Document:

<PAGE>

                                                                    EXHIBIT 4.10

                                                                  Execution Copy

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

                                 BLUM CB Corp.
                                    Issuer

                              CBRE Holding, Inc.
                                    Parent

              11 1/4% Senior Subordinated Notes Due June 15, 2011

                             ____________________

                                   INDENTURE

                           Dated as of June 7, 2001

                             _____________________

                      State Street Bank and Trust Company
                              of California, N.A.
                                    Trustee

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

                             CROSS-REFERENCE TABLE

<TABLE>
<CAPTION>
  TIA                                                         Indenture
Section                                                 Section
-------                                                 -------
<S>                                                     <C>
310(a)(1)         ..............................        7.10
    (a)(2)        ..............................        7.10
    (a)(3)        ..............................        N.A.
    (a)(4)        ..............................        N.A.
    (b)           ..............................        7.08; 7.10
    (c)           ..............................        N.A.
311(a)            ..............................        7.11
    (b)           ..............................        7.11
    (c)           ..............................        N.A.
312(a)            ..............................        2.05
    (b)           ..............................        13.03
    (c)           ..............................        13.03
313(a)            ..............................        7.06
    (b)(1)        ..............................        N.A.
    (b)(2)        ..............................        7.06
    (c)           ..............................        11.02
    (d)           ..............................        7.06
314(a)            ..............................        4.02;13.02
    (b)           ..............................        N.A.
    (c)(1)        ..............................        13.04
    (c)(2)        ..............................        13.04
    (c)(3)        ..............................        N.A.
    (d)           ..............................        N.A.
    (e)           ..............................        13.05
    (f)           ..............................        N.A.
315(a)            ..............................        7.01
    (b)           ..............................        7.05; 13.02
    (c)           ..............................        7.01
    (d)           ..............................        7.01
    (e)           ..............................        6.11
316(a)(last sentence) ......................            13.06
    (a)(1)(A)     ..............................        6.05
    (a)(1)(B)     ..............................        6.04
    (a)(2)        ..............................        N.A.
    (b)           ..............................        6.07
317(a)(1)         ..............................        6.08
    (a)(2)        ..............................        6.09
    (b)           ..............................        2.04
318(a)            ..............................        13.01
</TABLE>

                          N.A. means Not Applicable.

_____________________
Note: This Cross-Reference Table shall not, for any purpose, be deemed to be
part of the Indenture.
<PAGE>

                               TABLE OF CONTENTS
<TABLE>
<CAPTION>
                                                                                                            Page
                                                                                                            ----
<S>                                                                                                         <C>
                                                 ARTICLE 1

                                 Definitions and Incorporation by Reference

SECTION 1.01.  Definitions..................................................................................   1
SECTION 1.02.  Other Definitions............................................................................  36
SECTION 1.03.  Incorporation by Reference of Trust Indenture Act............................................  36
SECTION 1.04.  Rules of Construction........................................................................  37

                                                 ARTICLE 2

                                               The Securities

SECTION 2.01.  Form and Dating..............................................................................  37
SECTION 2.02.  Execution and Authentication.................................................................  38
SECTION 2.03.  Registrar and Paying Agent...................................................................  38
SECTION 2.04.  Paying Agent To Hold Money in Trust..........................................................  39
SECTION 2.05.  Securityholder Lists.........................................................................  39
SECTION 2.06.  Transfer and Exchange........................................................................  39
SECTION 2.07.  Replacement Securities.......................................................................  39
SECTION 2.08.  Outstanding Securities.......................................................................  40
SECTION 2.09.  Temporary Securities.........................................................................  40
SECTION 2.10.  Cancellation.................................................................................  41
SECTION 2.11.  Defaulted Interest...........................................................................  41
SECTION 2.12.  CUSIP Numbers................................................................................  41
SECTION 2.13.  Issuance of Additional Securities............................................................  41

                                                 ARTICLE 3

                                                 Redemption

SECTION 3.01.  Notices to Trustee...........................................................................
SECTION 3.02.  Selection of Securities To Be Redeemed.......................................................  43
SECTION 3.03.  Notice of Redemption.........................................................................  43
SECTION 3.04.  Effect of Notice of Redemption...............................................................  44
SECTION 3.05.  Deposit of Redemption Price..................................................................  44
SECTION 3.06.  Securities Redeemed in Part..................................................................  45

                                                 ARTICLE 4

                                                 Covenants

SECTION 4.01.  Payment of Securities........................................................................  45
SECTION 4.02.  SEC Reports..................................................................................  45
SECTION 4.03.  Limitation on Indebtedness...................................................................  46
SECTION 4.04.  Limitation on Restricted Payments............................................................  51
</TABLE>
<PAGE>

                                                                               2

<TABLE>
<S>                                                                                                           <C>
SECTION 4.05.  Limitation on Restrictions on Distributions from Restricted Subsidiaries.....................  54
SECTION 4.06.  Limitation on Sales of Assets and Subsidiary Stock...........................................  56
SECTION 4.07.  Limitation on Affiliate Transactions.........................................................  60
SECTION 4.08.  Limitation on the Sale or Issuance of Capital Stock of Restricted Subsidiaries...............  62
SECTION 4.10.  Future Guarantors............................................................................  64
SECTION 4.11.  Compliance Certificate.......................................................................  65
SECTION 4.12.  Payment of Additional Interest...............................................................  65
SECTION 4.13.  Further Instruments and Acts.................................................................  65

                                                 ARTICLE 5

                                          Merger and Consolidation

SECTION 5.01.  When Company, Subsidiary Guarantors and Parent May Merge or Transfer Assets..................  65

                                                 ARTICLE 6

                                           Defaults and Remedies

SECTION 6.01.  Events of Default............................................................................  68
SECTION 6.02.  Acceleration.................................................................................  70
SECTION 6.03.  Other Remedies...............................................................................  71
SECTION 6.04.  Waiver of Past Defaults......................................................................  71
SECTION 6.05.  Control by Majority..........................................................................  72
SECTION 6.06.  Limitation on Suits..........................................................................  72
SECTION 6.07.  Rights of Holders to Receive Payment.........................................................  73
SECTION 6.08.  Collection Suit by Trustee...................................................................  73
SECTION 6.09.  Trustee May File Proofs of Claim.............................................................  73
SECTION 6.10.  Priorities...................................................................................  73
SECTION 6.11.  Undertaking for Costs........................................................................  74
SECTION 6.12.  Waiver of Stay or Extension Laws.............................................................  74

                                                  ARTICLE 7

                                                   Trustee

SECTION 7.01.  Duties of Trustee............................................................................  74
SECTION 7.02.  Rights of Trustee............................................................................  76
SECTION 7.03.  Individual Rights of Trustee.................................................................  76
SECTION 7.04.  Trustee's Disclaimer.........................................................................  76
SECTION 7.05.  Notice of Defaults...........................................................................  77
SECTION 7.06.  Reports by Trustee to Holders................................................................  77
SECTION 7.07.  Compensation and Indemnity...................................................................  77
SECTION 7.08.  Replacement of Trustee.......................................................................  78
SECTION 7.09.  Successor Trustee by Merger..................................................................  79
SECTION 7.10.  Eligibility; Disqualification................................................................  79
SECTION 7.11.  Preferential Collection of Claims Against Company............................................  80
</TABLE>
<PAGE>

                                                                               3

<TABLE>
<S>                                                                                                           <C>
                                                 ARTICLE 8

                                     Discharge of Indenture; Defeasance

SECTION 8.01.  Discharge of Liability on Securities; Defeasance.............................................  80
SECTION 8.02.  Conditions to Defeasance.....................................................................  81
SECTION 8.03.  Application of Trust Money...................................................................  82
SECTION 8.04.  Repayment to Company.........................................................................  83
SECTION 8.05.  Indemnity for Government Obligations.........................................................  83
SECTION 8.06.  Reinstatement................................................................................  83

                                                 ARTICLE 9

                                                 Amendments

SECTION 9.01.  Without Consent of Holders...................................................................  84
SECTION 9.02.  With Consent of Holders......................................................................  85
SECTION 9.03.  Compliance with Trust Indenture Act..........................................................  86
SECTION 9.04.  Revocation and Effect of Consents and Waivers................................................  86
SECTION 9.05.  Notation on or Exchange of Securities........................................................  86
SECTION 9.06.  Trustee To Sign Amendments...................................................................  87
SECTION 9.07.  Payment for Consent..........................................................................  87

                                                 ARTICLE 10

                                               Subordination

SECTION 10.01. Agreement To Subordinate.....................................................................  87
SECTION 10.02. Liquidation, Dissolution, Bankruptcy.........................................................  87
SECTION 10.03. Default on Senior Indebtedness of the Company................................................  88
SECTION 10.04. Acceleration of Payment of Securities........................................................  89
SECTION 10.05. When Distribution Must Be Paid Over..........................................................  90
SECTION 10.06. Subrogation..................................................................................  90
SECTION 10.07. Relative Rights..............................................................................  90
SECTION 10.08. Subordination May Not Be Impaired by Company.................................................  90
SECTION 10.09. Rights of Trustee and Paying Agent...........................................................  91
SECTION 10.10. Distribution or Notice to Representative.....................................................  91
SECTION 10.11. Article 10 Not To Prevent Events of Default or Limit Right To Accelerate.....................  91
SECTION 10.12. Trust Moneys Not Subordinated................................................................  91
SECTION 10.13. Trustee Entitled To Rely.....................................................................  92
SECTION 10.14. Trustee To Effectuate Subordination..........................................................  92
SECTION 10.15. Trustee Not Fiduciary for Holders of Senior Indebtedness of the Company......................  93
SECTION 10.16. Reliance by Holders of Senior Indebtedness of the Company on Subordination Provisions........  93
</TABLE>
<PAGE>

                                                                               4

<TABLE>
<S>                                                                                                          <C>
                                                 ARTICLE 11

                                                 Guaranties

SECTION 11.01. Guaranties...................................................................................  93
SECTION 11.02. Limitation on Liability......................................................................  96
SECTION 11.03. Successors and Assigns.......................................................................  96
SECTION 11.04. No Waiver....................................................................................  96
SECTION 11.05. Modification.................................................................................  96
SECTION 11.06. Release of Subsidiary Guarantor..............................................................  96

                                                 ARTICLE 12

                                        Subordination of Guaranties

SECTION 12.01. Agreement To Subordinate.....................................................................  97
SECTION 12.02. Liquidation, Dissolution, Bankruptcy.........................................................  97
SECTION 12.03. Default on Senior Indebtedness of Guarantor..................................................  98
SECTION 12.04. Demand for Payment...........................................................................  99
SECTION 12.05. When Distribution Must Be Paid Over.......................................................... 100
SECTION 12.06. Subrogation.................................................................................. 100
SECTION 12.07. Relative Rights.............................................................................. 100
SECTION 12.08. Subordination May Not Be Impaired by Company................................................. 100
SECTION 12.09. Rights of Trustee and Paying Agent........................................................... 101
SECTION 12.10. Distribution or Notice to Representative..................................................... 101
SECTION 12.11. Article 12 Not To Prevent Events of Default or Limit Right To Demand Payment................. 101
SECTION 12.12. Trustee Entitled To Rely..................................................................... 101
SECTION 12.13. Trustee To Effectuate Subordination.......................................................... 102
SECTION 12.14. Trustee Not Fiduciary for Holders  of Senior Indebtedness of Guarantor....................... 102
SECTION 12.15. Reliance by Holders of Senior Indebtedness of Guarantors on Subordination Provisions......... 102

                                                 ARTICLE 13

                                               Miscellaneous

SECTION 13.01. Trust Indenture Act Controls................................................................. 103
SECTION 13.02. Notices...................................................................................... 103
SECTION 13.03. Communication by Holders with Other Holders.................................................. 104
SECTION 13.04. Certificate and Opinion as to Conditions Precedent........................................... 104
SECTION 13.05. Statements Required in Certificate or Opinion................................................ 104
SECTION 13.06. When Securities Disregarded.................................................................. 105
SECTION 13.07. Rules by Trustee, Paying Agent and Registrar................................................. 105
</TABLE>
<PAGE>

                                                                               5

<TABLE>
<S>                                                                                                          <C>
SECTION 13.08. Legal Holidays............................................................................... 105
SECTION 13.09. Governing Law................................................................................ 105
SECTION 13.10. No Recourse Against Others................................................................... 105
SECTION 13.11. Successors................................................................................... 106
SECTION 13.12. Multiple Originals........................................................................... 106
SECTION 13.13. Table of Contents; Headings.................................................................. 106
</TABLE>
<PAGE>

                                                                               6

Rule 144A/Regulation S Appendix

Exhibit 1 - Form of Initial Security

Exhibit A - Form of Exchange Security or Private Exchange Security
<PAGE>

                    INDENTURE dated as of June 7, 2001, between BLUM CB CORP., a
               Delaware corporation (the "Company"), CBRE HOLDING, INC.
               ("Parent") and STATE STREET BANK AND TRUST COMPANY OF CALIFORNIA,
               N.A. (the "Trustee").

          Each party agrees as follows for the benefit of the other parties and
for the equal and ratable benefit of the Holders of the Company's Initial
Securities, Exchange Securities and Private Exchange Securities (collectively,
the "Securities"):

                                   ARTICLE 1

                  Definitions and Incorporation by Reference
                  ------------------------------------------

          SECTION 1.01.  Definitions.
                         ------------

          "Additional Assets" means (1) any property or other assets (other than
Indebtedness and Capital Stock) used in a Related Business; (2) the Capital
Stock of a Person that becomes a Restricted Subsidiary as a result of the
acquisition of such Capital Stock by the Company or another Restricted
Subsidiary; or (3) Capital Stock constituting a minority interest in any Person
that at such time is a Restricted Subsidiary; provided, however, that any such
                                              --------  -------
Restricted Subsidiary described in clause (2) or (3) above is primarily engaged
in a Related Business.

          "Additional Securities" means, subject to the Company's compliance
with Section 4.03, 11 1/4% Senior Subordinated Notes Due June 15, 2011 issued
from time to time after the Issue Date under the terms of this Indenture (other
then pursuant to Section 2.06, 2.07, 2.09 or 3.06 of this Indenture and other
than Exchange Securities or Private Exchange Securities issued pursuant to an
exchange offer for other Securities outstanding under this Indenture).

          "Affiliate" of any specified Person means any other Person, directly
or indirectly, controlling or controlled by or under direct or indirect common
control with such specified Person. For the purposes of this definition,
"control" when used with respect to any Person means the power to direct the
management and policies of such Person, directly or indirectly, whether through
the ownership of voting securities, by contract or otherwise; and the terms
"controlling" and "controlled" have meanings correlative to the foregoing. For
purposes of Sections 4.04, 4.06 and 4.07 only, "Affiliate" shall also
<PAGE>

                                                                               2

mean any beneficial owner of Capital Stock representing 10% or more of the total
voting power of the Voting Stock (on a fully diluted basis) of the Company or of
rights or warrants to purchase such Capital Stock (whether or not currently
exercisable) and any Person who would be an Affiliate of any such beneficial
owner pursuant to the first sentence hereof.

          "Asset Disposition" means any sale, lease, transfer or other
disposition (or series of related sales, leases, transfers or dispositions) by
the Company or any Restricted Subsidiary, including any disposition by means of
a merger, consolidation or similar transaction (each referred to for the
purposes of this definition as a "disposition"), of

          (1)  any shares of Capital Stock of a Restricted Subsidiary (other
     than directors' qualifying shares or shares required by applicable law to
     be held by a Person other than the Company or a Restricted Subsidiary),

          (2)  all or substantially all the assets of any division or line of
     business of the Company or any Restricted Subsidiary or

          (3)  any other assets of the Company or any Restricted Subsidiary
     outside of the ordinary course of business of the Company or such
     Restricted Subsidiary

(other than, in the case of (1), (2) and (3) above, (A) a disposition by a
Restricted Subsidiary to the Company or by the Company or a Restricted
Subsidiary to a Restricted Subsidiary, (B) for purposes of Section 4.06 only, a
disposition that constitutes a Restricted Payment permitted by Section 4.04 or a
Permitted Investment, (C) the sale by Melody of assets purchased and/or funded
pursuant to the Melody Mortgage Warehousing Facility or the Melody Loan
Arbitrage Facility, (D) any sale of Capital Stock in, or Indebtedness or other
securities of, an Unrestricted Subsidiary, (E) a disposition of Temporary Cash
Investments in the ordinary course of business, (F) the disposition of property
or assets that are obsolete, damaged or worn out, (G) the lease or sublease of
office space in the ordinary course of business, (H) sales by Melody of debt
servicing rights not in excess of $5.0 million in the aggregate and (I) a
disposition of assets with a fair market value of less than $750,000 (a "de
minimis disposition"), so long as the sum of such de minimis disposition plus
all other de minimis dispositions previously made in the same calendar year does
not exceed $3.0 million in the aggregate);
<PAGE>

                                                                               3

provided, however, that a disposition of all or substantially all the assets of
--------  -------
the Company and its Restricted Subsidiaries taken as a whole will be governed by
Section 4.09 and/or Section 5.01 and not by Section 4.06.

          "Attributable Debt" in respect of a Sale/Leaseback Transaction means,
as at the time of determination, the present value (discounted at the interest
rate borne by the Securities, compounded annually) of the total obligations of
the lessee for rental payments during the remaining term of the lease included
in such Sale/Leaseback Transaction (including any period for which such lease
has been extended); provided, however, that if such Sale/Leaseback Transaction
                    --------  -------
results in a Capital Lease Obligation, the amount of Indebtedness represented
thereby will be determined in accordance with the definition of "Capital Lease
Obligation".

          "Average Life" means, as of the date of determination, with respect
to any Indebtedness the quotient obtained by dividing (1) the sum of the
products of the number of years from the date of determination to the dates of
each successive scheduled principal payment of or redemption or similar payment
with respect to such Indebtedness multiplied by the amount of such payment by
(2) the sum of all such payments.

          "Bank Indebtedness" means all Obligations pursuant to the Credit
Agreement.

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

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

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

          "Capital Stock" of any Person means any and all shares, interests,
rights to purchase, warrants, options, participation or other equivalents of or
interests in
<PAGE>

                                                                               4

(however designated) equity of such Person, including any Preferred Stock, but
excluding any debt securities convertible into such equity.

          "Cash Equity Contributions" shall mean (a) the contribution to Parent
of not less than $98,800,000 in cash in the form of equity (it being understood
that (i) any contribution to Parent by RCBA of shares of common equity of CB
Richard Ellis Services in excess of 2,345,900 shares will be considered a cash
contribution by RCBA in an amount equal to $16.00 multiplied by the number of
shares constituting such excess and a contribution of such amount from Parent to
the Company and (ii) the transfer by designated managers of an aggregate of up
to $2.6 million of deferred compensation plan account balances (currently
reflected as cash surrender value of insurance policies, deferred compensation
plan in the financial statements of the Company) to stock fund units shall be
deemed to be a cash contribution to Parent of the amount of such transfer and a
contribution of such amount from Parent to the Company to the extent (x)
accounted for as equity of the Company and (y) such transfer of an account
balance results in a transfer to the Company of cash from the trust relating to
such deferred compensation plan) and (b) the contribution by Parent of the
amount so received, together with the net proceeds from its sale of the Parent
Senior Notes, to the Company as equity in exchange for Capital Stock (other than
Disqualified Stock) of the Company.

          "CB Richard Ellis Services" means CB Richard Ellis Services, Inc., a
Delaware corporation.

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

          (1)  prior to the earlier to occur of (A) the first underwritten
     public offering of common stock of Parent or (B) the first public offering
     of common stock of the Company, (x) the Permitted Holders cease to be the
     "beneficial owner" (as defined in Rules 13d-3 and 13d-5 under the Exchange
     Act), directly or indirectly, of a majority in the aggregate of the total
     voting power of the Voting Stock of the Company, whether as a result of
     issuance of securities of Parent or the Company, any merger, consolidation,
     liquidation or dissolution of Parent or the Company, or any direct or
     indirect transfer of securities by Parent or otherwise and (y) RCBA ceases
     to (i) be the beneficial owner, directly or indirectly, of at least 35% of
     the total voting power of the Voting Stock of the Company or (ii) have the
     right or ability by voting power,
<PAGE>

                                                                               5

     contract or otherwise to elect or designate for election a majority of the
     Board of Directors (for purposes of this clause (1) and clause (2) below,
     the Permitted Holders shall be deemed to beneficially own any Voting Stock
     of a Person (the "specified Person") held by any other Person (the "parent
     entity") so long as the Permitted Holders beneficially own (as so defined),
     directly or indirectly, (1) in the case of a parent entity that is Parent,
     in the aggregate at least 35% of the voting power of the Voting Stock of
     Parent and have the right or ability by voting power, contract or otherwise
     to elect or designate for election a majority of the Board of Directors or
     (2) in the case of any other parent entity, in the aggregate a majority of
     the voting power of the Voting Stock of the parent entity);

          (2)  any "person" (as such term is used in Sections 13(d) and 14(d)
     of the Exchange Act), other than one or more Permitted Holders, is or
     becomes the beneficial owner (as defined in clause (1) above, except that
     for purposes of this clause (2) such person shall be deemed to have
     "beneficial ownership" of all shares that any such person has the right to
     acquire, whether such right is exercisable immediately or only after the
     passage of time and except that any Person that is deemed to have
     beneficial ownership of shares solely as the result of being part of a
     group pursuant to Rule 13d-5(b)(1) shall be deemed not to have beneficial
     ownership of any shares held by a Permitted Holder forming a part of such
     group), directly or indirectly, of more than 35% of the total voting power
     of the Voting Stock of the Company; provided, however, that the Permitted
                                         --------  -------
     Holders beneficially own (as defined in clause (1) above , except that in
     the event the Permitted Holders are part of a group pursuant to Rule 13d-
     5(b)(1), the Permitted Holders shall be deemed not to have beneficial
     ownership of any shares held by persons other than Permitted Holders
     forming a part of such group), directly or indirectly, in the aggregate a
     lesser percentage of the total voting power of the Voting Stock of the
     Company than such other person and do not have the right or ability by
     voting power, contract or otherwise to elect or designate for election a
     majority of the Board of Directors (for the purposes of this clause (2),
     such other person shall be deemed to beneficially own any Voting Stock of a
     specified Person held by a parent entity, if such other person is the
     beneficial owner (as defined in this clause (2)), directly or indirectly,
     of more than 35% of the voting power of the Voting Stock of such parent
<PAGE>

                                                                               6

     entity and the Permitted Holders beneficially own (as defined in clause (1)
     above), directly or indirectly, in the aggregate a lesser percentage of the
     voting power of the Voting Stock of such parent entity and do not have the
     right or ability by voting power, contract or otherwise to elect or
     designate for election a majority of the board of directors of such parent
     entity);

          (3)  individuals who on the Merger Date constituted the Board of
     Directors (together with any new directors whose election by such Board of
     Directors or whose nomination for election by the shareholders of the
     Company was approved by a vote of a majority of the directors of the
     Company then still in office who were either directors on the Issue Date or
     whose election or nomination for election was previously so approved) cease
     for any reason to constitute a majority of the Board of Directors then in
     office;

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

          (5)  the merger or consolidation of the Company with or into another
     Person or the merger of another Person with or into the Company, or the
     sale of all or substantially all the assets of the Company (determined on a
     consolidated basis) to another Person (other than, in all such cases, a
     Person that is controlled by the Permitted Holders), other than a
     transaction following which (A) in the case of a merger or consolidation
     transaction, holders of securities that represented 100% of the Voting
     Stock of the Company immediately prior to such transaction (or other
     securities into which such securities are converted as part of such merger
     or consolidation transaction) own directly or indirectly at least a
     majority of the voting power of the Voting Stock of the surviving Person in
     such merger or consolidation transaction immediately after such transaction
     and in substantially the same proportion as before the transaction and (B)
     in the case of a sale of assets transaction, the transferee Person becomes
     the obligor in respect of the Securities and a Subsidiary of the transferor
     of such assets.

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

          "Company" means the party named as such in this Indenture until a
successor replaces it and, thereafter, means the successor and, for purposes of
any provision
<PAGE>

                                                                               7

contained herein and required by the TIA, each other obligor on the indenture
securities.

          "Consolidated Coverage Ratio" as of any date of determination means
the ratio of

          (x)  the aggregate amount of EBITDA for the period of the most recent
     four consecutive fiscal quarters for which internal financial statements
     are available ending prior to the date of such determination to

          (y)  Consolidated Interest Expense for such four fiscal quarters;

provided, however, that
--------  -------

          (1)  if the Company or any Restricted Subsidiary has Incurred any
     Indebtedness since the beginning of such period that remains outstanding or
     if the transaction giving rise to the need to calculate the Consolidated
     Coverage Ratio is an Incurrence of Indebtedness, or both, EBITDA and
     Consolidated Interest Expense for such period shall be calculated after
     giving effect on a pro forma basis to such Indebtedness as if such
     Indebtedness had been Incurred on the first day of such period,

          (2)  if the Company or any Restricted Subsidiary has repaid,
     repurchased, defeased or otherwise discharged any Indebtedness since the
     beginning of such period or if any Indebtedness is to be repaid,
     repurchased, defeased or otherwise discharged (in each case other than
     Indebtedness Incurred under any revolving credit facility unless such
     Indebtedness has been permanently repaid and has not been replaced) on the
     date of the transaction giving rise to the need to calculate the
     Consolidated Coverage Ratio, EBITDA and Consolidated Interest Expense for
     such period shall be calculated on a pro forma basis as if such discharge
     had occurred on the first day of such period and as if the Company or such
     Restricted Subsidiary has not earned the interest income actually earned
     during such period in respect of cash or Temporary Cash Investments used to
     repay, repurchase, defease or otherwise discharge such Indebtedness,

          (3)  if since the beginning of such period the Company or any
     Restricted Subsidiary shall have made any Asset Disposition, EBITDA for
     such period shall be reduced by an amount equal to EBITDA (if positive)
     directly attributable to the assets which are the
<PAGE>

                                                                               8

     subject of such Asset Disposition for such period, or increased by an
     amount equal to EBITDA (if negative), directly attributable thereto for
     such period and Consolidated Interest Expense for such period shall be
     reduced by an amount equal to the Consolidated Interest Expense directly
     attributable to any Indebtedness of the Company or any Restricted
     Subsidiary repaid, repurchased, defeased or otherwise discharged with
     respect to the Company and its continuing Restricted Subsidiaries in
     connection with such Asset Disposition for such period (or, if the Capital
     Stock of any Restricted Subsidiary is sold, the Consolidated Interest
     Expense for such period directly attributable to the Indebtedness of such
     Restricted Subsidiary to the extent the Company and its continuing
     Restricted Subsidiaries are no longer liable for such Indebtedness after
     such sale),

          (4)  if since the beginning of such period the Company or any
     Restricted Subsidiary (by merger or otherwise) shall have made an
     Investment in any Restricted Subsidiary (or any person which becomes a
     Restricted Subsidiary) or an acquisition of assets, including any
     acquisition of assets occurring in connection with a transaction requiring
     a calculation to be made hereunder, which constitutes all or substantially
     all of an operating unit of a business, EBITDA and Consolidated Interest
     Expense for such period shall be calculated after giving pro forma effect
     thereto (including the Incurrence of any Indebtedness) as if such
     Investment or acquisition occurred on the first day of such period and

          (5)  if since the beginning of such period any Person (that
     subsequently became a Restricted Subsidiary or was merged with or into the
     Company or any Restricted Subsidiary since the beginning of such period)
     shall have made any Asset Disposition, any Investment or acquisition of
     assets that would have required an adjustment pursuant to clause (3) or (4)
     above if made by the Company or a Restricted Subsidiary during such period,
     EBITDA and Consolidated Interest Expense for such period shall be
     calculated after giving pro forma effect thereto as if such Asset
     Disposition, Investment or acquisition occurred on the first day of such
     period.

For purposes of this definition, whenever pro forma effect is to be given to an
acquisition of assets, the amount of income or earnings relating thereto and the
amount of Consolidated Interest Expense associated with any
<PAGE>

                                                                               9

Indebtedness Incurred in connection therewith, the pro forma calculations shall
be determined in good faith by a responsible financial or accounting Officer of
the Company (and shall include any applicable Pro Forma Cost Savings). If any
Indebtedness bears a floating rate of interest and is being given pro forma
effect, the interest on such Indebtedness shall be calculated as if the rate in
effect on the date of determination had been the applicable rate for the entire
period (taking into account any Interest Rate Agreement applicable to such
Indebtedness if such Interest Rate Agreement has a remaining term in excess of
12 months).

          "Consolidated Interest Expense" means, for any period, the total
interest expense of the Company and its consolidated Restricted Subsidiaries,
plus, to the extent not included in such total interest expense, and to the
extent incurred by the Company or its Restricted Subsidiaries, without
duplication,

          (1)  interest expense attributable to Capital Lease Obligations and
     the interest expense attributable to leases constituting part of a
     Sale/Leaseback Transaction,

          (2)  amortization of debt discount and debt issuance cost,

          (3)  capitalized interest,

          (4)  non-cash interest expense,

          (5)  commissions, discounts and other fees and charges owed with
     respect to letters of credit and bankers' acceptance financing,

          (6)  net payments pursuant to Hedging Obligations in respect of
     Indebtedness,

          (7)  Preferred Stock dividends in respect of all Preferred Stock held
     by Persons other than the Company or a Restricted Subsidiary (other than
     dividends payable solely in Capital Stock (other than Disqualified Stock)
     of the issuer of such Preferred Stock),

          (8)  interest incurred in connection with Investments in discontinued
     operations,

          (9)  interest accruing on any Indebtedness of any other Person to the
     extent such Indebtedness is
<PAGE>

                                                                              10

     Guaranteed by (or secured by the assets of) the Company or any Restricted
     Subsidiary and

          (10) the cash contributions to any employee stock ownership plan or
     similar trust to the extent such contributions are used by such plan or
     trust to pay interest or fees to any Person (other than the Company) in
     connection with Indebtedness Incurred by such plan or trust,

and less, to the extent included in such total interest expense, (A) the
amortization during such period of capitalized financing costs associated with
the Transactions and (B) the amortization during such period of other
capitalized financing costs; provided, however, that the aggregate amount of
                             --------  -------
amortization relating to any such other capitalized financing costs deducted in
calculating Consolidated Interest Expense shall not exceed 3.5% of the aggregate
amount of the financing giving rise to such capitalized financing costs.

          "Consolidated Net Income" means, for any period, the sum of (1) the
net income of the Company and its consolidated Subsidiaries and (2) to the
extent deducted in calculating net income of the Company and its consolidated
Subsidiaries, (A) any non-recurring fees, expenses or charges related to the
Transactions and (B) any non- recurring charges related to one-time severance or
lease termination costs incurred in connection with the Transactions; provided,
                                                                      --------
however, that there shall not be included in such Consolidated Net Income:
-------

          (1)  any net income of any Person (other than the Company) if such
     Person is not a Restricted Subsidiary, except that

               (A)  subject to the exclusion contained in clause (4) below, the
          Company's equity in the net income of any such Person for such period
          shall be included in such Consolidated Net Income up to the aggregate
          amount of cash actually distributed by such Person during such period
          to the Company or a Restricted Subsidiary as a dividend or other
          distribution (subject, in the case of a dividend or other distribution
          paid to a Restricted Subsidiary, to the limitations contained in
          clause (3) below) and

               (B)  the Company's equity in a net loss of any such Person to the
          extent accounted for pursuant to the equity method of accounting for
          such period
<PAGE>

                                                                              11

          shall be included in determining such Consolidated Net Income;

          (2)  any net income (or loss) of any Person acquired by the Company or
     a Subsidiary in a pooling of interests transaction for any period prior to
     the date of such acquisition;

          (3)  any net income of any Restricted Subsidiary if such Restricted
     Subsidiary is subject to restrictions, directly or indirectly, on the
     payment of dividends or the making of distributions by such Restricted
     Subsidiary, directly or indirectly, to the Company, except that

               (A)  subject to the exclusion contained in clause (4) below, the
          Company's equity in the net income of any such Restricted Subsidiary
          for such period shall be included in such Consolidated Net Income up
          to the aggregate amount of cash actually distributed by such
          Restricted Subsidiary during such period to the Company or another
          Restricted Subsidiary as a dividend or other distribution (subject, in
          the case of a dividend or other distribution paid to another
          Restricted Subsidiary, to the limitation contained in this clause) and

               (B)  the Company's equity in a net loss of any such Restricted
          Subsidiary for such period shall be included in determining such
          Consolidated Net Income;

          (4)  any gain (or loss) realized upon the sale or other disposition of
     any assets of the Company, its consolidated Subsidiaries or any other
     Person (including pursuant to any sale-and-leaseback arrangement) which is
     not sold or otherwise disposed of in the ordinary course of business and
     any gain (or loss) realized upon the s ale or other disposition of any
     Capital Stock of any Person;

          (5)  extraordinary gains or losses;

          (6)  the cumulative effect of a change in accounting principles;

          (7)  any income or losses attributable to discontinued operations
     (including operations disposed of during such periods whether or not such
     operations were classified as discontinued);
<PAGE>

                                                                              12

          (8)  any restoration to income of any contingency reserve, except to
     the extent that provision for such reserve was made out of Consolidated Net
     Income accrued at any time following the Issue Date; and

          (9)  if the Successor Company is not the Company, the aggregate net
     income (or loss)of such Successor Company prior to the consolidation,
     merger or transfer resulting in such Successor Company.

Notwithstanding the foregoing, for the purpose of Section 4.04 only, there shall
be excluded from Consolidated Net Income any repurchases, repayments or
redemptions of Investments, proceeds realized on the sale of Investments or
return of capital to the Company or a Restricted Subsidiary to the extent such
repurchases, repayments, redemptions, proceeds or returns increase the amount of
Restricted Payments permitted under such Section pursuant to Section
4.04(a)(3)(D).

          "Credit Agreement" means the Credit Agreement to be entered into among
CB Richard Ellis Services, Parent, as guarantor, the lenders referred to
therein, Credit Suisse First Boston, as Administrative Agent Sole Lead Arranger
and Sole Book Manager, and the Syndication Agent and Documentation Agent named
therein, together with the related documents thereto (including the term loans
and revolving loans thereunder, any guarantees and security documents), as
amended, extended, renewed, restated, supplemented or otherwise modified (in
whole or in part, and without limitation as to amount, terms, conditions,
covenants and other provisions) from time to time, and any agreement (and
related document) governing Indebtedness incurred to Refinance, in whole or in
part, the borrowings and commitments then outstanding or permitted to be
outstanding under such Credit Agreement or a successor Credit Agreement, whether
by the same or any other lender or group of lenders.

          "Currency Agreement" means in respect of a Person any foreign exchange
contract, currency swap agreement or other similar agreement designed to protect
such Person against fluctuations in currency values.

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

          "Designated Senior Indebtedness", with respect to a Person, means (1)
the Bank Indebtedness and (2) any other Senior Indebtedness of such Person
which, at the date of determination, has an aggregate principal amount
outstanding
<PAGE>

                                                                              13

of, or under which, at the date of determination, the holders thereof are
committed to lend up to, at least $25.0 million and is specifically designated
by such Person in the instrument evidencing or governing such Senior
Indebtedness as "Designated Senior Indebtedness" for purposes of this Indenture.

          "Disqualified Stock" means, with respect to any Person, any Capital
Stock which by its terms (or by the terms of any security into which it is
convertible or for which it is exchangeable at the option of the holder) or upon
the happening of any event:

          (1)  matures or is mandatorily redeemable pursuant to a sinking fund
     obligation or otherwise;

          (2)  is convertible or exchangeable at the option of the holder for
     Indebtedness or Disqualified Stock; or

          (3)  is mandatorily redeemable or must be purchased upon the
     occurrence of certain events or otherwise, in whole or in part,

in each case on or prior to the first anniversary of the Stated Maturity of the
Securities; provided, however, that if such Capital Stock is issued to any
            --------  -------
employee or to any plan for the benefit of employees of the Company or its
Subsidiaries or by any such plan to such employees, such Capital Stock shall not
constitute Disqualified Stock solely because it may be required to be
repurchased by the Company in order to satisfy obligations as a result of such
employee's death or disability; and provided further, however, that any Capital
                                    -------- -------  -------
Stock that would not constitute Disqualified Stock but for provisions thereof
giving holders thereof the right to require such Person to purchase or redeem
such Capital Stock upon the occurrence of an "asset sale" or "change of control"
occurring prior to the first anniversary of the Stated Maturity of the
Securities shall not constitute Disqualified Stock if (1) the "asset sale" or
"change of control" provisions applicable to such Capital Stock are not more
favorable to the holders of such Capital Stock than the terms applicable to the
Securities in Sections 4.06 and 4.09 of this Indenture and (2) any such
requirement only becomes operative after compliance with such terms applicable
to the Securities, including the purchase of any Securities tendered pursuant
thereto.

     The amount of any Disqualified Stock that does not have a fixed redemption,
repayment or repurchase price will be calculated in accordance with the terms of
such Disqualified
<PAGE>

                                                                              14

Stock as if such Disqualified Stock were redeemed, repaid or repurchased on any
date on which the amount of such Disqualified Stock is to be determined pursuant
to the Indenture; provided, however, that if such Disqualified Stock could not
                  --------  -------
be required to be redeemed, repaid or repurchased at the time of such
determination, the redemption, repayment or repurchase price will be the book
value of such Disqualified Stock as reflected in the most recent financial
statements of such Person.

          "EBITDA" for any period means the sum of Consolidated Net Income, plus
the following to the extent deducted in calculating such Consolidated Net
Income:

          (1)  all income tax expense of the Company and its consolidated
     Restricted Subsidiaries,

          (2)  Consolidated Interest Expense,

          (3)  any non-recurring fees, expenses or charges related to any Equity
     Offering, Permitted Investment, acquisition or Incurrence of Indebtedness
     permitted to be Incurred by the Indenture (in each case, whether or not
     successful), including any such fees, expenses or charges related to the
     Transactions, in each case not exceeding $5.0 million in the aggregate for
     all such non-recurring fees, expenses and charges attributable to the same
     transaction or event (or group of related transactions or events),

          (4)  depreciation and amortization expense of the Company and its
     consolidated Restricted Subsidiaries (excluding amortization expense
     attributable to a prepaid operating activity item that was paid in cash in
     a prior period),

          (5)  all other non-cash losses, expenses and charges of the Company
     and its consolidated Restricted Subsidiaries (excluding any such non-cash
     loss, expense or charge to the extent that it represents an accrual of or
     reserve for cash expenditures in any future period), and

          (6)  any non-recurring charges that are incurred and associated with
     the restructuring of the operations of the Company and its consolidated
     Subsidiaries announced prior to the Issue Date and implemented within 90
     days after the Merger Date,

in each case for such period. Notwithstanding the foregoing, the provision for
taxes based on the income or
<PAGE>

                                                                              15

profits of, and the depreciation and amortization and non-cash charges of, a
Restricted Subsidiary shall be added to Consolidated Net Income to compute
EBITDA only to the extent (and in the same proportion) that the net income of
such Restricted Subsidiary was included in calculating Consolidated Net Income
and only if a corresponding amount would be permitted at the date of
determination to be dividended to the Company by such Restricted Subsidiary
without prior approval (that has not been obtained), pursuant to the terms of
its charter and all agreements, instruments, judgments, decrees, orders,
statutes, rules and governmental regulations applicable to such Restricted
Subsidiary or its stockholders.

          "Equity Offering" means any primary offering of Capital Stock of
Parent or the Company (other than Disqualified Stock)to Persons who are not
Affiliates of the Company other than (1) public offerings with respect to the
Company's Common Stock registered on Form S-8 and (2) issuances upon exercise of
options by employees of the Company or any of its Restricted Subsidiaries.

