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                                                                  Exhibit 10.422

                           PURCHASE AND SALE AGREEMENT

     THIS PURCHASE AND SALE AGREEMENT (this "AGREEMENT") is made and entered
into as of the 2nd day of November, 2004, by and among Zurich Towers, Inc an
Illinois corporation ("SELLER"), having its principal office and place of
business at 1400 E. American Lane, Schaumburg, Illinois, 60196 and Inland Real
Estate Acquisitions, Inc. ("BUYER"), an Illinois corporation or its affiliated
designee, having an office at 2901 Butterfield Road, Oak Brook, Illinois 60523.

                                    RECITALS

          A.   Seller is the owner of fee simple title to the land and
improvements known as 1400-1450 E. American Lane, Schaumburg, Illinois more
particularly identified on EXHIBIT A hereto.

          B.   Seller desires to sell the Property (as hereinafter defined) to
Buyer, and Buyer desires to acquire the Property from Seller, upon and subject
to the terms and conditions of this Agreement.

          C.   At the Closing (as hereinafter defined), Buyer is to lease the
Property to Seller's affiliate pursuant to the Lease Agreement attached as
EXHIBIT B hereto (the "LEASE").

     NOW THEREFORE, in consideration of and in reliance upon the above Recitals,
the terms, covenants and conditions contained in this Agreement, and other good
and valuable consideration, the receipt and sufficiency of which are hereby
acknowledged, Seller and Buyer agree as follows:

     1.   SALE OF PROPERTY

     Subject to the terms and conditions of this Agreement, Seller agrees to
sell to Buyer, and Buyer agrees to buy from Seller, the following described
property (individually or collectively as the context may require, the
"PROPERTY");

          A.   that certain tract of real estate described in EXHIBIT A,
together with all and singular the easements, covenants, agreements, rights,
privileges, tenements, hereditaments and appurtenances thereunto now or
hereafter belonging or appertaining thereto and all right, title and interest of
Seller (whether now or hereafter existing) in and to any land lying in the bed
of any street, alley, road or avenue (whether open, closed or proposed) within,
in front of, behind or otherwise adjoining the Land or any of it (collectively,
the "LAND"); and

          B.   all of the buildings, structures, fixtures, facilities,
installations and other improvements of every kind and description now or
hereafter in, on, over and under the Land, including, without limitation, any
and all plumbing, air conditioning, heating, ventilating, mechanical, electrical
and other utility systems, landscaping, roadways, sidewalks and security devices
(collectively, the "IMPROVEMENTS") (the Land and Improvements being collectively
referred to as the "PROPERTY"); and

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          C.   all fixtures, equipment, machinery, maintenance vehicles and
tools used in connection with the operation of the Property;

          D.   to the extent assignable, all licenses, permits and approvals of
any governmental authority and contracts pertaining to the use, operation and
maintenance of the Property, to the extent of Seller's rights therein (the
"CONTRACTS");

          E.   All existing guaranties and warranties (including, without
limitation, manufacturers' warranties relating to the Improvements) (the
"WARRANTIES"), all site plans, surveys, engineering and architectural drawings,
plans, specifications, landscaping plans and studies relating to the Land and/or
Improvements (collectively, the "PLANS AND STUDIES");

          F.   All books, records, keys and other materials used in connection
with Seller's ownership or interest in any of the above (collectively, the
"RECORDS"); and

          G.   Any other assignable rights affecting the Land and Improvements
that are necessary for the use, ownership, operation or maintenance of the
Property.

     Notwithstanding anything contained in this Article 1 Seller is not
conveying or agreeing to convey to Buyer the following items which are excluded
from the Property under this Agreement: any and all business equipment,
furniture, furnishings, supplies and other personally of a non-permanent nature
located within the Property (but not constituting Fixtures) owned by Seller or
any affiliate or lessee (collectively, the "EXCLUDED PROPERTY").

     2.   PURCHASE PRICE

     The purchase price for the Property is $138,000,000.00 (the "PURCHASE
PRICE") which shall be paid as follows:

          A.   $2,500,000 upon the execution and delivery of this Agreement by
Seller and Buyer by delivering to Chicago Title Insurance Company (the "Title
Company"), as escrow agent, by wire transfer in immediately available federal
funds, to the account provided by Title Company, the proceeds of which shall be
held in escrow on the terms and condition set forth in Section 10 hereof, and
$2,400,000 of which shall be the "Downpayment". From the $2,500,000.00, $100,000
shall be immediately wire transferred by the Title Company to Seller (to an
account provided by Seller). Notwithstanding anything herein to the contrary,
said $100,000 is not a part of the Downpayment, shall be non-refundable under
all circumstances (except if Seller defaults under this Agreement and Buyer
terminates the Agreement, in which case the $100,000 shall be returned to
Buyer), and shall be and remain (subject to the foregoing) the property of
Seller. At Closing, (if it occurs), said $100,000 shall be applied to the
Purchase Price; and

          B.   The balance, at Closing, by immediately available federal funds
wire transferred to an account or accounts designated by Seller in writing to
Buyer.

     3.   DUE DILIGENCE

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          Buyer acknowledges that Seller has engaged (i) Wiss, Janney, Elstner
Associates, Inc. to do a structural assessment of the Improvements (the
"Structural Report"), (ii) URS Corporation to do a phase one environmental site
assessment update (the "ESA"), (iii) Gremley & Biedermann to provide an
ALTA/ACSM land title survey (the "Survey"), and (iv) Environmental Systems
Design, Inc. to provide a mechanical, electrical, plumbing and fire protection
study with respect to the Improvements (the "MEP Report"). Buyer hereby
specifically acknowledges receipt of the engagement letters by which each of the
foregoing consultants has been retained and approves the scope of work covered
by such engagement letters and the specific vendor providing each of the
services set forth herein, except that the Survey Certification shall contain
(in addition to what is called for in the engagement letter for the Survey) ALTA
Table A items 7(b)(i) and 13 and shall also contain Certification 6 (to the
extent of zoning information of which the Surveyor is made aware).

          A.   TITLE

          (1)  Buyer shall have ten (10) calendar days from receipt of the
Survey and a title commitment, together with copies of all underlying exceptions
referenced therein (the "Title Commitment") from the Title Company to approve
the condition of title to the Property including, without limitation, all
exceptions, liens, encumbrances, easements, rights of way, survey exceptions,
conditions, covenants, restrictions and matters of record. All matters set forth
on the Title Commitment and/or the Survey shall be deemed Permitted Exceptions
unless, within ten (10) calendar days after receipt of the Title Commitment and
Survey Buyer provides reasonable objection to any item set forth in the Survey
or Title Commitment. Buyer hereby acknowledges receipt of the Title Commitment
and underlying exceptions.

          (2)  Buyer shall have no right to terminate this Agreement or fail to
close if at Closing the Title Company can issue a title policy (the "Title
Policy") insuring ownership in Buyer and subject only to the Permitted Exception
and such other exceptions that are reasonably acceptable to Buyer. Buyer shall,
at its election, obtain an update to the Title Commitment prior to the Closing
to confirm the condition of title.

     Any encumbrance or defect disclosed on any update, amendments, or
supplement to the Title Commitment not set forth on the Title Commitment and not
reasonably objected to by Buyer within the earlier of (i) two (2) business days
after receipt of such supplement, update or amendment, or (ii) the scheduled
Closing Date, shall be deemed waived as objections to title and shall be deemed
Permitted Exceptions; provided however, in no event shall Buyer be deemed to
accept any exception to title which Seller must remove or otherwise satisfy
pursuant to the terms of this Agreement. Any mortgage affecting the Property
shall be paid at or prior to Closing.

          (3)  Upon receipt of a timely notice of objection to title by Buyer
pursuant to the preceding paragraphs, Seller may, but shall not be obligated to,
adjourn the Closing for a period or periods, in the aggregate, not to exceed
thirty (30) days for the purpose of removing such liens, encumbrances, interests
or other matters to which Buyer has properly objected. Except as provided herein
to the contrary, (including Seller's obligation to pay all mortgages affecting
the property) nothing contained in this Agreement shall be construed to require
Seller to incur any expense in excess of $100,000, or to take any action or
commence any proceeding to remove any such liens, encumbrances, interests or
other matters or to otherwise render Seller's

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title marketable or insurable. In the event that Seller elects not to remove any
such liens, encumbrances, interests or other matters affecting title and which
would have an adverse effect on the value of the Property, but not set forth on
the Title Commitment, or otherwise fails to convey title to the Property in
accordance with the provisions of this Agreement, it being agreed that, except
as provided herein to the contrary, Seller is not required to remove objections
to title, this Agreement shall terminate in which case the sole obligation of
Seller shall be to instruct Escrow Agent to return the Downpayment, together
with any accrued interest thereon, to Buyer, and, upon such payment and such
return, this Agreement shall be of no further force and effect, neither party
shall have any further rights or obligations hereunder (except for those
provisions specifically stated to survive), and the lien, if any, on the
Property which may have been created by the delivery of the Downpayment and any
other sums which may be paid on account of this Agreement shall wholly cease.

          (4)  The existence of mortgages, liens or encumbrances, other than the
Permitted Exceptions, which Seller elects to remove, shall not be objections to
title provided that properly executed instruments, in recordable form, necessary
to satisfy the same are delivered to the Title Company or its agent, at the
Closing, together with any recording or filing fees required in connection
therewith, and the Title Company agrees to "omit" such mortgage, lien or
encumbrance. Any such mortgages, liens and encumbrances may be paid out of the
cash consideration to be paid by Buyer and, if a request is made in writing at
least one (1) business day prior to the Closing, Buyer agrees to provide at the
Closing separate official bank or certified checks, or separate wire transfers,
in such amounts and payable to such parties as requested to facilitate the
satisfaction of any such mortgages, liens or encumbrances and credited against
the Purchase Price. Notwithstanding anything contained herein to the contrary,
Seller shall pay and remove all mortgages and other voluntary liens placed on
the Property by Seller that affect the Property.

     In lieu of satisfying any liens or encumbrances required to be satisfied
under this Agreement, Seller may, at its option, either deposit with the Title
Company such sum of money or deliver to the Title Company such affidavits and
certificates as may be determined by the Title Company as being sufficient to
induce the Title Company, without additional premium (unless paid by Seller), to
insure Buyer's title without exception therefor or to affirmatively insure
against collection out of the Properties by reason thereof.

          B.   INSPECTIONS

          (1)  Buyer acknowledges that except as set forth in this subsection B,
Buyer has had the full opportunity to examine the Property, its physical and
environmental condition, the Lease, all agreements, laws, rules and regulations
affecting the foregoing and all other elements of the Property and is familiar
and satisfied with all of the foregoing. Seller makes no representation or
warranty with regard to the accuracy, completeness or validity of any document
now or hereafter delivered to Buyer, except that all documents delivered to
Buyer to which Seller is a signatory are true, correct and complete copies, to
Seller's knowledge. Seller has not made and does not make any representations as
to zoning, compliance with laws, the physical condition (including, without
limitation, the environmental condition), structure, expenses, value of the
Land, value of the Improvements, the adequacy or fitness for use of any
mechanical equipment or any other matter affecting or related to the Property or
this transaction, which

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might be pertinent in considering the purchase of the Property or the entering
into of this Agreement, except as specifically set forth in this Agreement, and
Buyer hereby expressly acknowledges that no such representations have been made,
and Buyer further acknowledges that it has inspected the Property and agrees to
take the same "AS IS," in such condition as the same may be in on the date
hereof, including reasonable wear and tear to the Closing Date. Seller is not
and will not be liable or bound in any manner by expressed or implied
warranties, guaranties, promises, statements, representations or information
pertaining to the Property made or furnished by any real estate broker, agent,
employee, servant or other person representing or purporting to represent
Seller, unless the same are specifically set forth in this Agreement. All
understandings and agreements heretofore had between the parties hereto are
merged in this Agreement which alone fully and completely expresses their
agreement, and the same has been entered into after full investigation, neither
party relying upon any statement or representation not embodied in this
Agreement, made by or on behalf of the other. No warranty or representation
contained in this Agreement shall survive the Closing unless specifically stated
herein so to survive.

          (2)  Buyer shall have ten (10) calendar from receipt of the ESA to
provide notice to Seller of Buyer's reasonable rejection of the environmental
condition of the Property as set forth in said report. Silence shall be deemed
Buyer's acceptance of the condition of the Property. In the event Buyer
reasonably objects to the environmental condition of the Property as set forth
in said report and provides timely notice thereof to Seller, this Agreement
shall terminate as of the date of Seller's receipt of said notice and be of no
further force or effect and all obligations of Seller and Buyer hereunder shall
terminate (except those which expressly survive), and Seller shall cause the
Downpayment to be returned to Buyer.

          (3)  Buyer shall have ten (10) calendar days after receipt of the
Structural Report and the MEP Report to provide notice to Seller of Buyer's
reasonable rejection of the physical condition of the Improvements as set forth
in either of said reports. Silence shall be deemed Buyer's approval of the
physical condition of the Improvements. In the event Buyer reasonably objects to
the physical condition of the Improvements as set forth in either of said
reports, and provides timely notice thereof to Seller (which notice shall state
with specificity the reasons for such objection), then, subject to the following
paragraph, the Agreement shall terminate and be of no further force or effect,
Seller shall cause the Downpayment to be returned to Buyer, and all obligations
of the parties hereto shall terminate (except those obligations which are
expressly stated to survive).

          (4)  Notwithstanding the foregoing, in the event Buyer does not accept
the condition of the Property as set forth in the Structural Report or the MEP
Report, Buyer shall set forth with specificity its reasons for rejecting either
of said reports. Seller shall have five (5) days after receipt of such notice of
rejection to deliver to Buyer a letter from the lessee under the Lease,
confirming lessee's agreement with results of the report, and as objected to by
Buyer, and agreeing that lessee shall promptly undertake all repairs required to
remedy the problem set forth is such report. In such event, this Agreement shall
remain in full force and effect and the parties proceed to Closing. In the event
Seller fails to provide such notice, this Agreement shall terminate as set forth
above.

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          C.   APPRAISAL

          (1)  Buyer shall have until November 15, 2004 to obtain at its sole
cost expense, an appraisal of the Property from an appraiser reasonably
acceptable to Seller. In the event Buyer receives (and delivers to Seller) an
appraisal from an appraiser reasonably acceptable to Seller by November 15, 2004
which reflects a Fair Market Sales Value (as defined in the Lease but taking
into consideration the Lease), for the Property less than 95% of the Purchase
Price, Buyer shall have the right to terminate this Agreement and receive a
refund of its Downpayment unless, within ten (10) days of receipt of said
appraisal Seller agrees to reduce the Purchase Price to an amount equal to 105%
of such appraised value of the Property, as leased. Seller shall be under no
obligation to make such an adjustment.

          (2)  In the event Buyer does not receive an appraisal by the date set
forth herein, or receives such report but fails to object thereto by the date
set forth herein, Buyer shall be deemed to irrevocably waive its right to
terminate this Agreement arising out of the terms of any appraisal, and shall
proceed to Closing. Buyer specifically acknowledges that it has no right to
terminate this Agreement except as specifically set forth herein. If the
appraisal reflects a Fair Market Sales Value (taking into consideration the
Lease) of at least 95% of the Purchase Price, Buyer shall have no right to
object thereto, and the Agreement shall continue in full force and effect and
Buyer shall proceed to Closing.

If the appraisal does reflect a Fair Market Sales Value less than 95% of the
Purchase Price (taking into consideration the Lease), and Buyer timely objects
thereto and Seller does not agree to reduce the Purchase Price, as set forth
above, this Agreement shall terminate and be of no further force or effect,
Seller shall cause the Downpayment to be returned to Buyer, and all obligations
of Buyer and Seller shall terminate (except for those obligations which are
expressly stated to survive).

          D.   Seller agrees to provide reasonable access to the Property to
Buyer and its permitted consultants, upon reasonable prior notice, and subject
to the rights of all occupants and tenants in possession. In no event shall
Buyer or its consultants have any right to perform any invasive test on, in or
under the Property, or unreasonably disturb the operation of the Property or of
its tenants and occupants.

     4.   CLOSING

          A.   CLOSING DATE

     The closing (the "CLOSING") of the transaction contemplated by this
Agreement (that is, the payment of the Purchase Price, the conveyance of title
to the Property, and the satisfaction of all other terms and conditions of this
Agreement) shall occur on November 30, 2004 (the "CLOSING DATE") at a location
to be reasonably agreed to by the parties.

          B.   CLOSING DOCUMENTS

          (1)  SELLER. At the Closing, Seller shall execute and deliver to Buyer
     (or otherwise deliver or cause to be delivered to Buyer) the following
     documents (originals, acknowledged and in recordable form, where
     applicable) for the Property:

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               (a)  a special warranty deed ("Deed") subject only to the
     Permitted Exceptions, sufficient to transfer and convey to Buyer fee simple
     title to the applicable Property as required by this Agreement, with
     covenants against grantor's acts,

               (b)  a bill of sale, sufficient to transfer to Buyer title to
     personal property and containing a warranty that such property is owned by
     Seller free and clear of all liens, but containing no other representations
     or warranties;

               (c)  to the extent in such Seller's possession or control, any
     and all building plans, surveys, site plans, engineering plans and studies,
     utility plans, landscaping plans, development plans, specifications, and
     all other similar documentation concerning all or any part of the Property
     (but such items shall be retained by Seller and used by lessee pursuant to
     the Lease);

               (d)  any bonds, warranties or guaranties which are in any way
     applicable to the Property, including without limitation, those from any
     contractors, subcontractors, suppliers or materialmen in connection with
     any construction, repair or alteration of the Improvements or systems (but
     such items shall be retained by Seller and used by lessee pursuant to the
     Lease);

               (e)  affidavits or indemnities sufficient to delete any
     exceptions for parties in possession and mechanics' or materialmen's liens
     from the Title Policy, and such other customary affidavits or indemnities
     relating to the Title Policy as the Title Company may reasonably request;

               (f)  such evidence of Seller's authority, existence and standing,
     sufficient to delete any exception to the Title Policy on account of
     Seller's authority, existence and standing;

               (g)  a Seller's affidavit, stating, under penalty of perjury,
     Seller's U.S. taxpayer identification number and that Seller is not a
     foreign person within the meaning of Section 1445 of the Internal Revenue
     Code and similar form required under any state law; and

               (h)  any and all transfer tax forms required by any state or
     local law, executed by Seller

               (i)  four originals of the Lease, executed by Seller's affiliate;

               (j)  four originals of a subordination, non-disturbance and
     attornment agreement in a form reasonable acceptable to Seller, and to the
     extent requested by Buyer;

               (k)  four originals of a Memorandum of Lease relating to the
     Lease, in form and content reasonably acceptable to Seller;

               (l)  the estoppel certificate in the form required by the Lease;
     and

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               (m)  all other documents reasonably required by Buyer in order to
     effect the conveyance, transfer and assignment of the Property to Buyer
     pursuant to the terms hereof.

     (2)  BUYER. At the Closing, Buyer shall deliver or cause to be delivered to
Seller:

               (a)  the Purchase Price as required pursuant to SECTION 2 hereof;

               (b)  executed counterparts of the documents listed in Section
     4(B)(i) hereof that are required to be signed by Buyer, including, without
     limitation, under Section 4B(h), (i) (j), and (k); and

               (c)  such evidence of Buyer's authority, existence and good
     standing as Seller reasonably requests, and

               (d)  all other documents reasonably required by Seller in order
     to effect the transaction contemplated herein.

          C.   SELLER CLOSING COSTS

     Seller shall be responsible for: (i) any and all transfer taxes due in
connection with the transfer of the Property to Buyer; (ii) all documentary
stamps, intangible and sales taxes as well as any other taxes or charges due in
connection with the transactions contemplated hereby; (iii) all costs necessary
to deliver title to the Property in accordance with the terms of this Agreement,
including the premium for the Title Policy and endorsement charges; (iv) all
survey costs for a current ALTA survey; (v) Seller's fees for its attorneys and
consultants, including for preparation of the ESA, Structural Report and MEP
Report; and (vi) the brokerage commission due to the Broker (as hereinafter
defined) pursuant to a separate written agreement between Seller and the Broker.

          D.   BUYER'S COSTS

     Buyer shall be responsible for: (i) Buyer's inspections, appraisal and
Buyer's other due diligence costs; (ii) Buyer's fees for its attorney and
consultants; and (iii) all costs arising out of Buyer's financing of any portion
of the Purchase Price, including, without limitation, mortgage taxes and
recording costs, title premiums, lender, trustee and servicer costs and fees,
costs to record the Memorandum of Lease, debt placement fees and independent
director fees.

