Document:

exv10w2

 

Execution Version

Exhibit 10.2

INDENTURE

between

COMSTOCK HOMEBUILDING COMPANIES, INC.

and

WELLS FARGO BANK, N.A.,

as Trustee

 

Dated as of March 15, 2007

 

 

 

TABLE OF CONTENTS

	 	 	 	 	 	 	 
	 	 	 	 	Page	 
	ARTICLE I DEFINITIONS AND OTHER PROVISIONS OF GENERAL APPLICATION	 	 	1	 
	Section 1.1
	 	Definitions	 	 	1	 
	Section 1.2
	 	Compliance Certificate and Opinions	 	 	12	 
	Section 1.3
	 	Forms of Documents Delivered to Trustee	 	 	12	 
	Section 1.4
	 	Acts of Holders	 	 	13	 
	Section 1.5
	 	Notices, Etc. to Trustee and Company	 	 	15	 
	Section 1.6
	 	Notice to Holders; Waiver	 	 	15	 
	Section 1.7
	 	Effect of Headings and Table of Contents	 	 	16	 
	Section 1.8
	 	Successors and Assigns	 	 	16	 
	Section 1.9
	 	Separability	 	 	16	 
	Section 1.10
	 	Benefits of Indenture	 	 	16	 
	Section 1.11
	 	Governing Law	 	 	16	 
	Section 1.12
	 	Submission to Jurisdiction	 	 	16	 
	Section 1.13
	 	Non-Business Days	 	 	17	 
	Section 1.14
	 	Counterparts	 	 	17	 
	 
	 	 	 	 	 	 
	ARTICLE II SENIOR NOTE FORMS	 	 	17	 
	Section 2.1
	 	Form of Senior Note	 	 	17	 
	Section 2.2
	 	Restrictive Legend	 	 	22	 
	Section 2.3
	 	Form of Trustee’s Certificate of Authentication	 	 	24	 
	Section 2.4
	 	Temporary Senior Notes	 	 	25	 
	Section 2.5
	 	Definitive Senior Notes	 	 	25	 
	 
	 	 	 	 	 	 
	ARTICLE III THE SENIOR NOTES	 	 	26	 
	Section 3.1
	 	Payment of Principal and Interest	 	 	26	 
	Section 3.2
	 	Denominations	 	 	28	 
	Section 3.3
	 	Execution, Authentication, Delivery and Dating	 	 	28	 
	Section 3.4
	 	Global Senior Notes	 	 	29	 
	Section 3.5
	 	Registration, Transfer and Exchange Generally	 	 	31	 
	Section 3.6
	 	Mutilated, Destroyed, Lost and Stolen Senior Notes	 	 	32	 
	Section 3.7
	 	Persons Deemed Owners	 	 	33	 
	Section 3.8
	 	Cancellation	 	 	33	 
	Section 3 9
	 	Agreed Tax Treatment	 	 	33	 
	Section 3.10
	 	CUSIP Numbers	 	 	34	 
	 
	 	 	 	 	 	 
	ARTICLE IV SATISFACTION AND DISCHARGE	 	 	34	 
	Section 4.1
	 	Satisfaction and Discharge of Indenture	 	 	34	 
	Section 4.2
	 	Application of Trust Money	 	 	35	 
	 
	 	 	 	 	 	 
	ARTICLE V REMEDIES	 	 	35	 
	Section 5.1
	 	Events of Default	 	 	35	 
	Section 5.2
	 	Acceleration of Maturity; Rescission and Annulment	 	 	36	 

 

 

	 	 	 	 	 	 	 
	 	 	 	 	Page	 
	Section 5.3
	 	Collection of Indebtedness and Suits for Enforcement by Trustee	 	 	37	 
	Section 5.4
	 	Trustee May File Proofs of Claim 	 	 	38	 
	Section 5.5
	 	Trustee May Enforce Claim Without Possession of Senior Notes	 	 	38	 
	Section 5.6
	 	Application of Money Collected 	 	 	38	 
	Section 5.7
	 	Limitation on Suits 	 	 	39	 
	Section 5.8
	 	Unconditional Right of Holders to Receive Principal, Premium, if any, and Interest	 	 	40	 
	Section 5.9
	 	Restoration of Rights and Remedies 	 	 	40	 
	Section 5.10
	 	Rights and Remedies Cumulative 	 	 	40	 
	Section 5.11
	 	Delay or Omission Not Waiver 	 	 	40	 
	Section 5.12
	 	Control by Holders 	 	 	40	 
	Section 5.13
	 	Waiver of Past Defaults 	 	 	41	 
	Section 5.14
	 	Undertaking for Costs 	 	 	41	 
	Section 5.15
	 	Waiver of Usury, Stay or Extension Laws 	 	 	42	 
	 
	 	 	 	 	 	 
	ARTICLE VI THE TRUSTEE	 	 	42	 
	Section 6.1
	 	Corporate Trustee Required 	 	 	42	 
	Section 6.2
	 	Certain Duties and Responsibilities 	 	 	42	 
	Section 6.3
	 	Notice of Defaults 	 	 	43	 
	Section 6.4
	 	Certain Rights of Trustee 	 	 	44	 
	Section 6.5
	 	May Hold Senior Notes 	 	 	46	 
	Section 6.6
	 	Compensation; Reimbursement; Indemnity 	 	 	46	 
	Section 6.7
	 	Resignation and Removal; Appointment of Successor 	 	 	47	 
	Section 6.8
	 	Acceptance of Appointment by Successor 	 	 	47	 
	Section 6.9
	 	Merger, Conversion, Consolidation or Succession to Business	 	 	48	 
	Section 6.10
	 	Not Responsible for Recitals or Issuance of Senior Notes 	 	 	48	 
	Section 6.11
	 	Appointment of Authenticating Agent 	 	 	48	 
	 
	 	 	 	 	 	 
	ARTICLE VII HOLDER’S LISTS AND REPORTS BY COMPANY	 	 	50	 
	Section 7.1
	 	Company to Furnish Trustee Names and Addresses of Holders	 	 	50	 
	Section 7.2
	 	Preservation of Information, Communications to Holders 	 	 	50	 
	Section 7.3
	 	Reports by Company 	 	 	51	 
	 
	 	 	 	 	 	 
	ARTICLE VIII CONSOLIDATION, MERGER, CONVEYANCE, TRANSFER OR LEASE	 	 	52	 
	Section 8.1
	 	Company May Consolidate, Etc., Only on Certain Terms 	 	 	52	 
	Section 8.2
	 	Successor Company Substituted 	 	 	52	 
	 
	 	 	 	 	 	 
	ARTICLE IX SUPPLEMENTAL INDENTURES	 	 	53	 
	Section 9.1
	 	Supplemental Indentures without Consent of Holders 	 	 	53	 
	Section 9.2
	 	Supplemental Indentures with Consent of Holders 	 	 	54	 
	Section 9.3
	 	Execution of Supplemental Indentures 	 	 	54	 
	Section 9.4
	 	Effect of Supplemental Indentures 	 	 	55	 

ii

 

	 	 	 	 	 	 	 
	 	 	 	 	Page	 
	Section 9.5
	 	Reference in Senior Notes to Supplemental Indentures	 	 	55	 
	 
	 	 	 	 	 	 
	ARTICLE X COVENANTS	 	 	55	 
	Section 10.1
	 	Payment of Principal, Premium, if any, and Interest	 	 	55	 
	Section 10.2
	 	Money for Senior Note Payments to be Held in Trust	 	 	55	 
	Section 10.3
	 	Statement as to Compliance	 	 	56	 
	Section 10.4
	 	Calculation Agent	 	 	57	 
	Section 10.5
	 	Additional Covenants	 	 	57	 
	Section 10.6
	 	Waiver of Covenants	 	 	59	 
	Section 10.7
	 	Treatment of Senior Notes	 	 	60	 
	Section 10.8
	 	Limitation on Issuance of Securities	 	 	60	 
	 
	 	 	 	 	 	 
	ARTICLE XI REDEMPTION OF SENIOR NOTES	 	 	60	 
	Section 11.1
	 	Optional Redemption and Mandatory Redemptions	 	 	60	 
	Section 11.2
	 	Special Event Redemption	 	 	61	 
	Section 11.3
	 	Election to Redeem; Notice to Trustee	 	 	61	 
	Section 11.4
	 	Selection of Senior Notes to be Redeemed	 	 	61	 
	Section 11.5
	 	Notice of Redemption	 	 	62	 
	Section 11.6
	 	Deposit of Redemption Price	 	 	63	 
	Section 11.7
	 	Payment of Senior Notes Called for Redemption	 	 	63	 
	 
	 	 	 	 	 	 
	ARTICLE XII RESERVED	 	 	63	 
	 
	 	 	 	 	 	 
	ARTICLE XIII DEFEASANCE	 	 	68	 
	Section 13.1
	 	Defeasance and Discharge	 	 	68	 
	Section 13.2
	 	Conditions to Defeasance	 	 	69	 
	Section 13.3
	 	Deposited Money and U.S. Government Obligations to be Held in Trust; Other Miscellaneous Provisions	 	 	70	 
	Section 13.4
	 	Reinstatement	 	 	70	 

	 	 	 	 	 
	SCHEDULE AND EXHIBIT
	 
	 	 	 	 
	Schedule A

	 	-
	 	Determination of LIBOR
	 
	 	 	 	 
	Exhibit A

	 	-
	 	Form of Officer’s Financial Certificate pursuant to Section 7.3(b)
	 
	 	 	 	 
	Exhibit B

	 	-
	 	Form of Officer’s Certificate pursuant to Section 10.3

iii

 

INDENTURE

     This INDENTURE, dated as of March 15, 2007, is between Comstock Homebuilding Companies, Inc.,
a Delaware corporation (the “Company”), and Wells Fargo Bank, N.A., as Trustee (in such capacity,
the “Trustee”).

RECITALS OF THE COMPANY

     WHEREAS, the Company has duly authorized the execution and delivery of this Indenture to
provide for the issuance of its senior unsecured notes, and to provide the terms and conditions
upon which such senior unsecured notes are to be authenticated, issued and delivered; and

     WHEREAS, all things necessary to make this Indenture a valid agreement of the Company, in
accordance with its terms, have been done.

     NOW, THEREFORE, THIS INDENTURE WITNESSETH:

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

ARTICLE I

     DEFINITIONS AND OTHER PROVISIONS OF GENERAL APPLICATION

     Section 1.1 Definitions.

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

     (a) the terms defined in this Article I have the meanings assigned to them in this
Article I;

     (b) the words “include,” “includes” and “including” shall be deemed to be followed by the
phrase “without limitation”;

     (c) all accounting terms used but not defined herein have the meanings assigned to them in
accordance with GAAP;

     (d) unless the context otherwise requires, any reference to an “Article,” a “Section,” a
“Schedule” or an “Exhibit” refers to an Article, a Section, a Schedule or an Exhibit, as the case
may be, of or to this Indenture;

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

 

 

     (f) a reference to the singular includes the plural and vice versa; and

     (g) the masculine, feminine or neuter genders used herein shall include the masculine,
feminine and neuter genders.

     “Acceptable Repurchase” has the meaning specified in Section 10.5(g).

     “Acceptable Repurchase Mandatory Redemption Price” has the meaning set forth in
Section 11.1(d).

     “Act” when used with respect to any Holder, has the meaning specified in Section
1.4(a).

     “Additional Interest” means the interest, if any, that shall accrue on any amounts
payable on the Senior Notes, the payment of which has not been made on the applicable Interest
Payment Date and which shall accrue at the rate per annum specified or determined as specified in
such Senior Note, in each case to the extent legally enforceable.

     “Affiliate” of any specified Person means any other Person directly or indirectly controlling
or controlled by or under direct or indirect common control with such specified Person. For the
purposes of this definition, “control,” when used with respect to any specified Person, means the
power to direct the management and policies of such Person, directly or indirectly, whether
through the ownership of voting securities, by contract or otherwise; and the terms “controlling”
and “controlled” have meanings correlative to the foregoing.

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

     “Authenticating Agent” means any Person authorized by the Trustee pursuant to
Section 6.11 to act on behalf of the Trustee to authenticate the Senior Notes.

     “Board of Directors” means the board of directors of the Company or any duly
authorized committee of that board.

     “Board Resolution” means a copy of a resolution certified by the Secretary or an
Assistant Secretary of the Company to have been duly adopted by the Board of Directors and to be
in full force and effect on the date of such certification.

     “Breakage Costs” means any and all reasonable costs and fees of any Holder of Senior Notes
(including, without limitation, the reasonable fees and expenses of any counsel engaged by such
Holder to enforce the obligations of the Company hereunder) (as determined by such Holder),
directly associated or incurred in connection with unwinding, terminating, modifying or otherwise
breaking of any interest rate swap or other interest rate hedging arrangement entered into with
respect to the interest rate on the Senior Notes prior to the expiration of the Fixed Rate Period
where such unwinding, termination, modification or breaking is caused by the payment or defeasance
of principal on the Senior Notes prior to the expiration of the Fixed Rate Period in connection
with a Change-of-Control Election.

2

 

     “Breakage Gains” means the amount of gain actually realized by any Holder of Senior Notes (as
determined by such Holder), directly associated or incurred in connection with unwinding,
terminating, modifying or otherwise breaking any interest rate swap or other interest rate hedging
arrangement entered into with respect to the interest rate on the Senior Notes prior to the
expiration of the Fixed Rate Period where such unwinding, termination, modification or breaking is
caused by the payment or defeasance of principal on the Senior Notes prior to the expiration of
the Fixed Rate Period in connection with a Change-of-Control Election.

     “Business Day” means any day other than (i) a Saturday or Sunday, (ii) a day on which banking
institutions in the City of New York are authorized or required by law or executive order to
remain closed or (iii) a day on which the Corporate Trust Office of the Trustee is closed for
business.

     “Calculation Agent” has the meaning specified in Section 10.4(a).

     “Capital Lease” means lease of (or other agreement conveying the right to use) any real or
personal property by a Person that, in conformity with GAAP, is accounted for as a capital lease
on the balance sheet of such Person

     “Change-of-Control” means (i) any person (as such term is used in Sections 13(d) and
14(d) of the Exchange Act), including a “group” as defined in Section 13(d)(3) of the Exchange Act
(but excluding a director or other fiduciary holding securities under an employee benefit plan of
the Company), becomes the beneficial owner of Equity Interests of the Company having at least fifty
percent (50%) of the total number of votes that may be cast for the election of directors of the
Company; (ii) the merger or other business combination of the Company, sale of all or substantially
all of the Company’s assets or combination of the foregoing transactions (a “Transaction”), other
than a Transaction immediately following which the shareholders of the Company immediately prior to
the Transaction continue to have a majority of the voting power in the resulting entity (excluding
for this purpose any shareholder owning directly or indirectly more than ten percent (10%) of the
shares of the other company involved in the Transaction); or (iii) the persons who were directors
of the Company on the date hereof (the “Incumbent Directors”) shall cease to constitute at least a
majority of the Board or a majority of the board of directors of any successor to the Company;
provided, that, any director who was not a director as of the date hereof shall be deemed
to be an Incumbent Director if such director was elected to the Board by, or on the recommendation
of or with the approval of, at least two-thirds of the directors who then qualified as Incumbent
Directors either actually or by prior operation of this provision, unless such election,
recommendation or approval was the result of an actual or threatened election contest of the type
contemplated by Regulation 14a-11 promulgated under the Exchange Act or any successor provision.

     “Change-of-Control Election” has the meaning specified in Section 10.5(b).

     “Change-of-Control Event” means the occurrence of (i) a Change-of-Control and (ii) a
Ratings Downgrade.

     “Change-of-Control Event Notice” has the meaning specified in Section
10.5(b).

3

 

     “Change-of-Control Mandatory Redemption Price” has the meaning set forth in
Section 11.1(b).

     “Change-of-Control Notice” has the meaning specified in Section 10.5(b).

     “Code” means the Internal Revenue Code of 1986 or any successor statute thereto, in each case
as amended from time to time.

     “Commission” has the meaning specified in Section 7.3(c).

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

     “Company
Request” and “Company Order” mean, respectively, the written request or
order signed in the name of the Company by its Chairman of the Board of Directors, its Vice
Chairman of the Board of Directors, its Chief Executive Officer, President or a Vice President,
and by its Chief Financial Officer, its Treasurer, an Assistant Treasurer, its Secretary or an
Assistant Secretary, and delivered to the Trustee.

     “Consolidated Tangible Net Worth” means (i) the consolidated net worth of the Company
and its consolidated subsidiaries minus (ii) the consolidated intangibles of the Company and its
consolidated subsidiaries including, without limitation, goodwill, trademarks, trade names,
copyrights, patents, patent applications, licenses, and rights in any of the foregoing and other
items treated as intangibles in accordance with generally accepted accounting principles.

     “Control Agreement” means that certain Interest Reserve Account Control Agreement
dated the date hereof wherein the Company grants a security interest in the Interest Reserve
Account to the Trustee, as security trustee for the benefit of the Holders.

     “Corporate Trust Office” means the principal office of the Trustee at which at any
particular time its corporate trust business shall be administered, which office at the date of
this Indenture is located at 919 North Market Street, Suite 1600, Wilmington, Delaware 19801.

     “Debt” means, with respect to any Person, whether recourse is to all or a portion of the
assets of such Person, whether currently existing or hereafter incurred and whether or not
contingent and without duplication, (i) every obligation of such Person for money borrowed; (ii)
every obligation of such Person evidenced by bonds, debentures, notes or other similar instruments,
including obligations incurred in connection with the acquisition of property, assets or
businesses; (iii) every reimbursement obligation of such Person with respect to letters of credit,
bankers’ acceptances or similar facilities issued for the account of such Person; (iv) every
obligation of such Person issued or assumed as the deferred purchase price of property or services
(but excluding trade accounts payable or other accrued liabilities arising in the ordinary course
of business); (v) every capital lease obligation of such Person; (vi) all indebtedness of such
Person, whether incurred on or prior to the date of this Indenture or thereafter incurred, for
claims in respect of derivative products, including interest rate, foreign exchange rate and
commodity forward contracts, options and swaps and similar arrangements; (vii) every obligation of
the type referred to in clauses (i) through (vi) of another Person and all dividends of

4

 

another Person the payment of which, in either case, such Person has guaranteed or is responsible
or liable for, directly or indirectly, as obligor or otherwise; and (viii) any renewals,
extensions, refundings, amendments or modifications of any obligation of the types referred to in
clauses (i) through (vii).

     “Defaulted Interest” has the meaning specified in Section 3.1(c).

     “Defeasance” has the meaning specified in Section 13.1.

     “Defeasance Maturity Date” has the meaning specified in Section 13.2.

     “Defeasance Senior Notes” has the meaning specified in Section 13.1.

     “Depositary” means an organization registered as a clearing agency under the Exchange Act
that is designated as Depositary by the Company or any successor thereto. DTC will be the initial
Depositary.

     “Depositary Participant” means a broker, dealer, bank, other financial institution or
other Person for whom from time to time a Depositary effects book-entry transfers and pledges of
securities deposited with the Depositary.

     “Dollar” or “$” means the currency of the United States of America that, as at the time of
payment, is legal tender for the payment of public and private debts.

     “DTC” means The Depository Trust Company, a New York corporation, or any successor thereto.

     “EBITDA” means, for any period, the net income (or loss) of the Company and its Subsidiaries
for such period, excluding (a) any gains from the sale, lease, assignment or other transfer
for value (each, a “Disposition”) by the Company or any Subsidiary to any Person (other than the
Company or any Subsidiary) of any asset or right of the Company or such Subsidiary (including, the
loss, destruction or damage of any thereof or any actual or threatened (in writing to the Company
or any Subsidiary) condemnation, confiscation, requisition, seizure or taking thereof) other than
(i) the Disposition of any asset which is to be replaced, and is in fact replaced, within thirty
(30) days with another asset performing the same or a similar function, (ii) the sale or lease of
inventory in the ordinary course of business and (iii) other Dispositions in any fiscal year the
aggregate cash proceeds (including cash proceeds received pursuant to policies of insurance or by
way of deferred payment of principal pursuant to a note, installment receivable or otherwise, but
only as and when received) received by the Company or any Subsidiary pursuant to such Disposition
net of (A) the direct costs relating to such sale, transfer or other disposition (including sales
commissions and legal, accounting and investment banking fees),
(B) taxes paid or reasonably estimated by the Company to be payable as a result thereof (after
taking into account any available tax credits or deductions and any tax sharing arrangements) and
(C) amounts required to be applied to the repayment of any Debt secured by a Lien on the asset
subject to such Disposition (other than the Senior Notes) do not in the aggregate exceed
$1,000,000, (b) any extraordinary gains not related to the extinguishment of debt, (c) any gains
from discontinued operations and (d) with respect to calculating the Fixed Charge Coverage Ratio in
connection with Section 10.5(e)(i), (ii) and (iii) only, the aggregate amount of all other

5

 

non-cash items reducing net income (including any non-cash charge incurred as a result of a
permanent write-down or impairment of an asset) for such period, plus, to the extent
deducted in determining such net income (or loss), Interest Expense, income tax expense,
depreciation and amortization and non-cash management compensation expense for such period.

     “EDGAR” has the meaning specified in Section 7.3(c).

     “Equity Interests” means (a) the partnership interests (both common and preferred partnership
interests) in a partnership (whether a general or limited partnership), (b) the membership
interests in a limited liability company (both common and preferred membership interests) and (c)
the shares or stock interest (both common stock and preferred stock) in a corporation.

     “ERISA” means the Employee Retirement Income Security Act of 1974 or any successor statute
thereto, in each case as amended from time to time.

     “Event of Default” has the meaning specified in Section 5.1.

     “Exchange Act” means the Securities Exchange Act of 1934 or any successor statute thereto, in
each case as amended from time to time.

     “Expiration Date” has the meaning specified in Section 1.4(h).

     “Fixed Rate Period” shall have the meaning specified in the form of Senior Note set
forth in Section 2.1.

     “Fixed Charge Coverage Ratio” means, for each period of determination, which period
shall be either the four consecutive fiscal quarters or the one fiscal quarter ending on the last
day of a particular fiscal quarter as otherwise indicated herein, the ratio of (a) the total for
such period of EBITDA minus the sum of (i) net income taxes paid in cash by the Company
and each of its Subsidiaries and (ii) all unfinanced expenditures which, in accordance with GAAP,
would be required to be capitalized and shown on the consolidated balance sheet of the Company,
including expenditures in respect of any Capital Lease to (b) the sum for such period of (i) cash
Interest Expense plus (ii) required payments of principal of all Debt of the Company and
its Subsidiaries that matures more than one year from the date of its creation (or is renewable or
extendible, at the option of such Person, to a date more than one year from such date) (including
the Senior Notes) plus (iii) management fees paid in cash.

     “GAAP” means United States generally accepted accounting principles, consistently applied,
from time to time in effect.

     “Global Senior Note” means a Senior Note that evidences all or part of the Senior
Notes, the ownership and transfers of which shall be made through book entries by a Depositary.

     “Government Obligation” means (a) any security that is (i) a direct obligation of the
United States of America of which the full faith and credit of the United States of America is
pledged or (ii) an obligation of a Person controlled or supervised by and acting as an agency or
instrumentality of the United States of America or the payment of which is unconditionally

6

 

guaranteed as a full faith and credit obligation by the United States of America, which, in either
case of clause (i) or (ii), is not callable or redeemable at the option of the issuer thereof, and
(b) any depositary receipt issued by a “bank” (as defined in Section 3(a)(2) of the Securities
Act) as custodian with respect to any Government Obligation that is specified in clause (a) above
and held by such bank for the account of the holder of such depositary receipt, or with respect to
any specific payment of principal of or interest on any Government Obligation that is so specified
and held; provided, that (except as required by law) such custodian is not authorized to
make any deduction from the amount payable to the holder of such depositary receipt from any
amount received by the custodian in respect of the Government Obligation or the specific payment
of principal or interest evidenced by such depositary receipt.

     “Holder” means a Person in whose name a Senior Note is registered in the Securities Register.

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

     “Interest Expense” means consolidated interest expense of the Company and its
Subsidiaries for such period (including all imputed interest on Capital Leases)

     “Interest Payment Date” means March 30, June 30, September 30 and December 30 of each
year, commencing on March 30, 2007 during the term of this Indenture.

