

	27.
	We
notify you that [name of Borrower] requests an Advance as follows:

	(uu)
	Facility:
[A/B](3)

	(vv)
	Drawdown
date: [                        ]

	(ww)
	Currency:
[                        ]

	(xx)
	Amount:
[                        ]

	(yy)
	Term:
[                        ]

	(zz)
	Payment
instructions: [                        ]

	28.
	[If
it is not possible, pursuant to Clause 0 (Optional Currency) of the Facility Agreement, for the Advance to be
made in the currency specified at (c) above we would wish the Advance to be denominated in Euros.]

	[2/3]
	. We
confirm that each condition specified in Clause 0 (Drawdown Conditions) is satisfied on the date
of this Notice of Drawdown. 

By:

GUCCI
GROUP N.V.

Authorised Signatory 

	(3)
	Delete
as appropriate.

	(4)
	If
currency selected is an Optional Currency (other than Sterling or Dollars); optional. 

73

 
 
 

Part B
  Term-Out Notice    
    

	To:
	[UNICREDITO
ITALIANO S.p.A., London Branch] as Facility Agent

	From:
	GUCCI
LUXEMBOURG S.A., CADEMPINO BRANCH 

Date: [                        ] 

GUCCI GROUP N.V.—€460,000,000

Multicurrency Revolving Facility Agreement dated [            ], 2003  

	29.
	We
wish to exercise the Term-out Option of Facility A.

	30.
	We
request that the Term-out Date shall be [ ].

	31.
	We
request that the Term-out Maturity Date shall be [    ].

	32.
	We
confirm that each condition specified in Clause 0 (Drawdown Conditions) is satisfied on the date of this Term-out
Notice. 

By:

GUCCI
GROUP N.V.

Authorised Signatory 

 
 

Additional Borrowers    
    

 
 

Part B
  Form of Borrower Accession Memorandum    
    

	To:
	[UNICREDITO
ITALIANO S.p.A., London Branch] as Facility Agent

	From:
	Gucci
Group N.V. for and on behalf of each of the Guarantors (as hereinafter defined) and [PROPOSED BORROWER] 

Date: [                        ] 

Dear
Sirs 

	33.
	We
refer to the agreement (as from time to time amended, varied, novated or supplemented, the "Facility Agreement") dated 28 November,
2003 and made between Gucci Group N.V. and others as borrowers, Gucci Group N.V. and others as guarantors, the mandated lead arrangers and co-arrangers named therein, UniCredito Italiano
S.p.A., London Branch as agents and the financial institutions named therein as banks.

	34.
	Terms
defined in the Facility Agreement shall bear the same meaning herein.

	35.
	Gucci
Group N.V. hereby requests on behalf of itself and each of the Guarantors that [Proposed Borrower] become
an additional Borrower pursuant to Clause 0 (Additional Borrowers) of the Facility Agreement.

	36.
	[Proposed Borrower] undertakes to deliver to the Facility Agent the documents listed in Part B of
Schedule 5 (Documents to Accompany Borrower Accession Memorandum) to the Facility Agreement. 

74

 
	37.
	[Proposed Borrower] hereby agrees to such request and accordingly undertakes, upon its becoming a Borrower, to
perform all the obligations expressed to be undertaken under the Facility Agreement by a Borrower in all respects as if it had been an original party thereto as a Borrower.

	38.
	Gucci
Group N.V. confirms on behalf of itself and each of the Guarantors that each of the Guarantors guarantees in accordance with Clause 0 (Guarantee
and Indemnity) of the Facility Agreement all the obligations of [Proposed Borrower] under the Facility
Agreement in all respects in accordance with the terms of the Facility Agreement.

	39.
	Each
of Gucci Group N.V. and [Proposed Borrower]:

	(aaa)
	hereby
makes, for the benefit of the Facility Agent and each of the Banks, each of the representations set out in Clause 0
(Representations) of the Facility Agreement which are to be repeated pursuant to Clause 0
(Repetition); and

	(bbb)
	confirms
that no Event of Default or Potential Event of Default has occurred and is continuing.

	40.
	This
memorandum shall be governed by and construed in all respects in accordance with English law.

	41.
	The
provisions of Clauses 0, 0, and 0 of the Facility Agreement shall be deemed to be set out, mutatis mutandis, herein as if
references to this "Agreement" were references to this Borrower Accession Memorandum. 

