Document:

Exhibit 4.1

 

COMPRESSION
POLYMERS HOLDING CORPORATION,

 

as Issuer

 

THE GUARANTORS
PARTY HERETO FROM TIME TO TIME,

 

as Guarantors

 

Senior
Floating Rate Notes due 2012

 

101⁄2% Senior
Notes due 2013

 

 

INDENTURE

 

Dated as of
July 5, 2005

 

 

Wells Fargo
Bank, N.A.,

as Trustee

 

 

CROSS-REFERENCE
TABLE*

 

	
  Trust Indenture

  Act Section

  	
   

  	
  Indenture

  Section

  
	
  310

  	
  (a)(1)

  	
   

  	
  7.10

  
	
   

  	
  (a)(2)

  	
   

  	
  7.10

  
	
   

  	
  (a)(3)

  	
   

  	
  N.A.

  
	
   

  	
  (a)(4)

  	
   

  	
  N.A.

  
	
   

  	
  (a)(5)

  	
   

  	
  7.10

  
	
   

  	
  (b)

  	
   

  	
  7.3,
  7.8, 7.10

  
	
   

  	
  (c)

  	
   

  	
  N.A.

  
	
  311

  	
  (a)

  	
   

  	
  7.11

  
	
   

  	
  (b)

  	
   

  	
  7.11

  
	
   

  	
  (c)

  	
   

  	
  N.A.

  
	
  312

  	
  (a)

  	
   

  	
  2.5

  
	
   

  	
  (b)

  	
   

  	
  13.3

  
	
   

  	
  (c)

  	
   

  	
  13.3

  
	
  313

  	
  (a)

  	
   

  	
  7.6

  
	
   

  	
  (b)(1)

  	
   

  	
  N.A.

  
	
   

  	
  (b)(2)

  	
   

  	
  7.6

  
	
   

  	
  (c)

  	
   

  	
  7.6,
  13.2

  
	
   

  	
  (d)

  	
   

  	
  7.6

  
	
  314

  	
  (a)

  	
   

  	
  4.3,
  4.4, 13.5

  
	
   

  	
  (b)

  	
   

  	
  N.A.

  
	
   

  	
  (c)(1)

  	
   

  	
  13.4

  
	
   

  	
  (c)(2)

  	
   

  	
  13.4

  
	
   

  	
  (d)

  	
   

  	
  N.A.

  
	
   

  	
  (e)

  	
   

  	
  13.5

  
	
   

  	
  (f)

  	
   

  	
  N.A.

  
	
  315

  	
  (a)

  	
   

  	
  7.1

  
	
   

  	
  (b)

  	
   

  	
  7.5,
  13.2

  
	
   

  	
  (c)

  	
   

  	
  7.1

  
	
   

  	
  (d)

  	
   

  	
  7.1

  
	
   

  	
  (e)

  	
   

  	
  6.12

  
	
  316

  	
  (a)(last
  sentence)

  	
   

  	
  2.9

  
	
   

  	
  (a)(1)(A)

  	
   

  	
  6.5

  
	
   

  	
  (a)(1)(B)

  	
   

  	
  6.4

  
	
   

  	
  (a)(2)

  	
   

  	
  N.A.

  
	
   

  	
  (b)

  	
   

  	
  6.7

  
	
   

  	
  (c)

  	
   

  	
  N.A.

  
	
  317

  	
  (a)(1)

  	
   

  	
  6.8

  
	
   

  	
  (a)(2)

  	
   

  	
  6.10

  
	
   

  	
  (b)

  	
   

  	
  2.4

  
	
  318

  	
  (a)

  	
   

  	
  13.1

  
	
   

  	
  (b)

  	
   

  	
  N.A.

  
	
   

  	
  (c)

  	
   

  	
  13.1

  

 

N.A. means not
applicable.

 

*                                         This
Cross-Reference Table shall not, for any purpose, be deemed a part of the Indenture.

 

 

TABLE OF CONTENTS

 

	
   

  	
   

  	
  Page

  
	
   

  	
   

  
	
  ARTICLE I.

  	
   

  
	
   

  	
   

  	
   

  
	
  DEFINITIONS AND INCORPORATION BY REFERENCE

  	
   

  
	
   

  	
   

  
	
  Section 1.1.

  	
  Definitions

  	
  1

  
	
  Section 1.2.

  	
  Other Definitions

  	
  32

  
	
  Section 1.3.

  	
  Incorporation by
  Reference of Trust Indenture Act

  	
  32

  
	
  Section 1.4.

  	
  Rules of
  Construction

  	
  33

  
	
  Section 1.5.

  	
  Acts of Holders

  	
  33

  
	
   

  	
   

  	
   

  
	
  ARTICLE II.

  	
   

  
	
   

  	
   

  	
   

  
	
  THE NOTES

  	
   

  
	
   

  	
   

  
	
  Section 2.1.

  	
  Form and Dating

  	
  34

  
	
  Section 2.2.

  	
  Execution and
  Authentication

  	
  35

  
	
  Section 2.3.

  	
  Registrar and
  Paying Agent

  	
  36

  
	
  Section 2.4.

  	
  Paying Agents to
  Hold Money in Trust

  	
  37

  
	
  Section 2.5.

  	
  Holder Lists

  	
  37

  
	
  Section 2.6.

  	
  Transfer and
  Exchange

  	
  37

  
	
  Section 2.7.

  	
  Replacement Notes

  	
  45

  
	
  Section 2.8.

  	
  Outstanding Notes

  	
  46

  
	
  Section 2.9.

  	
  Treasury Notes

  	
  46

  
	
  Section 2.10.

  	
  Temporary Notes

  	
  46

  
	
  Section 2.11.

  	
  Cancellation

  	
  47

  
	
  Section 2.12.

  	
  Defaulted Interest

  	
  47

  
	
  Section 2.13.

  	
  Persons Deemed
  Owners

  	
  47

  
	
  Section 2.14.

  	
  CUSIP Numbers, etc.

  	
  47

  
	
  Section 2.15.

  	
  Issuance of
  Additional Notes

  	
  48

  
	
   

  	
   

  	
   

  
	
  ARTICLE III.

  	
   

  
	
   

  	
   

  	
   

  
	
  REDEMPTION AND REPURCHASE

  	
   

  
	
   

  	
   

  
	
  Section 3.1.

  	
  Notices to Trustee

  	
  48

  
	
  Section 3.2.

  	
  Selection of Notes

  	
  49

  
	
  Section 3.3.

  	
  Notice of Optional
  Redemption

  	
  49

  
	
  Section 3.4.

  	
  Effect of Notice of
  Redemption

  	
  50

  
	
  Section 3.5.

  	
  Deposit of
  Redemption Price or Purchase Price

  	
  51

  
	
  Section 3.6.

  	
  Notes Redeemed or
  Repurchased in Part

  	
  51

  
	
  Section 3.7.

  	
  Optional Redemption

  	
  51

  
	
  Section 3.8.

  	
  Optional Redemption
  upon Public Equity Offerings

  	
  51

  
	
  Section 3.9.

  	
  Repurchase upon
  Change of Control Offer

  	
  52

  

 

i

 

	
   

  	
   

  	
  Page

  
	
   

  	
   

  	
   

  
	
  Section 3.10.

  	
  Repurchase upon
  Application of Excess Proceeds

  	
  54

  
	
   

  	
   

  	
   

  
	
  ARTICLE IV.

  	
   

  
	
   

  	
   

  	
   

  
	
  COVENANTS

  	
   

  
	
   

  	
   

  
	
  Section 4.1.

  	
  Payment of
  Principal and Interest

  	
  56

  
	
  Section 4.2.

  	
  Maintenance of
  Office or Agency

  	
  56

  
	
  Section 4.3.

  	
  Reports to Holders

  	
  57

  
	
  Section 4.4.

  	
  Compliance Certificate

  	
  58

  
	
  Section 4.5.

  	
  Taxes

  	
  58

  
	
  Section 4.6.

  	
  Stay, Extension and
  Usury Laws

  	
  59

  
	
  Section 4.7.

  	
  Limitation on
  Restricted Payments

  	
  59

  
	
  Section 4.8.

  	
  Limitation on
  Dividend and Other Payment Restrictions Affecting Subsidiaries

  	
  65

  
	
  Section 4.9.

  	
  Limitation on
  Incurrence of Additional Indebtedness

  	
  67

  
	
  Section 4.10.

  	
  Limitation on Asset
  Sales

  	
  67

  
	
  Section 4.11.

  	
  Limitations on
  Transactions with Affiliates

  	
  70

  
	
  Section 4.12.

  	
  Limitation on Liens

  	
  72

  
	
  Section 4.13.

  	
  Continued Existence

  	
  73

  
	
  Section 4.14.

  	
  [Reserved]

  	
  73

  
	
  Section 4.15.

  	
  Offer to Repurchase
  upon Change of Control

  	
  73

  
	
  Section 4.16.

  	
  Future Subsidiary
  Guarantees

  	
  73

  
	
  Section 4.17.

  	
  [Reserved]

  	
  74

  
	
  Section 4.18.

  	
  Limitation on
  Designations of Unrestricted Subsidiaries

  	
  74

  
	
   

  	
   

  	
   

  
	
  ARTICLE V.

  	
   

  
	
   

  	
   

  	
   

  
	
  SUCCESSORS

  	
   

  
	
   

  	
   

  
	
  Section 5.1.

  	
  Merger,
  Consolidation and Sale of Assets

  	
  75

  
	
   

  	
   

  	
   

  
	
  ARTICLE VI.

  	
   

  
	
   

  	
   

  	
   

  
	
  DEFAULTS AND REMEDIES

  	
   

  
	
   

  	
   

  
	
  Section 6.1.

  	
  Events of Default

  	
  77

  
	
  Section 6.2.

  	
  Acceleration

  	
  79

  
	
  Section 6.3.

  	
  Other Remedies

  	
  80

  
	
  Section 6.4.

  	
  Waiver of Existing
  Defaults

  	
  80

  
	
  Section 6.5.

  	
  Control by Majority

  	
  80

  
	
  Section 6.6.

  	
  Limitation on Suits

  	
  81

  
	
  Section 6.7.

  	
  Rights of Holders
  of Notes to Receive Payment

  	
  81

  
	
  Section 6.8.

  	
  Collection Suit by
  Trustee

  	
  81

  
	
  Section 6.9.

  	
  [Reserved]

  	
  82

  
	
  Section 6.10.

  	
  Trustee May File
  Proofs of Claim

  	
  82

  
	
  Section 6.11.

  	
  Priorities

  	
  82

  

 

ii

 

	
   

  	
   

  	
  Page

  
	
   

  	
   

  	
   

  
	
  Section 6.12.

  	
  Undertaking for
  Costs

  	
  83

  
	
   

  	
   

  	
   

  
	
  ARTICLE VII.

  	
   

  
	
   

  	
   

  	
   

  
	
  TRUSTEE

  	
   

  
	
   

  	
   

  
	
  Section 7.1.

  	
  Duties of Trustee

  	
  83

  
	
  Section 7.2.

  	
  Rights of Trustee

  	
  84

  
	
  Section 7.3.

  	
  Individual Rights
  of Trustee

  	
  85

  
	
  Section 7.4.

  	
  Trustee’s
  Disclaimer

  	
  85

  
	
  Section 7.5.

  	
  Notice of Defaults

  	
  86

  
	
  Section 7.6.

  	
  Reports by Trustee
  to Holder of the Notes

  	
  86

  
	
  Section 7.7.

  	
  Compensation,
  Reimbursement and Indemnity

  	
  86

  
	
  Section 7.8.

  	
  Replacement of
  Trustee

  	
  88

  
	
  Section 7.9.

  	
  Successor Trustee
  by Merger, Etc.

  	
  89

  
	
  Section 7.10.

  	
  Eligibility;
  Disqualification

  	
  89

  
	
  Section 7.11.

  	
  Preferential
  Collection of Claims Against Company

  	
  89

  
	
   

  	
   

  	
   

  
	
  ARTICLE VIII.

  	
   

  
	
   

  	
   

  	
   

  
	
  LEGAL DEFEASANCE AND COVENANT DEFEASANCE

  	
   

  
	
   

  	
   

  
	
  Section 8.1.

  	
  Option to Effect
  Legal Defeasance or Covenant Defeasance

  	
  89

  
	
  Section 8.2.

  	
  Legal Defeasance
  and Discharge

  	
  89

  
	
  Section 8.3.

  	
  Covenant Defeasance

  	
  90

  
	
  Section 8.4.

  	
  Conditions to Legal
  or Covenant Defeasance

  	
  91

  
	
  Section 8.5.

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

  	
  92

  
	
  Section 8.6.

  	
  Repayment to the
  Company

  	
  93

  
	
  Section 8.7.

  	
  Reinstatement

  	
  93

  
	
   

  	
   

  	
   

  
	
  ARTICLE IX.

  	
   

  
	
   

  	
   

  	
   

  
	
  AMENDMENT, SUPPLEMENT AND WAIVER

  	
   

  
	
   

  	
   

  
	
  Section 9.1.

  	
  Without Consent of
  Holders of Notes

  	
  93

  
	
  Section 9.2.

  	
  With Consent of
  Holders of Notes

  	
  95

  
	
  Section 9.3.

  	
  Compliance with
  Trust Indenture Act

  	
  96

  
	
  Section 9.4.

  	
  Revocation and
  Effect of Consents

  	
  96

  
	
  Section 9.5.

  	
  Notation on or
  Exchange of Notes

  	
  97

  
	
  Section 9.6.

  	
  Trustee to Sign
  Amendment, Etc.

  	
  97

  

 

iii

 

	
   

  	
   

  	
  Page

  
	
   

  	
   

  	
   

  
	
  ARTICLE X.

  	
   

  
	
   

  	
   

  	
   

  
	
  [RESERVED]

  	
   

  
	
   

  	
   

  
	
  ARTICLE XI.

  	
   

  
	
   

  	
   

  	
   

  
	
  GUARANTEE

  	
   

  
	
   

  	
   

  
	
  Section 11.1.

  	
  Unconditional
  Guarantee

  	
  97

  
	
  Section 11.2.

  	
  [Reserved]

  	
  98

  
	
  Section 11.3.

  	
  Severability

  	
  98

  
	
  Section 11.4.

  	
  Limitation of
  Guarantor’s Liability

  	
  99

  
	
  Section 11.5.

  	
  Release of
  Guarantor

  	
  99

  
	
  Section 11.6.

  	
  Contribution

  	
  99

  
	
  Section 11.7.

  	
  Waiver of
  Subrogation

  	
  100

  
	
  Section 11.8.

  	
  Notation Not
  Required

  	
  100

  
	
  Section 11.9.

  	
  Waiver of Stay,
  Extension or Usury Laws

  	
  100

  
	
   

  	
   

  	
   

  
	
  ARTICLE XII.

  	
   

  
	
   

  	
   

  	
   

  
	
  SATISFACTION AND DISCHARGE

  	
   

  
	
   

  	
   

  
	
  Section 12.1.

  	
  Satisfaction and
  Discharge

  	
  101

  
	
  Section 12.2.

  	
  Application of
  Trust

  	
  102

  
	
   

  	
   

  	
   

  
	
  ARTICLE XIII.

  	
   

  
	
   

  	
   

  	
   

  
	
  MISCELLANEOUS

  	
   

  
	
   

  	
   

  
	
  Section 13.1.

  	
  Trust Indenture Act
  Controls

  	
  102

  
	
  Section 13.2.

  	
  Notices

  	
  102

  
	
  Section 13.3.

  	
  Communication by
  Holders of Notes with Other Holders of Notes

  	
  104

  
	
  Section 13.4.

  	
  Certificate and
  Opinion as to Conditions Precedent

  	
  104

  
	
  Section 13.5.

  	
  Statements Required
  in Certificate or Opinion

  	
  104

  
	
  Section 13.6.

  	
  Rules by Trustee
  and Agents

  	
  105

  
	
  Section 13.7.

  	
  No Personal
  Liability of Directors, Officers, Employees and Stockholders

  	
  105

  
	
  Section 13.8.

  	
  Governing Law;
  Submission to Jurisdiction; Waiver of Jury Trial

  	
  105

  
	
  Section 13.9.

  	
  No Adverse
  Interpretation of Other Agreements

  	
  105

  
	
  Section 13.10.

  	
  Successors

  	
  105

  
	
  Section 13.11.

  	
  Severability

  	
  105

  
	
  Section 13.12.

  	
  Counterpart
  Originals

  	
  106

  
	
  Section 13.13.

  	
  Table of Contents,
  Headings, Etc.

  	
  106

  
	
  Section 13.14.

  	
  Qualification of
  Indenture

  	
  106

  

 

iv

 

	
  EXHIBITS

  
	
   

  
	
  Exhibit A

  	
  Form of Initial
  Floating Rate Note

  
	
   

  	
   

  
	
  Exhibit B

  	
  Form of
  Initial Fixed Rate Note

  
	
   

  	
   

  
	
  Exhibit C

  	
  Form of
  Exchange Floating Rate Note

  
	
   

  	
   

  
	
  Exhibit D

  	
  Form of
  Exchange Fixed Rate Note

  
	
   

  	
   

  
	
  Exhibit E

  	
  Form of
  Supplemental Indenture in Respect of Guarantee

  
	
   

  	
   

  
	
  Exhibit F(1)

  	
  Form of
  Regulation S Certification

  
	
   

  	
   

  
	
  Exhibit F(2)

  	
  Form of
  Certificate to Be Delivered upon Exchange or Registration of Transfer of
  Notes

  
	
   

  	
   

  
	
  Exhibit G

  	
  Form of
  Certificate to Be Delivered in Connection with Transfers to Non-QIB Accredited
  Investors

  
	
   

  	
   

  
	
  Exhibit H

  	
  Form of
  Certificate to Be Delivered in Connection with Transfers Pursuant to
  Regulation S

  

 

v

 

INDENTURE

 

INDENTURE
dated as of July 5, 2005 among Compression Polymers Holding Corporation, a
Delaware corporation (the “Company”), the Guarantors (as defined herein)
party hereto from time to time, and Wells Fargo Bank, N.A., a national banking
association, as trustee (the “Trustee”).

 

Each party
agrees as follows for the benefit of the other parties and for the equal and
ratable benefit of the Holders (as defined below) of the Company’s Floating
Rate Notes (as defined below) and Fixed Rate Notes (as defined below).

 

ARTICLE I.

 

DEFINITIONS AND INCORPORATION BY REFERENCE

 

Section 1.1.                                   Definitions.

 

“Acquired
Indebtedness” means Indebtedness of a Person or any of its Subsidiaries
existing at the time such Person becomes a Restricted Subsidiary or at the time
it merges or consolidates with the Company or any of its Restricted
Subsidiaries or assumed in connection with the acquisition of assets from such
Person and in each case not incurred by such Person in connection with, or in
anticipation or contemplation of, such Person becoming a Restricted Subsidiary
or such acquisition, merger or consolidation; provided that any Indebtedness of such Person that is
extinguished, redeemed, defeased, retired or otherwise repaid at the time of or
immediately upon consummation of the transaction pursuant to which such Person
becomes a Restricted Subsidiary will not be Acquired Indebtedness.

 

“Acquisition” means the transactions contemplated
by the Stock Purchase Agreement, including any borrowings under the Credit
Agreement and the offering of the Notes.

 

“Additional
Fixed Rate Notes” means 101⁄2% senior notes due 2013 issued from time to time
after the Issue Date pursuant to Article II and in compliance with
Section 4.9 and ranking equally with the
Initial Fixed Rate Notes in all respects (or
in all respects other than the payment of interest accruing prior to the issue
date of such Additional Fixed Rate Notes).

 

“Additional
Floating Rate Notes” means senior floating rate notes due 2012 issued from
time to time after the Issue Date pursuant to Article II and in compliance with
Section 4.9 and ranking equally with the Initial Floating Rate Notes in all
respects (or in all respects other than the
payment of interest accruing prior to the issue date of such Additional Floating
Rate Notes).

 

“Additional
Interest” means all additional interest then owing pursuant to Section 2
of the Registration Rights Agreement.

 

“Additional
Notes” means Additional Fixed Rate Notes and Additional Floating Rate
Notes.

 

 

“Affiliate”
means, with respect to any specified Person, any other Person who directly or
indirectly through one or more intermediaries controls, or is controlled by, or
is under common control with, such specified Person.  The term “control” means the possession,
directly or indirectly, of the power to direct or cause the direction of the
management and policies of a Person, whether through the ownership of voting
securities, by contract or otherwise; and the terms “controlling” and
“controlled” have meanings correlative of the foregoing. The term “Affiliate,”
with respect to the Company and the Guarantors, shall not include the Initial
Purchaser or any of its Affiliates.

 

“Affiliate
Transaction” has the meaning set forth under Section 4.11.

 

“Agent”
means any Registrar, Paying Agent or co-registrar.

 

“Asset Acquisition” means

 

(1)           an
Investment by the Company or any Restricted Subsidiary in any other Person
pursuant to which such Person shall become a Restricted Subsidiary or shall be
merged with or into the Company or any Restricted Subsidiary; or

 

(2)           the
acquisition by the Company or any Restricted Subsidiary of the assets of any
Person (other than a Restricted Subsidiary) which constitute all or
substantially all of the assets of such Person or comprise any division or line
of business of such Person or any other properties or assets of such Person
other than in the ordinary course of business.

 

“Asset Sale”
means any direct or indirect sale, issuance, conveyance, transfer, lease (other
than operating leases entered into in the ordinary course of business),
assignment or other transfer for value by the Company or any of its Restricted
Subsidiaries (including any Sale and Leaseback Transaction) to any Person other
than the Company or a Restricted Subsidiary of:

 

(1)           any
Capital Stock of any Restricted Subsidiary; or

 

(2)           any
other property or assets of the Company or any Restricted Subsidiary,

 

in each case,
other than in the ordinary course of business; provided, however,
that Asset Sales shall not include:

 

(a)           a
transaction or series of related transactions for which the Company or its Restricted
Subsidiaries receive aggregate consideration of less than $3.0 million,

 

(b)           the
sale, lease, conveyance, disposition or other transfer of all or substantially
all of the Company’s assets (determined on a consolidated basis for the Company
and its Restricted Subsidiaries) as permitted under Section 5.1 or any
disposition that constitutes a Change of Control,

 

(c)           the
sale, lease, conveyance, disposition or other transfer of products, services,
inventory or accounts receivable in the ordinary course of business and

 

2

 

disposals or replacements of damaged, worn-out or obsolete assets or
assets no longer useful in the business,

 

(d)           an
issuance of securities by a Restricted Subsidiary to the Company or another
Restricted Subsidiary or the sale, lease, conveyance, disposition or other
transfer by the Company or any Restricted Subsidiary of assets or property to
the Company or one or more Restricted Subsidiaries (including any Person that
becomes a Restricted Subsidiary in connection with such transactions),

 

(e)           any
transfer of property or assets or issuance of Capital Stock that is a Restricted
Payment or Investment permitted under Section 4.7 or any Permitted Investment,

 

(f)            the
sale or other disposition of cash or Cash Equivalents,

 

(g)           a
transfer of assets, by means of trade-in, of equipment owned by the Company and
used or previously used in the ordinary course of business, so long as such
equipment is replaced, substantially concurrently, by like-kind equipment,

 

(h)           any
issuance of, or disposition in connection with, directors’ qualifying shares or
investments by foreign nationals mandated by foreign law,

 

(i)            the
licensing or sublicensing of intellectual property or other general intangibles
to the extent that such license does not prohibit the licensor from using the intellectual
property and licenses, leases or subleases of other property in the ordinary
course of business,

 

(j)            a
transfer of property or assets that is a surrender or waiver of contract rights
or the settlement, release or surrender of contract, tort or other claims of
any kind,

 

(k)           the
sale of any property in a Sale and Leaseback Transaction within one year of the
acquisition of such property,

 

(l)            any
sale or disposition deemed to occur in connection with creating, granting or exercising
remedies, including foreclosure, in respect of any Liens pursuant to Section
4.12, and

 

(m)          any
sale of Capital Stock in, or Indebtedness or other securities of, an Unrestricted
Subsidiary.

 

“Bankruptcy
Law” means Title 11, United States Bankruptcy Code of 1978, as
amended, or any similar Federal or state law for the relief of debtors.

 

“Board of
Directors” means, as to any Person, the board of directors or advisory
board of such Person or any duly authorized committee thereof.

 

“Board
Resolution” means, with respect to any Person, a copy of a resolution certified
by the Secretary or an Assistant Secretary or any Officer of such Person to
have been

 

3

 

duly adopted by the Board of Directors of such Person and to be in full
force and effect on the date of such certification, and delivered to the
Trustee.

 

“Business
Day” means a day other than a Saturday, Sunday or other day in which commercial
banking institutions (including, without limitation, the Federal Reserve
System) are authorized or required by law to close in New York City. If a
payment date is not a Business Day, payment shall be made on the next
succeeding Business Day.

 

“Capitalized
Lease Obligation” means, as to any Person, the obligations of such Person
under a lease that are required to be classified and accounted for as capital
lease obligations under GAAP and, for purposes of this definition, the amount
of such obligations at any date shall be the capitalized amount of such
obligations at such date on a balance sheet prepared in accordance with GAAP.

 

“Capital
Stock” means:

 

(1)           with
respect to any Person that is a corporation, any and all shares, interests,
participations or other equivalents (however designated and whether or not
voting) of corporate stock, including each class of Common Stock and Preferred
Stock of such Person; and

 

(2)           with
respect to any Person that is not a corporation, any and all partnership, membership
or other equity interests of such Person.

 

“Cash Equivalents” means:

 

(1)           marketable
direct obligations issued by, or unconditionally guaranteed by, the United
States government or issued by any agency thereof and backed by the full faith
and credit of the United States, in each case maturing within two years from
the date of acquisition thereof;

 

(2)           marketable
direct obligations issued by any state, commonwealth or territory of the United
States of America or any political subdivision of any such state, commonwealth
or territory or any public instrumentality thereof maturing within two years
from the date of acquisition thereof and, at the time of acquisition, having an
investment grade rating from either S&P or Moody’s;

 

(3)           commercial
paper or other indebtedness maturing no more than one year from the date of
creation thereof and, at the time of acquisition, having a rating of at least
A-1 from S&P or at least P-1 from Moody’s (or, if at any time neither
S&P nor Moody’s shall be rating such obligations, then an equivalent rating
from another nationally recognized rating service);

 

(4)           certificates
of deposit, time deposits and eurodollar time deposits or bankers’ acceptances
maturing within two years from the date of acquisition thereof and overnight
bank deposits issued by any bank organized under the laws of the United States
of America or any state thereof or the District of Columbia or any U.S. branch
of a foreign bank having at the date of acquisition thereof combined capital
and surplus of not

 

4

 

less than $250.0 million in the case of domestic banks and $100.0
million (or the dollar equivalent thereof) in the case of foreign banks;

 

(5)           repurchase
obligations for underlying securities of the types described in clauses (1),
(2) and (4) above entered into with any bank meeting the qualifications specified
in clause (4) above or securities dealers of recognized national standing;

 

(6)           United
States dollars, euros, pounds sterling and local currencies held by Foreign
Subsidiaries from time to time in the ordinary course of business;

 

(7)           in
the case of any investment by a Foreign Subsidiary or investments made in a
country outside the United States of America, “Cash Equivalents” shall also
include:  (i) direct obligations of
the sovereign nation (or any agency thereof) in which such Foreign Subsidiary
is organized and is conducting business or obligations fully and unconditionally
guaranteed by such sovereign nation (or agency thereof) and (ii) other
customarily utilized high-quality investments in the country where such Subsidiary
is located or in which such investment is made; and

 

(8)           investments
in money market funds or shares of investment companies that are registered
under the Investment Company Act of 1940 that invest substantially all their
assets in securities of the types described in clauses (1) through (7) above.

 

Notwithstanding
the foregoing, Cash Equivalents shall include amounts denominated in currencies
other than those set forth in clauses (1), (2) and (6) above, provided that such amounts are
converted into any currency listed in clauses (1), (2) and (6) above as
promptly as practicable and in any event within ten Business Days following the
receipt of such amounts.

 

“Certificated
Notes” means, collectively, the U.S. Certificated Notes and the Offshore
Certificated Notes.

 

“Change of
Control” means the occurrence of one or more of the following events:

 

(1)           any
sale, lease, exchange or other transfer (in one transaction or a series of
related transactions) of all or substantially all of the Company’s assets
(determined on a consolidated basis for the Company and its Restricted
Subsidiaries) to any Person or group of related Persons for purposes of Section
13(d) of the Exchange Act (a “Group”), together with any Affiliates
thereof (whether or not otherwise in compliance with the provisions of this
Indenture), other than to a Permitted Holder;

 

(2)           the
approval by the holders of Capital Stock of the Company of any plan or proposal
for the liquidation or dissolution of the Company (whether or not otherwise in
compliance with the provisions of this Indenture);

 

(3)           any
Person or Group, other than a Permitted Holder, shall become the owner,
directly or indirectly, beneficially or of record, of shares representing more
than

 

5

 

50% of the aggregate ordinary voting power represented by the issued
and outstanding Capital Stock of the Company; or

 

(4)           the
replacement of a majority of the Board of Directors of the Company over a
two-year period from the directors who constituted the Board of Directors of
the Company at the beginning of such period, and such replacement shall not
have been approved by a vote of at least a majority of the Board of Directors
of the Company then still in office who either were members of any such Board
of Directors at the beginning of such period or whose election as a member of
any such Board of Directors was previously so approved.

 

“Change of
Control Offer” has the meaning set forth under Section 4.15.

 

“Change of
Control Payment Date” has the meaning set forth under Section 3.9(b).

 

“Clearstream”
shall mean Clearstream Banking, Société Anonyme, Luxembourg.

 

“Commission”
means the U.S. Securities and Exchange Commission or any successor agency
thereto.

 

“Common
Stock” of any Person means any and all shares, interests or other participations
in, and other equivalents (however designated and whether voting or non-voting)
of, such Person’s common stock, whether outstanding on the Issue Date or issued
after the Issue Date, and includes, without limitation, all series and classes
of such common stock.

 

“Company”
means Compression Polymers Holding Corporation, a Delaware corporation, until a
successor Person shall have become such pursuant to the applicable provisions
of this Indenture, and thereafter means such successor Person.

 

“Consolidated
EBITDA” means, for any period, the sum (without duplication) of:

 

(1)           Consolidated
Net Income for such period; and

 

(2)           to
the extent Consolidated Net Income has been reduced thereby,

 

(a)           all
income taxes of the Company and its Restricted Subsidiaries paid or accrued in
accordance with GAAP for such period,

 

(b)           Consolidated
Interest Expense for such period,

 

(c)           Consolidated
Non-cash Charges for such period less any non-cash items increasing
Consolidated Net Income for such period, all as determined on a consolidated
basis for the Company and its Restricted Subsidiaries in accordance with GAAP,

 

6

 

(d)           income
or loss attributable to discontinued operations (including, without limitation,
operations disposed of during such period whether or not such operations were
classified as discontinued), and

 

(e)           amounts
payable to the Sponsor pursuant to the Management Agreement as in effect on the
Issue Date.

 

“Consolidated
Fixed Charge Coverage Ratio” means the ratio of Consolidated EBITDA during
the four most recent full fiscal quarters (the “Four Quarter Period”)
for which financial statements are available ending on or prior to the date of
the transaction giving rise to the need to calculate the Consolidated Fixed
Charge Coverage Ratio (the “Transaction Date”) to Consolidated Fixed
Charges for the Four Quarter Period.  In
addition to and without limitation of the foregoing, for purposes of this
definition, “Consolidated EBITDA” and “Consolidated Fixed Charges” shall be
calculated after giving effect on a pro forma basis for the period of such calculation
to:

 

(1)           the
incurrence or repayment of any Indebtedness of the Company or any of its
Restricted Subsidiaries (and the application of the proceeds thereof) giving
rise to the need to make such calculation and any incurrence or repayment of
other Indebtedness (and the application of the proceeds thereof), other than
the incurrence or repayment of Indebtedness in the ordinary course of business
under revolving credit facilities, occurring during the Four Quarter Period or
at any time subsequent to the last day of the Four Quarter Period and on or
prior to the Transaction Date, as if such incurrence or repayment, as the case
may be (and the application of the proceeds thereof), occurred on the first day
of the Four Quarter Period; and

 

(2)           any
asset sales or Asset Acquisitions (including, without limitation, any Asset
Acquisition giving rise to the need to make such calculation as a result of the
Company or one of its Restricted Subsidiaries (including any Person who becomes
a Restricted Subsidiary as a result of the Asset Acquisition) incurring,
assuming or otherwise being liable for Acquired Indebtedness and also including
any Consolidated EBITDA attributable to the assets that are the subject of the
Asset Acquisition or asset sale during the Four Quarter Period) occurring
during the Four Quarter Period or at any time subsequent to the last day of the
Four Quarter Period and on or prior to the Transaction Date, as if such asset
sale or Asset Acquisition (including the incurrence, assumption or liability
for any such Acquired Indebtedness) occurred on the first day of the Four
Quarter Period, including giving effect to any Pro Forma Cost Savings.

 

If the Company
or any of its Restricted Subsidiaries directly or indirectly guarantees
Indebtedness of a third Person, the preceding sentence shall give effect to the
incurrence of such guaranteed Indebtedness as if the Company or any such Restricted
Subsidiary had directly incurred or otherwise assumed such guaranteed Indebtedness.

 

7

 

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

 

(1)           any
Person that is a Restricted Subsidiary on the Transaction Date shall be deemed
to have been a Restricted Subsidiary at all times during the Four Quarter
Period;

 

(2)           any
Person that is not a Restricted Subsidiary on the Transaction Date shall be
deemed not to have been a Restricted Subsidiary at any time during the Four
Quarter Period;

 

(3)           interest
on a Capitalized Lease Obligation shall be deemed to accrue at an interest rate
reasonably determined by a responsible financial or accounting officer of the
Company to be the rate of interest implicit in such Capitalized Lease
Obligation in accordance with GAAP; and

 

(4)           interest
on any Indebtedness under a revolving credit facility computed on a pro forma
basis shall be computed based upon the average daily balance of such Indebtedness
during the applicable period.

 

Furthermore,
in calculating “Consolidated Fixed Charges” for purposes of determining the
denominator (but not the numerator) of this “Consolidated Fixed Charge Coverage
Ratio”:

 

(1)           interest
on outstanding Indebtedness determined on a fluctuating basis as of the
Transaction Date and that will continue to be so determined thereafter shall be
deemed to have accrued at a fixed rate per annum equal to the rate of interest
on such Indebtedness in effect on the Transaction Date;

 

(2)           if
interest on any Indebtedness actually incurred on the Transaction Date may optionally
be determined at an interest rate based upon a factor of a prime or similar
rate, a eurocurrency interbank offered rate, or other rates, then the interest
rate in effect on the Transaction Date will be deemed to have been in effect
during the Four Quarter Period; and

 

(3)           notwithstanding
clause (1) above, interest on Indebtedness determined on a fluctuating basis,
to the extent such interest is covered by agreements relating to Interest Swap
Obligations, shall be deemed to accrue at the rate per annum resulting after
giving effect to the operation of such agreements.

 

“Consolidated
Fixed Charges” means, with respect to the Company for any period, the sum,
without duplication, of:

 

(1)           Consolidated
Interest Expense for such period; plus

 

(2)           the
amount of all cash dividend payments (excluding items eliminated in
consolidation) on any series of Preferred Stock of the Company (other than
dividends paid in Qualified Capital Stock) paid, accrued or scheduled to be
paid or accrued during such period.

 

8

 

“Consolidated
Interest Expense” means, for any period, the sum of, without duplication:

 

(1)           the
aggregate of the interest expense of the Company and its Restricted
Subsidiaries for such period determined on a consolidated basis in accordance
with GAAP, plus

 

(2)           the
interest component of Capitalized Lease Obligations paid, accrued and/or
scheduled to be paid or accrued by the Company and its Restricted Subsidiaries
during such period as determined on a consolidated basis in accordance with
GAAP, less

 

(3)           interest
income for such period.

 

“Consolidated
Interest Expense” shall exclude (x) the amortization or write-off of deferred
financing fees, debt issuance costs and any expensing of bridge or other
financing fees, (y) the interest attributable to market exclusivity
payment liabilities and (z) any non-cash interest expense attributable to the
movement in the mark to market valuation of Hedging Obligations or other
derivative instruments pursuant to Financial Accounting Standards Board Statement
No. 133—”Accounting for Derivative Instruments and Hedging Activities” or
otherwise.

 

“Consolidated
Net Income” means, with respect to the Company for any period, the aggregate
net income (or loss) of the Company and its Restricted Subsidiaries for such
period on a consolidated basis, determined in accordance with GAAP; provided
that there shall be excluded therefrom:

 

(1)           after-tax
gains or losses from Asset Sales (without regard to the $3.0 million limitation
set forth in the definition thereof) or abandonment or reserves relating
thereto;

 

(2)           after-tax
extraordinary or nonrecurring gains or losses and any unusual or nonrecurring
charges (including severance, relocation costs and one-time compensation
charges and including restructuring charges or reserves including costs related
to closure of facilities), including any expenses, charges, gains or losses incurred
in connection with any issuance of debt or equity;

 

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

 

(4)           solely
for the purposes of Section 4.7, the net income (but not loss) of any
Restricted Subsidiary to the extent that the declaration of dividends or similar
distributions by that Restricted Subsidiary of that income is restricted by a
contract, operation of law or otherwise, except to the extent that such Net
Income is actually paid in cash to the Company or its Restricted Subsidiaries;

 

(5)           the
net income of any Person, other than the Company or a Restricted Subsidiary,
except to the extent of cash dividends or distributions paid to the Company or
to a Restricted Subsidiary by such Person;

 

9

 

(6)           in
the case of a successor to the Company by consolidation or merger or as a
transferee of the Company’s assets, any net income of the successor corporation
prior to such consolidation, merger or transfer of assets;

 

(7)           the
amortization of any premiums, fees or expenses incurred in connection with the
Refinancing Transaction, the Acquisition or any other acquisition by the
Company or any of its Restricted Subsidiaries of assets or Capital Stock or any
amounts required or permitted by Accounting Principles Board Opinions Nos. 16
(including non-cash write-ups and non-cash charges relating to inventory and
fixed assets, in each case arising in connection with such acquisition) and 17
(including non-cash charges relating to intangibles and goodwill) to be
recorded on the Company’s consolidated balance sheet, in each case in connection
with the Refinancing Transaction, the Acquisition or such other acquisitions;

 

(8)           any
non-cash compensation charge arising from the grant or issuance of stock, stock
options or other equity-based awards;

 

(9)           unrealized
gains and losses with respect to Hedging Obligations or other derivative
instruments pursuant to Financial Accounting Standards Board Statement No.
133—”Accounting for Derivative Instruments and Hedging Activities” or otherwise;

 

(10)         any
non-cash impact attributable to the application of the purchase method of
accounting in accordance with GAAP, including, without limitation, the total
amount of depreciation and amortization, cost of sales or other non-cash
expense resulting from the write-up of assets for such period on a consolidated
basis in accordance with GAAP to the extent such non-cash expense results from
such purchase accounting adjustments;

 

(11)         fees,
costs and expenses incurred by the Company or any of its Subsidiaries during
any period in connection with any acquisition by the Company or any of its
Subsidiaries (including the Acquisition), the Refinancing Transaction and the
Exchange Offers and related transactions (including, without limitation,
amortization of debt issuance costs, debt discount or premium and other
financing fees and expenses directly relating thereto and write-offs of any
debt issuance costs relating to Indebtedness being retired or repaid in
connection with such acquisition, as well as bonus payments paid to employees
in connection with such acquisition);

 

(12)         any
net after-tax income (loss) from the early extinguishment of Indebtedness or
Hedging Obligations or other derivative instruments or amortization or
write-off of deferred financing fees and any expenses of bridge or other
financing fees; and

 

(13)         any
impairment charge or asset write-off pursuant to Financial Accounting Standards
Board Statement No. 142 and No. 144 and the amortization of intangibles arising
pursuant to No. 141.

 

“Consolidated
Net Tangible Assets” means the aggregate amount of assets of the Company
(less applicable reserves and other properly deductible items) after deducting
therefrom (to the extent otherwise included therein) all goodwill, trade names,
trademarks,

 

10

 

patents, unamortized debt discount and expense and other like
intangibles, all as set forth on the books and records of the Company and its
Restricted Subsidiaries on a consolidated basis and in accordance with GAAP.

 

“Consolidated
Non-cash Charges” means, for any period, the aggregate depreciation,
amortization and other non-cash expenses of the Company (including, without
limitation, charges related to the impairment of intangibles) and its
Restricted Subsidiaries reducing Consolidated Net Income of the Company for
such period, determined on a consolidated basis in accordance with GAAP
(including deferred rent but excluding any such charge which requires an
accrual of or a reserve for cash charges for any future period).

 

“Corporate
Trust Office of the Trustee” means the principal office of the Trustee at
which at any time its corporate trust business shall be principally
administered, which office at the date hereto is located at 213 Court Street,
Suite 703, Middletown, CT 06457, or such other address as the Trustee may designate
from time to time by written notice to the Holders and the Company, or the
principal corporate trust office of any successor Trustee (or such other
address as such successor Trustee may designate from time to time by notice to
the Holders and the Company).

 

“Covenant
Defeasance” has the meaning set forth under Section 8.3.

 

“CPH I”
means Compression Polymers Holding I LP, or any successor entity.

 

“Credit
Agreement” means the Credit Agreement dated as of the May 10, 2005 by and
among the Company, the guarantors from time to time party thereto, the lenders
from time to time party thereto in their capacities as lenders thereunder and
Wachovia Bank, National Association, as agent, together with the related
documents thereto (including, without limitation, any guarantee agreements and
security documents), in each case as such agreements may be amended (including
any amendment and restatement thereof), supplemented or otherwise modified from
time to time, including any agreement extending the maturity of, refinancing
(including pursuant to indentures, credit facilities or commercial paper
facilities with banks, investors or institutional investors or by means of
sales of debt securities to institutional investors or others), replacing or
otherwise restructuring (including increasing the amount of available borrowings
thereunder or adding Subsidiaries of the Company as additional borrowers or
guarantors thereunder) all or any portion of the Indebtedness under such
agreement or any successor or replacement agreement and whether by the same or
any other agent, lender or group of lenders or other party.

 

“Credit
Facility” means one or more debt facilities (including, without limitation,
the Credit Agreement), financings, commercial paper facilities or other debt
instruments, indentures or agreements providing for revolving credit loans,
term loans, receivables financing (including through the sale of receivables to
such lenders or to special purpose entities formed to borrow from such lenders
against such receivables), notes or letters of credit, bank products or other
debt obligations and, in each case, as such agreements may be amended, amended
and restated, supplemented, modified, renewed, refunded, refinanced, replaced
or otherwise restructured, in whole or in part from time to time (including
increasing the amount of available borrowings thereunder or adding Restricted
Subsidiaries of the Company as additional borrowers

 

11

 

or guarantors thereunder) with respect to all or any portion of the
Indebtedness under such agreement or agreements or any successor or replacement
agreement or agreements and whether by the same or any other agent, lender or
group of lenders or other party.

 

“Currency
Agreement” means any foreign exchange contract, currency swap agreement or
other similar agreement or arrangement designed to protect the Company or any
Restricted Subsidiary against fluctuations in currency values.

 

“Default”
means an event or condition the occurrence of which is, or with the lapse of
time or the giving of notice or both would be, an Event of Default.

 

“Depositary”
means, with respect to the Notes issuable in whole or in part in global form,
the Person specified in Section 2.6 as the Depositary with respect to the
Notes, until a successor shall have been appointed and become such pursuant to
the applicable provisions of this Indenture, and, thereafter, “Depositary”
shall mean or include such successor.

 

“Designated Non-cash Consideration” means the Fair
Market Value of non-cash consideration received by the Company or a Restricted
Subsidiary in connection with an Asset Sale that is so designated as Designated
Non-cash Consideration pursuant to an Officers’ Certificate, setting forth the
basis of such valuation, executed by an authorized officer of the Company, less
the amount of cash or Cash Equivalents received in connection with a subsequent
sale of such Designated Non-cash Consideration.

 

“Designated Preferred Stock” means Preferred Stock
of the Company or any direct or indirect parent entity of the Company (in each
case other than Disqualified Capital Stock) that is issued for cash (other than
to a Restricted Subsidiary) and is so designated as Designated Preferred Stock,
pursuant to an Officer’s Certificate executed by an officer of the Company or
the applicable parent entity, as the case may be, on the issuance date thereof,
the cash proceeds of which are excluded from the calculation provided in Section
4.7.

 

“Designation”
has the meaning set forth under Section 4.18.

 

“Designation
Amount” has the meaning set forth under Section 4.18.

 

“Disqualified
Capital Stock” means that portion of 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), or upon the happening of any event, matures or is mandatorily
redeemable, pursuant to a sinking fund obligation or otherwise, or is
redeemable at the sole option of the holder thereof, on or prior to the date
that is 91 days after the date on which the Notes mature, unless any such obligation
can only be satisfied by delivery of Capital Stock which is not Disqualified
Capital Stock.  Notwithstanding the
preceding sentence, any Capital Stock that would constitute Disqualified Capital
Stock solely because the holders of such Capital Stock have the right to
require the Company to repurchase such Capital Stock upon the occurrence of a
change of control or an asset sale will not constitute Disqualified Stock if
the terms of such Capital Stock provide that the Company may not repurchase or
redeem any such Capital Stock pursuant to such provisions unless such
repurchase or redemption complies with Section 4.7.  The amount of Disqualified Capital Stock
deemed to be outstanding at any time for purposes of this Indenture will be the
maximum amount that the Company and its Restricted Subsidiaries

 

12

 

may become obligated to pay upon the maturity of, or pursuant to any
mandatory redemption provisions of, such Disqualified Capital Stock, exclusive
of accrued dividends; provided that any class of Capital Stock of
such Person that, by its terms, authorized such Person to satisfy in full its
obligations with respect to payment of dividends or upon maturity, redemption
(pursuant to a sinking fund or otherwise) or repurchase thereof or other
payment obligations or otherwise by delivery of Capital Stock that is not
Disqualified Capital Stock, and that is not convertible, puttable or
exchangeable for Disqualified Stock or Indebtedness, will not be deemed
Disqualified Capital Stock so long as such Person satisfied its obligations
with respect thereto solely by the delivery of Capital Stock that is not Disqualified
Capital Stock.

 

“Equity
Offering” means any public or private sale of Qualified Capital Stock of
the Company or any direct or indirect parent entity of the Company; provided
that, in the event of an Equity Offering by any direct or indirect parent
entity of the Company, such parent entity contributes to the capital of the
Company the portion of the net cash proceeds of such Equity Offering necessary
to pay the aggregate Redemption Price (plus accrued interest to the Redemption
Date) of the Notes to be redeemed pursuant to Section 3.8.

 

“Euroclear”
means Morgan Guaranty Trust Company of New York, Brussels office, as
operator of the Euroclear System.

 

“Exchange
Act” means the Securities Exchange Act of 1934, as amended, or any successor
statute or statutes thereto and the rules and regulations promulgated by the
Commission thereunder.

 

“Exchange
Fixed Rate Notes” means notes issued by the Company hereunder containing
terms identical to the Initial Fixed Rate Notes (except (i) that interest
thereon shall accrue from the last date on which interest was paid on the
Initial Fixed Rate Notes or, if no such interest has been paid, from the date
of original issuance, (ii) that the legend or legends relating to
transferability and other related matters set forth on the Initial Fixed Rate
Notes, including the Private Placement Legend, shall be removed or appropriately
altered and (iii) as otherwise set forth herein), to be offered to Holders
of Initial Fixed Rate Notes in exchange for Exchange Fixed Rate Notes pursuant
to an Exchange Offer or any exchange offer specified in any registration rights
agreement relating to the Additional Fixed Rate Notes or to be offered in
connection with any issuance of Additional Fixed Rate Notes pursuant to a
registration statement filed pursuant to the Securities Act.

 

“Exchange
Floating Rate Notes” means notes issued by the Company hereunder containing
terms identical to the Initial Floating Rate Notes (except (i) that
interest thereon shall accrue from the last date on which interest was paid on
the Initial Floating Rate Notes or, if no such interest has been paid, from the
date of original issuance, (ii) that the legend or legends relating to
transferability and other related matters set forth on the Initial Floating
Rate Notes, including the Private Placement Legend, shall be removed or
appropriately altered and (iii) as otherwise set forth herein), to be
offered to Holders of Initial Floating Rate Notes in exchange for Exchange
Floating Rate Notes pursuant to an Exchange Offer or any exchange offer
specified in any registration rights agreement relating to the Additional
Floating Rate Notes or to be offered in connection with any issuance of
Additional Floating Rate Notes pursuant to a registration statement filed
pursuant to the Securities Act.

 

13

 

“Exchange
Notes” means the Exchange Fixed Rate Notes and the Exchange Floating Rate
Notes.

 

“Exchange
Offer” means an offer that shall be made by the Company pursuant to the
Registration Rights Agreement to exchange Initial Notes for Exchange Notes.

 

“fair
market value” means, with respect to any asset or property, the price which
could be negotiated in an arm’s-length, free market transaction, for cash,
between a willing seller and a willing and able buyer, neither of whom is under
undue pressure or compulsion to complete the transaction.  Fair market value shall be determined by the
Board of Directors of the Company acting reasonably and in good faith with
respect to transactions in excess of $5.0 million.

 

“Final
Memorandum” means the Company’s offering memorandum, dated June 29, 2005,
relating to the offering and sale of the Initial Notes.

 

“Fixed Rate
Notes” means the Initial Fixed Rate Notes, the Exchange Fixed Rate Notes
and any Additional Fixed Rate Notes.

 

“Floating
Rate Notes” means the Initial Floating Rate Notes, the Exchange Floating
Rate Notes and any Additional Floating Rate Notes.

 

“Foreign
Subsidiary” means any Restricted Subsidiary of the Company that (x) is
not organized under the laws of the United States of America or any State
thereof or the District of Columbia or (y) was organized under the laws of
the United States of America or any State thereof or the District of Columbia
that has no material assets other than Capital Stock of one or more foreign
entities of the type described in clause (x) above.