     “Interest Reserve Account” means an account of the Company at Wells Fargo Bank, N.A.
subject to the limitations set forth in Section 10.5(f) and subject to the lien of the
Control Agreement.

     “Investment Company Act” means the Investment Company Act of 1940 or any successor
statute thereto, in each case as amended from time to time.

     “Investment Company Event” means the receipt by the Company of an Opinion of Counsel
experienced in such matters to the effect that, as a result of the occurrence of a change in law or
regulation (including any announced prospective change) or a written change in interpretation or
application of law or regulation by any legislative body, court, governmental agency or regulatory
authority, there is more than an insubstantial risk that the Company is or, within ninety (90) days
of the date of such opinion will be, considered an “investment company” that is required to be
registered under the Investment Company Act, which change or prospective change becomes effective
or would become effective, as the case may be, on or after the date of the issuance of the Senior
Notes.

     “Leverage Ratio” means at any time, the ratio of Debt of the Company (excluding obligations
related to inventory not owned resulting from consolidations required pursuant to Financial
Accounting Standards Board Interpretation No. 46 entitled “Consolidation of Variable Interest
Entities, an Interpretation of Accounting Research Bulletin (ARB) No. 51” issued in January 2003
and revised December 2003, as the same may be revised and amended from time to time) at such time
to Consolidated Tangible Net Worth (as reported in the Company’s balance

7

 

sheet contained in the most recent periodic report filed with the Commission) for the most
recently ended four fiscal quarters of the Company.

     “LIBOR” has the meaning specified in Schedule A.

     “LIBOR Business Day” has the meaning specified in Schedule A.

     “LIBOR Determination Date” has the meaning specified in Schedule A.

     “Maturity,” when used with respect to any Senior Note, means the date on which the principal
of such Senior Note or any installment of principal becomes due and payable as therein or herein
provided, whether at the Stated Maturity or by declaration of acceleration, call for redemption or
otherwise.

     “Notice of Default” means a written notice of the kind specified in Section
5.1(c).

     “Officers’ Certificate” means a certificate signed by the Chairman of the Board, a
Vice Chairman of the Board, the Chief Executive Officer, the President or a Vice President, and by
the Chief Financial Officer, the Treasurer, an Assistant Treasurer, the Secretary or an Assistant
Secretary, of the Company and delivered to the Trustee.

     “Opinion of Counsel” means a written opinion of counsel, who may be counsel for or an
employee of the Company or any Affiliate of the Company.

     “Optional Redemption Price” has the meaning set forth in Section 11.1.

     “Original Issue Date” means the date of original issuance of each Senior Note.

     “Outstanding” means, when used in reference to any Senior Notes, as of the date of
determination, all Senior Notes theretofore authenticated and delivered under this Indenture,
except:

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

     (ii) Senior Notes for whose payment or redemption money in the necessary amount
has been theretofore deposited with the Trustee or any Paying Agent (other than the
Company) in trust or set aside and segregated in trust by the Company (if the
Company and/or its Affiliate shall act as its own Paying Agent) for the Holders of
such Senior Notes; provided, that if the Company is acting as Paying Agent,
Senior Notes for which payment or redemption money has been so deposited in trust
with the Paying Agent shall be considered to remain Outstanding until such time as
such payment or redemption money has actually been paid in full to the Holders of
such Senior Notes; and provided, further, that, if such Senior Notes are to
be redeemed, notice of such redemption has been duly given pursuant to this
Indenture or provision therefor satisfactory to the Trustee has been made; and

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     (iii) Senior Notes that have been paid or in substitution for or in lieu of
which other Senior Notes have been authenticated and delivered pursuant to the
provisions of this Indenture, unless proof satisfactory to the Trustee is presented
that any such Senior Notes are held by Holders in whose hands such Senior Notes are
valid, binding and legal obligations of the Company;

provided, that in determining whether the Holders of the requisite principal amount of
Outstanding Senior Notes have given any request, demand, authorization, direction, notice, consent
or waiver hereunder, Senior Notes owned by the Company or any other obligor upon the Senior Notes
or any Affiliate of the Company or such other obligor shall be disregarded and deemed not to be
Outstanding unless the Company shall hold all Outstanding Senior Notes, except that, in determining
whether the Trustee shall be protected in relying upon any such request, demand, authorization,
direction, notice, consent or waiver, only Senior Notes that a Responsible Officer of the Trustee
actually knows to be so owned shall be so disregarded. Senior Notes so owned that have been pledged
in good faith may be regarded as Outstanding if the pledgee establishes to the satisfaction of the
Trustee the pledgee’s right so to act with respect to such Senior Notes and that the pledgee is not
the Company or any other obligor upon the Senior Notes or any Affiliate of the Company or such
other obligor.

     “Paying Agent” means the Trustee or any Person authorized by the Company to pay the principal
of or any premium or interest on, or other amounts in respect of, any Senior Notes on behalf of
the Company.

     “Permitted Debt” means the principal of and any premium and interest on (including interest
accruing on or after the filing of any petition in bankruptcy or for reorganization relating to
the Company, whether or not such claim for post-petition interest is allowed in such proceeding)
all Debt of the Company, whether incurred on or prior to the date of this Indenture or thereafter
incurred, to the extent such Debt is (i) secured by (or has provisions in the loan documentation
of such Debt permitting, upon the occurrence of an “event of default” (as defined in such loan
documentation), such debt to become secured by) real property or membership interests of
Subsidiaries of the Company the assets of which primarily consist of real property or, (ii) Debt
of a Subsidiary of the Company which is secured by real property and which the Company has
guaranteed or is responsible or liable for, directly or indirectly, as obligor or otherwise, (iii)
“working capital” or “revolving” lines of credit with terms of three (3) years or less.

     “Person” means a legal person, including any individual, corporation, estate, partnership
(general or limited), joint venture, association, joint stock company, company, limited liability
company, trust, unincorporated association or government, or any agency or political subdivision
thereof, or any other entity of whatever nature.

     “Place of Payment” means, with respect to the Senior Notes, the Corporate Trust
Office of the Trustee.

     “Predecessor Senior Note” of any particular Senior Note means every previous Senior
Note evidencing all or a portion of the same debt as that evidenced by such particular Senior
Note. For the purposes of this definition, any security authenticated and delivered under
Section

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3.6 in lieu of a mutilated, destroyed, lost or stolen Senior Note shall be deemed to
evidence the same debt as the mutilated, destroyed, lost or stolen Senior Note.

     “Proceeding” has the meaning specified in Section 12.2(b).

     “Purchase Agreement” means the Senior Note Purchase and Redemption Agreement, dated
as of the date hereof, between the Company, Kodiak Warehouse LLC and the Purchaser.

     “Purchaser” means Kodiak Warehouse JPM LLC, a Delaware limited liability company.

     “Put Election Notice” means written notice delivered to the Company and the Trustee
by the Purchaser (or any Affiliate transferee thereof) after September 30, 2007, pursuant to which
the Purchaser or such Affiliate transferee elects to cause the Company to redeem a portion of the
Senior Notes held by the Purchaser or such Affiliate transferee in an aggregate principal amount
not to exceed Two Million Dollars ($2,000,000).

     “Put Mandatory Redemption Price” has the meaning set forth in Section 11.1(c).

     “Rating Agencies” shall mean (i) Standard & Poor’s Ratings Group, a division of The
McGraw-Hill Companies, Inc., (ii) Moody’s Investor Services, Inc. and (iii) Fitch/IBCA, or, in
each case its respective successor.

     “Ratings Downgrade” means a downgrading in or withdrawal of the Company’s general
corporate rating or the rating accorded to the Company’s debt securities or preferred stock, if
any, by any two of the Rating Agencies as a result of a Change-of-Control.

     “Redemption Date” means, when used with respect to any Senior Note to be redeemed,
the date fixed for such redemption by or pursuant to this Indenture.

     “Redemption Price” means, when used with respect to any Senior Note to be redeemed,
in whole or in part, the Special Redemption Price, the Acceptable Repurchase Mandatory Redemption
Price, the Put Mandatory Redemption Price, the Change-of-Control Mandatory Redemption Price or the
Optional Redemption Price, as applicable, at which such Senior Note or portion thereof is to be
redeemed as fixed by or pursuant to this Indenture.

     “Reference Banks” has the meaning specified in Schedule A.

     “Regular Record Date” for the interest payable on any Interest Payment Date with
respect to the Senior Notes means the date that is fifteen (15) days preceding such Interest
Payment Date (whether or not a Business Day).

     “Responsible Officer” means, when used with respect to the Trustee, the officer in the
corporate trust department of the Trustee having direct responsibility for the administration of
this Indenture.

     “Rights Plan” means a plan of the Company providing for the issuance by the Company to all
holders of its common Equity Interests of rights entitling the holders thereof to subscribe for or
purchase shares or units of any class or series of Equity Interests in the Company which

10

 

rights (i) are deemed to be transferred with such Equity Interests and (ii) are also issued in
respect of future issuances of such Equity Interests, in each case until the occurrence of a
specified event or events.

     “Securities Act” means the Securities Act of 1933 or any successor statute thereto, in each
case as amended from time to time.

     “Securities Register” and “Securities Registrar” have the respective meanings
specified in Section 3.5(a).

     “Senior Notes” or “Senior Note” means any debt securities or debt security, as the case may
be, authenticated and delivered under this Indenture.

     “Special Event” means the occurrence of an Investment Company Event or a Tax Event.

     “Special Record Date” for the payment of any Defaulted Interest means a date fixed by
the Trustee pursuant to Section 3.1(c).

     “Special
Redemption Price” has the meaning set forth in
Section 11.2.

     
“Stated Maturity” means March 30, 2017.

     “Subsidiary” means a Person more than fifty percent (50%) of the outstanding voting stock or
other voting interests of which is owned, directly or indirectly, by the Company or by one or more
other Subsidiaries, or by the Company and one or more other Subsidiaries. For purposes of this
definition, “voting stock” means stock that ordinarily has voting power for the election of
directors, whether at all times or only so long as no senior class of stock has such voting power
by reason of any contingency.

     “Tax Event” means the receipt by the Company of an Opinion of Counsel experienced in such
matters to the effect that, as a result of (a) any amendment to or change (including any announced
prospective change) in the laws or any regulations thereunder of the United States or any
political subdivision or taxing authority thereof or therein or (b) any judicial decision or any
official administrative pronouncement (including any private letter ruling, technical advice
memorandum or field service advice) or regulatory procedure, including any notice or announcement
of intent to adopt any such pronouncement or procedure (an “Administrative Action”),
regardless of whether such judicial decision or Administrative Action is issued to or in
connection with a proceeding involving the Company and whether or not subject to review or appeal,
which amendment, change, judicial decision or Administrative Action is enacted, promulgated or
announced, in each case, on or after the date of issuance of the Senior Notes, there is more than
an insubstantial risk that interest payable by the Company on the Senior Notes is not, or within
ninety (90) days of the date of such opinion, will not be, deductible by the Company, in whole or
in part, for United States federal income tax purposes.

     “Trustee” means the Person named as the “Trustee” in the first paragraph of this Indenture,
solely in its capacity as such and not in its individual capacity, until a successor Trustee shall
have become such pursuant to the applicable provisions of this Indenture, and, thereafter,
“Trustee” shall mean or include each Person who is then a Trustee hereunder.

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     “Trust Indenture Act” means the Trust Indenture Act of 1939 or any successor statute
thereto, in each case as amended from time to time.

     Section 1.2 Compliance Certificate and Opinions.

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

     (b) Every certificate or opinion with respect to compliance with a condition or covenant
provided for in this Indenture (other than the certificate provided pursuant to Section 10.3) shall include:

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

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

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

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

     Section 1.3 Forms of Documents Delivered to Trustee.

     (a) In any case where several matters are required to be certified by, or covered by an
opinion of, any specified Person, it is not necessary that all such matters be certified by, or
covered by the opinion of, only one such Person, or that they be so certified or covered by only
one document, but one such Person may certify or give an opinion with respect to some matters and
one or more other such Persons as to other matters, and any such Person may certify or give an
opinion as to such matters in one or several documents.

     (b) Any certificate or opinion of an officer of the Company may be based, insofar as it
relates to legal matters, upon a certificate or opinion of, or representations by, counsel, unless
such officer knows, or after reasonable inquiry should know, that the certificate or opinion or
representations with respect to matters upon which his or her certificate or opinion is based are
erroneous. Any such certificate or Opinion of Counsel may be based, insofar as it relates to

12

 

factual matters, upon a certificate or opinion of, or representations by, an officer or officers
of the Company stating that the information with respect to such factual matters is in the
possession of the Company, unless such counsel knows, or after reasonable inquiry should know,
that the certificate or opinion or representations with respect to such matters are erroneous.

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

     (d) Whenever, subsequent to the receipt by the Trustee of any Board Resolution, Officers’
Certificate, Opinion of Counsel or other document or instrument, a clerical,
typographical or other inadvertent or unintentional error or omission shall be discovered therein,
a new document or instrument may be substituted therefor in corrected form with the same force and
effect as if originally received in the corrected form and, irrespective of the date or dates of
the actual execution and/or delivery thereof, such substitute document or instrument shall be
deemed to have been executed and/or delivered as of the date or dates required with respect to the
document or instrument for which it is substituted. Without limiting the generality of the
foregoing, any Senior Notes issued under the authority of such defective document or instrument
shall nevertheless be the valid obligations of the Company entitled to the benefits of this
Indenture equally and ratably with all other Outstanding Senior Notes.

     Section 1.4 Acts of Holders.

     (a) Any request, demand, authorization, direction, notice, consent, waiver or other action
provided by this Indenture to be given to or taken by Holders may be embodied in and evidenced by
one or more instruments of substantially similar tenor signed by such Holders in person or by an
agent thereof duly appointed in writing and, except as herein otherwise expressly provided, such
action shall become effective when such instrument or instruments (including any appointment of an
agent) is or are delivered to the Trustee and, where it is hereby expressly required, to the
Company. Such instrument or instruments (and the action embodied therein and evidenced thereby) are
herein sometimes referred to as the “Act” of the Holders signing such instrument or instruments.
Proof of execution of any such instrument or of a writing appointing any such agent shall be
sufficient for any purpose of this Indenture and conclusive in favor of the Trustee and the
Company, if made in the manner provided in this Section 1.4.

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

     (c) The ownership of Senior Notes shall be proved by the Securities Register.

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

     (e) Without limiting the foregoing, a Holder entitled to take any action hereunder with regard
to any particular Senior Note may do so with regard to all or any part of the principal amount of
such Senior Note or by one or more duly appointed agents each of which may do so pursuant to such
appointment with regard to all or any part of such principal amount.

     (f) Except as set forth in paragraph (g) of this Section 1.4, the Company may set any
day as a record date for the purpose of determining the Holders of Outstanding Senior Notes
entitled to give, make or take any request, demand, authorization, direction, notice, consent,
waiver or other action provided or permitted by this Indenture to be given, made or taken by
Holders of Senior Notes. If any record date is set pursuant to this paragraph, the Holders of
Outstanding Senior Notes on such record date, and no other Holders, shall be entitled to take the
relevant action, whether or not such Holders remain Holders after such record date; provided,
that no such action shall be effective hereunder unless taken on or prior to the applicable
Expiration Date by Holders of the requisite principal amount of Outstanding Senior Notes on such
record date. Nothing in this paragraph shall be construed to prevent the Company from setting a
new record date for any action for which a record date has previously been set pursuant to this
paragraph (whereupon the record date previously set shall automatically and with no action by any
Person be canceled and of no effect). Promptly after any record date is set pursuant to this
paragraph, the Company, at its own expense, shall cause notice of such record date, the proposed
action by Holders and the applicable Expiration Date to be given to the Trustee in writing and to
each Holder of Senior Notes in the manner set forth in Section 1.6.

     (g) The Trustee may set any day as a record date for the purpose of determining the Holders of
Outstanding Senior Notes entitled to join in the giving or making of (i) any Notice of Default,
(ii) any declaration of acceleration or rescission or annulment thereof referred to in Section
5.2, (iii) any request to institute proceedings referred to in Section 5.7(b) or (iv)
any direction referred to in Section 5.12. If any record date is set pursuant to this
paragraph, the Holders of Outstanding Senior Notes on such record date, and no other Holders, shall
be entitled to join in such notice, declaration, request or direction, whether or not such Holders
remain Holders after such record date; provided, that no such action shall be effective
hereunder unless taken on or prior to the applicable Expiration Date by Holders of the requisite
principal amount of Outstanding Senior Notes on such record date. Nothing in this paragraph shall
be construed to prevent the Trustee from setting a new record date for any action for which a
record date has previously been set pursuant to this paragraph (whereupon the record date
previously set shall automatically and with no action by any Person be canceled and of no effect).
Promptly after any record date is set pursuant to this paragraph, the Trustee, at the Company’s
expense, shall cause notice of such record date, the proposed action by Holders and the applicable
Expiration Date to be given to the Company in writing and to each Holder of Senior Notes in the
manner set forth in Section 1.6.

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     (h) With respect to any record date set pursuant to paragraph (f) or (g) of this Section
1.4, the party hereto that sets such record date may designate any day as the “Expiration
Date” and from time to time may change the Expiration Date to any earlier or later day;
provided, that no such change shall be effective unless notice of the proposed new
Expiration Date is given to the other party hereto in writing, and to each Holder of Senior Notes
in the manner set forth in Section 1.6, on or prior to the existing Expiration Date. If an
Expiration Date is not designated with respect to any record date set pursuant to this Section
1.4, the party hereto that set such record date shall be deemed to have initially designated
the ninetieth (90th) day after such record date as the Expiration Date with respect thereto,
subject to its right to change the Expiration Date as provided in this paragraph. Notwithstanding
the foregoing, no Expiration Date shall be later than the one hundred eightieth (180th) day after
the applicable record date.

     Section 1.5 Notices, Etc. to Trustee and Company.

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

     (a) the Trustee by any Holder or the Company shall be sufficient for every purpose hereunder
if made, given, furnished or filed in writing to or with and received by the Trustee at its
Corporate Trust Office; or

     (b) the Company by the Trustee or any Holder shall be sufficient for every purpose hereunder
if in writing and mailed, first class, postage prepaid, to the Company addressed to it at 11465
Sunset Hills Road, Suite 510, Reston, Virginia 20190 or at any other address previously furnished
in writing to the Trustee by the Company.

     Section 1.6 Notice to Holders; Waiver.

     Where this Indenture provides for notice to Holders of any event, such notice shall be
sufficiently given (unless otherwise herein expressly provided) if in writing and mailed, first
class, postage prepaid, to each Holder affected by such event to the address of such Holder as it
appears in the Securities Register, not later than the latest date (if any), and not earlier than
the earliest date (if any), prescribed for the giving of such notice. If, by reason of the
suspension of or irregularities in regular mail service or for any other reason, it shall be
impossible or impracticable to mail notice of any event to Holders when said notice is required to
be given pursuant to any provision of this Indenture, then any manner of giving such notice as
shall be satisfactory to the Trustee shall be deemed to be a sufficient giving of such notice. In
any case where notice to Holders is given by mail, neither the failure to mail such notice, nor any
defect in any notice so mailed, to any particular Holder shall affect the sufficiency of such
notice with respect to other Holders. Where this Indenture provides for notice in any manner, such
notice may be waived in writing by the Person entitled to receive such notice, either before or
after the event, and such waiver shall be the equivalent of such notice. Waivers of notice by
Holders shall be filed with the Trustee, but such filing shall not be a condition precedent to the
validity of any action taken in reliance upon such waiver.

15

 

     Section 1.7 Effect of Headings and Table of Contents.

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

     Section 1.8 Successors and Assigns.

     This Indenture shall be binding upon and shall inure to the benefit of any successor to the
Company and the Trustee, including any successor by operation of law. Except in connection with a
transaction involving the Company that is permitted under Article VIII and pursuant to
which the assignee agrees in writing to perform the Company’s obligations hereunder, the Company
shall not assign its obligations hereunder.

     Section 1.9 Separability.

     If any provision in this Indenture or in the Senior Notes shall be invalid, illegal or
unenforceable, the validity, legality and enforceability of the remaining provisions shall not in
any way be affected or impaired thereby, and there shall be deemed substituted for the provision
at issue a valid, legal and enforceable provision as similar as possible to the provision at
issue.

     Section 1.10 Benefits of Indenture.

     Nothing in this Indenture or in the Senior Notes, express or implied, shall give to any
Person, other than the parties hereto and their successors and assigns, the Holders of the Senior
Notes and, solely to the extent set forth herein, the holders of Permitted Debt, any benefit or any
legal or equitable right, remedy or claim under this Indenture.

     Section 1.11 Governing Law.

     This Indenture and the rights and obligations of each of the Holders, the Company and the
Trustee shall be construed and enforced in accordance with and governed by the laws of the State
of New York without reference to its conflict of laws provisions (other than Section 5-1401 of the
General Obligations Law).

     Section 1.12 Submission to Jurisdiction.

     ANY LEGAL ACTION OR PROCEEDING BY OR AGAINST ANY PARTY HERETO OR WITH RESPECT TO OR ARISING
OUT OF THIS INDENTURE MAY BE BROUGHT IN OR REMOVED TO THE COURTS OF THE STATE OF NEW YORK, IN AND
FOR THE COUNTY OF NEW YORK, OR OF THE UNITED STATES OF AMERICA FOR THE SOUTHERN DISTRICT OF NEW
YORK (IN EACH CASE SITTING IN THE BOROUGH OF MANHATTAN). BY EXECUTION AND DELIVERY OF THIS
INDENTURE, EACH PARTY ACCEPTS, FOR ITSELF AND IN RESPECT OF ITS PROPERTY, GENERALLY AND
UNCONDITIONALLY, THE JURISDICTION OF THE AFORESAID COURTS (AND COURTS OF APPEALS THEREFROM) FOR
LEGAL PROCEEDINGS ARISING OUT OF OR IN CONNECTION WITH THIS INDENTURE.

16

 

     Section 1.13 Non-Business Days.

     If any Interest Payment Date, Redemption Date or Stated Maturity of any Senior Note shall not
be a Business Day, then (notwithstanding any other provision of this Indenture or the Senior
Notes) payment of interest, premium, if any, or principal or other amounts in respect of such
Senior Note shall not be made on such date, but shall be made on the next succeeding Business Day
(and interest shall accrue in respect of the amounts whose payment is so delayed for the period
from and after such Interest Payment Date, Redemption Date or Stated Maturity, as the case may be,
until such next succeeding Business Day) except that, if such Business Day falls in the next
succeeding calendar year, such payment shall be made on the immediately preceding Business Day, in
each case with the same force and effect as if made on the Interest Payment Date or Redemption
Date or at the Stated Maturity.

     Section 1.14 Counterparts.

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

ARTICLE II

SENIOR NOTE FORMS

     Section 2.1 Form of Senior Note.

Any Senior Note issued hereunder shall be in substantially the following form:

COMSTOCK HOMEBUILDING COMPANIES, INC.

Senior Note due 2017

			
	 	 	 
	No.                     
	 	$                     

     Comstock Homebuilding Companies, Inc., a corporation organized and existing under the laws
of Delaware (hereinafter called the “Company,” which term includes any successor Person under the
Indenture hereinafter referred to), for value received, hereby promises to pay to
[                      ], or registered assigns, the principal sum of [PRINCIPAL AMOUNT]
($[                      ]) [IF THE SECURITY IS A GLOBAL SECURITY, THEN INSERT: or
such other principal amount represented hereby as may be set forth in the records of the
Securities Registrar hereinafter referred to in accordance with the Indenture] on March 30, 2017.
The Company further promises to pay interest on said principal sum from and including March 15,
2007, or from and including the most recent Interest Payment Date to which interest has been paid
or duly provided for, quarterly in arrears, to but excluding the succeeding Interest Payment
Date, on March 30, June 30, September 30 and December 30 of each year, commencing March 30, 2007,
or if any such day is not a Business Day, on the next succeeding Business Day (and interest shall
accrue in respect of the amounts whose payment is so delayed for the period from and after such
Interest Payment Date until such next succeeding Business Day), except that,

17

 

if such Business Day falls in the next succeeding calendar year, such payment shall be made on the
immediately preceding Business Day, in each case, with the same force and effect as if made on the
Interest Payment Date, at a fixed rate equal to 9.72% per annum through the Interest Payment Date
in June 2011 (“Fixed Rate Period”) and thereafter at a variable rate, reset quarterly, equal to
LIBOR plus 4.20% per annum, until the principal hereof is paid or duly provided for or made
available for payment; provided, that any overdue principal, premium, if any, and any
overdue installment of interest shall bear Additional Interest at a fixed rate equal to 9.72% per
annum through the interest payment date in June 2011 and thereafter at a variable rate, reset
quarterly, equal to LIBOR plus 4.20% per annum (to the extent that the payment of such interest
shall be legally enforceable), compounded quarterly, from and including the dates such amounts are
due to but excluding the dates such amounts are paid or made available for payment, and such
interest shall be payable on demand.