	Gucci Group N.V. for and behalf of itself and each of the Guarantors	 	[Proposed Borrower]	 	 
	By:	 	 	 	By:	 	 	 	 
	 	 	
	 	 	 	
	 	 

75

 
 
 

Part B
  Documents to Accompany Borrower Accession Memorandum    
    

	42.
	A
copy, certified a true copy by a duly authorised officer of the proposed additional Borrower, of the constitutive documents of such proposed additional Borrower.

	43.
	A
copy, certified a true copy by a duly authorised officer of the proposed additional Borrower, of any necessary board or shareholder resolution (as the case may be) of such proposed
additional Borrower approving the execution and delivery of a Borrower Accession Memorandum, the accession of such proposed Borrower to the Facility Agreement and the performance of its obligations
under the Facility Agreement and authorising a person or persons (specified by name or office) on behalf of such proposed additional Borrower to sign such Borrower Accession Memorandum and any other
documents to be delivered by such proposed additional Borrower pursuant thereto.

	44.
	A
certificate of a duly authorised officer of the proposed additional Borrower setting out the names and signatures of the person or persons mentioned in the resolution referred to in
paragraph 2 above.

	45.
	A
certificate addressed to the Facility Agent signed by two directors of the proposed additional Borrower stating that the execution by such proposed additional Borrower of the
Facility Agreement and the performance by such proposed additional Borrower of its obligations thereunder are within its corporate powers, have been duly approved by all necessary corporate action and
will not cause any limit or restriction on any of its powers (whether imposed by law, decree, rule, regulation, its constitutive documents or agreement or otherwise) or on the right or ability of its
directors to execute such powers, to be exceeded or breached.

	46.
	In
sufficient copies for the Banks, its latest financial statements (audited, if required to be produced by the proposed additional Borrower pursuant to applicable law).

	47.
	Such
legal opinions as may be reasonably required by the Facility Agent in a form satisfactory to the Facility Agent. 

 
 

Additional Guarantors    
    

 
 

Part C
  Form of Guarantor Accession Memorandum    
    

	To:
	[UNICREDITO
ITALIANO S.p.A., London Branch] as Facility Agent

	From:
	[PROPOSED
GUARANTOR] 

Date: [                        ] 

Dear
Sirs 

	48.
	We
refer to the agreement (as from time to time amended, varied, novated or supplemented, the "Facility Agreement") dated 28 November,
2003 and made between Gucci Group N.V. and others as borrowers, Gucci Group N.V. and others as guarantors, the mandated lead arrangers and co-arrangers named therein, UniCredito Italiano
S.p.A., London Branch as agents and the financial institutions named therein as banks.

	49.
	Terms
defined in the Facility Agreement shall bear the same meaning herein. 

76

 
	50.
	We
[name of company] of [address] agree
to become an additional Guarantor pursuant to Clause 0 (Additional Guarantors) of the Facility Agreement.

	51.
	We
undertake to deliver to the Facility Agent the documents listed in Part B of Schedule 6 to the Facility Agreement within 5 days of the date hereof.

	52.
	We:

        (ccc)
hereby make on our own behalf, for the benefit of the Facility Agent and each of the Banks, each of the representations set out in: 

	(i)
	Clause 0
(Representations) of the Facility Agreement which are to be repeated by each
[    ] Obligor pursuant to Clause 0 (Repetition) subject to any limitations, restrictions and exclusions
applicable to any existing [    ] Obligors]; [and

	(ii)
	Clause 0
(US Obligors—consideration and enforceability)]*; and 

        (ddd)
confirm that no Event of Default or Potential Event of Default has occurred and is continuing. 

	53.
	This
memorandum shall be governed by and construed in all respects in accordance with English law.

	54.
	The
provisions of Clauses 0, 0, and 0 of the Facility Agreement shall be deemed to be set out, mutatis mutandis, herein as if
references to this "Agreement" were references to this Guarantor Accession Memorandum.

	55.
	This
Guarantor Accession Memorandum is entered into by way of deed. 

	[EXECUTED as a deed by	 	)	 	Director
	[PROPOSED GUARANTOR] acting	 	)	 	 
	by [NAME OF DIRECTOR] and	 	)	 	Director/Secretary
	[NAME OF DIRECTOR/SECRETARY]	 	)	 	 
	or	 	 	 	 
	THE COMMON SEAL of	 	)	 	 
	[PROPOSED GUARANTOR]	 	)	 	 
	was hereunto affixed in the	 	)	 	 
	presence of:	 	)(5)	 	 

	*
	To
be included if additional Guarantor is incorporated in the US.

