Document:

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                                                                    EXHIBIT 10.1

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                              AMENDED AND RESTATED
                                CREDIT AGREEMENT

                                      among

                            COLE VISION CORPORATION,
                             THINGS REMEMBERED, INC.
                                       and
                                  PEARLE, INC.,

                               The Several Lenders
                        from Time to Time Parties Hereto,

                          LEHMAN COMMERCIAL PAPER INC.,
                              as Syndication Agent,

                      WACHOVIA BANK, NATIONAL ASSOCIATION,
                             as Documentation Agent,

                                       and

                       CANADIAN IMPERIAL BANK OF COMMERCE,
                             as Administrative Agent

                            Dated as of May 23, 2002

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                            CIBC WORLD MARKETS, INC.,
                 as Advisor, Co-Lead Arranger and Co-Book Runner

                          LEHMAN COMMERCIAL PAPER INC.
                     as Co-Lead Arranger and Co-Book Runner

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                                TABLE OF CONTENTS

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    SECTION 1.   DEFINITIONS......................................................................................1
              1.1.    Defined Terms...............................................................................1
              1.2.    Other Definitional Provisions..............................................................25

    SECTION 2.   AMOUNT AND TERMS OF REVOLVING CREDIT COMMITMENTS................................................25
              2.1.    Revolving Credit Commitments...............................................................25
              2.2.    Revolving Credit Notes.....................................................................26
              2.3.    Procedure for Revolving Credit Borrowing...................................................26
              2.4.    Commitment Fees............................................................................26
              2.5.    Termination or Reduction of Revolving Credit Commitments...................................27
              2.6.    Repayment of Revolving Credit Loans........................................................27

    SECTION 3.   LETTERS OF CREDIT...............................................................................28
              3.1.    L/C Commitment.............................................................................28
              3.2.    Procedure for Issuance of Letters of Credit................................................28
              3.3.    Fees, Commissions and Other Charges........................................................29
              3.4.    L/C Participations.........................................................................29
              3.5.    Reimbursement Obligation of the Borrowers..................................................30
              3.6.    Obligations Absolute.......................................................................31
              3.7.    Letter of Credit Payments..................................................................31
              3.8.    Application................................................................................31

    SECTION 4.   GENERAL PROVISIONS..............................................................................32
              4.1.    Interest Rates and Payment Dates...........................................................32
              4.2.    Optional Prepayments.......................................................................32
              4.3.    Mandatory Prepayments and Reduction of Revolving Credit Commitments........................32
              4.4.    Conversion and Continuation Options........................................................34
              4.5.    Minimum Amounts and Maximum Number of Tranches.............................................34
              4.6.    Computation of Interest and Fees...........................................................34
              4.7.    Inability to Determine Interest Rate.......................................................35
              4.8.    Pro Rata Treatment and Payments............................................................35
              4.9.    Illegality.................................................................................36
              4.10.   Requirements of Law........................................................................36
              4.11.   Taxes......................................................................................38
              4.12.   Indemnity..................................................................................40
              4.13.   Change of Lending Office; Replacement of Lenders...........................................40

    SECTION 5.   REPRESENTATIONS AND WARRANTIES..................................................................41
              5.1.    Financial Condition........................................................................41
              5.2.    No Change; Solvency........................................................................42
              5.3.    Corporate Existence; Compliance with Law...................................................42
              5.4.    Corporate Power; Authorization; Enforceable Obligations....................................42
              5.5.    No Legal Bar...............................................................................43
              5.6.    No Material Litigation.....................................................................43
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              5.7.    No Default.................................................................................43
              5.8.    Ownership of Property; Liens...............................................................43
              5.9.    Intellectual Property......................................................................43
              5.10.   No Burdensome Restrictions.................................................................43
              5.11.   Taxes......................................................................................44
              5.12.   Federal Reserve Regulations................................................................44
              5.13.   ERISA......................................................................................44
              5.14.   Collateral.................................................................................44
              5.15.   Investment Company Act; Other Regulations..................................................45
              5.16.   Subsidiaries and Joint Ventures............................................................45
              5.17.   Purpose of Revolving Credit Loans..........................................................45
              5.18.   Environmental Matters......................................................................45
              5.19.   Regulation H...............................................................................46
              5.20.   No Material Misstatements..................................................................46

    SECTION 6.   CONDITIONS PRECEDENT............................................................................47
              6.1.    Conditions to Effectiveness................................................................47
              6.2.    Conditions to Each Extension of Credit.....................................................49

    SECTION 7.   AFFIRMATIVE COVENANTS...........................................................................50
              7.1.    Financial Statements.......................................................................50
              7.2.    Certificates; Other Information............................................................51
              7.3.    Payment of Obligations.....................................................................52
              7.4.    Conduct of Business and Maintenance of Existence...........................................52
              7.5.    Maintenance of Property; Insurance.........................................................52
              7.6.    Inspection of Property; Books and Records; Discussions.....................................52
              7.7.    Notices....................................................................................53
              7.8.    Environmental Laws.........................................................................54
              7.9.    Further Assurances.........................................................................55
              7.10.   Additional Collateral, etc.................................................................55

    SECTION 8.   NEGATIVE COVENANTS..............................................................................57
              8.1.    Financial Condition Covenants..............................................................57
              8.2.    Limitation on Indebtedness.................................................................59
              8.3.    Limitation on Liens........................................................................60
              8.4.    Limitation on Guarantee Obligations........................................................62
              8.5.    Limitation on Fundamental Changes..........................................................62
              8.6.    Limitation on Sale of Assets...............................................................63
              8.7.    Limitation on Dividends....................................................................63
              8.8.    Limitation on Capital Expenditures.........................................................64
              8.9.    Limitation on Investments, Loans and Advances..............................................64
              8.10.   Limitation on Transactions with Affiliates.................................................65
              8.11.   Limitation on Changes in Fiscal Year.......................................................65
              8.12.   Limitation on Negative Pledge Clauses......................................................65
              8.13.   Limitation on Lines of Business............................................................66
              8.14.   Limitations on Currency and Commodity Hedging Transactions.................................66
              8.15.   Limitation on Sale Leasebacks..............................................................66
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              8.16.   Changes to Cash Management Collection System...............................................66

    SECTION 9.   EVENTS OF DEFAULT...............................................................................66

    SECTION 10.   THE ADMINISTRATIVE AGENT.......................................................................70
              10.1.   Appointment................................................................................70
              10.2.   Delegation of Duties.......................................................................70
              10.3.   Exculpatory Provisions.....................................................................71
              10.4.   Reliance by Administrative Agent...........................................................71
              10.5.   Notice of Default..........................................................................71
              10.6.   Non-Reliance on Administrative Agent and Other Lenders.....................................72
              10.7.   Indemnification............................................................................72
              10.8.   Administrative Agent in Its Individual Capacity............................................73
              10.9.   Successor Administrative Agent.............................................................73
              10.10.  Issuing Lender.............................................................................73
              10.11.  Releases of Guarantees and Collateral......................................................73

    SECTION 11.   MISCELLANEOUS..................................................................................73
              11.1.   Amendments and Waivers.....................................................................73
              11.2.   Notices....................................................................................74
              11.3.   No Waiver; Cumulative Remedies.............................................................75
              11.4.   Survival of Representations and Warranties.................................................75
              11.5.   Payment of Expenses and Taxes..............................................................75
              11.6.   Successors and Assigns; Participations and Assignments.....................................76
              11.7.   Adjustments; Set-off.......................................................................79
              11.8.   Counterparts...............................................................................79
              11.9.   Severability...............................................................................79
              11.10.  Integration................................................................................80
              11.11.  GOVERNING LAW..............................................................................80
              11.12.  Submission To Jurisdiction; Waivers........................................................80
              11.13.  Acknowledgements...........................................................................80
              11.14.  WAIVERS OF JURY TRIAL......................................................................81
              11.15.  Confidentiality............................................................................81
              11.16.  Reference to and Effect on the Existing Credit Agreement...................................81
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SCHEDULES

I                 Revolving Credit Commitments and Addresses
II                Applicable Margin Calculation for Revolving Credit Loans
5.1               Certain Obligations and Liabilities
5.4               Consents
5.5               Material Contracts; Court Orders and Decrees
5.8               Owned Real Properties
5.13              ERISA Non-compliance
5.14              Equipment and Inventory of Borrowers and Subsidiaries
5.16              Subsidiaries and Joint Ventures
8.2(d)            Permitted Indebtedness
8.3(h)            Permitted Liens
8.4(a)            Permitted Guarantee Obligations

EXHIBITS

A                 Form of Revolving Credit Note
B-1               Form of Guarantee and Collateral Agreement
B-2               Form of Copyright, Patent and Trademark Security Agreement
B-3               Form of CNG Guarantee and Cash Collateral Agreement
C                 Form of Borrowing Certificate
D                 Form of Opinion of Counsel to Borrowers
E                 Form of U.S. Tax Compliance Certificate
F                 Form of Assignment and Acceptance
G                 Form of Borrowing Base Certificate
H                 Form of Compliance Package
I                 Form of Borrowing Notice
J                 Form of Continuation/Conversion Notice
K                 Form of CNC Guarantee

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         AMENDED AND RESTATED CREDIT AGREEMENT, dated as of May 23, 2002, among
COLE VISION CORPORATION, a Delaware corporation ("COLE VISION"), THINGS
REMEMBERED, INC., a Delaware corporation ("THINGS REMEMBERED") and PEARLE, INC.,
a Delaware corporation ("PEARLE"; Cole Vision, Things Remembered, and Pearle
each being referred to as a "BORROWER" and collectively as the "BORROWERS"), the
several banks and other financial institutions from time to time parties to this
Agreement (collectively, the "LENDERS"), LEHMAN COMMERCIAL PAPER INC., as
syndication agent (in such capacity, the "SYNDICATION AGENT"), WACHOVIA BANK,
NATIONAL ASSOCIATION, as documentation agent (in such capacity, the
"DOCUMENTATION AGENT"), and CANADIAN IMPERIAL BANK OF COMMERCE, a
Canadian-chartered bank acting through its New York Agency, as administrative
agent for the Lenders hereunder (in such capacity, the "ADMINISTRATIVE AGENT").

                              W I T N E S S E T H :
                              - - - - - - - - - -

         WHEREAS, the Borrowers, the Administrative Agent, and certain banks and
other financial institutions are parties to the Credit Agreement dated as of
November 15, 1996 (as previously amended or modified, the "EXISTING CREDIT
AGREEMENT"), and the parties thereto wish to make certain modifications thereto;

         WHEREAS, the Borrowers have requested that the Existing Credit
Agreement be amended and restated to (i) extend the maturity of the revolving
credit facility provided for therein from January 31, 2003 to May 31, 2006 and
(ii) make certain additional modifications thereto; and

         WHEREAS, the Lenders and the Administrative Agent are agreeable to the
Borrowers' request and to amending and restating the Existing Credit Agreement,
but only upon the terms and subject to the conditions set forth below;

         NOW THEREFORE, in consideration of the promises and mutual agreements
herein contained and for other good and valuable consideration, the receipt and
sufficiency of which is hereby acknowledged by each of the parties hereto, the
parties hereto hereby agree that on the Closing Date (as hereinafter defined)
the Existing Credit Agreement shall be amended and restated to read in its
entirety as follows:

                             SECTION 1. DEFINITIONS

         1.1. DEFINED TERMS. As used in this Agreement, the following terms
shall have the following meanings (such terms to be equally applicable to the
singular and plural forms thereof):

          "ABR LOANS": Revolving Credit Loans the rate of interest applicable to
     which is based upon the CIBC Alternate Base Rate.

          "ACCOUNT": as defined in the Uniform Commercial Code as in effect in
     the State of New York; and, with respect to the Borrowers and their
     Subsidiaries, all such

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     Accounts of such Persons, whether now existing or existing in the future,
     including, without limitation (i) all accounts receivable of such Person
     including, without limitation, all accounts created by or arising from all
     of such Person's sales of goods or rendition of services made under any of
     its trade names, or through any of its divisions, (ii) all unpaid rights of
     such Person (including rescission, replevin, reclamation and stopping in
     transit) relating to the foregoing or arising therefrom, (iii) all rights
     to any goods represented by any of the foregoing, including returned or
     repossessed goods and (iv) all reserves and credit balances held by such
     Person with respect to any such accounts receivable or any Obligors.

          "ADJUSTED INTEREST COVERAGE RATIO": as of the end of each fiscal
     quarter of CNG, with respect to CNG and its Subsidiaries on a Consolidated
     basis, the ratio of (a) EBITDAR for the twelve month period ending on such
     date to (b) the sum of (i) the aggregate amount paid in cash during the
     twelve month period ending on such date in respect of items of Interest
     Expense and (ii) Rental Expense for the twelve month period ending on such
     date.

          "ADJUSTMENT DATE": each date on or after the date which is six months
     following the Closing Date that is the second Business Day following
     receipt by the Lenders of both (i) the financial statements required to be
     delivered pursuant to subsection 7.1(a) or 7.1(b), as applicable, for the
     most recently completed fiscal period and (ii) the related Compliance
     Certificate required to be delivered pursuant to subsection 7.2(b) with
     respect to such fiscal period.

          "ADMINISTRATIVE AGENT": CIBC, together with its affiliates, as the
     co-lead arranger of the Revolving Credit Commitments and as the
     administrative agent for the Lenders under this Agreement and the other
     Loan Documents.

          "AFFILIATE": as to any Person, any other Person (other than a
     Subsidiary Guarantor) which, directly or indirectly, is in control of, is
     controlled by, or is under common control with, such Person. For purposes
     of this definition, "control" of a Person means the power, directly or
     indirectly, either to (a) vote 10% or more of the securities having
     ordinary voting power for the election of directors of such Person or (b)
     direct or cause the direction of the management and policies of such
     Person, whether by contract or otherwise.

          "AGGREGATE OUTSTANDING REVOLVING CREDIT": as to any Lender at any
     time, an amount equal to the sum of (a) the aggregate principal amount of
     all Revolving Credit Loans made by such Lender then outstanding and (b)
     such Lender's Revolving Credit Commitment Percentage of the L/C Obligations
     then outstanding.

          "AGREEMENT": this Amended and Restated Credit Agreement, as amended,
     supplemented or otherwise modified from time to time.

          "APPLICABLE MARGIN": as applied to a given Type of Revolving Credit
     Loan, the rate per annum, determined on each Adjustment Date, set forth
     under the heading "ABR Loans Applicable Margin" or "Eurodollar Loans
     Applicable Margin", as applicable, on

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     Schedule II which corresponds to the Leverage Ratio determined from the
     financial statements and Compliance Certificate relating to the end of the
     fiscal quarter immediately preceding such Adjustment Date; PROVIDED,
     FURTHER that in the event that the financial statements required to be
     delivered pursuant to subsection 7.1(a) or 7.1(b), as applicable, and the
     related Compliance Certificate required to be delivered pursuant to
     subsection 7.2(b), are not delivered when due, then

               (a) if such financial statements and Compliance Certificate are
          delivered after the date such financial statements and Compliance
          Certificate were required to be delivered (without giving effect to
          any applicable cure period) and the Applicable Margin increases from
          that previously in effect as a result of the delivery of such
          financial statements and Compliance Certificate, then the Applicable
          Margin in respect of Revolving Credit Loans during the period from the
          date upon which such financial statements and Compliance Certificate
          were required to be delivered (without giving effect to any applicable
          cure period) until the date upon which they actually are delivered
          shall, except as otherwise provided in clause (c) below, be the
          Applicable Margin as so increased;

               (b) if such financial statements and Compliance Certificate are
          delivered after the date such financial statements and Compliance
          Certificate were required to be delivered and the Applicable Margin
          decreases from that previously in effect as a result of the delivery
          of such financial statements and Compliance Certificate, then such
          decrease in the Applicable Margin shall not become applicable until
          the date upon which such financial statements and Compliance
          Certificate actually are delivered; and

               (c) if such financial statements and Compliance Certificate are
          not delivered prior to the expiration of the applicable cure period,
          then, effective upon such expiration, for the period from the date
          upon which such financial statements and Compliance Certificate were
          required to be delivered (after the expiration of the applicable cure
          period) until two Business Days following the date upon which such
          financial statements and Compliance Certificate actually are
          delivered, the Applicable Margin in respect of Revolving Credit Loans
          shall be 1.25% per annum, in the case of ABR Loans, and 2.25% per
          annum, in the case of Eurodollar Loans.

          "ASSIGNEE": as defined in subsection 11.6(c).

          "AVAILABLE REVOLVING CREDIT COMMITMENT": as to any Lender at any time,
     an amount equal to the excess, if any, of (a) the amount of such Lender's
     Revolving Credit Commitment at such time OVER (b) the sum of (i) the
     aggregate unpaid principal amount at such time of all Revolving Credit
     Loans made by such Lender and (ii) an amount equal to such Lender's
     Revolving Credit Commitment Percentage of the outstanding L/C Obligations
     at such time; collectively, as to all the Lenders, the "AVAILABLE REVOLVING
     CREDIT COMMITMENTS".

          "BORROWER" and "BORROWERS": as defined in the preamble hereto.

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          "BORROWING BASE CERTIFICATE": as defined in subsection 7.2(e).

          "BORROWING BASE": an amount, calculated on a monthly basis based upon
     the most recent Borrowing Base Certificate delivered pursuant to subsection
     7.2(e), equal to the sum (without duplication) of (a) 80% of Eligible
     Accounts, (b) 50% of Eligible Inventory and (c) 25% of Eligible Property.
     All determinations in connection with the Borrowing Base shall be made by
     the Borrowers and certified to the Administrative Agent by a Responsible
     Officer; PROVIDED, HOWEVER, that the Administrative Agent shall have the
     final right to review and adjust, in its reasonable judgment after
     consultation with the Borrowers, any such determination to the extent such
     determination is not in accordance with this Agreement. The Borrowing Base
     determined on the basis of any Borrowing Base Certificate shall remain in
     effect from and including the date on which such Borrowing Base Certificate
     is delivered, to but excluding the date on which the next Borrowing Base
     Certificate is delivered.

          "BORROWING BASE DEFICIENCY": a condition wherein the sum of (a) the
     aggregate principal amount of all Revolving Credit Loans outstanding at
     such time and (b) the aggregate amount of L/C Obligations outstanding at
     such time exceeds the Borrowing Base then in effect.

          "BORROWING DATE": any Business Day specified in a notice pursuant to
     subsection 2.3 or 3.2 as a date on which a Borrower requests the Lenders to
     make Revolving Credit Loans hereunder or the Issuing Lender to issue
     Letters of Credit hereunder.

          "BUSINESS DAY": a day other than a Saturday, Sunday or other day on
     which commercial banks in New York City are authorized or required by law
     to close, except that, when used in connection with a Eurodollar Loan,
     "Business Day" shall mean any Business Day on which dealings in Dollars
     between banks may be carried on in London, England and New York, New York.

          "CAPITAL STOCK": any and all shares, interests, participations or
     other equivalents (however designated) of capital stock of a corporation,
     any and all equivalent ownership interests in a Person (other than a
     corporation) and any and all warrants or options to purchase any of the
     foregoing.

          "CASH EQUIVALENTS": (i) marketable, direct obligations issued or
     guaranteed by the United States of America, or of any governmental agency
     or political subdivision thereof, maturing within 365 days of the date of
     purchase, (ii) Dollar-denominated time deposits and Dollar-denominated
     certificates of deposit (including eurodollar time deposits and
     certificates of deposit) maturing within 365 days of the date of purchase
     thereof issued by any United States or Canadian national, provincial or
     state (including the District of Columbia) banking institution having
     capital, surplus and undivided profits aggregating at least $250,000,000,
     or by any British, French, German, Japanese or Swiss national banking
     institution having capital, surplus and undivided profits aggregating at
     least $1,000,000,000, in each case that is (a) rated at least "A" by
     Standard & Poor's, a division of McGraw-Hill, Inc. ("S&P"), or at least
     "A-2" by Moody's Investors Service Inc. ("MOODY'S"), or (b) that is a
     Lender, (iii) commercial paper maturing within 270

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     days after the issuance thereof that has the highest credit rating of
     either of S&P or Moody's, (iv) readily marketable direct obligations issued
     by any state of the United States of America or any political subdivision
     thereof having the highest rating obtainable from either of S&P or Moody's,
     (v) tax exempted and tax advantaged instruments including, without
     limitation, municipal bonds, commercial paper, auction rate preferred stock
     and variable rate demand obligations with the highest short-term ratings by
     either of S&P or Moody's or a long-term debt rating of AAA from S&P, as
     applicable, (vi) repurchase agreements and reverse repurchase agreements
     with institutions described in clause (ii) above that are fully secured by
     obligations described in clause (i) above and (vii) investments not
     exceeding 365 days in duration in money market funds that invest
     substantially all of such funds' assets in the investments described in the
     preceding clauses (i) through (v).

          "C/D PUBLISHED MOVING RATE": on any particular date, the latest
     three-week moving average of daily secondary market morning offering rates
     in the United States for three-month certificates of deposit of major
     United States money market lenders, such three-week moving average
     (adjusted to the basis of a year of 360 days) being determined weekly for
     the three-week period ending on the previous Friday by the Administrative
     Agent on the basis of:

               (a) such rates reported by certificate of deposit dealers to and
          published by the Federal Reserve Bank of New York (as adjusted for
          reserves and assessments in the same manner as the C/D Quoted Rate);
          or

               (b) if such publication shall be suspended or terminated, the C/D
          Quoted Rate determined by the Administrative Agent on the basis of
          quotations for such rates by the Administrative Agent.

          "C/D QUOTED RATE": relative to any determination of the C/D Published
     Moving Rate in circumstances when publication of the rates referred to in
     clause (a) of the definition thereof has been suspended or terminated, the
     rate of interest per annum determined by the Administrative Agent to be the
     sum (rounded upward to the nearest 1/16th of 1%) of:

               (a) the rate obtained by dividing (i) the average (rounded upward
          to the nearest 1/16th of 1%) of the bid rates quoted to the
          Administrative Agent, in CIBC's secondary market at approximately
          10:00 A.M., New York City time (or as soon thereafter as practicable),
          by three certificate of deposit dealers of recognized standing
          selected by the Administrative Agent in its reasonable discretion for
          the purchase at face value of three-month certificates of deposit of
          CIBC in an amount approximately equal or comparable to the amount of
          CIBC's portion of the Revolving Credit Loans outstanding hereunder
          with respect to which the C/D Quoted Rate is being determined by (ii)
          a percentage equal to 100% MINUS the average of the daily percentages
          specified during such period by the Board of Governors of the
          Federal Reserve System (or any successor) for determining the maximum
          reserve requirement (including, but not limited to, any marginal
          reserve requirement) for a member bank of the Federal Reserve System

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          in respect of liabilities consisting of or including (among other
          liabilities) three-month Dollar nonpersonal time deposits in the
          United States; and

               (b) the daily average during such period of the net annual
          assessment rates estimated by the Administrative Agent for determining
          the then current annual assessment payable by CIBC to the Federal
          Deposit Insurance Corporation for insuring Dollar deposits of CIBC in
          the United States.

          "CHANGE OF CONTROL": (i) any Person (including such Person's
     Affiliates and associates), other than a Permitted Holder, becomes the
     beneficial owner (as defined under Rule 13d-3 or any successor rule or
     regulation promulgated under the Exchange Act) of 50% or more of the total
     voting or economic power of the Capital Stock of CNC and/or warrants or
     options to acquire such Capital Stock on a fully diluted basis, (ii) CNC
     consolidates with, or merges with or into, another Person or conveys,
     transfers, leases or otherwise disposes of all or substantially all of its
     assets to any Person, or any Person consolidates with, or merges with or
     into, CNC, in any such event pursuant to a transaction in which the
     outstanding Capital Stock of CNC is converted into or exchanged for cash,
     securities or other property, other than any such transaction where (a) (1)
     the outstanding common stock of CNC is not converted or exchanged at all
     (except to the extent necessary to reflect a change in the jurisdiction of
     incorporation) or is converted into or exchanged for Capital Stock of the
     surviving or transferee corporation (the "SURVIVING ENTITY") and (2)
     immediately after such transaction, no "person" or "group" (as such terms
     are used in Sections 13(d) and 14(d) of the Exchange Act) other than a
     Permitted Holder is the "beneficial owner" (as defined in Rules 13d-3 and
     13d-5 under the Exchange Act, except that a Person shall be deemed to have
     "beneficial ownership" of all securities that such Person has the right to
     acquire, whether such right is exercisable immediately or only after the
     passage of time), directly or indirectly, of more than a majority of the
     total outstanding Capital Stock of the Surviving Entity, or (b) the holders
     of the Capital Stock of CNC outstanding immediately prior to the
     consolidation or merger hold, directly or indirectly, at least a majority
     of the Capital Stock of the surviving corporation immediately after such
     consolidation or merger, (iii) during any period of two consecutive years,
     individuals who at the beginning of such period constituted the board of
     directors of CNC (together with any new directors whose election by such
     board of directors or whose nomination for election by the shareholders of
     CNC has been approved by 66 2/3% of the directors then still in office who
     either were directors at the beginning of such period or whose election or
     recommendation for election was previously so approved) cease to constitute
     a majority of the board of directors of CNC, (iv) CNC shall cease to own
     and control, beneficially, all of the issued and outstanding Capital Stock
     of CNG, (v) CNG shall cease to own and control all of the issued and
     outstanding Capital Stock of each Borrower or (vi) there shall occur a
     "Change of Control" under the Senior Subordinated 1997 Notes Indenture or
     the Senior Subordinated 2002 Notes Indenture.

          "CIBC": Canadian Imperial Bank of Commerce, a Canadian-chartered bank,
     acting through its New York Agency.

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          "CIBC ALTERNATE BASE RATE": on any particular date, a rate of interest
     per annum equal to the highest of:

               (a) the rate of interest most recently announced by CIBC as its
          base rate in effect at its principal office in New York City (the
          "CIBC PRIME RATE");

               (b) the Federal Funds Rate for such date plus 1/2 of 1%; and

               (c) the CD Published Moving Rate most recently determined by CIBC
          plus 1%.

     The CIBC Alternate Base Rate is not necessarily intended to be the lowest
     rate of interest charged by CIBC in connection with extensions of credit.

          "CLEAN-DOWN AMOUNT": $10,000,000.

          "CLOSING DATE": the date on which the conditions precedent set forth
     in subsection 6.1 shall be satisfied.

          "CNC": Cole National Corporation, a Delaware corporation.

          "CNC GUARANTEE": the Amended and Restated Guarantee to be executed and
     delivered by CNC in substantially the form attached hereto as Exhibit K, as
     the same may be amended, supplemented or otherwise modified from time to
     time.

          "CNG": Cole National Group, Inc., a Delaware corporation.

          "CNG GUARANTEE AND CASH COLLATERAL AGREEMENT": the Amended and
     Restated CNG Guarantee and Cash Collateral Agreement to be executed and
     delivered by CNG in substantially the form attached hereto as Exhibit B-3,
     as the same may be amended, supplemented or otherwise modified from time to
     time.

          "CODE": the Internal Revenue Code of 1986, as amended from time to
     time.

          "COLE VISION": as defined in the preamble hereto.

          "COLLATERAL": all assets (including assets constituting shares of
     Capital Stock) of the Loan Parties, now owned or hereinafter acquired, upon
     which a Lien is purported to be created by any Security Document.

          "COMMONLY CONTROLLED ENTITY": an entity, whether or not incorporated,
     which is under common control with any Borrower within the meaning of
     Section 4001 of ERISA or is part of a group which includes any Borrower and
     which is treated as a single employer under Section 414 of the Code.

          "COMPLIANCE CERTIFICATE": as defined in subsection 7.2(b).

                                       0
<PAGE>

                                                                               8

          "COMPLIANCE PACKAGE": the Cole National Group, Inc. and Subsidiaries
     Consolidated Financial Statements and Supplementary Data, in substantially
     the form of Exhibit H.

          "CONSOLIDATED": when used in connection with any financial statements
     required to be delivered pursuant to subsection 7.1 or 7.11 or computation
     of the financial covenants set forth in subsections 8.1 and 8.8, means such
     term as it applies to CNG and its Subsidiaries on a consolidated basis in
     accordance with GAAP, after eliminating all intercompany items.

          "CONTRACTUAL OBLIGATION": as to any Person, any provision of any
     security issued by such Person or of any agreement, instrument or other
     undertaking to which such Person is a party or by which it or any of its
     property is bound.

          "COPYRIGHT, PATENT AND TRADEMARK SECURITY AGREEMENT": the Amended and
     Restated Copyright, Patent and Trademark Security Agreement to be executed
     and delivered by the Borrowers and certain Subsidiaries in substantially
     the form attached hereto as Exhibit B-2, as the same may be amended,
     supplemented or otherwise modified from time to time.

          "DEFAULT": any of the events specified in Section 9, whether or not
     any requirement for the giving of notice, the lapse of time, or both, or
     any other condition, has been satisfied.

          "DEFAULTED ACCOUNT": any Account which has been or should have been
     charged-off as not collectable in conformity with the accounting policies
     of the Borrowers and their Subsidiaries as in effect from time to time.

          "DEFAULTING LENDER": at any time, any Lender that has defaulted, and
     at the time of determination continues to default, in its obligation to
     make available its Revolving Credit Commitment Percentage of any Revolving
     Credit Loan.

          "DOLLARS" and "$": dollars in lawful currency of the United States of
     America.

          "DOMESTIC SUBSIDIARY": any Subsidiary of the Borrower that is treated
     as "domestic" for U.S. federal income tax purposes.

          "EBITDA": for any period, with respect to CNG and its Subsidiaries on
     a Consolidated basis, determined in accordance with GAAP, an amount equal
     to the sum of (a) Net Income for such period, plus (b) income taxes,
     excluding income taxes (either positive or negative) attributable to
     extraordinary and non-recurring gains or losses or sales or other
     dispositions of assets permitted under subsection 8.6, plus (c) Interest
     Expense for such period, plus (d) depreciation for such period, plus (e)
     amortization for such period, plus (f) any other non-cash items (including
     minority interests) reducing Net Income for such period, plus (g)
     amortization of deferred financing costs and expenses for such period,
     minus (h) all non-cash items increasing Net Income for such period, minus
     (i) all cash payments made in such period in respect of restructuring
     charges deducted in calculating Net Income for such period or any prior
     period.

<PAGE>

                                                                               9

          "EBITDAR": for any period, with respect to CNG and its Subsidiaries on
     a Consolidated basis, determined in accordance with GAAP, an amount equal
     to the sum of EBITDA and Rental Expense for such period.

          "ELIGIBLE ACCOUNTS": at any time, an amount equal to the aggregate
     outstanding balance of all Accounts of the Borrowers and their Subsidiaries
     (other than Accounts consisting of payment obligations with respect to
     which the Obligor is a franchisee of any Borrower or any Subsidiary arising
     from Investments made pursuant to subsection 8.9(e)) payable in the United
     States of America in Dollars as set forth in the aging reports of billed
     Accounts for the Borrowers and their Subsidiaries as of such time, PROVIDED
     that, unless otherwise approved in writing by the Administrative Agent, no
     amount owing in respect of any Account shall be deemed to be included in
     any calculation of Eligible Accounts if:

          (a) such Account was, at the date of the original issuance of the
          respective invoice therefor, payable more than 60 days after such
          date;

          (b) such Account is not a bona fide, valid and legally enforceable
          obligation of the account debtor in respect thereof arising from the
          actual sale and delivery of goods or rendition and acceptance of
          services in the ordinary course of business to such account debtor;

          (c) such Account remains unpaid for more than 60 days after the date
          set forth for payment in the invoice originally issued therefor;

          (d) the Obligor is any Borrower or any Subsidiary or Affiliate
          thereof;

          (e) the sale giving rise thereto is to an Obligor in any jurisdiction
          outside the United States unless the obligation thereunder is backed
          by a letter of credit acceptable to the Administrative Agent;

          (f) such Account is a Defaulted Account;

          (g) such Account is the result of a charge-back or a reinvoice of a
          disputed Account or Defaulted Account;

          (h) the Obligor thereon is the obligor in respect of any other
          Defaulted Account;

          (i) it is an Account which may be set off or charged against (i) any
          adverse security deposit or other similar deposit made by or for the
          benefit of the applicable Obligor or (ii) any trade payable, rebate
          obligation or other similar liability owing to the applicable Obligor;
          PROVIDED that any Account deemed ineligible pursuant to this clause
          (i) shall only be ineligible to the extent of such set-off or charge
          against such adverse security deposit, trade payable, rebate
          obligation or other similar deposit or liability;

          (j) it arises from the sale to the Obligor on a bill-and-hold,
          guarantied sale, sale-and-return, sale on approval or consignment
          basis or made pursuant to any other

<PAGE>

                                                                              10

          written agreement providing for repurchase or return; PROVIDED,
          HOWEVER, that no Account shall be excluded pursuant to this clause (j)
          solely as a result of customary quality warranties or the general
          right to return goods provided by the Borrower or its Subsidiaries;

          (k) the Obligor thereon has disputed its liability on, or the Obligor
          thereon has made any claim or defense with respect to, such Account or
          any other Account due from such Obligor to any Loan Party, which has
          not been resolved; PROVIDED that any Account deemed ineligible
          pursuant to this clause (k) shall only be ineligible to the extent of
          the amount owed by such Loan Party to the Obligor thereon or the
          amount of such dispute, claim or defense;

          (l) a proceeding under bankruptcy or similar laws has occurred and is
          continuing with respect to the Obligor thereon;

          (m) the Obligor thereon is any Governmental Authority unless all
          Requirements of Law relating to the creation and perfection of a Lien
          thereon in favor of the Lenders shall have been satisfied;

          (n) the goods giving rise to such Account have not been shipped and
          delivered to the Obligor thereon or the services giving rise to such
          Account have not been performed or such Account otherwise does not
          represent a final sale or transfer of title to such Obligor;

          (o) such Account does not comply in all material respects with all
          applicable legal requirements;

          (p) if the Accounts due from any Obligor exceed an amount equal to 20%
          of the aggregate of all Accounts at said time, an amount of such
          Accounts equal to such excess;

          (q) such Account is not owned solely by such Person free and clear of
          all Liens or other rights or claims of any other Person (except in
          favor of the Administrative Agent);

          (r) such Account is subject to any material restrictions on the
          transfer, assignability or sale thereof, enforceable against the
          assignee, except pursuant to any Loan Document; or

          (s) the Administrative Agent does not have a valid and perfected first
          priority security interest in such Account for the benefit of the
          Lenders or such Account does not otherwise conform in all material
          respects to the representations and warranties contained in this
          Agreement or any of the Security Documents.

          "ELIGIBLE INVENTORY": at any time, an amount equal to the aggregate
     value (determined in accordance with the immediately succeeding sentence)
     of all Inventory of (i) Cole Vision and its Subsidiaries, located at
     distribution centers and laboratories owned or operated by Cole Vision or
     its Subsidiaries, (ii) Pearle and its Subsidiaries, located at
<PAGE>

                                                                              11

     stores owned or operated by Pearle or its Subsidiaries and distribution
     centers and laboratories owned or operated by Pearle or its Subsidiaries
     and (iii) Things Remembered and its Subsidiaries, located at stores owned
     or operated by Things Remembered or its Subsidiaries and distribution
     centers owned or operated by Things Remembered or its Subsidiaries, in each
     case that consists of inventory other than work in process, excluding all
     Inventory located at a distribution center received from a third-party
     customer in exchange for the initial stocking of Inventory of such
     third-party customer in any changeover or conversion. In determining the
     amount to be so included, the amount of such Inventory shall be valued at
     the lower of cost or market on a basis consistent with such Borrower's or
     such Subsidiary's current and historical accounting practice LESS reserves
     taken, if any, (i) on account of physical inventory adjustments, (ii) for
     warranty and price changes as recorded in such Borrower's or such
     Subsidiary's accounting records, (iii) for any goods returned or rejected
     by such Borrower's or such Subsidiary's customers as damaged or defective,
     scrap, obsolete or otherwise non-salable, return to vendor goods,
     miscellaneous non-perpetual inventory, cores, rental tools or supplies,
     (iv) for goods in transit to third parties that are not excluded pursuant
     to clause (a), (b), (c), (d) or (e) below, (v) for Liens referred to in
     clause (c)(i) below and (vi) for Liens referred to in clause (c)(ii) below
     as established by the Administrative Agent in its reasonable judgment.
     Unless otherwise approved in writing by the Administrative Agent, no
     Inventory shall be deemed Eligible Inventory of the Borrowers or its
     Subsidiaries if:

          (a) the Inventory is not owned solely by such Borrower or such
          Subsidiary or is leased or on consignment or such Borrower or such
          Subsidiary does not have good and valid title thereto;

          (b) the Inventory is not located at or in transit to property that is
          owned or leased by such Borrower or such Subsidiary;

          (c) the Inventory is not subject to a perfected Lien in favor of the
          Administrative Agent prior to all other Liens except for (i) Liens
          arising by operation of law with respect to which either a Landlord
          Consent has been obtained or the amount of Eligible Inventory has been
          reduced by the amount of the applicable Rent Reserve and (ii) with
          respect to Eligible Inventory located at or in transit to sites
          described in clause (b) above, for Liens for normal and customary
          warehousing and transportation charges (appropriate reserves for which
          have been reasonably established for borrowing base purposes by such
          Borrower or such Subsidiary); PROVIDED that in no event shall any
          Inventory which is subject to a Lien permitted by subsection 8.3(m)
          constitute Eligible Inventory;

          (d) the Inventory is not located in the United States; or

          (e) the Inventory does not conform in all material respects to the
          representations and warranties contained in this Agreement or any of
          the Security Documents.

          "ELIGIBLE PROPERTY": at any time, an amount equal to the aggregate
     book value of all tangible assets (other than Inventory) of (i) Cole Vision
     and its Subsidiaries, located at distribution centers, stores and
     laboratories owned or operated by Cole Vision or its

<PAGE>

                                                                              12

     Subsidiaries, (ii) Pearle and its Subsidiaries, located at stores owned or
     operated by Pearle or its Subsidiaries and offices, distribution centers,
     laboratories and other facilities owned or operated by Pearle or its
     Subsidiaries and (iii) Things Remembered and its Subsidiaries, located at
     stores owned or operated by Things Remembered or its Subsidiaries and
     distribution centers owned or operated by Things Remembered or its
     Subsidiaries, in each case less the amount of any Indebtedness (other than
     Indebtedness under any Loan Document) secured by a Lien on such assets,
     PROVIDED that no amount shall be included in any calculation of Eligible
     Property with respect to an asset (i) which is subject to any material
     restrictions on the transfer, assignability or sale thereof, enforceable
     against the assignee (except pursuant to any Loan Document), (ii) upon
     which the Administrative Agent does not have a valid and perfected first
     priority security interest (subject only to (x) Liens of the type described
     in and permitted by Section 8.3(e), (y) Landlord's Liens arising by
     operation of law with respect to which either a Landlord Consent has been
     obtained or the amount of Eligible Property has been reduced by the amount
     of the applicable Rent Reserve and (z) other Liens arising by operation of
     law with respect to which the amount of Eligible Property has been reduced
     by the amount of the obligations secured by such Liens) for the benefit of
     the Lenders or (iii) which does not otherwise conform in all material
     respects to the representations and warranties contained in this Agreement
     or any of the Security Documents.

          "ENVIRONMENTAL COSTS": any and all costs or expenses (including,
     without limitation, reasonable attorney's and consultant's fees,
     investigation and laboratory fees, response costs, court costs and
     litigation expenses, fines, penalties, damages, settlement payments,
     judgments and awards), of whatever kind or nature, contingent or otherwise,
     arising out of, or in any way relating to, any violation of, noncompliance
     with or liability under any Environmental Laws or any orders, requirements,
     demands, or investigations of any person related to any Environmental Laws.
     Environmental Costs include any and all of the foregoing, without regard to
     whether they arise out of or are related to any past, pending or threatened
     proceeding of any kind.

          "ENVIRONMENTAL LAWS": any and all laws, rules, orders, regulations,
     statutes, ordinances, codes, decrees, or other legally enforceable
     requirements (including, without limitation, common law) of any foreign
     government, the United States, or any state, local, municipal or other
     Governmental Authority, regulating, relating to or imposing liability or
     standards of conduct concerning protection of the environment or of human
     health, or employee health and safety, as has been, is now, or may at any
     time hereafter be, in effect.

          "ENVIRONMENTAL PERMITS": any and all permits, licenses, registrations,
     notifications, exemptions and any other authorization required under any
     Environmental Law.

          "ERISA": the Employee Retirement Income Security Act of 1974, as
     amended from time to time.

          "EUROCURRENCY RESERVE REQUIREMENTS": for any day as applied to a
     Eurodollar Loan, the aggregate (without duplication) of the rates
     (expressed as a decimal fraction) of

<PAGE>

                                                                              13

     reserve requirements in effect on such day (including, without limitation,
     basic, supplemental, marginal and emergency reserves under any regulations
     of the Board of Governors of the Federal Reserve System or other
     Governmental Authority having jurisdiction with respect thereto) dealing
     with reserve requirements prescribed for eurocurrency funding (currently
     referred to as "Eurocurrency Liabilities" in Regulation D of such Board)
     maintained by a member bank of such System.

          "EURODOLLAR BASE RATE": with respect to each day during each Interest
     Period pertaining to a Eurodollar Loan, the rate per annum determined by
     the Administrative Agent to be the arithmetic mean of the offered rates for
     deposits in Dollars with a term comparable to such Interest Period that
     appears on the Telerate British Bankers Assoc. Interest Settlement Rates
     Page (as defined below) at approximately 11:00 A.M., London time, on the
     second full Business Day preceding the first day of such Interest Period;
     PROVIDED, HOWEVER, that if there shall at any time no longer exist a
     Telerate British Bankers Assoc. Interest Settlement Rates Page, "Eurodollar
     Base Rate" shall mean, with respect to each day during each Interest Period
     pertaining to a Eurodollar Loan, the rate per annum equal to the rate at
     which CIBC is offered Dollar deposits at or about 10:00 A.M., New York City
     time, two Business Days prior to the beginning of such Interest Period in
     the interbank eurodollar market where the eurodollar and foreign currency
     and exchange operations in respect of its Eurodollar Loans are then being
     conducted for delivery on the first day of such Interest Period for the
     number of days comprised therein and in an amount comparable to the amount
     of its Eurodollar Loan to be outstanding during such Interest Period.
     "TELERATE BRITISH BANKERS ASSOC. INTEREST SETTLEMENT RATES PAGE" shall mean
     the display designated as Page 3750 on the Telerate System Incorporated
     Service (or such other page as may replace such page on such service for
     the purpose of displaying the rates at which Dollar deposits are offered by
     leading banks in the London interbank deposit market).

          "EURODOLLAR LOANS": Revolving Credit Loans the rate of interest
     applicable to which is based upon the Eurodollar Rate.

          "EURODOLLAR RATE": with respect to each day during each Interest
     Period pertaining to a Eurodollar Loan, a rate per annum determined for
     such day in accordance with the following formula (rounded upward to the
     nearest 1/100th of 1%):

                              EURODOLLAR BASE RATE
                    ----------------------------------------
                    1.00 - Eurocurrency Reserve Requirements

          "EVENT OF DEFAULT": any of the events specified in Section 9, PROVIDED
     that any requirement for the giving of notice, the lapse of time, or both,
     or any other condition, has been satisfied.

          "EXCHANGE ACT": the Securities Exchange Act of 1934, as amended.

          "EXISTING CREDIT AGREEMENT": as defined in the recitals hereto.

          "EXCLUDED FOREIGN SUBSIDIARY": any Foreign Subsidiary in respect of
     which either (a) the pledge of all of the Capital Stock of such Subsidiary
     as Collateral or (b) the

<PAGE>

                                                                              14

     guaranteeing by such Subsidiary of the obligations and liabilities of any
     of the Loan Parties hereunder or under any other Loan Documents, would, in
     the good faith judgment of a Borrower, result in adverse tax consequences
     to a Borrower.

          "FEDERAL FUNDS RATE": for any particular date, an interest rate per
     annum equal to the interest rate (rounded upwards, if necessary, to the
     nearest 1/16th of 1%) offered in the interbank market to the Administrative
     Agent as the overnight Federal Funds Rate at or about 10:00 A.M. New York
     City time, on such day (or if such day is not a Business Day, for the next
     preceding Business Day).

          "FINANCING LEASE": any lease of property, real or personal, the
     obligations of the lessee in respect of which are required in accordance
     with GAAP to be capitalized on a balance sheet of the lessee.

          "FOREIGN SUBSIDIARY": any Subsidiary of the Borrower that is treated
     as a corporation for United States tax purposes and that is not a Domestic
     Subsidiary.

          "GAAP": generally accepted accounting principles in the United States
     set forth from time to time in the opinions and pronouncements of the
     Accounting Principles Board and the American Institute of Certified Public
     Accountants and statements and pronouncements of the Financial Accounting
     Standards Board (or agencies with similar functions of comparable stature
     and authority within the accounting profession), or in such other statement
     by such other entity as may be in general use by significant segments of
     the U.S. accounting profession; PROVIDED, that, with respect to the
     calculation of the financial ratios and the terms used in the covenants
     contained in this Agreement and the definitions related thereto, "GAAP"
     means generally accepted accounting principles in effect in the United
     States on the dates of the financial statements referred to in subsection
     5.1, it being understood that, upon any change in GAAP as at such dates
     that in the reasonable opinion of the Administrative Agent affects in any
     material respect the financial ratios and covenants contained in this
     Agreement, the Borrowers and the Administrative Agent, on behalf of the
     Lenders, will negotiate in good faith to adapt or conform any such
     financial ratios and covenants and the definitions related thereto to any
     such changes in GAAP to the extent necessary to maintain the original
     economic terms of such financial ratios and covenants as in effect under
     this Agreement on the date hereof, the Administrative Agent shall promptly
     notify the Lenders in writing of the negotiated changes to such financial
     ratios, covenants and definitions, and if, by the 30th day after the date
     such notice is given (i) the Majority Lenders shall not have objected in
     writing to such changes, such changes shall be deemed to be effective, and
     this Agreement shall be deemed to be amended accordingly, as of such 30th
     day, without further action on the part of any party hereto or (ii) the
     Majority Lenders shall have objected to such changes, then, until this
     Agreement shall be amended in accordance with the terms of Section 11.1 to
     reflect such changes as may be necessary to maintain the original economic
     terms of such financial ratios and covenants, the financial ratios and
     covenants immediately in effect prior to such amendment shall remain in
     effect.

          "GOVERNMENTAL AUTHORITY": any nation or government, any state or other
     political subdivision thereof and any entity (including, without
     limitation, any central bank)

<PAGE>

                                                                              15

     exercising executive, legislative, judicial, regulatory or administrative
     functions of or pertaining to government. For purposes of subsections 4.9,
     4.10 and 11.15, the term "Governmental Authority" shall be deemed to
     include, without limitation, the National Association of Insurance
     Commissioners.

          "GUARANTEE": as defined in the definition of "Guarantor."

          "GUARANTEE AND COLLATERAL AGREEMENT": the Amended and Restated
     Guarantee and Collateral Agreement to be executed and delivered by each
     Borrower and each Subsidiary (other than any Excluded Foreign Subsidiary or
     any other Subsidiary which, in accordance with subsection 7.10(e), is not
     required to execute and deliver such Agreement) in substantially the form
     attached hereto as Exhibit B-1, as the same may be amended, supplemented or
     otherwise modified from time to time.

          "GUARANTEE OBLIGATION": as to any Person (the "GUARANTEEING PERSON"),
     any obligation of (a) the guaranteeing person or (b) another Person
     (including, without limitation, any bank under any letter of credit) to
     induce the creation of which the guaranteeing person has issued a
     reimbursement, counterindemnity or similar obligation, in either case
     guaranteeing or in effect guaranteeing any Indebtedness, leases, dividends
     or other obligations (the "PRIMARY OBLIGATIONS") of any other third Person
     (the "PRIMARY OBLIGOR") in any manner, whether directly or indirectly,
     including, without limitation, any obligation of the guaranteeing person,
     whether or not contingent, (i) to purchase any such primary obligation or
     any property constituting direct or indirect security therefor, (ii) to
     advance or supply funds (1) for the purchase or payment of any such primary
     obligation or (2) to maintain working capital or equity capital of the
     primary obligor or otherwise to maintain the net worth or solvency of the
     primary obligor, (iii) to purchase property, securities or services
     primarily for the purpose of assuring the owner of any such primary
     obligation of the ability of the primary obligor to make payment of such
     primary obligation or (iv) otherwise to assure or hold harmless the owner
     of any such primary obligation against loss in respect thereof; PROVIDED,
     HOWEVER, that the term Guarantee Obligation shall not include endorsements
     of instruments for deposit or collection in the ordinary course of
     business. The amount of any Guarantee Obligation of any guaranteeing person
     shall be deemed to be the lower of (a) an amount equal to the stated or
     determinable amount of the primary obligation in respect of which such
     Guarantee Obligation is made and (b) the maximum amount for which such
     guaranteeing person may be liable pursuant to the terms of the instrument
     embodying such Guarantee Obligation, unless such primary obligation and the
     maximum amount for which such guaranteeing person may be liable are not
     stated or determinable, in which case the amount of such Guarantee
     Obligation shall be such guaranteeing person's maximum reasonably
     anticipated liability in respect thereof as determined by the Borrowers in
     good faith.

          "GUARANTOR": any Person which is now or hereafter a party to (a) the
     Guarantee and Collateral Agreement or the CNC Guarantee or (b) any other
     guarantee (a "GUARANTEE") hereafter delivered to the Administrative Agent
     guaranteeing the obligations and liabilities of each of the Loan Parties
     hereunder or under any other Loan

<PAGE>

                                                                              16

     Documents, including, without limitations, any guarantee delivered pursuant
     to subsection 7.10.

          "HMO SUBSIDIARY": any Subsidiary of a Borrower which, by reason of its
     engagement in the managed vision care business and the operation of
     subsection 7.10(e), is not a Subsidiary Guarantor.

          "INDEBTEDNESS" of any Person means, without duplication, (a) all
     obligations of such Person for borrowed money or with respect to deposits
     or advances of any kind, (b) all obligations of such Person evidenced by
     bonds, debentures, notes or similar instruments, (c) all obligations of
     such Person upon which interest charges are customarily paid, (d) all
     obligations of such Person under conditional sale or other title retention
     agreements relating to property acquired by such Person, (e) all
     obligations of such Person in respect of the deferred purchase price of
     property or services (excluding accounts payable incurred in the ordinary
     course of such Person's business), (f) all Indebtedness of others secured
     by (or for which the holder of such Indebtedness has an existing right,
     contingent or otherwise, to be secured by) any Lien on property owned or
     acquired by such Person, whether or not the Indebtedness secured thereby
     has been assumed, (g) all obligations of such Person under Financing
     Leases, (h) for purposes of subsection 8.2 and Section 9(e), all
     obligations of such Person in respect of interest rate protection
     agreements, interest rate futures, interest rate options, interest rate
     caps and any other interest rate, currency, commodity or other hedging
     arrangement, (i) all Guarantee Obligations of such Person with respect to
     Indebtedness of others, (j) all obligations, contingent or otherwise, of
     such Person as an account party in respect of letters of credit and letters
     of guaranty and (k) all obligations, contingent or otherwise, of such
     Person in respect of bankers' acceptances. The Indebtedness of any Person
     shall include the Indebtedness of any other entity (including any
     partnership in which such Person is a general partner) to the extent such
     Person is liable therefor as a result of such Person's ownership interest
     in or other relationship with such entity, except to the extent the terms
     of such Indebtedness provide that such Person is not liable therefor.

          "INSOLVENCY": with respect to any Multiemployer Plan, the condition
     that such Plan is insolvent within the meaning of Section 4245 of ERISA.

          "INSOLVENT": pertaining to a condition of Insolvency.

          "INTEREST EXPENSE": for any period and without duplication, with
     respect to CNG and its Subsidiaries on a Consolidated basis, (a) the
     aggregate amount of interest which would be set forth opposite the caption
     "interest expense" or any like caption on an income statement for CNG and
     its Subsidiaries on a Consolidated basis, determined in accordance with
     GAAP, for such period plus, to the extent not included in such interest,
     (i) imputed interest included in Financing Leases for such period, (ii) all
     commissions, discounts and other fees and charges owed with respect to
     letters of credit and bankers' acceptance financing permitted by subsection
     8.2 for such period; (iii) the net payments made in connection with
     Interest Rate Protection Agreements for such period, (iv) the interest
     portion of any deferred payment obligation for such period, (v)
     amortization of discount or premium, if any, for such period, (vi) all
     other non-cash interest expense

<PAGE>

                                                                              17

     (other than interest amortized to cost of sales) for such period, (vii) all
     net capitalized interest for such period and (viii) all interest paid under
     any Guarantee Obligation, minus (b) net payments received in connection
     with Interest Rate Protection Agreements for such period, minus (c)
     amortization of deferred financing costs and expenses for such period.

          "INTEREST PAYMENT DATE": (a) as to any ABR Loan, the last day of each
     fiscal quarter of CNG, (b) as to any Eurodollar Loan having an Interest
     Period of three months or less, the last day of such Interest Period, and
     (c) as to any Eurodollar Loan having an Interest Period longer than three
     months, each day which is three months, or a whole multiple thereof, after
     the first day of such Interest Period and the last day of such Interest
     Period.

          "INTEREST PERIOD": with respect to any Eurodollar Loan:

               (i) initially, the period commencing on the borrowing or
          conversion date, as the case may be, with respect to such Eurodollar
          Loan and ending one, two, three or six months thereafter, as selected
          by the respective Borrower in its notice of borrowing or notice of
          conversion, as the case may be, given with respect thereto; and

               (ii) thereafter, each period commencing on the last day of the
          next preceding Interest Period applicable to such Eurodollar Loan and
          ending one, two, three or six months thereafter, as selected by such
          Borrower by irrevocable notice to the Administrative Agent not less
          than three Business Days prior to the last day of the then current
          Interest Period with respect thereto;

     PROVIDED that, all of the foregoing provisions relating to Interest Periods
     are subject to the following:

               (1) if any Interest Period pertaining to a Eurodollar Loan would
          otherwise end on a day that is not a Business Day, such Interest
          Period shall be extended to the next succeeding Business Day unless
          the result of such extension would be to carry such Interest Period
          into another calendar month in which event such Interest Period shall
          end on the immediately preceding Business Day;

               (2) any Interest Period that would otherwise extend beyond the
          Revolving Credit Commitment Termination Date shall end on the
          Revolving Credit Commitment Termination Date;

               (3) any Interest Period pertaining to a Eurodollar Loan that
          begins on the last Business Day of a calendar month (or on a day for
          which there is no numerically corresponding day in the calendar month
          at the end of such Interest Period) shall end on the last Business Day
          of a calendar month; and

               (4) the Borrowers shall select Interest Periods so as not to
          require a payment or prepayment of any Eurodollar Loan during an
          Interest Period for such Revolving Credit Loan.

<PAGE>

                                                                              18

          "INTEREST RATE PROTECTION AGREEMENT": any interest rate protection
     agreement, interest rate future, interest rate option, interest rate cap or
     collar or other interest rate hedge arrangement, to or under which any
     Borrower or any of its Subsidiaries is a party or a beneficiary on the
     Closing Date or becomes a party or a beneficiary after the Closing Date.

          "INVENTORY": as defined in the Uniform Commercial Code as in effect in
     the State of New York; and, with respect to the Borrowers and their
     Subsidiaries, all such Inventory of such Borrower or such Subsidiary
     including, without limitation, all finished goods, wares and merchandise,
     finished or unfinished parts, components, assemblies held for sale to third
     party customers by such Borrower or such Subsidiary.

          "INVESTMENT": as defined in subsection 8.9.

          "ISP 98": the International Standby Practices, International Chamber
     of Commerce Publication No. 590, as the same may be amended from time to
     time.

          "ISSUING LENDER": CIBC or any of its affiliates.

          "LANDLORD CONSENT": a written agreement reasonably acceptable to the
     Administrative Agent, pursuant to which a Person shall waive or subordinate
     its rights and claims as landlord in any Inventory of the Borrowers or
     their Subsidiaries for unpaid rents, grant access to the Administrative
     Agent for the repossession and sale of such inventory and make other
     agreements relative thereto.

          "L/C FEE PAYMENT DATE": the last day of each fiscal quarter of CNG.

          "L/C OBLIGATIONS": at any date, the sum of (a) the aggregate amount
     then available to be drawn under all outstanding Letters of Credit and (b)
     the aggregate amount of drawings under Letters of Credit which have not
     then been reimbursed by the Borrowers pursuant to subsection 3.5.

          "L/C PARTICIPANTS": the collective reference to all the Lenders other
     than the Issuing Lender.

          "L/C SUBLIMIT": $30,000,000.

          "LENDERS": as defined in the preamble hereto and including, without
     limitation, the Issuing Lender.

          "LETTERS OF CREDIT": as defined in subsection 3.1.

          "LETTER OF CREDIT APPLICATION": an application in such form as the
     Issuing Lender may specify from time to time, requesting the Issuing Lender
     to issue a Letter of Credit.

          "LEVERAGE RATIO": as of the end of each fiscal quarter of CNG, with
     respect to CNG and its Subsidiaries on a Consolidated basis, the ratio of
     (a) Total Indebtedness on such date to (b) EBITDA for the twelve month
     period ending on such date.

<PAGE>

                                                                              19

          "LIEN": any mortgage, pledge, hypothecation, deposit arrangement,
     encumbrance, lien (statutory or other), charge or other security interest
     or any preference, priority or other security agreement or preferential
     arrangement of any kind or nature whatsoever (including, without
     limitation, any conditional sale or other title retention agreement and any
     Financing Lease having substantially the same economic effect as any of the
     foregoing).

          "LOAN DOCUMENTS": this Agreement, any Revolving Credit Notes, any
     Letter of Credit Applications, any Letters of Credit, the Security
     Documents and any Guarantees.

          "LOAN PARTIES": CNC, CNG, the Borrowers and each Subsidiary of a
     Borrower which is a party to a Loan Document, individually, a "LOAN PARTY".

          "MAJORITY LENDERS": (i) at such times as each Lender's Revolving
     Credit Commitment Percentage is less than 30%, Non-Defaulting Lenders the
     Revolving Credit Commitment Percentages of which aggregate more than 50% of
     the aggregate Revolving Credit Commitment Percentages of all Non-Defaulting
     Lenders and (ii) at all other times, Non-Defaulting Lenders the Revolving
     Credit Commitment Percentages of which aggregate more than 66-2/3% of the
     aggregate Revolving Credit Commitment Percentages of all Non-Defaulting
     Lenders.

          "MATERIAL ADVERSE EFFECT": a material adverse effect on (a) the
     business, operations, property or condition (financial or otherwise) of the
     Borrowers and their Subsidiaries taken as a whole or (b) the validity or
     enforceability of this Agreement or any of the other Loan Documents or the
     rights or remedies of the Administrative Agent or the Lenders hereunder or
     thereunder.

          "MATERIALS OF ENVIRONMENTAL CONCERN": any gasoline or petroleum
     (including crude oil or any fraction thereof) or petroleum products,
     polychlorinated biphenyls, urea-formaldehyde insulation, asbestos or
     asbestos-containing materials, pollutants, contaminants, radioactivity, and
     any other substances of any kind, whether or not any such substance is
     defined as hazardous or toxic under any Environmental Law, that is
     regulated pursuant to or could give rise to liability under any
     Environmental Law.

          "MOODY'S": as defined in the definition of "Cash Equivalents."

          "MORTGAGES": the mortgages and deeds of trust to be executed and
     delivered or previously executed and delivered by the Borrowers and certain
     Subsidiaries, in a form reasonably satisfactory to the Administrative
     Agent, as the same may be amended, supplemented or otherwise modified from
     time to time.

          "MULTIEMPLOYER PLAN": a Plan which is a multiemployer plan as defined
     in Section 4001(a)(3) of ERISA.

          "NET CASH PROCEEDS": with respect to any sale or other disposition of
     assets by CNG, any Borrower or any of their Subsidiaries or any Recovery
     Event, the net amount equal to the aggregate amount received in cash
     (including any cash received by way of deferred payment pursuant to a note
     receivable, other non-cash consideration or

<PAGE>

                                                                              20

     otherwise, but only as and when such cash is so received) MINUS the sum of
     (i) the reasonable fees, commissions and other out-of-pocket expenses
     incurred by CNG, such Borrower or such Subsidiary in connection therewith,
     (ii) federal, state and local taxes incurred in connection therewith,
     whether payable at such time or thereafter, (iii) in the case of any such
     sale or other disposition of assets subject to a Lien securing any
     Indebtedness (which Lien and Indebtedness are permitted by this Agreement),
     any amounts required to be repaid by CNG, such Borrower or such Subsidiary
     in respect of such Indebtedness (other than Indebtedness under this
     Agreement and any Revolving Credit Notes) in connection with such sale or
     other disposition and (iv) any amounts deposited in escrow or on deposit as
     collateral in respect of environmental or other liabilities not assumed by
     the purchaser in connection with a sale or other disposition of assets, but
     only so long as such amounts remain on deposit or in escrow.

          "NET INCOME": for any period, the aggregate of the net income of CNG
     and its Subsidiaries for such period on a Consolidated basis, determined in
     accordance with GAAP, for such period; PROVIDED, HOWEVER, that there shall
     be excluded from Net Income (a) the net income of a Person whose net income
     is not consolidated with the CNG's under GAAP (other than the amount of
     dividends and other distributions paid or made by such Person to CNG or any
     of its Subsidiaries during such period), (b) the net income of any Person
     for such period acquired in a pooling of interests transaction for any
     period prior to the date of such acquisition, (c) any net gain or loss for
     such period (net of the related tax effect thereof) resulting from any sale
     or other disposition of assets or any sale or other disposition of any
     Capital Stock of any Person by CNG or any of its Subsidiaries, in each
     case, other than in the ordinary course of business and permitted by
     subsection 8.6, (d) extraordinary gains and losses for such period (net of
     the related tax effect thereof), and (e) non-recurring gains and losses for
     such period (net of the related tax effect thereof); PROVIDED that there
     shall be added back to Net Income non-cash restructuring charges deducted
     in calculating Net Income for such period.

          "NON-DEFAULTING LENDER": each Lender other than a Defaulting Lender.

          "NON-EXCLUDED TAXES": as defined in subsection 4.11.

          "OBLIGOR": any purchaser of goods or services or other Person
     obligated to make payment to any Borrower or any Subsidiary in respect of a
     purchase of such goods or services.

          "ORIGINAL CLOSING DATE": the date on which the conditions precedent
     set forth in subsection 6.1 of the Existing Credit Agreement were
     satisfied.

          "PARTICIPANT": as defined in subsection 11.6(b).

          "PBGC": the Pension Benefit Guaranty Corporation established pursuant
     to Subtitle A of Title IV of ERISA.

          "PEARLE": as defined in the preamble hereto.

<PAGE>

                                                                              21

          "PEARLE VISIONCARE LINE OF Credit AGREEMENT": that certain Line of
     Credit Agreement, dated as of January 19, 2001, between Pearle and Pearle
     Visioncare, Inc., including any promissory notes issued thereunder, as
     amended, supplemented or otherwise modified from time to time.

          "PERMITTED HEDGING ARRANGEMENT": as defined in subsection 8.14.

          "PERMITTED HOLDERS": (i) Jeffrey A. Cole, (ii) any employee stock
     ownership plan or any "group" (as defined in Rules 13d-3 and 13d-5 under
     the Exchange Act) in which employees of CNC or its Subsidiaries
     beneficially own at least 25% of the capital stock of CNC owned by such
     group and (iii) any Person that is controlled by any one or more of the
     Persons set forth in (i) or (ii) above.

          "PERSON": an individual, partnership, corporation, limited liability
     company, business trust, joint stock company, trust, unincorporated
     association, joint venture, Governmental Authority or other entity of
     whatever nature.

          "PLAN": at a particular time, any employee benefit plan which is
     covered by ERISA and in respect of which any Borrower or a Commonly
     Controlled Entity is (or, if such plan were terminated at such time, would
     under Section 4069 of ERISA be deemed to be) an "employer" as defined in
     Section 3(5) of ERISA.

          "RECOVERY EVENT": any settlement or payment in respect of any property
     or insurance claim or any condemnation proceeding relating to any asset of
     CNG, any Borrower or any of their Subsidiaries.

          "REGISTER": as defined in subsection 11.6(d).

          "REGULATION U": Regulation U of the Board of Governors of the Federal
     Reserve System as in effect from time to time.

          "REIMBURSEMENT OBLIGATIONS": the obligation of the Borrowers to
     reimburse the Issuing Lender pursuant to subsection 3.5 for amounts drawn
     under Letters of Credit.

          "RENT RESERVE": with respect to any store, distribution center or
     depot where any Inventory subject to Liens arising by operation of law is
     located, a reserve equal to three (3) months' rent at such store,
     distribution center or depot.