     During the Fixed Rate Period, the amount of interest payable for any interest period shall be
computed on the basis of a three hundred sixty (360)-day year of twelve (12) thirty (30)-day
months and the amount payable for any partial period shall be computed on the basis of the actual
number of days elapsed in a three hundred sixty (360)-day year of twelve (12) thirty (30)-day
months. Upon expiration of the Fixed Rate Period, the amount of interest payable for any interest
period will be computed on the basis of a three hundred sixty (360)-day year and the actual number
of days elapsed in the relevant interest period. The interest so payable, and punctually paid or
duly provided for, on any Interest Payment Date shall, as provided in the Indenture, be paid to
the Person in whose name this Senior Note (or one or more Predecessor Senior Notes) is registered
at the close of business on the Regular Record Date for such interest installment. Any such
interest not so punctually paid or duly provided for shall forthwith cease to be payable to the
Holder on such Regular Record Date and may either be paid to the Person in whose name this Senior
Note (or one or more Predecessor Senior Notes) is registered at the close of business on a Special
Record Date for the payment of such Defaulted Interest to be fixed by the Trustee, notice whereof
shall be given to Holders of Senior Notes not less than ten (10) days prior to such Special Record
Date, or be paid at any time in any other lawful manner not inconsistent with the requirements of
any securities exchange or automated quotation system on which the Senior Notes may be listed,
traded or quoted and upon such notice as may be required by such exchange or automated quotation
system, all as more fully provided in the Indenture.

     During an Event of Default, the Company shall not (i) declare or pay any dividends or
distributions on, or redeem, purchase, acquire or make a liquidation payment with respect to, any
Equity Interests of the Company, (ii) vote in favor of or permit or otherwise allow any of its
Subsidiaries to declare or pay any dividends or distributions on, or redeem, purchase, acquire or
make a liquidation payment with respect to or otherwise retire, any preferred Equity Interests of
such Subsidiaries or other Equity Interests entitling the holders thereof to a stated rate of
return (for the avoidance of doubt, whether such preferred Equity Interests are perpetual or
otherwise) or (iii) make any payment of principal of or any interest or premium, if any, on or
repay, repurchase or redeem any Debt of the Company other than Permitted Debt (other than (A)
repurchases, redemptions or other acquisitions of Equity Interests of the Company in connection
with (1) any employment contract, benefit plan or other similar arrangement with or for the benefit
of any one or more employees, officers, directors or consultants, (2) a dividend reinvestment or
Equity Interests purchase plan or (3) the issuance of Equity Interests in the Company (or
securities convertible into or exercisable for such Equity Interests) as consideration

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in an acquisition transaction entered into prior to the applicable Event of Default, (B) as a
result of an exchange, conversion reclassification or combination of any class or series of the
Company’s Equity Interests (or any Equity Interests in a Subsidiary of the Company) for, of or with
any class or series of the Company’s Equity Interests or of any class or series of the Company’s
indebtedness for any class or series of the Company’s Equity Interests, (C) the purchase of
fractional interests in the Equity Interests of the Company pursuant to the conversion or exchange
provisions of such Equity Interests or the security being converted or exchanged, (D) any
declaration of a dividend in connection with any Rights Plan, the issuance of rights, Equity
Interests or other property under any Rights Plan or the redemption or repurchase of rights
pursuant thereto or (E) any dividend in the form of Equity Interests, warrants, options or other
rights where the dividend Equity Interest or the Equity Interest issuable upon exercise of such
warrants, options or other rights is the same Equity Interest as that on which the dividend is
being paid or ranks pari passu with or junior to such Equity Interest).

     Payment of principal of, premium, if any, and interest on this Senior Note shall be made 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. Payments of principal, premium, if any, and interest due at
the Maturity of this Senior Note shall be made at the Place of Payment upon surrender of such
Senior Notes to the Paying Agent, and payments of interest shall be made, subject to such surrender
where applicable, by wire transfer at such place and to such account at a banking institution in
the United States as may be designated in writing to the Paying Agent at least ten (10) Business
Days prior to the date for payment by the Person entitled thereto unless proper written transfer
instructions have not been received by the relevant record date, in which case such payments shall
be made by check mailed to the address of such Person as such address shall appear in the Security
Register.

     The indebtedness evidenced by this Senior Note is, to the extent provided in the Indenture,
subordinate and junior in right of payment to the prior payment in full of all Permitted Debt, and
this Senior Note is issued subject to the provisions of the Indenture with respect thereto. Each
Holder of this Senior Note, by accepting the same, (a) agrees to and shall be bound by such
provisions, (b) authorizes and directs the Trustee on his, her or its behalf to take such actions
as may be necessary or appropriate to effectuate the subordination so provided and (c) appoints
the Trustee his, her or its attorney-in-fact for any and all such purposes. Each Holder hereof, by
his, her or its acceptance hereof, waives all notice of the acceptance of the subordination
provisions contained herein and in the Indenture by each holder of Permitted Debt, whether now
outstanding or hereafter incurred, and waives reliance by each such holder upon said provisions.

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

[FORM OF REVERSE OF SECURITY]

     This Senior Note is one of a duly authorized issue of securities of the Company (the “Senior Notes”) issued under the Indenture, dated as of March 15, 2007 (the “Indenture”), between the
Company and Wells Fargo Bank, N.A., as Trustee (in such capacity, the “Trustee,”

19

 

which term includes any successor trustee under the Indenture), to which Indenture and all
indentures supplemental thereto reference is hereby made for a statement of the respective rights,
limitations of rights, duties and immunities thereunder of the Company, the Trustee and the
Holders of the Senior Notes, and of the terms upon which the Senior Notes are, and are to be,
authenticated and delivered. All terms used in this Senior Note that are defined in the Indenture
shall have the meanings assigned to them in the Indenture.

     The Company may, on any Interest Payment Date, at its option, upon not less than thirty (30)
days’ nor more than sixty (60) days’ written notice to the Holders of the Senior Notes (unless a
shorter notice period shall be satisfactory to the Trustee) (i) on or after June 30, 2011, (ii)
upon receipt of thirty (30) days prior written notice from the Purchaser of Purchaser’s intent to
consummate a sale, assignment or transfer of this Senior Note to a subsequent purchaser (including
to any entity issuing or proposing to issue collateralized debt obligations) other than an
Affiliate of the Purchaser, or (iii) to the extent the Purchaser has not consummated one of the
transactions in subsection (ii) hereof and subject to the terms and conditions of Article XI of
the Indenture, redeem this Senior Note in whole at any time or, subject to the consent of the
Purchaser (or any Affiliate transferee thereof), in part from time to time in each case at a
Redemption Price equal to one hundred percent (100%) of the principal amount hereof (or of the
redeemed portion hereof, as applicable), together, in the case of any such redemption, with
accrued and unpaid interest, including any Additional Interest, to but excluding the date fixed as
the Redemption Date and plus all Breakage Costs. Notwithstanding the foregoing, in the event of a
redemption of this Senior Note by the Company pursuant to (ii) of this paragraph above, the
Company shall (y) provide not less than five (5) days’ nor more than ten (10) days’ written notice
to the Holders of the Senior Notes and (z) the redemption will not be required to occur on an
Interest Payment Date.

     In addition, prior to June 30, 2011, upon the occurrence and during the continuation of a
Special Event, the Company may, at its option, upon not less than thirty (30) days’ nor more than
sixty (60) days’ written notice to the Holders of the Senior Notes (unless a shorter notice period
shall be satisfactory to the Trustee), redeem this Senior Note, in whole but not in part and
subject to the terms and conditions of Article XI of the Indenture, at a Redemption Price equal to
one hundred seven and one-half percent (107.5%) of the principal amount hereof, together, in the
case of any such redemption, with accrued interest, including any Additional Interest, to but
excluding the date fixed as the Redemption Date.

     Further, the Company shall, upon receipt of a Change-of-Control Election after June 30, 2011,
redeem the Senior Notes in whole on a date no more than thirty (30) days after receipt of the
Change-of-Control Election, at a Redemption Price equal to one hundred percent (100%) of the
principal amount thereof, together, in the case of any such redemption, with accrued and unpaid
interest, including any Additional Interest, to but excluding the date fixed as the Redemption
Date. The Company shall in connection with the receipt of a Put Election Notice, redeem the portion
of the Senior Notes elected to be caused to be redeemed pursuant to such Put Election Notice on a
date no more than thirty (30) days after receipt of the Put Election Notice, at a Redemption Price
equal to one hundred percent (100%) of the principal amount thereof, together, in the case of any
such redemption, with accrued and unpaid interest, including any Additional Interest, to but
excluding the date fixed as the Redemption Date, and plus all Breakage Costs. The Company shall in
connection with an Acceptable Repurchase, redeem a

20

 

portion of the Senior Notes at a Redemption Price equal to one hundred percent (100%) of the
principal amount thereof, together, in the case of any such redemption, with accrued and unpaid
interest, including any Additional Interest, to but excluding the date fixed as the Redemption
Date, and plus all Breakage Costs.

     In the event of redemption of this Senior Note in part only, a new Senior Note or Senior
Notes for the unredeemed portion hereof will be issued in the name of the Holder hereof upon the
cancellation hereof. If less than all the Senior Notes are to be redeemed, the particular Senior
Notes to be redeemed shall be selected not more than sixty (60) days prior to the Redemption Date
by the Trustee from the Outstanding Senior Notes not previously called for redemption, by such
method as the Trustee shall deem fair and appropriate and which may provide for the selection for
redemption of a portion of the principal amount of any Senior Note.

     The Indenture permits, with certain exceptions as therein provided, the Company and the
Trustee at any time to enter into a supplemental indenture or indentures for the purpose of
modifying in any manner the rights and obligations of the Company and of the Holders of the Senior
Notes, with the consent of the Holders of not less than a majority in principal amount of the
Outstanding Senior Notes. The Indenture also contains provisions permitting Holders of specified
percentages in principal amount of the Senior Notes, on behalf of the Holders of all Senior Notes,
to waive compliance by the Company with certain provisions of the Indenture and certain past
defaults under the Indenture and their consequences. Any such consent or waiver by the Holder of
this Senior Note shall be conclusive and binding upon such Holder and upon all future Holders of
this Senior Note and of any Senior Note issued upon the registration of transfer hereof or in
exchange herefor or in lieu hereof, whether or not notation of such consent or waiver is made upon
this Senior Note.

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

     As provided in the Indenture and subject to certain limitations therein set forth, the
transfer of this Senior Note is restricted to transfers to “Qualified Purchasers” (as such term is
defined in the Investment Company Act of 1940, as amended) and is registrable in the Senior Notes
Register, upon surrender of this Senior Note for registration of transfer at the office or agency
of the Company maintained for such purpose, duly endorsed by, or accompanied by a written
instrument of transfer in form satisfactory to the Company and the Securities Registrar and duly
executed by, the Holder hereof or such Holder’s attorney duly authorized in writing, and thereupon
one or more new Senior Notes, of like tenor, of authorized denominations and for the same
aggregate principal amount, will be issued to the designated transferee or transferees.

     The Senior Notes are issuable only in registered form without coupons in minimum
denominations of $100,000 and any integral multiple of $1,000 in excess thereof. As provided in
the Indenture and subject to certain limitations therein set forth, Senior Notes are exchangeable
for a like aggregate principal amount of Senior Notes and of like tenor of a different authorized
denomination, as requested by the Holder surrendering the same.

21

 

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

     The Company, the Trustee and any agent of the Company or the Trustee may treat the Person in
whose name this Senior Note is registered as the owner hereof for all purposes, whether or not
this Senior Note be overdue, and neither the Company, the Trustee nor any such agent shall be
affected by notice to the contrary.

     The Company and, by its acceptance of this Senior Note or a beneficial interest herein, the
Holder of, and any Person that acquires a beneficial interest in, this Senior Note agree that, for
United States federal, state and local tax purposes, it is intended that this Senior Note
constitute indebtedness.

     This Senior Note shall be construed and enforced in accordance with and governed by the laws
of the State of New York without reference to its conflict of laws provisions (other than Section
5-1401 of the General Obligations Law).

     IN WITNESS WHEREOF, the Company has caused this instrument to be duly executed on this [DAY]
day of [MONTH], [YEAR].

	 	 	 	 	 	 	 
	 	 	COMSTOCK HOMEBUILDING COMPANIES, INC.
	 
	 	 	 	 	 	 
	 

	 	By:	 	 	 	 
	 

	 	 	 	 	 	 
	 

	 	Name:	 	 	 	 
	 

	 	 	 	 	 	 
	 

	 	Title:	 	 	 	 
	 

	 	 	 	 	 	 

     Section 2.2 Restrictive Legend.

     (a) Any Senior Note issued hereunder shall bear a legend in substantially the following form:

IF THIS SECURITY IS A GLOBAL SECURITY INSERT: “THIS SECURITY IS A GLOBAL SECURITY
WITHIN THE MEANING OF THE INDENTURE HEREINAFTER REFERRED TO AND IS REGISTERED IN THE NAME
OF THE DEPOSITORY TRUST COMPANY (“DTC”) OR A NOMINEE OF DTC. THIS SECURITY IS EXCHANGEABLE
FOR SECURITIES REGISTERED IN THE NAME OF A PERSON OTHER THAN DTC OR ITS NOMINEE ONLY IN THE
LIMITED CIRCUMSTANCES DESCRIBED IN THE INDENTURE, AND NO TRANSFER OF THIS SECURITY (OTHER
THAN A TRANSFER OF THIS SECURITY AS A WHOLE BY DTC TO A NOMINEE OF DTC OR BY A

22

 

NOMINEE OF DTC TO DTC OR ANOTHER NOMINEE OF DTC) MAY BE REGISTERED EXCEPT IN LIMITED
CIRCUMSTANCES.

UNLESS THIS SECURITY IS PRESENTED BY AN AUTHORIZED REPRESENTATIVE OF DTC TO THE ISSUER OR ITS
AGENT FOR REGISTRATION OF TRANSFER, EXCHANGE OR PAYMENT, AND ANY SECURITY ISSUED IS REGISTERED IN
THE NAME OF CEDE & CO. OR IN SUCH OTHER NAME AS REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF DTC
(AND ANY PAYMENT HEREON IS MADE TO CEDE & CO. OR TO SUCH OTHER ENTITY AS IS REQUESTED BY AN
AUTHORIZED REPRESENTATIVE OF DTC), ANY TRANSFER, PLEDGE OR OTHER USE HEREOF FOR VALUE OR OTHERWISE
BY OR TO ANY PERSON IS WRONGFUL INASMUCH AS THE REGISTERED OWNER HEREOF, CEDE & CO., HAS AN
INTEREST HEREIN.]

THE SECURITIES REPRESENTED BY THIS CERTIFICATE WERE ORIGINALLY ISSUED IN A TRANSACTION EXEMPT
FROM REGISTRATION UNDER THE SECURITIES ACT OF 1933, AS AMENDED (THE “SECURITIES ACT”) AND SUCH
SECURITIES, AND ANY INTEREST THEREIN, MAY NOT BE OFFERED, SOLD OR OTHERWISE TRANSFERRED IN THE
ABSENCE OF SUCH REGISTRATION OR AN APPLICABLE EXEMPTION THEREFROM. EACH PURCHASER OF ANY SECURITIES
IS HEREBY NOTIFIED THAT THE SELLER OF THE SECURITIES MAY BE RELYING ON THE EXEMPTION FROM THE
PROVISIONS OF SECTION 5 OF THE SECURITIES ACT PROVIDED BY RULE 144A UNDER THE SECURITIES ACT.

THE HOLDER OF THE SECURITIES REPRESENTED BY THIS CERTIFICATE AGREES FOR THE BENEFIT OF THE COMPANY
THAT (A) SUCH SECURITIES MAY BE OFFERED, RESOLD OR OTHERWISE TRANSFERRED ONLY (I) TO THE COMPANY,
(II) TO A PERSON WHOM THE SELLER REASONABLY BELIEVES IS (a) A “QUALIFIED INSTITUTIONAL BUYER” (AS
DEFINED IN RULE 144A UNDER THE SECURITIES ACT) AND (b) A “QUALIFIED PURCHASER” (AS DEFINED IN
SECTION 2(a)(51) OF THE INVESTMENT COMPANY ACT OF 1940, AS AMENDED) OR (III) TO A PERSON WHOM THE
SELLER REASONABLY BELIEVES IS A “QUALIFIED PURCHASER “ (AS DEFINED IN SECTION 2(a)(51) OF THE
INVESTMENT COMPANY ACT OF 1940, AS AMENDED) AND (B) THE HOLDER WILL NOTIFY ANY PURCHASER OF ANY
SECURITIES FROM IT OF THE RESALE RESTRICTIONS REFERRED TO IN (A) ABOVE.

THE SECURITIES WILL BE ISSUED AND MAY BE TRANSFERRED ONLY IN BLOCKS HAVING AN AGGREGATE PRINCIPAL
AMOUNT OF NOT LESS THAN $100,000. TO THE FULLEST EXTENT PERMITTED BY LAW, ANY ATTEMPTED TRANSFER
OF SECURITIES, OR ANY INTEREST THEREIN, IN A BLOCK HAVING AN AGGREGATE PRINCIPAL AMOUNT OF LESS
THAN $100,000 AND MULTIPLES OF $1,000 IN EXCESS THEREOF SHALL BE DEEMED TO BE VOID AND OF NO LEGAL
EFFECT WHATSOEVER. TO THE FULLEST EXTENT

23

 

PERMITTED BY LAW, ANY SUCH PURPORTED TRANSFEREE SHALL BE DEEMED NOT TO BE THE HOLDER OF
SUCH SECURITIES FOR ANY PURPOSE, INCLUDING, BUT NOT LIMITED TO, THE RECEIPT OF PRINCIPAL OF
OR INTEREST ON SUCH SECURITIES, OR ANY INTEREST THEREIN, AND SUCH PURPORTED TRANSFEREE
SHALL BE DEEMED TO HAVE NO INTEREST WHATSOEVER IN SUCH SECURITIES.

THE HOLDER OF THIS SECURITY, OR ANY INTEREST THEREIN, BY ITS ACCEPTANCE HEREOF OR THEREOF
ALSO AGREES, REPRESENTS AND WARRANTS THAT IT IS NOT AN EMPLOYEE BENEFIT PLAN, INDIVIDUAL
RETIREMENT ACCOUNT OR OTHER PLAN OR ARRANGEMENT SUBJECT TO TITLE I OF THE EMPLOYEE
RETIREMENT INCOME SECURITY ACT OF 1974, AS AMENDED (“ERISA”), OR SECTION 4975 OF THE
INTERNAL REVENUE CODE OF 1986, AS AMENDED (THE “CODE”), OR SIMILAR LAW (EACH A “PLAN”), OR
AN ENTITY WHOSE UNDERLYING ASSETS INCLUDE “PLAN ASSETS” BY REASON OF ANY PLAN’S INVESTMENT
IN THE ENTITY, AND NO PERSON INVESTING “PLAN ASSETS” OF ANY PLAN MAY ACQUIRE OR HOLD THIS
SECURITY OR ANY INTEREST THEREIN. ANY PURCHASER OR HOLDER OF THE SECURITIES OR ANY INTEREST
THEREIN WILL BE DEEMED TO HAVE REPRESENTED BY ITS PURCHASE AND HOLDING THEREOF THAT IT IS
NOT AN EMPLOYEE BENEFIT PLAN WITHIN THE MEANING OF SECTION 3(3) OF ERISA, OR A PLAN TO
WHICH SECTION 4975 OF THE CODE IS APPLICABLE, A TRUSTEE OR OTHER PERSON ACTING ON BEHALF OF
AN EMPLOYEE BENEFIT PLAN OR PLAN, OR ANY OTHER PERSON OR ENTITY USING THE ASSETS OF ANY
EMPLOYEE BENEFIT PLAN OR PLAN TO FINANCE SUCH PURCHASE.”

     (b) The above legends shall not be removed from any Senior Note unless there is delivered to
the Company satisfactory evidence, which may include an Opinion of Counsel, as may be reasonably
required to ensure that any future transfers thereof may be made without restriction under or
violation of the provisions of the Securities Act and other applicable law. Upon provision of such
satisfactory evidence, the Company shall execute and deliver to the Trustee, and the Trustee shall
deliver, upon receipt of a Company Order directing it to do so, a Senior Note that does not bear
the legend.

     Section 2.3 Form of Trustee’s Certificate of Authentication.

     The Trustee’s certificate of authentication shall be in substantially the following form:

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

	 	 	 	 	 	 	 
	Dated: 	 	WELLS FARGO BANK, N.A., not in its individual
capacity, but solely as Trustee	 	 
	 
	 	 	 	 	 	 
	 

	 	By:	 	 	 	 
	 

	 	 	 	 	 	 
	 

	 	 	 	Name:	 	 
	 

	 	 	 	Title:	 	 

     Section 2.4 Temporary Senior Notes.

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

     (b) If temporary Senior Notes are issued, the Company will cause definitive Senior Notes to be
prepared without unreasonable delay. After the preparation of definitive Senior Notes, the
temporary Senior Notes shall be exchangeable for definitive Senior Notes upon surrender of the
temporary Senior Notes at the office or agency of the Company designated for that purpose without
charge to the Holder. Upon surrender for cancellation of any one or more temporary Senior Notes,
the Company shall execute and the Trustee shall authenticate and deliver in exchange therefor
one or more definitive Senior Notes of any authorized denominations having the same
Original Issue Date and Stated Maturity and having the same terms as such temporary Senior Notes.
Until so exchanged, the temporary Senior Notes shall in all respects be entitled to the same
benefits under this Indenture as definitive Senior Notes.

     Section 2.5 Definitive Senior Notes.

     The definitive Senior Notes shall be printed, lithographed or engraved, or produced by any
combination of these methods, if required by any securities exchange on which the Senior Notes may
be listed, on a steel engraved border or steel engraved borders or may be produced in any other
manner permitted by the rules of any securities exchange on which the Senior Notes may be listed,
all as determined by the officers executing such Senior Notes, as evidenced by their execution of
such Senior Notes.

25

 

ARTICLE III

THE SENIOR NOTES

     
Section 3.1 Payment of Principal and Interest.

     (a) The unpaid principal amount of the Senior Notes shall bear interest at a fixed rate equal
to 9.72% per annum through the Interest Payment Date in June 2011 and thereafter at a variable rate
equal to LIBOR plus 4.20% per annum until paid or duly provided for, such interest to accrue from
and including the Original Issue Date or from and including the most recent Interest Payment Date
to which interest has been paid or duly provided for to but excluding the succeeding Interest
Payment Date, and any overdue principal, premium, if any, and any overdue installment of interest
shall bear Additional Interest at the rate equal to a fixed rate equal to 9.72% per annum through
the Interest Payment Date in June 2011 and thereafter at a variable rate, reset quarterly, equal to
LIBOR plus 4.20% per annum (to the extent that the payment of such interest shall be legally
enforceable), compounded quarterly from and including the dates such amounts are due to but
excluding the dates such amounts are paid or funds for the payment thereof are made available for
payment.

     (b) Interest and Additional Interest on any Senior Note that is payable, and is punctually
paid or duly provided for, on any Interest Payment Date shall be paid to the Person in whose name
that Senior Note (or one or more Predecessor Senior Notes) is registered at the close of business
on the Regular Record Date for such interest, except that interest and any Additional Interest
payable on the Stated Maturity (or any date of principal repayment upon early maturity) of the
principal of a Senior Note or on a Redemption Date shall be paid to the Person to whom principal is
paid. The initial payment of interest on any Senior Note that is issued between a Regular Record
Date and the related Interest Payment Date shall be payable as provided in such Senior Note.