 

“Four
Quarter Period” has the meaning set forth under the definition of “Consolidated
Fixed Charge Coverage Ratio.”

 

“GAAP”
means generally accepted accounting principles set forth in the opinions and
pronouncements of the Accounting Principles Board of the American Institute of
Certified Public Accountants and statements and pronouncements of the Financial
Accounting Standards Board, the Public Company Accounting Oversight Board or in
such other statements by such other entity as may be approved by a significant
segment of the accounting profession of the United States, which are in effect
as of the Issue Date.

 

“Guarantee”
means each guarantee of the Company’s obligations under this Indenture and the
Notes by a Guarantor.

 

“Guarantor”
means Holdings and each of the Company’s Restricted Subsidiaries (other than
Foreign Subsidiaries) that executes a supplemental indenture in which such Restricted
Subsidiary agrees to be bound by the terms of this Indenture as a Guarantor; provided
that any Person constituting a Guarantor as described above shall cease to
constitute a Guarantor when its Guarantee is released in accordance with the
terms of this Indenture.

 

14

 

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

 

(1)           interest
rate swap agreements (whether from fixed to floating or from floating to
fixed), interest rate cap agreements and interest rate collar agreements;

 

(2)           other
agreements or arrangements designed to manage interest rates or interest rate
risk; and

 

(3)           other
agreements or arrangements designed to protect such Person against fluctuations
in currency exchange rates or commodity prices.

 

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

 

“Holdings”
means Compression Polymers Holding II Corporation, the direct parent of the
Company, or any successor entity.

 

“incur”
has the meaning set forth in Section 4.9.

 

“Indebtedness”
means, with respect to any Person, without duplication:

 

(1)           all
Obligations of such Person for borrowed money;

 

(2)           all
Obligations of such Person evidenced by bonds, debentures, notes or other
similar instruments;

 

(3)           all
Capitalized Lease Obligations of such Person;

 

(4)           all
Obligations of such Person representing the balance deferred and unpaid of the
purchase price of any property or services due more than six months after such
property is acquired or such services are completed and which is treated as
indebtedness under GAAP, except any such balance that constitutes an accrued expense
or trade payable, or similar obligations to trade creditors;

 

(5)           all
Obligations for the reimbursement of any obligor on any letter of credit,
banker’s acceptance or similar credit transaction;

 

(6)           guarantees
and other contingent obligations in respect of Indebtedness referred to in
clauses (1) through (5) above and clause (8) below (other than by endorsement
of negotiable instruments for cancellation in the ordinary course of business);

 

(7)           all
Obligations of any other Person of the type referred to in clauses (1) through
(6) which are secured by any lien on any property or asset of such Person, the
amount of such Obligation being deemed to be the lesser of the fair market
value of such property or asset or the amount of the Obligation so secured;

 

15

 

(8)           all
Interest Swap Obligations and all Obligations under currency agreements and interest
swap agreements of such Person; and

 

(9)           all
Disqualified Capital Stock issued by such Person and all Preferred Stock issued
by Restricted Subsidiaries of such Person with the amount of Indebtedness
represented by such Disqualified Capital Stock or Preferred Stock being equal
to the greater of its voluntary or involuntary liquidation preference and its
maximum fixed repurchase price, if and to the extent any of the preceding items
(other than letters of credit and Hedging Obligations) would appear as a
liability upon a balance sheet of the specified Person prepared in accordance
with GAAP.

 

Notwithstanding
the foregoing, “Indebtedness” shall not include (1) advance payments by
customers in the ordinary course of business for services or products to be
provided or delivered in the future, (2) deferred taxes, (3) obligations or
liabilities in respect of any Capital Stock, (4) take-or-pay obligations
contained in supply agreements or (5) contingent obligations (other than with
respect to borrowed money) incurred in the ordinary course of business.

 

For purposes
hereof, the “maximum fixed repurchase price” of any Disqualified Capital Stock
that does not have a fixed repurchase price shall be calculated in accordance
with the terms of such Disqualified Capital Stock as if such Disqualified
Capital Stock were purchased on any date on which Indebtedness shall be
required to be determined pursuant to this Indenture, and if such price is
based upon, or measured by, the fair market value of such Disqualified Capital
Stock, such fair market value shall be determined reasonably and in good faith
by the Board of Directors of the Company. The amount of Indebtedness of any
Person at any date shall be the outstanding balance on such date of all
unconditional Obligations as described above, and the maximum liability upon
the occurrence of the contingency giving rise to the Obligation, on any
contingent Obligations at such date; provided, however, that the
amount outstanding at any time of any Indebtedness incurred with original issue
discount is the face amount of such Indebtedness less the remaining unamortized
portion of the original issue discount of such Indebtedness at such time as
determined in conformity with GAAP.

 

“Indenture”
means this Indenture, as amended, supplemented or otherwise modified from time
to time, including, for all purposes of this Indenture and any such
supplemental indenture, the provisions of the Trust Indenture Act that are
deemed to be a part of and govern this instrument and any such supplemental
indenture, respectively.

 

“Independent Financial Advisor” means
a firm:

 

(1)           that
does not, and whose directors, officers and employees or Affiliates do not,
have a direct or indirect financial interest in the Company; and

 

(2)           that,
in the judgment of the Board of Directors of the Company, is otherwise
independent and qualified to perform the task for which it is to be engaged.

 

“Initial
Fixed Rate Notes” means the Company’s 101⁄2% Senior Notes due 2013 issued on
the Issue Date.

 

16

 

“Initial
Floating Rate Notes” means the Company’s Senior Floating Rate Notes due
2012 issued on the Issue Date.

 

“Initial
Notes” means the Initial Fixed Rate Notes and the Initial Floating Rate
Notes.

 

“Initial
Purchaser” means Wachovia Capital Markets, LLC.

 

“Institutional
Accredited Investors” means institutional accredited investors as defined
in Rule 501(a)(1), (2), (3) or (7) under the Securities Act.

 

“Interest
Swap Obligations” means the obligations of any Person pursuant to any
arrangement with any other Person, whereby, directly or indirectly, such Person
is entitled to receive from time to time periodic payments calculated by
applying either a floating or a fixed rate of interest on a stated notional
amount in exchange for periodic payments made by such other Person calculated
by applying a fixed or a floating rate of interest on the same notional amount
and shall include, without limitation, interest rate swaps, caps, floors,
collars and similar agreements.

 

“Investment”
means, with respect to any Person, any direct or indirect loan or other
extension of credit (including, without limitation, a guarantee) or capital
contribution (excluding accounts receivable, trade credit, commission, travel
and similar advances to officers and employees made in the ordinary course of
business) 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 by such Person of any Capital Stock, bonds, notes,
debentures or other securities or evidences of Indebtedness issued by, any
other Person, in each case to the extent such item is classified as an
investment on the balance sheet of such Person (excluding the footnotes)
prepared in accordance with GAAP. 
“Investment” shall exclude extensions of trade credit by the Company and
by its Restricted Subsidiaries on commercially reasonable terms in accordance
with normal trade practices of the Company or such Restricted Subsidiary, as
the case may be.  If the Company or any
Restricted Subsidiary sells or otherwise disposes of any Common Stock of any
direct or indirect Restricted Subsidiary such that, after giving effect to any
such sale or disposition, it ceases to be a Subsidiary of the Company, the
Company shall be deemed to have made an Investment on the date of any such sale
or disposition equal to the fair market value of the Common Stock of such
Restricted Subsidiary not sold or disposed of.

 

“Issue Date”
means July 5, 2005.

 

“Legal Defeasance”
has the meaning set forth under Section 8.2.

 

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

 

“Management
Agreement” means the management agreement with the Sponsor, its affiliates
or designees as in effect on the Issue Date on the terms described in the Final
Memorandum or pursuant to any amendment, restatement or replacement thereof to
the extent

 

17

 

that the terms of any such amendment, restatement or replacement are
not, taken as a whole, disadvantageous to the Holders in any material respect.

 

“Management Group” means the group consisting of
the directors, executive officers and other management personnel of the Company
or any direct or indirect parent entity of the Company, as the case may be, on
the Issue Date together with (1) any new directors whose election by such
Boards of Directors or whose nomination for election by the shareholders of the
Company or any direct or indirect parent entity of the Company, as applicable,
was approved by a vote of a majority of the directors of the Company or any
direct or indirect parent entity of the Company, as applicable, then still in
office who were either directors on the Issue Date or whose election or
nomination was previously so approved and (2) executive officers and other management
personnel of the Company or any direct or indirect entity of the Company, as
applicable, hired at a time when the directors on the Issue Date together with
the directors so approved constituted a majority of the directors of the
Company or any direct or indirect parent entity of the Company, as applicable.

 

“Moody’s”
means Moody’s Investors Service, Inc.

 

“Net Cash
Proceeds” means, with respect to any Asset Sale, the proceeds in the form
of cash or Cash Equivalents including payments in respect of deferred payment
obligations when received in the form of cash or Cash Equivalents (other than
the portion of any such deferred payment constituting interest) received by the
Company or any of its Restricted Subsidiaries from such Asset Sale net of:

 

(1)           reasonable
out-of-pocket expenses and fees relating to such Asset Sale (including, without
limitation, legal, accounting and investment banking fees, brokerage and sales
commissions, fees and expenses of professional advisors, title and recordation
expenses, and any relocation expenses);

 

(2)           taxes
paid or payable and any Permitted Tax Distributions related to income or gain
from any Asset Sale;

 

(3)           repayment
of Indebtedness that is secured by the assets sold in the relevant Asset Sale
and other Indebtedness that is required to be repaid in connection with such
Asset Sale;

 

(4)           appropriate
amounts to be provided by the Company or any Restricted Subsidiary, as the case
may be, as a reserve, in accordance with GAAP, against any liabilities
associated with such Asset Sale and retained by the Company or any Restricted
Subsidiary, as the case may be, after such Asset Sale, including, without
limitation, pension and other post-employment benefit liabilities, liabilities
related to environmental matters and liabilities under any indemnification
obligations associated with such Asset Sale; and

 

(5)           all
distributions and other payments required to be made to any Person owning a
beneficial interest in assets subject to sale or minority interest holders in
Subsidiaries or joint ventures as a result of such Asset Sale, and any portion
of the purchase price from an Asset Sale placed in escrow (whether as a reserve
for adjustment

 

18

 

of the purchase price, for satisfaction of indemnities in respect of
such Asset Sale or otherwise in connection with such Asset Sale); provided, however,
that upon the termination of such escrow, Net Cash Proceeds will be increased
by any portion of funds therein released to the Company or any Restricted
Subsidiary.

 

“Non-Guarantor Restricted Subsidiary” means any
Restricted Subsidiary which is not a Guarantor and which guarantees
Indebtedness of the Company under any Credit Facility.

 

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

 

“Notes”
means the Fixed Rate Notes and the Floating Rate Notes that are issued under
this Indenture, as amended or supplemented from time to time.  The Fixed Rate Notes and the Floating Rate
Notes are separate series of Notes, but shall be treated as a single class for
all purposes under this Indenture, and, except as otherwise provided in Section
9.2, shall vote and consent together on all matters as one class, including
without limitation, waivers, amendments, redemptions, Change of Control Offers
and Net Proceeds Offers.

 

“Obligations”
means all obligations for principal, premium, interest, penalties, fees,
indemnifications, reimbursements, damages, costs, expenses and other
liabilities payable under the documentation governing any Indebtedness.

 

“Officer”
means (a) with respect to any Person that is a corporation, the Chairman
of the Board, the Chief Executive Officer, the President, the Chief Operating
Officer, the Chief Financial Officer, Chief Accounting Officer, the Treasurer,
the Controller, the Secretary or any Vice President of such Person and
(b) with respect to any other Person, the individuals selected by such
Person to perform functions similar to those of the officers listed in
clause (a).

 

“Officer’s
Certificate” means a certificate signed on behalf of the Company by one
Officer of the Company, who must be either the Chief Executive Officer, the
President, the Chief Financial Officer or the principal accounting officer of
the Company, that meets the requirements of Sections 13.4 and 13.5.  Any such certificate shall comply with the requirements
of the TIA and any other requirements set forth in this Indenture.

 

“Offshore
Certificated Notes” means permanent Certificated Notes in registered form
in substantially the form set forth in Exhibit A, issued pursuant to
Section 2.6 in exchange for interests in the Rule 144A Global Note or the
Regulation S Global Note.

 

“Opinion of
Counsel” means an opinion from legal counsel who is reasonably acceptable
to the Trustee that meets the requirements of Sections 13.4 and 13.5.  Any such opinion shall comply with the
requirements of the TIA and any other requirements set forth in this Indenture.  The counsel may be an employee of or counsel
to the Company or any Subsidiary of the Company.  Opinions of Counsel required to be delivered
under this Indenture may have qualifications and assumptions customary for
opinions of the type required and counsel delivering such Opinions of Counsel
may rely on customary certificates of the Company or government or other
officials for opinions of the type required, including customary certificates
certifying as to matters of fact and that various covenants have been complied
with.

 

19

 

“Partnership Agreement” means the Agreement of Limited
Partnership of CPH I, effective as of May 10, 2005, on the terms described in
the Final Memorandum or pursuant to any amendment, restatement or replacement
thereof to the extent that the terms of any such amendment, restatement or
replacement are not, taken as a whole, disadvantageous to the Holders in any
material respect.

 

“Permitted
Holders” means the Sponsor and the Management Group if at such time the
Management Group owns not more than 15% of the then outstanding total voting
power of the Capital Stock of the Company or any direct or indirect parent
company of the Company.  Any Person or
Persons whose acquisition of beneficial ownership constitutes a Change of Control
in respect of which a Change of Control Offer is made in accordance with the
requirements of this Indenture will thereafter, together with its Affiliates,
constitute an additional Permitted Holder.

 

“Permitted
Indebtedness” means, without duplication, each of the following:

 

(1)           Indebtedness
under the (a) the Floating Rate Notes issued on
the Issue Date and any Guarantees thereof and (b) the Fixed Rate Notes issued
on the Issue Date and any Guarantees thereof;

 

(2)           Indebtedness
incurred pursuant to a Credit Facility in an aggregate principal amount at any
time outstanding not to exceed the greater of (x) $40.0 million (with
letters of credit deemed to have a principal amount equal to the maximum
principal liability thereunder) incurred under this clause (2) or (y) the
sum of (i) 85% of the book value of the accounts receivable plus (ii) 50% of
the book value of inventory of the Company and its Restricted Subsidiaries, in
each case calculated on a consolidated basis and in accordance with GAAP;

 

(3)           other
Indebtedness (including, without limitation, Capitalized Lease Obligation and
industrial revenue bonds) of the Company and its Restricted Subsidiaries outstanding
on the Issue Date;

 

(4)           Purchase
Money Indebtedness and Capitalized Lease Obligations of the Company and its
Restricted Subsidiaries in an aggregate amount for all Indebtedness incurred
pursuant to this clause (4) not to exceed $10.0 million outstanding at any one
time;

 

(5)           Interest
Swap Obligations and Hedging Obligations covering Indebtedness of the Company
or any of its Restricted Subsidiaries outstanding on the Issue Date or
thereafter entered into in the ordinary course of business and not for
speculative purposes;

 

(6)           Indebtedness
under Currency Agreements outstanding on the Issue Date or thereafter entered
into not for speculative purposes; provided that in the case of Currency
Agreements which relate to Indebtedness, such Currency Agreements do not increase
the Indebtedness of the Company and its Restricted Subsidiaries outstanding
other than as a result of fluctuations in foreign currency exchange rates or by
reason of fees, indemnities and compensation payable thereunder;

 

20

 

(7)           Indebtedness
of the Company owed to a Restricted Subsidiary and Indebtedness of any
Restricted Subsidiary owed to the Company or another Restricted Subsidiary for
so long as such Indebtedness is held by the Company or a Restricted Subsidiary;
provided, however, that

 

(a)           if
the Company or a Guarantor is the obligor on such Indebtedness and the obligee
is not the Company or any Guarantor, such Indebtedness shall be expressly
subordinated pursuant to a written agreement to the prior payment in full in
cash or Cash Equivalents of all Obligations on, or relating to, the Notes, in
the case of the Company, or the Guarantee of such Guarantor, in the case of a
Guarantor; and

 

(b)           any
event that results in any such Indebtedness being held by a Person other than
the Company or a Restricted Subsidiary shall constitute the incurrence of
Indebtedness not constituting Permitted Indebtedness by the issuer of such
Indebtedness pursuant to this clause (7);

 

(8)           Indebtedness
in respect of netting services, overdraft protections and otherwise in
connection with deposit accounts and Indebtedness arising from the honoring by
a bank or other financial institution of a check, draft or similar instrument
inadvertently (except in the case of daylight overdrafts) drawn against
insufficient funds in the ordinary course of business; provided, however,
that such Indebtedness is extinguished within five Business Days of incurrence;

 

(9)           Indebtedness
of the Company or any of its Restricted Subsidiaries represented by letters of
credit for the account of the Company or such Restricted Subsidiary, as the
case may be, in order to provide security for workers’ compensation claims, payment
obligations in connection with self-insurance or similar requirements in the
ordinary course of business;

 

(10)         Refinancing
Indebtedness;

 

(11)         Indebtedness
represented by guarantees by the Company or its Restricted Subsidiaries of
Indebtedness otherwise permitted to be incurred under this Indenture; provided
that, in the case of a guarantee by a Restricted Subsidiary, such Restricted Subsidiary
complies with Section 4.16 to the extent applicable;

 

(12)         Indebtedness
of the Company or any of its Restricted Subsidiaries in respect of bid, payment
and performance bonds, bankers’ acceptances, workers’ compensation claims,
unemployment insurance, health, disability and other employee benefits or
property, casualty or liability insurance, surety or appeal bonds or guarantees
and other obligations of a like nature, payment obligations in connection with
self-insurance or similar obligations, bank overdrafts and the financing of
insurance premiums in the ordinary course of business and any letter of credit
issued in connection with the foregoing, and in any such case any reimbursement
obligation in connection therewith;

 

(13)         Indebtedness
arising from agreements of the Company or a Restricted Subsidiary to provide
for indemnification, adjustment of purchase price or similar

 

21

 

obligations, earn-outs or other similar obligations, in each case,
incurred in connection with the acquisition or disposition of any business,
assets or a Subsidiary of the Company, or the assets or Capital Stock of a
Person that is or becomes a Restricted Subsidiary of the Company in accordance
with the terms of this Indenture, other than guarantees of Indebtedness of any
Person acquiring all or any portion of such business, assets or Subsidiary for
the purpose of financing such acquisition;

 

(14)         Indebtedness
to the extent the net proceeds thereof are promptly deposited to defease the
Notes as described in Sections 8.2 and 8.3 or to redeem, satisfy or discharge
the Notes;

 

(15)         the
incurrence by the Company or any of its Restricted Subsidiaries of Indebtedness
to finance, in whole or in part, an acquisition of a business or assets consummated
within 30 days of such incurrence, or Acquired Indebtedness of Persons that are
acquired by the Company or any of its Restricted Subsidiaries in accordance
with the terms of this Indenture; provided that, after giving effect to
such acquisition and the incurrence of such Indebtedness (including any
Acquired Indebtedness), the Company’s Consolidated Fixed Charge Coverage Ratio
would be equal to or greater than immediately prior to such acquisition; and

 

(16)         additional
Indebtedness of the Company and its Restricted Subsidiaries in an aggregate
principal amount not to exceed $20.0 million at any one time outstanding (which
amount may, but need not, be incurred in whole or in part under a Credit
Facility).

 

For purposes
of determining any particular amount of Indebtedness under Section 4.9,
guarantees, Liens or letter of credit obligations supporting Indebtedness
otherwise included in the determination of such particular amount shall not be
included. In the event that an item of Indebtedness meets the criteria of more
than one of the categories of Permitted Indebtedness described in clauses (1)
through (16) above or is permitted to be incurred pursuant to the Coverage
Ratio Exception under Section 4.9, the Company shall, in its sole
discretion, classify (or later reclassify) such item of Indebtedness in any
manner that complies with such covenant. Notwithstanding the foregoing,
Indebtedness under the Credit Agreement outstanding on the Issue Date shall be
deemed to have been incurred pursuant to clause (2) above, and the Company will
not be permitted to reclassify any portion of such Indebtedness
thereafter.  Indebtedness permitted by
Section 4.9 need not be permitted solely by reference to one provision
permitting such Indebtedness but may be permitted in part by one such provision
and in part by one or more other provisions of Section 4.9 permitting such
Indebtedness.  Accrual of interest,
accretion or amortization of original issue discount, the payment of interest
on any Indebtedness in the form of additional Indebtedness with the same terms,
the payment of dividends on Disqualified Capital Stock in the form of
additional shares of the same class of Disqualified Capital Stock, the
classification of preferred stock as Indebtedness under GAAP and change in the
amount outstanding due solely to the result of fluctuations in the exchange
rates of currencies will not be deemed to be an incurrence of Indebtedness for
purposes of Section 4.9.  For purposes of
determining compliance with any dollar-denominated restriction on the
incurrence of Indebtedness denominated in a foreign currency, the
dollar-equivalent principal amount of such Indebtedness incurred pursuant
thereto shall be calculated based on the relevant currency exchange rate in effect
on the date that such Indebtedness was incurred.  The amount of

 

22

 

Indebtedness issued at a price less than the amount of the liability
thereof shall be determined in accordance with GAAP.

 

“Permitted Investments” means:

 

(1)           Investments
by the Company or any Restricted Subsidiary in any Person that is or will
become immediately after such Investment a Restricted Subsidiary or that will
merge or consolidate into the Company or a Restricted Subsidiary;

 

(2)           Investments
in the Company by any Restricted Subsidiary; provided that any
Indebtedness incurred by the Company evidencing such Investment by a Restricted
Subsidiary that is not a Guarantor is unsecured and subordinated, pursuant to a
written agreement, to the Company’s obligations under the Notes and this Indenture;

 

(3)           Investments
in cash and Cash Equivalents;

 

(4)           (i)
loans and advances to directors, employees and officers of the Company and its
Restricted Subsidiaries in the ordinary course of business for bona fide business
(including, without limitation, in connection with the purchase of Capital
Stock by such directors, employees and officers) purposes not in excess of $5.0
million at any one time outstanding and (ii) Investments made in connection
with split-dollar life insurance;

 

(5)           Currency
Agreements, Hedging Obligations and Interest Swap Obligations entered into not
for speculative purposes in the Company’s or a Restricted Subsidiary’s
businesses and otherwise in compliance with this Indenture;

 

(6)           other
Investments, including Investments in Unrestricted Subsidiaries and joint ventures,
not to exceed the greater of (x) $10.0 million and (y) 10.0% of the
Company’s Consolidated Net Tangible Assets at any one time outstanding;

 

(7)           Investments
in securities of trade creditors or members received pursuant to any plan of
reorganization or similar arrangement upon the bankruptcy or insolvency of such
trade creditors or members or in good faith settlement of delinquent
obligations of such trade creditors or members;

 

(8)           Investments
represented by guarantees that are otherwise permitted under this Indenture;

 

(9)           Investments
the payment for which is Qualified Capital Stock of the Company or any direct
or indirect parent entity of the Company;

 

(10)         Investments
made by the Company or its Restricted Subsidiaries as a result of consideration
received in connection with an asset sale made in compliance with
Section 4.10;

 

(11)         receivables
owing to the Company or any Restricted Subsidiary if created or acquired in the
ordinary course of business;

 

23

 

(12)         payroll,
travel, commission 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;

 

(13)         Investments
in prepaid expenses, negotiable instruments held for collection, and lease,
utility, worker’s compensation, performance and other similar deposits provided
to third parties in the ordinary course of business;

 

(14)         Investments
in existence on the Issue Date after giving effect to the Acquisition and an
Investment in any Person to the extent such Investment replaces or refinances
an Investment in such Person existing on the Issue Date in an amount not exceeding
the amount of the Investment being replaced or refinanced; provided, however,
that the new Investment is on terms and conditions no less favorable than the
Investment being renewed or replaced;

 

(15)         any
indemnity, purchase price adjustment, earnout or similar obligation benefiting
the Company or any of its Restricted Subsidiaries created as a result of any acquisition
or disposition of the assets of the Company or the assets or Capital Stock of a
Person that is a Restricted Subsidiary or becomes a Restricted Subsidiary as a
result of such transaction;

 

(16)         Investments
consisting of purchases and acquisitions of inventory, supplies, material or
equipment or the licensing or contribution of intellectual property pursuant to
joint marketing arrangements with other Persons and progress payments made in
respect of capital expenditures;

 

(17)         repurchases
of the Notes;

 

(18)         intercompany
loans, to the extent permitted by Section 4.9;

 

(19)         Investments
acquired in connection with (and not created in anticipation of) an acquisition
otherwise permitted by this Indenture; and

 

(20)         any
transaction to the extent it constitutes an Investment that is permitted and
made in accordance with Section 4.11 (except transactions described in clauses
(5), (13) and (15) of paragraph (b) thereof).

 

“Permitted
Liens” means the following types of Liens:

 

(1)           Liens
existing on the Issue Date (including, without limitation, Liens securing
industrial revenue bonds), to the extent and in the manner such Liens are in
effect on the Issue Date, and any renewal or replacement of such Liens granted
to secure a refinancing of the Indebtedness originally secured by such Lien (so
long as the refinancing is permitted under this Indenture, whether or not the
amount of Indebtedness is increased);

 

(2)           Liens
securing the Notes and Guarantees;

 

24

 

(3)           Liens
securing Indebtedness under a Credit Facility incurred pursuant to clauses (2)
and (16) of the definition of “Permitted Indebtedness”;

 

(4)           Liens
in favor of the Company or any Restricted Subsidiary;

 

(5)           Liens
securing Refinancing Indebtedness; provided that such Liens do not
extend to or cover any property or assets of the Company or any of its
Restricted Subsidiaries not securing the Indebtedness so Refinanced;

 

(6)           Liens
for taxes, assessments or governmental charges or claims either

 

(a)           not
delinquent or

 

(b)           contested
in good faith by appropriate proceedings and as to which the Company or its
Restricted Subsidiaries shall have set aside on its books such reserves as may
be required pursuant to GAAP;

 

(7)           statutory
and contractual Liens of landlords and Liens of carriers, warehousemen,
mechanics, suppliers, materialmen, repairmen and other Liens imposed by law incurred
in the ordinary course of business for sums not yet delinquent or being contested
in good faith, if such reserve or other appropriate provision, if any, as shall
be required by GAAP shall have been made in respect thereof;

 

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

 

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

 

(10)         easements,
rights-of-way, zoning restrictions and other similar charges or encumbrances in
respect of real property not interfering in any material respect with the
ordinary conduct of the business of the Company or of any of its Restricted Subsidiaries;

 

(11)         any
interest or title of a lessor under any Capitalized Lease Obligation; provided
that such Liens do not extend to any property or asset which is not leased property
subject to such Capitalized Lease Obligation;

 

(12)         purchase
money Liens to finance property or assets of the Company or any Restricted
Subsidiary acquired after the Issue Date; provided, however, that

 

(a)           the
related purchase money Indebtedness shall not exceed the cost of such property
or assets and shall not be secured by property or assets of the Company or any
Restricted Subsidiary other than the property and assets so acquired and

 

25

 

(b)           the
Lien securing such Indebtedness shall be created within 180 days of such acquisition;

 

provided,
further, that such
Liens may be extended for improvements to such property;

 

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

 

(14)         Liens
securing reimbursement obligations with respect to commercial letters of credit
which encumber documents and other property relating to such letters of credit
and products and proceeds thereof;

 

(15)         Liens
encumbering deposits made to secure obligations arising from statutory,
regulatory, contractual or warranty requirements of the Company or any of its Restricted
Subsidiaries, including rights of offset and setoff;

 

(16)         Liens
securing Interest Swap Obligations which Interest Swap Obligations relate to
Indebtedness that is otherwise permitted under this Indenture;

 

(17)         Liens
securing Indebtedness under Currency Agreements and Hedging Agreements;

 

(18)         Liens
securing Acquired Indebtedness incurred in accordance with Section 4.9; provided
that

 

(a)           such
Liens secured such Acquired Indebtedness at the time of and prior to the
incurrence of such Acquired Indebtedness by the Company or a Restricted
Subsidiary and were not granted in connection with, or in anticipation of, the
incurrence of such Acquired Indebtedness by the Company or a Restricted
Subsidiary and

 

(b)           such
Liens do not extend to or cover any property or assets of the Company or of any
of its Restricted Subsidiaries other than the property or assets that secured
the Acquired Indebtedness prior to the time such Indebtedness became Acquired
Indebtedness of the Company or a Restricted Subsidiary and are no more favorable
to the lienholders than those securing the Acquired Indebtedness prior to the
incurrence of such Acquired Indebtedness by us or a Restricted Subsidiary;

 

(19)         Liens
on assets of a Non-Guarantor Restricted Subsidiary to secure Indebtedness and
other obligations of such Non-Guarantor Restricted Subsidiary that is otherwise
permitted under this Indenture;

 

(20)         leases,
subleases, licenses and sublicenses or real or personal property or
intellectual property granted to others that do not materially interfere with
the ordinary course of business of the Company and its Restricted Subsidiaries;

 

26

 

(21)         banker’s
Liens, rights of setoff and similar Liens with respect to cash and Cash
Equivalents on deposit in one or more bank accounts in the ordinary course of
business;

 

(22)         Liens
arising from filing Uniform Commercial Code financing statements regarding
leases;

 

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

 

(24)         Liens
in favor or a banking institution arising by operation of law (or pursuant to
the general business practice of a banking institution located outside the
U.S.), encumbering deposits (including the right of setoff) held by such
banking institution incurred in the ordinary course of business and which are
within the general parameters customary in the banking industry.

 

“Permitted Tax Distributions” means

 

(1)           in
the event that the Company is treated as a corporation for applicable federal,
state or local income tax purposes and is a member of a consolidated, combined
or similar U.S. federal, state or local income tax group of which CPH I or
another direct or indirect parent of the Company is the common parent,
payments, dividends or distributions to CPH I, or another direct or indirect
parent of the Company, as the case may be, in order to pay the portion of any
such consolidated, combined or similar income taxes that are attributable to
the income of the Company and its Subsidiaries (to the extent such taxes are
not payable directly by the Company or its Subsidiaries); provided that
the amount of such payments, dividends or distributions, plus the amount of any
such taxes payable directly by the Company and its Subsidiaries, do not exceed
the taxes that the Company and its Subsidiaries would have paid as a
stand-alone group; or

 

(2)           in
the event that the Company is treated as a partnership for applicable U.S.
federal, state or local income tax purposes, aggregate payments, dividends or
distributions to CPH I, or any other direct parent entity of the Company, as
the case may be, in an amount equal to, with respect to any taxable year of the
Company, the product of (x) the highest combined U.S. federal, state (or
provincial) and local statutory tax rate (after taking into account the
deductibility of state (or provincial) and local income tax for Canadian
federal income tax purposes) applicable to any direct (or, where the direct equity
holder is a pass-through entity, indirect) equity holder of the Company, or any
other direct parent entity of the Company, as the case may be, multiplied by
(y) the taxable income of the Company (to the extent such taxes are not
payable directly by the Company or its Subsidiaries).

 

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

 

“PORTAL
Market” means The PORTAL Market operated by the National Association of
Securities Dealers, Inc. or any successor thereto.

 

27

 

“Preferred
Stock” of any Person means any Capital Stock of such Person that has
preferential rights to any other Capital Stock of such Person with respect to
dividends or redemptions or upon liquidation.

 

“Pro Forma Cost Savings” means, with respect to
any period, the reductions in costs that (1) occurred during the Four-Quarter
Period that are directly attributable to an asset acquisition and calculated on
a basis that is consistent with Article 11 of Regulation S-X under the
Securities Act or (2) are implemented, committed to be implemented, the
commencement of implementation of which has begun or reasonably expected to be
implemented in good faith with respect to 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, as if, in the case of each of
clauses (1) and (2), all such reductions in costs had been effected as of the
beginning of such period, decreased by any non-one-time incremental expenses
incurred or to be incurred during the Four-Quarter Period in order to achieve
such reduction in costs.

 

“Purchase
Date” means, with respect to any Note to be repurchased, the date fixed for
such repurchase by or pursuant to this Indenture.

 

“Purchase
Money Indebtedness” means Indebtedness of the Company or its Restricted
Subsidiaries incurred for the purpose of financing all or any part of the
purchase price or the cost of installation, construction or improvement of any
property.

 

“Purchase
Price” means the amount payable for the repurchase of any Note on a Purchase
Date, exclusive of accrued and unpaid interest and Additional Interest (if any)
thereon to the Purchase Date, unless otherwise specifically provided.

 

“QIB”
means a qualified institutional buyer as defined in Rule 144A under the
Securities Act.

 

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

 

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

 

“Redemption
Price” means the amount payable for the redemption of any Note on a
Redemption Date, exclusive of accrued and unpaid interest and Additional
Interest (if any) thereon to the Redemption Date, unless otherwise specifically
provided.

 

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

 

“Refinancing
Indebtedness” means any Refinancing by the Company or any Restricted
Subsidiary of Indebtedness incurred in accordance with the Coverage Ratio
Exception under Section 4.9 or clause (1), (3) or (10) of the definition of “Permitted
Indebtedness” or any Indebtedness issued to so refund or refinance such
Indebtedness, including additional

 

28

 

Indebtedness incurred to pay premiums and fees in connection therewith,
in each case that does not:

 

(1)           result
in an increase in the aggregate principal amount of Indebtedness of such Person
as of the date of such proposed Refinancing (plus the amount of any premium
reasonably required to be paid, plus the amount of reasonable expenses incurred
by the Company or any Restricted Subsidiary in connection with such
Refinancing); or

 

(2)           create
Indebtedness with

 

(a)           a
Weighted Average Life to Maturity that is less than the Weighted Average Life
to Maturity of the Indebtedness being Refinanced or

 

(b)           a
final maturity earlier than the final maturity of the Indebtedness being
Refinanced; provided that

 

(x)            if
such Indebtedness being Refinanced is Indebtedness solely of the Company or a
Guarantor, then such Refinancing Indebtedness shall be Indebtedness solely of
the Company or a Guarantor, and

 

(y)           if
such Indebtedness being Refinanced is subordinate or junior to the Notes, then
such Refinancing Indebtedness shall be subordinate to the Notes at least to the
same extent and in the same manner as the Indebtedness being Refinanced.

 

“Refinancing
Transaction” means the repayment of $215.0 million of indebtedness incurred
by the Company on May 10, 2005 in connection with the Acquisition with the
proceeds from the issuance of the Notes on the Issue Date.

 

“Registration
Rights Agreement” means the Registration Rights Agreement dated as of the
Issue Date among the Company, the Guarantors and the Initial Purchaser.

 

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

 

“Replacement
Assets” means assets of a kind used or usable in the business of the Company
and its Restricted Subsidiaries as conducted on the date of the relevant Asset
Sale or reasonably related or complementary thereto.

 

“Responsible
Officer” shall mean, when used with respect to the Trustee, any officer
within the corporate trust department of the Trustee, including any vice
president, assistant vice president, assistant secretary, assistant treasurer,
trust officer or any other officer of the Trustee who customarily performs
functions similar to those performed by the Persons who at the time shall be
such officers, respectively, or to whom any corporate trust matter is referred
because of such person’s knowledge of and familiarity with the particular
subject and who shall have direct responsibility for the administration of this
Indenture.

 

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

 

29

 

“Restricted
Subsidiary” means any Subsidiary of the Company that has not been designated
by the Board of Directors of the Company, by a Board Resolution of the Company
delivered to the Trustee, as an Unrestricted Subsidiary pursuant to and in
compliance with Section 4.18.  Any
such Designation may be revoked by a Board Resolution of the Company delivered
to the Trustee, subject to the provisions of Section 4.18.

 

“Revocation”
has the meaning set forth under Section 4.18.

 

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

 

“S&P”
means Standard & Poor’s Ratings Service.

 

“Sale and
Leaseback Transaction” means any direct or indirect arrangement with any
Person or to which any such Person is a party, providing for the leasing to the
Company or a Restricted Subsidiary of any property, whether owned by the
Company or any Restricted Subsidiary at the Issue Date or later acquired, which
has been or is to be sold or transferred by the Company or by such Restricted
Subsidiary to such Person or to any other Person from whom funds have been or
are to be advanced by such Person on the security of such Property.

 

“Securities
Act” means the Securities Act of 1933, as amended, or any successor statute
or statutes thereto and the rules and regulations promulgated by the Commission
thereunder.

 

“Significant
Subsidiary” has the meaning set forth in Rule 1-02(w) of Regulation S-X under
the Securities Act, as in effect on the Issue Date.

 

“Sponsor”
means AEA Investors LLC, AEA Management (Cayman) Ltd, AEA Investors LP, and
their respective affiliates and funds managed by any of their managing
directors or senior executives or entities they control.

 

“Stock Purchase Agreement” means the stock
purchase agreement dated as of March 12, 2005, as amended, by and among
Compression Polymers Holdings LLC and Holdings, Vycom Corp., Compression
Polymers Corp. and CPCapitol Acquisition Corp.

 

“Subordinated
Indebtedness” means Indebtedness of the Company or any Guarantor that is by
its express terms subordinated or junior in right of payment to the Notes or
the Guarantee of the Notes of such Guarantor, as the case may be.

 

“Subsidiary”
means, with respect to any Person:

 

(1)           any
corporation of which the outstanding Capital Stock having at least a majority
of the votes entitled to be cast in the election of directors under ordinary circumstances
shall at the time be owned, directly or indirectly, by such Person; or

 

(2)           any
other Person of which at least a majority of the voting interest under ordinary
circumstances is at the time, directly or indirectly, owned by such Person;

 

30

 

provided, in determining the percentage of
ownership interests of any Person controlled by another Person, no ownership
interest in the nature of a “qualifying share” of the former Person shall be
deemed to be outstanding.

 

“Surviving
Entity” has the meaning set forth under Section 5.1.

 

“TIA”
means the Trust Indenture Act of 1939 (15 U.S.C. §§ 77aaa-77bbbb) as
in effect on the date on which this Indenture is qualified under the TIA; provided
that in the event the Trust Indenture Act of 1939 is amended after such date,
“TIA” means, to the extent required by any such amendment, the Trust Indenture
Act of 1939 as so amended.

 

“Transfer
Restricted Security” means a Note that is a restricted security as defined
in Rule 144(a)(3) under the Securities Act.

 

“Trustee”
means the party named as such in the preamble to this Indenture until a
successor replaces it in accordance with the applicable provisions of this
Indenture, and thereafter means the successor serving hereunder.

 

“Unrestricted
Subsidiary” means any Subsidiary of the Company designated as such pursuant
to and in compliance with Section 4.18. 
Any such designation may be revoked by a Board Resolution of the Company
delivered to the Trustee, subject to the provisions of Section 4.18.

 

“U.S.
Certificated Notes” means permanent U.S. Certificated Notes in registered
form in substantially the form set forth in Exhibit A that are offered
and sold to Institutional Accredited Investors.

 

“U.S.
Government Obligations” shall mean securities which are (i) direct
obligations (or certificates representing an ownership interest in such
obligations) of the United States of America for the payment of which its full
faith and credit is pledged or (ii) obligations of a person controlled or
supervised by and acting as an agency or instrumentality of the United States
of America, the payment of which is unconditionally guaranteed or insured as a
full faith and credit obligation by the United States of America, which, in either
case, are not callable or redeemable at the option of the issuer thereof, and
shall also include a depository receipt issued by a bank or trust company as
custodian with respect to any such U.S. Government Obligations or a specific
payment of interest on or principal of any such U.S. Government Obligations
held by such custodian for the account of the holder of a depository receipt; provided
that (except as required by law) such custodian is not authorized to make any
deduction from the amount payable to the holder of such depository receipt from
any amount received by the custodian in respect of the U.S. Government
Obligations or the specific payment of interest on or principal of the U.S.
Government Obligations evidenced by such depository receipt.

 

“U.S. Person”
means any U.S. Person as defined in Regulation S.

 

“Weighted
Average Life to Maturity” means, when applied to any Indebtedness at any
date, the number of years obtained by dividing:

 

(1)           the
then outstanding aggregate principal amount of such Indebtedness into

 

31

 

(2)           the
sum of the total of the products obtained by multiplying

 

(a)           the
amount of each then remaining installment, sinking fund, serial maturity or
other required payment of principal, including payment at final maturity, in
respect thereof, by

 

(b)           the
number of years (calculated to the nearest one-twelfth) which will elapse
between such date and the making of such payment.

 

Section 1.2.                                   Other
Definitions.

 

	
  Term

  	
   

  	
  Defined in Section

  
	
  “Act”

  	
   

  	
  1.5

  
	
  “Agent Members”

  	
   

  	
  2.6(b)

  
	
  “Coverage Ratio Exception”

  	
   

  	
  4.9

  
	
  “EDGAR”

  	
   

  	
  4.3

  
	
  “Event of Default”

  	
   

  	
  6.1

  
	
  “Foreign Person”

  	
   

  	
  2.6(c)

  
	
  “Global Notes”

  	
   

  	
  2.1

  
	
  “Guarantor Surviving Entity”

  	
   

  	
  5.1

  
	
  “incur”

  	
   

  	
  4.9

  
	
  “Net Proceeds Deficiency”

  	
   

  	
  3.10

  
	
  “Net Proceeds Offer”

  	
   

  	
  4.10

  
	
  “Net Proceeds Offer Amount”

  	
   

  	
  4.10

  
	
  “Net Proceeds Offer Trigger Date”

  	
   

  	
  4.10

  
	
  “Optional Redemption”

  	
   

  	
  3.7

  
	
  “Paying Agent”

  	
   

  	
  2.3

  
	
  “Permanent Regulation S Global Note”

  	
   

  	
  2.1

  
	
  “Private Placement Legend”

  	
   

  	
  2.6(h)

  
	
  “Retired Capital Stock”

  	
   

  	
  4.7

  
	
  “Registrar”

  	
   

  	
  2.3

  
	
  “Refunding Capital Stock”

  	
   

  	
  4.7

  
	
  “Regulation S Global Note”

  	
   

  	
  2.1

  
	
  “Restricted Payment”

  	
   

  	
  4.7

  
	
  “Retired Capital Stock”

  	
   

  	
  4.7

  
	
  “Rule 144A Global Note”

  	
   

  	
  2.1

  
	
  “Temporary Regulation S Global Note”

  	
   

  	
  2.1

  

 

Section 1.3.                                   Incorporation
by Reference of Trust Indenture Act.

 

Whenever this
Indenture refers to a provision of the TIA, the provision is incorporated by
reference in and made a part of this Indenture.

 

The following
TIA terms used in this Indenture have the following meanings:

 

“indenture
trustee” means the Trustee; and

 

32

 

“obligor” on
the Notes means the Company and any successor obligor upon the Notes.

 

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

 

Section 1.4.                                   Rules
of Construction.

 

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

 

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

 

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

 

(c)           words
in the singular include the plural, and in the plural include the singular;

 

(d)           references
to sections of or rules under the Securities Act, the Exchange Act and the TIA
shall be deemed to include substitute, replacement and successor sections or
rules adopted by the Commission from time to time;

 

(e)           all
references herein to particular Sections or Articles refer to this Indenture unless
otherwise so indicated;

 

(f)            “including”
means including without limitation; and

 

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

 

Section 1.5.                                   Acts
of Holders.

 

(a)           Any request, demand,
authorization, direction, notice, consent, waiver or other action provided by
this Indenture to be given or taken by Holders may be embodied in and evidenced
by one or more instruments of substantially similar tenor signed by such
Holders in person or by an agent duly appointed in writing; and, except as
herein otherwise expressly provided, such action shall become effective when
such instrument or instruments are delivered to the Trustee and, where it is
hereby expressly required, to the Company. 
Such instrument or instruments (and the action embodied therein and
evidenced thereby) are herein sometimes referred to as the “Act” of
Holders signing such instrument or instruments. 
Proof of execution of any such instrument or of a writing appointing any
such agent shall be sufficient for any purpose of this Indenture and (subject
to Section 7.1) conclusive in favor of the Trustee and the Company, if
made in the manner provided in this Section.

 

33

 

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

 

(c)           The ownership of Notes
shall be proved by the register maintained by the Registrar.

 

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

 

ARTICLE II.

 

THE NOTES

 

Section 2.1.                                   Form
and Dating.

 

The Initial
Notes and the Trustee’s certificate of authentication relating thereto shall be
substantially in the form of Exhibit A and Exhibit B.  The Notes may have notations, legends or
endorsements required by law, stock exchange rule or usage in addition to those
set forth in Exhibit A and Exhibit B.  The Exchange Notes shall be substantially in
the form of Exhibit C and Exhibit D.  Each Note shall be dated the date of its
authentication.  The Notes shall be in
denominations of $1,000 and integral multiples thereof.

 

The terms and
provisions contained in the Notes shall constitute, and are hereby expressly
made, a part of this Indenture and the Company, the Guarantors and the Trustee,
by their execution and delivery of this Indenture, expressly agree to such
terms and provisions and to be bound thereby.

 

Notes offered
and sold in reliance on Rule 144A shall be issued initially in the form of
a single permanent global Note in registered form, substantially in the form
set forth in Exhibit A and Exhibit B (the “Rule 144A
Global Note”), deposited with the Trustee, as custodian for the Depositary,
duly executed by the Company and authenticated by the Trustee as hereinafter
provided and shall bear the Private Placement Legend.  The aggregate principal amount of the
Rule 144A Global Note may from time to time be increased or decreased by
adjustments made on the records of the Trustee, as custodian for the Depositary
or its nominee, as hereinafter provided.

 

Notes offered
and sold in offshore transactions in reliance on Regulation S shall be
issued initially in the form of a single temporary global Note in registered
form, substantially

 

34

 

in the form set forth in Exhibit A and Exhibit B (the “Temporary
Regulation S Global Note”), deposited with the Trustee, as custodian
for the Depositary, duly executed by the Company and authenticated by the
Trustee as hereinafter provided and shall bear the Private Placement Legend and
the Temporary Regulation S Global Note Legend in the form set forth in Exhibit A
and Exhibit B (the “Temporary Regulation S Global Note Legend”).  At any time following 40 days after the
later of the commencement of the offering of the Notes and the Issue Date, upon
receipt by the Trustee and the Company of a duly executed certificate
substantially in the form of Exhibit F(1), a single permanent
Global Note in registered form substantially in the form set forth in Exhibit
A and Exhibit B (the “Permanent Regulation S Global Note”
and, together with the Temporary Regulation S Global Note, the “Regulation S
Global Note”) duly executed by the Company and authenticated by the Trustee
as hereinafter provided shall be deposited with the Trustee, as custodian for
the Depositary, and the Registrar shall reflect on its books and records the
date and a decrease in the principal amount of the Regulation S Global
Note in an amount equal to the principal amount of the beneficial interest in
the Regulation S Global Note transferred.

 

The
Rule 144A Global Note and the Regulation S Global Note are sometimes
referred to herein as the “Global Notes.”

 

Section 2.2.                                   Execution
and Authentication.

 

One Officer of
the Company shall sign the Notes for the Company by manual or facsimile
signature.

 

If an Officer
whose signature is on a Note was an Officer at the time of such execution but
no longer holds that office or position at the time a Note is authenticated,
the Note shall nevertheless be valid. 
This Indenture shall be executed on behalf of each Guarantor listed on
Schedule A hereto.  Any Restricted
Subsidiary that becomes a Guarantor after the date hereof in accordance with
Section 4.16 shall execute a Supplement Indenture in the manner set forth
in Section 11.8.

 

A Note shall
not be valid until authenticated by the manual signature of the Trustee.  The signature shall be conclusive evidence
that the Note has been duly and validly authenticated under this Indenture.

 

The amount of
Notes that can be issued under this Indenture shall be unlimited.

 

The Trustee,
upon a written order of the Company signed by one Officer of the Company shall
authenticate (i) Initial Floating Rate Notes for original issue on the
Issue Date in the aggregate principal amount not to
exceed $65.0 million and Initial Fixed Rate Notes for original issue
on the Issue Date in the aggregate principal amount not to exceed $150.0
million and (ii) subject to Section 4.9, Additional Notes.  The Trustee, upon written order of the
Company signed by one Officer of the Company, together with the other documents
required by Sections 13.4 and 13.5, shall authenticate Exchange Notes; provided
that such Exchange Notes shall be issuable only upon the valid surrender for
cancellation of Initial Notes of a like aggregate principal amount in accordance
with an Exchange Offer or an exchange offer specified in any registration
rights agreement relating to the Additional Notes or to be offered in

 

35

 

connection with any issuance of Additional Notes pursuant to a
registration statement filed pursuant to the Securities Act.  Such written order of the Company shall specify
the amount of Notes to be authenticated and the date on which the original
issue of Notes is to be authenticated.

 

The Trustee
may appoint an authenticating agent acceptable to the Company to authenticate
Notes.  Unless otherwise provided in the
appointment, an authenticating agent may authenticate Notes whenever the
Trustee may do so.  Each reference in
this Indenture to authentication by the Trustee includes authentication by such
agent.  An authenticating agent has the
same rights as an Agent to deal with the Company or with any Affiliate of the
Company.

 

In case the
Company, pursuant to Article V, shall, in one or more related transactions, be
consolidated or merged with or into any other Person or shall sell, assign,
transfer, lease, convey or otherwise dispose of all or substantially all the
assets of the Company and its Restricted Subsidiaries taken as a whole to any
Person, and the Surviving Entity resulting from such consolidation or surviving
such merger, or into which the Company shall have been merged, or the Surviving
Entity which shall have participated in the sale, assignment, transfer,
conveyance or other disposition as aforesaid, shall have assumed all of the
obligations of the Company under the Notes and this Indenture pursuant to agreements
reasonably satisfactory to the Trustee pursuant to Article V, any of the Notes
authenticated or delivered prior to such consolidation, merger, sale,
assignment, transfer, conveyance or other disposition may, from time to time,
at the request of the Surviving Entity, be exchanged for other Notes executed
in the name of the Surviving Entity with such changes in phraseology and form
as may be appropriate, but otherwise in substance of like tenor as the Notes
surrendered for such exchange and of like principal amount; and the Trustee,
upon the request of the Surviving Entity, shall authenticate and deliver Notes
as specified in such request for the purpose of such exchange.  If Notes shall at any time be authenticated
and delivered in any new name of a Surviving Entity pursuant to this Section
2.2 in exchange or substitution for or upon registration of transfer of any
Notes, such Surviving Entity, at the option of the Holders but without expense
to them, shall provide for the exchange of all Notes at the time outstanding
for Notes authenticated and delivered in such new name.