          E.   LEASE. At the Closing, Buyer shall lease the Property to Seller's
affiliate and Seller's affiliate shall lease the Property from Buyer pursuant to
the terms of the Lease. Seller agrees to cause its affiliate to execute and
deliver the Lease, and Buyer agree to execute and deliver the Lease, at the
Closing with a guaranty from the parent rated company.

          F.   APPORTIONMENTS. All taxes, assessments, utility charges (but not
utility deposits, what shall remain Seller's property), costs under any service
or maintenance contracts and rents shall be apportioned as of the closing. All
costs to be Buyers's based on such apportionment shall become the responsibility
of lessee under the Lease.

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     5.   REPRESENTATIONS AND WARRANTIES

          A.   Seller represents and warrants that the following are true,
complete and correct:

          (1)  DUE ORGANIZATION. Seller is a corporation duly organized, validly
existing and in good standing in the State of Illinois and qualified to do
business in, and in good standing, in the State of Illinois. Seller has the
corporate power and authority to conduct its business as now conducted, to sell
the Property and to enter into and perform its obligations under this Agreement
and the documents to be delivered hereby to which it is or is to become a party
("Operative Documents").

          (2)  DUE AUTHORIZATION; NO CONFLICT. Each of the Operative Documents
to which Seller is a party has been duly authorized by all necessary corporate
action on the part of Seller and has been duly executed and delivered by Seller,
and the execution, delivery and performance thereof by Seller will not, (i)
require any approval of the stockholders of Seller or any approval or consent of
any trustee or holder of any indebtedness or obligation of Seller, other than
such consents and approvals as have been obtained, (ii) contravene any law
binding on Seller or (iii) contravene or result in any breach of or constitute
any default under Seller's charter or by-laws or other organizational documents,
or any indenture, judgment, order, mortgage, loan agreement, contract,
partnership or joint venture agreement, lease or other agreement or instrument
to which Seller is a party or by which Seller is bound.

          (3)  GOVERNMENTAL ACTIONS, All governmental action required in
connection with the execution, delivery and performance by Seller of the
Operative Documents to which it is a party has been or will have been obtained,
given or made.

          (4)  ENFORCEABILITY. Each of the Operative Documents to which Seller
is or is to become a party constitutes the legal, valid and binding obligation
of Seller, enforceable against Seller in accordance with the terms thereof,
except as enforceability may be limited by bankruptcy, moratorium, fraudulent
conveyance, insolvency, equitable principles or other similar laws affecting the
enforcement of creditors' rights in general.

          (5)  BANKRUPTCY, No bankruptcy, reorganization, arrangement or
insolvency proceedings are pending, threatened or contemplated by Seller, and
Seller has not made a general assignment for the benefit of creditors.

          (6)  TAX FILINGS. All tax returns and reports of Seller required by
law to be filed with respect to the Property have been duly filed, and all
taxes, interests and penalties assessed by any governmental authority upon the
Property or Seller (with respect to the Property), which are due and payable,
have been paid, except to the extent being contested in good faith by the
Seller, or except to the extent failure to so file or pay such taxes would not
have a material adverse effect on the Property or Seller.

          (7)  ENVIRONMENTAL CONDITIONS. To the Seller's knowledge, there are no
circumstances or conditions with respect to the Property not revealed in the
Environmental Report that render the Property in violation (other than to a de
minimis effect) of any applicable environmental laws.

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          (8)  LEGAL PROCEEDINGS. There are no pending or to the Seller's
knowledge, threatened actions, suits or proceedings by or before any court or
governmental authority against or affecting the Seller with respect to the
Property (including, without limitation, any action in condemnation or eminent
domain) that, if determined adversely to Seller or the Property, would
materially and adversely affect the value of the Property.

          (9)  LICENSES AND PERMITS. To the Seller's knowledge, (i) it possesses
all material licenses, permits and authorizations required by applicable law for
the operation of the Property and (ii) all such licenses, permits and
authorizations are valid and in full force and effect.

The phrase "the Seller's knowledge" and other words and phrases of like import
shall mean the actual slate of knowledge of Dusty Dastur. Seller represents that
the foregoing individuals are the people who are likely to know of any matters
covered by these representations and warranties.

          B.   Buyer represents and warrants to Seller that the following are
true, complete and correct:

          (1)  DUE ORGANIZATION. Buyer is a corporation duly organized, validly
existing and in good standing in the State of Illinois and qualified to do
business in, and in good standing, in the State of Illinois. Buyer has the power
and authority to conduct its business as now conducted, to sell the Property and
to enter into and perform its obligations under this Agreement and the documents
to be delivered hereby to which it is or is to become a party ("Operative
Documents").

          (2)  DUE AUTHORIZATION; NO CONFLICT. Each of the Operative Documents
to which Buyer is a party has been duly authorized by all necessary corporate
action on the part of Buyer and has been duly executed and delivered by Buyer,
and the execution, delivery and performance thereof by Buyer will not, (i)
require any approval of the stockholders of Buyer or any approval or consent
of any trustee or holder of any indebtedness or obligation of Buyer, other than
such consents and approvals as have been obtained, (ii) contravene any law
binding on Buyer or (iii) contravene or result in any breach of or constitute
any default under Buyer's charter or by-laws or other organizational documents,
or any indenture, judgment, order, mortgage, loan agreement, contract,
partnership or joint venture agreement, lease or other agreement or instrument
to which Buyer is a party or by which Buyer is bound.

          (3)  GOVERNMENTAL ACTIONS. All governmental action required in
connection with the execution, delivery and performance by Buyer of the
Operative Documents to which it is a party has been or will have been obtained,
given or made.

          (4)  ENFORCEABILITY. Each of the Operative Documents to which Buyer is
or is to become a party constitutes the legal, valid and binding obligation of
Buyer, enforceable against Buyer in accordance with the terms thereof, except as
enforceability may be limited by bankruptcy, moratorium, fraudulent conveyance,
insolvency, equitable principles or other similar laws affecting the enforcement
of creditors' rights in general.

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          (5)  BANKRUPTCY. No bankruptcy, reorganization, arrangement or
insolvency proceedings are pending, threatened or contemplated by Buyer, and
Buyer has not made a general assignment for the benefit of creditors.

          C.   The foregoing warranties and representations of Buyer and Seller
shall survive the execution and delivery of this Agreement and the Closing for a
period of one (1) year. Any claim for a breach of a representation or warranty
not made by the filing of a judicial action within one (1) year from the Closing
shall be deemed waived.

     6.   CONDITIONS PRECEDENT

          A.   At the option of Buyer, the obligations of Buyer under this
Agreement are contingent and conditioned upon the satisfaction of the following
conditions precedent at the Closing or such other time specified herein, the
failure of any of which shall, at the request of Buyer render this Agreement
null and void:

          (1)  Each and every representation and warranty of Seller is true,
correct and complete in all material respects as of the Closing.

          (2)  As of the Closing, Seller shall have fully performed and
satisfied in all material respects each and every obligation, term and condition
to be performed and satisfied by Seller under this Agreement.

          (3)  As of the Closing, the Title Insurer shall have delivered to
Buyer the Title Policy (or a marked-up and executed commitment therefor)
insuring fee simple title to the Property in Buyer in the amount of the Purchase
Price subject only to Permitted Exceptions, and otherwise in the form and
condition required by this Agreement.

          B.   At the option of Seller, the obligations of Seller under this
Agreement are contingent and conditioned upon the satisfaction of the following
conditions precedent at the Closing or such other time specified herein, the
failure of any of which shall, at the request of Seller render this Agreement
null and void:

          (1)  Each and every representation and warranty of Buyer is true,
correct and complete in all material respects as of the Closing.

          (2)  As of the Closing Buyer shall have fully performed and satisfied
in all material respects each and every obligation, term and condition to be
performed and satisfied by Buyer under this Agreement.

     7.   BROKERAGE

     Seller and Buyer represent and warrant each to the other that they have not
dealt with any real estate broker, sales person or finder in connection with
this transaction other than CB Richard Ellis (the "BROKER"). In the event of any
claim for broker's or finder's fees or commissions in connection with the
negotiation, execution or consummation of this Agreement or the transactions
contemplated hereby (other than those due to the Broker), each party shall
indemnify and hold harmless the other party from and against any and all claims
of all brokers

     11
<Page>

and finders claiming by, through or under the indemnifying party and in any way
related to the transaction regarding the Property pursuant to this Agreement,
including, without limitation, attorneys fees incurred by the other party in
connection with such claims. Seller shall pay all commissions due to the Broker
pursuant to a separate agreement between Seller and the Broker.

     8.   CASUALTY OR CONDEMNATION

          A.   Subject to the terms of Paragraph B below, in the event of (i)
any destruction or damage to the Property by fire or other casualty, the cost of
which to repair, as reasonably determined by Seller, is less than $10,000,000,
or (ii) the taking of a portion of the Property by condemnation or eminent
domain which does not adversely affect the Property in any material way, prior
to the Closing, this Agreement shall remain in full force and effect and neither
party shall have any right to terminate the same as the result thereof, nor
shall there be any abatement to the Purchase Price. At the Closing Seller shall
pay (to the extent in its possession) or assign to Seller's affiliate under the
Lease all of Seller's right, title and interest in and to all net insurance
proceeds payable as a result of such casualty or damage, to be applied as set
forth in the Lease. In addition, all net proceeds of any condemnation or eminent
domain received by Seller or payable to Seller, arising out of any eminent
domain or condemnation action after the date hereof but prior to the Closing
shall be allocated as set forth in the Lease. Any condemnation award or
insurance proceeds payable arising out of any casualty or condemnation that has
occurred prior to the date hereof shall remain the property of Seller. Seller
shall control any negotiations with the insurance company or condemning
authority prior to the Closing.

          B.   Notwithstanding the foregoing, in the event of (i) any
destruction or damage to the Property by fire or other casualty which Seller
reasonably estimates will cost more than $10,000,000 to repair, or (ii) the
taking of all or any portion of the Property by condemnation or eminent domain
which materially and adversely affects the Property, prior to the Closing, then
either Seller or Buyer shall have the right to terminate this Agreement. If
either Party elects to terminate this Agreement, the Buyer shall receive a
refund of the Downpayment and all of the obligations of the parties hereunder
shall terminate, except as expressly set forth herein to the contrary. Buyer and
Seller must elect to terminate this Agreement within ten (10) days of receipt of
notice of damage or destruction or condemnation. Silence shall be deemed such
party's waiver of its right to terminate the Agreement. If the Agreement is to
continue, the proceeds of insurance or condemnation, as applicable shall be
disbursed as set forth in Subsection A above.

     9.   MISCELLANEOUS

          A.   Neither this Agreement nor any interest hereunder shall be
assigned or transferred by Seller or Buyer.

          B.   This Agreement constitutes the entire agreement between Seller
and Buyer with respect to the Property and shall not be modified or amended
except in a written document signed by Seller and Buyer. Any prior agreement or
understanding between Seller and Buyer concerning the Property is hereby
rendered null and void.

     12
<Page>

          C.   If any of Seller' representations, covenants and warranties
contained in this Agreement shall not, to the actual knowledge of Buyer, be
true, correct and complete in all material respects upon the Closing, Buyer may
proceed to the Closing but shall thereby waive any claim against Seller in a
breach of such representation or warranty any rights whatsoever.

          D.   In the computation of any period of time provided for in this
Agreement or by law, the day of the act or event from which the period of time
runs shall be excluded, and the last day of such period shall be included,
unless it is a Saturday, Sunday, or legal holiday, in which case the period
shall be deemed to run until the end of the next day which is not a Saturday,
Sunday, or legal holiday.

          E.   All notices, requests, demands or other communications required
or permitted under this Agreement shall be in writing and delivered personally
or by facsimile transmission, or by overnight courier (such as Federal Express),
addressed as follows:

          If to Seller:       Zurich Towers, Inc.
                              1400 E. American Lane
                              Schaumburg, Illinois 60196
                              Attention:  T1 -19 Treasury
                              Telephone:  (847) 605-6447
                              Facsimile:  (847) 605-7895

          With copy to:       Kramer Levin Naftalis & Frankel LLP
                              919 Third Avenue
                              New York, New York 10022
                              Attention: Neil Tucker, Esq.
                              Telephone: (212) 715-9259
                              Facsimile: (212) 715-8000

          If to Buyer:        Inland Real Estate Acquisitions, Inc.
                              2901 Butterfield Road
                              Oak Brook, Illinois 60523
                              Attention: G. Joseph Cosenza, Vice Chairman
                              Telephone: (630) 218-4948
                              Facsimile: (630) 218-4935

          With copy to:       The Inland Real Estate Group, Inc.
                              2901 Butterfield Road
                              Oak Brook, Illinois 60523
                              Attention: Gary Pechter, Esq.
                              Telephone: (630) 645-2084
                              Facsimile: (630) 218-4900

     All notices given in accordance with the terms hereof shall be deemed given
when served, if by person or telecopy, or the next business day if by recognized
overnight courier. Either party hereto may change the address for receiving
notices, requests, demands or other communication by notice sent in accordance
with the terms of this SECTION 9(E).

     13
<Page>

          F.   All questions concerning the construction, validity and
interpretation of this Agreement shall be governed and interpreted in accordance
with the laws of the State of Illinois. Buyer and Seller hereby expressly
consent to the exclusive jurisdiction of any state or federal court in Cook
county, Illinois for any claim arising out of this Agreement, and hereby waive
any and all objections to such venue. Each party hereby agrees to waive any
trial by jury. In the event of any dispute arising out of this Agreement the
prevailing party in said suit shall be entitled to collect from the unsuccessful
party its reasonable costs of suit including, without limitation, attorneys'
fees and costs.

          G.   This Agreement may be executed in any number of identical
counterparts, any or all of which may contain the signatures of fewer than all
of the parties but all of which shall be taken together as a single instrument.

          H.   Each party hereto agrees to maintain in confidence, and not to
discuss with or to disclose to any person or entity who is not a party to this
Agreement, any material term of this Agreement or any aspect of the transactions
contemplated hereby, except as provided in this Section. Except as provided
below, Buyer shall not disclose to anyone the property documentation and/or any
information disclosed by Seller to Buyer regarding Seller' operations and/or the
Property. Each party hereto may discuss with and disclose to its accountants,
attorneys, existing or prospective lenders, investors, investment bankers,
underwriters, rating agencies, partners, consultants and other advisors to the
extent such parties reasonably need to know such information and agree to the
confidentiality obligation created by this Section. This provision shall survive
termination of this Agreement but shall terminate upon the Closing. Any press
release to be made regarding any matter which is the subject of the
confidentiality obligation created in this Section shall be subject to the
reasonable approval of Buyer and the Seller, respectively, both as to timing and
content.

          I.   Buyer shall indemnify, hold harmless and defend Seller from and
against all loss, liability, damage, and cost (including without limitation,
attorneys' fees and disbursements) arising out of death, bodily injury or
property damage resulting from any act of Buyer or Buyer's consultants in
connection with any due diligence, or breach of any covenant of Buyer hereunder.
The foregoing indemnity shall survive the Closing or, if the Closing does not
occur, the termination of this Agreement.

          J.   If the transaction contemplated in this Agreement is not
consummated for any reason whatsoever, Buyer shall return to Seller any and all
documents, operating statements and other information it has received from
Seller in connection with the transaction contemplated by this Agreement
(collectively, the "PROPERTY INFORMATION"). The provisions of this SECTION 9J
shall survive the termination of this Agreement.

          K.   This Agreement contains all of the terms agreed upon between the
parties with respect to the subject matter hereof and supersedes any and all
prior written or oral understandings. This Agreement may not be changed,
modified or terminated except by an instrument executed by the parties hereto.

          L.   In no event shall Seller have any personal liability under this
Agreement. In the event of a default by Seller hereunder, Buyer as its sole
remedy shall have the right to

     14
<Page>

terminate this Agreement (by notice to Seller) and seek an action for specific
performance, or recover the Downpayment. The provisions of this SUBSECTION L
shall survive the closing or earlier termination of this Agreement.

          M.   No waiver of any breach of any agreement or provision herein
contained shall be deemed a waiver of any preceding or succeeding breach thereof
or of any other agreement or provision herein contained. No extension of time
for performance of any obligations or acts shall be deemed an extension of the
time for performance of any other obligations or acts.

          N.   This Agreement shall be binding upon and inure to the benefit of
Seller, Buyer and their respective successors and permitted assigns and Escrow
Agent and its successors and assigns.

          O.   Whenever the context shall require, the singular shall include
the plural, the plural shall include the singular and words of either gender
shall be deemed to include words of the other gender.

          P.   The headings of the various Articles of this Agreement have been
inserted only for the purpose of convenience, and are not part of this Agreement
and shall not be deemed in any manner to explain, qualify, or restrict any of
the provisions of this Agreement.

          Q.   Seller and Buyer hereby acknowledge that neither this Agreement
nor any memorandum thereof shall be recorded.

          R.   The acceptance by Buyer of the Deed shall be deemed an
acknowledgment by Buyer that Seller has complied fully with all of its
obligations hereunder and that Seller is discharged therefrom and that Seller
shall have no further obligation or liability with respect to any of the
agreements made by Seller in this Agreement, except for those provisions of this
Agreement which expressly provide that such obligation of Seller shall survive
the Closing. Except as otherwise expressly provided herein, any and all rights
of action of Buyer for any breach by Seller of any representation, warranty or
covenant contained in this Agreement shall merge with the Deed and other
instruments executed at Closing, shall terminate at the Closing and shall not
survive the Closing except for those provisions of this Agreement which
expressly provide that such obligations of Seller shall survive Closing.

          S.   Buyer hereby acknowledges that its obligation to pay the Purchase
Price in accordance with Article 2 hereof is not contingent on obtaining
financing or the granting of a mortgage.

          T.   In the event that Buyer shall fail to Close as required by this
Agreement, the parties hereto agree that the damages that Seller shall sustain
as a result thereof shall be substantial but shall be difficult to ascertain.
The parties hereto therefore agree that in the event that Buyer fails to close
as required herein, Seller shall be entitled to receive and retain the Down
Payment, together with any interest accrued thereon (and the parties shall
jointly instruct the Escrow Agent to promptly deliver said funds to Seller), as
and for its sole and exclusive remedy hereunder, as Seller's liquidated damages,
this Agreement shall terminate and neither Seller nor Buyer shall thereafter
have any further liability or obligation to the other hereunder, except for

     15
<Page>

such liabilities or obligations which are specifically stated to survive the
termination of this Agreement. The provisions of this SECTION 9T shall survive
the Closing or earlier termination of this Agreement.

          U.   Buyer acknowledges that the Federal ID Number of Buyer shall be
furnished to the banking institution in which the Down Payment shall be
deposited and that Buyer shall be responsible for all taxes on any interest
earned on the Down Payment. Buyer is delivering to Seller simultaneously
herewith an executed Form W-9.

     10.  ESCROW INSTRUCTIONS

          A.   The Downpayment shall be deposited in an interest bearing account
at Chicago Title Insurance Company or in any commercial bank reasonably selected
by Escrow Agent of which Escrow Agent gives Buyer notice. Any interest earned on
the Downpayment shall be the property of the party entitled to the Downpayment.

          B.   Escrow Agent shall deliver the Down payment to Seller or to
Buyer, as the case may be, upon the following conditions:

          (1)  to or at the direction of Seller, at the Closing, without further
instruction; or

          (2)  to Seller, as liquidated damages, upon receipt of written demand
therefor signed by Seller, stating that Buyer has defaulted in the performance
of its obligations under this Agreement and Seller has terminated this Agreement
on account of said default of Buyer (it being agreed by Buyer that the
Downpayment is a fair and reasonable amount and is not a penalty); provided,
however, that Escrow Agent shall not honor such demand until not less than five
(5) business days after the date on which Escrow Agent shall have delivered a
copy of such demand to Buyer, nor thereafter if during such five (5) business
days period Escrow Agent shall have received written notice of objection from
Buyer in accordance with the provisions of this Section;

          (3)  to Buyer, upon receipt of written demand therefor signed by
Buyer, stating that: (a) this Agreement has been terminated and that Buyer is
entitled under this Agreement to the return of the Downpayment theretofore
received by Escrow Agent; or (b) Seller has defaulted in the performance of its
obligations under this Agreement and Buyer has terminated this Agreement on
account of said default of Seller; provided, however, that Escrow Agent shall
not honor such demand in either case until not less than five (5) business days
after the date on which Escrow Agent shall have delivered a copy of such demand
to Seller, nor thereafter if during such five (5) business day period Escrow
Agent shall have received written notice of objection from Seller in accordance
with the provisions of this Section.