          "RENTAL EXPENSE": for any period, the excess, if any, of (i) the
     aggregate amount of fixed rentals payable by CNG, the Borrowers and their
     Subsidiaries for such period, determined on a consolidated basis in
     accordance with GAAP, with respect to leases (other than Financing Leases)
     of real and personal property over (ii) the aggregate amount of fixed
     rental sublease income received by CNG, the Borrowers and their
     Subsidiaries from subleases during such period with respect to such real
     and personal property.

          "REORGANIZATION": with respect to any Multiemployer Plan, the
     condition that such plan is in reorganization within the meaning of Section
     4241 of ERISA.

<PAGE>

                                                                              22

          "REPORTABLE EVENT": any of the events set forth in Section 4043 of
     ERISA, other than those events as to which the thirty day notice period is
     waived under subsections .21, .22, .24, .26, .27 or .28 of PBGC Reg.ss.
     4043.

          "REQUIREMENT OF LAW": as to any Person, the Certificate of
     Incorporation and By-Laws or other organizational or governing documents of
     such Person, and any law, treaty, rule or regulation or determination of an
     arbitrator or a court or other Governmental Authority, in each case
     applicable to or binding upon such Person or any of its property or to
     which such Person or any of its property is subject.

          "RESPONSIBLE OFFICER": the chief executive officer, the president, any
     vice president and the treasurer of CNG.

          "REVOLVING CREDIT COMMITMENT": as to any Lender, its obligation to
     make Revolving Credit Loans to, and/or issue or participate in Letters of
     Credit issued on behalf of, the Borrowers in an aggregate amount not to
     exceed at any one time outstanding the amount set forth under such Lender's
     name in Schedule I opposite the heading "Revolving Credit Commitment" or,
     in the case of any Lender that is an Assignee, the amount of the assigning
     Lender's Revolving Credit Commitment assigned to such Assignee pursuant to
     subsection 11.6 (in each case as such amount may be adjusted from time to
     time as provided herein).

          "REVOLVING CREDIT COMMITMENT PERCENTAGE": as to any Lender, the
     percentage representing a fraction the numerator of which is the Revolving
     Credit Commitment of such Lender (or, following the termination or
     expiration of the Revolving Credit Commitments, the sum of (x) the
     aggregate principal amount of such Lender's Revolving Credit Loans then
     outstanding PLUS (y) such Lender's Revolving Commitment Percentage of all
     L/C Obligations then outstanding), and the denominator of which is the
     aggregate Revolving Credit Commitments of all Lenders (or, following the
     termination or expiration of the Revolving Credit Commitments, the sum of
     (x) the aggregate principal amount of all Revolving Credit Loans then
     outstanding PLUS (y) the aggregate principal amount of all L/C Obligations
     then outstanding).

          "REVOLVING CREDIT COMMITMENT PERIOD": the period from and including
     the Original Closing Date to but not including the Revolving Credit
     Commitment Termination Date.

          "REVOLVING CREDIT COMMITMENT TERMINATION DATE": the earlier of (a) May
     31, 2006 or, if such date is not a Business Day, the Business Day next
     preceding such date and (b) the date upon which the Revolving Credit
     Commitments shall have terminated pursuant hereto.

          "REVOLVING CREDIT LOANS": as defined in subsection 2.1.

          "REVOLVING CREDIT NOTE": as defined in subsection 2.2.

          "SECURITY DOCUMENTS": the collective reference to the Guarantee and
     Collateral Agreement, the CNG Guarantee and Cash Collateral Agreement, the
     Copyright, Patent

<PAGE>

                                                                              23

     and Trademark Security Agreement, the Mortgages and all other security
     documents hereafter delivered to the Administrative Agent granting a Lien
     on any asset or assets of any Person to secure the obligations and
     liabilities of the Borrowers hereunder or under any of the other Loan
     Documents or to secure any guarantee of any such obligations and
     liabilities, including, without limitation, any security document delivered
     pursuant to subsection 7.10.

          "SENIOR SUBORDINATED 1997 NOTES": the 8 5/8% Senior Subordinated Notes
     due 2007 issued by CNG pursuant to the Senior Subordinated 1997 Notes
     Indenture, as the same may be amended, supplemented or otherwise modified
     from time to time without violating Section 9(m).

          "SENIOR SUBORDINATED 1997 NOTES INDENTURE": the Indenture dated as of
     August 22, l997 between CNG and Wells Fargo Bank Minnesota, N.A., formerly
     Norwest Bank Minnesota, N.A., as trustee, pursuant to which the Senior
     Subordinated 1997 Notes have been issued, as the same may be amended,
     supplemented or otherwise modified from time to time without violating
     Section 9(m).

          "SENIOR SUBORDINATED 2002 NOTES": the senior subordinated notes due
     2012 proposed to be issued by CNG pursuant to a Rule 144A offering during
     the second fiscal quarter of 2002 having substantially the same
     subordination provisions as the Senior Subordinated Notes and having other
     terms that, in the reasonable determination of the Administrative Agent,
     are not materially less favorable to the Lenders than those applicable to
     the Senior Subordinated Notes in accordance with the Senior Subordinated
     Notes Indenture (it being agreed that such notes will mature in 2012 and
     will bear interest at a rate per annum based upon market conditions current
     at the time of issuance), as the same may be amended, supplemented or
     otherwise modified from time to time without violating Section 9(m).

          "SENIOR SUBORDINATED 2002 NOTES INDENTURE": the indenture to be
     entered into between CNG and Wells Fargo Bank Minnesota, N.A., formerly
     Norwest Bank Minnesota, N.A., as trustee, pursuant to which the Senior
     Subordinated 2002 Notes will be issued, as the same may be amended,
     supplemented or otherwise modified from time to time without violating
     Section 9(m).

          "SENIOR SUBORDINATED NOTES": the 9.875% Senior Subordinated Notes due
     2006 of CNG issued pursuant to the Senior Subordinated Notes Indenture, as
     the same may be amended, supplemented or otherwise modified from time to
     time without violating Section 9(m).

          "SENIOR SUBORDINATED NOTES INDENTURE": the Indenture dated as of
     November 15, 1996 between CNG and Wells Fargo Bank Minnesota, N.A.,
     formerly Norwest Bank Minnesota, N.A., as trustee, as the same may be
     amended, supplemented or otherwise modified from time to time without
     violating Section 9(m).

<PAGE>

                                                                              24

          "SIGNIFICANT SUBSIDIARY": any Subsidiary that would be a "significant
     subsidiary" as defined in Article 1, Rule 1-02 of Regulation S-X,
     promulgated pursuant to the Securities Act, as such Regulation is in effect
     on the date of this Agreement.

          "SINGLE EMPLOYER PLAN": any Plan which is covered by Title IV of
     ERISA, but which is not a Multiemployer Plan.

          "S&P": as defined in the definition of "Cash Equivalents."

          "SUBSIDIARY": as to any Person, a corporation, partnership, limited
     liability company or other entity of which shares of stock or other
     ownership interests having ordinary voting power (other than stock or such
     other ownership interests having such power only by reason of the happening
     of a contingency) to elect a majority of the board of directors or other
     managers of such corporation, partnership or other entity ("VOTING STOCK")
     are at the time owned, or the management of which is otherwise controlled,
     directly or indirectly through one or more intermediaries, or both, by such
     Person. Unless otherwise qualified, all references to a "Subsidiary" or to
     "Subsidiaries" in this Agreement shall refer to a Subsidiary or
     Subsidiaries of the Borrowers.

          "SUBSIDIARY GUARANTOR": each Subsidiary of CNG other than (a) any
     Excluded Foreign Subsidiary and (b) any other Subsidiary which is not a
     "Guarantor" under the Guarantee and Collateral Agreement or any Guarantee.

          "TAX SHARING AGREEMENT": the Agreement for the Allocation of Federal
     Income Tax Liability and Benefits among Members of the CNC Holding
     Corporation Group dated as of August 23, 1985, as amended by an Agreement
     dated as of December 30, 1986 and as further amended, supplemented or
     otherwise modified from time to time subsequent to the date hereof in a
     manner not adverse to the interests of the Lenders or of CNG or any of its
     Subsidiaries.

          "THINGS REMEMBERED": as defined in the preamble hereto.

          "TOTAL INDEBTEDNESS": on any date, with respect to CNG and its
     Subsidiaries, all Indebtedness of CNG and its Subsidiaries on such date on
     a Consolidated basis (other than Indebtedness in respect of undrawn amounts
     under letters of credit which support obligations of CNG or any of its
     Subsidiaries which do not constitute Indebtedness).

          "TRANCHE": the collective reference to Eurodollar Loans the then
     current Interest Periods with respect to all of which begin on the same
     date and end on the same later date (whether or not such Revolving Credit
     Loans shall originally have been made on the same day).

          "TRANSFEREE": as defined in subsection 11.6(f).

          "TYPE": as to any Revolving Credit Loan, its nature as an ABR Loan or
     a Eurodollar Loan.

          "WACHOVIA": Wachovia Bank, National Association.

<PAGE>

                                                                              25

          "WHOLLY OWNED SUBSIDIARY": means any Subsidiary, all of the
     outstanding voting securities of which are owned, directly or indirectly,
     by a Borrower.

         1.2. OTHER DEFINITIONAL PROVISIONS. (a) Unless otherwise specified
therein, all terms defined in this Agreement shall have the defined meanings
when used in any Revolving Credit Notes, any other Loan Documents or any
certificate or other document made or delivered pursuant hereto.

         (b) As used herein and in any Revolving Credit Notes, any other Loan
Documents and any certificate or other document made or delivered pursuant
hereto, accounting terms relating to CNG, the Borrowers and their Subsidiaries
not defined in subsection 1.1 and accounting terms partly defined in subsection
1.1, to the extent not defined, shall have the respective meanings given to them
under GAAP. Fiscal years referred to in this Agreement are identified according
to the calendar year in which they begin.

         (c) The words "hereof", "herein" and "hereunder" and words of similar
import when used in this Agreement shall refer to this Agreement as a whole and
not to any particular provision of this Agreement, and Section, subsection,
Schedule and Exhibit references are to this Agreement unless otherwise
specified.

         (d) The meanings given to terms defined herein shall be equally
applicable to both the singular and plural forms of such terms.

          SECTION 2. AMOUNT AND TERMS OF REVOLVING CREDIT COMMITMENTS

         2.1. REVOLVING CREDIT COMMITMENTS. (a) Subject to the terms and
conditions hereof, each Lender severally agrees to make revolving credit loans
(each a "REVOLVING CREDIT LOAN", collectively, "REVOLVING CREDIT LOANS") to the
Borrowers, jointly and severally, from time to time during the Revolving Credit
Commitment Period in an aggregate principal amount at any one time outstanding
which, when added to such Lender's Revolving Credit Commitment Percentage of the
then outstanding L/C Obligations, does not exceed the amount of such Lender's
Revolving Credit Commitment. Notwithstanding the foregoing, in no event shall
any Revolving Credit Loans be made or Letters of Credit be issued pursuant to
subsection 3.1 (i) if the aggregate amount of the Revolving Credit Loans to be
made and Letters of Credit to be issued would, after giving effect to the use of
proceeds, if any, thereof, exceed the then aggregate Available Revolving Credit
Commitments or (ii) if, after giving effect to such Revolving Credit Loan or
Letter of Credit, a Borrowing Base Deficiency would exist. During the Revolving
Credit Commitment Period, the Borrowers may use the Revolving Credit Commitments
by borrowing, prepaying the Revolving Credit Loans in whole or in part, and
reborrowing, all in accordance with the terms and conditions hereof, PROVIDED,
HOWEVER, that the Aggregate Outstanding Revolving Credit (other than in respect
of the undrawn portion of any Letters of Credit) with respect to all Lenders at
any time during any consecutive thirty day period during each fiscal year of the
Borrowers (such thirty day period during each fiscal year to be selected by the
Borrowers) may in no event exceed the Clean-Down Amount.

         (b) The Revolving Credit Loans may from time to time be (i) Eurodollar
Loans, (ii) ABR Loans or (iii) a combination thereof, as determined by the
Borrowers and notified to the

<PAGE>

                                                                              26

Administrative Agent in accordance with subsections 2.3 and 4.4, PROVIDED that
no Revolving Credit Loan shall be made as a Eurodollar Loan after the day that
is one month prior to the Revolving Credit Commitment Termination Date.

         2.2. REVOLVING CREDIT NOTES. The Borrowers agree that, upon the request
to the Administrative Agent by any Lender or in connection with any assignment
pursuant to subsection 11.6, to evidence such Lender's Revolving Credit Loans
each Borrower will execute and deliver to such Lender a promissory note
substantially in the form of Exhibit A, with appropriate insertions as to payee,
date and principal amount (each, as amended, supplemented, replaced or otherwise
modified from time to time, a "REVOLVING CREDIT Note"), payable to the order of
such Lender and in a principal amount equal to the lesser of (a) the amount set
forth under such Lender's name in Schedule I opposite the heading "Revolving
Credit Commitment" and (b) the aggregate unpaid principal amount of all
Revolving Credit Loans made by such Lender to such Borrower. Each Revolving
Credit Note shall (x) be dated the Closing Date, (y) be stated to mature on the
Revolving Credit Commitment Termination Date and (z) provide for the payment of
interest in accordance with subsection 4.1.

         2.3. PROCEDURE FOR REVOLVING CREDIT BORROWING. Any Borrower may borrow
under the Revolving Credit Commitments during the Revolving Credit Commitment
Period on any Business Day, PROVIDED that such Borrower shall give the
Administrative Agent irrevocable notice, in substantially the form of Exhibit I
(which notice must be received by the Administrative Agent prior to 11:00 A.M.,
New York City time, (a) three Business Days prior to the requested Borrowing
Date, if all or any part of the requested Revolving Credit Loans are to be
initially Eurodollar Loans or (b) on the requested Borrowing Date, otherwise),
specifying (i) the amount to be borrowed, (ii) the requested Borrowing Date,
(iii) whether the borrowing is to be of Eurodollar Loans, ABR Loans or a
combination thereof and (iv) if the borrowing is to be entirely or partly of
Eurodollar Loans, the respective amount of such Type of Revolving Credit Loan
and the respective length of the initial Interest Period therefor. Each
borrowing under the Revolving Credit Commitments shall be in an amount equal to
(x) in the case of ABR Loans, $500,000 or a whole multiple of $100,000 in excess
thereof (or, if the aggregate Available Revolving Credit Commitments then in
effect are less than $500,000, such lesser amount) and (y) in the case of
Eurodollar Loans, $1,000,000 or a whole multiple of $500,000 in excess thereof.
Upon receipt of any such notice from such Borrower, the Administrative Agent
shall promptly notify each such Lender thereof. Each Lender will make the amount
of its pro rata share of each borrowing available to the Administrative Agent
for the account of such Borrower at the office of the Administrative Agent
specified in subsection 11.2 prior to 1:00 P.M., New York City time, on the
Borrowing Date requested by such Borrower in funds immediately available to the
Administrative Agent. Such borrowing will then be made available to such
Borrower by the Administrative Agent crediting the account of such Borrower on
the books of such office with the aggregate of the amounts made available to the
Administrative Agent by the Lenders and in like funds as received by the
Administrative Agent.

         2.4. COMMITMENT FEES. The Borrowers agree, jointly and severally, to
pay to the Administrative Agent for the account of each Lender, a commitment fee
for the period from and including the first day of the Revolving Credit
Commitment Period to the Revolving Credit Commitment Termination Date, computed
on the average daily amount of the Available Revolving Credit Commitment of such
Lender during the period for which payment is made at

<PAGE>

                                                                              27

the rate per annum set forth under the heading "Commitment Fees" on Schedule II
opposite the percentage which the average daily amount of the Aggregate
Outstanding Revolving Credit of all Lenders constitutes of the aggregate
Revolving Credit Commitments of all Lenders during such payment period, payable
quarterly in arrears on the last day of each fiscal quarter of CNG and on the
Revolving Credit Commitment Termination Date, commencing on the first of such
days to occur after the Closing Date.

         2.5. TERMINATION OR REDUCTION OF REVOLVING CREDIT COMMITMENTS. (a) The
Borrowers shall have the right, upon not less than three Business Days' notice
to the Administrative Agent (which will promptly notify the Lenders thereof), to
terminate the Revolving Credit Commitments or, from time to time, to reduce the
amount of the Revolving Credit Commitments; PROVIDED that no such termination or
reduction shall be permitted if, after giving effect thereto and to any
prepayments of the Revolving Credit Loans made on the effective date thereof,
the aggregate principal amount of the Revolving Credit Loans then outstanding
when added to the sum of the then outstanding L/C Obligations, would exceed the
Revolving Credit Commitments then in effect. Any such reduction shall be in an
amount equal to $1,000,000 or a whole multiple of $500,000 in excess thereof and
shall reduce permanently the Revolving Credit Commitments then in effect.

         (b) The Revolving Credit Commitments shall be automatically reduced in
accordance with subsection 4.3(a). Any such reduction shall reduce permanently
the Revolving Credit Commitments then in effect.

         2.6. REPAYMENT OF REVOLVING CREDIT LOANS. (a) The Borrowers hereby
unconditionally promise, jointly and severally, to pay to the Administrative
Agent, for the account of each Lender, the then unpaid principal amount of each
Revolving Credit Loan of such Lender made to each Borrower on the Revolving
Credit Commitment Termination Date (or such earlier date on which the Revolving
Credit Loans become due and payable pursuant to Section 9). The Borrowers hereby
further agree, jointly and severally, to pay interest on the unpaid principal
amount of the Revolving Credit Loans from time to time outstanding from the date
of the making of the Revolving Credit Loans until payment in full thereof at the
rates per annum, and on the dates, set forth in subsection 4.1.

         (b) Each Lender shall maintain in accordance with its usual practice an
account or accounts evidencing indebtedness of the Borrowers to such Lender
resulting from each Revolving Credit Loan of such Lender from time to time,
including, without limitation, the amounts of principal and interest payable and
paid to such Lender from time to time under this Agreement.

         (c) The Administrative Agent shall maintain the Register pursuant to
subsection 11.6(d), and a subaccount therein for each Lender, in which shall be
recorded (i) the amount of each Revolving Credit Loan made hereunder, the Type
thereof and each Interest Period, if any, applicable thereto, (ii) the amount of
any principal or interest due and payable or to become due and payable from the
Borrowers to each Lender hereunder and (iii) both the amount of any sum received
by the Administrative Agent hereunder from the Borrowers and each Lender's share
thereof.

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                                                                              28

         (d) The entries made in the Register and the accounts of each Lender
maintained pursuant to subsection 2.6(c) shall, to the extent permitted by
applicable law, be PRIMA FACIE evidence of the existence and amounts of the
obligations of the Borrowers therein recorded; PROVIDED, HOWEVER, that the
failure of any Lender or the Administrative Agent to maintain the Register or
any such account, or any error therein, shall not in any manner affect the
obligation of the Borrowers to repay, jointly and severally (with applicable
interest), the Revolving Credit Loans made to any Borrower by such Lender in
accordance with the terms of this Agreement.

                          SECTION 3. LETTERS OF CREDIT

         3.1. L/C COMMITMENT. (a) Subject to the terms and conditions hereof,
the Issuing Lender, in reliance on the agreements of the other Lenders set forth
in subsection 3.4(a), agrees to issue standby letters of credit ("LETTERS OF
CREDIT") for the account of any Borrower on any Business Day during the
Revolving Credit Commitment Period in such form as may be approved from time to
time by the Issuing Lender; provided that the Issuing Lender shall have no
obligation to issue any Letter of Credit if, after giving effect to such
issuance, (i) the L/C Obligations would exceed the L/C Sublimit (ii) the
Available Revolving Credit Commitment of all Lenders would be less than zero or
(iii) a Borrowing Base Deficiency would exist.

         (b) Each Letter of Credit shall (i) be denominated in Dollars, (ii) be
a standby letter of credit issued to support obligations of such Borrower or any
of its Subsidiaries, contingent or otherwise, to finance the working capital and
business needs of such Borrower or any of its Subsidiaries in the ordinary
course of business and (iii) expire no later than the earlier of (x) the date
that is 12 months after the date of its issuance and (y) the fifth Business Day
prior to the Revolving Credit Commitment Termination Date, PROVIDED that any
Letter of Credit with an expiration date of 12 months after the date of its
issuance may provide for the renewal thereof for additional 12 month periods,
but in no event shall the expiration date as extended be later than the fifth
Business Day prior to the Revolving Credit Termination Date.

         (c) Each Letter of Credit shall be subject to ISP 98 and, to the extent
not inconsistent therewith, the laws of the State of New York.

         (d) The Issuing Lender shall not at any time be obligated to issue any
Letter of Credit hereunder if such issuance would conflict with, or cause the
Issuing Lender or any L/C Participant to exceed any limits imposed by, any
applicable Requirement of Law.

         3.2. PROCEDURE FOR ISSUANCE OF LETTERS OF CREDIT. A Borrower may
request that the Issuing Lender issue a Letter of Credit at any time prior to
the fifth Business Day prior to the Revolving Credit Commitment Termination Date
by delivering to the Issuing Lender at its address for notices specified herein
a Letter of Credit Application therefor, completed to the satisfaction of the
Issuing Lender, and such other certificates, documents and other papers and
information as the Issuing Lender may request. Upon receipt of any Letter of
Credit Application, the Issuing Lender will process such Letter of Credit
Application and the certificates, documents and other papers and information
delivered to it in connection therewith in accordance with its customary
procedures and shall promptly issue the Letter of Credit requested thereby (but
in no event shall the Issuing Lender be required to issue any Letter of Credit
earlier than three Business Days after its receipt of the Letter of Credit
Application

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                                                                              29

therefor and all such other certificates, documents and other papers and
information relating thereto) by issuing the original of such Letter of Credit
to the beneficiary thereof or as otherwise may be agreed by the Issuing Lender
and such Borrower. The Issuing Lender shall furnish a copy of such Letter of
Credit to such Borrower promptly following the issuance thereof.

         3.3. FEES, COMMISSIONS AND OTHER CHARGES. (a) The Borrowers shall pay,
jointly and severally, to the Administrative Agent, for the account of the
Issuing Lender and the L/C Participants, a letter of credit fee with respect to
each Letter of Credit, computed for the period from and including the date of
issuance of such Letter of Credit to the expiration date, or earlier
cancellation, of such Letter of Credit (the "L/C PERIOD") at a rate per annum
equal to the Applicable Margin then in effect for Eurodollar Loans calculated on
the basis of the actual number of days elapsed over a 360-day year on the
aggregate face amount of Letters of Credit outstanding, payable in arrears on
each L/C Fee Payment Date and on the Revolving Credit Commitment Termination
Date. Such fee shall be payable to the Administrative Agent to be shared ratably
among the Lenders in accordance with their respective Revolving Credit
Commitment Percentages. In addition, the Borrowers shall pay, jointly and
severally, to the Issuing Lender, for its own account a fee equal to 0.25% per
annum of the aggregate face amount of outstanding Letters of Credit, computed
for the L/C Period, payable quarterly in arrears on each L/C Fee Payment Date
and on the Revolving Credit Commitment Termination Date and calculated on the
basis of the actual number of days elapsed over a 360-day year.

         (b) In addition to the foregoing fees and commissions, the Borrowers
shall pay or reimburse, jointly and severally, the Issuing Lender for such
normal and customary costs and expenses as are incurred or charged by the
Issuing Lender in issuing, effecting payment under, amending or otherwise
administering any Letter of Credit.

         (c) The Administrative Agent shall, promptly following its receipt
thereof, distribute to the Issuing Lender and the L/C Participants all fees and
commissions received by the Administrative Agent for their respective accounts
pursuant to this subsection.

         3.4. L/C PARTICIPATIONS. (a) The Issuing Lender irrevocably agrees to
grant and hereby grants to each L/C Participant, and, to induce the Issuing
Lender to issue Letters of Credit hereunder, each L/C Participant irrevocably
agrees to accept and purchase and hereby accepts and purchases from the Issuing
Lender, on the terms and conditions hereinafter stated, for such L/C
Participant's own account and risk an undivided interest equal to such L/C
Participant's Revolving Credit Commitment Percentage from time to time in effect
in the Issuing Lender's obligations and rights under each Letter of Credit
issued hereunder and the amount of each draft paid by the Issuing Lender
thereunder. Each L/C Participant unconditionally and irrevocably agrees with the
Issuing Lender that, if a draft is paid under any Letter of Credit for which the
Issuing Lender is not reimbursed in full by the Borrowers in accordance with the
terms of this Agreement, such L/C Participant shall pay to the Issuing Lender
upon demand at the Issuing Lender's address for notices specified herein an
amount equal to such L/C Participant's then Revolving Credit Commitment
Percentage of the amount of such draft, or any part thereof, which is not so
reimbursed; provided that, if such demand is made prior to 12:00 Noon, New York
City time, on a Business Day, such L/C Participant shall make such payment to
the Issuing Lender prior to the end of such Business Day and otherwise such L/C
Participant shall make such payment on the next succeeding Business Day.

<PAGE>

                                                                              30

         (b) If any amount required to be paid by any L/C Participant to the
Issuing Lender pursuant to paragraph 3.4(a) in respect of any unreimbursed
portion of any payment made by the Issuing Lender under any Letter of Credit is
paid to the Issuing Lender within three Business Days after the date such
payment is due, such L/C Participant shall pay to the Issuing Lender on demand
an amount equal to the product of (i) such amount, times (ii) the daily average
Federal Funds Rate during the period from and including the date such payment is
required to the date on which such payment is immediately available to the
Issuing Lender, times (iii) a fraction the numerator of which is the number of
days that elapse during such period and the denominator of which is 360. If any
such amount required to be paid by any L/C Participant pursuant to paragraph
3.4(a) is not in fact made available to the Issuing Lender by such L/C
Participant within three Business Days after the date such payment is due, the
Issuing Lender shall be entitled to recover from such L/C Participant, on
demand, such amount with interest thereon calculated from such due date at the
rate per annum applicable to ABR Loans hereunder. A certificate of the Issuing
Lender submitted to any L/C Participant with respect to any amounts owing under
this subsection shall be conclusive in the absence of manifest error.

         (c) Whenever, at any time after the Issuing Lender has made payment
under any Letter of Credit and has received from any L/C Participant its pro
rata share of such payment in accordance with subsection 3.4(a), the Issuing
Lender receives any payment related to such Letter of Credit (whether directly
from a Borrower or otherwise, including proceeds of collateral applied thereto
by the Issuing Lender), or any payment of interest on account thereof, the
Issuing Lender will, if such payment is received prior to 12:00 Noon, New York
City time, on a Business Day, distribute to such L/C Participant its pro rata
share thereof prior to the end of such Business Day and otherwise the Issuing
Lender will distribute such payment on the next succeeding Business Day;
PROVIDED, HOWEVER, that in the event that any such payment received by the
Issuing Lender shall be required to be returned by the Issuing Lender, such L/C
Participant shall return to the Issuing Lender the portion thereof previously
distributed by the Issuing Lender to it.

         3.5. REIMBURSEMENT OBLIGATION OF THE BORROWERS. (a) The Borrowers agree
to reimburse, jointly and severally, the Issuing Lender on the same Business Day
on which a draft is presented under any Letter of Credit and paid by the Issuing
Lender, provided that the Issuing Lender provides notice to the Borrowers prior
to 12:00 Noon, New York City time, on such Business Day and otherwise the
Borrowers will reimburse the Issuing Lender on the next succeeding Business Day;
provided, further, that the failure to provide such notice shall not affect the
Borrowers' absolute and unconditional obligation to reimburse the Issuing Lender
for any draft paid under any Letter of Credit. The Issuing Lender shall provide
notice to the Borrowers on such Business Day as a draft is presented and paid by
the Issuing Lender indicating the amount of (i) such draft so paid and (ii) any
taxes, fees, charges or other costs or expenses incurred by the Issuing Lender
in connection with such payment. Each such payment shall be made to the Issuing
Lender at its address for notices specified herein in lawful money of the United
States of America and in immediately available funds.

         (b) Interest shall be payable on any and all amounts remaining unpaid
by the Borrowers under this subsection from the date such amounts become payable
(whether at stated maturity, by acceleration or otherwise) until payment in full
at the rate which would be payable on any outstanding Revolving Credit Loans
that are ABR Loans which were then overdue.

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                                                                              31

         (c) Each drawing under any Letter of Credit shall constitute a request
by the Borrowers to the Administrative Agent for a borrowing pursuant to
subsection 2.3 of ABR Loans in the amount of such drawing. The Borrowing Date
with respect to such borrowing shall be the date of such drawing.

         3.6. OBLIGATIONS ABSOLUTE. (a) The Borrowers' obligations under this
Section 3 shall be absolute and unconditional under any and all circumstances
and irrespective of any set-off, counterclaim or defense to payment which the
Borrowers may have or have had against the Issuing Lender, any L/C Participant
or any beneficiary of a Letter of Credit.

         (b) The Borrowers also agree with the Issuing Lender that the Issuing
Lender shall not be responsible for, and the Borrowers' Reimbursement
Obligations under subsection 3.5(a) shall not be affected by, among other
things, (i) the validity or genuineness of documents or of any endorsements
thereon, even though such documents shall in fact prove to be invalid,
fraudulent or forged, or (ii) any dispute between or among any Borrower and any
beneficiary of any Letter of Credit or any other party to which such Letter of
Credit may be transferred or (iii) any claims whatsoever of any Borrower against
any beneficiary of such Letter of Credit or any such transferee.

         (c) Neither the Issuing Lender nor any L/C Participant shall be liable
for any error, omission, interruption or delay in transmission, dispatch or
delivery of any message or advice, however transmitted, in connection with any
Letter of Credit, except for errors or omissions caused by the Issuing Lender's
gross negligence or willful misconduct.

         (d) The Borrowers agree that any action taken or omitted by the Issuing
Lender under or in connection with any Letter of Credit or the related drafts or
documents, if done in the absence of gross negligence or willful misconduct and
in accordance with the standards of care specified in the Uniform Commercial
Code of the State of New York, shall be binding on the Borrowers and shall not
result in any liability of the Issuing Lender or any L/C Participant to any
Borrower.

         3.7. LETTER OF CREDIT PAYMENTS. If any draft shall be presented for
payment under any Letter of Credit, the responsibility of the Issuing Lender to
the Borrowers in connection with such draft shall, in addition to any payment
obligation expressly provided for in such Letter of Credit, be limited to
determining that the documents (including each draft) delivered under such
Letter of Credit in connection with such presentment are in conformity with such
Letter of Credit.

         3.8. APPLICATION. To the extent that any provision of any Letter of
Credit Application related to any Letter of Credit is inconsistent with the
provisions of this Agreement or any other Loan Document, the provisions of this
Agreement or such Loan Document shall apply.

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                                                                              32

                         SECTION 4. GENERAL PROVISIONS

         4.1. INTEREST RATES AND PAYMENT DATES. (a) Each Eurodollar Loan shall
bear interest for each day during each Interest Period with respect thereto at a
rate per annum equal to the Eurodollar Rate determined for such day plus the
Applicable Margin.

         (b) Each ABR Loan shall bear interest at a rate per annum equal to the
CIBC Alternate Base Rate plus the Applicable Margin.

         (c) If all or a portion of (i) any principal of any Revolving Credit
Loan, (ii) any interest payable thereon, (iii) any commitment fee or (iv) any
other amount payable hereunder shall not be paid when due (whether at the stated
maturity, by acceleration or otherwise), the principal of the Revolving Credit
Loans and any such overdue interest, commitment fee or other amount shall bear
interest at a rate per annum which is (x) in the case of principal, the rate
that would otherwise be applicable thereto pursuant to the foregoing provisions
of this subsection plus 2% or (y) in the case of any such overdue interest,
commitment fee or other amount, the rate described in paragraph (b) of this
subsection plus 2%, in each case from the date of such non-payment until such
overdue principal, interest, commitment fee or other amount is paid in full (as
well after as before judgment).

         (d) Interest shall be payable in arrears on each Interest Payment Date,
PROVIDED that interest accruing pursuant to paragraph (c) of this subsection
shall be payable from time to time on demand.

         4.2. OPTIONAL PREPAYMENTS. Any Borrower may at any time and from time
to time prepay the Revolving Credit Loans made to it in whole or in part,
without premium or penalty, on any Business Day, PROVIDED that (i) such Borrower
shall have given (x) at least three Business Days' irrevocable notice to the
Administrative Agent (in the case of Eurodollar Loans) or (y) same-day
irrevocable notice to the Administrative Agent (in the case of ABR Loans), (ii)
such notice specifies the date and amount of prepayment and whether the
prepayment is of Eurodollar Loans, ABR Loans or a combination thereof, and, in
each case if a combination thereof, the principal amount allocable to each and
(iii) each prepayment is in a minimum principal amount of $100,000 and a
multiple of $100,000 in excess thereof. Upon the receipt of any such notice the
Administrative Agent shall promptly notify each of the Lenders thereof. If any
such notice is given, the amount specified in such notice shall be due and
payable on the date specified therein, together with any amounts payable
pursuant to subsection 4.12.

         4.3. MANDATORY PREPAYMENTS AND REDUCTION OF REVOLVING CREDIT
COMMITMENTS. (a) If, subsequent to the Closing Date, CNG, any Borrower or any of
their Subsidiaries shall receive Net Cash Proceeds from any sale or other
disposition of assets (other than the sale of inventory in the ordinary course
of business and sales or other dispositions of assets permitted by subsections
8.6(c), (d) or (e)) or from any Recovery Event, then 100% of such Net Cash
Proceeds shall on the first Business Day after receipt thereof be applied toward
the permanent reduction of the Revolving Credit Commitments; PROVIDED that the
first $10,000,000 of such Net Cash Proceeds received after the Closing Date by
CNG, the Borrowers and their Subsidiaries, in the aggregate, shall not be
required to be applied to the permanent reduction of the Revolving Credit
Commitments hereunder unless such Net Cash Proceeds

<PAGE>

                                                                              33

would otherwise be required to be applied to repurchase or redeem the Senior
Subordinated 1997 Notes or the Senior Subordinated 2002 Notes; and PROVIDED,
FURTHER, the Borrowers and their Subsidiaries may use or commit to use any or
all of such Net Cash Proceeds to acquire fixed or capital assets or, in the case
of any Recovery Event, to rebuild or replace the property lost or condemned
within 180 days of receipt of such Net Cash Proceeds and any such Net Cash
Proceeds so used within 180 days of receipt or within 180 days of being
committed to be so used shall not be required to be applied to the permanent
reduction of the Revolving Credit Commitments hereunder, but any such Net Cash
Proceeds not so used shall be applied toward the permanent reduction of the
Revolving Credit Commitments on the earlier of (x) the later of (I) 180th day
after receipt of such Net Cash Proceeds and (II) the 180th day after such Net
Cash Proceeds were committed to be used, as the case may be, and (y) the date on
which the Borrowers have reasonably determined that such Net Cash Proceeds shall
not be so used.

         (b) If, at any time during the Revolving Credit Commitment Period, the
Aggregate Outstanding Revolving Credit with respect to all Lenders exceeds the
aggregate Revolving Credit Commitments then in effect, the Borrowers shall,
without notice or demand, immediately repay the Revolving Credit Loans in an
aggregate principal amount equal to such excess, together with interest accrued
to the date of such payment or prepayment and any amounts payable under
subsection 4.12. To the extent that after giving effect to any prepayment of the
Revolving Credit Loans required by the preceding sentence, the Aggregate
Outstanding Revolving Credit with respect to all Lenders exceeds the aggregate
Revolving Credit Commitments then in effect, the Borrowers shall, without notice
or demand, immediately cash collateralize the then outstanding L/C Obligations
in an amount equal to such excess upon terms reasonably satisfactory to the
Administrative Agent. On the Business Day next succeeding the date on which a
payment has caused the Aggregate Outstanding Revolving Credit with respect to
all Lenders to be equal to or less than the Revolving Credit Commitments then in
effect, the Administrative Agent shall return to the Borrowers the cash used to
cash collateralize the then outstanding L/C Obligations pursuant to the
preceding sentence.

         (c) If, at any time during the Revolving Credit Commitment Period, the
Aggregate Outstanding Revolving Credit (other than in respect of the undrawn
portion of any Letters of Credit) with respect to all Lenders is not less than
the Clean-Down Amount for at least a consecutive thirty day period during each
fiscal year of the Borrowers, the Borrowers shall, without notice or demand,
immediately repay the Revolving Credit Loans in an aggregate principal amount
equal to such excess, together with interest accrued to the date of such payment
or prepayment and any amounts payable under subsection 4.12, and any borrowings
of Revolving Credit Loans during such thirty day period shall be subject to the
proviso to subsection 2.1(a).

         (d) If, at any time during the Revolving Credit Commitment Period, a
Borrowing Base Deficiency shall exist, the Borrowers shall, without notice or
demand, immediately prepay the Revolving Credit Loans in an aggregate principal
amount equal to such Borrowing Base Deficiency, together with interest accrued
to the date of such payment or prepayment and any amounts payable under
subsection 4.12. To the extent that after giving effect to any prepayment of the
Revolving Credit Loans required by the preceding sentence, a Borrowing Base
Deficiency shall continue to exist, the Borrowers shall, without notice or
demand, immediately cash collateralize the then outstanding L/C Obligations in
an amount equal to such Borrowing Base

<PAGE>

                                                                              34

Deficiency upon terms reasonably satisfactory to the Administrative Agent. On
the Business Day next succeeding the date on which a payment has cured such
Borrowing Base Deficiency, the Administrative Agent shall return to the
Borrowers the cash used to cash collateralize the then outstanding L/C
Obligations pursuant to the preceding sentence.

         4.4. CONVERSION AND CONTINUATION OPTIONS. (a) The Borrowers may elect
from time to time to convert Eurodollar Loans to ABR Loans by giving the
Administrative Agent at least three Business Days' prior irrevocable notice of
such election, in substantially the form of Exhibit J, PROVIDED that any such
conversion of Eurodollar Loans may only be made on the last day of an Interest
Period with respect thereto. The Borrowers may elect from time to time to
convert ABR Loans to Eurodollar Loans by giving the Administrative Agent at
least three Business Days' prior irrevocable notice of such election. Any such
notice of conversion to Eurodollar Loans shall specify the length of the initial
Interest Period or Interest Periods therefor. Upon receipt of any such notice
the Administrative Agent shall promptly notify each Lender thereof. All or any
part of outstanding Eurodollar Loans and ABR Loans may be converted as provided
herein, PROVIDED that (i) unless the Majority Lenders otherwise consent, no
Revolving Credit Loan may be converted into a Eurodollar Loan when any Event of
Default has occurred and is continuing and (ii) no Revolving Credit Loan may be
converted into a Eurodollar Loan after the date that is one month prior to the
Revolving Credit Commitment Termination Date.

         (b) Any Eurodollar Loans may be continued as such upon the expiration
of the then current Interest Period with respect thereto by the respective
Borrower giving notice to the Administrative Agent, in substantially the form of
Exhibit J, in accordance with the applicable provisions of the term "Interest
Period" set forth in subsection 1.1, of the length of the next Interest Period
to be applicable to such Revolving Credit Loans, PROVIDED that no Eurodollar
Loan may be continued as such (i) unless the Majority Lenders otherwise consent,
when any Event of Default has occurred and is continuing or (ii) after the date
that is one month prior to the Revolving Credit Commitment Termination Date and
PROVIDED, FURTHER, that if such Borrower shall fail to give such notice or if
such continuation is not permitted such Revolving Credit Loans shall be
automatically converted to ABR Loans on the last day of such then expiring
Interest Period.

         4.5. MINIMUM AMOUNTS AND MAXIMUM NUMBER OF TRANCHES. All borrowings,
conversions and continuations of Revolving Credit Loans hereunder and all
selections of Interest Periods hereunder shall be in such amounts and be made
pursuant to such elections so that, after giving effect thereto, the aggregate
principal amount of the Revolving Credit Loans comprising each Tranche shall be
equal to $1,000,000 or a whole multiple of $500,000 in excess thereof. In no
event shall there be more than 15 Tranches outstanding at any time.

         4.6. COMPUTATION OF INTEREST AND FEES. (a) Interest (other than
interest based on the CIBC Prime Rate) on all Revolving Credit Loans and
commitment fees payable pursuant hereto shall be calculated on the basis of a
year of 360 days for the actual days elapsed; interest based on the CIBC Prime
Rate shall be calculated on the basis of a 365-(or 366-, as the case may be) day
year for the actual days elapsed. The Administrative Agent shall as soon as
practicable notify the Borrowers and the Lenders of each determination of a
Eurodollar Rate. Any change in the interest rate on the Revolving Credit Loans
resulting from a change in the CIBC Alternate Base Rate or the Eurocurrency
Reserve Requirements shall become effective as of the opening of

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                                                                              35

business on the day on which such change shall become effective, PROVIDED that
such change becomes effective prior to 5:00 P.M., New York City time, on such
day. The Administrative Agent shall as soon as practicable notify the Borrowers
and each Lender of the effective date and the amount of each such change.

         (b) Each determination of an interest rate by the Administrative Agent
pursuant to any provision of this Agreement shall be conclusive and binding on
the Borrowers and the Lenders in the absence of manifest error. The
Administrative Agent shall, at the request of the Borrowers, deliver to the
Borrowers a statement showing the quotations used by the Administrative Agent in
determining any interest rate pursuant to subsection 4.1.

         4.7. INABILITY TO DETERMINE INTEREST RATE. If prior to the first day of
any Interest Period: (a) the Administrative Agent shall have determined (which
determination shall be conclusive and binding upon the Borrowers) that, by
reason of circumstances affecting the relevant market, adequate and reasonable
means do not exist for ascertaining the Eurodollar Rate for such Interest
Period, or (b) the Administrative Agent shall have received notice from the
Majority Lenders that the Eurodollar Rate determined or to be determined for
such Interest Period will not adequately and fairly reflect the cost to such
Lenders (or any affiliate of any such Lender from which such Lender customarily
obtains funds) (as conclusively certified by such Lenders) of making or
maintaining their affected Revolving Credit Loans during such Interest Period,
then the Administrative Agent shall give telecopy or telephonic notice thereof
to the Borrowers and the Lenders as soon as practicable thereafter. If such
notice is given (x) any Eurodollar Loans requested to be made on the first day
of such Interest Period shall be made as ABR Loans, (y) any ABR Loans that were
to have been converted on the first day of such Interest Period to Eurodollar
Loans shall be continued as ABR Loans and (z) any outstanding Eurodollar Loans
shall be converted, on the first day of such Interest Period, to ABR Loans.
Until such notice has been withdrawn by the Administrative Agent, no further
Eurodollar Loans shall be made or continued as such, nor shall the Borrowers
have the right to convert ABR Loans to Eurodollar Loans.

         4.8. PRO RATA TREATMENT AND PAYMENTS. (a) Each borrowing of Revolving
Credit Loans by any Borrower from the Lenders hereunder shall be made, each
payment by any Borrower on account of any commitment fee in respect of the
Revolving Credit Commitments hereunder shall be allocated by the Administrative
Agent, and any reduction of the Revolving Credit Commitments of the Lenders
shall be allocated by the Administrative Agent, PRO RATA according to the
Revolving Credit Commitment Percentages of the Lenders. Each payment (including
each prepayment) by any Borrower on account of principal of and interest on any
Revolving Credit Loan shall be allocated by the Administrative Agent PRO RATA
according to the respective outstanding principal amounts of such Revolving
Credit Loans then held by the Lenders. All payments (including prepayments) to
be made by the Borrowers hereunder and under any Revolving Credit Notes, whether
on account of principal, interest, fees, Reimbursement Obligations or otherwise,
shall be made without set-off or counterclaim and shall be made prior to 2:30
p.m., New York City time, on the due date thereof to the Administrative Agent,
for the account of the Lenders holding the relevant Revolving Credit Loans or
the L/C Participants, as the case may be, at the Administrative Agent's office
specified in subsection 11.2, in Dollars and in immediately available funds.
Payments received by the Administrative Agent after such time shall be deemed to
have been received on the next

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                                                                              36

Business Day. If any payment hereunder (other than payments on Eurodollar Loans)
becomes due and payable on a day other than a Business Day, the maturity of such
payment shall be extended to the next succeeding Business Day, and, with respect
to payments of principal, interest thereon shall be payable at the then
applicable rate during such extension. If any payment on a Eurodollar Loan
becomes due and payable on a day other than a Business Day, the maturity of such
payment shall be extended to the next succeeding Business Day (and, with respect
to payments of principal, interest thereon shall be payable at the then
applicable rate during such extension) unless the result of such extension would
be to extend such payment into another calendar month, in which event such
payment shall be made on the immediately preceding Business Day.

         (b) Unless the Administrative Agent shall have been notified in writing
by any Lender prior to a borrowing that such Lender will not make the amount
that would constitute its Revolving Credit Commitment Percentage of such
borrowing available to the Administrative Agent, the Administrative Agent may
assume that such Lender is making such amount available to the Administrative
Agent, and the Administrative Agent may, in reliance upon such assumption, make
available to the Borrowers a corresponding amount. If such amount is not made
available to the Administrative Agent by the required time on the Borrowing Date
therefor and the Administrative Agent shall have advanced such amount to the
Borrowers, such Lender shall pay to the Administrative Agent, on demand, such
amount with interest thereon at a rate equal to the daily average Federal Funds
Rate for the period until such Lender makes such amount immediately available to
the Administrative Agent, PROVIDED that if such Lender's Revolving Credit
Commitment Percentage of such borrowing is not made available to the
Administrative Agent by such Lender within three Business Days of such Borrowing
Date, the Administrative Agent shall also be entitled to recover such amount
with interest thereon at the rate per annum applicable to ABR Loans hereunder,
on demand, from the Borrowers. A certificate of the Administrative Agent
submitted to any Lender with respect to any amounts owing under this subsection
shall be conclusive in the absence of manifest error.

         4.9. ILLEGALITY. Notwithstanding any other provision herein, if the
adoption after the date of this Agreement of or any change after the date of
this Agreement in any Requirement of Law or in the interpretation or application
thereof shall make it unlawful for any Lender (or any affiliate of such Lender
from which such Lender customarily obtains funds) to make or maintain Eurodollar
Loans as contemplated by this Agreement, (a) the commitment of such Lender
hereunder to make Eurodollar Loans, continue Eurodollar Loans as such and
convert ABR Loans to Eurodollar Loans shall forthwith be cancelled and (b) such
Lender's Revolving Credit Loans then outstanding as Eurodollar Loans, if any,
shall be converted automatically to ABR Loans on the respective last days of the
then current Interest Periods with respect to such Revolving Credit Loans or
within such earlier period as required by law. If any such conversion of a
Eurodollar Loan occurs on a day which is not the last day of the then current
Interest Period with respect thereto, the Borrowers shall pay to such Lender
such amounts, if any, as may be required pursuant to subsection 4.12.

         4.10. REQUIREMENTS OF LAW. (a) If the adoption after the date of this
Agreement of or any change after the date of this Agreement in any Requirement
of Law or in the interpretation or application thereof or compliance by any
Lender with any request or directive

<PAGE>

                                                                              37

(whether or not having the force of law) from any central bank or other
Governmental Authority made subsequent to the date hereof:

               (i) shall subject any Lender to any tax of any kind whatsoever
          with respect to this Agreement, any Note, any Letter of Credit, any
          Letter of Credit Application or any Eurodollar Loan made by it, or
          change the basis of taxation of payments to such Lender in respect
          thereof (except for Non-Excluded Taxes covered by subsection 4.11 and
          changes in the rate of tax on the overall net income of such Lender);

               (ii) shall impose, modify or hold applicable any reserve, special
          deposit, compulsory loan or similar requirement against assets held
          by, deposits or other liabilities in or for the account of, advances,
          loans or other extensions of credit by, or any other acquisition of
          funds by, any office of such Lender (or any affiliate of such Lender
          from which such Lender customarily obtains funds) which is not
          otherwise included in the determination of the Eurodollar Rate
          hereunder; or

               (iii) shall impose on such Lender (or such affiliate) any other
          condition;

and the result of any of the foregoing is to increase the cost to such Lender,
by an amount which such Lender deems to be material, of making, converting into,
continuing or maintaining Eurodollar Loans or issuing or participating in
Letters of Credit or to reduce any amount receivable hereunder in respect
thereof, then, in any such case, the Borrowers shall promptly upon demand pay
such Lender such additional amount or amounts as will compensate such Lender for
such increased cost or reduced amount receivable.

         (b) If any Lender shall have determined that the adoption after the
date of this Agreement of or any change after the date of this Agreement in any
Requirement of Law regarding capital adequacy or in the interpretation or
application thereof or compliance by such Lender or any corporation controlling
such Lender with any request or directive regarding capital adequacy (whether or
not having the force of law) from any Governmental Authority made subsequent to
the date hereof shall have the effect of reducing the rate of return on such
Lender's or such corporation's capital as a consequence of its obligations
hereunder or under any Letter of Credit to a level below that which such Lender
or such corporation could have achieved but for such adoption, change or
compliance (taking into consideration such Lender's or such corporation's
policies with respect to capital adequacy) by an amount deemed by such Lender to
be material, then from time to time upon demand, the Borrowers shall promptly
pay to such Lender such additional amount or amounts as will compensate such
Lender or such corporation for such reduction.

         (c) If any Lender becomes entitled to claim any additional amounts
pursuant to this subsection, such Lender shall promptly notify the Borrowers
(with a copy to the Administrative Agent) of the event by reason of which it has
become so entitled. A certificate as to any additional amounts payable pursuant
to this subsection, and the calculation thereof, submitted by such Lender to the
Borrowers (with a copy to the Administrative Agent) shall be conclusive in the
absence of manifest error. The agreements in this subsection shall survive the

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                                                                              38

termination of this Agreement and the payment of the Revolving Credit Loans and
all other amounts payable hereunder.

         4.11. TAXES. (a) All payments made by the Borrowers under this
Agreement, any Revolving Credit Notes, any Letters of Credit or any Letter of
Credit Applications shall be made free and clear of, and without deduction or
withholding for or on account of, any present or future income, stamp or other
taxes, levies, imposts, duties, charges, fees, deductions or withholdings, now
or hereafter imposed, levied, collected, withheld or assessed by any
Governmental Authority, excluding net income taxes and franchise taxes (imposed
in lieu of net income taxes) imposed on the Administrative Agent or any Lender
as a result of a present or former connection between the Administrative Agent
or such Lender and the jurisdiction of the Governmental Authority imposing such
tax or any political subdivision or taxing authority thereof or therein (other
than any such connection arising solely from the Administrative Agent or such
Lender having executed, delivered or performed its obligations or received a
payment under, or enforced, this Agreement or any Revolving Credit Note). If any
such non-excluded taxes, levies, imposts, duties, charges, fees, deductions or
withholdings ("NON-EXCLUDED TAXES") are required to be withheld from any amounts
payable to the Administrative Agent or any Lender hereunder or under any
Revolving Credit Note, any Letters of Credit or any Letter of Credit
Applications, the amounts so payable to the Administrative Agent or such Lender
shall be increased to the extent necessary to yield to the Administrative Agent
or such Lender (after payment of all Non-Excluded Taxes) interest or any such
other amounts payable hereunder at the rates or in the amounts specified in this
Agreement, PROVIDED, HOWEVER, that the Borrowers shall not be required to
increase any such amounts payable to any Lender that is not organized under the
laws of the United States of America or a state thereof if such Lender fails to
comply with the requirements of paragraph (b) of this subsection. Whenever any
Non-Excluded Taxes are payable by any Borrower, as promptly as possible
thereafter such Borrower shall send to the Administrative Agent for its own
account or for the account of such Lender, as the case may be, a certified copy
of an original official receipt received by such Borrower showing payment
thereof or, if an official receipt cannot be obtained with commercially
reasonable effort, other evidence of payment reasonably acceptable to the
Administrative Agent or such Lender. If any Borrower fails to pay any
Non-Excluded Taxes when due to the appropriate taxing authority or fails to
remit to the Administrative Agent the required receipts or other required
documentary evidence after receiving appropriate notification of such tax
liability from the affected Lender(s), the Borrowers shall indemnify, jointly
and severally, the Administrative Agent and the Lenders for any incremental
Non-Excluded Taxes, interest or penalties that may become payable by the
Administrative Agent or any Lender as a result of any such failure. The
agreements in this subsection shall survive the termination of this Agreement
and the payment of the Revolving Credit Loans and all other amounts payable
hereunder.

         (b) Each Lender that is not incorporated under the laws of the United
States of America or a state thereof shall:

         (X) except as otherwise provided in clause (Y) below,

               (i) deliver to the Borrowers and the Administrative Agent (on or
          before the date of any payment by the Borrowers) two duly completed
          copies of

<PAGE>

                                                                              39

          Internal Revenue Service Form W-8BEN, W-8ECI, other applicable form,
          or successor applicable form, as the case may be;

               (ii) deliver to the Borrowers and the Administrative Agent two
          further copies of any such form or certification on or before the date
          that any such form or certification expires or becomes obsolete and
          after the occurrence of any event requiring a change in the most
          recent form previously delivered by it to the Borrowers; and

               (iii) obtain such extensions of time for filing and complete such
          forms or certifications as may reasonably be requested by the
          Borrowers or the Administrative Agent; or

         (Y) in the case of any such Lender that is not a "bank" within the
meaning of Section 881(c)(3)(A) of the Code, (i) represent to the Borrowers (for
the benefit of the Borrowers and the Administrative Agent) that it is not a bank
within the meaning of Section 881(c)(3)(A) of the Code, (ii) agree to furnish to
the Borrowers on or before the date of any payment by the Borrowers, with a copy
to the Administrative Agent, (A) a certificate substantially in the form of
Exhibit E (any such certificate a "U.S. TAX COMPLIANCE CERTIFICATE") and (B) two
accurate and complete original signed copies of Internal Revenue Service Form
W-8 BEN, or successor applicable form certifying to such Lender's legal
entitlement at the date of such certificate to an exemption from U.S.
withholding tax under the provisions of Section 881(c) of the Code with respect
to payments to be made under this Agreement and any Revolving Credit Notes (and
to deliver to the Borrowers and the Administrative Agent two further copies of
such form on or before the date it expires or becomes obsolete and after the
occurrence of any event requiring a change in the most recently provided form
and, if necessary, obtain any extensions of time reasonably requested by the
Borrowers or the Administrative Agent for filing and completing such forms), and
(iii) agree, to the extent legally entitled to do so, upon reasonable request by
the Borrowers, to provide to the Borrowers (for the benefit of the Borrowers and
the Administrative Agent) such other forms as may be reasonably required in
order to establish the legal entitlement of such Lender to an exemption from
withholding with respect to payments under this Agreement and any Revolving
Credit Notes, PROVIDED that in determining the reasonableness of a request under
this clause (iii) such Lender shall be entitled to consider the cost (to the
extent unreimbursed by the Borrowers) which would be imposed on such Lender of
complying with such request;

unless in any such case any change in treaty, law or regulation has occurred
after the date such Person becomes a Lender hereunder which renders all such
forms inapplicable or which would prevent such Lender from duly completing and
delivering any such form with respect to it and such Lender so advises the
Borrowers and the Administrative Agent. Each non-United States Person that shall
become a Lender or a Participant pursuant to subsection 11.6 shall, upon the
effectiveness of the related transfer, be required to provide all of the forms,
certifications and statements required pursuant to this subsection, PROVIDED
that in the case of a Participant the obligations of such Participant pursuant
to this paragraph (b) shall be determined as if such Participant were a Lender
except that such Participant shall furnish all such required forms,

<PAGE>

                                                                              40

certifications and statements to the Lender from which the related participation
shall have been purchased.

         4.12. INDEMNITY. The Borrowers agree to indemnify, jointly and
severally, each Lender and to hold each Lender harmless from any loss or expense
which such Lender may sustain or incur as a consequence of (a) default by any
Borrower in making a borrowing of, conversion into or continuation of Eurodollar
Loans after such Borrower has given a notice requesting the same in accordance
with the provisions of this Agreement, (b) default by any Borrower in making any
prepayment of Eurodollar Loans after such Borrower has given a notice thereof in
accordance with the provisions of this Agreement or (c) the making of a
prepayment of Eurodollar Loans on a day which is not the last day of an Interest
Period with respect thereto. Such indemnification may include an amount equal to
the excess, if any, of (i) the amount of interest which would have accrued on
the amount so prepaid, or not so borrowed, converted or continued, for the
period from the date of such prepayment or of such failure to borrow, convert or
continue to the last day of such Interest Period (or, in the case of a failure
to borrow, convert or continue, the Interest Period that would have commenced on
the date of such failure) in each case at the applicable rate of interest for
such Revolving Credit Loans provided for herein (excluding, however, the
Applicable Margin included therein, if any) over (ii) the amount of interest (as
reasonably determined by such Lender) which would have accrued to such Lender on
such amount by placing such amount on deposit for a comparable period with
leading banks in the interbank eurodollar market. This covenant shall survive
the termination of this Agreement and the payment of the Revolving Credit Loans
and all other amounts payable hereunder.

         4.13. CHANGE OF LENDING OFFICE; REPLACEMENT OF LENDERS. (a) Each Lender
agrees that if it makes any demand for payment under subsection 4.10 or 4.11(a),
or if any adoption or change of the type described in subsection 4.9 shall occur
with respect to it, it shall use reasonable efforts (consistent with its
internal policy and legal and regulatory restrictions and so long as such
efforts would not be disadvantageous to it, as determined in its sole
discretion) to designate a different lending office if the making of such a
designation would reduce or obviate the need for the Borrowers to make payments
under subsection 4.10 or 4.11(a), or would eliminate or reduce the effect of any
adoption or change described in subsection 4.9.

         (b) If at any time any Lender (i) makes any demand for payment under
subsection 4.10 or 4.11(a) as a result of any condition described in any such
subsection, (ii) is subject to any adoption or change of the type described in
Section 4.9, or (iii) becomes a Defaulting Lender, then the Borrowers may, if
such condition continues to exist after such Lender shall have used reasonable
efforts pursuant to paragraph (a) of this subsection 4.13 (in the circumstances
described in the preceding clause (i)) or such Lender continues to be a
Defaulting Lender (in the circumstances described in the preceding clause (ii))
and on ten Business Days' prior written notice to the Administrative Agent and
such Lender, replace such Lender by causing such Lender to (and such Lender
shall) assign pursuant to subsection 11.6 (c) all of its rights and obligations
under this Agreement to another Lender or other bank or financial institution
selected by the Borrowers and acceptable to the Administrative Agent for a
purchase price equal to the outstanding principal amount of all Revolving Credit
Loans and all Reimbursement Obligations, accrued interest, fees and other
amounts owing to such Lender; PROVIDED that (i) the Borrowers shall have no
right to replace the Administrative Agent, (ii) neither the Administrative Agent
nor any Lender shall have any obligation to the Borrowers to find a replacement
Lender or other

<PAGE>

                                                                              41

bank or financial institution, (iii) such replacement must take place no later
than 180 days after such Lender shall have made any such demand for payment or
shall have become a Defaulting Lender, as the case may be, (iv) in no event
shall any Lender hereby replaced be required to pay or surrender to such
replacement Lender or other bank or financial institution any of the fees
received by such Lender pursuant to this Agreement, (v) the Borrowers shall pay
such amounts demanded under subsection 4.10 or 4.11(a) to such Lender, together
with any amounts as may be required pursuant to subsection 4.12, prior to such
Lender being replaced and the payment of such amounts shall be a condition to
the replacement of such Lender and (vi) such Lender shall not be required to pay
any fees required by subsection 11.6(e) in connection with such replacement.

                   SECTION 5. REPRESENTATIONS AND WARRANTIES

         To induce the Administrative Agent and the Lenders to enter into this
Agreement and to make the Revolving Credit Loans and issue or participate in the
Letters of Credit, each Borrower hereby represents and warrants, on the Closing
Date and on any date thereafter on which any Revolving Credit Loan or any other
extension of credit is requested to be made by any Lender or on which any Letter
of Credit is requested to be issued by the Issuing Lender, to the Administrative
Agent and each Lender that:

         5.1. FINANCIAL CONDITION. The Consolidated balance sheets of CNG and
its Subsidiaries as of January 29, 2000, February 3, 2001 and February 2, 2002
and the related Consolidated statements of income and of cash flows for the
fiscal years ended on such dates, reported on by Arthur Andersen LLP, copies of
which have heretofore been furnished to each Lender, present fairly the
Consolidated financial condition of CNG and its Subsidiaries as at such dates,
and the Consolidated results of their operations and their Consolidated cash
flows for the fiscal years then ended. The unaudited Consolidated balance sheet
of CNG and its Subsidiaries as at March 30, 2002, the related unaudited
Consolidated income statement for the one-month period ended on such date and
the related unaudited Consolidated statement of cash flows for the portion of
the fiscal year through such date, certified by a Responsible Officer, copies of
which have heretofore been furnished to each Lender, present fairly the
Consolidated financial condition of CNG and its Subsidiaries as at such date,
and the Consolidated results of their operations and their Consolidated cash
flows for the respective periods covered by such statements then ended (subject
to normal year-end audit adjustments). All such financial statements, including
the related schedules and notes thereto, have been prepared in accordance with
GAAP applied consistently throughout the periods involved (except as approved by
such accountants or Responsible Officer, as the case may be, and as disclosed
therein). Neither CNG nor any of its Subsidiaries had, at February 2, 2002, any
material Guarantee Obligation, contingent liability or liability for taxes, or
any long-term lease or other material agreement or unusual forward or long-term
commitment, including, without limitation, any interest rate or foreign currency
swap or exchange transaction, which is not reflected in the foregoing statements
or in the notes thereto or in Schedule 5.1. During the period from February 2,
2002 to and including the Closing Date there has been no sale, transfer or other
disposition by CNG or any of its Subsidiaries of any material part of its
business or property and no purchase or other acquisition of any business or
property (including any capital stock of any other Person) material in relation
to the Consolidated financial condition of CNG and its Subsidiaries at February
2, 2002.

<PAGE>

                                                                              42

         5.2. NO CHANGE; SOLVENCY. Since February 2, 2002 there has been no
development or event which has had or could reasonably be expected to have a
Material Adverse Effect. As of the Closing Date, after giving effect to the
transactions contemplated by the Loan Documents, the Borrowers and their
Subsidiaries are solvent, on a Consolidated basis and on an individual basis.

         5.3. CORPORATE EXISTENCE; COMPLIANCE WITH LAW. Each of the Borrowers
and the other Loan Parties (a) is duly organized, validly existing and in good
standing under the laws of the jurisdiction of its organization, (b) has the
corporate or other necessary power and authority, and the legal right, to own
and operate its property, to lease the property it operates as lessee and to
conduct the business in which it is currently engaged, (c) is duly qualified to
do business and in good standing under the laws of each jurisdiction where its
ownership, lease or operation of property or the conduct of its business
requires such qualification, except for jurisdictions in which the failure to so
qualify, in the aggregate, could not reasonably be expected to have a Material
Adverse Effect, and (d) is in compliance with all Requirements of Law except to
the extent that the failure to comply therewith could not, in the aggregate,
reasonably be expected to have a Material Adverse Effect.

         5.4. CORPORATE POWER; AUTHORIZATION; ENFORCEABLE OBLIGATIONS. Each of
the Borrowers and the other Loan Parties has the corporate or other necessary
power and authority, and the legal right, to execute, deliver and perform the
Loan Documents to which it is a party and, in the case of each Borrower, to
borrow hereunder and each of the Borrowers and the other Loan Parties has taken
all necessary corporate action to authorize the borrowings on the terms and
conditions of this Agreement and any Revolving Credit Notes and to authorize the
execution, delivery and performance of the Loan Documents to which it is a
party. No consent or authorization of, filing with, notice to or other act by or
in respect of, any Governmental Authority or any other Person is required to be
received, made, given or completed by any of the Loan Parties in connection with
the borrowings hereunder or with the execution, delivery, performance, validity
or enforceability of the Loan Documents to which any Borrower or any of the
other Loan Parties is a party other than filings and recordings to perfect the
security interest of the Lenders created by the Security Documents and other
than those set forth on Schedule 5.4. All of such consents, authorizations,
filings, notices and other acts set forth on Schedule 5.4 have been heretofore
received, made, given or completed except for such consents, authorizations,
filings, notices and other acts that a Borrower's or other Loan Party's failure
to receive, make, give or complete could not reasonably be expected to have a
Material Adverse Effect. This Agreement has been duly executed and delivered by
each Borrower, and each of the other Loan Documents to which each Borrower or
any of the other Loan Parties is a party has been duly executed and delivered by
such Borrower or such other Loan Party. This Agreement constitutes a legal,
valid and binding obligation of each Borrower, and each other Loan Document to
which each Borrower or any of the other Loan Parties is a party constitutes a
legal, valid and binding obligation of such Borrower or such other Loan Party,
enforceable against such Borrower or such other Loan Party in accordance with
its terms, subject to the effects of bankruptcy, insolvency, fraudulent
conveyance, reorganization, moratorium and other similar laws relating to or
affecting creditors' rights generally, general equitable principles (whether
considered in a proceeding in equity or at law) and an implied covenant of good
faith and fair dealing.