	(5)
	To
be acknowledged by Facility Agent if executed by a French Obligor. 

77

 
 
 

(iii)
  Documents to Accompany Guarantor Accession Memorandum    
    

	56.
	A
copy, certified a true copy by a duly authorised officer of the proposed additional Guarantor, of the constitutive documents of such proposed additional Guarantor.

	57.
	A
copy, certified a true copy by a duly authorised officer of the proposed additional Guarantor, of any necessary board or shareholder resolution (as the case may be) of such proposed
additional Guarantor approving the execution and delivery of a Guarantor Accession Memorandum, the accession of such proposed Guarantor to the Facility Agreement and the performance of its obligations
under the Facility Agreement and authorising a person or persons (specified by name or office) on behalf of such proposed additional Guarantor to sign such Guarantor Accession Memorandum and any other
documents to be delivered by such proposed additional Guarantor pursuant thereto.

	58.
	A
certificate of a duly authorised officer of the proposed additional Guarantor setting out the names and signatures of the person or persons mentioned in the resolution referred to
in paragraph 2 above.

	59.
	A
certificate addressed to the Facility Agent signed by two directors (or, in the case of an additional Guarantor with only one director, signed by one director) of the proposed
additional Guarantor stating that the execution by such proposed additional Guarantor of the Facility Agreement and the performance by such proposed additional Guarantor of its obligations thereunder
are within its corporate powers, have been duly approved by all necessary corporate action and will not cause any limit or restriction on any of its powers (whether imposed by law, decree, rule,
regulation, its constitutive documents or agreement or otherwise) or on the right or ability of its directors to execute such powers, to be exceeded or breached.

	60.
	In
sufficient copies for the Banks, its latest financial statements (audited, if required to be produced by the proposed additional Guarantor pursuant to applicable law).

	61.
	Such
legal opinions as may be reasonably required by the Facility Agent in a form satisfactory to the Facility Agent. 

78

 
 
 

(iv)
  Form of Original Guarantor Accession Memorandum    
    

	To:
	[UNICREDITO
ITALIANO S.p.A., London Branch] as Facility Agent

	From:
	[PROPOSED
GUARANTOR] 

Date: [    •    ] 

Dear
Sirs 

	1.
	We
refer to the agreement (as from time to time amended, varied, novated or supplemented, the "Facility Agreement") dated 28 November,
2003 and made between Gucci Group N.V. and others as borrowers, Gucci Group N.V. and others as guarantors, the mandated lead arrangers and co-arrangers named therein, UniCredito Italiano
S.p.A., London Branch as agents and the financial institutions named therein as banks.

	2.
	Terms
defined in the Facility Agreement shall bear the same meaning herein.

	3.
	We
[name of company] of [address] agree
to become a Guarantor pursuant to Clause 0 (Original Guarantors) of the Facility Agreement.

	4.
	We
undertake to deliver to the Facility Agent documentation in accordance with Clause 0(b) (Original Guarantor) of the Facility
Agreement within 5 days of the date hereof.

	5.
	We:

	(eee)
	hereby
make on our own behalf, for the benefit of the Facility Agent and each of the Banks, each of the representations set out in:

	•
	Clause 0
(Representations) of the Facility Agreement applicable to each
[    •    ] Obligor subject to any limitations, restrictions and exclusions applicable to
[    •    ] Obligors]; [and

	•
	Clause 0
(US Obligors—consideration and enforceability)](6); and

	(fff)
	confirm
that no Event of Default or Potential Event of Default has occurred and is continuing.

	6.
	This
memorandum shall be governed by and construed in all respects in accordance with English law.

	7.
	The
provisions of Clauses 27, 28 and 30 of the Facility Agreement shall be deemed to be set out, mutatis mutandis, herein as if
references to this "Agreement" were references to this Guarantor Accession Memorandum. 

79

 
	8.
	This
Original Guarantor Accession Memorandum is entered into by way of deed. 

	[EXECUTED as a deed by	 	)	 	Director
	[PROPOSED GUARANTOR] acting	 	)	 	 
	by [NAME OF DIRECTOR] and	 	)	 	Director/Secretary
	[NAME OF DIRECTOR/SECRETARY]	 	)	 	 
	or	 	 	 	 
	THE COMMON SEAL of	 	)	 	 
	[PROPOSED GUARANTOR]	 	)	 	 
	was hereunto affixed in the	 	)	 	 
	presence of:	 	)(7)	 	 

	
(6)
	To
be included if additional Guarantor is incorporated in the US.