          C.   Any notice, demand or request to Escrow Agent shall,
notwithstanding anything to the contrary set forth herein or otherwise, be
sufficient only if received by Escrow Agent within the applicable time period
set forth herein, if any. Notices, demands and requests to Escrow Agent shall be
delivered by hand delivery or by overnight courier to Chicago Title Insurance
Company, 171 North Clark Street, Division 2, 3rd Floor, Chicago, Illinois
60601-3294, Attn: Nancy Castro (312) 223-2709 and fax (312) 223-2108, in the
manner aforesaid.

     16
<Page>

Notices, demands and requests from Escrow Agent to Seller or Buyer shall be
forwarded to them at their respective addresses set forth herein, in the manner
set forth herein.

          D.   Upon receipt of a written demand for the Downpayment made by
Buyer or Seller Escrow Agent shall promptly deliver or mail a copy thereof (in
the manner aforesaid) to the other party. The other party shall have the right
to object to the delivery of the Downpayment by written notice of objection
within five (5) business days after the date of receipt by the other party of
Escrow Agent's notice, but not thereafter. Upon receipt of such notice of
objection, Escrow Agent shall promptly deliver or mail a copy thereof (in the
manner aforesaid) to the party who made the written demand.

          E.   If:  (i) Escrow Agent shall have received a notice of objection
as provided herein, within the time therein prescribed; or (ii) any other
disagreement or dispute shall arise between the parties hereto and/or any other
persons resulting in adverse claims and demands being made for the Downpayment,
whether or not litigation has been instituted, then Escrow Agent shall refuse to
comply with any claims or demands on it and continue to hold the Downpayment
until Escrow Agent receives either: (x) a written notice signed by both Seller
and Buyer directing the disbursement of the Downpayment; or (y) a final order,
which is not (or is no longer) appealable, of a court of competent jurisdiction,
entered in a proceeding in which Seller and Buyer are named as parties,
directing the disbursement of the Downpayment, in either of which events Escrow
Agent shall then disburse the Downpayment in accordance with said direction.
Escrow Agent shall not be or become liable in any way or to any person for its
refusal to comply with any such claims or demands until and unless it has
received a direction of the nature described in clause (x) or clause (y) of this
paragraph. Notwithstanding the foregoing provisions of this Section or
otherwise, Escrow Agent shall have the following rights: (A) if Escrow Agent
shall have received a written notice signed by either Seller or Buyer advising
that a litigation between Seller and Buyer over entitlement to the Downpayment
has been commenced, Escrow Agent may, on notice to Seller and Buyer, deposit the
Downpayment with the Clerk of the Court in which said litigation is pending; or
(B) Escrow Agent may, on notice to Seller and Buyer, take such affirmative steps
as it may, at its option, elect in order to terminate its duties as Escrow
Agent, including, without limitation, the deposit of the Downpayment with a
court of competent jurisdiction and the commencement of an action for
interpleader, the costs thereof to be borne by whichever of Seller or Buyer is
the losing party.

          F.   Upon the taking by Escrow Agent of any action permitted herein,
Escrow Agent shall be released of and from all liability hereunder except for
any gross negligence or willful default. Except as otherwise provided in this
Section, all costs and expenses incurred by Escrow Agent in performing its
duties as Escrow Agent, including, without limitation, attorney's fees (either
paid to retained attorneys or amounts representing the fair value of legal
services rendered to or for itself) shall be borne equally by Seller and Buyer.

          G.   Escrow Agent acts hereunder as a depository only and is not
responsible or liable in any manner whatsoever for: (i) the sufficiency,
correctness, genuineness, collection or validity of any instrument deposited
with it; (ii) the form of execution of such instruments; (iii) the identity,
authority or rights of any person executing or depositing the same; (iv) the
terms and conditions of any instrument pursuant to which the parties may act; or
(v) the loss of the Downpayment or any interest (due to early presentation for
payment, insolvency of the Bank

     17
<Page>

in which the Downpayment is placed or otherwise), except for its gross
negligence or willful default.

          H.   Escrow Agent shall not have any duties or responsibilities except
those set forth herein, and shall not incur any liability in acting upon any
signature, notice, request, waiver, consent, receipt or other paper or document
believed by Escrow Agent to be genuine, and Escrow Agent may assume that any
person purporting to give it any notice on behalf of any party in accordance
with the provisions hereof has been duly authorized to do so, except that this
will not relieve Escrow Agent of liability for its gross negligence or willful
default.

          I.   The terms and provisions of this Section shall create no right in
any person, firm or corporation other than the parties hereto and their
respective successors and assigns, and no third party shall have the right to
enforce or benefit from the terms hereof.

          J.   Escrow Agent has executed this Agreement for the sole purpose of
agreeing to act as such in accordance with the terms of this Section.

     18
<Page>

          IN WITNESS WHEREOF, the parties have caused this Agreement to be
executed as of the date first above written by their duly authorized
representatives.

                                        SELLER:

                                        Zurich Towers, Inc.

                                        an Illinois Corporation

                                        By: /s/ Mary Fran Callahan
                                           ---------------------------------
                                        Name:  Mary Fran Callahan
                                        Title: Vice President - Treasurer

                                        By: /s/ Thomas A. Bradley
                                           ---------------------------------
                                        Name:  Thomas A. Bradley
                                        Title: Chief Financial Officer

     19
<Page>

                                        BUYER:

                                        Inland Real Estate Acquisitions, Inc.
                                        an Illionis corporation

                                        By: /s/ G. Joseph Cosenza
                                           ------------------------------
                                        Name:  G. Joseph Cosenza
                                        Title: President

ESCROW AGENT:

[Chicago Title Insurance Company]

By:  /s/ Nancy R. Castro
    ---------------------------------

Its: AVP
    ---------------------------------
with respect to Section 10 hereof, only.

     20
<Page>

EXHIBITS

A.   Legal Description of 1400-1450 E. American Lane, Schaumburg, Illinois

B.   Lease

<Page>

                                    EXHIBIT A

      LEGAL DESCRIPTION OF 1400-1450 E. AMERICAN LANE, SCHAUMBURG, ILLINOIS

LOTS 1 AND 2 IN PLAZA TOWERS SUBDIVISION, BEING A SUBDIVISION OF LOT 6 IN
ANDERSON'S WOODFIELD PARK, A SUBDIVISION OF PART OF THE NORTHWEST 1/4 OF SECTION
13, TOWNSHIP 41 NORTH, RANGE 10 EAST OF THE THIRD PRINCIPAL, MERIDIAN, EXCEPTING
THEREFROM THAT PART OF LOT 2 AFORESAID CONVEYED TO THE VILLAGE OF SCHAUMBURG BY
WARRANTY DEED DATED JUNE 28, 2002 AND RECORDED JULY 25, 2002 AS DOCUMENT NUMBER
0020314884 DESCRIBED AS FOLLOWS: BEGINNING AT THE NORTHWEST CORNER OF LOT 2
AFORESAID; THENCE ON AN ASSUMED BEARING OF SOUTH 89 DEGREES 34 MINUTES 01
SECONDS EAST ALONG THE NORTH LINE OF LOT 2 AFORESAID, 35.00 FEET; THENCE SOUTH
35 DEGREES 25 MINUTES 31 SECONDS WEST, 61.03 FEET TO THE WEST LINE OF LOT 2
AFORESAID; THENCE NORTH 00 DEGREES 25 MINUTES 59 SECONDS EAST, 50.00 FEET TO THE
POINT OF BEGINNING, IN COOK COUNTY, ILLINOIS

<Page>

                                    EXHIBIT B

                                 LEASE AGREEMENT

                        Dated as of _______________, 2004

                                     between

                                [Inland Entity],
                                    as Lessor

                                       and

                       Zurich American Insurance Company,
                                    as Lessee

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

                                    PROPERTY:

                                  ZURICH TOWERS

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

<Page>

                                TABLE OF CONTENTS

<Table>
<Caption>
                                                                                               PAGE
                                                                                               ----
<S>                                                                                              <C>
ARTICLE 1  DEFINITIONS ...........................................................................1
           Section 1.1.   DEFINITIONS ............................................................1

ARTICLE 2  LEASE OF PROPERTY .....................................................................1
           Section 2.1.   DEMISE AND LEASE .......................................................1

ARTICLE 3  RENT ..................................................................................2
           Section 3.1.   BASE RENT ..............................................................2
           Section 3.2.   SUPPLEMENTAL RENT ......................................................2
           Section 3.3.   METHOD OF PAYMENT ......................................................2
           Section 3.4.   LATE PAYMENT ...........................................................2
           Section 3.5.   NET LEASE, NO SETOFF, ETC ..............................................2
           Section 3.6.   TRUE LEASE .............................................................4

ARTICLE 4  RIGHT OF FIRST REFUSAL ................................................................4
           Section 4.1.   RIGHT OF REFUSAL .......................................................4
           Section 4.2.   NON-APPLICABILITY OF SECTION 4.1 .......................................5
           Section 4.3.   MISCELLANEOUS ..........................................................5

ARTICLE 5  RENEWAL OPTIONS .......................................................................5
           Section 5.1.   RENEWAL OPTIONS ........................................................5
           Section 5.2.   LEASE PROVISIONS APPLICABLE DURING RENEWAL..............................7

ARTICLE 6  LESSEE'S ACCEPTANCE OF PROPERTY, ENFORCEMENT
           OF WARRANTIES .........................................................................7
           Section 6.1.   WAIVERS ................................................................7
           Section 6.2.   LESSEE'S RIGHT TO ENFORCE WARRANTIES ...................................7

ARTICLE 7  LIENS .................................................................................8
           Section 7.1.   LIENS ..................................................................8

ARTICLE 8  USE AND REPAIR ........................................................................9
           Section 8.1.   USE ....................................................................9
           Section 8.2.   MAINTENANCE ............................................................9
           Section 8.3.   ALTERATIONS ............................................................9
           Section 8.4.   TITLE TO ALTERATIONS ..................................................11
           Section 8.5.   COMPLIANCE WITH LAW; ENVIRONMENTAL COMPLIANCE .........................12
           Section 8.6.   PAYMENT OF IMPOSITIONS ................................................13
           Section 8.7.   ADJUSTMENT OF IMPOSITIONS..............................................14
           Section 8.8.   UTILITY CHARGES .......................................................14
           Section 8.9.   LITIGATION; ZONING; JOINT ASSESSMENT ..................................14

ARTICLE 9  INSURANCE ............................................................................14
           Section 9.1.   COVERAGE ..............................................................14

ARTICLE 10 RETURN OF PROPERTY TO LESSOR .........................................................16
           Section 10.1.  RETURN OF PROPERTY TO LESSOR ..........................................16
</Table>

                                      - i -
<Page>

                                Table of Contents
                                    (Cont'd)

<Table>
<S>                                                                                              <C>
ARTICLE 11 ASSIGNMENT BY LESSEE .................................................................17
           Section 11.1.  ASSIGNMENT BY LESSEE ..................................................17

ARTICLE 12 LOSS; DESTRUCTION; CONDEMNATION OR DAMAGE ............................................18
           Section 12.1.  EVENT OF LOSS .........................................................18
           Section 12.2.  APPLICATION OF PAYMENTS UPON AN EVENT OF LOSS
                          WHEN LEASE CONTINUES ..................................................19
           Section 12.3.  APPLICATION OF PAYMENTS NOT RELATING TO AN EVENT OF
                          LOSS ..................................................................20
           Section 12.4.  OTHER DISPOSITIONS ....................................................20
           Section 12.5.  NEGOTIATIONS ..........................................................21

ARTICLE 13 INTENTIONALLY OMITTED ................................................................22

ARTICLE 14 SUBLEASE .............................................................................22
           Section 14.1.  SUBLEASING PERMITTED; LESSEE REMAINS OBLIGATED ........................22
           Section 14.2.  PROVISIONS OF SUBLEASES ...............................................22
           Section 14.3.  ASSIGNMENT OF SUBLEASE RENTS ..........................................23

ARTICLE 15 INSPECTION ...........................................................................23
           Section 15.1.  INSPECTION ............................................................23

ARTICLE 16 LEASE EVENTS OF DEFAULT ..............................................................24
           Section 16.1.  LEASE EVENTS OF DEFAULT ...............................................24

ARTICLE 17 ENFORCEMENT ..........................................................................25
           Section 17.1.  REMEDIES ..............................................................25
           Section 17.2.  SURVIVAL OF LESSEE'S OBLIGATIONS ......................................27
           Section 17.3.  REMEDIES CUMULATIVE; NO WAIVER; CONSENTS;
                          MITIGATION OF DAMAGES .................................................27
ARTICLE 18 RIGHT TO PERFORM FOR LESSEE ..........................................................28
           Section 18.1.  RIGHT TO PERFORM FOR LESSEE ...........................................28

ARTICLE 19 INDEMNITIES ..........................................................................28
           Section 19.1.  GENERAL INDEMNIFICATION ...............................................28

ARTICLE 20 LESSEE REPRESENTATIONS AND COVENANTS .................................................31
           Section 20.1.  REPRESENTATIONS AND WARRANTIES ........................................31

ARTICLE 21 [Intentionally Omitted] ..............................................................32

ARTICLE 22 PURCHASE PROCEDURE ...................................................................32
           Section 22.1.  PURCHASE PROCEDURE ....................................................32

ARTICLE 23 TRANSFER OF LESSOR'S INTEREST ........................................................33
           Section 23.1.  PERMITTED TRANSFER ....................................................33
           Section 23.2.  EFFECTS OF TRANSFER ...................................................34

ARTICLE 24 PERMITTED FINANCING ..................................................................34
           Section 24.1.  FINANCING DURING TERM .................................................34
</Table>

                                     - ii -
<Page>

                                Table of Contents
                                    (Cont'd)

<Table>
<S>                                                                                              <C>
           Section 24.2.  LESSEE'S CONSENT TO ASSIGNMENT FOR INDEBTEDNESS .......................34

ARTICLE 25 MISCELLANEOUS ........................................................................36
           Section 25.1.  BINDING EFFECT; SUCCESSORS AND ASSIGNS; SURVIVAL ......................36
           Section 25.2.  QUIET ENJOYMENT .......................................................36
           Section 25.3.  NOTICES ...............................................................36
           Section 25.4.  SEVERABILITY ..........................................................37
           Section 25.5.  AMENDMENTS, COMPLETE AGREEMENTS .......................................37
           Section 25.6.  HEADINGS ..............................................................37
           Section 25.7.  COUNTERPARTS ..........................................................37
           Section 25.8.  GOVERNING LAW .........................................................37
           Section 25.9.  MEMORANDUM ............................................................38
           Section 25.10. ESTOPPEL CERTIFICATES .................................................38
           Section 25.11. EASEMENTS .............................................................38
           Section 25.12. NO JOINT VENTURE ......................................................39
           Section 25.13. NO ACCORD AND SATISFACTION ............................................39
           Section 25.14. NO MERGER .............................................................39
           Section 25.15. LESSOR BANKRUPTCY .....................................................39
           Section 25.16. NAMING AND SIGNAGE OF THE PROPERTY ....................................39
           Section 25.17. EXPENSES ..............................................................39
           Section 25.18. INVESTMENTS ...........................................................40
           Section 25.19. FURTHER ASSURANCES ....................................................40
           Section 25.20. [Intentionally omitted] ...............................................40
           Section 25.21. INDEPENDENT COVENANTS .................................................40
           Section 25.22. LESSOR EXCULPATION ....................................................40
           Section 25.23. REMEDIES CUMULATIVE ...................................................40
           Section 25.24. HOLDING OVER ..........................................................41
           Section 25.25. SURVIVAL ..............................................................41
           Section 25.26. [Intentionally Omitted] ...............................................41
           Section 25.27. LEASE SUBORDINATE .....................................................41
           Section 25.28. LESSOR REPRESENTATION .................................................42
</Table>

                                     - iii -
<Page>

                                Table of Contents
                                    (Cont'd)

<Table>
           <S>                <C>
           Schedule 3.1   --  Base Rent
           Schedule 9.1   --  Insurance
           Schedule 12.2  --  Condemnation Allocation
           Exhibit A      --  Description of Land
           Exhibit B      --  Form of Estoppel Agreement
</Table>

                                     - iv -
<Page>

     THIS LEASE AGREEMENT (this "AGREEMENT") is made and entered into as of
_______________, 2004, by and between ______________________, as Lessor
("LESSOR"), having its principal place of business at _________________________,
and Zurich American Insurance Company, a New York corporation ("LESSEE"), having
a place of business at 1400 E. American Lane, Schaumburg, Illinois 60196.

                                    RECITALS

     A.   Lessee's affiliate was the owner of the Property, which is now owned
by Lessor;

     B.   Lessor desires to let and lease to Lessee, and Lessee desires to hire
and take from Lessor, the Property;

     C.   Lessor desires to grant and delegate to Lessee, and Lessee desires to
accept and assume from Lessor, certain rights and duties as described in this
Agreement;

                                      TERMS

     NOW THEREFORE, in consideration of the mutual agreements herein contained
and other good and valuable consideration, the receipt of which is hereby
acknowledged, the parties hereto, intending to be legally bound, hereby agree as
follows:

                                    ARTICLE 1
                                   DEFINITIONS

     Section 1.1. DEFINITIONS. The capitalized terms used herein and not
otherwise defined shall have the meanings assigned thereto in Appendix A hereto
for all purposes hereof.

                                    ARTICLE 2
                                LEASE OF PROPERTY

     Section 2.1. DEMISE AND LEASE. (a) Lessor hereby demises and leases the
Property to Lessee, and Lessee does hereby rent and lease the Property from
Lessor, for the Base Term and, subject to the exercise by Lessee of its renewal
options as provided in Article 5 hereof, for the Renewal Terms.

     (b)  Lessee may from time to time own or hold under lease or license from
Persons other than Lessor furniture, equipment and personal property, including
Lessee's Equipment and Personalty, located on or about the Property, which shall
not be subject to this Lease. Lessor shall from time to time, upon the
reasonable request of Lessee, promptly acknowledge in writing to Lessee or other
Persons that Lessor does not own or, except as provided in Article 10, have any
other right or interest in or to such furniture, equipment and personal
property, including Lessee's Equipment and Personalty, whether now owned or
hereafter acquired, and Lessor hereby waives any such right, title or interest.

<Page>

                                    ARTICLE 3
                                      RENT

     Section 3.1. BASE RENT. Lessee shall pay to Lessor Base Rent on each Rent
Payment Date during the Base Term in the amount set forth on Schedule 3.1
attached hereto and incorporated herein, and shall pay to Lessor Base Rent on
each Rent Payment Date during any Renewal Term as prescribed by Article 5. Each
installment of Base Rent is payable monthly in advance.

     Section 3.2. SUPPLEMENTAL RENT. Lessee shall pay to Lessor, or to such
other Person as shall be entitled thereto in the manner contemplated herein or
as otherwise required by Lessor, any and all Supplemental Rent as the same shall
become due and payable. In the event of Lessee's failure to pay when due and
payable any Supplemental Rent, Lessor shall have all rights, powers and remedies
provided for herein.

     Section 3.3. METHOD OF PAYMENT. All Base Rent and Supplemental Rent (other
than Excepted Payments) payable to Lessor shall, be paid to Lessor, or if Lessor
directs (on at least ten (10) Business Days prior notice), to Lessor's Lender in
each case to the Rent Collection Account, as directed by Lessor or Lender as
applicable, in immediately available funds as of the relevant payment date to
the Rent Collection Account, or such other account or accounts in the
continental United States as the Lender may from time to time designate (on at
least ten (10) Business Days' prior written notice) to Lessee. Upon payment in
full of all amounts due to the Lender, as reasonably evidenced to Lessee, which
evidence must include a written statement to that effect from the Lender, or
evidence of release or assignment of the Lien of the Mortgage, or other similar
evidence, Lessee shall accept instructions from Lessor (or its new lender, if so
instructed by Lessor) as to the payment of Base Rent and Supplemental Rent. Each
such payment of Rent shall be made by Lessee by wire or other transfer of funds
consisting of lawful currency of the United States of America which shall be
immediately available no later than 3:00 PM (New York City time) at the place of
receipt on the scheduled date when such payment shall be due, unless such
scheduled date shall not be a Business Day, in which case such payment shall be
made at such time on the immediately following Business Day, with the same force
and effect as though made on such scheduled dates. If any payment of Base Rent
or Supplemental Rent is received after 3:00 PM (New York City time) on the dates
when such rent is due, such rent shall be deemed received on the next succeeding
Business Day.