<PAGE>

                                                                              43

         5.5. NO LEGAL BAR. The execution, delivery and performance of the Loan
Documents to which any Borrower or any of the other Loan Parties is a party, the
borrowings hereunder and the use of the proceeds thereof will not violate any
Requirement of Law or Contractual Obligation of any Borrower or of any of the
other Loan Parties and will not result in, or require, the creation or
imposition of any Lien on any of its or their respective properties or revenues
pursuant to any such Requirement of Law or Contractual Obligation (other than
the Loan Documents). Schedule 5.5 constitutes a complete list as of the date
hereof of all material Contractual Obligations to which any Loan Party is a
party and all orders and decrees of courts which are applicable to or binding on
any Loan Party or to which any Loan Party or any of its property is subject.

         5.6. NO MATERIAL LITIGATION. No litigation, investigation or proceeding
of or before any arbitrator or Governmental Authority is pending or, to the
knowledge of any Borrower, threatened by or against any Borrower or any of the
other Loan Parties or against any of its or their respective properties or
revenues (a) with respect to any of the Loan Documents or any of the
transactions contemplated hereby or thereby or (b) which could reasonably be
expected to have a Material Adverse Effect.

         5.7. NO DEFAULT. No Borrower nor any of the other Loan Parties is in
default under or with respect to any of its Contractual Obligations in any
respect which could reasonably be expected to have a Material Adverse Effect. No
Default or Event of Default has occurred and is continuing.

         5.8. OWNERSHIP OF PROPERTY; LIENS. Each of the Borrowers and the other
Loan Parties has good record and marketable title in fee simple to, or a valid
leasehold interest in, all its material real property, and good title to, or a
valid leasehold interest in, all its other material property, and none of such
property is subject to any Lien except as permitted by subsection 8.3. Except as
set forth on Schedule 5.8, the properties to be encumbered by the Mortgages
pursuant to subsection 7.10(a) constitute all of the material real properties
owned in fee by the Borrowers and the other Loan Parties.

         5.9. INTELLECTUAL PROPERTY. Each Borrower and each of the other Loan
Parties owns, or is licensed to use, all trademarks, tradenames, copyrights,
technology, know-how and processes necessary for the conduct of its business as
currently conducted except for those the failure to own or license which could
not reasonably be expected to have a Material Adverse Effect (the "INTELLECTUAL
PROPERTY"). No claim has been asserted and is pending by any Person challenging
or questioning the use of any such Intellectual Property or the validity or
effectiveness of any such Intellectual Property, except for such claims which,
in the aggregate, could not reasonably be expected to have a Material Adverse
Effect, nor does any Borrower know of any valid basis for any such claim. The
use of such Intellectual Property by each Borrower and the other Loan Parties
does not infringe on the rights of any Person, except for such infringements
that, in the aggregate, could not reasonably be expected to have a Material
Adverse Effect.

         5.10. NO BURDENSOME RESTRICTIONS. No Requirement of Law or Contractual
Obligation of any Borrower or any of the other Loan Parties could reasonably be
expected to have a Material Adverse Effect.

<PAGE>

                                                                              44

         5.11. TAXES. Each of the Borrowers and the other Loan Parties has filed
or caused to be filed all United States federal income tax returns and all other
material tax returns which, to the knowledge of the Borrowers, are required to
be filed and has paid all taxes shown to be due and payable on said returns or
on any assessments made against it or any of its property and all other taxes,
fees or other charges imposed on it or any of its property by any Governmental
Authority (other than any taxes, fees or other charges (i) with respect to which
the failure to pay, in the aggregate, could not reasonably be expected to have a
Material Adverse Effect or (ii) the amount or validity of which are currently
being contested in good faith by appropriate proceedings and with respect to
which reserves in conformity with GAAP have been provided on the books of the
relevant Borrower or any of the other Loan Parties, as the case may be); no tax
Lien has been filed, and, to the knowledge of any Borrower, no claim is being
asserted, with respect to any such tax, fee or other charge.

         5.12. FEDERAL RESERVE REGULATIONS. No part of the proceeds of any
Revolving Credit Loans or other extensions of credit hereunder have been or will
be used for any purpose which violates the provisions of the Regulations of the
Board of Governors of the Federal Reserve System, including, without limitation,
Regulation U thereunder. If requested by any Lender or the Administrative Agent,
each Borrower will furnish to the Administrative Agent and each Lender a
statement to the foregoing effect in conformity with the requirements of Form FR
G-3 or Form FR U-1 referred to in said Regulation U.

         5.13. ERISA. Except as disclosed on Schedule 5.13, neither a Reportable
Event nor an "accumulated funding deficiency" (within the meaning of Section 412
of the Code or Section 302 of ERISA) has occurred during the five-year period
prior to the date on which this representation is made or deemed made with
respect to any Plan, and each Plan has complied in all material respects with
the applicable provisions of ERISA and the Code. No termination of an
insufficiently funded Single Employer Plan has occurred, and no Lien in favor of
the PBGC or a Plan has arisen, during such five year period. The present value
of all accrued benefits under all Single Employer Plans taken as a whole does
not exceed the value of the assets of such Single Employer Plans by more than
$75,000,000. Neither any Borrower nor any Commonly Controlled Entity has
incurred or is expected to incur any liability for a complete or partial
withdrawal from any Multiemployer Plan, and neither any Borrower nor any
Commonly Controlled Entity would become subject to any liability under ERISA
which could reasonably be expected to have a Material Adverse Effect if such
Borrower or any such Commonly Controlled Entity were to withdraw completely from
all Multiemployer Plans as of the valuation date most closely preceding the date
on which this representation is made or deemed made. As of the Closing Date, and
to the knowledge of any Borrower on any Borrowing Date thereafter, no such
Multiemployer Plan is in Reorganization or Insolvent.

         5.14. COLLATERAL. The provisions of each of the Security Documents
constitute in favor of the Administrative Agent for the ratable benefit of the
Lenders, a legal, valid and enforceable security interest in all right, title,
and interest of each Borrower or any of the other Loan Parties which is a party
to such Security Document, as the case may be, in the Collateral described in
such Security Document. As of the Closing Date, all Equipment and Inventory (as
each of such terms is defined in the Guarantee and Collateral Agreement) of the
Borrowers and each of its Subsidiaries will be kept at, or will be in transit
to, the locations listed on Schedule 5.14, and, financing statements having been
filed in the offices in the jurisdictions listed in

<PAGE>

                                                                              45

Schedule 3 to the Guarantee and Collateral Agreement, appropriate filings having
been made in the U.S. Patent and Trademark Office and the U.S. Copyright Office,
and such other actions as are described in each of the Security Documents having
been taken in accordance with the Security Documents, the security interest
created by each of the Security Documents constitutes a perfected security
interest in all right, title and interest of each Borrower or such other Loan
Parties, as the case may be, in the Collateral described therein, and except for
Liens existing on the Closing Date which are permitted by subsection 8.3 and
whose priority cannot be superseded by the provisions hereof or of any Security
Document and the filings hereunder or thereunder, a perfected first lien on, and
security interest in, all right, title and interest of such Borrower or such
other Loan Parties, as the case may be, in the Collateral described in each
Security Document.

         5.15. INVESTMENT COMPANY ACT; OTHER REGULATIONS. No Borrower is an
"investment company", or a company "controlled" by an "investment company",
within the meaning of the Investment Company Act of 1940, as amended. No
Borrower is subject to regulation under any Federal or State statute or
regulation (other than Regulation X of the Board of Governors of the Federal
Reserve System) which limits its ability to incur Indebtedness.

         5.16. SUBSIDIARIES AND JOINT VENTURES. Schedule 5.16 hereto sets forth
all of the Subsidiaries of each Borrower, and all of the joint ventures in which
each Borrower or any of its Subsidiaries has an interest, at the Closing Date,
the jurisdiction of their incorporation and the direct or indirect ownership
interest of each Borrower therein.

         5.17. PURPOSE OF REVOLVING CREDIT LOANS. The proceeds of the Revolving
Credit Loans shall be used for the general corporate purposes of the Borrowers
and their Subsidiaries in the ordinary course of business.

         5.18. ENVIRONMENTAL MATTERS. Other than exceptions to any of the
following that would not, individually or in the aggregate, reasonably be
expected to give rise to a Material Adverse Effect:

         (i) The Borrowers and the other Loan Parties: (A) are, and within the
period of all applicable statutes of limitation have been, in compliance with
all applicable Environmental Laws; (B) hold all Environmental Permits (each of
which is in full force and effect) required for any of their current operations
or for any property owned, leased, or otherwise operated by any of them and have
no reason to believe that they will not be able to timely obtain without
material expense all such Environmental Permits required for planned operations;
(C) are, and within the period of all applicable statutes of limitation have
been, in compliance with all of their Environmental Permits; and (D) have no
reason to believe that: any of their Environmental Permits will not be, or will
entail material expense to be, timely renewed or complied with; any additional
Environmental Permits that may be required of any of them will not be, or will
entail material expense to be, timely granted or complied with; or that
compliance with any Environmental Law that is applicable to any of them will not
be, or will entail material expense to be, timely attained and maintained.

         (ii) Materials of Environmental Concern have not been generated,
transported, disposed of, emitted, discharged, or otherwise released or
threatened to be released, to or at any

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                                                                              46

real property presently or formerly owned, leased or operated by any Borrower or
any of the other Loan Parties or, to the best knowledge of any Borrower, at any
other location, which could reasonably be expected to (A) give rise to liability
of any Borrower or any of the other Loan Parties under any applicable
Environmental Law, or (B) interfere with any Borrower's or any other Loan
Party's planned or continued operations, or (C) impair the fair saleable value
of any real property owned or leased by any Borrower or any other Loan Parties.

         (iii) There is no judicial, administrative, or arbitral proceeding
(including any notice of violation or alleged violation) under any Environmental
Law to which any Borrower or any of the other Loan Parties is named as a party
that is pending or, to the knowledge of any Borrower, threatened.

         (iv) No Borrower nor any of the other Loan Parties has received any
written request for information, or been notified that it is a potentially
responsible party, under the federal Comprehensive Environmental Response,
Compensation, and Liability Act or any similar Environmental Law, or received
any other written request for information with respect to any actual or
potential liability for, or violation caused by any, Materials of Environmental
Concern.

         (v) No Borrower nor any of the other Loan Parties has entered into or
agreed to any consent decree, order, or settlement or other agreement, nor is
subject to any judgment, decree, or order or other agreement, in any judicial,
administrative, arbitral, or other forum, relating to compliance with or
liability under any Environmental Law, as to which any obligation has not been
fully and finally resolved.

         (vi) No Borrower nor any of its Subsidiaries has assumed or retained,
by contract or, to the best knowledge of any Borrower, by operation of law, any
liabilities of any kind, fixed or contingent, known or unknown, under any
applicable Environmental Law or with respect to any Material of Environmental
Concern.

         5.19. REGULATION H. Except as otherwise disclosed in writing to the
Administrative Agent, no Mortgage to be delivered pursuant to subsection 7.10(a)
encumbers improved real property which is located in an area that has been
identified by the Secretary of Housing and Urban Development as an area having
special flood hazards and in which flood insurance has been made available under
the National Flood Insurance Act of 1968.

         5.20. NO MATERIAL MISSTATEMENTS. The written information, reports,
financial statements, exhibits and schedules furnished by or on behalf of the
Borrowers and each other Loan Party to the Administrative Agent and the Lenders
in connection with the negotiation of any Loan Document or included therein or
delivered pursuant thereto, taken as a whole, do not contain, and will not
contain as of the Closing Date, any material misstatement of fact and do not,
taken as a whole, omit, and will not, taken as a whole, omit as of the Closing
Date, to state any material fact necessary to make the statements therein, in
the light of the circumstances under which they were made, not materially
misleading. It is understood that no representation or warranty is made
concerning the forecasts, estimates, PRO FORMA information, projections and
statements as to anticipated future performance or conditions, and the
assumptions on which they were based, contained in any such information,
reports, financial statements, exhibits or schedules, except that as of the date
such forecasts, estimates, PRO FORMA information, projections

<PAGE>

                                                                              47

and statements were generated, (a) such forecasts, estimates, PRO FORMA
information, projections and statements were based on the good faith assumptions
of the management of the Borrowers and (b) such assumptions were believed by
such management to be reasonable.

                        SECTION 6. CONDITIONS PRECEDENT

         6.1. CONDITIONS TO EFFECTIVENESS. The effectiveness of this Agreement
is subject to the satisfaction of the following conditions precedent:

          (a) LOAN DOCUMENTS. The Administrative Agent shall have received (i)
     this Agreement, executed and delivered by a duly authorized officer of each
     Borrower, with a counterpart for each Lender, (ii) for the account of each
     of the Lenders which has requested a Note pursuant to subsection 2.2, a
     Revolving Credit Note conforming to the requirements hereof and executed
     and delivered by a duly authorized officer of each Borrower, (iii) the
     Guarantee and Collateral Agreement, executed and delivered by a duly
     authorized officer of each Borrower and each Subsidiary thereof (other than
     each Excluded Foreign Subsidiary and each other Subsidiary which, in
     accordance with subsection 7.10(e), is not required to execute and deliver
     such Agreement), with a counterpart or a conformed copy for each Lender,
     (iv) the Copyright, Patent and Trademark Security Agreement, executed and
     delivered by a duly authorized officer of each Borrower, and the other
     signatories thereto, with a counterpart or a conformed copy for each
     Lender, (v) the CNG Guarantee and Cash Collateral Agreement, executed and
     delivered by a duly authorized officer of CNG, with a counterpart or
     conformed copy for each Lender, (vi) the CNC Guarantee, executed and
     delivered by a duly authorized officer of CNC, with a counterpart or
     conformed copy for each Lender and (vii) a "control" agreement with
     Wachovia Securities, Corporate & Investment Banking, executed and delivered
     by a duly authorized officer of Wachovia in substantially the form of
     Exhibit A to the CNG Guarantee and Cash Collateral Agreement or such other
     form as is reasonably acceptable to the Administrative Agent.

          (b) FEES. The Lenders and the Administrative Agent shall have received
     all fees required to be paid and all expenses for which invoices have been
     presented (including the invoices of Simpson Thacher & Bartlett), on or
     before the Closing Date.

          (c) BORROWING CERTIFICATE. The Administrative Agent shall have
     received, with a counterpart for each Lender, a certificate of the
     Borrowers, dated the Closing Date, substantially in the form of Exhibit C,
     with appropriate insertions and attachments, satisfactory in form and
     substance to the Administrative Agent, executed by the President or any
     Vice President and the Secretary or any Assistant Secretary of the
     Borrowers.

          (d) CORPORATE PROCEEDINGS OF THE LOAN PARTIES. The Administrative
     Agent shall have received, with a counterpart for each Lender, a copy of
     the resolutions, in form and substance satisfactory to the Administrative
     Agent, of the Board of Directors of each of the Loan Parties authorizing
     (i) the execution, delivery and performance of this Agreement and the other
     Loan Documents to which it is a party, (ii) in the case of the Borrowers,
     the borrowings contemplated hereunder and (iii) the granting by it of the
     Liens created pursuant to the Security Documents, certified by the
     Secretary or an

<PAGE>
                                                                              48

     Assistant Secretary of such Loan Party as of the Closing Date, which
     certificate shall be in form and substance satisfactory to the
     Administrative Agent and shall state that the resolutions thereby certified
     have not been amended, modified, revoked or rescinded.

          (e) INCUMBENCY CERTIFICATE OF THE LOAN PARTIES. The Administrative
     Agent shall have received, with a counterpart for each Lender, a
     certificate of each of the Loan Parties, dated the Closing Date, as to the
     incumbency and signature of the officers of such Loan Party executing any
     Loan Document satisfactory in form and substance to the Administrative
     Agent, executed by the President or any Vice President and the Secretary or
     any Assistant Secretary of such Loan Party.

          (f) CORPORATE DOCUMENTS. The Administrative Agent shall have received,
     with a counterpart for each Lender, true and complete copies of the
     certificate of incorporation and by-laws of each of the Loan Parties,
     certified as of the Closing Date as complete and correct copies thereof by
     the Secretary or an Assistant Secretary of such Loan Party.

          (g) CONSENTS, LICENSES AND APPROVALS. The Administrative Agent shall
     have received, with a counterpart for each Lender, a certificate of a
     Responsible Officer (i) attaching copies of all consents, authorizations
     and filings set forth on Schedule 5.4, and (ii) stating that such consents,
     licenses and filings are in full force and effect, and each such consent,
     authorization and filing shall be in form and substance satisfactory to the
     Administrative Agent.

          (h) LEGAL OPINION. The Administrative Agent shall have received, with
     a counterpart for each Lender, the executed legal opinion of Jones, Day,
     Reavis & Pogue, counsel to the Borrowers and the other Loan Parties,
     substantially in the form of Exhibit D, with such changes thereto as may be
     approved by the Administrative Agent. Such legal opinion shall cover such
     other matters incident to the transactions contemplated by this Agreement
     as the Administrative Agent may reasonably require.

          (i) PLEDGED STOCK; STOCK POWERS; PLEDGED NOTES. The Administrative
     Agent shall have received the certificates representing the shares pledged
     pursuant to the Guarantee and Collateral Agreement, together with an
     undated stock power for each such certificate executed in blank by a duly
     authorized officer of the pledgor thereof, and the notes pledged pursuant
     to the Guarantee and Collateral Agreement, each endorsed in blank by a duly
     authorized officer of the pledgor thereof.

          (j) ACTIONS TO PERFECT LIENS. The Administrative Agent shall have
     received evidence in form and substance satisfactory to it that all
     filings, recordings, registrations and other actions, including, without
     limitation, the filing of duly executed financing statements on Form UCC-1,
     necessary or, in the opinion of the Administrative Agent, desirable to
     perfect the Liens created by the Security Documents shall have been
     completed or that all such financing statements and other documents with
     respect to such filings, recordings, registrations and other actions shall
     have been delivered to the Administrative Agent.

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                                                                              49

          (k) SECTION 7.10 COMPLIANCE. The Administrative Agent shall have
     received evidence in form and substance satisfactory to it that the
     Borrowers and their Subsidiaries shall have executed and delivered all such
     documents, and taken all such action as are required so that, after giving
     effect thereto, the Borrowers shall be in full compliance with their
     obligations under subsection 7.10.

          (l) TAX SHARING AGREEMENT. The Administrative Agent shall have
     received a copy of the Tax Sharing Agreement as in effect on the date
     hereof, including all amendments, supplements and other modifications
     thereto, certified to be complete and correct by a Responsible Officer.

         6.2. CONDITIONS TO EACH EXTENSION OF CREDIT. The agreement of each
Lender to make any Revolving Credit Loan or any other extension of credit
requested to be made by it on any date (including, without limitation, its
initial extension of credit), and of the Issuing Lender to issue any Letter of
Credit requested to be issued by it on any date, is subject to the satisfaction
of the following conditions precedent:

          (a) REPRESENTATIONS AND WARRANTIES. Each of the representations and
     warranties made by the Borrowers and any other Loan Party in or pursuant to
     the Loan Documents shall be true and correct in all material respects on
     and as of such date as if made on and as of such date, except for
     representations and warranties stated to relate to a specific earlier date,
     in which case such representations and warranties shall be true and correct
     in all material respects on and as of such earlier date.

          (b) NO DEFAULT. No Default or Event of Default shall have occurred and
     be continuing on such date or after giving effect to the extensions of
     credit requested to be made on such date.

          (c) BORROWING BASE. The Administrative Agent shall have received the
     most recent Borrowing Base Certificate required to be delivered pursuant to
     subsection 7.2(e) and, after giving effect to the Revolving Credit Loans
     and other extension of credit requested to be made on such date and the
     Letters of Credit requested to be issued on such date, no Borrowing Base
     Deficiency would exist.

          (d) ADDITIONAL MATTERS. All corporate and other proceedings, and all
     documents, instruments and other legal matters in connection with the
     transactions contemplated by this Agreement and the other Loan Documents
     shall be satisfactory in form and substance to the Administrative Agent,
     and the Administrative Agent shall have received such other documents and
     legal opinions in respect of any aspect or consequence of the transactions
     contemplated hereby or thereby as it shall reasonably request.

Each borrowing by and Letter of Credit issued on behalf of any Borrower
hereunder shall constitute a representation and warranty by the Borrowers as of
the date thereof that the conditions contained in this subsection have been
satisfied.

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                                                                              50

                        SECTION 7. AFFIRMATIVE COVENANTS

         Each Borrower hereby agrees that, on and after the Closing Date and so
long as the Revolving Credit Commitments remain in effect or any Letter of
Credit remains outstanding and unpaid or any amount is owing to any Lender or
the Administrative Agent hereunder or under any other Loan Document, each
Borrower shall and (except in the case of delivery of financial information,
reports and notices) shall cause each of its Subsidiaries to:

         7.1. FINANCIAL STATEMENTS. Furnish to each Lender:

          (a) as soon as available, but in any event within 90 days after the
     end of each fiscal year of the Borrowers, a copy of the Consolidated
     balance sheet of CNG and its consolidated Subsidiaries as at the end of
     such year and the related Consolidated statement of income and Consolidated
     statements of retained earnings and of cash flows for such year and the
     Compliance Package, reported on, in the case of such Consolidated financial
     statements, without a "going concern" or like qualification or exception,
     or qualification arising out of the scope of the audit, by Arthur Andersen
     LLP or other independent certified public accountants of nationally
     recognized standing selected by CNG; and

          (b) as soon as available, but in any event within 45 days after the
     end of each of the first three quarterly periods of each fiscal year of the
     Borrowers, the unaudited Consolidated balance sheet of CNG and its
     consolidated Subsidiaries as at the end of such quarter, the related
     unaudited Consolidated statement of income for such quarter and the portion
     of the fiscal year through the end of such quarter and the related
     unaudited Consolidated statement of cash flows for the portion of the
     fiscal year through the end of such quarter and the Compliance Package, in
     each case, certified by a Responsible Officer as being fairly stated in all
     material respects (subject to normal year-end audit adjustments); and

          (c) as soon as available, but in any event not later than 30 days (or,
     in the event that such 30th day is not a Business Day, the next succeeding
     Business Day) after the end of each fiscal month of each fiscal year of the
     Borrowers (or, in the event that (i) such month (x) is the first month of a
     fiscal year or (y) is the last month of one of the first three fiscal
     quarters, not later than 45 days after the end of such month or (ii) such
     month is the last month of a fiscal year, not more than 60 days after the
     end of such month), the unaudited Consolidated balance sheet of CNG and its
     consolidated Subsidiaries as at the end of such month, the related
     unaudited Consolidated statement of income for such month and the portion
     of the fiscal year through the end of such month and the related unaudited
     Consolidated statement of cash flows for the portion of the fiscal year
     through the end of such month and the Compliance Package, in each case,
     certified by a Responsible Officer as being fairly stated in all material
     respects (subject to normal year-end audit adjustments);

all such financial statements shall be complete and correct in all material
respects and shall be prepared in reasonable detail and in accordance with GAAP
applied consistently throughout the

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                                                                              51

periods reflected therein and with prior periods (except as approved by such
accountants or Responsible Officer, as the case may be, and disclosed therein).

         7.2. CERTIFICATES; OTHER INFORMATION. Furnish to each Lender:

          (a) concurrently with the delivery of the financial statements
     referred to in subsection 7.1(a), a certificate of the independent
     certified public accountants reporting on such financial statements stating
     that in connection with their audit nothing has come to their attention to
     cause them to believe that any Borrower or any of their Subsidiaries failed
     to comply with the covenants contained in Section 8; PROVIDED, HOWEVER,
     that such audit shall not have been directed primarily toward obtaining
     knowledge of such noncompliance, except as specified in such certificate;

          (b) concurrently with the delivery of the financial statements
     referred to in subsections 7.1(a) and (b), a certificate of a Responsible
     Officer ("COMPLIANCE CERTIFICATE") stating that, to the best of such
     Officer's knowledge, during such period (i) no Subsidiary has been formed
     or acquired (or, if any such Subsidiary has been formed or acquired, the
     relevant Borrower has complied with the requirements of subsection 7.10
     with respect thereto), (ii) neither any Borrower nor any of their
     Subsidiaries has changed its name without complying with the requirements
     of this Agreement and the Security Documents with respect thereto, (iii)
     each Borrower has observed or performed all of its covenants and other
     agreements, and satisfied every condition, contained in this Agreement and
     the other Loan Documents to be observed, performed or satisfied by it, and
     (iv) each Borrower has set forth in reasonable detail any and all
     calculations necessary to show compliance with subsection 2.1(a) and all of
     the financial condition covenants set forth in subsections 8.1 and 8.8,
     including, without limitation, calculations and reconciliations, if any,
     necessary to show compliance with such financial condition covenants on the
     basis of generally accepted accounting principles in the United States of
     America consistent with those utilized in preparing the audited financial
     statements referred to in subsection 5.1, and that such Officer has
     obtained no knowledge of any Default or Event of Default except as
     specified in such certificate;

          (c) not later than 45 days after the end of each fiscal year of the
     Borrowers, a copy of the projections by CNG of the balance sheet, statement
     of income and statement of cash flows on a Consolidated basis of CNG and
     its Subsidiaries for the next succeeding fiscal year, such projections to
     be accompanied by a certificate of a Responsible Officer to the effect that
     such projections have been prepared on the basis of sound financial
     planning practice and that such projections are based upon good faith
     assumptions of management of CNG and such assumptions are believed by
     management of CNG to be reasonable;

          (d) within ten days after the same are sent, copies of all financial
     statements and reports which CNC sends to its stockholders, and within ten
     days after the same are filed, copies of all financial statements and
     reports which CNC may make to, or file with, the Securities and Exchange
     Commission or any successor or analogous Governmental Authority;

<PAGE>

                                                                              52

          (e) within 21 days after the end of each calendar month, a borrowing
     base certificate calculating the Borrowing Base as of the last day in such
     calendar month, substantially in the form of Exhibit G hereto (a "BORROWING
     BASE CERTIFICATE") executed by a Responsible Officer; and

          (f) promptly, such additional financial and other information as any
     Lender may from time to time reasonably request as coordinated through the
     Administrative Agent.

         7.3. PAYMENT OF OBLIGATIONS. Pay, discharge or otherwise satisfy at or
before maturity or before they become delinquent, as the case may be, all its
obligations of whatever nature, including, without limitation, taxes, except
where (a) the amount or validity thereof is currently being contested in good
faith by appropriate proceedings and reserves in conformity with GAAP with
respect thereto have been provided on the books of such Borrower or such
Subsidiary, as the case may be, or (b) the failure to so pay, discharge or
otherwise satisfy such obligations could not, in the aggregate, be reasonably be
expected to have a Material Adverse Effect.

         7.4. CONDUCT OF BUSINESS AND MAINTENANCE OF EXISTENCE. Continue to
engage in business of the same general type as now conducted by it and preserve,
renew and keep in full force and effect its corporate existence and take all
reasonable action to maintain all rights, privileges and franchises necessary or
desirable in the normal conduct of its business except as otherwise permitted
pursuant to subsection 8.5; comply with all Contractual Obligations and
Requirements of Law except to the extent that failure to comply therewith could
not, in the aggregate, be reasonably expected to have a Material Adverse Effect.

         7.5. MAINTENANCE OF PROPERTY; INSURANCE. Keep all property useful and
necessary in its business in good working order and condition, reasonable wear
and tear excepted; maintain with financially sound and reputable insurance
companies insurance on all the Collateral in accordance with the requirements of
Section 5.3 of the Guarantee and Collateral Agreement, Section 5 of each of the
Mortgages and on all its other property in at least such amounts (including as
to amounts of deductibles) and against at least such risks (but including in any
event commercial general liability, product liability and business interruption)
as are usually insured against in the same general area by companies engaged in
the same or a similar business; and furnish to each Lender, upon written request
by the Administrative Agent, full information as to the insurance carried.

         7.6. INSPECTION OF PROPERTY; BOOKS AND RECORDS; DISCUSSIONS. (a) Keep
proper books of records and account in which full, true and correct entries in
conformity with GAAP and all Requirements of Law shall be made of all dealings
and transactions in relation to its business and activities; and permit
representatives of any Lender to visit and inspect any of its properties and
examine and make abstracts from any of its books and records, including without
limitation, in connection with any collateral review or appraisal described in
paragraph (b) below, at any reasonable time and upon reasonable notice and as
often as may reasonably be desired (provided, however, that (i) the Lenders will
arrange and coordinate each such visit through and with the Administrative Agent
and (ii) so long as no Event of Default has occurred and is continuing, no more
than two such visits and inspections shall be made during any fiscal

<PAGE>

                                                                              53

year) and to discuss the business, operations, properties and financial and
other condition of the Borrowers and their Subsidiaries with officers and
employees of the Borrowers and their Subsidiaries and with its independent
certified public accountants (provided that any officers or employees of the
Borrowers shall be permitted to be present at any such discussions between
representatives of any Lender and the Borrowers' independent certified public
accountants).

         (b) At any time upon the request of the Administrative Agent, permit
the Administrative Agent or its professionals (including investment bankers,
consultants, accountants, lawyers and appraisers) retained by the Administrative
Agent to conduct evaluations and appraisals of (i) the Borrowers' practices in
the computation of the Borrowing Base, (ii) the assets included in the Borrowing
Base, (iii) systems and procedures relating to the Borrowing Base items, and
(iv) other related procedures deemed necessary by the Administrative Agent and
pay the reasonable fees and expenses in connection therewith (including, without
limitation, the fees and expenses associated with services performed by the
Administrative Agent's collateral monitoring department); provided, however,
that the Administrative Agent shall not be entitled to conduct such evaluations
and appraisals more frequently than twice per year unless (x) an Event of
Default has occurred and is continuing or (y) the Administrative Agent
reasonably determines in consultation with the Borrowers that any material event
or material change has occurred with respect to the Loan Parties, their
inventory practices or the performance of the Collateral and that as a result of
such event or change more frequent evaluations or appraisals are required to
effectively monitor the Borrowing Base, in which case the Borrowers will permit
the Administrative Agent to conduct such evaluations and appraisals at such
reasonable times and as often as may be reasonably requested, in each case so
long as any Revolving Credit Loans or Letters of Credit shall be outstanding or
shall have been requested by any Borrower hereunder.

         (c) In connection with any evaluation and appraisal relating to the
computation of the Borrowing Base, agree to maintain such additional reserves
(for purposes of computing the Borrowing Base) in respect of Eligible Inventory
and make such other adjustments to its parameters for including Eligible
Inventory in the Borrowing Base as the Administrative Agent shall require based
upon the results of such evaluation and appraisal, provided that the
Administrative Agent shall specify to the Borrowers in writing the reasons for
any such additional reserves or adjustments.

         7.7. NOTICES. Promptly give notice to the Administrative Agent and each
Lender of:

          (a) the occurrence of any Default or Event of Default;

          (b) any (i) default or event of default under any Contractual
     Obligation of any Borrower or any Subsidiary, including, without
     limitation, under the Senior Subordinated Notes, the Senior Subordinated
     1997 Notes or the Senior Subordinated 2002 Notes or (ii) litigation,
     investigation or proceeding which may exist at any time between any
     Borrower or any Subsidiary and any Governmental Authority, which in either
     case, if not cured or if adversely determined, as the case may be, could
     reasonably be expected to have a Material Adverse Effect;

<PAGE>

                                                                              54

          (c) any litigation or proceeding affecting any Borrower or any
     Subsidiary (i) in which the amount involved is $5,000,000 or more and not
     covered by insurance or (ii) in which injunctive or similar relief is
     sought which could reasonably be expected to have a Material Adverse
     Effect;

          (d) the following events, as soon as possible and in any event within
     30 days after any Borrower knows or has reason to know thereof: (i) the
     occurrence or expected occurrence of any Reportable Event with respect to
     any Plan, a failure to make any required contribution to a Plan, the
     creation of any Lien in favor of the PBGC or a Plan or any withdrawal from,
     or the termination, Reorganization or Insolvency of, any Multiemployer Plan
     or (ii) the institution of proceedings or the taking of any other action by
     the PBGC or any Borrower or any Commonly Controlled Entity or any
     Multiemployer Plan with respect to the withdrawal from, or the terminating,
     Reorganization or Insolvency of, any Plan;

          (e) any material adverse change in the business, operations, property,
     condition (financial or otherwise) or prospects of any Borrower and its
     Subsidiaries taken as a whole; and

          (f) any (i) release or discharge by any Borrower or any of its
     Subsidiaries of any Materials of Environmental Concern required to be
     reported under applicable Environmental Laws to any Governmental Authority,
     unless Borrowers reasonably determine that the total Environmental Costs
     arising out of such release or discharge are unlikely to exceed $5,000,000
     or to have a Material Adverse Effect; (ii) condition, circumstance,
     occurrence or event not previously disclosed in writing to the
     Administrative Agent that could result in liability under applicable
     Environmental Laws unless the Borrowers reasonably determine that the total
     Environmental Costs arising out of such condition, circumstance, occurrence
     or event are unlikely to exceed $5,000,000 or to have a Material Adverse
     Effect, or could result in the imposition of any Lien or other restriction
     on the title, ownership or transferability of any facilities and properties
     owned, leased or operated by any Borrower or any of its Subsidiaries that
     could reasonably be expected to have a Material Adverse Effect; and (iii)
     proposed action to be taken by any Borrower or any of its Subsidiaries that
     would reasonably be expected to subject such Borrower or any of its
     Subsidiaries to any material additional or different requirements or
     liabilities under Environmental Laws, unless the Borrowers determine that
     the total Environmental Costs arising out of such proposed action are
     unlikely to exceed $5,000,000 or to have a Material Adverse Effect.

Each notice pursuant to this subsection shall be accompanied by a statement of a
Responsible Officer setting forth details of the occurrence referred to therein
and stating what action the Borrowers propose to take with respect thereto.

         7.8. ENVIRONMENTAL LAWS. (a) (i) Comply substantially with, and
undertake all reasonable efforts to ensure substantial compliance by all
tenants, subtenants, and contractors with, all applicable Environmental Laws;
(ii) obtain, comply substantially with and maintain any and all Environmental
Permits necessary for its operations as conducted and as planned; and (iii)
undertake all reasonable efforts to ensure that all tenants, subtenants, and
contractors obtain,

<PAGE>

                                                                              55

comply substantially with and maintain any and all Environmental Permits
necessary for their operations as conducted and as planned, with respect to any
property leased or subleased from, or operated by any Borrower or its
Subsidiaries. For purposes of this subsection 7.8(a), each Borrower and its
Subsidiaries shall be deemed to comply substantially, or require substantial
compliance, with an Environmental Law or an Environmental Permit, if (i) it
complies with subsection 7.8(c) and (ii) upon learning of any actual or
suspected noncompliance, such Borrower and any such affected Subsidiary shall
promptly undertake all reasonable efforts, if any, to achieve compliance,
PROVIDED that in any case such noncompliance would not reasonably be expected to
have a Material Adverse Effect.

         (b) Promptly comply with all orders and directives of all Governmental
Authorities issued to any Borrower or any of its Subsidiaries regarding
Environmental Laws, other than any such order or directive as to which an appeal
or other appropriate contest is or has been timely and properly taken, is being
diligently pursued in good faith, and the pendency of such appeal or other
appropriate contest would not reasonably be expected to have a Material Adverse
Effect.

         (c) Maintain, update as appropriate, and implement in all material
respects an environmental program reasonably designed to (i) ensure that the
Borrowers, their Subsidiaries, any of their respective operations (including,
without limitation, disposal), and any properties owned, leased or operated by
any of them, attain and remain in substantial compliance with all applicable
Environmental Laws and (ii) reasonably and prudently manage any liabilities or
potential liabilities that the Borrowers, any of the other Loan Parties, any of
their respective operations (including, without limitation, disposal), and any
properties owned or leased by any of them, may have under all applicable
Environmental Laws.

         7.9. FURTHER ASSURANCES. Upon the request of the Administrative Agent,
promptly perform or cause to be performed any and all acts and execute or cause
to be executed any and all documents (including, without limitation, financing
statements and continuation statements) for filing under the provisions of the
Uniform Commercial Code or any other Requirement of Law which are necessary or
advisable to maintain in favor of the Administrative Agent, for the benefit of
the Lenders, Liens on the Collateral that are duly perfected in accordance with
all applicable Requirements of Law.

         7.10. ADDITIONAL COLLATERAL, ETC.. (a) With respect to any property
acquired after the Closing Date by any Borrower or any Subsidiary (other than
(x) any property described in paragraph (b), (c) or (d) below, (y) any property
subject to a Lien expressly permitted by subsection 8.3(f) or 8.3(l) and (z)
property acquired by any Excluded Foreign Subsidiary) as to which the
Administrative Agent, for the benefit of the Lenders, does not have a perfected
Lien, promptly (i) execute and deliver to the Administrative Agent such
amendments to the Guarantee and Collateral Agreement or such other documents as
the Administrative Agent deems necessary or advisable to grant to the
Administrative Agent, for the benefit of the Lenders, a security interest in
such property and (ii) take all actions necessary or advisable to grant to the
Administrative Agent, for the benefit of the Lenders, a perfected first priority
security interest in such property, including the filing of Uniform Commercial
Code financing statements in such jurisdictions as may be required by the
Guarantee and Collateral Agreement or by law or as may be requested by the
Administrative Agent.

<PAGE>

                                                                              56

         (b) With respect to any fee or leasehold interest in any real property
having a value in excess of $600,000 acquired after the Original Closing Date by
any Borrower or any Subsidiary (other than (x) any such real property subject to
a Lien expressly permitted by subsection 8.3(f) or 8.3(l) and (y) real property
acquired by any Excluded Foreign Subsidiary), promptly (i) execute and deliver a
first priority Mortgage, in favor of the Administrative Agent, for the benefit
of the Lenders, covering such real property, (ii) if requested by the
Administrative Agent, provide the Lenders with (x) title and extended coverage
insurance covering such real property in an amount at least equal to the
purchase price of such real property (or such other amount as shall be
reasonably specified by the Administrative Agent) as well as a current ALTA
survey thereof, together with a surveyor's certificate and (y) any consents or
estoppels reasonably deemed necessary or advisable by the Administrative Agent
in connection with such Mortgage, each of the foregoing in form and substance
reasonably satisfactory to the Administrative Agent and (iii) if requested by
the Administrative Agent, deliver to the Administrative Agent legal opinions
relating to the matters described above, which opinions shall be in form and
substance, and from counsel, reasonably satisfactory to the Administrative
Agent.

         (c) With respect to any new Subsidiary (other than an Excluded Foreign
Subsidiary) created or acquired after the Original Closing Date by any Borrower
or any Subsidiary (which, for the purposes of this paragraph (c), shall include
any existing Subsidiary that ceases to be an Excluded Foreign Subsidiary),
promptly (i) execute and deliver to the Administrative Agent such amendments to
the Guarantee and Collateral Agreement as the Administrative Agent deems
necessary or advisable to grant to the Administrative Agent, for the benefit of
the Lenders, a perfected first priority security interest in the Capital Stock
of such new Subsidiary that is owned by any Borrower or any Subsidiary, (ii)
deliver to the Administrative Agent the certificates representing such Capital
Stock, together with undated stock powers, in blank, executed and delivered by a
duly authorized officer of the relevant Borrower or Subsidiary, (iii) cause such
new Subsidiary (A) to become a party to the Guarantee and Collateral Agreement,
(B) to take such actions necessary or advisable to grant to the Administrative
Agent for the benefit of the Lenders a perfected first priority security
interest in the Collateral described in the Guarantee and Collateral Agreement
with respect to such new Subsidiary, including the filing of Uniform Commercial
Code financing statements in such jurisdictions as may be required by the
Guarantee and Collateral Agreement or by law or as may be requested by the
Administrative Agent and (C) to deliver to the Administrative Agent a
certificate of such Subsidiary, in form and substance satisfactory to the
Administrative Agent, with appropriate insertions and attachments, and (iv) if
requested by the Administrative Agent, deliver to the Administrative Agent legal
opinions relating to the matters described above, which opinions shall be in
form and substance, and from counsel, reasonably satisfactory to the
Administrative Agent.

         (d) With respect to any new Excluded Foreign Subsidiary created or
acquired after the Original Closing Date by any Borrower or any Subsidiary
(other than by any Borrower or any Subsidiary that is an Excluded Foreign
Subsidiary), promptly (i) execute and deliver to the Administrative Agent such
amendments to the Guarantee and Collateral Agreement as the Administrative Agent
deems necessary or advisable to grant to the Administrative Agent, for the
benefit of the Lenders, a perfected first priority security interest in the
Capital Stock of such new Subsidiary that is owned by any such Borrower or any
such Subsidiary (provided that in no event

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                                                                              57

shall more than 66% of the total outstanding voting Capital Stock of any such
new Subsidiary be required to be so pledged), (ii) deliver to the Administrative
Agent the certificates representing such Capital Stock, together with undated
stock powers, in blank, executed and delivered by a duly authorized officer of
the relevant Borrower or Subsidiary, and take such other action as may be
necessary or, in the opinion of the Administrative Agent, desirable to perfect
the Administrative Agent's security interest therein, and (iii) if requested by
the Administrative Agent, deliver to the Administrative Agent legal opinions
relating to the matters described above, which opinions shall be in form and
substance, and from counsel, reasonably satisfactory to the Administrative
Agent.

         (e) Anything in this subsection 7.10 to the contrary notwithstanding,
(i) Pearle shall not be required to create a Lien on any shares of Capital Stock
of Pearl Visioncare, Inc. owned by it or on any rights owned by it under the
Pearle Visioncare Line of Credit Agreement and (ii) no Subsidiary shall be
required to become a Guarantor, create Liens on its assets or permit a Lien to
be created on shares of its Capital Stock or any promissory note issued by it
(x) if and to the extent that to do so would violate any law, rule or regulation
of any Governmental Authority applicable to such Subsidiary and if there shall
have been delivered to the Administrative Agent evidence, reasonably
satisfactory to the Administrative Agent, that such a violation would result
from such guarantee or creation of Lien or (y) if the aggregate net book value
of the assets of such Subsidiary, when added to the aggregate net book value of
all other Subsidiaries with respect to which, pursuant to this clause (y), there
is then non-compliance with the provision of subsections 7.10(a), (b) and/or
(c), does not exceed $200,000. Nothing in this subsection 7.10 shall be deemed
to require that any Borrower or any Subsidiary thereof obtain, or seek to
obtain, the consent or approval by any Governmental Authority of any guarantee
or creation of Lien that would not be required pursuant to this subsection 7.10
unless such consent or approval shall have been obtained, PROVIDED that the
appropriate Borrower or Subsidiary shall be required to use commercially
reasonable efforts to obtain such consent or approval if the Administrative
Agent, at any time when an Event of Default shall have occurred and be
continuing, requests that it do so.

                         SECTION 8. NEGATIVE COVENANTS

         Each Borrower hereby agrees that on and after the Closing Date and, so
long as the Revolving Credit Commitments remain in effect or any Letter of
Credit remains outstanding and unpaid or any amount is owing to any Lender or
the Administrative Agent hereunder or under any other Loan Document, each
Borrower shall not, and (except with respect to subsection 8.1) shall not permit
any of its Subsidiaries to, directly or indirectly, and (with respect to
subsection 8.1 only) shall not permit CNG to:

         8.1. FINANCIAL CONDITION COVENANTS.

         (a) LEVERAGE RATIO. Permit the Leverage Ratio as of the end of any
fiscal quarter of CNG set forth below to be greater than the ratio set forth
opposite such fiscal quarter below:

         FISCAL QUARTER                MAXIMUM LEVERAGE RATIO

         2nd Qtr 2002                        3.80 to 1.00

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                                                                              58

         3rd Qtr 2002                        3.80 to 1.00
         4th Qtr 2002                        3.80 to 1.00
         1st Qtr 2003                        3.80 to 1.00
         2nd Qtr 2003                        3.80 to 1.00
         3rd Qtr 2003                        3.80 to 1.00
         4th Qtr 2003                        3.35 to 1.00
         1st Qtr 2004                        3.35 to 1.00
         2nd Qtr 2004                        3.35 to 1.00
         3rd Qtr 2004                        3.35 to 1.00
         4th Qtr 2004                        2.70 to 1.00
         1st Qtr 2005                        2.70 to 1.00
         2nd Qtr 2005                        2.70 to 1.00
         3rd Qtr 2005                        2.70 to 1.00
         4th Qtr 2005                        2.40 to 1.00
         1st Qtr 2006                        2.40 to 1.00
         2nd Qtr 2006                        2.40 to 1.00

         (b) ADJUSTED INTEREST COVERAGE RATIO. Permit the Adjusted Interest
Coverage Ratio as of the end of any fiscal quarter of CNG set forth below to be
less than the ratio set forth opposite such fiscal quarter below:

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                                                                              59

         FISCAL QUARTER                MAXIMUM ADJUSTED INTEREST
                                            COVERAGE RATIO

         2nd Qtr 2002                        1.30 to 1.00
         3rd Qtr 2002                        1.30 to 1.00
         4th Qtr 2002                        1.30 to 1.00
         1st Qtr 2003                        1.30 to 1.00
         2nd Qtr 2003                        1.30 to 1.00
         3rd Qtr 2003                        1.30 to 1.00
         4th Qtr 2003                        1.50 to 1.00
         1st Qtr 2004                        1.50 to 1.00
         2nd Qtr 2004                        1.50 to 1.00
         3rd Qtr 2004                        1.50 to 1.00
         4th Qtr 2004                        1.65 to 1.00
         1st Qtr 2005                        1.65 to 1.00
         2nd Qtr 2005                        1.65 to 1.00
         3rd Qtr 2005                        1.65 to 1.00
         4th Qtr 2005                        1.75 to 1.00
         1st Qtr 2006                        1.75 to 1.00
         2nd Qtr 2006                        1.75 to 1.00

         8.2. LIMITATION ON INDEBTEDNESS. Create, incur, assume or suffer to
exist any Indebtedness, except:

          (a) Indebtedness of the Borrowers under this Agreement and any
     Revolving Credit Notes;

          (b) Indebtedness of any Borrower to any Subsidiary and of any
     Subsidiary Guarantor to any Borrower or any other Subsidiary;

          (c) Indebtedness of the Borrowers and their Subsidiaries under
     Permitted Hedging Arrangements;

          (d) Indebtedness outstanding on the Closing Date and listed on
     Schedule 8.2(d) and any refinancings, refundings, renewals or extensions
     thereof; PROVIDED that the amount of such Indebtedness is not increased at
     the time of such refinancing, refunding, renewal or extension;

          (e) Indebtedness of a Person which becomes a Subsidiary of a Borrower
     after the Closing Date; PROVIDED that (i) such Indebtedness existed at the
     time such Person became a Subsidiary and was not created in anticipation
     thereof and (ii) immediately after giving effect to the acquisition of such
     Person by a Borrower no Default or Event of Default shall have occurred and
     be continuing, and any refinancings, refundings, renewals or extensions
     thereof; PROVIDED that the amount of such Indebtedness is not increased at
     the time of such refinancing, refunding, renewal or extension;

<PAGE>

                                                                              60

          (f) Indebtedness of up to an aggregate outstanding face amount of
     $10,000,000 of documentary letters of credit issued by Wachovia for the
     account of any Borrower or any Subsidiary;

          (g) Indebtedness consisting of Guarantee Obligations permitted by
     subsection 8.4;

          (h) Indebtedness of the Borrowers and their Subsidiaries incurred to
     finance the acquisition of fixed or capital assets (whether pursuant to a
     loan, a Financing Lease or otherwise) in an aggregate principal amount not
     exceeding as to the Borrowers and their Subsidiaries $15,000,000 at any
     time outstanding;

          (i) Indebtedness resulting from loans and advances permitted under
     subsection 8.9; and

          (j) in addition to Indebtedness permitted by clauses (a)-(h) above,
     Indebtedness of the Borrowers and their Subsidiaries in an aggregate
     principal amount not exceeding as to the Borrowers and their Subsidiaries
     $10,000,000 at any time outstanding.

         8.3. LIMITATION ON LIENS. Create, incur, assume or suffer to exist any
Lien upon any of its property, assets or revenues, whether now owned or
hereafter acquired, except for:

          (a) Liens for taxes not yet due or which are being contested in good
     faith by appropriate proceedings; PROVIDED that adequate reserves with
     respect thereto are maintained on the books of a Borrower or a Subsidiary,
     as the case may be, in conformity with GAAP;

          (b) carrier's, warehousemen's, mechanic's, landlord's, materialmen's,
     repairmen's or other like Liens arising in the ordinary course of business
     which are not overdue for a period of more than 60 days or which are being
     contested in good faith by appropriate proceedings;

          (c) pledges or deposits in connection with workers' compensation,
     unemployment insurance and other social security legislation and deposits
     securing liability to insurance carriers under insurance or self-insurance
     arrangements;

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

          (e) easements, rights-of-way, restrictions and other similar
     encumbrances incurred in the ordinary course of business which do not
     materially detract from the value of the property subject thereto or
     materially interfere with the ordinary conduct of the business of such
     Borrower or such Subsidiary conducted at the property subject thereto;

<PAGE>

                                                                              61

          (f) Liens on the property or assets of a Person which becomes a
     Subsidiary of a Borrower after the Closing Date securing Indebtedness
     permitted by subsection 8.2(e); PROVIDED that (i) such Liens existed at the
     time such Person became a Subsidiary and were not created in anticipation
     thereof, (ii) any such Lien is not spread to cover any property or assets
     of such Person after the time such corporation becomes a Subsidiary (other
     than additions thereto and property in replacement or substitution
     thereof), and (iii) the amount of Indebtedness secured thereby is not
     increased;

          (g) Liens created pursuant to the Security Documents;

          (h) Liens in existence on the Closing Date listed on Schedule 8.3(h),
     securing Indebtedness permitted by subsection 8.2(d); PROVIDED that no such
     Lien is spread to cover any additional property after the Closing Date and
     that the amount of Indebtedness secured thereby is not increased;

          (i) Liens arising by reason of any judgment, decree or order of any
     court or other Governmental Authority, if appropriate legal proceedings are
     being diligently prosecuted and shall not have been finally terminated or
     the period within which such proceedings may be initiated shall not have
     expired, in an aggregate amount not to exceed $5,000,000 at any time
     outstanding;

          (j) leases and subleases of real property owned or leased by any
     Borrower or any Subsidiary not interfering with the ordinary conduct of the
     business of such Borrowers and their Subsidiaries;

          (k) renewals, extensions and replacements of the Liens permitted under
     clauses (f), (h) and (j) above; PROVIDED that no such Lien shall as a
     result thereof cover any additional assets (other than additions thereto
     and property in replacement or substitution thereof) and the principal
     amount of Indebtedness secured thereby is not increased;

          (l) Liens securing Indebtedness of the Borrowers and their
     Subsidiaries permitted by subsection 8.2(h) incurred to finance the
     acquisition of fixed or capital assets; PROVIDED that (i) such Liens shall
     be created substantially simultaneously with or within 90 days of the
     acquisition of such fixed or capital assets, (ii) such Liens do not at any
     time encumber any property other than the property financed by such
     Indebtedness (other than additions thereto and property in replacement or
     substitution thereof) and (iii) the principal amount of Indebtedness
     secured thereby is not increased; and

          (m) Liens on Inventory which is the subject of a trade letter of
     credit issued for the account of a Borrower by Wachovia, to the extent
     permitted pursuant to subsection 8.2(f), on the various documents related
     thereto and on the proceeds thereof, PROVIDED that (i) any such Lien is not
     spread to cover any other property or assets of any Borrower, (ii) the
     amount of Indebtedness secured thereby is not increased and (iii) the Lien
     on the subject property shall terminate according to its terms upon payment
     in full of the reimbursement obligations with respect to the relevant trade
     letter of credit.

<PAGE>

                                                                              62

         8.4. LIMITATION ON GUARANTEE OBLIGATIONS. Create, incur, assume or
suffer to exist any Guarantee Obligation except:

          (a) Guarantee Obligations in existence on the Closing Date and listed
     on Schedule 8.4(a), and any refinancing, refundings, renewals or extensions
     thereof PROVIDED that the amount of such Guarantee Obligation shall not be
     increased at the time of such refinancing, refunding, extension or renewal;

          (b) guarantees made in the ordinary course of its business by any
     Borrower or any of its Subsidiaries of obligations of any Subsidiary
     Guarantor or by any Subsidiary which is not a Subsidiary Guarantor of
     obligations of any Borrower or any other Subsidiary, which obligations are
     otherwise permitted under this Agreement;

          (c) the Guarantee and Collateral Agreement and any of the other
     Guarantees;

          (d) Guarantee Obligations of a Person which becomes a Subsidiary after
     the Closing Date; PROVIDED that (i) such Guarantee Obligations existed at
     the time such Person became a Subsidiary and were not created in
     anticipation thereof and (ii) immediately after giving effect to the
     acquisition of such Person by a Borrower no Default or Event of Default
     shall have occurred and be continuing, and any refinancings, refundings,
     renewals or extensions thereof; PROVIDED that the amount of such Guarantee
     Obligations is not increased at the time of such refinancing, refunding,
     renewal or extension; and

          (e) Guarantee Obligations of Pearle of Indebtedness of franchisees of
     Pearle, PROVIDED that the aggregate amount of such Guarantee Obligations
     outstanding at any time shall not exceed $10,000,000; and

          (f) Guarantee Obligations permitted by subsection 8.9.

         8.5. LIMITATION ON FUNDAMENTAL CHANGES. Enter into any merger,
consolidation or amalgamation, or liquidate, wind up or dissolve itself (or
suffer any liquidation or dissolution), or convey, sell, lease, assign, transfer
or otherwise dispose of, all or substantially all of its property, business or
assets, or make any material change in its present method of conducting
business, except:

          (a) any Subsidiary of any Borrower may be merged or consolidated with
     or into any Borrower (PROVIDED that such Borrower shall be the continuing
     or surviving corporation) or with or into any one or more Wholly Owned
     Subsidiaries of any Borrower (PROVIDED that (i) the Wholly Owned Subsidiary
     or Subsidiaries shall be the continuing or surviving corporation and (ii)
     if such Subsidiary is a Subsidiary Guarantor, the continuing or surviving
     corporation shall be a Subsidiary Guarantor);

          (b) any Wholly Owned Subsidiary may sell, lease, transfer or otherwise
     dispose of any or all of its assets (upon voluntary liquidation or
     otherwise) to any Borrower or any other Wholly Owned Subsidiary of any
     Borrower, PROVIDED that, if such transferor Wholly Owned Subsidiary is a
     Subsidiary Guarantor, the transferee Wholly Owned Subsidiary shall be a
     Subsidiary Guarantor; and

<PAGE>

                                                                              63

          (c) sales and other dispositions of assets permitted by subsection
     8.6(b).

         8.6. LIMITATION ON SALE OF ASSETS. Convey, sell, lease, assign,
transfer or otherwise dispose of any of its property, business or assets
(including, without limitation, receivables and leasehold interests), whether
now owned or hereafter acquired, or, in the case of any Subsidiary, issue or
sell any shares of such Subsidiary's Capital Stock to any Person other than a
Borrower or any Wholly Owned Subsidiary, except:

          (a) the sale or other disposition of any property in the ordinary
     course of business;

          (b) the sale or other disposition of any assets at fair market value,
     PROVIDED that the aggregate fair market value of all assets sold pursuant
     to this paragraph (b) in any fiscal year of the Borrowers shall not exceed
     $25,000,000;

          (c) the sale or discount without recourse of accounts receivable
     arising in the ordinary course of business, but only in connection with the
     compromise or collection thereof;

          (d) as permitted by subsection 8.5(b); and

          (e) dispositions resulting from any casualty or condemnation of any
     property.

         8.7. LIMITATION ON DIVIDENDS. Declare or pay any dividend on, or make
any payment on account of, or set apart assets for a sinking or other analogous
fund for, the purchase, redemption, defeasance, retirement or other acquisition
of, any shares of any class of Capital Stock of any Borrower or any warrants or
options to purchase any such Capital Stock, whether now or hereafter
outstanding, or make any other distribution in respect thereof, either directly
or indirectly, whether in cash or property or in obligations of such Borrower or
any Subsidiary, except for:

          (a) dividends, payments or distributions solely in common stock of a
     Borrower;

          (b) dividends to CNG in an amount sufficient to allow CNG to pay
     interest on the Senior Subordinated Notes, the Senior Subordinated 1997
     Notes and the Senior Subordinated 2002 Notes in accordance with the terms
     of each thereof, PROVIDED that CNG actually uses such dividends to make
     such payments of interest;

          (c) so long as no Default or Event of Default shall have occurred and
     be continuing or would occur after giving effect to such dividend,
     dividends to CNG in an aggregate amount (declared or paid subsequent to the
     Closing Date) not to exceed $50,000,000 solely to allow CNG to repurchase
     Senior Subordinated Notes, Senior Subordinated 1997 Notes and/or Senior
     Subordinated 2002 Notes without violating Section 9(m);

          (d) so long as no Default or Event of Default shall have occurred and
     be continuing or would occur after giving effect to such dividend,
     dividends to CNG in an

<PAGE>

                                                                              64

     aggregate amount (declared or paid subsequent to the Closing Date) not to
     exceed $4,000,000 solely to allow CNG or CNC to repurchase, redeem, or
     otherwise acquire or retire for value, any Capital Stock of CNG or CNC or
     any current or former Subsidiary of CNG held by any of CNG's (or any of its
     Subsidiaries') current or former employees;

          (e) payments or distributions in respect of taxes, as provided in the
     Tax Sharing Agreement, to the extent actually used to pay taxes to a taxing
     authority; and

          (f) dividends to CNG in an aggregate amount not to exceed an amount
     equal to .25% of the aggregate net sales of the Borrowers and their
     Subsidiaries for any fiscal year solely for the purpose of enabling CNC to
     pay the ordinary operating and administrative expenses of CNC (including
     all reasonable professional fees and expenses) in connection with complying
     with its reporting obligations and obligations to prepare and distribute
     business records in the ordinary course of business and CNC's costs and
     expenses relating to taxes (which taxes are attributable to the operations
     of CNG and its Subsidiaries or to CNC's ownership thereof) for such fiscal
     year; and

          (g) so long as no Default or Event of Default shall have occurred and
     be continuing or would occur after giving effect to such dividend,
     dividends to CNG other than dividends otherwise permitted under any of the
     foregoing clauses (a) through (f) in an aggregate amount not to exceed
     $10,000,000 in any fiscal year.

         8.8. LIMITATION ON CAPITAL EXPENDITURES. Make any expenditure in
respect of the purchase or other acquisition of fixed or capital assets and/or
in respect of the development of computer systems owned or operated by the
Borrowers and their Subsidiaries, except for expenditures in the ordinary course
of business not exceeding, in the aggregate for the Borrowers and their
Subsidiaries subsequent to the Closing Date, $60,000,000.

         8.9. LIMITATION ON INVESTMENTS, LOANS AND ADVANCES. Make any advance,
loan, extension of credit (by way of guaranty or otherwise) or capital
contribution to, or purchase any stock, bonds, notes, debentures or other
securities of or any assets constituting a business unit of, or make any other
investment, in cash or by transfer of assets or property, in, any Person (each,
an "INVESTMENT"), except:

          (a) extensions of trade credit in the ordinary course of business;

          (b) Investments in Cash Equivalents;

          (c) loans and advances to employees of the Borrowers or their
     Subsidiaries for travel, entertainment and relocation expenses in the
     ordinary course of business;

          (d) Investments by a Borrower in any Subsidiary thereof which is a
     Subsidiary Guarantor and Investments by any Subsidiary of a Borrower in
     such Borrower and in other Subsidiaries of such Borrower (PROVIDED that, if
     the Subsidiary making such Investment is a Subsidiary Guarantor, the
     Subsidiary in which such Investment is made shall also be a Subsidiary
     Guarantor);

<PAGE>

                                                                              65

          (e) so long as no Default or Event of Default has occurred and is
     continuing or would occur after giving effect to such Investment,
     Investments in franchises in a business related to the optical business of
     Pearle and Cole Vision as conducted on the Closing Date in an aggregate
     amount not to exceed $15,000,000 during any fiscal year;

          (f) Investments in HMO Subsidiaries, PROVIDED that the aggregate
     amount of the Investments permitted by this paragraph (f) outstanding at
     any one time shall not exceed $10,000,000;

          (g) Investments in Excluded Foreign Subsidiaries in an aggregate
     amount not to exceed $10,000,000; and

          (h) in addition to the foregoing, Investments subsequent to the
     Closing Date, other than the purchase of the Senior Subordinated 1997
     Notes, the Senior Subordinated 2002 Notes or the Senior Subordinated Notes,
     in an aggregate amount not to exceed $10,000,000.

         8.10. LIMITATION ON TRANSACTIONS WITH AFFILIATES. Enter into any
transaction, including, without limitation, any purchase, sale, lease or
exchange of property or the rendering of any service, with any Affiliate unless
such transaction is (a) otherwise permitted under this Agreement, (b) in the
ordinary course of such Borrower's or such Subsidiary's business and (c) upon
fair and reasonable terms no less favorable to such Borrower or such Subsidiary,
as the case may be, than it would obtain in a comparable arm's length
transaction with a Person which is not an Affiliate, provided that the
requirements of this clause (c) shall not be applicable (x) in the case of
services provided or products sold by such Borrower or such Subsidiary to an HMO
Subsidiary or a Foreign Subsidiary so long as such Borrower or such Subsidiary
is reimbursed for the costs incurred by it in providing such service or, as the
case may be, producing or obtaining such products or (y) to the Pearle
Visioncare Line of Credit Agreement.

         8.11. LIMITATION ON CHANGES IN FISCAL YEAR. Permit the fiscal year of
the Borrowers to end on a day other than the Saturday closest to January 31 in
any year.

         8.12. LIMITATION ON NEGATIVE PLEDGE CLAUSES. Enter into with any Person
any agreement, which prohibits or limits the ability of any Borrower or any of
its Subsidiaries to create, incur, assume or suffer to exist any Lien upon any
of its property, assets or revenues, whether now owned or hereafter acquired,
other than (a) this Agreement, (b) agreements in effect on the Original Closing
Date listed on Schedule 8.12, including, without limitation, the Senior
Subordinated Notes Indenture, or any refinancing, refunding, renewal or
extension thereof which is permitted hereunder, (c) customary non-assignment
provisions under contracts to the extent such provisions prohibit or limit the
ability to grant a Lien on the rights under such contracts, (d) restrictions on
granting Liens on assets under agreements to sell or otherwise dispose of such
assets, (e) the Senior Subordinated 1997 Notes Indenture, or any refinancing,
refunding, renewal or extension thereof which is permitted hereunder, (f) the
Senior Subordinated 2002 Notes Indenture, or any refinancing, refunding, renewal
or extension thereof which is permitted hereunder, (g) agreements governing
Indebtedness permitted by subsection 8.2(e) and (h) agreements governing any
purchase money Liens or Financing Leases otherwise permitted

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                                                                              66

hereby (in which case, any prohibition or limitation shall only be effective
against the assets financed thereby).

         8.13. LIMITATION ON LINES OF BUSINESS. Enter into any business, either
directly or through any Subsidiary or any joint venture, except for those
businesses in which the Borrowers and their Subsidiaries are engaged on the
Closing Date or which are related thereto.

         8.14. LIMITATIONS ON CURRENCY AND COMMODITY HEDGING TRANSACTIONS. Enter
into, purchase or otherwise acquire agreements or arrangements relating to
currency, commodity or other hedging except, to the extent and only to the
extent that, such agreements or arrangements are entered into, purchased or
otherwise acquired in the ordinary course of business of any Borrower or any
Subsidiary with reputable financial institutions and not for purposes of
investment or speculation (any such agreement or arrangement permitted by this
subsection, a "PERMITTED HEDGING ARRANGEMENT").

         8.15. LIMITATION ON SALE LEASEBACKS. Enter into any arrangement with
any Person providing for the leasing by any Borrower or any Subsidiary of real
or personal property which has been or is to be sold or transferred by such
Borrower or such Subsidiary to such Person or to any other Person to whom funds
have been or are to be advanced by such Person on the security of such property
or rental obligations of such Borrower or such Subsidiary (such arrangement, a
"SALE-LEASEBACK") except for Sale-Leasebacks in the ordinary course of such
Borrower's or such Subsidiary's business, consistent with past practice and at
market rates. For the avoidance of doubt, Sale-Leasebacks that result in a
Financing Lease shall be treated as Indebtedness for all purposes of this
Agreement.

         8.16. CHANGES TO CASH MANAGEMENT COLLECTION SYSTEM. Without the prior
written consent of the Administrative Agent, make any changes to the cash
management collection system established in accordance with subsection 6.1(j) of
the Existing Credit Agreement that would adversely affect the interests of the
Administrative Agent and the Lenders, including, without limitation, any change
which would result in the "Cash Collateral Account" (as defined in the CNG
Guarantee and Cash Collateral Agreement) ceasing to be the principal cash
concentration account for the Borrowers.