 

Section 2.3.                                   Registrar
and Paying Agent.

 

The Company
shall maintain an office or agency where Notes may be presented or surrendered
for registration of transfer or for exchange (“Registrar”) and an office
or agency where Notes may be presented for payment (“Paying Agent”).  The Registrar shall keep a register of the
Notes and of their transfer and exchange. 
At the option of the Company, payment of interest and Additional
Interest may be made by check mailed to the Holders at their addresses set
forth in the register of Holders; provided that payment by wire transfer
of immediately available funds will be required with respect to principal,
Redemption Price and Purchase Price of, and interest and Additional Interest
(if any) on, all Global Notes and all other Notes the Holders of which shall
have provided wire transfer instructions to the Trustee or the Paying Agent ten
Business Days prior to the Record Date. 
The Company may appoint one or more co-registrars and one or more additional
paying agents.  The term “Registrar”
includes any co-registrar and the term “Paying Agent” includes any additional
paying agent.  The Company may change any
Paying Agent or Registrar without notice to any Holder.  The Company shall promptly notify the Trustee
in writing of the name and address of any Paying Agent not a party

 

36

 

to this Indenture.  If the
Company fails to appoint or maintain another entity as Registrar or Paying
Agent, the Trustee shall act as such. 
The Company may act as Paying Agent or Registrar.  The Depositary shall, by acceptance of a
Global Note, agree that transfers of beneficial interests in such Global Note
may be effected only through a book-entry system maintained by the Depositary
(or its agent), and that ownership of a beneficial interest in the Note shall
be required to be reflected in a book entry.

 

The Company
initially appoints the Trustee to act as the Registrar and Paying Agent and to
act as Note Custodian with respect to the Global Notes, until such time as the
Trustee has resigned or a successor has been appointed.  The Notes may be presented for registration
or transfer and exchange at the offices of the Registrar, which initially will
be the Corporate Trust Office of the Trustee.

 

Section 2.4.                                   Paying
Agents to Hold Money in Trust.

 

The Company
shall require each Paying Agent other than the Trustee to agree in writing that
such the Paying Agent shall hold in trust for the benefit of Holders or the Trustee
all money held by the Paying Agent for the payment of principal and of any
premium, if any, interest and Additional Interest, if any, on the Notes, and
shall promptly notify the Trustee of any default by the Company in making any
such payment.  While any such default
continues, the Trustee may require a Paying Agent to pay all money held by it
to the Trustee.  The Company at any time
may require a Paying Agent to pay all money held by it to the Trustee and
account for any money disbursed.  Upon
payment over to the Trustee, the Paying Agent (if other than the Company) shall
have no further liability for the money. 
If the Company acts as Paying Agent, it shall segregate and hold in a
separate trust fund for the benefit of the Holders all money held by it as
Paying Agent.  Upon any bankruptcy or
reorganization proceedings relating to the Company, the Trustee may serve as
Paying Agent for the Notes.

 

Section 2.5.                                   Holder
Lists.

 

The Trustee
shall preserve in as current a form as is reasonably practicable the most
recent list available to it of the names and addresses of all Holders and shall
otherwise comply with TIA § 312(a).  If
the Trustee is not the Registrar, the Company or the Guarantors shall furnish
or cause the Registrar to furnish to the Trustee 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 the Holders of Notes, and the
Company shall otherwise comply with TIA § 312(a).

 

Section 2.6.                                   Transfer
and Exchange.

 

(a)           Transfer
and Exchange Generally; Book Entry Provisions.  Upon surrender for registration of transfer
of any Note to the Registrar, and satisfaction of the requirements for such
transfer set forth in this Section 2.6, the Company shall execute, and the
Trustee shall authenticate and deliver, in the name of the designated
transferee or transferees, one or more new Notes of any authorized
denominations and of a like aggregate principal amount and bearing such
restrictive legends as may be required by this Indenture.

 

37

 

Notes may be
exchanged for other Notes of any authorized denominations and of a like
aggregate principal amount, upon surrender of the Notes to be exchanged at any
such office or agency maintained by the Company pursuant to
Section 4.2.  Whenever any Notes are
so surrendered for exchange, the Company shall execute, and the Trustee shall
authenticate and deliver, the Notes which the Holder making the exchange is
entitled to receive bearing registration numbers not contemporaneously outstanding.

 

All Notes
presented or surrendered for registration of transfer or exchange shall be duly
endorsed, or be accompanied by a written instrument or instruments of transfer
in form satisfactory to the Company and the Registrar, and the Notes shall be
duly executed by the Holder thereof or his attorney duly authorized in
writing.  Except as otherwise provided in
this Indenture, and in addition to the requirements set forth in the Private
Placement Legend, in connection with any transfer of Transfer Restricted
Securities any request for transfer shall be accompanied by a certification to
the Trustee relating to the manner of such transfer substantially in the form
of Exhibit F(2).

 

(b)           Book-Entry
Provisions for the Global Notes.  The
Rule 144A Global Note and Regulation S Global Note initially shall
(i) be registered in the name of the Depositary or the nominee of such
Depositary, (ii) be delivered to the Trustee as custodian for the
Depositary and (iii) bear legends as set forth in Section 2.6(h).

 

Members of, or
participants in, the Depositary (“Agent Members”) shall have no rights
under this Indenture with respect to any Rule 144A Global Note or Regulation S
Global Note, as the case may be, held on their behalf by the Depositary, or the
Trustee as its custodian, or under the Rule 144A Global Note or
Regulation S Global Note, as the case may be, and the Depositary may be
treated by the Company, the Trustee and any agent of the Company or the Trustee
as the absolute owner of Rule 144A Global Note or Regulation S Global
Note, as the case may be, for all purposes whatsoever.  Notwithstanding the foregoing, nothing herein
shall prevent the Company, the Trustee or any agent of the Company or the
Trustee from giving effect to any written certification, proxy or other
authorization furnished by the Depositary or impair, as between the Depositary
and its Agent Members, the operation of customary practices governing the
exercise of the rights of a holder of any Note.

 

Transfers of
the Rule 144A Global Note and the Regulation S Global Note shall be
limited to transfers of such Rule 144A Global Note or Regulation S
Global Note in whole, but not in part, to the Depositary, its successors or
their respective nominees.  Beneficial
interests in the Rule 144A Global Note and the Regulation S Global
Note may be transferred in accordance with the applicable rules and procedures
of the Depositary and the provisions of this Section 2.6.  The registration of transfer and exchange of
beneficial interests in the Global Note, which does not involve the issuance of
a Certificated Note, shall be effected through the Depositary, in accordance
with this Indenture (including the restrictions on transfer set forth herein)
and the procedures of the Depositary therefor. 
The Trustee shall have no responsibility or liability for any act or
omission of the Depositary.

 

At any time
(i) the Depositary notifies the Company that the Depositary is unwilling or
unable to continue as a Depositary for the Rule 144A Global Note or the
Permanent Regulation S Global Note, as the case may be, or if at any time the
Depositary ceases to be a

 

38

 

“clearing agency” registered under the Exchange Act, and in each case 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 and the
Registrar has received a request from the Depositary or (iii) the Company, in
its sole discretion, notifies the Trustee in writing that it elects to cause
the issuance of Certificated Notes under this Indenture; then, at the request
of the beneficial holder of an interest in the Rule 144A Global Note or
Permanent Regulation S Global Note to obtain a Certificated Note, such
beneficial holder shall be entitled to obtain a Certificated Note upon written
request to the Trustee and the Note Custodian in accordance with the standing instructions
and procedures existing between the Note Custodian and Depositary for the
issuance thereof.  Upon receipt of any
such request, the Trustee, or the Note Custodian at the direction of the
Trustee, will cause, in accordance with the standing instructions and
procedures existing between the Depositary and the Note Custodian, the
aggregate principal amount of the Rule 144A Global Note or Permanent
Regulation S Global Note, as appropriate, to be reduced by the principal
amount of the Certificated Note issued upon such request to such beneficial
holder and, following such reduction, the Company will execute and the Trustee
will authenticate and deliver to such beneficial holder (or its nominee) a
Certificated Note or Certificated Notes in the appropriate aggregate principal
amount in the name of such beneficial holder (or its nominee) and bearing such
restrictive legends as may be required by Section 2.6(h) of this Indenture.

 

(c)           Transfers
to Non-QIB Institutional Accredited Investors.  The following provisions shall apply with
respect to the registration of any proposed transfer of a Transfer Restricted
Security to any Institutional Accredited Investor that is not a QIB (other than
any Person that is not a U.S. Person as defined under Regulation S, a “Foreign
Person”):

 

(i)            the
Registrar shall register the transfer of any Note, whether or not such Note
bears the Private Placement Legend, if (x) (A) the requested transfer
is at least two years after the later of the Issue Date of the Notes and
(B) the proposed transferee has certified to the Registrar that the
requested transfer is at least two years after last date on which such Note was
held by an Affiliate of the Company, or (y) the proposed transferee has delivered
to the Registrar (A) a certificate substantially in the form of Exhibit G
and (B) such certifications, legal opinions and other information as the
Trustee and the Company may reasonably request to confirm that such transaction
is in compliance with the Securities Act; and

 

(ii)           if
the proposed transferor is an Agent Member holding a beneficial interest in the
Global Note, upon receipt by the Registrar of (x) the documents, if any,
required by clause (i) and (y) instructions given in accordance with
the Depositary’s and the Registrar’s procedures, the Registrar shall reflect on
its books and records the date and a decrease in the principal amount of the
Global Note in an amount equal to the principal amount of the beneficial
interest in the Global Note to be transferred, and the Company shall execute,
and the Trustee shall authenticate and deliver, one or more Certificated Notes
of like tenor and amount.

 

(d)           Transfers
to QIBs.  The following provisions
shall apply with respect to the registration of any proposed transfer of a
Transfer Restricted Security to a QIB (other than Foreign Persons):

 

39

 

(i)            if
the Note to be transferred consists of Certificated Notes or an interest in the
Regulation S Global Note, the Registrar shall register the transfer if
such transfer is being made by a proposed transferor who has checked the box
provided for on a certificate substantially in the form of Exhibit F(2)
stating, or has otherwise advised the Company and the Registrar in writing,
that the sale has been made in compliance with the provisions of Rule 144A
to a transferee who is a QIB within the meaning of Rule 144A and is aware
that the sale to it is being made in reliance on Rule 144A; and

 

(ii)           if
the proposed transferee is an Agent Member, and the Note to be transferred
consists of Certificated Notes or an interest in the Regulation S Global
Note, upon receipt by the Registrar of the documents referred to in
clause (i) and instructions given in accordance with the Depositary’s and
the Registrar’s procedures, the Registrar shall reflect on its books and
records the date and an increase in the principal amount of the Rule 144A
Global Note in an amount equal to the principal amount of the Certificated
Notes or the interest in the Regulation S Global Note, as the case may be,
to be transferred, and the Trustee shall cancel the Certificated Notes or
decrease the amount of the Regulation S Global Note so transferred.

 

(e)           Transfers
of Interests in the Temporary Regulation S Global Note.  The following provisions shall apply with
respect to the registration of any proposed transfer of interests in the
Temporary Regulation S Global Note:

 

(i)            the
Registrar shall register the transfer of an interest in the Temporary
Regulation S Global Note if (x) the proposed transferor has delivered
to the Registrar a certificate substantially in the form of Exhibit H
stating, among other things, that the proposed transferee is a Foreign Person
or (y) the proposed transferee is a QIB and the proposed transferor has
checked the box provided for on a certificate substantially in the form of Exhibit F(2)
stating, or has otherwise advised the Company and the Registrar in writing,
that the sale has been made in compliance with the provisions of Rule 144A
to a transferee who is a QIB within the meaning of Rule 144A, and is aware
that the sale to it is being made in reliance on Rule 144A; and

 

(ii)           if
the proposed transferee is an Agent Member, upon receipt by the Registrar of
the documents referred to in clause (i)(y) above and instructions given in
accordance with the Depositary’s and the Registrar’s procedures, the Registrar
shall reflect on its books and records the date and an increase in the
principal amount of the Rule 144A Global Note in an amount equal to the
principal amount of the Temporary Regulation S Global Note to be
transferred, and the Trustee, as Note Custodian, shall decrease the amount of
the Temporary Regulation S Global Note.

 

(f)            Transfers
to Foreign Persons.  The following
provisions shall apply with respect to any transfer of a Transfer Restricted
Security to a Foreign Person:

 

(i)            the
Registrar shall register any proposed transfer of a Note to a Foreign Person
upon receipt of a certificate substantially in the form of Exhibit H
from the proposed transferor and such certifications, legal opinions and other
information as the Trustee or the Company may reasonably request; and

 

40

 

(ii)           (a) if
the proposed transferor is an Agent Member holding a beneficial interest in the
Rule 144A Global Note or the Note to be transferred consists of Certificated
Notes, upon receipt by the Registrar of (x) the documents, if any,
required by paragraph (i) and (y) instructions in accordance with the
Depositary’s and the Registrar’s procedures, the Registrar shall reflect on its
books and records the date and a decrease in the principal amount of the
Rule 144A Global Note in an amount equal to the principal amount of the
beneficial interest in the Rule 144A Global Note or cancel the
Certificated Notes, as the case may be, to be transferred, and (b) if the
proposed transferee is an Agent Member, upon receipt by the Registrar of
instructions given in accordance with the Depositary’s and the Registrar’s
procedures, the Registrar shall reflect on its books and records the date and
an increase in the principal amount of the Regulation S Global Note in an
amount equal to the principal amount of the Certificated Notes to be
transferred, and the Trustee shall decrease the amount of the Rule 144A
Global Note.

 

(g)           The
Depositary.  The Depositary shall be
a clearing agency registered under the Exchange Act.  The Company initially appoints The Depository
Trust Company to act as Depositary with respect to the Global Note.  Initially, the Rule 144A Global Note and
the Regulation S Global Note shall be issued to the Depositary, registered
in the name of Cede & Co., as the nominee of the Depositary, and deposited
with the Note Custodian for Cede & Co.

 

Certificated
Notes issued in exchange for all or a part of a Global Note pursuant to this
Section 2.6 shall be registered in such names and in such authorized
denominations as the Depositary, pursuant to instructions from its direct or
indirect participants or otherwise, shall instruct the Trustee.  Upon execution and authentication, the
Trustee shall deliver such Certificated Notes in certificated form to the
persons in whose names such Certificated Notes are so registered.

 

(h)           Legends.

 

(i)            Except
as permitted by the following paragraphs (ii) and (iii), each Note certificate
evidencing Global Notes and Certificated Notes (and all Notes issued in exchange
therefor or substitution thereof) shall (x) be subject to the restrictions
on transfer set forth in this Section 2.6 (including those set forth in
the legend below) unless such restrictions on transfer shall be waived by
written consent of the Company, and the Holder of each Transfer Restricted
Security, by such Holder’s acceptance thereof, agrees to be bound by all such
restrictions on transfer and (y) bear the legend set forth below (the “Private
Placement Legend”):

 

THIS NOTE (OR ITS PREDECESSOR)
EVIDENCED HEREBY WAS ORIGINALLY ISSUED IN A TRANSACTION EXEMPT FROM REGISTRATION
UNDER SECTION 5 OF THE UNITED STATES SECURITIES ACT OF 1933, AS AMENDED
(THE “SECURITIES ACT”).  THIS NOTE HAS
NOT BEEN REGISTERED UNDER THE SECURITIES ACT, AND ACCORDINGLY, MAY NOT BE
OFFERED, SOLD, PLEDGED OR OTHERWISE TRANSFERRED EXCEPT PURSUANT TO AN EFFECTIVE
REGISTRATION STATEMENT UNDER, OR AN EXEMPTION FROM THE REGISTRATION
REQUIREMENTS OF, THE SECURITIES ACT, IN ACCORDANCE WITH ANY APPLICABLE
SECURITIES LAWS OF ANY

 

41

 

STATE OF THE UNITED STATES OR ANY OTHER
JURISDICTION AND IN ACCORDANCE WITH TRANSFER RESTRICTIONS CONTAINED IN THE INDENTURE
UNDER WHICH THIS NOTE WAS ISSUED AND THE OFFERING MEMORANDUM PURSUANT TO WHICH
THIS NOTE WAS ORIGINALLY SOLD.  THE
HOLDER OF THE NOTE WILL, AND EACH SUBSEQUENT HOLDER IS REQUIRED TO, NOTIFY A
PROPOSED TRANSFEREE OF THE NOTICE OF THE RESALE RESTRICTIONS APPLICABLE TO THE
NOTE.

 

THIS SECURITY MAY NOT BE ACQUIRED
OR HELD WITH THE ASSETS OF (I) AN “EMPLOYEE BENEFIT PLAN” (AS DEFINED IN
THE EMPLOYEE RETIREMENT INCOME SECURITY ACT OF 1974, AS AMENDED (“ERISA”)) THAT
IS SUBJECT TO ERISA, (II) A “PLAN” DESCRIBED IN SECTION 4975 OF THE
INTERNAL REVENUE CODE OF 1986, AS AMENDED (THE “CODE”), (III) ANY ENTITY
DEEMED TO HOLD “PLAN ASSETS” OF ANY OF THE FOREGOING BY REASON OF AN EMPLOYEE
BENEFIT PLAN’S OR PLAN’S INVESTMENT IN SUCH ENTITY, OR (IV) A GOVERNMENTAL
PLAN OR CHURCH PLAN SUBJECT TO APPLICABLE LAW THAT IS SUBSTANTIALLY SIMILAR TO
THE FIDUCIARY RESPONSIBILITY OR PROHIBITED TRANSACTION PROVISIONS OF ERISA OR
SECTION 4975 OF THE CODE (“SIMILAR LAW”), UNLESS THE ACQUISITION AND
HOLDING OF THIS SECURITY BY THE PURCHASER OR TRANSFEREE, THROUGHOUT THE PERIOD
THAT IT HOLDS THIS SECURITY, ARE EXEMPT FROM THE PROHIBITED TRANSACTION
RESTRICTIONS UNDER ERISA AND/OR SECTION 4975 OF THE CODE OR UNDER ANY
PROVISIONS OF SIMILAR LAW, AS APPLICABLE, PURSUANT TO ONE OR MORE PROHIBITED
TRANSACTION STATUTORY OR ADMINISTRATIVE EXEMPTIONS.  BY ITS ACQUISITION OR HOLDING OF THIS
SECURITY, EACH PURCHASER AND TRANSFEREE WILL BE DEEMED TO HAVE REPRESENTED AND
WARRANTED THAT THE FOREGOING REQUIREMENTS HAVE BEEN SATISFIED.

 

(ii)           Upon
any sale or transfer of a Transfer Restricted Security (including any Transfer
Restricted Security represented by a Global Note) pursuant to Rule 144
under the Securities Act or pursuant to an effective registration statement
under the Securities Act:

 

(a)           in
the case of any Transfer Restricted Security that is a Certificated Note, the
Registrar shall permit the Holder thereof to exchange such Transfer Restricted
Security for a Certificated Note that does not bear the legend set forth in
paragraph (i) above and rescind any restriction on the transfer of such
Transfer Restricted Security; and

 

(b)           in
the case of any Transfer Restricted Security represented by a Global Note, such
Transfer Restricted Security shall not be required to bear the legend set forth
in (i) above, but shall continue to be subject to the provisions of
Section 2.6(b); provided, however, that with respect to any
request for an exchange of a Transfer Restricted Security that is represented
by a Global Note for a Certificated Note that does not bear

 

42

 

the legend set forth in paragraph (i) above, which request is made in
reliance upon Rule 144, the Holder thereof shall certify in writing to the
Registrar that such request is being made pursuant to Rule 144 (such
certifications to be substantially in the form of Exhibit F(2)).

 

(iii)          Notwithstanding
the foregoing, upon consummation of an Exchange Offer, the Company shall issue
and, upon receipt of an authentication order in accordance with Section 2.2,
the Trustee shall authenticate Exchange Notes in exchange for Initial Notes
accepted for exchange in such Exchange Offer, which Exchange Notes shall not
bear the legend set forth in (i) above.

 

(iv)          Each
Global Note, whether or not a Transfer Restricted Security, shall also bear the
following legend on the fact thereof:

 

THIS NOTE IS A GLOBAL NOTE WITHIN THE MEANING OF THE INDENTURE
HEREINAFTER REFERRED TO AND IS REGISTERED IN THE NAME OF A DEPOSITARY OR A
NOMINEE OF A DEPOSITARY OR A SUCCESSOR DEPOSITARY.  THIS NOTE IS NOT EXCHANGEABLE FOR NOTES
REGISTERED IN THE NAME OF A PERSON OTHER THAN THE DEPOSITARY OR ITS NOMINEE
EXCEPT IN THE LIMITED CIRCUMSTANCES DESCRIBED IN THE INDENTURE, AND NO TRANSFER
OF THIS NOTE (OTHER THAN A TRANSFER OF THIS NOTE AS A WHOLE BY THE DEPOSITARY
TO A NOMINEE OF THE DEPOSITARY OR BY A NOMINEE OF THE DEPOSITARY TO THE
DEPOSITARY OR ANOTHER NOMINEE OF THE DEPOSITARY) MAY BE REGISTERED EXCEPT IN
THE LIMITED CIRCUMSTANCES DESCRIBED IN THE INDENTURE.

 

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

 

(v)           Any
Global Note may be endorsed with or have incorporated in the text thereof such
legends or recitals or changes not inconsistent with the provisions of this Indenture
as may be required by the Note Custodian, the Depositary or by the National
Association of Securities Dealers, Inc. in order for the Notes to be tradable
on the PORTAL Market or tradable on Euroclear or Clearstream or as may be
required for the Notes to be tradable on any other market developed for trading
of securities pursuant to Rule 144A or Regulation S under the

 

43

 

Securities Act or required to comply with any applicable law or any
regulation thereunder or with the rules and regulations of any securities
exchange or automated quotation system upon which the Notes may be listed or
traded or to conform with any usage with respect thereto, or to indicate any special
limitations or restrictions to which any particular Notes are subject.

 

(i)            Cancellation
and/or Adjustment of Global Notes. 
At such time as all beneficial interests in Global Notes have been
exchanged for Certificated Notes, redeemed, repurchased or canceled, all Global
Notes shall be returned to or retained and canceled by the Trustee in
accordance with Section 2.11.  At
any time prior to such cancellation, if any beneficial interest in a Global
Note is exchanged for Certificated Notes, redeemed, repurchased or canceled,
the principal amount of Notes represented by such Global Notes shall be reduced
accordingly and an endorsement shall be made on such Global Note by the Trustee
or the Note Custodian, at the direction of the Trustee, to reflect such
reduction.  In the event of any transfer
of any beneficial interest between the Rule 144A Global Note and the
Regulation S Global Note in accordance with the standing procedures and
instructions between the Depositary and the Note Custodian and the transfer
restrictions set forth herein, the aggregate principal amount of each of the
Rule 144A Global Note and the Regulation S Global Note shall be
appropriately increased or decreased, as the case may be, and an endorsement
shall be made on each of the Rule 144A Global Note and the
Regulation S Global Note by the Trustee or the Note Custodian, at the direction
of the Trustee, to reflect such reduction or increase.

 

(j)            General
Provisions Relating to Transfers and Exchanges.

 

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

 

(ii)           No
service charge shall be made to a Holder for any registration of transfer, fee
or exchange, but the Company may require payment of a sum sufficient to cover
any transfer tax or similar governmental charge payable in connection therewith
(other than any such transfer taxes or similar governmental charge payable upon
exchange or transfer pursuant to Sections 3.6 and 9.5).

 

(iii)          The
Registrar shall not be required to register the transfer of or exchange any
Note selected for redemption in whole or in part, except the unredeemed portion
of any Note being redeemed in part.

 

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

 

(v)           The
Company shall not be required:

 

(a)           to
issue, to register the transfer of or to exchange Notes during a period
beginning at the opening of business 15 days before the day of mailing of
a notice of

 

44

 

redemption of Notes for redemption under Section 3.2 and ending at
the close of business on the day of such mailing; or

 

(b)           to
register the transfer of or to exchange any Note so selected for redemption in
whole or in part, except the unredeemed portion of any Note being redeemed in
part; or

 

(c)           to
register the transfer of or exchange any Note that has been tendered in a
Change of Control Offer or a Net Proceeds Offer; or

 

(d)           to
register the transfer of or to exchange a Note between a record date and the
next succeeding interest payment date.

 

(vi)          Prior
to due presentment of the registration of a transfer of any Note, the Trustee,
any Agent and the Company may deem and treat the Person in whose name any Note
is registered as the absolute owner of such Note for the purpose of all
payments with respect to such Notes, and neither the Trustee, any Agent nor the
Company shall be affected by notice to the contrary.

 

(vii)         The
Trustee shall authenticate Certificated Notes and Global Notes in accordance
with the provisions of Section 2.2.

 

(viii)        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 Note
(including any transfers between or among Depositary Participants or beneficial
owners of interests in any Certificated Note or Global Note) other than to
require delivery of such certificates and other documentation or evidence as
are expressly required by, and to do so if and when expressly required by the
terms of, this Indenture, and to examine the same to determine substantial
compliance as to form with the express requirements hereof.

 

(ix)           Neither
the Trustee nor any Agent shall have any responsibility for any actions taken
or not taken by the Depositary.

 

Section 2.7.                                   Replacement
Notes.

 

If any
mutilated Note is surrendered to the Trustee or either the Company or the
Trustee receives evidence to its satisfaction of the destruction, loss or theft
of any Note, the Company shall issue and the Trustee, upon receipt of an
authentication order in accordance with Section 2.2, shall authenticate a
replacement Note if the Trustee’s requirements for replacement of Notes are
met.  An indemnity or surety bond must be
supplied by the Holder that is sufficient in the judgment of the Trustee and
the Company to protect the Company, the Trustee, any Agent and any authenticating
agent from any loss that any of them may suffer if a Note is replaced.  The Trustee and the Company each may charge
such Holder for their expenses in replacing such Note including reasonable fees
and expenses of counsel.

 

45

 

Every
replacement Note is an additional obligation of the Company and shall be entitled
to all of the benefits of this Indenture equally and proportionately with all
other Notes duly issued hereunder.

 

Section 2.8.                                   Outstanding
Notes.

 

The Notes
outstanding at any time are all the Notes that have been authenticated by the
Trustee except for those canceled by it, those delivered to it for
cancellation, those reductions in the interest in a Global Note effected by the
Trustee or the Note Custodian in accordance with the provisions hereof, and
those described in this Section as not outstanding.  Except as set forth in Section 2.9, a
Note does not cease to be outstanding because the Company or any of its
Affiliates holds the Note.

 

If a Note is
replaced pursuant to Section 2.7, it shall cease to be outstanding unless
the Trustee and the Company receive proof satisfactory to them that the
replaced Note is held by a bona fide purchaser for value.

 

If the
principal amount of any Note is considered paid under Section 4.1, it
ceases to be outstanding and interest on it ceases to accrue.

 

If the Paying
Agent (other than the Company, a Subsidiary or an Affiliate of any thereof)
holds, on a redemption date or maturity date, money sufficient to pay Notes payable
on that date, then on and after that date such Notes shall be deemed to be no
longer outstanding and shall cease to accrue interest.

 

Notes shall be
deemed to be no longer outstanding and shall cease to accrue interest with
respect to which the Company has effected legal defeasance or covenant
defeasance as provided in Article VIII or which have been discharged in
accordance with Section 12.1.

 

Section 2.9.                                   Treasury
Notes.

 

In determining
whether the Holders of the required principal amount of Notes have concurred in
any direction, waiver or consent, Notes owned by the Company, the Guarantors or
by any Affiliate thereof shall be considered as though not outstanding, except
that for the purposes of determining whether the Trustee shall be protected in
relying on any such direction, waiver of consent, only Notes that a Responsible
Officer of the Trustee actually knows are so owned shall be so disregarded.  The Company agrees to notify the Trustee of
the existence of any such treasury Notes or Notes owned by the Company, any
Guarantor or an Affiliate thereof.

 

Section 2.10.                             Temporary
Notes.

 

Until
Certificated Notes are ready for delivery, the Company may prepare and the
Trustee, upon receipt of an authentication order in accordance with Section 2.2,
shall authenticate and deliver temporary Notes. 
Temporary Notes shall be substantially in the form of Certificated
Notes, but may have such variations as the Company considers appropriate for
temporary Notes and as shall be reasonably acceptable to the Trustee.  Without unreasonable delay, the Company shall
prepare and the Trustee shall, as soon as practicable upon its receipt of

 

46

 

an authentication order, authenticate and deliver Certificated Notes in
exchange for temporary Notes representing an equal principal amount of
Notes.  The Temporary Notes shall be
exchanged for Certificated Notes in accordance with Section 2.6.

 

Until so
exchanged, Holders of temporary Notes shall be entitled to all of the benefits
of this Indenture as a Holder of Certificated Notes.

 

Section 2.11.                             Cancellation.

 

The Company at
any time may deliver Notes to the Trustee for cancellation.  The Registrar and Paying Agent shall forward
to the Trustee any Notes surrendered to them for registration of transfer,
exchange or payment.  The Trustee, or at
the direction of the Trustee, the Registrar or Paying Agent, and no one else,
shall cancel all Notes surrendered for registration of transfer, exchange,
payment, replacement or cancellation and shall dispose of all canceled Notes in
accordance with the Trustee’s usual procedures. 
The Trustee shall maintain a record of all canceled Notes.  The Trustee shall provide the Company a list
of all Notes that have been cancelled from time to time as requested by the
Company.  A copy of all cancelled Notes
shall be delivered to the Company upon written request.  Subject to Section 2.7 the Company may
not issue new Notes to replace Notes that have been paid or that have been
delivered to the Trustee for cancellation which shall not prohibit the Company
from issuing any Additional Notes or any Exchange Notes.

 

Section 2.12.                             Defaulted
Interest.

 

If the Company
defaults in a payment of interest on the Notes, the Company shall pay the
defaulted interest in any lawful manner. 
The Company may pay the defaulted interest to the persons who are
Holders on a subsequent special record date. 
The Company shall fix or cause to be fixed any such special record date
and payment date to the reasonable satisfaction of the Trustee and shall
promptly mail to each Holder, with a copy to the Trustee, a notice that states
the special record date, the payment date and the amount of defaulted interest
to be paid.

 

Section 2.13.                             Persons
Deemed Owners.

 

Prior to due
presentment of a Note for registration of transfer and subject to Section 2.12,
the Company, the Trustee, any Paying Agent, any co-registrar and any Registrar
may deem and treat the person in whose name any Note shall be registered upon
the register of Notes kept by the Registrar as the absolute owner of such Note
(whether or not such Note shall be overdue and notwithstanding any notation of
the ownership or other writing thereon made by anyone other than the Company,
any co-registrar or any Registrar) for the purpose of receiving all payments
with respect to such Note and for all other purposes, and none of the Company,
the Trustee, any Paying Agent, any co-registrar or any Registrar shall be affected
by any notice to the contrary.

 

Section 2.14.                             CUSIP
Numbers, etc.

 

The Company in
issuing the Notes may use “CUSIP” or “ISIN” numbers, and/or other similar
numbers (if then generally in use), and, if so, the Trustee shall use the CUSIP
and/or ISIN numbers in notices of redemption or exchange as a convenience to
Holders;

 

47

 

provided that any such notice may state that
no representation is made as to the correctness or accuracy of the CUSIP number
printed in the notice or on the Notes, and that reliance may be placed only on
the other identification numbers printed on the Notes, and any such redemption
shall not be affected by any defect in or omission of such numbers.  The Company shall notify the Trustee in
writing of any change to the CUSIP numbers.

 

Section 2.15.                             Issuance
of Additional Notes.

 

Subject to
Section 4.9, the Company shall be entitled to issue, from to time, Additional
Notes under this Indenture which shall have identical terms as the Initial
Notes issued on the Issue Date or the Exchange Notes issued therefore (in each
case, other than with respect to the date of issuance, issue price and amount
of interest payable on the first interest payment date applicable thereto), as
the case may be.  Any Additional Notes
shall be part of the same issue as the Notes being issued on the Issue Date and
will vote and consent on all matters as one class with the Notes being issued
on the Issue Date, including, without limitation, waivers, amendments,
redemptions, Change of Control Offers and Net Proceeds Offers.  None of the Initial Notes, any Additional
Notes and the Exchange Notes shall have the right to vote or consent as a
separate class on any matter.  For the
purposes of this Indenture, except for Section 4.9, references to the
Notes include Additional Notes, if any.

 

Notwithstanding
anything else herein, with respect to any Additional Notes issued subsequent to
the date of this Indenture, when the context requires, (1) all references in
this Article II and elsewhere in this Indenture to a Registration Rights
Agreement shall be to the registration rights agreement entered into with
respect to such Additional Notes, (2) any references in this Indenture to the
Exchange Offer, registration statement, Additional Interest, Initial Purchaser,
and any other term related thereto shall be to such terms as they are defined
in such registration rights agreement entered into with respect to such
Additional Notes, (3) all time periods described in the Notes with respect to
the registration of such Additional Notes shall be as provided in such
registration rights agreement entered into with respect to such Additional
Notes, (4) any Additional Interest, if set forth in such registration rights
agreement, may be paid to the holders of the Additional Notes immediately prior
to the making or the consummation of the Exchange Offer regardless of any other
provisions regarding record dates herein and (5) all provisions of this
Indenture shall be construed and interpreted to permit the issuance of such
Additional Notes and to allow such Additional Notes to become fungible and
interchangeable with the Initial Notes originally issued under this Indenture
(and Exchange Notes issued in exchange therefor).

 

ARTICLE III.

 

REDEMPTION AND REPURCHASE

 

Section 3.1.                                   Notices
to Trustee.

 

If the Company
elects to redeem Notes pursuant to the provisions of Section 3.7 or 3.8,
it shall furnish to the Trustee, at least 30 days but not more than
60 days before the Redemption Date (unless a shorter notice period shall
be satisfactory to the Trustee), an Officer’s Certificate setting forth the
Section of this Indenture pursuant to which the redemption shall

 

48

 

occur, the Redemption Date, the principal amount of Notes to be
redeemed and the Redemption Price.

 

If the Registrar
is not the Trustee, the Company shall, concurrently with each notice of
redemption or repurchase, cause the Registrar to deliver to the Trustee a
certificate (upon which the Trustee may rely) setting forth the principal
amounts of Notes held by each Holder.

 

Section 3.2.                                   Selection
of Notes.

 

In the event
that less than all of the Notes are to be redeemed at any time, selection of
such Notes for redemption will be made by the Trustee in compliance with the
requirements of the principal national securities exchange, if any, on which
the Notes are listed or, if the Notes are not then listed on a national
securities exchange, on a pro rata basis, by lot or by such method as the
Trustee shall deem fair and appropriate; provided, however:

 

(1)           that
no Notes of a principal amount of $1,000 or less shall be redeemed in part; and

 

(2)           that
if a partial redemption is made with the proceeds of an Equity Offering,
selection of the Notes or portions thereof for redemption shall be made by the
Trustee only on a pro rata basis or on as nearly a pro rata basis as is
practicable (subject to DTC procedures), unless such method is otherwise
prohibited.

 

Notice of
redemption shall be mailed by first-class mail at least 30 and not more than 60
days before the redemption date to each Holder of Notes to be redeemed at its
registered address.  If any Note is to be
redeemed in part only, the notice of redemption that relates to such Note shall
state the portion of the principal amount thereof to be redeemed.  A new Note in a principal amount equal to the
unredeemed portion thereof will be issued in the name of the Holder thereof
upon cancellation of the original Note. 
On and after the redemption date, interest will cease to accrue on Notes
or portions thereof called for redemption as long as the Company has deposited
with the Paying Agent funds in satisfaction of the applicable redemption price
pursuant to this Indenture.

 

Section 3.3.                                   Notice
of Optional Redemption.

 

In the event
Notes are to be redeemed pursuant to Section 3.7 or 3.8, at least
30 days but not more than 60 days before the Redemption Date, the
Company shall send, by first-class mail, a notice of redemption to each
Holder whose Notes are to be redeemed at its registered address in whole or in
part, with a copy to the Trustee.

 

The notice
shall identify the Notes or portions thereof to be redeemed (including the
CUSIP number, if any) and shall state:

 

(a)           the
Redemption Date;

 

(b)           the
Redemption Price;

 

49

 

(c)           if
any Note is being redeemed in part, the portion of the principal amount of such
Note to be redeemed and that, after the Redemption Date, upon surrender of such
Note, a new Note or Notes in principal amount equal to the unredeemed portion
will be issued;

 

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

 

(e)           that
Notes called for redemption must be surrendered to the Paying Agent to collect
the Redemption Price and Additional Interest, if any, and, unless the Redemption
Date is after a record date and or before the succeeding interest payment date,
accrued interest thereon to the Redemption Date;

 

(f)            that,
unless the Company defaults in making the redemption payment, interest and any
Additional Interest on Notes called for redemption will cease to accrue on and
after the Redemption Date, and the only remaining right of the Holders of such
Notes is to receive payment of the Redemption Price, any Additional Interest
and, unless the Redemption Date is after a record date and on or before the
succeeding interest payment date, accrued interest thereon to the Redemption
Date upon surrender to the Paying Agent of the Notes redeemed;

 

(g)           if
fewer than all the Notes are to be redeemed, the identification of the particular
Notes (or portions thereof) to be redeemed, as well as the aggregate principal
amount of the Notes to be redeemed and the aggregate principal amount of Notes
to be outstanding after such partial redemption;

 

(h)           the
section of this Indenture pursuant to which the Notes called for redemption are
being redeemed; and

 

(i)            that
no representation is made as to the correctness or accuracy of the CUSIP
number, if any, listed in such notice or printed on the Notes and that reliance
may be placed only on the other identification numbers printed on the Notes.

 

At the Company’s
request (which may be revoked at any time prior to the time at which the
Trustee shall have given such notice to the Holders), the Trustee shall give
the notice of redemption in the Company’s name and at its expense; provided
that the Company shall deliver to the Trustee, at least 45 days prior to
the Redemption Date (unless the Trustee shall have agreed to a shorter period),
an Officer’s Certificate requesting that the Trustee give such notice and
setting forth the information to be stated in such notice as provided in the
preceding paragraph.  The notice if
mailed in the manner herein provided shall be conclusively presumed to have
been given, whether or not the Holder receives such notice.  In any case, failure to give such notice by
mail or any defect in the notice to the Holder of any Note designated for
redemption as a whole or in part shall not affect the validity of the
proceedings for the redemption of any other Note.

 

Section 3.4.                                   Effect
of Notice of Redemption.

 

Once notice of
redemption is mailed, Notes or portions thereof called for redemption become
due and payable on the Redemption Date at the Redemption Price.  Upon

 

50

 

surrender to any Paying Agent, such Notes or portions thereof shall be
paid at the Redemption Price, plus Additional Interest, if any, and
accrued interest to the Redemption Date; provided, however, that
if the Redemption Date is after a regular record date and on or prior to the
interest payment date, the accrued interest to the Redemption Date shall be
payable to the Holder of redeemed Notes registered on the relevant record
date.  Failure to give notice or any
defect in the notice to any Holder shall not affect the validity of the notice
to any other Holder.

 

Section 3.5.                                   Deposit
of Redemption Price or Purchase Price.

 

On or before
10:00 a.m. Eastern Time on each Redemption Date or Purchase Date, the Company
shall irrevocably deposit with the Trustee or with the Paying Agent an amount
of money sufficient to pay the aggregate amount due on all Notes to be redeemed
or repurchased on that date, including without limitation any accrued and
unpaid interest and Additional Interest, if any, to the Redemption Date or
Purchase Date.  Upon written request by
the Company, the Trustee or the Paying Agent shall promptly return to the Company
any money not required for that purpose.

 

Unless the
Company defaults in making such payment, interest and any Additional Interest
on the Notes or portions thereof to be redeemed or repurchased will cease to
accrue on the applicable Redemption Date or Purchase Date, whether or not such
Notes are presented for payment.  If any
Note called for redemption shall not be so paid upon surrender because of the
failure of the Company to comply with the preceding paragraph, interest will be
paid on the unpaid principal, from the applicable Redemption Date or Purchase
Date until such principal is paid, and on any interest not paid on such unpaid
principal, in each case at the rate provided in the Notes and in Section 4.1.

 

Section 3.6.                                   Notes
Redeemed or Repurchased in Part.

 

Upon surrender
of a Note that is redeemed or repurchased in part, the Company shall issue and
the Trustee shall, as soon as practicable, authenticate for the Holder at the expense
of the Company a new Note equal in principal amount to portion of the Note
surrendered that is not to be redeemed or repurchased, provided that each new
Note will be in a principal amount of $1,000 or an integral multiple of $1,000
in excess thereof.

 

Section 3.7.                                   Optional
Redemption.

 

The Company
may redeem any or all of the Notes at any time, subject to the conditions and
at the redemption prices set forth in Paragraph 5 of the form of Notes set
forth in Exhibit A, Exhibit B, Exhibit C, and Exhibit D
hereto, which are hereby incorporated by reference and made a part of this
Indenture (an “Optional Redemption”).

 

Any redemption
pursuant to this Section 3.7 shall be made pursuant to the provisions of
Sections 3.1 through 3.6.

 

Section 3.8.                                   Optional
Redemption upon Public Equity Offerings.

 

The Company
may redeem such amount of Notes, using the net cash proceeds of one or more
Equity Offerings, subject to the conditions and at such redemption prices as
set forth

 

51

 

in Paragraph 6 of the form of Notes set forth in Exhibit A, Exhibit
B, Exhibit C, and Exhibit D hereto.

 

Any redemption
pursuant to this Section 3.8 shall be made pursuant to the provisions of
Sections 3.1 through 3.6.

 

Section 3.9.                                   Repurchase
upon Change of Control Offer.

 

In the event
that, pursuant to Section 4.15, the Company shall be required to commence
a Change of Control Offer, it shall follow the procedures specified below.

 

Within
30 days following the date upon which the Change of Control has occurred or,
at the Company’s option, prior to such Change of Control but after it is
publicly announced if a definitive agreement is in place for such Change of
Control at the time of such announcement, the Company must send, by first-class
mail, a notice to each Holder, with a copy to the Trustee.  The notice shall contain all instructions and
materials necessary to enable such Holders to tender Notes pursuant to the
Change of Control Offer.  The Change of
Control Offer shall be made to all Holders. 
The notice, which shall govern the terms of the Change of Control Offer,
shall state:

 

(a)           the
transaction or transactions that constitute the Change of Control, providing
information, to the extent publicly available, regarding the Person or Persons
acquiring control, and stating that the Change of Control Offer is being made
pursuant to this Section 3.9 and Section 4.15 and that, to the extent
lawful, all Notes tendered will be accepted for payment;

 

(b)           the
Purchase Price, the last day of the Change of Control Offer Period and the
Purchase Date, which must be no earlier than 30 days nor later than 60 days
from the date such notice is mailed, other than as may be required by law (the
“Change of Control Payment Date”);

 

(c)           that
any Note not properly tendered or otherwise not accepted for repurchase will
continue to accrue interest and Additional Interest, if any;

 

(d)           that,
unless the Company defaults in the payment of the amount due on the Change of
Control Payment Date, all Notes or portions thereof accepted for repurchase
pursuant to the Change of Control Offer shall cease to accrue interest and
Additional Interest, if any, on and after the Change of Control Payment Date;

 

(e)           that
Holders electing to have any Notes purchased pursuant to the Change of Control
Offer will be required to surrender the Notes, with the form entitled “Option
of Holder to Elect Purchase” on the reverse of the Notes completed, or transfer
by book-entry transfer, to the Company, a Depositary, if appointed by the
Company, or a Paying Agent at the address specified in the notice prior to the
close of business on the third Business Day prior to the Change of Control
Payment Date;

 

(f)            that
Holders will be entitled to withdraw their election if the Company, the
Depositary or the Paying Agent, as the case may be, receives, not later than
two Business

 

52

 

Days prior to the Change of Control Offer
Payment Date, a facsimile transmission or letter setting forth the name of the
Holder, the principal amount of Notes delivered for repurchase, certification
numbers if applicable, and a statement that such Holder is withdrawing his
election to have the Notes redeemed in whole or in part; and

 

(g)           that
Holders whose Notes are being repurchased only in part will be issued new Notes
equal in principal amount to the portion of the Notes tendered (or transferred
by book-entry transfer) that is not to be repurchased, which portion must be
equal to $1,000 in principal amount or an integral multiple thereof.

 

If the notice
is sent prior to the occurrence of the Change of Control, it may be conditioned
upon the consummation of the Change of Control if a definitive agreement is in
place for the Change of Control at the time of the notice of such Change of
Control.

 

On or before
the Change of Control Payment Date, the Company shall to the extent lawful,
(i) accept for payment all Notes or portions thereof properly tendered
pursuant to the Change of Control Offer, (ii) deposit with the Paying
Agent an amount equal to the Purchase Price, together with accrued and unpaid
interest and Additional Interest, if any, thereon to the Change of Control
Payment Date in respect of all Notes or portions thereof so tendered and accepted
for repurchase and (iii) deliver or cause to be delivered to the Trustee
the Notes so accepted together with an Officer’s Certificate stating the
aggregate principal amount of Notes or portions thereof being repurchased by
the Company.  The Paying Agent shall
promptly (but in any case not later than five Business Days after the
Change of Control Payment Date) mail to each Holder of Notes so repurchased the
amount due in connection with such Notes, and the Company shall promptly issue
a new Note, and the Trustee, upon written request from the Company in the form
of an Officer’s Certificate shall authenticate and mail or deliver (or cause to
transfer by book entry) to each relevant Holder a new Note, in a principal
amount equal to any unpurchased portion of the Notes surrendered to the Holder
thereof; provided that each such new Note shall be in a principal amount
of $l,000 or and integral multiple thereof. Thereafter, the Paying Agent shall
return to the Company any cash that remains unclaimed, together with interest,
if any, thereon, held by them for the payment of the Purchase Price.

 

If the Change
of Control Payment Date is on or after an interest record date and on or before
the related interest payment date, any accrued and unpaid interest and Additional
Interest, if any, in each case to the Change of Control Payment Date, shall be
paid to the Person in whose name a Note is registered at the close of business
on such record date, and no additional interest shall be payable to Holders
pursuant to the Change of Control Offer.

 

The Company shall comply with the
requirements of Rule 14e-1 under the Exchange Act and any other securities
laws and regulations thereunder to the extent such laws and regulations are
applicable in connection with the repurchase of Notes pursuant to a Change of
Control Offer.  To the extent that the
provisions of any securities laws or regulations conflict with Section 3.9 or
Section 4.15, the Company shall comply with the applicable securities laws
and regulations and shall not be deemed to have breached its obligations under
this Section 3.9 or Section 4.15 by virtue thereof.

 

53

 

Section 3.10.                             Repurchase
upon Application of Excess Proceeds.

 

In the event that, pursuant to
Section 4.10, the Company shall be required to commence a Net Proceeds
Offer, it shall follow the procedures specified below.

 

Each Net Proceeds Offer will be mailed to the
record Holders as shown on the register of Holders within 30 days
following the Net Proceeds Offer Trigger Date, with a copy to the Trustee.  The notice shall contain all instructions and
materials necessary to enable such Holders to tender Notes pursuant to the Net
Proceeds Offer.  The Net Proceeds Offer
shall be made to all Holders.  Upon
receiving notice of the Net Proceeds Offer, Holders may elect to tender their
Notes in whole or in part in integral multiples of $1,000 in exchange for
cash.  To the extent the aggregate
principal amount of Notes and Pari Passu Indebtedness, if any, validly tendered
and not withdrawn by Holders exceeds the Net Proceeds Offer Amount, Notes and
other Indebtedness, if any, shall be purchased pro rata
based on the aggregate principal amount of tendered Notes and other
Indebtedness, if any.  If any portion of
the Net Proceeds Offer Amount remains after consummation of a Net Proceeds
Offer (such remainder constituting a “Net Proceeds Deficiency”), the
Company and its Restricted Subsidiaries may use the Net Proceeds Deficiency for
any purposes not otherwise prohibited by this Indenture, and the Net Proceeds
Deficiency may be used to make an offer to repurchase Subordinated Indebtedness
required by the terms thereof, and any repurchase of such Indebtedness shall
not be deemed a Restricted Payment, notwithstanding anything else herein to the
contrary.  Upon completion of each Net
Proceeds Offer, the Net Proceeds Offer Amount shall be reset at zero.  A Net Proceeds Offer shall remain open for a
period of 20 Business Days or such longer period as may be required by
law.  The notice, which shall govern the
terms of the Net Proceeds Offer, shall state:

 

(a)           that
the Net Proceeds Offer is being made pursuant to this Section 3.10 and
Section 4.10 and that, to the extent lawful, all Notes tendered will be
accepted for payment;

 

(b)           the
Net Proceeds Offer Amount, the Purchase Price and the Purchase Date (which
Purchase Date shall not be less than 45 nor more than 60 days following the applicable
Net Proceeds Offer Trigger Date);

 

(c)           that
any Note not properly tendered or otherwise not accepted for repurchase shall
remain outstanding and continue to accrue interest and Additional Interest, if
any;

 

(d)           that,
unless the Company defaults in the payment of the amount due on the Purchase
Date, all Notes or portions thereof accepted for repurchase pursuant to the Net
Proceeds Offer shall cease to accrue interest and Additional Interest, if any,
on and after the Purchase Date;

 

(e)           that
Holders electing to have any Notes repurchased pursuant to any Net Proceeds
Offer shall be required to tender the Notes, with the form entitled “Option of
Holder to Elect Purchase” on the reverse of the Notes completed, or transfer by
book-entry transfer, to the Company, a Depositary, if appointed by the Company,
or a Paying

 

54

 

Agent at the address specified in the notice prior to the close of
business on the third Business Day preceding the Purchase Date;

 

(f)            that
Holders will be entitled to withdraw their election if the Company, the
Depositary or the Paying Agent, as the case may be, receives, not later than
two Business Days prior to the Purchase Date, a facsimile transmission or
letter setting forth the name of the Holder, the principal amount of the Notes
delivered for repurchase, certification numbers if applicable, and a statement
that such Holder is withdrawing his election to have such Notes repurchased in
whole or in part;

 

(g)           that,
to the extent Holders properly tender Notes and holders of Indebtedness of the
Company and the Guarantors that ranks pari passu in
right of payment with the Notes or the Guarantees properly tender such
Indebtedness in an amount exceeding the Net Proceeds Offer Amount, the tendered
Notes and such Pari Passu Indebtedness will be purchased on a pro rata basis based on the aggregate principal amounts of
Notes and such Pari Passu Indebtedness tendered (and the Trustee shall select
the tendered Notes of tendering Holders on a pro rata
basis based on the amount of Notes tendered); and

 

(h)           that
Holders whose Notes are being repurchased only in part will be issued new Notes
equal in principal amount to the portion of the Notes tendered (or transferred
by book-entry transfer) that is not to be repurchased, which portion must be
equal to $1,000 in principal amount or an integral multiple thereof.