     Section 3.4. LATE PAYMENT. If any payment of Base Rent or any Supplemental
Rent payable to Lessor shall be delinquent, Lessee shall pay interest thereon
from the date such payment became due and payable to the date of receipt thereof
by Lessor at a rate per annum equal to the Default Rate.

     Section 3.5. NET LEASE, NO SETOFF, ETC. It is the intention of the parties
hereto that the obligations of Lessee hereunder shall be separate and
independent covenants and agreements, and that Base Rent, Supplemental Rent and
all other sums payable by Lessee hereunder shall continue to be payable in all
events, and that the obligations of Lessee hereunder shall continue unaffected,
unless the requirement to pay or perform the same shall have been terminated
pursuant to an express provision of this Lease. This Lease is a net lease and it
is agreed and intended that Base Rent, Supplemental Rent and any other amounts
payable hereunder by Lessee

                                      - 2 -
<Page>

shall be paid without notice (except with respect to Supplemental Rent for which
notice is specifically required herein), demand, counterclaim, setoff, deduction
or defense and without abatement, diminution or reduction and that Lessee's
obligation to pay all such amounts, throughout the Base Term and all applicable
Renewal Terms is absolute and unconditional. Under no circumstances shall Lessor
be obligated to repay Lessee, refund to Lessee, or return to Lessee, any Base
Rent.

Lessee acknowledges that it accepts full risk of its being unable to occupy the
Property, by virtue of Event of Loss, or Lease Event of Default, or by any other
reason, despite having paid Base Rent for such period. This Lease shall not
terminate and Lessee shall not have any rights to terminate this Lease, during
the Base Term and any Renewal Terms (except as otherwise expressly provided in
Section 12.1), Except to the extent otherwise expressly specified in Section
12.1, Lessee shall not take any action to terminate, rescind or void this Lease
and the obligations and liabilities of Lessee hereunder shall in no way be
released, discharged or otherwise affected for any reason, including without
limitation: (a) any defect in the condition, merchantability, design, quality or
fitness for use of the Property or any part thereof, or the failure of the
Property to comply with all Applicable Laws, including any inability to occupy
or use the Property by reason of such noncompliance; (b) any damage to, removal,
abandonment, salvage, loss, condemnation (except as set forth in Section 12.2
and 12.3 below), theft, scrapping or destruction of or any requisition or taking
of the Property or any part thereof, or any environmental conditions on the
Property or any property in the vicinity of the Property; (c) any restriction,
prevention or curtailment of or interference with any use of the Property or any
part thereof including eviction; (d) any defect in title to or rights to the
Property or any Lien on such title or rights to the Property; (e) any change,
waiver, extension, indulgence or other action or omission or breach in respect
of any obligation or liability of or by any Person; (f) any bankruptcy,
insolvency, reorganization, composition, adjustment, dissolution, liquidation or
other like proceedings relating to Lessee, Lessor or any other Person, or any
action taken with respect to this Lease by any trustee or receiver of Lessee or
any other Person, or by any court, in any such proceeding; (g) any right or
claim that Lessee has or might have against any Person, including without
limitation Lessor, the Lender, or any vendor, manufacturer, contractor of or for
the Property; (h) any failure on the part of Lessor or any other Person to
perform or comply with any of the terms of this Lease; (i) any invalidity,
unenforceability, rejection or disaffirmance of this Lease by operation of law
or otherwise against or by Lessee or Lessor or any provision hereof; (j) the
impossibility of performance by Lessee or Lessor, or both; (k) any action by any
court, administrative agency or other Governmental Authority; (l) any
interference, interruption or cessation in the use, possession or quiet
enjoyment of the Property; (m) the exercise of any remedy, including
foreclosure, under the Mortgage, (n) any action with respect to this Lease
(including the disaffirmance or rejection hereof) which may be taken by Lessor
or Lessee under the Federal Bankruptcy Code or by any trustee, receiver or
liquidator of Lessor or Lessee or by any court under the Federal Bankruptcy Code
or otherwise, (o) the prohibition or restriction of Lessee's use of the Property
under any Applicable Laws or otherwise, (p) the eviction of Lessee from
possession of the Property, by paramount title or otherwise, (q) any breach or
default by Lessor hereunder or under any other agreement between Lessor and
Lessee; or (r) any other occurrence whatsoever, whether similar or dissimilar to
the foregoing, whether foreseeable or unforeseeable, and whether or not Lessee
shall have notice or knowledge of any of the foregoing. Except as specifically
set forth in this Lease, this Lease shall be noncancellable by Lessee for any
reason whatsoever and, except as expressly provided in this Lease, Lessee, to
the extent now

                                      - 3 -
<Page>

or hereafter permitted by Applicable Laws, waives all rights now or hereafter
conferred by statute or otherwise to quit, terminate or surrender this Lease or
to any diminution, abatement or reduction of Rent payable hereunder, Under no
circumstances or conditions shall Lessor be expected or required to make any
payment of any kind hereunder or have any obligations with respect to the use,
possession, control, maintenance, alteration, rebuilding, replacing, repair,
restoration or operation of all or any part of the Property, so long as the
Property or any part thereof is subject to this Lease, and Lessee expressly
waives the right to perform any such action at the expense of Lessor whether
hereunder or pursuant to any law. Lessee waives all rights which are not
expressly stated herein but which may now or hereafter otherwise be conferred by
law (i) to quit, terminate or surrender this Lease or any of the Property; (ii)
to have any setoff, counterclaim, recoupment, abatement, suspension, deferment,
diminution, deduction, reduction or defense of or to Base Rent, Supplemental
Rent, or any other sums payable under this Lease, except as otherwise expressly
provided herein; and (iii) to have any statutory lien or offset right against
Lessor or its property.

     Section 3.6. TRUE LEASE. It is the intent of Lessor and Lessee and the
parties agreed that the Lease is a true lease and that the Lease does not
represent a financing agreement. Each party shall reflect the transaction
represented hereby in all applicable books, records and report (including
income tax filings) in a manner consistent with "true lease" treatment rather
than "financing" treatment.

                                    ARTICLE 4
                             RIGHT OF FIRST REFUSAL

     Section 4.1. RIGHT OF REFUSAL. (a) Provided that no Lease Event of Default
has occurred and is continuing, Lessee shall have a right of first refusal as
described in this Article 4 with respect to (i) any sale of the Property, or
(ii) any sale or sales that would in the aggregate result in Inland Western
Retail Real Estate Trust, Inc. or its Affiliates ceasing to own, directly or
indirectly, at least a majority interest in Lessor and in the profits and losses
of Lessor. If Lessor or any party that owns an interest, directly or indirectly,
in Lessor (the "OFFEROR"), receives an offer for sale the Property or any of the
above described interests from any party (other than an Affiliate of such
Offeror), which offer the Offeror wishes to accept or has accepted subject to
Lessee's rights in this Article 4, the Offeror shall deliver to Lessee a notice
(constituting an offer) stating the sales price and all other material terms for
the sale of the Property or interest that the Lessor would accept (which notice
may be an executed purchase and sale agreement with a prospective purchaser
(which must be subject to the terms of this Article 4)) (the "FIRST REFUSAL
NOTICE"). Lessee shall have thirty (30) days from its receipt of the First
Refusal Notice to accept the offer set forth in the First Refusal Notice (the
"TERMS"). For purposes hereof, the ninety day period is referred to as the
"Applicable Period". A First Refusal Notice may be accepted by Lessee or its
designee. The Offeror shall not be permitted to revoke the First Refusal Notice
during the Applicable Period, but the Applicable Period shall be deemed to be
revoked during the Applicable Period if Offeror and Lessee or its designee enter
into a purchase agreement on terms different than the Terms. The Terms may be
rejected by Lessee at any time.

     If Lessee desires to accept the Terms for the Property or the offered
interests, Lessee must accept the Terms within the Applicable Period and must
enter into a purchase agreement with the Offeror for the purchase and sale of
the Property or offered interests on substantially the

                                      - 4 -
<Page>

same form as executed between Offeror and the prospective purchaser, but without
any inspection period, by the later of (x) the expiration of the Applicable
Period or (y) thirty (30) days after Lessee has irrevocably accepted the Terms.
The purchase agreement for the sale of the Property or offered interest shall
provide for a closing on the terms set forth in the Terms. Lessor (on behalf of
the Offeror) and Lessee agree to negotiate any purchase agreement in good
faith, subject to Section 4.3, below. Lessee shall not have the right to accept
the Terms during the continuance of any Lease Event of Default.

     (b)  If Lessee (or its designee) rejects the Terms, the Offeror shall
either (i) execute a purchase agreement on the Terms, and close (absent a
default by the buyer) or (ii) if the Terms were contained in an executed
agreement with a buyer, close on the Terms therein (absent a default by buyer),
in each case within 120 days from (y) the expiration of the Applicable Period,
or (z) the date Lessee rejects the Terms, whichever is earlier. If the closing
does not occur within such period Offeror shall be required to repeat the
procedure set forth in Section 4.1 (a) if it still wishes to sell the Property
or offered interests.

     Section 4.2. NON-APPLICABILITY OF SECTION 4.1 (a) Section 4.1 shall not
apply to a conveyance or assignment to an Affiliate of the Lessor or to Lender,
or an Affiliate of or successor to Lender, or the purchaser at a foreclosure
sale in connection with the foreclosure, or to Lender, or any Affiliate or
designee, in connection with a deed in lieu of foreclosure of the Mortgage.
Lessee's rights hereunder shall survive any sale or transfer described above.

     (b)  Any purchase of the Property under this Article 4 will be subject to
the Lease and the Mortgage, unless the indebtedness secured by the Mortgage is
repaid in full. If Lessee or its Affiliate is the purchaser of the Property
there shall be no merger of the fee and the leasehold.

     Section 4.3. MISCELLANEOUS. (a) Lessee's failure to elect to purchase the
Property shall not constitute a waiver on the part of Lessee of all of its
rights under this Article 4 with respect to any other sale, assignment,
transfer, conveyance or other disposition; provided, however, that a transfer of
the Property pursuant to a deed in lieu of foreclosure or by foreclosure shall
result in all of Lessee's rights under this Article 4 being extinguished.

     (b)  The First Refusal Notice and the Terms may cover only the Property and
not any other property owned by Lessor or an affiliate of Lessor.

     (c)  The Right of First Refusal Notice and the Terms must cover the entire
Property. Lessor may not sell, or offer to sell, or transfer or offer to
transfer any interest, the result of which would be a sale or transfer of less
than the entirety of the Property.

                                    ARTICLE 5
                                 RENEWAL OPTIONS

     Section 5.1. RENEWAL OPTIONS. (a) Lessor hereby grants to Lessee the option
to extend the term of this Lease for the following periods (each, a "RENEWAL
TERM"):

          (i)     for two consecutive terms of five (5) years each, the first
     commencing on the date that is the day after the expiration of the Base
     Term and ending on the fifth (5th) anniversary of the expiration of the
     Base Term (the "FIRST RENEWAL TERM"); and the

                                      - 5 -
<Page>

     second (the "SECOND RENEWAL TERM") commencing on the day that is the day
     after the expiration of the First Renewal Term and ending on the fifth
     (5th) anniversary thereof (collectively, the "FIXED RATE RENEWAL TERMS");
     and

          (ii)    for three (3) successive terms of five (5) years each (each,
     an "ADDITIONAL RENEWAL TERM"), with each such Additional Renewal Term
     commencing on the date that is the day after the expiration of the
     preceding Renewal Term.

     (b)  In order to exercise its option to extend this Lease for any Renewal
Term, the following procedure shall be followed:

          (i)     Lessee shall give Lessor written notice of its intent to
     exercise its option to extend the term of this Lease not less than thirteen
     (13) months prior to the expiration of the Base Term or the First Renewal
     Term, as applicable, with respect to the Fixed Rate Renewal Terms, and not
     less than sixteen months (16) prior to the expiration of the then current
     Renewal Term, as the case may be, for any Additional Renewal Terms, (each,
     an "INTENT TO RENEW DATE"), time being of the essence. If Lessee fails to
     provide such notice for any Additional Renewal Terms, Lessee will be deemed
     to have exercised its right to renew, subject to the terms set forth below.
     If Lessee fails to provide such notice for any Fixed Rate Renewal Term
     Lessee will be deemed to have waived its right to renew.

          (ii)    The monthly Base Rent for the First Renewal Term and the
     Second Renewal Term shall be as set forth on Schedule 3.1 hereof.

          (iii)   The monthly Base Rent payable for each Additional Renewal Term
     shall be equal to 95% of the Fair Market Rental Value, anticipated to be in
     effect as of the commencement date of the applicable Renewal Term. Upon
     receipt of Lessee's notice to renew, or deemed election (for any Additional
     Renewal Terms), Lessor and Lessee shall promptly commence good faith
     negotiations to agree upon the Fair Market Rental Value, but no earlier
     than 16 months prior to commencement of the applicable Renewal Term. If the
     parties cannot agree on the Fair Market Rental Value within thirty (30)
     days after Lessor has received Lessee's notice to renew, the Fair Market
     Rental Value shall be determined by the Appraisal Procedure. Whether Lessee
     has exercised its right to renew the Term, or has been deemed to do so,
     Lessor and Lessee shall in good faith commence negotiations as to the Fair
     Market Rental Value and, if necessary conclude the Appraisal Procedure, by
     the date which is 13 months prior to the expiration of the then current
     Term. By the date which is 13 months prior to the expiration date of the
     then current Term, but not prior to the date the Base Rent for the
     applicable Renewal Term is fixed, Lessee must irrevocably exercise its
     right to extend the Lease Term. If Lessee fails to do so it will be deemed
     to waive its right to renew, and the Lease Term shall expire at the
     expiration of the then current Renewal Term.

     (c)  The right of Lessee to extend the term of this Lease for any Renewal
Term is contingent upon there not being any Lease Event of Default in existence
on the date of Lessee's exercise of such right or on the date that the Renewal
Term commences.

                                      - 6 -
<Page>

     Section 5.2. LEASE PROVISIONS APPLICABLE DURING RENEWAL. All the provisions
of this Lease shall be applicable during each Renewal Term and the number of
Renewal Terms shall be correspondingly reduced.

                                    ARTICLE 6
           LESSEE'S ACCEPTANCE OF PROPERTY, ENFORCEMENT OF WARRANTIES

     Section 6.1. WAIVERS. The Property is demised and let by Lessor "AS IS" in
its present condition, subject to (a) the rights of any parties in possession
thereof (other than rights, if any, granted by Lessor), (b) the state of the
title thereto existing at the time of the commencement of the Lease Term (other
than defects in, or exceptions to, title, if any, created by Lessor, but
including liens created by the Mortgage and related debt documents), (c) any
state of facts which an accurate survey or physical inspection might show, (d)
all Applicable Laws, (e) any violations of Applicable Laws which may exist at
the commencement of the Lease Term and (f) the presence of any Hazardous
Materials at or under the Property or at or under any property in the vicinity
of the Property. NONE OF LESSOR, LENDER OR ANY AFFILIATE THEREOF HAS MADE OR
SHALL BE DEEMED TO HAVE MADE ANY REPRESENTATION OR WARRANTY, EXPRESS OR IMPLIED,
OR SHALL BE DEEMED TO HAVE ANY LIABILITY WHATSOEVER AS TO THE VALUE,
HABITABILITY, COMPLIANCE WITH ANY PLANS AND SPECIFICATIONS, CONDITION, DESIGN,
OPERATION, LOCATION, USE, DURABILITY, MERCHANTABILITY, CONDITION OF TITLE, OR
FITNESS FOR USE OF THE PROPERTY (OR ANY PART THEREOF) FOR ANY PARTICULAR
PURPOSE, OR ANY OTHER REPRESENTATION OR WARRANTY WHATSOEVER, EXPRESS OR IMPLIED,
WITH RESPECT TO THE PROPERTY (OR ANY PART THEREOF) AND NONE OF LESSOR, ANY
AFFILIATE THEREOF OR LENDER OR ANY DESIGNEE THEREOF SHALL BE LIABLE FOR ANY
LATENT, HIDDEN, OR PATENT DEFECT THEREIN OR FOR THE FAILURE OF THE PROPERTY TO
BE CONSTRUCTED IN ACCORDANCE WITH ANY PLANS AND SPECIFICATIONS THEREFOR, FOR THE
COMPLIANCE OF THE PLANS AND SPECIFICATIONS FOR THE PROPERTY WITH APPLICABLE LAWS
OR FOR THE FAILURE OF THE PROPERTY, OR ANY PART THEREOF, TO OTHERWISE COMPLY
WITH ANY APPLICABLE LAWS. It is agreed that Lessee or an Affiliate of Lessee has
occupied the Property as tenant or owner immediately prior to entering into this
Lease, has inspected the Property, is satisfied with the results of its
inspections of the Property and is entering into this Lease solely on the basis
of the results of its own inspections and all risks incident to the matters
discussed in the preceding sentence. The provisions of this Article 6 have been
negotiated, and the foregoing provisions are intended to be a complete exclusion
and negation of any representations or warranties by Lessor, any Affiliate
thereof or a Lender, express or implied, with respect to the Property, that may
arise pursuant to any law now or hereafter in effect, or otherwise and
specifically negating any warranties under the Uniform Commercial Code.

     Section 6.2. LESSEE'S RIGHT TO ENFORCE WARRANTIES. (a) Subject to Section
6.2(b) below, Lessor hereby assigns and sets over to, and Lessee hereby accepts
the assignment of all of Lessor's right, title and interest, and estate in, to
and under, any and all warranties and other claims against dealers,
manufacturers, vendors, contractors and subcontractors relating to the
construction, use and maintenance of the Property or any portion thereof now
existing or hereafter acquired (excluding from such assignment any such
warranties and claims which by

                                      - 7 -
<Page>

their terms are not assignable by Lessor without loss of some or all of the
benefits of such warranties or claims); PROVIDED, HOWEVER, that Lessor shall
have no obligations under, or liabilities with respect to, any such warranties
and claims.

     (b)  Lessor authorizes Lessee (directly or through agents) at Lessee's
expense to assert during the Lease Term, all of Lessor's rights (if any) under
any applicable warranty and any other claim that Lessee or Lessor may have
against any dealer, vendor, manufacturer, contractor or subcontractor with
respect to the Property or any portion thereof.

     (c)  Lessor agrees, at Lessee's expense, to cooperate with Lessee and take
all other action necessary as specifically requested by Lessee to enable Lessee
to enforce all of Lessee's rights (if any) under this Section 6.2, such rights
of enforcement to be exclusive to Lessee, and Lessor will not, during the Lease
Term, amend, modify or waive, or take any action under, any applicable warranty
and any other claim that Lessee may have under this Section 6.2 without Lessee's
prior written consent.

                                    ARTICLE 7
                                      LIENS

     Section 7.1. LIENS. Lessee shall not directly or indirectly create, incur,
assume or suffer to exist any Lien on or with respect to any and all of the
Property, title thereto or any interest therein, to this Lease or the leasehold
interest created hereby, or to Rent, title thereto or interest therein, or the
rentals payable with respect to the subletting of the Property, except Permitted
Liens. Lessee shall promptly, but not later than sixty (60) days after receipt
of notice of the filing thereof, at its own expense, take such action as may be
necessary duly to discharge or eliminate or bond in a manner reasonably
satisfactory to Lessor any such Lien (other than Permitted Liens); provided,
however, Lessee may contest such Lien in good faith, upon satisfaction of the
conditions contained in Section 8.6, below, and need not discharge or bond such
Lien while so doing provided (i) Lessee has a long term unsecured debt rating
equal to or above the Trigger Rating; (ii) no action to foreclose the Lien has
been brought in any judicial or quasi-judicial action; and (iii) no Lease Event
of Default is then continuing.

     NOTHING CONTAINED IN THIS LEASE SHALL BE CONSTRUED AS CONSTITUTING THE
CONSENT OR REQUEST OF LESSOR, EXPRESS OR IMPLIED, TO OR FOR THE PERFORMANCE BY
ANY CONTRACTOR, LABORER, MATERIALMAN, OR VENDOR OF ANY LABOR OR SERVICES OR FOR
THE FURNISHING OF ANY MATERIALS FOR ANY CONSTRUCTION, ALTERATION, ADDITION,
REPAIR OR DEMOLITION OF OR TO THE PROPERTY OR ANY PART THEREOF, WHICH WOULD
RESULT IN ANY LIABILITY OF LESSOR FOR PAYMENT THEREFOR. NOTICE IS HEREBY GIVEN
THAT LESSOR WILL NOT BE LIABLE FOR ANY LABOR, SERVICES OR MATERIALS FURNISHED OR
TO BE FURNISHED TO LESSEE, OR TO ANYONE HOLDING AN INTEREST IN THE PROPERTY OR
ANY PART THEREOF THROUGH OR UNDER LESSEE, AND THAT NO MECHANICS OR OTHER LIENS
FOR ANY SUCH LABOR, SERVICES OR MATERIALS SHALL ATTACH TO OR AFFECT THE INTEREST
OF LESSOR IN AND TO THE PROPERTY.