                          SECTION 9. EVENTS OF DEFAULT

         If any of the following events shall occur and be continuing:

          (a) Any Borrower shall fail to pay any principal of any Revolving
     Credit Loan or any Reimbursement Obligation when due in accordance with the
     terms thereof or hereof; or any Borrower shall fail to pay any interest on
     any Revolving Credit Loan, or any other amount payable hereunder, within
     five days after any such interest or other amount becomes due in accordance
     with the terms thereof or hereof; or

          (b) Any representation or warranty made or deemed made by any Borrower
     or any other Loan Party herein or in any other Loan Document or which is
     contained in any certificate, document or financial or other written
     statement furnished by it at any time under or in connection with this
     Agreement or any such other Loan Document shall prove

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                                                                              67

     to have been incorrect in any material respect on or as of the date made or
     deemed made; or

          (c) Any Borrower or any other Loan Party shall default in the
     observance or performance of any agreement contained in subsection 7.7(a)
     or Section 8; or

          (d) Any Borrower or any other Loan Party shall default in the
     observance or performance of any other agreement contained in this
     Agreement or any other Loan Document (other than as provided in paragraphs
     (a) through (c) of this Section 9), and such default shall continue
     unremedied for a period of 30 days; or

          (e) CNG, any Borrower or any Subsidiary shall (i) default in any
     payment of principal of or interest on any Indebtedness (other than the
     Revolving Credit Loans and the Reimbursement Obligations) in excess of
     $5,000,000 or in the payment of any Guarantee Obligation in excess of
     $5,000,000, beyond the period of grace, if any, provided in the instrument
     or agreement under which such Indebtedness or Guarantee Obligation was
     created; or (ii) default in the observance or performance of any other
     agreement or condition relating to any such Indebtedness or Guarantee
     Obligation or contained in any instrument or agreement evidencing, securing
     or relating thereto, or any other event shall occur or condition exist, the
     effect of which default or other event or condition is to cause, or to
     permit the holder or holders of such Indebtedness or beneficiary or
     beneficiaries of such Guarantee Obligation (or a trustee or agent on behalf
     of such holder or holders or beneficiary or beneficiaries) to cause, with
     the giving of notice if required, such Indebtedness to become due prior to
     its stated maturity or such Guarantee Obligation to become payable; or

          (f) (i) CNG, any Borrower or any Subsidiary shall commence any case,
     proceeding or other action (A) under any existing or future law of any
     jurisdiction, domestic or foreign, relating to bankruptcy, insolvency,
     reorganization or relief of debtors, seeking to have an order for relief
     entered with respect to it, or seeking to adjudicate it a bankrupt or
     insolvent, or seeking reorganization, arrangement, adjustment, winding-up,
     liquidation, dissolution, composition or other relief with respect to it or
     its debts, or (B) seeking appointment of a receiver, trustee, custodian,
     conservator or other similar official for it or for all or any substantial
     part of its assets, or CNG, any Borrower or any Subsidiary shall make a
     general assignment for the benefit of its creditors; or (ii) there shall be
     commenced against CNG, any Borrower or any Subsidiary any case, proceeding
     or other action of a nature referred to in clause (i) above which (A)
     results in the entry of an order for relief or any such adjudication or
     appointment or (B) remains undismissed, undischarged or unbonded for a
     period of 60 days; or (iii) there shall be commenced against CNG, any
     Borrower or any Subsidiary any case, proceeding or other action seeking
     issuance of a warrant of attachment, execution, distraint or similar
     process against all or any substantial part of its assets which results in
     the entry of an order for any such relief which shall not have been
     vacated, discharged, or stayed or bonded pending appeal within 60 days from
     the entry thereof; or (iv) CNG, any Borrower or any Subsidiary shall take
     any action in furtherance of, or indicating its consent to, approval of, or
     acquiescence in, any of the acts set forth in clause (i), (ii), or (iii)
     above; or (v)

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                                                                              68

     CNG, any Borrower or any Subsidiary shall generally not, or shall be unable
     to, or shall admit in writing its inability to, pay its debts as they
     become due; or

          (g) (i) Any Person shall engage in any "prohibited transaction" (as
     defined in Section 406 of ERISA or Section 4975 of the Code) involving any
     Plan, (ii) any "accumulated funding deficiency" (as defined in Section 302
     of ERISA), whether or not waived, shall exist with respect to any Plan or
     any Lien in favor of the PBGC or a Plan shall arise on the assets of any
     Borrower or any Commonly Controlled Entity, (iii) a Reportable Event shall
     occur with respect to, or proceedings shall commence to have a trustee
     appointed, or a trustee shall be appointed, to administer or to terminate,
     any Single Employer Plan, which Reportable Event or commencement of
     proceedings or appointment of a trustee is, in the reasonable opinion of
     the Majority Lenders, likely to result in the termination of such Plan for
     purposes of Title IV of ERISA, (iv) any Single Employer Plan shall
     terminate for purposes of Title IV of ERISA, (v) any Borrower or any
     Commonly Controlled Entity shall, or in the reasonable opinion of the
     Majority Lenders is likely to, incur any liability in connection with a
     withdrawal from, or the Insolvency or Reorganization of, a Multiemployer
     Plan or (vi) any other event or condition shall occur or exist with respect
     to a Plan; and in each case in clauses (i) through (vi) above, such event
     or condition, together with all other such events or conditions, if any,
     could reasonably be expected to have a Material Adverse Effect; or

          (h) One or more judgments or decrees shall be entered against CNG, any
     Borrower or any Subsidiary involving in the aggregate a liability (not paid
     or fully covered by insurance) of $5,000,000 or more, and all such
     judgments or decrees shall not have been vacated, discharged, stayed or
     bonded pending appeal within 60 days from the entry thereof; or

          (i) Except as, and to the extent, permitted by this Agreement, (i) any
     of the Security Documents or any of the other Loan Documents shall cease,
     for any reason, to be in full force and effect, or any Borrower or any
     other Loan Party which is a party to any of the Security Documents or any
     of the other Loan Documents shall so assert or (ii) the Lien created by any
     of the Security Documents shall cease to be enforceable and of the same
     effect and priority purported to be created thereby; or

          (j) The occurrence of any Change of Control; or

          (k) The Senior Subordinated Notes, the Senior Subordinated 1997 Notes
     or the Senior Subordinated 2002 Notes, for any reason, shall not be or
     shall cease to be validly subordinated, as provided therein and in the
     Senior Subordinated Notes Indenture, the Senior Subordinated 1997 Notes
     Indenture or the Senior Subordinated 2002 Notes Indenture, to the
     obligations of the Borrowers under this Agreement, any Revolving Credit
     Notes and the other Loan Documents; or

          (l) CNG shall engage in any business other than the owning of the
     capital stock of the Borrowers and all actions incidental thereto or in
     connection therewith, including, without limitation, entering into the CNG
     Guarantee and Cash Collateral Agreement and the maintenance of cash
     management arrangements for the Borrowers

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                                                                              69

     and their Subsidiaries or CNG shall incur any material liabilities (other
     than the Senior Subordinated Notes, the Senior Subordinated 1997 Notes or
     the Senior Subordinated 2002 Notes); or

          (m) CNG shall (i) make any optional payment or prepayment on or
     repurchase or redemption or purchase of the Senior Subordinated Notes, the
     Senior Subordinated 1997 Notes or the Senior Subordinated 2002 Notes
     (including, without limitation, any payment on account of, or for a sinking
     or other analogous fund for the repurchase, redemption, defeasance or other
     acquisition thereof) other than (x) (so long as no Default or Event of
     Default has occurred and is continuing or would occur as a result of such
     repurchase), repurchases (subsequent to the Closing Date) by CNG of such of
     the Senior Subordinated Notes, the Senior Subordinated 1997 Notes and/or
     Senior Subordinated 2002 Notes that it is able to repurchase for an
     aggregate purchase price (including fees and expenses incurred in
     connection with such repurchase) not to exceed $50,000,000 and (y) the
     repurchase, redemption, defeasance or other acquisition of the Senior
     Subordinated Notes as soon as practicable following the issuance of the
     Senior Subordinated 2002 Notes with the net proceeds thereof, (ii) amend,
     modify or change, or consent or agree to any material amendment,
     modification or change to any of the terms of the Senior Subordinated
     Notes, the Senior Subordinated 1997 Notes or the Senior Subordinated 2002
     Notes (other than any such amendment, modification or change which would
     extend the maturity or reduce the amount of any payment of principal
     thereof or which would reduce the rate or extend the date for payment of
     interest thereon or which would shorten the notice period required for
     optional redemption of the Senior Subordinated Notes), or (iii) amend,
     modify or change or consent or agree to any amendment, modification or
     change to the subordination provisions or to any of the other provisions of
     the Senior Subordinated 1997 Notes Indenture or the Senior Subordinated
     2002 Notes Indenture (other than any such amendment, modification or change
     which would shorten the notice period required for optional redemption of
     the Senior Subordinated Notes); or

          (n) CNC shall create, incur, assume or suffer to exist any Lien upon
     any of its property, assets or revenues, whether now owned or hereafter
     acquired;

then, and in any such event, (A) if such event is an Event of Default specified
in clause (i) or (ii) of paragraph (f) of this Section with respect to any
Borrower, any Significant Subsidiary or any group of Subsidiaries that, taken
together, would constitute a Significant Subsidiary, automatically the Revolving
Credit Commitments shall immediately terminate and automatically the Revolving
Credit Loans hereunder (with accrued interest thereon) and all other amounts
owing under this Agreement (including, without limitation, all amounts of L/C
Obligations, whether or not the beneficiaries of the then outstanding Letters of
Credit shall have presented the documents required thereunder) shall immediately
become due and payable, and (B) if such event is any other Event of Default,
either or both of the following actions may be taken: (i) with the consent of
the Majority Lenders, the Administrative Agent may, or upon the request of the
Majority Lenders, the Administrative Agent shall, by notice to the Borrowers
declare the Revolving Credit Commitments to be terminated forthwith, whereupon
the Revolving Credit Commitments shall immediately terminate; and (ii) with the
consent of the Majority Lenders, the Administrative

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                                                                              70

Agent may, or upon the request of the Majority Lenders, the Administrative Agent
shall, by notice to the Borrowers, declare the Revolving Credit Loans hereunder
(with accrued interest thereon) and all other amounts owing under this Agreement
(including, without limitation, all amounts of L/C Obligations, whether or not
the beneficiaries of the then outstanding Letters of Credit shall have presented
the documents required thereunder) and the Revolving Credit Notes to be due and
payable forthwith, whereupon the same shall immediately become due and payable.

         With respect to all Letters of Credit with respect to which presentment
for honor shall not have occurred at the time of an acceleration pursuant to the
preceding paragraph, the Borrowers shall at such time deposit in a cash
collateral account opened by the Administrative Agent an amount equal to the
aggregate then undrawn and unexpired amount of such Letters of Credit. The
Borrowers hereby grant to the Administrative Agent, for the benefit of the
Issuing Lender and the L/C Participants, a security interest in such cash
collateral to secure all obligations of the Borrowers under this Agreement and
the other Loan Documents. Amounts held in such cash collateral account shall be
applied by the Administrative Agent to the payment of drafts drawn under such
Letters of Credit, and the unused portion thereof after all such Letters of
Credit shall have expired or been fully drawn upon, if any, shall be applied to
repay other obligations of the Borrowers hereunder and under the Revolving
Credit Notes. Within three days after all such Letters of Credit shall have
expired or been fully drawn upon, all Reimbursement Obligations shall have been
satisfied and all other obligations of the Borrowers hereunder and under the
Revolving Credit Notes shall have been paid in full, the balance, if any, in
such cash collateral account shall be returned to the Borrowers. The Borrowers
shall execute and deliver to the Administrative Agent, for the account of the
Issuing Lender and the L/C Participants, such further documents and instruments
as the Administrative Agent may request to evidence the creation and perfection
of the within security interest in such cash collateral account.

         Except as expressly provided above in this Section, presentment,
demand, protest and all other notices of any kind are hereby expressly waived.

                      SECTION 10. THE ADMINISTRATIVE AGENT

         10.1. APPOINTMENT. Each Lender hereby irrevocably designates and
appoints CIBC as the Administrative Agent of such Lender under this Agreement
and the other Loan Documents, and each such Lender irrevocably authorizes CIBC
as the Administrative Agent, in such capacity, to take such action on its behalf
under the provisions of this Agreement and the other Loan Documents and to
exercise such powers and perform such duties as are expressly delegated to the
Administrative Agent by the terms of this Agreement and the other Loan
Documents, together with such other powers as are reasonably incidental thereto.
Notwithstanding any provision to the contrary elsewhere in this Agreement, the
Administrative Agent shall have no duties or responsibilities, except those
expressly set forth herein, nor any fiduciary relationship with any Lender, and
no implied covenants, functions, responsibilities, duties, obligations or
liabilities shall be read into this Agreement or any other Loan Document or
otherwise exist against the Administrative Agent.

         10.2. DELEGATION OF DUTIES. The Administrative Agent may execute any of
its duties under this Agreement and the other Loan Documents by or through
agents or

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                                                                              71

attorneys-in-fact and shall be entitled to advice of counsel concerning all
matters pertaining to such duties. The Administrative Agent shall not be
responsible for the negligence or misconduct of any agents or attorneys-in-fact
selected by it with reasonable care.

         10.3. EXCULPATORY PROVISIONS. Neither the Administrative Agent nor any
of its officers, directors, employees, agents, attorneys-in-fact or Affiliates
shall be (i) liable for any action lawfully taken or omitted to be taken by it
or such Person under or in connection with this Agreement or any other Loan
Document (except for its or such Person's own gross negligence or willful
misconduct) or (ii) responsible in any manner to any of the Lenders for any
recitals, statements, representations or warranties made by any Borrower or any
officer thereof contained in this Agreement or any other Loan Document or in any
certificate, report, statement or other document referred to or provided for in,
or received by the Administrative Agent under or in connection with, this
Agreement or any other Loan Document or for the value, validity, effectiveness,
genuineness, enforceability or sufficiency of this Agreement or any other Loan
Document or for any failure of any Borrower to perform its obligations hereunder
or thereunder. The Administrative Agent shall not be under any obligation to any
Lender to ascertain or to inquire as to the observance or performance of any of
the agreements contained in, or conditions of, this Agreement or any other Loan
Document, or to inspect the properties, books or records of the Borrowers.

         10.4. RELIANCE BY ADMINISTRATIVE AGENT. The Administrative Agent shall
be entitled to rely, and shall be fully protected in relying, upon any Note,
writing, resolution, notice, consent, certificate, affidavit, letter, telecopy,
telex or teletype message, statement, order or other document or conversation
reasonably believed by it to be genuine and correct and to have been signed,
sent or made by the proper Person or Persons and upon advice and statements of
legal counsel (including, without limitation, counsel to the Borrowers),
independent accountants and other experts selected by it. The Administrative
Agent may deem and treat the payee of any Note as the owner thereof for all
purposes unless a written notice of assignment, negotiation or transfer thereof
shall have been filed with the Administrative Agent. The Administrative Agent
shall be fully justified in failing or refusing to take any action under this
Agreement or any other Loan Document unless it shall first receive such advice
or concurrence of the Majority Lenders as it deems appropriate or it shall first
be indemnified to its satisfaction by the Lenders against any and all liability
and expense which may be incurred by it by reason of taking or continuing to
take any such action. The Administrative Agent shall in all cases be fully
protected in acting, or in refraining from acting, under this Agreement and the
other Loan Documents in accordance with a request of the Majority Lenders, and
such request and any action taken or failure to act pursuant thereto shall be
binding upon all the Lenders and all future holders of the Revolving Credit
Loans.

         10.5. NOTICE OF DEFAULT. The Administrative Agent shall not be deemed
to have knowledge or notice of the occurrence of any Default or Event of Default
hereunder unless the Administrative Agent has received notice from a Lender or a
Borrower referring to this Agreement, describing such Default or Event of
Default and stating that such notice is a "notice of default". In the event that
the Administrative Agent receives such a notice, the Administrative Agent shall
give notice thereof reasonably promptly to the Lenders. The Administrative Agent
shall take such action reasonably promptly with respect to such Default or Event
of Default as shall be reasonably directed by the Majority Lenders; provided
that unless and until the

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                                                                              72

Administrative Agent shall have received such directions, the Administrative
Agent may (but shall not be obligated to) take such action, or refrain from
taking such action, with respect to such Default or Event of Default as it shall
deem advisable in the best interests of the Lenders.

         10.6. NON-RELIANCE ON ADMINISTRATIVE AGENT AND OTHER LENDERS. Each
Lender expressly acknowledges that neither the Administrative Agent nor any of
its officers, directors, employees, agents, attorneys-in-fact or Affiliates has
made any representations or warranties to it and that no act by the
Administrative Agent hereinafter taken, including any review of the affairs of
the Borrowers or any other Loan Party, shall be deemed to constitute any
representation or warranty by the Administrative Agent to any Lender. Each
Lender represents to the Administrative Agent that it has, independently and
without reliance upon the Administrative Agent or any other Lender, and based on
such documents and information as it has deemed appropriate, made its own
appraisal of and investigation into the business, operations, property,
financial and other condition and creditworthiness of any Borrower and made its
own decision to make its Revolving Credit Loans hereunder and enter into this
Agreement. Each Lender also represents that it will, independently and without
reliance upon the Administrative Agent or any other Lender, and based on such
documents and information as it shall deem appropriate at the time, continue to
make its own credit analysis, appraisals and decisions in taking or not taking
action under this Agreement and the other Loan Documents, and to make such
investigation as it deems necessary to inform itself as to the business,
operations, property, financial and other condition and creditworthiness of any
Borrower or any of the other Loan Parties and the other Loan Parties. Except for
notices, reports and other documents expressly required to be furnished to the
Lenders by the Administrative Agent hereunder, the Administrative Agent shall
not have any duty or responsibility to provide any Lender with any credit or
other information concerning the business, operations, property, condition
(financial or otherwise), prospects or creditworthiness of any Borrower or any
of the other Loan Parties which may come into the possession of the
Administrative Agent or any of its officers, directors, employees, agents,
attorneys-in-fact or Affiliates.

         10.7. INDEMNIFICATION. The Lenders agree to indemnify the
Administrative Agent in its capacity as such (to the extent not reimbursed by
the Borrowers or any of the other Loan Parties and without limiting the
obligation of the Borrowers or any of the other Loan Parties to do so), ratably
according to their respective Revolving Credit Commitment Percentages in effect
on the date on which indemnification is sought, from and against any and all
liabilities, obligations, losses, damages, penalties, actions, judgments, suits,
costs, expenses or disbursements of any kind whatsoever which may at any time
(including, without limitation, at any time following the payment of the
Revolving Credit Loans) be imposed on, incurred by or asserted against the
Administrative Agent in any way relating to or arising out of, the Revolving
Credit Commitments, this Agreement, any of the other Loan Documents or any
documents contemplated by or referred to herein or therein or the transactions
contemplated hereby or thereby or any action taken or omitted by the
Administrative Agent under or in connection with any of the foregoing; provided
that no Lender shall be liable for the payment of any portion of such
liabilities, obligations, losses, damages, penalties, actions, judgments, suits,
costs, expenses or disbursements resulting from the Administrative Agent's gross
negligence or willful misconduct, as the case may be. The agreements in this
subsection shall survive the payment of the Revolving Credit Loans and all other
amounts payable hereunder.

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                                                                              73

         10.8. ADMINISTRATIVE AGENT IN ITS INDIVIDUAL CAPACITY. The
Administrative Agent and its Affiliates may make loans to, accept deposits from
and generally engage in any kind of business with the Borrowers as if the
Administrative Agent was not the Administrative Agent hereunder and under the
other Loan Documents. With respect to the Revolving Credit Loans made by it and
with respect to any Letter of Credit issued or participated in by it, the
Administrative Agent shall have the same rights and powers under this Agreement
and the other Loan Documents as any Lender and may exercise the same as though
it were not the Administrative Agent and the terms "Lender" and "Lenders" shall
include the Administrative Agent in its individual capacity.

         10.9. SUCCESSOR ADMINISTRATIVE AGENT. The Administrative Agent may
resign as Administrative Agent upon 10 days' notice to the Lenders. If the
Administrative Agent shall resign as Administrative Agent under this Agreement
and the other Loan Documents, then the Majority Lenders shall appoint from among
the Lenders a successor agent for the Lenders, which successor agent (provided
that it shall have been approved by the Borrowers), shall succeed to the rights,
powers and duties of the Administrative Agent hereunder. Effective upon such
appointment and approval, the term "Administrative Agent" shall mean such
successor agent, and such former Administrative Agent's rights, powers and
duties as Administrative Agent shall be terminated, without any other or further
act or deed on the part of such former Administrative Agent or any of the
parties to this Agreement or any holders of the Revolving Credit Loans. After
any retiring Administrative Agent's resignation as Administrative Agent, the
provisions of this Section 10 shall inure to its benefit as to any actions taken
or omitted to be taken by it while it was an Administrative Agent under this
Agreement and the other Loan Documents.

         10.10. ISSUING LENDER. The provisions of this Section 10 shall apply to
the Issuing Lender in its capacity as such to the same extent that such
provisions apply to the Administrative Agent.

         10.11. RELEASES OF GUARANTEES AND COLLATERAL. In connection with the
sale or other disposition of all of the Capital Stock of any Guarantors (other
than CNG) permitted under subsection 8.6 or the sale or other disposition of
Collateral permitted under subsection 8.6, the Administrative Agent shall, and
is hereby authorized by the Lenders to, promptly, upon the request of the
Borrowers and at the sole expense of the Borrowers, take all actions reasonably
necessary to release such Guarantor from its guarantee contained in the
Guarantee and Collateral Agreement or its Guarantee or to release the Collateral
subject to such sale or other disposition, as the case may be, and shall take
any other actions reasonably requested by the Borrowers to effect the
transactions permitted under subsection 8.6.

                           SECTION 11. MISCELLANEOUS

         11.1. AMENDMENTS AND WAIVERS. Neither this Agreement nor any other Loan
Document, nor any terms hereof or thereof may be amended, supplemented or
modified except in accordance with the provisions of this subsection. The
Majority Lenders may, or, with the written consent of the Majority Lenders, the
Administrative Agent may, from time to time, (a) enter into with the Borrowers
and the other Loan Parties written amendments, supplements or modifications
hereto and to the other Loan Documents for the purpose of amending,
supplementing or modifying any provisions of this Agreement or the other Loan
Documents or

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                                                                              74

changing in any manner the rights of the Lenders or of the Borrowers hereunder
or thereunder or (b) waive, on such terms and conditions as the Majority Lenders
or the Administrative Agent, as the case may be, may specify in such instrument,
any of the requirements of this Agreement or the other Loan Documents or any
Default or Event of Default and its consequences; provided, however, that no
such waiver and no such amendment, supplement or modification shall:

               (i) eliminate or reduce the voting rights of any Lender under
          this subsection 11.1, or reduce the amount or extend the scheduled
          date of maturity of any Revolving Credit Loan or any installment
          thereof or any Reimbursement Obligation or reduce the stated rate of
          any interest or fee payable hereunder or extend the scheduled date of
          any payment thereof or increase the amount or extend the expiration
          date of any Lender's Revolving Credit Commitment, in each case without
          the consent of each Lender affected thereby; or

               (ii) reduce the percentage specified in the definition of
          Majority Lenders, or consent to the assignment or transfer by any
          Borrower of any of its rights and obligations under this Agreement and
          the other Loan Documents or release all or substantially all of the
          guarantee obligations contained in the Guarantee and Collateral
          Agreement, the CNG Guarantee and Cash Collateral Agreement and the
          other Guarantees or release all or substantially all of the Collateral
          (other than in connection with any release permitted by subsection
          10.11), in each case without the written consent of all the Lenders;
          or

               (iii) amend, modify or waive any provision of Section 10 without
          the written consent of the then Administrative Agent; or

               (iv) amend, modify or waive the provisions of any Letter of
          Credit or any L/C Obligation without the written consent of the
          Issuing Lender.

         Any such waiver and any such amendment, supplement or modification
shall apply equally to each of the Lenders and shall be binding upon the
Borrowers, the Lenders, the Administrative Agent and all future holders of the
Revolving Credit Loans. In the case of any waiver, the Borrowers, the Lenders
and the Administrative Agent shall be restored to their former positions and
rights hereunder and under the other Loan Documents, and any Default or Event of
Default waived shall be deemed to be cured and not continuing; no such waiver
shall extend to any subsequent or other Default or Event of Default or impair
any right consequent thereon.

         11.2. NOTICES. All notices, requests and demands to or upon the
respective parties hereto to be effective shall be in writing (including by
facsimile transmission) and, unless otherwise expressly provided herein, shall
be deemed to have been duly given or made (a) in the case of delivery by hand or
by overnight courier, when delivered, (b) in the case of delivery by mail, three
days after being deposited in the mails, postage prepaid, or (c) in the case of
delivery by facsimile transmission, when sent and receipt has been confirmed,
addressed as follows in the case of the Borrowers and the Administrative Agent,
and as set forth in Schedule I in the case of the other parties hereto, or to
such other address as may be hereafter notified by the respective parties
hereto:

<PAGE>

                                                                              75

         The Borrowers:

                  c/o Cole National Group, Inc.
                  5915 Landerbrook Drive
                  Mayfield Heights, Ohio 44124
                  Attention:  Joseph Gaglioti
                  Fax: (216) 461-3489

         with a copy to:

                  Jones, Day, Reavis & Pogue
                  North Point
                  901 Lakeside Avenue
                  Cleveland, Ohio 44114
                  Attention:  David P. Porter, Esq.
                  Fax: (216) 579-0212

         The Administrative Agent:

                  Canadian Imperial Bank of Commerce
                  425 Lexington Avenue
                  7th Floor
                  New York, New York  10017
                  Attention:  Agency Services
                  Fax:  (212) 856-3763

PROVIDED that any notice, request or demand to or upon the Administrative Agent
or the Lenders pursuant to subsection 2.3, 2.5, 3.2, 4.2, 4.4 or 4.8 shall not
be effective until received.

         11.3. NO WAIVER; CUMULATIVE REMEDIES. No failure to exercise and no
delay in exercising, on the part of the Administrative Agent or any Lender, any
right, remedy, power or privilege hereunder or under the other Loan Documents
shall operate as a waiver thereof; nor shall any single or partial exercise of
any right, remedy, power or privilege hereunder preclude any other or further
exercise thereof or the exercise of any other right, remedy, power or privilege.
The rights, remedies, powers and privileges herein provided are cumulative and
not exclusive of any rights, remedies, powers and privileges provided by law.

         11.4. SURVIVAL OF REPRESENTATIONS AND WARRANTIES. All representations
and warranties made hereunder, in the other Loan Documents (or in any amendment,
modification or supplement hereto or thereto) and in any document, certificate
or statement delivered pursuant hereto or in connection herewith shall survive
the execution and delivery of this Agreement and the making of the Revolving
Credit Loans hereunder.

         11.5. PAYMENT OF EXPENSES AND TAXES. The Borrowers agree, jointly and
severally, (a) to pay or reimburse the Administrative Agent for all its
out-of-pocket costs and expenses incurred in connection with the development,
preparation and execution of, and any amendment, supplement or modification to,
this Agreement and the other Loan Documents and any other documents prepared in
connection herewith or therewith, and the consummation and

<PAGE>

                                                                              76

administration of the transactions contemplated hereby and thereby (including
the syndication of the Revolving Credit Commitments (including the reasonable
expenses of the Administrative Agent's due diligence investigation)), including,
without limitation, the reasonable fees and disbursements of counsel to the
Administrative Agent, (b) to pay or reimburse each Lender and the Administrative
Agent for all their respective costs and expenses incurred in connection with
the enforcement of any rights under this Agreement, the other Loan Documents and
any such other documents, including, without limitation, the fees and
disbursements of counsel (including the allocated fees and expenses of in-house
counsel) to the respective Lenders and the Administrative Agent, (c) to pay,
indemnify, and hold each Lender and the Administrative Agent harmless from, any
and all recording and filing fees and any and all liabilities with respect to,
or resulting from any delay in paying, stamp, excise and other Non-Excluded
Taxes, if any, which may be payable or determined to be payable in connection
with the execution and delivery of, or consummation or administration of any of
the transactions contemplated by, or any amendment, supplement or modification
of, or any waiver or consent under or in respect of, this Agreement, the other
Loan Documents and any such other documents, and (d) to pay, indemnify, and hold
each Lender and the Administrative Agent and their respective directors,
trustees, officers, employees and agents harmless from and against any and all
other liabilities, obligations, losses, damages, penalties, actions, judgments,
suits, costs, expenses or disbursements of any kind or nature whatsoever with
respect to the execution, delivery, enforcement, performance and administration
of this Agreement, the other Loan Documents or the use or proposed use of the
proceeds of the Revolving Credit Loans in connection with the transactions
contemplated hereby and thereby and any such other documents regardless of
whether the Administrative Agent or any Lender is a party to the litigation or
other proceeding giving rise thereto, including, without limitation, any of the
foregoing relating to the violation of, noncompliance with or liability under,
any Environmental Law applicable to the operations of any Borrower, any of its
Subsidiaries or any of the facilities and properties owed, leased or operated by
any Borrower or any of its Subsidiaries (all the foregoing in this clause (d),
collectively, the "indemnified liabilities"), PROVIDED that the Borrowers shall
have no obligation hereunder to the Administrative Agent or any Lender or any
other Person with respect to indemnified liabilities arising from the gross
negligence or willful misconduct of the party seeking indemnification. The
agreements in this subsection shall survive repayment of the Revolving Credit
Loans and all other amounts payable hereunder.

         11.6. SUCCESSORS AND ASSIGNS; PARTICIPATIONS AND ASSIGNMENTS. (a) This
Agreement shall be binding upon and inure to the benefit of the Borrowers, the
Lenders, the Administrative Agent and their respective successors and assigns,
except that no Borrower may assign or transfer any of its rights or obligations
under this Agreement without the prior written consent of each Lender.

         (b) Any Lender may, in the ordinary course of its business or
investment activities and in accordance with applicable law, at any time sell to
one or more banks or other entities ("PARTICIPANTS") participating interests in
any Revolving Credit Loan owing to such Lender, any Revolving Credit Commitment
of such Lender or any other interest of such Lender hereunder and under the
other Loan Documents. Each Lender which sells a participating interest hereunder
shall notify the Borrowers of the identity of such Participant within a
reasonable time after such sale. In the event of any such sale by a Lender of a
participating interest to a Participant, such Lender's obligations under this
Agreement to the other parties to this

<PAGE>

                                                                              77

Agreement shall remain unchanged, such Lender shall remain solely responsible
for the performance thereof, such Lender shall remain the holder of any such
Revolving Credit Loan for all purposes under this Agreement and the other Loan
Documents, and the Borrowers and the Administrative Agent shall continue to deal
solely and directly with such Lender in connection with such Lender's rights and
obligations under this Agreement and the other Loan Documents. No Lender shall
be entitled to create in favor of any Participant, in the participation
agreement pursuant to which such Participant's participating interest shall be
created or otherwise, any right to vote on, consent to or approve any matter
relating to this Agreement or any other Loan Document except for those matters
specified in clauses (i) and (ii) of the proviso to subsection 11.1. The
Borrowers agree that if amounts outstanding under this Agreement are due or
unpaid, or shall have been declared or shall have become due and payable upon
the occurrence of an Event of Default, each Participant shall, to the maximum
extent permitted by applicable law, be deemed to have the right of setoff in
respect of its participating interest in amounts owing under this Agreement to
the same extent as if the amount of its participating interest were owing
directly to it as a Lender under this Agreement, PROVIDED that, in purchasing
such participating interest, such Participant shall be deemed to have agreed to
share with the Lenders the proceeds thereof as provided in subsection 11.7(a) as
fully as if it were a Lender hereunder. The Borrowers also agree that each
Participant shall be entitled to the benefits of subsections 4.10, 4.11 and 4.12
with respect to its participation in the Revolving Credit Commitments and the
Revolving Credit Loans outstanding from time to time as if it was a Lender;
PROVIDED that, in the case of subsection 4.11, such Participant shall have
complied with the requirements of said subsection and PROVIDED, FURTHER that no
Participant shall be entitled to receive any greater amount pursuant to any such
subsection than the transferor Lender would have been entitled to receive in
respect of the amount of the participation transferred by such transferor Lender
to such Participant had no such transfer occurred.

         (c) Any Lender may, in the ordinary course of its business or
investment activities and in accordance with applicable law, at any time and
from time to time assign to any Lender or any branch or affiliate thereof or,
with the consent of the Borrowers and the Administrative Agent (which in each
case shall not be unreasonably withheld or delayed), to an additional bank or
financial institution (an "ASSIGNEE") all or any part of its rights and
obligations under this Agreement and the other Loan Documents pursuant to an
Assignment and Acceptance, substantially in the form of Exhibit F, executed by
such Assignee and such assigning Lender (and, in the case of an Assignee that is
not then a Lender or a branch or an affiliate thereof, by the Borrowers and the
Administrative Agent) and delivered to the Administrative Agent for its
acceptance and recording in the Register, PROVIDED that, in the case of any such
assignment to an additional bank or financial institution, if such assignment is
of less than all of the rights and obligations of the assigning Lender, the sum
of the aggregate principal amount of the Revolving Credit Loans, the aggregate
amount of the L/C Obligations and the aggregate amount of the Available
Revolving Credit Commitment being assigned shall not be less than $5,000,000 (or
such lesser amount as may be agreed to by the Borrowers and the Administrative
Agent). Upon such execution, delivery, acceptance and recording, from and after
the effective date determined pursuant to such Assignment and Acceptance, (x)
the Assignee thereunder shall be a party hereto and, to the extent provided in
such Assignment and Acceptance, have the rights and obligations of a Lender
hereunder with a Revolving Credit Commitment as set forth therein, and (y) the
assigning Lender thereunder shall, to the extent provided in such Assignment and
Acceptance, be released from its obligations under this

<PAGE>

                                                                              78

Agreement (and, in the case of an Assignment and Acceptance covering all or the
remaining portion of an assigning Lender's rights and obligations under this
Agreement, such assigning Lender shall cease to be a party hereto but shall
nonetheless continue to be entitled to the benefits of subsections 4.10, 4.11,
4.12 and 11.5). Notwithstanding any provision of this paragraph (c) and
paragraph (e) of this subsection, the consent of the Borrowers shall not be
required, and, unless requested by the Assignee and/or the assigning Lender, new
Revolving Credit Notes shall not be required to be executed and delivered by the
Borrowers, for any assignment which occurs at any time when any of the Events of
Default described in Section 9(f) shall have occurred and be continuing.

         (d) The Administrative Agent, on behalf of the Borrowers, shall
maintain at the address of the Administrative Agent referred to in subsection
11.2 a copy of each Assignment and Acceptance delivered to it and a register
(the "REGISTER") for the recordation of the names and addresses of the Lenders
and the Revolving Credit Commitments of, and principal amounts of the Revolving
Credit Loans owing to, and any Revolving Credit Notes evidencing the Revolving
Credit Loans owned by, each Lender from time to time. The entries in the
Register shall be conclusive, in the absence of manifest error, and the
Borrowers, the Administrative Agent and the Lenders shall treat each Person
whose name is recorded in the Register as the owner of a Revolving Credit Loan
or other obligation hereunder as the owner thereof for all purposes of this
Agreement and the other Loan Documents, notwithstanding any notice to the
contrary. Any assignment of any Revolving Credit Loan or other obligation
hereunder shall be effective only upon appropriate entries with respect thereto
being made in the Register. The Register shall be available for inspection by
the Borrowers or any Lender at any reasonable time and from time to time upon
reasonable prior notice.

         (e) Upon its receipt of an Assignment and Acceptance executed by an
assigning Lender and an Assignee (and, in the case of an Assignee that is not
then a Lender or an affiliate thereof, by the Borrowers and the Administrative
Agent) together with payment to the Administrative Agent of a registration and
processing fee of $3,500, the Administrative Agent shall promptly accept such
Assignment and Acceptance and record the information contained therein in the
Register and give notice of such acceptance and recordation to the Lenders and
the Borrowers. Such Assignment and Acceptance and the assignment evidenced
thereby shall only be effective upon appropriate entries with respect to the
information contained therein being made in the Register pursuant to subsection
11.6(d).

         (f) The Borrowers authorize each Lender to disclose to any Participant
or Assignee (each, a "TRANSFEREE") and any prospective Transferee, subject to
such Person agreeing to comply with the provisions of subsection 11.15, any and
all financial and other information in such Lender's possession concerning the
Borrowers and their Affiliates which has been delivered to such Lender by or on
behalf of the Borrowers pursuant to this Agreement or which has been delivered
to such Lender by or on behalf of the Borrowers in connection with such Lender's
credit evaluation of the Borrowers and their Affiliates prior to becoming a
party to this Agreement.

         (g) For avoidance of doubt, the parties to this Agreement acknowledge
that the provisions of this subsection concerning assignments of Revolving
Credit Loans and Revolving Credit Notes relate only to absolute assignments and
that such provisions do not prohibit

<PAGE>

                                                                              79

assignments creating security interests, including, without limitation, any
pledge or assignment by a Lender of any Revolving Credit Loan or Revolving
Credit Note to any Federal Reserve Bank in accordance with applicable law.

         11.7. ADJUSTMENTS; SET-OFF. (a) If any Lender (a "BENEFITTED LENDER")
shall at any time receive any payment of all or part of its Revolving Credit
Loans or the Reimbursement Obligations owing to it, or interest thereon, or
receive any collateral in respect thereof (whether voluntarily or involuntarily,
by set-off, pursuant to events or proceedings of the nature referred to in
Section 9(f), or otherwise), in a greater proportion than any such payment to or
collateral received by any other Lender, if any, in respect of such other
Lender's Revolving Credit Loans or the Reimbursement Obligations owing to it, or
interest thereon, such benefitted Lender shall purchase for cash from the other
Lenders a participating interest (or, at the option of such benefitted Lender, a
direct interest) in such portion of each such other Lender's Revolving Credit
Loan or the Reimbursement Obligations owing to it, or shall provide such other
Lenders with the benefits of any such collateral, or the proceeds thereof, as
shall be necessary to cause such benefitted Lender to share the excess payment
or benefits of such collateral or proceeds ratably with each of the Lenders;
PROVIDED, HOWEVER, that if all or any portion of such excess payment or benefits
is thereafter recovered from such benefitted Lender, such purchase shall be
rescinded, and the purchase price and benefits returned, to the extent of such
recovery, but without interest.

         (b) In addition to any rights and remedies of the Lenders provided by
law, each Lender shall have the right, without prior notice to the Borrowers,
any such notice being expressly waived by the Borrowers to the extent permitted
by applicable law, upon any amount remaining unpaid (including, without
limitation, any amount owing to such Lender in respect of an undivided interest
purchased by such Lender in any draft paid by the Issuing Lender under any
Letter of Credit pursuant to subsection 3.4(a)) after it becomes due and payable
by the Borrowers hereunder (whether at the stated maturity, by acceleration or
otherwise) to set-off and appropriate and apply against such amount any and all
deposits (general or special, time or demand, provisional or final), in any
currency, and any other credits, indebtedness or claims, in any currency, in
each case whether direct or indirect, absolute or contingent, matured or
unmatured, at any time held or owing by such Lender or any affiliate, branch or
agency thereof to or for the credit or the account of any Borrower. Each Lender
agrees promptly to notify the Borrowers and the Administrative Agent after any
such set-off and application made by such Lender, PROVIDED that the failure to
give such notice shall not affect the validity of such set-off and application.

         11.8. COUNTERPARTS. This Agreement may be executed by one or more of
the parties to this Agreement on any number of separate counterparts (including
by facsimile transmission), and all of said counterparts taken together shall be
deemed to constitute one and the same instrument. A set of the copies of this
Agreement signed by all the parties shall be lodged with the Borrowers and the
Administrative Agent.

         11.9. SEVERABILITY. Any provision of this Agreement which is prohibited
or unenforceable in any jurisdiction shall, as to such jurisdiction, be
ineffective to the extent of such prohibition or unenforceability without
invalidating the remaining provisions hereof, and any such prohibition or
unenforceability in any jurisdiction shall not invalidate or render
unenforceable such provision in any other jurisdiction.

<PAGE>

                                                                              80

         11.10. INTEGRATION. This Agreement and the other Loan Documents and the
Fee Letter, dated as of May 23, 2002, between CNG and the Administrative Agent
represent the agreement of the Borrowers, the Administrative Agent and the
Lenders with respect to the subject matter hereof, and there are no promises,
undertakings, representations or warranties by the Administrative Agent or any
Lender relative to subject matter hereof not expressly set forth or referred to
herein or in the other Loan Documents or the Fee Letter.

         11.11. GOVERNING LAW. THIS AGREEMENT AND THE RIGHTS AND OBLIGATIONS OF
                --------------
THE PARTIES HEREUNDER SHALL BE GOVERNED BY, AND CONSTRUED AND INTERPRETED IN
ACCORDANCE WITH, THE LAW OF THE STATE OF NEW YORK.

         11.12. SUBMISSION TO JURISDICTION; WAIVERS. Each Borrower hereby
irrevocably and unconditionally:

          (a) submits for itself and its property in any legal action or
     proceeding relating to this Agreement and the other Loan Documents to which
     it is a party, or for recognition and enforcement of any judgment in
     respect thereof, to the non-exclusive general jurisdiction of the courts of
     the State of New York, the courts of the United States of America for the
     Southern District of New York, and appellate courts from any thereof;

          (b) consents that any such action or proceeding may be brought in such
     courts and waives any objection that it may now or hereafter have to the
     venue of any such action or proceeding in any such court or that such
     action or proceeding was brought in an inconvenient court and agrees not to
     plead or claim the same;

          (c) agrees that service of process in any such action or proceeding
     may be effected by mailing a copy thereof by registered or certified mail
     (or any substantially similar form of mail), postage prepaid, to such
     Borrower at its address set forth in subsection 11.2 or at such other
     address of which the Administrative Agent shall have been notified pursuant
     thereto;

          (d) agrees that nothing herein shall affect the right to effect
     service of process in any other manner permitted by law or shall limit the
     right to sue in any other jurisdiction; and

          (e) waives, to the maximum extent not prohibited by law, any right it
     may have to claim or recover in any legal action or proceeding referred to
     in this subsection any exemplary, punitive or consequential damages.

         11.13. ACKNOWLEDGEMENTS. Each Borrower hereby acknowledges that:

          (a) it has been advised by counsel in the negotiation, execution and
     delivery of this Agreement and the other Loan Documents;

          (b) neither the Administrative Agent nor any Lender has any fiduciary
     relationship with or duty to such Borrower arising out of or in connection
     with this Agreement or any of the other Loan Documents, and the
     relationship between

<PAGE>

                                                                              81

     Administrative Agent and Lenders, on one hand, and such Borrower, on the
     other hand, in connection herewith or therewith is solely that of debtor
     and creditor; and

          (c) no joint venture is created hereby or by the other Loan Documents
     or otherwise exists by virtue of the transactions contemplated hereby among
     the Lenders or among the Borrowers and the Lenders.

         11.14. WAIVERS OF JURY TRIAL. EACH BORROWER, THE ADMINISTRATIVE AGENT
                ---------------------
AND THE LENDERS HEREBY IRREVOCABLY AND UNCONDITIONALLY WAIVE TRIAL BY JURY IN
ANY LEGAL ACTION OR PROCEEDING RELATING TO THIS AGREEMENT OR ANY OTHER LOAN
DOCUMENT AND FOR ANY COUNTERCLAIM THEREIN.

         11.15. CONFIDENTIALITY. Each Lender agrees to keep confidential any
written information (a) provided to it by or on behalf of the Borrowers or any
of their Subsidiaries pursuant to or in connection with this Agreement or (b)
obtained by such Lender based on a review of the books and records of the
Borrowers or any of their Subsidiaries; PROVIDED that nothing herein shall
prevent any Lender from disclosing any such information (i) to the
Administrative Agent or any other Lender for use in connection with the
transactions contemplated by this Agreement and the other Loan Documents, (ii)
to any Transferee or prospective Transferee which agrees to comply with the
provisions of this subsection, (iii) to its employees, directors, agents,
attorneys, accountants and other professional advisors for use in connection
with the transactions contemplated by this Agreement and the other Loan
Documents, (iv) upon the request or demand of any Governmental Authority having
jurisdiction over such Lender or as shall be required pursuant to any
Requirement of Law, (v) in response to any order of any court or other
Governmental Authority or as may otherwise be required pursuant to any
Requirement of Law, (vi) in connection with any litigation to which such Lender
is a party, (vii) which has been publicly disclosed other than in breach of this
Agreement, or (viii) to the extent reasonably necessary, in connection with the
exercise of any remedy hereunder; PROVIDED, however, that, if such Lender or any
Person to whom such Lender supplies any such information becomes legally
compelled to disclosed any such information or otherwise intends to disclose any
such information in any of the circumstances contemplated by clauses (iv), (v),
(vi) or (vii) above, such Lender agrees to provide the Borrowers as promptly as
practicable with prior written notice of such compelled or intended disclosure.

         11.16. REFERENCE TO AND EFFECT ON THE EXISTING CREDIT AGREEMENT. On and
after the date hereof, each reference to the "Credit Agreement" in any of the
Security Documents, the other Loan Documents and all other agreements, documents
and instruments delivered by all or one or more of the Borrower, the Lender, the
Administrative Agent and any other Person shall mean and be a reference to this
Agreement. Except as specifically amended hereby, the Existing Credit Agreement
shall remain in full force and in effect in the form of this Agreement, and is
hereby ratified and confirmed in such form.

<PAGE>

         IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
duly executed and delivered by their proper and duly authorized officers as of
the day and year first above written.

                                        COLE VISION CORPORATION

                                        By:
                                           -------------------------------------
                                           Name:
                                           Title:

                                        THINGS REMEMBERED, INC.

                                        By:
                                           -------------------------------------
                                           Name:
                                           Title:

                                        PEARLE, INC.

                                        By:
                                           -------------------------------------
                                           Name:
                                           Title:

                                        CANADIAN IMPERIAL BANK OF
                                          COMMERCE, NEW YORK AGENCY,
                                          as Administrative Agent

                                        By:
                                           -------------------------------------
                                           Name:
                                           Title:

<PAGE>

                                        CIBC INC.

                                        By:
                                           -------------------------------------
                                           Name:
                                           Title:

<PAGE>

                                        LEHMAN COMMERCIAL PAPER INC.

                                        By:
                                           -------------------------------------
                                           Name:
                                           Title:

<PAGE>

                                        WACHOVIA BANK, NATIONAL ASSOCIATION

                                        By:
                                           -------------------------------------
                                           Name:
                                           Title:

<PAGE>

                                        KEYBANK NATIONAL ASSOCIATION

                                        By:
                                           -------------------------------------
                                           Name:
                                           Title:

<PAGE>

                                        FIFTH THIRD BANK

                                        By:
                                           -------------------------------------
                                           Name:
                                           Title:

<PAGE>

                                                                      Schedule I
                                                             To Credit Agreement
                                                             -------------------

                   REVOLVING CREDIT COMMITMENTS AND ADDRESSES

                                                    Revolving Credit Commitments
                                                    ----------------------------

CIBC INC.                                                  $16,666,666.67
425 Lexington Avenue, 7th Floor
New York, NY 10017
Attention: Agency Services
Telecopy: 212-856-3763

LEHMAN COMMERCIAL PAPER INC.                               $16,666,666.67
745 Seventh Ave.
19th Floor
New York, NY 10019

WACHOVIA BANK, NATIONAL ASSOCIATION                        $16,666,666.66
PA4821
1345 Chestnut Street, 3 Widener
Philadelphia, PA 19101

KEYBANK NATIONAL ASSOCIATION                               $10,000,000.00
127 Public Square
Mail Code: OH-01-27-0606
Cleveland, OH 44114

FIFTH THIRD BANK                                           $15,000,000.00
1404 East 9th Street
Cleveland, OH 44114

<PAGE>

                                                                     Schedule II
                                                             to Credit Agreement

            APPLICABLE MARGIN CALCULATION FOR REVOLVING CREDIT LOANS

<TABLE>
<CAPTION>

                                                                        Abr Loans               Eurodollar Loan
Leverage Ratio                                                      Applicable Margin          Applicable Margin
--------------                                                      -----------------          -----------------
<S>                                                                       <C>                        <C>
Greater than 3.25 to 1.00                                                  1.25%                      2.25%

Greater than 2.75 to 1.00, but less than or
equal to 3.25 to 1.00                                                      1.00%                      2.00%

Less than or equal to 2.75 to 1.00                                         0.75%                      1.75%
</TABLE>

Notwithstanding the foregoing table, (a) during the period from and including
the Closing Date until the date which is six month thereafter, the Applicable
Margin in respect of Revolving Credit Loans shall equal (i) with respect to ABR
Loans, 1.25% per annum and (ii) with respect to Eurodollar Loans 2.25% per
annum, and (b) the Applicable Margin will be adjusted on each Adjustment Date
after such period to the applicable rate per annum set forth above under the
heading "ABR Loans Applicable Margin" or "Eurodollar Loans Applicable Margin"
minus .25% per annum in the event that, immediately preceding such Adjustment
Date, (i) the senior unsecured long-term debt of CNG shall be rated at least
"BBB-" by Standard & Poor's, a division of McGraw-Hill, Inc., and (ii) the
Administrative Agent shall have received written notice of such rating from a
Borrower.

                                 COMMITMENT FEES

Percentage of Revolving Credit
Commitments Used                                      Commitment Fees
------------------------------                        ---------------

Greater than 33.3%                                         0.50%

Less than or equal to 33.3%                                0.75%<PAGE>
                                                                    EXHIBIT 10.2

================================================================================

                            COLE NATIONAL GROUP, INC.

                    8 7/8% SENIOR SUBORDINATED NOTES DUE 2012

                            ------------------------

                                    INDENTURE

                            Dated as of May 22, 2002

                            ------------------------

                            ------------------------

                        Wells Fargo Bank Minnesota, N.A.

                                     Trustee

                            ------------------------

================================================================================
<PAGE>

                             CROSS-REFERENCE TABLE*

<TABLE>
<CAPTION>

<S>                                                                                    <C>
        Trust Indenture
        Act Section                                                                    Indenture Section
        310(a)(1)...................................................................             7.10
             (a)(2).................................................................             7.10
             (a)(3).................................................................             N.A.
             (a)(4).................................................................             N.A.
             (a)(5).................................................................             7.10
             (b)....................................................................             7.10
             (c)....................................................................             N.A.
        311  (a)....................................................................             7.11
             (b)....................................................................             7.11
             (c)....................................................................             N.A.
        312  (a)....................................................................             2.05
             (b)....................................................................            13.03
             (c)....................................................................            13.03
        313  (a)....................................................................             7.06
             (b)(1).................................................................             N.A.
             (b)(2).................................................................          7.06; 7.07
             (c)....................................................................         7.06; 13.02
             (d)....................................................................             7.06
        314  (a)....................................................................      4.03; 13.02; 13.05
             (b)....................................................................             N.A.
             (c)(1).................................................................            13.04
             (c)(2).................................................................            13.04
             (c)(3).................................................................             N.A.
             (d)....................................................................             N.A.
             (e)....................................................................            13.05
             (f)....................................................................             N.A.
        315  (a)....................................................................             7.01
             (b)....................................................................         7.05; 13.02
             (c)....................................................................             7.01
             (d)....................................................................             7.01
             (e)....................................................................             6.11
        316  (a) (last sentence)....................................................             2.09
             (a)(1)(A)..............................................................             6.05
             (a)(1)(B)..............................................................             6.04
             (a)(2).................................................................             N.A.
             (b)....................................................................             6.07
             (c)....................................................................             2.12
        317  (a)(1).................................................................             6.08
             (a)(2).................................................................             6.09
             (b)....................................................................             2.04
        318  (a)....................................................................            13.01
             (b)....................................................................             N.A.
             (c)....................................................................            13.01
</TABLE>

N.A. means not applicable.
* This Cross Reference Table is not part of the Indenture.

<PAGE>

                                TABLE OF CONTENTS

<TABLE>
<CAPTION>

                                                                                                               Page

                                                    ARTICLE 1.
                                           DEFINITIONS AND INCORPORATION
                                                   BY REFERENCE
<S>                   <C>                                                                                       <C>
   Section 1.01       Definitions.................................................................................1
   Section 1.02       Other Definitions..........................................................................21
   Section 1.03       Incorporation by Reference of Trust Indenture Act..........................................21
   Section 1.04       Rules of Construction......................................................................22

                                                    ARTICLE 2.
                                                    THE NOTES

   Section 2.01       Form and Dating............................................................................22
   Section 2.02       Execution and Authentication...............................................................23
   Section 2.03       Registrar and Paying Agent.................................................................23
   Section 2.04       Paying Agent to Hold Money in Trust........................................................24
   Section 2.05       Holder Lists...............................................................................24
   Section 2.06       Transfer and Exchange......................................................................24
   Section 2.07       Replacement Notes..........................................................................35
   Section 2.08       Outstanding Notes..........................................................................35
   Section 2.09       Treasury Notes.............................................................................36
   Section 2.10       Temporary Notes............................................................................36
   Section 2.11       Cancellation...............................................................................36
   Section 2.12       Defaulted Interest.........................................................................36

                                                    ARTICLE 3.
                                             REDEMPTION AND PREPAYMENT

   Section 3.01       Notices to Trustee.........................................................................37
   Section 3.02       Selection of Notes to Be Redeemed or Purchased.............................................37
   Section 3.03       Notice of Redemption.......................................................................37
   Section 3.04       Effect of Notice of Redemption.............................................................38
   Section 3.05       Deposit of Redemption or Purchase Price....................................................38
   Section 3.06       Notes Redeemed or Purchased in Part........................................................39
   Section 3.07       Optional Redemption........................................................................39
   Section 3.08       Mandatory Redemption.......................................................................40
   Section 3.09       Offer to Purchase by Application of Excess Proceeds........................................40

                                                    ARTICLE 4.
                                                    COVENANTS

   Section 4.01       Payment of Notes...........................................................................41
   Section 4.02       Maintenance of Office or Agency............................................................42
   Section 4.03       Reports....................................................................................42
   Section 4.04       Compliance Certificate.....................................................................43
   Section 4.05       Taxes......................................................................................43
   Section 4.06       Stay, Extension and Usury Laws.............................................................44
   Section 4.07       Restricted Payments........................................................................44
   Section 4.08       Dividend and Other Payment Restrictions Affecting Subsidiaries.............................47
   Section 4.09       Incurrence of Indebtedness and Issuance of Preferred Stock.................................48
   Section 4.10       Asset Sales................................................................................50
</TABLE>

                                       i

<PAGE>

<TABLE>

<S>                   <C>                                                                                       <C>
   Section 4.11       Transactions with Affiliates...............................................................52
   Section 4.12       Liens......................................................................................53
   Section 4.13       Corporate Existence........................................................................53
   Section 4.14       Offer to Repurchase Upon Change of Control.................................................53
   Section 4.15       No Senior Subordinated Debt................................................................55
   Section 4.16       Limitation on Sale and Leaseback Transactions..............................................55
   Section 4.17       Limitation on Capital Stock of Restricted Subsidiaries.....................................55
   Section 4.18       Future Note Guarantees.....................................................................56
   Section 4.19       Limitation on Designation of Restricted and Unrestricted Subsidiaries......................56
   Section 4.20       Payments for Consent.......................................................................57

                                                    ARTICLE 5.
                                                   SUCCESSORS

   Section 5.01       Merger, Consolidation, or Sale of Assets...................................................57
   Section 5.02       Successor Corporation Substituted..........................................................58

                                                    ARTICLE 6.
                                               DEFAULTS AND REMEDIES

   Section 6.01       Events of Default..........................................................................58
   Section 6.02       Acceleration...............................................................................59
   Section 6.03       Other Remedies.............................................................................60
   Section 6.04       Waiver of Past Defaults....................................................................60
   Section 6.05       Control by Majority........................................................................61
   Section 6.06       Limitation on Suits........................................................................61
   Section 6.07       Rights of Holders of Notes to Receive Payment..............................................61
   Section 6.08       Collection Suit by Trustee.................................................................61
   Section 6.09       Trustee May File Proofs of Claim...........................................................62
   Section 6.10       Priorities.................................................................................62
   Section 6.11       Undertaking for Costs......................................................................62

                                                    ARTICLE 7.
                                                    TRUSTEE

   Section 7.01       Duties of Trustee..........................................................................63
   Section 7.02       Rights of Trustee..........................................................................64
   Section 7.03       Individual Rights of Trustee...............................................................64
   Section 7.04       Trustee's Disclaimer.......................................................................64
   Section 7.05       Notice of Defaults.........................................................................65
   Section 7.06       Reports by Trustee to Holders of the Notes.................................................65
   Section 7.07       Compensation and Indemnity.................................................................65
   Section 7.08       Replacement of Trustee.....................................................................66
   Section 7.09       Successor Trustee by Merger, etc...........................................................67
   Section 7.10       Eligibility; Disqualification..............................................................67
   Section 7.11       Preferential Collection of Claims Against Company..........................................67

                                                    ARTICLE 8.
                                     LEGAL DEFEASANCE AND COVENANT DEFEASANCE

   Section 8.01       Option to Effect Legal Defeasance or Covenant Defeasance...................................67
   Section 8.02       Legal Defeasance and Discharge.............................................................67
   Section 8.03       Covenant Defeasance........................................................................68
   Section 8.04       Conditions to Legal or Covenant Defeasance.................................................68
</TABLE>

                                       ii
<PAGE>

<TABLE>

<S>                   <C>                                                                                       <C>
  Section 8.05       Deposited Money and Government Securities to be Held in Trust; Other Miscellaneous
   Provisions        ............................................................................................69
   Section 8.06       Repayment to Company.......................................................................70
   Section 8.07       Reinstatement..............................................................................70

                                                    ARTICLE 9.
                                         AMENDMENT, SUPPLEMENT AND WAIVER

   Section 9.01       Without Consent of Holders of Notes........................................................71
   Section 9.02       With Consent of Holders of Notes...........................................................71
   Section 9.03       Compliance with Trust Indenture Act........................................................73
   Section 9.04       Revocation and Effect of Consents..........................................................73
   Section 9.05       Notation on or Exchange of Notes...........................................................73
   Section 9.06       Trustee to Sign Amendments, etc............................................................73

                                                    ARTICLE 10.
                                                   Subordination

   Section 10.01      Notes Subordinate to Senior Debt...........................................................73
   Section 10.02      Payment Over of Proceeds upon Dissolution, etc.............................................74
   Section 10.03      Suspension of Payment When Senior Indebtedness in Default..................................75
   Section 10.04      Trustee's Relation to Senior Debt..........................................................76
   Section 10.05      Subrogation to Rights of Holders of Senior Debt............................................76
   Section 10.06      Provisions Solely to Define Relative Rights................................................77
   Section 10.07      Trustee to Effectuate Subordination........................................................77
   Section 10.08      No Waiver of Subordination Provisions......................................................77
   Section 10.09      Notice to Trustee..........................................................................78
   Section 10.10      Reliance on Judicial Order or Certificate of Liquidating Agent.............................79
   Section 10.11      Rights of Trustee as a Holder of Senior Debt; Preservation of Trustee's Rights.............79
   Section 10.12      Article Applicable to Paying Agents........................................................79
   Section 10.13      No Suspension of Remedies..................................................................79
   Section 10.14      Amendments.................................................................................79

                                                    ARTICLE 11.
                                                  NOTE GUARANTEES

   Section 11.01      Guarantee..................................................................................80
   Section 11.02      Subordination of Note Guarantee............................................................81
   Section 11.03      Limitation on Guarantor Liability..........................................................81
   Section 11.04      Execution and Delivery of Note Guarantee...................................................81
   Section 11.05      Guarantors May Consolidate, etc., on Certain Terms.........................................81
   Section 11.06      Releases Following Sale of Assets..........................................................82
   Section 11.07      Operation..................................................................................83

                                                    ARTICLE 12.
                                            satisfaction and discharge

   Section 12.01      Satisfaction and Discharge.................................................................83
   Section 12.02      Application of Trust Money.................................................................84

                                                    ARTICLE 13.
                                                   MISCELLANEOUS

   Section 13.01      Trust Indenture Act Controls...............................................................84
   Section 13.02      Notices....................................................................................84
   Section 13.03      Communication by Holders of Notes with Other Holders of Notes..............................85
</TABLE>

                                      iii

<PAGE>

<TABLE>

<S>                   <C>                                                                                       <C>
   Section 13.04      Certificate and Opinion as to Conditions Precedent.........................................85
   Section 13.05      Statements Required in Certificate or Opinion..............................................86
   Section 13.06      Rules by Trustee and Agents................................................................86
   Section 13.07      No Personal Liability of Directors, Officers, Employees and Stockholders...................86
   Section 13.08      Governing Law..............................................................................86
   Section 13.09      No Adverse Interpretation of Other Agreements..............................................86
   Section 13.10      Successors.................................................................................87
   Section 13.11      Severability...............................................................................87
   Section 13.12      Counterpart Originals......................................................................87
   Section 13.13      Table of Contents, Headings, etc...........................................................87

                                                     EXHIBITS

Exhibit A         FORM OF NOTE
Exhibit B         FORM OF CERTIFICATE OF TRANSFER
Exhibit C         FORM OF CERTIFICATE OF EXCHANGE
Exhibit D         FORM OF CERTIFICATE OF ACQUIRING INSTITUTIONAL ACCREDITED INVESTOR
Exhibit E         FORM OF NOTE GUARANTEE
Exhibit F         FORM OF SUPPLEMENTAL INDENTURE
</TABLE>

                                       iv

<PAGE>

         INDENTURE dated as of May 22, 2002 between Cole National Group, Inc., a
Delaware corporation (the "Company"), and Wells Fargo Bank Minnesota, N.A., as
trustee (the "Trustee").

         The Company and the Trustee agree as follows for the benefit of each
other and for the equal and ratable benefit of the Holders (as defined) of the
8 7/8% Senior Subordinated Notes due 2012 (the "Notes"):

                                   ARTICLE 1.
                          DEFINITIONS AND INCORPORATION
                                  BY REFERENCE

Section 1.01  Definitions.

         "144A Global Note" means a Global Note substantially in the form of
Exhibit A hereto bearing the Global Note Legend and the Private Placement Legend
and deposited with or on behalf of, and registered in the name of, the
Depositary or its nominee that will be issued in a denomination equal to the
outstanding principal amount of the Notes sold in reliance on Rule 144A.

         "8 5/8% Notes" means the Company's 8 5/8% Senior Subordinated Notes due
         2007.

         "8 5/8% Notes Indenture" means the indenture relating to the 8 5/8%
         Notes.

         "9 7/8% Notes" means the Company's 9 7/8% Senior Subordinated Notes due
         2006.

         "9 7/8% Notes Indenture" means the indenture relating to the 9 7/8%
         Notes.

         "Acquired Debt" means, with respect to any specified Person:

                  (1) Indebtedness of any other Person existing at the time such
         other Person was merged with or into or became a Subsidiary of such
         specified Person, whether or not such Indebtedness is incurred in
         connection with, or in contemplation of, such other Person merging with
         or into, or becoming a Subsidiary of, such specified Person; and

                  (2) Indebtedness secured by a Lien encumbering any asset
         acquired by such specified Person.

         "Additional Notes" means any Notes (other than the Initial Notes)
issued under this Indenture in accordance with Sections 2.02 and 4.09 hereof, as
part of the same series as the Initial Notes.

         "Affiliate" of any specified Person means any other Person directly or
indirectly controlling or controlled by or under direct or indirect common
control with such specified Person. For purposes of this definition, "control,"
as used with respect to any Person, means the possession, directly or
indirectly, of the power to direct or cause the direction of the management or
policies of such Person, whether through the ownership of voting securities, by
agreement or otherwise. For purposes of this definition, the terms
"controlling," "controlled by" and "under common control with" have correlative
meanings.

         "Agent" means any Registrar, co-registrar, Paying Agent or additional
paying agent.

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

                                       1
<PAGE>

         "Asset Sale" means:

                  (1) the sale, lease, conveyance or other disposition of any
         assets or rights; provided that the sale, conveyance or other
         disposition of all or substantially all of the assets of the Company
         and its Subsidiaries taken as a whole will be governed by the
         provisions of Section 4.14 and/or Section 5.01 and not by the
         provisions of Section 4.10 hereof; and

                  (2) the issuance of Equity Interests by any of the Company's
         Restricted Subsidiaries or the sale of Equity Interests in any of its
         Subsidiaries.