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

          "Exempt Subsidiary" means any Restricted Subsidiary that shall have
had aggregate EBITDA of less than $250,000 for the period of the most recent
four consecutive fiscal quarters for which internal financial statements are
available ending prior to the date of the issuance or sale of its Capital Stock
giving rise to such determination; provided, however, that such sale or issuance
                                   --------  -------
is pursuant to a plan or program for the sale or issuance of Capital Stock a
majority of which is sold to local management or to local strategic investors.

          "Facilities" means the Term Loan Facilities and the Revolving Credit
Facilities.

          "Foreign Restricted Subsidiary" means any Restricted Subsidiary not
incorporated or organized under the laws of the United States of America, any
State thereof or the District of Columbia.

          "Freeman Spogli" means collectively, (1) FS Equity Partners III, L.P.,
(2) FS Equity Partners International L.P., (3) any investment fund that is
affiliated with Freeman Spogli & Co. Incorporated and (4) Freeman Spogli & Co.
Incorporated and any successor entity thereof controlled by the principals of
Freeman Spogli & Co. Incorporated or
<PAGE>

                                                                              16

any entity controlled by, or under common control with, Freeman Spogli & Co.
Incorporated.

          "GAAP" means generally accepted accounting principles in the United
States of America as in effect as of the Issue Date, including those set forth
in

          (1)  the opinions and pronouncements of the Accounting Principles
     Board of the American Institute of Certified Public Accountants,

          (2)  statements and pronouncements of the Financial Accounting
     Standards Board,

          (3)  such other statements by such other entity as approved by a
     significant segment of the accounting profession and

          (4)  the rules and regulations of the SEC governing the inclusion of
     financial statements (including pro forma financial statements) in periodic
     reports required to be filed pursuant to Section 13 of the Exchange Act,
     including opinions and pronouncements in staff accounting bulletins and
     similar written statements from the accounting staff of the SEC. Except as
     otherwise provided herein, all ratios and computations based on GAAP
     contained in this Indenture shall be computed in conformity with GAAP.

          "Guarantee" means any obligation, contingent or otherwise, of any
Person directly or indirectly guaranteeing any Indebtedness of any Person and
any obligation, direct or indirect, contingent or otherwise, of such Person

          (1)  to purchase or pay (or advance or supply funds for the purchase
     or payment of) such Indebtedness of such Person (whether arising by virtue
     of partnership arrangements, or by agreements to keep-well, to purchase
     assets, goods, securities or services, to take-or-pay or to maintain
     financial statement conditions or otherwise) or

          (2)  entered into for the purpose of assuring in any other manner the
     obligee of such Indebtedness of the payment thereof or to protect such
     obligee against loss in respect thereof (in whole or in part);

provided, however, that the term "Guarantee" shall not include endorsements for
--------  -------
collection or deposit in the ordinary course of business. The term "Guarantee"
used as a verb has a corresponding meaning.
<PAGE>

                                                                              17

          "Guarantor" means Parent and/or a Subsidiary Guarantor.

          "Guaranty" means the Parent Guaranty and/or a Subsidiary Guaranty.

          "Guaranty Agreement" means a supplemental indenture, in a form
satisfactory to the Trustee, pursuant to which a Guarantor guarantees the
Company's obligations with respect to the Securities on the terms provided for
in this Indenture.

          "Hedging Obligations" of any Person means the obligations of such
Person pursuant to any Interest Rate Agreement or Currency Agreement or similar
agreement.

          "Holder" or "Securityholder" means the Person in whose name a Security
is registered on the Registrar's books.

          "Incur" means issue, assume, Guarantee, incur or otherwise become
liable for; provided, however, that any Indebtedness or Capital Stock of a
            --------  -------
Person existing at the time such Person becomes a Restricted Subsidiary (whether
by merger, consolidation, acquisition or otherwise) shall be deemed to be
Incurred by such Person at the time it becomes a Restricted Subsidiary. The term
"Incurrence" when used as a noun shall have a correlative meaning. Solely for
purposes of determining compliance with Section 4.03, (1) amortization of debt
discount or the accretion of principal with respect to a noninterest bearing or
other discount security and (2) the payment of regularly scheduled interest in
the form of additional Indebtedness of the same instrument or the payment of
regularly scheduled dividends on Capital Stock in the form of additional Capital
Stock of the same class and with the same terms will not be deemed to be the
Incurrence of Indebtedness.

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

          (1)  the principal in respect of (A) indebtedness of such Person for
     money borrowed and (B) indebtedness evidenced by notes, debentures, bonds
     or other similar instruments for the payment of which such Person is
     responsible or liable, including, in each case, any premium on such
     indebtedness to the extent such premium has become due and payable;
<PAGE>

                                                                              18

          (2)  all Capital Lease Obligations of such Person and all Attributable
     Debt in respect of Sale/Leaseback Transactions entered into by such Person;

          (3)  all obligations of such Person issued or assumed as the deferred
     purchase price of property, all conditional sale obligations of such Person
     and all obligations of such Person under any title retention agreement (but
     excluding trade accounts payable arising in the ordinary course of
     business);

          (4)  all obligations of such Person for the reimbursement of any
     obligor on any letter of credit, banker's acceptance or similar credit
     transaction (other than obligations with respect to letters of credit
     securing obligations (other than obligations described in clauses (1)
     through (3) above) entered into in the ordinary course of business of such
     Person to the extent such letters of credit are not drawn upon or, if and
     to the extent drawn upon, such drawing is reimbursed no later than the
     twentieth Business Day following payment on the letter of credit);

          (5)  the amount of all obligations of such Person with respect to the
     redemption, repayment or other repurchase of any Disqualified Stock of such
     Person or, with respect to any Preferred Stock of any Subsidiary of such
     Person, the principal amount of such Preferred Stock to be determined in
     accordance with Section 1.04(7) (but excluding, in each case, any accrued
     dividends);

          (6)  all obligations of the type referred to in clauses (1) through
     (5) of other Persons and all dividends of other Persons for the payment of
     which, in either case, such Person is responsible or liable, directly or
     indirectly, as obligor, guarantor or otherwise, including by means of any
     Guarantee;

          (7)  all obligations of the type referred to in clauses (1) through
     (6) of other Persons secured by any Lien on any property or asset of such
     Person (whether or not such obligation is assumed by such Person), the
     amount of such obligation being deemed to be the lesser of the value of
     such property or assets and the amount of the obligation so secured; and

          (8)  to the extent not otherwise included in this definition, Hedging
     Obligations of such Person.
<PAGE>

                                                                              19

Notwithstanding the foregoing, in connection with the purchase by the Company or
any Restricted Subsidiary of any business, the term "Indebtedness" will exclude
post-closing payment adjustments to which the seller may become entitled to the
extent such payment is determined by a final closing balance sheet or such
payment depends on the performance of such business after the closing; provided,
                                                                       --------
however, that, at the time of closing, the amount of any such payment is not
-------
determinable and, to the extent such payment thereafter becomes fixed and
determined, the amount is paid within 30 days thereafter. Indebtedness of any
Person shall include all Indebtedness of any partnership or other entity in
which such Person is a general partner or other equity holder with unlimited
liability other than Indebtedness which by its terms is non-recourse to such
Person and its assets.

          The amount of Indebtedness of any Person at any date shall be the
outstanding balance at such date of all unconditional obligations as described
above and the maximum liability, upon the occurrence of the contingency giving
rise to the obligation, of any contingent obligations at such date provided,
                                                                   --------
however, that the principal amount of any noninterest bearing or other discount
-------
security at any date will be the principal amount thereof that would be shown on
a balance sheet of such Person dated such date prepared in accordance with GAAP.

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

          "Independent Qualified Party" means an investment banking firm,
accounting firm or appraisal firm of national standing; provided, however, that
                                                        --------  -------
such firm is not an Affiliate of the Company.

          "Interest Rate Agreement" means in respect of a Person any interest
rate swap agreement, interest rate cap agreement or other financial agreement or
arrangement designed to protect such Person against fluctuations in interest
rates.

          "Investment" in any Person means any direct or indirect advance, loan
(other than advances to customers in the ordinary course of business that are
recorded as accounts receivable on the balance sheet of the lender) or other
extensions of credit (including by way of Guarantee or similar arrangement) or
capital contribution to (by means of any transfer of cash or other property to
others or any payment for property or services for the account or use of
others), or any purchase or acquisition of Capital Stock,
<PAGE>

                                                                              20

Indebtedness or other similar instruments issued by such Person. Except as
otherwise provided for herein, the amount of an Investment shall be its fair
market value at the time the Investment is made and without giving effect to
subsequent changes in value.

          For purposes of the definition of "Unrestricted Subsidiary", the
definition of "Restricted Payment" and Section 4.04,

          (1)  "Investment" shall include the portion (proportionate to the
     Company's equity interest in such Subsidiary) of the fair market value of
     the net assets of any Subsidiary of the Company at the time that such
     Subsidiary is designated an Unrestricted Subsidiary; provided, however,
                                                          --------  -------
     that upon a redesignation of such Subsidiary as a Restricted Subsidiary,
     the Company shall be deemed to continue to have a permanent "Investment" in
     an Unrestricted Subsidiary equal to an amount (if positive) equal to (x)
     the Company's "Investment" in such Subsidiary at the time of such
     redesignation less (y) the portion (proportionate to the Company's equity
     interest in such Subsidiary) of the fair market value of the net assets of
     such Subsidiary at the time of such redesignation; and

          (2)  any property transferred to or from an Unrestricted Subsidiary
     shall be valued at its fair market value at the time of such transfer, in
     each case as determined in good faith by the Board of Directors.

          "Investment Grade Rating" means a rating equal to or higher than Baa3
(or the equivalent) and BBB- (or the equivalent) by Moody's Investors Service,
Inc. (or any successor to the rating agency business thereof) and Standard &
Poor's Ratings Group (or any successor to the rating agency business thereof),
respectively.

          "Issue Date" means June 7, 2001.

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

          "Melody" means L.J. Melody & Company, a Texas corporation.

          "Melody Loan Arbitrage Facility" means a credit facility provided to
Melody by any depository bank in which Melody deposits payments relating to
mortgage loans for
<PAGE>

                                                                              21

which Melody is servicer prior to distribution of such payments to or for the
benefit of the holders of such loans, so long as (1) Melody applies all proceeds
of loans made under such credit facility to purchase Temporary Cash Investments
and (2) all such Temporary Cash Investments purchased by Melody with the
proceeds of loans thereunder (and proceeds thereof and distributions thereon)are
pledged to the depository bank providing such credit facility, and such bank has
a first priority perfected security interest therein, to secure loans made under
such credit facility.

          "Melody Mortgage Warehousing Facility" means the credit facility
provided by Residential Funding Corporation ("RFC") or any substantially similar
facility extended to any Mortgage Banking Subsidiary in connection with any
Mortgage Banking Activities, pursuant to which RFC or another lender makes loans
to Melody, the proceeds of which loans are applied by Melody (or any Mortgage
Banking Subsidiary) to fund commercial mortgage loans originated and owned by
Melody (or any Mortgage Banking Subsidiary) subject to an unconditional,
irrevocable (subject to customary exceptions) commitment to purchase such
mortgage loans by the Federal Home Loan Mortgage Corporation, the Federal
National Mortgage Association or any other quasi-federal governmental entity so
long as loans made by RFC or such other lender to Melody (or any Mortgage
Banking Subsidiary) thereunder are secured by a pledge of commercial mortgage
loans made by Melody (or any Mortgage Banking Subsidiary) with the proceeds of
such loans and RFC or such other lender has a perfected first priority security
interest therein, to secure loans made under such credit facility.

          "Melody Permitted Indebtedness" means Indebtedness of Melody under the
Melody Loan Arbitrage Facility, the Melody Mortgage Warehousing Facility and the
Melody Working Capital Facility and Indebtedness of any Mortgage Banking
Subsidiary under the Melody Mortgage Warehousing Facility that is, in all cases,
non-recourse to the Company or any of its other Subsidiaries.

          "Melody Working Capital Facility" means a credit facility provided by
a financial institution to Melody, so long as (1) the proceeds of loans
thereunder are applied only to provide working capital to Melody, (2) loans
under such credit facility are unsecured, and (3) the aggregate principal amount
of loans outstanding under such credit facility at no time exceeds $1.0 million.

          "Merger" means the merger of BLUM CB Corp. with and into CB Richard
Ellis Services pursuant to the Merger Agreement.
<PAGE>

                                                                              22

          "Merger Agreement" means the amended and restated agreement and plan
of merger dated as of May 31, 2001, among CB Richard Ellis Services, Parent and
Merger Sub, as such agreement may be further amended so long as such amendments
are not adverse to Holders, and all other documents entered into or delivered in
connection with the Merger Agreement.

          "Merger Date" means the date the Merger is consummated.

          "Mortgage Banking Activities" means the origination by a Mortgage
Banking Subsidiary of mortgage loans in respect of commercial and multi-family
residential real property, and the sale or assignment of such mortgage loans and
the related mortgages to another person (other than the Company or any of its
Subsidiaries) within sixty days after the origination thereof; provided,
                                                               --------
however, that in each case prior to origination of any mortgage loan, the
-------
Company or a Mortgage Banking Subsidiary, as the case may be, shall have entered
into a legally binding and enforceable purchase and sale agreement with respect
to such mortgage loan with a person that purchases such loans in the ordinary
course of business.

          "Mortgage Banking Subsidiary" means Melody and its subsidiaries that
are engaged in Mortgage Banking Activities.

          "Net Available Cash" from an Asset Disposition means cash payments
received therefrom (including any cash payments received by way of deferred
payment of principal pursuant to a note or installment receivable or otherwise
and proceeds from the sale or other disposition of any securities received as
consideration, but only as and when received, but excluding any other
consideration received in the form of assumption by the acquiring Person of
Indebtedness or other obligations relating to such properties or assets or
received in any other noncash form), in each case net of

          (1)  all legal, accounting, investment banking and brokerage fees,
     title and recording tax expenses, commissions and other fees and expenses
     incurred, and all Federal, state, provincial, foreign and local taxes
     required to be accrued as a liability under GAAP, as a consequence of such
     Asset Disposition,

          (2)  all payments made on any Indebtedness which is secured by any
     assets subject to such Asset Disposition, in accordance with the terms of
     any Lien upon or other security agreement of any kind with
<PAGE>

                                                                              23

     respect to such assets, or which must by its terms, or in order to obtain a
     necessary consent to such Asset Disposition, or by applicable law, be
     repaid out of the proceeds from such Asset Disposition,

          (3)  all distributions and other payments required to be made to
     minority interest holders in Subsidiaries or joint ventures as a result of
     such Asset Disposition and

          (4)  the deduction of appropriate amounts provided by the seller as a
     reserve, in accordance with GAAP, against any liabilities associated with
     the property or other assets disposed in such Asset Disposition and
     retained by the Company or any Restricted Subsidiary after such Asset
     Disposition.

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

          "Obligations" means with respect to any Indebtedness all obligations
for principal, premium, interest, penalties, fees, indemnifications,
reimbursements, and other amounts payable pursuant to the documentation
governing such Indebtedness.

          "Offering Circular" means the Confidential Offering Circular dated May
31, 2001, as supplemented by the Supplement dated June 6, 2001, relating to the
Securities.

          "Officer" means the Chairman of the Board, the Chief Executive
Officer, the President, the Chairman of the Americas, any Vice President, the
Chief Financial Officer, the Treasurer or the Secretary of the Company.

          "Officers' Certificate" means a certificate signed by two Officers.

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

          "Parent" means CBRE Holding, Inc.
<PAGE>

                                                                              24

          "Parent Senior Notes" means Parent's 16% Senior Notes Due 2011.

          "Parent Guaranty" means the Guarantee by Parent of the Company's
obligations with respect to the Securities contained in this Indenture.

          "Permitted Co-investment" means any Investment by any Restricted
Subsidiary which is formed solely to acquire up to 5% of the Capital Stock of
any Person (a "Co- investment Entity") managed by such Restricted Subsidiary
whose principal purpose is to invest, directly or indirectly, in commercial real
estate; provided, however, that such Restricted Subsidiary is acting in such
        --------  -------
capacity pursuant to an arrangement substantially similar to arrangements
entered into by Restricted Subsidiaries involved in such activities prior to the
Issue Date.

          "Permitted Holders" means (1) RCBA and Freeman Spogli, (2) any member
of senior management of the Company on the Merger Date and (3) DLJ Investment
Partners II, L.P. and its affiliates.

          "Permitted Investment" means an Investment by the Company or any
Restricted Subsidiary in

          (1)  the Company, a Restricted Subsidiary or a Person that will, upon
     the making of such Investment, become a Restricted Subsidiary; provided,
                                                                    --------
     however, that (A) the primary business of such Restricted Subsidiary is a
     -------
     Related Business and (B) such Restricted Subsidiary is not restricted from
     making dividends or similar distributions by contract, operation of law or
     otherwise;

          (2)  another Person if as a result of such Investment such other
     Person is merged or consolidated with or into, or transfers or conveys all
     or substantially all its assets to, the Company or a Restricted Subsidiary;
     provided, however, that such Person's primary business is a Related
     --------  -------
     Business;

          (3)  cash and Temporary Cash Investments;

          (4)  receivables owing to the Company or any Restricted Subsidiary if
     created or acquired in the ordinary course of business and payable or
     dischargeable in accordance with customary trade terms; provided, however,
                                                             --------  -------
     that such trade terms may include such concessionary trade terms as the
     Company or any
<PAGE>

                                                                              25

     such Restricted Subsidiary deems reasonable under the circumstances;

          (5)  payroll, travel, moving and similar advances to cover matters
     that are expected at the time of such advances ultimately to be treated as
     expenses for accounting purposes and that are made in the ordinary course
     of business;

          (6)  loans or advances to employees or independent contractors made in
     the ordinary course of business consistent with past practices of the
     Company or such Restricted Subsidiary;

          (7)  loans or advances to clients and vendors made in the ordinary
     course of business consistent with past practices of the Company or such
     Restricted Subsidiary in an aggregate amount outstanding at any time not
     exceeding $1.5 million;

          (8)  stock, obligations or securities received in settlement of debts
     created in the ordinary course of business and owing to the Company or any
     Restricted Subsidiary or in satisfaction of judgments;

          (9)  any Person to the extent such Investment represents the non-cash
     portion of the consideration received for an Asset Disposition as permitted
     pursuant to Section 4.06;

          (10) any Person where such Investment was acquired by the Company or
     any of its Restricted Subsidiaries (a) in exchange for any other Investment
     or accounts receivable held by the Company or any such Restricted
     Subsidiary in connection with or as a result of a bankruptcy, workout,
     reorganization or recapitalization of the issuer of such other Investment
     or accounts receivable or (b) as a result of a foreclosure by the Company
     or any of its Restricted Subsidiaries with respect to any secured
     Investment or other transfer of title with respect to any secured
     Investment in default;

          (11) Hedging Obligations entered into in the ordinary course of the
     Company's or any Restricted Subsidiary's business and not for the purpose
     of speculation;

          (12) any Person to the extent such Investment replaces or refinances
     an Investment in such Person existing on the Issue Date or on the Merger
     Date in an
<PAGE>

                                                                              26

     amount not exceeding the amount of the Investment being replaced or
     refinanced; provided, however, the new Investment is on terms and
                 --------  -------
     conditions no less favorable than the Investment being renewed or replaced;

          (13) Investments in insurance on the life of any participant in any
     deferred compensation plan of the Company made in the ordinary course of
     business consistent with past practices of the Company;

          (14) Permitted Co-investments in an aggregate amount not exceeding (a)
     for the period from the day after the Merger Date to December 31, 2001, the
     excess of $20.0 million over the aggregate amount of all such Investments
     made in the period from January 1, 2001 to the Merger Date, and (b) $20.0
     million in each calendar year thereafter; provided, however, that such
                                               --------  -------
     Investments made in Co-investment Entities investing in countries that are
     not members of the Organization for Economic Co-operation and Development
     shall not exceed $5.0 million in any calendar year; provided further,
                                                         -------- -------
     however, that (x) at the time of such Investment, no Default shall have
     -------
     occurred and be continuing (or result therefrom)and (y) immediately after
     giving pro forma effect to such Investment, the Company would be able to
     Incur an additional $1.00 of Indebtedness pursuant to Section 4.03(a); and

          (15) so long as no Default shall have occurred and be continuing (or
     result therefrom), any Person in an aggregate amount which, when added
     together with the amount of all the Investments made pursuant to this
     clause (15) which at such time have not been repaid through repayments of
     loans or advances or other transfers of assets, does not exceed $15.0
     million (with the fair market value of each Investment being measured at
     the time made and without giving effect to subsequent changes in value).

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

          "Preferred Stock", as applied to the Capital Stock of any Person,
means Capital Stock of any class or classes (however designated) which is
preferred as to the payment of dividends or distributions, or as to the
distribution of assets upon any voluntary or involuntary liquidation or
<PAGE>

                                                                              27

dissolution of such Person, over shares of Capital Stock of any other class of
such Person.

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

          "Pro Forma Cost Savings" means, with respect to any period, the
reduction in costs that were

          (1)  directly attributable to an asset acquisition and calculated on a
     basis that is consistent with Regulation S-X under the Securities Act in
     effect and applied as of the Issue Date, or

          (2)  implemented by the business that was the subject of any such
     asset acquisition within six months of the date of the asset acquisition
     and that are supportable and quantifiable by the underlying accounting
     records of such business,

as if, in the case of each of clause (1) and (2), all such reductions in costs
had been effected as of the beginning of such period.

          "Public Equity Offering" means an underwritten primary public offering
of common stock of the Company pursuant to an effective registration statement
under the Securities Act.

          "Purchase Money Indebtedness" means Indebtedness (including Capital
Lease Obligations) (1) consisting of the deferred purchase price of property,
conditional sale obligations, obligations under any title retention agreement,
other purchase money obligations and obligations in respect of industrial
revenue bonds or similar Indebtedness, in each case where the maturity of such
Indebtedness does not exceed the anticipated useful life of the asset being
financed, and (2) Incurred to finance the acquisition by the Company or a
Restricted Subsidiary of such asset, including additions and improvements;
provided, however, that any Lien arising in connection with any such
--------  -------
Indebtedness shall be limited to the specified asset being financed or, in the
case of real property or fixtures, including additions and improvements, the
real property on which such asset is attached; provided further, however, that
                                               -------- -------  -------
such Indebtedness is Incurred within 180 days after such acquisition of such
assets by the Company or any Restricted Subsidiary.
<PAGE>

                                                                              28

          "Rating Agencies" means Standard and Poor's Ratings Group and Moody's
Investors Service, Inc. or any successor to the respective rating agency
business thereof.

          "RCBA" means (1) RCBA Strategic Partners, L.P., (2) BLUM Capital
Partners, L.P. and its successors and (3) any investment fund that is affiliated
with BLUM Capital Partners, L.P. or its successors.

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

          "Refinancing Indebtedness" means Indebtedness that Refinances any
Indebtedness of the Company or any Restricted Subsidiary existing on the Merger
Date or Incurred in compliance with this Indenture, including Indebtedness that
Refinances Refinancing Indebtedness; provided, however, that:
                                     --------  -------

          (1)  such Refinancing Indebtedness has a Stated Maturity no earlier
     than the Stated Maturity of the Indebtedness being Refinanced;

          (2)  such Refinancing Indebtedness has an Average Life at the time
     such Refinancing Indebtedness is Incurred that is equal to or greater than
     the Average Life of the Indebtedness being Refinanced, and

          (3)  such Refinancing Indebtedness has an aggregate principal amount
     (or if Incurred with original issue discount, an aggregate issue price)
     that is equal to or less than the aggregate principal amount (or if
     Incurred with original issue discount, the aggregate accreted value) then
     outstanding or committed (plus fees and expenses, including any premium and
     defeasance costs) under the Indebtedness being Refinanced;

provided further, however, that Refinancing Indebtedness shall not include (A)
-------- -------  -------
Indebtedness of a Restricted Subsidiary that Refinances Indebtedness of the
Company or (B) Indebtedness of the Company or a Restricted Subsidiary that
Refinances Indebtedness of an Unrestricted Subsidiary.

          "Related Business" means any business in which the Company was engaged
on the Merger Date and any business related, ancillary or complementary to any
business of the Company in which the Company was engaged on the Merger Date.
<PAGE>

                                                                              29

          "Representative" means, with respect to a Person, any trustee, agent
or representative (if any) for an issue of Senior Indebtedness of such Person.

          "Restricted Payment" with respect to any Person means

          (1)  the declaration or payment of any dividends or any other
     distributions of any sort in respect of its Capital Stock (including any
     payment in connection with any merger or consolidation involving such
     Person) or similar payment to the direct or indirect holders of its Capital
     Stock (other than dividends or distributions payable solely in its Capital
     Stock (other than Disqualified Stock) and dividends or distributions
     payable solely to the Company or a Restricted Subsidiary, and other than
     pro rata dividends or other distributions made by a Subsidiary that is not
     a Wholly Owned Subsidiary to minority stockholders (or owners of an
     equivalent interest in the case of a Subsidiary that is an entity other
     than a corporation)),

          (2)  the purchase, redemption or other acquisition or retirement for
     value of any Capital Stock of the Company held by any Person or of any
     Capital Stock of a Restricted Subsidiary held by any Affiliate of the
     Company (other than a Restricted Subsidiary), including the exercise of any
     option to exchange any Capital Stock (other than into Capital Stock of the
     Company that is not Disqualified Stock),

          (3)  the purchase, repurchase, redemption, defeasance or other
     acquisition or retirement for value, prior to scheduled maturity, scheduled
     repayment or scheduled sinking fund payment of any Subordinated Obligations
     of such Person (other than the purchase, repurchase, or other acquisition
     of Subordinated Obligations purchased in anticipation of satisfying a
     sinking fund obligation, principal installment or final maturity, in each
     case due within one year of the date of such purchase, repurchase or other
     acquisition) or

          (4)  the making of any Investment (other than a Permitted Investment)
     in any Person.

          "Restricted Subsidiary" means any Subsidiary of the Company that is
not an Unrestricted Subsidiary.

          "Revolving Credit Facility" means the revolving credit facility
contained in the Credit Agreement and any
<PAGE>

                                                                              30

other facility or financing arrangement that Refinances, in whole or in part,
and such revolving credit facility.

          "Sale/Leaseback Transaction" means an arrangement relating to property
owned by the Company or a Restricted Subsidiary on the Issue Date or thereafter
acquired by the Company or a Restricted Subsidiary whereby the Company or a
Restricted Subsidiary transfers such property to a Person and the Company or a
Restricted Subsidiary leases it from such Person.

          "SEC" means the Securities and Exchange Commission.

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

          "Secured Indebtedness" means any Indebtedness of the Company secured
by a Lien.

          "Securities" means the Securities issued under this Indenture.

          "Senior Indebtedness" means, with respect to a Person,

          (1)  Indebtedness of such Person, whether outstanding on the Issue
     Date or thereafter Incurred, and

          (2)  accrued and unpaid interest (including interest accruing on or
     after the filing of any petition in bankruptcy or for reorganization
     relating to such Person whether or not post-filing interest is allowed in
     such proceeding) in respect of (A) indebtedness of such Person for money
     borrowed and (B) indebtedness evidenced by notes, debentures, bonds or
     other similar instruments for the payment of which such Person is
     responsible or liable

unless, in the case of clauses (1) and (2), in the instrument creating or
evidencing the same or pursuant to which the same is outstanding it is provided
that such obligations are subordinate or pari passu in right of payment to the
                                         ---- -----
Securities or the Subsidiary Guaranty of such Person, as the case may be;
provided, however, that Senior Indebtedness shall not include:
--------  -------

          (1)  any obligation of such Person to any Subsidiary;
<PAGE>

                                                                              31

          (2)  any liability for Federal, state, local or other taxes owed or
     owing by such Person,

          (3)  any accounts payable or other liability to trade creditors
     arising in the ordinary course of business (including guarantees thereof or
     instruments evidencing such liabilities),

          (4)  any Indebtedness of such Person (and any accrued and unpaid
     interest in respect thereof) which is subordinate or junior in any respect
     to any other Indebtedness or other obligation of such Person or

          (5)  that portion of any Indebtedness which at the time of Incurrence
     is Incurred in violation of this Indenture provided, however, that such
                                                --------  -------
     Indebtedness shall be deemed not to have been Incurred in violation of the
     Indenture for purposes of this clause (5) if (x) the holders of such
     Indebtedness or their representative or the Company shall have furnished to
     the Trustee an opinion of recognized independent legal counsel, unqualified
     in all material respects, addressed to the Trustee (which legal counsel
     may, as to matters of fact, rely upon an Officers' Certificate) to the
     effect that the Incurrence of such Indebtedness does not violate the
     provisions of the Indenture or (y) such Indebtedness consists of Bank
     Indebtedness, and the holders of such Indebtedness or their agent or
     representative (1) had no actual knowledge at the time of the Incurrence
     that the Incurrence of such Indebtedness violated the Indenture and (2)
     shall have received an Officers' Certificate to the effect that the
     Incurrence of such Indebtedness does not violate the provisions of the
     Indenture.

          "Senior Subordinated Indebtedness" means, with respect to a Person,
the Securities (in the case of the Company, a Guaranty (in the case of a
Guarantor) and any other Indebtedness of such Person that specifically provides
that such Indebtedness is to rank pari passu with the Securities or such
Guaranty, as the case may be; in right of payment and is not subordinated by its
terms in right of payment to any Indebtedness or other obligation of such Person
which is not Senior Indebtedness of such Person.

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

                                                                              32

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

          "Subordinated Obligation" means, with respect to a Person, any
Indebtedness of such Person (whether outstanding on the Issue Date or thereafter
Incurred) which is subordinate or junior in right of payment to the Securities
or a Guaranty of such Person, as the case may be, pursuant to a written
agreement to that effect.

          "Subsidiary" means, in respect of any Person, any corporation,
association, partnership or other business entity of which more than 50% of the
total voting power of shares of Voting Stock is at the time owned or controlled,
directly or indirectly, by (1) such Person, (2) such Person and one or more
Subsidiaries of such Person or (3) one or more Subsidiaries of such Person.

          "Subsidiary Guarantor" means each Subsidiary of the Company that
executes the Indenture as a guarantor or a Guaranty Agreement on the Merger Date
and each other Subsidiary of the Company that thereafter guarantees the
Securities pursuant to the terms of the Indenture.

          "Subsidiary Guaranty" means a Guarantee by a Subsidiary Guarantor of
the Company's obligations with respect to the Securities.

          "Temporary Cash Investments" means any of the following:

          (1)  any investment in direct obligations of the United States of
     America or any agency thereof or obligations guaranteed by the United
     States of America or any agency thereof,

          (2)  investments in time deposit accounts, bankers' acceptances,
     certificates of deposit and money market deposits maturing within one year
     of the date of acquisition thereof issued by a bank or trust company which
     is organized under the laws of the United States of America, any State
     thereof or any foreign country recognized by the United States of America,
     and which bank or trust company has capital, surplus and undivided profits
     aggregating in excess of $50,000,000
<PAGE>

                                                                              33

     (or the foreign currency equivalent thereof) and has outstanding debt that
     is rated "A" (or such similar equivalent rating) or higher by at least one
     nationally recognized statistical rating organization (as defined in Rule
     436 under the Securities Act) or any money- market fund sponsored by a
     registered broker-dealer or mutual fund distributor,

          (3)  repurchase obligations with a term of not more than 30 days for
     underlying securities of the types described in clause (1) above and
     clauses (4) and (5) below entered into with a bank meeting the
     qualifications described in clause (2) above,

          (4)  investments in commercial paper, maturing not more than one year
     from the date of creation thereof, issued by a corporation (other than an
     Affiliate of the Company) organized and in existence under the laws of the
     United States of America or any foreign country recognized by the United
     States of America with a rating at the time as of which any investment
     therein is made of "P-1" (or higher) according to Moody's Investors
     Service, Inc. or "A-1" (or higher) according to Standard and Poor's Ratings
     Group,

          (5)  investments in securities with maturities of one year or less
     from the date of acquisition issued or fully guaranteed by any state,
     commonwealth or territory of the United States of America, or by any
     political subdivision or taxing authority thereof, and rated at least "A"
     by Standard & Poor's Ratings Group or "A" by Moody's Investors Service,
     Inc., and

          (6)  other short-term investments utilized by Foreign Restricted
     Subsidiaries in accordance with normal investment practices for cash
     management in investments of a type analogous to the foregoing.

          "Term Loan Facility" means the term loan facilities contained in the
Credit Agreement and any other facilities or financing arrangements that
Refinances in whole or in part any such term loan facility.

          "TIA" means the Trust Indenture Act of 1939 (15 U.S.C.(S).(S).
                                                          ------
77aaa-77bbbb) as in effect on the date of this Indenture.

          "Transactions" shall mean, collectively, the following transactions to
occur on or prior to the Merger Date: (a) the consummation of the Merger, (b)
the execution and delivery of the Credit Agreement and the initial
<PAGE>

                                                                              34

borrowings thereunder, (c) the execution and delivery of the Indenture relating
to the Parent Senior Notes and the issuance of the Parent Senior Notes, (d) the
closing of the tender offer for and the receipt of the requisite consents in
connection with the consent solicitation in respect of CB Richard Ellis
Services' existing 8 7/8% Senior Subordinated Notes Due 2006, (e) the Cash
Equity Contribution and (f) the payment of all fees and expenses then due and
owing that are required to be paid on or prior to the Merger Date in connection
with the offering of the Securities.

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

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

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

          "Unrestricted Subsidiary" means:

          (1)  any Subsidiary of the Company that at the time of determination
     shall be designated an Unrestricted Subsidiary by the Board of Directors in
     the manner provided below; and

          (2)  any Subsidiary of an Unrestricted Subsidiary.

The Board of Directors may designate any Subsidiary of the Company (including
any newly acquired or newly formed Subsidiary of the Company) to be an
Unrestricted Subsidiary unless such Subsidiary or any of its Subsidiaries owns
any Capital Stock or Indebtedness of, or owns or holds any Lien on any property
of, the Company or any other Subsidiary of the Company that is not a Subsidiary
of the Subsidiary to be so designated; provided, however, that either (A) the
                                       --------  -------
Subsidiary to be so designated has total assets of $1,000 or less or (B) if such
Subsidiary has assets greater than $1,000, such designation would be permitted
under Section 4.04. The Board of Directors may designate any Unrestricted
Subsidiary to be a Restricted Subsidiary; provided, however, that immediately
                                          --------  -------
after giving effect to such designation (A) the Company could Incur $1.00 of
additional Indebtedness under Section 4.03(a) and (B) no Default shall have
occurred and be continuing. Any such designation by the Board of Directors shall
be evidenced to
<PAGE>

                                                                              35

the Trustee by promptly filing with the Trustee a copy of the resolution of the
Board of Directors giving effect to such designation and an Officers'
Certificate certifying that such designation complied with the foregoing
provisions.

          "U.S. Dollar Equivalent" means with respect to any monetary amount in
a currency other than U.S. dollars, at any time for determination thereof, the
amount of U.S. dollars obtained by converting such foreign currency involved in
such computation into U.S. dollars at the spot rate for the purchase of U.S.
dollars with the applicable foreign currency as published in The Wall Street
Journal in the "Exchange Rates" column under the heading "Currency Trading" on
the date two Business Days prior to such determination.

          Except as described in Section 4.03, whenever it is necessary to
determine whether the Company has complied with any covenant in this Indenture
or a Default has occurred and an amount is expressed in a currency other than
U.S. dollars, such amount will be treated as the U.S. Dollar Equivalent
determined as of the date such amount is initially determined in such currency.

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

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

          "Wholly Owned Subsidiary" means a Restricted Subsidiary all the
Capital Stock of which (other than directors' qualifying shares) is owned by the
Company or one or more Wholly Owned Subsidiaries.
<PAGE>

                                                                              36

          SECTION 1.02.  Other Definitions.
                         ------------------

                                                  Defined in
                     Term                           Section
                     ----                         ----------

     "Affiliate Transaction".................       4.08
     "Bankruptcy Law"........................       6.01
     "Blockage Notice".......................      10.03
     "Change of Control Offer"...............       4.09(b)
     "covenant defeasance option"............       8.01(b)
     "Custodian".............................       6.01
     "Event of Default"......................       6.01
     "legal defeasance option"...............       8.01(b)
     "Legal Holiday".........................      13.08
     "Offer"................................        4.07(b)
     "Offer Amount".........................        4.07(c)(2)
     "Offer Period".........................        4.07(c)(2)
     "pay the Securities"....................      10.03
     "Paying Agent"..........................       2.03
     "Payment Blockage Period"...............      10.03
     "Purchase Date"........................        4.07(c)(1)
     "Registrar".............................       2.03
     "Successor Company".....................       5.01

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

          "Commission" means the SEC;

          "indenture securities" means the Securities and each Guaranty;

          "indenture security holder" means a Securityholder;

          "indenture to be qualified" means this Indenture and each Guaranty;

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

          "obligor" on the indenture securities means the Company, Parent and
each Subsidiary Guarantor and any other obligor on the indenture securities.

          All other TIA terms used in this Indenture that are defined by the
TIA, defined by TIA reference to another
<PAGE>

                                                                              37

statute or defined by SEC rule have the meanings assigned to them by such
definitions.

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

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

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

          (3)  "or" is not exclusive;

          (4)  "including" means including without limitation;

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

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

          (7)  the principal amount of any Preferred Stock shall be (i) the
     maximum liquidation value of such Preferred Stock or (ii) the maximum
     mandatory redemption or mandatory repurchase price with respect to such
     Preferred Stock, whichever is greater; and

          (8)  all references to the date the Securities were originally issued
     shall refer to the Issue Date.

                                   ARTICLE 2

                                The Securities
                                --------------

          SECTION 2.01.  Form and Dating. The Exchange Securities, the Private
                         ---------------
Exchange Securities and the Trustee's certificate of authentication shall be
substantially in the form of Exhibit A, which is hereby incorporated in and
expressly made a part of this Indenture. The Securities may have notations,
legends or endorsements required by law, stock exchange rule, agreements to
which the Company is subject, if any, or usage (provided that any such notation,
legend or endorsement is in a form acceptable to the Company). Each Security
shall be dated the date of its authentication. The terms of the Securities set
forth in the Appendix and Exhibit A are part of the terms of this Indenture.
<PAGE>

                                                                              38

          SECTION 2.02.  Execution and Authentication. One Officer shall sign
                         -----------------------------
the Securities for the Company by manual or facsimile signature.

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

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

          The Trustee may appoint an authenticating agent reasonably acceptable
to the Company to authenticate the Securities. Unless limited by the terms of
such appointment, an authenticating agent may authenticate Securities whenever
the Trustee may do so. Each reference in this Indenture to authentication by the
Trustee includes authentication by such agent. An authenticating agent has the
same rights as any Registrar, Paying Agent or agent for service of notices and
demands.

          SECTION 2.03.  Registrar and Paying Agent. The Company shall maintain
                         --------------------------
an office or agency where Securities may be presented for registration of
transfer or for exchange (the "Registrar") and an office or agency where
Securities may be presented for payment (the "Paying Agent"). The Registrar
shall keep a register of the Securities and of their transfer and exchange. The
Company may have one or more co-registrars and one or more additional paying
agents. The term "Paying Agent" includes any additional paying agent.

          The Company shall enter into an appropriate agency agreement with any
Registrar, Paying Agent or co-registrar not a party to this Indenture, which
shall incorporate the terms of the TIA. The agreement shall implement the
provisions of this Indenture that relate to such agent. The Company shall notify
the Trustee of the name and address of any such agent. If the Company fails to
maintain a Registrar or Paying Agent, the Trustee shall act as such and shall
be entitled to appropriate compensation therefor pursuant to Section 7.07. The
Company or any Wholly Owned Subsidiary incorporated or organized within The
United States of America may act as Paying Agent, Registrar, co-registrar or
transfer agent.
<PAGE>

                                                                              39

          The Company initially appoints the Trustee as Registrar and Paying
Agent in connection with the Securities.