     (c) Any interest on any Senior Note that is due and payable, but is not timely paid or duly
provided for, on any Interest Payment Date for Senior Notes (herein called “Defaulted
Interest”) shall forthwith cease to be payable to the registered Holder on the relevant Regular
Record Date by virtue of having been such Holder, and such Defaulted Interest may be paid by the
Company, at its election in each case, as provided in paragraph (i) or (ii) below:

     (i) The Company may elect to make payment of any Defaulted Interest to the Persons in
whose names the Senior Notes (or their respective Predecessor Senior Notes) are registered
at the close of business on a Special Record Date for the payment of such Defaulted
Interest (a “Special Record Date”), which shall be fixed in the following manner. At least
thirty (30) days prior to the date of the proposed payment, the Company shall notify the
Trustee in writing of the amount of Defaulted Interest proposed to be paid on each Senior
Note and the date of the proposed payment, and at the same time the Company shall deposit
with the Trustee an amount of money equal to the aggregate amount proposed to be paid in
respect of such Defaulted Interest or shall make arrangements satisfactory to the Trustee
for such deposit prior to the date of the proposed payment, such money when deposited to
be held in trust for the benefit of the Persons entitled to such Defaulted Interest.
Thereupon the Trustee shall fix a Special Record Date

26

 

for the payment of such Defaulted Interest, which shall be not more than fifteen (15)
days and not less than ten (10) days prior to the date of the proposed payment and not less
than ten (10) days after the receipt by the Trustee of the notice of the proposed payment.
The Trustee shall promptly notify the Company of such Special Record Date and, in the name
and at the expense of the Company, shall cause notice of the proposed payment of such
Defaulted Interest and the Special Record Date therefor to be mailed, first class, postage
prepaid, to each Holder of a Senior Note at the address of such Holder as it appears in the
Securities Register not less than ten (10) days prior to such Special Record Date. Notice
of the proposed payment of such Defaulted Interest and the Special Record Date therefor
having been so mailed, such Defaulted Interest shall be paid to the Persons in whose names
the Senior Notes (or their respective Predecessor Senior Notes) are registered on such
Special Record Date; or

     (ii) The Company may make payment of any Defaulted Interest in any other lawful manner
not inconsistent with the requirements of any securities exchange or automated quotation
system on which the Senior Notes may be listed, traded or quoted and, upon such notice as
may be required by such exchange or automated quotation system (or by the Trustee if the
Senior Notes are not listed), if, after notice given by the Company to the Trustee of the
proposed payment pursuant to this clause, such payment shall be deemed practicable by the
Trustee.

     (d) Payments of interest on the Senior Notes shall include interest accrued to but excluding
the respective Interest Payment Dates. During the Fixed Rate Period, the amount of interest
payable for any interest period shall be computed on the basis of a three hundred sixty (360)-day
year of twelve (12) thirty (30)-day months and the amount payable for any partial period shall be
computed on the basis of the actual number of days elapsed in a three hundred sixty (360)-day year
of twelve (12) thirty (30)-day months. Upon expiration of the Fixed Rate Period, the amount of
interest payable for any interest period will be computed on the basis of a three hundred sixty
(360)-day year and the actual number of days elapsed in the relevant interest period.

     (e) Payment of principal of, premium, if any, and interest on the Senior Notes shall be made
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. Payments of principal, premium, if any, and interest due
at the Maturity of such Senior Notes shall be made at the Place of Payment upon surrender of such
Senior Notes to the Paying Agent and payments of interest shall be made, subject to such surrender
where applicable, by wire transfer at such place and to such account at a banking institution in
the United States as may be designated in writing to the Paying Agent at least ten (10) Business
Days prior to the date for payment by the Person entitled thereto unless proper written transfer
instructions have not been received by the relevant record date, in which case such payments shall
be made by check mailed to the address of such Person as such address shall appear in the Security
Register.

     (f) The parties hereto acknowledge and agree that the Holders have certain rights to direct
the Company to modify the Interest Payment Dates and corresponding Redemption Date and Stated
Maturity of the Senior Notes or a portion of the Senior Notes pursuant to the Purchase Agreement.
In the event any such modifications are made to the Senior Notes or a portion of the

27

 

Senior Notes, appropriate changes to the form of Senior Note set forth in Article II
hereof shall be made prior to the issuance and authentication of new or replacement Senior Notes.
Any such modification of the Interest Payment Dates and corresponding Redemption Date and Stated
Maturity with respect to any Senior Notes or tranche of Senior Notes shall not require or be
subject to the consent of the Trustee.

     (g) Subject to the foregoing provisions of this Section 3.1, each Senior Note
delivered under this Indenture upon transfer of or in exchange for or in lieu of any other Senior
Note shall carry the rights to interest accrued and unpaid, and to accrue, that were carried by
such other Senior Note.

     (h) The
Senior Notes will rank pari passu with each other and the Company’s other senior
unsecured obligations, other than such senior unsecured obligations constituting Permitted Debt to
the extent set forth in Article XII, from time to time outstanding.

     Section 3.2 Denominations.

     The Senior Notes shall be in registered form without coupons and shall be issuable in minimum
denominations of $100,000 and any integral multiple of $1,000 in excess thereof.

     Section 3.3
Execution, Authentication, Delivery and Dating.

     (a) At any time and from time to time after the execution and delivery of this Indenture, the
Company may deliver Senior Notes in an aggregate principal amount (including all then Outstanding
Senior Notes) not in excess of Thirty Million Dollars ($30,000,000) executed by the Company to the
Trustee for authentication, together with a Company Order for the authentication and delivery of
such Senior Notes, and the Trustee in accordance with the Company Order shall authenticate and
deliver such Senior Notes. In authenticating such Senior Notes, and accepting the additional
responsibilities under this Indenture in relation to such Senior Notes, the Trustee shall be
entitled to receive, and shall be fully protected in relying upon:

     (i) a copy of any Board Resolution relating thereto; and

     (ii) an Opinion of Counsel stating that: (1) such Senior Notes, when authenticated and
delivered by the Trustee and issued by the Company in the manner and subject to any
conditions specified in such Opinion of Counsel, will constitute, and the Indenture
constitutes, valid and legally binding obligations of the Company, each enforceable in
accordance with its terms, subject to bankruptcy, insolvency, fraudulent transfer,
reorganization, moratorium and similar laws of general applicability relating to or
affecting creditors’ rights and to general equity principles; (2) the Senior Notes have
been duly authorized and executed by the Company and have been delivered to the Trustee for
authentication in accordance with this Indenture; (3) the Senior Notes are not required to
be registered under the Securities Act; and (4) the Indenture is not required to be
qualified under the Trust Indenture Act.

     (b) The Senior Notes shall be executed on behalf of the Company by its Chairman of the Board,
its Vice Chairman of the Board, its Chief Executive Officer, its President or one of its Vice
Presidents. The signature of any of these officers on the Senior Notes may be manual or

28

 

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

     (c) No Senior Note shall be entitled to any benefit under this Indenture or be valid or
obligatory for any purpose, unless there appears on such Senior Note a certificate of
authentication substantially in the form provided for herein executed by the Trustee by the
manual signature of one of its authorized signatories, and such certificate upon any Senior Note
shall be conclusive evidence, and the only evidence, that such Senior Note has been duly
authenticated and delivered hereunder. Notwithstanding the foregoing, if any Senior Note shall
have been authenticated and delivered hereunder but never issued and sold by the Company, and the
Company shall have delivered such Senior Note to the Trustee for cancellation as provided in
Section 3.8, for all purposes of this Indenture such Senior Note shall be deemed never to
have been authenticated and delivered hereunder and shall never be entitled to the benefits of this
Indenture.

     (d) Each Senior Note shall be dated the date of its authentication.

     Section 3.4 Global Senior Notes.

     (a) The Senior Notes issued on the Original Issue Date shall be in the form of Global Senior
Notes. Upon the election of any Holder holding a definitive Senior Note after the Original Issue
Date, which election need not be in writing, the Senior Notes owned by such Holder shall be issued
in the form of one or more Global Senior Notes registered in the name of the Depositary or its
nominee. Each Global Senior Note issued under this Indenture shall be registered in the name of
the Depositary designated by the Company for such Global Senior Note or a nominee thereof and
delivered to such Depositary or a nominee thereof or custodian therefor (which may be the Trustee),
and each such Global Senior Note shall constitute a single Senior Note for all purposes of this
Indenture.

     (b) Notwithstanding any other provision in this Indenture, no Global Senior Note may be
exchanged in whole or in part for registered Senior Notes, and no transfer of a Global Senior Note
in whole or in part may be registered, in the name of any Person other than the Depositary for such
Global Senior Note or a nominee thereof unless (i) such Depositary advises the Trustee and the
Company in writing that such Depositary is no longer willing or able to properly discharge its
responsibilities as Depositary with respect to such Global Senior Note, and no qualified successor
is appointed by the Company within ninety (90) days of receipt by the Company of such notice, (ii)
such Depositary ceases to be a clearing agency registered under the Exchange Act and no successor
is appointed by the Company within ninety (90) days after obtaining knowledge of such event, (iii)
the Company executes and delivers to the Trustee a Company Order stating that the Company elects to
terminate the book-entry system through the Depositary or (iv) an Event of Default shall have
occurred and be continuing. Upon the occurrence of any event specified in clause (i), (ii), (iii)
or (iv) above in this Section 3.4(b), the Trustee shall notify the Depositary and instruct
the Depositary to notify all owners of beneficial interests in such Global Senior Note of the
occurrence of such event and of the availability of Senior Notes to such owners of beneficial
interests requesting the same. The Trustee may

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conclusively rely, and be protected in relying, upon the written identification of the owners of
beneficial interests furnished by the Depositary, and shall not be liable for any delay resulting
from a delay by the Depositary. Upon the issuance of such Senior Notes and the registration in the
Securities Register of such Senior Notes in the names of the Holders of the beneficial interests
therein, the Trustees shall recognize such holders of beneficial interests as Holders.

     (c) If any Global Senior Note is to be exchanged for other Senior Notes or canceled in part,
or if another Senior Note is to be exchanged in whole or in part for a beneficial interest in any
Global Senior Note, then either (i) such Global Senior Note shall be so surrendered for exchange or
cancellation as provided in this Article III or (ii) the principal amount thereof shall be
reduced or increased by an amount equal to (x) the portion thereof to be so exchanged or canceled
or (y) the principal amount of such other Senior Note to be so exchanged for a beneficial interest
therein, as the case may be, by means of an appropriate adjustment made on the records of the
Securities Registrar, whereupon the Trustee, in accordance with the Applicable Depositary
Procedures, shall instruct the Depositary or its authorized representative to make a corresponding
adjustment to its records. Upon any such surrender or adjustment of a Global Senior Note by the
Depositary, accompanied by registration instructions, the Company shall execute and the Trustee
shall authenticate and deliver any Senior Notes issuable in exchange for such Global Senior Note
(or any portion thereof) in accordance with the instructions of the Depositary. The Trustee shall
not be liable for any delay in delivery of such instructions and may conclusively rely on, and
shall be fully protected in relying on, such instructions.

     (d) Every Senior Note executed, authenticated and delivered upon registration of transfer of,
or in exchange for or in lieu of, a Global Senior Note or any portion thereof shall be executed,
authenticated and delivered in the form of, and shall be, a Global Senior Note, unless such Senior
Note is registered in the name of a Person other than the Depositary for such Global Senior Note or
a nominee thereof.

     (e) The Depositary or its nominee, as the registered owner of a Global Senior Note, shall be
the Holder of such Global Senior Note for all purposes under this Indenture and the Senior Notes,
and owners of beneficial interests in a Global Senior Note shall hold such interests pursuant to
the Applicable Depositary Procedures. Accordingly, any such owner’s beneficial interest in a
Global Senior Note shall be shown only on, and the transfer of such interest shall be effected only
through, records maintained by the Depositary or its nominee or its Depositary Participants. The
Securities Registrar and the Trustee shall be entitled to deal with the Depositary for all purposes
of this Indenture relating to a Global Senior Note (including the payment of principal and interest
thereon and the giving of instructions or directions by owners of beneficial interests therein and
the giving of notices) as the sole Holder of the Senior Note and shall have no obligations to the
owners of beneficial interests therein. Neither the Trustee nor the Securities Registrar shall
have any liability in respect of any transfers effected by the Depositary.

     (f) The rights of owners of beneficial interests in a Global Senior Note shall be exercised
only through the Depositary and shall be limited to those established by law and agreements between
such owners and the Depositary and/or its Depositary Participants.

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     (g) No holder of any beneficial interest in any Global Senior Note held on its behalf by a
Depositary shall have any rights under this Indenture with respect to such Global Senior Note, and
such Depositary may be treated by the Company, the Trustee and any agent of the Company or the
Trustee as the owner of such Global Senior Note for all purposes whatsoever. None of the Company,
the Trustee nor any agent of the Company or the Trustee will have any responsibility or liability
for any aspect of the records relating to or payments made on account of beneficial ownership
interests of a Global Senior Note or maintaining, supervising or reviewing any records relating to
such beneficial ownership interests. Notwithstanding the foregoing, nothing herein shall prevent
the Company, the Trustee or any agent of the Company or the Trustee from giving effect to any
written certification, proxy or other authorization furnished by a Depositary or impair, as
between a Depositary and such holders of beneficial interests, the operation of customary
practices governing the exercise of the rights of the Depositary (or its nominee) as Holder of any
Senior Note.

     Section 3.5 Registration, Transfer and Exchange Generally.

     (a) The Trustee shall cause to be kept at the Corporate Trust Office a register (the
“Securities Register”) in which the registrar and transfer agent with respect to the Senior Notes
(the “Securities Registrar”), subject to such reasonable regulations as it may prescribe, shall
provide for the registration of Senior Notes and of transfers and exchanges of Senior Notes. The
Trustee shall at all times also be the Securities Registrar. The provisions of Article VI
shall apply to the Trustee in its role as Securities Registrar.

     (b) Subject
to compliance with Section 2.2(b), upon surrender for registration of
transfer of any Senior Note at the offices or agencies of the Company designated for that purpose
the Company shall execute, and the Trustee shall authenticate and deliver, in the name of the
designated transferee or transferees, one or more new Senior Notes of any authorized
denominations of like tenor and aggregate principal amount.

     (c) At the option of the Holder, Senior Notes may be exchanged for other Senior Notes of any
authorized denominations, of like tenor and aggregate principal amount, upon surrender of the
Senior Notes to be exchanged at such office or agency. Whenever any Senior Notes are so
surrendered for exchange, the Company shall execute, and the Trustee shall authenticate and
deliver, the Senior Notes that the Holder making the exchange is entitled to receive.

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

     (e) Every Senior Note presented or surrendered for transfer or exchange shall be duly
endorsed, or be accompanied by a written instrument of transfer in form satisfactory to the Company
and the Securities Registrar, duly executed by the Holder thereof or such Holder’s attorney duly
authorized in writing.

     (f) No service charge shall be made to a Holder for any transfer or exchange of Senior Notes,
but the Company may require payment of a sum sufficient to cover any tax or

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other governmental charge that may be imposed in connection with any transfer or exchange of
Senior Notes.

     (g) Neither the Company nor the Trustee shall be required pursuant to the provisions of this
Section 3.5: (i) to issue, register the transfer of or exchange any Senior Note during a
period beginning at the opening of business fifteen (15) days before the day of selection for
redemption of Senior Notes pursuant to Article XI and ending at the close of business on
the day of mailing of the notice of redemption or (ii) to register the transfer of or exchange any
Senior Note so selected for redemption in whole or in part, except, in the case of any such Senior
Note to be redeemed in part, any portion thereof not to be redeemed.

     (h) The Company shall designate an office or offices or agency or agencies where Senior Notes
may be surrendered for registration or transfer or exchange. The Company initially designates the
Corporate Trust Office as its office and agency for such purposes. The Company shall give prompt
written notice to the Trustee and to the Holders of any change in the location of any such office
or agency.

     (i) The Senior Notes may only be transferred to a “Qualified Purchaser” as such term is
defined in Section 2(a)(51) of the Investment Company Act.

     (j) Neither the Trustee nor the Securities Registrar shall be responsible for ascertaining
whether any transfer hereunder complies with the registration provisions of or any exemptions from
the Securities Act, applicable state securities laws or the applicable laws of any other
jurisdiction, ERISA, the Code or the Investment Company Act; provided, that if a
certificate is specifically required by the express terms of this Section 3.5 to be
delivered to the Trustee or the Securities Registrar by a Holder or transferee of a Senior Note,
the Trustee and the Securities Registrar shall be under a duty to receive and examine the same to
determine whether or not the certificate substantially conforms on its face to the requirements of
this Indenture and shall promptly notify the party delivering the same if such certificate does
not comply with such terms.

     Section 3.6 Mutilated, Destroyed, Lost and Stolen Senior Notes.

     (a) If any mutilated Senior Note is surrendered to the Trustee together with such security or
indemnity as may be required by the Company or the Trustee to save each of them harmless, the
Company shall execute and upon receipt thereof the Trustee shall authenticate and deliver in
exchange therefor a new Senior Note of like tenor and aggregate principal amount and bearing a
number not contemporaneously outstanding.

     (b) If there shall be delivered to the Trustee (i) evidence to its satisfaction of the
destruction, loss or theft of any Senior Note and (ii) such security or indemnity as may be
required by it to save each of the Company and the Trustee harmless, then, in the absence of notice
to the Company or the Trustee that such Senior Note has been acquired by a bona fide purchaser, the
Company shall execute and upon its written request the Trustee shall authenticate and deliver, in
lieu of any such destroyed, lost or stolen Senior Note, a new Senior Note of like tenor and
aggregate principal amount as such destroyed, lost or stolen Senior Note, and bearing a number not
contemporaneously outstanding.

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     (c) If any such mutilated, destroyed, lost or stolen Senior Note has become or is about to
become due and payable, the Company in its discretion may, instead of issuing a new Senior Note,
pay such Senior Note.

     (d) Upon
the issuance of any new Senior Note under this Section 3.6, the Company may
require the payment of a sum sufficient to cover any tax or other governmental charge that may be
imposed in relation thereto and any other expenses (including the fees and expenses of the Trustee)
connected therewith.

     (e) Every new Senior Note issued pursuant to this Section 3.6 in lieu of any
mutilated, destroyed, lost or stolen Senior Note shall constitute an original additional
contractual obligation of the Company, whether or not the mutilated, destroyed, lost or stolen
Senior Note shall be at any time enforceable by anyone, and shall be entitled to all the benefits
of this Indenture equally and proportionately with any and all other Senior Notes duly issued
hereunder.

     (f) The provisions of this Section 3.6 are exclusive and shall preclude (to the extent
lawful) all other rights and remedies with respect to the replacement or payment of mutilated,
destroyed, lost or stolen Senior Notes.

     Section 3.7
Persons Deemed Owners.

     The Company, the Trustee and any agent of the Company or the Trustee shall treat the Person
in whose name any Senior Note is registered as the owner of such Senior Note for the purpose of
receiving payment of principal of and any interest on such Senior Note and for all other purposes
whatsoever, and neither the Company, the Trustee nor any agent of the Company or the Trustee shall
be affected by notice to the contrary.

     Section 3.8
Cancellation.

     All Senior Notes surrendered for payment, redemption, transfer or exchange shall, if
surrendered to any Person other than the Trustee, be delivered to the Trustee, and any such Senior
Notes and Senior Notes surrendered directly to the Trustee for any such purpose shall be promptly
canceled by it. The Company may at any time deliver to the Trustee for cancellation any Senior
Notes previously authenticated and delivered hereunder that the Company may have acquired in any
manner whatsoever, and all Senior Notes so delivered shall be promptly canceled by the Trustee. No
Senior Notes shall be authenticated in lieu of or in exchange for any Senior Notes canceled as
provided in this Section 3.8, except as expressly permitted by this Indenture. All canceled
Senior Notes shall be retained or disposed of by the Trustee in accordance with its customary
practices and the Trustee shall deliver to the Company a certificate of such disposition.

     Section 3.9
Agreed Tax Treatment.

     Each Senior Note issued hereunder shall provide that the Company and, by its acceptance
or acquisition of a Senior Note or a beneficial interest therein, the Holder of, and any Person
that acquires a direct or indirect beneficial interest in, such Senior Note, intend and agree to
treat such Senior Note as indebtedness of the Company for United States federal, state and local
tax

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purposes. The provisions of this Indenture shall be interpreted to further this intention
and agreement of the parties.

     Section 3.10
CUSIP Numbers.

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

ARTICLE IV

SATISFACTION AND DISCHARGE

     Section 4.1
Satisfaction and Discharge of Indenture.

     This Indenture shall, upon Company Request, cease to be of further effect (except as to any
surviving rights of registration of transfer or exchange of Senior Notes herein expressly provided
for and as otherwise provided in this Section 4.1) and the Trustee, on written demand of
and at the expense of the Company, shall execute proper instruments acknowledging satisfaction and
discharge of this Indenture, when

     (a) either

     (i) all Senior Notes theretofore authenticated and delivered (other than (A) Senior
Notes that have been mutilated, destroyed, lost or stolen and that have been replaced or
paid as provided in Section 3.6 and (B) Senior Notes for whose payment money has
theretofore been deposited in trust or segregated and held in trust by the Company and
thereafter repaid to the Company or discharged from such trust as provided in Section
10.2) have been delivered to the Trustee for cancellation; or

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

     (A) have become due and payable; or

     (B) will become due and payable at their Stated Maturity within one (1) year of
the date of deposit; or

     (C) are to be called for redemption within one (1) year under
arrangements satisfactory to the Trustee for the giving of notice of redemption by
the Trustee in the name, and at the expense, of the Company;

and the Company, in the case of subclause (ii)(A), (B) or (C) above, has deposited or
caused to be deposited with the Trustee as trust funds in trust for such purpose (x) an
amount in the currency or currencies in which the Senior Notes are payable, (y)

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Government Obligations which through the scheduled payment of principal and interest
in respect thereof in accordance with their terms will provide, not later than the due date
of any payment, money in an amount or (z) a combination thereof, in each case sufficient,
in the opinion of a nationally recognized firm of independent public accountants expressed
in a written certification thereof delivered to the Trustee, to pay and discharge the
entire indebtedness on such Senior Notes not theretofore delivered to the Trustee for
cancellation, for principal and any premium and interest (including any Additional
Interest) to the date of such deposit (in the case of Senior Notes that have become due and
payable) or to the Stated Maturity (or any date of principal repayment upon early maturity)
or Redemption Date, as the case may be;

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

     (c) the Company has delivered to the Trustee an Officers’ Certificate and an Opinion of
Counsel each stating that all conditions precedent herein provided for relating to the
satisfaction and discharge of this Indenture have been complied with.

Notwithstanding the satisfaction and discharge of this Indenture, the obligations of the Company
to the Trustee under Section 6.6, the obligations of the Company to any Authenticating
Agent under Section 6.11 and, if money shall have been deposited with the Trustee pursuant
to subclause (a)(ii) of this Section 4.1, the obligations of the Trustee under Section 4.2
and Section 10.2(e) shall survive.

     Section 4.2
Application of Trust Money.

     Subject to the provisions of Section 10.2(e), all money deposited with the Trustee
pursuant to Section 4.1 shall be held in trust and applied by the Trustee, in accordance
with the provisions of the Senior Notes and this Indenture, to the payment in accordance with
Section 3.1, 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 any premium and interest (including any Additional Interest) for the payment of which
such money or obligations have been deposited with or received by the Trustee.

ARTICLE V

REMEDIES

     Section 5.1
Events of Default.