         Notwithstanding the preceding, none of the following items will be
         deemed to be an Asset Sale:

                  (1) any single transaction or series of related transactions
         that involves assets having a fair market value of less than $5.0
         million;

                  (2) a transfer of assets or other disposition between or among
         the Company and its Wholly-Owned Restricted Subsidiaries or between the
         Company and another Person if, after giving effect to such transaction,
         the other Person becomes a Wholly-Owned Restricted Subsidiary of the
         Company;

                  (3) an issuance of Equity Interests by a Restricted Subsidiary
         to the Company or to another Wholly-Owned Restricted Subsidiary;

                  (4) the sale, lease, conveyance or other disposition of
         equipment, inventory, accounts receivable or other assets in the
         ordinary course of business;

                  (5) the sale or other disposition of cash or Cash Equivalents;

                  (6) a Restricted Payment or Permitted Investment that is
         permitted by Section 4.07 hereof;

                  (7) the licensing or sublicensing of intellectual property or
         other general intangibles and licenses, leases or subleases of other
         property in the ordinary course of business and that do not materially
         interfere with the business of the Company and its Subsidiaries;

                  (8) bona fide foreclosures on assets;

                  (9) any sale, transfer or other disposition to any Person if,
         after such sale, transfer or other disposition, such Person becomes a
         Wholly-Owned Restricted Subsidiary; and

                  (10) any release of intangible claims or rights in connection
         with a bona fide lawsuit, dispute or other controversy.

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

                                       2
<PAGE>

         "Bankruptcy Law" means Title 11, U.S. Code or any similar federal or
state law for the relief of debtors.

         "Beneficial Owner" has the meaning assigned to such term in Rule 13d-3
and Rule 13d-5 under the Exchange Act, except that in calculating the beneficial
ownership of any particular "person" (as that term is used in Section 13(d)(3)
of the Exchange Act), such "person" will be deemed to have beneficial ownership
of all securities that such "person" has the right to acquire by conversion or
exercise of other securities, whether such right is currently exercisable or is
exercisable only upon the occurrence of a subsequent condition. The terms
"Beneficially Owns" and "Beneficially Owned" have a corresponding meaning.

         "Board of Directors" means:

                  (1) with respect to a corporation, the board of directors of
         the corporation;

                  (2) with respect to a partnership, the Board of Directors of
         the general partner of the partnership; and

                  (3) with respect to any other Person, the board or any
         committee of such Person serving a similar function.

         "Broker-Dealer" has the meaning set forth in the Registration Rights
Agreement.

         "Business Day" means any day other than a Legal Holiday.

         "Capital Lease Obligation" means, at the time any determination is to
be made, the amount of the liability in respect of a capital lease that would at
that time be required to be capitalized on a balance sheet in accordance with
GAAP.

         "Capital Stock" means:

                  (1) in the case of a corporation, corporate stock;

                  (2) in the case of an association or business entity, any and
         all shares, interests, participations, rights or other equivalents
         (however designated) of corporate stock;

                  (3) in the case of a partnership or limited liability company,
         partnership or membership interests (whether general or limited); and

                  (4) any other interest or participation that confers on a
         Person the right to receive a share of the profits and losses of, or
         distributions of assets of, the issuing Person.

         "Cash Equivalents" means:

                  (1) marketable, direct obligations issued or guaranteed by the
         United States of America, or by any governmental agency or political
         subdivision thereof, maturing with 365 days of the date of purchase;

                  (2) United States dollar denominated time deposits and United
         States dollar denominated certificates of deposit (including Eurodollar
         time deposits and certificates of deposit) maturing within 365 days of
         the date of purchase thereof issued by any United States or Canadian
         national, provincial or state (including the District of Columbia)
         banking institution having capital, surplus and undivided profits
         aggregating at least $250.0 million, or by any

                                       3
<PAGE>

         British, French, German, Japanese or Swiss national banking institution
         having capital, surplus and undivided profits aggregating at least $1.0
         billion, in each case that is (a) rated at least "A" by Standard &
         Poor's Corporation or at least "A-2" by Moody Investors Service Inc.,
         or (b) that is a party to the Senior Credit Facility;

                  (3) commercial paper maturing within 270 days after the
         issuance thereof that has the highest credit rating of either of such
         rating agencies;

                  (4) readily marketable direct obligations issued by any state
         of the United States of America or any political subdivision thereof
         having the highest rating obtainable from either of such rating
         agencies;

                  (5) tax exempted and tax advantaged instruments including,
         without limitation, municipal bonds, commercial paper, auction rate
         preferred stock and variable rate demand obligations with the highest
         short-term ratings by either of such rating agencies or a long-term
         debt rating of "AAA" from Standard & Poor's Corporation;

                  (6) repurchase agreements and reverse repurchase agreements
         with institutions described in clause (2) above that are fully secured
         by obligations described in clause (1) above; and

                  (7) money market funds not exceeding 365 days in duration that
         invest substantially all of such funds' assets in the terms described
         in the preceding clauses (1) through (5).

         "Clearstream" means Clearstream Banking, S.A.

         "Change of Control" means the occurrence of any of the following:

                  (1) the direct or indirect sale, 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
         properties or assets of the Company and its Restricted Subsidiaries
         taken as a whole to any "person" (as that term is used in Section
         13(d)(3) of the Exchange Act) other than a Permitted Holder;

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

                  (3) the consummation of any transaction (including, without
         limitation, any merger or consolidation) the result of which is that
         any "person" (as defined above), other than a Permitted Holder, becomes
         the Beneficial Owner, directly or indirectly, of more than 50% of the
         Voting Stock of the Company or the Parent, measured by voting power
         rather than number of shares;

                  (4) the first day on which a majority of the members of the
         Board of Directors of the Company or the Parent are not Continuing
         Directors; or

                  (5) the first day on which the Parent ceases to own 80% of the
         outstanding Voting Stock of the Company.

         "Company" means Cole National Group, Inc., and any and all successors
thereto.

                                       4
<PAGE>

         "Consolidated Cash Flow" means, with respect to any specified Person
for any period, the Consolidated Net Income of such Person for such period plus:

                  (1) an amount equal to any net loss realized by such Person or
         any of its Restricted Subsidiaries in connection with an Asset Sale, to
         the extent such loss was deducted in computing such Consolidated Net
         Income; plus

                  (2) provision for taxes based on income or profits of such
         Person and its Restricted Subsidiaries for such period, to the extent
         that such provision for taxes was deducted in computing such
         Consolidated Net Income; plus

                  (3) consolidated interest expense of such Person and its
         Restricted Subsidiaries for such period, whether paid or accrued and
         whether or not capitalized (including, without limitation, amortization
         of debt issuance costs and original issue discount, non-cash interest
         payments, the interest component of any deferred payment obligations,
         the interest component of all payments associated with Capital Lease
         Obligations, imputed interest with respect to Attributable Debt,
         commissions, discounts and other fees and charges incurred in respect
         of letter of credit or bankers' acceptance financings, and net of the
         effect of all payments made or received pursuant to Hedging
         Obligations), to the extent that any such expense was deducted in
         computing such Consolidated Net Income; plus

                  (4) depreciation, amortization (including amortization of
         goodwill and other intangibles but excluding amortization of prepaid
         cash expenses that were paid in a prior period) and other non-cash
         expenses (excluding any such non-cash expense to the extent that it
         represents an accrual of or reserve for cash expenses in any future
         period or amortization of a prepaid cash expense that was paid in a
         prior period) of such Person and its Restricted Subsidiaries for such
         period to the extent that such depreciation, amortization and other
         non-cash expenses were deducted in computing such Consolidated Net
         Income; minus

                  (5) non-cash items increasing such Consolidated Net Income for
         such period, other than the accrual of revenue in the ordinary course
         of business,

in each case, on a consolidated basis and determined in accordance with GAAP.

         Notwithstanding the preceding, the provision for taxes based on the
income or profits of, and the depreciation and amortization and other non-cash
expenses of, a Restricted Subsidiary of the Company will be added to
Consolidated Net Income to compute Consolidated Cash Flow of the Company only to
the extent that a corresponding amount would be permitted at the date of
determination to be dividended to the Company by such Restricted Subsidiary
without prior governmental approval (that has not been obtained), and without
direct or indirect restriction pursuant to the terms of its charter and all
agreements, instruments, judgments, decrees, orders, statutes, rules and
governmental regulations applicable to that Restricted Subsidiary or its
stockholders.

         "Consolidated Net Income" means, with respect to any specified Person
for any period, the aggregate of the Net Income of such Person and its
Restricted Subsidiaries for such period, on a consolidated basis, determined in
accordance with GAAP; provided that:

                  (1) the Net Income (but not loss) of any Person that is not a
         Restricted Subsidiary or that is accounted for by the equity method of
         accounting will be included only to the extent of the amount of
         dividends or distributions paid in cash to the specified Person or a
         Wholly-Owned Restricted Subsidiary of the Person;

                                       5
<PAGE>

                  (2) the Net Income of any Restricted Subsidiary will be
         excluded to the extent that the declaration or payment of dividends or
         similar distributions by that Restricted Subsidiary of that Net Income
         is not at the date of determination permitted without any prior
         governmental approval (that has not been obtained) or, directly or
         indirectly, by operation of the terms of its charter or any agreement,
         instrument, judgment, decree, order, statute, rule or governmental
         regulation applicable to that Restricted Subsidiary or its
         stockholders;

                  (3) the Net Income of any Person acquired in a pooling of
         interests transaction for any period prior to the date of such
         acquisition will be excluded;

                  (4) the cumulative effect of a change in accounting principles
         will be excluded;

                  (5) the Net Income (but not loss) of any Unrestricted
         Subsidiary will be excluded, whether or not distributed to the
         specified Person or one of its Subsidiaries; and

                  (6) extraordinary, unusual and non-recurring gains, charges
         and losses will be excluded.

         "Continuing Directors" means, as of any date of determination, any
member of the Board of Directors of the Company or the Parent who:

                  (1) was a member of such Board of Directors on the date of
         this Indenture; or

                  (2) was nominated for election or elected to such Board of
         Directors with the approval of a majority of the Continuing Directors
         who were members of such Board at the time of such nomination or
         election.

         "Corporate Trust Office of the Trustee" will be at the address of the
Trustee specified in Section 13.02 hereof or such other address as to which the
Trustee may give notice to the Company.

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

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

         "Definitive Note" means a certificated Note registered in the name of
the Holder thereof and issued in accordance with Section 2.06 hereof,
substantially in the form of Exhibit A hereto except that such Note shall not
bear the Global Note Legend and shall not have the "Schedule of Exchanges of
Interests in the Global Note" attached thereto.

         "Depositary" means, with respect to the Notes issuable or issued in
whole or in part in global form, the Person specified in Section 2.03 hereof as
the Depositary with respect to the Notes, and any and all successors thereto
appointed as depositary hereunder and having become such pursuant to the
applicable provision of this Indenture.

         "Designated Senior Debt" means:

                  (1) any Indebtedness outstanding under the Senior Credit
         Facility; and

                                       6
<PAGE>

                  (2) after payment in full of all Obligations under the Senior
         Credit Facility, any other Senior Debt permitted under this Indenture
         the principal amount of which is $25.0 million or more and that has
         been designated by the Company as "Designated Senior Debt."

         "Disqualified Stock" means any Capital Stock that, by its terms (or by
the terms of any security into which it is convertible, or for which it is
exchangeable, in each case at the option of the holder of the Capital Stock), or
upon the happening of any event, matures or is mandatorily redeemable, pursuant
to a sinking fund obligation or otherwise, or redeemable at the option of the
holder of the Capital Stock, in whole or in part, on or prior to the date that
is 91 days after the date on which the Notes mature. Notwithstanding the
preceding sentence, any Capital Stock that would constitute Disqualified Stock
solely because the holders of the Capital Stock have the right to require the
Company to repurchase such Capital Stock upon the occurrence of a change of
control or an asset sale will not constitute Disqualified Stock if the terms of
such Capital Stock provide that the Company may not repurchase or redeem any
such Capital Stock pursuant to such provisions unless such repurchase or
redemption complies with Section 4.07 hereof.

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

         "Euroclear" means Euroclear Bank S.A./N.V., as operator of the
Euroclear system.

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

         "Exchange Notes" means the Notes issued in the Exchange Offer pursuant
to Section 2.06(f) hereof.

         "Exchange Offer" has the meaning set forth in the Registration Rights
Agreement.

         "Exchange Offer Registration Statement" has the meaning set forth in
the Registration Rights Agreement.

         "Existing Indebtedness" means Indebtedness of the Company and its
Restricted Subsidiaries (other than Indebtedness under the Senior Credit
Facility) in existence on the date of this Indenture, until such amounts are
repaid and commitments are permanently reduced.

         "Fixed Charges" means, with respect to any specified Person for any
period, the sum, without duplication, of:

                  (1) the consolidated interest expense of such Person and its
         Restricted Subsidiaries for such period, whether paid or accrued,
         including, without limitation, amortization of debt issuance costs and
         original issue discount, non-cash interest payments, the interest
         component of any deferred payment obligations, the interest component
         of all payments associated with Capital Lease Obligations, imputed
         interest with respect to Attributable Debt, commissions, discounts and
         other fees and charges incurred in respect of letter of credit or
         bankers' acceptance financings, and net of the effect of all payments
         made or received pursuant to Hedging Obligations; plus

                  (2) the consolidated interest of such Person and its
         Restricted Subsidiaries that was capitalized during such period; plus

                  (3) any interest expense on Indebtedness of another Person
         that is Guaranteed by such Person or one of its Restricted Subsidiaries
         (other than Permitted Guarantees, except to the

                                       7
<PAGE>

         extent called on) or secured by a Lien on assets of such Person or one
         of its Restricted Subsidiaries, whether or not such Guarantee or Lien
         is called upon; plus

                  (4) the product of (a) all dividends, whether paid or accrued
         and whether or not in cash, on any series of preferred stock of such
         Person or any of its Restricted Subsidiaries, other than dividends on
         Equity Interests payable solely in Equity Interests of the Company
         (other than Disqualified Stock) or to the Company or a Restricted
         Subsidiary of the Company, times (b) a fraction, the numerator of which
         is one and the denominator of which is one minus the then current
         combined federal, state and local statutory tax rate of such Person,
         expressed as a decimal, in each case, on a consolidated basis and in
         accordance with GAAP.

         "Fixed Charge Coverage Ratio" means with respect to any specified
Person for any period, the ratio of the Consolidated Cash Flow of such Person
and its Restricted Subsidiaries for such period to the Fixed Charges of such
Person and its Restricted Subsidiaries for such period. In the event that the
specified Person or any of its Restricted Subsidiaries incurs, assumes,
Guarantees, repays, repurchases or redeems any Indebtedness (other than ordinary
working capital borrowings) or issues, repurchases or redeems preferred stock
subsequent to the commencement of the period for which the Fixed Charge Coverage
Ratio is being calculated and on or prior to the date on which the event for
which the calculation of the Fixed Charge Coverage Ratio is made (the
"Calculation Date"), then the Fixed Charge Coverage Ratio will be calculated
giving pro forma effect to such incurrence, assumption, Guarantee, repayment,
repurchase or redemption of Indebtedness, or such issuance, repurchase or
redemption of preferred stock, and the use of the proceeds therefrom as if the
same had occurred at the beginning of the applicable four-quarter reference
period.

         In addition, for purposes of calculating the Fixed Charge Coverage
Ratio:

                  (1) acquisitions and dispositions that have been made by the
         specified Person or any of its Restricted Subsidiaries, including
         through mergers or consolidations and including any related financing
         transactions, during the four-quarter reference period or subsequent to
         such reference period and on or prior to the Calculation Date will be
         given pro forma effect as if they had occurred on the first day of the
         four-quarter reference period and Consolidated Cash Flow for such
         reference period will be calculated on a pro forma basis in accordance
         with Regulation S-X under the Securities Act, but without giving effect
         to clause (3) of the proviso set forth in the definition of
         Consolidated Net Income;

                  (2) if since the beginning of the reference period any Person
         (that subsequently became a Restricted Subsidiary of the Company or was
         merged with or into the Company or any Restricted Subsidiary of the
         Company since the beginning of that period) has made any acquisitions
         and dispositions including through mergers or consolidations and
         including any related financing transactions that would have required
         adjustment pursuant to this definition, then the Fixed Charge Coverage
         Ratio will be calculated giving pro forma effect thereto (as described
         in paragraph (1) above) for the reference period as if the acquisition
         or disposition had occurred at the beginning of the applicable
         four-quarter period;

                  (3) the Consolidated Cash Flow attributable to discontinued
         operations, as determined in accordance with GAAP, and operations or
         businesses disposed of prior to the Calculation Date, will be excluded;
         and

                  (4) the Fixed Charges attributable to discontinued operations,
         as determined in accordance with GAAP, and operations or businesses
         disposed of prior to the Calculation Date, will be excluded, but only
         to the extent that the obligations giving rise to such Fixed Charges
         will not be

                                       8
<PAGE>

         obligations of the specified Person or any of its Restricted
         Subsidiaries following the Calculation Date.

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

         "Global Notes" means, individually and collectively, each of the
Restricted Global Notes and the Unrestricted Global Notes, substantially in the
form of Exhibit A hereto issued in accordance with Section 2.01, 2.06(b)(3),
2.06(b)(4), 2.06(d)(2) or 2.06(f) hereof.

         "Global Note Legend" means the legend set forth in Section 2.06(g)(2),
which is required to be placed on all Global Notes issued under this Indenture.

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

         "Guarantee" means a guarantee other than by endorsement of negotiable
instruments for collection in the ordinary course of business, direct or
indirect, in any manner including, without limitation, by way of a pledge of
assets or through letters of credit or reimbursement agreements in respect
thereof, of all or any part of any Indebtedness.

         "Guarantors" means each Restricted Subsidiary of the Company that
executes a Note Guarantee in accordance with the provisions of this Indenture,
and its successors and assigns.

         "Hedging Obligations" means, with respect to any specified Person, the
obligations of such Person under:

                  (1) interest rate swap agreements, interest rate cap
         agreements and interest rate collar agreements;

                  (2) other agreements or arrangements designed to protect such
         Person against fluctuations in interest rates; and

                  (3) agreements entered into solely for the purpose of fixing
         or hedging the risks associated with fluctuations in foreign currency
         exchange rates,

in each case, in reasonable relation to the Person's business and not for
speculative purposes.

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

         "Indebtedness" means, with respect to any specified Person, any
indebtedness of such Person, whether or not contingent:

                  (1) in respect of borrowed money;

                  (2) evidenced by bonds, notes, debentures or similar
         instruments or letters of credit (or reimbursement agreements in
         respect thereof);

                  (3) in respect of banker's acceptances;

                                       9
<PAGE>

                  (4) representing Capital Lease Obligations;

                  (5) representing the balance deferred and unpaid of the
         purchase price of any property, except any such balance that
         constitutes an accrued expense or trade payable or other accrued
         liabilities arising in the ordinary course of business; or

                  (6) representing any Hedging Obligations,

if and to the extent any of the preceding items (other than letters of credit
and Hedging Obligations) would appear as a liability upon a balance sheet of the
specified Person prepared in accordance with GAAP. In addition, the term
"Indebtedness" includes all Indebtedness of others secured by a Lien on any
asset of the specified Person (whether or not such Indebtedness is assumed by
the specified Person) and, to the extent not otherwise included, the Guarantee
by the specified Person of any Indebtedness of any other Person.

         The amount of any Indebtedness outstanding as of any date will be:

                  (1) the accreted value of the Indebtedness, in the case of any
         Indebtedness issued with original issue discount; and

                  (2) the principal amount of the Indebtedness, together with
         any interest on the Indebtedness that is more than 30 days past due, in
         the case of any other Indebtedness.

         "Indenture" means this Indenture, as amended or supplemented from time
to time.

         "Indirect Participant" means a Person who holds a beneficial interest
in a Global Note through a Participant.

         "Initial Notes" means the first $150.0 million aggregate principal
amount of Notes issued under this Indenture on the date hereof.

         "Initial Purchasers" means Lehman Brothers Inc., CIBC World Markets
Corp. and McDonald Investments Inc.

         "Institutional Accredited Investor" means an institution that is an
"accredited investor" as defined in Rule 501(a)(1), (2), (3) or (7) under the
Securities Act, who are not also QIBs.

         "Investments" means, with respect to any Person, all direct or indirect
investments by such Person in other Persons (including Affiliates) in the forms
of loans (including Guarantees or other obligations), advances or capital
contributions (excluding commission, travel and similar advances to officers and
employees made in the ordinary course of business), purchases or other
acquisitions for consideration of Indebtedness, Equity Interests or other
securities, together with all items that are or would be classified as
investments on a balance sheet prepared in accordance with GAAP. Investments
shall exclude (1) extensions of trade credit on commercially reasonably terms in
accordance with normal trade practices and (2) the repurchase of securities of
any Person by such Person. If the Company or any Restricted Subsidiary of the
Company sells or otherwise disposes of any Equity Interests of any direct or
indirect Restricted Subsidiary of the Company such that, after giving effect to
any such sale or disposition, such Person is no longer a Restricted Subsidiary
of the Company, the Company will be deemed to have made an Investment on the
date of any such sale or disposition equal to the fair market value of the
Company's Investments in such Restricted Subsidiary that were not sold or
disposed of in an amount determined as provided in the final paragraph of
Section 4.07 hereof. The acquisition by the Company or any Restricted

                                       10
<PAGE>

Subsidiary of the Company of a Person that holds an Investment in a third Person
will be deemed to be an Investment by the Company or such Restricted Subsidiary
in such third Person in an amount equal to the fair market value of the
Investments held by the acquired Person in such third Person in an amount
determined as provided in the final paragraph of Section 4.07 hereof.

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

         "Letter of Transmittal" means the letter of transmittal to be prepared
by the Company and sent to all Holders of the Notes for use by such Holders in
connection with the Exchange Offer.

         "Lien" means, with respect to any asset, any mortgage, lien, pledge,
charge, security interest or encumbrance of any kind in respect of such asset,
whether or not filed, recorded or otherwise perfected under applicable law,
including any conditional sale or other title retention agreement, any lease in
the nature thereof, any option or other agreement to sell or give a security
interest in and any filing of or agreement to give any financing statement under
the Uniform Commercial Code (or equivalent statutes) of any jurisdiction.

         "Liquidated Damages" means all liquidated damages then owing pursuant
to Section 5 of the Registration Rights Agreement.

         "Net Income" means, with respect to any specified Person, the net
income (loss) of such Person, determined in accordance with GAAP and before any
reduction in respect of preferred stock dividends, excluding, however:

                  (1) any gain (but not loss), together with any related
         provision for taxes on such gain (but not loss), realized in connection
         with:

                       (a) any Asset Sale; or

                       (b) the disposition of any securities by such Person or
         any of its Restricted Subsidiaries or the extinguishment of any
         Indebtedness of such Person or any of its Restricted Subsidiaries; and

                  (2) any extraordinary gain (or loss), together with any
         related provision for taxes on such extraordinary gain (or loss).

         "Net Proceeds" means the aggregate cash proceeds received by the
Company or any of its Restricted Subsidiaries in respect of any Asset Sale
(including, without limitation, any cash received upon the sale or other
disposition of any non-cash consideration received in any Asset Sale), net of
the direct costs relating to such Asset Sale, including, without limitation,
legal, accounting and investment banking fees, and sales commissions, and any
relocation expenses incurred as a result of the Asset Sale, taxes paid or
payable as a result of the Asset Sale, in each case, after taking into account
any available tax credits or deductions and any tax sharing arrangements, and
amounts required to be applied to the repayment of Indebtedness, other than
Senior Debt secured by a Lien on the asset or assets that were the subject of
such Asset Sale and any reserve for adjustment in respect of the sale price of
such asset or assets established in accordance with GAAP.

                                       11
<PAGE>

         "Non-Payment Event of Default" means any event (other than a Payment
Default) the occurrence of which entitles one or more Persons to accelerate the
maturity of any Designated Senior Debt.

         "Non-Recourse Debt" means Indebtedness:

                  (1) as to which neither the Company nor any of its Restricted
         Subsidiaries

                      (a) provides credit support of any kind (including any
         undertaking, agreement or instrument that would constitute
         Indebtedness),

                      (b) is directly or indirectly liable as a guarantor or
          otherwise, or

                      (c) constitutes the lender;

                  (2) no default with respect to which (including any rights
         that the holders of the Indebtedness may have to take enforcement
         action against an Unrestricted Subsidiary) would permit upon notice,
         lapse of time or both any holder of any other Indebtedness (other than
         the Notes) of the Company or any of its Restricted Subsidiaries to
         declare a default on such other Indebtedness or cause the payment of
         the Indebtedness to be accelerated or payable prior to its stated
         maturity; and

                  (3) as to which the lenders have been notified in writing that
         they will not have any recourse to the stock or assets of the Company
         or any of its Restricted Subsidiaries.

         "Non-U.S. Person" means a Person who is not a U.S. Person.

         "Note Guarantee" means the Guarantee by each Guarantor of the Company's
payment obligations under this Indenture and on the Notes, executed pursuant to
the provisions of this Indenture.

         "Notes" has the meaning assigned to it in the preamble to this
Indenture. Unless the context otherwise requires, all references to the Notes
shall include the Initial Notes and any Additional Notes.

         "Obligations" means any principal, interest (including, without
limitation, interest accruing or that would have accrued but for the filing of a
bankruptcy, reorganization or other insolvency proceeding whether or not such
interest constitutes an allowable claim in such proceeding), penalties, fees,
indemnifications, reimbursements, damages and other liabilities payable under
the documentation governing, securing or otherwise entered into in connection
with any Indebtedness.

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

         "Officers' Certificate" means a certificate signed on behalf of the
Company by two Officers of the Company, one of whom must be the principal
executive officer, the principal financial officer, the treasurer or the
principal accounting officer of the Company, that meets the requirements of
Section 13.05 hereof.

         "Opinion of Counsel" means an opinion from legal counsel who is
reasonably acceptable to the Trustee, that meets the requirements of Section
13.05 hereof. The counsel may be an employee of or counsel to the Company, any
Subsidiary of the Company or the Trustee.

                                       12
<PAGE>

         "Parent" means Cole National Corporation, a Delaware corporation and
the Company's sole stockholder, or any successor entity thereto pursuant to a
merger or consolidation that results in the voting securities of Parent being
held immediately after the merger or consolidation by the same holders (other
than those that exercise statutory dissenters' rights) that held the voting
securities of Parent immediately before the merger or consolidation and which
merger or consolidation is solely for the purpose of reincorporating Parent in
another State of the United States.

         "Participant" means, with respect to the Depositary, Euroclear or
Clearstream, a Person who has an account with the Depositary, Euroclear or
Clearstream, respectively (and, with respect to DTC, shall include Euroclear and
Clearstream).

         "Payment Default" means any default, whether or not any requirement for
the giving of notice, the lapse of time or both, or any other condition to such
default becoming an event of default has occurred, in the payment of principal
of (or premium, if any) or interest on or any other amount payable in connection
with Designated Senior Debt.

         "Permitted Business" means any business in which the Company and its
Subsidiaries were engaged on the date of this Indenture, and any business
reasonably related or complementary thereto.

         "Permitted Guarantees" means Guarantees of obligations of franchisees
for Indebtedness permitted pursuant to Section 4.09(b)(10) hereof, and any
Guarantees of obligations of franchisees for Indebtedness in existence on the
date of this Indenture, together with any renewals or extensions thereof or
modifications or supplements thereto.

         "Permitted Holder" means:

                  (1) Jeffrey A. Cole;

                  (2) any employee stock ownership plan or "group" (as defined
         in Rules 13d-3 and 13d-5 under the Exchange Act) in which employees of
         the Parent or its Subsidiaries beneficially own at least 25% of the
         common stock of the Company or the Parent owned by such group;

                  (3) the Parent; and

                  (4) any Person that is controlled by one or more of the
         Persons set forth in (1) through (3) above.

         "Permitted Investments" means:

                  (1) any Investment in the Company or in a Wholly-Owned
         Restricted Subsidiary of the Company or in any Guarantor;

                  (2) any Investment in Cash Equivalents;

                  (3) any Investment by the Company or any Restricted Subsidiary
         of the Company in a Person, if as a result of such Investment:

                      (a) such Person becomes a Wholly-Owned Restricted
         Subsidiary of the Company and, if required under Section 4.18 hereof, a
         Guarantor;

                                       13
<PAGE>

                      (b) such Person is merged, consolidated or amalgamated
         with or into, or transfers or conveys substantially all of its assets
         to, or is liquidated into, the Company or a Restricted Subsidiary of
         the Company that, if required under Section 4.18 hereof, is a
         Guarantor; or

                      (c) at the time of such Investment, such Person becomes a
         Guarantor;

                  (4) any Investment made as a result of the receipt of non-cash
         consideration from an Asset Sale that was made pursuant to and in
         compliance with Section 4.10 hereof;

                  (5) any acquisition of assets solely in exchange for the
         issuance of Equity Interests (other than Disqualified Stock) of the
         Company;

                  (6) any Investments received in compromise of obligations of
         such persons incurred in the ordinary course of trade creditors or
         customers that were incurred in the ordinary course of business,
         including pursuant to any plan of reorganization or similar arrangement
         upon the bankruptcy or insolvency of any trade creditor or customer;

                  (7) Hedging Obligations;

                  (8) reasonable and customary loans made to employees in
         connection with their relocation;

                  (9) Investments made by the Company or any Restricted
         Subsidiary of the Company in franchises in a business related to the
         optical business of the Company as conducted on the date of this
         Indenture; provided that, immediately after giving pro forma effect to
         such Investment, the Company could incur $1.00 of additional
         Indebtedness (other than Permitted Debt) under Section 4.09 hereof;
         provided, however, that if the Company may not incur $1.00 of
         additional Indebtedness, but otherwise satisfies the requirement of
         this clause (9), the Company may make Investments in such franchises in
         an amount not to exceed $7.5 million in any fiscal year, which unused
         portion of any such annual amount, if any, may not be applied to any
         Investment in a subsequent fiscal year;

                  (10) other Investments in any Person having an aggregate fair
         market value (measured on the date each such Investment was made and
         without giving effect to subsequent changes in value), when taken
         together with all other Investments made pursuant to this clause (10)
         that are at any time outstanding not to exceed $15.0 million, without
         giving effect to any reduction for any writedown or writeoff of such
         Investment or reduction to the extent credit has already been given
         under Section 4.07(a)(3)(c), (d) or (e) hereof;

                  (11) Investments in securities of trade creditors or customers
         received pursuant to a plan of reorganization or similar arrangement
         upon the bankruptcy or insolvency of such trade creditors or customers;
         and

                  (12) extensions of trade credit in the ordinary course of
         business.

         "Permitted Liens" means:

                  (1) Liens of the Company and any Guarantor securing Senior
         Debt that was permitted by the terms of this Indenture to be incurred;

                                       14
<PAGE>

                  (2) Liens in favor of the Company or any of its Restricted
         Subsidiaries;

                  (3) Liens on property of a Person existing at the time such
         Person is merged with or into or acquired by or consolidated with the
         Company or any Restricted Subsidiary of the Company; provided that such
         Liens were in existence prior to the contemplation of such merger or
         consolidation or acquisition and do not extend to any assets other than
         those of the Person merged with or into or acquired by or consolidated
         with the Company or the Restricted Subsidiary;

                  (4) Liens on property existing at the time of acquisition of
         the property by the Company or any Restricted Subsidiary of the
         Company; provided that such Liens were in existence prior to the
         contemplation of such acquisition and do not extend to any assets other
         than those of the Person merged into or consolidated with the Company
         or the Restricted Subsidiary;

                  (5) Liens to secure the performance of statutory obligations,
         surety or appeal bonds, performance bonds or other obligations of a
         like nature incurred in the ordinary course of business;

                  (6) Liens to secure Indebtedness (including Capital Lease
         Obligations) permitted by Section 4.09(b)(4) hereof covering only the
         assets acquired with such Indebtedness;

                  (7) Liens existing on the date of this Indenture;

                  (8) Liens for taxes, assessments or governmental charges or
         claims that are not yet delinquent or that are being contested in good
         faith by appropriate proceedings promptly instituted and diligently
         concluded; provided that any reserve or other appropriate provision as
         is required in conformity with GAAP has been made therefor;

                  (9) Liens on assets of Unrestricted Subsidiaries that secure
         Non-Recourse Debt of Unrestricted Subsidiaries;

                  (10) Liens securing Hedging Obligations;

                  (11) other Liens securing obligations incurred in the ordinary
         course of business, which obligations do not exceed $5.0 million in the
         aggregate at any one time outstanding;

                  (12) judgment Liens not giving rise to an Event of Default;

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

                  (14) Liens incurred or deposits made in the ordinary course of
         business in connection with workers' compensation, unemployment
         insurance and other types of social security, including any Lien
         securing letters of credit issued in the ordinary course of business
         consistent with past practice in connection therewith, or to secure the
         performance of tenders, statutory obligations, surety and appeal bonds,
         bids, leases, governmental contracts, performance and return-of-money
         bonds and other similar obligations (exclusive of obligations for the
         payment of borrowed money);

                                       15
<PAGE>

                  (15) Liens imposed by law, such as carriers', landlords',
         warehouseman's and mechanics' Liens, in each case, for sums not yet due
         or being contested in good faith through diligent proceedings;

                  (16) Liens securing Indebtedness of a Restricted Subsidiary of
         the Company owing solely to the Company or any Guarantor to the extent
         such Indebtedness is permitted to be incurred in accordance with
         Section 4.09 hereof;

                  (17) Liens on specific items of inventory or other goods and
         proceeds of any Person securing such Person's obligations with respect
         of bankers' acceptances issued or created for the account of such
         Person to facilitate the purchase, shipment or storage of such
         inventory or other goods;

                  (18) Liens arising from Uniform Commercial Code financing
         statement filings regarding operating leases entered into by the
         Company and its Restricted Subsidiaries in the ordinary course of
         business;

                  (19) minor survey exceptions, minor encumbrances, easements or
         reservations of, or rights of others for, licenses, rights-of-way,
         sewers, electric lines, telegraph and telephone lines and other similar
         purposes, or zoning, building or other restrictions or any similar
         laws, ordinances, orders, rules or regulations as to the use of real
         properties or Liens incidental to the conduct of the business of such
         Person or to the ownership of its properties that do not in the
         aggregate materially adversely affect the value of said properties or
         materially impair their use in the operation of the business of such
         Person;

                  (20) licenses, leases and subleases entered into in the
         ordinary course of business and consistent with past practice; and

                  (21) Liens securing reimbursement obligations with respect to
         letters of credit that encumber documents and other property relating
         to such letters of credit and the products and proceeds thereof.

         "Permitted Refinancing Indebtedness" means any Indebtedness of the
Company or any Guarantor, or any Permitted Debt of any Restricted Subsidiary of
the Company that is not a Guarantor, issued in exchange for, or the net proceeds
of which are used to extend, refinance, renew, replace, defease or refund other
Indebtedness of the Company or any Guarantor, or any Permitted Debt of any such
Restricted Subsidiary (in each case, other than intercompany Indebtedness);
provided that:

                  (1) the principal amount (or accreted value, if applicable) of
         such Permitted Refinancing Indebtedness does not exceed the principal
         amount (or accreted value, if applicable) of the Indebtedness extended,
         refinanced, renewed, replaced, defeased or refunded (plus all accrued
         interest on the Indebtedness and the amount of all expenses and
         premiums incurred in connection therewith);

                  (2) such Permitted Refinancing Indebtedness has a final
         maturity date later than the final maturity date of, and has a Weighted
         Average Life to Maturity equal to or greater than the Weighted Average
         Life to Maturity of, the Indebtedness being extended, refinanced,
         renewed, replaced, defeased or refunded;

                  (3) if the Indebtedness being extended, refinanced, renewed,
         replaced, defeased or refunded is subordinated in right of payment to
         the Notes, such Permitted Refinancing

                                       16
<PAGE>

         Indebtedness has a final maturity date later than the final maturity
         date of, and is subordinated in right of payment to, the Notes on terms
         at least as favorable to the Holders of Notes as those contained in the
         documentation governing the Indebtedness being extended, refinanced,
         renewed, replaced, defeased or refunded; and

                  (4) such Indebtedness is incurred either by the Company, the
         Guarantor or by the Restricted Subsidiary that is not a Guarantor who
         is the obligor on the Indebtedness being extended, refinanced, renewed,
         replaced, defeased or refunded.

         "Person" means any individual, corporation, partnership, joint venture,
association, joint-stock company, trust, unincorporated organization, limited
liability company or government or other entity.

         "Private Placement Legend" means the legend set forth in Section
2.06(g)(1) to be placed on all Notes issued under this Indenture except where
otherwise permitted by the provisions of this Indenture.

         "Productive Assets" means:

                  (1) long-term assets that are used or useful in a Permitted
         Business or

                  (2) a majority of the Voting Stock of any Person engaged in a
         Permitted Business that becomes a Restricted Subsidiary.

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

         "Qualified Equity Offering" means an offering by the Company or the
Parent of shares of its common stock (however designated and whether voting or
non-voting) and any and all rights, warrants on options to acquire such common
stock, whether registered or exempt from registration under the Securities Act;
provided, however, that, in connection with a Qualified Equity Offering of the
Parent, the Company will only be able to redeem Notes as set forth in Section
3.07(a) hereof to the extent the net proceeds of such Qualified Equity Offering
are contributed to the Company as common equity.

         "Registration Rights Agreement" means the Registration Rights
Agreement, dated as of May 22, 2002, between the Company and the other parties
named on the signature pages thereof, as such agreement may be amended, modified
or supplemented from time to time and, with respect to any Additional Notes, one
or more registration rights agreements among the Company, the Guarantors, if
any, and the other parties thereto, as such agreement(s) may be amended,
modified or supplemented from time to time, relating to rights given by the
Company to the purchasers of Additional Notes to register such Additional Notes
under the Securities Act.

         "Regulation S" means Regulation S promulgated under the Securities Act.

         "Regulation S Global Note" means a Global Note bearing the Private
Placement Legend and deposited with or on behalf of the Depositary and
registered in the name of the Depositary or its nominee, issued in a
denomination equal to the outstanding principal amount of the Notes initially
sold in reliance on Rule 903 of Regulation S.

         "Responsible Officer," when used with respect to the Trustee, means any
officer within the Corporate Trust Administration of the Trustee (or any
successor group of the Trustee) or any other officer of the Trustee customarily
performing functions similar to those performed by any of the above designated
officers 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.

                                       17
<PAGE>

         "Restricted Definitive Note" means a Definitive Note bearing the
Private Placement Legend.

         "Restricted Global Note" means a Global Note bearing the Private
Placement Legend.

         "Restricted Investment" means an Investment other than a Permitted
Investment.

         "Restricted Period" means the 40-day distribution compliance period as
defined in Regulation S.

         "Restricted Subsidiary" of a Person means any Subsidiary of the
referent Person that is not an Unrestricted Subsidiary.

         "Rule 144" means Rule 144 promulgated under the Securities Act.

         "Rule 144A" means Rule 144A promulgated under the Securities Act.

         "Rule 903" means Rule 903 promulgated under the Securities Act.

         "Rule 904" means Rule 904 promulgated the Securities Act.

         "SEC" means the Securities and Exchange Commission.

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

         "Senior Credit Facility" means that certain Credit Agreement, dated as
of November 15, 1996, as amended, by and among Cole Vision Corporation, Things
Remembered, Inc., Cole Gift Centers, Inc., Pearle, Inc. and Pearle Service
Corporation, as borrowers, Canadian Imperial Bank of Commerce, as administrative
agent, and the several banks and other financial institutions party thereto,
providing for up to $75.0 million of revolving credit borrowings and other
extensions of credit, including any related notes, guarantees, collateral
documents, instruments and agreements executed in connection therewith, and in
each case as amended, modified, increased, renewed, refunded, replaced or
refinanced from time to time.

         "Senior Debt" means:

                  (1) all Indebtedness of the Company or any Subsidiary
         outstanding under the Senior Credit Facility and all Hedging
         Obligations of the Company or any Subsidiary;

                  (2) any other Indebtedness of the Company or any Guarantor
         permitted to be incurred under the terms of this Indenture, unless the
         instrument under which such Indebtedness is incurred expressly provides
         that it is subordinated to any Senior Debt or on a parity with or
         subordinated in right of payment to the Notes or any Note Guarantee;
         and

                  (3) all Obligations with respect to the items listed in the
         preceding clauses (1) and (2).

         Notwithstanding anything to the contrary in the preceding, Senior Debt
will not include:

                  (1) any liability for federal, state, local or other taxes
         owed or owing by the Company;

                  (2) any intercompany Indebtedness of the Company or any of its
         Subsidiaries to the Company, any of its Subsidiaries or any of its
         Affiliates (other than the Parent);

                  (3) any trade payables; or

                                       18
<PAGE>

                  (4) the portion of any Indebtedness (other than that under the
         Senior Credit Facility described in clause (1) above) that is incurred
         in violation of this Indenture.

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

         "Significant Subsidiary" means any Subsidiary that would be a
"significant subsidiary" as defined in Article 1, Rule 1-02 of Regulation S-X,
promulgated pursuant to the Securities Act, as such Regulation is in effect on
the date of this Indenture.

         "Stated Maturity" means, with respect to any installment of interest or
principal on any series of Indebtedness, the date on which the payment of
interest or principal was scheduled to be paid in the original documentation
governing such Indebtedness, and will not include any contingent obligations to
repay, redeem or repurchase any such interest or principal prior to the date
originally scheduled for the payment thereof.

         "Subsidiary" means, with respect to any specified Person:

                  (1) any corporation, association or other business entity of
         which more than 50% of the total voting power of shares of Capital
         Stock entitled (without regard to the occurrence of any contingency) to
         vote in the election of directors, managers or trustees of the
         corporation, association or other business entity is at the time owned
         or controlled, directly or indirectly, by that Person or one or more of
         the other Subsidiaries of that Person (or a combination thereof); and

                  (2) any partnership:

                      (a) the sole general partner or the managing general
         partner of which is such Person or a Subsidiary of such Person or

                      (b) the only general partners of which are that Person or
         one or more Subsidiaries of that Person (or any combination thereof).

         "Tax Allocation Agreement" means the Tax Allocation Agreement, dated as
of August 23, 1985, as amended, between the Parent and its subsidiaries,
including the Company, as the same may be amended or extended from time to time;
provided that no such amendment may create greater additional liability of the
Company and its Subsidiaries than existing as of the date of this Indenture
under such agreement.

         "TIA" means the Trust Indenture Act of 1939 (15 U.S.C. ss.ss.
77aaa-77bbbb) as in effect on the date on which this Indenture is qualified
under the TIA.

         "Triggering Default Event" means a Default or Event of Default
described in Sections 6.01(1), (2), (3), (5), (6), (7), (8) or (9) hereof or any
breach or violation of Sections 4.01, 4.02, 4.06, 4.07, 4.08, 4.09, 4.10, 4.11,
4.12, 4.13, 4.15, 4.16, 4.17, 4.18, 4.19 and 4.20 hereof.

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

         "Unrestricted Global Note" means a permanent global Note substantially
in the form of Exhibit A attached hereto that bears the Global Note Legend and
that has the "Schedule of Exchanges of Interests

                                       19
<PAGE>

in the Global Note" attached thereto, and that is deposited with or on behalf of
and registered in the name of the Depositary, representing a series of Notes
that do not bear the Private Placement Legend.

         "Unrestricted Definitive Note" means one or more Definitive Notes that
do not bear and are not required to bear the Private Placement Legend.

         "Unrestricted Subsidiary" means any Subsidiary of the Company that is
designated by the Board of Directors as an Unrestricted Subsidiary pursuant to a
Board Resolution, but only to the extent that such Subsidiary:

                  (1) has no Indebtedness other than Non-Recourse Debt;

                  (2) is not party to any agreement, contract, arrangement or
         understanding with the Company or any Restricted Subsidiary of the
         Company unless the terms of any such agreement, contract, arrangement
         or understanding are no less favorable to the Company or such
         Restricted Subsidiary than those that might be obtained at the time
         from Persons who are not Affiliates of the Company;

                  (3) is a Person with respect to which neither the Company nor
         any of its Restricted Subsidiaries has any direct or indirect
         obligation (a) to subscribe for additional Equity Interests or (b) to
         maintain or preserve such Person's financial condition or to cause such
         Person to achieve any specified levels of operating results;

                  (4) has not guaranteed or otherwise directly or indirectly
         provided credit support for any Indebtedness of the Company or any of
         its Restricted Subsidiaries; and

                  (5) has at least one director on its Board of Directors that
         is not a director or executive officer of the Company or any of its
         Restricted Subsidiaries and has at least one executive officer that is
         not a director or executive officer of the Company or any of its
         Restricted Subsidiaries.

         Any designation of a Subsidiary of the Company as an Unrestricted
Subsidiary will be evidenced to the Trustee by filing with the Trustee a
certified copy of the Board Resolution giving effect to such designation and an
Officers' Certificate certifying that such designation complied with the
preceding conditions and was permitted by Section 4.07 hereof. If, at any time,
any Unrestricted Subsidiary would fail to meet the preceding requirements as an
Unrestricted Subsidiary, it will thereafter cease to be an Unrestricted
Subsidiary for purposes of this Indenture and any Indebtedness of such
Subsidiary will be deemed to be incurred by a Restricted Subsidiary of the
Company as of such date and, if such Indebtedness is not permitted to be
incurred as of such date under Section 4.09 hereof, the Company will be in
default of Section 4.09. The Board of Directors of the Company may at any time
designate any Unrestricted Subsidiary to be a Restricted Subsidiary; provided
that such designation will be deemed to be an incurrence of Indebtedness by a
Restricted Subsidiary of the Company of any outstanding Indebtedness of such
Unrestricted Subsidiary and such designation will only be permitted if (1) such
Indebtedness is permitted under Section 4.09, calculated on a pro forma basis as
if such designation had occurred at the beginning of the four-quarter reference
period; and (2) no Default or Event of Default would be in existence following
such designation. Upon any such designation as a Restricted Subsidiary, such
Subsidiary will become a Guarantor and execute a supplemental indenture if so
required under Section 4.18 hereof.

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

         "Voting Stock" of any Person as of any date means the Capital Stock of
such Person that is at the time entitled to vote in the election of the Board of
Directors of such Person.

                                       20
<PAGE>

         "Weighted Average Life to Maturity" means, when applied to any
Indebtedness at any date, the number of years obtained by dividing:

                  (1) the sum of the products obtained by multiplying (a) the
         amount of each then remaining installment, sinking fund, serial
         maturity or other required payments of principal, including payment at
         final maturity, in respect of the Indebtedness, by (b) the number of
         years (calculated to the nearest one-twelfth) that will elapse between
         such date and the making of such payment; by

                  (2) the then outstanding principal amount of such
         Indebtedness.

         "Wholly-Owned Restricted Subsidiary" of any specified Person means a
Restricted Subsidiary of such Person all of the outstanding Capital Stock or
other ownership interests of which (other than directors' qualifying shares)
will at the time be owned by such Person or by one or more Wholly-Owned
Restricted Subsidiaries of such Person and one or more Wholly-Owned Restricted
Subsidiaries of such Person.

Section 1.02  Other Definitions.

<TABLE>
<CAPTION>

                                                                                                Defined in
        Term                                                                                      Section
        ----                                                                                      -------
<S>                                                                                               <C>
        "Affiliate Transaction".............................................................       4.11
        "Asset Sale Offer"..................................................................       3.09
        "Authentication Order"..............................................................       2.02
        "Authorized Person".................................................................       10.03
        "Change of Control Offer"...........................................................       4.14
        "Change of Control Payment".........................................................       4.14
        "Change of Control Payment Date"....................................................       4.14
        "Covenant Defeasance"...............................................................       8.03
        "DTC"...............................................................................       2.03
        "Event of Default"..................................................................       6.01
        "Excess Proceeds"...................................................................       4.10
        "incur".............................................................................       4.09
        "Initial Blockage Period"...........................................................       10.03
        "Legal Defeasance"..................................................................       8.02
        "Offer Amount"......................................................................       3.09
        "Offer Period"......................................................................       3.09
        "Paying Agent"......................................................................       2.03
        "Payment Blockage Period"...........................................................       10.03
        "Permitted Debt"....................................................................       4.09
        "Purchase Date".....................................................................       3.09
        "Registrar".........................................................................       2.03
        "Restricted Payments"...............................................................       4.07
</TABLE>

Section 1.03  Incorporation by Reference of Trust Indenture Act.

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

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

                                       21
<PAGE>

         "indenture securities" means the Notes;

         "indenture security Holder" means a Holder of a Note;

         "indenture to be qualified" means this Indenture;

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

         "obligor" on the Notes and the Note Guarantees means the Company and
the Guarantors, respectively, and any successor obligor upon the Notes and the
Note Guarantees, respectively.

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

Section 1.04  Rules of Construction.

         Unless the context otherwise requires:

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

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

                  (3) "or" is not exclusive;

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

                  (5) "will" shall be interpreted to express a command;

                  (6) provisions apply to successive events and transactions;
         and

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

                                   ARTICLE 2.
                                    THE NOTES

Section 2.01  Form and Dating.

         (a) General. The Notes and the Trustee's certificate of authentication
will be substantially in the form of Exhibit A hereto. The Notes may have
notations, legends or endorsements required by law, stock exchange rule or
usage. The Company may use "CUSIP" numbers in issuing the Notes. Each Note will
be dated the date of its authentication. The Notes shall be issuable only in
registered form, without coupons, in denominations of $1,000 and integral
multiples thereof except that Notes used to pay Liquidated Damages may be in
other denominations.

         The terms and provisions contained in the Notes will constitute, and
are hereby expressly made, a part of this Indenture and the Company, the
Guarantors (if any) and the Trustee, by their execution and delivery of this
Indenture, expressly agree to such terms and provisions and to be bound thereby.

                                       22
<PAGE>

However, to the extent any provision of any Note conflicts with the express
provisions of this Indenture, the provisions of this Indenture shall govern and
be controlling.

         (b) Global Notes. Notes issued in global form will be substantially in
the form of Exhibit A attached hereto (including the Global Note Legend thereon
and the "Schedule of Exchanges of Interests in the Global Note" attached
thereto). Notes issued in definitive form will be substantially in the form of
Exhibit A attached hereto (but without the Global Note Legend thereon and
without the "Schedule of Exchanges of Interests in the Global Note" attached
thereto). Each Global Note will represent such of the outstanding Notes as will
be specified therein and each shall provide that it represents the aggregate
principal amount of outstanding Notes from time to time endorsed thereon and
that the aggregate principal amount of outstanding Notes represented thereby may
from time to time be reduced or increased, as appropriate, to reflect exchanges
and redemptions. Any endorsement of a Global Note to reflect the amount of any
increase or decrease in the aggregate principal amount of outstanding Notes
represented thereby will be made by the Trustee or the Custodian, at the
direction of the Trustee, in accordance with instructions given by the Holder
thereof as required by Section 2.06 hereof.

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

Section 2.02  Execution and Authentication.

         Two Officers must sign the Notes for the Company by manual or facsimile
signature.

         If an Officer whose signature is on a Note no longer holds that office
at the time a Note is authenticated, the Note will nevertheless be valid.

         A Note will not be valid until authenticated by the manual signature of
the Trustee. The signature will be conclusive evidence that the Note has been
authenticated under this Indenture.

         The Trustee will, upon receipt of a written order of the Company signed
by an Officer (an "Authentication Order"), authenticate Notes for original
issue.

         The Trustee may appoint an authenticating agent acceptable to the
Company to authenticate Notes. An authenticating agent may authenticate Notes
whenever the Trustee may do so. Each reference in this Indenture to
authentication by the Trustee includes authentication by such agent. An
authenticating agent has the same rights as an Agent to deal with Holders or an
Affiliate of the Company.

         All Notes issued under this Indenture shall be treated as a single
class for all purposes under this Indenture.

Section 2.03  Registrar and Paying Agent.

         The Company will maintain an office or agency where Notes may be
presented for registration of transfer or for exchange ("Registrar") and an
office or agency where Notes may be presented for payment ("Paying Agent"). The
Registrar will keep a register of the Notes and of their transfer and exchange.
The Company may appoint one or more co-registrars and one or more additional
paying agents. The term "Registrar" includes any co-registrar and the term
"Paying Agent" includes any additional paying agent. The Company may change any
Paying Agent or Registrar without notice to any Holder. The Company

                                       23
<PAGE>

will notify the Trustee in writing of the name and address of any Agent not a
party to this Indenture. If the Company fails to appoint or maintain another
entity as Registrar or Paying Agent, the Trustee shall act as such. The Company
or any of its Subsidiaries may act as Paying Agent or Registrar.

         The Company initially appoints The Depository Trust Company ("DTC") to
act as Depositary with respect to the Global Notes.

         The Company initially appoints the Trustee to act as the Registrar and
Paying Agent and to act as Custodian with respect to the Global Notes.

Section 2.04  Paying Agent to Hold Money in Trust.

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

Section 2.05  Holder Lists.

         The Trustee will preserve in as current a form as is reasonably
practicable the most recent list available to it of the names and addresses of
all Holders and shall otherwise comply with TIA ss. 312(a). If the Trustee is
not the Registrar, the Company will furnish to the Trustee at least seven
Business Days before each interest payment date and at such other times as the
Trustee may request in writing, a list in such form and as of such date as the
Trustee may reasonably require of the names and addresses of the Holders of
Notes and the Company shall otherwise comply with TIA ss. 312(a).

Section 2.06  Transfer and Exchange.

         (a) Transfer and Exchange of Global Notes. A Global Note may not be
transferred as a whole except by the Depositary to a nominee of the Depositary,
by a nominee of the Depositary to the Depositary or to another nominee of the
Depositary, or by the Depositary or any such nominee to a successor Depositary
or a nominee of such successor Depositary. All Global Notes will be exchanged by
the Company for Definitive Notes if:

                  (1) the Company delivers to the Trustee notice from the
         Depositary that it is unwilling or unable to continue to act as
         Depositary or that it is no longer a clearing agency registered under
         the Exchange Act and, in either case, a successor Depositary is not
         appointed by the Company within 120 days after the date of such notice
         from the Depositary; or

                  (2) the Company in its sole discretion determines that the
         Global Notes (in whole but not in part) should be exchanged for
         Definitive Notes and delivers a written notice to such effect to the
         Trustee.

                                       24
<PAGE>

         Upon the occurrence of either of the preceding events in (1) or (2)
above, Definitive Notes shall be issued in such names as the Depositary shall
instruct the Trustee. Global Notes also may be exchanged or replaced, in whole
or in part, as provided in Sections 2.07 and 2.10 hereof. Every Note
authenticated and delivered in exchange for, or in lieu of, a Global Note or any
portion thereof, pursuant to this Section 2.06 or Section 2.07 or 2.10 hereof,
shall be authenticated and delivered in the form of, and shall be, a Global
Note. A Global Note may not be exchanged for another Note other than as provided
in this Section 2.06(a), however, beneficial interests in a Global Note may be
transferred and exchanged as provided in Section 2.06(b), (c) or (f) hereof.

         (b) Transfer and Exchange of Beneficial Interests in the Global Notes.
The transfer and exchange of beneficial interests in the Global Notes will be
effected through the Depositary, in accordance with the provisions of this
Indenture and the Applicable Procedures. Beneficial interests in the Restricted
Global Notes will be subject to restrictions on transfer comparable to those set
forth herein to the extent required by the Securities Act. Transfers of
beneficial interests in the Global Notes also will require compliance with
either subparagraph (1) or (2) below, as applicable, as well as one or more of
the other following subparagraphs, as applicable:

                  (1) Transfer of Beneficial Interests in the Same Global Note.
         Beneficial interests in any Restricted Global Note may be transferred
         to Persons who take delivery thereof in the form of a beneficial
         interest in the same Restricted Global Note in accordance with the
         transfer restrictions set forth in the Private Placement Legend;
         provided, however, that prior to the expiration of the Restricted
         Period, transfers of beneficial interests in the Regulation S Global
         Note may not be made to a U.S. Person or for the account or benefit of
         a U.S. Person (other than an Initial Purchaser). Beneficial interests
         in any Unrestricted Global Note may be transferred to Persons who take
         delivery thereof in the form of a beneficial interest in an
         Unrestricted Global Note. No written orders or instructions shall be
         required to be delivered to the Registrar to effect the transfers
         described in this Section 2.06(b)(1).

                  (2) All Other Transfers and Exchanges of Beneficial Interests
         in Global Notes. In connection with all transfers and exchanges of
         beneficial interests that are not subject to Section 2.06(b)(1) above,
         the transferor of such beneficial interest must deliver to the
         Registrar either:

                        (A) both:

                              (i) a written order from a Participant or an
                        Indirect Participant given to the Depositary in
                        accordance with the Applicable Procedures directing the
                        Depositary to credit or cause to be credited a
                        beneficial interest in another Global Note in an amount
                        equal to the beneficial interest to be transferred or
                        exchanged; and

                              (ii) instructions given in accordance with the
                        Applicable Procedures containing information regarding
                        the Participant account to be credited with such
                        increase; or

                        (B) both:

                              (i) a written order from a Participant or an
                        Indirect Participant given to the Depositary in
                        accordance with the Applicable Procedures directing the
                        Depositary to cause to be issued a Definitive Note in an
                        amount equal to the beneficial interest to be
                        transferred or exchanged; and

                                       25
<PAGE>

                              (ii) instructions given by the Depositary to the
                        Registrar containing information regarding the Person in
                        whose name such Definitive Note shall be registered to
                        effect the transfer or exchange referred to in (1)
                        above. Upon consummation of an Exchange Offer by the
                        Company in accordance with Section 2.06(f) hereof, the
                        requirements of this Section 2.06(b)(2) shall be deemed
                        to have been satisfied upon receipt by the Registrar of
                        the instructions contained in the Letter of Transmittal
                        delivered by the Holder of such beneficial interests in
                        the Restricted Global Notes. Upon satisfaction of all of
                        the requirements for transfer or exchange of beneficial
                        interests in Global Notes contained in this Indenture
                        and the Notes or otherwise applicable under the
                        Securities Act, the Trustee shall adjust the principal
                        amount of the relevant Global Note(s) pursuant to
                        Section 2.06(h) hereof.

                  (3) Transfer of Beneficial Interests to Another Restricted
         Global Note. A beneficial interest in any Restricted Global Note may be
         transferred to a Person who takes delivery thereof in the form of a
         beneficial interest in another Restricted Global Note if the transfer
         complies with the requirements of Section 2.06(b)(2) above and the
         Registrar receives the following:

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

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

                  (4) Transfer and Exchange of Beneficial Interests in a
         Restricted Global Note for Beneficial Interests in an Unrestricted
         Global Note. A beneficial interest in any Restricted Global Note may be
         exchanged by any holder thereof for a beneficial interest in an
         Unrestricted Global Note or transferred to a Person who takes delivery
         thereof in the form of a beneficial interest in an Unrestricted Global
         Note if the exchange or transfer complies with the requirements of
         Section 2.06(b)(2) above and:

                           (A) such exchange or transfer is effected pursuant to
                  the Exchange Offer in accordance with the Registration Rights
                  Agreement and the holder of the beneficial interest to be
                  transferred, in the case of an exchange, or the transferee, in
                  the case of a transfer, certifies in the applicable Letter of
                  Transmittal or via the Depositary's book-entry system that it
                  is not (i) a Broker-Dealer, (ii) a Person participating in the
                  distribution of the Exchange Notes or (iii) a Person who is an
                  affiliate (as defined in Rule 144) of the Company;

                           (B) such transfer is effected pursuant to the Shelf
                  Registration Statement in accordance with the Registration
                  Rights Agreement;

                           (C) such transfer is effected by a Broker-Dealer
                  pursuant to the Exchange Offer Registration Statement in
                  accordance with the Registration Rights Agreement; or

                           (D) the Registrar receives the following:

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

                                       26
<PAGE>

                           Unrestricted Global Note, a certificate from such
                           holder in the form of Exhibit C hereto, including the
                           certifications in item (1)(a) thereof; or

                                    (ii) if the holder of such beneficial
                           interest in a Restricted Global Note proposes to
                           transfer such beneficial interest to a Person who
                           shall take delivery thereof in the form of a
                           beneficial interest in an Unrestricted Global Note, a
                           certificate from such holder in the form of Exhibit B
                           hereto, including the certifications in item (4)
                           thereof;

                  and, in each such case set forth in this subparagraph (D), if
                  the Registrar so requests or if the Applicable Procedures so
                  require, an Opinion of Counsel in form reasonably acceptable
                  to the Registrar to the effect that such exchange or transfer
                  is in compliance with the Securities Act and that the
                  restrictions on transfer contained herein and in the Private
                  Placement Legend are no longer required in order to maintain
                  compliance with the Securities Act.

         If any such transfer is effected pursuant to subparagraph (B) or (D)
above at a time when an Unrestricted Global Note has not yet been issued, the
Company shall issue and, upon receipt of an Authentication Order in accordance
with Section 2.02 hereof, the Trustee shall authenticate one or more
Unrestricted Global Notes in an aggregate principal amount equal to the
aggregate principal amount of beneficial interests transferred pursuant to
subparagraph (B) or (D) above.

         Beneficial interests in an Unrestricted Global Note cannot be exchanged
for, or transferred to Persons who take delivery thereof in the form of, a
beneficial interest in a Restricted Global Note.

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

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

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

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

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

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

                                       27
<PAGE>

                           (E) if such beneficial interest is being transferred
                  to an Institutional Accredited Investor in reliance on an
                  exemption from the registration requirements of the Securities
                  Act other than those listed in subparagraphs (B) through (D)
                  above, a certificate to the effect set forth in Exhibit B
                  hereto, including the certifications, certificates and Opinion
                  of Counsel required by item (3) thereof, if applicable;

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

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

the Trustee shall cause the aggregate principal amount of the applicable Global
Note to be reduced accordingly pursuant to Section 2.06(h) hereof, and the
Company shall execute and the Trustee shall authenticate and deliver to the
Person designated in the instructions a Definitive Note in the appropriate
principal amount. Any Definitive Note issued in exchange for a beneficial
interest in a Restricted Global Note pursuant to this Section 2.06(c) shall be
registered in such name or names and in such authorized denomination or
denominations as the holder of such beneficial interest shall instruct the
Registrar through instructions from the Depositary and the Participant or
Indirect Participant. The Trustee shall deliver such Definitive Notes to the
Persons in whose names such Notes are so registered. Any Definitive Note issued
in exchange for a beneficial interest in a Restricted Global Note pursuant to
this Section 2.06(c)(1) shall bear the Private Placement Legend and shall be
subject to all restrictions on transfer contained therein.

                  (2) Beneficial Interests in Restricted Global Notes to
         Unrestricted Definitive Notes. A holder of a beneficial interest in a
         Restricted Global Note may exchange such beneficial interest for an
         Unrestricted Definitive Note or may transfer such beneficial interest
         to a Person who takes delivery thereof in the form of an Unrestricted
         Definitive Note only if:

                           (A) such exchange or transfer is effected pursuant to
                  the Exchange Offer in accordance with the Registration Rights
                  Agreement and the holder of such beneficial interest, in the
                  case of an exchange, or the transferee, in the case of a
                  transfer, certifies in the applicable Letter of Transmittal
                  that it is not (i) a Broker-Dealer, (ii) a Person
                  participating in the distribution of the Exchange Notes or
                  (iii) a Person who is an affiliate (as defined in Rule 144) of
                  the Company;

                           (B) such transfer is effected pursuant to the Shelf
                  Registration Statement in accordance with the Registration
                  Rights Agreement;

                           (C) such transfer is effected by a Broker-Dealer
                  pursuant to the Exchange Offer Registration Statement in
                  accordance with the Registration Rights Agreement; or

                           (D) the Registrar receives the following:

                                    (i) if the holder of such beneficial
                           interest in a Restricted Global Note proposes to
                           exchange such beneficial interest for a Definitive
                           Note that does not bear the Private Placement Legend,
                           a certificate from such holder in the form of Exhibit
                           C hereto, including the certifications in item (1)(b)
                           thereof; or

                                       28
<PAGE>

                                    (ii) if the holder of such beneficial
                           interest in a Restricted Global Note proposes to
                           transfer such beneficial interest to a Person who
                           shall take delivery thereof in the form of a
                           Definitive Note that does not bear the Private
                           Placement Legend, a certificate from such holder in
                           the form of Exhibit B hereto, including the
                           certifications in item (4) thereof;

                  and, in each such case set forth in this subparagraph (D), if
                  the Registrar so requests or if the Applicable Procedures so
                  require, an Opinion of Counsel to the effect that such
                  exchange or transfer is in compliance with the Securities Act
                  and that the restrictions on transfer contained herein and in
                  the Private Placement Legend are no longer required in order
                  to maintain compliance with the Securities Act.