 

On or before the Purchase Date, the Company
shall to the extent lawful, (i) accept for payment, on a pro rata basis in accordance with this Indenture to the
extent necessary, the Net Proceeds Offer Amount of (A) Notes or portions
thereof properly tendered pursuant to the Net Proceeds Offer and
(B) properly tendered Pari Passu Indebtedness of the Company and the Guarantors,
or if less than the Net Proceeds Offer Amount has been tendered, all Notes and
such other Pari Passu Indebtedness properly tendered, (ii) deposit with
the Paying Agent an amount equal to the Purchase Price, plus accrued and
unpaid interest and Additional Interest, if any, thereon to the Purchase Date
in respect of all Notes or portions thereof so tendered and accepted for repurchase
and (iii) deliver or cause to be delivered to the Trustee the Notes so
accepted together with an Officer’s Certificate stating the aggregate principal
amount of Notes or portions thereof being repurchased by the Company.  The Paying Agent shall promptly (but in any
case not later than five Business Days after the Purchase Date) mail to each
Holder of Notes so repurchased the amount due in connection with such Notes,
and the Company shall promptly issue a new Note, and the Trustee, upon written
request from the Company in the form of an Officer’s Certificate shall authenticate
and mail or deliver such new Note to such Holder, in a principal amount equal
to any unpurchased portion to the Holder thereof; provided that each
such new Note shall be in a principal amount of $1,000 or an integral multiple
thereof. Thereafter, the Paying Agent shall return to the Company any cash that
remains unclaimed, together with interest, if any, thereon, held by them for
the payment of the Purchase Price.

 

If the
Purchase Date is on or after an interest record date and on or before the related
interest payment date, any accrued and unpaid interest and Additional Interest,
if any, in each case to the Purchase Date, shall be paid to the Person in whose
name a Note is registered at

 

55

 

the close of business on such record date, and no additional interest
shall be payable to Holders to the Net Proceeds Offer.

 

The Company
shall comply with the requirements of Rule 14e-1 under the Exchange Act
and any other securities laws and regulations thereunder to the extent such
laws and regulations are applicable in connection with the repurchase of Notes
pursuant to a Net Proceeds Offer.  To the
extent that the provisions of any securities laws or regulations conflict with
this Section 3.10 or Section 4.15, the Company shall comply with the
applicable securities laws and regulations and shall not be deemed to have
breached its obligations under this Section 3.10 or Section 4.15 by virtue
thereof.

 

ARTICLE IV.

 

COVENANTS

 

Section 4.1.                                   Payment
of Principal and Interest.

 

The Company
shall duly and punctually pay or cause to be paid the principal, Redemption
Price or Purchase Price, if applicable, of, and interest on the Notes on the
dates, in the amounts and in the manner provided herein and in the Notes.  Principal, Redemption Price, Purchase Price
and interest shall be considered paid on the date due if the Paying Agent, if
other than the Company (or if the Company or any of its Subsidiaries is the
Paying Agent, the segregated account or separate trust fund maintained by the
Company or such Subsidiary pursuant to Section 2.4)  holds as of 10:00 a.m. Eastern Time on the
due date money deposited by the Company in immediately available funds and designated
for and sufficient to pay the aggregate amount then due.  The Company shall pay Additional Interest, if
any, on the dates of its choosing in the amounts and in the manner set forth in
the Registration Rights Agreement, or any registration rights agreement
relating to Additional Notes, and in the Notes.

 

The Company
shall pay interest (including post-petition interest in any proceeding under
any Bankruptcy Law) on overdue principal, Redemption Price and Purchase Price
at the same rate per annum on the Notes to the extent lawful; it shall pay
interest (including post-petition interest in any proceeding under any
Bankruptcy Law) on overdue installments of interest and Additional Interest
(without regard to any applicable grace period) at the same rate to the extent
lawful.

 

Section 4.2.                                   Maintenance
of Office or Agency.

 

The Company
shall maintain in the Borough of Manhattan, the City of New York, an
office or agency (which may be an office of the Trustee or an affiliate of the
Trustee, Registrar or co-registrar) where Notes may be presented for payment
and surrendered for registration of transfer or for exchange and where notices
and demands to or upon the Company in respect of the Notes and this Indenture
may be served.  The Company shall give
prompt written notice to the Trustee of the location, and any change in the location,
of such office or agency.  If at any time
the Company shall fail to maintain any such required office or agency or shall
fail to furnish the Trustee with the address thereof, such presentations,
surrenders, notices and demands may be made or served at the Corporate Trust
Office of the Trustee.

 

56

 

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

 

The Company
hereby designates the Corporate Trust Office of the Trustee as one such office
or agency of the Company in accordance with Section 2.3.  The Trustee may resign such agency at any
time by giving written notice to the Company no later than 30 days prior
to the effective date of such resignation.

 

Section 4.3.                                   Reports
to Holders.

 

Whether or not
required by the rules and regulations of the Commission, so long as any Notes
are outstanding, the Company will furnish or make available to the Holders of
Notes, with a copy to the Trustee:

 

(1)           beginning
with the report for the quarter ended June 30, 2005, all quarterly and
annual financial information that would be required to be contained in a filing
with the Commission on Forms 10-Q and 10-K if the Company were required to file
such Forms and, with respect to the annual information only, a report thereon
by the Company’s certified independent accountants; and

 

(2)           following
the consummation of an Exchange Offer contemplated by the Registration Rights
Agreement, the information that would be required to be included in all current
reports that would be required to be filed with the Commission on Form 8-K if
the Company were required to file such reports,

 

in each case within the time periods specified
in the Commission’s rules and regulations.

 

In addition,
following the consummation of the Exchange Offer contemplated by the Registration
Rights Agreement, whether or not required by the rules and regulations of the
Commission, the Company will file a copy of all such information and reports
referred to in clauses (1) and (2) above with the Commission for public
availability within the time periods specified in the Commission’s rules and
regulations (unless the Commission will not accept such a filing) and make such
information available to securities analysts and prospective investors upon
request. In addition, the Company has agreed that, for so long as any Notes
remain outstanding, it will furnish to the Holders and to securities analysts
and prospective investors, upon their request, the information required to be delivered
pursuant to Rule 144A(d)(4) under the Securities Act.

 

Notwithstanding
the foregoing, the Company will be deemed to have furnished such reports
referred to in the first paragraph of this Section 4.3 to the Trustee and
the Holders of Notes if the Company has filed such reports with the Commission
via the Commission’s Electronic Data Gathering, Analysis and Retrieval System
(or any successor system) (“EDGAR”) filing system and such reports are
publicly available.

 

57

 

If at any time
the Notes are guaranteed by a direct or indirect parent entity of the Company
and such parent entity has complied with the reporting requirements of Section
13 or 15(d) of the Exchange Act, if applicable, and has furnished the Holders
of Notes, or filed electronically via EDGAR, the reports described herein with
respect to such entity, as applicable (including any financial information
required by Regulation S-X under the Securities Act relating to the Company and
its Subsidiaries), the Company shall be deemed to be in compliance with the
provisions of this Section 4.3.

 

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

 

Section 4.4.                                   Compliance
Certificate.

 

The Company shall
deliver to the Trustee, within 120 days after the end of each fiscal year,
an Officer’s Certificate stating that a review of the activities of the Company
and its Restricted Subsidiaries during the preceding fiscal year has been made
under the supervision of the signing Officer with a view to determining whether
the Company has kept, observed, performed and fulfilled its obligations under
this Indenture in all material respects, and further stating, as to such
Officer signing such certificate, that to the best of his or her knowledge the
Company has kept, observed, performed and fulfilled each and every covenant contained
in this Indenture in all material respects and is not in Default in the
performance or observance of any of the terms, provisions and conditions of
this Indenture (or, if a Default or an Event of Default shall have occurred,
describing all such Defaults or Events of Default of which he or she may have
knowledge), and that to the best of his or her knowledge no event has occurred
and remains in existence by reason of which, payments on account of the principal
of or interest, if any, on the Notes is prohibited or if such event has
occurred, a description of the event.

 

The Company
shall, so long as any of the Notes are outstanding, deliver to a Responsible
Officer of the Trustee, within five Business Days after any Officer of the
Company obtains knowledge of any Default or Event of Default, an Officer’s
Certificate specifying such Default or Event of Default.

 

Section 4.5.                                   Taxes.

 

The Company
shall pay or discharge, and shall cause each of its Restricted Subsidiaries to
pay or discharge, prior to delinquency, all material taxes, assessments, and
governmental levies except such as are contested in good faith and by
appropriate proceedings or where the failure to effect such payment is not
adverse in any material respect to the Holders of the Notes.

 

Notwithstanding
anything to the contrary contained in this Indenture, the Company and its
Restricted Subsidiaries may, to the extent required to do so by law, deduct or
withhold income or other similar taxes imposed by the United States of America
from principal or interest payments under this Indenture.

 

58

 

Section 4.6.                                   Stay,
Extension and Usury Laws.

 

The Company
covenants (to the extent that it may lawfully do so) that it shall not at any
time insist upon, plead, or in any manner whatsoever claim or take the benefit
or advantage of, any stay, extension or usury law wherever enacted, now or at
any time hereafter in force, that may affect the covenants or the performance
of this Indenture; and the Company (to the extent that it may lawfully do so)
hereby expressly waives all benefit or advantage of any such law, and covenants
it shall not, by resort to any such law, 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 such law has not been enacted.

 

Section 4.7.                                   Limitation
on Restricted Payments.

 

The Company
shall not, and shall not cause or permit any of its Restricted Subsidiaries to,
directly or indirectly:

 

(1)           declare
or pay any dividend or make any distribution (other than dividends or
distributions payable in the Qualified Capital Stock, or in warrants, rights or
options to purchase such Qualified Capital Stock (but excluding any debt
security that is convertible into, or exchangeable for, Qualified Capital
Stock), of the Company) on or in respect of shares of the Company’s Capital
Stock to holders of such Capital Stock;

 

(2)           purchase,
redeem or otherwise acquire or retire for value any Capital Stock of the
Company or any warrants, rights or options to purchase or acquire shares of any
class of such Capital Stock;

 

(3)           make
any principal payment on, purchase, defease, redeem, prepay, decrease or
otherwise acquire or retire for value, prior to (a) any scheduled final
maturity, (b) any scheduled or mandatory repayment or (c) any
scheduled sinking fund payment, any Indebtedness of the Company that is subordinate
or junior in right of payment to the Notes (other than the purchase,
defeasance, redemption, prepayment, decrease or other acquisition of
Indebtedness subordinate or junior in right of payment to the Notes 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, defeasance, redemption, prepayment, decrease or other acquisition);
or

 

(4)           make
any Investment (other than Permitted Investments)

 

(each of the
foregoing actions set forth in clauses (1), (2), (3) and (4) (other than
the exceptions set forth therein) being referred to as a “Restricted Payment”);
if at the time of such Restricted Payment or immediately after giving effect
thereto:

 

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

 

(B)           the
Company is not able to incur at least $1.00 of additional Indebtedness pursuant
to the Coverage Ratio Exception; or

 

59

 

(C)           the
aggregate amount of Restricted Payments (including such proposed Restricted
Payment) made subsequent to the Issue Date (the amount expended for such
purposes, if other than in cash, being the fair market value of such property
as determined reasonably and in good faith by the Board of Directors of the
Company) shall exceed the sum of, without duplication:

 

(i)            50%
of the cumulative Consolidated Net Income (or if cumulative Consolidated Net
Income shall be a loss, minus 100% of such loss) of the Company earned during
to the period beginning with the most recently ended fiscal quarter immediately
prior to the Issue Date and ending on or prior to the end of the most recently
ended fiscal quarter for which internal financial statements are available as
of the date the Restricted Payment occurs (treating such period as a single
accounting period); plus

 

(ii)           100%
of the aggregate net proceeds (including the fair market value of property
other than cash) directly or indirectly received by or contributed to, directly
or indirectly, the Company or any Restricted Subsidiary from any Person (other
than a Subsidiary of the Company) from the issuance and sale subsequent to the
Issue Date and on or prior to the date the Restricted Payment occurs of
Qualified Capital Stock of the Company or any direct or indirect parent entity
of the Company, including Qualified Capital Stock issued upon exercise of warrants
or options or upon the merger or consolidation of any Person with the Company
or any Restricted Subsidiary, plus

 

(iii)          the
aggregate amount received by the Company or any Restricted Subsidiary from the
issuance of any Indebtedness or Disqualified Capital Stock of the Company or
any Restricted Subsidiary issued after the Issue Date which has been converted
or exchanged for Qualified Capital Stock in either the Company or any director
or indirect parent entity of the Company, plus

 

(iv)          without
duplication of any amounts included in clause (C)(ii) above, 100% of the
aggregate net proceeds (including the fair market value of property other than
cash) of any equity contribution received by the Company from a direct or
indirect holder of the Company’s Capital Stock subsequent to the Issue Date and
on or prior to the date the Restricted Payment occurs, plus

 

(v)           without
duplication, an amount equal to the sum of

 

(x)            the
net reduction in Restricted Investments resulting from payments of interest on
Indebtedness, dividends, repayments of loans or advances or other transfers of
assets to the Company or any Restricted Subsidiary or the receipt of proceeds
by the Company or any Restricted Subsidiary from the sale or other disposition
of any Restricted Investment, in each case occurring subsequent to the Issue
Date and the return of capital with respect to any Restricted Investment and

 

60

 

(y)           to
the extent that any Subsidiary of the Company that has been designated an
Unrestricted Subsidiary after the Issue Date is redesignated as a Restricted
Subsidiary in accordance with Section 4.18 or merges into a Restricted
Subsidiary or transfers its assets to a Restricted Subsidiary, the fair market
value of the Investment of the Company or any Restricted Subsidiary in such
Subsidiary as of the date of such redesignation, merger or transfer, as the
case may be, plus

 

(vi)          100%
of the aggregate net proceeds (including the fair market value of property) and
any dividends or distributions received by the Company or any Restricted
Subsidiary after the Issue Date from an Unrestricted Subsidiary of the Company
or the proceeds from the sale of stock from an Unrestricted Subsidiary, to the
extent that such dividends, distributions or proceeds were not otherwise included
in the Consolidated Net Income of the Company for such period, plus

 

(vii)         in
the event the Company or any Restricted Subsidiary makes any Investment in a
Person that, as a result of or in connection with such Investment, becomes a
Restricted Subsidiary, an amount equal to the Company’s or any Restricted
Subsidiary’s existing Investment in such Person that was previously treated as
a Restricted Payment pursuant to this clause (C), plus

 

(viii)        any
amount which previously qualified as a Restricted Payment pursuant to this
clause (C) on account of any guarantee entered into by the Company or any
Restricted Subsidiary; provided
that such Guarantee has not been called upon and the obligation arising under
such guarantee no longer exists.

 

Notwithstanding
the foregoing, the provisions set forth in the immediately preceding paragraph
will not prohibit:

 

(1)           the
payment of any dividend or redemption payment within 60 days after the
date of declaration of such dividend or the mailing of such irrevocable
redemption notice if the dividend or redemption payment, as the case may be,
would have been permitted on the date of declaration or the date of mailing of
such notice;

 

(2)           (x) the
acquisition of any shares of Capital Stock (“Retired Capital Stock”) of
the Company, either

 

(a)           solely
in exchange for shares of Qualified Capital Stock of the Company or

 

(b)           through
the application of net proceeds of a substantially concurrent, or within 90
days prior thereto, sale for cash (other than to a Restricted Subsidiary of the
Company) of shares of Qualified Capital Stock of the Company

 

(clauses (a) and (b) collectively, “Refunding Capital Stock”),
and

 

61

 

(y)           the
declaration and payment of dividends on the Retired Capital Stock out of the
proceeds of the substantially concurrent, or within 90 days prior thereto, sale
(other than to a Restricted Subsidiary) of Refunding Capital Stock;

 

(3)           the
acquisition of any Indebtedness of the Company that is subordinate or junior in
right of payment to the Notes either

 

(a)           solely
in exchange for shares of Qualified Capital Stock of the Company, or

 

(b)           through
the application of net proceeds of a substantially concurrent sale for cash
(other than to a Restricted Subsidiary of the Company) of

 

(x)            shares
of Qualified Capital Stock of the Company or

 

(y)           Refinancing
Indebtedness;

 

(4)           if
no Default shall have occurred and be continuing, the purchase, repurchase,
redemption, retirement or other acquisition for value by the Company of Capital
Stock of the Company or options or warrants to purchase Capital Stock of the
Company, stock appreciation rights or any similar equity interest in the
Company and any distribution, loan or advance to any direct or indirect parent
entity of the Company for the purchase, repurchase, redemption, retirement or
other acquisition for value of Capital Stock of any such direct or indirect
parent entity of the Company, in each case, from any current or former
director, officer, employee or consultant of the Company or any of its Subsidiaries
or any direct or indirect parent entity of the Company or its authorized representatives
or permitted transferees upon the death, disability, retirement or termination
of employment of such current or former director, officer, employee or
consultant in an aggregate amount not to exceed $5.0 million in any fiscal year
(and any portion of such $5.0 million not used in any fiscal year may be
carried forward to the next succeeding (but no other) fiscal years); provided, further, that such amount may be increased by an amount
not to exceed

 

(A)          the
cash proceeds from the sale of Capital Stock of the Company and, to the extent
contributed to the Company, Capital Stock of any direct or indirect parent
entity of the Company, in each case to directors, officers, employees or
consultants of the Company or any of its Subsidiaries or any direct or indirect
parent entity of the Company that occurs after the Issue Date (provided
that the amount of such cash proceeds utilized for any such purchase,
repurchase, redemption, retirement or other acquisition will not increase the
amount available for Restricted Payments under clause (C) of this Section 4.7),
plus

 

(B)           the
cash proceeds of key-man life insurance policies received by the Company or any
direct or indirect parent entity of the Company (to the extent contributed to
the Company) or any Restricted Subsidiary after the Issue Date;

 

provided,
further, that the Company may elect to apply all or any portion
of the aggregate increase contemplated by clauses (A) and (B) above in any
fiscal year;

 

62

 

(5)           the
payment by the Company of Permitted Tax Distributions;

 

(6)           (A)          the
declaration and payment of dividends to holders of any class or series of
Designated Preferred Stock (other than Disqualified Capital Stock) issued by
the Company after the Issue Date; or

 

(B)           the
declaration and payment of dividends to a direct or indirect parent entity of
the Company, the proceeds of which will be used to fund the payment of
dividends to holders of any class or series of Designated Preferred Stock
(other than Disqualified Capital Stock) of such parent entity issued after the
Issue Date;

 

provided,
however, that, in each case, (x) after giving effect to the
issuance of such Designated Preferred Stock (and the payment of dividends or
distributions) on a pro forma
basis, the Company would be able to incur at least $1.00 of additional
Indebtedness pursuant to the Coverage Ratio Exception, and (y) the amount of
dividends paid pursuant to this clause (6) shall not exceed the aggregate
amount of cash actually contributed to the common equity capital of the Company
from the sale of such Designated Preferred Stock;

 

(7)           following
the first public offering of the Company’s Common Stock or the Common Stock of
any direct or indirect parent entity of the Company, as the case may be, after
date of the Issue Date, the payment of dividends on the Company’s Common Stock
(or the payment of dividends to any direct or indirect parent entity of the
Company, as the case may be, to fund the payment by such parent entity of
dividends on such entity’s Common Stock) of up to 6% per annum of the gross
proceeds of such public offering received by, and in the case of a public
offering of any direct or indirect parent entity of the Company, contributed to
the common equity capital of, the Company; provided, however,
that the aggregate amount of all such dividends shall not exceed the aggregate
amount of net proceeds received by the Company (or so contributed to Company)
from such public offering;

 

(8)           the
repurchase of Capital Stock of the Company deemed to occur upon (A) the
non-cash exercise of stock options to the extent such Capital Stock represents
a portion of the exercise price of those stock options and (B) the
withholding of a portion of such Capital Stock to pay taxes associated
therewith, and the purchase of fractional shares of Capital Stock of the
Company or any Restricted Subsidiary arising out of stock dividends, splits or
combinations or business combinations;

 

(9)           (A)
the declaration and payment of regularly scheduled or accrued dividends to
holders of any class or series of Disqualified Capital Stock of the Company issued
on or after the Issue Date in accordance with Section 4.9 or (B) the
declaration and payment of dividends to holders of any class or series of
Disqualified Capital Stock of any direct or indirect parent entity of the
Company issued on or after the Issue Date, the proceeds of which have been
contributed to the Company; provided that the amount of dividends paid
pursuant to this clause (9)(B) shall not exceed the aggregate amount of

 

63

 

cash actually contributed to the common equity capital of the Company
from the sale of such Disqualified Capital Stock;

 

(10)         any
payment of dividends, other distributions or other amounts or the making of
loans or advances by the Company to any direct or indirect parent entity of the
Company for the purposes set forth in clauses (A) and (B) below:

 

(A)          to
pay accounting, legal, administrative and other general corporate and overhead
expenses, franchise or similar taxes and other fees required to maintain such
parent entity’s corporate existence and to provide for other operating costs,
including customary salary, bonus and other benefits payable to, and indemnities
provided on behalf of, officers and employees of any such parent entity and to
pay reasonable directors’ fees and to reimburse reasonable out-of-pocket
expenses of the Board of Directors of any direct or indirect parent entity of
the Company, in each case related to the ownership or operation of the Company
or any Restricted Subsidiaries and including to pay fees and expenses, as
incurred, of an offering of such parent entity’s securities or indebtedness
that is not consummated, or of a registered public offering or of an
acquisition which is not consummated, in each case where the proceeds of such
offering or such acquisition, as the case may be, was intended to be
contributed to or combined with Company or its Restricted Subsidiaries; and

 

(B)           to
pay the Sponsor those amounts payable pursuant to the Management Agreement;

 

(11)         any
repurchase, redemption, retirement or other acquisition for value of Disqualified
Capital Stock of the Company made by exchange for or out of proceeds of a
substantially concurrent sale of Disqualified Capital Stock that is permitted
to be incurred pursuant to Section 4.9; provided that any new
Disqualified Capital Stock has an aggregate liquidation preference that does
not exceed the aggregate liquidation preference of the amount so refinanced;

 

(12)         the
repurchase of any Subordinated Indebtedness of the Company in the event of a
Change of Control or Asset Sale pursuant to a provision similar to the provisions
in Section 4.10; provided that prior to consummating any such repurchase, the
Company has made the Change of Control Offer or Net Proceeds Offer, as the case
may be, required by this Indenture and has repurchased all Notes validly
tendered for payment in connection with such Change of Control Offer or Net
Proceeds Offer, as the case may be;

 

(13)         any
payment to the sellers of the purchase price for the Acquisition, as well as
all fees and expenses related thereto, including, without limitation, the
payment of fees and expenses to the Sponsor on May 10, 2005 in connection with
the Acquisition and the Credit Agreement, fees and expenses related to the
Refinancing Transaction, and any payments to any direct or indirect parent
entity of the Company in order for any such parent entity to make such payments
or distributions; and

 

64

 

(14)         if
no Default shall have occurred and be continuing, Restricted Payments in an
aggregate amount since the Issue Date not to exceed $10.0 million.

 

In determining
the aggregate amount of Restricted Payments made subsequent to the Issue Date
in accordance with clause (C) of the second preceding paragraph, amounts expended
pursuant to clauses (1), (2)(b), (3)(b)(x) and (7) of the immediately preceding
paragraph shall be included in such calculation.

 

For purposes
of determining compliance with this covenant, in the event that a Restricted
Payment permitted pursuant to this Section 4.7 or a Permitted Investment meets
the criteria of more than one of the categories of Restricted Payment described
in clauses (1) through (14) above or one or more clauses of the definition of
Permitted Investments, the Company shall be permitted to classify such
Restricted Payment or Permitted Investment on the date it is made, or later
reclassify all or a portion of such Restricted Payment or Permitted Investment,
in any manner that complies with this Section 4.7, and such Restricted Payment
or Permitted Investment shall be treated as having been made pursuant to only
one of such clauses of this Section 4.7 or of the definition of Permitted
Investments.

 

Section 4.8.                                   Limitation
on Dividend and Other Payment Restrictions Affecting Subsidiaries.

 

The Company
shall not, and shall not cause or permit any of its Restricted Subsidiaries to,
directly or indirectly, create or otherwise cause or permit to become effective
any consensual encumbrance or restriction on the ability of any Restricted Subsidiary
to:

 

(1)           pay
dividends or make any other distributions on or in respect of its Capital
Stock;

 

(2)           make
loans or advances or pay any Indebtedness or other obligation owed to the
Company or any other Restricted Subsidiary; or

 

(3)           transfer
any of its property or assets to the Company or any other Restricted
Subsidiary,

 

except in each
case for such encumbrances or restrictions existing under or by reason of:

 

(a)           applicable
law, rule, regulation or order, including of any regulatory body;

 

(b)           this
Indenture, the Notes and the Guarantees;

 

(c)           customary
provisions restricting assignments or subletting in (x) any lease
governing a leasehold interest of any Restricted Subsidiary or (y) any
contracts and licenses (including, without limitation, those relating to
intellectual property), in each case entered into in the ordinary course of
business;

 

(d)           any
instrument governing Acquired Indebtedness or Capital Stock of a Person
acquired by the Company or any of its Restricted Subsidiaries, which encumbrance
or restriction was in existence at the time of such acquisition (but not

 

65

 

created in contemplation thereof or to provide all or any portion of
the funds or credit support utilized to consummate such acquisition) and is not
applicable to any Person, or the properties or assets of any Person, other than
the Person or the properties or assets of the Person so acquired (including,
but not limited to, such Person’s direct and indirect Subsidiaries);

 

(e)           agreements
existing on the Issue Date (other than the Credit Agreement) to the extent and
in the manner such agreements are in effect on the Issue Date;

 

(f)            the
Credit Agreement or an agreement governing any other Indebtedness of the
Company or any Restricted Subsidiary permitted to be incurred under this Indenture;
provided that, with respect to any agreement governing such other
Indebtedness, the provisions relating to such encumbrance or restriction are no
less favorable to the Company in any material respect, taken as a whole, than
the provisions contained in the Credit Agreement as in effect on the Issue
Date;

 

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

 

(h)           restrictions
imposed by any agreement to sell assets or Capital Stock permitted under this
Indenture to any Person pending the closing of such sale;

 

(i)            Purchase
Money Indebtedness or Capitalized Lease Obligations that impose restrictions on
the property purchased or leased of the nature described in clause (3) of
the preceding paragraph of this Section 4.8;

 

(j)            provisions
in joint venture agreements, partnership agreements, limited liability company
organizational governance documents, asset sale and stock sale agreements, sale-leaseback
agreements, stock sale agreements and other similar agreements that restrict
the transfer of ownership interests in such entity;

 

(k)           customary
restrictions on real property interests set forth in easements and similar
arrangements of the Company or any Restricted Subsidiary;

 

(l)            restrictions
on cash or other deposits or net worth imposed by customers or suppliers under
contracts entered into in the ordinary course of business;

 

(m)          encumbrances
pursuant to the subordination provisions of any Indebtedness permitted to be
incurred by clause (7) of the definition of “Permitted Indebtedness”;

 

(n)           encumbrances
on the assets or capital stock of Foreign Subsidiaries pursuant to Indebtedness
of Foreign Subsidiaries permitted to be incurred under this Indenture that are
not expected to make the Company unable to make principal or interest payments
on the Notes, as determined in good faith by the Company; and

 

(o)           an
agreement governing Indebtedness incurred to Refinance the Indebtedness issued,
assumed or incurred pursuant to an agreement referred to in clauses

 

66

 

(b) and (d) through (f) above and any amendments, restatements,
modifications, renewals, supplements, refundings, replacements or refinancings
of the contracts, instruments or obligations referred to in clauses (a)
through (n) above; provided, however, that the provisions
relating to such encumbrance or restriction contained in any such Indebtedness,
and amendments, restatements, modifications, renewals, supplements, refundings,
replacements or refinancings are no less favorable to the Company in any
material respect as determined by the Board of Directors of the Company in its
reasonable and good faith judgment than the provisions relating to such
encumbrance or restriction contained in agreements prior to such amendment,
restatement, modification, renewal, supplement, refunding, replacement or
refinancing.

 

Section 4.9.                                   Limitation
on Incurrence of Additional Indebtedness.

 

The Company
shall not, and shall not permit any of its Restricted Subsidiaries to, directly
or indirectly, create, incur, issue, assume, guarantee, acquire, become liable,
contingently or otherwise, with respect to, or otherwise become responsible for
payment of (collectively, “incur”) any Indebtedness other than Permitted
Indebtedness; provided, however, that the Company or any
Restricted Subsidiary that is, or concurrently with such incurrence becomes, a
Guarantor may incur Indebtedness (including Acquired Indebtedness), in each
case if on the date of the incurrence of such Indebtedness, after giving effect
to the incurrence thereof and the receipt and application of the proceeds
thereof, the Consolidated Fixed Charge Coverage Ratio of the Company is greater
than 2.0 to 1.0.  The foregoing proviso
is referred to as the “Coverage Ratio Exception.”

 

Section 4.10.                             Limitation
on Asset Sales.

 

The Company
shall not, and shall not permit any of its Restricted Subsidiaries to, consummate
an Asset Sale unless:

 

(1)           the
Company or the applicable Restricted Subsidiary, as the case may be, receives
consideration at the time of such Asset Sale at least equal to the fair market
value of the assets sold or otherwise disposed of (as determined in good faith
by the Board of Directors of the Company); and

 

(2)           at
least 75% of the consideration received by the Company or the applicable
Restricted Subsidiary, as the case may be, from such Asset Sale shall be in the
form of cash or Cash Equivalents and shall be received at the time of such
disposition; provided, however, that the amount of (a) any liabilities (as
shown on the Company’s or such Restricted Subsidiary’s most recent balance
sheet or the notes thereto) of the Company or any Restricted Subsidiary (other
than liabilities that are by their terms subordinated to the Notes) that are
assumed by the transferee in such Asset Sale and from which the Company or such
Restricted Subsidiary is released (including by operation of law), (b) any
notes, securities or other obligations received by the Company or by any such Restricted
Subsidiary from such transferee that are converted, sold or exchanged by the
Company or by such Restricted Subsidiary into cash or Cash Equivalents within
180 days of receipt by the Company or such Restricted Subsidiary (to the
extent of the cash or Cash Equivalents received) and (c) any Designated
Non-cash Consideration

 

67

 

received by the Company or any Restricted Subsidiary in such Asset Sale
having an aggregate fair market value, taken together with all other Designated
Non-cash Consideration received pursuant to this clause (c) that is at
that time outstanding, not to exceed the greater of (x) $5.0 million and
(y) 5% of Consolidated Net Tangible Assets of the Company at the time of
the receipt of such Designated Non-cash Consideration, with the fair market
value of each item of Designated Non-cash Consideration being measured at the
time received and without giving effect to subsequent changes in value, shall
be deemed to be cash for purposes of this provision.

 

Upon the
consummation of an Asset Sale, the Company shall apply, or cause the applicable
Restricted Subsidiary to apply, the Net Cash Proceeds relating to such Asset
Sale within 365 days of receipt thereof either:

 

(1)           to
(i) permanently reduce obligations under a Credit Facility (and, except in the
case of revolving credit facilities, to correspondingly reduce commitments with
respect thereto), or (ii) permanently reduce Indebtedness of a Restricted
Subsidiary that is not a Guarantor,

 

(2)           to
make an investment in Replacement Assets,

 

(3)           to
make capital expenditures in properties and assets that will be used in the
business of the Company and its Restricted Subsidiaries or in businesses
reasonably related or complementary thereto (“Permitted Business”),

 

(4)           acquire
Capital Stock of a Person that is a Restricted Subsidiary or of a Person
engaged in a Permitted Business that shall become a Restricted Subsidiary immediately
upon consummation of such acquisition, including by means of a merger, consolidation
or other business combination permitted under this Indenture,

 

(5)           to
repay obligations under Pari Passu Indebtedness, provided that if the Company shall so reduce obligations
under such Pari Passu Indebtedness, it shall equally and ratably reduce
obligations under the Notes if the Notes are then prepayable or, if the Notes
may not then be prepaid, the Company shall make an offer (in accordance with
the procedures set forth below for a Net Proceeds Offer) to all Holders of
Notes to purchase the Notes at 100% of the principal amount thereof, plus the
amount of accrued but unpaid interest, if any, on the amount of Notes that
would otherwise be prepaid, or

 

(6)           a
combination of prepayment and investment permitted by the foregoing clauses (1)
through (5).

 

The Company or
such Restricted Subsidiary will be deemed to have complied with its obligations
under the preceding paragraphs of this Section 4.10 if it enters into a binding
commitment to acquire such properties, assets or Capital Stock prior to 365
days after the receipt of the applicable Net Cash Proceeds, provided
that upon any abandonment or termination of such binding commitment, the Net
Available Proceeds not so applied shall constitute Net Cash Proceeds and be
applied as set forth below.

 

68

 

On the 366th
day after an Asset Sale or such earlier date, if any, as the Board of Directors
of the Company or of such Restricted Subsidiary determines not to apply the Net
Cash Proceeds relating to such Asset Sale as set forth in the preceding
paragraph (each, a “Net Proceeds Offer Trigger Date”), such aggregate
amount of Net Cash Proceeds that have not been applied on or before such Net
Proceeds Offer Trigger Date as permitted in the preceding paragraph (each a “Net
Proceeds Offer Amount”) shall be applied by the Company or such Restricted
Subsidiary to make an offer to purchase (the “Net Proceeds Offer”) on a
date not less than 45 nor more than 60 days following the applicable Net
Proceeds Offer Trigger Date, the maximum principal amount of Notes and other
Indebtedness (“Pari Passu Indebtedness”) of the Company and the
Guarantors that ranks pari passu in
right of payment with the Notes or the Guarantees, as the case may be (to the
extent required by the instrument governing such other Indebtedness), that may
be purchased out of the Net Proceeds Offer Amount.  Any Notes and other Indebtedness to be purchased
pursuant to a Net Proceeds Offer shall be purchased pro rata
based on the aggregate principal amount of Notes and such other Indebtedness outstanding
and all Notes shall be purchased at an offer price in cash in an amount equal
to 100% of the principal amount thereof, plus accrued and unpaid interest to
the date of purchase.  The Net Proceeds
Offer shall be made in compliance with the applicable procedures set forth in
Section 3.10 and shall include all instructions and materials necessary to
enable Holders to tender their Notes.

 

The Company
may defer the Net Proceeds Offer until there is an aggregate unutilized Net
Proceeds Offer Amount equal to or in excess of $15.0 million resulting from one
or more Asset Sales (at which time, the entire unutilized Net Proceeds Offer
Amount, and not just the amount in excess of $15.0 million, shall be applied as
required pursuant to this Section 4.10).

 

In the event
of the transfer of substantially all (but not all) of the property and assets
of the Company and its Restricted Subsidiaries as an entirety to a Person in a
transaction permitted under Section 5.1, the successor corporation shall be
deemed to have sold the properties and assets of the Company and its Restricted
Subsidiaries not so transferred for purposes of this Section 4.10, and shall
comply with the provisions of this Section 4.10 with respect to such deemed
sale as if it were an Asset Sale.  In
addition, the fair market value of such properties and assets of the Company or
its Restricted Subsidiaries deemed to be sold pursuant to the preceding sentence
shall be deemed to be Net Cash Proceeds for purposes of this Section 4.10.

 

Notwithstanding
the preceding paragraphs of this Section 4.10, the Company and its
Restricted Subsidiaries will be permitted to consummate an Asset Sale without
complying with such paragraphs to the extent:

 

(1)           at
least 75% of the consideration for such Asset Sale constitutes Replacement
Assets; and

 

(2)           the
Company or the applicable Restricted Subsidiary, as the case may be, receives
consideration at the time of such Asset Sale at least equal to the fair market
value of the assets sold or otherwise disposed of (as determined in good faith
by the Board of Directors of the Company);

 

69

 

provided that any consideration not
constituting Replacement Assets received by the Company or any of its
Restricted Subsidiaries in connection with any Asset Sale permitted to be consummated
under this paragraph shall constitute Net Cash Proceeds subject to the provisions
of the preceding paragraphs of this Section 4.10.

 

Section 4.11.                             Limitations
on Transactions with Affiliates.

 

(a)           The
Company shall not, and shall not permit any of its Restricted Subsidiaries to,
directly or indirectly, enter into or permit to exist any transaction or series
of related transactions (including, without limitation, the purchase, sale,
lease or exchange of any property or the rendering of any service) involving
aggregate consideration in excess of $2.5 million with, or for the benefit of,
any of its Affiliates (each, an “Affiliate Transaction”), other than:

 

(1)           Affiliate
Transactions permitted under paragraph (b) below; and

 

(2)           Affiliate
Transactions on terms that are no less favorable than those that might
reasonably have been obtained in a comparable transaction at such time on an
arm’s-length basis from a Person that is not an Affiliate of the Company or
such Restricted Subsidiary.

 

All Affiliate
Transactions (and each series of related Affiliate Transactions which are
similar or part of a common plan) involving aggregate payments or other
property with a fair market value in excess of $10.0 million will be approved
by the Board of Directors of the Company, such approval to be evidenced by a
Board Resolution stating that the Board of Directors has determined that such
transaction complies with the foregoing provisions.  If the Company or any Restricted Subsidiary
enters into an Affiliate Transaction (or a series of related Affiliate
Transactions related to a common plan) that involves an aggregate fair market
value of more than $20.0 million, the Company will, prior to the consummation
thereof, obtain an opinion from an Independent Financial Advisor stating that
such transaction or series of related transactions are fair to the Company or
to the relevant Restricted Subsidiary, as the case may be, from a financial
point of view.

 

(b)           The
restrictions set forth in Section 4.11(a) shall not apply to:

 

(1)           reasonable
fees and compensation paid to and indemnity provided on behalf of the Company’s
officers, directors, employees or consultants or those of any Restricted Subsidiary
as determined in good faith by the Company’s Board of Directors;

 

(2)           transactions
exclusively between or among the Company and any of its Restricted Subsidiaries
or exclusively between or among such Restricted Subsidiaries (including any
Person that becomes a Restricted Subsidiary as a result of any such transaction);
provided that such transactions are not otherwise prohibited by this Indenture;

 

(3)           amounts
payable to the Sponsor pursuant to the Management Agreement as in effect on the
Issue Date, which shall be no more than $1.5 million per year;

 

70

 

(4)           any
agreement or instrument as in effect as of the Issue Date or any amendment or
replacement thereof or any transaction contemplated thereby (including pursuant
to any amendment or replacement thereof) so long as any such amendment or
replacement agreement or instrument is, in the good faith judgment of the Board
of Directors of the Company, not more disadvantageous to the Holders of Notes,
taken as a whole, than the original agreement or instrument as in effect on the
Issue Date;

 

(5)           Restricted
Payments and Permitted Investments permitted by this Indenture;

 

(6)           any
employment or compensation arrangement or agreement, employee benefit plan or
arrangement, officer or director indemnification agreement or any similar
arrangement or other compensation arrangement entered into by the Company or
any of its Restricted Subsidiaries in the ordinary course of business and
payments, issuance of securities or awards pursuant thereto;

 

(7)           any
issuance of Qualified Capital Stock to Affiliates;

 

(8)           contracts
or agreements with, and payments by the Company or any of its Restricted
Subsidiaries to, Sponsor in connection with any financial advisory, consulting,
financing, underwriting or placement services or any other investment banking,
banking or similar services, including, without limitation, in connection with acquisitions
or divestitures, which payments are (x) made pursuant to the agreements with
Sponsor in effect on the Issue Date, or (y) approved by a majority of the
Board of Directors of the Company in good faith;

 

(9)           the
grant of stock options, restricted stock, stock appreciation rights, phantom
stock awards or similar rights in each case to employees, directors and
consultants approved by the Board of Directors;

 

(10)         any
redemption of Capital Stock held by current or former employees, directors or
consultants at the time of their death, disability, termination of employment
or departure from the Board of Directors for not in excess of fair market value
or as otherwise contractually required;

 

(11)         any
merger, consolidation or reorganization of the Company with an Affiliate of the
Company solely for the purposes of (i) reorganizing to facilitate an initial
public offering of securities of the Company or any direct or indirect parent
entity of the Company or (ii) reincorporating the Company in a new jurisdiction;

 

(12)         transactions
pursuant to any registration rights agreement with the stockholders of the
Company or any direct or indirect parent entity of the Company, on customary
terms;

 

(13)         transactions
pursuant to or contemplated by the Partnership Agreement as in effect on the
Issue Date;

 

71

 

(14)         transactions
and payments of fees and expenses to the Sponsor on May 10, 2005 in connection
with the Acquisition and the Credit Agreement;

 

(15)         agreements
and transactions with customers, clients, suppliers or purchasers and sellers
of goods or services, in each case in the ordinary course of business and
otherwise in compliance with this Indenture, which are fair to the Company or
its Restricted Subsidiaries, or are on terms, taken as a whole, at least as
favorable as might reasonably have been obtained at that time from a Person who
is not an Affiliate of the Company; and

 

(16)         ordinary
course transactions (including the payment of customary fees and expenses) with
investment banks, commercial banks and other financial institutions in
connection with investment banking, commercial banking and other financial
advisory services.

 

Section 4.12.                             Limitation on Liens.

 

The Company
shall not, and shall not cause or permit any of its Restricted Subsidiaries to,
directly or indirectly, create, incur or assume any Liens securing any
Indebtedness upon any property or assets of the Company or any of its
Restricted Subsidiaries whether owned on the Issue Date or acquired after the
Issue Date, or any proceeds therefrom, or assign or otherwise convey any right
to receive income or profits therefrom (other than Permitted Liens) unless effective
provision for securing the Notes or, with respect to Liens on any Guarantor’s
property or assets, the Guarantee of such Guarantor, and:

 

(1)           if
such Lien secures Indebtedness which is subordinate in right of payment to the
Notes or any Guarantee of any Guarantor, as the case may be, any such Lien
shall be subordinate to the Lien granted to Holders to the same extent as such
Indebtedness is subordinate in right of payment to the applicable Notes or the
related Guarantee of such Guarantor, as the case may be; and

 

(2)           in
all other cases, the Notes or any related Guarantees, as the case may be, are secured
on at least an equal and ratable basis.

 

Notwithstanding
the foregoing, any Lien securing the Notes or a Guarantee granted pursuant to
this Section 4.12 shall be automatically and unconditionally released and discharged
upon (a) the release by the holders of the Indebtedness described above of
their Lien on the property or assets of the Company or any Restricted
Subsidiary (including any deemed release upon payment of obligations under such
Indebtedness), at such time as the holders of all such Indebtedness also
release their Lien on the property or assets of the Company or such Restricted
Subsidiary, (b) any sale, exchange or transfer to any Person other than
the Company or any Restricted Subsidiary of the property or assets secured by
such Lien, or of all of the Capital Stock held by the Company or any Restricted
Subsidiary in, or all or substantially all the assets of, any Restricted
Subsidiary creating such Lien in accordance with the terms of this Indenture,
(c) in the case of a Lien on assets of a Guarantor securing a Guarantee,
upon the release of such Guarantee in accordance with the terms of this
Indenture, (d) payment in full of

 

72

 

the principal of, and accrued interest and premium on, the Notes, or
(e) a defeasance or discharge of the Notes in accordance with the
procedures pursuant to Section 8.2, 8.3 or 12.1.

 

Section 4.13.                             Continued
Existence.

 

Subject to
Article V, each of the Company and the Guarantors shall do or cause to be
done all things reasonably necessary to preserve and keep in full force and
effect (i) its corporate or other existence in accordance with the
organizational documents (as the same may be amended from time to time) of the
Company or any such Guarantor and (ii) the material rights (charter and
statutory), licenses and franchises of the Company or such Guarantor, except to
the extent that the applicable Board of Directors determines that the
preservation of such right, license or franchise, or the existence of any such
Guarantor, in either case is no longer necessary or desirable in the conduct of
the business of the Company or such Guarantor and that the loss thereof is not
disadvantageous in any material respect to the Holders.

 

Section 4.14.                             [Reserved].

 

Section 4.15.                             Offer
to Repurchase upon Change of Control.

 

Upon the
occurrence of a Change of Control, each Holder will have the right to require
that the Company purchase all or a portion (equal to $1,000 or an integral
multiple thereof) of such Holder’s Notes (a “Change of Control Offer”)
at a Purchase Price equal to 101% of the principal amount thereof, plus accrued
and unpaid interest and Additional Interest, if any, thereon to the Change of
Control Payment Date in accordance with Section 3.9.

 

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

 

Section 4.16.                             Future
Subsidiary Guarantees.

 

If any
Restricted Subsidiary of the Company (other than any Non-Guarantor Restricted
Subsidiary if the fair market value of such Non-Guarantor Restricted
Subsidiary, together with the fair market value of all other Non-Guarantor
Restricted Subsidiaries, as of such date, does not exceed in the aggregate
$3.5 million) guarantees any of the Company’s Indebtedness under any
Credit Facility, then such Restricted Subsidiary shall:

 

(1)           execute
and deliver to the Trustee a supplemental indenture substantially in form of
Exhibit E pursuant to which such Restricted Subsidiary shall unconditionally
guarantee all of the Company’s obligations under the Notes and this Indenture
on the terms set forth in this Indenture; and

 

(2)           deliver
to the Trustee an Opinion of Counsel to the effect that such supplemental
indenture has been duly authorized, executed and delivered by such Restricted
Subsidiary and constitutes a legal, valid, binding and enforceable obligation
of such Subsidiary.

 

73

 

Thereafter,
such Subsidiary shall be a Guarantor for all purposes of this Indenture; provided,
however, that to the extent that a Subsidiary is subject to any
instrument governing Acquired Indebtedness, as in effect at the time of
acquisition thereof, that prohibits such Subsidiary from issuing a Guarantee,
such Subsidiary shall not be required to execute such a supplemental indenture
until it is permitted to issue such Guarantee pursuant to the terms of such
Acquired Indebtedness.

 

In addition,
to the extent the collective fair market value of the Non-Guarantor Restricted Subsidiaries,
as of the date of the creation of, acquisition of or Investment in a Non-Guarantor
Restricted Subsidiary, exceeds $3.5 million, the Company shall cause one
or more of such Non-Guarantor Restricted Subsidiaries to execute and deliver to
the Trustee a supplemental indenture substantially in form of Exhibit E
pursuant to which such Subsidiary shall unconditionally guarantee all of the
Company’s obligations under the Notes and this Indenture on the terms set forth
in this Indenture, such that the collective fair market value of all remaining
Non-Guarantor Restricted Subsidiaries does not exceed $3.5 million.

 

Section 4.17.                              [Reserved].

 

Section 4.18.                             Limitation
on Designations of Unrestricted Subsidiaries.

 

The Company
may designate any Subsidiary of the Company (other than a Subsidiary of the
Company that owns Capital Stock of a Restricted Subsidiary) as an “Unrestricted
Subsidiary” under this Indenture (a “Designation”) only if:

 

(1)           no
Default shall have occurred and be continuing at the time of or after giving effect
to such Designation; and

 

(2)           the
Company would be permitted under this Indenture to make an Investment at the
time of Designation (assuming the effectiveness of such Designation) in an
amount (the “Designation Amount”) equal to the sum of:

 

(a)           the
fair market value of the Capital Stock of such Subsidiary owned by the Company
and its Restricted Subsidiaries on such date; and

 

(b)           the
aggregate amount of other Investments of the Company and its Restricted
Subsidiaries in such Subsidiary on such date; and

 

(3)           the
Company would be permitted to incur $1.00 of additional Indebtedness pursuant
to the Coverage Ratio Exception at the time of Designation (assuming the
effectiveness of such Designation).

 

In the event
of any such Designation, the Company shall be deemed to have made an Investment
constituting a Restricted Payment pursuant to Section 4.7 for all purposes
of this Indenture in the Designation Amount.

 

The Company
shall not, and shall not permit any Restricted Subsidiary to, at any time:

 

74

 

(1)           provide
direct or indirect credit support for or a guarantee of any Indebtedness of any
Unrestricted Subsidiary (including of any undertaking, agreement or instrument
evidencing such Indebtedness); or

 

(2)           be
directly or indirectly liable for any Indebtedness of any Unrestricted Subsidiary.

 

The Company
may revoke any Designation of a Subsidiary as an Unrestricted Subsidiary (a “Revocation”),
whereupon such Subsidiary shall then constitute a Restricted Subsidiary, if:

 

(1)           no
Default shall have occurred and be continuing at the time of and after giving
effect to such Revocation; and

 

(2)           all
Liens and Indebtedness of such Unrestricted Subsidiary outstanding immediately
following such Revocation would, if incurred at such time, have been permitted
to be incurred for all purposes of this Indenture.

 

All
Designations and Revocations must be evidenced by Board Resolutions of the
Company certifying compliance with the foregoing provisions.

 

ARTICLE V.

 

SUCCESSORS

 

Section 5.1.                                   Merger,
Consolidation and Sale of Assets.