     “Event of Default” means, wherever used herein with respect to the Senior Notes, any
one of the following events (whatever the reason for such Event of Default and whether it shall be
voluntary or involuntary or be effected by operation of law or pursuant to any judgment, decree or
order of any court or any order, rule or regulation of any administrative or governmental body):

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     (a) default in the payment of any interest upon any Senior Note, including any
Additional Interest in respect thereof, when it becomes due and payable, and continuance of such
default for a period of thirty (30) days; or

     (b) default in the payment of the principal of or any premium on any Senior Note at its
Maturity; or

     (c) default in the performance, or breach, of any covenant or warranty of the Company in this
Indenture or the Purchase Agreement and continuance of such default or breach for a period of
thirty (30) days after there has been given, by registered or certified mail, to the Company by the
Trustee or to the Company and the Trustee by the Holders of at least twenty-five percent (25%) in
aggregate principal amount of the Outstanding Senior Notes a written notice specifying such default
or breach and requiring it to be remedied and stating that such notice is a “Notice of Default”
hereunder (a “Notice of Default”); provided, that any default in the performance or breach
of the covenant set forth in Section 10.8 shall constitute an Event of Default immediately
upon such default or breach (without any obligation of the Trustee or the Holders to deliver a
Notice of Default) and the Holders shall have the immediate right to exercise all remedies granted
to the Holders under this Indenture; or

     (d) the entry by a court having jurisdiction in the premises of a decree or order adjudging
the Company a bankrupt or insolvent, or approving as properly filed a petition seeking
reorganization, arrangement, adjustment or composition of or in respect of the Company under any
applicable federal or state bankruptcy, insolvency, reorganization or other similar law, or
appointing a custodian, receiver, liquidator, assignee, trustee, sequestrator or other similar
official of the Company or of any substantial part of its property, or ordering the winding up or
liquidation of its affairs, and the continuance of any such decree or order for relief or any such
other decree or order unstayed and in effect for a period of sixty (60) consecutive days; or

     (e) the institution by the Company of proceedings to be adjudicated a bankrupt or insolvent,
or the consent by the Company to the institution of bankruptcy or insolvency proceedings against
it, or the filing by the Company of a petition or answer or consent seeking reorganization or
relief under any applicable federal or state bankruptcy, insolvency, reorganization
or other similar law, or the consent by it to the filing of such petition or to the appointment of
or taking possession by a custodian, receiver, liquidator, assignee, trustee, sequestrator or other
similar official of the Company or of any substantial part of its property, or the making by it of
an assignment for the benefit of creditors, or the admission by it in writing of its inability to
pay its debts generally as they become due and its willingness to be adjudicated a bankrupt or
insolvent, or the taking of corporate action by the Company in furtherance of any such action.

     Section 5.2 Acceleration of Maturity; Rescission and Annulment.

     (a) If an Event of Default occurs and is continuing, then and in every such case the Trustee
or the Holders of not less than twenty-five percent (25%) in aggregate principal amount of the
Outstanding Senior Notes may declare the principal amount of all the Senior Notes to be
immediately due and payable, by a notice in writing to the Company (and to the Trustee if given by
Holders).

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     (b) At any time after such a declaration of acceleration with respect to Senior Notes has
been made and before a judgment or decree for payment of the money due has been obtained by the
Trustee as hereinafter provided in this Article V, the Holders of a majority in aggregate
principal amount of the Outstanding Senior Notes, by written notice to the Trustee, may rescind
and annul such declaration and its consequences if:

     (i) the Company has paid or deposited with the Trustee a sum sufficient to pay:

     (A) all overdue installments of interest on all Senior Notes;

     (B) any accrued Additional Interest on all Senior Notes;

     (C) the principal of and any premium on any Senior Notes that have become
due otherwise than by such declaration of acceleration and interest (including any
Additional Interest) thereon at the rate borne by the Senior Notes;

     (D) all sums paid or advanced by the Trustee hereunder and the
reasonable compensation, expenses, disbursements and advances of the Trustee and its
agents and counsel;

     (E) all sums paid or advanced by the Holders hereunder and the reasonable fees,
expenses, disbursements and advances of the Holders and their agents and counsel in
connection with the relevant default; and

     (ii)
all Events of Default with respect to Senior Notes, other than the non-payment of
the principal of Senior Notes that has become due solely by such acceleration, have been
cured or waived as provided in Section 5.13;

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

     Section 5.3 Collection of Indebtedness and Suits for Enforcement by Trustee. 

     (a) The Company covenants that if:

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

     (ii) default is made in the payment of the principal of and any premium on any Senior
Note at the Maturity thereof;

the Company will, upon demand of the Trustee, pay to the Trustee, for the benefit of the Holders
of such Senior Notes, the whole amount then due and payable on such Senior Notes for principal and
any premium and interest (including any Additional Interest) and, in addition thereto, all amounts
owing the Trustee under Section 6.6 and all sums paid or advanced by the Holders hereunder
and the reasonable fees, expenses, disbursements and advances of the Holders and their agents and
counsel in connection with such default.

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

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

     Section 5.4 Trustee May File Proofs of Claim.

     In case of any receivership, insolvency, liquidation, bankruptcy, reorganization,
arrangement, adjustment, composition or similar judicial proceeding relative to the Company (or
any other obligor upon the Senior Notes), its property or its creditors, the Trustee shall be
entitled and empowered, by intervention in such proceeding or otherwise, to take any and all
actions authorized hereunder in order to have claims of the Holders and the Trustee allowed in any
such proceeding. In particular, the Trustee shall be authorized to collect and receive any moneys
or other property payable or deliverable on any such claims and to distribute the same; and any
custodian, receiver, assignee, trustee, liquidator, sequestrator or other similar official in any
such judicial proceeding is hereby authorized by each Holder to make such payments to the Trustee
and, in the event that the Trustee shall consent to the making of such payments directly to the
Holders, to first pay to the Trustee any amount due it for the reasonable compensation, expenses,
disbursements and advances of the Trustee, its agents and counsel, and any other amounts owing the
Trustee, any predecessor Trustee and other Persons under Section 6.6.

     Section 5.5 Trustee May Enforce Claim Without Possession of Senior Notes.

     All rights of action and claims under this Indenture or the Senior Notes may be prosecuted and
enforced by the Trustee without the possession of any of the Senior Notes or the production thereof
in any proceeding relating thereto, and any such proceeding instituted by the Trustee shall be
brought in its own name as trustee of an express trust, and any recovery of judgment shall after
provision for the payment of all the amounts owing the Trustee, any predecessor Trustee and other
Persons under Section 6.6, be for the ratable benefit of the Holders of the Senior Notes in
respect of which such judgment has been recovered.

     Section 5.6 Application of Money Collected.

     Any money or property collected or to be applied by the Trustee with respect to the Senior
Notes pursuant to this Article V shall be applied in the following order, at the date or
dates fixed by the Trustee and, in case of the distribution of such money or property on account
of principal or any premium or interest (including any Additional Interest), upon presentation of

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the Senior Notes and the notation thereon of the payment if only partially paid and upon surrender
thereof if fully paid:

     FIRST: To the payment of all amounts due the Trustee, any predecessor Trustee and other
Persons under Section 6.6;

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

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

     Section 5.7 Limitation on Suits.

     Subject to Section 5.8, no Holder of any Senior Notes shall have any right to
institute any proceeding, judicial or otherwise, with respect to this Indenture or for the
appointment of a custodian, receiver, assignee, trustee, liquidator, sequestrator (or other
similar official) or for any other remedy hereunder, unless:

     (a) such Holder has previously given written notice to the Trustee of a continuing Event of
Default with respect to the Senior Notes;

     (b) the Holders of not less than a majority in aggregate principal amount of the Outstanding
Senior Notes shall have made written request to the Trustee to institute proceedings in respect of
such Event of Default in its own name as Trustee hereunder;

     (c) such Holder or Holders have offered to the Trustee reasonable indemnity against the costs,
expenses and liabilities to be incurred in compliance with such request;

     (d) the Trustee after its receipt of such notice, request and offer of indemnity has failed to
institute any such proceeding for sixty (60) days; and

     (e) no direction inconsistent with such written request has been given to the Trustee during
such sixty (60)-day period by the Holders of a majority in aggregate principal amount of the
Outstanding Senior Notes;

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

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     Section 5.8 Unconditional Right of Holders to Receive Principal, Premium, if any, and
Interest.

     Notwithstanding any other provision in this Indenture, the Holder of any Senior Note shall
have the right, which is absolute and unconditional, to receive payment of the principal of and
premium, if any, on such Senior Note at its Maturity and payment of interest (including any
Additional Interest) on such Senior Note when due and payable and to institute suit for the
enforcement of any such payment, and such right shall not be impaired without the consent of such
Holder.

     Section 5.9 Restoration of Rights and Remedies.

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

     Section 5.10 Rights and Remedies Cumulative.

     Except as otherwise provided in Section 3.6(f), no right or remedy herein conferred
upon or reserved to the Trustee or the Holders is intended to be exclusive of any other right or
remedy, and every right and remedy shall, to the extent permitted by law, be cumulative and in
addition to every other right and remedy given hereunder or now or hereafter existing at law or in
equity or otherwise. The assertion or employment of any right or remedy hereunder, or otherwise,
shall not prevent the concurrent assertion or employment of any other appropriate right or remedy.

     Section 5.11 Delay or Omission Not Waiver.

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

     Section 5.12 Control by Holders.

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

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

40

 

     (b) the Trustee may take any other action deemed proper by the Trustee that is not
inconsistent with such direction; and

     (c) subject to
the provisions of Section 6.2, the Trustee shall have the right to decline to
follow such direction if a Responsible Officer or Officers of the Trustee shall, in good faith,
reasonably determine that the proceeding so directed would be unjustly prejudicial to the Holders
not joining in any such direction or would involve the Trustee in personal liability.

     Section 5.13 Waiver of Past Defaults.

     (a) The Holders of not less than a majority in aggregate principal amount of the Outstanding
Senior Notes may waive any past Event of Default hereunder and its consequences except an Event of
Default:

     (i) in the payment of the principal of, premium, if any, or interest (including any
Additional Interest) on any Outstanding Senior Note (unless such Event of Default has been
cured and the Company has paid to or deposited with the Trustee a sum sufficient to pay all
installments of interest (including any Additional Interest) due and past due and all
principal of and premium, if any, on all Senior Notes due otherwise than by acceleration);
or

     (ii) in respect of a covenant or provision hereof that under Article IX cannot
be modified or amended without the consent of each Holder of any Outstanding Senior
Note.

     (b) Any such waiver shall be deemed to be on behalf of the Holders of all the Outstanding
Senior Notes.

     (c) Upon any such waiver, such Event of 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 Event of Default or impair any right consequent
thereon.

     Section 5.14 Undertaking for Costs.

     All parties to this Indenture agree, and each Holder of any Senior Note by his or her
acceptance thereof shall be deemed to have agreed, that any court may in its discretion require, in
any suit for the enforcement of any right or remedy under this Indenture, or in any suit against
the Trustee for any action taken or omitted by it as Trustee, the filing by any party litigant in
such suit of an undertaking to pay the costs of such suit, and that such court may in its
discretion assess reasonable costs, including reasonable attorneys’ fees and expenses, against any
party litigant in such suit, having due regard to the merits and good faith of the claims or
defenses made by such party litigant; provided, however, that the provisions of this
Section 5.14 shall not apply to any suit instituted by the Trustee, to any suit instituted
by any Holder, or group of Holders, holding in the aggregate more than ten percent (10%) in
aggregate principal amount of the Outstanding Senior Notes, or to any suit instituted by any Holder
for the enforcement of the payment of the principal of or premium, if any, on the Senior Note after
the Stated Maturity or any interest (including any Additional Interest) on any Senior Note after it
is due and payable.

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     Section 5.15 Waiver of Usury, Stay or Extension Laws.

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

ARTICLE VI

THE TRUSTEE

     Section 6.1 Corporate Trustee Required.

     There shall at all times be a Trustee hereunder with respect to the Senior Notes. The Trustee
shall be a corporation or national banking association organized and doing business under the laws
of the United States or of any state thereof, authorized to exercise corporate trust powers, having
a combined capital and surplus of at least $50,000,000, subject to supervision or examination by
federal or state authority and having an office within the United States. If such entity publishes
reports of condition at least annually, pursuant to law or to the requirements of such supervising
or examining authority, then, for the purposes of this Section 6.1, the combined capital
and surplus of such entity shall be deemed to be its combined capital and surplus as set forth in
its most recent report of condition so published. If at any time the Trustee shall cease to be
eligible in accordance with the provisions of this Section 6.1, it shall resign immediately
in the manner and with the effect hereinafter specified in this Article VI.

     Section 6.2 Certain Duties and Responsibilities.

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

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

     (ii) in the absence of bad faith on its part, the Trustee may conclusively rely, as to
the truth of the statements and the correctness of the opinions expressed therein, upon
certificates or opinions furnished to the Trustee and conforming to the requirements of this
Indenture; provided, that in the case of any such certificates or opinions that by
any provision hereof are specifically required to be furnished to the Trustee, the Trustee
shall be under a duty to examine the same to determine whether or not they substantially
conform on their face to the requirements of this Indenture.

     (b) If an Event of Default known to the Trustee has occurred and is continuing, the Trustee
shall, prior to the receipt of directions, if any, from the Holders of at least a majority in
aggregate principal amount of the Outstanding Senior Notes, exercise such of the rights and

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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.

     (c) Notwithstanding the foregoing, no provision of this Indenture shall require the Trustee to
expend or risk its own funds or otherwise incur any financial liability in the performance of any
of its duties hereunder, or in the exercise of any of its rights or powers, if it shall have
reasonable grounds for believing that repayment of such funds or adequate indemnity against such
risk or liability is not reasonably assured to it. Whether or not therein expressly so provided,
every provision of this Indenture relating to the conduct or affecting the liability of or
affording protection to the Trustee shall be subject to the provisions of this Section 6.2.
To the extent that, at law or in equity, the Trustee has duties and liabilities relating to the
Holders, the Trustee shall not be liable to any Holder for the Trustee’s good faith reliance on the
provisions of this Indenture. The provisions of this Indenture, to the extent that they restrict
the duties and liabilities of the Trustee otherwise existing at law or in equity, are agreed by the
Company and the Holders to replace such other duties and liabilities of the Trustee.

     (d) No provisions of this Indenture shall be construed to relieve the Trustee from liability
with respect to matters that are within the authority of the Trustee under this Indenture for its
own negligent action, negligent failure to act or willful misconduct, except that:

     (i) the Trustee shall not be liable for any error or judgment made in good faith by an
authorized officer of the Trustee, unless it shall be proved that the Trustee was negligent
in ascertaining the pertinent facts;

     (ii) the Trustee shall not be liable with respect to any action taken or omitted to be
taken by it in good faith in accordance with the direction of the Holders of at least a
majority in aggregate principal amount of the Outstanding Senior Notes (or such other
percentage as may be required by the terms hereof) relating to the time, method and place
of conducting any proceeding for any remedy available to the Trustee under this Indenture;
and

     (iii) the Trustee shall be under no liability for interest on any money received by it
hereunder except as otherwise agreed in writing with the Company and money held by the
Trustee in trust hereunder need not be segregated from other funds except to the extent
required by law.

     Section 6.3 Notice of Defaults.

     Within ninety (90) days after the occurrence of any default actually known to the Trustee, the
Trustee shall give the Holders notice of such default unless such default shall have been cured or
waived; provided, that except in the case of a default in the payment of the principal of
or any premium or interest on any Senior Notes, the Trustee shall be fully protected in withholding
the notice if and so long as the board of directors, the executive committee or a trust committee
of directors and/or Responsible Officers of the Trustee in good faith determines that withholding
the notice is in the interest of Holders; and provided,
further, that in the case of any
default of the character specified in Section 5.1(c), no such notice to Holders shall be
given until

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at least thirty (30) days after the occurrence thereof. For the purpose of this Section
6.3, the term “default” means any event which is, or after notice or lapse of time or both
would become, an Event of Default.

     Section 6.4 Certain Rights of Trustee.

     Subject to the provisions of Section 6.2:

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

     (b) if (i) in performing its duties under this Indenture the Trustee is required to decide
between alternative courses of action, (ii) in construing any of the provisions of this Indenture
the Trustee finds ambiguous or inconsistent with any other provisions contained herein or (iii) the
Trustee is unsure of the application of any provision of this Indenture, then, except as to any
matter as to which the Holders are entitled to decide under the terms of this Indenture, the
Trustee shall deliver a notice to the Company requesting the Company’s written instruction as to
the course of action to be taken and the Trustee shall take such action, or refrain from taking
such action, as the Trustee shall be instructed in writing to take, or to refrain from taking, by
the Company; provided, that if the Trustee does not receive such instructions from the
Company within ten (10) Business Days after it has delivered such notice or such reasonably shorter
period of time set forth in such notice the Trustee may, but shall be under no duty to, take such
action, or refrain from taking such action, as the Trustee shall deem advisable and in the best
interests of the Holders, in which event the Trustee shall have no liability except for its own
negligence, bad faith or willful misconduct;

     (c) any request or direction of the Company shall be sufficiently evidenced by a Company
Request or Company Order and any resolution of the Board of Directors may be sufficiently evidenced
by a Board Resolution;

     (d) the Trustee may consult with counsel (which counsel may be counsel to the Trustee, the
Company or any of its Affiliates, and may include any of its employees) and the advice of such
counsel or any Opinion of Counsel shall be full and complete authorization and protection in
respect of any action taken, suffered or omitted by it hereunder in good faith and in reliance
thereon;

     (e) the Trustee shall be under no obligation to exercise any of the rights or powers vested in
it by this Indenture at the request or direction of any of the Holders pursuant to this Indenture,
unless such Holders shall have offered to the Trustee security or indemnity reasonably satisfactory
to it against the costs, expenses (including reasonable attorneys’ fees and expenses) and
liabilities that might be incurred by it in compliance with such request or direction, including
reasonable advances as may be requested by the Trustee;

     (f) the Trustee shall not be bound to make any investigation into the facts or matters stated
in any resolution, certificate, statement, instrument, opinion, report, notice, request,

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direction, consent, order, bond, indenture, note or other paper or document, but the Trustee in
its discretion may make such inquiry or investigation into such facts or matters as it may see
fit, and, if the Trustee shall determine to make such inquiry or investigation, it shall be
entitled to examine the books, records and premises of the Company, personally or by agent or
attorney;

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

     (h) whenever in the administration of this Indenture the Trustee shall deem it desirable to
receive instructions with respect to enforcing any remedy or right or taking any other action with
respect to enforcing any remedy or right hereunder, the Trustees (i) may request instructions from
the Holders (which instructions may only be given by the Holders of the same aggregate principal
amount of Outstanding Senior Notes as would be entitled to direct the Trustee under this Indenture
in respect of such remedy, right or action), (ii) may refrain from enforcing such remedy or right
or taking such action until such instructions are received and (iii) shall be protected in acting
in accordance with such instructions;

     (i) except as otherwise expressly provided by this Indenture, the Trustee shall not be under
any obligation to take any action that is discretionary under the provisions of this Indenture;

     (j) without prejudice to any other rights available to the Trustee under applicable law, when
the Trustee incurs expenses or renders services in connection with any bankruptcy, insolvency or
other proceeding referred to in clauses (d) or (e) of the definition of Event of Default specified
in Section 5.1, such expenses (including legal fees and expenses of its agents and counsel)
and the compensation for such services are intended to constitute expenses of administration under
any bankruptcy laws or law relating to creditors rights generally;

     (k) whenever in the administration of this Indenture the Trustee shall deem it desirable that
a matter be proved or established prior to taking, suffering or omitting any action hereunder, the
Trustee (unless other evidence be herein specifically prescribed) may, in the absence of bad faith
on its part, conclusively rely upon an Officers’ Certificate addressing such matter, which, upon
receipt of such request, shall be promptly delivered by the Company;

     (l) the Trustee shall not be charged with knowledge of any Event of Default unless either (i)
a Responsible Officer of the Trustee shall have actual knowledge or (ii) the Trustee shall have
received written notice thereof from the Company or a Holder; and

     (m) in the event that the Trustee is also acting as Paying Agent, Authenticating Agent or
Securities Registrar hereunder, the rights and protections afforded to the Trustee pursuant to
this Article VI shall also be afforded such Paying Agent, Authenticating Agent or
Securities Registrar.

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     Section 6.5 May Hold Senior Notes.

     The Trustee, any Authenticating Agent, any Paying Agent, any Securities Registrar or any
other agent of the Company, in its individual or any other capacity, may become the owner or
pledgee of Senior Notes and may otherwise deal with the Company with the same rights it would have
if it were not Trustee, Authenticating Agent, Paying Agent, Securities Registrar or such other
agent.

     Section 6.6 Compensation; Reimbursement; Indemnity.

     (a) The Company agrees:

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

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

     (iii) to the fullest extent permitted by applicable law, to indemnify the Trustee
(including in its individual capacity) and its Affiliates, and their officers, directors,
shareholders, agents, representatives and employees for, and to hold them harmless against,
any loss, damage, liability, tax (other than income, franchise or other taxes imposed on
amounts paid pursuant to clause (i) or (ii) of this Section 6.6(a)), penalty,
expense or claim of any kind or nature whatsoever incurred without negligence, bad faith or
willful misconduct on its part arising out of or in connection with the acceptance or
administration of this trust or the performance of the Trustee’s duties hereunder,
including the costs and expenses of defending itself against any claim or liability in
connection with the exercise or performance of any of its powers or duties hereunder.

     (b) To secure the Company’s payment obligations in this Section 6.6, the Company
hereby grants and pledges to the Trustee and the Trustee shall have a lien prior to the Senior
Notes on all money or property held or collected by the Trustee, other than money or property held
in trust to pay principal and interest on particular Senior Notes. Such lien shall survive the
satisfaction and discharge of this Indenture or the resignation or removal of the Trustee.

     (c) The obligations of the Company under this Section 6.6 shall survive the
satisfaction and discharge of this Indenture and the earlier resignation or removal of the Trustee.

     (d) In no event shall the Trustee be liable for any indirect, special, punitive or
consequential loss or damage of any kind whatsoever, including, but not limited to, lost profits,
even if the Trustee has been advised of the likelihood of such loss or damage and regardless of the
form of action.

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     (e) In no event shall the Trustee be liable for any failure or delay in the performance of
its obligations hereunder because of circumstances beyond its control, including, but not limited
to, acts of God, flood, war (whether declared or undeclared), terrorism, fire, riot, embargo,
government action, including any laws, ordinances, regulations, governmental action or the like
which delay, restrict or prohibit the providing of the services contemplated by this Indenture.

     Section 6.7
Resignation and Removal; Appointment of Successor.

     (a) No resignation or removal of the Trustee and no appointment of a successor Trustee
pursuant to this Article VI shall become effective until the acceptance of appointment by
the successor Trustee under Section 6.8.

     (b) The Trustee may resign at any time by giving written notice thereof to the Company.

     (c) Unless an Event of Default shall have occurred and be continuing, the Trustee may be
removed at any time by the Company by a Board Resolution. If an Event of Default shall have
occurred and be continuing, the Trustee may be removed by Act of the Holders of a majority in
aggregate principal amount of the Outstanding Senior Notes, delivered to the Trustee and to the
Company.

     (d) If the Trustee shall resign, be removed or become incapable of acting, or if a vacancy
shall occur in the office of Trustee for any reason, at a time when no Event of Default shall have
occurred and be continuing, the Company, by a Board Resolution, shall promptly appoint a successor
Trustee, and such successor Trustee and the retiring Trustee shall comply with the applicable
requirements of Section 6.8. If the Trustee shall resign, be removed or become incapable
of acting, or if a vacancy shall occur in the office of Trustee for any reason, at a time when an
Event of Default shall have occurred and be continuing, the Holders, by Act of the Holders of a
majority in aggregate principal amount of the Outstanding Senior Notes, shall promptly appoint a
successor Trustee, and such successor Trustee and the retiring Trustee shall comply with the
applicable requirements of Section 6.8. If no successor Trustee shall have been so
appointed by the Company or the Holders and accepted appointment within sixty (60) days after the
giving of a notice of resignation by the Trustee or the removal of the Trustee in the manner
required by Section 6.8, any Holder who has been a bona fide Holder of a Senior Note for at
least six (6) months may, on behalf of such Holder and all others similarly situated, and any
resigning Trustee may, at the expense of the Company, petition any court of competent jurisdiction
for the appointment of a successor Trustee.

     (e) The Company shall give notice to all Holders in the manner provided in Section 1.6
of each resignation and each removal of the Trustee and each appointment of a successor Trustee.
Each notice shall include the name of the successor Trustee and the address of its Corporate Trust
Office.

     Section 6.8 Acceptance of Appointment by Successor.

     (a) In case of the appointment hereunder of a successor Trustee, each successor Trustee so
appointed shall execute, acknowledge and deliver to the Company and to the retiring

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Trustee an instrument accepting such appointment, and thereupon the resignation or removal of the
retiring Trustee shall become effective and such successor Trustee, without any further act, deed
or conveyance, shall become vested with all the rights, powers, trusts and duties of the retiring
Trustee; provided, that on the request of the Company or the successor Trustee, such
retiring Trustee shall, upon payment of its charges, execute and deliver an instrument
transferring to such successor Trustee all the rights, powers and trusts of the retiring Trustee
and shall duly assign, transfer and deliver to such successor Trustee all property and money held
by such retiring Trustee hereunder.