          SECTION 2.04.  Paying Agent To Hold Money in Trust. Prior to each due
                         -----------------------------------
date of the principal and interest on any Security, the Company shall deposit
with the Paying Agent a sum sufficient to pay such principal and interest when
so becoming due. The Company shall require each Paying Agent (other than the
Trustee) to agree in writing that the Paying Agent shall hold in trust for the
benefit of Securityholders or the Trustee all money held by the Paying Agent for
the payment of principal of or interest on the Securities and shall notify the
Trustee of any default by the Company in making any such payment. If the Company
or a Subsidiary acts as Paying Agent, it shall segregate the money held by it as
Paying Agent and hold it as a separate trust fund. The Company at any time may
require a Paying Agent to pay all money held by it to the Trustee and to account
for any funds disbursed by the Paying Agent. Upon complying with this Section,
the Paying Agent shall have no further liability for the money delivered to the
Trustee.

          SECTION 2.05.  Securityholder Lists. The Trustee shall preserve in as
                         --------------------
current a form as is reasonably practicable the most recent list available to
it of the names and addresses of Securityholders. If the Trustee is not the
Registrar, the Company shall furnish to the Trustee, in writing at least five
Business Days before each interest payment date and at such other times as the
Trustee may request in writing, a list in such form and as of such date as the
Trustee may reasonably require of the names and addresses of Securityholders.

          SECTION 2.06.  Transfer and Exchange. The Securities shall be issued
                         ---------------------
in registered form and shall be transferable only upon the surrender of a
Security for registration of transfer. When a Security is presented to the
Registrar or a co-registrar with a request to register a transfer, the Registrar
shall register the transfer as requested if the requirements of this Indenture
and Section 8-401(a) of the Uniform Commercial Code are met. When Securities are
presented to the Registrar or a co- registrar with a request to exchange them
for an equal principal amount of Securities of other denominations, the
Registrar shall make the exchange as requested if the same requirements are met.

          SECTION 2.07.  Replacement Securities. If a mutilated Security is
                         -----------------------
surrendered to the Registrar or if the Holder of a Security claims that the
Security has been lost,
<PAGE>

                                                                              40

destroyed or wrongfully taken, the Company shall issue and the Trustee shall
authenticate a replacement Security if the requirements of Section 8-405 of the
Uniform Commercial Code are met and the Holder satisfies any other reasonable
requirements of the Trustee. If required by the Trustee or the Company, such
Holder shall furnish an indemnity bond sufficient in the judgment of the Company
and the Trustee to protect the Company, the Trustee, the Paying Agent, the
Registrar and any co-registrar from any loss which any of them may suffer if a
Security is replaced. The Company and the Trustee may charge the Holder for
their expenses in replacing a Security.

          Every replacement Security is an additional obligation of the Company.

          SECTION 2.08.  Outstanding Securities. Securities outstanding at any
                         ----------------------
time are all Securities authenticated by the Trustee except for those canceled
by it, those delivered to it for cancellation and those described in this
Section as not outstanding. A Security does not cease to be outstanding because
the Company or an Affiliate of the Company holds the Security.

          If a Security is replaced pursuant to Section 2.07, it ceases to be
outstanding unless the Trustee and the Company receive proof satisfactory to
them that the replaced Security is held by a bona fide purchaser.

          If the Paying Agent segregates and holds in trust, in accordance with
this Indenture, on a redemption date or maturity date money sufficient to pay
all principal and interest payable on that date with respect to the Securities
(or portions thereof) to be redeemed or maturing, as the case may be, and the
Paying Agent is not prohibited from paying such money to the Securityholders on
that date pursuant to the terms of this Indenture, then on and after that date
such Securities (or portions thereof) cease to be outstanding and interest on
them ceases to accrue.

          SECTION 2.09.  Temporary Securities. Until definitive Securities are
                         --------------------
ready for delivery, the Company may prepare and the Trustee shall authenticate
temporary Securities. Temporary Securities shall be substantially in the form of
definitive Securities but may have variations that the Company considers
appropriate for temporary Securities. Without unreasonable delay, the Company
shall prepare and the Trustee shall authenticate definitive Securities and
deliver them in exchange for temporary Securities.
<PAGE>

                                                                              41

          SECTION 2.10.  Cancellation. The Company at any time may deliver
                         ------------
Securities to the Trustee for cancellation. The Registrar and the Paying Agent
shall forward to the Trustee any Securities surrendered to them for registration
of transfer, exchange or payment. The Trustee and no one else shall cancel and
destroy (subject to the record retention requirements of the Exchange Act) all
Securities surrendered for registration of transfer, exchange, payment or
cancellation and deliver a certificate of such destruction to the Company unless
the Company directs the Trustee to deliver canceled Securities to the Company.
The Company may not issue new Securities to replace Securities it has redeemed,
paid or delivered to the Trustee for cancellation.

          SECTION 2.11.  Defaulted Interest. If the Company defaults in a
                         ------------------
payment of interest on the Securities, the Company shall pay defaulted interest
(plus interest on such defaulted interest to the extent lawful) in any lawful
manner. The Company may pay the defaulted interest to the persons who are
Securityholders on a subsequent special record date. The Company shall fix or
cause to be fixed any such special record date and payment date to the
reasonable satisfaction of the Trustee and shall promptly mail to each
Securityholder a notice that states the special record date, the payment date
and the amount of defaulted interest to be paid.

          SECTION 2.12.  CUSIP Numbers. The Company in issuing the Securities
                         -------------
may use "CUSIP" numbers (if then generally in use) and, if so, the Trustee shall
use "CUSIP" numbers in notices of redemption as a convenience to Holders;
provided, however, that any such notice may state that no representation is made
--------  -------
as to the correctness of such numbers either as printed on the Securities or as
contained in any notice of a redemption and that reliance may be placed only on
the other identification numbers printed on the Securities, and any such
redemption shall not be affected by any defect in or omission of such numbers.

          SECTION 2.13.  Issuance of Additional Securities. The Company shall be
                         ---------------------------------
entitled, subject to its compliance with Section 4.03, to issue Additional
Securities under this Indenture which shall have identical terms as the Initial
Securities issued on the Issue Date, other than with respect to the date of
issuance and issue price. The Initial Securities issued on the Issue Date, any
Additional Securities and all Exchange Securities or Private Exchange Securities
issued in exchange therefor shall be treated as a single class for all purposes
under this Indenture.
<PAGE>

                                                                              42

          With respect to any Additional Securities, the Company shall set forth
in a resolution of the Board of Directors and an Officers' Certificate, a copy
of each which shall be delivered to the Trustee, the following information:

          (1)  the aggregate principal amount of such Additional Securities to
     be authenticated and delivered pursuant to this Indenture;

          (2)  the issue price, the issue date and the CUSIP number of such
     Additional Securities; provided, however, that no Additional Securities may
                            --------  -------
     be issued at a price that would cause such Additional Securities to have
     "original issue discount" within the meaning of Section 1273 of the Code
     (unless then applicable regulations under the Code would treat the
     outstanding Securities and the Additional Securities as part of the same
     issue); and

          (3)  whether such Additional Securities shall be Transfer Restricted
     Securities and issued in the form of Initial Securities as set forth in the
     Appendix to this Indenture or shall be issued in the form of Exchange
     Securities as set forth in Exhibit A.

                                   ARTICLE 3

                                  Redemption
                                  ----------

          SECTION 3.01.  Notices to Trustee. If the Company elects to redeem
                         ------------------
Securities pursuant to paragraph 5 of the Securities or is required to redeem
Securities pursuant to paragraph 6 of the Securities, it shall notify the
Trustee in writing of the redemption date, the principal amount of Securities to
be redeemed and the paragraph of the Securities pursuant to which the redemption
will occur.

          If the Company is required to redeem Securities pursuant to paragraph
6 of the Securities, it may reduce the accreted value of Securities required to
be redeemed to the extent it is permitted a credit by the terms of the
Securities and it notifies the Trustee of the amount of the credit and the basis
for it. If the reduction is based on a credit for redeemed or canceled
Securities that the Company has not previously delivered to the Trustee for
cancellation, it shall deliver such Securities with the notice.
<PAGE>

                                                                              43

          The Company shall give each notice to the Trustee provided for in this
Section at least 60 days before the redemption date unless the Trustee consents
to a shorter period. Such notice shall be accompanied by an Officers'
Certificate and an Opinion of Counsel from the Company to the effect that such
redemption will comply with the conditions herein.

          SECTION 3.02.  Selection of Securities To Be Redeemed. If fewer than
                         --------------------------------------
all the Securities are to be redeemed, the Trustee shall select the Securities
to be redeemed pro rata or by lot or by a method that complies with applicable
legal and securities exchange requirements, if any, and that the Trustee in its
sole discretion shall deem to be fair and appropriate and in accordance with
methods generally used at the time of selection by fiduciaries in similar
circumstances. The Trustee shall make the selection from outstanding Securities
not previously called for redemption. The Trustee may select for redemption
portions of the principal of Securities that have denominations larger than
$1,000. Securities and portions of them the Trustee selects shall be in
principal amounts of $1,000 or a whole multiple of $1,000. Provisions of this
Indenture that apply to Securities called for redemption also apply to portions
of Securities called for redemption. The Trustee shall notify the Company
promptly of the Securities or portions of Securities to be redeemed.

          SECTION 3.03.  Notice of Redemption. At least 30 days but not more
                         --------------------
than 60 days before a date for redemption of Securities (except in the case of
a redemption pursuant to paragraph 6 of the Securities, in which case, the
notice shall be mailed within the time period specified in such paragraph), the
Company shall mail a notice of redemption by first-class mail to each Holder of
Securities to be redeemed at such Holder's registered address.

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

          (1)  the redemption date;

          (2)  the redemption price;

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

          (4)  that Securities called for redemption must be surrendered to the
     Paying Agent to collect the redemption price;
<PAGE>

                                                                              44

          (5)  if fewer than all the outstanding Securities are to be redeemed,
     the identification and principal amounts of the particular Securities to
     be redeemed;

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

          (7)  the paragraph of the Securities pursuant to which the Securities
     called for redemption are being redeemed; and

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

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

          SECTION 3.04.  Effect of Notice of Redemption. Once notice of
                         ------------------------------
redemption is mailed, Securities called for redemption become due and payable on
the redemption date and at the redemption price stated in the notice. Upon
surrender to the Paying Agent, such Securities shall be paid at the redemption
price stated in the notice, plus accrued interest to the redemption date
(subject to the right of Holders of record on the relevant record date to
receive interest due on the related interest payment date). Failure to give
notice or any defect in the notice to any Holder shall not affect the validity
of the notice to any other Holder. Once notice of a redemption pursuant to
paragraph 6 of the Securities is mailed, the Company shall be entitled to redeem
the Securities pursuant to such paragraph at the redemption price provided for
therein notwithstanding the occurrence of an Event of Default after the mailing
date of such notice.

          SECTION 3.05.  Deposit of Redemption Price. Prior to the redemption
                         ---------------------------
date, the Company shall deposit with the Paying Agent (or, if the Company or a
Subsidiary is the Paying Agent, shall segregate and hold in trust) money
sufficient to pay the redemption price of and accrued interest on all
Securities to be redeemed on that date other than Securities or portions of
Securities called for redemption which have been delivered by the Company to the
Trustee for cancellation.
<PAGE>

                                                                              45

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

                                   ARTICLE 4

                                   Covenants
                                   ---------

          Following the first day that (a) the ratings assigned to the
Securities by both of the Rating Agencies are Investment Grade Ratings and (b)
no Default has occurred and is continuing under the Indenture (and
notwithstanding that the Company may later cease to have an Investment Grade
Rating from either or both Rating Agencies or default under this Indenture), the
Company and its Restricted Subsidiaries shall not be subject to Sections 4.03,
4.04, 4.05, 4.06, 4.07 and 4.08.

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

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

          SECTION 4.02.  SEC Reports. Notwithstanding that the Company may not
                         ------------
be subject to the reporting requirements of Section 13 or 15(d) of the Exchange
Act, the Company shall file with the SEC and provide the Trustee and
Securityholders within 15 days after it files them with the SEC with such annual
reports and such information, documents and other reports as are specified in
Sections 13 and 15(d) of the Exchange Act and applicable to a U.S. corporation
subject to such Sections, such information, documents and other reports to be so
filed with the SEC at the times specified for the filings of such information,
documents and reports under such Sections provided, however, that the
                                          --------  -------
<PAGE>

                                                                              46

Company shall not be so obligated to file such reports with the SEC if the SEC
does not permit such filing, in which event the Company will make available such
information to the Trustee and Securityholders within 15 days after the time the
Company would be required to file such information with the SEC if it were
subject to Section 13 or 15(d) of the Exchange Act; provided further, however,
                                                    -------- -------  -------
that (a) so long as Parent is the Guarantor of the Securities, the reports,
information and other documents required to be filed and provided as described
hereunder may, at the Company's option, be filed by and be those of Parent
rather than the Company and (b) in the event that Parent conducts any business
or holds any significant assets other than the capital stock of the Company at
the time of filing and providing any such report, information or other document
containing financial statements of Parent, Parent shall include in such report,
information or other document summarized financial information (as defined in
Rule 1-02(bb)of Regulation S-X promulgated by the SEC) with respect to the
Company.

          In addition, the Company shall furnish to the Holder of the Securities
and to prospective investors, upon the requests of such Holders, any information
required to be delivered pursuant to Rule 144A(d)(4) under the Securities Act so
long any Securities are not freely transferable under the Securities Act. The
Company also shall comply with the other provisions of TIA (S). 314(a).

          SECTION 4.03.  Limitation on Indebtedness. (a) The Company shall not,
                         --------------------------
and shall not permit any Restricted Subsidiary to, Incur, directly or
indirectly, any Indebtedness; provided, however, that the Company and its
                              --------  -------
Restricted Subsidiaries shall be entitled to Incur Indebtedness if, on the date
of such Incurrence and after giving effect thereto, no Default has occurred and
is continuing and the Consolidated Coverage Ratio exceeds 2.25 to 1 if such
Indebtedness is Incurred prior to June 1, 2003 or 2.5 to 1 if such Indebtedness
is Incurred thereafter.

          (b)  Notwithstanding the foregoing paragraph (a), the Company and the
Restricted Subsidiaries shall be entitled to Incur any or all of the following
Indebtedness:

          (1)  Indebtedness Incurred by the Company pursuant to any Revolving
     Credit Facility; provided, however, that, immediately after giving effect
                      --------  -------
     to any such Incurrence, the aggregate principal amount of all Indebtedness
     Incurred under this clause (1) and then outstanding does not exceed the
     greater of (A) $100.0 million less the sum of all principal
<PAGE>

                                                                              47

     payments with respect to such Indebtedness pursuant to Section
     4.06(a)(3)(A) and (B) 80% of the book value of the accounts receivable of
     the Company and its Restricted Subsidiaries;

          (2)  Indebtedness Incurred by the Company pursuant to any Term Loan
     Facility; provided, however, that, after giving effect to any such
               --------  -------
     Incurrence, the aggregate principal amount of all Indebtedness Incurred
     under this clause (2) and then outstanding does not exceed $225.0 million
     less the aggregate sum of all principal payments actually made from time to
     time after the Issue Date with respect to such Indebtedness (other than
     principal payments made from Refinancings thereof);

          (3)  Indebtedness owed to and held by the Company or a Restricted
     Subsidiary; provided, however, that (A) any subsequent issuance or transfer
                 --------  -------
     of any Capital Stock which results in any such Restricted Subsidiary
     ceasing to be a Restricted Subsidiary or any subsequent transfer of such
     Indebtedness (other than to the Company or a Restricted Subsidiary) shall
     be deemed, in each case, to constitute the Incurrence of such Indebtedness
     by the obligor thereon and (B) if the Company is the obligor on such
     Indebtedness, such Indebtedness is expressly subordinated to the prior
     payment in full in cash of all obligations with respect to the Securities;

          (4)  the Securities and the Exchange Securities (other than any
     Additional Securities);

          (5)  Indebtedness of CB Richard Ellis Services and its Subsidiaries
     outstanding on both the Issue Date and the Merger Date (after giving effect
     to the Transactions) (other than Indebtedness described in clause (1), (2),
     (3) or (4) of this Section 4.03(b));

          (6)  Indebtedness of a Restricted Subsidiary Incurred and outstanding
     on or prior to the date on which such Subsidiary was acquired by the
     Company (other than Indebtedness Incurred in connection with, or to provide
     all or any portion of the funds or credit support utilized to consummate,
     the transaction or series of related transactions pursuant to which such
     Subsidiary became a Subsidiary or was acquired by the Company); provided,
                                                                     --------
     however, that on the date of such acquisition and after giving effect
     -------
     thereto, the aggregate principal amount of all Indebtedness Incurred
<PAGE>

                                                                              48

     pursuant to this clause (6) and then outstanding does not exceed $10.0
     million;

          (7)  Refinancing Indebtedness in respect of Indebtedness Incurred
     pursuant to Section 4.03(a) or pursuant to clause (4), (5) or (6) of this
     Section 4.03(b) or this clause (7); provided, however, that to the extent
                                         --------  -------
     such Refinancing Indebtedness directly or indirectly Refinances
     Indebtedness of a Subsidiary Incurred pursuant to clause (6), such
     Refinancing Indebtedness shall be Incurred only by such Subsidiary;

          (8)  Hedging Obligations entered into in the ordinary course of
     business and not for the purpose of speculation;

          (9)  obligations in respect of letters of credit, performance, bid and
     surety bonds, completion guarantees, payment obligations in connection with
     self-insurance or similar requirements provided by the Company or any
     Restricted Subsidiary in the ordinary course of business;

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

          (11) any Guarantee (including the Subsidiary Guaranties) by the
     Company or a Restricted Subsidiary of Indebtedness or other obligations of
     the Company or any of its Restricted Subsidiaries so long as the Incurrence
     of such Indebtedness by the Company or such Restricted Subsidiary is
     permitted under the terms of this Indenture (other than Indebtedness
     Incurred pursuant to clause (6) above);

          (12) Indebtedness arising from agreements providing for
     indemnification, adjustment of purchase price or similar obligations, in
     each case, incurred or assumed in connection with the acquisition or
     disposition of any business, assets or a Subsidiary; provided that (A) such
                                                          --------
     Indebtedness is not reflected on the balance sheet of the Company or any
     Restricted Subsidiary (contingent obligations referred to in a footnote or
     footnotes to financial statements and not otherwise reflected on the
     balance sheet will not be deemed to be reflected on such balance sheet for
<PAGE>

                                                                              49

     purposes of this clause (A)) and (B) in the case of a disposition, the
     maximum liability in respect of such Indebtedness shall at no time exceed
     the gross proceeds including non-cash proceeds (the fair market value of
     such non-cash proceeds being determined at the time received and without
     giving effect to any subsequent changes in value) actually received by the
     Company or such Restricted Subsidiary in connection with such disposition;

          (13) Melody Permitted Indebtedness;

          (14) Purchase Money Indebtedness Incurred to finance the acquisition
     by the Company or any Restricted Subsidiary of any fixed or capital assets
     in the ordinary course of business in an aggregate principal amount which,
     when taken together with all other Indebtedness Incurred pursuant to this
     clause (14) and then outstanding, does not exceed $10.0 million;

          (15) Indebtedness of Foreign Restricted Subsidiaries in an aggregate
     principal amount which, when taken together with all other Indebtedness of
     Foreign Restricted Subsidiaries Incurred pursuant to this clause (15) and
     then outstanding, does not exceed $15.0 million; and

          (16) Indebtedness of the Company or any Restricted Subsidiary in an
     aggregate principal amount which, when taken together with all other
     Indebtedness of the Company and the Restricted Subsidiaries outstanding on
     the date of such Incurrence (other than Indebtedness permitted by clauses
     (1) through (15) of this Section 4.03(b) or Section 4.03(a)), does not
     exceed $30.0 million.

          (c)  Notwithstanding the foregoing, none of the Company or any
Restricted Subsidiary shall Incur any Indebtedness pursuant to Section 4.03(b)
if the proceeds thereof are used, directly or indirectly, to Refinance any
Subordinated Obligations of the Company or any Restricted Subsidiary unless such
Indebtedness shall be subordinated to the Securities or the applicable
Subsidiary Guaranty to at least the same extent as such Subordinated
Obligations.

          (d)  For purposes of determining compliance with this Section 4.03,
(1) in the event that an item of Indebtedness meets the criteria of more than
one of the types of Indebtedness described herein, the Company, in its sole
discretion, shall classify such item of Indebtedness at
<PAGE>

                                                                              50

the time of Incurrence and only be required to include the amount and type of
such Indebtedness in one of the above clauses (provided that any Indebtedness
originally classified as Incurred pursuant to clause (b)(16) above may later be
reclassified as having been Incurred pursuant to paragraph (a) above to the
extent that such reclassified Indebtedness could be Incurred pursuant to
paragraph (a) above at the time of such reclassification) and (2) the Company
shall be entitled to divide and classify an item of Indebtedness in more than
one of the types of Indebtedness described herein.

          (e)  Notwithstanding Section 4.03(a) or 4.03(b), none of the Company,
Parent and any Restricted Subsidiary shall Incur (1) any Indebtedness if such
Indebtedness is subordinate or junior in ranking in any respect to any Senior
Indebtedness of such Person, unless such Indebtedness is Senior Subordinated
Indebtedness of such Person or is expressly subordinated in right of payment to
Senior Subordinated Indebtedness of such Person or (2) any Secured Indebtedness
that is not Senior Indebtedness of such Person unless contemporaneously
therewith such Person makes effective provision to secure the Securities or
applicable Guaranty equally and ratably with such Secured Indebtedness for so
long as such Secured Indebtedness is secured by a Lien.

          (f)  For purposes of determining compliance with any U.S. dollar
restriction on the Incurrence of Indebtedness where the Indebtedness Incurred is
denominated in a different currency, the amount of such Indebtedness will be the
U.S. Dollar Equivalent determined on the date of the Incurrence of such
Indebtedness, provided, however, that if any such Indebtedness denominated in a
              --------  -------
different currency is subject to a Currency Agreement with respect to U.S.
dollars covering all principal, premium, if any, and interest payable on such
Indebtedness, the amount of such Indebtedness expressed in U.S. dollars will be
as provided in such Currency Agreement. The principal amount of any Refinancing
Indebtedness Incurred in the same currency as the Indebtedness being Refinanced
will be the U.S. Dollar Equivalent of the Indebtedness Refinanced, except to the
extent that (1) such U.S. Dollar Equivalent was determined based on a Currency
Agreement, in which case the Refinancing Indebtedness will be determined in
accordance with the preceding sentence, and (2) the principal amount of the
Refinancing Indebtedness exceeds the principal amount of the Indebtedness being
Refinanced, in which case the U.S. Dollar Equivalent of such excess will be
determined on the date such Refinancing Indebtedness is Incurred.
<PAGE>

                                                                              51

          SECTION 4.04.  Limitation on Restricted Payments. (a) The Company
                         ----------------------------------
shall not, and shall not permit any Restricted Subsidiary, directly or
indirectly, to make a Restricted Payment if at the time the Company or such
Restricted Subsidiary makes such Restricted Payment:

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

          (2)  the Company is not entitled to Incur an additional $1.00 of
     Indebtedness under Section 4.03(a); or

          (3)  the aggregate amount of such Restricted Payment and all other
     Restricted Payments since the Issue Date would exceed the sum of (without
     duplication):

               (A)  50% of the Consolidated Net Income accrued during the period
          (treated as one accounting period) from the Merger Date to the end of
          the most recent fiscal quarter ended for which internal financial
          statements are available prior to the date of such Restricted Payment
          (or, in case such Consolidated Net Income shall be a deficit, minus
          100% of such deficit); plus
                                 ----

               (B)  100% of the aggregate Net Cash Proceeds received by the
          Company from the issuance or sale of its Capital Stock (other than
          Disqualified Stock) subsequent to the Issue Date (other than an
          issuance or sale to a Subsidiary of the Company and other than an
          issuance or sale to an employee stock ownership plan or to a trust
          established by the Company or any of its Subsidiaries for the benefit
          of their employees) and 100% of any cash capital contribution received
          by the Company from its shareholders subsequent to the Issue Date;
          plus
          ----

               (C)  the amount by which Indebtedness of the Company is reduced
          on the Company's balance sheet upon the conversion or exchange (other
          than by a Subsidiary of the Company) subsequent to the Issue Date of
          any Indebtedness of the Company convertible or exchangeable for
          Capital Stock (other than Disqualified Stock) of the Company (less the
          amount of any cash, or the fair value of any other property,
          distributed by the Company upon such conversion or exchange); plus
                                                                        ----
<PAGE>

                                                                              52

               (D)  an amount equal to the sum of (x) the net reduction in the
          Investments (other than Permitted Investments) made by the Company or
          any Restricted Subsidiary in any Person resulting from repurchases,
          repayments or redemptions of such Investments by such Person, proceeds
          realized on the sale of such Investment and proceeds representing the
          return of capital (excluding dividends and distributions), in each
          case received by the Company or any Restricted Subsidiary and (y) to
          the extent such Person is an Unrestricted Subsidiary, the portion
          (proportionate to the Company's equity interest in such Subsidiary) of
          the fair market value of the net assets of such Unrestricted
          Subsidiary at the time such Unrestricted Subsidiary is designated a
          Restricted Subsidiary; provided, however, that the foregoing sum shall
                                 --------  -------
          not exceed, in the case of any such Person or Unrestricted Subsidiary,
          the amount of Investments (excluding Permitted Investments) previously
          made (and treated as a Restricted Payment) by the Company or any
          Restricted Subsidiary in such Person or Unrestricted Subsidiary.

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

          (1)  any Restricted Payment made out of the Net Cash Proceeds of the
     substantially concurrent sale of, or made by exchange for, Capital Stock of
     the Company (other than Disqualified Stock and other than Capital Stock
     issued or sold to a Subsidiary of the Company or an employee stock
     ownership plan or to a trust established by the Company or any of its
     Subsidiaries for the benefit of their employees) or a substantially
     concurrent cash capital contribution received by the Company from its
     shareholders; provided, however, that (A) such Restricted Payment shall be
                   --------  -------
     excluded in the calculation of the amount of Restricted Payments and (B)
     the Net Cash Proceeds from such sale or such cash capital contribution (to
     the extent so used for such Restricted Payment) shall be excluded from the
     calculation of amounts under Section 4.04(a)(3)(B);

          (2)  any purchase, repurchase, redemption, defeasance or other
     acquisition or retirement for value of Subordinated Obligations of the
     Company or a Restricted Subsidiary made by exchange for, or out of the
     proceeds of the substantially concurrent sale of, Indebtedness which is
     permitted to be Incurred pursuant
<PAGE>

                                                                              53

     to Section 4.03; provided, however, that such purchase, repurchase,
                      --------  -------
     redemption, defeasance or other acquisition or retirement for value shall
     be excluded in the calculation of the amount of Restricted Payments;

          (3)  dividends paid within 60 days after the date of declaration
     thereof if at such date of declaration such dividend would have complied
     with this Section 4.04; provided, however, that such dividend shall be
                             --------  -------
     included in the calculation of the amount of Restricted Payments;

          (4)  repurchases of Capital Stock of Parent required under the
     Company's 401(k) plan as it existed as of the Merger Date; provided,
                                                                --------
     however, that such repurchases shall be excluded from the calculation of
     -------
     the amount of Restricted Payments;

          (5)  so long as no Default has occurred and is continuing, the
     repurchase or other acquisition of shares of Capital Stock of Parent or the
     Company or any of the Company's Subsidiaries from employees (including
     substantially full-time independent contractors), former employees,
     directors, former directors or consultants of the Company or any of its
     Subsidiaries (or permitted transferees of such employees, former employees,
     directors, former directors or consultants), pursuant to the terms of the
     agreements (including employment agreements)or plans (or amendments
     thereto)approved by the Board of Directors under which such individuals
     purchase or sell or are granted the option to purchase or sell, shares of
     such Capital Stock; provided, however, that the aggregate amount of such
                         --------  -------
     repurchases and other acquisitions shall not exceed the sum of (A) $5.0
     million, (B) the Net Cash Proceeds from the sale of Capital Stock to
     members of management, consultants or directors of the Company and its
     Subsidiaries that occurs after the Merger Date (to the extent the Net Cash
     Proceeds from the sale of such Capital Stock have not otherwise been
     applied to the payment of Restricted Payments by virtue of clause (3)(B) of
     paragraph (a) above) and (C) the cash proceeds of any "key man" life
     insurance policies that are used to make such repurchases; provided
                                                                --------
     further, however, that (x) such repurchases and other acquisitions shall be
     -------  -------
     excluded in the calculation of the amount of Restricted Payments and (y)
     the Net Cash Proceeds from such sale shall be excluded from the calculation
     of amounts under clause (3)(B) of paragraph (a) above;
<PAGE>

                                                                              54

          (6)  Investments made by Melody in connection with the Melody Loan
     Arbitrage Facility or the Melody Mortgage Warehousing Facility; provided,
                                                                     --------
     however, that such Investments shall be excluded in the calculation of the
     -------
     amount of Restricted Payments;

          (7)  payments required pursuant to the terms of the Merger Agreement
     to consummate the Merger; provided, however, that such payments shall be
                               --------  -------
     excluded in the calculation of the amount of Restricted Payments;

          (8)  dividends to Parent to be used by Parent solely to pay its
     franchise taxes and other fees required to maintain its corporate existence
     and to pay for general corporate and overhead expenses (including salaries
     and other compensation of the employees)incurred by Parent in the ordinary
     course of its business; provided, however, that such dividends shall not
                             --------  -------
     exceed $1.0 million in any calendar year; provided further, however, that
                                               -------- -------  -------
     such dividends shall be excluded in the calculation of the amount of
     Restricted Payments;

          (9)  payments to Parent in respect of Federal, state and local taxes
     directly attributable to (or arising as a result of) the operations of the
     Company and its consolidated Subsidiaries; provided, however, that the
                                                --------  -------
     amount of such payments in any fiscal year do not exceed the amount that
     the Company and its consolidated Subsidiaries would be required to pay in
     respect of Federal, state and local taxes for such fiscal year were the
     Company to pay such taxes as a stand-alone taxpayer (whether or not all
     such amounts are actually used by Parent for such purposes); provided
                                                                  --------
     further, however, that such payments shall be excluded in the calculation
     -------  -------
     of the amount of Restricted Payments; and

          (10) Restricted Payments in an aggregate amount which, when taken
     together with all Restricted Payments made pursuant to this clause (10)
     which have not been repaid, does not exceed $20.0 million; provided,
                                                                --------
     however, that (A) at the time of such Restricted Payments, no Default shall
     -------
     have occurred and be continuing (or result therefrom) and (B) such
     Restricted Payments shall be excluded in the calculation of the amount of
     Restricted Payments.

          SECTION 4.05.  Limitation on Restrictions on Distributions from
                         ------------------------------------------------
Restricted Subsidiaries. The Company shall not, and shall not permit any
------------------------
Restricted Subsidiary
<PAGE>

                                                                              55

to, create or otherwise cause or permit to exist or become effective any
consensual encumbrance or restriction on the ability of any Restricted
Subsidiary to (a) pay dividends or make any other distributions on its Capital
Stock to the Company or a Restricted Subsidiary or pay any Indebtedness owed to
the Company, (b) make any loans or advances to the Company or (c) transfer any
of its property or assets to the Company, except:

          (1)  with respect to clauses (a), (b) and (c),

          (A)  any encumbrance or restriction pursuant to an agreement of CB
     Richard Ellis Services or any of its Subsidiaries in effect at or entered
     into on the Issue Date or, in the case of the Credit Agreement, as in
     effect on the Merger Date;

          (B)  any encumbrance or restriction contained in the terms of any
     Indebtedness Incurred pursuant to Section 4.03(b)(15) or any agreement
     pursuant to which such Indebtedness was issued if (x) either (i) the
     encumbrance or restriction applies only in the event of and during the
     continuance of a payment default or a default with respect to a financial
     covenant contained in such Indebtedness or agreement or (ii) the Company
     determines at the time any such Indebtedness is Incurred (and at the time
     of any modification of the terms of any such encumbrance or restriction)
     that any such encumbrance or restriction will not materially affect the
     Company's ability to make principal or interest payments on the Securities
     and (y) the encumbrance or restriction is not materially more
     disadvantageous to the Holders than is customary in comparable financings
     or agreements (as determined by the Board of Directors in good faith);

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

          (D)  any encumbrance or restriction pursuant to an agreement effecting
     a Refinancing of Indebtedness
<PAGE>

                                                                              56

     Incurred pursuant to an agreement referred to in Section 4.05(1) (A), (B)
     or (C) or this clause (D) or contained in any amendment to an agreement
     referred to in Section 4.05(1)(A), (B) or (C) or this clause (D); provided,
                                                                       --------
     however, that the encumbrances and restrictions with respect to such
     -------
     Restricted Subsidiary contained in any such refinancing agreement or
     amendment are no less favorable to the Securityholders than encumbrances
     and restrictions with respect to such Restricted Subsidiary contained in
     such predecessor agreements; and

          (E)  any encumbrance or restriction pursuant to applicable law; and

          (2)  with respect to clause (c) only,

          (A)  any such encumbrance or restriction consisting of customary non-
     assignment provisions in leases governing leasehold interests to the extent
     such provisions restrict the transfer of the lease or the property leased
     thereunder;

          (B)  restrictions contained in security agreements or mortgages
     securing Indebtedness of a Restricted Subsidiary to the extent such
     restrictions restrict the transfer of the property subject to such security
     agreements or mortgages;

          (C)  restrictions on the transfer of assets subject to any Lien
     permitted under this Indenture imposed by the holder of such Lien; and

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

          SECTION 4.06.  Limitation on Sales of Assets and Subsidiary Stock. (a)
                         --------------------------------------------------
The Company shall not, and shall not permit any Restricted Subsidiary to,
directly or indirectly, consummate any Asset Disposition unless (1) the Company
or such Restricted Subsidiary receives consideration at the time of such Asset
Disposition at least equal to the fair market value (including as to the value
of all non-cash consideration), as determined in good faith by the Board of
Directors, of the shares and assets subject to such Asset Disposition; (2) at
least 80% of the consideration thereof received by the Company or such
Restricted Subsidiary is in
<PAGE>

                                                                              57

the form of cash or cash equivalents; and (3) an amount equal to 100% of the Net
Available Cash from such Asset Disposition is applied by the Company (or such
Restricted Subsidiary, as the case may be) (A) first, to the extent the Company
                                               -----
elects (or is required by the terms of any Indebtedness), to prepay, repay,
redeem or purchase Senior Indebtedness of the Company or a Subsidiary Guarantor
or Indebtedness (other than any Disqualified Stock) of any other Wholly Owned
Subsidiary (in each case other than Indebtedness owed to the Company or an
Affiliate of the Company) within one year from the later of the date of such
Asset Disposition or the receipt of such Net Available Cash; (B) second, to the
                                                                 ------
extent of the balance of such Net Available Cash after application in accordance
with clause (A), to the extent the Company elects, to acquire Additional Assets
within one year from the later of the date of such Asset Disposition or the
receipt of such Net Available Cash; and (C) third, to the extent of the balance
                                            -----
of such Net Available Cash after application in accordance with clauses (A) and
(B), to make an Offer to the holders of the Securities (and to holders of other
Senior Subordinated Indebtedness of the Company designated by the Company) to
purchase Securities (and such other Senior Subordinated Indebtedness of the
Company) pursuant to and subject to the conditions of Section 4.06(b); provided,
                                                                       --------
however, that in connection with any prepayment, repayment or purchase of
-------
Indebtedness pursuant to clause (A) or (C) above, the Company or such Restricted
Subsidiary shall permanently retire such Indebtedness and shall cause the
related loan commitment (if any) to be permanently reduced in an amount equal to
the principal amount so prepaid, repaid or purchased. Notwithstanding the
foregoing provisions of this Section 4.06, the Company and the Restricted
Subsidiaries shall not be required to apply any Net Available Cash in accordance
with this Section 4.06(a) except to the extent that the aggregate Net Available
Cash from all Asset Dispositions which is not applied in accordance with this
Section 4.06(a) exceeds $10.0 million. Pending application of Net Available Cash
pursuant to this Section 4.06(a), such Net Available Cash shall be invested in
Temporary Cash Investments or applied to temporarily reduce revolving credit
indebtedness.

          For the purposes of this Section 4.06(a), the following are deemed to
be cash or cash equivalents: (1) the assumption of Indebtedness of the Company
or any Restricted Subsidiary and the release of the Company or such Restricted
Subsidiary from all liability on such Indebtedness in connection with such Asset
Disposition and (2) securities received by the Company or any Restricted
<PAGE>

                                                                              58

Subsidiary from the transferee that are promptly converted by the Company or
such Restricted Subsidiary into cash.

          (b)  In the event of an Asset Disposition that requires the purchase
of Securities (and other Senior Subordinated Indebtedness of the Company)
pursuant to Section 4.06(a)(3)(C), the Company shall purchase Securities
tendered pursuant to an offer by the Company for the Securities (and such other
Senior Subordinated Indebtedness of the Company) (the "Offer") at a purchase
price of 100% of their principal amount (or, in the event such other Senior
Subordinated Indebtedness of the Company was issued with significant original
issue discount, 100% of the accreted value thereof), without premium, plus
accrued but unpaid interest (or, in respect of such other Senior Subordinated
Indebtedness, such lesser price, if any, as may be provided for by the terms of
such Senior Subordinated Indebtedness of the Company) in accordance with the
procedures (including prorating in the event of over-subscription) set forth in
Section 4.06(c). If the aggregate purchase price of Securities (and any other
Senior Subordinated Indebtedness of the Company) tendered pursuant to the Offer
exceeds the Net Available Cash allotted to their purchase, the Company shall
select the Securities and other Senior Subordinated Indebtedness to be purchased
on a pro rata basis but in round denominations, which in the case of the
Securities will be denominations of $1,000 principal amount or multiples
thereof. The Company shall not be required to make an Offer to purchase
Securities (and other Senior Subordinated Indebtedness of the Company) pursuant
to this Section 4.06 if the Net Available Cash available therefor is less than
$10.0 million (which lesser amount shall be carried forward for purposes of
determining whether such an Offer is required with respect to the Net Available
Cash from any subsequent Asset Disposition).

          (c)  (1)  Promptly, and in any event within 10 days after the Company
becomes obligated to make an Offer, the Company shall deliver to the Trustee and
send, by first-class mail to each Holder, a written notice stating that the
Holder may elect to have his Securities purchased by the Company either in whole
or in part (subject to prorating as described in Section 4.06(b) in the event
the Offer is oversubscribed) in integral multiples of $1,000 of principal
amount, at the applicable purchase price. The notice shall specify a purchase
date not less than 30 days nor more than 60 days after the date of such notice
(the "Purchase Date") and shall contain such information concerning the business
of the Company which the Company in good faith believes will enable such Holders
to make an informed decision (which at a minimum will include (A) the most
recently filed Annual
<PAGE>

                                                                              59

Report on Form 10-K (including audited consolidated financial statements) of the
Company, the most recent subsequently filed Quarterly Report on Form 10-Q and
any Current Report on Form 8-K of the Company filed subsequent to such Quarterly
Report, other than Current Reports describing Asset Dispositions otherwise
described in the offering materials (or corresponding successor reports), (B) a
description of material developments in the Company's business subsequent to the
date of the latest of such Reports, and (C) if material, appropriate pro forma
financial information) and all instructions and materials necessary to tender
Securities pursuant to the Offer, together with the information contained in
clause (3).