                  (3) Beneficial Interests in Unrestricted Global Notes to
         Unrestricted Definitive Notes. If any holder of a beneficial interest
         in an Unrestricted Global Note proposes to exchange such beneficial
         interest for a Definitive Note or to transfer such beneficial interest
         to a Person who takes delivery thereof in the form of a Definitive
         Note, then, upon satisfaction of the conditions set forth in Section
         2.06(b)(2) hereof, the Trustee will cause the aggregate principal
         amount of the applicable Global Note to be reduced accordingly pursuant
         to Section 2.06(h) hereof, and the Company will execute and the Trustee
         will authenticate and deliver to the Person designated in the
         instructions a Definitive Note in the appropriate principal amount. Any
         Definitive Note issued in exchange for a beneficial interest pursuant
         to this Section 2.06(c)(3) will be registered in such name or names and
         in such authorized denomination or denominations as the holder of such
         beneficial interest requests through instructions to the Registrar from
         or through the Depositary and the Participant or Indirect Participant.
         The Trustee will deliver such Definitive Notes to the Persons in whose
         names such Notes are so registered. Any Definitive Note issued in
         exchange for a beneficial interest pursuant to this Section 2.06(c)(3)
         will not bear the Private Placement Legend.

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

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

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

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

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

                           (D) if such Restricted Definitive Note is being
                  transferred pursuant to an exemption from the registration
                  requirements of the Securities Act in accordance with

<PAGE>
                  Rule 144, a certificate to the effect set forth in Exhibit B
                  hereto, including the certifications in item (3)(a) thereof;

                           (E) if such Restricted Definitive Note is being
                  transferred to an Institutional Accredited Investor in
                  reliance on an exemption from the registration requirements of
                  the Securities Act other than those listed in subparagraphs
                  (B) through (D) above, a certificate to the effect set forth
                  in Exhibit B hereto, including the certifications,
                  certificates and Opinion of Counsel required by item (3)
                  thereof, if applicable;

                           (F) if such Restricted Definitive Note is being
                  transferred to the Company or any of its Subsidiaries, a
                  certificate to the effect set forth in Exhibit B hereto,
                  including the certifications in item (3)(b) thereof; or

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

                  the Trustee will cancel the Restricted Definitive Note and
                  increase or cause to be increased the aggregate principal
                  amount of the appropriate Restricted Global Note.

                  (2) Restricted Definitive Notes to Beneficial Interests in
         Unrestricted Global Notes. A Holder of a Restricted Definitive Note may
         exchange such Note for a beneficial interest in an Unrestricted Global
         Note or transfer such Restricted Definitive Note to a Person who takes
         delivery thereof in the form of a beneficial interest in an
         Unrestricted Global Note only if:

                           (A) such exchange or transfer is effected pursuant to
                  the Exchange Offer in accordance with the Registration Rights
                  Agreement and the Holder, in the case of an exchange, or the
                  transferee, in the case of a transfer, certifies in the
                  applicable Letter of Transmittal that it is not (i) a
                  Broker-Dealer, (ii) a Person participating in the distribution
                  of the Exchange Notes or (iii) a Person who is an affiliate
                  (as defined in Rule 144) of the Company;

                           (B) such transfer is effected pursuant to the Shelf
                  Registration Statement in accordance with the Registration
                  Rights Agreement;

                           (C) such transfer is effected by a Broker-Dealer
                  pursuant to the Exchange Offer Registration Statement in
                  accordance with the Registration Rights Agreement; or

                           (D) the Registrar receives the following:

                                    (i) if the Holder of such Definitive Notes
                           proposes to exchange such Notes for a beneficial
                           interest in the Unrestricted Global Note, a
                           certificate from such Holder in the form of Exhibit C
                           hereto, including the certifications in item (1)(c)
                           thereof; or

                                    (ii) if the Holder of such Definitive Notes
                           proposes to transfer such Notes to a Person who shall
                           take delivery thereof in the form of a beneficial
                           interest in the Unrestricted Global Note, a
                           certificate from such Holder in the form of Exhibit B
                           hereto, including the certifications in item (4)
                           thereof;

                                       30
<PAGE>

                  and, in each such case set forth in this subparagraph (D), if
                  the Registrar so requests or if the Applicable Procedures so
                  require, an Opinion of Counsel in form reasonably acceptable
                  to the Registrar to the effect that such exchange or transfer
                  is in compliance with the Securities Act and that the
                  restrictions on transfer contained herein and in the Private
                  Placement Legend are no longer required in order to maintain
                  compliance with the Securities Act.

                  Upon satisfaction of the conditions of any of the
         subparagraphs in this Section 2.06(d)(2), the Trustee will cancel the
         Definitive Notes and increase or cause to be increased the aggregate
         principal amount of the Unrestricted Global Note.

                  (3) Unrestricted Definitive Notes to Beneficial Interests in
         Unrestricted Global Notes. A Holder of an Unrestricted Definitive Note
         may exchange such Note for a beneficial interest in an Unrestricted
         Global Note or transfer such Definitive Notes to a Person who takes
         delivery thereof in the form of a beneficial interest in an
         Unrestricted Global Note at any time. Upon receipt of a request for
         such an exchange or transfer, the Trustee will cancel the applicable
         Unrestricted Definitive Note and increase or cause to be increased the
         aggregate principal amount of one of the Unrestricted Global Notes.

                  If any such exchange or transfer from a Definitive Note to a
         beneficial interest is effected pursuant to subparagraphs (2)(B),
         (2)(D) or (3) above at a time when an Unrestricted Global Note has not
         yet been issued, the Company will issue and, upon receipt of an
         Authentication Order in accordance with Section 2.02 hereof, the
         Trustee will authenticate one or more Unrestricted Global Notes in an
         aggregate principal amount equal to the principal amount of Definitive
         Notes so transferred.

         (e) Transfer and Exchange of Definitive Notes for Definitive Notes.
Upon request by a Holder of Definitive Notes and such Holder's compliance with
the provisions of this Section 2.06(e), the Registrar will register the transfer
or exchange of Definitive Notes. Prior to such registration of transfer or
exchange, the requesting Holder must present or surrender to the Registrar the
Definitive Notes duly endorsed or accompanied by a written instruction of
transfer in form satisfactory to the Registrar duly executed by such Holder or
by its attorney, duly authorized in writing. In addition, the requesting Holder
must provide any additional certifications, documents and information, as
applicable, required pursuant to the following provisions of this Section
2.06(e).

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

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

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

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

                                       31
<PAGE>

                  (2) Restricted Definitive Notes to Unrestricted Definitive
         Notes. Any Restricted Definitive Note may be exchanged by the Holder
         thereof for an Unrestricted Definitive Note or transferred to a Person
         or Persons who take delivery thereof in the form of an Unrestricted
         Definitive Note if:

                           (A) such exchange or transfer is effected pursuant to
                  the Exchange Offer in accordance with the Registration Rights
                  Agreement and the Holder, in the case of an exchange, or the
                  transferee, in the case of a transfer, certifies in the
                  applicable Letter of Transmittal that it is not (i) a
                  broker-dealer, (ii) a Person participating in the distribution
                  of the Exchange Notes or (iii) a Person who is an affiliate
                  (as defined in Rule 144) of the Company;

                           (B) any such transfer is effected pursuant to the
                  Shelf Registration Statement in accordance with the
                  Registration Rights Agreement;

                           (C) any such transfer is effected by a Broker-Dealer
                  pursuant to the Exchange Offer Registration Statement in
                  accordance with the Registration Rights Agreement; or

                           (D) the Registrar receives the following:

                                    (i) if the Holder of such Restricted
                           Definitive Notes proposes to exchange such Notes for
                           an Unrestricted Definitive Note, a certificate from
                           such Holder in the form of Exhibit C hereto,
                           including the certifications in item (1)(d) thereof;
                           or

                                    (ii) if the Holder of such Restricted
                           Definitive Notes proposes to transfer such Notes to a
                           Person who shall take delivery thereof in the form of
                           an Unrestricted Definitive Note, a certificate from
                           such Holder in the form of Exhibit B hereto,
                           including the certifications in item (4) thereof;

                  and, in each such case set forth in this subparagraph (D), if
                  the Registrar so requests, an Opinion of Counsel in form
                  reasonably acceptable to the Company to the effect that such
                  exchange or transfer is in compliance with the Securities Act
                  and that the restrictions on transfer contained herein and in
                  the Private Placement Legend are no longer required in order
                  to maintain compliance with the Securities Act.

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

         (f) Exchange Offer. Upon the occurrence of the Exchange Offer in
accordance with the Registration Rights Agreement, the Company will issue and,
upon receipt of an Authentication Order in accordance with Section 2.02 hereof,
the Trustee will authenticate:

                  (1) one or more Unrestricted Global Notes in an aggregate
         principal amount equal to the principal amount of the beneficial
         interests in the Restricted Global Notes tendered into the Exchange
         Offer by Persons that certify in the applicable Letters of Transmittal
         that (A) they are not Broker-Dealers, (B) they are not participating in
         a distribution of the Exchange Notes and (z) they are not affiliates
         (as defined in Rule 144) of the Company; and

                                       32
<PAGE>

                  (2) Unrestricted Definitive Notes in an aggregate principal
         amount equal to the principal amount of the Restricted Definitive Notes
         accepted for exchange in the Exchange Offer.

         Concurrently with the issuance of such Notes, the Trustee will cause
the aggregate principal amount of the applicable Restricted Global Notes to be
reduced accordingly, and the Company will execute and the Trustee will
authenticate and deliver to the Persons designated by the Holders of Definitive
Notes so accepted Unrestricted Definitive Notes in the appropriate principal
amount.

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

            (1) Private Placement Legend.

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

"THE NOTES EVIDENCED HEREBY HAVE NOT BEEN REGISTERED UNDER THE UNITED STATES
SECURITIES ACT OF 1933 (THE "SECURITIES ACT") AND MAY NOT BE OFFERED, SOLD,
PLEDGED OR OTHERWISE TRANSFERRED EXCEPT (A)(1) TO A PERSON WHOM THE SELLER
REASONABLY BELIEVES IS A QUALIFIED INSTITUTIONAL BUYER WITHIN THE MEANING OF
RULE 144A UNDER THE SECURITIES ACT PURCHASING FOR ITS OWN ACCOUNT OR FOR THE
ACCOUNT OF A QUALIFIED INSTITUTIONAL BUYER IN A TRANSACTION MEETING THE
REQUIREMENTS OF RULE 144A, (2) IN AN OFFSHORE TRANSACTION COMPLYING WITH RULE
903 OR RULE 904 OF REGULATION S UNDER THE SECURITIES ACT, (3) PURSUANT TO AN
EXEMPTION FROM REGISTRATION UNDER THE SECURITIES ACT PROVIDED BY RULE 144
THEREUNDER (IF AVAILABLE), (4) TO AN INSTITUTIONAL ACCREDITED INVESTOR IN A
TRANSACTION EXEMPT FROM THE REGISTRATION REQUIREMENTS OF THE SECURITIES ACT OR
(5) PURSUANT TO AN EFFECTIVE REGISTRATION STATEMENT UNDER THE SECURITIES ACT AND
(B) IN ACCORDANCE WITH ALL APPLICABLE SECURITIES LAWS OF THE STATES OF THE
UNITED STATES."

                  (B) Notwithstanding the foregoing, any Global Note or
            Definitive Note issued pursuant to subparagraphs (b)(4), (c)(2),
            (c)(3), (d)(2), (d)(3), (e)(2), (e)(3) or (f) of this Section 2.06
            (and all Notes issued in exchange therefor or substitution thereof)
            will not bear the Private Placement Legend.

            (2) Global Note Legend. Each Global Note will bear a legend in
      substantially the following form:

"THIS GLOBAL NOTE IS HELD BY THE DEPOSITARY (AS DEFINED IN THE INDENTURE
GOVERNING THIS NOTE) OR ITS NOMINEE IN CUSTODY FOR THE BENEFIT OF THE BENEFICIAL
OWNERS HEREOF, AND IS NOT TRANSFERABLE TO ANY PERSON UNDER ANY CIRCUMSTANCES
EXCEPT THAT (1) THE TRUSTEE MAY MAKE SUCH NOTATIONS HEREON AS MAY BE REQUIRED
PURSUANT TO SECTION 2.06 OF THE INDENTURE, (2) THIS GLOBAL NOTE MAY BE EXCHANGED
IN WHOLE BUT NOT IN PART PURSUANT TO SECTION 2.06(a) OF THE INDENTURE, (3) THIS
GLOBAL NOTE MAY BE DELIVERED TO THE TRUSTEE FOR CANCELLATION PURSUANT TO SECTION
2.11 OF THE INDENTURE AND (IV)

                                       33
<PAGE>

THIS GLOBAL NOTE MAY BE TRANSFERRED TO A SUCCESSOR DEPOSITARY WITH THE PRIOR
WRITTEN CONSENT OF COLE NATIONAL GROUP, INC.

UNLESS AND UNTIL IT IS EXCHANGED IN WHOLE OR IN PART FOR NOTES IN DEFINITIVE
FORM, THIS NOTE MAY NOT BE TRANSFERRED EXCEPT AS A WHOLE BY THE DEPOSITARY TO A
NOMINEE OF THE DEPOSITARY OR BY A NOMINEE OF THE DEPOSITARY TO THE DEPOSITARY
OR ANOTHER NOMINEE OF THE DEPOSITARY OR BY THE DEPOSITARY OR ANY SUCH NOMINEE
TO A SUCCESSOR DEPOSITARY OR A NOMINEE OF SUCH SUCCESSOR DEPOSITARY. UNLESS
THIS CERTIFICATE IS PRESENTED BY AN AUTHORIZED REPRESENTATIVE OF THE DEPOSITORY
TRUST COMPANY (55 WATER STREET, NEW YORK, NEW YORK) ("DTC"), TO THE COMPANY OR
ITS AGENT FOR REGISTRATION OF TRANSFER, EXCHANGE OR PAYMENT, AND ANY
CERTIFICATE ISSUED IS REGISTERED IN THE NAME OF CEDE & CO. OR SUCH OTHER NAME
AS MAY BE REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF DTC (AND ANY PAYMENT IS
MADE TO CEDE & CO. OR SUCH OTHER ENTITY AS MAY BE REQUESTED BY AN AUTHORIZED
REPRESENTATIVE OF DTC), ANY TRANSFER, PLEDGE OR OTHER USE HEREOF FOR VALUE OR
OTHERWISE BY OR TO ANY PERSON IS WRONGFUL INASMUCH AS THE REGISTERED OWNER
HEREOF, CEDE & CO., HAS AN INTEREST HEREIN."

         (h) Cancellation and/or Adjustment of Global Notes. At such time as all
beneficial interests in a particular Global Note have been exchanged for
Definitive Notes or a particular Global Note has been redeemed, repurchased or
canceled in whole and not in part, each such Global Note will be returned to or
retained and canceled by the Trustee in accordance with Section 2.11 hereof. At
any time prior to such cancellation, if any beneficial interest in a Global Note
is exchanged for or transferred to a Person who will take delivery thereof in
the form of a beneficial interest in another Global Note or for Definitive
Notes, the principal amount of Notes represented by such Global Note will be
reduced accordingly and an endorsement will be made on such Global Note by the
Trustee or by the Depositary at the direction of the Trustee to reflect such
reduction; and if the beneficial interest is being exchanged for or transferred
to a Person who will take delivery thereof in the form of a beneficial interest
in another Global Note, such other Global Note will be increased accordingly and
an endorsement will be made on such Global Note by the Trustee or by the
Depositary at the direction of the Trustee to reflect such increase.

         (i) General Provisions Relating to Transfers and Exchanges.

                  (1) To permit registrations of transfers and exchanges, the
         Company will execute and the Trustee will authenticate Global Notes and
         Definitive Notes upon receipt of an Authentication Order in accordance
         with Section 2.02 or at the Registrar's request.

                  (2) No service charge will be made to a Holder of a Global
         Note or to a Holder of a Definitive Note for any registration of
         transfer or exchange, but the Company may require payment of a sum
         sufficient to cover any transfer tax or similar governmental charge
         payable in connection therewith (other than any such transfer taxes or
         similar governmental charge payable upon exchange or transfer pursuant
         to Sections 2.10, 3.06, 3.09, 4.10, 4.14 and 9.05 hereof).

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

                  (4) All Global Notes and Definitive Notes issued upon any
         registration of transfer or exchange of Global Notes or Definitive
         Notes will be the valid obligations of the Company,

                                       34
<PAGE>

         evidencing the same debt, and entitled to the same benefits under this
         Indenture, as the Global Notes or Definitive Notes surrendered upon
         such registration of transfer or exchange.

                  (5) The Company will not be required:

                           (A) to issue, to register the transfer of or to
                  exchange any Notes during a period beginning at the opening of
                  business 15 days before the day of any selection of Notes for
                  redemption under Section 3.02 hereof and ending at the close
                  of business on the day of selection;

                           (B) to register the transfer of or to exchange any
                  Note selected for redemption in whole or in part, except the
                  unredeemed portion of any Note being redeemed in part; or

                           (C) to register the transfer of or to exchange a Note
                  between a record date and the next succeeding interest payment
                  date.

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

                  (7) The Trustee will authenticate Global Notes and Definitive
         Notes in accordance with the provisions of Section 2.02 hereof.

                  (8) All certifications, certificates and Opinions of Counsel
         required to be submitted to the Registrar pursuant to this Section 2.06
         to effect a registration of transfer or exchange may be submitted by
         facsimile.

Section 2.07  Replacement Notes.

         If any mutilated Note is surrendered to the Trustee or the Company and
the Trustee receives evidence to its satisfaction of the destruction, loss or
theft of any Note, the Company will issue and the Trustee, upon receipt of an
Authentication Order, will authenticate a replacement Note if the Trustee's
requirements are met. If required by the Trustee or the Company, an indemnity
bond must be supplied by the Holder that is sufficient in the judgment of the
Trustee and the Company to protect the Company, the Trustee, any Agent and any
authenticating agent from any loss that any of them may suffer if a Note is
replaced. The Company may charge for its expenses in replacing a Note.

         Every replacement Note is an additional obligation of the Company and
will be entitled to all of the benefits of this Indenture equally and
proportionately with all other Notes duly issued hereunder.

Section 2.08  Outstanding Notes.

         The Notes outstanding at any time are all the Notes authenticated by
the Trustee except for those canceled by it, those delivered to it for
cancellation, those reductions in the interest in a Global Note effected by the
Trustee in accordance with the provisions hereof, and those described in this
Section as not outstanding. However, Notes held by the Company or a Subsidiary
of the Company shall not be deemed to be outstanding for purposes of Section
3.07(a) hereof. Except as set forth in Section 2.09 hereof, a Note does not
cease to be outstanding because the Company or an Affiliate of the Company holds
the Note.

                                       35
<PAGE>

         If a Note is replaced pursuant to Section 2.07 hereof, it ceases to be
outstanding unless the Trustee receives proof satisfactory to it that the
replaced Note is held by a bona fide purchaser or a protected purchaser.

         If the principal amount of any Note is considered paid under Section
4.01 hereof, it ceases to be outstanding and interest on it ceases to accrue.

         If the Paying Agent (other than the Company, a Subsidiary or an
Affiliate of any thereof) holds, on a redemption date or maturity date, money
sufficient to pay all of the principal, premium, if any, and interest and
Liquidated Damages, if any on the Notes payable on that date, then on and after
that date such Notes will cease to be outstanding and will cease to accrue
interest.

Section 2.09  Treasury Notes.

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

Section 2.10  Temporary Notes.

         Until certificates representing Notes are ready for delivery, the
Company may prepare and the Trustee, upon receipt of an Authentication Order,
will authenticate temporary Notes. Temporary Notes will be substantially in the
form of certificated Notes but may have variations that the Company considers
appropriate for temporary Notes and as may be reasonably acceptable to the
Trustee. Without unreasonable delay, the Company will prepare and the Trustee
will authenticate definitive Notes in exchange for temporary Notes.

         Holders of temporary Notes will be entitled to all of the benefits of
this Indenture.

Section 2.11   Cancellation.

         The Company at any time may deliver Notes to the Trustee for
cancellation. The Registrar and Paying Agent will forward to the Trustee any
Notes surrendered to them for registration of transfer, exchange or payment. The
Trustee and no one else will cancel all Notes surrendered for registration of
transfer, exchange, payment, replacement or cancellation and will destroy
canceled Notes (subject to the record retention requirement of the Exchange
Act). Certification of the destruction of all canceled Notes will be delivered
to the Company. The Company may not issue new Notes to replace Notes that it has
paid or that have been delivered to the Trustee for cancellation. If the Company
or any Guarantor shall acquire any of the Notes, such acquisition shall not
operate as a redemption or satisfaction of the Indebtedness represented by such
Notes unless and until the Notes are surrendered to the Trustee for cancellation
pursuant to this Section 2.11.

Section 2.12      Defaulted Interest.

         If the Company defaults in a payment of interest on the Notes, it will
pay the defaulted interest in any lawful manner plus, to the extent lawful,
interest payable on the defaulted interest, to the Persons who are Holders on a
subsequent special record date, in each case at the rate provided in the Notes
and in Section 4.01 hereof. The Company will notify the Trustee in writing of
the amount of defaulted interest

                                       36
<PAGE>

proposed to be paid on each Note and the date of the proposed payment. The
Company will fix or cause to be fixed each such special record date and payment
date; provided that no such special record date may be less than 10 days prior
to the related payment date for such defaulted interest. At least 15 days before
the special record date, the Company (or, upon the written request of the
Company, the Trustee in the name and at the expense of the Company) will mail or
cause to be mailed to Holders a notice that states the special record date, the
related payment date and the amount of such interest to be paid.

                                   ARTICLE 3.
                           REDEMPTION AND PREPAYMENT

Section 3.01  Notices to Trustee.

         If the Company elects to redeem Notes pursuant to the optional
redemption provisions of Section 3.07 hereof, it must furnish to the Trustee, at
least 30 days but not more than 60 days before a redemption date, an Officers'
Certificate setting forth:

                  (1) the clause of this Indenture pursuant to which the
         redemption shall occur;

                  (2) the redemption date;

                  (3) the principal amount of Notes to be redeemed; and

                  (4) the redemption price.

Section 3.02  Selection of Notes to Be Redeemed or Purchased.

         If less than all of the Notes are to be redeemed or purchased in an
offer to purchase at any time, the Trustee will select Notes for redemption or
purchase as follows:

                  (1) if the Notes are listed on any national securities
         exchange, in compliance with the requirements of the principal national
         securities exchange on which the Notes are listed; or

                  (2) if the Notes are not listed on any national securities
         exchange, on a pro rata basis, by lot or by such method as the Trustee
         shall deem fair and appropriate.

         In the event of partial redemption or purchase by lot, the particular
Notes to be redeemed or purchased will be selected, unless otherwise provided
herein, not less than 30 nor more than 60 days prior to the redemption or
purchase date by the Trustee from the outstanding Notes not previously called
for redemption or purchase.

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

Section 3.03   Notice of Redemption.

                                       37
<PAGE>

         Subject to the provisions of Section 3.09 hereof, at least 30 days but
not more than 60 days before a redemption date, the Company will mail or cause
to be mailed, by first class mail, a notice of redemption to each Holder whose
Notes are to be redeemed at its registered address, except that redemption
notices may be mailed more than 60 days prior to a redemption date if the notice
is issued in connection with a defeasance of the Notes or a satisfaction and
discharge of this Indenture pursuant to Articles 8 or 12 of this Indenture.

         The notice will identify the Notes to be redeemed and will state:

                  (1) the redemption date;

                  (2) the redemption price;

                  (3) if any Note is being redeemed in part, the portion of the
         principal amount of such Note to be redeemed and that, after the
         redemption date upon surrender of such Note, a new Note or Notes in
         principal amount equal to the unredeemed portion will be issued upon
         cancellation of the original Note;

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

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

                  (6) that, unless the Company defaults in making such
         redemption payment, interest on Notes called for redemption ceases to
         accrue on and after the redemption date;

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

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

         At the Company's request, the Trustee will give the notice of
redemption in the Company's name and at its expense; provided, however, that the
Company has delivered to the Trustee, at least 45 days prior to the redemption
date, an Officers' Certificate requesting that the Trustee give such notice and
setting forth the information to be stated in such notice as provided in the
preceding paragraph.

Section 3.04  Effect of Notice of Redemption.

         Once notice of redemption is mailed in accordance with Section 3.03
hereof, Notes called for redemption become due and payable on the redemption
date at the redemption price. A notice of redemption may not be conditional.

Section 3.05  Deposit of Redemption or Purchase Price.

         One Business Day prior to the redemption or purchase price date, the
Company will deposit with the Trustee or with the Paying Agent money sufficient
to pay the redemption or purchase price of and accrued interest and Liquidated
Damages, if any, on all Notes to be redeemed or purchased on that date. The
Trustee or the Paying Agent will promptly return to the Company any money
deposited with the Trustee or the Paying Agent by the Company in excess of the
amounts necessary to pay the redemption or

                                       38
<PAGE>

purchase price of, and accrued interest and Liquidated Damages, if any, on, all
Notes to be redeemed or purchased.

         If the Company complies with the provisions of the preceding paragraph,
on and after the redemption or purchase date, interest will cease to accrue on
the Notes or the portions of Notes called for redemption or purchase, whether or
not such Notes are presented for payment. If a Note is redeemed or purchased on
or after an interest record date but on or prior to the related interest payment
date, then any accrued and unpaid interest shall be paid to the Person in whose
name such Note was registered at the close of business on such record date. If
any Note called for redemption or purchase is not so paid upon surrender for
redemption or purchase because of the failure of the Company to comply with the
preceding paragraph, interest shall be paid on the unpaid principal, from the
redemption or purchase date until such principal is paid, and to the extent
lawful on any interest not paid on such unpaid principal, in each case at the
rate provided in the Notes and in Section 4.01 hereof.

Section 3.06  Notes Redeemed or Purchased in Part.

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

Section 3.07  Optional Redemption.

         (a) At any time prior to May 15, 2005, the Company may on any one or
more occasions redeem up to 40% of the aggregate principal amount of Notes
issued under this Indenture at a redemption price of 108.875% of the principal
amount thereof, plus accrued and unpaid interest and Liquidated Damages, if any,
to the redemption date, with the net cash proceeds of one or more Qualified
Equity Offering; provided that:

                  (1) at least 60% of the aggregate principal amount of Notes
         issued under this Indenture remains outstanding immediately after the
         occurrence of such redemption (excluding Notes held by the Company and
         its Subsidiaries); and

                  (2) the redemption occurs within 60 days of the date of the
         closing of such Qualified Equity Offering.

         (b) Except pursuant to the preceding paragraph, the Notes are not
redeemable at the Company's option prior to May 15, 2007.

         (c) After May 15, 2007, the Company may redeem all or, from time to
time, a part of the Notes upon not less than 30 nor more than 60 days' notice,
at the redemption prices (expressed as percentages of principal amount) set
forth below plus accrued and unpaid interest and Liquidated Damages, if any,
thereon, to the applicable redemption date, if redeemed during the twelve-month
period beginning on May 15 of the years indicated below:

               YEAR                                                PERCENTAGE
               ----                                                ----------
               2007.......................................           104.438%
               2008.......................................           102.958%
               2009.......................................           101.479%
               2010 and thereafter........................           100.000%

                                       39
<PAGE>

         (d) Any redemption pursuant to this Section 3.07 shall be made pursuant
to the provisions of Section 3.01 through 3.06 hereof.

Section 3.08  Mandatory Redemption.

         The Company is not required to make mandatory redemption or sinking
fund payments with respect to the Notes.

Section 3.09  Offer to Purchase by Application of Excess Proceeds.

         In the event that, pursuant to Section 4.10 hereof, the Company is
required to commence an offer to all Holders to purchase Notes (an "Asset Sale
Offer"), it will follow the procedures specified below.

         The Asset Sale Offer shall be made to all Holders and all holders of
other Indebtedness that is pari passu with the Notes containing provisions
similar to those set forth in this Indenture with respect to offers to purchase
or redeem with the proceeds of sales and assets. The Asset Sale Offer will
remain open for a period of at least 20 Business Days following its commencement
and not more than 30 Business Days, except to the extent that a longer period is
required by applicable law (the "Offer Period"). No later than three Business
Days after the termination of the Offer Period (the "Purchase Date"), the
Company will apply all Excess Proceeds (the "Offer Amount") to the purchase of
Notes and such other pari passu Indebtedness (on a pro rata basis, if
applicable) or, if less than the Offer Amount has been tendered, all Notes and
other Indebtedness tendered in response to the Asset Sale Offer. Payment for any
Notes so purchased will be made in the same manner as interest payments are
made.

         If the Purchase Date is on or after an interest record date and on or
before the related interest payment date, any accrued and unpaid interest, and
Liquidated Damages, if any, will be paid to the Person in whose name a Note is
registered at the close of business on such record date, and no additional
interest will be payable to Holders who tender Notes pursuant to the Asset Sale
Offer.

         Upon the commencement of an Asset Sale Offer, the Company will send, by
first class mail, a notice to the Trustee and each of the Holders, with a copy
to the Trustee. The notice will contain all instructions and materials necessary
to enable such Holders to tender Notes pursuant to the Asset Sale Offer. The
notice, which will govern the terms of the Asset Sale Offer, will state:

                  (1) that the Asset Sale Offer is being made pursuant to this
         Section 3.09 and Section 4.10 hereof and the length of time the Asset
         Sale Offer will remain open;

                  (2) the Offer Amount, the purchase price and the Purchase
         Date;

                  (3) that any Note not tendered or accepted for payment will
         continue to accrue interest;

                  (4) that, unless the Company defaults in making such payment,
         any Note accepted for payment pursuant to the Asset Sale Offer will
         cease to accrue interest after the Purchase Date;

                  (5) that Holders electing to have a Note purchased pursuant to
         an Asset Sale Offer may elect to have Notes purchased in integral
         multiples of $1,000 only;

                  (6) that Holders electing to have a Note purchased pursuant to
         any Asset Sale Offer will be required to surrender the Note, with the
         form entitled "Option of Holder to Elect Purchase" on the reverse of
         the Note completed, or transfer by book-entry transfer, to the

                                       40
<PAGE>

         Company, a Depositary, if appointed by the Company, or a Paying Agent
         at the address specified in the notice at least three days before the
         Purchase Date;

                  (7) that Holders will be entitled to withdraw their election
         if the Company, the Depositary or the Paying Agent, as the case may be,
         receives, not later than the expiration of the Offer Period, a
         telegram, telex, facsimile transmission or letter setting forth the
         name of the Holder, the principal amount of the Note the Holder
         delivered for purchase and a statement that such Holder is withdrawing
         his election to have such Note purchased;

                  (8) that, if the aggregate principal amount of Notes and other
         pari passu Indebtedness surrendered by Holders exceeds the Offer
         Amount, the Company will select the Notes and other pari passu
         Indebtedness to be purchased on a pro rata basis based on the principal
         amount of Notes and such other pari passu Indebtedness surrendered
         (with such adjustments as may be deemed appropriate by the Company so
         that only Notes in denominations of $1,000, or integral multiples
         thereof, will be purchased); and

                  (9) that Holders whose Notes were purchased only in part will
         be issued new Notes equal in principal amount to the unpurchased
         portion of the Notes surrendered (or transferred by book-entry
         transfer).

         On or before the Purchase Date, the Company will, to the extent lawful,
accept for payment, on a pro rata basis to the extent necessary, the Offer
Amount of Notes or portions thereof tendered pursuant to the Asset Sale Offer,
or if less than the Offer Amount has been tendered, all Notes tendered, and will
deliver to the Trustee an Officers' Certificate stating that such Notes or
portions thereof were accepted for payment by the Company in accordance with the
terms of this Section 3.09. The Company, the Depositary or the Paying Agent, as
the case may be, will promptly (but in any case not later than five days after
the Purchase Date) mail or deliver to each tendering Holder an amount equal to
the purchase price of the Notes tendered by such Holder and accepted by the
Company for purchase, and the Company will promptly issue a new Note, and the
Trustee, upon written request from the Company will authenticate and mail or
deliver such new Note to such Holder, in a principal amount equal to any
unpurchased portion of the Note surrendered. Any Note not so accepted shall be
promptly mailed or delivered by the Company to the Holder thereof. The Company
will publicly announce the results of the Asset Sale Offer on the Purchase Date.

         Other than as specifically provided in this Section 3.09, any purchase
pursuant to this Section 3.09 shall be made pursuant to the provisions of
Sections 3.01 through 3.06 hereof.

                                   ARTICLE 4.
                                    COVENANTS

Section 4.01  Payment of Notes.

         The Company will pay or cause to be paid the principal of, premium, if
any, and interest and Liquidated Damages, if any, on the Notes on the dates and
in the manner provided in the Notes. An installment of principal, premium, if
any, and interest and Liquidated Damages, if any, will be considered paid on the
date due if the Paying Agent, if other than the Company or a Subsidiary thereof,
holds as of 10:00 a.m. Eastern Time on the due date money deposited by the
Company in immediately available funds and designated for and sufficient to pay
all principal, premium, if any, and interest and Liquidated Damages, if any,
then due. If the Company or a Subsidiary thereof acts as the Paying Agent, an
installment of principal, premium, if any, interest or Liquidated Damages, if
any, shall be considered paid on the date due if the separate trust fund for the
benefit of the Holders created in compliance with the

                                       41
<PAGE>

penultimate sentence of Section 2.04 hereof holds as of 10:00 a.m. Eastern Time
on the due date money in immediately available funds and designated for and
sufficient to pay all principal, premium, if any, interest and Liquidated
Damages, if any, then due. The Company will pay all Liquidated Damages, if any,
in the same manner on the dates and in the amounts set forth in the Registration
Rights Agreement.

         The Company will pay interest (including post-petition interest in any
proceeding under any Bankruptcy Law) on overdue principal at the rate equal to
1% per annum in excess of the then applicable interest rate on the Notes to the
extent lawful; it will pay interest (including post-petition interest in any
proceeding under any Bankruptcy Law) on overdue installments of interest and
Liquidated Damages (without regard to any applicable grace period) at the same
rate to the extent lawful.

Section 4.02  Maintenance of Office or Agency.

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

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

         The Company hereby designates the Corporate Trust Office of the Trustee
as one such office or agency of the Company in accordance with Section 2.03
hereof.

Section 4.03  Reports.

         (a) Whether or not required by rules and regulations of the SEC, as
long as any Notes are outstanding, the Company will furnish to the Holders of
Notes, within the time periods specified in the SEC's rules and regulations:

               (1)  all quarterly and annual financial information that would be
                    required to be contained in a filing with the SEC on Forms
                    10-Q and 10-K if the Company were required to file such
                    forms, including a "Management's Discussion and Analysis of
                    Financial Condition and Results of Operations" and, with
                    respect to the annual information only, a report on the
                    annual financial statements by the Company's certified
                    independent accountants; and

               (2)  all current reports that would be required to be filed with
                    the SEC on Form 8-K if the Company were required to file
                    such reports.

         (b) If the Company has designated any of its Subsidiaries as
Unrestricted Subsidiaries, then the quarterly and annual financial information
required by paragraph (a) above will include a reasonably detailed presentation,
either on the face of the financial statements or in the footnotes thereto, and
in Management's Discussion and Analysis of Financial Condition and Results of
Operations, of the financial

                                       42
<PAGE>

condition and results of operations of the Company and its Restricted
Subsidiaries separate from the financial condition and results of operations of
the Unrestricted Subsidiaries of the Company.

         (c) Following the consummation of the Exchange Offer contemplated by
the Registration Rights Agreement, whether or not required by the SEC, the
Company will file a copy of all of the information and reports referred to in
clauses (1) and (2) of paragraph (a) above with the SEC for public availability
within the time periods specified in the SEC's rules and regulations (unless the
SEC will not accept such a filing) and make such information available to
securities analysts and prospective investors upon request. The Company will at
all times comply with TIA ss. 314(a).

         (d) For so long as any Notes remain outstanding, the Company will
furnish to the Holders and to securities analysts and prospective investors,
upon their request, the information required to be delivered pursuant to Rule
144A(d)(4) under the Securities Act.

Section 4.04  Compliance Certificate.

         (a) The Company and each Guarantor, if any (to the extent that such
Guarantor is so required under the TIA), shall deliver to the Trustee, within 90
days after the end of each fiscal year, an Officers' Certificate stating that a
review of the activities of the Company and its Subsidiaries during the
preceding fiscal year has been made under the supervision of the signing
Officers with a view to determining whether the Company has kept, observed,
performed and fulfilled its obligations under this Indenture, and further
stating, as to each such Officer signing such certificate, that to the best of
his or her knowledge the Company has kept, observed, performed and fulfilled
each and every covenant contained in this Indenture and is not in default in the
performance or observance of any of the terms, provisions and conditions of this
Indenture (or, if a Default or Event of Default has occurred, describing all
such Defaults or Events of Default of which he or she may have knowledge and
what action the Company is taking or proposes to take with respect thereto) and
that to the best of his or her knowledge no event has occurred and remains in
existence by reason of which payments on account of the principal of or
interest, if any, on the Notes is prohibited or if such event has occurred, a
description of the event and what action the Company is taking or proposes to
take with respect thereto.

         (b) So long as not contrary to the then current recommendations of the
American Institute of Certified Public Accountants, the year-end financial
statements delivered pursuant to Section 4.03(a) above shall be accompanied by a
written statement of the Company's independent public accountants (who shall be
a firm of established national reputation) that in making the examination
necessary for certification of such financial statements, nothing has come to
their attention that would lead them to believe that the Company has violated
any provisions of Article 4 or Article 5 hereof or, if any such violation has
occurred, specifying the nature and period of existence thereof, it being
understood that such accountants shall not be liable directly or indirectly to
any Person for any failure to obtain knowledge of any such violation.

         (c) So long as any of the Notes are outstanding, the Company will
deliver to the Trustee, forthwith upon any Officer becoming aware of any Default
or Event of Default, an Officers' Certificate specifying such Default or Event
of Default and what action the Company is taking or proposes to take with
respect thereto.

Section 4.05  Taxes.

         The Company will pay, and will cause each of its Subsidiaries to pay,
prior to delinquency, all material taxes, assessments, and governmental levies
except such as are contested in good faith and by

                                       43
<PAGE>

appropriate proceedings or where the failure to effect such payment is not
adverse in any material respect to the Holders of the Notes.

Section 4.06  Stay, Extension and Usury Laws.

         The Company and each Guarantor, if any, covenants (to the extent that
it may lawfully do so) that it will not at any time insist upon, plead, or in
any manner whatsoever claim or take the benefit or advantage of, any stay,
extension or usury law wherever enacted, now or at any time hereafter in force,
that may affect the covenants or the performance of this Indenture; and the
Company and each of the Guarantors, if any (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, by resort to any such law, 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 has been enacted.

Section 4.07  Restricted Payments.

         (a) The Company will not, and will not permit any of its Restricted
Subsidiaries to, directly or indirectly:

                  (1) declare or pay any dividend or make any other payment or
         distribution on account of the Company's or any of its Restricted
         Subsidiaries' Equity Interests (including, without limitation, any
         payment in connection with any merger or consolidation involving the
         Company or any of its Restricted Subsidiaries) or to the direct or
         indirect holders of the Company's or any of its Restricted
         Subsidiaries' Equity Interests in their capacity as such (other than
         dividends or distributions payable in Equity Interests (other than
         Disqualified Stock) of the Company or dividends or distributions
         payable to the Company or a Restricted Subsidiary of the Company);

                  (2) purchase, redeem or otherwise acquire or retire for value
         (including, without limitation, in connection with any merger or
         consolidation involving the Company) any Equity Interests of the
         Company or any direct or indirect parent of the Company;

                  (3) make any payment on or with respect to, or purchase,
         redeem, defease or otherwise acquire or retire for value any
         Indebtedness that is subordinated to the Notes or any Note Guarantees,
         except a payment of interest or principal at the Stated Maturity
         thereof or any payment to the Company with respect to Indebtedness owed
         solely to the Company; or

                  (4) make any Restricted Investment (all such payments and
         other actions set forth in these clauses (1) through (4) above being
         collectively referred to as "Restricted Payments"),

unless, at the time of and after giving effect to such Restricted Payment:

                  (1) no Triggering Default Event has occurred and is continuing
         or would occur as a consequence of such Restricted Payment; and

                  (2) the Company would, at the time of such Restricted Payment
         and after giving pro forma effect thereto as if such Restricted Payment
         had been made at the beginning of the applicable four-quarter period,
         have been permitted to incur at least $1.00 of additional Indebtedness
         pursuant to the Fixed Charge Coverage Ratio test set forth in Section
         4.09(a) hereof; and

                                       44
<PAGE>

                  (3) such Restricted Payment, together with the aggregate
         amount of all other Restricted Payments made by the Company and its
         Restricted Subsidiaries after the date of this Indenture (excluding
         Restricted Payments permitted by Sections 4.07(b)(2), (3), (4), (6),
         (7) and (8) hereof), is less than the sum, without duplication, of:

                      (a) 50% of the Consolidated Net Income of the Company for
         the period (taken as one accounting period) from the beginning of the
         first fiscal quarter commencing after August 2, 1997 to the end of the
         Company's most recently ended fiscal quarter for which internal
         financial statements are available at the time of such Restricted
         Payment (which amount as of February 2, 2002 was $24.4 million) (or, if
         such Consolidated Net Income for such period is a deficit, less 100% of
         such deficit), plus

                      (b) 100% of the aggregate net cash proceeds and the fair
         market value (as determined in good faith by the Board of Directors of
         the Company) of Productive Assets received by the Company since the
         date of this Indenture as a contribution to its common equity capital
         or from the issue or sale of Equity Interests of the Company (other
         than Disqualified Stock) or from the issue or sale of convertible or
         exchangeable Disqualified Stock or convertible or exchangeable debt
         securities of the Company that have been converted into or exchanged
         for such Equity Interests (other than Equity Interests (or Disqualified
         Stock or debt securities) sold to a Subsidiary of the Company);
         provided that if the fair market value of such Productive Assets
         received by the Company is in excess of $20.0 million, then the Company
         must deliver to the Trustee an opinion as to the value of such
         consideration issued by an accounting, appraisal or investment banking
         firm of national standing, plus

                      (c) to the extent that any Restricted Investment that was
         made after the date of this Indenture is sold for cash or otherwise
         liquidated or repaid for cash, the lesser of (i) the cash return of
         capital with respect to such Restricted Investment (less the cost of
         disposition, if any) and (ii) the initial amount of such Restricted
         Investment, plus

                      (d) 50% of the amount of any dividends paid in cash
         received by the Company or a Restricted Subsidiary of the Company after
         the date of this Indenture from an Unrestricted Subsidiary of the
         Company, to the extent that the dividends were not otherwise included
         in Consolidated Net Income of the Company for the period, plus

                      (e) to the extent that any Unrestricted Subsidiary of the
         Company is redesignated as a Restricted Subsidiary after the date of
         this Indenture, the lesser of (i) the fair market value of the
         Company's Investment in that Subsidiary as of the date of the
         redesignation and (ii) the initial amount of such Restricted
         Investment.

         (b) The provisions of Section 4.07(a) will not prohibit:

                  (1) so long as no Default has occurred and is continuing or
         would be caused thereby, the payment of any dividend within 60 days
         after the date of declaration of the dividend, if at the date of
         declaration the dividend payment would have complied with the
         provisions of this Indenture;

                  (2) the redemption, repurchase, retirement, defeasance or
         other acquisition of any subordinated Indebtedness of the Company or
         any Guarantor or of any Equity Interests of the Company in exchange
         for, or out of the net cash proceeds of the substantially concurrent
         sale (other than to a Restricted Subsidiary of the Company) of, Equity
         Interests of the Company (other than Disqualified Stock); provided that
         the amount of any such net cash proceeds that are utilized

                                       45
<PAGE>

         for any such redemption, repurchase, retirement, defeasance or other
         acquisition will be excluded from clause (3) (b) of the preceding
         paragraph;

                  (3) the defeasance, redemption, repurchase or other
         acquisition of subordinated Indebtedness of the Company or any
         Guarantor with the net cash proceeds from an incurrence of Permitted
         Refinancing Indebtedness;

                  (4) the payment of any dividend by a Restricted Subsidiary of
         the Company to the holders of its Equity Interests on a pro rata basis;

                  (5) so long as no Default has occurred and is continuing or
         would be caused thereby, the repurchase, redemption or other
         acquisition or retirement for value of any Equity Interests of the
         Company or the Parent or any current or former Restricted Subsidiary of
         the Company held by any current or former employee, officer, director
         or consultant of the Company (or any of its Restricted Subsidiaries)
         under any management equity subscription agreement, stock option
         agreement or other employee or management plan or agreement or
         employment benefit plan; provided that the aggregate price paid for all
         such repurchased, redeemed, acquired or retired Equity Interests shall
         not exceed $4.0 million;

                  (6) the payment of dividends to the Parent solely for the
         purpose of enabling Parent to pay the ordinary operating and
         administrative expenses of the Parent (including all reasonable
         professional fees and expenses) in connection with complying with its
         reporting obligations and obligations to prepare and distribute
         business records in the ordinary course of business and the Parent's
         costs and expenses relating to taxes (which taxes are attributable to
         the operations of the Company and its Subsidiaries or to the Parent's
         ownership thereof); provided, however, that the aggregate dividend
         payment paid in each fiscal year pursuant to this clause (6) will at no
         time exceed 0.25% of the Company's "Net Revenue," as shown on the
         Company's audited consolidated statements of income for such fiscal
         year;

                  (7) payments to the Parent for income taxes pursuant to the
         Tax Allocation Agreement;

                  (8) the payment of dividends to the Parent solely for the
         purpose of enabling the Parent to pay taxes other than income taxes, to
         the extent actually owed and attributable to the operations of the
         Company and its Subsidiaries or to the Parent's ownership thereof;

                  (9) repurchases of Capital Stock deemed to occur upon the
         exercise of stock options if such Capital Stock represents a portion of
         the exercise price thereof; and

                  (10) so long as no Default has occurred and is continuing or
         would be caused thereby, other Restricted Payments not to exceed $25.0
         million in the aggregate.

         The amount of all Restricted Payments (other than cash) will be the
fair market value on the date of the Restricted Payment of the asset(s) or
securities proposed to be transferred or issued by the Company or such
Subsidiary, as the case may be, pursuant to the Restricted Payment. The fair
market value of any assets or securities that are required to be valued by this
Section 4.07 will be determined by the Board of Directors. The Board of
Directors' determination must be based upon an opinion or appraisal issued by an
accounting, appraisal or investment banking firm of national standing if the
fair market value exceeds $10.0 million. Not later than the date of making any
Restricted Payment, the Company will deliver to the Trustee an Officers'
Certificate stating that such Restricted Payment is permitted and setting forth
the basis upon which the

                                       46
<PAGE>

calculations required by this Section 4.07 were computed, together with a copy
of any fairness opinion or appraisal required by this Indenture.

Section 4.08  Dividend and Other Payment Restrictions Affecting Subsidiaries.

         (a) The Company will not, and will not permit any of its Restricted
Subsidiaries to, directly or indirectly, create or permit to exist or become
effective any consensual encumbrance or restriction on the ability of any
Restricted Subsidiary to:

            (1)   pay dividends or make any other distributions on its Capital
                  Stock to the Company or any of its Restricted Subsidiaries, or
                  with respect to any other interest or participation in, or
                  measured by, its profits, or pay any indebtedness owed to the
                  Company or any of its Restricted Subsidiaries;

            (2)   make loans or advances to the Company or any of its Restricted
                  Subsidiaries; or

            (3)   transfer any of its properties or assets to the Company or any
                  of its Restricted Subsidiaries.

         (b) The restrictions in Section 4.08(a) will not apply to encumbrances
or restrictions existing under or by reason of:

                  (1) agreements governing Existing Indebtedness and the Senior
         Credit Facility as in effect on the date of this Indenture and any
         amendments, modifications, restatements, renewals, increases,
         supplements, refundings, replacements or refinancings of those
         agreements; provided that the amendments, modifications, restatements,
         renewals, increases, supplements, refundings, replacement or
         refinancings are no more restrictive, taken as a whole, with respect to
         such dividend and other payment restrictions than those contained in
         those agreements on the date of this Indenture;

                  (2) this Indenture, the Notes and any Note Guarantee;

                  (3) applicable law or regulation;

                  (4) any instrument governing Indebtedness or Capital Stock of
         a Person acquired by the Company or any of its Restricted Subsidiaries
         as in effect at the time of such acquisition (except to the extent such
         Indebtedness or Capital Stock was incurred in connection with or in
         contemplation of such acquisition), which encumbrance or restriction is
         not applicable to any Person, or the properties or assets of any
         Person, other than the Person, or the property or assets of the Person,
         so acquired; provided that, in the case of Indebtedness, such
         Indebtedness was permitted by the terms of this Indenture to be
         incurred;

                  (5) customary non-assignment provisions in leases entered into
         in the ordinary course of business;

                  (6) purchase money obligations for property acquired in the
         ordinary course of business that impose restrictions on that property
         of the nature described in clause (3) of Section 4.06(a);

                  (7) any agreement for the sale or other disposition of a
         Restricted Subsidiary that restricts distributions by that Restricted
         Subsidiary pending its sale or other disposition;

                                       47
<PAGE>

                  (8) Permitted Refinancing Indebtedness; provided that the
         restrictions contained in the agreements governing such Permitted
         Refinancing Indebtedness are no more restrictive, taken as a whole,
         than those contained in the agreements governing the Indebtedness being
         refinanced;

                  (9) Liens securing Indebtedness otherwise permitted to be
         incurred under Section 4.12 hereof that limit the right of the debtor
         to dispose of the assets subject to such Liens;

                  (10) provisions with respect to the disposition or
         distribution of assets or property in joint venture agreements, assets
         sale agreements, stock sale agreements and other similar agreements
         entered into in the ordinary course of business;

                  (11) restrictions on cash or other deposits or net worth
         imposed by customers under contracts entered into in the ordinary
         course of business;

                  (12) Indebtedness (other than Permitted Refinancing
         Indebtedness) incurred after the date of this Indenture in accordance
         with the terms of the Indenture; provided that the restrictions
         contained in the agreements governing such Indebtedness are no more
         restrictive, taken as a whole, than those contained in the agreements
         governing Indebtedness outstanding on the date of the Indenture; and

                  (13) any encumbrances or restrictions imposed by any
         amendments, modifications, restatements, renewals, increases,
         supplements, refundings, replacements or refinancings of the contracts,
         instruments or obligations referred to in clauses (1) through (12)
         above; provided that the amendments, modifications, restatements,
         renewals, increases, supplements, refundings, replacements or
         refinancings are no more restrictive, taken as a whole, with respect to
         the dividend and other payment restrictions than those contained in the
         dividend or other payment restrictions before the amendment,
         modification, restatement, renewal, increase, supplement, refunding,
         replacement or refinancing.

Section 4.09  Incurrence of Indebtedness and Issuance of Preferred Stock.

         (a) The Company will not, and will not permit any of its Restricted
Subsidiaries to, directly or indirectly, create, incur, issue, assume, guarantee
or otherwise become directly or indirectly liable, contingently or otherwise,
with respect to (collectively, "incur") any Indebtedness (including Acquired
Debt), and the Company will not issue any Disqualified Stock and will not permit
any of its Restricted Subsidiaries to issue any shares of preferred stock other
than to the Company; provided, however, that, so long as no Triggering Default
Event has occurred and is continuing, the Company and any Guarantor may incur
Indebtedness (including Acquired Debt) or issue Disqualified Stock if the Fixed
Charge Coverage Ratio for the Company's most recently ended four full fiscal
quarters for which internal financial statements are available immediately
preceding the date on which such additional Indebtedness is incurred or such
Disqualified Stock or preferred stock is issued would have been at least 2.0 to
1, determined on a pro forma basis (including a pro forma application of the net
proceeds therefrom), as if the additional Indebtedness had been incurred or the
preferred stock or Disqualified Stock had been issued, as the case may be, at
the beginning of such four-quarter period.

         (b) The provisions of Section 4.09(a) will not prohibit the incurrence
of any of the following items of Indebtedness (collectively, "Permitted Debt"):

                  (1) the incurrence by the Company and any of its Restricted
         Subsidiaries of Indebtedness and letters of credit under the Senior
         Credit Facility in an aggregate principal amount at any one time
         outstanding under this clause (1) (with letters of credit being deemed
         to

                                       48
<PAGE>

         have a principal amount equal to the maximum potential liability of the
         Company and its Restricted Subsidiaries thereunder) not to exceed the
         greater of (a) $100.0 million less any permanent commitment reductions
         since the date of this Indenture associated with the application of Net
         Proceeds of Asset Sales or (b) the sum of (x) 80% of consolidated
         accounts receivable of the Company and its Restricted Subsidiaries and
         (y) 50% of consolidated inventory of the Company and its Restricted
         Subsidiaries;

                  (2) the incurrence by the Company and its Restricted
         Subsidiaries of Existing Indebtedness;

                  (3) the incurrence by the Company and any Guarantors of
         Indebtedness represented by the Notes to be issued on the date of this
         Indenture and the Note Guarantees, if any, and the Exchange Notes to be
         issued pursuant to the Registration Rights Agreement and the Note
         Guarantees, if any, thereon;

                  (4) the incurrence by the Company or any of its Restricted
         Subsidiaries of Indebtedness represented by Capital Lease Obligations,
         mortgage financings or purchase money obligations, in each case,
         incurred for the purpose of financing all or any part of the purchase
         price or cost of construction or improvement of property, plant or
         equipment used in the business of the Company or such Restricted
         Subsidiary, in an aggregate principal amount, including all Permitted
         Refinancing Indebtedness incurred to refund, refinance or replace any
         Indebtedness incurred pursuant to this clause (4), not to exceed $15.0
         million at any time outstanding;

                  (5) the incurrence by the Company or any of the Guarantors of
         Permitted Refinancing Indebtedness in exchange for, or the net proceeds
         of which are used to refund, refinance or replace Indebtedness (other
         than intercompany Indebtedness) that was permitted by this Indenture to
         be incurred under Section 4.09(a) hereof or clauses (2), (3), (4), (5),
         (10), (11) or (12) of this Section 4.09(b);

                  (6) the incurrence by the Company or any of its Restricted
         Subsidiaries of intercompany Indebtedness between or among the Company
         and any of its Restricted Subsidiaries; provided, however, that (i) any
         subsequent issuance or transfer of Equity Interests that results in any
         such Indebtedness being held by a Person other than the Company or a
         Restricted Subsidiary of the Company and (ii) any sale or other
         transfer of any such Indebtedness to a Person that is not either the
         Company or a Restricted Subsidiary of the Company; will be deemed, in
         each case, to constitute an incurrence of such Indebtedness by the
         Company or such Restricted Subsidiary, as the case may be, that was not
         permitted by this clause (6);

                  (7) the incurrence by the Company or any of its Restricted
         Subsidiaries of Hedging Obligations that are incurred for the purpose
         of fixing or hedging (a) interest rate risk with respect to any
         Indebtedness that is permitted by the terms of this Indenture to be
         outstanding or (b) risk associated with fluctuations in foreign
         currency exchange rates;

                  (8) the guarantee by the Company or any of the Guarantors of
         Indebtedness of the Company or a Restricted Subsidiary of the Company
         that was permitted to be incurred by another provision of this Section
         4.09;

                  (9) the accrual of interest, the accretion or amortization of
         original issue discount, the payment of interest on any Indebtedness in
         the form of additional Indebtedness with the same terms, and the
         payment of dividends on Disqualified Stock in the form of additional
         shares of the same class of Disqualified Stock will not be deemed to be
         an incurrence of Indebtedness or an

                                       49
<PAGE>

         issuance of Disqualified Stock for purposes of this Section 4.09;
         provided, in each such case, that the amount thereof is included in
         Fixed Charges of the Company as accrued;

                  (10) Indebtedness of the Company or its Restricted
         Subsidiaries that do not in the aggregate exceed $10.0 million in
         principal amount at any time outstanding with respect to guarantees of
         obligations of franchisees in a business related to the optical
         business of the Company or any Restricted Subsidiary of the Company as
         conducted on the date of this Indenture;

                  (11) the incurrence by the Company or any of the Guarantors of
         additional Indebtedness or the issuance of Disqualified Stock in an
         aggregate principal amount (or accreted value, as applicable) at any
         time outstanding, including all Permitted Refinancing Indebtedness
         incurred to refund, refinance or replace any Indebtedness incurred
         pursuant to this clause (11), not to exceed $50.0 million;

                  (12) the incurrence of Indebtedness owing to any insurance
         company in connection with the financing of insurance premiums
         permitted by the insurance company in the ordinary course of business;
         and

                  (13) Indebtedness arising from agreements of the Company or a
         Restricted Subsidiary of the Company providing for indemnification,
         adjustment of purchase price, earn out or other similar obligations, in
         each case, incurred or assumed in connection with the acquisition or
         disposition of any business, assets or a Restricted Subsidiary of the
         Company, other than guarantees of Indebtedness incurred by any Person
         acquiring all or any portion of that business, assets or Restricted
         Subsidiary of the Company for the purpose of financing that
         acquisition; provided that the maximum assumable liability in respect
         of all of this Indebtedness shall at no time exceed the gross proceeds
         actually received by the Company and its Restricted Subsidiaries in
         connection with the disposition.

         Notwithstanding any other provision of this Section 4.09, the maximum
amount of Indebtedness that the Company or any Restricted Subsidiary of the
Company may incur pursuant to this Section 4.09 shall not be deemed to be
exceeded solely as a result of fluctuations in the exchange rates of currencies.

         For purposes of determining compliance with this Section 4.09, in the
event that an item of proposed Indebtedness meets the criteria of more than one
of the categories of Permitted Debt described in clauses (1) through (13) above,
or is entitled to be incurred pursuant to Section 4.09(a) hereof, the Company
will be permitted to classify such item of Indebtedness on the date of its
incurrence, or later reclassify all or a portion of such item of Indebtedness,
in any manner that complies with this Section 4.09. Indebtedness under the
Senior Credit Facility outstanding on the date on which Notes are first issued
and authenticated under this Indenture will be deemed to have been incurred on
such date in reliance on the exception provided by clause (1) of the definition
of Permitted Debt.

Section 4.10  Asset Sales.

         The Company will not, and will not permit any of its Restricted
Subsidiaries to, consummate an Asset Sale unless:

                  (1) the Company or the Restricted Subsidiary receives
         consideration at the time of the Asset Sale at least equal to the fair
         market value of the assets or Equity Interests issued or sold or
         otherwise disposed of;

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<PAGE>

                  (2) the fair market value is determined by the Company's Board
         of Directors; and

                  (3) except in the case of the sale, transfer or other
         disposition of the Company owned stores to franchisees in a business
         related to the optical business that results in the conversion of such
         stores to franchised stores, at least 75% of the consideration received
         in the Asset Sale by the Company or such Restricted Subsidiary is in
         the form of cash, Cash Equivalents or Productive Assets. For purposes
         of this provision, each of the following will be deemed to be cash:

                      (a) any liabilities, as shown on the Company's most recent
         consolidated balance sheet, of the Company or any Restricted Subsidiary
         (other than contingent liabilities and liabilities that are by their
         terms subordinated to the Notes or any Note Guarantee) that are assumed
         by the transferee of any such assets pursuant to a customary novation
         agreement that releases the Company or such Restricted Subsidiary from
         further liability; and

                      (b) any securities, notes or other obligations received by
         the Company or any such Restricted Subsidiary from such transferee that
         are contemporaneously, subject to ordinary settlement periods,
         converted by the Company or such Restricted Subsidiary into cash, to
         the extent of the cash received in that conversion.

         Within 365 days after the receipt of any Net Proceeds from an Asset
Sale, the Company may apply those Net Proceeds at its option:

                  (1) to repay Senior Debt or Indebtedness of the Company or a
         Restricted Subsidiary of the Company and to correspondingly permanently
         reduce commitments with respect thereto;

                  (2) to acquire all or substantially all of the assets of, or a
         majority of the Voting Stock of, another Permitted Business;

                  (3) to make a capital expenditure relating to a Permitted
         Business; or

                  (4) to acquire other long-term assets that are used or useful
         in a Permitted Business.

Pending the final application of any Net Proceeds, the Company may temporarily
reduce revolving credit borrowings or otherwise invest the Net Proceeds in any
manner that is not prohibited by this Indenture.

         Any Net Proceeds from Asset Sales that are not applied or invested as
provided in the second preceding paragraph will constitute "Excess Proceeds."
When the aggregate amount of Excess Proceeds exceeds $10.0 million, the Company
will (a) first, make an Excess Proceeds Offer (as defined in the 9 7/8% Notes
Indenture) with respect to any outstanding 9 7/8% Notes, (b) second, make an
Excess Proceeds Offer (as defined in the 8 5/8% Notes Indenture) with respect to
any outstanding 8 5/8% Notes, and (c) third, make an Asset Sale Offer to all
Holders of Notes and all holders of other Indebtedness that is pari passu with
the Notes containing provisions similar to those set forth in this Indenture
with respect to offers to purchase or redeem with the proceeds of sales of
assets in accordance with Section 3.09 hereof to purchase the maximum principal
amount of Notes and such other pari passu Indebtedness that may be purchased out
of the Excess Proceeds. The offer price in any Asset Sale Offer will be equal to
100% of principal amount plus accrued and unpaid interest and Liquidated
Damages, if any, to the date of purchase, and will be payable in cash. If any
Excess Proceeds remain after consummation of an Asset Sale Offer, the Company
may use those Excess Proceeds for any purpose not otherwise prohibited by this
Indenture. If the aggregate principal amount of Notes and other pari passu
Indebtedness tendered into such Asset Sale Offer exceeds the amount of Excess
Proceeds, the Trustee will select the Notes and such other pari passu
Indebtedness to be purchased on a pro rata basis based on the principal amount
of Notes

                                       51
<PAGE>

and such other pari passu Indebtedness tendered. Upon completion of each Asset
Sale Offer, the amount of Excess Proceeds will be reset at zero.

         The Company will comply with the requirements of Rule 14e-1 under the
Exchange Act and any other securities laws and regulations thereunder to the
extent those laws and regulations are applicable in connection with each
repurchase of Notes pursuant to an Asset Sale Offer. To the extent that the
provisions of any securities laws or regulations conflict with the provisions of
Section 3.09 hereof or this Section 4.10, the Company will comply with the
applicable securities laws and regulations and will not be deemed to have
breached its obligations under the provisions of Section 3.09 hereof or this
Section 4.10 by virtue of such conflict.

Section 4.11  Transactions with Affiliates.

         (a) The Company will not, and will not permit any of its Restricted
Subsidiaries to, make any payment to, or sell, lease, transfer or otherwise
dispose of any of its properties or assets to, or purchase any property or
assets from, or enter into or make or amend any transaction, contract,
agreement, understanding, loan, advance or guarantee with, or for the benefit
of, any Affiliate (each an "Affiliate Transaction"), unless:

                  (1) the Affiliate Transaction is on terms that are no less
         favorable to the Company or the relevant Restricted Subsidiary than
         those that would have been obtained in a comparable transaction by the
         Company or such Restricted Subsidiary with an unrelated Person; and

                  (2) the Company delivers to the Trustee:

                      (a) with respect to any Affiliate Transaction or series
         of related Affiliate Transactions involving aggregate consideration in
         excess of $5.0 million, a resolution of the Board of Directors set
         forth in an Officers' Certificate certifying that such Affiliate
         Transaction complies with this Section 4.11 and that such Affiliate
         Transaction has been approved by a majority of the disinterested
         members of the Board of Directors; and

                      (b) with respect to any Affiliate Transaction or series
         of related Affiliate Transactions involving aggregate consideration in
         excess of $10.0 million, an opinion as to the fairness to the Company
         of such Affiliate Transaction from a financial point of view issued by
         an accounting, appraisal or investment banking firm of national
         standing.

         (b) The following items will not be deemed to be Affiliate Transactions
and, therefore, will not be subject to the provisions of the prior paragraph of
this Section 4.11.

                  (1) any employment agreement or other compensation-related
         transaction, approved by an independent committee of the Board of
         Directors of the Company, entered into by the Company or any of its
         Restricted Subsidiaries in the ordinary course of business of the
         Company or such Restricted Subsidiary;

                  (2) transactions between or among the Company and/or its
         Wholly-Owned Restricted Subsidiaries;

                  (3) transactions with a Person that is an Affiliate of the
         Company solely because the Company owns an Equity Interest in, or
         controls, such Person;

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<PAGE>

                  (4) payment of reasonable directors fees to Persons who are
         not otherwise Affiliates of the Company;

                  (5) Restricted Payments that are permitted by Section 4.07
         hereof;

                  (6) the Tax Allocation Agreement;

                  (7) Indebtedness incurred by the Company to the Parent;
         provided such Indebtedness has terms no more onerous than those
         contained in the Senior Credit Facility;

                  (8) providing indemnity to current or former officers,
         directors, employees or consultants of the Company or any of its
         Subsidiaries as determined in good faith by the Board of Directors of
         the Company.

Section 4.12  Liens.

         The Company will not, and will not permit any of its Restricted
Subsidiaries to, directly or indirectly, create, incur, assume or suffer to
exist any Lien of any kind securing Indebtedness that is pari passu or
subordinated in right of payment to the Notes upon any of their property or
assets, now owned or hereafter acquired, unless all payments due under this
Indenture and the Notes are secured on an equal and ratable basis with the
obligations so secured until such time as such obligations are no longer secured
by a Lien, in each case, except Permitted Liens.