     (b) Upon request of any such successor Trustee, the Company shall execute any and all
instruments for more fully and certainly vesting in and confirming to such successor Trustee all
rights, powers and trusts referred to in paragraph (a) of this Section 6.8.

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

     Section 6.9 Merger, Conversion, Consolidation or Succession to Business.

     Any Person into which the Trustee may be merged or converted or with which it may be
consolidated, or any Person resulting from any merger, conversion or consolidation to which the
Trustee shall be a party, or any Person succeeding to all or substantially all of the corporate
trust business of the Trustee, shall be the successor of the Trustee hereunder, without the
execution or filing of any paper or any further act on the part of any of the parties hereto;
provided, that such Person shall be otherwise qualified and eligible under this
Article VI. In case any Senior Notes shall have been authenticated, but not delivered, by
the Trustee then in office, any successor by merger, conversion or consolidation or as otherwise
provided above in this Section 6.9 to such authenticating Trustee may adopt such
authentication and deliver the Senior Notes so authenticated, and in case any Senior Notes shall
not have been authenticated, any successor to the Trustee may authenticate such Senior Notes
either in the name of any predecessor Trustee or in the name of such successor Trustee, and in all
cases the certificate of authentication shall have the full force which it is provided anywhere in
the Senior Notes or in this Indenture that the certificate of the Trustee shall have.

     Section 6.10 Not Responsible for Recitals or Issuance of Senior Notes.

     The recitals contained herein and in the Senior Notes, except the Trustee’s certificates of
authentication, shall be taken as the statements of the Company, and neither the Trustee nor any
Authenticating Agent assumes any responsibility for their correctness. The Trustee makes no
representations as to the validity or sufficiency of this Indenture or of the Senior Notes. Neither
the Trustee nor any Authenticating Agent shall be accountable for the use or application by the
Company of the Senior Notes or the proceeds thereof.

     Section 6.11 Appointment of Authenticating Agent.

     (a) The Trustee may appoint an Authenticating Agent or Agents with respect to the Senior
Notes, which shall be authorized to act on behalf of the Trustee to authenticate Senior Notes
issued upon original issue and upon exchange, registration of transfer or partial redemption
thereof or pursuant to Section 3.6, and Senior Notes so authenticated shall be entitled

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to the benefits of this Indenture and shall be valid and obligatory for all purposes as if
authenticated by the Trustee hereunder. Wherever reference is made in this Indenture to the
authentication and delivery of Senior Notes by the Trustee or the Trustee’s certificate of
authentication, such reference shall be deemed to include authentication and delivery on behalf of
the Trustee by an Authenticating Agent. Each Authenticating Agent shall be acceptable to the
Company and shall at all times be an entity organized and doing business under the laws of the
United States of America, or of any State or Territory thereof or the District of Columbia,
authorized under such laws to act as Authenticating Agent, having a combined capital and surplus
of not less than $50,000,000 and subject to supervision or examination by federal or state
authority. If such Authenticating Agent publishes reports of condition at least annually pursuant
to law or to the requirements of said supervising or examining authority, then for the purposes of
this Section 6.11 the combined capital and surplus of such Authenticating Agent shall be deemed to
be its combined capital and surplus as set forth in its most recent report of condition so
published. If at any time an Authenticating Agent shall cease to be eligible in accordance with
the provisions of this Section 6.11, such Authenticating Agent shall resign immediately in
the manner and with the effect specified in this Section 6.11.

     (b) Any Person into which an Authenticating Agent may be merged or converted or with which it
may be consolidated, or any Person resulting from any merger, conversion or consolidation to which
such Authenticating Agent shall be a party, or any Person succeeding to all or substantially all of
the corporate trust business of an Authenticating Agent shall be the successor Authenticating Agent
hereunder; provided, that such Person shall be otherwise eligible under this Section 6.11,
without the execution or filing of any paper or any further act on the part of the Trustee or the
Authenticating Agent.

     (c) An Authenticating Agent may resign at any time by giving written notice thereof to the
Trustee and to the Company. The Trustee may at any time terminate the agency of an Authenticating
Agent by giving written notice thereof to such Authenticating Agent and to the Company. Upon
receiving such a notice of resignation or upon such a termination, or in case at any time such
Authenticating Agent shall cease to be eligible in accordance with the provisions of this
Section 6.11, the Trustee may appoint a successor Authenticating Agent eligible under the
provisions of this Section 6.11, which shall be acceptable to the Company, and shall give
notice of such appointment to all Holders. Any successor Authenticating Agent upon acceptance of
its appointment hereunder shall become vested with all the rights, powers and duties of its
predecessor hereunder, with like effect as if originally named as an Authenticating Agent.

     (d) The Company agrees to pay to each Authenticating Agent from time to time reasonable
compensation for its services under this Section 6.11 in such amounts as the Company and
the Authenticating Agent shall agree from time to time.

     (e) If an appointment of an Authenticating Agent is made pursuant to this Section
6.11, the Senior Notes may have endorsed thereon, in addition to the Trustee’s certificate of
authentication, an alternative certificate of authentication in the following form:

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

Dated:

	 	 	 	 	 
	 	WELLS FARGO BANK, N.A., not in its 

individual capacity, but solely as Trustee

 	 
	 	By:  	 	 
	 	 	Authenticating Agent 	 
	 	 	 	 
	 
	 	 	 
	 	By:  	
 	 
	 	 	Authorized Signatory 	 

ARTICLE VII

HOLDER’S LISTS AND REPORTS BY COMPANY

     Section 7.1 Company to Furnish Trustee Names and Addresses of Holders. 

     The Company will furnish or cause to be furnished to the Trustee:

     (a) semiannually, on or before June 30 and December 31 of each year, a list, in such form as
the Trustee may reasonably require, of the names and addresses of the Holders as of a date not more
than fifteen (15) days prior to the delivery thereof; and

     (b) at such other times as the Trustee may request in writing, within thirty (30) days
after the receipt by the Company of any such request, a list of similar form and content as of a
date not more than fifteen (15) days prior to the time such list is furnished;

in each case to the extent such information is in the possession or control of the Company and has
not otherwise been received by the Trustee in its capacity as Securities Registrar.

     Section 7.2 Preservation of Information, Communications to Holders.

     (a) The Trustee shall preserve, in as current a form as is reasonably practicable, the names
and addresses of Holders contained in the most recent list furnished to the Trustee as provided in
Section 7.1 and the names and addresses of Holders received by the Trustee in its capacity
as Securities Registrar. The Trustee may destroy any list furnished to it as provided in
Section 7.1 upon receipt of a new list so furnished.

     (b) The rights of Holders to communicate with other Holders with respect to their rights under
this Indenture or under the Senior Notes, and the corresponding rights and privileges of the
Trustee, shall be as provided in the Trust Indenture Act.

     (c) Every Holder of Senior Notes, by receiving and holding the same, agrees with the Company
and the Trustee that neither the Company nor the Trustee nor any agent of either of them shall be
held accountable by reason of the disclosure of information as to the names and addresses of the
Holders made pursuant to the Trust Indenture Act.

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     Section 7.3 Reports by Company.

     (a) The Company shall furnish to the Holders and to prospective purchasers of Senior Notes,
upon their request, the information required to be furnished pursuant to Rule 144A(d)(4) under the
Securities Act. The delivery requirement set forth in the preceding sentence may be satisfied by
compliance with Section 7.3(b).

     (b) The Company shall furnish to each of (i) the Trustee, (ii) the Holders and to subsequent
holders of Senior Notes, (iii) Kodiak Capital Management Company LLC, 2107 Wilson Boulevard, Suite
400, Arlington, Virginia 22201, Attention: Robert M. Hurley or such other address as designated by
Kodiak Capital Management Company LLC) and (iv) any beneficial owner of the Senior Notes reasonably
identified to the Company (which identification may be made either by such beneficial owner or by
Kodiak Capital Management Company LLC), a duly completed and executed officer’s
financial certificate substantially and substantively in the form attached hereto as
Exhibit A, including the financial statements referenced in such Exhibit, which certificate
and financial statements shall be so furnished by the Company not later than forty-five (45) days
after the end of each of the first three (3) fiscal quarters of each fiscal year of the Company and
not later than ninety (90) days after the end of each fiscal year of the Company, or, if
applicable, such shorter respective periods as may then be required by the Commission for the
filing by the Company of quarterly reports on Form 10-Q and annual reports on Form 10-K.

     (c) If the Company intends to file its annual and quarterly information with the Securities
and Exchange Commission (the “Commission”) in electronic form pursuant to Regulation S-T of the
Commission using the Commission’s Electronic Data Gathering,
Analysis and Retrieval (“EDGAR”)
system, the Company shall notify the Trustee in the manner prescribed herein of each such annual
and quarterly filing. The Trustee is hereby authorized and directed to access the EDGAR system for
purposes of retrieving the financial information so filed. Compliance with the foregoing shall
constitute delivery by the Company of its financial statements to the Trustee in compliance with
the provisions of Section 314(a) of the Trust Indenture Act, if applicable. The Trustee shall
have no duty to search for or obtain any electronic or other filings that the Company makes with
the Commission, regardless of whether such filings are periodic, supplemental or otherwise.
Delivery of reports, information and documents to the Trustee pursuant to this Section
7.3(c) shall be solely for purposes of compliance with this Section 7.3(c) and, if
applicable, with Section 314(a) of the Trust Indenture Act, and shall not relieve the Company of
the requirement to deliver the certificate referred to in Section 7.3(b). The Trustee’s
receipt of such reports, information and documents shall not constitute notice to it of the content
thereof or any matter determinable from the content thereof, including the Company’s compliance
with any of its covenants hereunder, as to which the Trustee is entitled to rely upon Officers’
Certificates.

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ARTICLE VIII

CONSOLIDATION, MERGER, CONVEYANCE, TRANSFER OR LEASE

          Section 8.1 Company May Consolidate, Etc., Only on Certain Terms.

          The Company shall not consolidate with or merge into any other Person or convey, transfer or
lease its properties and assets substantially as an entirety to any Person, and no Person shall
consolidate with or merge into the Company or convey, transfer or lease its properties and assets
substantially as an entirety to the Company, unless:

          (a) if the Company shall consolidate with or merge into another Person or convey, transfer or
lease its properties and assets substantially as an entirety to any Person, the entity formed by
such consolidation or into which the Company is merged or the Person that acquires by conveyance
or transfer, or that leases, the properties and assets of the Company substantially as an entirety
shall be an entity organized and existing under the laws of the United States of America or any
State or Territory thereof or the District of Columbia and shall expressly assume, by an indenture
supplemental hereto, executed and delivered to the Trustee, in form reasonably satisfactory to the
Trustee, the due and punctual payment of the principal of and any premium and interest (including
any Additional Interest) on all the Senior Notes and the performance of every covenant of this
Indenture on the part of the Company to be performed or observed;

          (b) immediately after giving effect to such transaction, no Event of Default, and no event
that, after notice or lapse of time, or both, would constitute an Event of Default, shall have
happened and be continuing; and

          (c) the Company has delivered to the Trustee an Officers’ Certificate and an Opinion of
Counsel, each stating that such consolidation, merger, conveyance, transfer or lease and, if a
supplemental indenture is required in connection with such transaction, any such supplemental
indenture, comply with this Article VIII and that all conditions precedent herein provided
for relating to such transaction have been complied with; and the Trustee may rely upon such
Officers’ Certificate and Opinion of Counsel as conclusive evidence that such transaction complies
with this Section 8.1.

          Section 8.2 Successor Company Substituted.

          (a) Upon any consolidation or merger by the Company with or into any other Person, or any
conveyance, transfer or lease by the Company of its properties and assets substantially as an
entirety to any Person in accordance with Section 8.1 and the execution and delivery to
the Trustee of the supplemental indenture described in Section 8.1 (a), the successor
entity formed by such consolidation or into which the Company is merged or to which such
conveyance, transfer or lease is made shall succeed to, and be substituted for, and may exercise
every right and power of, the Company under this Indenture with the same effect as if such
successor Person had been named as the Company herein; and in the event of any such conveyance or
transfer, following the execution and delivery of such supplemental indenture, the Company shall
be discharged from all obligations and covenants under the Indenture and the Senior Notes.

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          (b) Such successor Person to the Company may cause to be executed, and may issue
either in its own name or in the name of the Company, any or all of the Senior Notes issuable
hereunder that theretofore shall not have been signed by the Company and delivered to the Trustee;
and, upon the order of such successor Person instead of the Company and subject to all the terms,
conditions and limitations in this Indenture prescribed, the Trustee shall authenticate and shall
deliver any Senior Notes that previously shall have been signed and delivered by the officers of
the Company to the Trustee for authentication, and any Senior Notes that such successor Person
thereafter shall cause to be executed and delivered to the Trustee on its behalf. All the Senior
Notes so issued shall in all respects have the same legal rank and benefit under this Indenture as
the Senior Notes theretofore or thereafter issued in accordance with the terms of this Indenture.

          (c) In case of any such consolidation, merger, sale, conveyance or lease, such changes in
phraseology and form may be made in the Senior Notes thereafter to be issued as may be appropriate
to reflect such occurrence.

ARTICLE IX

SUPPLEMENTAL INDENTURES

          Section 9.1 Supplemental Indentures without Consent of Holders.

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

          (a) to evidence the succession of another Person to the Company, and the assumption by any
such successor of the covenants of the Company herein and in the Senior Notes; or

          (b) to evidence and provide for the acceptance of appointment hereunder by a successor
trustee; or

          (c) to cure any ambiguity, to correct or supplement any provision herein that may be
defective or inconsistent with any other provision herein, or to make or amend any other
provisions with respect to matters or questions arising under this Indenture, which shall not be
inconsistent with the other provisions of this Indenture; provided, that such action
pursuant to this clause (c) shall not be effected unless the Company has delivered a written
notice of such amendment to the Holders at least twenty (20) days prior to the effective date of
such amendment; provided, further, that such action pursuant to this clause (c) shall not
adversely affect in any material respect the interests of any Holders; or

          (d) to comply with the rules and regulations of any securities exchange or automated
quotation system on which any of the Senior Notes may be listed, traded or quoted; or

          (e) to add to the covenants, restrictions or obligations of the Company or to add to the
Events of Default; provided, that such action pursuant to this clause (e) shall not
adversely affect in any material respect the interests of any Holders; or

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          (f) to modify, eliminate or add to any provisions of the Indenture or the Senior Notes to
such extent as shall be necessary to ensure that the Senior Notes are treated as indebtedness of
the Company for United States federal income tax purposes; provided, that such action
pursuant to this clause (f) shall not adversely affect in any material respect the interests of any
Holders.

          Section 9.2 Supplemental Indentures with Consent of Holders.

          (a) Subject to Section 9.1, with the consent of the Holders of not less than a
majority in aggregate principal amount of the Outstanding Senior Notes, by Act of said Holders
delivered to the Company and the Trustee, the Company, when authorized by a Board Resolution, and
the Trustee may enter into an indenture or indentures supplemental hereto for the purpose of
adding any provisions to or changing in any manner or eliminating any of the provisions of this
Indenture or of modifying in any manner the rights of the Holders of Senior Notes under this
Indenture; provided, that no such supplemental indenture shall, without the consent of the
Holder of each Outstanding Senior Note:

     (i) except as set forth in Section 3.1(f), change the Stated Maturity of the
principal or any premium of any Senior Note or change the date of payment of any
installment of interest (including any Additional Interest) on any Senior Note, or reduce
the principal amount thereof or the rate of interest thereon or any premium payable upon
the redemption thereof or change the place of payment where, or the coin or currency in
which, any Senior Note or interest thereon is payable, or restrict or impair the right to
institute suit for the enforcement of any such payment on or after such date; or

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

     (iii)
modify any of the provisions of this Section 9.2, Section 5.13 or
Section 10.6, except to increase any percentage in aggregate principal amount of
the Outstanding Senior Notes, the consent of whose Holders is required for any reason, or
to provide that certain other provisions of this Indenture cannot be modified or waived
without the consent of the Holder of each Senior Note.

          (b) It shall not be necessary for any Act of Holders under this Section 9.2 to approve
the particular form of any proposed supplemental indenture, but it shall be sufficient if such Act
shall approve the substance thereof.

          Section 9.3 Execution of Supplemental Indentures.

          In executing or accepting the additional trusts created by any supplemental indenture
permitted by this Article IX or the modifications thereby of the trusts created by this
Indenture, the Trustee shall be entitled to receive, and shall be fully protected in conclusively
relying upon, an Officers’ Certificate and an Opinion of Counsel stating that the execution of
such supplemental indenture is authorized or permitted by this Indenture, and that all conditions
precedent herein provided for relating to such action have been complied with. The Trustee may,

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but shall not be obligated to, enter into any such supplemental indenture that affects the
Trustee’s own rights, duties, indemnities or immunities under this Indenture or otherwise. Copies
of the final form of each supplemental indenture shall be delivered by the Trustee at the expense
of the Company to each Holder promptly after the execution thereof.

          Section 9.4 Effect of Supplemental Indentures.

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

          Section 9.5 Reference in Senior Notes to Supplemental Indentures.

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

ARTICLE
X

 COVENANTS

          Section 10.1 Payment of Principal, Premium, if any, and Interest.

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

          Section 10.2 Money for Senior Note Payments to be Held in Trust.

          (a) If the Company shall at any time act as its own Paying Agent with respect to the Senior
Notes, it will, on or before each due date of the principal of and any premium or interest
(including any Additional Interest) on the Senior Notes, segregate and hold in trust for the
benefit of the Persons entitled thereto a sum sufficient to pay the principal and any premium or
interest (including Additional Interest) so becoming due until such sums shall be paid to such
Persons or otherwise disposed of as herein provided, and will promptly notify the Trustee in
writing of its failure so to act.

          (b) Whenever the Company shall have one or more Paying Agents, it will, prior to 10:00 A.M.,
New York City time, on each due date of the principal of and any premium or interest (including
any Additional Interest) on any Senior Notes, deposit with a Paying Agent a sum sufficient to pay
such amount, such sum to be held as provided in the Trust Indenture Act

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and (unless such Paying Agent is the Trustee) the Company will promptly notify the Trustee of its
failure so to act.

          (c) The Company will cause each Paying Agent for the Senior Notes other than the Trustee to
execute and deliver to the Trustee an instrument in which such Paying Agent shall agree with the
Trustee, subject to the provisions of this Section 10.2, that such Paying Agent will (i)
comply with the provisions of this Indenture and the Trust Indenture Act applicable to it as a
Paying Agent and (ii) during the continuance of any default by the Company (or any other obligor
upon the Senior Notes) in the making of any payment in respect of the Senior Notes, upon the
written request of the Trustee, forthwith pay to the Trustee all sums held in trust by such Paying
Agent for payment in respect of the Senior Notes.

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

          (e) 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 and any premium or interest (including any Additional
Interest) on any Senior Note and remaining unclaimed for two (2) years after such principal and
any premium or interest has become due and payable shall (unless otherwise required by mandatory
provision of applicable escheat or abandoned or unclaimed property law) be paid on Company Request
to the Company, or (if then held by the Company) shall (unless otherwise required by mandatory
provision of applicable escheat or abandoned or unclaimed property law) be discharged from such
trust; and the Holder of such Senior Note shall thereafter, as an unsecured general creditor, 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, shall
thereupon cease; provided, 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 a
newspaper published in the English language, customarily published on each Business Day and of
general circulation in the Borough of Manhattan, The City of New York, notice that such money
remains unclaimed and that, after a date specified therein, which shall not be less than thirty
(30) days from the date of such publication, any unclaimed balance of such money then remaining
will be repaid to the Company.

          Section 10.3 Statement as to Compliance.

          The Company shall deliver to the Trustee, within one hundred twenty (120) days after the end
of each fiscal year of the Company ending after the date hereof, an Officers’ Certificate
(substantially in the form attached hereto as Exhibit B) covering the preceding calendar
year, stating whether or not to the knowledge of the signers thereof the Company is in default in
the performance or observance of any of the terms, provisions and conditions of this Indenture
(without regard to any period of grace or requirement of notice provided hereunder), and if the

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Company shall be in default, specifying all such defaults and the nature and status thereof of
which they may have knowledge.

          Section 10.4 Calculation Agent.

          (a) The Company hereby agrees that for so long as any of the Senior Notes remain Outstanding,
there will at all times be an agent appointed to calculate LIBOR in respect of each Interest
Payment Date in accordance with the terms of Schedule A
(the “Calculation Agent”). The
Company has initially appointed the Trustee as Calculation Agent for purposes of determining LIBOR
for each Interest Payment Date. Notwithstanding the foregoing, so long as the Senior Notes are
Outstanding, the Calculation Agent shall be the Trustee. If the Calculation Agent is unable or
unwilling to act as such or is removed by the Company, the Company will promptly appoint as a
replacement Calculation Agent the London office of a leading bank which is engaged in transactions
in three (3)-month Eurodollar deposits in the international Eurodollar market and which does not
control or is not controlled by or under common control with the Company or its Affiliates. The
Calculation Agent may not resign its duties without a successor having been duly appointed.

          (b) The Calculation Agent shall be required to agree that, as soon as possible after 11:00
A.M. (London time) on each LIBOR Determination Date (as defined in Schedule A), but in no
event later than 11:00 A.M. (London time) on the Business Day immediately following each LIBOR
Determination Date, the Calculation Agent will calculate the interest rate (the interest payment
shall be rounded to the nearest cent, with half a cent being rounded upwards) for the related
Interest Payment Date, and will communicate such rate and amount to the Company, the Trustee, each
Paying Agent and the Depositary. The Calculation Agent will also specify to the Company the
quotations upon which the foregoing rates and amounts are based and, in any event, the Calculation
Agent shall notify the Company before 5:00 P.M. (London time) on each LIBOR Determination Date
that either: (i) it has determined or is in the process of determining the foregoing rates and
amounts or (ii) it has not determined and is not in the process of determining the foregoing rates
and amounts, together with its reasons therefor. The Calculation Agent’s determination of the
foregoing rates and amounts for any Interest Payment Date will (in the absence of manifest error)
be final and binding upon all parties. For the sole purpose of calculating the interest rate for
the Senior Notes, “Business Day” shall be defined as any day on which dealings in deposits in
Dollars are transacted in the London interbank market.

          Section 10.5 Additional Covenants.

          (a) The Company covenants and agrees with each Holder of Senior Notes that if an Event of
Default shall have occurred and be continuing, it shall not (i) declare or pay any dividends or
distributions on, or redeem, purchase, acquire or make a liquidation payment with respect to, any
Equity Interests of the Company, (ii) vote in favor of or permit or otherwise allow any of its
Subsidiaries to declare or pay any dividends or distributions on, or redeem, purchase, acquire or
make a liquidation payment with respect to or otherwise retire, any preferred Equity Interests of
such Subsidiaries or other Equity Interests entitling the holders thereof to a stated rate of
return (for the avoidance of doubt, whether such preferred Equity Interests are perpetual or
otherwise), or (iii) make any payment of principal of or any interest or premium, if any, on or
repay, repurchase or redeem any Debt of the Company other than Permitted Debt (other than (A)

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repurchases, redemptions or other acquisitions of Equity Interests of the Company in connection
with any employment contract, benefit plan or other similar arrangement with or for the benefit of
any one or more employees, officers, directors or consultants, in connection with a dividend
reinvestment or Equity Interests purchase plan or in connection with the issuance of Equity
Interests in the Company (or securities convertible into or exercisable for such Equity Interests)
as consideration in an acquisition transaction entered into prior to the applicable Event of
Default, (B) as a result of an exchange, conversion reclassification or combination of any class or
series of the Company’s Equity Interests (or any Equity Interests in a Subsidiary of the Company)
for any class or series of the Company’s Equity Interests or of any class or series of the
Company’s indebtedness for any class or series of the Company’s Equity Interests, (C) the purchase
of fractional interests in the Equity Interests of the Company pursuant to the conversion or
exchange provisions of such Equity Interests or the security being converted or exchanged, (D) any
declaration of a dividend in connection with any Rights Plan, the issuance of rights, Equity
Interests or other property under any Rights Plan or the redemption or repurchase of rights
pursuant thereto or (E) any dividend in the form of Equity Interests, warrants, options or other
rights where the dividend Equity Interest or the Equity Interest issuable upon exercise of such
warrants, options or other rights is the same Equity Interest as that on which the dividend is
being paid or ranks pari passu with or junior to such Equity Interest).