 

The Company
shall not, in a single transaction or series of related transactions,
consolidate or merge with or into any Person, or sell, assign, transfer, lease,
convey or otherwise dispose of (or cause or permit any Restricted Subsidiary to
sell, assign, transfer, lease, convey or otherwise dispose of) all or
substantially all of the Company’s assets (determined on a consolidated basis
for the Company and its Restricted Subsidiaries) whether as an entirety or
substantially as an entirety to any Person, unless:

 

(1)           either:

 

(a)           the
Company will be the surviving or continuing entity; or

 

(b)           the
Person (if other than the Company) formed by such consolidation or into which
the Company is merged or the Person which acquires by sale, assignment,
transfer, lease, conveyance or other disposition of properties and assets of
the Company and of its Restricted Subsidiaries substantially as an entirety
(the “Surviving Entity”):

 

(x)            will
be an entity organized and validly existing under the laws of the United States
or any State thereof or the District of Columbia; and

 

75

 

(y)           will
expressly assume, by supplemental indenture (in form and substance satisfactory
to the Trustee), executed and delivered to the Trustee, the due and punctual
payment of the principal of, and premium, if any, and interest on all of the
Notes and the performance of every covenant of the Notes, this Indenture and
the Registration Rights Agreement on the part of the Company to be performed or
observed;

 

(2)           immediately
after giving effect to such transaction and the assumption contemplated by
clause (1)(b)(y) above (including giving effect to any Indebtedness and
Acquired Indebtedness incurred or anticipated to be incurred in connection with
or in respect of such transaction), the Company or such Surviving Entity, as
the case may be, shall be able to incur at least $1.00 of additional
Indebtedness (other than Permitted Indebtedness) pursuant to the Coverage Ratio
Exception;

 

(3)           immediately
before and immediately after giving effect to such transaction and the
assumption contemplated by clause (1)(b)(y) above (including, without
limitation, giving effect to any Indebtedness and Acquired Indebtedness incurred
or anticipated to be incurred and any Lien granted in connection with or in
respect of the transaction), no Default shall have occurred or be continuing;
and

 

(4)           the
Company or the Surviving Entity shall have delivered to the Trustee an Officer’s
Certificate and an Opinion of Counsel, each stating that such consolidation,
merger, sale, assignment, transfer, lease, conveyance or other disposition and,
if a supplemental indenture is required in connection with such transaction,
such supplemental indenture complies with the applicable provisions of this
Indenture and an Officer’s Certificate that all conditions precedent in this
Indenture relating to such transaction have been satisfied.

 

For purposes
of the foregoing, the transfer (by lease, assignment, sale or otherwise, in a
single transaction or series of transactions) of all or substantially all of
the properties or assets of one or more Restricted Subsidiaries, the Capital
Stock of which constitutes all or substantially all of the properties and
assets of the Company, will be deemed to be the transfer of all or
substantially all of the properties and assets of the Company.

 

Notwithstanding
the foregoing clauses (1), (2), (3) and (4), the Company may merge with an
Affiliate that is a Person that has no material assets or liabilities and which
was organized solely for the purpose of reorganizing the Company in another
jurisdiction and/or for the purpose of forming a holding company.

 

Upon any
consolidation, combination or merger or any transfer of all or substantially
all of the assets of the Company in accordance with the foregoing in which the
Company is not the continuing corporation, the Surviving Entity shall succeed
to, and be substituted for, and may exercise every right and power of, the
Company under this Indenture and the Notes with the same effect as if such
Surviving Entity had been named as such and the Company will be discharged from
all obligations and covenants under this Indenture and the Notes.

 

76

 

Each Guarantor, if any (other than any
Guarantor whose Guarantee is to be released in accordance with the terms of the
Guarantee and this Indenture in connection with any transaction complying with
the provisions of Section 4.10), shall not, and the Company shall not
cause or permit any Guarantor to, consolidate with or merge with or into any
Person other than the Company or any other Guarantor unless:

 

(1)           the
entity formed by or surviving any such consolidation or merger (if other than
the Guarantor) (the “Guarantor Surviving Entity”) is an entity organized
and existing under the laws of the United States or any State thereof or the
District of Columbia;

 

(2)           such
Guarantor Surviving Entity assumes by supplemental indenture all of the
obligations of the Guarantor on the Guarantee; and

 

(3)           immediately
after giving effect to such transaction, no Default or Event of Default shall
have occurred and be continuing.

 

Any merger or
consolidation of a Guarantor with and into the Company (with the Company being
the surviving entity) or another Guarantor that is a Restricted Subsidiary of
the Company need not comply with this Section 5.1.  Notwithstanding the foregoing clauses (1),
(2) and (3), any Guarantor may merge with an Affiliate that is a Person that
has no material assets or liabilities and which was organized solely for the
purpose of reorganizing the Guarantor in another jurisdiction, and the
Guarantors may merge with an Affiliate as part of any internal reorganization.

 

Upon any consolidation
or merger in accordance with the foregoing in which such Guarantor is not the
continuing corporation, the Guarantor Surviving Entity shall succeed to, and be
substituted for, such Guarantor under this Indenture and such Guarantor’s
Guarantee with the same effect as if such Guarantor Surviving Entity had been
named as such, and such Guarantor will be discharged from all obligations and
covenants under this Indenture and its Guarantee.

 

ARTICLE VI.

 

DEFAULTS AND REMEDIES

 

Section 6.1.                                   Events
of Default.

 

Each of the
following constitutes an “Event of Default”:

 

(a)           the
failure to pay interest on any Note when the same becomes due and payable and
the default continues for a period of 30 days;

 

(b)           the
failure to pay the principal on any Note, when such principal becomes due and
payable, at maturity, upon redemption or otherwise (including the failure to
make a payment to purchase Notes tendered pursuant to a Change of Control Offer
or a Net Proceeds Offer) on the date specified for such payment in the
applicable offer to purchase;

 

77

 

(c)           a
default in the observance or performance of any other covenant or agreement
contained herein which default continues for a period of 60 days after the
Company receives written notice specifying the default (and demanding that such
default be remedied) from the Trustee or the Holders of at least 25% of the outstanding
principal amount of the Notes (except in the case of a default with respect to
Section 5.1, which will constitute an Event of Default with such notice
requirement but without such passage of time requirement);

 

(d)           the
failure to pay at final maturity (giving effect to any applicable grace periods
and any extensions thereof) the principal amount of any Indebtedness of the
Company or any Restricted Subsidiary, or the acceleration of the final stated
maturity of any such Indebtedness, if the aggregate principal amount of such
Indebtedness, together with the principal amount of any other such Indebtedness
in default for failure to pay principal at final stated maturity or which has
been accelerated, aggregates $15.0 million or more at any time;

 

(e)           one
or more judgments in an aggregate amount in excess of $15.0 million (to the
extent not covered by insurance or bonded) shall have been rendered against the
Company or any of its Significant Subsidiaries and such judgments remain
undischarged, unpaid or unstayed for a period of 60 days after such
judgment or judgments become final and nonappealable;

 

(f)            the
Company or any Significant Subsidiary of the Company:

 

(i)            commences
a voluntary case under any Bankruptcy Law,

 

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

 

(iii)          consents
to the appointment of a custodian or receiver of it or for all or
substantially, all of its property, or

 

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

 

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

 

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

 

(ii)           appoints
a custodian or receiver of the Company or any Significant Subsidiary or for all
or substantially all of the property of any of the foregoing, or

 

(iii)          orders
the liquidation of the Company or any of its Significant Subsidiaries,

 

78

 

and the order
or decree remains unstayed and in effect for 60 consecutive days; or

 

(h)           any
Guarantee of Holdings or a Significant Subsidiary required pursuant to this
Indenture ceases to be in full force and effect or is declared to be null and
void and unenforceable or is found to be invalid or any Guarantor that is a
Significant Subsidiary denies its liability in writing under its Guarantee
required pursuant to this Indenture (other than by reason of release of a
Guarantor in accordance with the terms of this Indenture).

 

Section 6.2.                                   Acceleration.

 

If an Event of
Default (other than an Event of Default specified in Section 6.1(f) or (g)
with respect to the Company) shall occur and be continuing, the Trustee or the
Holders of at least 25% in principal amount of outstanding Notes may declare
the principal of and accrued interest on all the Notes to be due and payable by
notice in writing to the Company and the Trustee specifying the respective
Event of Default and that it is a “notice of acceleration” and the same shall
become immediately due and payable.  If
an Event of Default specified in Section 6.1(f) or (g) with respect to the
Company occurs and is continuing, then all unpaid principal of, and premium, if
any, and accrued and unpaid interest on all of the outstanding Notes shall ipso facto become and be immediately due and payable without
any declaration or other act on the part of the Trustee or any Holder.

 

Notwithstanding
the preceding paragraph, in the event of any Event of Default specified in
Section 6.1(d), such Event of Default and all consequences thereof (excluding
any resulting payment default) shall be annulled, waived and rescinded,
automatically and without any action by the Trustee or the Holders, if within
45 days after such Event of Default arose,

 

(1)           the
Indebtedness or guarantee that is the basis for such Event of Default has been
discharged;

 

(2)           the
holders thereof have rescinded or waived the acceleration, notice or action (as
the case may be) giving rise to such Event of Default; or

 

(3)           if
the default that is the basis for such Event of Default has been cured.

 

The Holders of
not less than a majority in principal amount of the Notes by written notice to
the Company and the Trustee may, on behalf of the Holders of all of the Notes,
rescind and cancel such declaration and its consequences:

 

(1)           if
the rescission would not conflict with any judgment or decree;

 

(2)           if
all existing Events of Default have been cured or waived except nonpayment of
principal or interest that has become due solely because of the acceleration;

 

(3)           to
the extent the payment of such interest is lawful, if interest on overdue
installments of interest and overdue principal that has become due otherwise
than by such declaration of acceleration has been paid;

 

79

 

(4)           if
the Company has paid the Trustee its reasonable compensation and reimbursed the
Trustee for its expenses, disbursements and advances; and

 

(5)           in
the event of the cure or waiver of an Event of Default of the type described in
Section 6.1(f) or (g), the Trustee shall have received an Officer’s
Certificate and an Opinion of Counsel stating that such Event of Default has
been cured or waived.

 

No such
rescission shall affect any subsequent Default or impair any right consequent
thereto.

 

Section 6.3.                                   Other
Remedies.

 

If an Event of
Default occurs and is continuing, the Trustee may pursue any available remedy
to collect the payment of principal, premium, if any, interest or Additional
Interest, if any, on the Notes or to enforce the performance of any provision
of the Notes or this Indenture.

 

The Trustee
may maintain a proceeding even if it does not possess any of the Notes or does
not produce any of them in the proceeding, and any recovery or judgment shall,
after provision for the payment of the reasonable compensation, expenses,
disbursements and advances of the Trustee, its agents and counsel, be for the
ratable benefit of the Holders of the Notes. 
A delay or omission by the Trustee or any Holder in exercising any right
or remedy accruing upon an Event of Default shall not impair the right or
remedy or constitute a waiver of or acquiescence in the Event of Default.  All remedies are cumulative to the extent
permitted by law.

 

Section 6.4.                                   Waiver
of Existing Defaults.

 

The Holders of
a majority in aggregate principal amount of the then outstanding Notes may by
notice to the Trustee on behalf of the Holders of all of the Notes, waive any existing
Default under this Indenture, and its consequences, except a default in the
payment of the principal of or interest or Additional Interest, if any, on any
Notes.  Upon any such waiver, such Default
shall cease to exist, and any Event of Default arising therefrom shall be
deemed to have been cured for every purpose of this Indenture; but no such
waiver shall extend to any subsequent or other Default or impair any right consequent
thereon.

 

Section 6.5.                                   Control
by Majority.

 

Holders of a
majority in aggregate principal amount of the then outstanding Notes may direct
the time, method and place of conducting any proceeding for exercising any
remedy available to the Trustee or exercising any trust or power conferred on
the Trustee.  Subject to Sections 7.1 and
7.2, however, the Trustee may refuse to follow any direction that conflicts
with applicable law or this Indenture or that the Trustee reasonably determines
may be unduly prejudicial to the rights of other Holders of Notes or that may
result in the incurrence of liability by the Trustee and shall be entitled to
the benefit of Sections 7.1(c)(iii) and (e), provided, however,
that subject to the provisions of Section 315 of the TIA, the Trustee may take any
other action deemed proper by the Trustee that is not inconsistent with such
direction.

 

80

 

Section 6.6.                                   Limitation on Suits.

 

A Holder of a
Note may pursue a remedy with respect to this Indenture or the Notes only if:

 

(a)           an
Event of Default shall have occurred and be continuing and the Holder of a Note
gives to the Trustee written notice of a continuing Event of Default;

 

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

 

(c)           such
Holder or Holders of Notes offer and, if requested, provide to the Trustee
indemnity satisfactory to the Trustee against any loss, liability or expense in
complying with such request;

 

(d)           the
Trustee does not comply with the request within 60 days after receipt of
the request and the offer and, if requested, the provision of indemnity; and

 

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

 

A Holder of a
Note may not use this Indenture to prejudice the rights of another Holder of a
Note or to obtain a preference or priority over another Holder of a Note (it
being understood that the Trustee does not have an affirmative duty to
ascertain whether or not such actions or forbearances are unduly prejudicial to
such Holders).

 

Section 6.7.                                   Rights
of Holders of Notes to Receive Payment.

 

Notwithstanding
any other provision of this Indenture, the right of any Holder of a Note to
receive payment of principal of, or premium, if any, interest or Additional
Interest, if any, on such Note, on or after the respective due dates thereon
(including in connection with an offer to repurchase), 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 written consent of such Holder.

 

Section 6.8.                                   Collection
Suit by Trustee.

 

If an Event of
Default specified in Section 6.l(a) or (b) occurs and is continuing, the
Trustee is authorized to recover judgment in its own name and as trustee of an
express trust against the Company, upon demand of the Trustee, for the whole
amount of principal of, premium and Additional Interest, if any, and interest
remaining unpaid on the Notes and interest on overdue principal and, to the
extent lawful, interest and Additional Interest, if any, and such further
amounts as shall be sufficient to cover the costs and expenses of collection,
including the reasonable compensation, expense, disbursements and advances of
the Trustee, its agents and counsel.

 

81

 

Section 6.9.                                   [Reserved].

 

Section 6.10.                             Trustee
May File Proofs of Claim.

 

The Trustee is
authorized to file such proofs of claim and other papers or documents as may be
necessary or advisable and take any and all actions authorized under the TIA in
order to have the claims of the Trustee (including any claim for the reasonable
compensation, expenses, disbursements and advances of the Trustee, its agents
and counsel) and the Holders of the Notes allowed in any judicial proceedings
relative to the Company (or any other obligor upon the Notes), its creditors or
its property and shall be entitled and empowered to collect, receive and
distribute any money or other property payable or deliverable on any such
claims, and any custodian in any such judicial proceeding is hereby authorized
by each Holder to make such payments to the Trustee, and in the event that the
Trustee shall consent to the making of such payments directly to the Holders,
to pay to the Trustee any amount due to it for the reasonable compensation,
expenses, disbursements and advances of the Trustee, its agents and counsel,
and any other amounts due the Trustee under Section 7.7.  To the extent that the payment of any such
compensation, expenses, disbursements and advances of the Trustee, its agents
and counsel, and any other amounts due the Trustee under Section 7.7 out
of the estate in any such proceeding, shall be denied for any reason, payment
of the same shall be secured by a lien on, and shall be paid out of, any and
all distributions, dividends, money, securities and other properties that the
Holders may be entitled to receive in such proceeding whether in liquidation or
under any plan of reorganization or arrangement or otherwise.  Nothing herein contained shall be deemed to
authorize the Trustee to authorize or consent to or accept or adopt on behalf
of any Holder any plan of reorganization, arrangement, adjustment or composition
affecting the Notes or the rights of any Holder, or to authorize the Trustee to
vote in respect of the claim of any Holder in any such proceeding.

 

Section 6.11.                             Priorities.

 

If the Trustee
collects any money pursuant to this Article VI, it shall pay out the money in
the following order:

 

First:  to the Trustee, its agents and attorneys for
amounts due under Section 7.7;

 

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

 

Third:  to the Company or to such party as a court of
competent jurisdiction shall direct.

 

The Trustee
may fix a special record date and payment date for any payment to Holders of
Notes pursuant to this Section 6.11.

 

82

 

Section 6.12.                             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 a Trustee, a court
in its discretion may require the filing by any party litigant in the suit of
an undertaking to pay the costs of the suit, and the court in its discretion
may assess reasonable costs, including reasonable attorneys’ fees and expenses
against any party litigant in the suit, having due regard to the merits and
good faith of the claims or defenses made by the party litigant.  This Section 6.12 shall not apply to a
suit by the Trustee, a suit by a Holder pursuant to Section 6.7, or a suit
by Holders of more than 10% in aggregate principal amount of the then outstanding
Notes.

 

ARTICLE VII.

 

TRUSTEE

 

Section 7.1.                                   Duties
of Trustee.

 

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

 

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

 

(i)            the
duties of the Trustee shall be determined solely by the express provisions of
this Indenture and the TIA and the Trustee need perform only those duties that
are specifically set forth in this Indenture and the TIA and no others, and no
implied covenants or obligations shall be read into this Indenture or the TIA
against the Trustee; and

 

(ii)           in
the absence of bad faith on its part, the Trustee may conclusively rely,
without investigation, as to the truth or the statements and the correctness of
the opinions expressed therein, upon Officers’ Certificates or Opinions of
Counsel furnished to the Trustee and conforming to the requirements of this
Indenture but need not verify the contents thereof.

 

However, the
Trustee shall examine the Officers’ Certificates or Opinions of Counsel to determine
whether or not they conform on their face to the requirements of this Indenture
(but need not confirm or investigate the accuracy of mathematical calculations
or other facts stated therein).

 

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

 

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

 

83

 

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

 

(iii)          the
Trustee shall not be liable with respect to any action it takes or omits to
take in good faith in accordance with a direction received by it pursuant to
Section 6.5.

 

(d)           Whether
or not therein expressly so provided, every provision of this Indenture that in
any way relates to the Trustee is subject to paragraphs (a), (b), (c) and (e)
of this Section 7.1 and Section 7.2.

 

(e)           No
provision of this Indenture shall require the Trustee to expend or risk its own
funds or otherwise incur any liability in the performance of any of its duties
hereunder or in the exercise of its rights and powers, if it has reasonable
grounds to believe that repayment of such funds or adequate indemnity against
such risk or liability is not reasonably assured to it.  The Trustee shall be under no obligation to
exercise any of its rights and powers under this Indenture at the request of
any Holders, pursuant to the provisions of this Indenture, including, without
limitation, Section 6.5, unless such Holder shall have offered to the
Trustee security and indemnity satisfactory to it against any loss, liability
or expense which might be incurred by it in compliance with such request or direction.

 

(f)            The
Trustee shall not be liable for interest on any money or other property
received by it or for holding moneys or other property uninvested, in either
case, except as the Trustee may agree in writing with the Company.  Money and other property held in trust by the
Trustee shall, until used or applied as herein provided, be held in trust for
the purposes for which they were received, but need not be segregated from
other funds except to the extent required by law.

 

Section 7.2.                                   Rights
of Trustee.

 

(a)           The
Trustee may conclusively rely and shall be protected in acting or refraining
from acting upon any document believed by it to be genuine and to have been
signed or presented by the proper Person. 
The Trustee need not investigate any fact or matter stated in the
document.

 

(b)           Before
the Trustee acts or refrains from acting, it may require an Officer’s
Certificate or an Opinion of Counsel or both. 
The Trustee shall not be liable for any action it takes or omits to take
in good faith in reliance on such Officer’s Certificate or Opinion of Counsel.  The Trustee may consult with counsel of its
own selection and the advice of such counsel and Opinions of Counsel with
respect to legal matters relating to this Indenture and the Notes shall be full
and complete authorization and protection from liability in respect of any
action taken, suffered or omitted by it hereunder in good faith and in reliance
thereon.

 

(c)           The
Trustee may act through its attorneys, accountants, experts and such other
professionals as the Trustee deems necessary, advisable or appropriate and
shall not be responsible for the misconduct or negligence of any attorney,
accountant, expert or other such professional appointed with due care.

 

84

 

(d)           The
Trustee shall not be liable for any action it takes or omits to take in good
faith that it believes to be authorized or within the rights or powers
conferred upon it by this Indenture, provided, however, that the
Trustee’s conduct does not constitute willful misconduct, bad faith or
negligence.

 

(e)           Unless
otherwise specifically provided in this Indenture, any demand, request,
direction or notice from the Company shall be sufficiently evidenced by a
written order signed by one Officer of the Company.

 

(f)            The
Trustee shall not be charged with knowledge of any Default or Event of Default
under Section 6.1 (other than under Section 6.1(a) (subject to the following
sentence) or Section 6.1(b)) unless either (i) a Responsible Officer
of the Trustee shall have actual knowledge thereof, or (ii) the Trustee or
its Responsible Officer shall have received notice thereof in accordance with
Section 13.2 from the Company or any obligor on the Notes or by any Holder
of the Notes.  The Trustee shall not be
charged with knowledge of the Company’s obligation to pay Additional Interest,
or the cessation of such obligation, unless the Trustee receives written notice
thereof from the Company or any Holder.

 

(g)           The
rights, privileges, protections, immunities and benefits given to the Trustee
pursuant to this Indenture, including, without limitation, its right to be
indemnified, are extended to, and shall be enforceable by, the Trustee in each
of its capacities hereunder, and each agent, custodian and other Person
employed to act hereunder.

 

(h)           The
Trustee may request that the Company deliver an Officer’s Certificate setting
forth the names of individuals and/or titles of officers authorized at such
time to take specified actions pursuant to this Indenture, which Officer’s
Certificate may be signed by any person specified as so authorized in any such
certificate previously delivered and not superseded.

 

Section 7.3.                                   Individual
Rights of Trustee.

 

The Trustee in
its individual or any other capacity may become the owner or pledgee of Notes
and may otherwise deal with the Company or any Affiliate of the Company with
the same rights it would have if it were not Trustee.  However, in the event that the Trustee acquires
any conflicting interest within the meaning of the TIA it must eliminate such
conflict within 90 days, or apply (subject to the consent of the Company)
to the Commission for permission to continue as trustee or resign.  Any Agent may do the same with like rights
and duties.  The Trustee is also subject
to Sections 7.10 and 7.11.

 

Section 7.4.                                   Trustee’s
Disclaimer.

 

The Trustee
shall not be responsible for and makes no representation as to the validity or
adequacy of this Indenture, or the Notes, it shall not be accountable for the
Company’s use of the proceeds from the Notes or any money paid to the Company
or upon the Company’s direction under any provision of this Indenture, it shall
not be responsible for the use or application of any money received by any
Paying Agent other than the Trustee, and it shall not be responsible for any
statement or recital herein or any statement in the Notes or any other document
in connection with the sale of the Notes or pursuant to this Indenture other
than the Trustee’s certificate of authentication.

 

85

 

Section 7.5.                                   Notice
of Defaults.

 

If a Default
or Event of Default occurs with respect to the Notes and is continuing, and if
it is known to the Trustee, the Trustee shall mail to Holders of Notes a notice
of the Default or Event of Default within 90 days after such Event of
Default becomes known to the Trustee or written notice of it is received by a
Responsible Officer of the Trustee. 
Except in the case of a Default in payment on any Note (including the
failure to make a mandatory repurchase pursuant hereto), the Trustee may
withhold the notice if and so long as a committee of its Responsible Officers
in good faith determines that withholding the notice is in the interests of the
Holders of the Notes.

 

Section 7.6.                                   Reports
by Trustee to Holder of the Notes.

 

Within
60 days after each February 15 beginning with the February 15
following the date of this Indenture, and for so long as Notes remain
outstanding, the Trustee shall mail to the Holders of the Notes a brief report
dated as of such reporting date that complies with TIA § 313(a) (but if no
event described in TIA § 313(a) has occurred within the twelve months preceding
the reporting date, no report need be transmitted).  The Trustee also shall comply with TIA
§ 313(b).  The Trustee shall also
transmit by mail all reports as required by TIA § 313(c).

 

A copy of each
report at the time of its mailing to the Holders of Notes shall be mailed to
the Company and filed with the Commission and each stock exchange (if any) on
which the Notes are listed in accordance with TIA § 313(d).  The Company shall promptly notify the Trustee
in writing when the Notes are listed on any stock exchange or of any delisting
thereof.

 

Section 7.7.                                   Compensation,
Reimbursement and Indemnity.

 

The Company
shall pay to the Trustee from time to time such reasonable compensation for its
acceptance of this Indenture and the rendering by it of the services required
hereunder as shall be agreed upon in writing by the Company and the Trustee
from time to time.  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 promptly upon request for all reasonable out-of-pocket disbursements,
advances and expenses incurred or made by or on behalf of it in accordance with
the provisions of this Indenture, in addition to the compensation for its
services, except any such expense, disbursement or advance as may arise from
its negligence, willful misconduct or bad faith.  Such expenses shall include the reasonable
compensation, disbursements and expenses of the Trustee’s attorneys,
accountants, experts and such other professionals as the Trustee deems necessary,
advisable or appropriate.  The Trustee
shall provide the Company reasonable notice of any expenditure which is not in
the ordinary course of business.

 

The Company
and the Guarantors shall jointly and severally indemnify the Trustee and any
predecessor Trustee (which for purposes of this Section 7.7 shall include
its officers, directors, employees and agents), and hold it harmless against,
any and all losses, liabilities, claims, damages or reasonable out-of-pocket
expenses, including taxes (other than taxes based upon, measured by or
applicable to the income or compensation of the Trustee) and

 

86

 

reasonable attorneys’ fees and expenses, incurred by it arising out of
or in connection with the acceptance or administration of its duties under this
Indenture (including its duties under Section 9.6), including the costs
and expenses of enforcing this Indenture or any Guarantee against the Company
or a Guarantor (including this Section 7.7) and defending itself against
or investigating any claim (whether asserted by the Company, any Guarantor, any
Holder or any other Person) or liability in connection with the exercise or
performance of any of its powers or duties hereunder, except to the extent any
such loss, damage, claim, liability or expense may be attributable to its
negligence, willful misconduct or bad faith. 
The Trustee shall notify the Company promptly of any claim for which it
may seek indemnity.  Failure by the
Trustee to so notify the Company shall not relieve the Company of its
obligations hereunder

 

The Company
shall defend any claim or threatened claim asserted against the Trustee, with
counsel reasonably satisfactory to the Trustee, and the Trustee shall cooperate
in the defense of such claim at the Company’s expense.  If in the opinion of counsel to the Trustee,
the facts and/or issues surrounding the claim are reasonably likely to create a
conflict of interest with the Company, the Trustee may have separate counsel
and the Company shall pay the reasonable fees and expenses of such
counsel.  The Company need not reimburse
any losses, liabilities, claims, damages or expenses, or indemnify any loss,
liability or expense incurred by the Trustee through the Trustee’s own willful
misconduct, negligence or bad faith.  The
Company need not pay for any settlement made without its consent, which consent
shall not be unreasonably withheld.

 

The
obligations of the Company and the Guarantors under this Section 7.7 shall
survive the resignation or removal of the Trustee, the satisfaction and
discharge of this Indenture and the termination of this Indenture.

 

To secure the
Company’s payment obligations in this Section 7.7, the Trustee shall have
a Lien prior to the Notes on all money or property held or collected by the
Trustee, except that held in trust to pay principal, Redemption Price or
Purchase Price of or Additional Interest, if any, or interest on, particular
Notes.  Such Lien shall survive the
resignation or removal of the Trustee, the satisfaction and discharge of this
Indenture and the termination of this Indenture.

 

When the
Trustee incurs expenses or renders services after an Event of Default specified
in Section 6.1(f) or (g) occurs, the expenses and the compensation for the
services (including the fees and expenses of its agents and counsel) are
intended to constitute expenses of administration under any Bankruptcy Law.

 

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

 

87

 

Section 7.8.                                   Replacement
of Trustee.

 

A resignation
or removal of the Trustee and appointment of a successor Trustee shall become
effective only upon the successor Trustee’s acceptance of appointment as
provided in this Section.

 

The Trustee
may resign in writing at any time upon 30 days written notice to the Company
and be discharged from the trust hereby created by so notifying the Company.  The Holders of Notes of a majority in
principal amount of the then outstanding Notes may remove the Trustee upon 30
days written notice to the Trustee by so notifying the Trustee and the Company
in writing and may appoint a successor Trustee, which successor Trustee shall
be reasonably acceptable to the Company. 
The Company may remove the Trustee if:

 

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

 

(b)           the
Trustee is adjudged a bankrupt or an insolvent or an order for relief is
entered with respect to the Trustee under any Bankruptcy Law;

 

(c)           a
custodian, receiver or public officer takes charge of the Trustee or its property
for the purpose of rehabilitation, conversation or liquidation; or

 

(d)           the
Trustee becomes incapable of acting.

 

If the Trustee
resigns or is removed 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.

 

If a successor
Trustee does not take office within 30 days after the retiring Trustee resigns
or is removed, the retiring Trustee, the Company, or the Holders of Notes of at
least 10% in principal amount of the then outstanding Notes may petition any
court of competent jurisdiction, in the case of the Trustee, at the expense of
the Company, for the appointment of a successor Trustee.

 

If the
Trustee, after written request by any Holder of a Note who has been a bona fide
holder of a Note or Notes for at least six months, fails to comply with Section 7.10,
such Holder of a Note may petition any court of competent jurisdiction for the
removal of the Trustee and the appointment of 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 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 each Holder of a
Note.  The retiring Trustee shall
promptly transfer all property held by it as Trustee to the successor Trustee; provided
all sums owing to the Trustee hereunder have been paid and subject to the Lien
provided for in Section 7.7. 
Notwithstanding replacement of the Trustee pursuant to this
Section 7.8, the Company’s obligations under Section 7.7 shall continue
for the benefit of the retiring Trustee.

 

88

 

Section 7.9.                                   Successor
Trustee by Merger, Etc.

 

If the Trustee
consolidates, merges or converts into, or transfers all or substantially all of
its corporate trust business to, another corporation that is eligible under
Section 7.10, the successor corporation without any further act shall be
the successor Trustee; provided that such corporation shall be otherwise
qualified and eligible under this Article VII and Section 310(a) of the TIA,
without the execution or filing of any paper or any further act on the part of
the parties hereto.

 

Section 7.10.                             Eligibility;
Disqualification.

 

There shall at
all times be a Trustee hereunder that is a corporation organized and doing
business under the laws of the United States of America or of any state thereof
(including the District of Columbia) that is authorized under such laws to
exercise corporate trust power, that is subject to supervision or examination
by federal or state authorities and that has (or, in the case of a corporation
included in a bank holding company system, the related bank holding company
shall have) a combined capital and surplus of at least $50.0 million as set
forth in its (or its related bank holding company’s) most recent published
annual report of condition.

 

This Indenture
shall always have a Trustee who satisfies the requirements of TIA
§§ 310(a)(1), (2) and (5).  The
Trustee shall comply with TIA § 310(b).

 

Section 7.11.                             Preferential
Collection of Claims Against Company.

 

The Trustee is
subject to TIA § 311(a), excluding any creditor relationship listed in TIA
§ 311(b).  A Trustee who has
resigned or been removed shall be subject to TIA § 311(a) to the extent
indicated therein.  The Trustee hereby waives any right to set-off any
claim that it may have against the Company in any capacity (other than as Trustee
and Paying Agent) against any of the assets of the Company held by the Trustee.

 

ARTICLE VIII.

 

LEGAL DEFEASANCE AND COVENANT DEFEASANCE

 

Section 8.1.                                   Option
to Effect Legal Defeasance or Covenant Defeasance.

 

The Company
may, at its option, at any time, elect to have either Section 8.2 or 8.3
applied to all outstanding Notes upon compliance with the conditions set forth
below in this Article VIII.

 

Section 8.2.                                   Legal
Defeasance and Discharge.

 

Upon the
Company’s exercise under Section 8.1 of the option applicable to this
Section 8.2, the Company and the Guarantors shall each subject to the
satisfaction by the Company of the conditions set forth in Section 8.4, be
discharged from their respective obligations with respect to all outstanding
Notes on the date the conditions set forth below are satisfied (hereinafter, “Legal
Defeasance”).  For this purpose,
Legal Defeasance means that the Company shall be deemed to have paid and
discharged the entire Indebtedness represented by

 

89

 

the outstanding Notes, which shall thereafter be deemed to be “outstanding”
only for the purposes of Section 8.5 and the other Sections of this
Indenture referred to in clauses (a) through (d) below, and to have
satisfied all their other obligations under such Notes and this Indenture (and
the Trustee, on demand of and at the expense of the Company, shall execute
proper instruments acknowledging the same), except for the following provisions
that shall survive until otherwise terminated or discharged hereunder:

 

(a)           the
rights of Holders to receive, solely from the funds in trust (as set forth in
clause (1) of Section 8.4) payments in respect of the principal of, premium, if
any, and interest on the Notes when such payments are due;

 

(b)           the
Company’s obligations with respect to the Notes concerning issuing temporary
Notes, registration of Notes, mutilated, destroyed, lost or stolen Notes and
the maintenance of an office or agency for payments;

 

(c)           the
rights, powers, trust, duties and immunities of the Trustee and the Company’s
obligations in connection therewith; and

 

(d)           the
Legal Defeasance provisions of this Article VIII.

 

Subject to
compliance with this Article VIII, the Company may exercise its option
under this Section 8.2, notwithstanding the prior exercise of its option
under Section 8.3.

 

Section 8.3.                                   Covenant
Defeasance.

 

Upon the
Company’s exercise under Section 8.1 of the option applicable to this
Section 8.3, the Company and the Guarantors shall each, subject to the
satisfaction by the Company of the conditions set forth in Section 8.4, be
released from its obligations under the covenants contained in Sections 3.9,
3.10, 4.3, 4.5, 4.7 through 4.12, 4.13 (except to the extent that it applies to
the Company’s existence), and 4.14 through 4.19, both inclusive, and
Section 5.1 with respect to the outstanding Notes on and after the date
the conditions set forth below are satisfied (hereinafter, “Covenant Defeasance”),
and the Notes shall thereafter be deemed not “outstanding” for the purposes of
any direction, waiver, consent or declaration or act of Holders (and the
consequences of any thereof) in connection with such covenants, but shall
continue to be deemed “outstanding” for all other purposes hereunder (it being
understood that such Notes shall not be deemed outstanding for accounting
purposes, unless the Company has been advised by its independent public
accountants that, under the accounting literature in effect at such time, the
Notes must continue to be treated as outstanding for accounting purposes).  For this purpose, Covenant Defeasance means
that, with respect to the outstanding Notes, the Company may omit to comply
with and shall have no liability in respect of any term, condition or
limitation set forth in any such covenant, whether directly or indirectly, by
reason of any reference elsewhere herein to any such covenant or by reason of
any reference in any such covenant to any other provision herein or in any
other document, and such omission to comply shall not constitute a Default or
an Event of Default under Section 6.1, but, except as specified above, the
remainder of this Indenture and such Notes shall be unaffected thereby.  In addition, upon the Company’s exercise
under Section 8.1 of the option applicable to this Section 8.3,

 

90

 

subject to the satisfaction of the conditions set forth in
Section 8.4, Sections 6.1(c) through 6.1(e) and 6.1(h) shall not constitute
Events of Default.

 

Section 8.4.                                   Conditions
to Legal or Covenant Defeasance.

 

The following
are the conditions precedent to the application of either Section 8.2 or
8.3 to the outstanding Notes:

 

In order to
exercise either Legal Defeasance or Covenant Defeasance:

 

(1)           the
Company must irrevocably deposit with the Trustee, in trust, for the benefit of
the Holders cash in U.S. dollars, non-callable U.S. Government Obligations, or
a combination thereof, in such amounts as will be sufficient, in the opinion of
a nationally recognized firm of independent public accountants, to pay the
principal of, premium, if any, and interest on the Notes on the stated date for
payment thereof or on the applicable redemption date, as the case may be;

 

(2)           in
the case of Legal Defeasance, the Company shall have delivered to the Trustee
an Opinion of Counsel in the United States reasonably acceptable to the Trustee
confirming that:

 

(a)           the
Company has received from, or there has been published by, the Internal Revenue
Service a ruling; or

 

(b)           since
the Issue Date, 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 in the United
States reasonably acceptable to the Trustee shall confirm that, the Holders
will not recognize income, gain or loss for federal income tax purposes as a
result of such Legal Defeasance and will be subject to federal income tax on
the same amounts, in the same manner and at the same times as would have been
the case if such Legal Defeasance had not occurred;

 

(3)           in
the case of Covenant Defeasance, the Company shall have delivered to the
Trustee an Opinion of Counsel in the United States reasonably acceptable to the
Trustee confirming that the 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;

 

(4)           no
Default shall have occurred and be continuing on the date of such deposit
(other than a Default or Event of Default resulting from the borrowing of funds
to be applied to such deposit and the grant of any Lien securing such borrowings);

 

(5)           such
Legal Defeasance or Covenant Defeasance shall not result in a breach or
violation of, or constitute a default under, this Indenture (other than a
Default or an Event or Default resulting from the borrowing of funds to be
applied to such deposit

 

91

 

and the grant of any Lien securing such borrowings) or any other
material agreement or instrument to which the Company or any of its Restricted
Subsidiaries is a party or by which the Company or any of its Subsidiaries is
bound;

 

(6)           the
Company shall have delivered to the Trustee an Officer’s Certificate stating
that the deposit was not made by the Company with the intent of preferring the
Holders over any other creditors of the Company or with the intent of hindering
or defrauding any other creditors of the Company or others; and

 

(7)           the
Company shall have delivered to the Trustee an Officer’s Certificate and an
Opinion of Counsel, each stating that all conditions precedent provided for or
relating to the Legal Defeasance or the Covenant Defeasance have been complied
with.

 

Notwithstanding
the foregoing, the Opinion of Counsel required by clauses (2)(a) and (3)
above need not be delivered if all Notes not theretofore delivered to the
Trustee for cancellation (1) have become due and payable, (2) will
become due and payable on the maturity date within one year or (3) are to
be called for redemption within one year under arrangements satisfactory to the
Trustee for the giving of notice of redemption by the Trustee in the name, and
at the expense, of the Company.

 

Section 8.5.                                   Deposited
Money and U.S. Government Obligations to Be Held in Trust; Other Miscellaneous
Provisions.

 

Subject to
Section 8.6, all money and U.S. Government Obligations (including the
proceeds thereof) deposited with the Trustee (or other qualifying trustee,
collectively for purposes of this Section 8.5 only, the “Trustee”)
pursuant to Section 8.4 in respect of the outstanding Notes shall be held
in trust and applied by the Trustee, in accordance with the provisions of such
Notes and this Indenture, to the payment, either directly or through any Paying
Agent (other than the Company) as the Trustee may determine, to the Holders of
such Notes of all sums due and to become due thereon in respect of principal or
Redemption Price of, and Additional Interest, if any, interest on, the Notes,
that such money need not be segregated from other funds except to the extent
required by law.

 

The Company
shall pay and indemnify the Trustee against any tax, fee or other charge
imposed on or assessed against the cash or U.S. Government Obligations
deposited pursuant to Section 8.4 or the principal and interest received
in respect thereof other than any such tax, fee or other charge which by law is
for the account of the Holders of the outstanding Notes; provided that
the Trustee shall be entitled to charge any such tax, fee or other charge to
such Holder’s account.

 

Anything in
this Article VIII to the contrary notwithstanding, the Trustee shall deliver
or pay to the Company from time to time upon the request of the Company any
money or U.S. Government Obligations held by it as provided in Section 8.4
which, in the opinion of a nationally recognized firm of independent public
accountants, investment bank or appraisal firm expressed in a written certification
thereof delivered to the Trustee (which may be the opinion delivered under
Section 8.4(a)), are in excess of the amount thereof that would then be
required to be deposited to effect an equivalent Legal Defeasance or Covenant
Defeasance.

 

92

 

Section 8.6.                                   Repayment
to the Company.

 

Subject to any
applicable abandoned property law, any money deposited with the Trustee or any
Paying Agent, or then held by the Company, in trust for the payment of the
principal, Redemption Price or Purchase Price of, or Additional Interest, if
any, or interest on any Note and remaining unclaimed for two years after such
amount has become due and payable shall be paid to the Company on its request
or (if then held by the Company) shall be discharged from such trust; and the
Holder of such Note shall thereafter look only to the Company for payment
thereof as a general creditor, and all liability of the Trustee or such Paying
Agent with respect to such trust money, and all liability of the Company as
trustee thereof, shall thereupon cease.

 

Section 8.7.                                   Reinstatement.

 

If the Trustee
or Paying Agent is unable to apply any United States dollars or U.S. Government
Obligations in accordance with Section 8.2 or 8.3, as the case may be, by
reason of any order of judgment of any court or governmental authority
enjoining, restraining or otherwise prohibiting such application, then the
obligations of the Company and the Guarantors under this Indenture, and the
Notes and the Guarantees shall be revived and reinstated as though no deposit
had occurred pursuant to Section 8.2 or 8.3 until such time as the Trustee
or Paying Agent is permitted to apply all such money in accordance with
Section 8.2 or 8.3, as the case may be; provided, however,
that (a) if the Company makes any payment with respect to any Note
following the reinstatement of its obligations, the Company shall be subrogated
to the rights of the Holders of such Notes to receive such payment from the
money held by the Trustee or Paying Agent; and (b) unless otherwise required by
any legal proceeding or any other order or judgment of any court or
governmental authority, the Trustee or Paying Agent shall return all such money
and U.S. Obligations to the Company promptly after receiving a written request
therefore at any time, if such reinstatement of the Company’s obligations has
occurred and continues to be in effect.

 

ARTICLE IX.

 

AMENDMENT, SUPPLEMENT AND WAIVER

 

Section 9.1.                                   Without
Consent of Holders of Notes.

 

Notwithstanding
Section 9.2, the Company, the Guarantors and the Trustee may amend or
supplement this Indenture or the Notes without notice to or the consent of any
Holder of a Note to:

 

(1)           evidence
the succession of another Person to the Company, a Guarantor, or any other
obligor under the Notes, and the assumption by any such successor of the
covenants of the Company, such Guarantor or such obligor in this Indenture and
in the Notes and any Guarantee in accordance with Section 5.1;

 

(2)           add
to the covenants of the Company, any Guarantor or any other obligor under the
Notes for the benefit of the Holders of the Notes or to surrender any right or

 

93

 

power conferred upon the Company or any Guarantor or any other obligor
under the Notes, as applicable, in this Indenture, in the Notes or in any
Guarantee;

 

(3)           cure
any ambiguity, or to correct or supplement any provision in this Indenture, the
Notes or any Guarantee which may be defective or inconsistent with any other
provision in this Indenture, the Notes or any Guarantee;

 

(4)           make,
amend or supplement any provision under this Indenture, the Notes or any
Guarantee; provided that
such provisions shall not adversely affect the Holders of the Notes in any
material respect;

 

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

 

(6)           add
a Guarantor or additional obligor under this Indenture or permit any Person to
guarantee the Notes and/or obligations under this Indenture;

 

(7)           release
a Guarantor as provided in this Indenture;

 

(8)           evidence
and provide the acceptance of the appointment of a successor Trustee under this
Indenture;

 

(9)           mortgage,
pledge, hypothecate or grant a security interest in favor of the Trustee for
the benefit of the Holders of the Notes as additional security for the payment
and performance of the Company’s and any Guarantor’s obligations under this Indenture,
in any property, or assets, including any of which are required to be
mortgaged, pledged or hypothecated, or in which a security interest is required
to be granted to the Trustee pursuant to this Indenture or otherwise;

 

(10)         provide
for the issuance of additional Notes under this Indenture in accordance with
the limitations set forth in this Indenture;

 

(11)         provide
for the issuance of Exchange Notes pursuant to the terms of this Indenture and
the Registration Rights Agreement;

 

(12)         comply
with the rules of any applicable securities depositary; or

 

(13)         conform
the text of this Indenture or the Notes to any provision of the “Description of
Notes” section of the Final Memorandum.

 

Upon the
request of the Company, accompanied by a Board Resolution (evidenced by an
Officer’s Certificate) (a copy of which shall be provided to the Trustee) authorizing
the execution of any such amended or supplemental indenture, and upon receipt
by the Trustee the documents described in Section 9.6, the Trustee shall
join with the Company in the execution of any amended or supplemental indenture
authorized or permitted by the terms of this Indenture and to make any further
appropriate agreements and stipulations that may be therein contained, but the
Trustee shall not be obligated to enter into such amended or

 

94

 

supplemental Indenture that affects its own rights, duties or
immunities under this Indenture or otherwise.

 

Section 9.2.                                   With
Consent of Holders of Notes.

 

Except as
provided below in this Section 9.2, the Company and the Trustee may amend
or supplement this Indenture and the Notes may be amended or supplemented with
the consent of the Holders of at least a majority in principal amount of the
Notes then outstanding (including, without limitation, consents obtained in
connection with a tender offer or exchange offer for the Notes), and, subject
to Sections 6.2, 6.4 and 6.7, any existing Default or compliance with any
provision of this Indenture or the Notes may be waived with the consent of the
Holders of a majority in principal amount of the then outstanding Notes (including
consents obtained in connection with a tender offer or exchange offer for the
Notes).

 

Without the
consent of each Holder affected, an amendment or waiver may not:

 

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

 

(2)           reduce
the rate of or change or have the effect of changing the time for payment of
interest, including defaulted interest, on any Notes;

 

(3)           reduce
the principal of or change or have the effect of changing the fixed maturity of
any Notes, or change the date on which any Notes may be subject to redemption
or repurchase, or reduce the redemption or repurchase price therefor;

 

(4)           make
any Notes payable in money other than that stated in the Notes;

 

(5)           make
any change in provisions of this Indenture protecting the right of each Holder
to receive payment of principal of and interest on such Note on or after the
due date thereof or to bring suit to enforce such payment, or permitting
Holders of a majority in principal amount of Notes to waive Defaults or Events
of Default;

 

(6)           after
the Company’s obligation to purchase Notes arises under this Indenture, amend,
change or modify in any material respect the obligation of the Company to make
and consummate a Change of Control Offer in the event of a Change of Control or
make and consummate a Net Proceeds Offer with respect to any Asset Sale that
has been consummated or modify any of the provisions or definitions with
respect thereto;

 

(7)           modify
or change any provision of this Indenture in any manner which subordinates the
Notes in right of payment to any other Indebtedness of the Company or which
subordinates any Guarantee in right of payment to any other Indebtedness of the
Guarantor, in each case in a manner that adversely affects the Holders in any
material respect; provided that subordination shall not be affected by
the existence or lack thereof of a security interest or by priority with respect
to a security interest; or

 

95

 

(8)           release
Holdings or any Guarantor that is a Significant Subsidiary from any of its
obligations under its Guarantee of this Indenture otherwise than in accordance
with the terms of this Indenture.

 

Notwithstanding
the foregoing, if any amendment, waiver or other modification of this Indenture
or the Notes will only affect the Fixed Rate Notes or the Floating Rate Notes,
as the case may be, only the consent of the Holders of the then outstanding
Fixed Rate Notes or Floating Rate Notes, as the case may be, and not the
consent of both the Holders of Fixed Rate Notes and the Holders of Floating
Rate Notes, shall be required in accordance with this Section 9.2.

 

Upon the
written request of the Company accompanied by a Board Resolution (evidenced by
an Officer’s Certificate) (a copy of which shall be provided to the Trustee)
authorizing the execution of any such amended or supplemental indenture, and
upon the filing with the Trustee of evidence satisfactory to the Trustee of the
consent of the Holders of Notes as aforesaid, and upon receipt by the Trustee
of the documents described in Section 9.6, the Trustee shall join with the
Company in the execution of such amended or supplemental indenture unless such
amended or supplemental Indenture affects the Trustee’s own rights, duties or
immunities under this Indenture or otherwise, in which case the Trustee may in
its discretion, but shall not be obligated to, enter into such amended or supplemental
indenture.

 

It shall not
be necessary for the consent of the Holders of Notes under this Section 9.2
to approve the particular form of any proposed amendment or waiver, but it
shall be sufficient if such consent approves the substance thereof.

 

After an
amendment, supplement or waiver under this Section 9.2 becomes effective,
the Company shall mail to the Holders of Notes affected thereby a notice
briefly describing the amendment, supplement or waiver.  Any failure of the Company to mail such notice,
or any defect therein, shall not, however, in any way impair or affect the
validity of any such amended or supplemental Indenture or waiver.

 

Section 9.3.                                   Compliance
with Trust Indenture Act.

 

Every
amendment or supplement to this Indenture or the Notes shall be set forth in an
amended or supplemental indenture that complies with the TIA as then in effect.

 

Section 9.4.                                   Revocation
and Effect of Consents.

 

Until an
amendment, supplement or waiver becomes effective, a consent to it by a Holder
of a Note is a continuing consent by the Holder of a Note and every subsequent
Holder of a Note or portion of a Note that evidences the same debt as the
consenting Holder’s Note, even if notation of the consent is not made on any
Note.  However, any such Holder of a Note
or subsequent Holder of a Note may revoke the consent as to its Note if the
Trustee receives written notice of revocation before the date the waiver,
supplement or amendment becomes effective. 
An amendment, supplement or waiver becomes effective in accordance with
its terms and thereafter binds every Holder.

 

96

 

The Company
may, but shall not be obligated to, fix a record date for the purpose of
determining the Holders of Notes entitled to give their consent or take any
other action described above or required or permitted to be taken pursuant to
this Indenture.  If a record date is
fixed, then notwithstanding the immediately preceding paragraph, those Persons
who were Holders of Notes 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, and no such consent
shall be valid or effective for more than 120 days after such record date.

 

Section 9.5.                                   Notation
on or Exchange of Notes.

 

The Trustee
may place an appropriate notation about an amendment, supplement or waiver on
any Note thereafter authenticated.  The
Company in exchange for all Notes may issue and the Trustee shall authenticate new
Notes that reflect the amendment, supplement or waiver.

 

Failure to
make the appropriate notation or issue a new Note shall not affect the validity
and effect of such amendment, supplement or waiver.

 

Section 9.6.                                   Trustee
to Sign Amendment, Etc.