	(7)
	To
be acknowledged by the Facility Agent if executed by a French Obligor. 

80

 

 
 

Form of Compliance Certificate    
    

	To:
	[UNICREDITO
ITALIANO S.p.A., London Branch]

(as Facility Agent for the Banks participating in the

agreement referred to below) 

[Date] 

Dear
Sirs 

        I
refer to the agreement (the "Facility Agreement") dated 28 November, 2003 and made between Gucci Group N.V. and others as borrowers,
Gucci Group N.V. and others as guarantors, UniCredito Italiano S.p.A., London Branch as agents, the mandated lead arrangers and co-arrangers named therein and the financial institutions
defined therein as Banks. 

        Terms
defined in the Facility Agreement shall bear the same meaning herein. 

        In
accordance with the Facility Agreement I hereby certify that: 

	(b)
	I,
[                        ], am the Chief Financial Officer of Gucci Group N.V. as of the date hereof.

	(c)
	As
detailed in Clause 13, pursuant to Clause 13.1, the financial condition of the Group on a consolidated basis as at [            ], as
evidenced by the consolidated financial statements for the financial year/Financial Half-Year then ended comply with the following conditions:

	(i)
	Gearing: 

	(1)	 	Net Financial Indebtedness	 	 	 	("A")
	 	 	 	 	
	 	 
	 	 	Net Worth	 	 	 	("B")
	 	 	 	 	
	 	 
	 	 	A: B (not to be greater than 1:1)	 	 	 	 
	 	 	 	 	
	 	 
	(2)	 	Net Financial Indebtedness	 	 	 	("A")
	 	 	 	 	
	 	 
	 	 	EBITDA (on a Rolling Basis)	 	 	 	("X")
	 	 	 	 	
	 	 
	 	 	A: X (not to be greater than 3:1)	 	 	 	 
	 	 	 	 	
	 	 

	(iii)
	Interest
Cover (calculated on a Rolling Basis) 

	EBITDA	 	 	 	("X")
	 	 	
	 	 
	Net Financial Payments	 	 	 	("Y")
	 	 	
	 	 
	X: Y (not to be less than 4:1)	 	 	 	 
	 	 	
	 	 

	(d)
	As
at [end of financial year/Half-Year Date], the aggregate total Asset Value/EBIT of the
Guarantors under the Facility Agreement represent not less than 85 per cent. of the total Asset Value/EBIT of the Group.] 

OR

[Pursuant
to Clause 29.4, in order that the aggregate total Asset Value/EBIT of the Guarantors under the Facility Agreement represent not less than 85 per cent. of the total Asset
Value/EBIT of the Group, the following members of the Group are required to become additional Guarantors (or, as relevant, pledges of the shares in such members of the Group will be given, in
accordance with Clause 29.4(d)).] 

[List additional Guarantors] 

....................................................

[Name]

Chief Financial Officer, Gucci Group N.V. 

81

  

 
 

Calculation of the Mandatory Cost    
    

	(e)
	For
the purpose of paragraph (a) of the definition of Mandatory Cost, the Mandatory Cost for an Advance for each Term applicable thereto is the rate determined by the Facility
Agent to be equal to the arithmetic mean (rounded upward, if necessary, to the nearest 1/16th of one per cent.) of the respective rates notified by each of the Reference Banks to the
Facility Agent and calculated in accordance with the following formulae: 

	 	 	in relation to an Advance denominated in Sterling:	 	 
	 	 	BY + S(Y-Z)+Fx0.01
	% per annum	 	 
	 	 	100-(B + S)	 	 	 
	 	 	in relation to any other Advance:	 	 	 
	 	 	Fx0.01
	% per annum	 	 
	 	 	300	 	 	 
	 	 	where on the day of application of the formula:

	 	 

	B
	is
the percentage of the Reference Bank's eligible liabilities (in excess of any stated minimum) which the Bank of England requires the Reference Bank to hold on a
non-interest-bearing deposit account in accordance with its cash ratio requirements;

	Y
	is
LIBOR at or about 11.00 a.m. on that day for the relevant Interest Period;

	S
	is
the percentage of the Reference Bank's eligible liabilities which the Bank of England requires the Reference Bank to place as a special deposit;

	Z
	is
the interest rate per annum allowed by the Bank of England on special deposits; and

	F
	is
the charge payable by the Reference Bank to the Financial Services Authority under paragraph 2.02 or 2.03 (as appropriate) of the Fees Regulations (but where for this purpose,
the figure in paragraph 2.02b and 2.03b will be deemed to be zero) expressed in pounds per £1 million of the fee base of the Reference Bank.