          (b) The Company shall notify in writing, within five (5) Business Days of the occurrence
thereof, the Trustee and each Holder of Senior Notes of the occurrence of a Change-of-Control
(the “Change-of-Control Notice”). Within thirty (30) days of the occurrence of a
Change-of-Control, the Depositor shall initiate a ratings affirmation process with the Ratings
Agencies to determine if a Ratings Downgrade has occurred as a result of such Change-of- Control.
Within five (5) Business Days of the completions of such ratings affirmation process, the Company
shall notify in writing the Trustee and each holder of Senior Notes of the occurrence of a
Change-of-Control Event (the “Change-of-Control Event Notice”). If the Company shall have
received, within thirty (30) days from the Holders of Senior Notes’ receipt of the
Change-of-Control Event Notice, written notice from any Holder of Senior Notes of such Holder’s
election to cause the Defeasance or redemption, as applicable, of the Senior Notes as provided in
this Section 10.5(b) (the “Change-of-Control Election”), then the Company shall (i)
if such Change-of-Control Election is received on or prior to June 30, 2011, cause Article
XIII to be applied to the Outstanding Senior Notes or (ii) if such Change-of-Control Election
is received after June 30, 2011, redeem the Senior Notes
pursuant to Section 11.1(b).

          (c) The Company hereby covenants and agrees that the Company shall maintain, (i) as of the
end of each fiscal quarter during 2007, a Consolidated Tangible Net Worth (as reported in the
Company’s balance sheet contained in the most recent periodic report filed with the Commission) in
excess of $110,000,000 and (ii) as of the end of each fiscal quarter thereafter commencing with
the Company’s first fiscal quarter during 2008, a Consolidated Tangible Net Worth (as reported in
the Company’s balance sheet contained in the most recent periodic report filed with the
Commission) in excess of $120,000,000.

          (d) The Company will not permit the Leverage Ratio, as of the end of each fiscal quarter, to
be greater than 3.00 to 1.00.

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          (e) The Company will not permit the Fixed Charge Coverage Ratio, (i) as of the end of each
fiscal quarter ending March 31, 2007 and June 30, 2007, to be less than 1.0 to 1.00 in each case
for such quarter or, collectively, such quarter together with the preceding three (3) quarters,
(ii) as of the end of the fiscal quarter ending September 30, 2007 to be less than 1.50 to 1.00
for such quarter or, collectively, such quarter together with the preceding three (3) quarters,
(iii) as of the end of December 31, 2007 to be less than 2.0 to 1.00 for such quarter or,
collectively, such quarter together with the preceding three (3) quarters and (iv) each fiscal
quarter thereafter, to be less than 2.00 to 1.00 for, collectively, such quarter together with the
preceding three (3) quarters.

          (f) On each of March 30, 2007, June 30, 2007 and either, at the Company’s option, September
30, 2007 or December 30, 2007, the Company shall deposit into the Interest Reserve Account an
amount equal to the amount of interest paid with respect to the Senior Notes on such Interest
Payment Date pursuant to Section 3.1 (a). The amounts on deposit in the Interest Reserve
Account shall not be released to the Company until such time as the Company shall (i) have
maintained a Fixed Charge Coverage Ratio of not less than 2.0 to 1.0 as of the four (4)
immediately preceding fiscal quarters in each case for, collectively, such quarter together with
the preceding three (3) quarters and (ii) be in compliance with all other covenants contained
herein.

          (g) Until such time as the Company shall (x) have maintained a Fixed Charge Coverage Ratio of
not less than 2.0 to 1.0 as of the two (2) immediately preceding fiscal quarters, in each case,
for, collectively, such quarter together with the preceding three (3) quarters and (y) be in
compliance with all other covenants contained herein, the Company shall not repurchase any Equity
Interests of the Company unless in connection with such repurchase of Equity Interests (an
“Acceptable Repurchase”) (i) the Company will
redeem pursuant to Section 11.1 (d) an amount
of Senior Notes having an outstanding principal amount equal to the purchase price of such Equity
Interests to be repurchased up to a maximum of $10,000,000, (ii) the redemption and defeasance of
such Senior Notes shall be in increments of $1,000,000 and (iii) the redemption and defeasance, if
any, of such Senior Notes shall be consummated and all payments or deposits made with respect
thereto shall be made prior to the consummation of the repurchase of any Equity Interests.

          Section 10.6 Waiver of Covenants.

          The Company may omit in any particular instance to comply with any covenant or condition
contained in Section 10.5 if, before or after the time for such compliance, the Holders of
at least a majority in aggregate principal amount of the Outstanding Senior Notes shall, by Act of
such Holders, either waive such compliance in such instance or generally waive compliance with
such covenant or condition, but no such waiver shall extend to or affect such covenant or
condition except to the extent so expressly waived, and, until such waiver shall become effective,
the obligations of the Company in respect of any such covenant or condition shall remain in full
force and effect.

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          Section 10.7 Treatment of Senior Notes.

          The Company will treat the Senior Notes as indebtedness, and the amounts, other than payments
of principal, payable in respect of the principal amount of such Senior Notes as interest, for all
U.S. federal income tax purposes. All payments in respect of the Senior Notes will be made free
and clear of U.S. withholding tax to any beneficial owner thereof that has provided an Internal
Revenue Service Form W-9 or

 W-8BEN (or any substitute or successor form) establishing its U.S. or
non-U.S. status for U.S. federal income tax purposes, or any other applicable form establishing a
complete exemption from U.S. withholding tax.

          Section 10.8 Limitation on Issuance of Debt.

          The Company hereby agrees not to, without the prior written consent of Holders of a majority
of outstanding principal amount of the Senior Notes, offer, sell, contract to sell, grant any
option to purchase or otherwise dispose of, directly or indirectly, any other Debt unless (i) the
Company shall be in compliance with each of the covenants contained herein after taking into
account such offer, sale, contract to sell, grant, purchase or other disposition, (ii) such Debt
is Permitted Debt or (iii) such Debt (A) shall be expressly subordinate by its terms to the Senior
Notes and (B) shall not contain any covenants of the Company which are more restrictive than the
covenants contained in this Indenture.

ARTICLE XI

REDEMPTION OF SENIOR NOTES

          Section 11.1 Optional Redemption
and Mandatory Redemptions.

          (a) The Company may, at its option, (i) on any Interest Payment Date on or after June 30,
2011, (ii) upon receipt of thirty (30) days prior written notice from the Purchaser of Purchaser’s
intent to consummate a sale, assignment or transfer of the Senior Notes to a subsequent purchaser
(including to any entity issuing or proposing to issue collateralized debt obligations) other than
an Affiliate of the Purchaser or (iii) to the extent the Purchaser has not consummated one of the
transactions in subsection (ii) hereof, redeem such Senior Notes in whole at any time or, subject
to the consent of the Purchaser (or any Affiliate transferee thereof), in part from time to time,
in each case at a Redemption Price equal to one hundred percent (100%) of the principal amount
thereof (or of the redeemed portion thereof, as applicable), together, in the case of any such
redemption, with accrued and unpaid interest, including any Additional Interest, to but excluding
the date fixed as the Redemption Date and plus all Breakage Costs
(the “Optional Redemption Price”). In the event of a redemption pursuant to (ii) of this Section 11.1 (a), the redemption
will not be required to occur on an Interest Payment Date.

          (b) The Company shall, upon receipt of a Change-of-Control Election after June 30 2011,
redeem the Senior Notes in whole on a date no more than thirty (30) days after receipt of the
Change-of-Control Election, at a Redemption Price equal to one hundred percent (100%) of the
outstanding principal amount thereof, together, in the case of any such redemption, with accrued
and unpaid interest, including any Additional Interest, to but excluding the date fixed as the
Redemption Date (the “Change of Control Mandatory Redemption Price”).

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          (c) The Company shall, in the event it receives a Put Election Notice, redeem the portion of
the Senior Notes the Purchaser elects to require the Company to redeem pursuant to such Put
Election Notice, at a Redemption Price equal to one hundred percent (100%) of the principal amount
of the redeemed portion of the Senior Notes, together with, in the case of any such redemption,
any accrued and unpaid interest, including any Additional Interest, to but excluding the date
fixed as the Redemption Date and plus all Breakage Costs (the “Put Mandatory Redemption
Price”).

          (d) The Company shall, in connection with an Acceptable Repurchase, redeem the portion of
Senior Notes required to be redeemed pursuant to Section 10.5(g), at a Redemption Price
equal to one hundred percent (100%) of the principal amount of the redeemed portion of the
Securities, together with, in the case of any such redemption, any accrued and unpaid interest,
including any Additional Interest, to but excluding the date fixed as the Redemption Date and plus
all Breakage Costs (the “Acceptable Repurchase Mandatory Redemption Price”).

          Section 11.2 Special Event Redemption.

          Prior to June 30, 2011, upon the occurrence and during the continuation of a Special Event,
the Company may, at its option, redeem the Senior Notes, in whole but not in part, at a Redemption
Price equal to one hundred seven and one-half percent (107.5%) of the principal amount thereof,
together, in the case of any such redemption, with accrued and unpaid interest, including any
Additional Interest, to but excluding the date fixed as the Redemption Date (the “Special
Redemption Price”).

          Section 11.3
Election to Redeem; Notice to Trustee.

          The election of the Company to redeem any Senior Notes, in whole or in part, shall be
evidenced by or pursuant to a Board Resolution. With the exception of any redemption pursuant to
Section 11.1(a)(ii), in case of any redemption at the election of the Company, the Company shall,
not less than forty-five (45) days and not more than seventy-five (75) days prior to the
Redemption Date (unless a shorter notice shall be satisfactory to the Trustee), notify the Trustee
in writing of such date and of the principal amount of the Senior Notes to be redeemed and provide
the additional information required to be included in the notice or notices contemplated by
Section 11.5. In the event of a redemption pursuant to
Section 11.1(a)(ii) above, the
applicable Trustee notice period shall be not less than ten (10) days nor more than twenty (20)
days. In the case of any redemption of Senior Notes, in whole or in part, (a) prior to the
expiration of any restriction on such redemption provided in this Indenture or the Senior Notes or
(b) pursuant to an election of the Company which is subject to a condition specified in this
Indenture or the Senior Notes, the Company shall furnish the Trustee with an Officers’ Certificate
and an Opinion of Counsel evidencing compliance with such restriction or condition.

          Section 11.4 Selection of Senior Notes to be Redeemed.

          (a) If less than all the Senior Notes are to be redeemed, the particular Senior Notes to be
redeemed shall be selected and redeemed on a pro rata basis not more than sixty (60) days prior to
the Redemption Date by the Trustee from the Outstanding Senior Notes not previously called for
redemption; provided, that the unredeemed portion of the principal amount of any

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Senior Note shall be in an authorized denomination (which shall not be less than the minimum
authorized denomination) for such Senior Note.

          (b) The Trustee shall promptly notify the Company in writing of the Senior Notes selected for
redemption and, in the case of any Senior Notes selected for partial redemption, the principal
amount thereof to be redeemed. For all purposes of this Indenture, unless the context otherwise
requires, all provisions relating to the redemption of Senior Notes shall relate, in the case of
any Senior Note redeemed or to be redeemed only in part, to the portion of the principal amount of
such Senior Note that has been or is to be redeemed.

          (c) The provisions of paragraphs (a) and (b) of this Section 11.4 shall not apply with
respect to any redemption affecting only a single Senior Note, whether such Senior Note is to be
redeemed in whole or in part. In the case of any such redemption in part, the unredeemed portion
of the principal amount of the Senior Note shall be in an authorized denomination (which shall not
be less than the minimum authorized denomination) for such Senior Note.

          Section 11.5 Notice of Redemption.

          (a) With
the exception of any redemption pursuant to Section 11.1(a)(ii), notice of
redemption shall be given not later than the thirtieth (30th) day, and not earlier than the
sixtieth (60th) day, prior to the Redemption Date to each Holder of Senior Notes to be redeemed,
in whole or in part. In the event of a redemption pursuant to Section
11.1(a)(ii) above, the
applicable Holder notice period shall be not less than five (5) days nor more than ten (10) days.

          (b) With respect to Senior Notes to be redeemed, in whole or in part, each notice of
redemption shall state:

     (i) the Redemption Date;

     (ii) the Redemption Price or, if the Redemption Price cannot be calculated prior to
the time the notice is required to be sent, the estimate of the Redemption Price, as
calculated by the Company, together with a statement that it is an estimate and that the
actual Redemption Price will be calculated on the fifth Business Day prior to the
Redemption Date (and if an estimate is provided, a further notice shall be sent of the
actual Redemption Price on the date that such Redemption Price is calculated);

     (iii) if less than all Outstanding Senior Notes are to be redeemed, the identification
(and, in the case of partial redemption, the respective principal amounts) of the amount of
and particular Senior Notes to be redeemed;

     (iv) that on the Redemption Date, the Redemption Price will become due and payable
upon each such Senior Note or portion thereof, and that any interest (including any
Additional Interest) on such Senior Note or such portion, as the case may be, shall cease
to accrue on and after said date; and

     (v) the place or places where such Senior Notes are to be surrendered for payment of
the Redemption Price.

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          (c) Notice of redemption of Senior Notes to be redeemed, in whole or in part, at the election
of the Company shall be given by the Company or, at the Company’s written request, by the Trustee
in the name and at the expense of the Company and shall be irrevocable. The notice if mailed in
the manner provided above shall be conclusively presumed to have been duly given, whether or not
the Holder receives such notice. In any case, a failure to give such notice by mail or any defect
in the notice to the Holder of any Senior Note designated for redemption as a whole or in part
shall not affect the validity of the proceedings for the redemption of any other Senior Note.

          Section 11.6 Deposit of Redemption Price.

          Prior to 10:00 A.M., New York City time, on the Redemption Date specified in the notice of
redemption given as provided in Section 11.5, the Company will deposit with the Trustee or
with one or more Paying Agents (or if the Company is acting as its own Paying Agent, the Company
will segregate and hold in trust as provided in Section 10.2) an amount of money
sufficient to pay the Redemption Price of, and any accrued interest (including any Additional
Interest) on, all the Senior Notes (or portions thereof) that are to be redeemed on that date.

          Section 11.7 Payment of Senior Notes Called for Redemption.

          (a) If any notice of redemption has been given as provided in Section 11.5, the Senior
Notes or portion of Senior Notes with respect to which such notice has been given shall become
due and payable on the date and at the place or places stated in such notice at the applicable
Redemption Price. On presentation and surrender of such Senior Notes at a Place of Payment
specified in such notice, the Senior Notes or the specified portions thereof shall be paid and
redeemed by the Company at the applicable Redemption Price.

          (b) Upon presentation of any Senior Note redeemed in part only, the Company shall execute and
the Trustee shall authenticate and deliver to the Holder thereof, at the expense of the Company, a
new Senior Note or Senior Notes, of authorized denominations, in aggregate principal amount equal
to the unredeemed portion of the Senior Note so presented and having the same Original Issue Date,
Stated Maturity and terms.

          (c) If any Senior Note called for redemption shall not be so paid upon surrender thereof for
redemption, the principal of and any premium on such Senior Note shall, until paid, bear interest
from and including the Redemption Date at the rate prescribed therefor in the Senior Note.

ARTICLE XII

SUBORDINATION OF SECURITIES

          Section 12.1 Senior Notes
Subordinate to Permitted Debt.

          The Company covenants and agrees, and each Holder of a Senior Note, by its acceptance thereof,
likewise covenants and agrees, that, to the extent and in the manner hereinafter set forth in this
Article XII, the payment of the principal of and any premium and interest (including any
Additional Interest) on each and all of the Senior Notes is hereby expressly made subordinate

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and subject in right of payment to the prior payment in full of all Permitted Debt, other than to
the extent of amounts subject to the lien of the Control Agreement.

          Section 12.2 No Payment When Permitted Debt in Default; Payment Over of Proceeds Upon
Dissolution, Etc.

          (a) In the event of a bankruptcy, insolvency or other proceeding described in clause (d) or
(e) of the definition of Event of Default specified in Section 5.1 (each such event, if
any, herein sometimes referred to as a “Proceeding”), all Permitted Debt (including any interest
thereon accruing after the commencement of any such proceedings) shall first be paid in full
before any payment or distribution, whether in cash, securities or other property, shall be made to
any Holder of any of the Senior Notes on account thereof, other than payments made pursuant to
the terms of the Control Agreement. Any payment or distribution, whether in cash, securities or
other property (other than securities of the Company or any other entity provided for by a plan of
reorganization or readjustment the payment of which is subordinate, at least to the extent
provided in these subordination provisions with respect to the indebtedness evidenced by the
Senior Notes, to the payment of all Permitted Debt at the time outstanding and to any securities
issued in respect thereof under any such plan of reorganization or readjustment), which would
otherwise (but for these subordination provisions and in no event including amounts subject to the
lien of the Control Agreement) be payable or deliverable in respect of the Senior Notes shall be
paid or delivered directly to the holders of Permitted Debt in accordance with the priorities then
existing among such holders until all Permitted Debt (including any interest thereon accruing
after the commencement of any Proceeding) shall have been paid in full.

          (b) In the event of any Proceeding, after payment in full of all sums owing with respect to
Permitted Debt, the Holders of the Senior Notes, together with the holders of any obligations of
the Company ranking on a parity with the Senior Notes, shall be entitled to be paid from the
remaining assets of the Company the amounts at the time due and owing on account of unpaid
principal of and any premium and interest (including any Additional Interest) on the Senior Notes
and such other obligations before any payment or other distribution, whether in cash, property or
otherwise, shall be made on account of any Equity Interests or any obligations of the Company
ranking junior to the Senior Notes and such other obligations. If, notwithstanding the foregoing,
any payment or distribution of any character on any security, whether in cash, securities or other
property (other than securities of the Company or any other entity provided for by a plan of
reorganization or readjustment the payment of which is subordinate, at least to the extent
provided in these subordination provisions with respect to the indebtedness evidenced by the
Senior Notes, to the payment of all Permitted Debt at the time outstanding and to any securities
issued in respect thereof under any such plan of reorganization or readjustment) shall be received
by the Trustee or any Holder in contravention of any of the terms hereof and before all Permitted
Debt shall have been paid in full (other than with respect to amounts subject to the lien of the
Control Agreement and paid pursuant to the terms thereof), such payment or distribution or
security shall be received in trust for the benefit of, and shall be paid over or delivered and
transferred to, the holders of the Permitted Debt at the time outstanding in accordance with the
priorities then existing among such holders for application to the payment of all Permitted Debt
remaining unpaid, to the extent necessary to pay all such Permitted Debt (including any interest
thereon accruing after the commencement of any Proceeding) in full. In the event of the failure of
the Trustee or any Holder to endorse or assign

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any such payment, distribution or security, each holder of Permitted Debt is hereby irrevocably
authorized to endorse or assign the same.

          (c) The Trustee and the Holders, at the expense of the Company, shall take such reasonable
action (including the delivery of this Indenture to an agent for any holders of Permitted Debt or
consent to the filing of a financing statement with respect hereto) as may, in the opinion of
counsel designated by the holders of a majority in principal amount of the Permitted Debt at the
time outstanding, be necessary or appropriate to assure the effectiveness of the subordination
effected by these provisions.

          (d) The provisions of this Section 12.2 shall not impair any rights, interests,
remedies or powers of any secured creditor of the Company in respect of any security interest the
creation of which is not prohibited by the provisions of this Indenture, including the rights,
interests, remedies or powers of the Trustee or the Holders of the Senior Notes with respect to
the amounts subject to the lien of the Control Agreement.

          (e) The securing of any obligations of the Company, otherwise ranking on a parity with the
Senior Notes or ranking junior to the Senior Notes, shall not be deemed to prevent such
obligations from constituting, respectively, obligations ranking on a parity with the Senior Notes
or ranking junior to the Senior Notes.

          Section 12.3 Payment Permitted if No Proceeding.

          Nothing contained in this Article XII or elsewhere in this Indenture or in any of the
Senior Notes shall prevent (a) the Company, at any time, except during the pendency of any
Proceeding referred to in Section 12.2, from making payments at any time of principal of,
premium, if any, or interest (including any Additional Interest) on the Senior Notes or (b) the
application by the Trustee of any moneys deposited with it hereunder to the payment of or on
account of the principal of, premium, if any, or interest (including any Additional Interest) on
the Senior Notes or the retention of such payment by the Holders, if, at the time of such
application by the Trustee, it did not have knowledge (in accordance with Section 12.8)
that such payment would have been prohibited by the provisions of this Article XII, except
as provided in Section 12.8.

          Section 12.4 Subrogation to Rights of Holders of Permitted Debt.

          Subject to the payment in full of all amounts due or to become due on all Permitted Debt, or
the provision for such payment in cash or cash equivalents or otherwise in a manner satisfactory
to the holders of Permitted Debt, the Holders of the Senior Notes shall be subrogated to the
extent of the payments or distributions made to the holders of such Permitted Debt pursuant to the
provisions of this Article XII (equally and ratably with the holders of all indebtedness
of the Company that by its express terms is subordinated to Permitted Debt of the Company to
substantially the same extent as the Senior Notes are subordinated to the Permitted Debt and is
entitled to like rights of subrogation by reason of any payments or distributions made to holders
of such Permitted Debt) to the rights of the holders of such Permitted Debt to receive payments
and distributions of cash, property and securities applicable to the Permitted Debt until the
principal of and any premium and interest (including any Additional Interest) on the Senior

65

 

Notes shall be paid in full. For purposes of such subrogation, no payments or distributions to the
holders of the Permitted Debt of any cash, property or securities to which the Holders of the
Senior Notes or the Trustee would be entitled except for the provisions of this Article
XII, and no payments made pursuant to the provisions of this Article XII to the
holders of Permitted Debt by Holders of the Senior Notes or the Trustee, shall, as among the
Company, its creditors other than holders of Permitted Debt, and the Holders of the Senior Notes,
be deemed to be a payment or distribution by the Company to or on account of the Permitted Debt.

          Section 12.5 Provisions Solely to Define Relative Rights.

          The provisions of this Article XII are and are intended solely for the purpose of
defining the relative rights of the Holders of the Senior Notes on the one hand and the holders of
Permitted Debt on the other hand. Nothing contained in this Article XII or elsewhere in
this Indenture or in the Senior Notes is intended to or shall (a) impair, as between the Company
and the Holders of the Senior Notes, the obligations of the Company, which are absolute and
unconditional, to pay to the Holders of the Senior Notes the principal of and any premium and
interest (including any Additional Interest) on the Senior Notes as and when the same shall become
due and payable in accordance with their terms, (b) affect the relative rights against the Company
of the Holders of the Senior Notes and creditors of the Company other than their rights in relation
to the holders of Permitted Debt or (c) prevent the Trustee or any Holder from exercising all
remedies otherwise permitted by applicable law upon default under this Indenture, including filing
and voting claims in any Proceeding, subject to the rights, if any, under this Article XII
of the holders of Permitted Debt to receive cash, property and securities otherwise payable or
deliverable to the Trustee or such Holder.

          Section 12.6 Trustee to Effectuate Subordination.

          Each Holder of a Senior Note by his, her or its acceptance thereof authorizes and directs the
Trustee on his, her or its behalf to take such action as may be necessary or appropriate to
acknowledge or effectuate the subordination provided in this Article XII and appoints the
Trustee his, her or its attorney-in-fact for any and all such purposes.

          Section 12.7 No Waiver of Subordination Provisions.

          (a) No right of any present or future holder of any Permitted 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 noncompliance by the Company with the terms, provisions and covenants of this Indenture,
regardless of any knowledge thereof that any such holder may have or be otherwise charged with.

          (b) Without in any way limiting the generality of paragraph (a) of this Section 12.7,
the holders of Permitted Debt may, at any time and from to time, without the consent of or
notice to the Trustee or the Holders of the Senior Notes, without incurring responsibility to such
Holders of the Senior Notes and without impairing or releasing the subordination provided in this
Article XII or the obligations hereunder of such Holders of the Senior Notes to the holders
of Permitted Debt, do any one or more of the following, so long as such Permitted Debt shall

66

 

remain Permitted Debt thereafter: (i) change the manner, place or terms of payment or extend the
time of payment of, or renew or alter, Permitted Debt, or otherwise amend or supplement in any
manner Permitted Debt or any instrument evidencing the same or any agreement under which Permitted
Debt is outstanding, (ii) sell, exchange, release or otherwise deal with any property pledged,
mortgaged or otherwise securing Permitted Debt, (iii) release any Person liable in any manner for
the payment of Permitted Debt and (iv) exercise or refrain from exercising any rights against the
Company and any other Person.