Section 4.13  Corporate Existence.

         Subject to Article 5 hereof, the Company will do or cause to be done
all things necessary to preserve and keep in full force and effect:

                  (1) its corporate existence, and the corporate, partnership or
         other existence of each of its Subsidiaries, in accordance with the
         respective organizational documents (as the same may be amended from
         time to time) of the Company or any such Subsidiary; and

                  (2) the rights (charter and statutory), licenses and
         franchises of the Company and its Subsidiaries; provided, however, that
         the Company shall not be required to preserve any such right, license
         or franchise, or the corporate, partnership or other existence of any
         of its Subsidiaries, if the Board of Directors shall determine that the
         preservation thereof is no longer desirable in the conduct of the
         business of the Company and its Subsidiaries, taken as a whole, and
         that the loss thereof is not adverse in any material respect to the
         Holders of the Notes.

Section 4.14  Offer to Repurchase Upon Change of Control.

         (a) Upon the occurrence of a Change of Control, the Company will make
an offer (a "Change of Control Offer") to each Holder to repurchase all or any
part (equal to $1,000 or an integral multiple of $1,000) of each Holder's Notes
at a purchase price equal to 101% of the aggregate principal amount thereof plus
accrued and unpaid interest and Liquidated Damages on the Notes repurchased, if
any, to the date of purchase (the "Change of Control Payment"). Within 15 days
following any Change of Control, the Company will mail a notice to each Holder
describing the transaction or transactions that constitute the Change of Control
and stating:

              (1)    that the Change of Control Offer is being made pursuant to
                     this Section 4.14 and that all Notes tendered will be
                     accepted for payment;

                                       53
<PAGE>

              (2)    the purchase price and the purchase date, which shall be no
                     earlier than 25 days and no later than 55 days from the
                     date such notice is mailed (the "Change of Control Payment
                     Date");

              (3)    that any Note not tendered will continue to accrue
                     interest;

              (4)    that, unless the Company defaults in the payment of the
                     Change of Control Payment, all Notes accepted for payment
                     pursuant to the Change of Control Offer will cease to
                     accrue interest after the Change of Control Payment Date;

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

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

              (7)    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, which
                     unpurchased portion must be equal to $1,000 in principal
                     amount or an integral multiple thereof.

         The Company will comply with the requirements of Rule 14e-1 under the
Exchange Act and any other securities laws and regulations thereunder to the
extent those laws and regulations are applicable in connection with the
repurchase of the Notes as a result of a Change in Control. To the extent that
the provisions of any securities laws or regulations conflict with the
provisions of Sections 3.09 or 4.14 of this Indenture, the Company will comply
with the applicable securities laws and regulations and will not be deemed to
have breached its obligations under Section 3.09 or this Section 4.14 by virtue
of such conflict.

         (b) On the Change of Control Payment Date, the Company will, to the
extent lawful:

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

                  (2) deposit with the Paying Agent an amount equal to the
         Change of Control Payment in respect of all Notes or portions of Notes
         properly tendered; and

                  (3) deliver or cause to be delivered to the Trustee the Notes
         so accepted together with an Officers' Certificate stating the
         aggregate principal amount of Notes or portions of Notes being
         purchased by the Company.

         The Paying Agent will promptly mail to each Holder of Notes properly
tendered the Change of Control Payment for such Notes, and the Trustee will
promptly authenticate and mail (or cause to be transferred by book entry) to
each Holder a new Note equal in principal amount to any unpurchased portion of
the Notes surrendered, if any; provided that each new Note will be in a
principal amount of

                                       54
<PAGE>

$1,000 or an integral multiple thereof. The Company will publicly announce the
results of the Change of Control Offer on or as soon as practicable after the
Change of Control Payment Date.

         Prior to complying with any of the provisions of this Section 4.14, but
in any event within 90 days following a Change of Control, the Company will
either repay all outstanding Senior Debt or obtain the requisite consents, if
any, under all agreements governing outstanding Senior Debt to permit the
repurchase of Notes required by this Section 4.14.

         (c) Notwithstanding anything to the contrary in this Section 4.14, the
Company 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
Section 4.14 and Section 3.09 hereof and purchases all Notes validly tendered
and not withdrawn under the Change of Control Offer.

Section 4.15  No Senior Subordinated Debt.

         The Company will not incur, create, issue, assume, guarantee or
otherwise become liable for any Indebtedness that is subordinate or junior in
right of payment to any Senior Debt of the Company and senior in any respect in
right of payment to the Notes. No Guarantor will incur, create, issue, assume,
guarantee or otherwise become liable for any Indebtedness that is subordinate or
junior in right of payment to the Senior Debt of such Guarantor and senior in
any respect in right of payment to such Guarantor's Note Guarantee.

Section 4.16  Limitation on Sale and Leaseback Transactions.

         The Company will not, and will not permit any of its Restricted
Subsidiaries to, enter into any sale and leaseback transaction; provided that
the Company or any Restricted Subsidiary may enter into a sale and leaseback
transaction if:

                  (1) the Company or that Restricted Subsidiary, as applicable,
         could have (a) incurred Indebtedness in an amount equal to the
         Attributable Debt relating to such sale and leaseback transaction under
         the Fixed Charge Coverage Ratio test in Section 4.09(a) hereof and (b)
         incurred a Lien to secure such Indebtedness pursuant to Section 4.12
         hereof;

                  (2) the gross cash proceeds of that sale and leaseback
         transaction are at least equal to the fair market value, as determined
         in good faith by the Board of Directors and set forth in an Officers'
         Certificate delivered to the Trustee, of the property that is the
         subject of that sale and leaseback transaction; and

                  (3) the transfer of assets in that sale and leaseback
         transaction is permitted by, and the Company applies the proceeds of
         such transaction in compliance with, Section 4.10 hereof.

Section 4.17  Limitation on Capital Stock of Restricted Subsidiaries.

         The Company will not:

                  (1) sell, pledge, hypothecate or otherwise convey or dispose
         of any Capital Stock of a Restricted Subsidiary (other than under the
         Senior Credit Facility or a successor facility or under the terms of
         any Designated Senior Debt) other than to the Company or a Wholly-Owned
         Restricted Subsidiary of the Company; or

                                       55
<PAGE>

                  (2) permit any of its Restricted Subsidiaries to issue any
         Capital Stock, other than to the Company or a Wholly-Owned Restricted
         Subsidiary of the Company.

         The foregoing restrictions shall not apply to an Asset Sale (other than
the sale of Preferred Stock of a Restricted Subsidiary of the Company) made in
compliance with Section 4.10 hereof.

Section 4.18  Future Note Guarantees.

         If any Restricted Subsidiary of the Company guarantees any Indebtedness
of another Person (other than under the Senior Credit Facility or any Permitted
Guarantee), pledges any of its assets to secure any Indebtedness of another
Person or otherwise provides direct credit support for any Indebtedness of
another Person, in each case, then such Restricted Subsidiary will become a
Guarantor of the Notes and execute a Supplemental Indenture and deliver an
Opinion of Counsel satisfactory to the Trustee within 10 Business Days of the
date on which such Restricted Subsidiary so guarantees, pledges its assets or
otherwise provides direct credit support. In addition, the Company may elect
that any Subsidiary of the Company become a Guarantor. Each such Note Guarantee
will be subordinated to the prior payment in full of all Senior Debt of such
Guarantor.

         The Note Guarantee of a Guarantor will be released:

                  (1) in connection with any sale or other disposition of all or
         substantially all of the assets of that Guarantor (including by way of
         merger or consolidation) to a Person that is not (either before or
         after giving effect to such transaction) a Subsidiary of the Company,
         if the sale or other disposition complies with the provisions of
         Sections 3.09 and 4.10 of this Indenture; or

                  (2) in connection with any sale of all of the Capital Stock of
         a Guarantor to a Person that is not (either before or after giving
         effect to such transaction) a Subsidiary of the Company; provided that
         such sale shall be subject to the provisions of Sections 3.09 and 4.10
         of this Indenture.

         Notwithstanding the preceding paragraph, any such Guarantee by a
Subsidiary of the Notes must provide by its terms that it will be automatically
and unconditionally released and discharged upon any sale, exchange or transfer,
to any Person not an Affiliate of the Company, of all of the Company's stock in,
or all or substantially all the assets of, such Subsidiary, which sale, exchange
or transfer is made in compliance with the applicable provisions of this
Indenture. The form of such Note Guarantee is attached as Exhibit E hereto.

Section 4.19  Limitation on Designation of Restricted and Unrestricted
              Subsidiaries.

         The Board of Directors of the Company may designate any Restricted
Subsidiary to be an Unrestricted Subsidiary if that designation would not cause
a Default. If a Restricted Subsidiary is designated as an Unrestricted
Subsidiary, the aggregate fair market value of all outstanding Investments owned
by the Company and its Restricted Subsidiaries in the Subsidiary properly
designated will be deemed to be an Investment made as of the time of the
designation and will reduce the amount available for (1) Restricted Payments
under Section 4.07(a) hereof or (2) reduce the amount available for future
investments under one or more clauses of the definition of Permitted
Investments, as determined by the Company. That designation will only be
permitted if the Investment would be permitted at that time and if the
Restricted Subsidiary otherwise meets the definition of an Unrestricted
Subsidiary. The Board of Directors of the Company may redesignate any
Unrestricted Subsidiary to be a Restricted Subsidiary if the redesignation would
not cause a Default. Upon any such redesignation or other designation as a

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Restricted Subsidiary, such Subsidiary will become a Guarantor and execute a
supplemental indenture if so required under Section 4.18.

Section 4.20  Payments for Consent.

         The Company will not, and will not permit any of its Restricted
Subsidiaries to, directly or indirectly, pay or cause to be paid any
consideration to or for the benefit of any Holder of Notes for or as an
inducement to any consent, waiver or amendment of any of the terms or provisions
of this Indenture or the Notes unless such consideration is offered to be paid
and is paid to all Holders of the Notes that consent, waive or agree to amend in
the time frame set forth in the solicitation documents relating to such consent,
waiver or agreement.

                                   ARTICLE 5.
                                   SUCCESSORS

Section 5.01  Merger, Consolidation, or Sale of Assets.

         The Company shall not, directly or indirectly consolidate or merge with
or into another Person (whether or not the Company is the surviving
corporation), or sell, assign, transfer, convey or otherwise dispose of all or
substantially all of the properties or assets of the Company and its
Subsidiaries taken as a whole, in one or more related transactions, to another
Person; unless:

              (1) either:

                  (a) the Company is the surviving corporation; or

                  (b) the Person formed by or surviving any such
              consolidation or merger (if other than the Company) or to which
              such sale, assignment, transfer, conveyance or other disposition
              has been made is a corporation organized or existing under the
              laws of the United States, any state of the United States or the
              District of Columbia;

              (2) the Person formed by or surviving any such consolidation or
       merger (if other than the Company) or the Person to which such sale,
       assignment, transfer, conveyance or other disposition has been made
       assumes all the obligations of the Company under the Notes, this
       Indenture and the Registration Rights Agreement pursuant to agreements
       reasonably satisfactory to the Trustee;

              (3) immediately after such transaction, no Default or Event of
       Default exists; and

              (4) the Company or the Person formed by or surviving any such
       consolidation or merger (if other than the Company), or to which such
       sale, assignment, transfer, conveyance or other disposition has been made
       will, on the date of such transaction after giving pro forma effect
       thereto and any related financing transactions as if the same had
       occurred at the beginning of the applicable four-quarter period,

                  (a) have a Fixed Charge Coverage Ratio equal to or greater
       than the Fixed Charge Coverage Ratio of the Company immediately before
       the transaction or

                  (b) be permitted to incur at least $1.00 of additional
       Indebtedness pursuant to the Fixed Charge Coverage Ratio test set forth
       in Section 4.09(a) hereof.

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<PAGE>

         In addition, the Company will not, directly or indirectly, lease all or
substantially all of its properties or assets, in one or more related
transactions, to any other Person. This Section 5.01 will not apply to a sale,
assignment, transfer, conveyance or other disposition of assets between or among
the Company and any of its Wholly-Owned Restricted Subsidiaries.

Section 5.02  Successor Corporation Substituted.

         Upon any consolidation or merger, or any sale, assignment, transfer,
lease, conveyance or other disposition of all or substantially all of the assets
of the Company in a transaction that is subject to, and that complies with the
provisions of, Section 5.01 hereof, the successor corporation formed by such
consolidation or into or with which the Company is merged or to which such sale,
assignment, transfer, lease, conveyance or other disposition is made shall
succeed to, and be substituted for (so that from and after the date of such
consolidation, merger, sale, lease, conveyance or other disposition, the
provisions of this Indenture referring to the "Company" shall refer instead to
the successor corporation and not to the Company), and may exercise every right
and power of the Company under this Indenture with the same effect as if such
successor Person had been named as the Company herein; provided, however, that
the predecessor Company shall not be relieved from the obligation to pay the
principal of and interest on the Notes except in the case of a sale of all of
the Company's assets in a transaction that is subject to, and that complies with
the provisions of, Section 5.01 hereof.

                                   ARTICLE 6.
                              DEFAULTS AND REMEDIES

Section 6.01  Events of Default.

         Each of the following is an Event of Default:

              (1) default for 30 days in the payment when due of interest on, or
       Liquidated Damages with respect to, the Notes whether or not prohibited
       by the subordination provisions of this Indenture;

              (2) default in payment when due of the principal of, or premium,
       if any, on the Notes, whether or not prohibited by the subordination
       provisions of this Indenture;

              (3) failure by the Company or any of its Subsidiaries to comply
       with Section 4.14 or 5.01 hereof;

              (4) failure by the Company or any of its Subsidiaries for 60 days
       after written notice from the Trustee or the Holders of at least 25% in
       principal amount of Notes then outstanding to observe, perform or comply
       with any of the other covenant, representation, warranty or other
       agreement in this Indenture or the Notes;

              (5) default under any mortgage, indenture or instrument under
       which there may be issued or by which there may be secured or evidenced
       any Indebtedness for money borrowed by the Company or any of its
       Subsidiaries (or the payment of which is guaranteed by the Company or any
       of its Subsidiaries) whether such Indebtedness or guarantee now exists,
       or is created after the date of this Indenture, if that default (a) is
       caused by a failure to pay at final maturity (within the grace period
       provided in such Indebtedness) principal, interest or premium in an
       aggregate amount of $5.0 million or more with respect to such
       Indebtedness or (b) results in the acceleration of any such Indebtedness
       aggregating $5.0 million or more, which default or acceleration shall not
       be cured, waived or postponed pursuant to an agreement with the holders
       of such

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<PAGE>

       Indebtedness within 60 days after written notice, or such acceleration
       shall not be rescinded or annulled within 20 days after written notice;

              (6) a final judgment or final judgments for the payment of money
       are entered by a court or courts of competent jurisdiction against the
       Company or any of its Subsidiaries which judgment or judgments are not
       paid, discharged or stayed for a period of 60 days; provided that the
       aggregate of all such undischarged judgments exceeds $10.0 million;

              (7) the Company or any of its Significant Subsidiaries or any
       group of Subsidiaries that, taken as a whole, would constitute a
       Significant Subsidiary pursuant to or within the meaning of Bankruptcy
       Law:

                  (a) commences a voluntary case,

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

                  (c) consents to the appointment of a custodian of it or for
       all or substantially all of its property,

                  (d) makes a general assignment for the benefit of its
       creditors, or

                  (e) generally is not paying its debts as they become due; or

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

                  (a) is for relief against the Company or any of its
       Significant Subsidiaries or any group of Subsidiaries that, taken as a
       whole, would constitute a Significant Subsidiary in an involuntary case;

                  (b) appoints a custodian of the Company or any of its
       Significant Subsidiaries or any group of Subsidiaries that, taken as a
       whole, would constitute a Significant Subsidiary or for all or
       substantially all of the property of the Company or any of its
       Significant Subsidiaries or any group of Subsidiaries that, taken as a
       whole, would constitute a Significant Subsidiary; or

                  (c) orders the liquidation of the Company or any of its
       Significant Subsidiaries or any group of Subsidiaries that, taken as a
       whole, would constitute a Significant Subsidiary;

       and the order or decree remains unstayed and in effect for 60 consecutive
       days; or

              (9) except as permitted by this Indenture, any Note Guarantee is
       held in any judicial proceeding to be unenforceable or invalid or shall
       cease for any reason to be in full force and effect or any Guarantor, or
       any Person acting on behalf of any Guarantor, shall deny or disaffirm its
       obligations under its Note Guarantee.

Section 6.02  Acceleration.

         In the case of an Event of Default specified in clause (7) or (8) of
Section 6.01 hereof, with respect to the Company, any Restricted Subsidiary that
is a Significant Subsidiary or any group of Restricted Subsidiaries that, taken
together, would constitute a Significant Subsidiary, all outstanding Notes will
become due and payable immediately without further action or notice. If any
other Event of

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<PAGE>

Default occurs and is continuing, the Trustee or the Holders of at least 25% in
principal amount of the then outstanding Notes may declare all the Notes to be
due and payable immediately; provided that so long as any Indebtedness permitted
to be incurred under this Indenture as part of the Senior Credit Facility is
outstanding, no acceleration shall be effective until the earlier of (1) five
Business Days after the giving of written notice to the Company and the
administrative agent under the Senior Credit Facility of the acceleration or (2)
the acceleration of any Indebtedness under the Senior Credit Facility.

         Upon any such declaration, the Notes shall become due and payable
immediately. Notwithstanding the foregoing, if an Event of Default specified in
clause (7) or (8) of Section 6.01 hereof occurs with respect to the Company, any
Restricted Subsidiary that is a Significant Subsidiary or any group of
Subsidiaries that, taken together, would constitute a Significant Subsidiary,
all outstanding Notes shall be due and payable immediately without further
action or notice. The Holders of a majority in aggregate principal amount of the
Notes then outstanding by notice to the Trustee may on behalf of the Holders of
all of the Notes waive any existing Default or Event of Default and its
consequences under this Indenture except a continuing Default or Event of
Default in the payment of interest or Liquidated Damages on, or the principal
of, the Notes.

         In the case of any Event of Default occurring by reason of any willful
action (or inaction) taken (or not taken) by or on behalf of the Company with
the intention of avoiding payment of the premium that the Company would have had
to pay if the Company then had elected to redeem the Notes pursuant to Section
3.07 hereof, then an equivalent premium will also become and be immediately due
and payable, to the extent permitted by law, upon the acceleration of the Notes.
If an Event of Default occurs prior to May 15, 2007, by reason of any willful
action (or inaction) taken (or not taken) by or on behalf of the Company with
the intention of avoiding the prohibition on redemption of the Notes prior to
May 15, 2007, then, upon acceleration of the Notes, an additional premium will
also become immediately due and payable in an amount, for each of the years
beginning on May 15 of the years set forth below, as set forth below (expressed
as a percentage of the principal amount of the Notes on the date of payment that
would otherwise be due but for the provisions of this sentence):

              YEAR                                             PERCENTAGE
              ----                                             ----------
              2002....................................            8.875%
              2003....................................            7.988%
              2004....................................            7.100%
              2005....................................            6.213%
              2006....................................            5.325%

Section 6.03  Other Remedies.

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

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

Section 6.04  Waiver of Past Defaults.

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<PAGE>

         Holders of not less than a majority in aggregate principal amount of
the then outstanding Notes by notice to the Trustee may on behalf of the Holders
of all of the Notes waive an existing Default or Event of Default and its
consequences hereunder, except a continuing Default or Event of Default in the
payment of the principal of, premium and Liquidated Damages, if any, or interest
on, the Notes (including in connection with an offer to purchase); provided,
however, that the Holders of a majority in aggregate principal amount of the
then outstanding Notes may rescind an acceleration and its consequences,
including any related payment default that resulted from such acceleration. Upon
any such waiver, such Default shall cease to exist, and any Event of Default
arising therefrom shall be deemed to have been cured for every purpose of this
Indenture; but no such waiver shall extend to any subsequent or other Default or
impair any right consequent thereon.

Section 6.05  Control by Majority.

         Holders of Notes may not enforce the Notes or this Indenture except as
provided in this Indenture. Holders of a majority in principal amount of the
then outstanding Notes may direct the time, method and place of conducting any
proceeding for exercising any remedy available to the Trustee or exercising any
trust or power conferred on it. However, the Trustee may refuse to follow any
direction that conflicts with law or this Indenture that the Trustee determines
may be unduly prejudicial to the rights of other Holders of Notes or that may
involve the Trustee in personal liability.

Section 6.06  Limitation on Suits.

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

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

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

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

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

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

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

Section 6.07  Rights of Holders of Notes to Receive Payment.

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

Section 6.08  Collection Suit by Trustee.

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<PAGE>

         If an Event of Default specified in Section 6.01(1) or (2) occurs and
is continuing, the Trustee is authorized to recover judgment in its own name and
as trustee of an express trust against the Company for the whole amount of
principal of, premium and Liquidated Damages, if any, and interest remaining
unpaid on the Notes and interest on overdue principal and, to the extent lawful,
interest and such further amount as shall be sufficient to cover the costs and
expenses of collection, including the reasonable compensation, expenses,
disbursements and advances of the Trustee, its agents and counsel.

Section 6.09  Trustee May File Proofs of Claim.

         The Trustee is authorized to file such proofs of claim and other papers
or documents as may be necessary or advisable in order to have the claims of the
Trustee (including any claim for the reasonable compensation, expenses,
disbursements and advances of the Trustee, its agents and counsel) and the
Holders of the Notes allowed in any judicial proceedings relative to the Company
(or any other obligor upon the Notes), its creditors or its property and shall
be entitled and empowered to collect, receive and distribute any money or other
property payable or deliverable on any such claims and any custodian in any such
judicial proceeding is hereby authorized by each Holder to make such payments to
the Trustee, and in the event that the Trustee shall consent to the making of
such payments directly to the Holders, to pay to the Trustee any amount due to
it for the reasonable compensation, expenses, disbursements and advances of the
Trustee, its agents and counsel, and any other amounts due the Trustee under
Section 7.07 hereof. To the extent that the payment of any such compensation,
expenses, disbursements and advances of the Trustee, its agents and counsel, and
any other amounts due the Trustee under Section 7.07 hereof out of the estate in
any such proceeding, shall be denied for any reason, payment of the same shall
be secured by a Lien on, and shall be paid out of, any and all distributions,
dividends, money, securities and other properties that the Holders may be
entitled to receive in such proceeding whether in liquidation or under any plan
of reorganization or arrangement or otherwise. Nothing herein contained shall be
deemed to authorize the Trustee to authorize or consent to or accept or adopt on
behalf of any Holder any plan of reorganization, arrangement, adjustment or
composition affecting the Notes or the rights of any Holder, or to authorize the
Trustee to vote in respect of the claim of any Holder in any such proceeding.

Section 6.10  Priorities.

         If the Trustee collects any money pursuant to this Article 6, it shall
pay out the money in the following order:

                  First: to the Trustee, its agents and attorneys for amounts
         due under Section 7.07 hereof, including payment of all compensation,
         expense and liabilities incurred, and all advances made, by the Trustee
         and the costs and expenses of collection;

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

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

         The Trustee may fix a record date and payment date for any payment to
Holders of Notes pursuant to this Section 6.10 upon five Business Days prior
notice to the Company.

Section 6.11  Undertaking for Costs.

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<PAGE>

         In any suit for the enforcement of any right or remedy under this
Indenture or in any suit against the Trustee for any action taken or omitted by
it as a Trustee, a court in its discretion may require the filing by any party
litigant in the suit of an undertaking to pay the costs of the suit, and the
court in its discretion may assess reasonable costs, including reasonable
attorneys' fees, against any party litigant in the suit, having due regard to
the merits and good faith of the claims or defenses made by the party litigant.
This Section 6.11 does not apply to a suit by the Trustee, a suit by a Holder of
a Note pursuant to Section 6.07 hereof, or a suit by Holders of more than 10% in
principal amount of the then outstanding Notes.

                                   ARTICLE 7.
                                     TRUSTEE

Section 7.01  Duties of Trustee.

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

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

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

            (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. However, the
                  Trustee will examine the certificates and opinions to
                  determine whether or not they conform to the requirements of
                  this Indenture.

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

            (1)   this paragraph does not limit the effect of paragraph (b) of
                  this Section 7.01;

            (2)   the Trustee will 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 will not be liable with respect to any action it
                  takes or omits to take in good faith in accordance with a
                  direction received by it pursuant to Section 6.05 hereof.

         (d) Whether or not therein expressly so provided, every provision of
this Indenture that in any way relates to the Trustee is subject to paragraphs
(a), (b), and (c) of this Section 7.01.

         (e) No provision of this Indenture will require the Trustee to expend
or risk its own funds or incur any financial liability in the performance of any
of its rights or powers if it has reasonable grounds to believe that repayment
of such funds or adequate indemnity satisfactory to it against such risk or
liability is not reasonably assured to it. The Trustee will be under no
obligation to exercise any of its

                                       63
<PAGE>

rights and powers under this Indenture at the request of any Holders, unless
such Holder has offered to the Trustee security and indemnity satisfactory to it
against any loss, liability or expense.

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

Section 7.02  Rights of Trustee.

         (a) The Trustee may conclusively rely upon any document believed by it
to be genuine and to have been signed or presented by the proper Person. The
Trustee need not investigate any fact or matter stated in the document.

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

         (c) The Trustee may act through its attorneys and agents and will not
be responsible for the misconduct or negligence of any agent (other than an
agent that is an employee of the Trustee) appointed with due care.

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

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

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

Section 7.03  Individual Rights of Trustee.

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

Section 7.04  Trustee's Disclaimer.

         The Trustee will not be responsible for and makes no representation as
to the validity or adequacy of this Indenture or the Notes, it shall not be
accountable for the Company's use of the proceeds from the Notes or any money
paid to the Company or upon the Company's direction under any provision of this
Indenture, it will not be responsible for the use or application of any money
received by any Paying Agent other than the Trustee, and it will not be
responsible for any statement or recital herein or any statement in

                                       64
<PAGE>

the Notes or any other document in connection with the sale of the Notes or
pursuant to this Indenture other than its certificate of authentication.

Section 7.05  Notice of Defaults.

         If a Default or Event of Default occurs and is continuing and if it is
known to the Trustee, the Trustee will mail to Holders of Notes a notice of the
Default or Event of Default within 90 days after it occurs. Except in the case
of a Default or Event of Default in payment of principal or interest or
Liquidated Damages, if any, on any Note, the Trustee may withhold the notice if
and so long as a committee of its Responsible Officers in good faith determines
that withholding the notice is in the interests of the Holders of the Notes.

Section 7.06  Reports by Trustee to Holders of the Notes.

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

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

Section 7.07  Compensation and Indemnity.

         (a) The Company will pay to the Trustee from time to time reasonable
compensation for its acceptance of this Indenture and services hereunder. The
Trustee's compensation will not be limited by any law on compensation of a
trustee of an express trust. The Company will reimburse the Trustee promptly
upon request for all reasonable disbursements, advances and out-of-pocket
expenses incurred or made by it in addition to the compensation for its services
except such disbursements, expenses and advances as may be attributable to the
Trustee's gross negligence, bad faith or willful misconduct. Such expenses will
include the reasonable compensation, disbursements and out-of-pocket expenses of
the Trustee's agents and counsel.

         (b) The Company and the Guarantors will indemnify the Trustee against
any and all losses, liabilities or expenses incurred by it arising out of or in
connection with the acceptance or administration of its duties under this
Indenture, including the costs and expenses of enforcing this Indenture against
the Company and the Guarantors (including this Section 7.07) and defending
itself against any claim (whether asserted by the Company, the Guarantors or any
Holder or any other Person) or liability in connection with the exercise or
performance of any of its powers or duties hereunder, except to the extent any
such loss, liability or expense may be attributable to its gross negligence or
bad faith. The Trustee will notify the Company promptly of any claim for which
it may seek indemnity. Failure by the Trustee to so notify the Company will not
relieve the Company or any of the Guarantors of their obligations hereunder. The
Company or such Guarantor will defend the claim and the Trustee will cooperate
in the defense. The Trustee may have separate counsel and the Company will pay
the reasonable fees and expenses of such counsel. Neither the Company nor any
Guarantor need pay for any settlement made without its consent, which consent
will not be unreasonably withheld.

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         (c) The obligations of the Company and the Guarantors under this
Section 7.07 will survive the satisfaction and discharge of this Indenture.

         (d) To secure the Company's payment obligations in this Section 7.07,
the Trustee will have a Lien prior to the Notes on all money or property held or
collected by the Trustee, except that held in trust to pay principal and
interest on particular Notes. Such Lien will survive the satisfaction and
discharge of this Indenture.

         (e) When the Trustee incurs expenses or renders services after an Event
of Default specified in Section 6.01(7) or (8) hereof occurs, the expenses and
the compensation for the services (including the fees and expenses of its agents
and counsel) are intended to constitute expenses of administration under any
Bankruptcy Law.

         (f) The Trustee will comply with the provisions of TIA ss. 313(b)(2) to
the extent applicable.

Section 7.08  Replacement of Trustee.

         (a) A resignation or removal of the Trustee and appointment of a
successor Trustee will become effective only upon the successor Trustee's
acceptance of appointment as provided in this Section 7.08.

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

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

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

            (3)   a custodian or public officer takes charge of the Trustee or
                  its property; or

            (4)   the Trustee becomes incapable of acting.

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

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

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

         (f) A successor Trustee will deliver a written acceptance of its
appointment to the retiring Trustee and to the Company. Thereupon, the
resignation or removal of the retiring Trustee will become effective, and the
successor Trustee will have all the rights, powers and duties of the Trustee
under this

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Indenture. The successor Trustee will mail a notice of its succession to
Holders. The retiring Trustee will promptly transfer all property held by it as
Trustee to the successor Trustee, provided all sums owing to the Trustee
hereunder have been paid and subject to the Lien provided for in Section 7.07
hereof. Notwithstanding replacement of the Trustee pursuant to this Section
7.08, the Company's obligations under Section 7.07 hereof will continue for the
benefit of the retiring Trustee.

Section 7.09  Successor Trustee by Merger, etc.

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

Section 7.10  Eligibility; Disqualification.

         There will at all times be a Trustee hereunder that is a corporation
organized and doing business under the laws of the United States of America or
of any state thereof that is authorized under such laws to exercise corporate
trustee power, that is subject to supervision or examination by federal or state
authorities and that has a combined capital and surplus of at least $100 million
as set forth in its most recent published annual report of condition.

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

Section 7.11  Preferential Collection of Claims Against Company.

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

                                   ARTICLE 8.
                    LEGAL DEFEASANCE AND COVENANT DEFEASANCE

Section 8.01  Option to Effect Legal Defeasance or Covenant Defeasance.

         The Company may, at the option of its Board of Directors evidenced by a
resolution set forth in an Officers' Certificate, at any time, elect to have
either Section 8.02 or 8.03 hereof be applied to all outstanding Notes upon
compliance with the conditions set forth below in this Article 8.

Section 8.02  Legal Defeasance and Discharge.

         Upon the Company's exercise under Section 8.01 hereof of the option
applicable to this Section 8.02, the Company and each of the Guarantors will,
subject to the satisfaction of the conditions set forth in Section 8.04 hereof,
be deemed to have been discharged from their obligations with respect to all
outstanding Notes (including the Note Guarantees) on the date the conditions set
forth below are satisfied (hereinafter, "Legal Defeasance"). For this purpose,
Legal Defeasance means that the Company and the Guarantors will be deemed to
have paid and discharged the entire Indebtedness represented by the outstanding
Notes (including the Note Guarantees), which will thereafter be deemed to be
"outstanding" only for the purposes of Section 8.05 hereof and the other
Sections of this Indenture referred to in clauses (1) and (2) below, and to have
satisfied all their other obligations under such Notes, the Note Guarantees and
this Indenture (and the Trustee, on demand of and at the expense of the Company,
shall execute

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proper instruments acknowledging the same), except for the following provisions
which will survive until otherwise terminated or discharged hereunder:

            (1)   the rights of Holders of outstanding Notes to receive payments
                  in respect of the principal of, or interest or premium and
                  Liquidated Damages, if any, on such Notes when such payments
                  are due from the trust referred to in Section 8.04 hereof;

            (2)   the Company's obligations with respect to such Notes under
                  Article 2 and Section 4.02 hereof;

            (3)   the rights, powers, trusts, duties and immunities of the
                  Trustee hereunder and the Company's and the Guarantors'
                  obligations in connection therewith; and

            (4)   this Article 8.

         Upon Legal Defeasance the Trustee shall promptly execute and deliver to
the Company any documents reasonably requested by the Company to evidence or
effect the foregoing. Subject to Compliance with this Article 8, the Company may
exercise its option under this Section 8.02 notwithstanding the prior exercise
of its option under Section 8.03 hereof.

Section 8.03  Covenant Defeasance.

         Upon the Company's exercise under Section 8.01 hereof of the option
applicable to this Section 8.03, the Company and the Guarantors will, subject to
the satisfaction of the conditions set forth in Section 8.04 hereof, be released
from each of their obligations under the covenants contained in Sections 3.09,
4.03, 4.07, 4.08, 4.09, 4.10, 4.11, 4.12, 4.13, 4.14, 4.15, 4.16, 4.17, 4.18,
4.19 and 4.20 hereof and clause (4) of Section 5.01 hereof with respect to the
outstanding Notes on and after the date the conditions set forth in Section 8.04
hereof are satisfied (hereinafter, "Covenant Defeasance"), and the Notes will
thereafter be deemed not "outstanding" for the purposes of any direction,
waiver, consent or declaration or act of Holders (and the consequences of any
thereof) in connection with such covenants, but will continue to be deemed
"outstanding" for all other purposes hereunder (it being understood that such
Notes will not be deemed outstanding for accounting purposes). For this purpose,
Covenant Defeasance means that, with respect to the outstanding Notes and Note
Guarantees, the Company and the Guarantors may omit to comply with and will 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 will not constitute a Default or an Event of Default under
Section 6.01 hereof, but, except as specified above, the remainder of this
Indenture and such Notes and Note Guarantees will be unaffected thereby. In
addition, upon the Company's exercise under Section 8.01 hereof of the option
applicable to this Section 8.03 hereof, subject to the satisfaction of the
conditions set forth in Section 8.04 hereof, Sections 6.01(3) through 6.01(5)
hereof will not constitute Events of Default.

Section 8.04  Conditions to Legal or Covenant Defeasance.

         In order to exercise either Legal Defeasance or Covenant Defeasance
under either Section 8.02 or 8.03 hereof:

                  (1) the Company shall have irrevocably deposited or caused to
         be deposited with the Trustee, in trust, for the benefit of the Holders
         of the Notes, cash in United States dollars, non-

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<PAGE>

         callable Government Securities, or a combination of cash in United
         States dollars and non-callable Government Securities, in amounts as
         will be sufficient, in the opinion of a nationally recognized firm of
         independent public accountants or of a nationally recognized investment
         bank, to pay the principal of, or interest and premium and Liquidated
         Damages, if any, on the outstanding Notes on the stated maturity or on
         the applicable redemption date, as the case may be, and the Company
         must specify whether the Notes are being defeased to maturity or to a
         particular redemption date. The Trustee shall promptly advise the
         Paying Agent in writing of any deposit pursuant to this Section 8.04;

                  (2) in the case of an election under Section 8.02 hereof, the
         Company shall have delivered to the Trustee an Opinion of Counsel
         confirming that

                           (A) the Company has received from, or there has been
                  published by, the Internal Revenue Service a ruling or

                           (B) since the date of this Indenture, there has been
                  a change in the applicable federal income tax law,

         in either case to the effect that, and based thereon such Opinion of
         Counsel will 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 Legal Defeasance and will be subject to federal income
         tax on the same amounts, in the same manner and at the same times as
         would have been the case if such Legal Defeasance had not occurred;

                  (3) in the case of an election under Section 8.03 hereof, the
         Company shall have delivered to the Trustee an Opinion of Counsel
         reasonably acceptable to the Trustee confirming 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;

                  (4) no Default or Event of Default shall have occurred and be
         continuing on the date of such deposit (other than a Default or Event
         of Default resulting from the borrowing of funds to be applied to such
         deposit) or, insofar as Events of Default from bankruptcy or insolvency
         events are concerned, at any time in the period ending on the 91st day
         after the date of deposit;

                  (5) such Legal Defeasance or Covenant Defeasance will 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 Company or any of its Subsidiaries is a party or by which the
         Company or any of its Subsidiaries is bound;

                  (6) the Company shall have delivered to the Trustee an
         Officers' Certificate stating that the deposit was not made by the
         Company with the intent of preferring the Holders of Notes over the
         other creditors of the Company with the intent of defeating, hindering,
         delaying or defrauding creditors of the Company or others; and

                  (7) the Company shall have delivered to the Trustee an
         Officers' Certificate and an Opinion of Counsel, each stating that all
         conditions precedent relating to the Legal Defeasance or the Covenant
         Defeasance have been complied with.

Section 8.05  Deposited Money and Government Securities to be Held in Trust;
              Other Miscellaneous Provisions.

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<PAGE>

         Subject to Section 8.06 hereof, all money and non-callable Government
Securities (including the proceeds thereof) deposited with the Trustee (or other
qualifying trustee, collectively for purposes of this Section 8.05, the
"Trustee") pursuant to Section 8.04 hereof in respect of the outstanding Notes
will 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 Company acting as Paying Agent) as the
Trustee may determine, to the Holders of such Notes of all sums due and to
become due thereon in respect of principal, premium and Liquidated Damages, if
any, and interest, but such money need not be segregated from other funds except
to the extent required by law.

         The Company will pay and indemnify the Trustee against any tax, fee or
other charge imposed on or assessed against the cash or non-callable Government
Securities deposited pursuant to Section 8.04 hereof or the principal and
interest received in respect thereof other than any such tax, fee or other
charge which by law is for the account of the Holders of the outstanding Notes.

         Notwithstanding anything in this Article 8 to the contrary, the Trustee
will deliver or pay to the Company from time to time upon the request of the
Company any money or non-callable Government Securities held by it as provided
in Section 8.04 hereof which, in the opinion of a nationally recognized firm of
independent public accountants expressed in a written certification thereof
delivered to the Trustee (which may be the opinion delivered under Section
8.04(1) hereof), are in excess of the amount thereof that would then be required
to be deposited to effect an equivalent Legal Defeasance or Covenant Defeasance.

Section 8.06  Repayment to Company.

         Any money deposited with the Trustee or any Paying Agent, or then held
by the Company, in trust for the payment of the principal of, premium or
Liquidated Damages, if any, or interest on any Note and remaining unclaimed for
two years after such principal, premium or Liquidated Damages, if any, or
interest has become due and payable shall be paid to the Company on its request
or (if then held by the Company) will be discharged from such trust; and the
Holder of such Note will thereafter, as an unsecured general creditor, be
permitted to look only to the Company for payment thereof, and all liability of
the Trustee or such Paying Agent with respect to such trust money, and all
liability of the Company as trustee thereof, will 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 Company cause to be published
once, in The New York Times and The Wall Street Journal (national edition),
notice that such money remains unclaimed and that, after a date specified
therein, which will not be less than 30 days from the date of such notification
or publication, any unclaimed balance of such money then remaining will be
repaid to the Company.

Section 8.07  Reinstatement.

         If the Trustee or Paying Agent is unable to apply any United States
dollars or non-callable Government Securities in accordance with Section 8.02 or
8.03 hereof, as the case may be, by reason of any order or judgment of any court
or governmental authority enjoining, restraining or otherwise prohibiting such
application, then the Company's and each Guarantor's obligations under this
Indenture and the Notes and the Note Guarantees will be revived and reinstated
as though no deposit had occurred pursuant to Section 8.02 or 8.03 hereof until
such time as the Trustee or Paying Agent is permitted to apply all such money in
accordance with Section 8.02 or 8.03 hereof, as the case may be; provided,
however, that, if the Company makes any payment of principal of, premium or
Liquidated Damages, if any, or interest on any Note following the reinstatement
of its obligations, the Company will 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.

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                                   ARTICLE 9.
                        AMENDMENT, SUPPLEMENT AND WAIVER

Section 9.01  Without Consent of Holders of Notes.

         Notwithstanding Section 9.02 of this Indenture, the Company, the
Guarantors and the Trustee may amend or supplement this Indenture, the Note
Guarantees or the Notes without the consent of any Holder of a Note:

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

                  (2)   to provide for uncertificated Notes in addition to or in
                        place of certificated Notes or to alter the provisions
                        of Article 2 hereof (including the related definitions)
                        in a manner that does not materially adversely affect
                        any Holder;

                  (3)   to provide for the assumption of the Company's or a
                        Guarantor's obligations to the Holders of the Notes by a
                        successor to the Company pursuant to Article 5 hereof;

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

                  (5)   to comply with requirements of the SEC in order to
                        effect or maintain the qualification of this Indenture
                        under the TIA;

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

                  (7)   to allow any Guarantor to execute a supplemental
                        indenture and/or a Note Guarantee with respect to the
                        Notes.

         Upon the request of the Company accompanied by a resolution of its
Board of Directors authorizing the execution of any such amended or supplemental
Indenture, and upon receipt by the Trustee of the documents described in Section
7.02 hereof, the Trustee will join with the Company and the Guarantors in the
execution of any amended or supplemental Indenture authorized or permitted by
the terms of this Indenture and to make any further appropriate agreements and
stipulations that may be therein contained, but the Trustee will not be
obligated to enter into such amended or supplemental Indenture that affects its
own rights, duties or immunities under this Indenture or otherwise.

Section 9.02  With Consent of Holders of Notes.

         Except as provided below in this Section 9.02, the Company and the
Trustee may amend or supplement this Indenture (including, without limitation,
Sections 3.09, 4.10 and 4.14 hereof), the Note Guarantees and the Notes with the
consent of the Holders of at least a majority in principal amount of the Notes
(including, without limitation, Additional Notes, if any) then outstanding
voting as a single class (including, without limitation, consents obtained in
connection with a tender offer or exchange offer for, or purchase of, the
Notes), and, subject to Sections 6.04 and 6.07 hereof, any existing Default or
Event of Default (other than a Default or Event of Default in the payment of the
principal of, premium or Liquidated Damages, if any, or interest on the Notes,
except a payment default resulting from an acceleration that has been rescinded)
or compliance with any provision of this Indenture, the Note Guarantees or the
Notes may be waived with the consent of the Holders of a majority in principal
amount of the then outstanding Notes voting as a single class (including
consents obtained in connection with a

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<PAGE>

tender offer or exchange offer for, or purchase of, the Notes). Without the
consent of at least 75% in aggregate principal amount of the Notes then
outstanding, no waiver or amendment to this Indenture may make any change in the
provisions of Article 10 hereof that adversely affects the rights of any Holder
of Notes. Section 2.08 hereof shall determine which Notes are considered to be
"outstanding" for purposes of this Section 9.02.

         Upon the request of the Company accompanied by a resolution of its
Board of Directors authorizing the execution of any such amended or supplemental
Indenture, and upon the filing with the Trustee of evidence satisfactory to the
Trustee of the consent of the Holders of Notes as aforesaid, and upon receipt by
the Trustee of the documents described in Section 7.02 hereof, the Trustee will
join with the Company in the execution of such amended or supplemental Indenture
unless such amended or supplemental Indenture directly affects the Trustee's own
rights, duties or immunities under this Indenture or otherwise, in which case
the Trustee may in its discretion, but will not be obligated to, enter into such
amended or supplemental Indenture.

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

         After an amendment, supplement or waiver under this Section 9.02
becomes effective, the Company will mail to the Holders of Notes affected
thereby a notice briefly describing the amendment, supplement or waiver. Any
failure of the Company to mail such notice, or any defect therein, will not,
however, in any way impair or affect the validity of any such amended or
supplemental Indenture or waiver. Subject to Sections 6.04 and 6.07 hereof, the
Holders of a majority in aggregate principal amount of the Notes then
outstanding voting as a single class may waive compliance in a particular
instance by the Company with any provision of this Indenture or the Notes.
However, without the consent of each Holder affected, an amendment or waiver
under this Section 9.02 may not (with respect to any Notes held by a
non-consenting Holder):

            (1) reduce the principal amount of Notes whose Holders must consent
      to an amendment, supplement or waiver;

            (2) reduce the principal of or change the fixed maturity of any Note
      or alter or waive any of the provisions with respect to the redemption of
      the Notes (other than the 30-day prior notice requirement described in
      Section 3.07(c) hereto and as provided above with respect to Sections
      3.09, 4.10 and 4.14 hereof);

            (3) reduce the rate of or change the time for payment of interest
      including default interest, on any Note;

            (4) waive a Default or Event of Default in the payment of principal
      of, or interest or premium, or Liquidated Damages, if any, on the Notes
      (except a rescission of acceleration of the Notes by the Holders of at
      least a majority in aggregate principal amount of the then outstanding
      Notes and a waiver of the payment default that resulted from such
      acceleration);

            (5) make any Note payable in money other than that stated in the
      Notes;

            (6) make any change in the provisions of this Indenture relating to
      waivers of past Defaults or the rights of Holders of Notes to receive
      payments of principal of, or interest or premium or Liquidated Damages, if
      any, on the Notes;

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<PAGE>

            (7) waive a redemption payment with respect to any Note (other than
      a payment required by Sections 3.09, 4.10 or 4.14 hereof);

            (8) release any Guarantor from any of its obligations under its Note
      Guarantee or this Indenture, except in accordance with the terms of this
      Indenture; or

            (9) make any change in the foregoing amendment and waiver
      provisions.

Section 9.03  Compliance with Trust Indenture Act.

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

Section 9.04  Revocation and Effect of Consents.

         Until an amendment, supplement or waiver becomes effective, a consent
to it by a Holder of a Note is a continuing consent by the Holder of a Note and
every subsequent Holder of a Note or portion of a Note that evidences the same
debt as the consenting Holder's Note, even if notation of the consent is not
made on any Note. However, any such Holder of a Note or subsequent Holder of a
Note may revoke the consent as to its Note if the Trustee receives written
notice of revocation before the date the waiver, supplement or amendment becomes
effective. After an amendment, supplement or waiver becomes effective, it shall
bind every Holder, unless it makes a change described in clauses (1) through (9)
of the last paragraph of Section 9.02, in which case, the amendment, supplement
or waiver shall bind only each Holder of Notes who has consented to it and every
subsequent Holder of Notes or portion of Notes that evidences the same
Indebtedness as the consenting Holder's Notes.

Section 9.05  Notation on or Exchange of Notes.

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

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

Section 9.06  Trustee to Sign Amendments, etc.

         The Trustee will sign any amended or supplemental Indenture authorized
pursuant to this Article 9 if the amendment or supplement does not adversely
affect the rights, duties, liabilities or immunities of the Trustee. The Company
may not sign an amendment or supplemental Indenture until the Board of Directors
approves it. In executing any amended or supplemental indenture, the Trustee
will be entitled to receive and (subject to Section 7.01 hereof) will be fully
protected in relying upon, in addition to the documents required by Section
13.04 hereof, an Officers' Certificate and an Opinion of Counsel stating that
the execution of such amended or supplemental Indenture is authorized or
permitted by this Indenture.

                                  ARTICLE 10.
                                  SUBORDINATION

Section 10.01  Notes Subordinate to Senior Debt.

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<PAGE>

         The Company covenants and agrees, and each Holder of Notes, by its
acceptance thereof, likewise covenants and agrees, that, to the extent and in
the manner hereinafter set forth in this Article 10, the Indebtedness
represented by the Notes and the payment of the principal of, premium, if any,
and interest on, and Liquidated Damages with respect to, the Notes are hereby
expressly made subordinate and subject in right of payment as provided in this
Article 10 to the prior payment in full in cash of all Senior Debt.

         This Article 10 shall constitute a continuing offer to all Persons who,
in reliance upon such provisions, become holders of or continue to hold Senior
Debt; and such provisions are made for the benefit of the holders of Senior
Debt; and such holders are made obligees hereunder and they or each of them may
enforce such provisions.

         The Notes are hereby expressly made subordinate in right of payment to
Senior Indebtedness (as defined in the 9 7/8% Notes Indenture and the 8 5/8%
Notes Indenture) at least to the same extent as the 9 7/8% Notes and the 8 5/8%
Notes are subordinate to Senior Indebtedness.

Section 10.02  Payment Over of Proceeds upon Dissolution, etc.

         In the event of:

                  (1) any insolvency or bankruptcy case or proceeding, or any
         receivership, liquidation, reorganization or other similar case or
         proceeding in connection therewith, relative to the Company or to its
         creditors, as such, or to its assets, whether voluntary or involuntary,

                  (2) any liquidation, dissolution or other winding-up of the
         Company, whether voluntary or involuntary and whether or not involving
         insolvency or bankruptcy, or

                  (3) any general assignment for the benefit of creditors or any
         other marshalling of assets or liabilities of the Company,

         then and in any such event:

                      (a) the holders of Senior Debt shall be entitled to
         receive payment in full in cash of all amounts due on or in respect of
         all Senior Debt, or provision shall be made for such payment, before
         the Holders of the Notes are entitled to receive any payment or
         distribution of any kind or character on account of principal of,
         premium, if any, or interest on, or Liquidated Damages with respect to,
         the Notes; and

                      (b) any payment or distribution of assets of the Company
         of any kind or character, whether in cash, property or securities, by
         set-off or otherwise, to which the Holders or the Trustee would be
         entitled but for the provisions of this Article 10 shall be paid by the
         liquidating trustee or agent or other Person making such payment or
         distribution, whether a trustee in bankruptcy, a receiver or
         liquidating trustee or otherwise, directly to the holders of Senior
         Debt or their representative or representatives or to the trustee or
         trustees under any indenture under which any instruments evidencing any
         of such Senior Debt may have been issued, ratably according to the
         aggregate amounts remaining unpaid on account of the Senior Debt held
         or represented by each, to the extent necessary to make payment in full
         in cash of all Senior Debt remaining unpaid, after giving effect to any
         concurrent payment or distribution, or provision therefor, to the
         holders of such Senior Debt; and

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<PAGE>

                  (c) in the event that, notwithstanding the foregoing
         provisions of this Section 10.02, the Trustee or the Holder of any Note
         shall have received any payment or distribution of assets of the
         Company of any kind or character, whether in cash, property or
         securities, including, without limitation, by way of set-off or
         otherwise, in respect of principal of, premium, if any, or interest on,
         or Liquidated Damages with respect to, the Notes before all Senior Debt
         is paid in full or payment thereof provided for, then and in such event
         such payment or distribution shall be paid over or delivered forthwith
         to the trustee in bankruptcy, receiver, liquidating trustee, custodian,
         assignee, agent or other Person making payment or distribution of
         assets of the Company for application to the payment of all Senior Debt
         remaining unpaid, to the extent necessary to pay all Senior Debt in
         full in cash after giving effect to any concurrent payment or
         distribution, or provision therefor, to or for the holders of Senior
         Debt.

         The consolidation of the Company with, or the merger of the Company
with or into, another Person or the liquidation or dissolution of the Company
following the conveyance, transfer or lease of its properties and assets
substantially as an entirety to another Person upon the terms and conditions set
forth in Article 5 hereof shall not be deemed a dissolution, winding-up,
liquidation, reorganization, assignment for the benefit of creditors or
marshaling of assets and liabilities of the Company for the purposes of this
Article 10 if the Person formed by such consolidation or the surviving entity of
such merger or the Person which acquires by conveyance, transfer or lease such
properties and assets substantially as an entirety, as the case may be, shall,
as a part of such consolidation, merger, conveyance, transfer or lease, comply
with the conditions set forth in such Article 5 hereof.

Section 10.03  Suspension of Payment When Senior Indebtedness in Default.

         (a) Unless Section 10.02 hereof shall be applicable, after the
occurrence of a Payment Default no payment or distribution of any assets or
securities of the Company or any Subsidiary of any kind or character (including,
without limitation, cash, property and any payment or distribution which may be
payable or deliverable by reason of the payment of any other Indebtedness of the
Company being subordinated to the payment of the Notes by the Company) may be
made by or on behalf of the Company or any Subsidiary, including, without
limitation, by way of set-off or otherwise, for or on account of principal of,
premium, if any, or interest or Liquidated Damages on the Notes, or for or on
account of the purchase, redemption or other acquisition of the Notes, and
neither the Trustee nor any holder or owner of any Notes shall take or receive
from the Company or any Subsidiary, directly or indirectly in any manner,
payment in respect of all or any portion of Notes following the occurrence of a
Payment Default, and in any such event, such prohibition shall continue until
such Payment Default is cured, waived in writing or ceases to exist. At such
time as the prohibition set forth in the preceding sentence shall no longer be
in effect, subject to the provisions of the following paragraph (b), the Company
shall resume making any and all required payments in respect of the Notes,
including any missed payments.

         (b) Unless Section 10.02 hereof shall be applicable, upon the
occurrence of a Non-Payment Event of Default on Designated Senior Debt, no
payment or distribution of any assets of the Company of any kind or character
shall be made by the Company, including, without limitation, by way of set-off
or otherwise, on account of any principal of, premium, if any, or interest on,
or Liquidated Damages with respect to, the Notes or on account of the purchase,
redemption, defeasance or other acquisition of Notes and neither the Trustee nor
any holder or owner of Notes shall take or receive from the Company or any
Subsidiary, directly or indirectly, in any manner, payment in respect of all or
any portion of the Notes for a period ("Payment Blockage Period") commencing on
the date of receipt by the Trustee of written notice from an authorized Person
on behalf of the holders of Designated Senior Debt (the "Authorized Person") of
such Non-Payment Event of Default unless and until (subject to any blockage of
payments that may then be in effect under the preceding paragraph (a)) the
earliest to occur of the following events: (w) more than 179 days shall have
elapsed since the date of receipt of such written notice by the Trustee, (x)
such

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Non-Payment Event of Default shall have been cured or waived in writing or shall
have ceased to exist, (y) such Designated Senior Debt shall have been discharged
or paid in full in cash or (z) such Payment Blockage Period shall have been
terminated by written notice to the Company or the Trustee from such Authorized
Person initiating such Payment Blockage Period, after which, in the case of
clause (w), (x), (y) or (z), the Company shall resume making any and all
required payments in respect of the Notes, including any missed payments.
Notwithstanding any other provisions of this Indenture, no Non-Payment Event of
Default with respect to Designated Senior Debt which existed or was continuing
on the date of the commencement of any Payment Blockage Period initiated by such
Authorized Person shall be, or be made, the basis for the commencement of a
second Payment Blockage Period initiated by such Authorized Person unless such
event of default shall have been cured or waived for a period of not less than
90 consecutive days. In no event shall a Payment Blockage Period extend beyond
179 days from the date of the receipt by the Trustee of the notice referred to
in this Section 10.03(b) (the "Initial Blockage Period"). Any number of
additional Payment Blockage Periods may be commenced during the Initial Blockage
Period; provided, however, that no such additional Payment Blockage Period shall
extend beyond the Initial Blockage Period. After the expiration of the Initial
Blockage Period, no Payment Blockage Period may be commenced under this Section
10.03(b) until at least 180 consecutive days have elapsed from the last day of
the Initial Blockage Period.

         (c) In the event that, notwithstanding the foregoing, the Trustee or
the Holder of any Note shall have received any payment prohibited by the
foregoing provisions of this Section 10.03, then and in such event such payment
shall be paid over and delivered forthwith to the Authorized Person initiating
the Payment Blockage Period, in trust for distribution to the holders of Senior
Debt or, if no amounts are then due in respect of Senior Debt, promptly returned
to the Company, or otherwise as a court of competent jurisdiction shall direct.

Section 10.04  Trustee's Relation to Senior Debt.

         With respect to the holders of Senior Debt, the Trustee undertakes to
perform or to observe only such of its covenants and obligations as are
specifically set forth in this Article 10, and no implied covenants or
obligations with respect to the holders of Senior Debt shall be read into this
Indenture against the Trustee. The Trustee shall not be deemed to owe any
fiduciary duty to the holders of Senior Debt, and the Trustee shall not be
liable to any holder of Senior Debt if it shall mistakenly pay over or deliver
to Holders, the Company or any other Person moneys or assets to which any holder
of Senior Debt shall be entitled by virtue of this Article 10 or otherwise.

Section 10.05  Subrogation to Rights of Holders of Senior Debt.

         Upon the payment in full of all Senior Debt, the Holders of the Notes
shall be subrogated to the rights of the holders of such Senior Debt to receive
payments and distributions of cash, property and securities applicable to the
Senior Debt until the principal of, premium, if any and interest on, or
Liquidated Damages with respect to, the Notes shall be paid in full. For
purposes of such subrogation, no payments or distributions to the holders of
Senior Debt of any cash, property or securities to which the Holders of the
Notes or the Trustee would be entitled except for the provisions of this Article
10, and no payments over pursuant to the provisions of this Article 10 to the
holders of Senior Debt by Holders of the Notes or the Trustee, shall, as among
the Company, its creditors other than holders of Senior Debt and the Holders of
the Notes, be deemed to be a payment or distribution by the Company to or on
account of the Senior Debt.

         If any payment or distribution to which the Holders would otherwise
have been entitled but for the provisions of this Article 10 shall have been
applied, pursuant to the provisions of this Article 10, to the payment of all
amounts payable under the Senior Debt of the Company, then and in such case the

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Holders shall be entitled to receive from the holders of such Senior Debt at the
time outstanding any payments or distributions received by such holders of such
Senior Debt in excess of the amount sufficient to pay all amounts payable under
or in respect of such Senior Debt in full in cash.

Section 10.06  Provisions Solely to Define Relative Rights.

         The provisions of this Article 10 are and are intended solely for the
purpose of defining the relative rights of the Holders of the Notes on the one
hand and the holders of Senior Debt on the other hand. Nothing contained in this
Article or elsewhere in this Indenture or in the Notes is intended to or shall:

(a) impair, as among the Company, its creditors other than holders of Senior
Debt and the Holders of the Notes, the obligation of the Company, which is
absolute and unconditional, to pay to the Holders of the Notes the principal of,
premium, if any, and interest on, or Liquidated Damages with respect to, the
Notes as and when the same shall become due and payable in accordance with their
terms; or

         (b) affect the relative rights against the Company of the Holders of
the Notes and creditors of the Company other than the holders of Senior Debt; or

         (c) prevent the Trustee or the Holder of any Note from exercising all
remedies otherwise permitted by applicable law upon a Default or an Event of
Default under this Indenture, subject to the rights, if any, under this Article
10 of the holders of Senior Debt (1) in any case, proceeding, dissolution,
liquidation or other winding-up, assignment for the benefit of creditors or
other marshaling of assets and liabilities of the Company referred to in Section
10.02 hereof, to receive, pursuant to and in accordance with such Section, cash,
property and securities otherwise payable or deliverable to the Trustee or such
Holder, or (2) under the conditions specified in Section 10.03, to prevent any
payment prohibited by such Section or enforce their rights pursuant to Section
10.03(c) hereof.

         The failure to make a payment on account of principal of, premium, if
any, or interest on, or Liquidated Damages with respect to, the Notes by reason
of any provision of this Article 10 shall not be construed as preventing the
occurrence of a Default or an Event of Default hereunder.

Section 10.07  Trustee to Effectuate Subordination.

         Each Holder of a Note by his acceptance thereof authorizes and directs
the Trustee on his behalf to take such action as may be necessary or appropriate
to effectuate the subordination provided in this Article and appoints the
Trustee his attorney-in-fact for any and all such purposes, including, in the
event of any dissolution, winding-up, liquidation or reorganization of the
Company whether in bankruptcy, insolvency, receivership proceedings, or
otherwise, the timely filing of a claim for the unpaid balance of the
indebtedness of the Company owing to such Holder in the form required in such
proceedings and the causing of such claim to be approved. If the Trustee does
not file such a claim prior to 30 days before the expiration of the time to file
such a claim, the holders of Senior Debt, or any Authorized Person, may file
such a claim on behalf of Holders of the Notes.

Section 10.08  No Waiver of Subordination Provisions.

         (a) No right of any present or future holder of any Senior Debt to
enforce subordination as herein provided shall at any time in any way be
prejudiced or impaired by any act or failure to act on the part of the Company
or by any act or failure to act, in good faith, by any such holder, or by any
non-compliance

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<PAGE>

by the Company with the terms, provisions and covenants of this Indenture,
regardless of any knowledge thereof any such holder may have or be otherwise
charged with.

         (b) Without limiting the generality of subsection (a) of this Section
10.08, the holders of Senior Debt may, at any time and from time to time,
without the consent of or notice to the Trustee or the Holders of the Notes,
without incurring responsibility to the Holders of the Notes and without
impairing or releasing the subordination provided in this Article 10 or the
obligations hereunder of the Holders of the Notes to the holders of Senior Debt,
do any one or more of the following:

                  (1) change the manner, place or terms of payment or extend the
         time of payment of, or renew or alter, Senior Debt or any instrument
         evidencing the same or any agreement under which Senior Debt is
         outstanding;

                  (2) sell, exchange, release or otherwise deal with any
         property pledged, mortgaged or otherwise securing Senior Debt;

                  (3) release any Person liable in any manner for the collection
         or payment of Senior Debt; and

                  (4) exercise or refrain from exercising any rights against the
         Company and any other Person; provided, however, that in no event shall
         any such actions limit the right of the Holders of the Notes to take
         any action to accelerate the maturity of the Notes pursuant to Article
         6 hereof or to pursue any rights or remedies hereunder or under
         applicable laws if the taking of such action does not otherwise violate
         the terms of this Indenture.

Section 10.09  Notice to Trustee.

         (a) The Company shall give prompt written notice to the Trustee of any
fact known to the Company which would prohibit the making of any payment to or
by the Trustee at its Corporate Trust Office in respect of the Notes.
Notwithstanding the provisions of this Article 10 or any other provision of this
Indenture, the Trustee shall not be charged with knowledge of the existence of
any facts which would prohibit the making of any payment to or by the Trustee in
respect of the Notes, unless and until the Trustee shall have received written
notice thereof from the Company or a holder of Senior Debt or from any trustee,
fiduciary or agent therefor; and, prior to the receipt of any such written
notice, the Trustee, subject to the provisions of this Section 10.09, shall be
entitled in all respects to assume that no such facts exist; provided, however,
that if the Trustee shall not have received the notice provided for in this
Section 10.09 at least five Business Days prior to the date upon which by the
terms hereof any money may become payable for any purpose under this Indenture
(including, without limitation, the payment of the principal of, premium, if
any, or interest on, or Liquidated Damages with respect to, any Note), then,
anything herein contained to the contrary notwithstanding but without limiting
the rights and remedies of the holders of Senior Debt or any trustee, fiduciary
or agent therefor, the Trustee shall have full power and authority to receive
such money and to apply the same to the purpose for which such money was
received and shall not be affected by any notice to the contrary which may be
received by it within five Business Days prior to such date; nor shall the
Trustee be charged with knowledge of the curing of any such default or the
elimination of the act or condition preventing any such payment unless and until
the Trustee shall have received an Officers' Certificate to such effect.

         (b) Subject to the provisions of Section 7.01 hereof, the Trustee shall
be entitled to rely on the delivery to it of a written notice to the Trustee and
the Company by a Person representing itself to be a holder of Senior Debt (or a
trustee, fiduciary or agent therefor) to establish that such notice has been
given by a holder of Senior Debt (or a trustee, fiduciary or agent therefor);
provided, however, that failure

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to give such notice to the Company shall not affect in any way the ability of
the Trustee to rely on such notice. In the event that the Trustee determines in
good faith that further evidence is required with respect to the right of any
Person as a holder of Senior Debt to participate in any payment or distribution
pursuant to this Article 10, the Trustee may request such Person to furnish
evidence to the reasonable satisfaction of the Trustee as to the amount of
Senior Debt held by such Person, the extent to which such Person is entitled to
participate in such payment or distribution and any other facts pertinent to the
rights of such Person under this Article 10, and if such evidence is not
furnished, the Trustee may defer any payment to such Person pending judicial
determination as to the right of such Person to receive such payment.

Section 10.10  Reliance on Judicial Order or Certificate of Liquidating Agent.

         Upon any payment or distribution of assets of the Company referred to
in this Article 10, the Trustee, subject to the provisions of Section 7.01
hereof, and the Holders shall be entitled to rely upon any order or decree
entered by any court of competent jurisdiction in which such insolvency,
bankruptcy, receivership, liquidation, reorganization, dissolution, winding-up
or similar case or proceeding is pending, or a certificate of the trustee in
bankruptcy, receiver, liquidating trustee, custodian, assignee for the benefit
of creditors, agent or other Person making such payment or distribution,
delivered to the Trustee or to the Holders, for the purpose of ascertaining the
Persons entitled to participate in such payment or distribution, the holders of
Senior Debt and other Indebtedness of the Company, the amount thereof or payable
thereon, the amount or amounts paid or distributed thereon and all other facts
pertinent thereto or to this Article 10; provided that the foregoing shall apply
only if such court has been fully apprised of the provisions of this Article 10.