          (2)  Not later than the date upon which written notice of an Offer is
delivered to the Trustee as provided below, the Company shall deliver to the
Trustee an Officers' Certificate as to (A) the amount of the Offer (the "Offer
Amount"), including information as to any other Senior Subordinated Indebtedness
included in the Offer, (B) the allocation of the Net Available Cash from the
Asset Dispositions pursuant to which such Offer is being made and (C) the
compliance of such allocation with the provisions of Section 4.06(a) and (b). On
such date, the Company shall also irrevocably deposit with the Trustee or with a
Paying Agent (or, if the Company is acting as its own Paying Agent, segregate
and hold in trust) in Temporary Cash Investments, maturing on the last day prior
to the Purchase Date or on the Purchase Date if funds are immediately available
by open of business, an amount equal to the Offer Amount to be held for payment
in accordance with the provisions of this Section. If the Offer includes other
Senior Subordinated Indebtedness, the deposit described in the preceding
sentence may be made with any other paying agent pursuant to arrangements
satisfactory to the Trustee. Upon the expiration of the period for which the
Offer remains open (the "Offer Period"), the Company shall deliver to the
Trustee for cancellation the Securities or portions thereof which have been
properly tendered to and are to be accepted by the Company. The Trustee shall,
on the Purchase Date, mail or deliver payment (or cause the delivery of payment)
to each tendering Holder in the amount of the purchase price. In the event that
the aggregate purchase price of the Securities delivered by the Company to the
Trustee is less than the Offer Amount applicable to the Securities, the Trustee
shall deliver the excess to the Company immediately after the expiration of the
Offer Period for application in accordance with this Section 4.06.

          (3)  Holders electing to have a Security purchased shall be required
to surrender the Security, with an appro-
<PAGE>

                                                                              60

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

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

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

          SECTION 4.07.  Limitation on Affiliate Transactions. (a) The Company
                         ------------------------------------
shall not, and shall not permit any Restricted Subsidiary to, enter into or
permit to exist any transaction (including the purchase, sale, lease or exchange
of any property, employee compensation arrangements or the rendering of any
service) with, or for the benefit of, any Affiliate of the Company (an
"Affiliate Transaction") unless (1) the terms thereof are no less favorable to
the Company or such Restricted Subsidiary than those that could be obtained at
the time of such Affiliate Transaction in arm's-length dealings with a Person
who is not such an Affiliate; (2) if such Affiliate Transaction involves an
amount in excess of $2.5 million, the terms of the Affiliate Transaction are set
forth in writing and a majority of the directors of the Company disinterested
with respect to such Affiliate Transaction have determined in
<PAGE>

                                                                              61

good faith that the criteria set forth in clause (1) are satisfied and have
approved the relevant Affiliate Transaction as evidenced by a resolution of the
Board of Directors; and (3) if such Affiliate Transaction involves an amount in
excess of $10.0 million, the Board of Directors shall also have received a
written opinion from an Independent Qualified Party to the effect that such
Affiliate Transaction is fair, from a financial standpoint, to the Company and
its Restricted Subsidiaries or is not less favorable to the Company and its
Restricted Subsidiaries than could reasonably be expected to be obtained at the
time in an arm's-length transaction with a Person who was not an Affiliate.

          (b)  The provisions of Section 4.07(a) shall not prohibit (1) any
Investment (other than a Permitted Investment) or other Restricted Payment, in
each case permitted to be made pursuant to Section 4.04; (2) any issuance of
securities, or other payments, awards or grants in cash, securities or otherwise
pursuant to, or the funding of, employment arrangements, stock options and stock
ownership plans approved by the Board of Directors; (3) loans or advances to
employees or consultants in the ordinary course of business of the Company or
its Restricted Subsidiaries, but in any event not to exceed $3.0 million in the
aggregate outstanding at any one time; (4) the payment of reasonable fees and
compensation to, or the provision of employee benefit arrangements and indemnity
for the benefit of, directors, officers, employees and consultants of the
Company and its Restricted Subsidiaries in the ordinary course of business; (5)
any transaction between or among the Company, any Restricted Subsidiary or joint
venture or similar entity which would constitute an Affiliate Transaction solely
because the Company or a Restricted Subsidiary owns an equity interest in or
otherwise controls such Restricted Subsidiary, joint venture or similar entity;
(6) the issuance or sale of any Capital Stock (other than Disqualified Stock) of
the Company; (7) the existence of, or the performance by the Company or any of
its Restricted Subsidiaries of its obligations under the terms of any
stockholders agreement (including any registration rights agreement or purchase
agreement related thereto) or warrant agreement to which it is a party as of the
Merger Date and any similar agreements which it may enter into thereafter;
provided, however, that the existence of, or the performance by the Company or
--------  -------
any of its Restricted Subsidiaries of obligations under any future amendment to
any such existing agreement or under any similar agreement entered into after
the Merger Date shall only be permitted by this clause (7) to the extent that
the terms of any such amendment or new agreement are not otherwise
disadvantageous to the Holders
<PAGE>

                                                                              62

in any material respect; (8) the payment of fees and other expenses to be paid
by Parent, the Company or any of its Subsidiaries in connection with the Merger;
(9) any agreement as in effect on the Merger Date and described in the Offering
Circular or any renewals, extensions or amendments of any such agreement (so
long as such renewals, extensions or amendments are not less favorable to the
Company or the Restricted Subsidiaries)and the transactions evidenced thereby;
and (10) transactions with customers, clients, suppliers or purchasers or
sellers of goods or services in each case in the ordinary course of business and
otherwise in compliance with the terms of the applicable Indenture which are
fair to the Company or its Restricted Subsidiaries, in the reasonable
determination of the Board of Directors of the Company or the senior management
thereof, or are on terms at least as favorable as might reasonably have been
obtained at such time from an unaffiliated party.

          SECTION 4.08.  Limitation on the Sale or Issuance of Capital Stock of
                         ------------------------------------------------------
Restricted Subsidiaries. The Company (1) shall not, and shall not permit any
------------------------
Restricted Subsidiary to, sell, lease, transfer or otherwise dispose of any
Capital Stock of any Restricted Subsidiary to any Person (other than to the
Company or a Wholly Owned Subsidiary), and (2) shall not permit any Restricted
Subsidiary to issue any of its Capital Stock (other than, if necessary, shares
of its Capital Stock constituting directors' or other legally required
qualifying shares) to any Person (other than the Company or a Wholly Owned
Subsidiary) unless (A) immediately after giving effect to such issuance, sale or
other disposition, neither the Company nor any of its Subsidiaries owns any
Capital Stock of such Restricted Subsidiary or (B) immediately after giving
effect to such issuance, sale or other disposition, such Restricted Subsidiary
would no longer constitute a Restricted Subsidiary and any Investment in such
Person (other than in the case of an Exempt Subsidiary) remaining after giving
effect thereto is treated as a new Investment by the Company and such Investment
would have been permitted to be made under Section 4.04 if made on the date of
such issuance, sale or other disposition.

          SECTION 4.09.  Change of Control. (a) Upon the occurrence of a Change
                         ------------------
of Control, each Holder shall have the right to require that the Company
purchase such Holder's Securities at a purchase price in cash equal to 101% of
the principal amount thereof on the date of purchase plus accrued and unpaid
interest, if any, to the date of purchase (subject to the right of holders of
record on the relevant record date to receive interest due on the relevant
interest
<PAGE>

                                                                              63

payment date), in accordance with the terms contemplated in Section 4.09(b). In
the event that at the time of such Change of Control the terms of the Credit
Agreement prohibit the Company from making a Change of Control Offer or from
purchasing Securities pursuant thereto, then prior to the mailing of the notice
to Holders provided for in Section 4.09(b) below but in any event within 30 days
following any Change of Control, the Company shall (1) repay in full all
indebtedness outstanding under the Credit Agreement offer to repay in full all
such indebtedness and repay the indebtedness of each lender who has accepted
such offer or (ii) obtain the requisite consent under the Credit Agreement to
permit the repurchase of the Securities as provided for in Section 4.09(b).

          (b)  Within 30 days following any Change of Control, unless the
Company has exercised its option to redeem all the Securities pursuant to
paragraph 6 of the Securities the Company shall mail a notice to each Holder
with a copy to the Trustee (the "Change of Control Offer") stating:

          (1)  that a Change of Control has occurred and that such Holder has
     the right to require the Company to purchase such Holder's Securities at a
     purchase price in cash equal to 101% of the principal amount thereof on the
     date of purchase plus accrued and unpaid interest, if any, to the date of
     purchase (subject to the right of Holders of record on the relevant record
     date to receive interest on the relevant interest payment date);

          (2)  the circumstances and relevant facts regarding such Change of
     Control (including information with respect to pro forma historical income,
     cash flow and capitalization, in each case after giving effect to such
     Change of Control);

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

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

          (c)  Holders electing to have a Security purchased will be required to
surrender the Security, with an appropriate form duly completed, to the Company
at the address specified in the notice at least three Business Days prior to the
purchase date. Holders will be entitled to withdraw
<PAGE>

                                                                              64

their election if the Trustee or the Company receives not later than one
Business Day prior to the purchase date, a telegram, telex, facsimile
transmission or letter setting forth the name of the Holder, the principal
amount of the Security which was delivered for purchase by the Holder and a
statement that such Holder is withdrawing his election to have such Security
purchased.

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

          (e)  Notwithstanding the foregoing provisions of this Section, the
Company shall not be required to make a Change of Control Offer upon a Change of
Control if a third party makes the Change of Control Offer in the manner, at the
times and otherwise in compliance with the requirements set forth in this
Section applicable to a Change of Control Offer made by the Company and
purchases all Securities validly tendered and not withdrawn under such Change of
Control Offer or if the Company has exercised its option to redeem all the
Securities pursuant to paragraph 6 of the Securities.

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

          SECTION 4.10.  Future Guarantors. On the Merger Date, the Company
                         ------------------
shall cause each of its Restricted Subsidiaries that is a guarantor under the
Credit Agreement to execute and deliver to the Trustee a Guaranty Agreement
pursuant to which such Restricted Subsidiary shall Guarantee the Company's
obligations with respect to the Securities on the terms set forth therein. After
the Merger Date, the Company shall cause each Restricted Subsidiary that
Guarantees any Indebtedness of the Company to, at the same time, execute and
deliver to the Trustee a Guaranty Agreement pursuant to which such Restricted
Subsidiary shall Guarantee the Company's obligations with respect to the
Securities on the terms set forth herein.
<PAGE>

                                                                              65

          SECTION 4.11.  Compliance Certificate. The Company shall deliver to
                         -----------------------
the Trustee within 120 days after the end of each fiscal year of the Company an
Officers' Certificate stating that in the course of the performance by the
signers of their duties as Officers of the Company they would normally have
knowledge of any Default and whether or not the signers know of any Default that
occurred during such period. If they do, the certificate shall describe the
Default, its status and what action the Company is taking or proposes to take
with respect thereto. The Company also shall comply with TIA ss. 314(a)(4).

          SECTION 4.12.  Payment of Additional Interest. If additional interest
                         -------------------------------
is payable by the Company pursuant to the Registration Rights Agreement and
paragraph 1 of the Securities, the Company shall deliver to the Trustee a
certificate to that effect stating (i) the amount of such additional interest
that is payable and (ii) the date on which such interest is payable. Unless and
until the Trustee receives such a certificate, the Trustee may assume without
inquiry that no Registration Default (as defined in the Registration Rights
Agreement) exists and that no additional interest is owed by the Company. If the
Company has paid additional interest directly to the persons entitled to such
interest, the Company shall deliver to the Trustee a certificate setting forth
the particulars of such payment.

          SECTION 4.13.  Further Instruments and Acts. Upon request of the
                         ----------------------------
Trustee, the Company will execute and deliver such further instruments and do
such further acts as may be reasonably necessary or proper to carry out more
effectively the purpose of this Indenture.

                                   ARTICLE 5

                           Merger and Consolidation
                           -------------------------

          Following the first day that (a) the ratings assigned to the Notes by
both of the Rating Agencies are Investment Grade Ratings and (b) no Default has
occurred and is continuing under this Indenture (and notwithstanding that the
Company may later cease to have an Investment Grade Rating from either or both
Rating Agencies or default under the Indenture), the Company shall not be
subject to clause (3) of Section 5.01(a).

          SECTION 5.01.  When Company, Subsidiary Guarantors and Parent May
                         --------------------------------------------------
Merge or Transfer Assets. (a) The Company shall not consolidate with or merge
--------------------------
with or into, or convey,
<PAGE>

                                                                              66

transfer or lease, in one transaction or a series of transactions, directly or
indirectly, all or substantially all its assets to, any Person, unless:

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

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

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

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

provided, however, that clause (3) shall not be applicable to (A) a Restricted
--------  -------
Subsidiary consolidating with, merging into or transferring all or part of its
properties and assets to the Company or (B) the Company merging with an
Affiliate of the Company solely for the purpose and with the sole effect of
reincorporating the Company in another jurisdiction. In addition,
notwithstanding clause (3) above, BLUM CB Corp. may merge into CB Richard Ellis
Services, Inc. on the Merger Date as contemplated by the Merger Agreement.

          The Successor Company shall be the successor to the Company and shall
succeed to, and be substituted for, and may exercise every right and power of,
the Company under this Indenture, and the predecessor Company, except in the
case of a lease, shall be released from the obligation to pay the principal of
and interest on the Securities.
<PAGE>

                                                                              67

          (b)  The Company shall not permit any Subsidiary Guarantor to
consolidate with or merge with or into, or convey, transfer or lease, in one
transaction or series of transactions, all or substantially all of its assets to
any Person unless:

          (1)  except in the case of a Subsidiary Guarantor that has been
     disposed of in its entirety to another Person (other than to the Company or
     an Affiliate of the Company), whether through a merger, consolidation or
     sale of Capital Stock or assets, if in connection therewith the Company
     provides an Officers' Certificate to the Trustee to the effect that the
     Company will comply with its obligations under Section 4.06 in respect of
     such disposition, the resulting, surviving or transferee Person (if not
     such Subsidiary) shall be a Person organized and existing under the laws of
     the jurisdiction under which such Subsidiary was organized or under the
     laws of the United States of America, or any State thereof or the District
     of Columbia, and such Person shall expressly assume, by a Guaranty
     Agreement, all the obligations of such Subsidiary, if any, under its
     Subsidiary Guaranty;

          (2)  immediately after giving effect to such transaction or
     transactions on a pro forma basis (and treating any Indebtedness which
     becomes an obligation of the resulting, surviving or transferee Person as a
     result of such transaction as having been issued by such Person at the time
     of such transaction), no Default shall have occurred and be continuing; and

          (3)  the Company delivers to the Trustee an Officers' Certificate and
     an Opinion of Counsel, each stating that such consolidation, merger or
     transfer and such Guaranty Agreement, if any, complies with this Indenture.

          (c)  Parent shall not consolidate with or merge with or into, or
convey, transfer or lease, in one transaction or a series of transactions, all
or substantially all of its assets to any Person unless:

          (1)  the resulting, surviving or transferee Person (if not Parent)
     shall be a Person organized and existing under the laws of the United
     States of America, any State thereof or the District of Columbia, and such
     Person shall expressly assume, by a Guaranty Agreement, all the obligations
     of Parent, if any, under its Guaranty;
<PAGE>

                                                                              68

          (2)  immediately after giving effect to such transaction or
     transactions on a pro forma basis (and treating any Indebtedness which
     becomes an obligation of the resulting, surviving or transferee Person as a
     result of such transaction as having been issued by such Person at the time
     of such transaction), no Default shall have occurred and be continuing; and

          (3)  the Company delivers to the Trustee an Officers' Certificate and
     an Opinion of Counsel, each stating that such consolidation, merger or
     transfer and such Guaranty Agreement, if any, complies with this Indenture.

                                   ARTICLE 6

                             Defaults and Remedies
                             ---------------------

          SECTION 6.01.  Events of Default. An "Event of Default" occurs if:
                         ------------------

          (1)  the Company defaults in any payment of interest on any Security
     when the same becomes due and payable, whether or not such payment shall be
     prohibited by Article 10, and such default continues for a period of 30
     days;

          (2)  the Company (i) defaults in the payment of the principal of any
     Security when the same becomes due and payable at its Stated Maturity, upon
     redemption, upon declaration of acceleration or otherwise, whether or not
     such payment shall be prohibited by Article 10 or (ii) fails to redeem or
     purchase Securities when required pursuant to this Indenture or the
     Securities, whether or not such redemption or purchase shall be prohibited
     by Article 10;

          (3)  the Company, Parent or any Subsidiary Guarantor fails to comply
     with Section 5.01;

          (4)  the Company, Parent or any Subsidiary Guarantor, as the case may
     be, fails to comply with Section 4.02, 4.03, 4.04, 4.05, 4.06, 4.07, 4.08,
     4.09 or 4.10 (other than a failure to purchase Securities when required
     under Section 4.06 or 4.09) and such failure continues for 30 days after
     the notice specified below;

          (5)  the Company, Parent or any Subsidiary Guarantor fails to comply
     with any of its agreements in
<PAGE>

                                                                              69

     the Securities or this Indenture (other than those referred to in clause
     (1), (2), (3) or (4) above) and such failure continues for 60 days after
     the notice specified below;

          (6)  Indebtedness of the Company or any Significant Subsidiary is not
     paid within any applicable grace period after final maturity or is
     accelerated by the holders thereof because of a default and the total
     amount of such Indebtedness unpaid or accelerated exceeds $10.0 million, or
     its foreign currency equivalent at the time;

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

               (A)  commences a voluntary case;

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

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

               (D)  makes a general assignment for the benefit of its creditors;

     or takes any comparable action under any foreign laws relating to
     insolvency;

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

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

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

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

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

          (9)  any judgment or decree for the payment of money (other than
     judgments which are covered by
<PAGE>

                                                                              70

     enforceable insurance policies issued by solvent carriers) in excess of
     $10.0 million (or its foreign currency equivalent at the time) is entered
     against the Company or any Significant Subsidiary, remains outstanding for
     a period of 60 days following the entry of such judgment or decree and is
     not discharged, waived or the execution thereof stayed within 10 days after
     the notice specified below; or

          (10) the Parent Guaranty or a Subsidiary Guaranty ceases to be in full
     force and effect (other than in accordance with the terms of such Guaranty)
     or a Guarantor denies or disaffirms its obligations under its Guaranty.

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

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

          A Default under clauses (4), (5) or (9) is not an Event of Default
until the Trustee or the holders of at least 25% in principal amount of the
outstanding Securities notify the Company of the Default and the Company does
not cure such Default within the time specified after receipt of such notice.
Such notice must specify the Default, demand that it be remedied and state that
such notice is a "Notice of Default".

          The Company shall deliver to the Trustee, within 30 days after the
occurrence thereof, written notice in the form of an Officers' Certificate of
any Event of Default under clause (6) or (10) and any event which with the
giving of notice or the lapse of time would become an Event of Default under
clause (4), (5) or (9), its status and what action the Company is taking or
proposes to take with respect thereto.

          SECTION 6.02.  Acceleration. If an Event of Default (other than an
                         -------------
Event of Default specified in Section 6.01(7) or (8) with respect to the
Company) occurs and is continuing, the Trustee by notice to the Company, or the
Holders of at least 25% in principal amount of the
<PAGE>

                                                                              71

Securities by notice to the Company and the Trustee, may declare the principal
of and accrued but unpaid interest on all the Securities to be due and payable;
provided, however, that so long as any Bank Indebtedness remains outstanding, no
--------  -------
such acceleration shall be effective until the earlier of (1) five Business Days
after the giving of written notice to the Company and the administrative agent
(or similar agent if there is no administrative agent) under the Credit
Agreement and (2) the day on which any Bank Indebtedness is accelerated. Upon
such a declaration, such principal and interest shall be due and payable
immediately. If an Event of Default specified in Section 6.01(7) or (8) with
respect to the Company occurs and is continuing, the principal of and interest
on all the Securities shall ipso facto become and be immediately due and payable
                            ---- -----
without any declaration or other act on the part of the Trustee or any
Security-holders. The Holders of a majority in principal amount of the
Securities by notice to the Trustee may rescind an acceleration and its
consequences if the rescission would not conflict with any judgment or decree
and if all existing Events of Default have been cured or waived except
nonpayment of principal or interest that has become due solely because of
acceleration. No such rescission shall affect any subsequent Default or impair
any right consequent thereto.

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

          The Trustee may maintain a proceeding even if it does not possess any
of the Securities or does not produce any of them in the proceeding. A delay or
omission by the Trustee or any Securityholder in exercising any right or remedy
accruing upon an Event of Default shall not impair the right or remedy or
constitute a waiver of or acquiescence in the Event of Default. No remedy is
exclusive of any other remedy. All available remedies are cumulative.

          SECTION 6.04.  Waiver of Past Defaults. The Holders of a majority in
                         -----------------------
principal amount of the Securities by notice to the Trustee may waive an
existing Default and its consequences except (i) a Default in the payment of the
principal of or interest on a Security (ii) a Default arising from the failure
to redeem or purchase any Security when required pursuant to this Indenture or
(iii) a Default in respect of a provision that under Section 9.02 cannot be
amended without the consent of each Securityholder affected. When a Default is
waived, it is deemed cured, but no such
<PAGE>

                                                                              72

waiver shall extend to any subsequent or other Default or impair any consequent
right.

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

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

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

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

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

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

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

          A Securityholder may not use this Indenture to prejudice the rights of
another Securityholder or to obtain a preference or priority over another
Securityholder.
<PAGE>

                                                                              73

          SECTION 6.07.  Rights of Holders to Receive Payment. Notwithstanding
                         ------------------------------------
any other provision of this Indenture, the right of any Holder to receive
payment of principal of and interest on the Securities held by such Holder, on
or after the respective due dates expressed in the Securities, or to bring suit
for the enforcement of any such payment on or after such respective dates, shall
not be impaired or affected without the consent of such Holder.

          SECTION 6.08.  Collection Suit by Trustee. If an Event of Default
                         --------------------------
specified in Section 6.01(1) or (2) occurs and is continuing, the Trustee may
recover judgment in its own name and as trustee of an express trust against the
Company for the whole amount then due and owing (together with interest on any
unpaid interest to the extent lawful) and the amounts provided for in Section
7.07.

          SECTION 6.09.  Trustee May File Proofs of Claim. The Trustee may file
                         --------------------------------
such proofs of claim and other papers or documents as may be necessary or
advisable in order to have the claims of the Trustee and the Securityholders
allowed in any judicial proceedings relative to the Company, its creditors or
its property and, unless prohibited by law or applicable regulations, may vote
on behalf of the Holders in any election of a trustee in bankruptcy or other
Person performing similar functions, and any Custodian in any such judicial
proceeding is hereby authorized by each Holder to make payments to the Trustee
and, in the event that the Trustee shall consent to the making of such payments
directly to the Holders, to pay to the Trustee any amount due it for the
reasonable compensation, expenses, disbursements and advances of the Trustee,
its agents and its counsel, and any other amounts due the Trustee under Section
7.07.

          SECTION 6.10.  Priorities.  If the Trustee collects any money or
                         ----------
property pursuant to this Article 6, it shall pay out the money or property in
the following order:

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

          SECOND:  to holders of Senior Indebtedness of the Company and, if such
     money or property has been collected from a Guarantor, to holders of Senior
     Indebtedness of such Guarantor, in each case to the extent required by
     Article 10 and 12;

          THIRD:  to Securityholders for amounts due and unpaid on the
     Securities for principal and interest, ratably, without preference or
     priority of any kind,
<PAGE>

                                                                              74

     according to the amounts due and payable on the Securities for principal
     and interest, respectively; and

          FOURTH:  to the Company.

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

          SECTION 6.11.  Undertaking for Costs. In any suit for the enforcement
                         ---------------------
of any right or remedy under this Indenture or in any suit against the Trustee
for any action taken or omitted by it as Trustee, a court in its discretion may
require the filing by any party litigant in the suit of an undertaking to pay
the costs of the suit, and the court in its discretion may assess reasonable
costs, including reasonable attorneys' fees, against any party litigant in the
suit, having due regard to the merits and good faith of the claims or defenses
made by the party litigant. This Section does not apply to a suit by the
Trustee, a suit by a Holder pursuant to Section 6.07 or a suit by Holders of
more than 10% in principal amount of the Securities.

          SECTION 6.12.  Waiver of Stay or Extension Laws. The Company (to the
                         --------------------------------
extent it may lawfully do so under applicable law) shall not at any time insist
upon, or plead, or in any manner whatsoever claim or take the benefit or
advantage of, any stay or extension law wherever enacted, now or at any time
hereafter in force, which may affect the covenants or the performance of this
Indenture; and the Company (to the extent that it may lawfully do so) hereby
expressly waives all benefit or advantage of any such law, and shall not hinder,
delay or impede the execution of any power herein granted to the Trustee, but
shall suffer and permit the execution of every such power as though no such law
had been enacted.

                                   ARTICLE 7

                                    Trustee
                                    -------

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

                                                                              75

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

          (1)  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

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

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

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

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

          (3)  the Trustee shall not be liable with respect to any action it
     takes or omits to take in good faith in accordance with a direction
     received by it pursuant to Section 6.05.

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

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

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

          (g)  No provision of this Indenture shall require the Trustee to
expend or risk its own funds or otherwise incur financial liability in the
performance of any of its
<PAGE>

                                                                              76

duties hereunder or in the exercise of any of its rights or powers, if it shall
have reasonable grounds to believe that repayment of such funds or adequate
indemnity against such risk or liability is not reasonably assured to it.

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

          SECTION 7.02.  Rights of Trustee. (a) The Trustee may rely on any
                         -----------------
document believed by it to be genuine and to have been signed or presented by
the proper person. The Trustee need not investigate any fact or matter stated in
the document.

          (b)  Before the Trustee acts or refrains from acting, it may require
an Officers' Certificate or an Opinion of Counsel. The Trustee shall not be
liable for any action it takes or omits to take in good faith in reliance on the
Officers' Certificate or Opinion of Counsel.

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

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

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

          SECTION 7.03.  Individual Rights of Trustee. The Trustee in its
                         ----------------------------
individual or any other capacity may become the owner or pledgee of Securities
and may otherwise deal with the Company or its Affiliates with the same rights
it would have if it were not Trustee. Any Paying Agent, Registrar, co-registrar
or co-paying agent may do the same with like rights. However, the Trustee must
comply with Sections 7.10 and 7.11.

          SECTION 7.04.  Trustee's Disclaimer.  The Trustee shall not be
                         ---------------------
responsible for and makes no representation as
<PAGE>

                                                                              77

to the validity or adequacy of this Indenture or the Securities, it shall not be
accountable for the Company's use of the proceeds from the Securities, and it
shall not be responsible for any statement of the Company in the Indenture or in
any document issued in connection with the sale of the Securities or in the
Securities other than the Trustee's certificate of authentication.

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

          SECTION 7.06.  Reports by Trustee to Holders. As promptly as
                         -----------------------------
practicable after each May 15 beginning with the May 15 following the date of
this Indenture, and in any event prior to July 15 in each year, the Trustee
shall mail to each Securityholder a brief report dated as of May 15 that
complies with TIA (s) 313(a). The Trustee also shall comply with TIA (s) 313(b).

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

          SECTION 7.07.  Compensation and Indemnity. The Company shall pay to
                         --------------------------
the Trustee from time to time reasonable compensation for its services. The
Trustee's compensation shall not be limited by any law on compensation of a
trustee of an express trust. The Company shall reimburse the Trustee upon
request for all reasonable out-of-pocket expenses incurred or made by it,
including costs of collection, in addition to the compensation for its services.
Such expenses shall include the reasonable compensation and expenses,
disbursements and advances of the Trustee's agents, counsel, accountants and
experts. The Company shall indemnify the Trustee against any and all loss,
liability or expense (including attorneys' fees) incurred by it in connection
with the administration of this trust and the performance of its duties
hereunder. The Trustee shall notify the Company promptly of any claim for which
it may seek indemnity. Failure by the Trustee to so
<PAGE>

                                                                              78

notify the Company shall not relieve the Company of its obligations hereunder.
The Company shall defend the claim and the Trustee may have separate counsel and
the Company shall pay the fees and expenses of such counsel. The Company need
not reimburse any expense or indemnify against any loss, liability or expense
incurred by the Trustee through the Trustee's own wilful misconduct, negligence
or bad faith.

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

          The Company's payment obligations pursuant to this Section shall
survive the discharge of this Indenture. When the Trustee incurs expenses after
the occurrence of a Default specified in Section 6.01(7) or (8) with respect to
the Company, the expenses are intended to constitute expenses of administration
under the Bankruptcy Law.

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

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

          (2)  the Trustee is adjudged bankrupt or insolvent;

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

          (4)  the Trustee otherwise becomes incapable of acting.

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

          A successor Trustee shall deliver a written acceptance of its
appointment to the retiring Trustee and to the Company. Thereupon the
resignation or removal of the retiring Trustee shall become effective, and the
successor
<PAGE>

                                                                              79

Trustee shall have all the rights, powers and duties of the Trustee under this
Indenture. The successor Trustee shall mail a notice of its succession to
Securityholders. The retiring Trustee shall promptly transfer all property held
by it as Trustee to the successor Trustee, subject to the lien provided for in
Section 7.07.

          If a successor Trustee does not take office within 60 days after the
retiring Trustee resigns or is removed, the retiring Trustee or the Holders of
10% in principal amount of the Securities may petition any court of competent
jurisdiction for the appointment of a successor Trustee.

          If the Trustee fails to comply with Section 7.10, any Securityholder
may petition any court of competent jurisdiction for the removal of the Trustee
and the appointment of a successor Trustee.

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

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

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

          SECTION 7.10.  Eligibility; Disqualification. The Trustee shall at all
                         ------------------------------
times satisfy the requirements of TIA (S)310(a). The Trustee (or, in the case
of a subsidiary of a bank holding company, its corporate parent) shall have a
<PAGE>

                                                                              80

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

          SECTION 7.11.  Preferential Collection of Claims Against Company. The
                         -------------------------------------------------
Trustee shall comply with TIA (S) 311(a), excluding any creditor relationship
listed in TIA (S) 311(b). A Trustee who has resigned or been removed shall be
subject to TIA (S) 311(a) to the extent indicated.

                                   ARTICLE 8

                      Discharge of Indenture; Defeasance
                      ----------------------------------

          SECTION 8.01.  Discharge of Liability on Securities; Defeasance. (a)
                         ------------------------------------------------
When (1) the Company delivers to the Trustee all outstanding Securities (other
than Securities replaced pursuant to Section 2.07) for cancellation or (2) all
outstanding Securities have become due and payable, whether at maturity or on a
redemption date as a result of the mailing of a notice of redemption pursuant to
Article 3 hereof and the Company irrevocably deposits with the Trustee funds
sufficient to pay at maturity or upon redemption all outstanding Securities,
including interest thereon to maturity or such redemption date (other than
Securities replaced pursuant to Section 2.07), and if in either case the Company
pays all other sums payable hereunder by the Company, then this Indenture shall,
subject to Section 8.01(c), cease to be of further effect. The Trustee shall
acknowledge satisfaction and discharge of this Indenture on demand of the
Company accompanied by an Officers' Certificate and an Opinion of Counsel and at
the cost and expense of the Company.

          (b)  Subject to Sections 8.01(c) and 8.02, the Company at any time may
terminate (1) all its obligations under the Securities and this Indenture
("legal defeasance option") or (2) its obligations under Sections 4.02, 4.03,
4.04, 4.05, 4.06, 4.07, 4.08, 4.09 and 4.10 and the operation of Sections
6.01(4), 6.01(6), 6.01(7), 6.01(8) and 6.01(9) (but, in the case of Sections
6.01(7) and (8), with respect only to Significant Subsidiaries) and the
limitations contained in Section 5.01(a)(3) ("covenant defeasance option"). The
Company may exercise its legal
<PAGE>

                                                                              81

defeasance option notwithstanding its prior exercise of its covenant defeasance
option.

          If the Company exercises its legal defeasance option, payment of the
Securities may not be accelerated because of an Event of Default with respect
thereto. If the Company exercises its covenant defeasance option, payment of the
Securities may not be accelerated because of an Event of Default specified in
Sections 6.01(4), 6.01(6), 6.01(7), 6.01(8) and 6.01(9) (but, in the case of
Sections 6.01(7) and (8), with respect only to Significant Subsidiaries) or
because of the failure of the Company to comply with Section 5.01(a)(3). If the
Company exercises its legal defeasance option or its covenant defeasance option,
each Guarantor, if any, shall be released from all its obligations with respect
to its Guaranty.

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

          (c)  Notwithstanding clauses (a) and (b) above, the Company's
obligations in Sections 2.03, 2.04, 2.05, 2.06, 2.07, 2.08, 7.07 and 7.08 and in
this Article 8 shall survive until the Securities have been paid in full.
Thereafter, the Company's obligations in Sections 7.07, 8.04 and 8.05 shall
survive.

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

          (1)  the Company irrevocably deposits in trust with the Trustee money
     or U.S. Government Obligations for the payment of principal of and interest
     on the Securities to maturity or redemption, as the case may be;

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

          (3)  123 days pass after the deposit is made and during the 123-day
     period no Default specified in
<PAGE>

                                                                              82

         Sections 6.01(7) or (8) with respect to the Company occurs which is
         continuing at the end of the period;

               (4) the deposit does not constitute a default under any other
         agreement binding on the Company and is not prohibited by Article 10;

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

               (6) in the case of the legal defeasance option, the Company shall
         have delivered to the Trustee an Opinion of Counsel stating that (A)
         the Company has received from, or there has been published by, the
         Internal Revenue Service a ruling, or (B) since the date of this
         Indenture there has been a change in the applicable Federal income tax
         law, in either case to the effect that, and based thereon such Opinion
         of Counsel shall confirm that, the Securityholders will not recognize
         income, gain or loss for Federal income tax purposes as a result of
         such defeasance and will be subject to Federal income tax on the same
         amounts, in the same manner and at the same times as would have been
         the case if such defeasance had not occurred;

               (7) in the case of the covenant defeasance option, the Company
         shall have delivered to the Trustee an Opinion of Counsel to the effect
         that the Security holders will not recognize income, gain or loss for
         Federal income tax purposes as a result of such covenant defeasance
         and will be subject to Federal income tax on the same amounts, in the
         same manner and at the same times as would have been the case if such
         covenant defeasance had not occurred; and

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

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

               SECTION 8.03.  Application of Trust Money. The Trustee shall hold
                              ---------------------------
in trust money or U.S. Government Obligations deposited with it pursuant to this
Article 8. It
<PAGE>

                                                                              83

shall apply the deposited money and the money from U.S. Government Obligations
through the Paying Agent and in accordance with this Indenture to the payment of
principal of and interest on the Securities. Money and securities so held in
trust are not subject to Article 10.

               SECTION 8.04. Repayment to Company. The Trustee and the Paying
                             ---------------------
Agent shall promptly turn over to the Company upon request any excess money or
securities held by them at any time.

               Subject to any applicable abandoned property law, the Trustee and
the Paying Agent shall pay to the Company upon request any money held by them
for the payment of principal or interest that remains unclaimed for two years,
and, thereafter, Securityholders entitled to the money must look to the Company
for payment as general creditors.

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

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

                                                                              84

                                   ARTICLE 9

                                  Amendments
                                  ----------

               SECTION 9.01.  Without Consent of Holders. The Company, the
                              --------------------------
Guarantors and the Trustee may amend this Indenture, or the Securities without
notice to or consent of any Securityholder:

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

               (2) to comply with Article 5;

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

               (4) to add guarantees with respect to the Securities, including
         any Guaranties, or to secure the Securities ;

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

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

               (7) to make any change that does not adversely affect the rights
         of any Securityholder.

               An amendment under this Section may not make any change that
adversely affects the rights under Article 10 or 12 of any holder of Senior
Indebtedness of the Company or of a Guarantor then outstanding unless the
holders of such Senior Indebtedness (or any group or representative thereof
authorized to give a consent) consent to such change.

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

                                                                              85

               SECTION 9.02.  With Consent of Holders. The Company, the
                              ------------------------
Guarantors and the Trustee may amend this Indenture or the Securities without
notice to any Securityholder but with the written consent of the Holders of at
least a majority in principal amount of the Securities then outstanding
(including consents obtained in connection with a tender offer or exchange for
the Securities). However, without the consent of each Securityholder affected
thereby, an amendment may not:

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

               (2) reduce the rate of or extend the time for payment of interest
         on any Security;

               (3) reduce the principal amount of or extend the Stated Maturity
         of any Security;

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

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

               (6) make any changes in the ranking or priority of any Security
         that would adversely affect the Securityholders;

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

               (8) make any change in any Guaranty that would adversely affect
         the Securityholders.

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

               An amendment under this Section may not make any change that
adversely affects the rights under Article 10 or 12 or any Guaranty Agreement of
any holder of Senior Indebtedness of the Company or of a Guarantor then
outstanding unless the holders of such Senior Indebtedness (or any group or
representative thereof authorized to give a consent) consent to such change.
<PAGE>

                                                                              86

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

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

               SECTION 9.04.  Revocation and Effect of Consents and Waivers. A
                              ----------------------------------------------
consent to an amendment or a waiver by a Holder of a Security shall bind the
Holder and every subsequent Holder of that Security or portion of the Security
that evidences the same debt as the consenting Holder's Security, even if
notation of the consent or waiver is not made on the Security. However, any such
Holder or subsequent Holder may revoke the consent or waiver as to such
Holder's Security or portion of the Security if the Trustee receives the notice
of revocation before the date the amendment or waiver becomes effective. After
an amendment or waiver becomes effective, it shall bind every Security holder.
An amendment or waiver becomes effective upon the execution of such amendment or
waiver by the Trustee.

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

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

                                                                              87

               SECTION 9.06.  Trustee To Sign Amendments. The Trustee shall sign
                              ---------------------------
any amendment authorized pursuant to this Article 9 if the amendment does not
adversely affect the rights, duties, liabilities or immunities of the Trustee.
If it does, the Trustee may but need not sign it. In signing such amendment the
Trustee shall be entitled to receive indemnity reasonably satisfactory to it and
to receive, and (subject to Section 7.01) shall be fully protected in relying
upon, an Officers' Certificate and an Opinion of Counsel stating that such
amendment is authorized or permitted by this Indenture.

               SECTION 9.07.  Payment for Consent. Neither the Company nor any
                              --------------------
Affiliate of the Company shall, directly or indirectly, pay or cause to be paid
any consideration, whether by way of interest, fee or otherwise, to any Holder
for or as an inducement to any consent, waiver or amendment of any of the terms
or provisions of this Indenture or the Securities unless such consideration is
offered to be paid to all Holders that so consent, waive or agree to amend in
the time frame set forth in solicitation documents relating to such consent,
waiver or agreement.

                                  ARTICLE 10

                                 Subordination
                                 -------------

               SECTION 10.01.  Agreement To Subordinate. The Company agrees, and
                               -------------------------
each Securityholder by accepting a Security agrees, that the Indebtedness
evidenced by the Securities is subordinated in right of payment, to the extent
and in the manner provided in this Article 10, to the prior payment of all
Senior Indebtedness of the Company and that the subordination is for the benefit
of and enforceable by the holders of such Senior Indebtedness. The Securities
shall in all respects rank pari passu with all other Senior Subordinated
                           ---- -----
Indebtedness of the Company and only Indebtedness of the Company which is Senior
Indebtedness of the Company shall rank senior to the Securities in accordance
with the provisions set forth herein. All provisions of this Article 10 shall be
subject to Section 10.12.

               SECTION 10.02.  Liquidation, Dissolution, Bankruptcy. Upon any
                               -------------------------------------
payment or distribution of the assets of the Company to creditors upon a total
or partial liquidation
<PAGE>

                                                                              88

or a total or partial dissolution of the Company or in a bankruptcy,
reorganization, insolvency, receivership or similar proceeding relating to the
Company or its property:

               (1) holders of Senior Indebtedness of the Company shall be
         entitled to receive payment in full in cash of such Senior Indebtedness
         before Securityholders shall be entitled to receive any payment; and

               (2) until the Senior Indebtedness of the Company is paid in full
         in cash, any payment or distribution to which Securityholders would be
         entitled but for this Article 10 shall be made to holders of such
         Senior Indebtedness as their interests may appear, except that
         Securityholders may receive shares of stock and any debt securities
         that are subordinated to such Senior Indebtedness to at least the same
         extent as the Securities.