                                      - 8 -
<Page>

     Notwithstanding the foregoing paragraph, Lessor agrees to reasonably
cooperate with Lessee (without exposing its interest in the Property), at no
cost to Lessor, to allow Lessee to perform alterations on the Property in
accordance with Section 8.3.

                                    ARTICLE 8
                                 USE AND REPAIR

     Section 8.1. USE. The Property may be used ("PERMITTED USE") for any lawful
purpose, except (a) for the operation of a public nuisance, or any other use
that would materially increase the risk of Lessor incurring environmental
liability, (b) for any use that would make it impossible to obtain or would
invalidate any insurance policy of the Property, provided such policy is
required to be maintained hereunder, (c) for any use that would involve the
mining for, or removal of, any oil, gas or minerals, or (d) for any use that
involves the storage, handling or processing of Hazardous Materials in violation
of Applicable Law. Lessor agrees that Lessee may exercise the rights of Lessor
under any property association now existing or hereafter existing, provided (i)
Lessee takes no action which could result in either a violation of this Lease or
an adverse effect on the Property, and (ii) Lessee does not encumber the
Property by any lien for the payment of money, which could survive expiration of
the Lease, or execute documents on behalf of the Lessor unless such documents
will not have a material adverse effect on the Property, or Lessor's interest
therein.

     Section 8.2. MAINTENANCE. Lessee, at its own expense, shall at all times,
(i) maintain the Property in good condition and repair appropriate for its use,
reasonable wear and tear excepted, (ii) maintain the Property in accordance with
the requirements of all insurance policies relating to the Property required to
be maintained hereunder and in compliance with Applicable Laws and (iii) make
repairs and Alterations of the Property necessary to keep the same in the
condition required by the preceding clauses (i) and (ii), whether interior or
exterior, structural or nonstructural, ordinary or extraordinary, foreseen or
unforeseen and regardless of whether such expenditures would constitute capital
expenses under GAAP if made by the owner of the Property; provided, if such
repairs are structural and pursuant to Section 8.3 require the consent of the
Lessor, Lessee shall obtain such consent before performing such repairs in
accordance with the applicable provisions of Section 8.3 below. In no event
shall Lessor be entitled to any management fee, supervisory fee, administrative
fee, or any other fee relating to its ownership of the Property.

     Section 8.3. ALTERATIONS. (a) At any time and from time to time, Lessee, at
its sole cost and expense, may make (1) non-structural Alterations to the
Property; (2) structural Alterations to the Property costing, for each scope of
work, as reasonably determined by Lessee, less than the Threshold Amount with
prior notice to Lessor and Lender; and (3) Structural Alterations in an amount,
for each scope of work, as reasonably determined by Lessee, at or above the
Threshold Amount after giving prior written notice to Lessor and the Lender, and
obtaining Lessor's and the Lender's prior written consent, which shall not be
unreasonably withheld, conditioned or delayed; PROVIDED that no Alteration
(whether consent is necessary or not) shall (i) impair in any material respect
the utility, remaining useful life, or fair market value of the Property, in
each case assuming that the Improvements are then being operated and maintained
in accordance with this Article 8, or (ii) create a violation of this Lease, or
(iii) increase in any material respect the risk of liability to the Lessor
including any material risk of liability under

                                      - 9 -
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any Environmental Laws, or (iv) materially and permanently reduce the rentable
square footage (as calculated in accordance with the methods of measuring
rentable area as described in the Standard Method for Measuring Floor Area in
Office Buildings, ANSI 765.1-1996, as promulgated by the Building Owners and
Managers Association International) of the Improvements, or (v) materially
weaken, temporarily (other than during construction or repair of the structure)
or permanently, the structure of the Improvements or any part thereof, or (vi)
reduce the permitted uses thereof under applicable zoning or land use laws so as
to reduce the fair market value of the Property. The Threshold Amount, and those
set forth below in Sections 8.3(b) and 8.4(c), shall be increased on every
annual anniversary date of the Closing Date in the same proportion that the CPI
increases over such annual period. Notwithstanding the requirements for notice
and consent set forth above, Lessee may, in good faith, make any repairs
(structural or non-structural) required by virtue of an emergency, without
satisfying any otherwise applicable notice and/or consent requirement, provided
Lessee notifies Lessor of such repair (to the extent otherwise required) as
promptly as is reasonably practical, after the emergency and obtains Lessor's
and the Lender's consent thereto (if required) in the manner required in Section
8.3(c), below, to the repairs made, and otherwise satisfies the provisions of
this Section 8.3, all as promptly as practicable. Lessor shall consent to any
work already performed or being performed unless such work either violates the
terms of this Lease or violates Applicable Law.

     (b)  Every Alteration shall comply with the following terms (which
compliance shall be at Lessee's sole cost and expense): (i) except (unless
required by Applicable Law) for Alterations costing less than $2,000,000 (or
$500,000.00 if Lessee does not have a Required Rating equal to at least the
Trigger Rating) for each scope of work, as reasonably determined by Lessee, the
Alteration shall be made with plans prepared by a certified architect or civil
engineer who shall be licensed in the appropriate jurisdiction to the extent
required for the filing of any plans in connection with such Alteration (which
architect may be an employee of Lessee or its Affiliates), and shall be done
under the supervision of such architect or engineer, or other reasonably capable
person, and copies of such plans and specifications shall be delivered to Lessor
and the Lender prior to construction, (ii) the structural integrity of the
existing Improvements will not be impaired upon completion of such work, (iii)
Lessee shall obtain any licenses, approvals or permits required (including final
approvals), copies of which shall be delivered to Lessor and the Lender upon
written request by such party, and (iv) such Alterations will not encroach upon
any adjacent premises. Lessor agrees to cooperate with Lessee (at no cost to
Lessor) in signing permit applications and similar documents to the extent
required for any Alteration. Lessee shall submit such applications or similar
documents to Lessor and to the Lender to the extent Lessor's and Lender's
approval are required for the subject Alteration. Lessee may execute such
applications or similar documents on behalf of and (if necessary) in the name
of, Lessor for all Alterations for which Lessor's consent is not required, and
for Alterations for which Lessor's and the Lender's consent is required, has
been granted, but Lessor does not execute such documents within 10 days of
request therefor. Lessee shall promptly furnish Lessor with copies of all
documents Lessee has signed on behalf of Lessor. Nothing herein shall be deemed
to impose any liability or responsibility on Lessor for performance or payment
of such Alteration. Any Claim asserted against or incurred by Lessor arising out
of the foregoing shall be indemnified by Lessee pursuant to the terms of Section
19.1, below. In connection with any Alteration, Lessee shall perform and
complete all work promptly and in a good, worker-like manner in compliance with
Applicable Laws and the plans and specifications submitted to

                                     - 10 -
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Lessor and Lender, if applicable. Lessee shall either (i) maintain or cause to
be maintained at all times during construction builder's all risks insurance and
comprehensive general liability insurance required under this Lease naming
Lessor and Lender as loss payees as their interests may appear under such
property insurance, and as additional insureds under such liability insurance or
(ii) self insure the risk otherwise insured by the policies required in
subsection (i) hereof, which self insurance shall be subject to, and available
only upon satisfaction of, the provisions of Section 9.l(b). In the event Lessor
and Lessee cannot agree as to whether Lessor unreasonably withheld its consent
to a proposed Alteration, the parties agree to submit such dispute to the
American Arbitration Association in Illinois for binding resolution in
accordance with its expedited arbitration procedures.

     (c)  With respect to such structural Alterations for which Lessee must
obtain the consent of Lessor and the Lender pursuant to the terms of this Lease,
Lessor and the Lender shall each have fifteen (15) days after Lessee's delivery
of its request for consent, together with preliminary drawings and
specifications for such Alterations, within which Lessor and the Lender, as the
case may be, may grant or not grant Lessee's request for consent. If Lessor or
the Lender, as the case may be, shall have not within such 15-day period
responded to Lessee, Lessee may give a second notice which clearly shall state
in bold-face type that the failure to respond within three (3) days shall be
deemed consent. If Lessor or the Lender, as the case may be, shall not, within
three (3) days after such second notice, notify Lessee that such consent will
not be granted, such consent shall be deemed to have been granted. All
reasonable out-of-pocket costs of review incurred by Lessor (whether or not the
Alteration is approved) shall be paid by Lessee within thirty (30) days of
receipt of an invoice therefore.

     (d)  Lessor agrees that its debt documents will require the Lender to be
bound by a provision substantially similar to that set forth in subsections (a),
(b) and (c), above.

     Section 8.4. TITLE TO ALTERATIONS. Title to Alterations shall without
further act vest in Lessor and shall be deemed to constitute a part of the
Property and be subject to this Lease in the following cases:

     (a)  such Alteration shall be in replacement of or in substitution for a
portion of the Improvements as of the date hereof,

     (b)  such Alteration shall be required to be made pursuant to the terms of
Section 8.2; or

     (c)  such Alteration shall be Nonseverable.

     If an Alteration is not within any of the categories set forth in Section
8.4(a) through Section 8.4(c), then title to such Alteration shall vest in
Lessee and shall be removed by Lessee to the extent required in accordance with
Article 10 hereof. All Alterations to which title shall vest in Lessee as
aforesaid, and all Lessee's Equipment and Personalty, so long as removal thereof
shall not result in the violation of any Applicable Laws or this Lease, may be
removed at any time by Lessee, PROVIDED that Lessee shall, at its expense,
repair any damage to the Property caused by the removal of such Alteration.
Lessee shall provide "AS-BUILT" plans to Lessor

                                     - 11 -
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and Lender for any structural Alterations within a single scope of work (as
reasonably determined by Lessee) costing in excess of $1,500,000,00.

     Section 8.5. COMPLIANCE WITH LAW; ENVIRONMENTAL COMPLIANCE. (a) Lessee, at
Lessee's expense, shall comply, and shall cause its subtenants and other users
of the Property to comply, in all material respects at all times with all
Applicable Laws, including Environmental Laws. Such compliance includes, without
limitation, Lessee's obligation, at its expense, to take Remedial Action when
required by Applicable Laws (in accordance with Applicable Laws, and this Lease)
whether such requirement is now or hereafter existing, currently known or
unknown to Lessee and/or Lessor, as and when such requirements are known to
Lessee. In the event that Lessee is required or elects to enter into any plan
relating to a Material Remedial Action in connection with the Property with
respect to any Environment Laws, Lessee shall periodically apprise Lessor and
the Lender of the status of such remediation plan and, upon Lessor or Lender's
request, provide copies of all correspondence, plans, proposals, contracts and
other documents relating to such plan or proposed plan. Lessee may in good faith
contest the applicability or alleged liability under any Environmental Law to
the Property, provided (i) such contest will not result in a lien, encumbrance
or judgment against the Property or Lessor, (ii) such contest satisfies the
conditions set forth in subsections 8.6(i), (ii), (iii), (iv), (v), (vi) and
(vii), below, (iii) Lessee then has a Required Rating equal to or better than
the Trigger Rating, and (iv) compliance with such Law will be satisfied as of
the expiration date or earlier termination of the Lease, and if not completed
by the expiration date, Lessee will continue to remain liable to comply with
such Law and shall diligently prosecute such plan, and Lessor shall provide
access to the Property to allow Lessee to finish its remediation plan. Lessee
shall keep Lessor regularly apprised of the status of such contest. In all
events Lessee must pay any cost, fine, penalty, assessment or other charge after
the contest is either adversely decided or terminated voluntarily by Lessee or
because it no longer has the right to contest pursuant to the terms of the
Lease. In the event Lessee does not have a Required Rating equal to or in excess
of the Trigger Rating, Lessee may nonetheless contest the applicability of any
Environmental Law provided that Lessee and Lessor agree upon an Approved
Environmental Consultant who shall, at Lessee's sole cost and expense, prepare a
report within sixty (60) days of being retained, which report shall state the
costs the Approved Environmental Consultant reasonably believes is likely to be
incurred by Lessee to comply with the Environmental Law in the event Lessee
loses its contest. If, within thirty (30) days of receipt of said report, Lessee
deposits with the Proceeds Trustee an amount equal to 110% of the cost estimated
by the Approved Environmental Consultant to comply with the Environmental Law,
Lessee may continue the contest, provided the other terms of this Section 8.5
are met. In the event Lessee loses the contest and is forced to incur costs to
comply with the Environmental Law, the Proceeds Trustee shall dispense the
amount retained by it pursuant to this paragraph from time to time, in
accordance with the provisions of Section 12.4 below, with any balance remaining
thereafter to be disbursed to Lessee provided no Lease Event of Default then
exists and is continuing. Lessor and Lessee shall reasonably cooperate in
selecting the Approved Environmental Consultant.

     (b)  Lessee shall notify Lessor and Lender promptly if (i) Lessee becomes
aware of the presence or Release of any Hazardous Material at, on, under,
emanating from, or migrating to, the Property in any quantity or manner, which
could reasonably be expected to violate in any material respect any
Environmental Law or give rise to any Material liability, or (ii) Lessee
receives any written notice, claim, demand, request for information, or other
communication

                                     - 12 -
<Page>

from a Governmental Authority or a third party regarding the presence or Release
of any Hazardous Material at, on, under, within, emanating from, or migrating to
the Property or related to the Property which could reasonably be expected to
violate in any material respect any Environmental Law or give rise to any
Material liability. In connection with any actions undertaken pursuant to this
Agreement, Lessee shall at all times comply with all applicable Environmental
Laws and with all other Applicable Laws and shall use an Approved Environmental
Consultant to perform any Remedial Action.

     Section 8.6. PAYMENT OF IMPOSITIONS. Lessee shall pay or cause to be paid
all Impositions before any fine, penalty, premium, further interest (except as
provided in the immediately succeeding sentence with respect to installments) or
cost may be assessed or added for nonpayment, such payments to be made directly
to the taxing authorities where feasible. If requested, Lessee shall deliver to
Lessor and the Lender copies of receipts, canceled checks or other documentation
reasonably satisfactory to Lessor and the Lender evidencing payment of
Impositions to the extent Lessee maintains such documentation as part of its
customary retention policy; PROVIDED, HOWEVER, that Lessee shall maintain in its
records evidence of payment of real estate taxes for a period of no less than
four (4) years. Lessee, at Lender's request and at Lessee's expense, shall also
retain a tax service contract with a company reasonably acceptable to Lessor and
Lender which shall provide notice to Lessor and Lender when Impositions are
paid, or if they are not paid, when due. If any such Imposition may, at the
option of the taxpayer, lawfully be paid in installments (regardless whether
interest shall accrue on the unpaid balance of such Imposition), Lessee may
exercise the option to pay the same in installments, and in such event Lessee
shall pay only those installments that become due and payable during the Lease
Term or relate to the Lease Term, as the same become due and before any fine,
penalty, premium, further interest or cost may be assessed or added thereto.
Notwithstanding the foregoing, Lessee shall have the right to contest any
Imposition, subject to the following: (i) such contest shall be at its sole cost
and expense, (ii) if the Imposition being contested is in the amount of
$2,000,000.00 or more (as such amount may be increased by increases in the CPI
in the manner contemplated in Section 8.3(a), above) Lessee shall provide prompt
notice to Lessor and Lender of such Imposition and contest and the grounds
thereof, and either (A) have a Required Rating equal to the Trigger Rating or
(B) deposit cash with the Proceeds Trustee in an amount equal to 110% of the
amount contested, as reasonably determined by the Lender, to the extent such
contested Imposition is not paid to the applicable Governmental Authority, (iii)
such contest shall be by appropriate legal proceedings conducted in good faith
and with due diligence, (iv) such contest will operate to suspend the collection
of, or other realization upon, such Imposition, from any Property or other
interest of Lessor or Lender, or from any Rent (or otherwise affect Lessee's
obligation to pay, and Lessor's right to receive, Rent), (v) such contest will
not adversely affect the Lender's lien on any Property, or Lessor's right to any
Property (for purposes hereof, "adversely affecting" being deemed to mean such
lien or Lessor's right is subject to reasonable likelihood of extinguishment),
(vi) such contest will not materially and adversely interfere with the
possession, use or occupancy or sale of any Property, (vii) such contest will
not subject Lessor or the Lender to any civil (other than for the amounts being
contested) or criminal liability, (viii) Lessee shall not postpone the payment
of any Imposition for such length of time as shall permit the Property to become
subject to a lien created by such item being contested that is prior to the lien
of the Mortgage (other than a lien of real property taxes which are already a
first lien) and (ix) no Lease Event of Default is existing. Lessee shall

                                     - 13 -
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pay any Imposition (and related costs) promptly after forgoing any contest or
after receipt of a final non-appealable adverse judgment.

     Section 8.7. ADJUSTMENT OF IMPOSITIONS. Impositions with respect to a
Property for a billing period during which Lessee's obligation to indemnify
Lessor pursuant to this Lease expires or terminates as to the Property shall be
adjusted and prorated on a daily basis between Lessor and Lessee, whether or not
such Imposition is imposed before or after such expiration or termination, and
Lessee's and Lessor's obligation to pay its pro rata share thereof shall survive
such expiration or termination (to the extent, with respect to Lessor, it is
obligated to reimburse Lessee for Impositions paid by Lessee for periods after
expiration of the Lease Term). Lessor acknowledges that Lessee may bring any tax
certiorari or other actions for refunds of Impositions or adjustments of
Impositions for which Lessee is liable under this Lease, or relating to periods
prior to the commencement date of the Term and Lessee shall be entitled to all
such refunds; provided Lessee shall take no such action which could increase any
Imposition for a period after the expiration of the Lease. During the Term,
Lessor agrees to cooperate with Lessee in such proceedings, at no cost to
Lessor.

     Section 8.8. UTILITY CHARGES. Lessee shall pay or cause to be paid,
directly to the party entitled, all charges for electricity, power, gas, oil,
water, telephone, sanitary sewer services and all other utilities used in or
on the Property prior to and during the Lease Term, and such obligation on
the part of Lessee shall survive the expiration or earlier termination of
this Lease until all such outstanding balances for services rendered prior to
or during the term of this Lease have been paid. Any refunds of such charges
attributable to the Term or the period prior to the commencement of the Term
shall be the property of Lessee, and Lessor shall pay the same to Lessee
promptly upon its receipt thereof. Lessee shall have the right to select all
service providers for the Property. Lessor shall not be entitled to charge
any fees associated with Lessee's acquisition and/or use of utilities.

     Section 8.9. LITIGATION; ZONING; JOINT ASSESSMENT. Lessee shall give prompt
written notice to Lessor and the Lender of any litigation or governmental
proceedings pending or threatened against Lessee or the Property of which Lessee
has actual knowledge, which could reasonably be expected to materially adversely
affect the condition or business of the Property. Lessee shall not initiate any
zoning reclassification for the Property, or any portion thereof, or seek any
variance under any existing zoning ordinances or use or permit the use of any
portion of the Property in any manner that could result in such use becoming a
non-conforming use under any zoning ordinance or any other Applicable Law.
Lessee shall not initiate any proceeding to cause the Property to be jointly
assessed with any other property or with any personal property of Lessee, or
take any other action or initiate any proceeding which might cause the personal
property of the Lessee to be taxed in a manner whereby such taxes or levies
could be assessed against the Property.

                                    ARTICLE 9
                                    INSURANCE

     Section 9.1. COVERAGE. (a) Subject to Section 9.l(b), Lessee shall maintain
insurance of the types and in the amounts set forth on Schedule 9.1 attached
hereto and made a part hereof.

                                     - 14 -
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     (b)  So long as (i) no Lease Event of Default has occurred and is
continuing and (ii) Lessee has a Required Rating at least equal to the Trigger
Rating, Lessee shall be entitled to self-insure against any and all risks it
would otherwise be required to insure against under Section 9.1 (a), provided
that such self-insurance program of this subsection (b) does not violate any
Applicable Law. During any period that Lessee is self insuring, Lessee shall not
be required to deliver any policies, certificates or other evidence of insurance
other than a certificate of self-insurance acknowledging Lessee's insurance
obligation under the Lease, and confirming Lessee's decision to self-insure (to
the extent Lessee is in fact self insuring). If Lessee does not, or is not
permitted to, self-insure, then (i) Lessee shall maintain a policy or policies
of commercial general liability insurance with respect to the Property, and
shall cause Lessor and the Lender to be named as an additional insured on such
policy or policies and (ii) Lessee shall maintain a policy or policies of
property insurance with respect to the Property, and Lessee shall cause Lessor
and the Lender to be named loss payee as their interests may appear on such
policy or policies, all in forms and amounts as set forth in Schedule 9.1.