Section 10.11  Rights of Trustee as a Holder of Senior Debt; Preservation of
               Trustee's Rights.

         The Trustee in its individual capacity shall be entitled to all the
rights set forth in this Article 10 with respect to any Senior Debt which may at
any time be held by it, to the same extent as any other holder of Senior Debt,
and nothing in this Indenture shall deprive the Trustee of any of its rights as
such holder. Nothing in this Article 10 shall apply to claims of, or payments
to, the Trustee under or pursuant to Section 7.07 hereof.

Section 10.12  Article Applicable to Paying Agents.

         In case at any time any Paying Agent other than the Trustee shall have
been appointed by the Company and be then acting hereunder, the term "Trustee"
as used in this Article 10 shall in such case (unless the context otherwise
requires) be construed as extending to and including such Paying Agent within
its meaning as fully for all intents and purposes as if such Paying Agent were
named in this Article 10 in addition to or in place of the Trustee.

Section 10.13  No Suspension of Remedies.

         Nothing contained in this Article 10 shall limit the right of the
Trustee or the Holders of Notes to take any action to accelerate the maturity of
the Notes pursuant to Article 6 or to pursue any rights or remedies hereunder or
under applicable law, subject to the rights, if any, under this Article 10 of
the holders, from time to time, of Senior Debt.

Section 10.14  Amendments

         Any amendment to, or waiver of, the provisions of this Article 10 that
adversely affects the rights of the Holders of the Notes will require the
consent of the Holders of at least 75% in aggregate principal amount of Notes
then outstanding.

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                                  ARTICLE 11.
                                 NOTE GUARANTEES

Section 11.01     Guarantee.

(a) Subject to this Article 11, each of the Guarantors hereby, jointly and
severally, unconditionally guarantees to each Holder of a Note authenticated and
delivered by the Trustee and to the Trustee and its successors and assigns,
irrespective of the validity and enforceability of this Indenture, the Notes or
the obligations of the Company hereunder or thereunder, that:

(1)      the principal of, premium and Liquidated Damages, if any, and interest
         on the Notes will be promptly paid in full when due, whether at
         maturity, by acceleration, redemption or otherwise, and interest on the
         overdue principal of and interest on the Notes, if any, if lawful, and
         all other obligations of the Company to the Holders or the Trustee
         hereunder or thereunder will be promptly paid in full or performed, all
         in accordance with the terms hereof and thereof; and

(2)      in case of any extension of time of payment or renewal of any Notes or
         any of such other obligations, that same will be promptly paid in full
         when due or performed in accordance with the terms of the extension or
         renewal, whether at stated maturity, by acceleration or otherwise.

         Failing payment when due of any amount so guaranteed or any performance
so guaranteed for whatever reason, the Guarantors will be jointly and severally
obligated to pay the same immediately. Each Guarantor agrees that this is a
guarantee of payment and not a guarantee of collection.

         (b) The Guarantors hereby agree that their obligations hereunder are
unconditional, irrespective of the validity, regularity or enforceability of the
Notes or this Indenture, the absence of any action to enforce the same, any
waiver or consent by any Holder of the Notes with respect to any provisions
hereof or thereof, the recovery of any judgment against the Company, any action
to enforce the same or any other circumstance which might otherwise constitute a
legal or equitable discharge or defense of a guarantor. Each Guarantor hereby
waives diligence, presentment, demand of payment, filing of claims with a court
in the event of insolvency or bankruptcy of the Company, any right to require a
proceeding first against the Company, protest, notice and all demands whatsoever
and covenant that this Note Guarantee will not be discharged except by complete
performance of the obligations contained in the Notes and this Indenture.

         (c) If any Holder or the Trustee is required by any court or otherwise
to return to the Company, the Guarantors or any custodian, trustee, liquidator
or other similar official acting in relation to either the Company or the
Guarantors, any amount paid by either to the Trustee or such Holder, this Note
Guarantee, to the extent theretofore discharged, will be reinstated in full
force and effect.

         (d) Each Guarantor agrees that it will not be entitled to any right of
subrogation in relation to the Holders in respect of any obligations guaranteed
hereby until payment in full of all obligations guaranteed hereby. Each
Guarantor further agrees that, as between the Guarantors, on the one hand, and
the Holders and the Trustee, on the other hand, (1) the maturity of the
obligations guaranteed hereby may be accelerated as provided in Article 6 hereof
for the purposes of this Note Guarantee, notwithstanding any stay, injunction or
other prohibition preventing such acceleration in respect of the obligations
guaranteed hereby, and (2) in the event of any declaration of acceleration of
such obligations as provided in Article 6 hereof, such obligations (whether or
not due and payable) will forthwith become due and payable by the Guarantors for
the purpose of this Note Guarantee. The Guarantors will have the right to seek

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contribution from any non-paying Guarantor so long as the exercise of such right
does not impair the rights of the Holders under the Note Guarantee.

Section 11.02     Subordination of Note Guarantee.

         The Obligations of each Guarantor under its Note Guarantee pursuant to
this Article 11 will be junior and subordinated to the Senior Debt of such
Guarantor on the same basis as the Notes are junior and subordinated to Senior
Debt of the Company. For the purposes of the foregoing sentence, the Trustee and
the Holders will have the right to receive and/or retain payments by any of the
Guarantors only at such times as they may receive and/or retain payments in
respect of the Notes pursuant to this Indenture, including Article 10 hereof.

Section 11.03     Limitation on Guarantor Liability.

         Each Guarantor, and by its acceptance of Notes, each Holder, hereby
confirms that it is the intention of all such parties that the Note Guarantee of
such Guarantor not constitute a fraudulent transfer or conveyance for purposes
of Bankruptcy Law, the Uniform Fraudulent Conveyance Act, the Uniform Fraudulent
Transfer Act or any similar federal or state law to the extent applicable to any
Note Guarantee. To effectuate the foregoing intention, the Trustee, the Holders
and the Guarantors hereby irrevocably agree that the obligations of such
Guarantor will be limited to the maximum amount that will, after giving effect
to such maximum amount and all other contingent and fixed liabilities of such
Guarantor that are relevant under such laws, and after giving effect to any
collections from, rights to receive contribution from or payments made by or on
behalf of any other Guarantor in respect of the obligations of such other
Guarantor under this Article 11, result in the obligations of such Guarantor
under its Note Guarantee not constituting a fraudulent transfer or conveyance.

Section 11.04     Execution and Delivery of Note Guarantee.

         To evidence its Note Guarantee set forth in Section 11.01, each
Guarantor hereby agrees that a notation of such Note Guarantee substantially in
the form attached as Exhibit E hereto will be endorsed by an Officer of such
Guarantor on each Note authenticated and delivered by the Trustee and that this
Indenture will be executed on behalf of such Guarantor by one of its Officers.

         Each Guarantor hereby agrees that its Note Guarantee set forth in
Section 11.01 will remain in full force and effect notwithstanding any failure
to endorse on each Note a notation of such Note Guarantee.

         If an Officer whose signature is on this Indenture or on the Note
Guarantee no longer holds that office at the time the Trustee authenticates the
Note on which a Note Guarantee is endorsed, the Note Guarantee will be valid
nevertheless.

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

         In the event that any Restricted Subsidiary of the Company is required
by Section 4.18 hereof to become a Guarantor hereunder, or that the Company
elects that any of its Subsidiaries becomes a Guarantor hereunder, the Company
will cause such Subsidiary to comply with the provisions of Section 4.18 hereof
and this Article 11 to the extent applicable.

Section 11.05     Guarantors May Consolidate, etc., on Certain Terms.

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<PAGE>

         Except as otherwise provided in Section 11.05, no Guarantor may sell or
otherwise dispose of all or substantially all of its assets to, or consolidate
with or merge with or into (whether or not such Guarantor is the surviving
Person) another Person, other than the Company or another Guarantor, unless:

                  (1) immediately after giving effect to such transaction, no
         Default or Event of Default exists; and

                  (2) either:

                           (a) subject to Section 11.05 hereof, the Person
         acquiring the property in any such sale or disposition or the Person
         formed by or surviving any such consolidation or merger unconditionally
         assumes all the obligations of that Guarantor, pursuant to a
         supplemental indenture in form and substance reasonably satisfactory to
         the Trustee, under the Notes, this Indenture and the Note Guarantee on
         the terms set forth herein or therein; and

                           (b) the Net Proceeds of such sale or other
         disposition are applied in accordance with the applicable provisions of
         this Indenture, including without limitation, Section 4.10 hereof.

         In case of any such consolidation, merger, sale or conveyance and upon
the assumption by the successor Person, by supplemental indenture, executed and
delivered to the Trustee and satisfactory in form to the Trustee, of the Note
Guarantee endorsed upon the Notes and the due and punctual performance of all of
the covenants and conditions of this Indenture to be performed by the Guarantor,
such successor Person will succeed to and be substituted for the Guarantor with
the same effect as if it had been named herein as a Guarantor. Such successor
Person thereupon may cause to be signed any or all of the Note Guarantees to be
endorsed upon all of the Notes issuable hereunder which theretofore shall not
have been signed by the Company and delivered to the Trustee. All the Note
Guarantees so issued will in all respects have the same legal rank and benefit
under this Indenture as the Note Guarantees theretofore and thereafter issued in
accordance with the terms of this Indenture as though all of such Note
Guarantees had been issued at the date of the execution hereof.

         Except as set forth in Articles 4 and 5 hereof, and notwithstanding
clauses (a) and (b) above, nothing contained in this Indenture or in any of the
Notes will prevent any consolidation or merger of a Guarantor with or into the
Company or another Guarantor, or will prevent any sale or conveyance of the
property of a Guarantor as an entirety or substantially as an entirety to the
Company or another Guarantor.

Section 11.06     Releases Following Sale of Assets.

         In the event of any sale or other disposition of all or substantially
all of the assets of any Guarantor, by way of merger, consolidation or
otherwise, or a sale or other disposition of all to the Capital Stock of any
Guarantor, in each case to a Person that is not (either before or after giving
effect to such transactions) a Restricted Subsidiary of the Company, then such
Guarantor (in the event of a sale or other disposition, by way of merger,
consolidation or otherwise, of all of the capital stock of such Guarantor) or
the corporation acquiring the property (in the event of a sale or other
disposition of all or substantially all of the assets of such Guarantor) will be
released and relieved of any obligations under its Note Guarantee; provided that
the Net Proceeds of such sale or other disposition are applied in accordance
with the applicable provisions of this Indenture, including without limitation
Section 4.10 hereof. Upon delivery by the Company to the Trustee of an Officers'
Certificate and an Opinion of Counsel to the effect that such sale or other
disposition was made by the Company in accordance with the provisions of this
Indenture, including without limitation Section 4.10 hereof, the Trustee will
execute any documents reasonably required in order to evidence the release of
any Guarantor from its obligations under its Note Guarantee.

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<PAGE>

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

Section 11.07     Operation.

         Notwithstanding anything in this Indenture to the contrary, the
provisions of this Article 11 will not become operative unless and until, and
only for so long as, any Subsidiary of the Company becomes, and is, a Guarantor
of the Notes pursuant to the provisions of Section 4.18 of this Indenture.

                                  ARTICLE 12.
                           SATISFACTION AND DISCHARGE

Section 12.01     Satisfaction and Discharge.

         This Indenture will be discharged and will cease to be of further
effect as to all Notes issued hereunder, when:

                  (1) either:

                           (a) all Notes that have been authenticated, except
         lost, stolen or destroyed Notes that have been replaced or paid and
         Notes for whose payment money has been deposited in trust and
         thereafter repaid to the Company, have been delivered to the Trustee
         for cancellation; or

                           (b) all Notes that have not been delivered to the
         Trustee for cancellation have become due and payable by reason of the
         mailing of a notice of redemption or otherwise or will become due and
         payable within one year and the Company or any Guarantor has
         irrevocably deposited or caused to be deposited with the Trustee as
         trust funds in trust solely for the benefit of the Holders, cash in
         United States dollars, non-callable Government Securities, or a
         combination thereof, in such amounts as will be sufficient without
         consideration of any reinvestment of interest, to pay and discharge the
         entire indebtedness on the Notes not delivered to the Trustee for
         cancellation for principal, premium and Liquidated Damages, if any, and
         accrued interest to the date of maturity or redemption;

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

                  (3) the Company or any Guarantor has paid or caused to be paid
         all sums payable by it under this Indenture; and

                  (4) the Company has delivered irrevocable instructions to the
         Trustee under this Indenture to apply the deposited money toward the
         payment of the Notes at maturity or the redemption date, as the case
         may be.

In addition, the Company must deliver an Officers' Certificate and an Opinion of
Counsel to the Trustee stating that all conditions precedent to satisfaction and
discharge have been satisfied.

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<PAGE>

         Notwithstanding the satisfaction and discharge of this Indenture, if
money has been deposited with the Trustee pursuant to subclause (b) of clause
(1) of this Section, the provisions of Section 12.02 and Section 8.06 will
survive. In addition, nothing in this Section 12.01 will be deemed to discharge
those provisions of Section 7.07 hereof, that, by their terms, survive the
satisfaction and discharge of this Indenture.

Section 12.02     Application of Trust Money.

         Subject to the provisions of Section 8.06, all money deposited with the
Trustee pursuant to Section 12.01 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 Company 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 for whose payment such money
has been deposited with the Trustee; but such money need not be segregated from
other funds except to the extent required by law.

         If the Trustee or Paying Agent is unable to apply any money or
Government Securities in accordance with Section 12.01 by reason of any legal
proceeding or by reason of any order or judgment of any court or governmental
authority enjoining, restraining or otherwise prohibiting such application, the
Company's and any Guarantor's obligations under this Indenture and the Notes
shall be revived and reinstated as though no deposit had occurred pursuant to
Section 12.01; provided that if the Company has made any payment of principal
of, premium, if any, or interest on any Notes because of the reinstatement of
its obligations, the Company shall be subrogated to the rights of the Holders of
such Notes to receive such payment from the money or Government Securities held
by the Trustee or Paying Agent.

                                  ARTICLE 13.
                                  MISCELLANEOUS

Section 13.01     Trust Indenture Act Controls.

         If any provision of this Indenture limits, qualifies or conflicts with
another provision that is required to be included herein by the TIA, the
required provision will control.

Section 13.02     Notices.

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

         If to the Company and/or any Guarantor:

         Cole National Group, Inc.
         5915 Landerbrook Drive
         Mayfield Heights, Ohio 44124
         Telecopier No.:  (440) 461-3489
         Attention:  General Counsel

         With a copy to:

                                       84
<PAGE>

         Jones, Day, Reavis & Pogue
         901 Lakeside Avenue
         Cleveland, Ohio 44114
         Telecopier No.:  (216) 579-0212
         Attention:  David P. Porter, Esq.

         If to the Trustee:

         Wells Fargo Bank Minnesota, N.A.
         MAC N9303-110
         Sixth and Marquette Avenue
         Minneapolis, Minnesota 55479
         Telecopier No.:  (612) 667-2160
         Attention:  Michael G. Slade

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

         All notices and communications (other than those sent to Holders) will
be deemed to have been duly given: at the time delivered by hand, if personally
delivered; five Business Days after being deposited in the mail, postage
prepaid, if mailed; when answered back, if telexed; when receipt acknowledged,
if telecopied; and the next Business Day after timely delivery to the courier,
if sent by overnight air courier guaranteeing next day delivery.

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

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

         If the Company mails a notice or communication to Holders, it will mail
a copy to the Trustee and each Agent at the same time.

Section 13.03     Communication by Holders of Notes with Other Holders of Notes.

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

Section 13.04     Certificate and Opinion as to Conditions Precedent.

         Upon any request or application by the Company to the Trustee to take
any action under this Indenture, except for the issuance of the Initial Notes,
the Company shall furnish to the Trustee:

                  (1) an Officers' Certificate in form and substance reasonably
         satisfactory to the Trustee (which must include the statements set
         forth in Section 13.05 hereof) stating that, in the opinion of the
         signers, all conditions precedent and covenants, if any, provided for
         in this Indenture relating to the proposed action have been satisfied;
         and

                                       85
<PAGE>

                  (2) an Opinion of Counsel in form and substance reasonably
         satisfactory to the Trustee (which must include the statements set
         forth in Section 13.05 hereof) stating that, in the opinion of such
         counsel, all such conditions precedent and covenants have been
         satisfied.

Section 13.05     Statements Required in Certificate or Opinion.

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

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

                  (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 such Person, 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 satisfied; and

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

Section 13.06     Rules by Trustee and Agents.

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

Section 13.07     No Personal Liability of Directors, Officers, Employees and
                  Stockholders.

         No director, officer, employee, incorporator, Affiliate or stockholder
of the Company or any Guarantor, solely by reason of this status, will have any
liability for any obligations of the Company or the Guarantors under the Notes,
this Indenture, any Note Guarantees, or for any claim based on, in respect of,
or by reason of, such obligations or their creation. Each Holder of Notes by
accepting a Note waives and releases all such liability. The waiver and release
are part of the consideration for issuance of the Notes. The waiver may not be
effective to waive liabilities under the federal securities laws.

Section 13.08     Governing Law.

         THE INTERNAL LAW OF THE STATE OF NEW YORK WILL GOVERN AND BE USED TO
CONSTRUE THIS INDENTURE, THE NOTES AND THE NOTE GUARANTEES WITHOUT GIVING EFFECT
TO APPLICABLE PRINCIPLES OF CONFLICTS OF LAW TO THE EXTENT THAT THE APPLICATION
OF THE LAWS OF ANOTHER JURISDICTION WOULD BE REQUIRED THEREBY.

Section 13.09     No Adverse Interpretation of Other Agreements.

                                       86
<PAGE>

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

Section 13.10     Successors.

         All agreements of the Company in this Indenture and the Notes will bind
its successors. All agreements of the Trustee in this Indenture will bind its
successors. All agreements of each Guarantor in this Indenture will bind its
successors, except as otherwise provided in Section 11.05.

Section 13.11     Severability.

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

Section 13.12     Counterpart Originals.

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

Section 13.13     Table of Contents, Headings, etc.

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

                         [Signatures on following page]

                                       87
<PAGE>

                                   SIGNATURES

Dated as of May 22, 2002
                                          COLE NATIONAL GROUP, INC.

                                          By:
                                                --------------------------------
                                                Name:
                                                Title:

                                          WELLS FARGO BANK MINNESOTA, N.A.

                                          By:
                                                --------------------------------
                                                Name:
                                                Title:

                                       88
<PAGE>

                                                                       EXHIBIT A

                                 [Face of Note]
--------------------------------------------------------------------------------

                                                              CUSIP ____________

                    8 7/8% Senior Subordinated Notes due 2012

No.                                                                $____________
    ---
                            COLE NATIONAL GROUP, INC.

promises to pay to
                   ------------

or registered assigns,

the principal sum of
                     -----------------------------------------------------------

Dollars on              , 2012.
           -------------

Interest Payment Dates:               and
                         ------------     ------------

Record Dates:               and
               ------------     ------------

Dated:                 , 20
        ---------------    ---
                                            COLE NATIONAL GROUP, INC.

                                            By:
                                                --------------------------------
                                                Name:
                                                Title:

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

WELLS FARGO BANK MINNESOTA, N.A.,
  as Trustee

By:
     --------------------------------
          Authorized Signatory

--------------------------------------------------------------------------------

                                      A-1

<PAGE>

                                 [Back of Note]
                    8 7/8% Senior Subordinated Notes due 2012

[Insert the Global Note Legend, if applicable pursuant to the provisions of the
Indenture]

[Insert the Private Placement Legend, if applicable pursuant to the provisions
of the Indenture]

         Capitalized terms used herein have the meanings assigned to them in the
Indenture referred to below unless otherwise indicated.

                  (1) INTEREST. Cole National Group, Inc., a Delaware
         corporation (the "Company"), promises to pay interest on the principal
         amount of this Note at 8 7/8% per annum from November 15, 2002 until
         maturity and shall pay the Liquidated Damages, if any, payable pursuant
         to Section 5 of the Registration Rights Agreement referred to below.
         The Company will pay interest and Liquidated Damages, if any,
         semi-annually in arrears on May 15 and November 15 of each year, or if
         any such day is not a Business Day, on the next succeeding Business Day
         (each, an "Interest Payment Date"). Interest on the Notes will accrue
         from the most recent date to which interest has been paid or, if no
         interest has been paid, from the date of issuance; provided that if
         there is no existing Default in the payment of interest, and if this
         Note is authenticated between a record date referred to on the face
         hereof and the next succeeding Interest Payment Date, interest shall
         accrue from such next succeeding Interest Payment Date; provided,
         further, that the first Interest Payment Date shall be the first May 15
         or November 15 to occur after the date of issuance, unless such May 15
         or November 15 occurs within one calendar month of such date of
         issuance, in which case the first Interest Payment Date shall be the
         second of May 15 or November 15 to occur after the date of issuance.
         The Company will pay interest (including post-petition interest in any
         proceeding under any Bankruptcy Law) on overdue principal and premium,
         if any, from time to time on demand at a rate that is 1% per annum in
         excess of the rate then in effect; it will pay interest (including
         post-petition interest in any proceeding under any Bankruptcy Law) on
         overdue installments of interest and Liquidated Damages, if any,
         (without regard to any applicable grace periods) from time to time on
         demand at the same rate to the extent lawful. Interest will be computed
         on the basis of a 360-day year of twelve 30-day months.

                  (2) METHOD OF PAYMENT. The Company will pay interest on the
         Notes (except defaulted interest) and Liquidated Damages, if any, to
         the Persons who are registered Holders of Notes at the close of
         business on the May 1 or November 1 next preceding the Interest Payment
         Date, even if such Notes are canceled after such record date and on or
         before such Interest Payment Date, except as provided in Section 2.12
         of the Indenture with respect to defaulted interest. The Notes will be
         payable as to principal, premium and Liquidated Damages, if any, and
         interest at the office or agency of the Company maintained for such
         purpose within or without the City and State of New York, or, at the
         option of the Company, payment of interest and Liquidated Damages, if
         any, may be made by check mailed to the Holders at their addresses set
         forth in the register of Holders; provided that payment by wire
         transfer of immediately available funds will be required with respect
         to principal of and interest, premium and Liquidated Damages, if any,
         on, all Global Notes and all other Notes the Holders of which will have
         provided wire transfer instructions to the Company or the Paying Agent.
         Such payment will be 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.

                  (3) PAYING AGENT AND REGISTRAR. Initially, Wells Fargo Bank
         Minnesota, N.A., the Trustee under the Indenture, will act as Paying
         Agent and Registrar. The Company may change

                                      A-2
<PAGE>

         any Paying Agent or Registrar without notice to any Holder. The Company
         or any of its Subsidiaries may act as Paying Agent or Registrar.

                  (4) INDENTURE. The Company issued the Notes under an Indenture
         dated as of May 22, 2002 (the "Indenture") between the Company and the
         Trustee. The terms of the Notes include those stated in the Indenture
         and those made part of the Indenture by reference to the Trust
         Indenture Act of 1939, as amended (15 U.S. Code ss.ss. 77aaa-77bbbb).
         The Notes are subject to all such terms, and Holders are referred to
         the Indenture and such Act for a statement of such terms. To the extent
         any provision of this Note conflicts with the express provisions of the
         Indenture, the provisions of the Indenture shall govern and be
         controlling. The Notes are unsecured obligations of the Company.

                  (5) OPTIONAL REDEMPTION.

                           (a) Except as set forth in subparagraph (b) of this
         Paragraph 5, the Company will not have the option to redeem the Notes
         prior to May 15, 2007. Thereafter, the Company will have the option to
         redeem all or, from time to time, a part of the Notes upon not less
         than 30 nor more than 60 days' notice, at the redemption prices
         (expressed as percentages of principal amount) set forth below plus
         accrued and unpaid interest and Liquidated Damages, if any, thereon to
         the applicable redemption date, if redeemed during the twelve-month
         period beginning on May 15 of the years indicated below:

<TABLE>
<CAPTION>
                  Year                                    Percentage
                  ----                                    ----------
<S>                                                        <C>
                  2007.................................    104.438%
                  2008.................................    102.958%
                  2009.................................    101.479%
                  2010 and thereafter..................    100.000%
</TABLE>

                           (b) Notwithstanding the provisions of subparagraph
         (a) of this Paragraph 5, at any time prior to May 15, 2005, the Company
         may on any one or more occasions redeem up to 40% of the aggregated
         principal amount of Notes issued under the Indenture at a redemption
         price of 108.875% of the principal amount thereof, plus accrued and
         unpaid interest and Liquidated Damages, if any, to the redemption date,
         with the net cash proceeds of one or more Qualified Equity Offering;
         provided that at least 60% of aggregate principal amount of Notes
         issued under the Indenture remains outstanding immediately after the
         occurrence of such redemption (excluding Notes held by the Company and
         its Subsidiaries) and that such redemption occurs within 60 days of the
         date of the closing of such Qualified Equity Offering.

                  (6) MANDATORY REDEMPTION. The Company is not required to make
         mandatory redemption payments with respect to the Notes.

                  (7) REPURCHASE AT OPTION OF HOLDER.

                           (a) If there is a Change of Control, the Company will
         make an offer (a "Change of Control Offer") to each Holder to
         repurchase all or any part (equal to $1,000 or an integral multiple
         thereof) of each Holder's Notes at a purchase price equal to 101% of
         the aggregate principal amount thereof plus accrued and unpaid interest
         and Liquidated Damages on the Notes repurchased, if any, to the date of
         purchase (the "Change of Control Payment"). Within 15 days following
         any Change of Control, the Company will mail a notice to each Holder
         setting forth the procedures governing the Change of Control Offer as
         required by the Indenture.

                                      A-3
<PAGE>

                           (b) If the Company or a Subsidiary consummates any
         Asset Sales, and the aggregate amount of Excess Proceeds exceeds $10.0
         million, the Company will (a) first, make an Excess Proceeds Offer (as
         defined in the 9 7/8% Notes Indenture) with respect to any outstanding
         9 7/8% Notes, (b) second, make an Excess Proceeds Offer (as defined in
         the 8 5/8% Notes Indenture) with respect to any outstanding 8 5/8%
         Notes, and (c) third, make an Asset Sale Offer to all Holders of Notes
         and all holders of other Indebtedness that is pari passu with the Notes
         containing provisions similar to those set forth in the Indenture with
         respect to offers to purchase or redeem with the proceeds of sales of
         assets (an "Asset Sale Offer") pursuant to Section 3.09 of the
         Indenture to purchase the maximum principal amount of Notes and such
         other pari passu Indebtedness that may be purchased out of the Excess
         Proceeds at an offer price in cash in an amount equal to 100% of the
         principal amount thereof plus accrued and unpaid interest and
         Liquidated Damages thereon, if any, to the date of purchase in
         accordance with the procedures set forth in the Indenture. To the
         extent that any Excess Proceeds remain after consummation of an Asset
         Sale Offer, the Company may use those Excess Proceeds for any purpose
         not otherwise prohibited by the Indenture. If the aggregate principal
         amount of Notes and other pari passu Indebtedness tendered into such
         Asset Sale Offer exceeds the amount of Excess Proceeds, the Trustee
         will select the Notes and such other pari passu Indebtedness to be
         purchased on a pro rata basis based upon the principal amount of Notes
         and such other pari passu Indebtedness tendered. Holders of Notes that
         are the subject of an offer to purchase will receive an Asset Sale
         Offer from the Company prior to any related purchase date and may elect
         to have such Notes purchased by completing the form entitled "Option of
         Holder to Elect Purchase" on the reverse of the Notes.

                  (8) NOTICE OF REDEMPTION. Subject to certain exceptions set
         forth in the Indenture, notice of redemption will be mailed at least 30
         days but not more than 60 days before a redemption date to each Holder
         whose Notes are to be redeemed at its registered address. Notes and
         portions of Notes selected will be in amounts of $1,000 and whole
         multiples of $1,000; except that if all of the Notes of a Holder are to
         be redeemed or purchased, the entire outstanding amount of Notes held
         by such Holder, even if not a multiple of $1,000, shall be redeemed or
         purchased. On and after the redemption date interest ceases to accrue
         on Notes called for redemption.

                  (9) DENOMINATIONS, TRANSFER, EXCHANGE. The Notes are in
         registered form without coupons in denominations of $1,000 and integral
         multiples of $1,000. The transfer of Notes may be registered and Notes
         may be exchanged as provided in the Indenture. The Registrar and the
         Trustee may require a Holder, among other things, to furnish
         appropriate endorsements and transfer documents and the Company may
         require a Holder to pay any taxes and fees required by law or permitted
         by the Indenture. The Company need not exchange or register the
         transfer of any Note selected for redemption in whole or in part,
         except for the unredeemed portion of any Note being redeemed in part.
         Also, the Company need not exchange or register the transfer of any
         Notes for a period of 15 days before the day of any selection of Notes
         to be redeemed or during the period between a record date and the
         corresponding Interest Payment Date.

                  (10) PERSONS DEEMED OWNERS. The registered Holder of a Note
         may be treated as its owner for all purposes.

                  (11) AMENDMENT, SUPPLEMENT AND WAIVER. Subject to certain
         exceptions, the Indenture, the Note Guarantees or the Notes may be
         amended or supplemented with the consent of the Holders of at least a
         majority in principal amount of the then outstanding Notes and
         Additional Notes, if any, voting as a single class, and any existing
         default or compliance with any

                                      A-4
<PAGE>

         provision of the Indenture, the Note Guarantees or the Notes may be
         waived with the consent of the Holders of a majority in principal
         amount of the then outstanding Notes voting as a single class. Without
         the consent of any Holder of a Note, the Indenture, the Note Guarantees
         or the Notes may be amended or supplemented to cure any ambiguity,
         defect or inconsistency, to provide for uncertificated Notes in
         addition to or in place of certificated Notes, to alter Article 2 of
         the Indenture relating to the Notes in a manner that does not
         materially adversely affect any Holder, to provide for the assumption
         of the Company's or any Guarantor's obligations to Holders of the Notes
         by a successor to the Company in case of a merger or consolidation, to
         make any change that would provide any additional rights or benefits to
         the Holders of the Notes or that does not adversely affect the legal
         rights under the Indenture of any such Holder, to comply with the
         requirements of the SEC in order to effect or maintain the
         qualification of the Indenture under the Trust Indenture Act, to
         provide for the issuance of Additional Notes in accordance with the
         limitations set forth in the Indenture, or to allow any Guarantor to
         execute a supplemental indenture to the Indenture and/or a Note
         Guarantee with respect to the Notes.

                  (12) DEFAULTS AND REMEDIES. Events of Default include: (i)
         default for 30 days in the payment when due of interest on, or
         Liquidated Damages with respect to, the Notes whether or not prohibited
         by the subordination provisions of the Indenture; (ii) default in
         payment when due of principal of, or premium, if any, on the Notes
         whether or not prohibited by the subordination provisions of the
         Indenture, (iii) failure by the Company to comply with Sections 4.14 or
         5.01 of the Indenture; (iv) failure by the Company or any of its
         Subsidiaries for 60 days after written notice from the Trustee or the
         Holders of at least 25% in principal amount of the Notes then
         outstanding to observe, perform or comply with any of the other
         covenant, representation, warranty or other agreement in the Indenture
         or the Notes; (v) default under certain other agreements relating to
         Indebtedness of the Company which default (A) is caused by a failure to
         pay at final maturity (within the grace period provided in such
         Indebtedness) principal, interest or premium in an aggregate amount of
         $5.0 million or more with respect to such Indebtedness or (B) results
         in the acceleration of any such Indebtedness aggregating $5.0 million
         or more, which default or acceleration shall not be cured, waived or
         postponed pursuant to an agreement with the holders of such
         Indebtedness within 60 days after written notice, or such acceleration
         shall not be rescinded or annulled within 20 days after written notice;
         (vi) certain final judgments for the payment of money that remain
         undischarged for a period of 60 days; (vii) certain events of
         bankruptcy or insolvency with respect to the Company or any of its
         Significant Subsidiaries; and (viii) except as permitted by the
         Indenture, any Note Guarantee shall be held in any judicial proceeding
         to be unenforceable or invalid or shall cease for any reason to be in
         full force and effect or any Guarantor, or any Person acting on behalf
         of any Guarantor, shall deny or disaffirm its obligations under its
         Note Guarantee. If any Event of Default occurs and is continuing, the
         Trustee or the Holders of at least 25% in principal amount of the then
         outstanding Notes may declare all the Notes to be due and payable
         immediately; provided that so long as any Indebtedness permitted to be
         incurred under this Indenture as part of the Senior Credit Facility is
         outstanding, no acceleration shall be effective until the earlier of
         (A) five Business Days after the giving of written notice to the
         Company and the administrative agent under the Senior Credit Facility
         of the acceleration or (B) the acceleration of any Indebtedness under
         the Senior Credit Facility. Notwithstanding the foregoing, in the case
         of an Event of Default arising from certain events of bankruptcy or
         insolvency, all outstanding Notes will become due and payable without
         further action or notice. Holders may not enforce the Indenture or the
         Notes except as provided in the Indenture. Subject to certain
         limitations, Holders of a majority in principal amount of the then
         outstanding Notes may direct the Trustee in its exercise of any trust
         or power. The Trustee may withhold from Holders of the Notes notice of
         any continuing Default or Event of Default if and so long as a
         committee of its Responsible Officers in good faith determines that
         withholding notice is in the interests of the Holders, except a Default
         or Event of

                                      A-5
<PAGE>

         Default relating to the payment of principal or interest or Liquidated
         Damages. The Holders of a majority in aggregate principal amount of the
         Notes then outstanding by notice to the Trustee may on behalf of the
         Holders of all of the Notes waive any existing Default or Event of
         Default and its consequences under the Indenture except a continuing
         Default or Event of Default in the payment of interest or Liquidated
         Damages on, or the principal of, the Notes. The Company is required to
         deliver to the Trustee annually a statement regarding compliance with
         the Indenture, and the Company is required upon becoming aware of any
         Default or Event of Default, to deliver to the Trustee a statement
         specifying such Default or Event of Default.

                  (13) SUBORDINATION. Payment of principal, interest and premium
         and Liquidated Damages, if any, on the Notes is subordinated to the
         prior payment of Senior Debt on the terms provided in the Indenture.

                  (14) TRUSTEE DEALINGS WITH COMPANY. The Trustee, in its
         individual or any other capacity, may become the owner or pledgee of
         Notes and may otherwise deal with the Company or its Affiliates with
         the same right as it would have if it were not the Trustee.

                  (15) NO RECOURSE AGAINST OTHERS. No director, officer,
         employee, incorporator, Affiliate or stockholder, of the Company or any
         Guarantor, solely by reason of this status, will have any liability for
         any obligations of the Company or Guarantor under the Notes, any Note
         Guarantees or the Indenture or for any claim based on, in respect of,
         or by reason of, such obligations or their creation. Each Holder by
         accepting a Note waives and releases all such liability. The waiver and
         release are part of the consideration for the issuance of the Notes.

                  (16) AUTHENTICATION. This Note will not be valid until
         authenticated by the manual signature of the Trustee or an
         authenticating agent.

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

                  (18) ADDITIONAL RIGHTS OF HOLDERS OF RESTRICTED GLOBAL NOTES
         AND RESTRICTED DEFINITIVE NOTES. In addition to the rights provided to
         Holders of Notes under the Indenture, Holders of Restricted Global
         Notes and Restricted Definitive Notes will have all the rights set
         forth in the Registration Rights Agreement dated as of May 22, 2002,
         between the Company and the other parties named on the signature pages
         thereof or, in the case of Additional Notes, Holders of Restricted
         Global Notes and Restricted Definitive Notes will have the rights set
         forth in one or more registration rights agreements, if any, among the
         Company, the Guarantors, if any, and the other parties thereto,
         relating to rights given by the Company to the purchasers of Additional
         Notes to register such Additional Notes under the Securities Act
         (collectively, the "Registration Rights Agreement").

                  (19) CUSIP NUMBERS. Pursuant to a recommendation promulgated
         by the Committee on Uniform Security Identification Procedures, the
         Company has caused CUSIP numbers to be printed on the Notes and the
         Trustee may use CUSIP numbers in notices of redemption as a convenience
         to Holders. No representation is made as to the accuracy of such
         numbers either as printed on the Notes or as contained in any notice of
         redemption and reliance may be placed only on the other identification
         numbers placed thereon.

                                      A-6
<PAGE>

         The Company will furnish to any Holder upon written request and without
charge a copy of the Indenture and/or the Registration Rights Agreement.
Requests may be made to:

Cole National Group, Inc.
5915 Landerbrook Drive
Mayfield Heights, Ohio 44124
Attention:  General Counsel

                                      A-7
<PAGE>

                                 ASSIGNMENT FORM

         To assign this Note, fill in the form below:

(I) or (we) assign and transfer this Note to:
                                             -----------------------------------
                                                (Insert assignee's legal name)

--------------------------------------------------------------------------------
                  (Insert assignee's soc. sec. or tax I.D. no.)

--------------------------------------------------------------------------------

--------------------------------------------------------------------------------

--------------------------------------------------------------------------------

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

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

Date:
       ---------------
                               Your Signature:
                                              ----------------------------------
                    (Sign exactly as your name appears on the face of this Note)

Signature Guarantee*:
                      ------------------------------

* Participant in a recognized Signature Guarantee Medallion Program (or other
signature guarantor acceptable to the Trustee).

                                      A-8
<PAGE>

                       OPTION OF HOLDER TO ELECT PURCHASE

         If you want to elect to have this Note purchased by the Company
pursuant to Section 4.10 or 4.14 of the Indenture, check the appropriate box
below:

                       [ ] Section 4.10   [ ] Section 4.14

         If you want to elect to have only part of the Note purchased by the
Company pursuant to Section 4.10 or Section 4.14 of the Indenture, state the
amount you elect to have purchased:

                                  $
                                   -------------

Date:
      ----------------

                                     Your Signature:
                                                    ----------------------------
                                       (Sign exactly as your name appears on the
                                       face of this Note)

                                     Tax Identification No.:
                                                             -------------------

Signature Guarantee*:
                      ----------------------
* Participant in a recognized Signature Guarantee Medallion Program (or other
signature guarantor acceptable to the Trustee).

                                      A-9
<PAGE>

             SCHEDULE OF EXCHANGES OF INTERESTS IN THE GLOBAL NOTE*

         The following exchanges of a part of this Global Note for an interest
in another Global Note or for a Definitive Note, or exchanges of a part of
another Global Note or Definitive Note for an interest in this Global Note, have
been made:

<TABLE>
<CAPTION>
                                                                           Principal Amount
                                                                          of this Global Note       Signature of
                           Amount of decrease    Amount of increase in      following such       authorized officer
                           in Principal Amount      Principal Amount           decrease             of Trustee or
    Date of Exchange       of this Global Note    of this Global Note        (or increase)            Custodian
    ----------------       -------------------    -------------------        -------------            ---------
<S>                            <C>                      <C>                     <C>                     <C>

</TABLE>

* This schedule should be included only if the Note is issued in global form.

                                      A-10
<PAGE>

                                                                       EXHIBIT B

                         FORM OF CERTIFICATE OF TRANSFER

Cole National Group, Inc.
5915 Landerbrook Drive
Mayfield Heights, Ohio 44124

Wells Fargo Bank Minnesota, N.A.
MAC N9303-110
Sixth and Marquette Avenue
Minneapolis, Minnesota 55479

         Re:  8 7/8% Senior Subordinated Notes Due 2012
              -----------------------------------------

         Reference is hereby made to the Indenture, dated as of May 22, 2002
(the "Indenture"), between Cole National Group, Inc., as issuer (the "Company"),
and Wells Fargo Bank Minnesota, N.A., as trustee. Capitalized terms used but not
defined herein shall have the meanings given to them in the Indenture.

         ___________________ (the "Transferor"), owns and proposes to transfer
the Note[s] or interest in such Note[s] specified in Annex A hereto, in the
principal amount of $___________ in such Note[s] or interests (the "Transfer"),
to ___________________________ (the "Transferee"), as further specified in Annex
A hereto. In connection with the Transfer, the Transferor hereby certifies that:

                             [CHECK ALL THAT APPLY]

         1. [ ] CHECK IF TRANSFEREE WILL TAKE DELIVERY OF A BENEFICIAL INTEREST
IN THE 144A GLOBAL NOTE OR A DEFINITIVE NOTE PURSUANT TO RULE 144A. The Transfer
is being effected pursuant to and in accordance with Rule 144A under the
Securities Act of 1933, as amended (the "Securities Act"), and, accordingly, the
Transferor hereby further certifies that the beneficial interest or Definitive
Note is being transferred to a Person that the Transferor reasonably believed
and believes is purchasing the beneficial interest or Definitive Note for its
own account, or for one or more accounts with respect to which such Person
exercises sole investment discretion, and such Person and each such account is a
"qualified institutional buyer" within the meaning of Rule 144A in a transaction
meeting the requirements of Rule 144A and such Transfer is in compliance with
any applicable blue sky securities laws of any state of the United States. Upon
consummation of the proposed Transfer in accordance with the terms of the
Indenture, the transferred beneficial interest or Definitive Note will be
subject to the restrictions on transfer enumerated in the Private Placement
Legend printed on the 144A Global Note and/or the Definitive Note and in the
Indenture and the Securities Act.

         2. [ ] CHECK IF TRANSFEREE WILL TAKE DELIVERY OF A BENEFICIAL INTEREST
IN THE REGULATION S GLOBAL NOTE OR A DEFINITIVE NOTE PURSUANT TO REGULATION S.
The Transfer is being effected pursuant to and in accordance with Rule 903 or
Rule 904 under the Securities Act and, accordingly, the Transferor hereby
further certifies that (i) the Transfer is not being made to a Person in the
United States and (x) at the time the buy order was originated, the Transferee
was outside the United States or such Transferor and any Person acting on its
behalf reasonably believed and believes that the Transferee was outside the
United States or (y) the transaction was executed in, on or through the
facilities of a designated offshore securities market and neither such
Transferor nor any Person acting on its behalf knows that the transaction was
prearranged with a buyer in the United States, (ii) no directed selling efforts
have been made in contravention of the requirements of Rule 903(b) or Rule
904(b) of Regulation S under the Securities Act and (iii) the transaction is not
part of a plan or scheme to evade the registration requirements of the
Securities Act. Upon consummation of the proposed transfer in accordance with
the terms of the Indenture, the transferred beneficial interest or Definitive
Note will be subject to the

                                      B-1
<PAGE>

restrictions on Transfer enumerated in the Private Placement Legend printed on
the Regulation S Global Note and/or the Definitive Note and in the Indenture and
the Securities Act.

         3. [ ] CHECK AND COMPLETE IF TRANSFEREE WILL TAKE DELIVERY OF A
BENEFICIAL INTEREST IN THE RESTRICTED GLOBAL NOTE OR A DEFINITIVE NOTE PURSUANT
TO ANY PROVISION OF THE SECURITIES ACT OTHER THAN RULE 144A OR REGULATION S. The
Transfer is being effected in compliance with the transfer restrictions
applicable to beneficial interests in Restricted Global Notes and Restricted
Definitive Notes and pursuant to and in accordance with the Securities Act and
any applicable blue sky securities laws of any state of the United States, and
accordingly the Transferor hereby further certifies that (check one):

                  (a) [ ] such Transfer is being effected pursuant to and in
         accordance with Rule 144 under the Securities Act;

                                       or

                  (b) [ ] such Transfer is being effected to the Company or a
         subsidiary thereof;

                                       or

                  (c) [ ] such Transfer is being effected pursuant to an
         effective registration statement under the Securities Act and in
         compliance with the prospectus delivery requirements of the Securities
         Act;

                                       or

                  (d) [ ] such Transfer is being effected to an Institutional
         Accredited Investor and pursuant to an exemption from the registration
         requirements of the Securities Act other than Rule 144A, Rule 144 or
         Rule 904, and the Transferor hereby further certifies that it has not
         engaged in any general solicitation within the meaning of Regulation D
         under the Securities Act and the Transfer complies with the transfer
         restrictions applicable to beneficial interests in a Restricted Global
         Note or Restricted Definitive Notes and the requirements of the
         exemption claimed, which certification is supported by (1) a
         certificate executed by the Transferee in the form of Exhibit D to the
         Indenture and (2) if such Transfer is in respect of a principal amount
         of Notes at the time of transfer of less than $250,000, an Opinion of
         Counsel provided by the Transferor or the Transferee (a copy of which
         the Transferor has attached to this certification), to the effect that
         such Transfer is in compliance with the Securities Act. Upon
         consummation of the proposed transfer in accordance with the terms of
         the Indenture, the transferred beneficial interest or Definitive Note
         will be subject to the restrictions on transfer enumerated in the
         Private Placement Legend printed on the Definitive Notes and in the
         Indenture and the Securities Act.

         4. [ ] CHECK IF TRANSFEREE WILL TAKE DELIVERY OF A BENEFICIAL INTEREST
IN AN UNRESTRICTED GLOBAL NOTE OR OF AN UNRESTRICTED DEFINITIVE NOTE.

         (a) [ ] CHECK IF TRANSFER IS PURSUANT TO RULE 144. (i) The Transfer is
being effected pursuant to and in accordance with Rule 144 under the Securities
Act and in compliance with the transfer restrictions contained in the Indenture
and any applicable blue sky securities laws of any state of the United States
and (ii) the restrictions on transfer contained in the Indenture and the Private
Placement Legend are not required in order to maintain compliance with the
Securities Act. Upon consummation of the proposed Transfer in accordance with
the terms of the Indenture, the transferred beneficial interest or Definitive
Note will no longer be subject to the restrictions on transfer enumerated in the
Private

                                      B-2
<PAGE>

Placement Legend printed on the Restricted Global Notes, on Restricted
Definitive Notes and in the Indenture.

         (b) [ ] CHECK IF TRANSFER IS PURSUANT TO REGULATION S. (i) The Transfer
is being effected pursuant to and in accordance with Rule 903 or Rule 904 under
the Securities Act and in compliance with the transfer restrictions contained in
the Indenture and any applicable blue sky securities laws of any state of the
United States and (ii) the restrictions on transfer contained in the Indenture
and the Private Placement Legend are not required in order to maintain
compliance with the Securities Act. Upon consummation of the proposed Transfer
in accordance with the terms of the Indenture, the transferred beneficial
interest or Definitive Note will no longer be subject to the restrictions on
transfer enumerated in the Private Placement Legend printed on the Restricted
Global Notes, on Restricted Definitive Notes and in the Indenture.

         (c) [ ] CHECK IF TRANSFER IS PURSUANT TO OTHER EXEMPTION. (i) The
Transfer is being effected pursuant to and in compliance with an exemption from
the registration requirements of the Securities Act other than Rule 144, Rule
903 or Rule 904 and in compliance with the transfer restrictions contained in
the Indenture and any applicable blue sky securities laws of any State of the
United States and (ii) the restrictions on transfer contained in the Indenture
and the Private Placement Legend are not required in order to maintain
compliance with the Securities Act. Upon consummation of the proposed Transfer
in accordance with the terms of the Indenture, the transferred beneficial
interest or Definitive Note will not be subject to the restrictions on transfer
enumerated in the Private Placement Legend printed on the Restricted Global
Notes or Restricted Definitive Notes and in the Indenture.

         This certificate and the statements contained herein are made for your
benefit and the benefit of the Company.

                                      ------------------------------------------
                                            [Insert Name of Transferor]

                                      By:
                                          --------------------------------------
                                            Name:
                                            Title:

         Dated:
                 ----------------------

                                      B-3
<PAGE>

                       ANNEX A TO CERTIFICATE OF TRANSFER

         1.    The Transferor owns and proposes to transfer the following:

                         [CHECK ONE OF (a) OR (b)]

                  (a) [ ]  a beneficial interest in the:

                      (i)  [ ]  144A Global Note (CUSIP _________), or

                      (ii) [ ]  Regulation S Global Note (CUSIP _________), or

                  (b) [ ] a Restricted Definitive Note.

         2.    After the Transfer the Transferee will hold:

                                   [CHECK ONE]

                  (a) [ ] a beneficial interest in the:

                      (i)   [ ] 144A Global Note (CUSIP _________), or

                      (ii)  [ ] Regulation S Global Note (CUSIP _________), or

                      (iii) [ ] Unrestricted Global Note (CUSIP _________); or

                  (b) [ ] a Restricted Definitive Note; or

                  (c) [ ] an Unrestricted Definitive Note,

                  in accordance with the terms of the Indenture.

                                      B-4
<PAGE>

                                                                       EXHIBIT C

                         FORM OF CERTIFICATE OF EXCHANGE

Cole National Group, Inc.
5915 Landerbrook Drive
Mayfield Heights, Ohio 44124

Wells Fargo Bank Minnesota, N.A.
MAC N9303-110
Sixth and Marquette Avenue
Minneapolis, Minnesota 55479

         Re:  8 7/8% Senior Subordinated Notes Due 2012
              -----------------------------------------

                              (CUSIP ____________)

         Reference is hereby made to the Indenture, dated as of May 22, 2002
(the "Indenture"), between Cole National Group, Inc., issuer (the "Company"),
and Wells Fargo Bank Minnesota, N.A., as trustee. Capitalized terms used but not
defined herein shall have the meanings given to them in the Indenture.

         __________________________ (the "Owner"), owns and proposes to exchange
the Note[s] or interest in such Note[s] specified herein, in the principal
amount of $____________ in such Note[s] or interests (the "Exchange"). In
connection with the Exchange, the Owner hereby certifies that:

         1. EXCHANGE OF RESTRICTED DEFINITIVE NOTES OR BENEFICIAL INTERESTS IN A
         -----------------------------------------------------------------------
RESTRICTED GLOBAL NOTE FOR UNRESTRICTED DEFINITIVE NOTES OR BENEFICIAL INTERESTS
--------------------------------------------------------------------------------
IN AN UNRESTRICTED GLOBAL NOTE
------------------------------

         (a) [ ] CHECK IF EXCHANGE IS FROM BENEFICIAL INTEREST IN A RESTRICTED
GLOBAL NOTE TO BENEFICIAL INTEREST IN AN UNRESTRICTED GLOBAL NOTE. In connection
with the Exchange of the Owner's beneficial interest in a Restricted Global Note
for a beneficial interest in an Unrestricted Global Note in an equal principal
amount, the Owner hereby certifies (i) the beneficial interest is being acquired
for the Owner's own account without transfer, (ii) such Exchange has been
effected in compliance with the transfer restrictions applicable to the Global
Notes and pursuant to and in accordance with the Securities Act of 1933, as
amended (the "Securities Act"), (iii) the restrictions on transfer contained in
the Indenture and the Private Placement Legend are not required in order to
maintain compliance with the Securities Act and (iv) the beneficial interest in
an Unrestricted Global Note is being acquired in compliance with any applicable
blue sky securities laws of any state of the United States.

         (b) [ ] CHECK IF EXCHANGE IS FROM BENEFICIAL INTEREST IN A RESTRICTED
GLOBAL NOTE TO UNRESTRICTED DEFINITIVE NOTE. In connection with the Exchange of
the Owner's beneficial interest in a Restricted Global Note for an Unrestricted
Definitive Note, the Owner hereby certifies (i) the Definitive Note is being
acquired for the Owner's own account without transfer, (ii) such Exchange has
been effected in compliance with the transfer restrictions applicable to the
Restricted Global Notes and pursuant to and in accordance with the Securities
Act, (iii) the restrictions on transfer contained in the Indenture and the
Private Placement Legend are not required in order to maintain compliance with
the Securities Act and (iv) the Definitive Note is being acquired in compliance
with any applicable blue sky securities laws of any state of the United States.

         (c) [ ] CHECK IF EXCHANGE IS FROM RESTRICTED DEFINITIVE NOTE TO
BENEFICIAL INTEREST IN AN UNRESTRICTED GLOBAL NOTE. In connection with the
Owner's Exchange of a Restricted Definitive Note for

                                      C-1
<PAGE>

a beneficial interest in an Unrestricted Global Note, the Owner hereby certifies
(i) the beneficial interest is being acquired for the Owner's own account
without transfer, (ii) such Exchange has been effected in compliance with the
transfer restrictions applicable to Restricted Definitive Notes and pursuant to
and in accordance with the Securities Act, (iii) the restrictions on transfer
contained in the Indenture and the Private Placement Legend are not required in
order to maintain compliance with the Securities Act and (iv) the beneficial
interest is being acquired in compliance with any applicable blue sky securities
laws of any state of the United States.

         (d) [ ] CHECK IF EXCHANGE IS FROM RESTRICTED DEFINITIVE NOTE TO
UNRESTRICTED DEFINITIVE NOTE. In connection with the Owner's Exchange of a
Restricted Definitive Note for an Unrestricted Definitive Note, the Owner hereby
certifies (i) the Unrestricted Definitive Note is being acquired for the Owner's
own account without transfer, (ii) such Exchange has been effected in compliance
with the transfer restrictions applicable to Restricted Definitive Notes and
pursuant to and in accordance with the Securities Act, (iii) the restrictions on
transfer contained in the Indenture and the Private Placement Legend are not
required in order to maintain compliance with the Securities Act and (iv) the
Unrestricted Definitive Note is being acquired in compliance with any applicable
blue sky securities laws of any state of the United States.

         2. [ ] EXCHANGE OF RESTRICTED DEFINITIVE NOTES OR BENEFICIAL INTERESTS
         ----------------------------------------------------------------------
IN RESTRICTED GLOBAL NOTES FOR RESTRICTED DEFINITIVE NOTES OR BENEFICIAL
------------------------------------------------------------------------
INTERESTS IN RESTRICTED GLOBAL NOTES
------------------------------------

         (a) [ ] CHECK IF EXCHANGE IS FROM BENEFICIAL INTEREST IN A RESTRICTED
GLOBAL NOTE TO RESTRICTED DEFINITIVE NOTE. In connection with the Exchange of
the Owner's beneficial interest in a Restricted Global Note for a Restricted
Definitive Note with an equal principal amount, the Owner hereby certifies that
the Restricted Definitive Note is being acquired for the Owner's own account
without transfer. Upon consummation of the proposed Exchange in accordance with
the terms of the Indenture, the Restricted Definitive Note issued will continue
to be subject to the restrictions on transfer enumerated in the Private
Placement Legend printed on the Restricted Definitive Note and in the Indenture
and the Securities Act.

         (b) [ ] CHECK IF EXCHANGE IS FROM RESTRICTED DEFINITIVE NOTE TO
BENEFICIAL INTEREST IN A RESTRICTED GLOBAL NOTE. In connection with the Exchange
of the Owner's Restricted Definitive Note for a beneficial interest in the
[CHECK ONE] 144A Global Note, Regulation S Global Note with an equal principal
amount, the Owner hereby certifies (i) the beneficial interest is being acquired
for the Owner's own account without transfer and (ii) such Exchange has been
effected in compliance with the transfer restrictions applicable to the
Restricted Global Notes and pursuant to and in accordance with the Securities
Act, and in compliance with any applicable blue sky securities laws of any state
of the United States. Upon consummation of the proposed Exchange in accordance
with the terms of the Indenture, the beneficial interest issued will be subject
to the restrictions on transfer enumerated in the Private Placement Legend
printed on the relevant Restricted Global Note and in the Indenture and the
Securities Act.

         This certificate and the statements contained herein are made for your
benefit and the benefit of the Company.

                                          --------------------------------------
                                               [Insert Name of Transferor]

                                          By:
                                             -----------------------------------
                                             Name:
                                             Title:

Dated:
        -----------------------

                                      C-2
<PAGE>

                                                                       EXHIBIT D

                            FORM OF CERTIFICATE FROM
                   ACQUIRING INSTITUTIONAL ACCREDITED INVESTOR

Cole National Group, Inc.
5915 Landerbrook Drive
Mayfield Heights, Ohio 44124

Wells Fargo Bank Minnesota, N.A.
MAC N9303-110
Sixth and Marquette Avenue
Minneapolis, Minnesota 55479

         Re:  8 7/8% Senior Subordinated Notes
              --------------------------------
         Reference is hereby made to the Indenture, dated as of May 22, 2002
(the "Indenture"), between Cole National Group, Inc., as issuer (the "Company"),
and Wells Fargo Bank Minnesota, N.A., as trustee. Capitalized terms used but not
defined herein shall have the meanings given to them in the Indenture.

         In connection with our proposed purchase of $____________ aggregate
principal amount of:

         (a) [ ] a beneficial interest in a Global Note, or

         (b) [ ] a Definitive Note,

         we confirm that:

         1. We understand that any subsequent transfer of the Notes or any
interest therein is subject to certain restrictions and conditions set forth in
the Indenture and the undersigned agrees to be bound by, and not to resell,
pledge or otherwise transfer the Notes or any interest therein except in
compliance with, such restrictions and conditions and the Securities Act of
1933, as amended (the "Securities Act").

         2. We understand that the offer and sale of the Notes have not been
registered under the Securities Act, and that the Notes and any interest therein
may not be offered or sold except as permitted in the following sentence. We
agree, on our own behalf and on behalf of any accounts for which we are acting
as hereinafter stated, that if we should sell the Notes or any interest therein,
we will do so only (A) to the Company or any subsidiary thereof, (B) in
accordance with Rule 144A under the Securities Act to a "qualified institutional
buyer" (as defined therein), (C) to an institutional "accredited investor" (as
defined below) that, prior to such transfer, furnishes (or has furnished on its
behalf by a U.S. broker-dealer) to you and to the Company a signed letter
substantially in the form of this letter and if such transfer is in respect of a
principal amount of Notes, at the time of transfer of less than $250,000, an
Opinion of Counsel in form reasonably acceptable to the Company to the effect
that such transfer is in compliance with the Securities Act, (D) outside the
United States in accordance with Rule 904 of Regulation S under the Securities
Act, (E) pursuant to the provisions of Rule 144(k) under the Securities Act or
(F) pursuant to an effective registration statement under the Securities Act,
and we further agree to provide to any Person purchasing the Definitive Note or
beneficial interest in a Global Note from us in a transaction meeting the
requirements of clauses (A) through (E) of this paragraph a notice advising such
purchaser that resales thereof are restricted as stated herein.

                                      D-1
<PAGE>

         3. We understand that, on any proposed resale of the Notes or
beneficial interest therein, we will be required to furnish to you and the
Company such certifications, legal opinions and other information as you and the
Company may reasonably require to confirm that the proposed sale complies with
the foregoing restrictions. We further understand that the Notes purchased by us
will bear a legend to the foregoing effect.

         4. We are an institutional "accredited investor" (as defined in Rule
501(a)(1), (2), (3) or (7) of Regulation D under the Securities Act) and 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.

         5. We are acquiring the Notes or beneficial interest therein purchased
by us for our own account or for one or more accounts (each of which is an
institutional "accredited investor") as to each of which we exercise sole
investment discretion.

         You and the Company 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 proceedings or official inquiry with
respect to the matters covered hereby.

                                      ------------------------------------------
                                         [Insert Name of Accredited Investor]

                                      By:
                                         ---------------------------------------
                                         Name:
                                         Title:

Dated:
       ----------------------

                                      D-2
<PAGE>

                                                                       EXHIBIT E

                             FORM OF NOTE GUARANTEE

         For value received, each Guarantor (which term includes any successor
Person under the Indenture) has, jointly and severally, unconditionally
guaranteed, to the extent set forth in the Indenture and subject to the
provisions in the Indenture dated as of May 22, 2002 (the "Indenture") among
Cole National Group, Inc., a Delaware corporation (the "Company"), and Wells
Fargo Bank Minnesota, N.A., as trustee (the "Trustee"), (a) the due and punctual
payment of the principal of, premium and Liquidated Damages, if any, and
interest on the Notes (as defined in the Indenture), whether at maturity, by
acceleration, redemption or otherwise, the due and punctual payment of interest
on overdue principal of and interest on the Notes, if any, if lawful, and the
due and punctual performance of all other obligations of the Company to the
Holders or the Trustee all in accordance with the terms of the Indenture and (b)
in case of any extension of time of payment or renewal of any Notes or any of
such other obligations, that the same will be promptly paid in full when due or
performed in accordance with the terms of the extension or renewal, whether at
stated maturity, by acceleration or otherwise. The obligations of the Guarantors
to the Holders of Notes and to the Trustee pursuant to the Note Guarantee and
the Indenture are expressly set forth in Article 11 of the Indenture and
reference is hereby made to the Indenture for the precise terms of the Note
Guarantee. Each Holder of a Note, by accepting the same, (a) agrees to and shall
be bound by such provisions, (b) authorizes and directs the Trustee, on behalf
of such Holder, to take such action as may be necessary or appropriate to
effectuate the subordination as provided in the Indenture and (c) appoints the
Trustee attorney-in-fact of such Holder for such purpose; provided, however,
that the Indebtedness evidenced by this Note Guarantee shall cease to be so
subordinated and subject in right of payment upon any defeasance of this Note in
accordance with the provisions of the Indenture.

                                       [NAME OF GUARANTOR(S)]

                                       By:
                                          --------------------------------------
                                       Name:
                                       Title:

                                      E-1
<PAGE>

                                                                       EXHIBIT F

                         FORM OF SUPPLEMENTAL INDENTURE
                    TO BE DELIVERED BY SUBSEQUENT GUARANTORS

         SUPPLEMENTAL INDENTURE (this "Supplemental Indenture"), dated as of
________________, 200__, among __________________ (the "Guaranteeing
Subsidiary"), a subsidiary of Cole National Group, Inc. (or its permitted
successor), a Delaware corporation (the "Company"), the Company, the other
Guarantors (as defined in the Indenture referred to herein) and Wells Fargo Bank
Minnesota, N.A., as trustee under the indenture referred to below (the
"Trustee").

                               W I T N E S S E T H

         WHEREAS, the Company has heretofore executed and delivered to the
Trustee an indenture (the "Indenture"), dated as of May 22, 2002 providing for
the issuance of 8 7/8% Senior Subordinated Notes due 2012 (the "Notes");

         WHEREAS, the Indenture provides that under certain circumstances the
Guaranteeing Subsidiary shall execute and deliver to the Trustee a supplemental
indenture pursuant to which the Guaranteeing Subsidiary shall unconditionally
guarantee all of the Company's Obligations under the Notes and the Indenture on
the terms and conditions set forth herein (the "Note Guarantee"); and

         WHEREAS, pursuant to Section 9.01 of the Indenture, the Trustee is
authorized to execute and deliver this Supplemental Indenture.

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

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

         2. AGREEMENT TO GUARANTEE. The Guaranteeing Subsidiary hereby agrees to
provide an unconditional Guarantee on the terms and subject to the conditions
set forth in the Note Guarantee and in the Indenture, including but not limited
to Article 11 thereof.

         3. EXECUTION AND DELIVERY. Each Guaranteeing Subsidiary agrees that the
Note Guarantees shall remain in full force and effect notwithstanding any
failure to endorse on each Note a notation of such Note Guarantee.

         4. NO RECOURSE AGAINST OTHERS. No director, officer, employee,
incorporator, Affiliate or stockholder of the Company or any Guaranteeing
Subsidiary or other Guarantor, solely by reason of this status, will have any
liability for any obligations of the Company or the Guaranteeing Subsidiary or
other Guarantor under the Notes, this Indenture, any Note Guarantees, or for any
claim based on, in respect of, or by reason of, such obligations or their
creation. Each Holder of Notes by accepting a Note waives and releases all such
liability. The waiver and release are part of the consideration for issuance of
the Notes. The waiver may not be effective to waive liabilities under the
federal securities laws.

         5. NEW YORK LAW TO GOVERN. THE INTERNAL LAW OF THE STATE OF NEW YORK
SHALL GOVERN AND BE USED TO CONSTRUE THIS SUPPLEMENTAL INDENTURE BUT WITHOUT
GIVING EFFECT TO APPLICABLE PRINCIPLES OF CONFLICTS OF LAW TO

                                      F-1
<PAGE>

THE EXTENT THAT THE APPLICATION OF THE LAWS OF ANOTHER JURISDICTION WOULD BE
REQUIRED THEREBY.

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

         7. EFFECT OF HEADINGS. The Section headings herein are for convenience
only and shall not affect the construction hereof.

         8. THE TRUSTEE. The Trustee shall not be responsible in any manner
whatsoever for or in respect of the validity or sufficiency of this Supplemental
Indenture or for or in respect of the recitals contained herein, all of which
recitals are made solely by the Guaranteeing Subsidiary and the Company.

                                      F-2
<PAGE>

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

         Dated:  _______________, 20___

                                            [GUARANTEEING SUBSIDIARY]

                                            By:
                                                 -------------------------------
                                            Name:
                                            Title:

                                            COLE NATIONAL GROUP, INC.

                                            By:
                                                 -------------------------------
                                            Name:
                                            Title:

                                            [EXISTING GUARANTORS]

                                            By:
                                                 -------------------------------
                                            Name:
                                            Title:

                                            WELLS FARGO BANK MINNESOTA, N.A.,
                                              as Trustee

                                            By:
                                                 -------------------------------
                                                  Authorized Signatory

                                      F-3

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