               SECTION 10.03.  Default on Senior Indebtedness of the Company.
                               ----------------------------------------------
The Company shall not pay the principal of, premium, if any, or interest on the
Securities or make any deposit pursuant to Section 8.01 and may not purchase,
redeem or (except for Securities delivered to the Trustee pursuant to the second
sentence of paragraph 6 of the Securities) otherwise retire any Securities
(except for any redemption pursuant to paragraph 6 of the Securities)
(collectively, "pay the Securities") if either of the following (a "Payment
Default") occurs (1) any Designated Senior Indebtedness of the Company is not
paid in full in cash when due; or (2) any other default on Designated Senior
Indebtedness of the Company occurs and the maturity of such Designated Senior
Indebtedness is accelerated in accordance with its terms unless, in either case,
the Payment Default has been cured or waived and any such acceleration has been
rescinded or such Designated Senior Indebtedness has been paid in full in cash;
provided, however, that the Company shall be entitled to pay the Securities
--------  -------
without regard to the foregoing if the Company and the Trustee receive written
notice approving such payment from the Representative of any Designated Senior
Indebtedness with respect to which the Payment Default has occurred and is
continuing. During the continuance of any default (other than a Payment Default)
with respect to any Designated Senior Indebtedness of the Company pursuant to
which the maturity thereof may be accelerated immediately without further notice
(except such notice as may be required to effect such acceleration) or the
expiration of any applicable grace periods, the Company shall not pay the
Securities for a period (a "Payment Blockage Period") commencing upon the
receipt by the Trustee of (with a copy to the Company) written notice (a
"Blockage
<PAGE>

                                                                              89

Notice") of such default from the Representative of such Designated Senior
Indebtedness specifying an election to effect a Payment Blockage Period and
ending 179 days thereafter. The Payment Blockage Period shall end earlier if
such Payment Blockage Period is terminated (1) by written notice to the Trustee
and the Company from the Person or Persons who gave such Blockage Notice; (2)
because the default giving rise to such Blockage Notice is cured, waived or
otherwise no longer continuing; or (3) because such Designated Senior
Indebtedness has been discharged or repaid in full in cash. Notwithstanding the
provisions described in the immediately preceding two sentences (but subject to
the provisions contained in the first sentence of this Section), unless the
holders of such Designated Senior Indebtedness or the Representative of such
Designated Senior Indebtedness shall have accelerated the maturity of such
Designated Senior Indebtedness, the Company shall be entitled to resume payments
on the Securities after termination of such Payment Blockage Period. The
Securities shall not be subject to more than one Payment Blockage Period in any
consecutive 360-day period, irrespective of the number of defaults with respect
to Designated Senior Indebtedness of the Company during such period; provided,
                                                                     --------
however, that if any Blockage Notice within such 360-day period is given by or
-------
on behalf of any holders of Designated Senior Indebtedness of the Company (other
than the Bank Indebtedness), the Representative of the Bank Indebtedness shall
be entitled to give another Blockage Notice within such period; provided
                                                                --------
further, however, that in no event shall the total number of days during which
-------  -------
any Payment Blockage Period or Periods is in effect exceed 179 days in the
aggregate during any 360-day consecutive period, and there must be 181 days
during any 360-day consecutive period during which no Payment Blockage Period is
in effect. For purposes of this Section, no default or event of default which
existed or was continuing on the date of the commencement of any Payment
Blockage Period with respect to the Designated Senior Indebtedness of the
Company initiating such Payment Blockage Period shall be, or be made, the basis
of the commencement of a subsequent Payment Blockage Period by the
Representative of such Designated Senior Indebtedness, whether or not within a
period of 360 consecutive days, unless such default or event of default shall
have been cured or waived for a period of not less than 90 consecutive days.

               SECTION 10.04.  Acceleration of Payment of Securities. If payment
                               --------------------------------------
of the Securities is accelerated because of an Event of Default, the Company or
the Trustee shall promptly notify the holders of the Designated Senior
<PAGE>

                                                                              90

Indebtedness of the Company (or their Representatives) of the acceleration.

               SECTION 10.05.  When Distribution Must Be Paid Over. If a
                               ------------------------------------
distribution is made to Securityholders that because of this Article 10 should
not have been made to them, the Securityholders who receive the distribution
shall hold it in trust for holders of Senior Indebtedness of the Company and pay
it over to them as their interests may appear. If any Designated Senior
Indebtedness of the Company is outstanding, the Company shall not pay the
Securities until five Business Days after the Representatives of all the issues
of Designated Senior Indebtedness of the Company receive notice of such
acceleration and, thereafter, shall be entitled to pay the Securities only if
this Article 10 otherwise permits payment at that time.

               SECTION 10.06.  Subrogation. After all Senior Indebtedness of the
                               ------------
Company is paid in full and until the Securities are paid in full,
Securityholders shall be subrogated to the rights of holders of such Senior
Indebtedness to receive distributions applicable to such Senior Indebtedness. A
distribution made under this Article 10 to holders of such Senior Indebtedness
which otherwise would have been made to Securityholders is not, as between the
Company and Securityholders, a payment by the Company on such Senior
Indebtedness.

               SECTION 10.07.  Relative Rights. This Article 10 defines the
                               ----------------
relative rights of Securityholders and holders of Senior Indebtedness of the
Company. Nothing in this Indenture shall:

               (1) impair, as between the Company and Securityholders, the
         obligation of the Company, which is absolute and unconditional, to pay
         principal of and interest on the Securities in accordance with their
         terms; or

               (2) prevent the Trustee or any Securityholder from exercising its
         available remedies upon a Default, subject to the rights of holders of
         Senior Indebtedness of the Company to receive distributions otherwise
         payable to Securityholders.

               SECTION 10.08.  Subordination May Not Be Impaired by Company. No
                               ---------------------------------------------
right of any holder of Senior Indebtedness of the Company to enforce the
subordination of the Indebtedness evidenced by the Securities shall be impaired
<PAGE>

                                                                              91

by any act or failure to act by the Company or by its failure to comply with
this Indenture.

               SECTION 10.09.  Rights of Trustee and Paying Agent.
                               -----------------------------------
Notwithstanding Section 10.03, the Trustee or Paying Agent shall continue to
make payments on the Securities and shall not be charged with knowledge of the
existence of facts that under this Article 10 would prohibit the making of any
such payments unless, not less than two Business Days prior to the date of such
payment, a Trust Officer of the Trustee receives notice satisfactory to it that
such payments are prohibited by this Article 10. The Company, the Registrar or
co-registrar, the Paying Agent, a Representative or a holder of Senior
Indebtedness of the Company shall be entitled to give the notice; provided,
                                                                  --------
however, that, if an issue of Senior Indebtedness of the Company has a
-------
Representative, only the Representative shall be entitled to give the notice.

               The Trustee in its individual or any other capacity shall be
entitled to hold Senior Indebtedness of the Company with the same rights it
would have if it were not Trustee. The Registrar and co-registrar and the Paying
Agent shall be entitled to do the same with like rights. The Trustee shall be
entitled to all the rights set forth in this Article 10 with respect to any
Senior Indebtedness of the Company which may at any time be held by it, to the
same extent as any other holder of such Senior Indebtedness; and nothing in
Article 7 shall deprive the Trustee of any of its rights as such holder. Nothing
in this Article 10 shall apply to claims of, or payments to, the Trustee under
or pursuant to Section 7.07.

               SECTION 10.10.  Distribution or Notice to Representative.
                               -----------------------------------------
Whenever any Person is to make a distribution or give a notice to holders of
Senior Indebtedness of the Company, such Person shall be entitled to make such
distribution or give such notice to their Representative (if any).

               SECTION 10.11.  Article 10 Not To Prevent Events of Default or
                               ----------------------------------------------
Limit Right To Accelerate. The failure to make a payment pursuant to the
--------------------------
Securities by reason of any provision in this Article 10 shall not be construed
as preventing the occurrence of a Default. Nothing in this Article 10 shall have
any effect on the right of the Securityholders or the Trustee to accelerate the
maturity of the Securities.

               SECTION 10.12.  Trust Moneys Not Subordinated. Notwithstanding
                               ------------------------------
anything contained herein to the contrary,
<PAGE>

                                                                              92

payments from money or the proceeds of U.S. Government Obligations held in trust
under Article 8 by the Trustee for the payment of principal of and interest on
the Securities shall not be subordinated to the prior payment of any Senior
Indebtedness of the Company or subject to the restrictions set forth in this
Article 10 if the provisions of this Article 10 were not violated at the time
funds were deposited in trust with the Trustee pursuant to Article 8, and none
of the Securityholders shall be obligated to pay over any such amount to the
Company or any holder of Senior Indebtedness of the Company or any other
creditor of the Company.

          SECTION 10.13. Trustee Entitled To Rely. Upon any payment or
                         ------------------------
distribution pursuant to this Article 10, the Trustee and the Securityholders
shall be entitled to rely (1) upon any order or decree of a court of competent
jurisdiction in which any proceedings of the nature referred to in Section 10.02
are pending, (2) upon a certificate of the liquidating trustee or agent or other
Person making such payment or distribution to the Trustee or to the Security
holders or (3) upon the Representatives of Senior Indebtedness of the Company
for the purpose of ascertaining the Persons entitled to participate in such
payment or distribution, the holders of such Senior Indebtedness and other
Indebtedness of the Company, the amount thereof or payable thereon, the amount
or amounts paid or distributed thereon and all other facts pertinent thereto or
to this Article 10. In the event that the Trustee determines, in good faith,
that evidence is required with respect to the right of any Person as a holder of
Senior Indebtedness of the Company to participate in any payment or distribution
pursuant to this Article 10, the Trustee shall be entitled to request such
Person to furnish evidence to the reasonable satisfaction of the Trustee as to
the amount of such Senior Indebtedness held by such Person, the extent to which
such Person is entitled to participate in such payment or distribution and other
facts pertinent to the rights of such Person under this Article 10, and, if such
evidence is not furnished, the Trustee shall be entitled to defer any payment to
such Person pending judicial determination as to the right of such Person to
receive such payment. The provisions of Sections 7.01 and 7.02 shall be
applicable to all actions or omissions of actions by the Trustee pursuant to
this Article 10.

     SECTION 10.14.  Trustee To Effectuate Subordination.  Each Securityholder
                     -----------------------------------
by accepting a Security authorizes and directs the Trustee on his behalf to take
such action as may be necessary or appropriate to acknowledge or effectuate the
subordination between the Securityholders and
<PAGE>

                                                                              93

the holders of Senior Indebtedness of the Company as provided in this Article 10
and appoints the Trustee as attorney-in-fact for any and all such purposes.

          SECTION 10.15. Trustee Not Fiduciary for Holders of Senior
                         -------------------------------------------
Indebtedness of the Company. The Trustee shall not be deemed to owe any
---------------------------
fiduciary duty to the holders of Senior Indebtedness of the Company and shall
not be liable to any such holders if it shall mistakenly pay over or distribute
to Securityholders or the Company or any other Person, money or assets to which
any holders of Senior Indebtedness of the Company shall be entitled by virtue of
this Article 10 or otherwise.

          SECTION 10.16. Reliance by Holders of Senior Indebtedness of the
                         -------------------------------------------------
Company on Subordination Provisions. Each Securityholder by accepting a Security
-----------------------------------
acknowledges and agrees that the foregoing subordination provisions are, and are
intended to be, an inducement and a consideration to each holder of any Senior
Indebtedness of the Company, whether such Senior Indebtedness was created or
acquired before or after the issuance of the Securities, to acquire and continue
to hold, or to continue to hold, such Senior Indebtedness and such holder of
such Senior Indebtedness shall be deemed conclusively to have relied on such
subordination provisions in acquiring and continuing to hold, or in continuing
to hold, such Senior Indebtedness.

                                  ARTICLE 11

                                  Guaranties
                                  ----------

          SECTION 11.01. Guaranties. Each Guarantor hereby unconditionally and
                         ----------
irrevocably guarantees, jointly and severally, to each Holder and to the Trustee
and its successors and assigns (a) the full and punctual payment of principal of
and interest on the Securities when due, whether at maturity, by acceleration,
by redemption or otherwise, and all other monetary obligations of the Company
under this Indenture and the Securities and (b) the full and punctual
performance within applicable grace periods of all other obligations of the
Company under this Indenture and the Securities (all the foregoing being
hereinafter collectively called the "Guaranteed Obligations"). Each Guarantor
further agrees that the Guaranteed Obligations may be extended or renewed, in
whole or in part, without notice or further assent from such Guarantor and that
such Guarantor will remain bound under this Article 11 notwithstanding any
extension or renewal of any Guaranteed Obligation.
<PAGE>

                                                                              94

          Each Guarantor waives presentation to, demand of, payment from and
protest to the Company of any of the Guaranteed Obligations and also waives
notice of protest for nonpayment. Each Guarantor waives notice of any default
under the Securities or the Guaranteed Obligations. The obligations of each
Guarantor hereunder shall not be affected by (a) the failure of any Holder or
the Trustee to assert any claim or demand or to enforce any right or remedy
against the Company or any other Person under this Indenture, the Securities or
any other agreement or otherwise; (b) any extension or renewal of any thereof;
(c) any rescission, waiver, amendment or modification of any of the terms or
provisions of this Indenture, the Securities or any other agreement; (d) the
release of any security held by any Holder or the Trustee for the Guaranteed
Obligations or any of them; (e) the failure of any Holder or the Trustee to
exercise any right or remedy against any other guarantor of the Obligations; or
(f) except as set forth in Section 11.06, any change in the ownership of such
Guarantor.

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

          Each Guaranty is, to the extent and in the manner set forth in Article
12, subordinated and subject in right of payment to the prior payment in full of
the principal of and premium, if any, and interest on all Senior Indebtedness of
the Guarantor giving such Guaranty and each Guaranty is made subject to such
provisions of this Indenture.

          Except as expressly set forth in Section 8.01(b), 11.02 and 11.06, the
obligations of each Guarantor hereunder shall not be subject to any reduction,
limitation, impairment or termination for any reason, including any claim of
waiver, release, surrender, alteration or compromise, and shall not be subject
to any defense of setoff, counterclaim, recoupment or termination whatsoever or
by reason of the invalidity, illegality or unenforceability of the Guaranteed
Obligations or otherwise. Without limiting the generality of the foregoing, the
obligations of each Guarantor herein shall not be discharged or impaired or
otherwise affected by the failure of any Holder or the Trustee to assert any
claim or demand or to enforce any remedy under this Indenture, the Securities or
any other agreement, by any waiver or modification of any thereof, by any
default, failure or delay, willful or otherwise, in the performance of the
obligations, or by any
<PAGE>

                                                                              95

other act or thing or omission or delay to do any other act or thing which may
or might in any manner or to any extent vary the risk of such Guarantor or would
otherwise operate as a discharge of such Guarantor as a matter of law or equity.

          Each Guarantor further agrees that its Guarantee herein shall continue
to be effective or be reinstated, as the case may be, if at any time payment, or
any part thereof, of principal of or interest on any Guaranteed Obligation is
rescinded or must otherwise be restored by any Holder or the Trustee upon the
bankruptcy or reorganization of the Company or otherwise.

          In furtherance of the foregoing and not in limitation of any other
right which any Holder or the Trustee has at law or in equity against any
Guarantor by virtue hereof, upon the failure of the Company to pay the principal
of or interest on any Guaranteed Obligation when and as the same shall become
due, whether at maturity, by acceleration, by redemption or otherwise, or to
perform or comply with any other Guaranteed Obligation, each Guarantor hereby
promises to and shall, upon receipt of written demand by the Trustee, forthwith
pay, or cause to be paid, in cash, to the Holders or the Trustee an amount equal
to the sum of (1) the unpaid amount of such Guaranteed Obligations, (2) accrued
and unpaid interest on such Guaranteed Obligations (but only to the extent not
prohibited by law) and (3) all other monetary Guaranteed Obligations of the
Company to the Holders and the Trustee.

          Each Guarantor agrees that it shall not be entitled to any right of
subrogation in respect of any Guaranteed Obligations until payment in full of
all Guaranteed Obligations and all obligations to which the Guaranteed
Obligations are subordinated as provided in Article 12. Each Guarantor further
agrees that, as between it, on the one hand, and the Holders and the Trustee, on
the other hand, (x) the maturity of the Guaranteed Obligations may be
accelerated as provided in Article 6 for the purposes of such Guarantor's
Guaranty herein, notwithstanding any stay, injunction or other prohibition
preventing such acceleration in respect of the Guaranteed Obligations, and (y)
in the event of any declaration of acceleration of such Guaranteed Obligations
as provided in Article 6, such Guaranteed Obligations (whether or not due and
payable) shall forthwith become due and payable by such Guarantor for the
purposes of this Section.

          Each Guarantor also agrees to pay any and all costs and expenses
(including reasonable attorneys' fees)
<PAGE>

                                                                              96

incurred by the Trustee or any Holder in enforcing any rights under this
Section.

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

          SECTION 11.03. Successors and Assigns. This Article 11 shall be
                         ----------------------
binding upon each Guarantor and its successors and assigns and shall enure to
the benefit of the successors and assigns of the Trustee and the Holders and, in
the event of any transfer or assignment of rights by any Holder or the Trustee,
the rights and privileges conferred upon that party in this Indenture and in the
Securities shall automatically extend to and be vested in such transferee or
assignee, all subject to the terms and conditions of this Indenture.

          SECTION 11.04. No Waiver. Neither a failure nor a delay on the part of
                         ---------
either the Trustee or the Holders in exercising any right, power or privilege
under this Article 11 shall operate as a waiver thereof, nor shall a single or
partial exercise thereof preclude any other or further exercise of any right,
power or privilege. The rights, remedies and benefits of the Trustee and the
Holders herein expressly specified are cumulative and not exclusive of any other
rights, remedies or benefits which either may have under this Article 11 at law,
in equity, by statute or otherwise.

          SECTION 11.05. Modification. No modification, amendment or waiver of
                         ------------
any provision of this Article 11, nor the consent to any departure by any
Guarantor therefrom, shall in any event be effective unless the same shall be in
writing and signed by the Trustee, and then such waiver or consent shall be
effective only in the specific instance and for the purpose for which given. No
notice to or demand on any Guarantor in any case shall entitle such Guarantor to
any other or further notice or demand in the same, similar or other
circumstances.

          SECTION 11.06. Release of Subsidiary Guarantor. Upon the sale
                         -------------------------------
(including any sale pursuant to any exercise of remedies by a holder of Senior
Indebtedness of the Company or of such Subsidiary Guarantor) or other
<PAGE>

                                                                              97

disposition (including by way of consolidation or merger) of a Subsidiary
Guarantor or the sale or disposition of all or substantially all the assets of
such Subsidiary Guarantor (in each case other than a sale or disposition to the
Company or an Affiliate of the Company), or at such time a Subsidiary Guarantor
no longer Guarantees any other Indebtedness of the Company, or upon designation
of a Subsidiary Guarantor as an Unrestricted Subsidiary pursuant to the terms of
this Indenture, such Subsidiary Guarantor shall be deemed released from all
obligations under this Article 11 without any further action required on the
part of the Trustee or any Holder. At the request of the Company, the Trustee
shall execute and deliver an appropriate instrument evidencing such release.

          SECTION 11.07. Contribution. Each Subsidiary Guarantor that makes a
                         ------------
payment under its Subsidiary Guaranty will be entitled upon payment in full of
all Guaranteed Obligations to a contribution from each other Subsidiary
Guarantor in an amount equal to such other Subsidiary Guarantor's pro rata
portion of such payment based on the respective net assets of all the Subsidiary
Guarantors at the time of such payment determined in accordance with GAAP.

                                  ARTICLE 12

                          Subordination of Guaranties
                         ----------------------------

          SECTION 12.01. Agreement To Subordinate. Each Guarantor agrees, and
                         ------------------------
each Securityholder by accepting a Security agrees, that the Indebtedness
evidenced by such Guarantor's Guaranty is subordinated in right of payment, to
the extent and in the manner provided in this Article 12, to the prior payment
of all Senior Indebtedness of such Guarantor and that the subordination is for
the benefit of and enforceable by the holders of such Senior Indebtedness. The
Guaranteed Obligations of a Guarantor shall in all respects rank pari passu with
                                                                 ---- -----
all other Senior Subordinated Indebtedness of such Guarantor and only Senior
Indebtedness of such Guarantor (including such Guarantor's Guaranty of Senior
Indebtedness of the Company) shall rank senior to the Guaranteed Obligations of
such Guarantor in accordance with the provisions set forth herein.

          SECTION 12.02. Liquidation, Dissolution, Bankruptcy. Upon any payment
                         ------------------------------------
or distribution of the assets of any Guarantor to creditors upon a total or
partial liqui-
<PAGE>

                                                                              98

dation or a total or partial dissolution of such Guarantor or in a bankruptcy,
reorganization, insolvency, receivership or similar proceeding relating to such
Guarantor or its property:

          (1) holders of Senior Indebtedness of such Guarantor shall be entitled
     to receive payment in full in cash of such Senior Indebtedness before
     Securityholders shall be entitled to receive any payment pursuant to the
     Guaranty of such Guarantor; and

           (2) until the Senior Indebtedness of any Guarantor is paid in full in
     cash, any payment or distribution to which Securityholders would be
     entitled but for this Article 12 shall be made to holders of such Senior
     Indebtedness as their interests may appear, except that Securityholders may
     receive shares of stock and any debt securities of such Guarantor that are
     subordinated to such Senior Indebtedness to at least the same extent as its
     Guaranty.

           SECTION 12.03. Default on Senior Indebtedness of Guarantor. No
                          -------------------------------------------
Guarantor shall make any payment on its Guaranty or purchase, redeem or
otherwise retire or defease any Securities or other Guaranteed Obligations
(collectively, "pay its Guaranty") if either of the following (a "Payment
Default") occurs (1) any Designated Senior Indebtedness of such Guarantor is not
paid in full in cash when due; or (2) any other default on Designated Senior
Indebtedness of such Guarantor occurs and the maturity of such Designated Senior
Indebtedness is accelerated in accordance with its terms; unless, in either
case, the Payment Default has been cured or waived and any such acceleration has
been rescinded or such Designated Senior Indebtedness has been paid in full in
cash; provided, however, that any Guarantor shall be entitled to pay its
      --------  -------
Guaranty without regard to the foregoing if such Guarantor and the Trustee
receive written notice approving such payment from the Representative of any
Designated Senior Indebtedness with respect to which the Payment Default has
occurred and is continuing. During the continuance of any default (other than a
Payment Default) with respect to any Designated Senior Indebtedness of such
Guarantor pursuant to which the maturity thereof may be accelerated immediately
without further notice (except such notice as may be required to effect such
acceleration) or the expiration of any applicable grace periods, such Guarantor
shall not pay its Guaranty for a period (a "Payment Blockage Period") commencing
upon the receipt by the Trustee of (with a copy to such Guarantor) written
notice (a "Blockage Notice") of such default from the Representative of such
Designated
<PAGE>

                                                                              99

Senior Indebtedness specifying an election to effect a Payment Blockage Period
and ending 179 days thereafter. The Payment Blockage Period shall end earlier if
such Payment Blockage Period is terminated (1) by written notice to the Trustee
and such Guarantor from the Person or Persons who gave such Blockage Notice; (2)
because the default giving rise to such Blockage Notice is cured, waived or
otherwise no longer continuing; or (3) because such Designated Senior
Indebtedness has been discharged or repaid in full in cash. Notwithstanding the
provisions described in the immediately preceding two sentences (but subject to
the provisions contained in the first sentence of this Section), unless the
holders of such Designated Senior Indebtedness giving such Payment Notice or the
Representative of such Designated Senior Indebtedness shall have accelerated the
maturity of such Designated Senior Indebtedness, any Guarantor shall be entitled
to resume payments pursuant to its Guaranty after termination of such Payment
Blockage Period. No Guarantor shall be subject to more than one Blockage Period
in any consecutive 360-day period, irrespective of the number of defaults with
respect to Designated Senior Indebtedness of such Guarantor during such period;
provided, however, that if any Blockage Notice within such 360-day period is
--------  -------
given by or on behalf of any holders of Designated Senior Indebtedness of such
Guarantor (other than the Bank Indebtedness), the Representative of the Bank
Indebtedness shall be entitled to give another Blockage Notice within such
period; provided further, however, that in no event shall the total number of
        ----------------  -------
days during which any Payment Blockage Period or Periods is in effect exceed 179
days in the aggregate during any 360-day consecutive period, and there must be
181 days during any 360-day consecutive period during which no Payment Blockage
Period is in effect. For purposes of this Section, no default or event of
default which existed or was continuing on the date of the commencement of any
Payment Blockage Period with respect to the Designated Senior Indebtedness of
such Guarantor initiating such Payment Blockage Period shall be, or be made, the
basis of the commencement of a subsequent Payment Blockage Period by the
Representative of such Designated Senior Indebtedness, whether or not within a
period of 360 consecutive days, unless such default or event of default shall
have been cured or waived for a period of not less than 90 consecutive days.

          SECTION 12.04.  Demand for Payment.  If a demand for payment is made
                          -------------------
on a Guarantor pursuant to Article 11, the Trustee shall promptly notify the
holders of the Designated Senior Indebtedness of such Guarantor (or their
Representatives) of such demand.
<PAGE>

                                                                             100

          SECTION 12.05. When Distribution Must Be Paid Over. If a distribution
                         -----------------------------------
is made to Securityholders that because of this Article 12 should not have been
made to them, the Securityholders who receive the distribution shall hold it in
trust for holders of Senior Indebtedness of the applicable Guarantor and pay it
over to them or their Representatives as their interests may appear. If any
Designated Senior Indebtedness of a Subsidiary Guarantor is outstanding, such
Subsidiary Guarantor shall not make a payment on its Guaranty until five
Business Days after the Representations of all the issuers of Designated Senior
Indebtedness of such Guarantor receive notice of such acceleration and,
thereafter, shall be entitled to pay the Securities only if Article 12 otherwise
permits payment at that time.

          SECTION 12.06. Subrogation. After all Senior Indebtedness of a
                         -----------
Guarantor is paid in full and until the Securities are paid in full,
Securityholders shall be subrogated to the rights of holders of such Senior
Indebtedness to receive distributions applicable to Senior Indebtedness of such
Guarantor. A distribution made under this Article 12 to holders of such Senior
Indebtedness which otherwise would have been made to Securityholders is not, as
between the relevant Guarantor and Securityholders, a payment by such Guarantor
on such Senior Indebtedness.

          SECTION 12.07. Relative Rights.  This Article 12 defines the relative
                         ----------------
rights of Securityholders and holders of Senior Indebtedness of a Guarantor.
Nothing in this Indenture shall:

          (1) impair, as between a Guarantor and Security holders, the
     obligation of such Guarantor, which is absolute and unconditional, to pay
     its Guaranty to the extent set forth in Article 11; or

          (2) prevent the Trustee or any Securityholder from exercising its
     available remedies upon a default by such Guarantor under its Guaranty,
     subject to the rights of holders of Senior Indebtedness of such Guarantor
     to receive distributions otherwise payable to Securityholders.

          SECTION 12.08. Subordination May Not Be Impaired by Company.  No right
                         ---------------------------------
of any holder of Senior Indebtedness of any Guarantor to enforce the
subordination of the Guaranty of such Guarantor shall be impaired by any act or
failure to act by such Guarantor or by its failure to comply with this
Indenture.

<PAGE>

                                                                             101

          SECTION 12.09. Rights of Trustee and Paying Agent. Notwithstanding
                         ----------------------------------
Section 12.03, the Trustee or Paying Agent shall continue to make payments on
any Guaranty and shall not be charged with knowledge of the existence of facts
that would prohibit the making of any such payments unless, not less than two
Business Days prior to the date of such payment, a Trust Officer of the Trustee
receives written notice satisfactory to it that such payments are prohibited by
this Article 12. The Company, the relevant Guarantor, the Registrar or co-
registrar, the Paying Agent, a Representative or a holder of Senior Indebtedness
of such Guarantor shall be entitled to give the notice; provided, however, that,
                                                        --------  -------
if an issue of Senior Indebtedness of any Guarantor has a Representative, only
the Representative shall be entitled to give the notice.

          The Trustee in its individual or any other capacity shall be entitled
to hold Senior Indebtedness of any Guarantor with the same rights it would have
if it were not the Trustee. The Registrar and co-registrar and the Paying Agent
may do the same with like rights. The Trustee shall be entitled to all the
rights set forth in this Article 12 with respect to any Senior Indebtedness of
any Guarantor which may at any time be held by it, to the same extent as any
other holder of such Senior Indebtedness; and nothing in Article 7 shall deprive
the Trustee of any of its rights as such holder. Nothing in this Article 12
shall apply to claims of, or payments to, the Trustee under or pursuant to
Section 7.07.

          SECTION 12.10. Distribution or Notice to Representative. Whenever any
                         ----------------------------------------
Person is to make a distribution or give a notice to holders of Senior
Indebtedness of any Guarantor, such Person shall be entitled to make such
distribution or give such notice to their Representative (if any).

          SECTION 12.11. Article 12 Not To Prevent Events of Default or Limit
                         ----------------------------------------------------
Right To Demand Payment. The failure to make a payment pursuant to a Guaranty by
-----------------------
reason of any provision in this Article 12 shall not be construed as preventing
the occurrence of a Default. Nothing in this Article 12 shall have any effect on
the right of the Securityholders or the Trustee to make a demand for payment on
any Guarantor pursuant to its Guaranty.

          SECTION 12.12. Trustee Entitled To Rely.  Upon any payment or
                         ------------------------
distribution pursuant to this Article 12, the Trustee and the Securityholders
shall be entitled to rely (1) upon any order or decree of a court of competent
jurisdiction in which any proceedings of the nature referred to
<PAGE>

                                                                             102

in Section 12.02 are pending, (2) upon a certificate of the liquidating trustee
or agent or other Person making such payment or distribution to the Trustee or
to the Securityholders or (3) upon the Representatives for the holders of
Senior Indebtedness of any Guarantor for the purpose of ascertaining the Persons
entitled to participate in such payment or distribution, the holders of such
Senior Indebtedness and other indebtedness of such Guarantor, the amount thereof
or payable thereon, the amount or amounts paid or distributed thereon and all
other facts pertinent thereto or to this Article 12. In the event that the
Trustee determines, in good faith, that evidence is required with respect to the
right of any Person as a holder of Senior Indebtedness of any Guarantor to
participate in any payment or distribution pursuant to this Article 12, the
Trustee shall be entitled to request such Person to furnish evidence to the
reasonable satisfaction of the Trustee as to the amount of Senior Indebtedness
of such Guarantor held by such Person, the extent to which such Person is
entitled to participate in such payment or distribution and other facts
pertinent to the rights of such Person under this Article 12, and, if such
evidence is not furnished, the Trustee shall be entitled to defer any payment to
such Person pending judicial determination as to the right of such Person to
receive such payment. The provisions of Sections 7.01 and 7.02 shall be
applicable to all actions or omissions of actions by the Trustee pursuant to
this Article 12.

          SECTION 12.13. Trustee To Effectuate Subordination. Each
                         -----------------------------------
Securityholder by accepting a Security authorizes and directs the Trustee on his
behalf to take such action as may be necessary or appropriate to acknowledge or
effectuate the subordination between the Securityholders and the holders of
Senior Indebtedness of any Guarantor as provided in this Article 12 and appoints
the Trustee as attorney-in-fact for any and all such purposes.

          SECTION 12.14. Trustee Not Fiduciary for Holders of Senior
                         -------------------------------------------
Indebtedness of Guarantor. The Trustee shall not be deemed to owe any fiduciary
-------------------------
duty to the holders of Senior Indebtedness of any Guarantor and shall not be
liable to any such holders if it shall mistakenly pay over or distribute to
Securityholders or the Company or any other Person, money or assets to which any
holders of such Senior Indebtedness shall be entitled by virtue of this Article
12 or otherwise.

          SECTION 12.15. Reliance by Holders of Senior Indebtedness of
                         ---------------------------------------------
Guarantors on Subordination Provisions. Each Securityholder by accepting a
---------------------------------------
Security acknowledges and agrees that the foregoing subordination provisions
are, and
<PAGE>

                                                                             103

are intended to be, an inducement and a consideration to each holder of any
Senior Indebtedness of any Guarantor, whether such Senior Indebtedness was
created or acquired before or after the issuance of the Securities, to acquire
and continue to hold, or to continue to hold, such Senior Indebtedness and such
holder of Senior Indebtedness shall be deemed conclusively to have relied on
such subordination provisions in acquiring and continuing to hold, or in
continuing to hold, such Senior Indebtedness.

                                  ARTICLE 13

                                 Miscellaneous
                                 -------------

          SECTION 13.01. Trust Indenture Act Controls. If any provision of this
                         ----------------------------
Indenture limits, qualifies or conflicts with another provision which is
required to be included in this Indenture by the TIA, the required provision
shall control.

          SECTION 13.02.  Notices.  Any notice or communication shall be in
                          --------
writing and delivered in person or mailed by first-class mail addressed as
follows:

     if to the Company or any Guarantor:

               BLUM CB Corp.
               909 Montgomery Street
               Suite 400
               San Francisco, California

               Attention of Alan Willis

     if to the Trustee:

               State Street Bank and Trust Company of
                 California, N.A.
               633 West 5th Street, 12th Floor
               Los Angeles, California 90071

               Attention:  Corporate Trust Administration
               (BLUM CB Corp. 11 1/4% Senior Subordinated Notes
               due June 15, 2011)

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

          Any notice or communication mailed to a Securityholder shall be mailed
to the Securityholder at the Secu-
<PAGE>

                                                                             104

rityholder's address as it appears on the registration books of the Registrar
and shall be sufficiently given if so mailed within the time prescribed.

          Failure to mail a notice or communication to a Securityholder or any
defect in it shall not affect its sufficiency with respect to other
Securityholders. If a notice or communication is mailed in the manner provided
above, it is duly given, whether or not the addressee receives it.

          SECTION 13.03. Communication by Holders with Other Holders.
                         -------------------------------------------
Securityholders may communicate pursuant to TIA (S) 312(b) with other
Securityholders with respect to their rights under this Indenture or the
Securities. The Company, any Guarantor, the Trustee, the Registrar and anyone
else shall have the protection of TIA (S) 312(c).

          SECTION 13.04. Certificate and Opinion as to Conditions Precedent.
                         --------------------------------------------------
Upon any request or application by the Company to the Trustee to take or refrain
from taking any action under this Indenture, the Company shall furnish to the
Trustee:

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

          (2) an Opinion of Counsel in form and substance reasonably
     satisfactory to the Trustee stating that, in the opinion of such counsel,
     all such conditions precedent have been complied with.

          SECTION 13.05. Statements Required in Certificate or Opinion. Each
                         ---------------------------------------------
certificate or opinion with respect to compliance with a covenant or condition
provided for in this Indenture shall include:

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

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

          (3) a statement that, in the opinion of such individual, he has made
     such examination or
<PAGE>

                                                                             105

     investigation as is necessary to enable him to express an informed opinion
     as to whether or not such covenant or condition has been complied with; and

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

          SECTION 13.06. When Securities Disregarded. In determining whether the
                         ---------------------------
Holders of the required principal amount of Securities have concurred in any
direction, waiver or consent, Securities owned by the Company or by any Person
directly or indirectly controlling or controlled by or under direct or indirect
common control with the Company shall be disregarded and deemed not to be
outstanding, except that, for the purpose of determining whether the Trustee
shall be protected in relying on any such direction, waiver or consent, only
Securities which the Trustee knows are so owned shall be so disregarded. Also,
subject to the fore going, only Securities outstanding at the time shall be
considered in any such determination.

          SECTION 13.07. Rules by Trustee, Paying Agent and Registrar. The
                         --------------------------------------------
Trustee may make reasonable rules for action by or a meeting of Securityholders.
The Registrar and the Paying Agent may make reasonable rules for their
functions.

          SECTION 13.08. Legal Holidays. A "Legal Holiday" is a Saturday, a
                         --------------
Sunday or a day on which commercial banking institutions are authorized or
required by law to close in New York City. If a payment date is a Legal Holiday,
payment shall be made on the next succeeding day that is not a Legal Holiday,
and no interest shall accrue for the intervening period. If a regular record
date is a Legal Holiday, the record date shall not be affected.

          SECTION 13.09. Governing Law.  This Indenture and the Securities shall
                         -------------
be governed by, and construed in accordance with, the laws of the State of New
York.

          SECTION 13.10. No Recourse Against Others. A director, officer,
                         --------------------------
employee or stockholder, as such, of the Company or any Guarantor shall not have
any liability for any obligations of the Company under the Securities or this
Indenture or of such Guarantor under its Guaranty or this Indenture or for any
claim based on, in respect of or by reason of such obligations or their
creation. By accepting a Security, each Securityholder shall waive and release
all such liability. The waiver and release shall be part of the consideration
for the issue of the Securities.
<PAGE>

                                                                             106

          SECTION 13.11. Successors.  All agreements of the Company and the
                         -----------
Guarantors in this Indenture and the Securities shall bind their respective
successors. All agreements of the Trustee in this Indenture shall bind its
successors.

          SECTION 13.12. Multiple Originals.  The parties may sign any number of
                         -------------------
copies of this Indenture. Each signed copy shall be an original, but all of them
together represent the same agreement. One signed copy is enough to prove this
Indenture.

          SECTION 13.13. Table of Contents; Headings. The table of contents,
                         ---------------------------
cross-reference sheet and headings of the Articles and Sections of this
Indenture have been inserted for convenience of reference only, are not intended
to be considered a part hereof and shall not modify or restrict any of the terms
or provisions hereof.
<PAGE>

                                                                             107

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

                                             BLUM CB CORP.,

                                                by /s/ Claus J. Moller
                                                  -------------------------
                                                  Name: Claus J. Moller
                                                  Title: President

                                             CBRE HOLDING, INC.,

                                                by /s/ Claus J. Moller
                                                  -------------------------
                                                  Name: Claus J. Moller
                                                  Title: President

                                             STATE STREET BANK AND TRUST
                                             COMPANY OF CALIFORNIA, N.A.,

                                                by /s/ Marc Henson
                                                  -------------------------
                                                  Name: Marc Henson
                                                  Title: Vice President
<PAGE>

                                                 RULE 144A/REGULATION S APPENDIX

                  PROVISIONS RELATING TO INITIAL SECURITIES,
                  ------------------------------------------
                          PRIVATE EXCHANGE SECURITIES
                          ---------------------------
                            AND EXCHANGE SECURITIES
                            -----------------------

     1.   Definitions
          -----------

     1.1  Definitions
          -----------

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

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

     "Exchange Securities" means (1) the 11 1/4% Senior Subordinated Notes Due
June 15, 2011 issued pursuant to the Indenture in connection with a Registered
Exchange Offer pursuant to a Registration Rights Agreement and (2) Additional
Securities, if any, issued pursuant to a registration statement filed with the
SEC under the Securities Act.

     "Initial Purchasers" means (1) with respect to the Initial Securities
issued on the Issue Date, Credit Suisse First Boston Corporation, Credit
Lyonnais Securities (USA) Inc., HSBC Securities (USA) Inc. and Scotia Capital
(USA) Inc. and (2) with respect to each issuance of Additional Securities, the
Persons purchasing such Additional Securities under the related Purchase
Agreement.

     "Initial Securities" means (1) $229.0 million aggregate principal amount of
11 1/4% Senior Subordinated Notes Due June 15, 2011 issued on the Issue Date and
(2) Additional Securities, if any, issued in a transaction exempt from the
registration requirements of the Securities Act.