     (c)  Nothing in this Article 9 shall prohibit the Lessee from maintaining
at its expense insurance on or with respect to the Property, naming the Lessee
as insured and/or loss payee for an amount greater than the insurance required
to be maintained under this Section 9.1, unless such insurance would conflict
with or otherwise limit the availability of or coverage afforded by insurance
required to be maintained under Section 9.1. Nothing in this Section 9.1 shall
prohibit the Lessor from maintaining at its expense other insurance on or with
respect to the Property or the operation, use and occupancy of the Property,
naming the Lessor as insured and/or payee, unless such insurance would conflict
with, cause the Lessor to be a coinsurer or otherwise limit or adversely affect
the ability to obtain, or the cost of the insurance required to be maintained
under Section 9.1.

     (d)  Copies of any certificates required to be delivered under Schedule 9.1
shall be delivered to Lessor at the same time delivered to the Lender.

     (e)  Irrespective of the cause thereof, Lessor shall not be liable for any
loss or damage to any buildings or other portion of the Property resulting from
fire, explosion or any other casualty. In the event of Lessee's failure to
obtain or maintain the insurance called for under this Lease after notice and
applicable grace, Lessor shall have the right, together with Lessor's remedies
set forth herein, to obtain the policies of insurance required under this Lease
and to bill Lessee for the premium payments therefor, together with interest at
the Default Rate. Lessor shall have no obligation to maintain insurance of any
nature or type whatsoever.

     (f)  In the event Lessee elects to self-insure, it shall be obligated to
use or pay to third parties, all amounts that Lessor, or such third party, would
have received had Lessee not self-insured. The foregoing shall not, however,
act as a limit on Lessee's liability. Sums due from Lessee in lieu of insurance
proceeds because of Lessee's self-insurance program shall be treated as
insurance proceeds for all purposes under this Lease.

     (g)  Each policy required to be carried by Lessee under this Lease shall
also provide that any loss otherwise payable thereunder shall be payable
notwithstanding any act or omission of Lessor or Lessee which might, absent such
provision, result in a forfeiture of all or a part of such insurance payment.

                                     - 15 -
<Page>

     (h)  Lessee shall comply with all insurance requirements applicable under
any insurance policies required to be maintained under this Lease.

                                   ARTICLE 10
                          RETURN OF PROPERTY TO LESSOR

     Section 10.1. RETURN OF PROPERTY TO LESSOR. Lessee shall, upon the
expiration or termination of this Lease, and at its own expense, return the
Property to Lessor by surrendering the same into the possession of Lessor:

     (a)  free and clear of all Liens (whether by payment or bonding), except
that Lessee shall have no responsibility or liability in respect of (i) Lessor
Liens, (ii) any Lien created by the Mortgage and related debt documents, and
(iii) Liens for taxes not yet due and payable; and

     (b)  in compliance in all material respects with all Applicable Laws and in
compliance with the maintenance conditions required by this Lease. All
Alterations and Lessee's Equipment and Personalty not removed by Lessee by the
last day of the Lease Term (but in the event of a termination other than upon
the expiration of the Base Term or any Renewal Term, within thirty (30) days
after said termination of this Lease), other than those Alterations as to which
title shall vest in Lessor pursuant to Section 8.4, shall be deemed abandoned in
place by Lessee and shall become the property of Lessor. Lessee shall pay or
reimburse Lessor for any reasonable, actual, out-of-pocket costs incurred by
Lessor in connection with the removal or disposal of such relinquished property,
which obligation shall survive the expiration or termination of this Lease. In
no event shall Lessee be required to remove or pay for the removal of any built
in, permanent fixtures or improvements existing on, or within, the Property as
of the date of this Lease or for any raised computer floors built during the
Term or for any other Alterations made in compliance with the terms of this
Agreement, or for any cabling or wiring (or similar property) now or hereafter
located on or in the Property.

     Upon the return of the Property, Lessee shall deliver therewith:

          (i)   all transferable licenses and permits pertaining to the Property
     by general assignment, without warranty or recourse;

          (ii)  as built-drawings including plans for HVAC, mechanical and
     electrical systems, to the extent in Lessee's possession and not previously
     delivered to Lessor;

          (iii) keys to the Property; and

          (iv)  assignment of all maintenance contracts (to the extent required
     by Lessor) and existing warranties applicable to the Property by general
     assignment, without warranty or recourse to the extent assignable.

     Lessee agrees to reasonably cooperate with Lessor and its representatives
to effectuate a smooth transition of the operation and maintenance of the
Property. Notwithstanding anything expressly to the contrary hereunder,
providing Lessee surrenders the Property and all Alterations and Equipment upon
the expiration or termination of this Lease in compliance with all

                                     - 16 -
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Applicable Laws, the failure to remove any of Lessee's Alterations or Equipment
in accordance with the provisions hereof shall not result in Lessee being deemed
a holdover tenant hereunder.

                                   ARTICLE 11
                              ASSIGNMENT BY LESSEE

     Section 11.1. ASSIGNMENT BY LESSEE. So long as no Lease Event of Default
has occurred and is continuing, Lessee may, at Lessee's sole expense, without
the consent of Lessor, assign this Lease for a period that does not extend
beyond the Lease Term, to any Person, PROVIDED, HOWEVER, that any such Person or
other Person is not (I) a tax-exempt entity (within the meaning of Section
168(h) of the Code) or (II) a debtor or debtor-in- possession in a voluntary or
involuntary bankruptcy proceeding at the commencement of the assignment. For
purposes hereof, an assignment shall include a merger or consolidation of
Lessee. Any assignee shall assume in writing any obligations of Lessee arising
from and after the effective date of the assignment, PROVIDED, HOWEVER, that no
such assignment shall become effective until (i) a fully executed copy of an
assignment and assumption agreement shall have been delivered to Lessor and the
Lender, and (ii) such assignee shall have executed such instruments and other
documents and provided such further assurances as the Lender shall reasonably
request to ensure that such assignment is subject to the Mortgage and any
related debt documents. Notwithstanding any such assignment, Lessee shall not be
released from its primary liability hereunder and shall continue to be obligated
for all obligations of "Lessee" in this Lease, which obligations shall continue
in full effect as obligations of a principal and not of a guarantor, as though
no assignment had been made. Lessee will have the right, subsequent to any
assignment (a) to receive a duplicate copy of each notice of default sent by
Lessor to any assignee (but such notice shall be effective as against the
Lessee, as well as any subsequent assignees, even if a copy has not been
delivered to such requesting assignee), and (b) to cure any default by any
assignee under the Lease within the cure period provided for hereunder. Lessee's
liability hereunder shall continue notwithstanding the rejection of this Lease
by an assignee or any sublease of this Lease pursuant to Section 365 of Title 11
of the United States Code, any other provision of the Bankruptcy Code, or any
similar law relating to bankruptcy, insolvency, reorganization or the rights of
creditors, which arises subsequent to such assignment. In the event Lessee
assigns this Lease and it shall thereafter be rejected in a bankruptcy or
similar proceeding, a new lease identical to this Lease shall be re-instituted
as between Lessor and Lessee without further act of either party, provided
Lessor shall not be obligated to deliver to Lessee possession of the Property
free of any tenancy created or caused by Lessee or any entity holding by or
through Lessee but Lessee may, in Lessor's name, but at Lessee's expense, take
such action as it deems appropriate to have such assignee removed from the
Property. Lessor shall reasonably cooperate with Lessee in such efforts. Nothing
herein shall be construed to permit Lessee to mortgage, pledge, hypothecate or
otherwise collaterally assign in any manner or nature whatsoever Lessee's
interest under this Lease in whole or in part. Lessee shall provide written
notice to Lessor and the Lender of any assignment of this Lease within thirty
(30) days after the effective date thereof and an executed copy of the approved
agreement of assignment and assumption within thirty (30) days after the
execution thereof. To the extent an assignee of this Lease fails to perform on
behalf of Lessee the obligations of Lessee hereunder, and Lessee performs such
obligations, then Lessee shall be subrogated to the rights of Lessor as against
such assignee in respect of such performance.

                                     - 17 -
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                                   ARTICLE 12
                    LOSS; DESTRUCTION; CONDEMNATION OR DAMAGE

     Section 12.1. EVENT OF LOSS. If there shall occur an Event of Loss with
respect to the Property (the "AFFECTED PROPERTY (for purposes of this Lease, the
Affected Property being the entire Property)"), Lessee shall give Lessor and the
Lender prompt written notice thereof and elect, within sixty (60) days after the
occurrence of the Event of Loss, one of the following options:

          (i)      Offer to purchase the Affected Property from Lessor, on a
     Rent Payment Date, which date shall be a date for which a value is set
     forth on Schedule 12.1 hereto (the "STIPULATED LOSS VALUE DATE"), and which
     Rent Payment Date shall be the first Rent Payment Date at least forty (40)
     days after Lessor accepts such offer, for a purchase price equal to the sum
     of (A) the Stipulated Loss Value for the Affected Property, determined as
     of such Stipulated Loss Value Date, plus (B) all unpaid Rent with respect
     to the Affected Property due but unpaid through such Stipulated Loss Value
     Date, plus (C) an amount equal to the reasonable out-of-pocket attorneys'
     fees of Lessor relating to the purchase by Lessee as a result of such Event
     of Loss. Lessor (subject to the consent of the Lender), shall have sixty
     (60) days from the date of receipt of Lessee's offer to decide whether to
     reject such offer. If Lessee has not received a response after forty (40)
     days, it may send, a second notice to the foregoing parties, stating
     clearly in boldface that LESSOR'S failure to reject such offer by the later
     of (i) the original sixty (60) day period, or (ii) ten (10) days after
     delivery of such second notice, shall be deemed Lessor's acceptance of such
     offer; or

          (ii)     Restore and rebuild the Improvements damaged as a result of
     such Event of Loss (regardless of the availability of any insurance
     proceeds) so as to have a value, utility and remaining useful life as
     nearly as reasonably practicable equal to the value, utility and remaining
     useful life of the Affected Property immediately prior to such Event of
     Loss, and in all events as required by Section 8.2, such restoration to be
     done as expeditiously as is commercially reasonable and to be substantially
     completed, subject to FORCE MAJEURE, within twenty four months from the
     date of the Event of Loss, and in any event by the expiration of the Lease
     Term (and Lessee shall remain liable for the completion of such restoration
     beyond the expiration of the Lease Term to the extent not completed prior
     to such expiration but Lessee's obligation to complete the Improvements
     shall not constitute a holdover by Lessee, who shall be granted access to
     the Property for such completion). In the event, due to force majeure
     events, restoration cannot be completed by the expiration of the Term,
     Lessee shall diligently complete the restoration thereafter and shall be
     liable to pay Base Rent (based on the Base Rent in effect on the day prior
     to the expiration of the Term (on a per diem basis)) and Supplemental Rent,
     until such restoration, is complete.

     If Lessee makes an offer to purchase pursuant to clause (i) above of this
Section 12.1, and Lessor accepts such offer or is deemed to accept such offer
within the sixty (60) day period referred to in the last sentence of clause (i)
above, the conveyance shall occur, and Lessee shall pay to Lessor the Stipulated
Loss Value and Rent described in said clause (i) on the Stipulated Loss Value
Date; PROVIDED that any Net Proceeds related to the Affected Property then held
by

                                     - 18 -
<Page>

Lessor or the Lender shall be credited against the portion of such purchase
price payable to Lessor and the balance of Net Proceeds, if any, shall be paid
to or retained by Lessee. Concurrently with the payment in full of the amounts
payable pursuant to said clause (i), the terms of Article 22 shall be complied
with.

     In the event Lessor rejects the offer of Lessee to purchase the Affected
Property as provided in clause (i) of this Section 12.1 (which it may not do
without the Lender's written consent unless it first pays to the Lender an
amount sufficient to pay all amounts due Lender with respect to the Affected
Property), the following amount shall be paid to or retained by Lessor on such
Stipulated Loss Value Date: (A) all Net Proceeds related to the Affected
Property, PROVIDED THAT, if Lessee is self-insured (as permitted above) by means
of deductibles, retained risks or no insurance whatsoever, Lessee shall pay such
amounts or additional amounts so that Lessor receives in total (including any
Net Proceeds) an amount that would have been paid by a third-party insurer under
a customary commercial all-risk full replacement-value insurance policy
substantially similar to that described in Schedule 9.01(a)(ii) without
deductibles or retained risks (but in any case amounts paid to Lessor will not
be in excess of the replacement value of the Improvements immediately preceding
the Event of Loss, which replacement value shall be as mutually agreed between
Lessee and Lessor and, failing such agreement within fifteen (15) days of the
request of either party to do so, by the Appraisal Procedure), plus (B) unpaid
Rent due with respect to the Affected Property on and through such Stipulated
Loss Value Date.

     Upon payment in full of the amounts set forth in clauses (A) and (B) of
the preceding paragraph (in the event Lessor rejected Lessee's offer) or upon
payment in full of the amounts set forth in clause (i) of the first sentence of
this Section 12.1 and consummation of the sale to Lessee (or its designee) (in
the event Lessor accepted Lessee's offer to purchase), (1) the Lease Term shall
end, and (2) the obligations of Lessee hereunder (other than any obligations
expressed herein as surviving termination of this Lease) shall terminate as of
the date of such payment.

     If Lessor elects to reject the offer of Lessee hereunder to purchase the
Property pursuant to this Section 12.1 while a Mortgage encumbers the Property,
any notice of rejection shall only be effective, and Lessor shall only be
entitled to reject such offer, if such notice is in writing and either such
rejection is concurrently consented to in writing by the Lender or Lessor
concurrently with delivery of its rejection notice pays to the Lender all
amounts secured by the Mortgage with respect to the Affected Property, and
reasonably evidences such payment to Lessee, and absent such repayment or
consent by the Lender within the period referred to in the last sentence of
clause (i) above, Lessor shall be deemed to have accepted Lessee's offer.

     Section 12.2. APPLICATION OF PAYMENTS UPON AN EVENT OF LOSS WHEN LEASE
CONTINUES. Subject to Section 12.4, payments received at any time by Lessor or
Lessee from any Governmental Authority or insurance carrier or other Person with
respect to any Event of Loss in a case in which this Lease will not terminate
(and there will occur no abatement or reduction of rent) because Lessee has
elected to proceed, under clause (ii) of Section 12.1, shall be paid to Lessee
to be applied, as necessary, to the repair or restoration of the Property as
described in clause (ii) of Section 12.1. Any excess insurance proceeds
remaining thereafter shall be retained by Lessee. In the event of a condemnation
which does not result in a termination of the Lease,

                                     - 19 -
<Page>

the proceeds of the condemnation award remaining after repair and restoration,
to the extent the excess equals or exceeds $500,000.00, shall be paid to the
Lessor. The first $500,000.00 of excess condemnation proceeds shall be allocated
between Lessor and Lessee as set forth on Schedule 12.2 attached hereto. In no
event shall Rent be adjusted.

     Section 12.3. APPLICATION OF PAYMENTS NOT RELATING TO AN EVENT OF LOSS. In
case of a Condemnation or Casualty which is not an Event of Loss or which does
not result in a termination of this Lease in accordance with the above
provisions of Article 12, this Lease shall remain in full force and effect,
without any abatement or reduction of Rent. Subject to Section 12.4, all Net
Casualty Proceeds and all Net Condemnation Proceeds, as the case may be, shall
be paid to Lessee to be applied, as necessary, to the repair or restoration of
the Property so such Property shall have a value, utility and remaining useful
life as close as reasonably practicable to the value, utility and remaining
useful life existing immediately prior to such Casualty or Condemnation. Any
excess insurance proceeds remaining thereafter shall be retained by Lessee and
any excess condemnation award remaining thereafter in excess of $500,000.00
shall be paid to Lessor. The first $500,000.00 of excess condemnation proceeds
shall be divided by Lessor and Lessee as set forth on Schedule 12.2.

     Section 12.4. OTHER DISPOSITIONS. (a) Net Casualty Proceeds or Net
Condemnation Proceeds, as the case may be, in excess of the Threshold Amount (as
such amount may be increased by increases in the CPI, as calculated in the
manner set forth in Section 8.3(a)) (each, as applicable, the "RESTORATION
FUND") in respect of such Casualty or Condemnation, as the case may be, shall be
paid to the Proceeds Trustee for release to Lessee as restoration progresses,
subject to and in accordance with Section 12.4(b). Lessor and Lessee hereby
authorize and direct (i) any insurer, to make payment in excess of the Threshold
Amount under policies of casualty insurance required to be maintained by Lessee
pursuant to Section 9.1 (a) directly to the Proceeds Trustee instead of to
Lessor and Lessee jointly, and (ii) any Governmental Agency to make payments of
any Net Condemnation Proceeds in excess of the Threshold Amount directly to the
Proceeds Trustee instead of to Lessor and/or Lessee; and each of Lessee and
Lessor hereby appoints the Proceeds Trustee as its attorney-in-fact to endorse
any draft therefor for the purposes set forth in this Lease after approval by
Lessee of the Proceeds Trustee, if the Proceeds Trustee is other than the
Lender. In the event that a Casualty shall occur at such time as Lessee shall
not have maintained property or casualty insurance to the extent required by
said Section 9.1 (a) (I.E., Lessee is self insuring in whole, or in part),
Lessee shall be obligated to pay itself towards restoration the amount it self
insures. Lessee shall be obligated to pay the Threshold Amount (or any amount it
self-insured) towards restoration costs prior to the disbursement of any funds
from the Restoration Fund.

     (b)  The Restoration Fund, if any, shall be disbursed by the Proceeds
Trustee by wire transfer of immediately available funds within five (5) Business
Days of the last submission made pursuant to and in accordance with the
following conditions (provided that there shall be no more than one disbursement
during each month):

          (i)      At the time of any disbursement, no Lease Event of Default
     shall exist and, subject to Article 7, no mechanics' or materialmen's liens
     shall have been filed and remain undischarged, unbonded or not insured
     over.

                                     - 20 -
<Page>

          (ii)     Disbursements (subject to the holdback in Section 12.4(b)(iv)
     below) shall be made from time to time in an amount not exceeding the hard
     and soft cost of the work and costs incurred since the last disbursement
     upon receipt of (1) satisfactory evidence, including architects'
     certificates when required pursuant to Section 8.3, of the stage of
     completion, of the estimated cost of completion and of performance of the
     work to date in a good and workmanlike manner in accordance with the
     contracts, plans and specifications, (2) partial releases of liens from
     Lessee's general contractor in respect of the disbursement made pursuant to
     the immediately preceding request, and (3) other reasonable evidence of
     cost incurred (whether or not paid) so that the Proceeds Trustee is able to
     verify that the amounts disbursed from time to time are represented by work
     that is completed in place or delivered to the site and free and clear of
     (subject to Article 7), mechanics' and materialmen's lien claims.

          (iii)    Each request for disbursement shall be accompanied by a
     certificate of Lessee (1) agreeing to use amounts disbursed for the costs
     described in Section 12.4(b)(ii), (2) describing the work, materials or
     other costs or expenses for which payment is requested, (3) stating the
     cost incurred in connection therewith, (4) stating that Lessee has paid
     costs and expenses for such work in an amount equal to the self insured
     and/or deductible amounts as permitted by Section 9.1(b) (and attaching
     thereto evidence thereof reasonable satisfactory to Lessor) and (5) stating
     that Lessee has not previously received payment for such work or expense
     and the certificate to be delivered by Lessee upon completion of the work
     shall, in addition, state that the work has been substantially completed
     and complies with the applicable requirements of this Lease.

          (iv)     The Proceeds Trustee shall retain ten percent (10%) of the
     amounts otherwise disbursable until the restoration is at least fifty
     percent (50%) complete, and thereafter five percent (5%) until the
     restoration is substantially complete.

          (v)      The Restoration Fund shall be kept by the Proceeds Trustee in
     a separate interest-bearing federally insured account or invested in
     Permitted Investments (as directed by, or on behalf of, Lessee).