          Section 12.8 Notice to Trustee.

          The Company shall give prompt written notice to a Responsible Officer of the Trustee of any
fact known to the Company that would prohibit the making of any payment to or by the Trustee in
respect of the Senior Notes. Notwithstanding the provisions of this Article XII or any
other provision of this Indenture, the Trustee shall not be charged with knowledge of the existence
of any facts that would prohibit the making of any payment to or by the Trustee in respect of the
Senior Notes, unless and until a Responsible Officer of the Trustee shall have received written
notice thereof from the Company or a holder of Permitted Debt or from any trustee, agent or
representative therefor; provided, that if the Trustee shall not have received the notice
provided for in this Section 12.8 at least two Business Days prior to the date upon which
by the terms hereof any monies may become payable for any purpose (including, the payment of the
principal of and any premium on or interest (including any Additional Interest) on any Senior
Note), then, anything herein contained to the contrary notwithstanding, the Trustee shall have full
power and authority to receive such monies and to apply the same to the purpose for which they were
received and shall not be affected by any notice to the contrary that may be received by it within
two Business Days prior to such date.

          The Trustee shall be entitled to rely on the delivery to it of a written notice by a Person
representing himself, herself or itself to be a holder of Permitted Debt (or a trustee, agent,
representative or attorney-in-fact therefor) to establish that such notice has been given by a
holder of Permitted Debt (or a trustee, agent, representative or attorney-in-fact therefor). 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 Permitted Debt to participate in any payment or
distribution pursuant to this Article XII, the Trustee may request such Person to furnish
evidence to the reasonable satisfaction of the Trustee as to the amount of Permitted 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
XII, 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 12.9 Reliance on Judicial Order or Certificate of Liquidating Agent.

          Upon any payment or distribution of assets of the Company referred to in this Article
XII. the Trustee and the Holders of the Senior Notes shall be entitled to conclusively rely
upon any order or decree entered by any court of competent jurisdiction in which such 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 of Senior Notes, for the purpose of
ascertaining the

67

 

Persons entitled to participate in such payment or distribution, the holders of the Permitted 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
XII.

          Section 12.10 Trustee Not Fiduciary for Holders of Permitted Debt.

          The Trustee, in its capacity as trustee under this Indenture, shall not be deemed to owe
any fiduciary duty to the holders of Permitted Debt and shall not be liable to any such holders if
it shall in good faith mistakenly pay over or distribute to Holders of Senior Notes or to the
Company or to any other Person cash, property or securities to which any holders of Permitted Debt
shall be entitled by virtue of this Article XII or otherwise.

          Section 12.11 Rights of Trustee as Holder of Permitted Debt: Preservation of Trustee’ s
Rights.

          The Trustee in its individual capacity shall be entitled to all the rights set forth in this
Article XII with respect to any Permitted Debt that may at any time be held by it, to the
same extent as any other holder of Permitted Debt, and nothing in this Indenture shall deprive the
Trustee of any of its rights as such holder.

          Section 12.12
Article Applicable to Paying Agents.

          If 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 XII 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 XII in addition to or in place of the Trustee;
provided, that Sections 12.8 and 12.11 shall not apply to the Company or
any Affiliate of the Company if the Company or such Affiliate acts as Paying Agent.

ARTICLE XIII

DEFEASANCE

          Section 13.1 Defeasance
and Discharge.

          In the event of the exercise of the option provided in Section 10.5(b) by a Holder of
the Senior Notes as a result of the receipt of a Change-of-Control Election on or prior to June
30, 2011, and the result that this Section 13.1 shall be applied to the Outstanding Senior
Notes (the “Defeasance Senior Notes”), the Company shall, within thirty (30) days following its
receipt of the Change-of-Control Election, satisfy the conditions set forth in Section
13.2. The Company shall be deemed to have been discharged from its obligations with respect to
the Defeasance Senior Notes as provided in this Section 13.1 on and after the date the
conditions set forth in the Section 13.2 are satisfied (hereinafter called “Defeasance”).
For this purpose, such Defeasance means that the Company shall be deemed to have paid and
discharged the entire indebtedness represented by the Defeasance Senior Notes and to have
satisfied all of its other obligations under the Defeasance Senior Notes and this Indenture
insofar as the Defeasance Senior Notes are concerned (and the Trustee, upon written request and at
the expense of the

68

 

Company, shall execute proper instruments acknowledging the same), subject to the following, which
shall survive until otherwise terminated or discharged hereunder (1) the rights of Holders of the
Defeasance Senior Notes to receive, solely from the trust fund described in Section 13.2
and as more fully set forth in such Section 13.2, payments in respect of the principal
of, premium, if any, and interest on the Defeasance Senior Notes when payments are due, (2) the
Company’s obligations with respect to the Defeasance Senior
Notes under Sections 2.4, 3.5,
3.6, and 10.2, (3) the rights, powers, trusts, duties and immunities of the Trustee
hereunder and (4) this Article XIII.

          Section 13.2 Conditions to Defeasance.

                 The following shall be the conditions to application of Section 13.1 to the Defeasance
Senior Notes:

               (1) The Company shall irrevocably have deposited or caused to be deposited with the
Trustee (or another trustee that satisfies the requirements contemplated by Section
6.1 and agree to comply with the provisions of this Article XIII applicable to
it) as trust funds in trust for the purpose of making the following payments, specifically
pledged as security for, and dedicated solely to, the benefit of the Holders of Defeasance
Senior Notes, (A) money in an amount in Dollars, (B) Government Obligations that through
the scheduled payment of principal and interest in respect thereof in accordance with their
terms will provide, not later than one day before the due date of any payment, money in an
amount in Dollars, or (C) a combination thereof, in each case sufficient, in the opinion of
a nationally recognized firm of independent public accountants expressed in a written
certification thereof delivered to the Trustee, to pay and discharge, and which shall be
applied by the Trustee (or any such other qualifying Trustee) to pay and discharge, one
hundred percent (100%) of the principal amount of the Defeasance Senior Notes on June 30,
2011 (the “Defeasance Maturity Date”) plus interest on the Defeasance Senior Notes
due and payable on the Interest Payment Dates occurring prior to and including the
Defeasance Maturity Date and Breakage Costs, if any, less Breakage Gains, if any, in
accordance with the terms of this Indenture and the Defeasance Senior Notes.

               (2) Such Defeasance shall not cause the Trustee to have a conflicting interest within
the meaning of the Trust Indenture Act.

               (3) Such Defeasance shall not result in the trust arising from such deposit
constituting an “investment company” within the meaning of the Investment Company Act of
1940, unless such trust shall be qualified or exempt from regulation thereunder.

               (4) The Company shall have delivered to the Trustee an Officers’ Certificate and an
Opinion of Counsel, each stating that all conditions precedent with respect to such
Defeasance have been complied with.

69

 

          Section 13.3 Deposited Money and U.S. Government Obligations to be Held in Trust; Other
Miscellaneous Provisions.

               Subject to the provisions of Section 10.2(e), all money and Government Obligations
(including the proceeds thereof) deposited with the Trustee or other qualifying trustee (solely
for purposes of this Section 13.3 and Section 13.4, the Trustee and any such other
trustee are referred to collectively as the “Trustee”) pursuant to Section 13.2 in respect
of the Defeasance Senior Notes shall be held in trust and applied by the Trustee, in accordance
with the provisions of the Defeasance Senior Notes and this Indenture, to the payment, either
directly or through any such Paying Agent (including the Company acting as its own Paying Agent)
as the Trustee may determine, to the Holders of the Defeasance Senior Notes, of all sums due and
to become due thereon in respect of principal, premium, if any, and interest, but money so held in
trust need not be segregated from other funds except to the extent required by law.

               The Company shall pay and indemnify the Trustee against any tax, fee or other charge imposed
on or assessed against the Government Obligations deposited pursuant to Section 13.2 or
the principal and interest received in respect thereof other than any such tax, fee or other
charge that by law is for the account of the Holders of Defeasance Senior Notes.

               Anything in this Article XIII to the contrary notwithstanding, the Trustee shall
deliver or pay to the Company from time to time upon Company Request any money or Government
Obligations held by it as provided in Section 13.2 with respect to the Defeasance Senior
Notes that, in the opinion of a nationally recognized firm of independent public accountants
expressed in a written certification thereof delivered to the Trustee, are in excess of the amount
thereof that would then be required to be deposited to effect an equivalent Defeasance with respect
to the Defeasance Senior Notes.

          Section 13.4 Reinstatement.

               If the Trustee or the Paying Agent is unable to apply any money in accordance with this
Article XIII with respect to the Defeasance Senior Notes by reason of any order or
judgment of any court or governmental authority enjoining, restraining or otherwise prohibiting
such application, then the Company’s obligations under this Indenture and the Defeasance Senior
Notes shall be revived and reinstated as though no deposit had occurred pursuant to this
Article XIII with respect to the Defeasance Senior Notes until such time as the Trustee or
Paying Agent is permitted to apply all money held in trust pursuant to Section 13.3 with
respect to the Defeasance Senior Notes in accordance with this Article XIII; provided,
however, that if the Company makes any payment of principal of, premium, if any, or interest on
any Defeasance Senior Note following the reinstatement of its obligations, the Company shall be
subrogated to the rights of the Holders of Defeasance Senior Notes to receive such payment from
the money so held in trust.

[signature page follows]

70

 

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

	 	 	 	 	 	 	 
	 	 	COMSTOCK HOMEBUILDING
	 	 	COMPANIES, INC.
	 
	 	 	 	 	 	 
	 

	 	By:
	 	/s/ Christopher Clemente
 

	 	 
	 

	 	Name:
	 	Christopher Clemente
 

	 	 
	 

	 	Title:
	 	 Chairman and Chief Executive Officer	 	 
	 

	 	 	 	 

	 	 
	 
	 	 	 	 	 	 
	 	 	WELLS FARGO BANK, N.A., as Trustee
	 
	 	 	 	 	 	 
	 

	 	By:	 	/s/ Tracy M. McLamb	 	 
	 

	 	 	 	 

	 	 
	 

	 	Name:	 	Tracy M. McLamb	 	 
	 

	 	 	 	 

	 	 
	 

	 	Title:	 	Vice President	 	 
	 

	 	 	 	 

	 	 

[Indenture]

 

 

Schedule A

DETERMINATION OF LIBOR

          With respect to the Senior Notes, the London interbank offered rate (“LIBOR”) shall be
determined by the Calculation Agent in accordance with the following provisions (in each case
rounded to the nearest .000001%):

(1) On the second LIBOR Business Day (as defined below) prior to an Interest Payment Date
occurring after the expiration of the Fixed Rate Period (each such day, a “LIBOR Determination
Date”), LIBOR for any given security shall for the following interest payment period equal the
rate, as obtained by the Calculation Agent from Bloomberg Financial Markets Commodities News, for
three (3)-month Eurodollar deposits that appears on Dow Jones Telerate Page 3750 (as defined in
the International Swaps and Derivatives Association, Inc. 2000 Interest Rate and Currency Exchange
Definitions, as the same may be amended from time to time), or such other page as may replace such
Page 3750 (as any such replacement may be amended from time to time), as of 11:00 A.M. (London
time) on such LIBOR Determination Date.

(2) If, on any LIBOR Determination Date, such rate does not appear on Dow Jones Telerate Page 3750
or such other page as may replace such Page 3750, the Calculation Agent shall determine the
arithmetic mean of the offered quotations of the Reference Banks (as defined below) to leading
banks in the London interbank market for three (3)-month Eurodollar deposits in an amount
determined by the Calculation Agent by reference to requests for quotations as of approximately
11:00 A.M. (London time) on the LIBOR Determination Date made by the Calculation Agent to the
Reference Banks. If, on any LIBOR Determination Date, at least two of the Reference Banks provide
such quotations, LIBOR shall equal such arithmetic mean of such quotations. If, on any LIBOR
Determination Date, only one or none of the Reference Banks provide such quotations, LIBOR shall
be deemed to be the arithmetic mean of the offered quotations that leading banks in the City of
New York selected by the Calculation Agent are quoting on the relevant LIBOR Determination Date
for three (3)-month Eurodollar deposits in an amount determined by the Calculation Agent by
reference to the principal London offices of leading banks in the London interbank market;
provided, that if the Calculation Agent is required but is unable to determine a rate in
accordance with at least one of the procedures provided above or adequate and fair means do not
exist for ascertaining the applicable interest rate on the basis set forth above (due to changes
arising in the interbank Eurocurrency market or otherwise), then the Senior Notes shall not bear
interest in respect of LIBOR but shall instead bear interest with reference to a floating rate
equal to the Base Rate (as defined below).

(3) As used herein: “Reference Banks” means four (4) major banks in the London interbank
market selected by the Calculation Agent; “LIBOR Business Day” means a day on which
commercial banks are open for business (including dealings in foreign exchange and foreign
currency deposits) in London; the “Base Rate” on any day shall equal the greater of the arithmetic
mean of (i) the “prime rate” for dollar denominated loans quoted by leading banks in the City of
New York selected by the Calculation Agent and (ii) the Federal Funds Rate (as defined below) plus
0.50% per annum; and the “Federal Funds Rate” on any day equals the rate per annum equal
to the weighted average (rounded upwards to the nearest 0.000001) of the rate on overnight federal
funds transactions with members of the Federal Reserve System only arranged by federal funds
brokers, as published as of such day by the Federal Reserve Bank of New York.exv10w3

 

Exhibit 10.3

	 	 	 	 	 
	 

	 	 

Burr & Forman LLP
 

	 	   
	Gary
W. Farris 

Direct Dial: (404) 685-4250

Direct Fax: (404)214-7388

Email: gfairis@lmrr.com

	 	ATTORNEYS AND COUNSELORS

POST OFFICE BOX 54617

ATLANTA, GEORGIA 3O3O6

(4O4) 815-3000
 (4O4) 817-3244 (FAX)

www.burr.com
	 	     

May 3, 2007

Via Certified Mail, Return Receipt Requested,

 and Via First Class, U.S. Mail

Comstock Homebuilding Companies, Inc.

11465 Sunset Hills Rd., Suite 510

Reston, Virginia 20190

Comstock Homes of Atlanta, LLC

5400 Laurel Springs Pkwy

Suwanee, Georgia 30024

Comstock James Road, LLC

5400 Laurel Springs Pkwy #201

Suwanee, Georgia 30024

Highland Station Partners, LLC

5400 Laurel Springs Pkwy #201

Suwanee, Georgia 30024

	 	 	 	 	 	 	 	 	 
	 
	 	Re:	 	Notice of Default, Acceleration of Indebtedness, and Intent to

	 
	 	 	 	 	 	Collect Attorneys’ Fees Pursuant to O.C.G.A. § 13-1-11

Ladies and Gentlemen:

     This firm represents Regions Bank (“Regions Bank” or the “Lender”) in connection with the
following loans payable by Comstock Homes of Atlanta, LLC (“Comstock Atlanta”), Comstock James
Road, LLC (“Comstock James Road”), and Highland Station Partners, LLC (“Highland Station” and
together with Comstock Atlanta and Comstock James Road, the “Borrowers”),

     (1) Loan in the stated principal amount of $1,544,700.00 (the “Traditions of
Braselton Loan”), which is (i) evidenced, together with any and all modifications
and amendments, by that certain Construction Loan Note dated December 2, 2004,
payable by Comstock Atlanta in said principal amount, (ii) secured by that certain
Deed to Secure Debt and Security Agreement dated December 2, 2004, and recorded on
December 22, 2004, in Deed Book 37C, Page 589, Jackson County, Georgia records,
encumbering Lots 17, 18, 34, and 35, Pod

													
	 	 	 	 	 	 	 	 	 	 	 	 	 
	ALABAMA
	 	•
	 	GEORGIA
	 	•
	 	MISSISSIPPI
	 	•
	 	TENNESSEE

 

 

	 	 	 
	 

Burr & Forman LLP
 

	 	   

Comstock Homebuilding Companies, Inc.

Comstock Homes of Atlanta, LLC

Comstock James Road, LLC

Highland Station Partners, LLC

May 3, 2007

Page 2

N, of the Traditions of Braselton Subdivision, and (iii) unconditionally guaranteed by
Comstock Homebuilding Companies, Inc. (the “Guarantor”) pursuant to that certain Guaranty
dated December 2, 2004;

     (2) Loan in the stated principal amount of $956,250.00 (the “Post Road
Loan”), which is (i) evidenced by that certain Note dated April 28, 2006, payable
by Comstock Atlanta in said principal amount, (ii) secured by that certain Deed to
Secure Debt and Security Agreement dated April 28, 2006 and recorded on May 2,
2006, in Deed Book 4256, Page 681, Forsyth County, Georgia records,
encumbering Land Lot 402 of the 2nd District, 1st Section (said property
containing 8.50 acres), and (iii) unconditionally guaranteed by Guarantor pursuant to
that certain Guaranty dated April 28 2006;

     (3) Loan secured by all of the property shown on that certain Final Plat
for Highland Station Subdivision (the “Highland Station Loan”), as evidenced by:

          (a) Loan in the stated principal amount of $5,337,000.00 (the
“2004 Highland Station Loan”) which is (i) evidenced by that certain Construction
Loan Note dated November 16, 2004, payable by Highland Station in said principal
amount, (ii) secured by that certain Deed to Secure Debt and Security Agreement
dated November 16, 2004, recorded on November 22, 2004 in Deed Book 40666,
Page 0047, Gwinnett County, Georgia records, and re-recorded to correct the
Lender’s address as shown on Page 3 on March 9, 2005 in Deed Book 41903, Page
0031, Gwinnett County, Georgia records, encumbering Land Lot 193 and 194 of the
7th Land District, Gwinnett County, Georgia, and (iii) unconditionally guaranteed by
Guarantor pursuant to that certain Modification Agreement dated May 31, 2006;

          (b) Loan in the stated principal amount of $12,000,000.00 (the
“2006 Highland Station Loan”) which is (i) evidenced by that certain Line of Credit
Note dated July 28, 2006, payable by Highland Station in said principal amount, (ii)
secured by that certain Deed to Secure Debt, Assignment and Security Agreement
dated July 28, 2006 and recorded on August 7, 2006 in Deed Book 46852, Page
0436, Gwinnett County, Georgia records, encumbering Land Lots 193 and 194 of the
7th District, City of Suwanee, Gwinnett County, Georgia and being all of the
property shown on that certain Final Plat for Highland Station Subdivision, (iii)
unconditionally guaranteed by Guarantor pursuant to that certain Guaranty dated July
28, 2006.

 

 

	 	 	 
	 

Burr & Forman LLP
 

	 	   

Comstock Homebuilding Companies, Inc.

Comstock Homes of Atlanta, LLC

Comstock James Road, LLC

Highland Station Partners, LLC

May 3, 2007

Page 3

          (c) The 2004 Highland Station Loan and the 2006 Highland Station Loan were
cross defaulted by that certain Cross Default Agreement dated July 28, 2006 between
Highland Station and Regions; and

     (4) Loan in the stated principal amount of $3,300,000.00 (the “James Road
Loan”) which is (i) evidenced by that certain Construction Loan Note dated
September 28, 2006, payable by Comstock James Road in said principal amount, (ii)
secured by that certain Deed to Secure Debt and Security Agreement dated September
28, 2006 and recorded on October 9, 2006 in Deed Book 4477, Page 317, Forsyth
County, Georgia records, encumbering Land Lot 753 of the 2nd District, 1st Section
of Forsyth County (said tract containing 15.029 acres), and (iii) unconditionally
guaranteed by Guarantor pursuant to that certain Guaranty dated September 28, 2006.

The loans described above are collectively referred to herein as the “Loans” and the documents
described above are collectively referred to as the “Loan Documents.”

     This letter is to serve notice that the Loans are IN DEFAULT and hereby declared in default by
virtue of the Borrowers’ failure to perform its obligations owed to Regions Bank under the Loan
Documents, including, without limitation, the Borrowers’ failure to pay the indebtedness as and
when due and in the manner specified in the Loan Documents.

     Pursuant to its rights and remedies under the Loan Documents, Regions Bank has declared all
indebtedness outstanding under the Loans immediately due and payable in full. Regions Bank hereby
demands that the Borrowers pay the Loans immediately, including all principal, interest, and other
sums payable under the Loan Documents. Regions Bank also demands that the Guarantor, as guarantor
of the Loans, honor its obligations to the Bank to pay the Loans upon the default of the
Borrowers.

 

 

	 	 	 
	 

Burr & Forman LLP
 

	 	   

Comstock Homebuilding Companies, Inc.

Comstock Homes of Atlanta, LLC

Comstock James Road, LLC

Highland Station Partners, LLC

May 3, 2007

Page 4

     As of May 1, 2007, the indebtedness due and owing under the Loan Documents is as follows:

	 	 	 	 	 	 	 
	(1)

	 	Traditions of Braselton Loan:	 	 	 	 
	 

	 	(a) Principal
	 	$	1,010,557.44	 
	 

	 	(b) Accrued but unpaid interest
	 	$	3,929.95	 
	 

	 	(c) Accrued but unpaid late fees
	 	$	0.00	 
	 

	 	 	 	 	 	 
	Total:

	 	 	 	$	1,014,487.39	 
	 

	 	 	 	 	 	 
	(2)

	 	Post Road Loan:	 	 	 	 
	 

	 	(a) Principal
	 	$	956,250.00	 
	 

	 	(b) Accrued but unpaid interest
	 	$	3,718.75	 
	 

	 	(c) Accrued but unpaid late fees
	 	$	0.00	 
	 

	 	 	 	 	 	 
	Total:

	 	 	 	$	959,968.75	 
	 

	 	 	 	 	 	 
	(3)

	 	Highland Station Loan:	 	 	 	 
	 

	 	(a) Principal
	 	$	6,184,665.46	 
	 

	 	(b) Accrued but unpaid interest
	 	$	20,974.17	 
	 

	 	(c) Accrued but unpaid late fees
	 	$	0.00	 
	 

	 	 	 	 	 	 
	Total

	 	 	 	$	6,205,639.63	 
	 

	 	 	 	 	 	 
	(4)

	 	James Road Loan:	 	 	 	 
	 

	 	(a) Principal
	 	$	2,960,145.10	 
	 

	 	(b) Accrued but unpaid interest
	 	$	10,617.06	 
	 

	 	(c) Accrued but unpaid late fees
	 	$	0.00	 
	 

	 	 	 	 	 	 
	Total

	 	 	 	$	2,970,762.16	 
	 

	 	 	 	 	 	 
	Amount Due:	 	$	11,150,857.93	 

 

 

	 	 	 
	 

Burr & Forman LLP
 

	 	   

Comstock Homebuilding Companies, Inc. 

Comstock Homes of Atlanta, LLC

Comstock James Road, LLC 

Highland Station Partners, LLC

May 3, 2007 

Page 5

     In addition to the amounts shown above, the “Amount Due” under the Loans will also include (i)
interest that accrues on the Loans after the date of this notice at the default rate of interest
set forth in the Loan Documents and (ii) any attorneys’ fees and expenses incurred by Lender with
respect to the collection, enforcement, and preservation of the Loans and the Loan Documents. These
additional amounts will be provided to you at your request.

     Please be on notice that the provisions of the Loan Documents relative to the payment of
attorney’s fees shall be enforced, and you have ten (10) days from the date of receipt of this
notice to pay the Amount Due (exclusive of the attorneys’ fees) without incurring liability for
the attorney’s fees. This notice is provided pursuant to O.C.G.A. § 13-1-11.

     A copy of this letter is being sent to you by regular mail. Refusal of delivery is deemed,
under applicable law, to be equivalent of notice.

     Regions Bank hereby reserves all of its rights and remedies under the Loan Documents and any
other loan documents or agreements between the parties, at law, and in equity, including without
limitation, the right to take any and all action deemed necessary to protect the interests of
Regions Bank. Voluntary forbearance by Regions Bank in the exercise of such rights shall not waive
or limit the subsequent exercise of such rights.

     This letter is an attempt to collect a debt and any information obtained by virtue of it will
be used for that purpose.

     Please govern yourself accordingly.

	 	 	 	 	 
	 	Sincerely,

 	 
	 	
 	 
	 	Gary W. Farris   	 
	 	 	 
	 

GWF/alp

cc: Mr. William Teegarden

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