     "Private Exchange" means the offer by the Company, pursuant to a
Registration Rights Agreement, to the Initial Purchasers to issue and deliver to
the Initial Purchasers, in exchange for the Initial Securities held by the
Initial Purchasers as part of its initial distribution, a like aggregate
principal amount of Private Exchange Securities.

     "Private Exchange Securities" means any 11 1/4% Senior Subordinated Notes
Due June 15, 2011 issued in connection with a Private Exchange.

     "Purchase Agreement" means (1) with respect to the Initial Securities
issued on the Issue Date, the Purchase Agreement dated May 31, 2001 among the
Company, Parent and
<PAGE>

                                                                               2

the Initial Purchasers, as such agreement has been amended on or prior to the
date hereof, and (2) with respect to each issuance of Additional Securities, the
purchase agreement or underwriting agreement among the Company, Parent and the
Persons purchasing such Additional Securities.

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

     "Registered Exchange Offer" means the offer by the Company, pursuant to a
Registration Rights Agreement, to certain Holders of Initial Securities, to
issue and deliver to such Holders, in exchange for the Initial Securities, a
like aggregate principal amount of Exchange Securities registered under the
Securities Act.

     "Registration Rights Agreement" means (1) with respect to the Initial
Securities issued on the Issue Date, the Registration Rights Agreement dated May
31, 2001 among the Company, Parent and the Initial Purchasers, and (2) with
respect to each issuance of Additional Securities issued in a transaction exempt
from the registration requirements of the Securities Act, the registration
rights agreement, if any, among the Company and the Persons purchasing such
Additional Securities under the related Purchase Agreement.

     "Securities" means the Initial Securities, the Exchange Securities and the
Private Exchange Securities, treated as a single class.

     "Securities Custodian" means the custodian with respect to a Global
Security (as appointed by the Depository), or any successor Person thereto and
shall initially be the Trustee.

     "Shelf Registration Statement" means the registration statement issued by
the Company in connection with the offer and sale of Initial Securities or
Private Exchange Securities pursuant to a Registration Rights Agreement.

     "Transfer Restricted Securities" means Securities that bear or are required
to bear the legend set forth in Section 2.3(b)hereto.

     1.2  Other Definitions
          -----------------

                                                             Defined in
     Term                                                      Section:
     ----                                                      -------

"Agent Members"............................................    2.1(b)
"Global Security"..........................................    2.1(a)
<PAGE>

                                                                               3

"Regulation S"..............................................   2.1(a)
"Restricted Global Security"................................   2.1(a)
"Rule 144A".................................................   2.1(a)

     2.   The Securities.
          ---------------

     2.1 (a) Form and Dating. Initial Securities offered and sold to QIBs in
             ---------------
reliance on Rule 144A under the Securities Act ("Rule 144A") or in reliance on
Regulation S under the Securities Act ("Regulation S"), in each case as provided
in a Purchase Agreement, and Private Exchange Securities, as provided in a
Registration Rights Agreement, shall be issued initially in the form of one or
more permanent global Securities in definitive, fully registered form without
interest coupons with the global securities legend and restricted securities
legend set forth in Exhibit 1 hereto (each, a "Restricted Global Security"),
which shall be deposited on behalf of the purchasers of the Initial Securities
represented thereby with the Trustee, at its principal corporate trust office,
as custodian for the Depository (or with such other custodian as the Depository
may direct), and registered in the name of the Depository or a nominee of the
Depository, duly executed by the Company and authenticated by the Trustee as
hereinafter provided. The aggregate principal amount of the Global Securities
may from time to time be increased or decreased by adjustments made on the
records of the Trustee and the Depository or its nominee as hereinafter
provided. Exchange Securities shall be issued in global form (with the global
securities legend set forth in Exhibit 1 hereto) or in certificated form at the
option of the Holders thereof from time to time. Exchange Securities issued in
global form and Restricted Global Securities are sometimes referred to in this
Appendix as "Global Securities."

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

     The Company shall execute and the Trustee shall, in accordance with this
Section 2.1(b), authenticate and deliver initially one or more Global Securities
that (a) shall be registered in the name of the Depository for such Global
Security or Global Securities or the nominee of such Depository and (b) shall be
delivered by the Trustee to such Depository or pursuant to such Depository's
instructions or held by the Trustee as custodian for the Depository.

     Members of, or participants in, the Depository ("Agent Members") shall have
no rights under this Indenture with respect to any Global Security held on their
behalf by the Depository or by the Trustee as the custodian of the
<PAGE>

                                                                               4

Depository or under such Global Security, and the Company, the Trustee and any
agent of the Company or the Trustee shall be entitled to treat the Depository as
the absolute owner of such Global Security for all purposes whatsoever.
Notwithstanding the foregoing, nothing herein shall prevent the Company, the
Trustee or any agent of the Company or the Trustee from giving effect to any
written certification, proxy or other authorization furnished by the Depository
or impair, as between the Depository and its Agent Members, the operation of
customary practices of such Depository governing the exercise of the rights of a
holder of a beneficial interest in any Global Security.

     (c)  Certificated Securities. Except as provided in this Section 2.1 or
          -----------------------
Section 2.3 or 2.4, owners of beneficial interests in Restricted Global
Securities shall not be entitled to receive physical delivery of certificated
Securities.

     2.2  Authentication. The Trustee shall authenticate and deliver: (1) on the
          --------------
Issue Date, an aggregate principal amount of $229.0 million 11 1/4% Senior
Subordinated Notes Due June 15, 2011, (2) any Additional Securities for an
original issue in an aggregate principal amount specified in the written order
of the Company pursuant to Section 2.02 of the Indenture and (3) Exchange
Securities or Private Exchange Securities for issue only in a Registered
Exchange Offer or a Private Exchange, respectively, pursuant to a Registration
Rights Agreement, for a like principal amount of Initial Securities, in each
case upon a written order of the Company signed by one Officer. Such order shall
specify the amount of the Securities to be authenticated and the date on which
the original issue of Securities is to be authenticated and, in the case of any
issuance of Additional Securities pursuant to Section 2.13 of the Indenture,
shall certify that such issuance is in compliance with Section 4.03 of the
Indenture.

     2.3  Transfer and Exchange.
          ---------------------

     (a)  Transfer and Exchange of Global Securities. (i) The transfer and
          ------------------------------------------
exchange of Global Securities or beneficial interests therein shall be effected
through the Depository, in accordance with this Indenture (including applicable
restrictions on transfer set forth herein, if any) and the procedures of the
Depository therefor. A transferor of a beneficial interest in a Global Security
shall deliver to the Registrar a written order given in accordance with the
Depositary's procedures containing information regarding the participant account
of the Depositary to be credited with a beneficial interest in the Global
Security. The Registrar shall, in accordance with such instructions instruct the
<PAGE>

                                                                               5

Depositary to credit to the account of the Person specified in such instructions
a beneficial interest in the Global Security and to debit the account of the
Person making the transfer the beneficial interest in the Global Security being
transferred.

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

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

     (b)   Legend.

     (i)   Except as permitted by the following paragraphs (ii), (iii) and (iv),
   each Security certificate evidencing the Restricted Global Securities (and
   all Securities issued in exchange therefor or in substitution thereof) shall
   bear a legend in substantially the following form:

     THIS SECURITY (OR ITS PREDECESSOR) WAS ORIGINALLY ISSUED IN A TRANSACTION
     EXEMPT FROM REGISTRATION UNDER THE SECURITIES ACT OF 1933 (THE "SECURITIES
     ACT"), AND THIS SECURITY MAY NOT BE OFFERED, SOLD OR OTHERWISE TRANSFERRED
     IN THE ABSENCE OF SUCH REGISTRATION OR AN APPLICABLE EXEMPTION THEREFROM.
     EACH PURCHASER OF THIS SECURITY IS HEREBY NOTIFIED THAT THE SELLER OF THIS
     SECURITY MAY BE RELYING ON THE EXEMPTION FROM THE PROVISIONS OF SECTION 5
     OF THE SECURITIES ACT PROVIDED BY RULE 144A THEREUNDER.

     THE HOLDER OF THIS SECURITY AGREES FOR THE BENEFIT OF THE COMPANY THAT (A)
     THIS NOTE MAY BE OFFERED, RESOLD, PLEDGED OR OTHERWISE TRANSFERRED, ONLY
     (I) THE COMPANY, (II) IN THE UNITED STATES TO A PERSON WHOM THE SELLER
     REASONABLY BELIEVES IS A QUALIFIED INSTITUTIONAL BUYER (AS DEFINED IN
<PAGE>

                                                                               6

     RULE 144A UNDER THE SECURITIES ACT) IN A TRANSACTION MEETING THE
     REQUIREMENTS OF RULE 144A, (III) OUTSIDE THE UNITED STATES IN AN OFFSHORE
     TRANSACTION IN ACCORDANCE WITH RULE 904 UNDER THE SECURITIES ACT, (IV)
     PURSUANT TO EXEMPTION FROM REGISTRATION UNDER THE SECURITIES ACT PROVIDED
     BY RULE 144 THEREUNDER (IF AVAILABLE) OR (V) PURSUANT TO AN EFFECTIVE
     REGISTRATION STATEMENT UNDER THE SECURITIES ACT, IN EACH OF CASES (I)
     THROUGH (V) IN ACCORDANCE WITH ANY APPLICABLE SECURITIES LAWS OF ANY STATE
     OF THE UNITED STATES, AND (B) THE HOLDER WILL, AND EACH SUBSEQUENT HOLDER
     IS REQUIRED TO, NOTIFY ANY PURCHASER OF THIS NOTE FROM IT OF THE RESALE
     RESTRICTIONS REFERRED TO IN (A) ABOVE.

     (ii)  Upon any sale or transfer of a Transfer Restricted Security
   (including any Transfer Restricted Security represented by a Restricted
   Global Security) pursuant to Rule 144 under the Securities Act, the Registrar
   shall permit the transferee thereof to exchange such Transfer Restricted
   Security for a certificated Security that does not bear the legend set forth
   above and rescind any restriction on the transfer of such Transfer Restricted
   Security, if the transferor thereof certifies in writing to the Registrar
   that such sale or transfer was made in reliance on Rule 144 (such
   certification to be in the form set forth on the reverse of the Security).

     (iii) After a transfer of any Initial Securities or Private Exchange
   Securities pursuant to and during the period of the effectiveness of a Shelf
   Registration Statement with respect to such Initial Securities or Private
   Exchange Securities, as the case may be, all requirements pertaining to
   legends on such Initial Security or such Private Exchange Security will cease
   to apply, the requirements requiring any such Initial Security or such
   Private Exchange Security issued to certain Holders be issued in global form
   will cease to apply, and a certificated Initial Security or Private Exchange
   Security or an Initial Security or Private Exchange Security in global form,
   in each case without restrictive transfer legends, will be available to the
   transferee of the Holder of such Initial Securities or Private Exchange
   Securities upon exchange of such transferring Holder's certificated Initial
   Security or Private Exchange Security or directions to transfer such Holder's
   interest in the Global Security, as applicable.

     (iv)  Upon the consummation of a Registered Exchange Offer with respect to
   the Initial Securities, all requirements pertaining to such Initial
   Securities that Initial Securities issued to certain Holders be issued in
   global form will still apply with respect to Holders of such Initial
   Securities that do not exchange their Initial Securities, and Exchange
<PAGE>

                                                                               7

   Securities in certificated or global form will be available to Holders that
   exchange such Initial Securities in such Registered Exchange Offer.

     (v)   Upon the consummation of a Private Exchange with respect to the
   Initial Securities, all requirements pertaining to such Initial Securities
   that Initial Securities issued to certain Holders be issued in global form
   will still apply with respect to Holders of such Initial Securities that do
   not exchange their Initial Securities, and Private Exchange Securities in
   global form with the global securities legend and the Restricted Securities
   Legend set forth in Exhibit 1 hereto will be available to Holders that
   exchange such Initial Securities in such Private Exchange.

     (c)   Cancellation or Adjustment of Global Security. At such time as all
           ---------------------------------------------
beneficial interests in a Global Security have either been exchanged for
certificated Securities, redeemed, purchased or canceled, such Global Security
shall be returned to the Depository for cancellation or retained and canceled by
the Trustee. At any time prior to such cancellation, if any beneficial interest
in a Global Security is exchanged for certificated Securities, redeemed,
purchased or canceled, the principal amount of Securities represented by such
Global Security shall be reduced and an adjustment shall be made on the books
and records of the Trustee (if it is then the Securities Custodian for such
Global Security) with respect to such Global Security, by the Trustee or the
Securities Custodian, to reflect such reduction.

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

     (i)   To permit registrations of transfers and exchanges, the Company shall
   execute and the Trustee shall authenticate certificated Securities and Global
   Securities at the Registrar's or co-registrar's request.

     (ii)  No service charge shall be made for any registration of transfer or
   exchange, but the Company may require payment of a sum sufficient to cover
   any transfer tax, assessments, or similar governmental charge payable in
   connection therewith (other than any such transfer taxes, assessments or
   similar governmental charge payable upon exchange or transfer pursuant to
   Sections 2.06, 3.06 and 4.09 of the Indenture).

     (iii) The Registrar or co-registrar shall not be required to register the
   transfer of or exchange of any Security for a period beginning 15 Business
   Days before the mailing of a notice of an offer to repurchase or redeem
   Securities or 15 Business Days before an interest payment date.
<PAGE>

                                                                               8

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

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

     (e)   No Obligation of the Trustee.
           ----------------------------

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

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

                                                                               9

   same to determine substantial compliance as to form with the express
   requirements hereof.

   2.4  Certificated Securities.
        -----------------------

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

     (b)  Any Restricted Global Security that is transferable to the beneficial
owners thereof pursuant to this Section shall be surrendered by the Depository
to the Trustee located at its principal corporate trust office in the Borough of
Manhattan, The City of New York, to be so transferred, in whole or from time to
time in part, without charge, and the Trustee shall authenticate and deliver,
upon such transfer of each portion of such Restricted Global Security, an equal
aggregate principal amount of certificated Initial Securities of authorized
denominations. Any portion of a Restricted Global Security transferred pursuant
to this Section shall be executed, authenticated and delivered only in
denominations of $1,000 principal amount and any integral multiple thereof and
registered in such names as the Depository shall direct. Any certificated
Initial Security or Private Exchange Security delivered in exchange for an
interest in the Restricted Global Security shall, except as otherwise provided
by Section 2.3(b), bear the restricted securities legend set forth in Exhibit 1
hereto.

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

     (d)  In the event of the occurrence of either of the events specified in
Section 2.4(a), the Company shall promptly make
<PAGE>

                                                                              10

available to the Trustee a reasonable supply of certificated Securities in
definitive, fully registered form without interest coupons.
<PAGE>

                                                                       EXHIBIT 1
                                                                              to
                                                 RULE 144A/REGULATION S APPENDIX

                      [FORM OF FACE OF INITIAL SECURITY]

                          [Global Securities Legend]

     UNLESS THIS CERTIFICATE IS PRESENTED BY AN AUTHORIZED REPRESENTATIVE OF THE
DEPOSITARY TRUST COMPANY, A NEW YORK CORPORATION ("DTC"), NEW YORK, NEW YORK, TO
THE COMPANY OR ITS AGENT FOR REGISTRATION OF TRANSFER, EXCHANGE OR PAYMENT, AND
ANY CERTIFICATE ISSUED IS REGISTERED IN THE NAME OF CEDE & CO. OR SUCH OTHER
NAME AS IS REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF DTC (AND ANY PAYMENT IS
MADE TO CEDE & CO., OR TO SUCH OTHER ENTITY AS IS REQUESTED BY AN AUTHORIZED
REPRESENTATIVE OF DTC) ANY TRANSFER, PLEDGE OR OTHER USE HEREOF FOR VALUE OR
OTHERWISE BY OR TO ANY PERSON IS WRONGFUL INASMUCH AS THE REGISTERED OWNER
HEREOF, CEDE & CO., HAS AN INTEREST HEREIN.

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

     [FOR REGULATION S GLOBAL NOTE ONLY] UNTIL 40 DAYS AFTER THE COMMENCEMENT OF
THE OFFERING, AN OFFER OR SALE OF NOTES WITHIN THE UNITED STATES BY A DEALER (AS
DEFINED IN THE U.S. SECURITIES ACT) MAY VIOLATE THE REGISTRATION REQUIREMENTS OF
THE U.S. SECURITIES ACT IF SUCH OFFER OR SALE IS MADE OTHERWISE THAN IN
ACCORDANCE WITH RULE 144A THEREUNDER.

                        [Restricted Securities Legend]

     THIS SECURITY (OR ITS PREDECESSOR) WAS ORIGINALLY ISSUED IN A TRANSACTION
EXEMPT FROM REGISTRATION UNDER THE SECURITIES ACT OF 1933 (THE "SECURITIES
ACT"), AND THIS SECURITY MAY NOT BE OFFERED, SOLD OR OTHERWISE TRANSFERRED OF IN
THE ABSENCE OF SUCH REGISTRATION OR AN APPLICABLE EXEMPTION THEREFROM. EACH
PURCHASER OF THIS SECURITY IS HEREBY NOTIFIED THAT THE SELLER OF THIS SECURITY
MAY BE RELYING ON THE EXEMPTION FROM THE PROVISIONS OF SECTION 5 OF THE
SECURITIES ACT PROVIDED BY RULE 144A THEREUNDER.

     THE HOLDER OF THIS SECURITY AGREES FOR THE BENEFIT OF THE COMPANY THAT (A)
THIS NOTE MAY BE OFFERED, RESOLD, PLEDGED OR OTHERWISE TRANSFERRED, ONLY (I) THE
COMPANY, (II) IN THE UNITED STATES TO A PERSON WHOM THE SELLER REASONABLY
BELIEVES IS A QUALIFIED INSTITUTIONAL BUYER (AS DEFINED IN RULE 144A UNDER THE
SECURITIES ACT) IN A TRANSACTION MEETING THE
<PAGE>

                                                                               2

REQUIREMENTS OF RULE 144A, (III) OUTSIDE THE UNITED STATES IN AN OFFSHORE
TRANSACTION IN ACCORDANCE WITH RULE 904 UNDER THE SECURITIES ACT, (IV) PURSUANT
TO AN EXEMPTION FROM REGISTRATION UNDER THE SECURITIES ACT PROVIDED BY RULE 144
THEREUNDER (IF AVAILABLE) OR (V) PURSUANT TO AN EFFECTIVE REGISTRATION STATEMENT
UNDER THE SECURITIES ACT, IN EACH OF CASES (I) THROUGH (V) IN ACCORDANCE WITH
ANY APPLICABLE SECURITIES LAWS OF ANY STATE OF THE UNITED STATES, AND (B) THE
HOLDER WILL, AND EACH SUBSEQUENT HOLDER IS REQUIRED TO, NOTIFY ANY PURCHASER OF
THIS NOTE FROM IT OF THE RESALE RESTRICTIONS REFERRED TO IN (A) ABOVE.
<PAGE>

                                                                               3

                                                                 CUSIP
                                                                       ---------

No.
    -------------                                                    $
                                                                       ---------

              11 1/4% Senior Subordinated Notes Due June 15, 2011

           Blum CB Corp., a Delaware corporation, promises to pay to
                 , or registered assigns, the principal sum of
                           Dollars on June 15, 2011.

           Interest Payment Dates:  June 15 and December 15.

           Record Dates:  June 1 and December 1.

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

Dated: June 7, 2001

                                                     BLUM CB CORP.,

                                                       by

                                                         Name:
                                                         Title:

TRUSTEE'S CERTIFICATE OF
     AUTHENTICATION

STATE STREET BANK AND TRUST
  COMPANY OF CALIFORNIA, N.A.
  as Trustee, certifies that
    this is one of the
    Securities referred to in
    the Indenture.

  by

          Authorized Signatory
<PAGE>

                                                                               4

                  [FORM OF REVERSE SIDE OF INITIAL SECURITY]

              11 1/4% Senior Subordinated Note Due June 15, 2011

1.    Interest
      --------

     Blum CB Corp., a Delaware corporation (such corporation, and its successors
and assigns under the Indenture hereinafter referred to, being herein called the
"Company"), promises to pay interest on the principal amount of this Security at
the rate per annum shown above; provided, however, that if a Registration
                                -----------------
Default (as defined in the Registration Rights Agreement) occurs, additional
interest will accrue on this Security at a rate of 0.50% per annum (increasing
by an additional 0.50% per annum after each consecutive 90-day period that
occurs after the date on which such Registration Default occurs up to a maximum
additional interest rate of 2.00%) from and including the date on which any such
Registration Default shall occur to but excluding the date on which all
Registration Defaults have been cured. The Company will pay interest
semiannually on June 15 and December 15 of each year, commencing December 15,
2001. Interest on the Securities will accrue from the most recent date to which
interest has been paid or, if no interest has been paid, from June 7, 2001.
Interest will be computed on the basis of a 360-day year of twelve 30-day
months.

2.    Method of Payment
      -----------------

     The Company will pay interest on the Securities (except defaulted interest)
to the Persons who are registered holders of Securities at the close of business
on the June 1 or December 1 next preceding the interest payment date even if
Securities are canceled after the record date and on or before the interest
payment date. Holders must surrender Securities to a Paying Agent to collect
principal payments. The Company will pay principal and interest in money of the
United States that at the time of payment is legal tender for payment of public
and private debts. Payments in respect of the Securities represented by a Global
Security (including principal, premium and interest) will be made by wire
transfer of immediately available funds to the accounts specified by The
Depository Trust Company. The Company will make all payments in respect of a
certificated Security (including principal, premium and interest) by mailing a
check to the registered address of each Holder thereof; provided, however, that
                                                        -----------------
payments on a certificated Security will be made by wire transfer to a U.S.
dollar account maintained by the payee with
<PAGE>

                                                                               5

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

3.   Paying Agent and Registrar
     --------------------------

     Initially, State Street Bank and Trust Company of California, N.A. (the
"Trustee"), will act as Paying Agent and Registrar. The Company may appoint and
change any Paying Agent, Registrar or co-registrar without notice. The Company
or any of its domestically incorporated Wholly Owned Subsidiaries may act as
Paying Agent, Registrar or co- registrar.

4.   Indenture
     ---------

     The Company issued the Securities under an Indenture dated as of June 7,
2001 ("Indenture"), between the Company, Parent and the Trustee. The terms of
the Securities include those stated in the Indenture and those made part of the
Indenture by reference to the Trust Indenture Act of 1939 (15 U.S.C. ss.ss.
77aaa-77bbbb) as in effect on the date of the Indenture (the "Act"). Terms
defined in the Indenture and not defined herein have the meanings ascribed
thereto in the Indenture. The Securities are subject to all such terms, and
Securityholders are referred to the Indenture and the Act for a statement of
those terms.

     The Securities are general unsecured obligations of the Company. The
Company shall be entitled, subject to its compliance with Section 4.03 of the
Indenture, to issue Additional Securities pursuant to Section 2.13 of the
Indenture. The Initial Securities issued on the Issue Date, any Additional
Securities and all Exchange Securities or Private Exchange Securities issued in
exchange therefor will be treated as a single class for all purposes under the
Indenture. The Indenture contains covenants that limit the ability of the
Company and its subsidiaries to incur additional indebtedness; pay dividends or
distributions on, or redeem or repurchase capital stock; make investments; issue
or sell capital stock of subsidiaries; engage in transactions with affiliates;
transfer or sell assets; guarantee indebtedness; restrict dividends or other
payments of subsidiaries; and consolidate, merge or transfer all or
substantially all of its assets and the assets of its
<PAGE>

                                                                               6

subsidiaries. These covenants are subject to important exceptions and
qualifications.

5.   Optional Redemption
     -------------------

     Except as set forth below, the Company shall not be entitled to redeem the
Securities at its option prior to June 15, 2006.

     On and after June 15, 2006, the Company shall be entitled at its option to
redeem all or a portion of the Securities upon not less than 30 nor more than 60
days' notice, at the redemption prices (expressed in percentages of principal
amount on the redemption date), plus accrued interest to the redemption date
(subject to the right of Holders of record on the relevant record date to
receive interest due on the related interest payment date), if redeemed during
the 12-month period commencing on June 15 of the years set forth below:

                                             Redemption
     Period                                    Price
     ------                                  ----------

     2006                                    105.625%
     2007                                    103.750
     2008                                    101.875
     2009 and thereafter                     100.000%

     In addition, prior to June 15, 2004, the Company shall be entitled at its
option on one or more occasions to redeem Securities (which includes Additional
Securities, if any) in an aggregate principal amount not to exceed 35% of the
aggregate principal amount of the Securities (which includes Additional
Securities, if any) originally issued at a redemption price (expressed as a
percentage of principal amount) of 111 1/4%, plus accrued and unpaid interest to
the redemption date, with the net cash proceeds from one or more Public Equity
Offerings (provided that if the Public Equity Offering is an offering by Parent,
           --------
a portion of the Net Cash Proceeds thereof equal to the amount required to
redeem any Securities is contributed to the equity capital of the Company);
provided, however, that (1) at least 65% of such aggregate principal amount of
--------  -------
Securities (which includes Additional Securities, if any) remains outstanding
immediately after the occurrence of each such redemption (other than Securities
held, directly or indirectly, by the Company or its Affiliates); and (2) each
such redemption occurs within 90 days after the date of the related Public
Equity Offering.
<PAGE>

                                                                               7

6.   Special Mandatory Redemption
     ----------------------------

     In the event the Transactions are not consummated on or prior to the 75th
day after the Issue Date or the Merger Agreement is terminated at any time prior
thereto, the Company shall redeem the Securities at a redemption price equal to
100% of the accreted value thereof on the redemption date (calculated for the
period from the Issue Date to such redemption date based on the straight line
method over the life of the Securities), plus accrued and unpaid interest to the
redemption date (subject to the right of Holders of record on the relevant
record date to receive interest due on the related interest payment date). The
Company shall be entitled to receive a credit against the accreted value of the
Securities required to be redeemed pursuant to this paragraph equal to the
accreted value on such redemption date (excluding premium) of any Securities
that the Company has acquired or redeemed other than pursuant to this paragraph
and has delivered to the Trustee for cancellation. The Company shall be entitled
to receive the credit only once for any Security. The Company shall cause the
notice of the special mandatory redemption to be mailed no later than the next
Business Day following the 75th day after the Issue Date or following the date
the Merger Agreement is terminated, as applicable, and shall redeem the
Securities three Business Days following the date of notice of redemption.

7.   Notice of Redemption
     --------------------

     Except as set forth in paragraph 6 above, notice of redemption will be
mailed at least 30 days but not more than 60 days before the redemption date to
each Holder of Securities to be redeemed at his registered address. Securities
in denominations larger than $1,000 principal amount may be redeemed in part but
only in whole multiples of $1,000. If money sufficient to pay the redemption
price of and accrued interest on all Securities (or portions thereof) to be
redeemed on the redemption date is deposited with the Paying Agent on or before
the redemption date and certain other conditions are satisfied, on and after
such date interest ceases to accrue on such Securities (or such portions
thereof) called for redemption.

8.   Put Provisions
     --------------

     Upon a Change of Control, any Holder of Securities will have the right,
subject to certain conditions, to cause the Company to purchase all or any part
of the Securities of such Holder at a purchase price equal to 101% of the
principal amount
<PAGE>

                                                                               8

thereof on the date of purchase plus accrued and unpaid interest to the date of
repurchase (subject to the right of holders of record on the relevant record
date to receive interest due on the related interest payment date) as provided
in, and subject to the terms of, the Indenture.

9.   Subordination
     -------------

     The Securities are subordinated to Senior Indebtedness of the Company, as
defined in the Indenture. To the extent provided in the Indenture, Senior
Indebtedness of the Company must be paid before the Securities may be paid. The
Company agrees, and each Securityholder by accepting a Security agrees, to the
subordination provisions contained in the Indenture and authorizes the Trustee
to give it effect and appoints the Trustee as attorney-in-fact for such purpose.

10.  Guaranty
     --------

     The payment by the Company of the principal of, and premium and interest
on, the Securities is fully and unconditionally guaranteed on a joint and
several senior subordinated basis by each of the Guarantors.

11.  Denominations; Transfer; Exchange
     ---------------------------------

     The Securities are in registered form without coupons in denominations of
$1,000 principal amount and whole multiples of $1,000. A Holder may transfer or
exchange Securities in accordance with the Indenture. The Registrar may require
a Holder, among other things, to furnish appropriate endorsements or transfer
documents and to pay any taxes and fees required by law or permitted by the
Indenture. The Registrar need not register the transfer of or exchange any
Securities selected for redemption (except, in the case of a Security to be
redeemed in part, the portion of the Security not to be redeemed) or any
Securities for a period of 15 days before a selection of Securities to be
redeemed or 15 days before an interest payment date.

12.  Persons Deemed Owners
     ---------------------

     The registered Holder of this Security may be treated as the owner of it
for all purposes.

13.  Unclaimed Money
     ---------------
<PAGE>

                                                                               9

     If money for the payment of principal or interest remains unclaimed for two
years, the Trustee or Paying Agent shall pay the money back to the Company at
its request unless an abandoned property law designates another Person. After
any such payment, Holders entitled to the money must look only to the Company
and not to the Trustee for payment.

14.  Discharge and Defeasance
     ------------------------

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

15.  Amendment, Waiver
     -----------------

     Subject to certain exceptions set forth in the Indenture, (i) the Indenture
and the Securities may be amended with the written consent of the Holders of at
least a majority in principal amount outstanding of the Securities and (ii) any
default or noncompliance with any provision may be waived with the written
consent of the Holders of a majority in principal amount outstanding of the
Securities. Subject to certain exceptions set forth in the Indenture, without
the consent of any Securityholder, the Company, the Guarantors and the Trustee
shall be entitled to amend the Indenture or the Securities to cure any
ambiguity, omission, defect or inconsistency, or to comply with Article 5 of the
Indenture, or to provide for uncertificated Securities in addition to or in
place of certificated Securities, or to add guarantees with respect to the
Securities, including Guaranties, or to secure the Securities, or to add
additional covenants or surrender rights and powers conferred on the Company or
the Guarantors, or to comply with any request of the SEC in connection with
qualifying the Indenture under the Act or to make any change that does not
adversely affect the rights of any Securityholder.

16.  Defaults and Remedies
     ---------------------

     Under the Indenture, Events of Default include (i) default for 30 days in
payment of interest on the Securities; (ii) default in payment of principal on
the Securities at maturity, upon redemption pursuant to paragraph 5 or 6 of the
Securities, upon acceleration or otherwise, or failure by the Company to redeem
or purchase Securities when required;
<PAGE>

                                                                              10

(iii) failure by the Company, Parent or any Subsidiary Guarantor to comply with
other agreements in the Indenture or the Securities, in certain cases subject to
notice and lapse of time; (iv) certain accelerations (including failure to pay
within any grace period after final maturity) of other Indebtedness of the
Company or any Significant Subsidiary if the amount accelerated (or so unpaid)
exceeds $10.0 million; (v) certain events of bankruptcy or insolvency with
respect to the Company and the Significant Subsidiaries; (vi) certain judgments
or decrees for the payment of money in excess of $10.0 million; and (vii)
certain defaults with respect to Guaranties. If an Event of Default occurs and
is continuing, the Trustee or the Holders of at least 25% in principal amount of
the Securities may declare all the Securities to be due and payable immediately.
Certain events of bankruptcy or insolvency are Events of Default which will
result in the Securities being due and payable immediately upon the occurrence
of such Events of Default.

     Securityholders may not enforce the Indenture or the Securities except as
provided in the Indenture. The Trustee may refuse to enforce the Indenture or
the Securities unless it receives indemnity or security satisfactory to it.
Subject to certain limitations, Holders of a majority in principal amount of the
Securities may direct the Trustee in its exercise of any trust or power. The
Trustee may withhold from Securityholders notice of any continuing Default
(except a Default in payment of principal or interest) if it determines that
withholding notice is in the interest of the Holders.

17.  Trustee Dealings with the Company
     ---------------------------------

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

18.  No Recourse Against Others
     --------------------------

     A director, officer, employee or stockholder, as such, of the Company or
the Trustee shall not have any liability for any obligations of the Company
under the Securities or the Indenture or for any claim based on, in respect of
or by reason of such obligations or their creation. By accepting a Security,
each Securityholder waives and releases all such
<PAGE>

                                                                              11

liability. The waiver and release are part of the consideration for the issue of
the Securities.

19.  Authentication
     --------------

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

20.  Abbreviations
     -------------

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

21.  CUSIP Numbers
     -------------

          Pursuant to a recommendation promulgated by the Committee on Uniform
Security Identification Procedures the Company has caused CUSIP numbers to be
printed on the Securities and has directed the Trustee to use CUSIP numbers in
notices of redemption as a convenience to Securityholders. No representation is
made as to the accuracy of such numbers either as printed on the Securities or
as contained in any notice of redemption and reliance may be placed only on the
other identification numbers placed thereon.

22.  Holders' Compliance with Registration Rights Agreement.
     ------------------------------------------------------

          Each Holder of a Security, by acceptance hereof, acknowledges and
agrees to the provisions of the Registration Rights Agreement, including the
obligations of the Holders with respect to a registration and the
indemnification of the Company to the extent provided therein.

23.  Governing Law.
     --------------

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

          The Company will furnish to any Securityholder upon written request
and without charge to the Securityholder a
<PAGE>

                                                                              12

copy of the Indenture which has in it the text of this Security in larger type.
Requests may be made to:

                  BLUM CB Corp.
                  909 Montgomery Street
                  Suite 400
                  San Francisco, California 94133

                  Attention: Alan Willis
<PAGE>

                                                                              13

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

                                ASSIGNMENT FORM

To assign this Security, fill in the form below:

I or we assign and transfer this Security to

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

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

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

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

Date: ________________                     Your Signature: _____________________

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

In connection with any transfer of any of the Securities evidenced by this
certificate occurring prior to the expiration of the period referred to in Rule
144(k) under the Securities Act after the later of the date of original issuance
of such Securities and the last date, if any, on which such Securities were
owned by the Company or any Affiliate of the Company, the undersigned confirms
that such Securities are being transferred in accordance with its terms:

CHECK ONE BOX BELOW

          (1)  [_]  to the Company; or

          (2)  [_]  pursuant to an effective registration statement under the
                    Securities Act of 1933; or

          (3)  [_]  inside the United States to a "qualified institutional
                    buyer" (as defined in Rule 144A under the Securities Act of
                    1933) that purchases for its own account or for the account
                    of a qualified institutional buyer to whom notice is given
                    that such transfer is being made in reliance on Rule 144A,
                    in each
<PAGE>

                                                                              14

                    case pursuant to and in compliance with Rule 144A under the
                    Securities Act of 1933; or

          (4)  [_]  outside the United States in an offshore transaction within
                    the meaning of Regulation S under the Securities Act in
                    compliance with Rule 904 under the Securities Act of 1933;
                    or

          (5)  [_]  pursuant to the exemption from registration provided by Rule
                    144 under the Securities Act of 1933.

               If such transfer is being made pursuant to an offshore
transaction in accordance with Rule 904 under the Securities Act, the
undersigned further certifies that :

               (i)   the offer of the Securities was not made to a person in the
          United States;

               (ii)  either (a) at the time the buy offer was originated, the
          transferee was outside the United States or we and any person acting
          on our behalf reasonably believed that the transferee was outside the
          United States, or (b) the transaction was executed in, on or through
          the facilities of a designated off-shore securities market and neither
          we nor any person acting on our behalf knows that the transaction has
          been pre-arranged with a buyer in the United States;

               (iii) no directed selling efforts have been made in the United
          States in contravention of the requirements of Rule 903 or Rule 904 of
          Regulation S, as applicable;

               (iv)  the transaction is not part of a plan or scheme to evade
          the registration requirements of the Securities Act;

               (v)   we have advised the transferee of the transfer restrictions
          applicable to the Securities; and

               (vi)  if the circumstances set forth in Rule 904(b) under the
          Securities Act are applicable, we have complied with the additional
          conditions therein, including (if applicable) sending a confirmation
          or other notice stating that the Securities may be offered and sold
          during the distribution compliance period specified in Rule 903 of
          Regulation S; pursuant to registration of the Securities under the
          Securities Act; or pursuant to an available exemption from the
          registration requirements under the Securities Act.
<PAGE>

                                                                              15

     Unless one of the boxes is checked, the Trustee will refuse to register any
     of the Securities evidenced by this certificate in the name of any person
     other than the registered holder thereof; provided, however, that if box
                                               --------  -------
     (4) or (5) is checked, the Trustee shall be entitled to require, prior to
     registering any such transfer of the Securities, such legal opinions,
     certifications and other information as the Company has reasonably
     requested to confirm that such transfer is being made pursuant to an
     exemption from, or in a transaction not subject to, the registration
     requirements of the Securities Act of 1933, such as the exemption provided
     by Rule 144 under such Act.

                              __________________________________
                                           Signature

Signature Guarantee:

____________________________              ______________________________________
Signature must be guaranteed              Signature

     Signatures must be guaranteed by an "eligible guarantor institution"
meeting the requirements of the Registrar, which requirements include membership
or participation in the Security Transfer Agent Medallion Program ("STAMP") or
such other "signature guarantee program" as may be determined by the Registrar
in addition to, or in substitution for, STAMP, all in accordance with the
Securities Exchange Act of 1934, as amended.

________________________________________________________________________________

             TO BE COMPLETED BY PURCHASER IF (3) ABOVE IS CHECKED.

     The undersigned represents and warrants that it is purchasing this Security
for its own account or an account with respect to which it exercises sole
investment discretion and that it and any such account is a "qualified
institutional buyer" within the meaning of Rule 144A under the Securities Act of
1933, and is aware that the sale to it is being made in reliance on Rule 144A
and acknowledges that it has received such information regarding the Company as
the undersigned has requested pursuant to Rule 144A or has determined not to
<PAGE>

                                                                              16

request such information and that it is aware that the transferor is relying
upon the undersigned's foregoing representations in order to claim the exemption
from registration provided by Rule 144A.

Dated: _________________                          ______________________________
                                                  NOTICE:  To be executed by
                                                           an executive officer
<PAGE>

                                                                              17

                     [TO BE ATTACHED TO GLOBAL SECURITIES]

             SCHEDULE OF INCREASES OR DECREASES IN GLOBAL SECURITY

                  The following increases or decreases in this Global Security
have been made:

<TABLE>
<CAPTION>
Date of         Amount of decrease    Amount of increase    Principal amount      Signature of
Exchange        in Principal          in Principal          of this Global        authorized officer
                amount of this        amount of this        Security following    of Trustee or
                Global Security       Global Security       such decrease or      Securities
                                                            increase)             Custodian
<S>             <C>                   <C>                   <C>                   <C>
</TABLE>
<PAGE>

                                                                              18

                      OPTION OF HOLDER TO ELECT PURCHASE

          If you want to elect to have this Security purchased by the Company
pursuant to Section 4.06 or 4.09 of the Indenture, check the box:
                                 [_]

          If you want to elect to have only part of this Security purchased by
the Company pursuant to Section 4.06 or 4.09 of the Indenture, state the amount
in principal amount: $

Date: _______________               Your Signature: ____________________________
                                                    (Sign exactly as your name
                                                    appears on the other side of
                                                    this Security.)

Signature Guarantee: ________________________________________________
                              (Signature must be guaranteed)

     Signatures must be guaranteed by an "eligible guarantor institution"
meeting the requirements of the Registrar, which requirements include membership
or participation in the Security Transfer Agent Medallion Program ("STAMP") or
such other "signature guarantee program" as may be determined by the Registrar
in addition to, or in substitution for, STAMP, all in accordance with the
Securities Exchange Act of 1934, as amended.
<PAGE>

                                                                       EXHIBIT A

                      [FORM OF FACE OF EXCHANGE SECURITY
                         OR PRIVATE EXCHANGE SECURITY]

*/If the Security is to be issued in global form add the Global Securities
-
Legend from Exhibit 1 to Appendix A and the attachment from such Exhibit 1
captioned "[TO BE ATTACHED TO GLOBAL SECURITIES] - SCHEDULE OF INCREASES OR
DECREASES IN GLOBAL SECURITY".