 

The Trustee
shall sign any amended or supplemental indenture authorized pursuant to this
Article IX if the amendment or supplement does not adversely affect the
rights, duties, liabilities or immunities of the Trustee.  If it does, the Trustee may but need not sign
it.  The Company may not sign an amended
or supplemental indenture until the Board of Directors approves such amended or
supplemental indenture.  In executing any
amended or supplemental indenture, the Trustee shall be entitled to receive the
documents required by Sections 13.4 and 13.5, and, subject to Section 7.1,
shall be fully protected in relying upon such documents.

 

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

 

ARTICLE X.

 

[RESERVED]

 

 

 

ARTICLE XI.

 

GUARANTEE

 

Section 11.1.                             Unconditional
Guarantee.

 

Each Guarantor
hereby unconditionally guarantees (such guarantee to be referred to herein as a
“Guarantee”), on a senior unsecured basis jointly and severally, to each
Holder of a

 

97

 

Note authenticated and delivered by the Trustee and to the Trustee and
its successors and assigns, the Notes or the obligations of the Company
hereunder or thereunder, that: 
(i) the principal of and interest on the Notes will be promptly
paid in full when due, subject to any applicable grace period, whether at
maturity, by acceleration or otherwise and interest on the overdue principal,
if any, and interest on any interest, to the extent lawful, of the Notes and
all other obligations of the Company to the Holders or the Trustee hereunder or
thereunder will be promptly paid in full or performed, all in accordance with
the terms hereof and thereof; and (ii) in case of any extension of time of
payment or renewal of any Notes or of any such other obligations, the same will
be promptly paid in full when due or performed in accordance with the terms of
the extension or renewal, subject to any applicable grace period, whether at
stated maturity, by acceleration or otherwise, subject, however, in the case of
clauses (i) and (ii) above, to the limitations set forth in
Section 11.4.  Each Guarantor agrees
that this is a guarantee of payment and not a guarantee of collection.  Each Guarantor hereby agrees that (to the extent
permitted by law) its obligations hereunder shall be unconditional,
irrespective of the validity, regularity or enforceability of the Notes or this
Indenture, the absence of any action to enforce the same, any waiver or consent
by any Holder of the Notes with respect to any provisions hereof or thereof,
the recovery of any judgment against the Company, and action to enforce the
same or any other circumstance which might otherwise constitute a legal or
equitable discharge or defense of a guarantor. 
Subject to Section 6.6, each Guarantor hereby waives (to the extent
permitted by law) diligence, presentment, demand of payment, filing of claims
with a court in the event of insolvency or bankruptcy of the Company, any right
to require a proceeding first against the Company, protest, notice and all
demands whatsoever and covenants that this Guarantee will not be discharged
except by complete performance of the obligations contained in the Notes, this
Indenture and in this Guarantee.  If any
Holder or the Trustee is required by any court or otherwise to return to the Company,
any Guarantor, or any custodian, trustee, liquidator or other similar official
acting in relation to the Company or any Guarantor, any amount paid by the
Company or any Guarantor to the Trustee or such Holder, this Guarantee, to the
extent theretofore discharged, shall be reinstated in full force and
effect.  Each Guarantor further agrees
that, as between each Guarantor, on the one hand, and the Holders and the
Trustee, on the other hand, (x) the maturity of the obligations guaranteed
hereby may be accelerated as provided in Article VI for the purposes of
this Guarantee, notwithstanding any stay, injunction or other prohibition
preventing such acceleration in respect of the obligations guaranteed hereby,
and (y) in the event of any acceleration of such obligations as provided
in Article VI, such obligations (whether or not due and payable) shall
forthwith become due and payable by each Guarantor for the purpose of this
Guarantee.

 

Section 11.2.                             [Reserved].

 

Section 11.3.                             Severability.

 

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

 

98

 

Section 11.4.                             Limitation
of Guarantor’s Liability.

 

Each
Guarantor, and by its acceptance of Notes, each Holder, hereby confirms that it
is the intention of all such parties that the guarantee by such Guarantor
pursuant to its Guarantee not constitute a fraudulent transfer or conveyance
for purposes of any Bankruptcy Law, the Uniform Fraudulent Conveyance Act, the
Uniform Fraudulent Transfer Act or any similar Federal or state law.  To effectuate the foregoing intention, the
Trustee, the Holders and such Guarantor hereby irrevocably agree that the
obligations of such Guarantor under its Guarantee shall be limited to the
maximum amount as will, after giving effect to all other contingent and fixed
liabilities (including all of its obligations under or with respect to the
Credit Agreement and all Interest Swap Obligations and obligations under
Currency Agreements) of such Guarantor and after giving effect to any
collections from or payments made by or on behalf of any other Guarantor in
respect of the obligations of such other Guarantor under its Guarantee or pursuant
to Section 11.5, result in the obligations of such Guarantor under the
Guarantee not constituting such fraudulent transfer or conveyance.

 

Section 11.5.                             Release
of Guarantor.

 

(a)           The
Guarantee of a Guarantor will be automatically and unconditionally released
without any action on the part of the Trustee or the Holders of the Notes:  (1) in connection with any sale or other
disposition of all or substantially all of the assets of that Guarantor
(including, without limitation, by way of merger or consolidation) to a Person
that is not (either before or after giving effect to such transaction) the
Company or a Restricted Subsidiary, if the sale or other disposition of all or
substantially all of the assets of that Guarantor complies with the applicable
provisions of this Indenture; (2) in connection with any sale of a majority of
the Capital Stock of a Guarantor to a Person that is not (either before or
after giving effect to such transaction) the Company or a Restricted
Subsidiary, if the sale of such Capital Stock of that Guarantor complies with
the applicable provisions of this Indenture; (3) if the Company properly
designates any Restricted Subsidiary that is a Guarantor as an Unrestricted
Subsidiary in accordance with the applicable provisions of this Indenture;
(4) if such Guarantor is properly designated as a Non-Guarantor Restricted
Subsidiary and is not required to issue a Guarantee of the Notes pursuant to
Section 4.16; (5) if a Guarantor under all Credit Facilities is released from
its Guarantee pursuant to the terms of all Credit Facilities; or (6) if the
Notes are discharged in accordance with the procedures described under Section
8.2, 8.3 or 12.1.

 

(b)           The
Trustee shall deliver an appropriate instrument evidencing such release upon
receipt of a request by the Company accompanied by an Officer’s Certificate
and, if requested by the Trustee, Opinion of Counsel certifying as to the
compliance with this Section 11.5.

 

Section 11.6.                             Contribution.

 

Each Guarantor
that makes a payment or distribution under any Guarantee shall have the right
to seek contribution from the Company or any non-paying Guarantor that has also
Guaranteed the Notes in respect of which such payment or distribution is made,
in a pro rata amount based on the
net assets of each Guarantor determined in accordance with GAAP, so long as the
exercise of such right does not impair the rights of the Holders under this
Guarantee.

 

99

 

Section 11.7.                             Waiver
of Subrogation.

 

Until all
Obligations are paid in full, each Guarantor hereby irrevocably waives any
claims or other rights which it may now or hereafter acquire against the
Company that arise from the existence, payment, performance or enforcement of
such Guarantor’s obligations under its Guarantee and this Indenture, including,
without limitation, any right of subrogation, reimbursement, exoneration,
indemnification, and any right to participate in any claim or remedy of any
Holder against the Company, whether or not such claim, remedy or right arises
in equity, or under contract, statute or common law, including, without
limitation, the right to take or receive from the Company, directly or
indirectly, in cash or other property or by setoff or in any other manner,
payment or security on account of such claim or other rights.  If any amount shall be paid to any Guarantor
in violation of the preceding sentence and the Notes shall not have been paid
in full, such amount shall have been deemed to have been paid to such Guarantor
for the benefit of, and held in trust for the benefit of, the Holders, and
shall, forthwith be paid to the Trustee for the benefit of such Holders to be
credited and applied upon the Notes, whether matured or unmatured, in
accordance with the terms of this Indenture. 
Each Guarantor acknowledges that it will receive direct and indirect
benefits from the financing arrangements contemplated by this Indenture and
that the waiver set forth in this Section 11.7 is knowingly made in contemplation
of such benefits.

 

Section 11.8.                             Notation
Not Required.

 

Neither the
Company nor any Guarantor shall be required to make a notation on the Notes to
reflect any Guarantee or any release, termination or discharge thereof.

 

The Company
shall cause each Restricted Subsidiary that is required to become a Guarantor
after the Issue Date pursuant to Section 4.16 to execute and deliver to
the Trustee a supplemental indenture substantially in the form set forth in Exhibit
E evidencing its Guarantee on the terms and subject to the conditions set
forth in this Article XI.  Concurrently
therewith, the Company shall deliver to the Trustee an Opinion of Counsel
substantially to the effect that such supplemental indenture has been duly
authorized, executed and delivered by such Restricted Subsidiary and that,
subject to the applicable bankruptcy, insolvency, fraudulent transfer,
fraudulent conveyance, reorganization, moratorium and other laws now or
hereafter in effect affecting creditors’ rights or remedies generally and
general principles of equity, whether considered in a proceeding at law or at equity,
such supplemental indenture is a valid and binding agreement of such Restricted
Subsidiary, enforceable against such Restricted Subsidiary in accordance with
its terms.

 

Section 11.9.                             Waiver
of Stay, Extension or Usury Laws.

 

Each Guarantor
covenants (to the extent that it may lawfully do so) that it will not at any
time insist upon, plead, or in any manner whatsoever claim or take the benefit
or advantage of, any stay or extension law or any usury law or other law that
would prohibit or forgive each such Guarantor from performing its Guarantee as
contemplated herein, wherever enacted, now or at any time hereafter in force,
or which may affect the covenants or the performance of this Indenture; and (to
the extent that it may lawfully do so) each such Guarantor hereby expressly
waives all benefit or advantage of any such law, and covenants that it will not

 

100

 

hinder, delay or impede the execution of any power herein granted to
the Trustee, but will suffer and permit the execution of every such power as
though no such law had been enacted.

 

ARTICLE XII.

 

SATISFACTION AND DISCHARGE

 

Section 12.1.                             Satisfaction
and Discharge.

 

This Indenture
will be discharged and will cease to be of further effect (except as set forth
below and as to surviving rights or registration of transfer or exchange of the
Notes, as expressly provided for in this Indenture) as to all Notes issued
hereunder and then outstanding, and the Trustee, at the expense of the Company,
shall execute proper instruments acknowledging satisfaction and discharge of
this Indenture when:

 

(1)           either:

 

(a)           all
the Notes theretofore authenticated and delivered (except lost, stolen or
destroyed Notes which have been replaced or paid as provided in Section 2.7
and Notes for whose payment money has theretofore been deposited in trust or
segregated and held in trust by the Company and thereafter repaid to the
Company or discharged from such trust) have been delivered to the Trustee for
cancellation, or

 

(b)           all
Notes not theretofore delivered to the Trustee for cancellation (a) have become
due and payable, (b) will become due and payable at their Stated Maturity
within one year, or (c) are to be irrevocably called for redemption within
one year under arrangements reasonably satisfactory to the Trustee for the
giving of notice of redemption by the Trustee, and the Company has irrevocably
deposited or caused to be deposited with the Trustee funds in an amount
sufficient to pay and discharge the entire Indebtedness on the Notes not
theretofore delivered to the Trustee for cancellation, for principal of,
premium, if any, and interest on the Notes to the date of deposit together with
irrevocable instructions from the Company directing the Trustee to apply such
funds to the payment thereof at maturity or redemption, as the case may be;

 

(2)           the
Company has paid all other sums payable by the Company under this Indenture;
and

 

(3)           the
Company has delivered to the Trustee an Officer’s Certificate and an Opinion of
Counsel stating that all conditions precedent under this Indenture relating to
the satisfaction and discharge of this Indenture have been complied with.

 

Notwithstanding
the satisfaction and discharge of this Indenture, the Company’s obligations in
Sections 2.3, 2.4, 2.6, 2.7, 2.11, 7.7, 7.8, 13.2, 13.3 and 13.4 and the
Trustee’s and Paying Agent’s obligations in Section 12.2 shall survive
until the Notes are no longer outstanding. 
Thereafter, only the Company’s obligations in Section 7.7 shall
survive.

 

101

 

Section 12.2.                             Application
of Trust.

 

Subject to the
provisions of Section 8.6 hereof, all money deposited with the Trustee pursuant
to Section 12.1 shall be held in trust and, at the written direction of
the Company, be invested prior to maturity in U.S. Government Obligations, and
applied by the Trustee in accordance with the provisions of the Notes and this
Indenture, to the payment, either directly or through any Paying Agent
(including the Company acting as its own Paying Agent) as the Trustee may
determine, to the Persons entitled thereto, of the principal (and premium, if
any) and interest for the payment of which money has been deposited with the
Trustee; but such money need not be segregated from other funds except to the
extent required by law.

 

If the Trustee
or Paying Agent is unable to apply any money in accordance with Section 12.1
hereof by reason of any legal proceedings or by reason of any order or judgment
of any court or governmental authority enjoining, restraining or otherwise
prohibiting such application, the Company and the Guarantors obligations under
this Indenture and the Notes shall be revived and reinstated as though no
deposit had occurred pursuant to Section 12.1 hereof; provided that (a)
if the Company has made any payment of principal of, or premium or interest on,
any Notes because of the reinstatement of its obligations, the Company shall be
subrogated to the rights of the Holders of such Notes to receive such payment
from the money held by the Trustee or Paying Agent, and (b) the Trustee or
Paying Agent shall return all such money and Government Securities to the
Company promptly after receiving a request therefor at any time, if such
reinstatement of the Company’s obligations has occurred and continues to be in
effect.

 

ARTICLE XIII.

 

MISCELLANEOUS

 

Section 13.1.                             Trust
Indenture Act Controls.

 

If any provision
hereof limits, qualifies or conflicts with a provision of the TIA or another
provision that would be required or deemed under such Act to be part of and govern
this Indenture if this Indenture were subject thereto, the latter provision
shall control.  If any provision of this
Indenture modifies or excludes any provision of the TIA that may be so modified
or excluded, the latter provision shall be deemed to apply to this Indenture as
so modified or to be excluded, as the case may be.

 

Section 13.2.                             Notices.

 

Any notice or
communication by the Company or the Trustee to others is duly given if in
writing and delivered in Person or mailed by first-class mail (postage
prepaid), telecopier or overnight air courier guaranteeing next day delivery,
to the others’ address:

 

102

 

If to the
Company:

 

Compression
Polymers Holding Corporation

801 Corey St.

Moosic, PA  18507

Attention:  Chief Financial Officer

Fax:  (570) 961-7696

 

With a copy
to:

 

Fried, Frank,
Harris, Shriver & Jacobson LLP

One New York Plaza

New York, NY  10004

Attention:  Stuart Gelfond, Esq.

Fax:  (212) 859-8589

 

If to the
Trustee:

 

Wells Fargo
Bank, N.A.

213 Court Street, Suite 703

Middletown, CT  06457

Attention:  Corporate Trust
Administration

Fax:  860-704-6219

 

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

 

All notices
and communications (other than those sent to Holders) shall be deemed to have
been duly given:  at the time delivered
by hand, if personally delivered; five Business Days after being deposited in
the mail, postage prepaid, if mailed; when receipt acknowledged, if telecopied;
and the next Business Day after timely delivery to the courier, if sent by
overnight air courier guaranteeing next day delivery.

 

Any notice or
communication to a Holder shall be mailed by first-class mail (postage
prepaid), or by overnight air courier guaranteeing next day delivery to its
address shown on the register kept by the Registrar.  Any notice or communication shall also be so
mailed to any Person described in TIA § 313(c), to the extent required by
the TIA.  Failure to mail a notice or
communication to a Holder or any defect in it shall not affect its sufficiency
with respect to other Holders.

 

If a notice or
communication is mailed in the manner provided above within the time
prescribed, it is duly given, whether or not the address receives it.

 

If the Company
mails a notice or communication to Holders, it shall mail a copy to the Trustee
and each Agent at the same time.

 

103

 

Section 13.3.                             Communication
by Holders of Notes with Other Holders of Notes.

 

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

 

Section 13.4.                             Certificate
and Opinion as to Conditions Precedent.

 

Upon any
request or application by the Company and/or any Guarantor to the Trustee to
take any action under this Indenture, the Company and/or any Guarantor shall furnish
to the Trustee:

 

(a)           an
Officer’s Certificate to the effect that, in the opinion of the signers, all conditions
precedent and covenants, if any, provided for in this Indenture relating to the
proposed action have been satisfied; and

 

(b)           an
Opinion of Counsel to the effect that, in the opinion of such counsel, all such
conditions precedent and covenants have been satisfied.

 

Notwithstanding
the foregoing, no such Opinion of Counsel shall be given with respect to
authentication and delivery of any Initial Notes.

 

Section 13.5.                             Statements
Required in Certificate or Opinion.

 

Each
certificate or opinion with respect to compliance with a condition or covenant
provided for in this Indenture (other than a certificate provided pursuant to
TIA § 314(a)(4)) shall comply with the provisions of TIA § 314(e) and
shall include:

 

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

 

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

 

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

 

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

 

In giving any
Opinion of Counsel, counsel may rely as to factual matters on an Officer’s
Certificate or on certificates of public officials.

 

104

 

Section 13.6.                             Rules
by Trustee and Agents.

 

The Trustee
may make reasonable rules for action by or at a meeting of Holders.  The Registrar or Paying Agent may make
reasonable rules and set reasonable requirements for its functions.

 

Section 13.7.                             No
Personal Liability of Directors, Officers, Employees and Stockholders.

 

No past,
present or future director, officer, employee, incorporator, agent or stockholder
or Affiliate of the Company, as such, shall have any liability for any obligations
of the Company under the Notes, this Indenture or the Registration Rights
Agreement or for any claim based on, in respect of, or by reason of, such
obligations or their creation.  No past,
present or future director, officer, employee, incorporator, agent or
stockholder or Affiliate of any of the Guarantors, as such, shall have any liability
for any obligations of the Guarantors under the Guarantees, this Indenture or
the Registration Rights Agreement or for any claim based on, in respect of, or
by reason of, such obligations or their creation.  Each Holder of Notes and Guarantees by
accepting a Note and a Guarantee waives and releases all such liabilities.  The waiver and release are part of the
consideration for issuance of the Notes and the Guarantees.

 

Section 13.8.                                       Governing
Law; Submission to Jurisdiction; Waiver of Jury Trial.

 

THIS
INDENTURE, THE GUARANTEES AND THE NOTES SHALL BE GOVERNED BY AND CONSTRUED IN
ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK.

 

Section 13.9.                             No
Adverse Interpretation of Other Agreements.

 

This Indenture
may not be used to interpret any other indenture, loan or debt agreement of the
Company or its Subsidiaries or of any other Person.  Any such indenture, loan or debt agreement
may not be used to interpret this Indenture.

 

Section 13.10.                       Successors.

 

All agreements
of the Company in this Indenture and the Notes shall bind their successors and
assigns.  All agreements of the Trustee
in this Indenture shall bind its successors and assigns.

 

Section 13.11.                       Severability.

 

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

 

105

 

Section 13.12.                       Counterpart
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.

 

Section 13.13.                       Table of
Contents, Headings, Etc.

 

The Table of
Contents, Cross-Reference Table and headings of the Articles and Sections of
this Indenture, which have been inserted for convenience of reference only, are
not to be considered a part of this Indenture and shall in no way modify or
restrict any of the terms or provisions hereof.

 

Section 13.14.                       Qualification
of Indenture.

 

The Company
shall qualify this Indenture under the TIA in accordance with the terms and
conditions of the Registration Rights Agreement and shall pay all reasonable
costs and expenses (including reasonable attorneys’ fees and expenses for the
Company, the Trustee and the Holders of the Notes) incurred in connection
therewith, including, but not limited to, costs and expenses of qualification
of this Indenture and the Notes and printing this Indenture and the Notes.  The Trustee shall be entitled to receive from
the Company any such Officer’s Certificates, Opinions of Counsel or other
documentation as it may reasonably request in connection with any such qualification
of this Indenture under the TIA.

 

[Signatures on
following page]

 

106

 

SIGNATURES

 

	
   

  	
  COMPRESSION POLYMERS
  HOLDING CORPORATION

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ JAMES KEISLING

  	
   

  
	
   

  	
   

  	
  Name: James Keisling

  
	
   

  	
   

  	
  Title:   Chief Executive Officer

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ GARY SPITZ

  	
   

  
	
   

  	
   

  	
  Name: Gary Spitz

  
	
   

  	
  Title:     Chief Financial
  Officer

  
	
   

  	
   

  
	
   

  	
  COMPRESSION POLYMERS CORP.

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ JAMES KEISLING

  	
   

  
	
   

  	
   

  	
  Name: James Keisling

  
	
   

  	
   

  	
  Title:   Chief Executive
  Officer

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ GARY SPITZ

  	
   

  
	
   

  	
   

  	
  Name: Gary Spitz

  
	
   

  	
   

  	
  Title:   Chief Financial
  Officer

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  VYCOM CORP.

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ JAMES KEISLING

  	
   

  
	
   

  	
   

  	
  Name: James Keisling

  
	
   

  	
   

  	
  Title:   Chief Executive
  Officer

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ GARY SPITZ

  	
   

  
	
   

  	
   

  	
  Name: Gary Spitz

  
	
   

  	
   

  	
  Title:   Chief Financial
  Officer

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  CPCAPITOL ACQUISITION
  CORP.

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ JAMES KEISLING

  	
   

  
	
   

  	
   

  	
  Name: James Keisling

  
	
   

  	
   

  	
  Title:   Chief Executive
  Officer

  

 

S-1

 

	
   

  	
  By:

  	
  /s/ GARY SPITZ

  	
   

  
	
   

  	
   

  	
  Name: Gary Spitz

  
	
   

  	
   

  	
  Title:   Chief Financial
  Officer

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  WELLS FARGO BANK, N.A.,

  
	
   

  	
   

  	
  as Trustee

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ JOSEPH P. O’DONNELL

  	
   

  
	
   

  	
   

  	
  Name: Joseph P. O’Donnell

  
	
   

  	
   

  	
  Title:   Vice President

  
					

 

S-2

 

EXHIBIT A

 

FORM OF INITIAL FLOATING RATE NOTE

 

(Face of Note)

 

COMPRESSION POLYMERS HOLDING CORPORATION

 

SENIOR FLOATING RATE NOTE DUE 2012

 

[THIS NOTE IS
A GLOBAL NOTE WITHIN THE MEANING OF THE INDENTURE HEREINAFTER REFERRED TO AND
IS REGISTERED IN THE NAME OF A DEPOSITARY OR A NOMINEE OF A DEPOSITARY OR A
SUCCESSOR DEPOSITARY.  THIS NOTE IS NOT
EXCHANGEABLE FOR NOTES REGISTERED IN THE NAME OF A PERSON OTHER THAN THE
DEPOSITARY OR ITS NOMINEE EXCEPT IN THE LIMITED CIRCUMSTANCES DESCRIBED IN THE
INDENTURE, AND NO TRANSFER OF THIS NOTE (OTHER THAN A TRANSFER OF THIS NOTE AS
A WHOLE BY THE DEPOSITARY TO A NOMINEE OF THE DEPOSITARY OR BY A NOMINEE OF THE
DEPOSITARY TO THE DEPOSITARY OR ANOTHER NOMINEE OF THE DEPOSITARY) MAY BE
REGISTERED EXCEPT IN THE LIMITED CIRCUMSTANCES DESCRIBED IN THE INDENTURE.

 

UNLESS THIS
CERTIFICATE IS PRESENTED BY AN AUTHORIZED REPRESENTATIVE OF THE DEPOSITORY
TRUST COMPANY, A NEW YORK CORPORATION (“DTC”), TO THE COMPANY OR ITS AGENT FOR
REGISTRATION OF TRANSFER, EXCHANGE, OR PAYMENT, AND ANY CERTIFICATE ISSUED IS
REGISTERED IN THE NAME OF CEDE & CO. OR IN SUCH OTHER NAME AS IS REQUESTED
BY AN AUTHORIZED REPRESENTATIVE OF DTC (AND ANY PAYMENT IS MADE TO CEDE &
CO. OR TO SUCH OTHER ENTITY AS IS REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF
DTC), ANY TRANSFER, PLEDGE OR OTHER USE HEREOF FOR VALUE OR OTHERWISE BY OR TO
ANY PERSON IS WRONGFUL INASMUCH AS THE REGISTERED OWNER HEREOF, CEDE & CO.,
HAS AN INTEREST HEREIN.](1)

 

THIS NOTE (OR ITS PREDECESSOR) EVIDENCED HEREBY WAS ORIGINALLY ISSUED
IN A TRANSACTION EXEMPT FROM REGISTRATION UNDER SECTION 5 OF THE UNITED
STATES SECURITIES ACT OF 1933, AS AMENDED (THE “SECURITIES ACT”).  THIS NOTE HAS NOT BEEN REGISTERED UNDER THE
SECURITIES ACT, AND ACCORDINGLY, MAY NOT BE OFFERED, SOLD, PLEDGED OR OTHERWISE
TRANSFERRED EXCEPT PURSUANT TO AN EFFECTIVE REGISTRATION STATEMENT UNDER, OR AN
EXEMPTION FROM THE REGISTRATION REQUIREMENTS OF, THE SECURITIES ACT, IN
ACCORDANCE WITH ANY

 

(1)           To be included only if the Note is issued in
global form.

 

A-1

 

APPLICABLE SECURITIES LAWS OF ANY STATE OF THE UNITED STATES OR ANY
OTHER JURISDICTION AND IN ACCORDANCE WITH TRANSFER RESTRICTIONS CONTAINED IN
THE INDENTURE UNDER WHICH THIS NOTE WAS ISSUED AND THE OFFERING MEMORANDUM
PURSUANT TO WHICH THIS NOTE WAS ORIGINALLY SOLD.  THE HOLDER OF THE NOTE WILL, AND EACH
SUBSEQUENT HOLDER IS REQUIRED TO, NOTIFY A PROPOSED TRANSFEREE OF THE NOTICE OF
THE RESALE RESTRICTIONS APPLICABLE TO THE NOTE.

 

THIS SECURITY MAY NOT BE ACQUIRED OR HELD WITH THE ASSETS OF
(I) AN “EMPLOYEE BENEFIT PLAN” (AS DEFINED IN THE EMPLOYEE RETIREMENT INCOME
SECURITY ACT OF 1974, AS AMENDED (“ERISA”)) THAT IS SUBJECT TO ERISA,
(II) A “PLAN” DESCRIBED IN SECTION 4975 OF THE INTERNAL REVENUE CODE
OF 1986, AS AMENDED (THE “CODE”), (III) ANY ENTITY DEEMED TO HOLD “PLAN
ASSETS” OF ANY OF THE FOREGOING BY REASON OF AN EMPLOYEE BENEFIT PLAN’S OR PLAN’S
INVESTMENT IN SUCH ENTITY, OR (IV) A GOVERNMENTAL PLAN OR CHURCH PLAN
SUBJECT TO APPLICABLE LAW THAT IS SUBSTANTIALLY SIMILAR TO THE FIDUCIARY
RESPONSIBILITY OR PROHIBITED TRANSACTION PROVISIONS OF ERISA OR
SECTION 4975 OF THE CODE (“SIMILAR LAW”), UNLESS THE ACQUISITION AND
HOLDING OF THIS SECURITY BY THE PURCHASER OR TRANSFEREE, THROUGHOUT THE PERIOD
THAT IT HOLDS THIS SECURITY, ARE EXEMPT FROM THE PROHIBITED TRANSACTION RESTRICTIONS
UNDER ERISA AND/OR SECTION 4975 OF THE CODE OR UNDER ANY PROVISIONS OF
SIMILAR LAW, AS APPLICABLE, PURSUANT TO ONE OR MORE PROHIBITED TRANSACTION
STATUTORY OR ADMINISTRATIVE EXEMPTIONS. 
BY ITS ACQUISITION OR HOLDING OF THIS SECURITY, EACH PURCHASER AND
TRANSFEREE WILL BE DEEMED TO HAVE REPRESENTED AND WARRANTED THAT THE FOREGOING
REQUIREMENTS HAVE BEEN SATISFIED.

 

[Temporary
Regulation S Global Note Legend]

 

BENEFICIAL
OWNERSHIP INTERESTS IN THIS TEMPORARY REGULATION S GLOBAL NOTE WILL NOT BE EXCHANGEABLE
FOR INTERESTS IN THE RULE 144A GLOBAL NOTE OR THE PERMANENT
REGULATION S GLOBAL NOTE OR ANY OTHER NOTE REPRESENTING AN INTEREST IN THE
NOTES REPRESENTED HEREBY WHICH DO NOT CONTAIN A LEGEND CONTAINING RESTRICTIONS
ON TRANSFER, UNTIL THE EXPIRATION OF THE “40-DAY DISTRIBUTION COMPLIANCE PERIOD”
(WITHIN THE MEANING OF RULE 903 OF REGULATION S UNDER THE SECURITIES
ACT) AND THEN ONLY UPON CERTIFICATION IN FORM REASONABLY SATISFACTORY TO THE
TRUSTEE THAT SUCH BENEFICIAL INTERESTS ARE OWNED EITHER BY NON-U.S. PERSONS OR
U.S. PERSONS WHO PURCHASED SUCH INTERESTS IN A TRANSACTION THAT DID NOT REQUIRE
REGISTRATION UNDER THE SECURITIES ACT. 
DURING SUCH 40-DAY DISTRIBUTION COMPLIANCE PERIOD, BENEFICIAL OWNERSHIP
INTERESTS IN THIS TEMPORARY REGULATION S GLOBAL NOTE MAY ONLY BE SOLD,
PLEDGED OR TRANSFERRED THROUGH THE EUROCLEAR SYSTEM OR CLEARSTREAM BANKING,
S.A. AND ONLY (A)(1) TO A PERSON WHO THE SELLER REASONABLY BELIEVES IS A
QUALIFIED INSTITUTIONAL BUYER WITHIN THE MEANING OF RULE 144A UNDER

 

A-2

 

THE SECURITIES
ACT PURCHASING FOR ITS OWN ACCOUNT OR FOR THE ACCOUNT OF A QUALIFIED
INSTITUTIONAL BUYER IN A TRANSACTION MEETING THE REQUIREMENTS OF
RULE 144A, (2) IN AN OFFSHORE TRANSACTION COMPLYING WITH
RULE 903 OR RULE 904 OF REGULATION S UNDER THE SECURITIES ACT,
(3) TO AN INSTITUTIONAL ACCREDITED INVESTOR IN A TRANSACTION EXEMPT FROM
THE REGISTRATION REQUIREMENTS OF THE SECURITIES ACT, (4) PURSUANT TO AN
EXEMPTION FROM REGISTRATION UNDER THE SECURITIES ACT PROVIDED BY RULE 144
THEREUNDER (IF AVAILABLE) OR (5) PURSUANT TO AN EFFECTIVE REGISTRATION
STATEMENT UNDER THE SECURITIES ACT AND (B) IN ACCORDANCE WITH ALL
APPLICABLE SECURITIES LAWS OF THE STATES OF THE UNITED STATES.  HOLDERS OF INTERESTS IN THIS TEMPORARY
REGULATION S GLOBAL NOTE WILL NOTIFY ANY PURCHASER OF SUCH RESALE
RESTRICTIONS, IF THEN APPLICABLE.

 

[Definitive Note Legend]

 

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

 

A-3

 

COMPRESSION POLYMERS HOLDING CORPORATION

SENIOR FLOATING RATE NOTE DUE 2012

 

	
  CUSIP No.
                                

  
	
  No.
                 

  	
  $                                               

  

 

Interest Payment Dates: 
January 1 and July 1

Record Dates:  December 15 and
June 15

 

COMPRESSION POLYMERS HOLDING CORPORATION, a
Delaware corporation (the “Company,” which term includes any successor
corporation under the indenture hereinafter referred to), for value received
promises to pay to                                                                                                                                                                 ,
or registered assigns, the principal sum of                                                                
Dollars on July 1, 2012.

 

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

 

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

 

A-4

 

IN WITNESS WHEREOF, the Company has caused
this Note to be duly executed.

 

	
   

  	
  COMPRESSION POLYMERS HOLDING

        CORPORATION

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
   

  
	
   

  	
   

  	
  Name:

  
	
   

  	
   

  	
  Title:

  
	
  Dated:

  	
   

  
	
   

  	
   

  
	
  This is one of the Notes referred to

  in the within-mentioned Indenture:

  	
   

  
	
   

  	
   

  
	
  WELLS FARGO BANK, N.A.,

  	
   

  
	
      as Trustee

  	
   

  
	
   

  	
   

  
	
  By:

  	
   

  	
   

  	
   

  
	
   

  	
  Authorized Signatory

  	
   

  
					

 

A-5

 

(Back of Note)

Senior Floating Rate Notes due 2012

 

Capitalized terms used herein shall have the
meanings assigned to them in the Indenture referred to below unless otherwise
indicated.

 

(1)           (a)  Interest.  The Company promises to pay interest on the
principal amount of this Note at a rate per annum, reset semi-annually, equal
to the six-month LIBOR plus 6.75%, as determined by an agent appointed by the
Company (the “Calculation Agent”), which shall initially be the Trustee,
from July 5, 2005 until maturity.  The
Company will pay interest semi-annually on January 1 and July 1 of each year,
or if any such day is not a Business Day, on the next succeeding Business Day
(each an “Interest Payment Date”). 
Interest on the Note will accrue from the most recent date to which
interest has been paid or, if no interest has been paid, from the date of
issuance; provided that if there is no existing Default in the payment
of interest, and if this Note is authenticated between a record date referred
to on the face hereof and the next succeeding Interest Payment Date, interest
shall accrue from such next succeeding Interest Payment Date; provided, further,
that the first Interest Payment Date shall be January 1, 2006.  The Company shall pay interest (including
post-petition interest in any proceeding under any Bankruptcy Law) on overdue
payments of the principal, Purchase Price and Redemption Price of this Note
from time to time at the same rate per annum on the Notes to the extent lawful.  Interest will be computed on the basis of a
360-day year of twelve 30-day months.

 

“LIBOR,” with
respect to an Interest Period, will be the rate (expressed as a percentage per
annum) for deposits in United States dollars for six-month periods beginning on
the first day of such Interest Period that appears on Telerate Page 3750 as of
11:00 a.m., London time, on the Determination Date.  If Telerate Page 3750 does not include such a
rate or is unavailable on a Determination Date, the Calculation Agent will
request the principal London office of each of four major banks in the London
interbank market, as selected by the Calculation Agent, to provide such bank’s
offered quotation (expressed as a percentage per annum), as of approximately
11:00 a.m., London time, on such Determination Date, to prime banks in the London
interbank market for deposits in a Representative Amount in United States
dollars for a three-month period beginning on the first day of such Interest
Period.  If at least two such offered
quotations are so provided, LIBOR for the Interest Period will be the
arithmetic mean of such quotations.  If
fewer than two such quotations are so provided, the Calculation Agent will
request each of three major banks in New York City, as selected by the Calculation
Agent, to provide such bank’s rate (expressed as a percentage per annum), as of
approximately 11:00 a.m., New York City time, on such Determination Date, for
loans in a Representative Amount in United States dollars to leading European
banks for a six-month period beginning on the first day of such Interest
Period.  If at least two such rates are
so provided, LIBOR for the Interest Period will be the arithmetic mean of such
rates.  If fewer than two such rates are
so provided, then LIBOR for the Interest Period will be LIBOR in effect with
respect to the immediately preceding Interest Period.

 

“Interest Period”
means the period commencing on and including an Interest Payment Date and
ending on and including the day immediately preceding the next succeeding

 

A-6

 

Interest Payment Date; provided that the first Interest Period shall commence on
and include July 5, 2005 and end on and include December 31, 2005.

 

“Determination Date,”
with respect to an Interest Period, will be the second London Banking Day
preceding the first day of the Interest Period.

 

“London Banking Day”
is any day in which dealings in United States dollars are transacted or, with
respect to any future date, are expected to be transacted in the London interbank
market.

 

“Representative Amount”
means a principal amount of not less than $1,000,000 for a single transaction
in the relevant market at the relevant time.

 

“Telerate Page 3750”
means the display designated as “Page 3750” on the Moneyline Telerate service
(or such other page as may replace Page 3750 on that service).

 

(b)           Additional
Interest.  The Holder of this Note is
entitled to the benefits of a Registration Rights Agreement, dated July 5,
2005, between the Company, the Guarantors and the Initial Purchaser named
therein (the “Registration Rights Agreement”).  Capitalized terms used in this paragraph (b)
but not defined herein have the meanings assigned to them in the Registration
Rights Agreement.  Additional Interest,
if any, will be payable in cash semi-annually on the Interest Payment Date of
the Company’s choosing and in the amounts set forth in the Registration Rights
Agreement.  The Company shall pay
interest (including post-petition interest in any proceeding under any Bankruptcy
Law) on overdue installments of Additional Interest, if any, hereon from time
to time on demand at the same rate to the extent lawful.

 

(2)           Method
of Payment.  The Company will pay
interest on the Notes (except defaulted interest and Additional Interest), if
any, to the Persons who are registered Holders of Notes at the close of
business on the December 15 and June 15 next preceding the Interest Payment
Date, even if such Notes are canceled after such record date and on or before
such Interest Payment Date, except as provided in Section 2.12 of the
Indenture with respect to defaulted interest. 
Any such installment of interest not punctually paid or duly provided
for shall forthwith cease to be payable to the registered Holders on such
Interest Payment Date, and may be paid to the registered Holders at the close
of business on a special interest payment date to be fixed by the Trustee for
the payment of such defaulted interest, notice whereof shall be given to the
registered Holders not less than 10 days prior to such special interest
payment date, or may be paid at any time in any other lawful manner not inconsistent
with the requirements of any securities exchange on which the Notes may be
listed, and upon such notice as may be required by such exchange, all as more
fully provided in the Indenture.  The
Notes will be payable as to principal, Redemption Price, Purchase Price,
interest and Additional Interest, if any, at the office or agency of the
Company maintained for such purpose within or without the City and State of
New York, or, at the option of the Company.  Payment of interest and Additional Interest
may be made by check mailed to the Holders at their addresses set forth in the
register of Holders, provided that payment by wire transfer of immediately
available funds will be required with respect to principal, Redemption Price
and Purchase Price of, and interest and Additional Interest (if any) on, all
Global Notes and all other Notes the Holders of which shall have provided wire
transfer instructions to the Trustee or the Paying Agent ten Business Days
prior to the Record

 

A-7

 

Date.  Such payment shall be in such coin or
currency of the United States of America as at the time of payment is legal
tender for payment of public and private debts.

 

(3)           Paying
Agent and Registrar.  Initially,
Wells Fargo Bank, N.A., the Trustee under the Indenture, will act as Paying
Agent and Registrar.  The Company may
change any Paying Agent or Registrar without notice to any Holder.  The Company or a domestically incorporated
wholly-owned subsidiary may act in any such capacity.

 

(4)           Indenture
and Guarantees.  The Company issued
the Notes under an Indenture dated as of July 5, 2005 (as in effect from time
to time, the “Indenture”) among the Company, the Guarantors party
thereto from time to time and the Trustee. 
The terms of the Notes include those stated in the Indenture and those
made part of the Indenture by reference to the Trust Indenture Act of 1939, as
amended (15 U.S.C. Code §§ 77aaa-77bbbb). 
The Notes are subject to all such terms, and Holders are referred to the
Indenture and such Act for a statement of such terms.  The Notes are general obligations of the
Company.  If any of the terms or provisions
contained in this Note conflict with any of the terms or provisions of the
Indenture, those contained in the Indenture shall govern and be controlling.

 

(5)           Optional
Redemption.  (a)  The
Company may redeem the Notes, at the Company’s option, in whole at any time, or
in part from time to time, on and after July 1, 2007, upon not less than
30 nor more than 60 days’ notice at the following Redemption Prices (expressed
as a percentage of the principal amount thereof), if redeemed during the
12-month period commencing on July 1 of the year set forth below, plus, in
each case, accrued and unpaid interest thereon, if any, to the date of
redemption:

 

	
  Year

  	
   

  	
  Percentage

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  2007

  	
   

  	
  103.000

  	
  %

  
	
  2008

  	
   

  	
  102.000

  	
  %

  
	
  2009 and thereafter

  	
   

  	
  100.000

  	
  %

  

 

If less than all the Notes are to be
redeemed, the Trustee will select the particular Notes or portions thereof to
be redeemed by lot, pro rata or by
any other method the Trustee shall deem fair and reasonable.

 

(b)           Before
July 1, 2007, the Company may also redeem the Notes, as a whole but not in
part, upon not less than 30 nor more than 60 days’ prior notice, at a
redemption price equal to 100% of the principal amount thereof plus the
Applicable Premium as of, and accrued and unpaid interest thereon, if any, to,
the date of redemption.

 

“Applicable Premium” means, with
respect to any Note on any redemption date, the greater of (i) 1.0% of the
principal amount of such Note and (ii) the excess of (A) the present
value at such redemption date of (1) the redemption price of such Note at
July 1, 2007 (as set forth in the table above), plus (2) all
scheduled interest payments due on such Note from the redemption date through
July 1, 2007 (excluding accrued but unpaid interest to the redemption
date), computed using a discount rate equal to the Treasury Rate at such
redemption date, plus 50 basis points over (B) the principal amount of
such Note.

 

A-8

 

“Treasury Rate” means, with respect to
any redemption date, the yield to maturity at the time of computation of United
States Treasury securities with a constant maturity (as compiled and published
in the most recent Federal Reserve Statistical Release H.15(519) that has become
publicly available at least two business days prior to such redemption date
(or, if such Statistical Release is no longer published, any publicly available
source of similar market data)) most nearly equal to the period from such
redemption date to July 1, 2007; provided, however, that if
the period from such redemption date to July 1, 2007 is not equal to the
constant maturity of a United States Treasury security for which a weekly
average yield is given, the Treasury Rate shall be obtained by linear
interpolation (calculated to the nearest one-twelfth of a year) from the weekly
average yields of United States Treasury securities for which such yields are
given, except that if the period from such redemption date to July 1, 2007
is less than one year, the weekly average yield on actually traded United
States Treasury securities adjusted to a constant maturity of one year shall be
used.

 

(6)           Optional
Redemption upon Public Equity Offerings. 
At any time, or from time to time, on or prior to July 1, 2007, the
Company may, at its option, use the net cash proceeds of one or more Equity
Offerings to redeem up to 35% of the Notes issued under the Indenture at a
redemption price equal to 100% of the principal amount thereof plus a premium
equal to the interest rate per annum on the Note applicable on the date on
which notice of the redemption is given, plus accrued and unpaid interest and
Additional Interest (if any), to the date of redemption, provided that
at least 65% of the principal amount of Notes issued under the Indenture
remains outstanding immediately after any such redemption; and provided,
further, that the Company shall make such redemption not more than
120 days after the consummation of any such Equity Offering.  If less than all the Notes are to be
redeemed, the Trustee will select the particular Notes or portions thereof to
be redeemed by lot, only on a pro rata basis
or on as nearly a pro rata basis as is practicable
(subject to DTC procedures, unless such method is otherwise prohibited).

 

(7)           Mandatory
Redemption.  Except as set forth in
Paragraph 9 below with respect to repurchases of Notes in certain events, the
Company shall not be required to make mandatory redemption payments with
respect to the Notes.

 

(8)           Notice
of Redemption.  Subject to the
provisions of the Indenture, a notice of redemption will be mailed at least
30 days but not more than 60 days (or in the case of a Change of
Control Offer, at least 30 days but not more than 60 days, or in the case
of a Net Proceeds Offer, within 30 days) before the applicable redemption date
to each Holder whose Notes are to be redeemed at its registered address.  Notes in denominations larger than $1,000 may
be redeemed in part but only in whole multiples of $1,000, unless all of the
Notes held by a Holder are to be redeemed. 
On and after the redemption date interest ceases to accrue on Notes or
portions thereof called for redemption.

 

(9)           Repurchase
at Option of Holder.  (a)  If there is a Change of Control, the Company
shall be required to make an offer to repurchase all or any part (equal to
$1,000 or an integral multiple thereof) of each Holder’s Notes at a Purchase
Price equal to 101% of the principal amount thereof plus accrued and
unpaid interest and Additional Interest, if any, to the date of repurchase, in
accordance with the procedures set forth in the Indenture.

 

A-9

 

(b)           Under
certain circumstances described in the Indenture, the Company will be required
to apply the proceeds of Asset Sales to the repayment of the Notes and/or Pari
Passu Indebtedness.

 

(10)         Denominations,
Transfer, Exchange.  The Notes are in
registered form without coupons in denominations of $1,000 and integral
multiples of $1,000.  The transfer of
Notes may be registered and Notes may be exchanged as provided in the
Indenture.  The Registrar and the Trustee
may require a Holder, among other things, to furnish appropriate endorsements
and transfer documents and the Company may require a Holder to pay any taxes
and fees required by law or permitted by the Indenture.  The Company need not exchange or register the
transfer of any Note or portion of a Note selected for redemption, except for
the unredeemed portion of any Note being redeemed in part, or any Note that has
been tendered in a Change of Control Offer or a Net Proceeds Offer.  Also, it need not exchange or register the
transfer of any Notes for a period of 15 days before the mailing of a
notice of redemption of Notes to be redeemed or during the period between a
record date and the corresponding Interest Payment Date.

 

(11)         Persons
Deemed Owners.  The registered Holder
of a Note may be treated as its owner for all purposes.

 

(12)         Amendment,
Supplement and Waiver.  The Indenture
or the Notes may be amended or supplemented only as provided in the Indenture.

 

(13)         Defaults
and Remedies.  Events of Default include:  (i) the failure to pay interest on any
Note when the same becomes due and payable and the default continues for a
period of 30 days; (ii) the failure to pay the principal on any Note, when
such principal becomes due and payable, at maturity, upon redemption or
otherwise (including the failure to make a payment to purchase Notes tendered
pursuant to a Change of Control Offer or a Net Proceeds Offer) on the date
specified for such payment in the applicable offer to purchase; (iii) a
default in the observance or performance of any covenant or agreement contained
in the Indenture which default continues for a period of 60 days after the
Company received written notice specifying the default (and demanding that such
default be remedied) from the Trustee or the Holders of at least 25% of the
outstanding principal amount of the Notes (except in the case of a default with
respect to Section 5.1 of the Indenture, which will constitute an Event of
Default with such notice requirement but without such passage of time
requirement); (iv) the failure to pay at final maturity (giving effect to
any applicable grace periods and any extensions thereof) the principal amount
of any Indebtedness of the Company or any Restricted Subsidiary, or the
acceleration of the final stated maturity of any such Indebtedness, if the
aggregate principal amount of such Indebtedness, together with the principal
amount of any other such Indebtedness in default for failure to pay principal
at final stated maturity or which has been accelerated, aggregates $15.0
million or more at any time; (v) one or more judgments in an aggregate
amount in excess of $15.0 million (to the extent not covered by insurance or
bonded) shall have been rendered against the Company or any of its Significant
Subsidiaries and such judgments remain undischarged, unpaid or unstayed for a
period of 60 days after such judgment or judgments become final and
non-appealable; (vi) certain events of bankruptcy affecting the Company or
any of its Significant Subsidiaries, as specified in the Indenture; and (vii)
any Guarantee of Holdings or a Significant Subsidiary required pursuant to the
Indenture ceases to be in full force

 

A-10

 

and effect or
is declared to be null and void and unenforceable or is found to be invalid or
a Guarantor that is a Significant Subsidiary denies its liability in writing
under its Guarantee required pursuant to the Indenture (other than by reason of
release of a Guarantor in accordance with the terms of the Indenture).  If any Event of Default (other than an Event
of Default specified in clause (vi) above relating to the Company) shall occur
and be continuing, the Trustee or the Holders of at least 25% in principal amount
of outstanding Notes may declare the principal of and accrued interest on all
the Notes to be due and payable by notice in
writing to the Company and the Trustee specifying the respective Event of
Default and that it is a “notice of acceleration” and the same shall become
immediately due and payable.  If an Event
of Default specified in clause (vi) above relating to the Company occurs and is
continuing, then all unpaid principal of, and premium, if any, and accrued and
unpaid interest on all of the outstanding Notes shall ipso facto become and be immediately due
and payable without any declaration or other act on the part of the Trustee or
any Holder. Holders may not enforce the Indenture or the Notes except as
provided in the Indenture and under the TIA. 
Subject to certain limitations, Holders of a majority in principal
amount of the then outstanding Notes may direct the Trustee in its exercise of
any trust or power. The Holders of a majority in principal amount of the then
outstanding Notes may, by Notice to the Trustee on behalf of the Holders of all
of the Notes, waive any existing Default under the Indenture, and its
consequences, except a default in the payment of the principal of or interest
or Additional Interest, if any, on any Notes. 
The Company is required to deliver to the Trustee annually a statement
regarding compliance with the Indenture. In addition, the Company shall, so
long as any of the Notes are outstanding, deliver to the Trustee, within five
Business Days after any Officer of the Company obtains knowledge of any Default
or Event of Default, an Officer’s Certificate specifying such Default or Event
of Default.

 

(14)         Trustee
Dealings with Company.  Subject to certain limitations, the Trustee
under the Indenture, in its individual or any other capacity, may become owner
or pledge of Notes and may otherwise deal with the Company or its Affiliates as
if it were not Trustee.

 

(15)         No
Recourse Against Others.  No past,
present or future director, officer, employee, incorporator, agent or stockholder
or Affiliate of the Company, as such, shall have any liability for any
obligations of the Company under the Notes, the Indenture or the Registration
Rights Agreement or for any claim based on, in respect of, or by reason of,
such obligations or their creation.  No
past, present or future director, officer, employee, incorporator, agent or
stockholder or Affiliate of any of the Guarantors, as such, shall have any liability
for any obligations of the Guarantors under the Guarantees, the Indenture or
the Registration Rights Agreement or for any claim based on, in respect of, or
by reason of, such obligations or their creation.  Each Holder of Notes and Guarantees by
accepting a Note and a Guarantee waives and releases all such liabilities.  The waiver and release are part of the
consideration for issuance of the Notes and the Guarantees.

 

(16)         Authentication.  This Note shall not be valid until
authenticated by the manual signature of the Trustee or an authenticating
agent.