	(f)
	For
the purposes of this Schedule 8:

	(ii)
	"eligible liabilities" and "special deposits" have the meanings given to them at the
time of application of the formula by the Bank of England;

	(iii)
	"fee base" has the meaning given to it in the Fees Regulations; and

	(iv)
	"Fees Regulations" means the Financial Services Banking Supervision (Fees) Regulations 2000 and/or any other regulations governing the
payment of fees for banking supervision.

	(g)
	In
the application of the formula, B, Y, S and Z are included in the formula as figures and not as percentages, e.g. if B = 0.5% and Y = 15%, BY is calculated as 0.5
× 15.

	(h)
	If
a Reference Bank does not supply a rate to the Facility Agent, the applicable Mandatory Cost will be determined on the basis of the rate(s) supplied by the remaining Reference
Banks.

	(i)
	

	(v)
	The
formula is applied on the first day of each Term.

	(iv)
	Each
rate calculated in accordance with the formula is, if necessary, rounded upward to the nearest 1/16th of one per cent. 

82

 

	(j)
	If
the Facility Agent determines that a change in circumstances has rendered, or will render, the formulae inappropriate, the Facility Agent (after consultation with the Banks) shall
notify the Borrowers' Agent of the manner in which the Mandatory Cost will subsequently be calculated. The manner of calculation so notified by the Facility Agent shall, in the absence of manifest
error, be binding on all the parties to this Agreement. 

83

 
 
 

SIGNATORIES    
    

Borrowers

GUCCI GROUP N.V.

By: Marco Biagioni 

GUCCI LUXEMBOURG S.A.,
  Lussemburgo, succursale Euro Financial Investments di Cadempino

By: Marco Biagioni 

GUCCI INTERNATIONAL N.V.
  By: Marco Biagioni 

Guarantors  

GUCCI GROUP N.V.
  By: Marco Biagioni 

GUCCI INTERNATIONAL N.V.
  By: Marco Biagioni 

GUCCI LUXEMBOURG S.A.,
  Lussemburgo, succursale Euro Financial Investments di Cadempino

By: Marco Biagioni 

Gucci
Luxembourg S.A. acting through its Euro Financial Investments Cadempino Branch in its capacity as Borrower and Guarantor, hereby expressly and specifically accepts the provisions of
Clause 30.2, Clause 30.3 and Clause 30.6 of this Agreement for the purposes of, and in accordance with, article 1 of the Protocol of the Convention on Jurisdiction and
Enforcement of Judgments in Civil and Commercial Matters signed at Brussels on 27th September, 1968, as amended. 

By:
Marco Biagioni 

GUCCI LUXEMBOURG S.A.,
  Lussemburgo, succursale Euro Financial Investments di Cadempino 

Borrowers' Agent  

GUCCI LUXEMBOURG S.A.,

Lussemburgo, succursale Euro Financial Investments di Cadempino

By: Marco Biagioni  

 Mandated Lead Arrangers  

BANCA POPOLARE DI MILANO S.C.a R.L.
  By: Carlos Barona (as attorney) 

CITIGROUP GLOBAL MARKETS LIMITED
  By: Carlos Barona 

ING BANK N.V.—MILAN BRANCH
  By: Rodolfo Sertic Evelina Riboni 

MIZUHO CORPORATE BANK, LTD
  By: Carlos Barona (as attorney) 

84

 

SANPAOLO IMI S.P.A—DIVISIONE IMPRESE
  By: Gabriele Gori 

THE ROYAL BANK OF SCOTLAND PLC, MILAN BRANCH
  By: Rossella Schiavini 

UNICREDIT BANCA MOBILIARE S.p.A.
  By: Daniele Di MarioSabino Chiariello 

Co-Arrangers
  

        ABN AMRO BANK N.V.—MILAN BRANCH
  By: Carlos Barona (as attorney) 

BANCA DI ROMA SPA
  By: Carlos Barona (as attorney) 

BANCA INTESA SPA—CENTRO CORPORATE DI FIRENZE
  By: Alberto Barattini Piero Ciappina. 