**/If the Security is a Private Exchange Security issued in a Private Exchange
--
to an Initial Purchaser holding an unsold portion of its initial allotment, add
the Restricted Securities Legend from Exhibit 1 to Appendix A and replace the
Assignment Form included in this Exhibit A with the Assignment Form included in
such Exhibit 1.
<PAGE>

                                                                               2

                                                                CUSIP __________

No.______________                                                   $ __________

              11 1/4% Senior Subordinated Notes Due June 15, 2011

              Blum CB Corp., a Delaware corporation, promises to pay to        ,
              or registered assigns, the principal sum of Dollars on June 15,
              2011.

              Interest Payment Dates:  June 15 and December 15.

              Record Dates:  June 1 and December 1.

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

Dated:

                                 BLUM CB CORP.

                                   by

                                     Name:
                                     Title:

TRUSTEE'S CERTIFICATE OF
  AUTHENTICATION

STATE STREET BANK AND TRUST
  COMPANY OF CALIFORNIA, N.A.
  as Trustee, certifies that
    this is one of the
    Securities referred to in
    the Indenture.

by

        Authorized Signatory
<PAGE>

                                                                               3

                       [FORM OF REVERSE SIDE OF SECURITY
                         OR PRIVATE EXCHANGE SECURITY]

              11 1/4% Senior Subordinated Note Due June 15, 2011

1.  Interest
    --------

          Blum CB Corp., a Delaware corporation (such corporation, and its
successors and assigns under the Indenture hereinafter referred to, being herein
called the "Company"), promises to pay interest on the principal amount of this
Security at the rate per annum shown above[; provided, however, that if a
                                             --------  -------
Registration Default (as defined in the Registration Rights Agreement) occurs,
additional interest will accrue on this Security at a rate of 0.50% per annum
(increasing by an additional 0.50% per annum after each consecutive 90-day
period that occurs after the date on which such Registration Default occurs up
to a maximum additional interest rate of 2.00%) from and including the date on
which any such Registration Default shall occur to but excluding the date on
which all Registration Defaults have been cured.]1 The Company will pay interest
semiannually on June 15 and December 15 of each year, commencing December 15,
2001. Interest on the Securities will accrue from the most recent date to which
interest has been paid or, if no interest has been paid, from June 7, 2001.
Interest will be computed on the basis of a 360-day year of twelve 30-day
months.

2.  Method of Payment
    -----------------

          The Company will pay interest on the Securities (except defaulted
interest) to the Persons who are registered holders of Securities at the close
of business on the June 1 or December 1 next preceding the interest payment date
even if Securities are canceled after the record date and on or before the
interest payment date. Holders must surrender Securities to a Paying Agent to
collect principal payments. The Company will pay principal and interest in money
of the United States that at the time of payment is legal tender for payment of
public and private debts. Payments in respect of the Securities represented by a
Global Security (including principal, premium and interest) will be made by wire
transfer of immediately available funds to the accounts specified by The
Depository Trust Company. The Company will make all

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

     1. Insert if at the date of issuance of the Exchange Security or Private
     Exchange Security (as the case may be) any Registration Default has
     occurred with respect to the related Initial Securities during the interest
     period in which such date of issuance occurs.
<PAGE>

                                                                               4

payments in respect of a certificated Security (including principal, premium and
interest) by mailing a check to the registered address of each Holder thereof;
provided, however, that payments on a certificated Security will be made by wire
--------  -------
transfer to a U.S. dollar account maintained by the payee with a bank in the
United States if such Holder elects payment by wire transfer by giving written
notice to the Trustee or the Paying Agent to such effect designating such
account no later than 30 days immediately preceding the relevant due date for
payment (or such other date as the Trustee may accept in its discretion).

3.  Paying Agent and Registrar
    --------------------------

          Initially, State Street Bank and Trust Company of California, N.A.
(the "Trustee"), will act as Paying Agent and Registrar. The Company may appoint
and change any Paying Agent, Registrar or co-registrar without notice. The
Company or any of its domestically incorporated Wholly Owned Subsidiaries may
act as Paying Agent, Registrar or co-registrar.

4.  Indenture
    ---------

          The Company issued the Securities under an Indenture dated as of June
7, 2001 ("Indenture"), between the Company, Parent and the Trustee. The terms of
the Securities include those stated in the Indenture and those made part of the
Indenture by reference to the Trust Indenture Act of 1939 (15 U.S.C. (S)(S)
                                                              ------
77aaa-77bbbb) as in effect on the date of the Indenture (the "Act"). Terms
defined in the Indenture and not defined herein have the meanings ascribed
thereto in the Indenture. The Securities are subject to all such terms, and
Securityholders are referred to the Indenture and the Act for a statement of
those terms.

          The Securities are general unsecured obligations of the Company. The
Company shall be entitled, subject to its compliance with Section 4.03 of the
Indenture, to issue Additional Securities pursuant to Section 2.13 of the
Indenture. The Initial Securities issued on the Issue Date, any Additional
Securities and all Exchange Securities or Private Exchange Securities issued in
exchange therefor will be treated as a single class for all purposes under the
Indenture. The Indenture contains covenants that limit the ability of the
Company and its subsidiaries to incur additional indebtedness; pay dividends or
distributions on, or redeem or repurchase capital stock; make investments; issue
or sell capital stock of subsidiaries; engage in transactions with affiliates;
transfer or sell assets; guarantee indebtedness; restrict dividends or other
payments of subsidiaries; and consolidate, merge or transfer all or
substantially all of its
<PAGE>

                                                                               5

assets and the assets of its subsidiaries. These covenants are subject to
important exceptions and qualifications.

5.  Optional Redemption
    -------------------

          Except as set forth below, the Company shall not be entitled to redeem
the Securities at its option prior to June 15, 2006.

          On and after June 15, 2006, the Company shall be entitled at its
option to redeem all or a portion of the Securities upon not less than 30 nor
more than 60 days' notice, at the redemption prices (expressed in percentages of
principal amount, on the redemption date) plus accrued interest to the
redemption date (subject to the right of Holders of record on the relevant
record date to receive interest due on the related interest payment date), if
redeemed during the 12-month period commencing on June 15 of the years set forth
below:

                                                      Redemption
          Period                                        Price
          ------                                      ----------

          2006                                        105.625%
          2007                                        103.750
          2008                                        101.875
          2009 and thereafter                         100.000%

          In addition, prior to June 15, 2004, the Company shall be entitled at
its option on one or more occasions to redeem Securities (which includes
Additional Securities, if any) in an aggregate principal amount not to exceed
35% of the aggregate principal amount of the Securities (which includes
Additional Securities, if any) originally issued at a redemption price
(expressed as a percentage of principal amount) of 111 1/4%, plus accrued and
unpaid interest to the redemption date, with the net cash proceeds from one or
more Public Equity Offerings (provided that if the Public Equity Offering is an
                              --------
offering by Parent, a portion of the Net Cash Proceeds equal to the amount
required to redeem any Securities is contributed to the equity capital of the
Company); provided, however, that (1) at least 65% of such aggregate principal
          --------  -------
amount of Securities (which includes Additional Securities, if any) remains
outstanding immediately after the occurrence of each such redemption (other than
Securities held, directly or indirectly, by the Company or its Affiliates); and
(2) each such redemption occurs within 90 days after the date of the related
Public Equity Offering.
<PAGE>

                                                                               6

6.  Special Mandatory Redemption
    ----------------------------

          In the event the Transactions are not consummated on or prior to the
75th day after the Issue Date or the Merger Agreement is terminated at any time
prior thereto, the Company shall redeem the Securities at a redemption price
equal to 100% of the accreted value thereof on the redemption date (calculated
for the period from the Issue Date to such redemption date based on the straight
line method over the life of the Securities), plus accrued and unpaid interest
to the redemption date (subject to the right of Holders of record on the
relevant record date to receive interest due on the related interest payment
date). The Company shall be entitled to receive a credit against the accreted
value of the Securities required to be redeemed pursuant to this paragraph equal
to the accreted value on such redemption date (excluding premium) of any
Securities that the Company has acquired or redeemed other than pursuant to this
paragraph and has delivered to the Trustee for cancellation. The Company shall
be entitled to receive the credit only once for any Security. The Company shall
cause the notice of the special mandatory redemption to be mailed no later than
the next Business Day following the 75th day after the Issue Date or following
the date the Merger Agreement is terminated, as applicable, and shall redeem the
Securities three Business Days following the date of notice of redemption.

7.  Notice of Redemption
    --------------------

          Except as set forth in paragraph 6 above, notice of redemption will be
mailed at least 30 days but not more than 60 days before the redemption date to
each Holder of Securities to be redeemed at his registered address. Securities
in denominations larger than $1,000 principal amount may be redeemed in part but
only in whole multiples of $1,000. If money sufficient to pay the redemption
price of and accrued interest on all Securities (or portions thereof) to be
redeemed on the redemption date is deposited with the Paying Agent on or before
the redemption date and certain other conditions are satisfied, on and after
such date interest ceases to accrue on such Securities (or such portions
thereof) called for redemption.

8.  Put Provisions
    --------------

          Upon a Change of Control, any Holder of Securities will have the
right, subject to certain conditions, to cause the Company to purchase all or
any part of the Securities of such Holder at a purchase price equal to 101% of
the principal amount thereof on the date of purchase plus accrued and unpaid
interest to the date of repurchase (subject to the right of holders of record on
the relevant record date to receive interest due on the related
<PAGE>

                                                                               7

interest payment date) as provided in, and subject to the terms of, the
Indenture.

9.  Subordination
    -------------

          The Securities are subordinated to Senior Indebtedness of the Company,
as defined in the Indenture. To the extent provided in the Indenture, Senior
Indebtedness of the Company must be paid before the Securities may be paid. The
Company agrees, and each Securityholder by accepting a Security agrees, to the
subordination provisions contained in the Indenture and authorizes the Trustee
to give it effect and appoints the Trustee as attorney-in-fact for such purpose.

10.  Guarantee
     ---------

          The payment by the Company of the principal of, and premium and
interest on, the Securities is fully and unconditionally guaranteed on a joint
and several senior subordinated basis by each of the Guarantors.

11.  Denominations; Transfer; Exchange
     ---------------------------------

          The Securities are in registered form without coupons in denominations
of $1,000 principal amount and whole multiples of $1,000. A Holder may transfer
or exchange Securities in accordance with the Indenture. The Registrar may
require a Holder, among other things, to furnish appropriate endorsements or
transfer documents and to pay any taxes and fees required by law or permitted by
the Indenture. The Registrar need not register the transfer of or exchange any
Securities selected for redemption (except, in the case of a Security to be
redeemed in part, the portion of the Security not to be redeemed) or any
Securities for a period of 15 days before a selection of Securities to be
redeemed or 15 days before an interest payment date.

12.  Persons Deemed Owners
     ---------------------

          The registered Holder of this Security may be treated as the owner of
it for all purposes.

13.  Unclaimed Money
     ---------------

          If money for the payment of principal or interest remains unclaimed
for two years, the Trustee or Paying Agent shall pay the money back to the
Company at its request unless an abandoned
<PAGE>

                                                                               8

property law designates another Person. After any such payment, Holders entitled
to the money must look only to the Company and not to the Trustee for payment.

14.  Discharge and Defeasance
     ------------------------

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

15.  Amendment, Waiver
     -----------------

          Subject to certain exceptions set forth in the Indenture, (i) the
Indenture and the Securities may be amended with the written consent of the
Holders of at least a majority in principal amount outstanding of the Securities
and (ii) any default or noncompliance with any provision may be waived with the
written consent of the Holders of a majority in principal amount outstanding of
the Securities. Subject to certain exceptions set forth in the Indenture,
without the consent of any Securityholder, the Company, the Guarantors and the
Trustee shall be entitled to amend the Indenture or the Securities to cure any
ambiguity, omission, defect or inconsistency, or to comply with Article 5 of the
Indenture, or to provide for uncertificated Securities in addition to or in
place of certificated Securities, or to add guarantees with respect to the
Securities, including Guaranties, or to secure the Securities, or to add
additional covenants or surrender rights and powers conferred on the Company or
the Guarantors, or to comply with any request of the SEC in connection with
qualifying the Indenture under the Act, or to make any change that does not
adversely affect the rights of any Securityholder.

16.  Defaults and Remedies
     ---------------------

          Under the Indenture, Events of Default include (i) default for 30 days
in payment of interest on the Securities; (ii) default in payment of principal
on the Securities at maturity, upon redemption pursuant to paragraph 5 or 6 of
the Securities, upon acceleration or otherwise, or failure by the Company to
redeem or purchase Securities when required; (iii) failure by the Company,
Parent or any Subsidiary Guarantor to comply with other agreements in the
Indenture or the Securities, in certain cases subject to notice and lapse of
time; (iv) certain accelerations (including failure to pay within any grace
period after final maturity) of other Indebtedness of the Company or any
Significant Subsidiary if
<PAGE>

                                                                               9

the amount accelerated (or so unpaid) exceeds $10.0 million; (v) certain events
of bankruptcy or insolvency with respect to the Company and the Significant
Subsidiaries; (vi) certain judgments or decrees for the payment of money in
excess of $10.0 million; and (vii) certain defaults with respect to the
Guaranties. If an Event of Default occurs and is continuing, the Trustee or the
Holders of at least 25% in principal amount of the Securities may declare all
the Securities to be due and payable immediately. Certain events of bankruptcy
or insolvency are Events of Default which will result in the Securities being
due and payable immediately upon the occurrence of such Events of Default.

          Securityholders may not enforce the Indenture or the Securities except
as provided in the Indenture. The Trustee may refuse to enforce the Indenture or
the Securities unless it receives indemnity or security satisfactory to it.
Subject to certain limitations, Holders of a majority in principal amount of the
Securities may direct the Trustee in its exercise of any trust or power. The
Trustee may withhold from Securityholders notice of any continuing Default
(except a Default in payment of principal or interest) if it determines that
withholding notice is in the interest of the Holders.

17.  Trustee Dealings with the Company
     ---------------------------------

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

18.  No Recourse Against Others
     --------------------------

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

19.  Authentication
     --------------

          This Security shall not be valid until an authorized signatory of the
Trustee (or an authenticating agent) manually
<PAGE>

                                                                              10

signs the certificate of authentication on the other side of this Security.

20.  Abbreviations
     -------------

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

21.  CUSIP Numbers
     -------------

          Pursuant to a recommendation promulgated by the Committee on Uniform
Security Identification Procedures the Company has caused CUSIP numbers to be
printed on the Securities and has directed the Trustee to use CUSIP numbers in
notices of redemption as a convenience to Securityholders. No representation is
made as to the accuracy of such numbers either as printed on the Securities or
as contained in any notice of redemption and reliance may be placed only on the
other identification numbers placed thereon.

22.  Holders' Compliance with Registration Rights Agreement
     ------------------------------------------------------

          Each Holder of a Security, by acceptance hereof, acknowledges and
agrees to the provisions of the Registration Rights Agreement, including the
obligations of the Holders with respect to a registration and the
indemnification of the Company to the extent provided therein.

23.  Governing Law
     -------------

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

          The Company will furnish to any Securityholder upon written request
and without charge to the Securityholder a copy of the Indenture which has in it
the text of this Security in larger type. Requests may be made to:

          BLUM CB Corp.
          909 Montgomery Street
          Suite 400
          San Francisco, California 94133

          Attention: Alan Willis
<PAGE>

                                                                              11

_____________________________________________________________

                                ASSIGNMENT FORM

To assign this Security, fill in the form below:

I or we assign and transfer this Security to

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

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

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

____________________________________________________________

Date: ________________ Your Signature: _____________________

____________________________________________________________
Sign exactly as your name appears on the other side of this
Security.
<PAGE>

                      OPTION OF HOLDER TO ELECT PURCHASE

          If you want to elect to have this Security purchased by the Company
pursuant to Section 4.06 or 4.09 of the Indenture, check the box:

                                      [_]

          If you want to elect to have only part of this Security purchased by
the Company pursuant to Section 4.06 or of the Indenture, state the amount in
principal amount: $

Date: _______________           Your Signature:  ____________________________
                                                 (Sign exactly as your name
                                                 appears on the other side of
                                                 this Security.)
Signature Guarantee: ____________________________________________________
                                (Signature must be guaranteed)

     Signatures must be guaranteed by an "eligible guarantor institution"
meeting the requirements of the Registrar, which requirements include membership
or participation in the Security Transfer Agent Medallion Program ("STAMP") or
such other "signature guarantee program" as may be determined by the Registrar
in addition to, or in substitution for, STAMP, all in accordance with the
Securities Exchange Act of 1934, as amended.<PAGE>

                                                                    EXHIBIT 4.11

                                                                  Execution Copy

                                 $229,000,000

                                 BLUM CB CORP.

                  11 1/4% Senior Subordinated Notes Due 2011

                         REGISTRATION RIGHTS AGREEMENT
                         -----------------------------

                                                                    May 31, 2001

Credit Suisse First Boston Corporation
Credit Lyonnais Securities (USA) Inc.
HSBC Securities (USA) Inc.
Scotia Capital (USA) Inc.
c/o Credit Suisse First Boston Corporation
     Eleven Madison Avenue
         New York, New York 10010-3629

Dear Sirs:

         BLUM CB Corp., a Delaware corporation (the "Issuer"), proposes to issue
and sell to Credit Suisse First Boston Corporation ("CSFBC"), HSBC Securities
(USA) Inc., Credit Lyonnais Securities (USA) Inc. and Scotia Capital (USA) Inc.
(the "Initial Purchasers"), upon the terms set forth in a purchase agreement of
even date herewith (the "Purchase Agreement"), $229,000,000 aggregate principal
amount of its 11 1/4% Senior Subordinated Notes Due 2011 to be guaranteed by the
CBRE Holding, Inc. (the "Parent Guarantor") on the issue date (the "Notes"). The
Notes will be issued pursuant to an Indenture, dated as of June 7, 2001 (the
"Indenture"), among the Issuer, the Parent Guarantor and State Street Bank and
Trust Company of California, N.A., as trustee (the "Trustee"). As part of the
Transactions (as defined in the Purchase Agreement), the Issuer will merge with
and into CB Richard Ellis Services, Inc., with CB Richard Ellis Services, Inc.
as the surviving corporation in such merger (the "Merger"). If the Merger and
the other Transactions are consummated on or before the 75th day after the
closing of the offering of the Notes, CB Richard Ellis Services, Inc. and its
subsidiaries that are guarantors ("Subsidiary Guarantors") under the Credit
Agreement to be entered into concurrently with the consummation of the Merger
will (1) execute counterparts to this Agreement and the Purchase Agreement,
which will cause the obligations of the Issuer under this Agreement and the
Purchase Agreement which survive past the closing date of the Merger to be
contractually assumed by CB Richard Ellis Services, Inc. and the Subsidiary
Guarantors and (2) enter into a supplemental indenture relating to the
Indenture, which will cause the obligations of the Issuer to be assumed by CB
Richard Ellis Services, Inc. and to be guaranteed on an unconditional senior
subordinated basis by the Subsidiary Guarantors (the "Subsidiary Guaranties").
If the Merger and the other Transactions are not consummated on or before the
75th day after the closing of the offering of the Notes or the Merger Agreement
(as defined in the Purchase Agreement) is terminated at any time prior thereto,
the Issuer will redeem the Notes at a redemption price equal to 100% of the
accreted value of the Notes plus accrued and unpaid interest to the date of
redemption. As used herein, the "Company" refers to the Issuer and the Parent
Guarantor before the Merger and to CB Richard Ellis Services, Inc., the Parent
Guarantor and the Subsidiary Guarantors after the Merger. The "Initial
Securities" refers to the Notes (which term includes the notes and the guaranty
by the Parent Guarantor) before the Merger and the Notes, the Parent Guaranty
and the Subsidiary Guaranties after the Merger.
<PAGE>

         As an inducement to the Initial Purchasers to enter into the Purchase
Agreement, the Company agrees with the Initial Purchasers, for the benefit of
the holders of the Initial Securities (including, without limitation, the
Initial Purchasers), the Exchange Securities (as defined below) and the Private
Exchange Securities (as defined below) (collectively, the "Holders"), as
follows:

         1. Registered Exchange Offer. Unless not permitted by applicable law
(after the Company has complied with the ultimate paragraph of this Section 1),
the Company shall prepare and, not later than 90 days (such 90th day being a
"Filing Deadline") after the date on which the Merger is consummated (the
"Merger Date"), file with the Securities and Exchange Commission (the
"Commission") a registration statement (the "Exchange Offer Registration
Statement") on an appropriate form under the Securities Act of 1933, as amended
(the "Securities Act"), with respect to a proposed offer (the "Registered
Exchange Offer") to the Holders of Transfer Restricted Securities (as defined in
Section 6 hereof), who are not prohibited by any law or policy of the Commission
from participating in the Registered Exchange Offer, to issue and deliver to
such Holders, in exchange for the Initial Securities, a like aggregate principal
amount of debt securities of the Company issued under the Indenture, identical
in all material respects to the Initial Securities and registered under the
Securities Act (the "Exchange Securities"). The Company shall use its reasonable
best efforts to (i) cause such Exchange Offer Registration Statement to become
effective under the Securities Act within 180 days after the Merger Date (such
180th day being an "Effectiveness Deadline") and (ii) keep the Exchange Offer
Registration Statement effective for not less than 20 business days (or longer,
if required by applicable law) after the date notice of the Registered Exchange
Offer is mailed to the Holders (such period being called the "Exchange Offer
Registration Period").

         If the Company commences the Registered Exchange Offer, the Company (i)
will be entitled to consummate the Registered Exchange Offer 20 business days
after such commencement (provided that the Company has accepted all the Initial
Securities theretofore validly tendered in accordance with the terms of the
Registered Exchange Offer) and (ii) will be required to consummate the
Registered Exchange Offer no later than 40 days after the date on which the
Exchange Offer Registration Statement is declared effective (such 40th day being
the "Consummation Deadline").

         Following the declaration of the effectiveness of the Exchange Offer
Registration Statement, the Company shall promptly commence the Registered
Exchange Offer, it being the objective of such Registered Exchange Offer to
enable each Holder of Transfer Restricted Securities electing to exchange the
Initial Securities for Exchange Securities (assuming that such Holder is not an
affiliate of the Company within the meaning of the Securities Act, acquires the
Exchange Securities in the ordinary course of such Holder's business and has no
arrangements with any person to participate in the distribution of the Exchange
Securities and is not prohibited by any law or policy of the Commission from
participating in the Registered Exchange Offer) to trade such Exchange
Securities from and after their receipt without any limitations or restrictions
under the Securities Act and without material restrictions under the securities
laws of the several states of the United States.

         The Company acknowledges that, pursuant to current interpretations by
the Commission's staff of Section 5 of the Securities Act, in the absence of an
applicable exemption therefrom, (i) each Holder which is a broker-dealer
electing to exchange Initial Securities, acquired for its own account as a
result of market making activities or other trading activities, for Exchange
Securities (an "Exchanging Dealer"), is required to deliver a prospectus
containing the information set forth in (a) Annex A hereto on the cover, (b)
Annex B hereto in the "Exchange Offer Procedures" section and the "Purpose of
the Exchange Offer" section, and (c) Annex C hereto in the "Plan of
Distribution" section of such prospectus in connection with a sale of any such
Exchange Securities received by such Exchanging Dealer pursuant to the
Registered Exchange Offer and (ii) an Initial Purchaser that elects to sell
Securities (as defined below) acquired in exchange for Initial Securities
constituting any portion of an unsold allotment, is required to deliver a
prospectus containing the information required by Items 507 or 508 of Regulation
S-K under the Securities Act, as applicable, in connection with such sale.

         The Company shall use its reasonable best efforts to keep the Exchange
Offer Registration Statement effective and to amend and supplement the
prospectus contained therein, in order to permit such prospectus to be lawfully
delivered by all persons subject to the prospectus delivery requirements of the
Securities Act for such period of time as such persons must comply with such
requirements in order to resell the Exchange Securities; provided, however, that
                                                         --------  ------
(i) in the case where such prospectus and any amendment or supplement thereto
must be delivered by an Exchanging Dealer or an Initial Purchasers, such period
shall be the lesser of 180 days and the date on which all Exchanging Dealers and
the Initial Purchasers have sold all

                                       2
<PAGE>

Exchange Securities held by them (unless such period is extended pursuant to
Section 3(j) below) and (ii) the Company shall make such prospectus and any
amendment or supplement thereto available to any broker-dealer for use in
connection with any resale of any Exchange Securities for a period of not less
than 180 days after the consummation of the Registered Exchange Offer.
Notwithstanding the foregoing, the Company shall not be obligated to keep the
Exchange Offer Registration Statement continuously effective to the extent set
forth above if the Company determines, in its reasonable judgment, upon advice
of counsel, that the continued effectiveness and usability of the Exchange Offer
Registration Statement would (i) require the disclosure of material information,
which the Company or any of its subsidiaries has a bona fide business reason for
preserving as confidential or (ii) interfere with any existing or prospective
financing, acquisition, corporate reorganization or other material business
situation, transaction or negotiation involving the Company or any of its
subsidiaries; provided, however, that the failure to keep the Exchange Offer
              --------  -------
Registration Statement effective and usable for such reason shall last no longer
than 20 days (whereafter Additional Interest (as defined in Section 6(a)) shall
accrue and be payable until the Exchange Offer Registration Statement becomes
effective and usable) and shall in no event occur during the first 30 days after
the Exchange Offer Registration Statement becomes effective. In the event that
the Company does not keep the Exchange Offer Registration Statement continuously
effective as provided in the immediately preceding sentence, the number of days
during which the Exchange Offer Registration Statement is not continuously
effective, which shall include the date the Company gives notice that the
Exchange Offer Registration Statement is no longer effective, shall be added on
to, and therefore extend, the period during which the Company is obligated to
use its reasonable best efforts to keep the Exchange Offer Registration
Statement effective and to amend and supplement the prospectus contained
therein.

         If, upon consummation of the Registered Exchange Offer, any Initial
Purchaser holds Initial Securities acquired by it as part of its initial
distribution, the Company, simultaneously with the delivery of the Exchange
Securities pursuant to the Registered Exchange Offer, shall issue and deliver to
such Initial Purchaser upon the written request of such Initial Purchaser, in
exchange (the "Private Exchange") for the Initial Securities held by such
Initial Purchaser, a like principal amount of debt securities of the Company
issued under the Indenture and identical in all material respects to the Initial
Securities (the "Private Exchange Securities"). The Initial Securities, the
Exchange Securities and the Private Exchange Securities are herein collectively
called the "Securities".

         In connection with the Registered Exchange Offer, the Company shall:

                  (a) mail to each Holder a copy of the prospectus forming part
         of the Exchange Offer Registration Statement, together with an
         appropriate letter of transmittal and related documents;

                  (b) keep the Registered Exchange Offer open for not less than
         20 business days (or longer, if required by applicable law) after the
         date notice thereof is mailed to the Holders;

                  (c) utilize the services of a depositary for the Registered
         Exchange Offer with an address in the Borough of Manhattan, The City of
         New York, which may be the Trustee or an affiliate of the Trustee;

                  (d) permit Holders to withdraw tendered Securities at any time
         prior to the close of business, New York time, on the last business day
         on which the Registered Exchange Offer shall remain open; and

                  (e) otherwise comply with all applicable laws.

         As soon as practicable after the close of the Registered Exchange Offer
or the Private Exchange, as the case may be, the Company shall:

                  (x) accept for exchange all the Securities validly tendered
         and not withdrawn pursuant to the Registered Exchange Offer and the
         Private Exchange;

                  (y) deliver to the Trustee for cancellation all the Initial
         Securities so accepted for exchange; and

                                       3
<PAGE>

                  (z) cause the Trustee to authenticate and deliver promptly to
         each Holder of the Initial Securities, Exchange Securities or Private
         Exchange Securities, as the case may be, equal in principal amount to
         the Initial Securities of such Holder so accepted for exchange.

         The Indenture will provide that the Exchange Securities will not be
subject to the transfer restrictions set forth in the Indenture and that all the
Securities will vote and consent together on all matters as one class and that
none of the Securities will have the right to vote or consent as a class
separate from one another on any matter.

         Interest on each Exchange Security and Private Exchange Security issued
pursuant to the Registered Exchange Offer and in the Private Exchange will
accrue from the last interest payment date on which interest was paid on the
Initial Securities surrendered in exchange therefor or, if no interest has been
paid on the Initial Securities, from the date of original issue of the Initial
Securities.

         Each Holder participating in the Registered Exchange Offer shall be
required to represent to the Company that at the time of the consummation of the
Registered Exchange Offer (i) any Exchange Securities received by such Holder
will be acquired in the ordinary course of business, (ii) such Holder will have
no arrangements or understanding with any person to participate in the
distribution of the Securities or the Exchange Securities within the meaning of
the Securities Act, (iii) such Holder is not an "affiliate," as defined in Rule
405 of the Securities Act, of the Company or if it is an affiliate, such Holder
will comply with the registration and prospectus delivery requirements of the
Securities Act to the extent applicable, (iv) if such Holder is not a
broker-dealer, that it is not engaged in, and does not intend to engage in, the
distribution of the Exchange Securities and (v) if such Holder is a
broker-dealer, that it will receive Exchange Securities for its own account in
exchange for Initial Securities that were acquired as a result of market-making
activities or other trading activities and that it will be required to
acknowledge that it will deliver a prospectus in connection with any resale of
such Exchange Securities.

         Notwithstanding any other provisions hereof, the Company will ensure
that (i) any Exchange Offer Registration Statement and any amendment thereto and
any prospectus forming part thereof and any supplement thereto complies in all
material respects with the Securities Act and the rules and regulations
thereunder, (ii) any Exchange Offer Registration Statement and any amendment
thereto does not, when it becomes effective, contain an untrue statement of a
material fact or omit to state a material fact required to be stated therein or
necessary to make the statements therein not misleading and (iii) any prospectus
forming part of any Exchange Offer Registration Statement, and any supplement to
such prospectus, does not include an untrue statement of a material fact or omit
to state a material fact required to be stated therein or necessary in order to
make the statements therein, in the light of the circumstances under which they
were made, not misleading.

         2. Shelf Registration. If, (i) applicable interpretations of the staff
of the Commission do not permit the Company to effect a Registered Exchange
Offer, as contemplated by Section 1 hereof, (ii) the Registered Exchange Offer
is not consummated by the 220th day after the Merger Date, (iii) any Initial
Purchaser so requests with respect to the Initial Securities (or the Private
Exchange Securities) not eligible to be exchanged for Exchange Securities in the
Registered Exchange Offer and held by it following consummation of the
Registered Exchange Offer or (iv) any Holder (other than an Exchanging Dealer)
is prohibited by law or Commission policy from participating in the Registered
Exchange Offer or, in the case of any Holder (other than an Exchanging Dealer)
that participates in the Registered Exchange Offer, such Holder does not receive
freely tradeable Exchange Securities on the date of the exchange and any such
Holder so requests, the Company shall take the following actions (the date on
which any of the conditions described in the foregoing clauses (i) through (iv)
occur, including in the case of clauses (iii) or (iv) the receipt of the
required notice, being a "Trigger Date"):

                  (a) The Company shall as promptly as practicable (but in no
         event more than 90 days after the Trigger Date (such 90th day being a
         "Filing Deadline")) file with the Commission and thereafter use its
         reasonable best efforts to cause to be declared effective: in the case
         of clause (i), no later than 180 days after the Merger Date and, in the
         case of clauses (ii) through (iv), no later than 90th date after the
         Trigger Date (such 180th day after the Merger Date in the case of
         clause (i), or such 90th day after the Trigger Date in the case of
         clauses (ii) through (iv) being an "Effectiveness Deadline") a
         registration statement (the "Shelf Registration Statement" and,
         together with the Exchange Offer Registration Statement, a
         "Registration Statement") on an appropriate form under the Securities
         Act relating to the offer and sale of the Transfer Restricted

                                       4
<PAGE>

         Securities by the Holders thereof from time to time in accordance with
         the methods of distribution set forth in the Shelf Registration
         Statement and Rule 415 under the Securities Act (hereinafter, the
         "Shelf Registration"); provided, however, that no Holder (other than an
                                --------  -------
         Initial Purchaser) shall be entitled to have the Securities held by it
         covered by such Shelf Registration Statement unless such Holder agrees
         in writing to be bound by all the provisions of this Agreement
         applicable to such Holder.

                  (b) The Company shall use its reasonable best efforts to keep
         the Shelf Registration Statement continuously effective in order to
         permit the prospectus included therein to be lawfully delivered by the
         Holders of the relevant Securities, for a period of two years (or for
         such longer period if extended pursuant to Section 3(j) below) from the
         date of its effectiveness or such shorter period that will terminate
         when all the Securities covered by the Shelf Registration Statement (i)
         have been sold pursuant thereto or (ii) are no longer restricted
         securities (as defined in Rule 144 under the Securities Act, or any
         successor rule thereof) provided, however, the Company shall not be
                                 --------  -------
         obligated to keep the Shelf Registration Statement continuously
         effective to the extent set forth below if (i) the Company determines,
         in its reasonable judgment, upon advice of counsel, that the continued
         effectiveness and usability of the Shelf Registration statement would
         (x) require the disclosure of material information, which the Company
         or any of its subsidiaries has a bona fide business reason for
         preserving as confidential or (y) interfere with any financing,
         acquisition, corporate reorganization or other material transaction
         involving the Company or any of its subsidiaries, provided that the
                                                           --------
         failure to keep the Shelf Registration Statement effective and usable
         for offers and sales of Securities for the reasons set forth in clauses
         (x) and (y) above shall last no longer than 60 days in any 12- month
         period (whereafter Additional Interest (as defined in Section 6(a))
         shall accrue and be payable until the Shelf Registration Statement
         becomes effective and usable) and (ii) the Company promptly thereafter
         complies with the requirements of Section 3(j) hereof, if applicable;
         provided, further, that the number of days of any actual Suspension
         --------  -------
         Period (as hereinafter defined) shall be added on to, and therefore
         extend, the two-year period specified above. Any such period during
         which the Company is excused from keeping the Shelf Registration
         Statement effective and usable for offers and sales of securities is
         referred to herein as a "Suspension Period." A Suspension Period shall
         commence on and include the date that the Company gives notice that the
         Shelf Registration Statement is no longer effective or the prospectus
         included therein is no longer usable for offers and sales of Securities
         and shall end on the earlier to occur of (1) the date on which each
         seller of Securities covered by the Shelf Registration Statement either
         receives the copies of the supplemented or amended prospectus
         contemplated by Section 3(j) hereof or is advised in writing by the
         Company that the use of the prospectus may be resumed and (2) the
         expiration of 60 days in any 12-month period during which one or more
         Suspension Periods has been in effect. The Company shall be deemed not
         to have used its reasonable best efforts to keep the Shelf Registration
         Statement effective during the requisite period if it voluntarily takes
         any action that would result in Holders of Securities covered thereby
         not being able to offer and sell such Securities during that period,
         unless such action is (A) required by applicable law or (B) permitted
         by this paragraph.

                  (c) Notwithstanding any other provisions of this Agreement to
         the contrary, the Company shall cause the Shelf Registration Statement
         and the related prospectus and any amendment or supplement thereto, as
         of the effective date of the Shelf Registration Statement, amendment or
         supplement, (i) to comply in all material respects with the applicable
         requirements of the Securities Act and the rules and regulations of the
         Commission and (ii) not to contain any untrue statement of a material
         fact or omit to state a material fact required to be stated therein or
         necessary in order to make the statements therein, in light of the
         circumstances under which they were made, not misleading.

         3.  Registration Procedures. In connection with any Shelf Registration
contemplated by Section 2 hereof and, to the extent applicable, any Registered
Exchange Offer contemplated by Section 1 hereof, the following provisions shall
apply:

                  (a) The Company shall (i) furnish to each Initial Purchaser,
         prior to the filing thereof with the Commission, a copy of the
         Registration Statement and each amendment thereof and each supplement,
         if any, to the prospectus included therein and, in the event that an
         Initial Purchaser (with respect to any portion of an unsold allotment
         from the original offering) is participating in the Registered Exchange
         Offer or the Shelf Registration Statement, the Company shall use its

                                       5
<PAGE>

         reasonable best efforts to reflect in each such document, when so filed
         with the Commission, such comments as such Initial Purchaser reasonably
         may propose; (ii) include the information set forth in Annex A hereto
         on the cover, in Annex B hereto in the "Exchange Offer Procedures"
         section and the "Purpose of the Exchange Offer" section and in Annex C
         hereto in the "Plan of Distribution" section of the prospectus forming
         a part of the Exchange Offer Registration Statement and include the
         information set forth in Annex D hereto in the Letter of Transmittal
         delivered pursuant to the Registered Exchange Offer; (iii) if requested
         by an Initial Purchaser, include the information required by Items 507
         or 508 of Regulation S-K under the Securities Act, as applicable, in
         the prospectus forming a part of the Exchange Offer Registration
         Statement; (iv) include within the prospectus contained in the Exchange
         Offer Registration Statement a section entitled "Plan of Distribution,"
         reasonably acceptable to the Initial Purchasers, which shall contain a
         summary statement of the positions taken or policies made by the staff
         of the Commission with respect to the potential "underwriter" status of
         any broker-dealer that is the beneficial owner (as defined in Rule 13d-
         3 under the Securities Exchange Act of 1934, as amended (the "Exchange
         Act")) of Exchange Securities received by such broker-dealer in the
         Registered Exchange Offer (a "Participating Broker-Dealer"), whether
         such positions or policies have been publicly disseminated by the staff
         of the Commission or such positions or policies, in the reasonable
         judgment of the Initial Purchasers based upon advice of counsel (which
         may be in-house counsel), represent the prevailing views of the staff
         of the Commission; and (v) in the case of a Shelf Registration
         Statement, include the names of the Holders who propose to sell
         Securities pursuant to the Shelf Registration Statement as selling
         securityholders.

                  (b) The Company shall give written notice to the Initial
         Purchasers, the Holders of the Securities and any Participating
         Broker-Dealer from whom the Company has received prior written notice
         that it will be a Participating Broker-Dealer in the Registered
         Exchange Offer (which notice pursuant to clauses (ii)-(v) hereof shall
         be accompanied by an instruction to suspend the use of the prospectus
         until the requisite changes have been made):

                           (i)   when the Registration Statement or any
                  amendment thereto has been filed with the Commission and when
                  the Registration Statement or any post-effective amendment
                  thereto has become effective;

                           (ii)  of any request by the Commission for amendments
                  or supplements to the Registration Statement or the prospectus
                  included therein or for additional information;

                           (iii) of the issuance by the Commission of any stop
                  order suspending the effectiveness of the Registration
                  Statement or the initiation of any proceedings for that
                  purpose;

                           (iv)  of the receipt by the Company or its legal
                  counsel of any notification with respect to the suspension of
                  the qualification of the Securities for sale in any
                  jurisdiction or the initiation or threatening of any
                  proceeding for such purpose; and

                           (v)   of the happening of any event that requires the
                  Company to make changes in the Registration Statement or the
                  prospectus in order that the Registration Statement or the
                  prospectus do not contain an untrue statement of a material
                  fact nor omit to state a material fact required to be stated
                  therein or necessary to make the statements therein (in the
                  case of the prospectus, in light of the circumstances under
                  which they were made) not misleading.

                  (c) The Company shall make every reasonable effort to obtain
         the withdrawal at the earliest possible time, of any order suspending
         the effectiveness of the Registration Statement.

                  (d) The Company shall furnish to each Holder of Securities
         included within the coverage of the Shelf Registration, without charge,
         at least one copy of the Shelf Registration Statement and any
         post-effective amendment thereto, including financial statements and
         schedules, and, if the Holder so requests in writing, all exhibits
         thereto (including those, if any, incorporated by reference).