          (vi)     Prior to commencement of restoration and at any time during
     restoration, if the estimated cost of restoration, as reasonably determined
     by the Proceeds Trustee, exceeds the then amount of the Restoration Fund,
     Lessee shall fund at its own expense the costs of such restoration until
     the remaining Restoration Fund is sufficient for the completion of the
     restoration. In the case of Casualty, any sum in the Restoration Fund which
     remains in the Restoration Fund upon the completion of restoration shall be
     paid to Lessee. In the case of Condemnation, any sum in the Restoration
     Fund which remains in the Restoration Fund upon the completion of
     restoration shall be applied as set forth in Section 12.2.

     Section 12.5. NEGOTIATIONS. In the event the Property becomes subject to
condemnation or requisition proceedings, Lessee shall control the negotiations
with the relevant Governmental Authority, unless: (i) a Lease Event of Default
shall be continuing, or (ii) the Net Condemnation Proceeds will likely be in
excess of the Threshold Amount (as such amount may be increased by increases in
the CPI, as calculated in the manner set forth in Section 8.3(a), above) (which

                                     - 21 -
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determination shall be made in Lessor's reasonable discretion), in which case
Lessor (or Lender, if there is one) may elect in writing to control such
negotiations; PROVIDED that in any event Lessor may elect to participate in such
negotiations, Lessee shall give to Lessor and the Lender such information, and
copies of such documents, which relate to such proceedings and are in the
possession of Lessee, as are reasonably requested by Lessor or the Lender.
Lessor shall confer with Lessee as to any negotiations with Governmental
Authorities material to Lessee's operations and shall not agree to any act that
would have a material adverse effect on Lessee's business. Notwithstanding the
foregoing, in jurisdictions where a separate award may be granted for Lessee's
Equipment and Personalty, moving and relocation expenses, business loss,
business damages, loss of goodwill, unamortized costs of any Alterations title
for which has not vested in Lessor pursuant to the terms of this Lease, and
Lessee's attorneys' fees, costs and expenses in the proceedings, Lessee may
assert claims for and control the negotiations pertaining to such interests,
PROVIDED that the Lessor's award in respect to the Property is not diminished by
the award to Lessee. Lessee acknowledges that no payments shall be permitted
hereunder other than on a Rent Payment Date.

                                   ARTICLE 13
                             INTENTIONALLY OMITTED

                                   ARTICLE 14
                                    SUBLEASE

     Section 14.1. SUBLEASING PERMITTED; LESSEE REMAINS OBLIGATED. Provided that
no Lease Event of Default shall have occurred and be continuing at the time the
sublease is entered into, upon fifteen (15) days' prior written notice to Lessor
and the Lender (except for subleases to Affiliates, in which case no notice
shall be required), Lessee may at any time and from time to time sublease the
Property or any portion or portions thereof to any Person or permit the
occupancy of the Property or any portion or portions thereof by any Person who
is not a debtor or debtor-in-possession in a voluntary or involuntary bankruptcy
proceeding at the commencement of the sublease term. Any such sublease,
sub-sublease, license, occupancy agreement or similar agreement (each, a
"SUBLEASE") shall not release Lessee from its primary liability for the
performance of its duties and obligations hereunder, and Lessee shall continue
to be obligated for all obligations of "Lessee" in this Lease, which obligations
shall continue in full effect as obligations of a principal and not of a
guarantor, as though no Sublease had been made. From time to time, but in no
event more than once annually, upon Lessor's request, Lessee shall forward to
Lessor the names, businesses and square footage leased (or location) of all
subtenants (other than Subleases to Affiliates).

     Section 14.2. PROVISIONS OF SUBLEASES. Each Sublease will:

     (a)  be expressly subject and subordinate to this Lease and any mortgage
(including the Mortgage) encumbering the Property;

     (b)  not extend beyond the Lease Term minus one day; and

     (c)  terminate upon any termination of this Lease, unless Lessor elects in
writing (which election must be consented to by the Lender), to cause the
sublessee to attorn to and

                                     - 22 -
<Page>

recognize Lessor as the lessor under such Sublease, whereupon such Sublease
shall continue as a direct lease between the sublessee and Lessor upon all the
terms and conditions of such Sublease (it being agreed that all Subleases with
Affiliates of Lessee shall automatically terminate upon termination of this
Lease).

     Section 14.3. ASSIGNMENT OF SUBLEASE RENTS. To secure the prompt and full
payment by Lessee of the Rent and the faithful performance by Lessee of all the
other terms and conditions herein contained on its part to be kept and
performed, Lessee hereby absolutely, presently assigns, transfers and sets over
unto Lessor, subject to the conditions hereinafter set forth in this Section
14.3, all of Lessee's right, title and interest in and to all Subleases, and
hereby confers upon Lessor, its agents and representatives, a right of entry in,
and sufficient possession of, the Property to permit and ensure the collection
by Lessor of the rentals and other sums payable under the Subleases, and further
agrees that the exercise of the right of entry and qualified possession by
Lessor shall not constitute an eviction of Lessee from the Property or any
portion thereof; PROVIDED, HOWEVER, that Lessee shall continue to have the right
to collect, use, enjoy and distribute all Sublease revenue (a) except during the
continuance of a Lease Event of Default, or (b) until this Lease and the Lease
Term shall be canceled or terminated pursuant to the terms, covenants and
conditions hereof, or (c) until there occurs repossession under a dispossess
warrant or other judgment, order or decree of a court of competent jurisdiction
and then only as to such of the Subleases that Lessor may elect to take over and
assume. Notwithstanding the foregoing, if the events described in Section
14.3(b) and Section 14.3(c) herein above have not occurred and if the Lease
Event of Default which caused such collection of revenue by Lessor shall have
been cured by Lessee or otherwise not continue to exist, upon the written demand
of Lessee, Lessor shall cease to exercise the rights granted hereunder to Lessor
with respect to the Subleases, and amounts collected under the Subleases and not
applied to Lessee's obligations hereunder shall promptly be paid over to Lessee.

                                   ARTICLE 15
                                   INSPECTION

     Section 15.1. INSPECTION. Upon at least five (5) Business Days' prior
written notice to Lessee (or immediately if a Lease Event of Default shall be
continuing) Lessor or the Lender and their respective representatives and agents
(each, an "INSPECTING PARTY"), may, in a commercially reasonable manner and at
their own risk, inspect the Property, during normal business hours, to verify
compliance with the provisions of this Lease. No Sublease shall contain any
restrictions on inspection other than as set forth herein. The Inspecting Party
shall repair any damage caused by any inspection performed pursuant to Section
15.1. Unless a Lease Event of Default is continuing, no intrusive tests are
permitted. Lessee shall have the right during such inspection to have its
representatives present at any such inspection, including security guards. In
addition, Lessee may designate one or more reasonably sized "secure areas" to
which Lessor or Lender shall have no access, except during the continuance of a
Lease Event of Default. Each Inspecting Party agrees to hold in confidence all
proprietary information and trade secrets of which it becomes aware during such
inspection. All such inspections shall be at Lessor's expense, unless a Lease
Event of Default occurs and is continuing. Further, upon fifteen (15) Business
Days' prior notice to Lessee, but no more than once annually, the Inspecting
Parties, at their expense, may inspect the books and records as they relate to
the maintenance and care of the Property during the term of this Lease (other
than Lessee's

                                     - 23 -
<Page>

Equipment and Personalty), that are in the possession of Lessee, which shall be
made available at the Property or the headquarters of the Lessee. Such
inspection shall be at the cost of the Inspecting Party unless a Lease Event of
Default exists, in which event Lessee shall pay such costs.

                                   ARTICLE 16
                             LEASE EVENTS OF DEFAULT

     Section 16.1. LEASE EVENTS OF DEFAULT. The following events shall
constitute a "Lease Events of Default":

     (a)  Lessee shall fail to make any payment of Base Rent, a Termination
Value Payment or a Stipulated Loss Value Payment within five (5) Business Days
after notice that such amount is due and unpaid;

     (b)  Lessee shall fail to make any late payment and/or Default Interest
within ten (10) days after notice that such amount is due and unpaid;

     (c)  Lessee shall fail to make any other payment of Supplemental Rent,
other than any amount described in clause (a) or clause (b) of this Article 16,
and such failure shall continue for a period of ten (10) days after notice of
such failure to Lessee from Lessor or Lender;

     (d)  Lessee shall fail to timely perform or observe any covenant or
agreement (not otherwise specified in this Article 16) to be performed or
observed by it hereunder and such failure shall continue for a period of thirty
(30) days after written notice thereof from Lessor or the Lender; PROVIDED that
the continuation of such a failure for thirty (30) days or longer after such
notice shall not constitute a Lease Event of Default if such failure can be
cured, but cannot reasonably be cured within such thirty (30) day period, and
Lessee shall commence to cure such failure within such thirty (30) day period
and shall be diligently and continuously prosecuting the cure of such failure.

     (e)  except to the extent the Lessee is permitted to self-insure pursuant
to Section 9.1(b) and Schedule 9.1, Lessee shall fail to carry or maintain in
full force any insurance required hereunder, and such failure shall continue for
five (5) business days after such obligations arises, but not beyond the
expiration date of any required policy of insurance;

     (f)  any representation or warranty made by the Lessee herein shall prove
to have been incorrect in any material respect when such representation or
warranty was made and shall remain materially incorrect at the time in question,
and is not cured in all material respects within thirty (30) days of notice to
Lessee of such breach; PROVIDED that the continuation of such a failure for
thirty (30) days or longer after such notice shall not constitute a Lease Event
of Default if such failure can be cured, but cannot reasonably be cured within
such thirty (30) day period, and Lessee shall commence to cure such failure
within such thirty (30) day period and shall be diligently and continuously
prosecuting the cure of such failure.

     (g)  (A) Lessee makes any general arrangement or assignment for the benefit
of creditors; (B) Lessee becomes a "debtor" as defined in 11 U.S.C. Section 101
or any successor statute thereto (unless, in the case of a petition filed
against Lessee, the same is dismissed within ninety

                                     - 24 -
<Page>

(90) days); (C) the appointment of a trustee or receiver to take possession of
substantially all of the assets of Lessee where possession is not restored to
Lessee within ninety (90) days; (D) the attachment, execution or other judicial
seizure of substantially all of the assets of Lessee where such seizure is not
discharged within ninety (90) days; (E) Lessee admits in writing its inability
to pay its debts generally as they become due; (F) Lessee files a petition or
answer seeking reorganization or arrangement or other protection under the
Federal bankruptcy laws or any other applicable law or statute of the United
States of America or any State thereof; (G) Lessee is liquidated or dissolved,
or placed under conservatorship or other protection under any applicable
federal or state law; (H) any petition is filed by or against Lessee under
Federal bankruptcy laws, or any other proceeding is instituted by or against
Lessee seeking to adjudicate it a bankrupt or insolvent, or seeking liquidation,
reorganization, arrangement, adjustment or composition of it or its debts under
any law relating to bankruptcy, insolvency or reorganization or relief of
debtors, or seeking the entry of an order for relief or the appointment of a
receiver, trustee, custodian or other similar official for Lessee, or for any
substantial part of the property of Lessee, and such proceeding is not dismissed
within ninety (90) days after institution thereof, or Lessee shall take any
action to authorize or effect any of the actions set forth above in this
subsection (g).

                                   ARTICLE 17
                                  ENFORCEMENT

     Section 17.1. REMEDIES. Upon the occurrence of any Lease Event of Default
and at any time thereafter so long as the same shall be continuing, Lessor may,
at its option, by notice to Lessee do one or more of the following as Lessor in
its sole discretion shall determine:

     (a)  Lessor may, by notice to Lessee, terminate this Lease as of the date
specified in such notice; PROVIDED (i) no reletting, reentry or taking of
possession of any or all of the Property by Lessor will be construed as an
election on Lessor's part to terminate this Lease unless a written notice of
such intention is given to Lessee, (ii) notwithstanding any reletting, reentry
or taking of possession, Lessor may at any time thereafter elect to terminate
this Lease with respect to any or all of the Property, and (iii) no act or thing
done by Lessor or any of its agents, representatives or employees and no
agreement accepting a surrender of any or all of the Property shall be valid
unless the same be made in writing and executed by Lessor. If Lessor shall have
terminated the Lease, Lessor may demand that Lessee pay to Lessor, and Lessee
shall pay to Lessor, the amounts set forth in subparagraphs (c) or (e) below.

     (b)  Lessor may whether or not the Lease is terminated (i) demand that
Lessee, and Lessee shall upon the written demand of Lessor, return the Property
promptly to Lessor in the manner and condition required by, and otherwise in
accordance with all of the provisions of, Article 10 as if the Property were
being returned at the end of the Lease Term, and Lessor shall not be liable for
the reimbursement of Lessee for any costs and expenses incurred by Lessee in
connection therewith, and (ii) without prejudice to any other remedy which
Lessor may have for possession of the Property, enter upon the Property and take
immediate possession of (to the exclusion of Lessee) the Property and expel or
remove Lessee and any other person who may be occupying the same (subject to the
terms of any nondisturbance agreements with Lessor in favor of any subtenants),
by summary proceedings or otherwise, all without liability to Lessor for or by
reason of such entry or taking of possession, whether for the restoration of
damage to property

                                     - 25 -
<Page>

caused by such taking or otherwise and, in addition to Lessor's other damages,
Lessee shall be responsible for the reasonably necessary costs and expenses of
reletting actually incurred.

     (c)  Lessor may sell the Property at public or private sale, as Lessor may
determine, free and clear of any rights of Lessee and without any duty to
account to Lessee with respect to such action or inaction or any proceeds with
respect thereto (except to the extent required by the next succeeding sentence
if Lessor shall elect to exercise its rights thereunder), in which event
Lessee's obligation to pay Base Rent hereunder for periods commencing after the
Stipulated Loss Date next succeeding the date of such sale shall be terminated.
If Lessor shall have sold any of the Property pursuant to the above terms of
this Section 17.1(c), Lessor may demand that Lessee pay to Lessor, and Lessee
shall promptly pay to Lessor, on the date of such sale, as liquidated damages
for loss of a bargain and not as a penalty (the parties agreeing that Lessor's
actual damages would be difficult to predict, but the liquidated damages
described below represent a reasonable approximation of such amount), in lieu of
Base Rent in respect of the Property due for the period commencing on the
Stipulated Loss Date next succeeding the date of sale, an amount equal to the
sum of:

          (1)   all unpaid Rent with respect to the Property due but unpaid
     through such Stipulated Loss Date; plus

          (2)   an amount equal to the present value of the amount of the Base
     Rent payments payable on the Business Day before the date preceding the
     remaining scheduled Rent Payment Dates, discounted monthly at the Reference
     Rate;

          (3)   interest at the Default Rate on all of the foregoing amounts
     from the date due until the date of actual payment;

     to the extent such amount exceeds the net proceeds of such sale.

     (d)  Except as Lessor may otherwise be required by Applicable Laws, Lessor
may hold, keep idle or lease to others the Property as Lessor in its sole
discretion may determine, free and clear of any rights of Lessee and without any
duty to account to Lessee with respect to such action or inaction or for any
proceeds with respect to such action or inaction, except that Lessee's
obligation to pay Base Rent from and after the occurrence of a Lease Event of
Default, but prior to the termination of the Lease or the foreclosure of the
Lien of the Lender, shall be reduced by the net proceeds, if any, received by
Lessor from leasing the Property to any Person, or allowing any Person to use
the Property, other than Lessee for the same periods or any portion thereof,

     (e)  Lessor may, whether or not Lessor shall have exercised or shall
thereafter at any time exercise any of its rights under Section 17.1(b) or
17.1(d), but only if the Property shall not have been sold under Section
17.1(c), demand, by written notice to Lessee specifying a Stipulated Loss Date
(the "FINAL PAYMENT DATE") not earlier than twenty (20) days after the date of
such notice, that Lessee pay to Lessor, and Lessee shall pay to Lessor, on the
Final Payment Date, as liquidated damages for loss of a bargain and not as a
penalty (the parties agreeing that Lessor's actual damages would be difficult to
predict, but the aforementioned liquidated

                                     - 26 -
<Page>

damages represent a reasonable approximation of such amount), in lieu of Base
Rent for periods commencing after the Final Payment Date, an amount equal to the
sum of:

          (1)      all unpaid Rent with respect to the Property due but unpaid
     through such Stipulated Loss Date; plus

          (2)      an amount equal to the present value of the amount of the
     Base Rent payments payable on the Business Day before the dates preceding
     the remaining scheduled Rent Payment Dates, discounted monthly at the
     Reference Rate;

          (3)      interest at the Default Rate on all of the foregoing amounts
     from the date due until the date of actual payment.

     (f)  Lessor may retain and apply against Lessor's damages all sums which
Lessor would, absent such Lease Event of Default, be required to pay to, or turn
over to, Lessee pursuant to the terms of this Lease; or

     (g)  Lessor may exercise any other right or remedy that may be available to
it under Applicable Laws or in equity, or proceed by appropriate court action
(legal or equitable) to enforce the terms hereof or to recover damages for the
breach hereof. A single or separate suits may be brought to collect any such
damages for any period or periods with respect to which Rent shall have accrued,
and such suits shall not in any manner prejudice Lessor's right to collect any
such damages for any subsequent period, or Lessor may defer any such suit until
after the expiration of the Base Term or the then current Renewal Term, in which
event such suit shall be deemed not to have accrued until the expiration of the
Base Term, or the then current Renewal Term.

     Section 17.2. SURVIVAL OF LESSEE'S OBLIGATIONS. No repossession of any or
all of the Property or exercise of any remedy under this Lease, including
termination of this Lease, shall, except as specifically provided herein,
relieve Lessee of any of its liabilities and obligations hereunder, including
the obligation to pay Rent. In addition, except as specifically provided herein,
Lessee shall be liable for any and all unpaid Rent due hereunder before, after
or during the exercise of any of the foregoing remedies, including all
reasonable legal fees and other costs and expenses incurred by Lessor and the
Lender by reason of the occurrence of any Lease Event of Default or the exercise
of Lessor's remedies with respect thereto, and including all costs and expenses
incurred in connection with the return of the Property in the manner and
condition required by, and otherwise in accordance with the provisions of,
Article 10 as if the Property were being returned at the end of the Lease Term.
At any sale of any or all of the Property or any other rights pursuant to
Section 17.1, Lessor or the Lender may bid for and purchase the Property.

     Section 17.3. REMEDIES CUMULATIVE; NO WAIVER; CONSENTS; MITIGATION OF
DAMAGES. To the extent permitted by, and subject to the mandatory requirements
of, Applicable Laws, each and every right, power and remedy herein specifically
given to Lessor or otherwise in this Lease shall be cumulative and shall be in
addition to every other right, power and remedy herein specifically given or now
or hereafter existing at law, in equity or by statute, and each and every right,
power and remedy whether specifically herein given or otherwise existing may be

                                     - 27 -
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exercised from time to time and as often and in such order as may be deemed
expedient by Lessor, and the exercise or the beginning of the exercise of any
power or remedy shall not be construed to be a waiver of the right to exercise
at the same time or thereafter any right, power or remedy. No delay or omission
by Lessor in the exercise of any right, power or remedy or in the pursuit of any
remedy shall impair any such right, power or remedy or be construed to be a
waiver of any default on the part of Lessee or to be an acquiescence therein.
Lessor's consent to any request made by Lessee shall not be deemed to constitute
or preclude the necessity for obtaining Lessor's consent, in the future, to all
similar requests. No express or implied waiver by Lessor of any Lease Event of
Default shall in any way be, or be construed to be, a waiver of any future or
subsequent Lease Event of Default. Lessor shall use reasonable efforts to
mitigate any damages suffered by Lessor that result from a Lease Event of
Default.

                                   ARTICLE 18
                          RIGHT TO PERFORM FOR LESSEE

     Section 18.1. RIGHT TO PERFORM FOR LESSEE. If Lessee shall fail to perform
or comply with any of its agreements contained herein, following applicable
notice and cure periods, Lessor may perform or comply with such agreement, and
Lessor shall not thereby be deemed to have waived any default caused by such
failure, and the amount of payment required to be made by Lessee hereunder and
made by Lessor on behalf of Lessee, and the reasonable out-of-pocket third-party
costs and expenses of Lessor (including reasonable attorneys' fees and expenses)
incurred in connection with the performance of or compliance with such
agreement, as the case may be, together with interest thereon at the Default
Rate, shall be deemed Supplemental Rent, payable by Lessee to Lessor upon
demand. In addition, during the continuance of a Lease Event of Default in
respect of Lessee's obligations under Section 8.2 and/or Section 8.5, then, in
addition to the rights above and at the cost of Lessee, (a) Lessor shall have
the right to hire Persons (as selected by Lessor in its reasonable discretion)
to cure such Lease Event of Default, and to take any and all other actions
necessary to cure such Lease Event of Default, and (b) Lessee shall cooperate
with Lessor, and the Persons hired by Lessor, in the performance of such cure,
including, without limitation, (i) providing access to the subject Property at
reasonable times every day of the week, (ii) making available water, electricity
and other utilities existing at or on the subject Property, and (iii)
restricting or closing the Property, but only if such restriction or closure is
reasonably necessary for the performance of such cure and provided that such
closure shall be done for and during a time period and in such manner that
balances the need for the maintenance or repair of the Property (and doing so in
a safe manner) and the continuing operations of the Property.