 

(17)         Abbreviations.  Customary abbreviations may be used in the
name of a Holder or an assignee, such as: 
TEN COM (= tenants in common), TEN ENT (= tenants by the

 

A-11

 

entireties),
JT TEN (= joint tenants with right of survivorship and not as tenants in common),
CUST (= Custodian), and U/G/M/A (= Uniform Gifts to Minors Act).

 

(18)         Discharge
and Defeasance.  If the Company
deposits, in accordance with the Indenture, with the Trustee or Paying Agent
cash or U.S. Government Obligations sufficient to pay the principal or Redemption
Price of, and interest and Additional Interest, if any, on, the Notes to
maturity or a specified Redemption Date and satisfies certain conditions
specified in the Indenture, the Company will be discharged from the Indenture,
except for certain Sections thereof.

 

(19)         Governing
Law.  The Indenture and this Note
shall be governed by and construed in accordance with the laws of the State of
New York.

 

(20)         CUSIP
Numbers.  Pursuant to a
recommendation promulgated by the Committee on Uniform Security Identification
Procedures, the Company has caused CUSIP numbers to be printed on the Notes and
the Trustee may use CUSIP numbers in notices of redemption as a convenience to
Holders.  No representation is made as to
the correctness or accuracy of such numbers either as printed on the Notes or
as contained in any notice of redemption or repurchase and reliance may be
placed only on the other identification numbers placed thereon.

 

(21)         Registration
Rights.  Pursuant to the Registration
Rights Agreement, the Company will be obligated upon the occurrence of certain
events to consummate an exchange offer pursuant to which the Holder of this
Note shall have the right to exchange this Initial Floating Rate Note for the
Company’s Exchange Floating Rate Notes, which have been registered under the
Securities Act, in like principal amount and having terms identical in all material
respects to the Initial Floating Rate Notes. 
The Holders shall be entitled to receive certain additional interest
payments in the event such exchange offer is not consummated and upon certain
other conditions, all pursuant to and in accordance with the terms of the
Registration Rights Agreement.

 

(22)         Request
for Indenture.  The Company will
furnish to any Holder upon written request and without charge a copy of the
Indenture.  Request may be made to:

 

Compression Polymers Holding Corporation

801 Corey St.

Moosic, PA  18507

Attention:  Chief Financial Officer

 

A-12

 

ASSIGNMENT FORM

 

To assign this Note, fill in the form below:

 

I or we assign and transfer this Note to

 

 

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

 

 

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

 

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

 

	
  Date: 

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
  Your Signature:

  	
   

  	
   

  	
   

  	
   

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

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
  Signature Guarantee:

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
  Date: 

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
  Signature of Signature Guarantee

  
									

 

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

 

A-13

 

OPTION OF HOLDER TO ELECT PURCHASE

 

If you wish to elect to have all or any
portion of this Note purchased by the Company pursuant to Section 4.10
(“Net Proceeds Offer”) or Section 4.15 (“Change of Control Offer”) of the
Indenture, check the applicable boxes

 

	
   

  	
  o

  	
  Net Proceeds
  Offer:

  	
  o

  	
  Change of
  Control Offer:

  
	
   

  
	
   

  	
  in whole

  	
  o

  	
  in whole

  	
  o

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
  in part

  	
  o

  	
  in part

  	
  o

  
	
   

  
	
   

  	
  Amount to be

  	
  Amount to be

  
	
   

  	
  purchased: $                       

  	
  purchased: $

  
	
   

  
	
   

  	
  Date: 

  	
   

  	
   

  
	
   

  
	
   

  	
  Your
  Signature:

  	
   

  	
   

  
	
   

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

  
	
   

  
	
   

  	
  Date:

  	
   

  	
   

  
	
   

  	
  Signature
  Guarantee:

  	
   

  
	
   

  
	
   

  	
  Signature
  must be guaranteed by a participant in a recognized signature guaranty

  medallion program or other signature guarantor acceptable to the Trustee.

  
	
   

  
	
   

  	
  Social
  Security Number or

  
	
   

  	
  Taxpayer
  Identification Number:

  
												

 

A-14

 

EXHIBIT B

FORM OF INITIAL FIXED RATE NOTE

(Face of Note)

COMPRESSION POLYMERS HOLDING CORPORATION

101⁄2% SENIOR NOTE DUE 2013

 

[THIS NOTE IS
A GLOBAL NOTE WITHIN THE MEANING OF THE INDENTURE HEREINAFTER REFERRED TO AND
IS REGISTERED IN THE NAME OF A DEPOSITARY OR A NOMINEE OF A DEPOSITARY OR A
SUCCESSOR DEPOSITARY.  THIS NOTE IS NOT
EXCHANGEABLE FOR NOTES REGISTERED IN THE NAME OF A PERSON OTHER THAN THE
DEPOSITARY OR ITS NOMINEE EXCEPT IN THE LIMITED CIRCUMSTANCES DESCRIBED IN THE
INDENTURE, AND NO TRANSFER OF THIS NOTE (OTHER THAN A TRANSFER OF THIS NOTE AS
A WHOLE BY THE DEPOSITARY TO A NOMINEE OF THE DEPOSITARY OR BY A NOMINEE OF THE
DEPOSITARY TO THE DEPOSITARY OR ANOTHER NOMINEE OF THE DEPOSITARY) MAY BE
REGISTERED EXCEPT IN THE LIMITED CIRCUMSTANCES DESCRIBED IN THE INDENTURE.

 

UNLESS THIS
CERTIFICATE IS PRESENTED BY AN AUTHORIZED REPRESENTATIVE OF THE DEPOSITORY
TRUST COMPANY, A NEW YORK CORPORATION (“DTC”), TO THE COMPANY OR ITS AGENT FOR
REGISTRATION OF TRANSFER, EXCHANGE, OR PAYMENT, AND ANY CERTIFICATE ISSUED IS
REGISTERED IN THE NAME OF CEDE & CO. OR IN SUCH OTHER NAME AS IS REQUESTED
BY AN AUTHORIZED REPRESENTATIVE OF DTC (AND ANY PAYMENT IS MADE TO CEDE &
CO. OR TO SUCH OTHER ENTITY AS IS REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF
DTC), ANY TRANSFER, PLEDGE OR OTHER USE HEREOF FOR VALUE OR OTHERWISE BY OR TO
ANY PERSON IS WRONGFUL INASMUCH AS THE REGISTERED OWNER HEREOF, CEDE & CO.,
HAS AN INTEREST HEREIN.](2)

 

THIS NOTE (OR ITS PREDECESSOR) EVIDENCED HEREBY WAS ORIGINALLY ISSUED
IN A TRANSACTION EXEMPT FROM REGISTRATION UNDER SECTION 5 OF THE UNITED
STATES SECURITIES ACT OF 1933, AS AMENDED (THE “SECURITIES ACT”).  THIS NOTE HAS NOT BEEN REGISTERED UNDER THE
SECURITIES ACT, AND ACCORDINGLY, MAY NOT BE OFFERED, SOLD, PLEDGED OR OTHERWISE
TRANSFERRED EXCEPT PURSUANT TO AN EFFECTIVE REGISTRATION STATEMENT UNDER, OR AN
EXEMPTION FROM THE REGISTRATION REQUIREMENTS OF, THE SECURITIES ACT, IN
ACCORDANCE WITH ANY

 

(2)           To be included only if
the Note is issued in global form

 

B-1

 

APPLICABLE SECURITIES LAWS OF ANY STATE OF THE UNITED STATES OR ANY
OTHER JURISDICTION AND IN ACCORDANCE WITH TRANSFER RESTRICTIONS CONTAINED IN
THE INDENTURE UNDER WHICH THIS NOTE WAS ISSUED AND THE OFFERING MEMORANDUM
PURSUANT TO WHICH THIS NOTE WAS ORIGINALLY SOLD.  THE HOLDER OF THE NOTE WILL, AND EACH
SUBSEQUENT HOLDER IS REQUIRED TO, NOTIFY A PROPOSED TRANSFEREE OF THE NOTICE OF
THE RESALE RESTRICTIONS APPLICABLE TO THE NOTE.

 

THIS SECURITY MAY NOT BE ACQUIRED OR HELD WITH THE ASSETS OF
(I) AN “EMPLOYEE BENEFIT PLAN” (AS DEFINED IN THE EMPLOYEE RETIREMENT INCOME
SECURITY ACT OF 1974, AS AMENDED (“ERISA”)) THAT IS SUBJECT TO ERISA,
(II) A “PLAN” DESCRIBED IN SECTION 4975 OF THE INTERNAL REVENUE CODE
OF 1986, AS AMENDED (THE “CODE”), (III) ANY ENTITY DEEMED TO HOLD “PLAN
ASSETS” OF ANY OF THE FOREGOING BY REASON OF AN EMPLOYEE BENEFIT PLAN’S OR
PLAN’S INVESTMENT IN SUCH ENTITY, OR (IV) A GOVERNMENTAL PLAN OR CHURCH
PLAN SUBJECT TO APPLICABLE LAW THAT IS SUBSTANTIALLY SIMILAR TO THE FIDUCIARY
RESPONSIBILITY OR PROHIBITED TRANSACTION PROVISIONS OF ERISA OR
SECTION 4975 OF THE CODE (“SIMILAR LAW”), UNLESS THE ACQUISITION AND
HOLDING OF THIS SECURITY BY THE PURCHASER OR TRANSFEREE, THROUGHOUT THE PERIOD
THAT IT HOLDS THIS SECURITY, ARE EXEMPT FROM THE PROHIBITED TRANSACTION
RESTRICTIONS UNDER ERISA AND/OR SECTION 4975 OF THE CODE OR UNDER ANY
PROVISIONS OF SIMILAR LAW, AS APPLICABLE, PURSUANT TO ONE OR MORE PROHIBITED
TRANSACTION STATUTORY OR ADMINISTRATIVE EXEMPTIONS.  BY ITS ACQUISITION OR HOLDING OF THIS
SECURITY, EACH PURCHASER AND TRANSFEREE WILL BE DEEMED TO HAVE REPRESENTED AND
WARRANTED THAT THE FOREGOING REQUIREMENTS HAVE BEEN SATISFIED.

 

[Temporary Regulation S Global Note Legend]

 

BENEFICIAL
OWNERSHIP INTERESTS IN THIS TEMPORARY REGULATION S GLOBAL NOTE WILL NOT BE
EXCHANGEABLE FOR INTERESTS IN THE RULE 144A GLOBAL NOTE OR THE PERMANENT
REGULATION S GLOBAL NOTE OR ANY OTHER NOTE REPRESENTING AN INTEREST IN THE
NOTES REPRESENTED HEREBY WHICH DO NOT CONTAIN A LEGEND CONTAINING RESTRICTIONS
ON TRANSFER, UNTIL THE EXPIRATION OF THE “40-DAY DISTRIBUTION COMPLIANCE
PERIOD” (WITHIN THE MEANING OF RULE 903 OF REGULATION S UNDER THE
SECURITIES ACT) AND THEN ONLY UPON CERTIFICATION IN FORM REASONABLY SATISFACTORY
TO THE TRUSTEE THAT SUCH BENEFICIAL INTERESTS ARE OWNED EITHER BY NON-U.S.
PERSONS OR U.S. PERSONS WHO PURCHASED SUCH INTERESTS IN A TRANSACTION THAT DID
NOT REQUIRE REGISTRATION UNDER THE SECURITIES ACT.  DURING SUCH 40-DAY DISTRIBUTION COMPLIANCE
PERIOD, BENEFICIAL OWNERSHIP INTERESTS IN THIS TEMPORARY REGULATION S
GLOBAL NOTE MAY ONLY BE SOLD, PLEDGED OR TRANSFERRED THROUGH THE EUROCLEAR SYSTEM
OR CLEARSTREAM BANKING, S.A. AND ONLY (A)(1) TO A PERSON WHO THE SELLER
REASONABLY BELIEVES IS A QUALIFIED INSTITUTIONAL BUYER WITHIN THE MEANING OF
RULE 144A UNDER

 

B-2

 

THE SECURITIES
ACT PURCHASING FOR ITS OWN ACCOUNT OR FOR THE ACCOUNT OF A QUALIFIED
INSTITUTIONAL BUYER IN A TRANSACTION MEETING THE REQUIREMENTS OF
RULE 144A, (2) IN AN OFFSHORE TRANSACTION COMPLYING WITH
RULE 903 OR RULE 904 OF REGULATION S UNDER THE SECURITIES ACT,
(3) TO AN INSTITUTIONAL ACCREDITED INVESTOR IN A TRANSACTION EXEMPT FROM
THE REGISTRATION REQUIREMENTS OF THE SECURITIES ACT, (4) PURSUANT TO AN
EXEMPTION FROM REGISTRATION UNDER THE SECURITIES ACT PROVIDED BY RULE 144
THEREUNDER (IF AVAILABLE) OR (5) PURSUANT TO AN EFFECTIVE REGISTRATION STATEMENT
UNDER THE SECURITIES ACT AND (B) IN ACCORDANCE WITH ALL APPLICABLE SECURITIES
LAWS OF THE STATES OF THE UNITED STATES. 
HOLDERS OF INTERESTS IN THIS TEMPORARY REGULATION S GLOBAL NOTE
WILL NOTIFY ANY PURCHASER OF SUCH RESALE RESTRICTIONS, IF THEN APPLICABLE.

 

[Definitive Note Legend]

 

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

 

B-3

 

COMPRESSION POLYMERS HOLDING CORPORATION

 

101⁄2% SENIOR NOTE DUE 2013

 

	
  CUSIP No.
                                

  
	
  No.
                 

  	
  $                                               

  

 

Interest Payment Dates:  January 1 and July 1 

Record Dates:  December 15 and June 15

 

COMPRESSION POLYMERS HOLDING CORPORATION, a
Delaware corporation (the “Company,” which term includes any successor
corporation under the indenture hereinafter referred to), for value received
promises to pay to                                                                                                                                                                        ,
or registered assigns, the principal sum of                                               
Dollars on July 1, 2013.

 

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

 

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

 

B-4

 

IN WITNESS WHEREOF, the Company has caused
this Note to be duly executed.

 

	
   

  	
  COMPRESSION POLYMERS HOLDING

  CORPORATION

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
   

  
	
   

  	
   

  	
  Name:

  
	
   

  	
   

  	
  Title:

  
	
   

  	
   

  	
   

  
	
  Dated:

  	
   

  
	
   

  	
   

  
	
  This is one of the Notes referred to

  in the within-mentioned Indenture:

  	
   

  
	
   

  	
   

  
	
  WELLS FARGO BANK, N.A.,

  	
   

  
	
      as Trustee

  	
   

  
	
   

  	
   

  
	
  By:

  	
   

  	
   

  	
   

  
	
   

  	
  Authorized Signatory

  	
   

  
					

 

B-5

 

(Reverse of Note)

 

10 1⁄2% Senior Notes due 2013

 

Capitalized terms used herein shall have the
meanings assigned to them in the Indenture referred to below unless otherwise
indicated.

 

(1)           (a)  Interest.  The Company promises to pay interest on the
principal amount of this Note at the rate of 101⁄2% per annum from July 5, 2005
until maturity.  The Company will pay
interest semi-annually on January 1 and July 1 of each year, or if
any such day is not a Business Day, on the next succeeding Business Day (each
an “Interest Payment Date”).  Interest
on the Note will accrue from the most recent date to which interest has been
paid or, if no interest has been paid, from the date of issuance; provided
that if there is no existing Default in the payment of interest, and if this
Note is authenticated between a record date referred to on the face hereof and
the next succeeding Interest Payment Date, interest shall accrue from such next
succeeding Interest Payment Date; provided, further, that the
first Interest Payment Date shall be January 1, 2006.  The Company shall pay interest (including
post-petition interest in any proceeding under any Bankruptcy Law) on overdue
payments of the principal, Purchase Price and Redemption Price of this Note
from time to time at the same rate per annum on the Notes to the extent
lawful.  Interest will be computed on the
basis of a 360-day year of twelve 30-day months.

 

(b)           Additional
Interest.  The Holder of this Note is
entitled to the benefits of a Registration Rights Agreement, dated July 5,
2005, between the Company and the Initial Purchaser named therein (the “Registration
Rights Agreement”).  Capitalized
terms used in this paragraph (b) but not defined herein have the meanings
assigned to them in the Registration Rights Agreement.  Additional Interest will be payable in cash
semi-annually on the Interest Payment Date of the Company’s choosing and in the
amounts set forth in the Registration Rights Agreement.  The Company shall pay interest (including
post-petition interest in any proceeding under any Bankruptcy Law) on overdue
installments of Additional Interest, if any, hereon from time to time on demand
at the same rate to the extent lawful.

 

(2)           Method
of Payment.  The Company will pay
interest on the Notes (except defaulted interest and Additional Interest), if
any, to the Persons who are registered Holders of Notes at the close of
business on the December 15 and June 15 next preceding the Interest
Payment Date, even if such Notes are canceled after such record date and on or
before such Interest Payment Date, except as provided in Section 2.12 of
the Indenture with respect to defaulted interest.  Any such installment of interest not
punctually paid or duly provided for shall forthwith cease to be payable to the
registered Holders on such Interest Payment Date, and may be paid to the
registered Holders at the close of business on a special interest payment date
to be fixed by the Trustee for the payment of such defaulted interest, notice
whereof shall be given to the registered Holders not less than 10 days
prior to such special interest payment date, or may be paid at any time in any
other lawful manner not inconsistent with the requirements of any securities
exchange on which the Notes may be listed, and upon such notice as may be
required by such exchange, all as more fully provided in the Indenture.  The Notes will be payable as to principal,
Redemption Price, Purchase Price, interest and Additional Interest, if any, at
the office or agency of the Company maintained for such purpose within or
without the City and State of

 

B-6

 

New York,
or, at the option of the Company. 
Payment of interest and Additional Interest may be made by check mailed
to the Holders at their addresses set forth in the register of Holders, provided
that payment by wire transfer of immediately available funds will be required
with respect to principal, Redemption Price and Purchase Price of, and interest
and Additional Interest (if any) on, all Global Notes and all other Notes the
Holders of which shall have provided wire transfer instructions to the Trustee
or the Paying Agent ten days prior to the Record Date.  Such payment shall be in such coin or
currency of the United States of America as at the time of payment is legal
tender for payment of public and private debts.

 

(3)           Paying
Agent and Registrar.  Initially,
Wells Fargo Bank, N.A., the Trustee under the Indenture, will act as Paying
Agent and Registrar.  The Company may
change any Paying Agent or Registrar without notice to any Holder.  The Company or a domestically incorporated
wholly-owned subsidiary may act in any such capacity.

 

(4)           Indenture
and Guarantees.  The Company issued
the Notes under an Indenture dated as of July 5, 2005 (as in effect from time
to time, the “Indenture”) among the Company, the Guarantors party
thereto from time to time and the Trustee. 
The terms of the Notes include those stated in the Indenture and those
made part of the Indenture by reference to the Trust Indenture Act of 1939, as
amended (15 U.S.C. Code §§ 77aaa-77bbbb). 
The Notes are subject to all such terms, and Holders are referred to the
Indenture and such Act for a statement of such terms.  The Notes are general obligations of the Company.  If any of the terms or provisions contained
in this Note conflicts with any of the terms or provisions of the Indenture,
those contained in the Indenture shall govern and be controlling.

 

(5)           Optional
Redemption.  (a)  The
Company may redeem the Notes, at the Company’s option, in whole at any time, or
in part from time to time, on and after July 1, 2009, upon not less than
30 nor more than 60 days’ notice at the following Redemption Prices (expressed
as a percentage of the principal amount thereof), if redeemed during the
12-month period commencing on July 1 of the year set forth below, plus, in
each case, accrued and unpaid interest thereon, if any, to the date of
redemption:

 

	
  Year

  	
   

  	
  Percentage

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  2009

  	
   

  	
  105.250

  	
  %

  
	
  2010

  	
   

  	
  102.625

  	
  %

  
	
  2011 and thereafter

  	
   

  	
  100.000

  	
  %

  

 

If less than all the Notes are to be
redeemed, the Trustee will select the particular Notes or portions thereof to
be redeemed by lot, pro rata or by
any other method the Trustee shall deem fair and reasonable.

 

(b)           Before
July 1, 2009, the Company may also redeem the Notes, as a whole but not in
part, upon not less than 30 nor more than 60 days’ prior notice, at a
redemption price equal to 100% of the principal amount thereof plus the
Applicable Premium as of, and accrued and unpaid interest thereon, if any, to,
the date of redemption.

 

B-7

 

“Applicable Premium” means, with
respect to any Note on any redemption date, the greater of (i) 1.0% of the
principal amount of such Note and (ii) the excess of (A) the present
value at such redemption date of (1) the redemption price of such Note at
July 1, 2009 (as set forth in the table above), plus (2) all
scheduled interest payments due on such Note from the redemption date through
July 1, 2009 (excluding accrued but unpaid interest to the redemption
date), computed using a discount rate equal to the Treasury Rate at such
redemption date, plus 50 basis points over (B) the principal amount of
such Note.

 

“Treasury Rate” means, with respect to
any redemption date, the yield to maturity at the time of computation of United
States Treasury securities with a constant maturity (as compiled and published
in the most recent Federal Reserve Statistical Release H.15(519) that has become
publicly available at least two business days prior to such redemption date
(or, if such Statistical Release is no longer published, any publicly available
source of similar market data)) most nearly equal to the period from such
redemption date to July 1, 2009; provided, however, that if
the period from such redemption date to July 1, 2009 is not equal to the
constant maturity of a United States Treasury security for which a weekly
average yield is given, the Treasury Rate shall be obtained by linear
interpolation (calculated to the nearest one-twelfth of a year) from the weekly
average yields of United States Treasury securities for which such yields are
given, except that if the period from such redemption date to July 1, 2009
is less than one year, the weekly average yield on actually traded United
States Treasury securities adjusted to a constant maturity of one year shall be
used.

 

(6)           Optional
Redemption upon Public Equity Offerings. 
At any time, or from time to time, on or prior to July 1, 2008, the
Company may, at its option, use the net cash proceeds of one or more Equity
Offerings to redeem up to 35% of the Notes issued under the Indenture at a
redemption price equal to 110.50% of the principal amount thereof, plus accrued
and unpaid interest and Additional Interest (if any), to the date of
redemption, provided that at least 65% of the principal amount of Notes
issued under the Indenture remains outstanding immediately after any such
redemption; and provided, further, that the Company shall make
such redemption not more than 120 days after the consummation of any such
Equity Offering.  If less than all the
Notes are to be redeemed, the Trustee will select the particular Notes or
portions thereof to be redeemed by lot, only on a pro rata
basis or on as nearly a pro rata basis
as is practicable (subject to DTC procedures, unless such method is otherwise
prohibited).

 

(7)           Mandatory
Redemption.  Except as set forth in
Paragraph 9 below with respect to repurchases of Notes in certain events, the
Company shall not be required to make mandatory redemption payments with
respect to the Notes.

 

(8)           Notice
of Redemption.  Subject to the
provisions of the Indenture, a notice of redemption will be mailed at least
30 days but not more than 60 days (or in the case of a Change of
Control Offer, at least 30 days but not more than 60 days, or in the case
of a Net Proceeds Offer, within 30 days) before the applicable redemption date
to each Holder whose Notes are to be redeemed at its registered address.  Notes in denominations larger than $1,000 may
be redeemed in part but only in whole multiples of $1,000, unless all of the
Notes held by a Holder are to be redeemed. 
On and after the redemption date interest ceases to accrue on Notes or
portions thereof called for redemption.

 

B-8

 

(9)           Repurchase
at Option of Holder.  (a)  If there is a Change of Control, the Company
shall be required to make an offer to repurchase all or any part (equal to
$1,000 or an integral multiple thereof) of each Holder’s Notes at a Purchase
Price equal to 101% of the principal amount thereof plus accrued and
unpaid interest and Additional Interest, if any, to the date of repurchase, in
accordance with the procedures set forth in the Indenture.

 

(b)           Under
certain circumstances described in the Indenture, the Company will be required
to apply the proceeds of Asset Sales to the repayment of the Notes and/or Pari
Passu Indebtedness.

 

(10)         Denominations,
Transfer, Exchange.  The Notes are in
registered form without coupons in denominations of $1,000 and integral
multiples of $1,000.  The transfer of
Notes may be registered and Notes may be exchanged as provided in the
Indenture.  The Registrar and the Trustee
may require a Holder, among other things, to furnish appropriate endorsements
and transfer documents and the Company may require a Holder to pay any taxes
and fees required by law or permitted by the Indenture.  The Company need not exchange or register the
transfer of any Note or portion of a Note selected for redemption, except for
the unredeemed portion of any Note being redeemed in part, or any Note that has
been tendered in a Change of Control Offer or a Net Proceeds Offer.  Also, it need not exchange or register the
transfer of any Notes for a period of 15 days before the mailing of a
notice of redemption of Notes to be redeemed or during the period between a
record date and the corresponding Interest Payment Date.

 

(11)         Persons
Deemed Owners.  The registered Holder
of a Note may be treated as its owner for all purposes.

 

(12)         Amendment,
Supplement and Waiver.  The Indenture
or the Notes may be amended or supplemented only as provided in the Indenture.

 

(13)         Defaults
and Remedies.  Events of Default
include:  (i) the failure to pay
interest on any Note when the same becomes due and payable and the default
continues for a period of 30 days; (ii) the failure to pay the principal
on any Note, when such principal becomes due and payable, at maturity, upon
redemption or otherwise (including the failure to make a payment to purchase
Notes tendered pursuant to a Change of Control Offer or a Net Proceeds Offer)
on the date specified for such payment in the applicable offer to purchase;
(iii) a default in the observance or performance of any covenant or
agreement contained in the Indenture which default continues for a period of
60 days after the Company received written notice specifying the default
(and demanding that such default be remedied) from the Trustee or the Holders
of at least 25% of the outstanding principal amount of the Notes (except in the
case of a default with respect to Section 5.1 of the Indenture, which will
constitute an Event of Default with such notice requirement but without such
passage of time requirement); (iv) the failure to pay at final maturity
(giving effect to any applicable grace periods and any extensions thereof) the
principal amount of any Indebtedness of the Company or any Restricted
Subsidiary, or the acceleration of the final stated maturity of any such
Indebtedness, if the aggregate principal amount of such Indebtedness, together
with the principal amount of any other such Indebtedness in default for failure
to pay principal at final stated maturity or which has been accelerated,
aggregates $15.0 million or more at any time; (v) one or more judgments in
an aggregate amount in excess of

 

B-9

 

$15.0 million
(to the extent not covered by insurance or bonded) shall have been rendered
against the Company or any of its Significant Subsidiaries and such judgments
remain undischarged, unpaid or unstayed for a period of 60 days after such
judgment or judgments become final and non-appealable; (vi) certain events
of bankruptcy affecting the Company or any of its Significant Subsidiaries, as
specified in the Indenture; and (vii) any Guarantee of Holdings or a
Significant Subsidiary required pursuant to the Indenture ceases to be in full
force and effect or is declared to be null and void and unenforceable or is
found to be invalid or a Guarantor that is a Significant Subsidiary denies its
liability in writing under its Guarantee required pursuant to the Indenture
(other than by reason of release of a Guarantor in accordance with the terms of
the Indenture).  If any Event of Default
(other than an Event of Default specified in clause (vi) above relating to the
Company) shall occur and be continuing, the Trustee or the Holders of at least
25% in principal amount of outstanding Notes may declare the principal of and
accrued interest on all the Notes to be due and payable by notice in writing to the Company and the Trustee specifying the
respective Event of Default and that it is a “notice of acceleration” and the
same shall become immediately due and payable. 
If an Event of Default specified in clause (vi) above relating to the
Company occurs and is continuing, then all unpaid principal of, and premium, if
any, and accrued and unpaid interest on all of the outstanding Notes shall ipso facto become and be immediately due
and payable without any declaration or other act on the part of the Trustee or
any Holder. Holders may not enforce the Indenture or the Notes except as
provided in the Indenture and under the TIA. 
Subject to certain limitations, Holders of a majority in principal
amount of the then outstanding Notes may direct the Trustee in its exercise of
any trust or power. The Holders of a majority in principal amount of the then
outstanding Notes may, by Notice to the Trustee on behalf of the Holders of all
of the Notes, waive any existing Default under the Indenture, and its
consequences, except a default in the payment of the principal of or interest
or Additional Interest, if any, on any Notes. 
The Company is required to deliver to the Trustee annually a statement
regarding compliance with the Indenture. In addition, the Company shall, so
long as any of the Notes are outstanding, deliver to the Trustee, within five
Business Days after any Officer of the Company obtains knowledge of any Default
or Event of Default, an Officer’s Certificate specifying such Default or Event
of Default.

 

(14)         Trustee
Dealings with Company.  Subject to certain limitations, the Trustee
under the Indenture, in its individual or any other capacity, may become owner
or pledge of Notes and may otherwise deal with the Company or its Affiliates as
if it were not Trustee.

 

(15)         No
Recourse Against Others.  No past,
present or future director, officer, employee, incorporator, agent or stockholder
or Affiliate of the Company, as such, shall have any liability for any
obligations of the Company under the Notes, the Indenture or the Registration
Rights Agreement or for any claim based on, in respect of, or by reason of,
such obligations or their creation.  No
past, present or future director, officer, employee, incorporator, agent or
stockholder or Affiliate of any of the Guarantors, as such, shall have any liability
for any obligations of the Guarantors under the Guarantees, the Indenture or
the Registration Rights Agreement or for any claim based on, in respect of, or
by reason of, such obligations or their creation.  Each Holder of Notes and Guarantees by
accepting a Note and a Guarantee waives and releases all such liabilities.  The waiver and release are part of the
consideration for issuance of the Notes and the Guarantees.

 

B-10

 

(16)         Authentication.  This Note shall not be valid until
authenticated by the manual signature of the Trustee or an authenticating
agent.

 

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

 

(18)         Discharge
and Defeasance.  If the Company
deposits, in accordance with the Indenture, with the Trustee or Paying Agent
cash or U.S. Government Obligations sufficient to pay the principal or Redemption
Price of, and interest and Additional Interest, if any, on, the Notes to
maturity or a specified Redemption Date and satisfies certain conditions specified
in the Indenture, the Company will be discharged from the Indenture, except for
certain Sections thereof.

 

(19)         Governing
Law.  The Indenture and this Note
shall be governed by and construed in accordance with the laws of the State of
New York.

 

(20)         CUSIP
Numbers.  Pursuant to a
recommendation promulgated by the Committee on Uniform Security Identification
Procedures, the Company has caused CUSIP numbers to be printed on the Notes and
the Trustee may use CUSIP numbers in notices of redemption as a convenience to
Holders.  No representation is made as to
the correctness or accuracy of such numbers either as printed on the Notes or
as contained in any notice of redemption or repurchase and reliance may be
placed only on the other identification numbers placed thereon.

 

(21)         Registration
Rights.  Pursuant to the Registration
Rights Agreement, the Company will be obligated upon the occurrence of certain
events to consummate an exchange offer pursuant to which the Holder of this
Note shall have the right to exchange this Initial Fixed Rate Note for the
Company’s Exchange Fixed Rate Notes, which have been registered under the
Securities Act, in like principal amount and having terms identical in all
material respects as the Initial Fixed Rate Notes.  The Holders shall be entitled to receive
certain additional interest payments in the event such exchange offer is not
consummated and upon certain other conditions, all pursuant to and in
accordance with the terms of the Registration Rights Agreement.

 

(22)         Request
for Indenture.  The Company will
furnish to any Holder upon written request and without charge a copy of the
Indenture.  Request may be made to:

 

Compression Polymers Holding Corporation

801 Corey St.

Moosic, PA  18507

Attention:  Chief Financial Officer

 

B-11

 

ASSIGNMENT FORM

 

To assign this Note, fill in the form below:

 

I or we assign and transfer this Note to

 

 

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

 

 

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

 

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

 

	
  Date: 

  	
   

  	
   

  
	
   

  
	
  Your Signature:

  	
   

  	
   

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

  
	
   

  
	
  Signature Guarantee:

  
	
   

  
	
  Date: 

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
  Signature of Signature Guarantee

  
							

 

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

 

B-12

 

OPTION OF HOLDER TO ELECT PURCHASE

 

If you wish to elect to have all or any
portion of this Note purchased by the Company pursuant to Section 4.10
(“Net Proceeds Offer”) or Section 4.15 (“Change of Control Offer”) of the
Indenture, check the applicable boxes

 

	
   

  	
  o

  	
  Net Proceeds
  Offer:

  	
  o

  	
  Change of
  Control Offer:

  
	
   

  
	
   

  	
  in whole

  	
  o

  	
  in whole

  	
  o

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
  in part

  	
  o

  	
  in part

  	
  o

  
	
   

  
	
   

  	
  Amount to be

  	
  Amount to be

  
	
   

  	
  purchased: $                       

  	
  purchased: $

  
	
   

  
	
   

  	
  Date: 

  	
   

  	
   

  
	
   

  
	
   

  	
  Your
  Signature:

  	
   

  	
   

  
	
   

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

  
	
   

  
	
   

  	
  Date:

  	
   

  	
   

  
	
   

  
	
   

  	
  Signature
  Guarantee:

  	
   

  
	
   

  
	
   

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

  	
   

  
	
   

  
	
   

  	
  Social
  Security Number or

  
	
   

  	
  Taxpayer
  Identification Number:

  
													

 

B-13

 

EXHIBIT C

FORM OF EXCHANGE FLOATING RATE NOTE

 

(Face of Note)

 

COMPRESSION POLYMERS HOLDING CORPORATION

 

SENIOR FLOATING RATE NOTE DUE 2012

 

[THIS NOTE IS
A GLOBAL NOTE WITHIN THE MEANING OF THE INDENTURE HEREINAFTER REFERRED TO AND
IS REGISTERED IN THE NAME OF A DEPOSITARY OR A NOMINEE OF A DEPOSITARY OR A
SUCCESSOR DEPOSITARY.  THIS NOTE IS NOT
EXCHANGEABLE FOR NOTES REGISTERED IN THE NAME OF A PERSON OTHER THAN THE
DEPOSITARY OR ITS NOMINEE EXCEPT IN THE LIMITED CIRCUMSTANCES DESCRIBED IN THE
INDENTURE, AND NO TRANSFER OF THIS NOTE (OTHER THAN A TRANSFER OF THIS NOTE AS
A WHOLE BY THE DEPOSITARY TO A NOMINEE OF THE DEPOSITARY OR BY A NOMINEE OF THE
DEPOSITARY TO THE DEPOSITARY OR ANOTHER NOMINEE OF THE DEPOSITARY) MAY BE
REGISTERED EXCEPT IN THE LIMITED CIRCUMSTANCES DESCRIBED IN THE INDENTURE.

 

UNLESS THIS
CERTIFICATE IS PRESENTED BY AN AUTHORIZED REPRESENTATIVE OF THE DEPOSITORY
TRUST COMPANY, A NEW YORK CORPORATION (“DTC”), TO THE COMPANY OR ITS AGENT FOR
REGISTRATION OF TRANSFER, EXCHANGE, OR PAYMENT, AND ANY CERTIFICATE ISSUED IS
REGISTERED IN THE NAME OF CEDE & CO. OR IN SUCH OTHER NAME AS IS REQUESTED
BY AN AUTHORIZED REPRESENTATIVE OF DTC (AND ANY PAYMENT IS MADE TO CEDE &
CO. OR TO SUCH OTHER ENTITY AS IS REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF
DTC), ANY TRANSFER, PLEDGE OR OTHER USE HEREOF FOR VALUE OR OTHERWISE BY OR TO
ANY PERSON IS WRONGFUL INASMUCH AS THE REGISTERED OWNER HEREOF, CEDE & CO.,
HAS AN INTEREST HEREIN.](3)

 

(3)           To be included only if
the Note is issued in global form

 

C-1

 

COMPRESSION POLYMERS HOLDING CORPORATION

 

SENIOR FLOATING RATE NOTE DUE 2012

 

	
  CUSIP No.
                                

  
	
  No.
                 

  	
  $                                               

  

 

Interest Payment Dates:  January
1 and July 1

Record Dates:  December 15 and June 15

 

COMPRESSION POLYMERS HOLDING CORPORATION, a
Delaware corporation (the “Company,” which term includes any successor
corporation under the indenture hereinafter referred to), for value received
promises to pay to                                                                                                                                                                  ,
or registered assigns, the principal sum of                                              
Dollars on July 1, 2012.

 

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

 

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

 

C-2

 

IN WITNESS WHEREOF, the Company has caused
this Note to be duly executed.

 

Dated:

 

	
   

  	
  COMPRESSION POLYMERS HOLDING

  CORPORATION

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
   

  
	
   

  	
   

  	
  Name:

  
	
   

  	
   

  	
  Title:

  
	
   

  	
   

  	
   

  
	
  Dated:

  	
   

  
	
   

  	
   

  
	
  This is one of the Notes referred to

  in the within-mentioned Indenture:

  	
   

  
	
   

  	
   

  
	
  WELLS FARGO BANK, N.A.,

  	
   

  
	
      as Trustee

  	
   

  
	
   

  	
   

  
	
  By:

  	
   

  	
   

  	
   

  
	
   

  	
  Authorized Signatory

  	
   

  
					

 

C-3

 

(Back of Note)

 

Senior
Floating Rate Notes due 2012

 

Capitalized terms used herein shall have the
meanings assigned to them in the Indenture referred to below unless otherwise
indicated.

 

1.             Interest.  The Company promises to pay interest on the
principal amount of this Note at a rate per annum, reset semi-annually, equal
to the six-month LIBOR plus 6.75%, as determined by an agent appointed by the
Company (the “Calculation Agent”), which shall initially be the Trustee
from July 5, 2005 until maturity.  The
Company will pay interest semi-annually January 1 and July 1 of each
year, or if any such day is not a Business Day, on the next succeeding Business
Day (each an “Interest Payment Date”). 
Interest on the Note will accrue from the most recent date to which
interest has been paid or, if no interest has been paid, from the date of
issuance; provided that if there is no existing Default in the payment
of interest, and if this Note is authenticated between a record date referred
to on the face hereof and the next succeeding Interest Payment Date, interest
shall accrue from such next succeeding Interest Payment Date; provided, further,
that the first Interest Payment Date shall be January 1, 2006.  The Company shall pay interest (including
post-petition interest in any proceeding under any Bankruptcy Law) on overdue
payments of the principal, Purchase Price and Redemption Price of this Note
from time to time at the same rate per annum on the Notes to the extent
lawful.  Interest will be computed on the
basis of a 360-day year of twelve 30-day months.

 

“LIBOR,” with
respect to an Interest Period, will be the rate (expressed as a percentage per
annum) for deposits in United States dollars for six-month periods beginning on
the first day of such Interest Period that appears on Telerate Page 3750 as of
11:00 a.m., London time, on the Determination Date.  If Telerate Page 3750 does not include such a
rate or is unavailable on a Determination Date, the Calculation Agent will
request the principal London office of each of four major banks in the London
interbank market, as selected by the Calculation Agent, to provide such bank’s
offered quotation (expressed as a percentage per annum), as of approximately
11:00 a.m., London time, on such Determination Date, to prime banks in the London
interbank market for deposits in a Representative Amount in United States
dollars for a three-month period beginning on the first day of such Interest
Period.  If at least two such offered
quotations are so provided, LIBOR for the Interest Period will be the
arithmetic mean of such quotations.  If
fewer than two such quotations are so provided, the Calculation Agent will
request each of three major banks in New York City, as selected by the
Calculation Agent, to provide such bank’s rate (expressed as a percentage per
annum), as of approximately 11:00 a.m., New York City time, on such Determination
Date, for loans in a Representative Amount in United States dollars to leading
European banks for a six-month period beginning on the first day of such
Interest Period.  If at least two such
rates are so provided, LIBOR for the Interest Period will be the arithmetic
mean of such rates.  If fewer than two
such rates are so provided, then LIBOR for the Interest Period will be LIBOR in
effect with respect to the immediately preceding Interest Period.

 

“Interest Period”
means the period commencing on and including an Interest Payment Date and
ending on and including the day immediately preceding the next succeeding

 

C-4

 

Interest Payment Date; provided that the first Interest Period shall commence on
and include July 5, 2005 and end on and include December 31, 2005.

 

“Determination Date,”
with respect to an Interest Period, will be the second London Banking Day
preceding the first day of the Interest Period.

 

“London Banking Day”
is any day in which dealings in United States dollars are transacted or, with
respect to any future date, are expected to be transacted in the London interbank
market.

 

“Representative Amount”
means a principal amount of not less than $1,000,000 for a single transaction
in the relevant market at the relevant time.

 

“Telerate Page 3750”
means the display designated as “Page 3750” on the Moneyline Telerate service
(or such other page as may replace Page 3750 on that service).

 

2.             Method
of Payment.  The Company will pay
interest on the Notes (except defaulted interest) to the Persons who are
registered Holders of Notes at the close of business on the December 15
and June 15 next preceding the Interest Payment Date, even if such Notes
are canceled after such record date and on or before such Interest Payment
Date, except as provided in Section 2.12 of the Indenture with respect to
defaulted interest.  Any such installment
of interest not punctually paid or duly provided for shall forthwith cease to
be payable to the registered Holders on such Interest Payment Date, and may be
paid to the registered Holders at the close of business on a special interest
payment date to be fixed by the Trustee for the payment of such defaulted interest,
notice whereof shall be given to the registered Holders not less than
10 days prior to such special interest payment date, or may be paid at any
time in any other lawful manner not inconsistent with the requirements of any securities
exchange on which the Notes may be listed, and upon such notice as may be
required by such exchange, all as more fully provided in the Indenture.  The Notes will be payable as to principal,
Redemption Price, Purchase Price, interest at the office or agency of the Company
maintained for such purpose within or without the City and State of
New York, or, at the option of the Company.  Payment of interest may be made by check
mailed to the Holders at their addresses set forth in the register of Holders, provided
that payment by wire transfer of immediately available funds will be required with
respect to principal, Redemption Price and Purchase Price of, and interest on,
all Global Notes and all other Notes the Holders of which shall have provided
wire transfer instructions to the Trustee or the Paying Agent.  Such payment shall be in such coin or
currency of the United States of America as at the time of payment is legal
tender for payment of public and private debts.

 

3.             Paying
Agent and Registrar.  Initially,
Wells Fargo Bank, N.A., the Trustee under the Indenture, will act as Paying
Agent and Registrar.  The Company may
change any Paying Agent or Registrar without notice to any Holder.  The Company or any domestically incorporated
wholly-owned subsidiary may act in any such capacity.

 

4.             Indenture
and Guarantees.  The Company issued
the Notes under an Indenture dated as of July 5, 2005 (as in effect from time
to time, the “Indenture”) among the Company, the Guarantors party
thereto from time to time and the Trustee. 
The terms of the

 

C-5

 

Notes include
those stated in the Indenture and those made part of the Indenture by reference
to the Trust Indenture Act of 1939, as amended (15 U.S.C. Code §§
77aaa-77bbbb).  The Notes are subject to
all such terms, and Holders are referred to the Indenture and such Act for a
statement of such terms.  The Notes are
general obligations of the Company.  If
any of the terms or provisions contained in this Note conflicts with any of the
terms or provisions of the Indenture, those contained in the Indenture shall
govern and be controlling.

 

5.             Optional
Redemption.  (a)  The Company may redeem the Notes, at the
Company’s option, in whole at any time, or in part from time to time, on and
after July 1, 2007, upon not less than 30 nor more than 60 days’
notice at the following Redemption Prices (expressed as a percentage of the
principal amount thereof), if redeemed during the 12-month period commencing on
July 1 of the year set forth below, plus, in each case, accrued and unpaid
interest thereon, if any, to the date of redemption:

 

	
  Year

  	
   

  	
  Percentage

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  2007

  	
   

  	
  103.000

  	
  %

  
	
  2008

  	
   

  	
  102.000

  	
  %

  
	
  2009 and thereafter

  	
   

  	
  100.000

  	
  %

  

 

If less than all the Notes are to be
redeemed, the Trustee will select the particular Notes or portions thereof to
be redeemed by lot, pro rata or by any
other method the Trustee shall deem fair and reasonable.

 

(b)           Before
July 1, 2007, the Company may also redeem the Notes, as a whole but not in
part, upon not less than 30 nor more than 60 days’ prior notice, at a
redemption price equal to 100% of the principal amount thereof plus the
Applicable Premium as of, and accrued and unpaid interest thereon, if any, to,
the date of redemption.

 

“Applicable Premium” means, with
respect to any Note on any redemption date, the greater of (i) 1.0% of the
principal amount of such Note and (ii) the excess of (A) the present
value at such redemption date of (1) the redemption price of such Note at
July 1, 2007 (as set forth in the table above), plus (2) all
scheduled interest payments due on such Note from the redemption date through
July 1, 2007 (excluding accrued but unpaid interest to the redemption
date), computed using a discount rate equal to the Treasury Rate at such
redemption date, plus 50 basis points over (B) the principal amount of
such Note.

 

“Treasury Rate” means, with respect to
any redemption date, the yield to maturity at the time of computation of United
States Treasury securities with a constant maturity (as compiled and published
in the most recent Federal Reserve Statistical Release H.15(519) that has become
publicly available at least two business days prior to such redemption date
(or, if such Statistical Release is no longer published, any publicly available
source of similar market data)) most nearly equal to the period from such
redemption date to July 1, 2007; provided, however, that if
the period from such redemption date to July 1, 2007 is not equal to the
constant maturity of a United States Treasury security for which a weekly
average yield is given, the Treasury Rate shall be obtained by linear
interpolation (calculated to the nearest one-twelfth of a year) from the weekly
average yields of United States Treasury securities for which such yields are
given,

 

C-6

 

except that if
the period from such redemption date to July 1, 2007 is less than one year, the
weekly average yield on actually traded United States Treasury securities
adjusted to a constant maturity of one year shall be used.

 

6.             Optional
Redemption upon Public Equity Offerings. 
At any time, or from time to time, on or prior to July 1, 2007, the
Company may, at its option, use the net cash proceeds of one or more Equity
Offerings to redeem up to 35% of the Notes issued under the Indenture at a
redemption price equal to 100% of the principal amount thereof plus a premium
equal to the interest rate per annum on the Note applicable on the date on
which notice of the redemption is given, plus accrued and unpaid interest, to
the date of redemption, provided that at least 65% of the principal amount
of Notes issued under the Indenture remains outstanding immediately after any
such redemption; and provided, further, that the Company shall
make such redemption not more than 120 days after the consummation of any
such Equity Offering.  If less than all
the Notes are to be redeemed, the Trustee will select the particular Notes or
portions thereof to be redeemed by lot, only on a pro rata
basis or on as nearly a pro rata basis
as is practicable (subject to DTC procedures, unless such method is otherwise
prohibited).

 

7.             Mandatory
Redemption.  Except as set forth in
Paragraph 9 below with respect to repurchases of Notes in certain events, the
Company shall not be required to make mandatory redemption payments with
respect to the Notes.

 

8.             Notice
of Redemption.  Subject to the
provisions of the Indenture, a notice of redemption will be mailed at least
30 days but not more than 60 days (or in the case of a Change of
Control Offer, at least 30 days but not more than 60 days, or in the case
of a Net Proceeds Offer, within 30 days) before the applicable redemption date
to each Holder whose Notes are to be redeemed at its registered address.  Notes in denominations larger than $1,000 may
be redeemed in part but only in whole multiples of $1,000, unless all of the
Notes held by a Holder are to be redeemed. 
On and after the redemption date interest ceases to accrue on Notes or
portions thereof called for redemption.

 

9.             Repurchase
at Option of Holder.  (a)  If there is a Change of Control, the Company
shall be required to make an offer (a “Change of Control Offer”) to
repurchase all or any part (equal to $1,000 or an integral multiple thereof) of
each Holder’s Notes at a Purchase Price equal to 101% of the principal amount
thereof plus accrued and unpaid interest to the date of repurchase, in
accordance with the procedures set forth in the Indenture.  Within 30 days following any Change of
Control, or, at the Company’s option, prior to such Change of Control but after
it is publicly announced if a definitive agreement is in place for such Change
of Control at the time of such announcement, the Company shall send, by
first-class mail, a notice to each Holder setting forth the procedures
governing the Change of Control Offer as required by the Indenture.

 

(b)           Under
certain circumstances described in the Indenture, the Company will be required
to apply the proceeds of Asset Sales to the repayment of the Notes and/or Pari
Passu Indebtedness.

 

10.           Denominations,
Transfer, Exchange.  The Notes are in
registered form without coupons in denominations of $1,000 and integral
multiples of $1,000.  The transfer of

 

C-7

 

Notes may be
registered and Notes may be exchanged as provided in the Indenture.  The Registrar and the Trustee may require a
Holder, among other things, to furnish appropriate endorsements and transfer
documents and the Company may require a Holder to pay any taxes and fees
required by law or permitted by the Indenture. 
The Company need not exchange or register the transfer of any Note or
portion of a Note selected for redemption, except for the unredeemed portion of
any Note being redeemed in part, or any Note that has been tendered in a Change
of Control Offer or a Net Proceeds Offer. 
Also, it need not exchange or register the transfer of any Notes for a
period of 15 days the mailing of a notice of redemption of Notes to be redeemed
or during the period between a record date and the corresponding Interest Payment
Date.

 

11.           Persons
Deemed Owners.  The registered Holder
of a Note may be treated as its owner for all purposes.

 

12.           Amendment,
Supplement and Waiver.  The Indenture
or the Notes may be amended or supplemented only as provided in the Indenture.