                                       6
<PAGE>

                  (e) The Company shall deliver to each Exchanging Dealer and
         each Initial Purchaser, and to any other Holder who so requests,
         without charge, at least one copy of the Exchange Offer Registration
         Statement and any post-effective amendment thereto, including financial
         statements and schedules, and, if any Initial Purchaser or any such
         Holder requests, all exhibits thereto (including those incorporated by
         reference).

                  (f) The Company shall, during the Shelf Registration Period,
         deliver to each Holder of Securities included within the coverage of
         the Shelf Registration, without charge, as many copies of the
         prospectus (including each preliminary prospectus) included in the
         Shelf Registration Statement and any amendment or supplement thereto as
         such person may reasonably request. The Company consents, subject to
         the provisions of this Agreement, to the use of the prospectus or any
         amendment or supplement thereto by each of the selling Holders of the
         Securities in connection with the offering and sale of the Securities
         covered by the prospectus, or any amendment or supplement thereto,
         included in the Shelf Registration Statement.

                  (g) The Company shall deliver to each Initial Purchaser, any
         Exchanging Dealer, any Participating Broker-Dealer and such other
         persons required to deliver a prospectus following the Registered
         Exchange Offer, without charge, as many copies of the final prospectus
         included in the Exchange Offer Registration Statement and any amendment
         or supplement thereto as such persons may reasonably request. The
         Company consents, subject to the provisions of this Agreement, to the
         use of the prospectus or any amendment or supplement thereto by any
         Initial Purchaser, if necessary, any Participating Broker-Dealer and
         such other persons required to deliver a prospectus following the
         Registered Exchange Offer in connection with the offering and sale of
         the Exchange Securities covered by the prospectus, or any amendment or
         supplement thereto, included in such Exchange Offer Registration
         Statement.

                  (h) Prior to any public offering of the Securities pursuant to
         any Registration Statement the Company shall use its reasonable best
         efforts to register or qualify or cooperate with the Holders of the
         Securities included therein and their respective counsel in connection
         with the registration or qualification of the Securities for offer and
         sale under the securities or "blue sky" laws of such states of the
         United States as any Holder of the Securities reasonably requests in
         writing and do any and all other acts or things necessary or advisable
         to enable the offer and sale in such jurisdictions of the Securities
         covered by such Registration Statement; provided, however, that the
         Company shall not be required to (i) qualify generally to do business
         in any jurisdiction where it is not then so qualified or (ii) take any
         action which would subject it to general service of process or to
         taxation in any jurisdiction where it is not then so subject.

                  (i) The Company shall cooperate with the Holders of the
         Securities to facilitate the timely preparation and delivery of
         certificates representing the Securities to be sold pursuant to any
         Registration Statement free of any restrictive legends and in such
         denominations and registered in such names as the Holders may request a
         reasonable period of time prior to sales of the Securities pursuant to
         such Registration Statement.

                  (j) Upon the occurrence of any event contemplated by
         paragraphs (ii) through (v) of Section 3(b) above during the period for
         which the Company is required to maintain an effective Registration
         Statement, the Company shall promptly prepare and file a post-effective
         amendment to the Registration Statement or a supplement to the related
         prospectus and any other required document so that, as thereafter
         delivered to Holders of the Securities or purchasers of Securities, the
         prospectus will not contain an untrue statement of a material fact or
         omit to state any material fact required to be stated therein or
         necessary to make the statements therein, in light of the circumstances
         under which they were made, not misleading. If the Company notifies the
         Initial Purchasers, the Holders of the Securities and any known
         Participating Broker-Dealer in accordance with paragraphs (ii) through
         (v) of Section 3(b) above to suspend the use of the prospectus until
         the requisite changes to the prospectus have been made, then the
         Initial Purchasers, the Holders of the Securities and any such
         Participating Broker-Dealers shall suspend use of such prospectus, and
         the period of effectiveness of the Shelf Registration Statement
         provided for in Section 2(b) above and the Exchange Offer Registration
         Statement provided for in Section 1 above shall each be extended by the
         number of days from and including the date of the giving of such notice
         to and including the date when the Initial Purchasers, the Holders of
         the Securities and any known Participating

                                       7
<PAGE>

         Broker-Dealer shall have received such amended or supplemented
         prospectus pursuant to this Section 3(j).

                  (k) Not later than the effective date of the applicable
         Registration Statement, the Company will provide a CUSIP number for the
         Initial Securities, the Exchange Securities or the Private Exchange
         Securities, as the case may be, and provide the applicable trustee with
         printed certificates for the Initial Securities, the Exchange
         Securities or the Private Exchange Securities, as the case may be, in a
         form eligible for deposit with The Depository Trust Company.

                  (l) The Company will comply with all rules and regulations of
         the Commission to the extent and so long as they are applicable to the
         Registered Exchange Offer or the Shelf Registration and will make
         generally available to its security holders (or otherwise provide in
         accordance with Section 11(a) of the Securities Act) an earnings
         statement satisfying the provisions of Section 11(a) of the Securities
         Act, no later than 45 days after the end of a 12-month period (or 90
         days, if such period is a fiscal year) beginning with the first month
         of the Company's first fiscal quarter commencing after the effective
         date of the Registration Statement, which statement shall cover such
         12-month period.

                  (m) The Company shall cause the Indenture to be qualified
         under the Trust Indenture Act of 1939, as amended, in a timely manner
         and containing such changes, if any, as shall be necessary for such
         qualification. In the event that such qualification would require the
         appointment of a new trustee under the Indenture, the Company shall
         appoint a new trustee thereunder pursuant to the applicable provisions
         of the Indenture.

                  (n) The Company may require each Holder of Securities to be
         sold pursuant to the Shelf Registration Statement to furnish to the
         Company such information regarding the Holder and the distribution of
         the Securities as the Company may from time to time reasonably require
         for inclusion in the Shelf Registration Statement, and the Company may
         exclude from such registration the Securities of any Holder that
         unreasonably fails to furnish such information within a reasonable time
         after receiving such request.

                  (o) The Company shall enter into such customary agreements
         (including, if requested by the Holders of at least 10% of the
         aggregate principal amount of the outstanding Securities covered
         thereby, an underwriting agreement in customary form) and take all such
         other action, if any, as the Holders of at least 10% of the aggregate
         principal amount of the outstanding Securities shall reasonably request
         in order to facilitate the disposition of the Securities pursuant to
         any Shelf Registration.

                  (p) In the case of any Shelf Registration, the Company shall
         (i) make reasonably available for inspection by the Holders of the
         Securities, any underwriter participating in any disposition pursuant
         to the Shelf Registration Statement and any attorney, accountant or
         other agent retained by the Holders of the Securities or any such
         underwriter all relevant financial and other records, pertinent
         corporate documents and properties of the Company and (ii) cause the
         Company's officers, directors, employees, accountants and auditors to
         supply all relevant information reasonably requested by the Holders of
         the Securities or any such underwriter, attorney, accountant or agent
         in connection with the Shelf Registration Statement (the information
         supplied pursuant to clauses (i) and (ii) being the "Records"), in each
         case, as shall be reasonably necessary to enable such persons, to
         conduct a reasonable investigation within the meaning of Section 11 of
         the Securities Act; provided, however, that any such person shall first
                             --------  -------
         agree in writing with the Company that any information that is
         reasonably and in good faith designated by the Company as confidential
         at the time of delivery of such information shall be kept confidential
         by such person, unless (A) disclosure of such information is required
         by court or administrative order or is necessary to respond to
         inquiries of regulatory authorities, (B) disclosure of such information
         is required by law (including any disclosure requirements pursuant to
         federal securities laws in connection with the filing of the
         Registration Statement or the use of any prospectus) or (C) such
         information becomes generally available to the public other than as a
         result of a disclosure or failure to safeguard such information by such
         person; provided further that the foregoing inspection and information
                 --------  -------
         gathering shall be coordinated on behalf of the Initial Purchasers by
         CSFBC and on behalf of the other parties, by one counsel designated by
         and on behalf of such other parties as described in Section 4 hereof.
         Each Holder of Securities and the Initial Purchasers further agree

                                       8
<PAGE>

         and shall cause any person reviewing documents on their behalf pursuant
         to this paragraph (p) to agree, that it will, upon learning that
         disclosure of such Records is sought pursuant to clause (A) or (B)
         above, give notice to the Company and allow the Company, at its
         expense, to undertake appropriate action to prevent disclosure of the
         Records deemed confidential.

                  (q) In the case of any Shelf Registration, the Company, if
         requested by any Holder of at least 10% of the aggregate principal
         amount of the outstanding Securities covered thereby, shall cause (i)
         its counsel to deliver an opinion and updates thereof relating to the
         Securities in customary form addressed to such Holders and the managing
         underwriters, if any, thereof and dated, in the case of the initial
         opinion, the effective date of such Shelf Registration Statement (it
         being agreed that the matters to be covered by such opinion shall
         include, without limitation, the due incorporation and good standing of
         the Company and the Subsidiary Guarantors); the qualification of the
         Company and the Subsidiary Guarantors to transact business as foreign
         corporations; the due authorization, execution and delivery of the
         relevant agreement of the type referred to in Section 3(o) hereof; the
         due authorization, execution, authentication and issuance, and the
         validity and enforceability, of the applicable Securities; the absence
         of material legal or governmental proceedings involving the Company and
         the Subsidiary Guarantors; the absence of governmental approvals
         required to be obtained in connection with the Shelf Registration
         Statement, the offering and sale of the applicable Securities, or any
         agreement of the type referred to in Section 3(o) hereof; the
         compliance as to form of such Shelf Registration Statement and any
         documents incorporated by reference therein and of the Indenture with
         the requirements of the Securities Act and the Trust Indenture Act,
         respectively; and, as of the date of the opinion and as of the
         effective date of the Shelf Registration Statement or most recent
         post-effective amendment thereto (or in the case of a Shelf
         Registration Statement where a new Annual Report on Form 10-K has been
         filed by the Company subsequent to the effective date of the Shelf
         Registration Statement or latest post-effective amendment thereto, as
         of the date of such Annual Report), as the case may be, the absence
         from such Shelf Registration Statement and the prospectus included
         therein, as then amended or supplemented, and from any documents
         incorporated by reference therein of an untrue statement of a material
         fact or the omission to state therein a material fact required to be
         stated therein or necessary to make the statements therein not
         misleading (in the case of any such documents, in the light of the
         circumstances existing at the time that such documents were filed with
         the Commission under the Exchange Act); (ii) its officers to execute
         and deliver all customary documents and certificates and updates
         thereof requested by any underwriters of the applicable Securities and
         (iii) its independent public accountants to provide to the selling
         Holders of the applicable Securities and any underwriter therefor a
         comfort letter in customary form and covering matters of the type
         customarily covered in comfort letters in connection with primary
         underwritten offerings, subject to receipt of appropriate documentation
         as contemplated, and only if permitted, by Statement of Auditing
         Standards No. 72.

                  (r) In the case of the Registered Exchange Offer, if requested
         by any Initial Purchaser or any known Participating Broker-Dealer, the
         Company shall cause (i) its counsel to deliver to such Initial
         Purchaser or such Participating Broker-Dealer a signed opinion
         substantially in the form set forth in Exhibits A and C to the Purchase
         Agreement, modified as is customary in connection with the preparation
         of a Registration Statement and (ii) its independent public accountants
         to deliver to such Initial Purchaser or such Participating
         Broker-Dealer a comfort letter, in customary form, meeting the
         requirements as to the substance thereof as set forth in Section 6(a)
         of the Purchase Agreement, with appropriate date changes.

                  (s) If a Registered Exchange Offer or a Private Exchange is to
         be consummated, upon delivery of the Initial Securities by Holders to
         the Company (or to such other Person as directed by the Company) in
         exchange for the Exchange Securities or the Private Exchange
         Securities, as the case may be, the Company shall mark, or caused to be
         marked, on the Initial Securities so exchanged that such Initial
         Securities are being canceled in exchange for the Exchange Securities
         or the Private Exchange Securities, as the case may be; in no event
         shall the Initial Securities be marked as paid or otherwise satisfied.

                  (t) If the Initial Securities have been rated prior to the
         initial sale of such Initial Securities, the Company will use its
         reasonable best efforts to confirm such ratings will apply to the
         Securities covered by a Registration Statement.

                                       9
<PAGE>

                  (u) In the event that any broker-dealer registered under the
         Exchange Act shall underwrite any Securities or participate as a member
         of an underwriting syndicate or selling group or "assist in the
         distribution" (within the meaning of the Conduct Rules (the "Rules") of
         the National Association of Securities Dealers, Inc. ("NASD")) thereof,
         whether as a Holder of such Securities or as an underwriter, a
         placement or sales agent or a broker or dealer in respect thereof, or
         otherwise, the Company will assist such broker-dealer in complying with
         the requirements of such Rules, including, without limitation, by (i)
         if such Rules, including Rule 2720, shall so require, engaging a
         "qualified independent underwriter" (as defined in Rule 2720) to
         participate in the preparation of the Registration Statement relating
         to such Securities, to exercise usual standards of due diligence in
         respect thereto and, if any portion of the offering contemplated by
         such Registration Statement is an underwritten offering or is made
         through a placement or sales agent, to recommend the yield of such
         Securities, (ii) indemnifying any such qualified independent
         underwriter to the extent of the indemnification of underwriters
         provided in Section 5 hereof and (iii) providing such information to
         such broker-dealer as may be required in order for such broker-dealer
         to comply with the requirements of the Rules.

                  (v) The Company shall use its reasonable best efforts to take
         all other steps necessary to effect the registration of the Securities
         covered by a Registration Statement contemplated hereby.

         4.  Registration Expenses. (a) All expenses incident to the Company's
performance of and compliance with this Agreement will be borne by the Company,
regardless of whether a Registration Statement is ever filed or becomes
effective, including without limitation;

                  (i)   all registration and filing fees and expenses;

                  (ii)  all fees and expenses of compliance with federal
         securities and state "blue sky" or securities laws;

                  (iii) all expenses of printing (including printing
         certificates for the Securities to be issued in the Registered Exchange
         Offer and the Private Exchange and printing of Prospectuses), messenger
         and delivery services and telephone;

                  (iv)  all fees and disbursements of counsel for the Company;

                  (v)   all application and filing fees in connection with
         listing the Exchange Securities on a national securities exchange or
         automated quotation system pursuant to the requirements hereof; and

                  (vi)  all fees and disbursements of independent certified
         public accountants of the Company (including the expenses of any
         special audit and comfort letters required by or incident to such
         performance).

The Company will bear its internal expenses (including, without limitation, all
salaries and expenses of its officers and employees performing legal or
accounting duties), the expenses of any annual audit and the fees and expenses
of any person, including special experts, retained by the Company.

         (b) In connection with any Registration Statement required by this
Agreement, the Company will reimburse the Initial Purchasers and the Holders of
Transfer Restricted Securities who are tendering Initial Securities in the
Registered Exchange Offer and/or selling or reselling Securities pursuant to the
"Plan of Distribution" contained in the Exchange Offer Registration Statement or
the Shelf Registration Statement, as applicable, for the reasonable fees and
disbursements (such fees and disbursements not to exceed $10,000) of not more
than one counsel, who shall be Cravath, Swaine & Moore unless another firm shall
be chosen by the Holders of a majority in principal amount of the Transfer
Restricted Securities for whose benefit such Registration Statement is being
prepared.

         5. Indemnification. (a) The Company agrees to indemnify and hold
harmless each Holder of the Securities, any Participating Broker-Dealer and each
person, if any, who controls such Holder or such Participating Broker-Dealer
within the meaning of the Securities Act or the Exchange Act (each Holder, any
Participating Broker-Dealer and such controlling persons are referred to
collectively as the "Indemnified Parties") from and against any losses, claims,
damages or liabilities, joint or several, or any actions in

                                       10
<PAGE>

respect thereof (including, but not limited to, any losses, claims, damages,
liabilities or actions relating to purchases and sales of the Securities) to
which each Indemnified Party may become subject under the Securities Act, the
Exchange Act or otherwise, insofar as such losses, claims, damages, liabilities
or actions arise out of or are based upon any untrue statement or alleged untrue
statement of a material fact contained in a Registration Statement or prospectus
or in any amendment or supplement thereto or in any preliminary prospectus
relating to a Shelf Registration, or arise out of, or are based upon, the
omission or alleged omission to state therein a material fact required to be
stated therein or necessary to make the statements therein not misleading, and
shall reimburse, as incurred, the Indemnified Parties for any legal or other
expenses reasonably incurred by them in connection with investigating or
defending any such loss, claim, damage, liability or action in respect thereof;
provided, however, that (i) the Company shall not be liable in any such case to
--------  -------
the extent that such loss, claim, damage or liability arises out of or is based
upon any untrue statement or alleged untrue statement or omission or alleged
omission (A) made in a Registration Statement or prospectus or in any amendment
or supplement thereto or in any preliminary prospectus relating to a Shelf
Registration in reliance upon and in conformity with written information
pertaining to such Holder and furnished to the Company by or on behalf of such
Holder specifically for inclusion therein or (B) resulting from the use of the
prospectus during the period when the use of the prospectus was suspended or
otherwise unavailable for sales thereunder in accordance with the terms of this
Agreement; provided, however, that Holders received at least 10 days prior
           --------  -------
written notice of such suspension or other unavailability; and (ii) with respect
to any untrue statement or omission or alleged untrue statement or omission made
in any preliminary prospectus relating to a Shelf Registration Statement, the
indemnity agreement contained in this subsection (a) shall not inure to the
benefit of any Holder or Participating Broker-Dealer from whom the person
asserting any such losses, claims, damages or liabilities purchased the
Securities concerned, to the extent that a prospectus relating to such
Securities was required to be delivered by such Holder or Participating Broker-
Dealer under the Securities Act in connection with such purchase and any such
loss, claim, damage or liability of such Holder or Participating Broker-Dealer
results from the fact that there was not sent or given to such person, at or
prior to the written confirmation of the sale of such Securities to such person,
a copy of the final prospectus if the Company had previously furnished copies
thereof to such Holder or Participating Broker-Dealer; provided further,
                                                       -------- --------
however, that this indemnity agreement will be in addition to any liability
-------
which the Company may otherwise have to such Indemnified Party. The Company
shall also indemnify underwriters, their officers and directors and each person
who controls such underwriters within the meaning of the Securities Act or the
Exchange Act to the same extent as provided above with respect to the
indemnification of the Holders of the Securities if requested by such Holders.

         (b) Each Holder of the Securities, severally and not jointly, will
indemnify and hold harmless the Company and each person, if any, who controls
the Company within the meaning of the Securities Act or the Exchange Act from
and against any losses, claims, damages or liabilities or any actions in respect
thereof, to which the Company or any such controlling person may become subject
under the Securities Act, the Exchange Act or otherwise, insofar as such losses,
claims, damages, liabilities or actions arise out of or are based upon any
untrue statement or alleged untrue statement of a material fact contained in a
Registration Statement or prospectus or in any amendment or supplement thereto
or in any preliminary prospectus relating to a Shelf Registration, or arise out
of or are based upon the omission or alleged omission to state therein a
material fact necessary to make the statements therein not misleading, but in
each case only to the extent that the untrue statement or omission or alleged
untrue statement or omission was made in reliance upon and in conformity with
written information pertaining to such Holder and furnished to the Company by or
on behalf of such Holder specifically for inclusion therein; and, subject to the
limitation set forth immediately preceding this clause, shall reimburse, as
incurred, the Company for any legal or other expenses reasonably incurred by the
Company or any such controlling person in connection with investigating or
defending any loss, claim, damage, liability or action in respect thereof. This
indemnity agreement will be in addition to any liability which such Holder may
otherwise have to the Company or any of its controlling persons.

         (c) Promptly after receipt by an indemnified party under this Section 5
of notice of the commencement of any action or proceeding (including a
governmental investigation), such indemnified party will, if a claim in respect
thereof is to be made against the indemnifying party under this Section 5,
notify the indemnifying party of the commencement thereof; but the omission so
to notify the indemnifying party will not, in any event, relieve the
indemnifying party from any obligations to any indemnified party other than the
indemnification obligation provided in paragraph (a) or (b) above. In case any
such action is brought against any indemnified party, and it notifies the
indemnifying party of the commencement thereof, the indemnifying party will be
entitled to participate therein and, to the extent that it may wish, jointly
with any other indemnifying party similarly notified, to assume the defense
thereof, with counsel reasonably satisfactory to

                                       11
<PAGE>

such indemnified party (who shall not, except with the consent of the
indemnified party, be counsel to the indemnifying party), and after notice from
the indemnifying party to such indemnified party of its election so to assume
the defense thereof the indemnifying party will not be liable to such
indemnified party under this Section 5 for any legal or other expenses, other
than reasonable costs of investigation, subsequently incurred by such
indemnified party in connection with the defense thereof. No indemnifying party
shall, without the prior written consent of the indemnified party, effect any
settlement of any pending or threatened action in respect of which any
indemnified party is or could have been a party and indemnity could have been
sought hereunder by such indemnified party unless such settlement includes an
unconditional release of such indemnified party from all liability on any claims
that are the subject matter of such action, and does not include a statement as
to or an admission of fault, culpability or a failure to act by or on behalf of
any indemnified party.

         (d) If the indemnification provided for in this Section 5 is
unavailable or insufficient to hold harmless an indemnified party under
subsections (a) or (b) above, then each indemnifying party shall contribute to
the amount paid or payable by such indemnified party as a result of the losses,
claims, damages or liabilities (or actions in respect thereof) referred to in
subsection (a) or (b) above (i) in such proportion as is appropriate to reflect
the relative benefits received by the indemnifying party or parties on the one
hand and the indemnified party on the other from the exchange of the Securities,
pursuant to the Registered Exchange Offer, or (ii) if the allocation provided by
the foregoing clause (i) is not permitted by applicable law, in such proportion
as is appropriate to reflect not only the relative benefits referred to in
clause (i) above but also the relative fault of the indemnifying party or
parties on the one hand and the indemnified party on the other in connection
with the statements or omissions that resulted in such losses, claims, damages
or liabilities (or actions in respect thereof) as well as any other relevant
equitable considerations. The relative fault of the parties shall be determined
by reference to, among other things, whether the untrue or alleged untrue
statement of a material fact or the omission or alleged omission to state a
material fact relates to information supplied by the Company on the one hand or
such Holder or such other indemnified party, as the case may be, on the other,
and the parties' relative intent, knowledge, access to information and
opportunity to correct or prevent such statement or omission. The amount paid by
an indemnified party as a result of the losses, claims, damages or liabilities
referred to in the first sentence of this subsection (d) shall be deemed to
include any legal or other expenses reasonably incurred by such indemnified
party in connection with investigating or defending any action or claim which is
the subject of this subsection (d). Notwithstanding any other provision of this
Section 5(d), the Holders of the Securities shall not be required to contribute
any amount in excess of the amount by which the net proceeds received by such
Holders from the sale of the Securities pursuant to a Registration Statement
exceeds the amount of damages which such Holders have otherwise been required to
pay by reason of such untrue or alleged untrue statement or omission or alleged
omission. No person guilty of fraudulent misrepresentation (within the meaning
of Section 11(f) of the Securities Act) shall be entitled to contribution from
any person who was not guilty of such fraudulent misrepresentation. For purposes
of this paragraph (d), each person, if any, who controls such indemnified party
within the meaning of the Securities Act or the Exchange Act shall have the same
rights to contribution as such indemnified party and each person, if any, who
controls the Company within the meaning of the Securities Act or the Exchange
Act shall have the same rights to contribution as the Company.

         (e) The agreements contained in this Section 5 shall survive the sale
of the Securities pursuant to a Registration Statement and shall remain in full
force and effect, regardless of any termination or cancellation of this
Agreement or any investigation made by or on behalf of any indemnified party.

         6.  Additional Interest Under Certain Circumstances. (a) Additional
interest (the "Additional Interest") with respect to the Securities shall be
assessed as follows if any of the following events occur (each such event in
clauses (i) through (iv) below being herein called a "Registration Default"):

         (i)   any Registration Statement required by this Agreement is not
               filed with the Commission on or prior to the applicable Filing
               Deadline;

         (ii)  any Registration Statement required by this Agreement is not
               declared effective by the Commission on or prior to the
               applicable Effectiveness Deadline;

         (iii) the Registered Exchange Offer has not been consummated on or
               prior to the Consummation Deadline; or

                                       12
<PAGE>

         (iv)  any Registration Statement required by this Agreement has been
               declared effective by the Commission but (A) such Registration
               Statement thereafter ceases to be effective or (B) such
               Registration Statement or the related prospectus ceases to be
               usable in connection with resales of Transfer Restricted
               Securities during the periods specified herein because either (1)
               any event occurs as a result of which the related prospectus
               forming part of such Registration Statement would include any
               untrue statement of a material fact or omit to state any material
               fact necessary to make the statements therein in the light of the
               circumstances under which they were made not misleading, or (2)
               it shall be necessary to amend such Registration Statement or
               supplement the related prospectus, to comply with the Securities
               Act or the Exchange Act or the respective rules thereunder.

Each of the foregoing will constitute a Registration Default whatever the reason
for any such event and whether it is voluntary or involuntary or is beyond the
control of the Company or pursuant to operation of law or as a result of any
action or inaction by the Commission.

         Additional Interest shall accrue on the Securities over and above the
interest set forth in the title of the Securities from and including the date on
which any such Registration Default shall occur to but excluding the date on
which all such Registration Defaults have been cured, at a rate of 0.50% per
annum (the "Additional Interest Rate") for the first 90-day period immediately
following the occurrence of such Registration Default. The Additional Interest
Rate shall increase by an additional 0.50% per annum with respect to each
subsequent 90-day period until all Registration Defaults have been cured, up to
a maximum Additional Interest Rate of 2.0% per annum.

         (b) A Registration Default referred to in Section 6(a)(iv) hereof shall
be deemed not to have occurred and be continuing in relation to a Shelf
Registration Statement or the related prospectus if (i) such Registration
Default has occurred solely as a result of (x) the filing of a post-effective
amendment to such Shelf Registration Statement to incorporate annual audited
financial information with respect to the Company where such post-effective
amendment is not yet effective and needs to be declared effective to permit
Holders to use the related prospectus or (y) other material events, with respect
to the Company that would need to be described in such Shelf Registration
Statement or the related prospectus and (ii) in the case of clause (y), the
Company is proceeding promptly and in good faith to amend or supplement such
Shelf Registration Statement and related prospectus to describe such events;
provided, however, that in any case if such Registration Default occurs for a
--------  -------
continuous period in excess of 30 days, Additional Interest shall be payable in
accordance with the above paragraph from the day such Registration Default
occurs until such Registration Default is cured.

         (c) Any amounts of Additional Interest due pursuant to Section 6(a)
will be payable in cash on the regular interest payment dates with respect to
the Securities. The amount of Additional Interest will be determined by
multiplying the applicable Additional Interest Rate by the principal amount of
the Securities and further multiplied by a fraction, the numerator of which is
the number of days such Additional Interest Rate was applicable during such
period (determined on the basis of a 360-day year comprised of twelve 30-day
months), and the denominator of which is 360.

         (d) "Transfer Restricted Securities" means each Security until (i) the
date on which such Security has been exchanged by a person other than a
broker-dealer for a freely transferable Exchange Security in the Registered
Exchange Offer, (ii) following the exchange by a broker-dealer in the Registered
Exchange Offer of an Initial Security for an Exchange Note, the date on which
such Exchange Note is sold to a purchaser who receives from such broker-dealer
on or prior to the date of such sale a copy of the prospectus contained in the
Exchange Offer Registration Statement, (iii) the date on which such Security has
been effectively registered under the Securities Act and disposed of in
accordance with the Shelf Registration Statement or (iv) the date on which such
Security is distributed to the public pursuant to Rule 144 under the Securities
Act or is saleable pursuant to Rule 144(k) under the Securities Act.

         7. Rules 144 and 144A. The Company shall use its best efforts to file
the reports required to be filed by it under the Securities Act and the Exchange
Act in a timely manner and, if at any time the Company is not required to file
such reports, it will, upon the request of any Holder of Securities, make
publicly available other information so long as necessary to permit sales of
their Securities pursuant to Rules 144 and 144A. The Company covenants that it
will take such further action as any Holder of Securities may reasonably
request, all to the extent required from time to time to enable such Holder to
sell Securities without registration under the Securities Act within the
limitation of the exemptions provided by Rules 144

                                       13
<PAGE>

and 144A (including the requirements of Rule 144A(d)(4)). The Company will
provide a copy of this Agreement to prospective purchasers of Initial Securities
identified to the Company by the Initial Purchasers upon request. Upon the
request of any Holder of Initial Securities, the Company shall deliver to such
Holder a written statement as to whether it has complied with such requirements.
Notwithstanding the foregoing, nothing in this Section 7 shall be deemed to
require the Company to register any of its Securities pursuant to the Exchange
Act.

         8. Underwritten Registrations. If any of the Transfer Restricted
Securities covered by any Shelf Registration are to be sold in an underwritten
offering, the investment banker or investment bankers and manager or managers
that will administer the offering ("Managing Underwriters") will be selected by
the Holders of a majority in aggregate principal amount of such Transfer
Restricted Securities to be included in such offering and shall be reasonably
acceptable to the Company.

         No person may participate in any underwritten registration hereunder
unless such person (i) agrees to sell such person's Transfer Restricted
Securities on the basis reasonably provided in any underwriting arrangements
approved by the persons entitled hereunder to approve such arrangements and (ii)
completes and executes all questionnaires, powers of attorney, indemnities,
underwriting agreements and other documents reasonably required under the terms
of such underwriting arrangements.

         9.  Miscellaneous.

         (a) Remedies. The Company acknowledges and agrees that any failure by
the Company to comply with its obligations under Section 1 and 2 hereof may
result in material irreparable injury to the Initial Purchasers or the Holders
for which there is no adequate remedy at law, that it will not be possible to
measure damages for such injuries precisely and that, in the event of any such
failure, the Initial Purchasers or any Holder may obtain such relief as may be
required to specifically enforce the Company's obligations under Sections 1 and
2 hereof. The Company further agrees to waive the defense in any action for
specific performance that a remedy at law would be adequate.

         (b) No Inconsistent Agreements. The Company will not on or after the
date of this Agreement enter into any agreement with respect to its securities
that is inconsistent with the rights granted to the Holders in this Agreement or
otherwise conflicts with the provisions hereof. The rights granted to the
Holders hereunder do not in any way conflict with and are not inconsistent with
the rights granted to the holders of the Company's securities under any
agreement in effect on the date hereof.

         (c) Amendments and Waivers. The provisions of this Agreement may not be
amended, modified or supplemented, and waivers or consents to departures from
the provisions hereof may not be given, except by the Company and the written
consent of the Holders of a majority in principal amount of the Securities
affected by such amendment, modification, supplement, waiver or consents.

         (d) Notices. All notices and other communications provided for or
permitted hereunder shall be made in writing by hand delivery, first-class mail,
facsimile transmission, or air courier which guarantees overnight delivery:

                  (1)  if to a Holder of the Securities, at the most current
address given by such Holder to the Company.

                  (2)  if to the Initial Purchasers;

                           Credit Suisse First Boston Corporation
                           Eleven Madison Avenue
                           New York, NY 10010-3629
                           Fax No.: (212) 325-8278
                           Attention: Transactions Advisory Group

                                       14
<PAGE>

         with a copy to:

                           Cravath, Swaine & Moore
                           Worldwide Plaza
                           825 Eighth Avenue
                           New York, NY 10019
                           Fax No.: (212) 474-3700
                           Attention:  Stephen L. Burns, Esq.

                  (3)      if to the Company, at its address as follows:

                           CB Richard Ellis Services, Inc.
                           505 Montgomery Street, Suite 600
                           San Francisco, California 94111
                           Fax No.: (415) 733-5555
                           Attention:  Walt Stafford, Esq.

         with a copy to:

                           Simpson Thacher & Bartlett
                           3330 Hillview Avenue
                           Palo Alto, CA 94304
                           Fax No.: (650) 251-5002
                           Attention:  Richard Capelouto, Esq.

         All such notices and communications shall be deemed to have been duly
given: at the time delivered by hand, if personally delivered; three business
days after being deposited in the mail, postage prepaid, if mailed; when receipt
is acknowledged by recipient's facsimile machine operator, if sent by facsimile
transmission; and on the day delivered, if sent by overnight air courier
guaranteeing next day delivery.

         (e) Third Party Beneficiaries. The Holders shall be third party
beneficiaries to the agreements made hereunder between the Company, on the one
hand, and the Initial Purchasers, on the other hand, and shall have the right to
enforce such agreements directly to the extent they may deem such enforcement
necessary or advisable to protect their rights or the rights of Holders
hereunder.

         (f)  Successors and Assigns. This Agreement shall be binding upon the
Company, the Initial Purchasers and their successors and assigns.

         (g) Counterparts. This Agreement may be executed in any number of
counterparts and by the parties hereto in separate counterparts, each of which
when so executed shall be deemed to be an original and all of which taken
together shall constitute one and the same agreement.

         (h) Headings. The headings in this Agreement are for convenience of
reference only and shall not limit or otherwise affect the meaning hereof.

         (i)  Governing Law.  THIS AGREEMENT SHALL BE GOVERNED BY, AND CONSTRUED
IN ACCORDANCE WITH, THE LAWS OF THE STATE OF NEW YORK.

         (j) Severability. If any one or more of the provisions contained
herein, or the application thereof in any circumstance, is held invalid, illegal
or unenforceable, the validity, legality and enforceability of any such
provision in every other respect and of the remaining provisions contained
herein shall not be affected or impaired thereby.

                                       15
<PAGE>

         (k) Securities Held by the Company. Whenever the consent or approval of
Holders of a specified percentage of principal amount of Securities is required
hereunder, Securities held by the Company or its affiliates (other than
subsequent Holders of Securities if such subsequent Holders are deemed to be
affiliates solely by reason of their holdings of such Securities) shall not be
counted in determining whether such consent or approval was given by the Holders
of such required percentage.

                                       16
<PAGE>

         If the foregoing is in accordance with your understanding of our
agreement, please sign and return to the Company a counterpart hereof, whereupon
this instrument, along with all counterparts, will become a binding agreement
among the several Initial Purchasers, the Issuer and the Parent Guarantor in
accordance with its terms.

                                        Very truly yours,

                                        BLUM CB CORP.

                                        by   /s/ Claus J. Moller
                                             ----------------------------
                                             Name:   Claus J. Moller
                                             Title:  President

                                        CBRE HOLDING, INC.

                                        by   /s/ Claus J. Moller
                                             ----------------------------
                                             Name:   Claus J. Moller
                                             Title:  President

The foregoing Registration
Rights Agreement is hereby
confirmed and accepted as
of the date first above written.

CREDIT SUISSE FIRST BOSTON CORPORATION
CREDIT LYONNAIS SECURITIES (USA) INC.
HSBC SECURITIES (USA) INC.
SCOTIA CAPITAL (USA) INC.

BY:  CREDIT SUISSE FIRST BOSTON CORPORATION
     on behalf of the Initial Purchasers

by   /s/ Malcolm Price
     -------------------------------
     Name:   Malcolm Price
     Title:  Managing Director

                                       17
<PAGE>

                                                                         ANNEX A

         Each broker-dealer that receives Exchange Securities for its own
account pursuant to the Exchange Offer must acknowledge that it will deliver a
prospectus in connection with any resale of such Exchange Securities. The Letter
of Transmittal states that by so acknowledging and by delivering a prospectus, a
broker-dealer will not be deemed to admit that it is an "underwriter" within the
meaning of the Securities Act. This Prospectus, as it may be amended or
supplemented from time to time, may be used by a broker-dealer in connection
with resales of Exchange Securities received in exchange for Initial Securities
where such Initial Securities were acquired by such broker-dealer as a result of
market-making activities or other trading activities. The Company has agreed
that, for a period of 180 days after the Expiration Date (as defined herein), it
will make this Prospectus available to any broker-dealer for use in connection
with any such resale. See "Plan of Distribution."

                                       18
<PAGE>

                                                                         ANNEX B

         Each broker-dealer that receives Exchange Securities for its own
account in exchange for Initial Securities, where such Initial Securities were
acquired by such broker-dealer as a result of market-making activities or other
trading activities, must acknowledge that it will deliver a prospectus in
connection with any resale of such Exchange Securities. See "Plan of
Distribution."

                                       19
<PAGE>

                                                                         ANNEX C

                             PLAN OF DISTRIBUTION

         Each broker-dealer that receives Exchange Securities for its own
account pursuant to the Exchange Offer must acknowledge that it will deliver a
prospectus in connection with any resale of such Exchange Securities. This
Prospectus, as it may be amended or supplemented from time to time, may be used
by a broker-dealer in connection with resales of Exchange Securities received in
exchange for Initial Securities where such Initial Securities were acquired as a
result of market-making activities or other trading activities. The Company has
agreed that, for a period of 180 days after the Expiration Date, it will make
this prospectus, as amended or supplemented, available to any broker-dealer for
use in connection with any such resale. In addition, until             , [   ],
all dealers effecting transactions in the Exchange Securities may be required to
deliver a prospectus./(1)/

         The Company will not receive any proceeds from any sale of Exchange
Securities by broker-dealers. Exchange Securities received by broker-dealers for
their own account pursuant to the Exchange Offer may be sold from time to time
in one or more transactions in the over-the-counter market, in negotiated
transactions, through the writing of options on the Exchange Securities or a
combination of such methods of resale, at market prices prevailing at the time
of resale, at prices related to such prevailing market prices or negotiated
prices. Any such resale may be made directly to purchasers or to or through
brokers or dealers who may receive compensation in the form of commissions or
concessions from any such broker-dealer or the purchasers of any such Exchange
Securities. Any broker-dealer that resells Exchange Securities that were
received by it for its own account pursuant to the Exchange Offer and any broker
or dealer that participates in a distribution of such Exchange Securities may be
deemed to be an "underwriter" within the meaning of the Securities Act and any
profit on any such resale of Exchange Securities and any commission or
concessions received by any such persons may be deemed to be underwriting
compensation under the Securities Act. The Letter of Transmittal states that, by
acknowledging that it will deliver and by delivering a prospectus, a
broker-dealer will not be deemed to admit that it is an "underwriter" within the
meaning of the Securities Act.

         For a period of 180 days after the Expiration Date the Company will
promptly send additional copies of this Prospectus and any amendment or
supplement to this Prospectus to any broker-dealer that requests such documents
in the Letter of Transmittal. The Company has agreed to pay all expenses
incident to the Exchange Offer (including the expenses of one counsel for the
Holders of the Securities) other than commissions or concessions of any brokers
or dealers and will indemnify the Holders of the Securities (including any
broker-dealers) against certain liabilities, including liabilities under the
Securities Act.

___________________
 /(1)/  In addition, the legend required by Item 502(e) of Regulation S-K will
appear on the back cover page of the Exchange Offer prospectus.

                                       20
<PAGE>

                                                                         ANNEX D

ADDITIONAL COPIES OF THE PROSPECTUS AND 10 COPIES OF ANY AMENDMENTS OR
SUPPLEMENTS THERETO.

     Name:_________________________________________
     Address:______________________________________

[ ]  CHECK HERE IF YOU ARE A BROKER-DEALER AND WISH TO RECEIVE 10

If the undersigned is not a broker-dealer, the undersigned represents that it is
not engaged in, and does not intend to engage in, a distribution of Exchange
Securities. If the undersigned is a broker-dealer that will receive Exchange
Securities for its own account in exchange for Initial Securities that were
acquired as a result of market-making activities or other trading activities, it
acknowledges that it will deliver a prospectus in connection with any resale of
such Exchange Securities; however, by so acknowledging and by delivering a
prospectus, the undersigned will not be deemed to admit that it is an
"underwriter" within the meaning of the Securities Act.

                                       21

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