BANCA MONTE DEI PASCHI DI SIENA S.p.a.
  By: Carlos Barona (as attorney) 

BANCO POPOLARE DI VERONA E NOVARA (LUXEMBOURG) S.A.
  By: Lino Tonolli 

BANCA TOSCANA S.P.A.
  By: Carlos Barona (as attorney) 

BIPOP CARIRE, societa per azioni
  By: Carlos Barona (as attorney) 

BNP PARIBAS S.A.
  By: Carlos Barona (as attorney) 

BANCA C.R. FIRENZE—CENTRO IMPRESE FIRENZE OVEST
  By: Carlos Barona (as attorney) 

WESTLB IRELAND PLC
  By: Jose Manuel Lopez Martinez 

Banks  

BANCA POPOLARE DI MILANO S.C.a R.L.
  By: Carlos Barona (as attorney) 

CITIBANK NA, LONDON
  By: Carlos Barona (as attorney) 

ING BANK N.V.—MILAN BRANCH
  By: Rodolfo Sertic Evelina Riboni 

MIZUHO CORPORATE BANK, LTD
  By: Carlos Barona (as attorney) 

SANPAOLO IMI S.P.A—Divisione Imprese
  By: Gabriele Gori 

THE ROYAL BANK OF SCOTLAND PLC, MILAN BRANCH
  By: Rossella Schiavini 

85

 

UNICREDITO ITALIANO S.p.A., LONDON BRANCH
  By: Daniele Di MarioSabino Chiariello 

ABN AMRO BANK N.V.—MILAN BRANCH
  By: Carlos Barona (as attorney) 

BANCA DI ROMA SPA
  By: Carlos Barona (as attorney) 

BANCA INTESA Spa—centro corporate di firenze
  By: Alberto Barattini Piero Ciappina. 

BANCA MONTE DEI PASCHI DI SIENA S.p.a.
  By: Carlos Barona (as attorney) 

BANCO POPOLARE DI VERONA E NOVARA (LUXEMBOURG) S.A.
  By: Lino Tonolli 

BANCA TOSCANA S.p.a.
  By: Carlos Barona (as attorney) 

BIPOP CARIRE, societÀ per azioni
  By: Carlos Barona (as attorney) 

BNP PARIBAS S.A.
  By: Carlos Barona (as attorney) 

BANCA C.R. FIRENZE—CENTRO IMPRESE FIRENZE OVEST
  By: Carlos Barona (as attorney) 

WESTLB IRELAND PLC
  By: Jose Manuel Lopez Martinez 

Facility Agent and Security Agent  

UNICREDITO ITALIANO S.p.A., LONDON BRANCH
  By: Daniele Di Mario Sabino Chiariello 

86

QuickLinks

EXHIBIT 4.2

CONTENTS

Definitions and Interpretation

The Facilities

Utilisation of the Facilities

Payment and Calculation of Interest

Market Disruption and Alternative Interest Rates

Repayment

Cancellation and Prepayment

Taxes

Tax Receipts

Changes in Circumstances

Representations

Financial Information

Financial Condition

Covenants

Events of Default

Guarantee and Indemnity

Default Interest and Indemnity

Currency of Account and Payment

Payments

Set-Off

Sharing

Commitment Commission and Fees

Costs and Expenses

The Agents, the Mandated Lead Arrangers, The Co-Arrangers and the Banks

Assignments and Transfers

Calculations and Evidence of Debt

Remedies and Waivers, Partial Invalidity

Notices and Counterparts

Amendments and Additional Borrowers and Guarantors

Law and Jurisdiction

The Banks and Commitments

(i) -1 Facility A Commitments

(ii) -1 Facility B Commitments

Form of Transfer Certificate

TRANSFER CERTIFICATE

THE SCHEDULE

Administrative Details of Transferee

Condition Precedent Documents

Part 1

Part A Notice of Drawdown

Part B Term-Out Notice

Additional Borrowers

Part B Form of Borrower Accession Memorandum

Part B Documents to Accompany Borrower Accession Memorandum

Additional Guarantors

Part C Form of Guarantor Accession Memorandum

(iii)  Documents to Accompany Guarantor Accession Memorandum

(iv)  Form of Original Guarantor Accession Memorandum

Form of Compliance Certificate

Calculation of the Mandatory Cost

SIGNATORIES

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