 

13.           Defaults
and Remedies.  Events of Default
include:  (i) the failure to pay
interest on any Note when the same becomes due and payable and the default
continues for a period of 30 days; (ii) the failure to pay the principal
on any Note, when such principal becomes due and payable, at maturity, upon redemption
or otherwise (including the failure to make a payment to purchase Notes
tendered pursuant to a Change of Control Offer or a Net Proceeds Offer) on the
date specified for such payment in the applicable offer to purchase;
(iii) a default in the observance or performance of any covenant or
agreement contained in the Indenture which default continues for a period of
60 days after the Company received written notice specifying the default
(and demanding that such default be remedied) from the Trustee or the Holders
of at least 25% of the outstanding principal amount of the Notes (except in the
case of a default with respect to Section 5.1 of the Indenture, which will
constitute an Event of Default with such notice requirement but without such
passage of time requirement); (iv) the failure to pay at final maturity
(giving effect to any applicable grace periods and any extensions thereof) the
principal amount of any Indebtedness of the Company or any Restricted
Subsidiary, or the acceleration of the final stated maturity of any such
Indebtedness, if the aggregate principal amount of such Indebtedness, together
with the principal amount of any other such Indebtedness in default for failure
to pay principal at final stated maturity or which has been accelerated, aggregates
$15.0 million or more at any time; (v) one or more judgments in an
aggregate amount in excess of $15.0 million (to the extent not covered by
insurance or bonded) shall have been rendered against the Company or any of its
Significant Subsidiaries and such judgments remain undischarged, unpaid or
unstayed for a period of 60 days after such judgment or judgments become final
and non-appealable; (vi) certain events of bankruptcy affecting the
Company or any of its Significant Subsidiaries, as specified in the Indenture;
and (vii) any Guarantee of Holdings or a Significant Subsidiary required
pursuant to the Indenture ceases to be in full force and effect or is declared
to be null and void and unenforceable or is found to be invalid or a Guarantor
that is a Significant Subsidiary denies its liability in writing under its
Guarantee required pursuant to the Indenture (other than by reason of release
of a Guarantor in accordance with the terms of the Indenture).  If any Event of Default (other than an Event
of Default specified in clause (vi) above relating to the Company) shall occur
and be continuing, the Trustee or the Holders of at least 25% in principal
amount of outstanding Notes may declare the principal

 

C-8

 

of and accrued
interest on all the Notes to be due and payable by notice in writing to the Company and the Trustee specifying the
respective Event of Default and that it is a “notice of acceleration” and the
same shall become immediately due and payable.  If an Event of Default specified in clause
(vi) above relating to the Company occurs and is continuing, then all unpaid
principal of, and premium, if any, and accrued and unpaid interest on all of
the outstanding Notes shall ipso facto become
and be immediately due and payable without any declaration or other act on the
part of the Trustee or any Holder. Holders may not enforce the Indenture
or the Notes except as provided in the Indenture and under the TIA.  Subject to certain limitations, Holders of a
majority in principal amount of the then outstanding Notes may direct the
Trustee in its exercise of any trust or power. The Holders of a majority in
principal amount of the then outstanding Notes may, by Notice to the Trustee on
behalf of the Holders of all of the Notes, waive any existing Default under the
Indenture, and its consequences, except a default in the payment of the
principal of or interest or Additional Interest, if any, on any Notes.  The Company is required to deliver to the
Trustee annually a statement regarding compliance with the Indenture. In
addition, the Company shall, so long as any of the Notes are outstanding,
deliver to the Trustee, within five Business Days after any Officer of the
Company obtains knowledge of any Default or Event of Default, an Officer’s
Certificate specifying such Default or Event of Default.

 

14.           Trustee
Dealings with Company.  Subject to certain limitations, the Trustee
under the Indenture, in its individual or any other capacity, may become owner
or pledgee of Notes and may otherwise deal with the Company or its Affiliates
as if it were not Trustee.

 

15.           No
Recourse Against Others.  No past,
present or future director, officer, employee, incorporator, agent or stockholder
or Affiliate of the Company, as such, shall have any liability for any
obligations of the Company under the Notes, the Indenture or the Registration
Rights Agreement or for any claim based on, in respect of, or by reason of,
such obligations or their creation.  No
past, present or future director, officer, employee, incorporator, agent or
stockholder or Affiliate of any of the Guarantors, as such, shall have any liability
for any obligations of the Guarantors under the Guarantees, the Indenture or
the Registration Rights Agreement or for any claim based on, in respect of, or
by reason of, such obligations or their creation.  Each Holder of Notes and Guarantees by
accepting a Note and a Guarantee waives and releases all such liabilities.  The waiver and release are part of the
consideration for issuance of the Notes and the Guarantees.

 

16.           Authentication.  This Note shall not be valid until
authenticated by the manual signature of the Trustee or an authenticating
agent.

 

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

 

18.           Discharge
and Defeasance.  If the Company
deposits, in accordance with the Indenture, with the Trustee or Paying Agent
cash or U.S. Government Obligations sufficient to pay the principal or Redemption
Price of, and interest and Additional Interest, if any, on, the

 

C-9

 

Notes to
maturity or a specified Redemption Date and satisfies certain conditions
specified in the Indenture, the Company will be discharged from the Indenture,
except for certain Sections thereof.

 

19.           Governing
Law.  The Indenture and this Note
shall be governed by and construed in accordance with the laws of the State of
New York.

 

20.           CUSIP
Numbers.  Pursuant to a
recommendation promulgated by the Committee on Uniform Security Identification
Procedures, the Company has caused CUSIP numbers to be printed on the Notes and
the Trustee may use CUSIP numbers in notices of redemption as a convenience to
Holders.  No representation is made as to
the correctness or accuracy of such numbers either as printed on the Notes or
as contained in any notice of redemption or repurchase and reliance may be
placed only on the other identification numbers placed thereon.

 

21.           Request
for Indenture.  The Company will
furnish to any Holder upon written request and without charge a copy of the
Indenture.  Request may be made to:

 

Compression Polymers Holding Corporation

801 Corey St.

Moosic, PA  18507

Attention:  Chief Financial Officer

 

C-10

 

ASSIGNMENT
FORM

To assign this Note, fill in the form below:

 

I or we assign and transfer this Note to

 

 

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

 

 

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

 

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

 

	
  Date: 

  	
   

  	
   

  
	
   

  
	
  Your Signature:

  	
   

  	
   

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

  
	
   

  
	
  Signature Guarantee:

  
	
   

  
	
  Date: 

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
  Signature of Signature Guarantee

  
							

 

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

 

C-11

 

OPTION OF HOLDER TO ELECT PURCHASE

 

If you wish to elect to have all or any
portion of this Note purchased by the Company pursuant to Section 4.10
(“Net Proceeds Offer”) or Section 4.15 (“Change of Control Offer”) of the
Indenture, check the applicable boxes

 

	
   

  	
  o

  	
  Net Proceeds
  Offer:

  	
  o

  	
  Change of
  Control Offer:

  
	
   

  
	
   

  	
  in whole

  	
  o

  	
   

  	
  in whole

  	
  o

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
  in part

  	
  o

  	
   

  	
  in part

  	
  o

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  Amount to be

  	
   

  	
  Amount to be

  
	
   

  	
  purchased: $                       

  	
   

  	
  purchased: $

  
	
   

  
	
   

  	
  Date: 

  	
   

  	
   

  
	
   

  
	
   

  	
  Your
  Signature:

  	
   

  	
   

  
	
   

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

  
	
   

  	
   

  
	
   

  	
  Date:

  	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  Signature
  Guarantee:

  	
   

  	
   

  
	
   

  	
   

  
	
   

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

  	
   

  
	
   

  
	
   

  	
  Social
  Security Number or

  
	
   

  	
  Taxpayer
  Identification Number:

  
														

 

C-12

 

EXHIBIT D

FORM OF EXCHANGE FIXED RATE NOTE

 

(Face of Note)

 

COMPRESSION POLYMERS HOLDING CORPORATION

 

101⁄2% SENIOR NOTE DUE 2013

 

[THIS NOTE IS
A GLOBAL NOTE WITHIN THE MEANING OF THE INDENTURE HEREINAFTER REFERRED TO AND
IS REGISTERED IN THE NAME OF A DEPOSITARY OR A NOMINEE OF A DEPOSITARY OR A
SUCCESSOR DEPOSITARY.  THIS NOTE IS NOT
EXCHANGEABLE FOR NOTES REGISTERED IN THE NAME OF A PERSON OTHER THAN THE
DEPOSITARY OR ITS NOMINEE EXCEPT IN THE LIMITED CIRCUMSTANCES DESCRIBED IN THE
INDENTURE, AND NO TRANSFER OF THIS NOTE (OTHER THAN A TRANSFER OF THIS NOTE AS
A WHOLE BY THE DEPOSITARY TO A NOMINEE OF THE DEPOSITARY OR BY A NOMINEE OF THE
DEPOSITARY TO THE DEPOSITARY OR ANOTHER NOMINEE OF THE DEPOSITARY) MAY BE
REGISTERED EXCEPT IN THE LIMITED CIRCUMSTANCES DESCRIBED IN THE INDENTURE.

 

UNLESS THIS
CERTIFICATE IS PRESENTED BY AN AUTHORIZED REPRESENTATIVE OF THE DEPOSITORY
TRUST COMPANY, A NEW YORK CORPORATION (“DTC”), TO THE COMPANY OR ITS AGENT FOR
REGISTRATION OF TRANSFER, EXCHANGE, OR PAYMENT, AND ANY CERTIFICATE ISSUED IS
REGISTERED IN THE NAME OF CEDE & CO. OR IN SUCH OTHER NAME AS IS REQUESTED
BY AN AUTHORIZED REPRESENTATIVE OF DTC (AND ANY PAYMENT IS MADE TO CEDE &
CO. OR TO SUCH OTHER ENTITY AS IS REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF
DTC), ANY TRANSFER, PLEDGE OR OTHER USE HEREOF FOR VALUE OR OTHERWISE BY OR TO
ANY PERSON IS WRONGFUL INASMUCH AS THE REGISTERED OWNER HEREOF, CEDE & CO.,
HAS AN INTEREST HEREIN.](4)

 

(4)           To be included only if
the Note is issued in global form

 

D-1

 

COMPRESSION POLYMERS HOLDING CORPORATION

 

101⁄2% SENIOR NOTE DUE 2013

 

	
  CUSIP No.
                                

  
	
  No.
                 

  	
  $                                               

  

 

Interest Payment Dates:  January
1 and July 1

Record Dates:  December 15 and June 15

 

COMPRESSION POLYMERS HOLDING CORPORATION, a
Delaware corporation (the “Company,” which term includes any successor
corporation under the indenture hereinafter referred to), for value received
promises to pay to                                                                                                                                                                  ,
or registered assigns, the principal sum of                                                      
Dollars on July 1, 2013.

 

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

 

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

 

D-2

 

IN WITNESS WHEREOF, the Company has caused
this Note to be duly executed.

 

	
  Dated:

  	
   

  
	
   

  	
   

  
	
   

  	
  COMPRESSION POLYMERS HOLDING

  CORPORATION

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
   

  
	
   

  	
   

  	
  Name:

  
	
   

  	
   

  	
  Title:

  
	
   

  	
   

  	
   

  
	
  Dated:

  	
   

  
	
   

  	
   

  
	
  This is one of the Notes referred to

  in the within-mentioned Indenture:

  	
   

  
	
   

  	
   

  
	
  WELLS FARGO BANK, N.A.,

  	
   

  
	
      as Trustee

  	
   

  
	
   

  	
   

  
	
  By:

  	
   

  	
   

  	
   

  
	
   

  	
  Authorized Signatory

  	
   

  
					

 

D-3

 

(Reverse of
Note)

 

101⁄2% Senior
Notes due 2013

 

Capitalized terms used herein shall have the
meanings assigned to them in the Indenture referred to below unless otherwise
indicated.

 

1.             Interest.  The Company promises to pay interest on the
principal amount of this Note at a rate of 101⁄2% per annum from July 5, 2005
until maturity.  The Company will pay
interest semi-annually January 1 and July 1 of each year, or if any
such day is not a Business Day, on the next succeeding Business Day (each an “Interest
Payment Date”).  Interest on the Note
will accrue from the most recent date to which interest has been paid or, if no
interest has been paid, from the date of issuance; provided that if
there is no existing Default in the payment of interest, and if this Note is
authenticated between a record date referred to on the face hereof and the next
succeeding Interest Payment Date, interest shall accrue from such next succeeding
Interest Payment Date; provided, further, that the first Interest
Payment Date shall be January 1, 2006. 
The Company shall pay interest (including post-petition interest in any
proceeding under any Bankruptcy Law) on overdue payments of the principal,
Purchase Price and Redemption Price of this Note from time to time at the same
rate per annum on the Notes to the extent lawful.  Interest will be computed on the basis of a
360-day year of twelve 30-day months.

 

2.             Method
of Payment.  The Company will pay
interest on the Notes (except defaulted interest) to the Persons who are
registered Holders of Notes at the close of business on the December 15
and June 15 next preceding the Interest Payment Date, even if such Notes
are canceled after such record date and on or before such Interest Payment Date,
except as provided in Section 2.12 of the Indenture with respect to
defaulted interest.  Any such installment
of interest not punctually paid or duly provided for shall forthwith cease to
be payable to the registered Holders on such Interest Payment Date, and may be
paid to the registered Holders at the close of business on a special interest
payment date to be fixed by the Trustee for the payment of such defaulted interest,
notice whereof shall be given to the registered Holders not less than
10 days prior to such special interest payment date, or may be paid at any
time in any other lawful manner not inconsistent with the requirements of any securities
exchange on which the Notes may be listed, and upon such notice as may be
required by such exchange, all as more fully provided in the Indenture.  The Notes will be payable as to principal,
Redemption Price, Purchase Price, interest at the office or agency of the Company
maintained for such purpose within or without the City and State of
New York, or, at the option of the Company.  Payment of interest may be made by check
mailed to the Holders at their addresses set forth in the register of Holders, provided
that payment by wire transfer of immediately available funds will be required
with respect to principal, Redemption Price and Purchase Price of, and interest
on, all Global Notes and all other Notes the Holders of which shall have
provided wire transfer instructions to the Trustee or the Paying Agent.  Such payment shall be in such coin or
currency of the United States of America as at the time of payment is legal
tender for payment of public and private debts.

 

3.             Paying
Agent and Registrar.  Initially,
Wells Fargo Bank, N.A., the Trustee under the Indenture, will act as Paying
Agent and Registrar.  The Company may
change

 

D-4

 

any Paying
Agent or Registrar without notice to any Holder.  The Company or any domestically incorporated
wholly-owned subsidiary may act in any such capacity.

 

4.             Indenture
and Guarantees.  The Company issued
the Notes under an Indenture dated as of July 5, 2005 (as in effect from time
to time, the “Indenture”) among the Company, the Guarantors party
thereto from time to time and the Trustee. 
The terms of the Notes include those stated in the Indenture and those
made part of the Indenture by reference to the Trust Indenture Act of 1939, as
amended (15 U.S.C. Code §§ 77aaa-77bbbb). 
The Notes are subject to all such terms, and Holders are referred to the
Indenture and such Act for a statement of such terms.  The Notes are general obligations of the
Company.  If any of the terms or provisions
contained in this Note conflicts with any of the terms or provisions of the
Indenture, those contained in the Indenture shall govern and be controlling.

 

5.             Optional
Redemption.  (a)  The Company may redeem the Notes, at the
Company’s option, in whole at any time, or in part from time to time, on and
after July 1, 2009, upon not less than 30 nor more than 60 days’
notice at the following Redemption Prices (expressed as a percentage of the
principal amount thereof), if redeemed during the 12-month period commencing on
July 1 of the year set forth below, plus, in each case, accrued and unpaid interest
thereon, if any, to the date of redemption:

 

	
  Year

  	
   

  	
  Percentage

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  2009

  	
   

  	
  105.250

  	
  %

  
	
  2010

  	
   

  	
  102.625

  	
  %

  
	
  2011 and thereafter

  	
   

  	
  100.000

  	
  %

  

 

If less than all the Notes are to be
redeemed, the Trustee will select the particular Notes or portions thereof to
be redeemed by lot, pro rata or by
any other method the Trustee shall deem fair and reasonable.

 

(b)           Before
July 1, 2009, the Company may also redeem the Notes, as a whole but not in
part, upon not less than 30 nor more than 60 days’ prior notice, at a
redemption price equal to 100% of the principal amount thereof plus the
Applicable Premium as of, and accrued and unpaid interest thereon, if any, to,
the date of redemption.

 

“Applicable Premium” means, with
respect to any Note on any redemption date, the greater of (i) 1.0% of the
principal amount of such Note and (ii) the excess of (A) the present
value at such redemption date of (1) the redemption price of such Note at
July 1, 2009 (as set forth in the table above), plus (2) all
scheduled interest payments due on such Note from the redemption date through
July 1, 2009 (excluding accrued but unpaid interest to the redemption
date), computed using a discount rate equal to the Treasury Rate at such
redemption date, plus 50 basis points over (B) the principal amount of
such Note.

 

“Treasury Rate” means, with respect to
any redemption date, the yield to maturity at the time of computation of United
States Treasury securities with a constant maturity (as compiled and published
in the most recent Federal Reserve Statistical Release H.15(519) that has become
publicly available at least two business days prior to such redemption date
(or, if such

 

D-5

 

Statistical
Release is no longer published, any publicly available source of similar market
data)) most nearly equal to the period from such redemption date to
July 1, 2009; provided, however, that if the period from
such redemption date to July 1, 2009 is not equal to the constant maturity
of a United States Treasury security for which a weekly average yield is given,
the Treasury Rate shall be obtained by linear interpolation (calculated to the
nearest one-twelfth of a year) from the weekly average yields of United States
Treasury securities for which such yields are given, except that if the period
from such redemption date to July 1, 2009 is less than one year, the weekly
average yield on actually traded United States Treasury securities adjusted to
a constant maturity of one year shall be used.

 

6.             Optional
Redemption upon Public Equity Offerings. 
At any time, or from time to time, on or prior to July 1, 2008, the
Company may, at its option, use the net cash proceeds of one or more Equity
Offerings to redeem up to 35% of the Notes issued under the Indenture at a
redemption price equal to 110.50% of the principal amount thereof, plus accrued
and unpaid interest, to the date of redemption, provided that at least
65% of the principal amount of Notes issued under the Indenture remains
outstanding immediately after any such redemption; and provided, further,
that the Company shall make such redemption not more than 120 days after
the consummation of any such Equity Offering. 
If less than all the Notes are to be redeemed, the Trustee will select
the particular Notes or portions thereof to be redeemed by lot, only on a pro rata basis or on as nearly a pro rata
basis as is practicable (subject to DTC procedures, unless such method is
otherwise prohibited).

 

7.             Mandatory
Redemption.  Except as set forth in
Paragraph 9 below with respect to repurchases of Notes in certain events, the
Company shall not be required to make mandatory redemption payments with
respect to the Notes.

 

8.             Notice
of Redemption.  Subject to the
provisions of the Indenture, a notice of redemption will be mailed at least
30 days but not more than 60 days (or in the case of a Change of
Control Offer, at least 30 days but not more than 60 days, or in the case
of a Net Proceeds Offer, within 30 days) before the applicable redemption date
to each Holder whose Notes are to be redeemed at its registered address.  Notes in denominations larger than $1,000 may
be redeemed in part but only in whole multiples of $1,000, unless all of the
Notes held by a Holder are to be redeemed. 
On and after the redemption date interest ceases to accrue on Notes or
portions thereof called for redemption.

 

9.             Repurchase
at Option of Holder.  (a)  If there is a Change of Control, the Company
shall be required to make an offer (a “Change of Control Offer”) to
repurchase all or any part (equal to $1,000 or an integral multiple thereof) of
each Holder’s Notes at a Purchase Price equal to 101% of the principal amount
thereof plus accrued and unpaid interest to the date of repurchase, in
accordance with the procedures set forth in the Indenture.  Within 30 days following any Change of
Control, or, at the Company’s option, prior to such Change of Control but after
it is publicly announced if a definitive agreement is in place for such Change
of Control at the time of such announcement, the Company shall send, by
first-class mail, a notice to each Holder setting forth the procedures
governing the Change of Control Offer as required by the Indenture.

 

D-6

 

(b)           Under
certain circumstances described in the Indenture, the Company will be required
to apply the proceeds of Asset Sales to the repayment of the Notes and/or Pari
Passu Indebtedness.

 

10.           Denominations,
Transfer, Exchange.  The Notes are in
registered form without coupons in denominations of $1,000 and integral
multiples of $1,000.  The transfer of
Notes may be registered and Notes may be exchanged as provided in the
Indenture.  The Registrar and the Trustee
may require a Holder, among other things, to furnish appropriate endorsements
and transfer documents and the Company may require a Holder to pay any taxes
and fees required by law or permitted by the Indenture.  The Company need not exchange or register the
transfer of any Note or portion of a Note selected for redemption, except for
the unredeemed portion of any Note being redeemed in part, or any Note that has
been tendered in a Change of Control Offer or a Net Proceeds Offer.  Also, it need not exchange or register the
transfer of any Notes for a period of 15 days the mailing of a notice of
redemption of Notes to be redeemed or during the period between a record date
and the corresponding Interest Payment Date.

 

11.           Persons
Deemed Owners.  The registered Holder
of a Note may be treated as its owner for all purposes.

 

12.           Amendment,
Supplement and Waiver.  The Indenture
or the Notes may be amended or supplemented only as provided in the Indenture.

 

13.           Defaults
and Remedies.  Events of Default
include:  (i) the failure to pay
interest on any Note when the same becomes due and payable and the default
continues for a period of 30 days; (ii) the failure to pay the principal
on any Note, when such principal becomes due and payable, at maturity, upon
redemption or otherwise (including the failure to make a payment to purchase
Notes tendered pursuant to a Change of Control Offer or a Net Proceeds Offer)
on the date specified for such payment in the applicable offer to purchase;
(iii) a default in the observance or performance of any covenant or
agreement contained in the Indenture which default continues for a period of
60 days after the Company received written notice specifying the default
(and demanding that such default be remedied) from the Trustee or the Holders
of at least 25% of the outstanding principal amount of the Notes (except in the
case of a default with respect to Section 5.1 of the Indenture, which will
constitute an Event of Default with such notice requirement but without such
passage of time requirement); (iv) the failure to pay at final maturity
(giving effect to any applicable grace periods and any extensions thereof) the
principal amount of any Indebtedness of the Company or any Restricted
Subsidiary, or the acceleration of the final stated maturity of any such
Indebtedness, if the aggregate principal amount of such Indebtedness, together
with the principal amount of any other such Indebtedness in default for failure
to pay principal at final stated maturity or which has been accelerated,
aggregates $15.0 million or more at any time; (v) one or more judgments in
an aggregate amount in excess of $15.0 million (to the extent not covered by
insurance or bonded) shall have been rendered against the Company or any of its
Significant Subsidiaries and such judgments remain undischarged, unpaid or
unstayed for a period of 60 days after such judgment or judgments become final
and non-appealable; (vi) certain events of bankruptcy affecting the
Company or any of its Significant Subsidiaries, as specified in the Indenture;
and (vii) any Guarantee of Holdings or a Significant Subsidiary required
pursuant to the Indenture ceases to be in full force

 

D-7

 

and effect or
is declared to be null and void and unenforceable or is found to be invalid or
a Guarantor that is a Significant Subsidiary denies its liability in writing
under its Guarantee required pursuant to the Indenture (other than by reason of
release of a Guarantor in accordance with the terms of the Indenture).  If any Event of Default (other than an Event
of Default specified in clause (vi) above relating to the Company) shall occur
and be continuing, the Trustee or the Holders of at least 25% in principal
amount of outstanding Notes may declare the principal of and accrued interest
on all the Notes to be due and payable by
notice in writing to the Company and the Trustee specifying the respective
Event of Default and that it is a “notice of acceleration” and the same shall
become immediately due and payable.  If
an Event of Default specified in clause (vi) above relating to the Company
occurs and is continuing, then all unpaid principal of, and premium, if any,
and accrued and unpaid interest on all of the outstanding Notes shall ipso facto become and be immediately due
and payable without any declaration or other act on the part of the Trustee or
any Holder. Holders may not enforce the Indenture or the Notes except as
provided in the Indenture and under the TIA. 
Subject to certain limitations, Holders of a majority in principal
amount of the then outstanding Notes may direct the Trustee in its exercise of
any trust or power. The Holders of a majority in principal amount of the then
outstanding Notes may, by Notice to the Trustee on behalf of the Holders of all
of the Notes, waive any existing Default under the Indenture, and its
consequences, except a default in the payment of the principal of or interest or
Additional Interest, if any, on any Notes. 
The Company is required to deliver to the Trustee annually a statement
regarding compliance with the Indenture. In addition, the Company shall, so
long as any of the Notes are outstanding, deliver to the Trustee, within five
Business Days after any Officer of the Company obtains knowledge of any Default
or Event of Default, an Officer’s Certificate specifying such Default or Event
of Default.

 

14.           Trustee
Dealings with Company.  Subject to certain limitations, the Trustee
under the Indenture, in its individual or any other capacity, may become owner
or pledgee of Notes and may otherwise deal with the Company or its Affiliates
as if it were not Trustee.

 

15.           No
Recourse Against Others.  No past,
present or future director, officer, employee, incorporator, agent or stockholder
or Affiliate of the Company, as such, shall have any liability for any
obligations of the Company under the Notes, the Indenture or the Registration
Rights Agreement or for any claim based on, in respect of, or by reason of,
such obligations or their creation.  No
past, present or future director, officer, employee, incorporator, agent or
stockholder or Affiliate of any of the Guarantors, as such, shall have any liability
for any obligations of the Guarantors under the Guarantees, the Indenture or
the Registration Rights Agreement or for any claim based on, in respect of, or
by reason of, such obligations or their creation.  Each Holder of Notes and Guarantees by
accepting a Note and a Guarantee waives and releases all such liabilities.  The waiver and release are part of the
consideration for issuance of the Notes and the Guarantees.

 

16.           Authentication.  This Note shall not be valid until
authenticated by the manual signature of the Trustee or an authenticating
agent.

 

17.           Abbreviations.  Customary abbreviations may be used in the
name of a Holder or an assignee, such as: 
TEN COM (= tenants in common), TEN ENT (= tenants by the

 

D-8

 

entireties),
JT TEN (= joint tenants with right of survivorship and not as tenants in common),
CUST (= Custodian), and U/G/M/A (= Uniform Gifts to Minors Act).

 

18.           Discharge
and Defeasance.  If the Company
deposits, in accordance with the Indenture, with the Trustee or Paying Agent
cash or U.S. Government Obligations sufficient to pay the principal or Redemption
Price of, and interest and Additional Interest, if any, on, the Notes to
maturity or a specified Redemption Date and satisfies certain conditions
specified in the Indenture, the Company will be discharged from the Indenture,
except for certain Sections thereof.

 

19.           Governing
Law.  The Indenture and this Note
shall be governed by and construed in accordance with the laws of the State of
New York.

 

20.           CUSIP
Numbers.  Pursuant to a
recommendation promulgated by the Committee on Uniform Security Identification
Procedures, the Company has caused CUSIP numbers to be printed on the Notes and
the Trustee may use CUSIP numbers in notices of redemption as a convenience to
Holders.  No representation is made as to
the correctness or accuracy of such numbers either as printed on the Notes or
as contained in any notice of redemption or repurchase and reliance may be
placed only on the other identification numbers placed thereon.

 

21.           Request
for Indenture.  The Company will
furnish to any Holder upon written request and without charge a copy of the
Indenture.  Request may be made to:

 

Compression Polymers Holding Corporation

801 Corey St.

Moosic, PA  18507

Attention:  Chief Financial Officer

 

D-9

 

ASSIGNMENT
FORM

 

To assign this Note, fill in the form below:

I or we assign and transfer this Note to

 

 

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

 

 

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

 

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

 

	
  Date: 

  	
   

  	
   

  
	
   

  
	
  Your Signature:

  	
   

  	
   

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

  
	
   

  
	
  Signature Guarantee:

  
	
   

  
	
  Date: 

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
  Signature of Signature Guarantee

  
								

 

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

 

D-10

 

OPTION OF HOLDER TO ELECT PURCHASE

 

If you wish to elect to have all or any
portion of this Note purchased by the Company pursuant to Section 4.10 (“Net
Proceeds Offer”) or Section 4.15 (“Change of Control Offer”) of
the Indenture, check the applicable boxes

 

	
   

  	
  o

  	
  Net Proceeds
  Offer:

  	
  o

  	
  Change of
  Control Offer:

  
	
   

  
	
   

  	
  in whole

  	
  o

  	
   

  	
  in whole

  	
  o

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
  in part

  	
  o

  	
   

  	
  in part

  	
  o

  
	
   

  
	
   

  	
  Amount to be

  	
   

  	
  Amount to be

  
	
   

  	
  purchased: $                       

  	
   

  	
  purchased: $

  
	
   

  
	
   

  	
  Date: 

  	
   

  	
   

  
	
   

  
	
   

  	
  Your
  Signature:

  	
   

  	
   

  
	
   

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

  
	
   

  
	
   

  	
  Date:

  	
   

  	
   

  
	
   

  
	
   

  	
  Signature
  Guarantee:

  	
   

  	
   

  
	
   

  
	
   

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

  	
   

  
	
   

  
	
   

  	
  Social
  Security Number or

  
	
   

  	
  Taxpayer
  Identification Number:

  
															

 

D-11

 

EXHIBIT E

 

FORM OF
SUPPLEMENTAL INDENTURE IN RESPECT OF GUARANTEE

 

SUPPLEMENTAL INDENTURE, dated as of [                     ]
(this “Supplemental Indenture”), among [name of Guarantor[s]] (the “New
Guarantor[s]”), Compression Polymers Holding Corporation, a Delaware corporation
(together with its successors and assigns, the “Company”), Compression
Polymers Holding II Corporation, Compression Polymers Corp., Vycom Corp.,
CPCapitol Acquisition Corp. (collectively, the “Existing Guarantors” and
together with the New Guarantors, the “Guarantors”) and Wells Fargo
Bank, N.A., a national banking association, as Trustee (the “Trustee”)
under the Indenture referred to below.

 

W I T N E S S E T H:

 

WHEREAS, the Company, the Existing Guarantors
and the Trustee are parties to an Indenture, dated as of July 5, 2005 (as
amended, supplemented, waived or otherwise modified, the “Indenture”),
providing for the issuance of Senior Floating Rate Notes due 2012 (the “Floating
Rate Notes”) and 101⁄2% Senior Notes due 2013 (the “Fixed Rate Notes”
and, together with the Floating Rate Notes, the “Notes”)
of the Company;

 

WHEREAS, Section 4.16 of the Indenture
provides that the Company is required to cause the New Guarantor[s] to execute
and deliver to the Trustee a supplemental indenture pursuant to which the New
Guarantor[s] shall guarantee the Notes pursuant to [a]  Guarantee[s] on the terms and conditions set
forth herein and in Article XI of the Indenture;

 

WHEREAS, [the][each] New Guarantor desires to
enter into this Supplemental Indenture for good and valuable consideration,
including substantial economic benefit in that the financial performance and
condition of such New Guarantor is dependent on the financial performance and
condition of the Company;

 

WHEREAS, pursuant to Section 9.1 of the
Indenture, the parties hereto are authorized to execute and deliver this
Supplemental Indenture to amend the Indenture, without the consent of any
Holder; and

 

WHEREAS, all things
necessary have been done to make this Supplemental Indenture, when executed and
delivered by the Company, the Existing Guarantors and each New Guarantor, the
legal, valid and binding agreement of the Company, the Existing Guarantors and
each New Guarantor, in accordance with its terms.

 

NOW, THEREFORE, in consideration of the
foregoing and for other good and valuable consideration, the receipt of which
is hereby acknowledged, the Guarantor[s], the Company and the Trustee mutually
covenant and agree for the benefit of the Holders of the Notes as follows:

 

1.             Defined
Terms.  As used in this Supplemental
Indenture, terms defined in the Indenture or in the preamble or recital hereto
are used herein as therein defined.  The
words “herein,” “hereof” and “hereby” and other words of similar import used in
this Supplemental

 

E-1

 

Indenture
refer to this Supplemental Indenture as a whole and not to any particular
section hereof.

 

2.             Agreement
to Guarantee.  [The] [Each] New
Guarantor hereby agree[s], jointly and severally with [all] [any] Existing Guarantor[s],
unconditionally, to guarantee the Notes and the obligations of the Company
under the Indenture and the Notes on the terms and subject to the conditions
set forth in Article XI of the Indenture and to be bound by (and shall be
entitled to the benefits of) all other applicable provisions of the Indenture
as a Guarantor.

 

3.             Termination,
Release and Discharge.  [The] [Each]
New Guarantor’s Guarantee shall terminate and be of no further force or effect,
and [the] [each] New Guarantor shall be released and discharged from all
obligations in respect of its Guarantee, only as and when provided in Section 11.5
of the Indenture.

 

4.             Parties.  Nothing in this Supplemental Indenture is
intended or shall be construed to give any Person, other than the Holders and
the Trustee, any legal or equitable right, remedy or claim under or in respect
of [the] [each] New Guarantor’s Guarantee or any provision contained herein or
in Article XI of the Indenture.

 

5.             Governing
Law.  THIS SUPPLEMENTAL INDENTURE,
THE INDENTURE, THE GUARANTEES AND THE NOTES SHALL BE GOVERNED BY AND CONSTRUED
IN ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK.

 

6.             Ratification
of Indenture; Supplemental Indentures Part of Indenture.  Except as expressly amended hereby, the
Indenture is in all respects ratified and confirmed and all the terms,
conditions and provisions thereof shall remain in full force and effect.  This Supplemental Indenture shall form a part
of the Indenture for all purposes, and every Holder of Notes heretofore or
hereafter authenticated and delivered shall be bound hereby.  The Trustee makes no representation or
warranty as to the validity or sufficiency of this Supplemental Indenture.

 

7.             Counterparts.  The parties hereto may sign one or more
copies of this Supplemental Indenture in counterparts, all of which together
shall constitute one and the same agreement.

 

8.             Headings.  The section headings herein are for
convenience of reference only and shall not be deemed to alter or affect the
meaning or interpretation of any provisions hereof.

 

E-2

 

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

 

	
   

  	
  [NAME OF GUARANTOR], as Guarantor

  
	
   

  	
   

  
	
   

  	
  By:

  	
   

  
	
   

  	
   

  	
  Name:

  
	
   

  	
   

  	
  Title:

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  COMPRESSION POLYMERS HOLDING

       CORPORATION

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
   

  
	
   

  	
   

  	
  Name:

  
	
   

  	
   

  	
  Title:

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  COMPRESSION POLYMERS HOLDING II

       CORPORATION

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
   

  
	
   

  	
   

  	
  Name:

  
	
   

  	
   

  	
  Title:

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  COMPRESSION POLYMERS CORP.

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
   

  
	
   

  	
   

  	
  Name:

  
	
   

  	
   

  	
  Title:

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  VYCOM CORP.

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
   

  
	
   

  	
   

  	
  Name:

  
	
   

  	
   

  	
  Title:

  

 

E-3

 

	
   

  	
  CPCAPITOL ACQUISITION CORP.

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
   

  
	
   

  	
   

  	
  Name:

  
	
   

  	
   

  	
  Title:

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  WELLS FARGO BANK, N.A., as Trustee

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
   

  
	
   

  	
   

  	
  Name:

  
	
   

  	
   

  	
  Title:

  

 

E-4

 

EXHIBIT F(1)

FORM OF REGULATION S CERTIFICATE

 

	
   

  	
                                   ,         

  

 

Wells Fargo Bank, N.A.

213 Court Street, Suite 703

Middletown, CT  06457

Attention:  Corporate Trust Administration

Fax:  860-704-6219

 

Attention:  Robert McIntyre

 

	
  Re:

  	
   

  	
  Compression Polymers Holding Corporation (the “Company”)

  Senior Floating Rate Notes due 2012 and 10 1⁄2% Senior

  Notes due 2013 (together, the “Notes”)

  	
   

  

 

Dear Sirs:

This letter relates to U.S. $                        
principal amount at maturity of Notes represented by a certificate (the “Legended
Certificate”) which bears a legend outlining restrictions upon transfer of
such Legended Certificate.  Pursuant to
Section 2.1 of the Indenture (the “Indenture”) dated as of July 5,
2005 relating to the Notes, we hereby certify that we are (or we will hold such
securities on behalf of) a person outside the United States to whom the Notes
could be transferred in accordance with Rule 904 of Regulation S promulgated
under the U.S. Securities Act of 1933, as amended.

 

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

 

	
   

  	
  Very truly yours,

  
	
   

  	
   

  
	
   

  	
  [Name of Holder]

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
   

  
	
   

  	
   

  	
  Authorized Signature

  

 

F(1)-1

 

EXHIBIT F(2)

CERTIFICATE TO BE DELIVERED

UPON EXCHANGE OR REGISTRATION OF TRANSFER OF NOTES

 

	
   

  	
                                   ,         

  

 

Wells Fargo Bank, N.A.

213 Court Street, Suite 703

Middletown, CT  06457

Attention:  Corporate Trust
Administration

Fax:  860-704-6219

 

Attention:  Robert McIntyre

 

	
  Re:

  	
   

  	
  Compression Polymers Holding Corporation (the “Company”) 

  Senior Floating Rate Notes due 2012 and 101⁄2% Senior

  Notes due 2013 (together, the “Notes”)

  	
   

  

 

Dear Sirs:

 

This Certificate relates to $                                 
principal amount of Notes held in *         
book-entry or *             
certificated form by                                          (the
“Transferor”).

 

The Transferor:*

 

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

 

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

 

In connection with such request and in
respect of each such Note, the Transferor does hereby certify that Transferor
is familiar with the Indenture relating to the above captioned Notes and as
provided in Section 2.6 of such Indenture, the transfer of this Note does
not require registration under the Securities Act (as defined below) because:*

 

o
Such Note is being acquired for the Transferor’s own account, without transfer.

 

*              Check applicable box

 

F(2)-1

 

o
Such Note is being transferred to a “qualified institutional buyer” (as defined
in Rule 144A under the Securities Act of 1933, as amended (the “Securities
Act”)) in reliance on Rule 144A.

 

o
Such Note is being transferred to an “accredited investor” (as defined in Rule
501(a)(1), (2), (3) or (7) under the Securities Act) in accordance with Regulation
D under the Securities Act.

 

o
Such Note is being transferred pursuant to an exemption from registration in
accordance with Regulation S under the Securities Act.

 

o
Such Note is being transferred in accordance with Rule 144 under the Securities
Act, or pursuant to an effective registration statement under the Securities
Act.

 

o
Such Note is being transferred in reliance on and in compliance with an exemption
from the registration requirements of the Securities Act, other than
Rule 144A, 144 or Rule 904 under the Securities Act.  An Opinion of Counsel to the effect that such
transfer does not require registration under the Securities Act accompanies
this Certificate.

 

	
   

  	
   

  	
  Very truly yours,

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  [INSERT NAME OF TRANSFEROR]

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  By:

  	
   

  
	
   

  	
   

  	
   

  	
  Name:

  
	
   

  	
   

  	
   

  	
  Title:

  
	
   

  	
   

  	
   

  	
   

  
	
  Date:

  	
   

  	
   

  
						

 

F(2)-2

 

EXHIBIT G

FORM OF CERTIFICATE TO BE

DELIVERED IN CONNECTION WITH

TRANSFERS TO NON-QIB ACCREDITED INVESTORS

 

	
   

  	
                                   ,         

  

 

Wells Fargo Bank, N.A.

213 Court Street, Suite 703

Middletown, CT  06457

Attention:  Corporate Trust
Administration

Fax:  860-704-6219

 

Attention:  Robert McIntyre

 

	
  Re:

  	
   

  	
  Compression Polymers Holding Corporation (the “Company”) 

  Senior Floating Rate Notes and 101⁄2% Senior Notes due 2013   

  	
   

  

 

Dear Sirs:

In connection with our proposed purchase of
Senior Floating Rate Notes due 2012 and 101⁄2% Senior Notes due 2013 (together,
the “Notes”) of the Company, we confirm
that:

 

We understand that any subsequent transfer of
the Notes is subject to certain restrictions and conditions set forth in the
Indenture dated as of July 5, 2005 relating to the Notes (the “Indenture”)
and the undersigned agrees to be bound by, and not to resell, pledge or otherwise
transfer the Notes except in compliance with such restrictions and conditions
and the Securities Act of 1933, as amended (the “Securities Act”).

 

We understand that the Notes have not been
registered under the Securities Act or any other applicable securities law, and
that the Notes may not be offered, sold or otherwise transferred except as
permitted in the following sentence.  We
agree, on our own behalf and on behalf of any accounts for which we are acting
as hereinafter stated, that if we should offer, sell, transfer, pledge, hypothecate
or otherwise dispose of any Notes within two years after the original issuance
of the Notes, we will do so only (A) to the Company or any Subsidiary
thereof, (B) inside the United States to a “qualified institutional buyer” in
compliance with Rule 144A under the Securities Act, (C) inside the United
States to an institutional “accredited investor” (as defined below) that, prior
to such transfer, furnishes to you a signed letter substantially in the form of
this letter, (D) outside the United States to a foreign person in compliance
with Rule 904 of Regulation S under the Securities Act, (E) pursuant to
the exemption from registration provided by Rule 144 under the Securities
Act (if available), (F) in accordance with another exemption from the registration
requirements of the Securities Act, or (G) pursuant to an effective registration
statement under the Securities Act, and we further agree to provide to any

 

G-1

 

person
purchasing any of the Notes from us a notice advising such purchaser that
resales of the Notes are restricted as stated herein and in the Indenture.

 

We understand that, on any proposed transfer
of any Notes prior to the later of the original issue date of the Notes and the
last date the Notes were held by an affiliate of the Company pursuant to
clauses (C), (D) and (E) of the third paragraph above, we will be required to
furnish to you and the Company such certifications, legal opinions and other
information as you and the Company may reasonably require to confirm that the
proposed transfer complies with the foregoing restrictions.  We further understand that the Notes
purchased by us will bear a legend to the foregoing effect.

 

We are an institutional “accredited investor”
(as defined in Rule 501(a)(1), (2), (3) or (7) under the Securities Act) and
have such knowledge and experience in financial and business matters as to be
capable of evaluating the merits and risks of our investment in the Notes, and
we and any accounts for which we are acting are acquiring the Notes for
investment purposes and not with a view to, or offer of sale in connection
with, any distribution in violation of the Securities Act, and we are each able
to bear the economic risk of our or its investment.

 

We are acquiring the Notes purchased by us
for our own account or for one or more accounts (each of which is an
institutional “accredited investor”) as to each of which we exercise sole investment
discretion.

 

You and the Company are entitled to rely upon
this letter and are irrevocably authorized to produce this letter or a copy
hereof to any interested party in any administrative or legal proceedings or
official inquiry with respect to the matters covered hereby.

 

	
   

  	
  Very truly yours,

  
	
   

  	
   

  
	
   

  	
  (Name of Transferee)

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
   

  
	
   

  	
   

  	
  Name:

  
	
   

  	
   

  	
  Title:

  

 

G-2

 

EXHIBIT H

FORM OF CERTIFICATE TO BE DELIVERED

IN CONNECTION WITH TRANSFERS

PURSUANT TO REGULATION S

 

	
   

  	
                                   ,         

  

 

Wells Fargo Bank, N.A.

213 Court Street, Suite 703

Middletown, CT  06457

Attention:  Corporate Trust
Administration

Fax:  860-704-6219

 

Attention:  Robert McIntyre

 

	
  Re:

  	
   

  	
  Compression Polymers Holding Corporation (the “Company”) 

  Senior Floating Rate Notes due 2012 and 101⁄2% Senior

  Notes due 2013 (together, the “Notes”)

  	
   

  

 

Dear Sirs:

In connection with our proposed sale of
$_________ aggregate principal amount at maturity of the Notes, we confirm that
such sale has been effected pursuant to and in accordance with
Regulation S under the Securities Act of 1933, as amended, and,
accordingly, we represent that:

 

(1)           the
offer of the Notes was not made to a person in the United States;

 

(2)           at
the time the buy order 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;

 

(3)           no
directed selling efforts have been made by us in the United States in
contravention of the requirements of Rule 903(b) or Rule 904(b) of
Regulation S, as applicable; and

 

(4)           the
transaction is not part of a plan or scheme to evade the registration requirements
of the U.S. Securities Act of 1933.

 

H-1

 

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

 

	
   

  	
  Very truly yours,

  
	
   

  	
   

  
	
   

  	
  [Name of Transferor]

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
   

  
	
   

  	
   

  	
  Authorized Signature

  

 

H-2Exhibit 4.2

 

EXECUTION COPY

 

SUPPLEMENTAL INDENTURE IN RESPECT OF GUARANTEE

 

FIRST
SUPPLEMENTAL INDENTURE, dated as of April 27, 2006 (this “Supplemental
Indenture”), among CPH Sub I Corporation, a Delaware corporation, CPH Sub
II Corporation, a Delaware corporation, CPC Sub I Corporation, a Delaware
corporation, and VC Sub I Corporation, a Delaware corporation (the “New
Guarantors”), Compression Polymers Holding Corporation, a Delaware
corporation (together with its successors and assigns, the “Company”), Compression
Polymers Holding II Corporation, Compression Polymers Corp., Vycom Corp.,
CPCapitol Acquisition Corp. (collectively, the “Existing Guarantors” and
together with the New Guarantors, the “Guarantors”) and Wells Fargo
Bank, N.A., a national banking association, as Trustee (the “Trustee”)
under the Indenture referred to below.

 

W I T N E S S E T H:

 

WHEREAS, the
Company, the Existing Guarantors and the Trustee are parties to an Indenture,
dated as of July 5, 2005 (as amended, supplemented, waived or otherwise
modified, the “Indenture”), providing for the issuance of Senior
Floating Rate Notes due 2012 (the “Floating Rate Notes”) and 101⁄2% Senior
Notes due 2013 (the “Fixed Rate Notes” and, together with the Floating
Rate Notes, the “Notes”) of the Company;

 

WHEREAS,
Section 4.16 of the Indenture provides that the Company is required to
cause the New Guarantors to execute and deliver to the Trustee a supplemental
indenture pursuant to which the New Guarantors shall guarantee the Notes
pursuant to Guarantees on the terms and conditions set forth herein and in
Article XI of the Indenture;

 

WHEREAS, each
New Guarantor desires to enter into this Supplemental Indenture for good and
valuable consideration, including substantial economic benefit in that the financial
performance and condition of such New Guarantor is dependent on the financial
performance and condition of the Company;

 

WHEREAS,
pursuant to Section 9.1 of the Indenture, the parties hereto are authorized
to execute and deliver this Supplemental Indenture to amend the Indenture,
without the consent of any Holder; and

 

WHEREAS,
all things necessary have been done to make this Supplemental Indenture, when
executed and delivered by the Company, the Existing Guarantors and each New
Guarantor, the legal, valid and binding agreement of the Company, the Existing
Guarantors and each New Guarantor, in accordance with its terms.

 

NOW,
THEREFORE, in consideration of the foregoing and for other good and valuable
consideration, the receipt of which is hereby acknowledged, the Guarantors, the
Company and the Trustee mutually covenant and agree for the benefit of the
Holders of the Notes as follows:

 

1.             Defined Terms. As used in
this Supplemental Indenture, terms defined in the Indenture or in the preamble
or recital hereto are used herein as therein defined. The words 

 

 

“herein,” “hereof” and “hereby” and other
words of similar import used in this Supplemental Indenture refer to this
Supplemental Indenture as a whole and not to any particular section hereof.

 

2.             Agreement to Guarantee. Each
New Guarantor hereby agrees, jointly and severally with all Existing
Guarantors, unconditionally, to guarantee the Notes and the obligations of the
Company under the Indenture and the Notes on the terms and subject to the
conditions set forth in Article XI of the Indenture and to be bound by (and
shall be entitled to the benefits of) all other applicable provisions of the
Indenture as a Guarantor.

 

3.             Termination, Release and
Discharge. Each New Guarantor’s Guarantee shall terminate and be of no
further force or effect, and each New Guarantor shall be released and
discharged from all obligations in respect of its Guarantee, only as and when
provided in Section 11.5 of the Indenture.

 

4.             Parties. Nothing in this
Supplemental Indenture is intended or shall be construed to give any Person,
other than the Holders and the Trustee, any legal or equitable right, remedy or
claim under or in respect of each New Guarantor’s Guarantee or any provision
contained herein or in Article XI of the Indenture.

 

5.             Governing Law. THIS
SUPPLEMENTAL INDENTURE, THE INDENTURE, THE GUARANTEES AND THE NOTES SHALL BE
GOVERNED BY AND CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK.

 

6.             Ratification of Indenture;
Supplemental Indentures Part of Indenture. Except as expressly amended
hereby, the Indenture is in all respects ratified and confirmed and all the
terms, conditions and provisions thereof shall remain in full force and effect.
This Supplemental Indenture shall form a part of the Indenture for all
purposes, and every Holder of Notes heretofore or hereafter authenticated and
delivered shall be bound hereby. The Trustee makes no representation or
warranty as to the validity or sufficiency of this Supplemental Indenture.

 

7.             Counterparts. The parties
hereto may sign one or more copies of this Supplemental Indenture in
counterparts, all of which together shall constitute one and the same
agreement.

 

8.             Headings. The section
headings herein are for convenience of reference only and shall not be deemed
to alter or affect the meaning or interpretation of any provisions hereof.

 

2

 

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

 

	
   

  	
  CPH SUB I CORPORATION, as Guarantor

  
	
   

  	
  CPH SUB II CORPORATION, as Guarantor

  
	
   

  	
  CPC SUB I CORPORATION, as Guarantor

  
	
   

  	
  VC SUB I CORPORATION, as Guarantor

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ SHIVANANDAN A. DALVIE

  	
   

  
	
   

  	
   

  	
  Name:

  	
  Shivanandan A. Dalvie

  
	
   

  	
   

  	
  Title:

  	
  Vice President, Assistant
  Secretary

  and Treasurer

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  COMPRESSION
  POLYMERS HOLDING CORPORATION

  
	
   

  	
  COMPRESSION
  POLYMERS HOLDING II CORPORATION

  
	
   

  	
  COMPRESSION
  POLYMERS CORP.

  
	
   

  	
  VYCOM CORP.

  
	
   

  	
  CPCAPITOL
  ACQUISITION CORP.

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ SCOTT C. HARRISON

  	
   

  
	
   

  	
   

  	
  Name:

  	
  Scott C. Harrison

  	
   

  
	
   

  	
   

  	
  Title:

  	
  Senior Vice President and
  Chief Financial Officer

  	
   

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  WELLS FARGO
  BANK, N.A., as Trustee

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ JOSEPH P. O’DONNELL

  	
   

  
	
   

  	
   

  	
  Name:

  	
  Joseph P.O’Donnell

  
	
   

  	
   

  	
  Title:

  	
  Vice President

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