                                   ARTICLE 19
                                  INDEMNITIES

     Section 19.1. GENERAL INDEMNIFICATION. (a) Lessee agrees to indemnify,
defend, and keep harmless each Indemnitee, from and against any and all Claims
arising out of acts, or failures to act, prior to the expiration or earlier
termination of the Term (whether during the Lease Term, or prior to the Closing
Date), whenever they may be suffered, imposed on or asserted against any
Indemnitee, arising out of (i) the ownership, leasing, subleasing, assignment,
financing, refinancing, renewal, return, operation, possession, use, non-use,
maintenance, modification, alteration, reconstruction, restoration, or
replacement of the Property or the Lease,

                                     - 28 -
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or from the granting by Lessor at Lessee's request of easements, licenses or any
similar rights with respect to all or any part of the Property, or from the
construction, design, purchase or condition of the Property (including any
Claims (whether by Governmental Authority or other Person) arising, directly or
indirectly, out of the actual or alleged presence, use, storage, generation,
Release or threat of Release of any Hazardous Materials, and any Claims for
patent, trademark or copyright infringement and latent or other defects, whether
or not discoverable), including any liability under Applicable Laws (including,
without limitation, any Claims arising directly or indirectly out of any actual
or alleged violation, now or hereafter existing, of any Environmental Laws),
(ii) the Lease or any modification, amendment or supplement thereto to the
extent arising out of the operation, maintenance, use or possession of the
Property whether before or after the Closing Date, (iii) the non-compliance of
the Property with Applicable Laws (including because of the existence of the
Permitted Liens), (iv) without limiting any other indemnities herein, any other
matters relating to the Property or any operations thereon, and not already
covered by this Section 19.1(a), to the extent such matters arise out of the
operation, maintenance, use or possession of the Property by Lessee, whether
before or after the Closing Date, including matters relating to Environmental
Laws or Hazardous Materials, the breach by Lessee of its representations,
warranties, covenants and obligations in this Lease whether or not such Claim
arises or accrues prior to the date of this Lease, (v) the business and
activities of Lessee, except to the extent arising out of relationships not
related to this transaction, (vi) the cost of any Remedial Action, assessment,
containment, monitoring, treatment and/or removal of any and all Hazardous
Materials from all or any portion of the Property or any surrounding areas over
which Lessee has responsibility, the cost of any actions taken in response to a
release or threat of release of any Hazardous Materials on, in, under, relating
to or affecting any portion of the Property or any surrounding areas over which
Lessee has responsibility to prevent or minimize such release or threat of
release so that it does not migrate or otherwise cause or threaten danger to
present or future public health, safety, welfare or the environment, and costs
incurred to comply with Environmental Laws in connection with all or any portion
of the Property or any surrounding areas over which Lessee has responsibility,
(vii) a Lease Default or a Lease Event of Default, (viii) any litigation, suit,
cause of action, writ, decree, injunction, order, judgment, proceeding or Claim
now or hereafter asserted against the Property, Lessor (by virtue of its
ownership of, leasing or financing of the Property), or Lessee with respect to
the Property or this Lease, and (ix) any defects in title caused, created or
permitted by Lessee, or anyone acting by, through or under Lessee. Lessee
acknowledges that the foregoing includes any costs incurred by Lessor, or the
Lender in performing any inspections of any Property if such inspection reveals
a violation by Lessee of Section 8.5. Lessee shall not be required to indemnify
any Indemnitee under this Section 19.1 for any Claim to the extent resulting
from (A) the willful misconduct or negligence or breach of representation or
warranty of such Indemnitee or a member of such Indemnitee's Group, (B) any
amounts payable to Lender unless such amounts are payable by Lessee under this
Lease, (C) any acts or events to the extent first occurring after the expiration
of the Lease Term and return of the Property to Lessor in the condition required
in this Lease (but any indemnification first arising after the expiration of the
Term (and not otherwise covered hereby) shall include only those matters
relating to Lessee's failure to return the Property in the condition required),
(D) any taxes, except to the extent covered in Sections 8.6 of this Lease, (E)
any voluntary transfers of the Property made by Lessor (other than arising out
of a Lease Event of Default by Lessee), and (F) any voluntary transfer made by
the Lender. Lessee shall be entitled to credit against any payments due under
this

                                     - 29 -
<Page>

Section 19.1 any insurance recoveries or other reimbursements received by the
Indemnitee to be indemnified in respect of the related Claim under or from
insurance paid for, directly or indirectly, by Lessee or assigned to Lessor by
Lessee, to the extent such insurance recoveries exceed such Indemnitee's costs
and expenses incurred in recouping such insurance recovery.

     (b)  In case any Claim shall be made or brought against any Indemnitee,
such Indemnitees shall give prompt notice thereof to Lessee, PROVIDED that
failure to so notify Lessee shall not reduce Lessee's obligations to indemnify
any Indemnitee hereunder unless and only to the extent such failure results in
additional liability on Lessee's part. Lessee shall be entitled, at its expense,
acting through counsel selected by Lessee (and reasonably satisfactory to such
Indemnitee), to participate in, and, to the extent that Lessee desires, to
assume and control, the negotiation, litigation and/or settlement of any such
Claim (subject to the provisions of the last sentence of subparagraph (c) of
this Section 19.1). Such Indemnitee may (but shall not be obligated to)
participate in a reasonable manner at its own expense (unless Lessee is not
properly performing its obligations hereunder) and with its own counsel in any
proceeding conducted by Lessee in accordance with the foregoing. If Lessee shall
defend the Indemnitee in any such suit or proceeding, then, unless such
Indemnitee shall determine (in its reasonable discretion) that a conflict of
interest exists between Lessee and such Indemnitee, Lessee shall not be
obligated to reimburse the Indemnitee for the cost of such Indemnitee's
attorneys' fees or expenses incurred in connection with such suit or proceeding.

     (c)  Each Indemnitee shall at Lessee's expense supply Lessee with such
information and documents reasonably requested by Lessee in connection with any
Claim for which Lessee may be required to indemnify any Indemnitee under this
Section 19.1. Unless a Lease Event of Default is continuing, no Indemnitee shall
enter into any settlement or other compromise with respect to any Claim for
which indemnification is required under this Section 19.1 without the prior
written consent of Lessee. Lessee shall have the authority to settle or
compromise any Claim against an Indemnitee hereunder, PROVIDED that no admission
of wrongdoing shall be required of such Indemnitee and such Indemnitee shall be
released of all liability in connection with any such Claim.

     (d)  Upon payment in full of any Claim by Lessee pursuant to this Section
19.1 to or on behalf of an Indemnitee, Lessee, without any further action, shall
be subrogated to any and all claims that such Indemnitee may have relating
thereto, and such Indemnitee shall execute such instruments of assignment and
conveyance, evidence of claims and payment and such other documents,
instruments and agreements as may be necessary to preserve any such claims and
otherwise reasonably cooperate with Lessee to enable Lessee to pursue such
claims.

     (e)  Prior to paying any amount otherwise payable to an Indemnitee pursuant
to this Section 19.1, Lessee shall be entitled to receive from such Indemnitee
(i) a written statement describing the amount so payable, (ii) a general release
from Indemnitee upon such payment with respect to the claim made and (iii) such
additional information as Lessee may reasonably request and which is reasonably
available to such Indemnitee to properly substantiate the requested payment.

     (f)  Subject to the penultimate sentence of Section 19.1(a) above,
Lessee's liability hereunder shall in no way be limited or impaired by any act,
including, without limitation, (i) any

                                     - 30 -
<Page>

amendment or modification to the Lease, (ii) any waiver of any Lease Event of
Default, default, or extension of time or any failure to enforce any remedies or
rights of either Lessor or Lender, (iii) any sale or transfer of the Property,
or (iv) any assignment of the Lease.

                                   ARTICLE 20
                      LESSEE REPRESENTATIONS AND COVENANTS

     Section 20.1. REPRESENTATIONS AND WARRANTIES. Lessee represents and
warrants to Lessor that the following are true and correct as of the Closing
Date:

     (a)  DUE ORGANIZATION. Lessee is a corporation duly organized, validly
existing and in good standing in the State of New York and qualified to do
business in, and in good standing, in the State of Illinois. Lessee has the
corporate power and authority to conduct its business as now conducted, to lease
the Property and to enter into and perform its obligations under the Lease.
Lessee is duly qualified to do business and is in good standing as a foreign
corporation in any jurisdiction where the failure to so qualify would have a
material adverse effect on its ability to perform its obligations under the
Lease.

     (b)  DUE AUTHORIZATION; NO CONFLICT. The Lease has been duly authorized by
all necessary corporate action on the part of Lessee and has been duly executed
and delivered by Lessee, and the execution, delivery and performance thereof by
Lessee will not, (i) require any approval of the stockholders of Lessee or any
approval or consent of any trustee or holder of any indebtedness or obligation
of Lessee, other than such consents and approvals as have been obtained, (ii)
contravene any Applicable Law binding on Lessee or (iii) contravene or result in
any breach of or constitute any default under Lessee's charter or by-laws or
other organizational documents, or any indenture, judgment, order, mortgage,
loan agreement, contract, partnership or joint venture agreement, lease or other
agreement or instrument to which Lessee is a party or by which Lessee is bound,
or result in the creation of any Lien upon any of the property of Lessee.

     (c)  GOVERNMENTAL ACTIONS. All Governmental Action required in connection
with the execution, delivery and performance by Lessee of the Lease, has been or
will have been obtained, given or made.

     (d)  ENFORCEABILITY. The Lease constitutes the legal, valid and binding
obligation of Lessee, enforceable against Lessee in accordance with the terms
thereof, except as enforceability may be limited by bankruptcy, moratorium,
fraudulent conveyance, insolvency, equitable principles or other similar laws
affecting the enforcement of creditors' rights in general.

     (e)  BANKRUPTCY. No bankruptcy, reorganization, arrangement or insolvency
proceedings are pending, threatened or contemplated by Lessee, and Lessee has
not made a general assignment for the benefit of creditors.

     (f)  TAX FILINGS. All tax returns and reports of Lessee required by law to
be filed with respect to the Property have been duly filed, and all taxes,
interests and penalties assessed by any Governmental Authority upon the Property
or Lessee (with respect to the Property), which are due and payable, have been
paid, except to the extent being contested in good faith by the Lessee.

                                     - 31 -
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     (g)  CONDITION OF PROPERTY; CONDEMNATION. The Property is, to the Lessee's
knowledge, free and clear of any damage that would materially and adversely
affect its value. The Lessee has not received notice of any proceeding pending
for the total or partial condemnation of or affecting the Property, such that
such proceeding would have a material adverse effect on the Property. To the
Lessee's knowledge, as of the Closing Date, all of the material Improvements lie
wholly within the boundaries and building restriction lines of such Property,
except for encroachments that are insured against by the Title Policy or that do
not materially and adversely affect the value or marketability of the Property,
and no improvements on adjoining properties materially encroach upon the
Property so as to materially and adversely affect the value or marketability of
the Property.

     (h)  ENVIRONMENTAL CONDITIONS. An environmental site assessment was
performed with respect to the Property in connection with the closing, and a
report of each such assessment (an "ENVIRONMENTAL REPORT") has been delivered to
Lessor. To the Lessee's knowledge, there are no circumstances or conditions with
respect to the Property not revealed in such Environmental Report that render
the Property in violation (other than to a de minimis effect) of any applicable
Environmental Laws.

     (i)  LEGAL PROCEEDINGS. There are no pending or to the Lessee's knowledge,
threatened actions, suits or proceedings by or before any court or governmental
authority against or affecting the Lessee with respect to the Property that, if
determined adversely to such Lessee or Property, would materially and adversely
affect the value of the Property.

     (j)  LICENSES AND PERMITS. To the Lessee's knowledge, (i) it possesses all
material licenses, permits and authorizations required by applicable law for the
operation of the Property and (ii) all such licenses, permits and authorizations
are valid and in full force and effect.

The phrase "the Lessee's knowledge" and other words and phrases of like import
shall mean the actual state of knowledge of Dusty Dastur. Lessee represents that
the foregoing individuals are the people who are likely to know of any matters
covered by these representations and warranties.

                                   ARTICLE 21
                            [Intentionally Omitted]

                                   ARTICLE 22
                               PURCHASE PROCEDURE

     Section 22.1. PURCHASE PROCEDURE. In the event of the purchase of Lessor's
interest in the Property by Lessee pursuant to any provision of this Lease, the
terms and conditions of this Section 22.1 shall apply.

     (a)  On the closing date fixed for the purchase of Lessor's interest in the
Property, which shall be a Rent Payment Date:

          (i)      Lessee shall pay to Lessor, in lawful money of the United
     States, at Lessor's address hereinabove stated or at any other place in the
     United States which

                                     - 32 -
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     Lessor may designate, in immediately available funds, the applicable
     purchase price or Stipulated Loss Value, and all other costs due as of such
     Closing, including, without limitation, any applicable prepayment premium;
     and

          (ii)     Lessor shall execute and deliver to Lessee a deed with
     covenants against grantor's acts, assignment and/or such other instrument
     or instruments as may be appropriate, which shall transfer Lessor's
     interest in the Property, subject to, (A) Permitted Liens (except for any
     mortgage indebtedness of Lessor if the sale is pursuant to Article 12), (B)
     all liens, encumbrances, charges, exceptions and restrictions attaching to
     the Property after the Closing Date which shall not have been created or
     caused by Lessor (unless consented to by Lessee), and (C) all applicable
     laws, rules, regulations, ordinances and governmental restrictions then in
     effect.

     (b)  Lessee shall pay all costs, charges and expenses of incident to such
transfer, including, without limitation, all recording fees, transfer taxes,
title insurance premiums, fees for counsel to the Lender and federal, state and
local taxes, except for any net income taxes, if the sale is pursuant to Section
12.1, otherwise, such costs shall be as set forth in the Terms.

     (c)  In the event Lessor and Lessee enter into a purchase agreement for the
sale of the Property, Lessor agrees to cause the entity that owns the Property
to be sold to Lessee, in lieu of a sale of the Property to Lessee, in the event
(i) Lessee requests Lessor so to do; and (ii) the sale of the interests in
Lessor (rather than the Property) to Lessee shall not impose any obligations on
Lessor that would not be imposed had Lessor sold the property, will not decrease
any rights Lessor would have had Lessor sold the property, and will not create
any increased possibility of additional liability to Lessor (including without
limitation, for ongoing corporate acts, taxes, etc.), all as shall be reasonably
evidenced to Lessor by certificates, affidavits, opinions or otherwise. Lessor
agrees to cooperate with Lessee in effectuating such a transfer of equity
interests, subject to the terms hereof.

                                   ARTICLE 23
                         TRANSFER OF LESSOR'S INTEREST

     Section 23.1. PERMITTED TRANSFER. Subject to Article 4, Lessor may transfer
all, or any part of, its right, title and interest in and to any Property and
its rights under this Lease and the other documents relating thereto with
respect to such Property other than to Prohibited Transferees, on the following
terms and conditions, each of which shall be satisfied prior to the effective
date of the transfer (other than a transfer by a deed-in-lieu of foreclosure or
similar transfer made in connection with an exercise of remedies under the
Mortgage):

     (a)  such transfer shall be in compliance with the Mortgage and related
documents,(if still in place), and with Applicable Laws and shall not create a
relationship which would violate Applicable Laws;

     (b)  the transferor shall have given or at closing give to Lessee, notice
of such transfer, if of the entire Property, which notice shall contain such
information and evidence as shall be reasonably necessary to establish
compliance with this Article 23 and the name and address of the transferee for
notices.

                                     - 33 -
<Page>

     (c)  no transfer may be made of less than all of the legal parcels
comprising the Property.

     (d)  Lessor may not sell the Property, any interest therein, or permit the
sale or other transfer of any direct or indirect interest of Lessor, to any
Prohibited Transferee. Nothing herein shall, however be deemed a prohibition
against Lessor's indirect or direct member, beneficiary or affiliate (to the
extent such entities are REITs) selling shares of stock in such REIT.

     Section 23.2. EFFECTS OF TRANSFER. From and after any transfer effected in
accordance with this Article 23, the transferor shall be released, to the extent
of the interest transferred and the obligations assumed by the transferee, from
its liability hereunder and under the other documents to which it is a party
relating to the interests being transferred. Such release shall be in respect of
obligations (that are assumed by the transferee) arising on or after the date of
such transfer. Upon any transfer by Lessor of the Property as above provided,
any such transferee shall be deemed the "Lessor" for all purposes of such
documents and each reference herein to Lessor shall thereafter be deemed a
reference to such transferee for all purposes, except as provided in the
preceding sentence. Lessee agrees to execute any and all documents reasonably
appropriate to effectuate the contemplated transfer by Lessor, including,
without limitation, an amendment to this Lease providing that the new Lessor
shall be Lessor and the existing Lessor shall be released from its liabilities.

                                   ARTICLE 24
                               PERMITTED FINANCING

     Section 24.1. FINANCING DURING TERM.

     Lessee hereby expressly consents to the Lien imposed in favor of any first
mortgage indebtedness. With respect to any financing or refinancing during the
Base Term and during any Renewal Term, Lessor shall be free to encumber the
Property, PROVIDED that under no circumstances shall any such financing
adversely affect the rights and privileges of Lessee under this Lease in any
material respect, or increase in any material respect the nature, scope or
amount of any obligations or liabilities (including any contingent liabilities)
of Lessee in excess of those existing prior to any such further encumbrances by
Lessor. Lessee and its Affiliates will have no obligation to amend this Lease to
facilitate such financing; but shall execute and deliver a subordination and
attornment agreement to any lender to Lessor permitted by the above terms of
this Section 24.1 if such lender shall in turn deliver a nondisturbance
agreement to Lessee, in each case with terms reasonably acceptable to the
parties. Lessee agrees to cooperate with any refinancing by Lessor permitted
hereunder. Such cooperation shall include, without limitation, (i) naming such
new lender(s) as additional insureds; and (ii) making payments of Base Rent
and/or Supplemental Rent to or at the direction of such lender(s).

     Section 24.2. LESSEE'S CONSENT TO ASSIGNMENT FOR INDEBTEDNESS. Lessee
acknowledges that in order to secure Lessor's obligations to a Lender, Lessor
may agree, among other things, to the assignment (to the extent provided
therein) to the Lender of Lessor's right, title and interest to this Lease.
While the Mortgage or any replacements thereof are in effect, Lessee hereby:

     (a)  consents to such assignment in this Lease;

                                     - 34 -
<Page>

     (b)  covenants to make in full, in funds that are immediately available, to
Lender or its designee in accordance with the terms of this Lease:

          (i)    each payment of Base Rent and Supplemental Rent payable to
     Lessor (except under Article 19 hereof); and

          (ii)   all purchase prices, termination amounts, and other sums
     payable to Lessor under this Lease;

     (c) agrees:

          (i)    [Intentionally Omitted]

          (ii)   that (except as set forth in Section 12 with respect to
     Lessor's right to reject an offer and override the consent of the Lender)
     all consents, approvals, waivers and the like to be delivered by the Lessor
     pursuant to this Lease shall be given by Lessor and by the Lender, and no
     such consent, approval, waiver and the like delivered by Lessor shall be of
     any force or effect unless also delivered by the Lender;

          (iii)  to deliver to the Lender duplicate originals of all notices and
     other communications delivered to Lessor pursuant to this Lease, in
     accordance with this Lease, of (A) the occurrence of any Lease Event of
     Default, (B) the making of any election, and (C) the exercise of any right
     to terminate all or any portion of this Lease;

          (iv)   that it shall not, except as provided under Applicable Law,
     seek to recover from the Lender any moneys paid to the Lender by virtue of
     the foregoing provisions; PROVIDED, HOWEVER, that the foregoing provisions
     shall not limit Lessee's right to recover (A) any duplicate payment made to
     the Lender whether due to computational or administrative error or
     otherwise, if the Lender has received such payment, (B) all or any portion
     of a payment in excess of the amount then due under this Lease or otherwise
     owed by Lessor to Lessee under this Lease, and (C) any amounts that have
     been paid to or are actually held by the Lender that is required to be
     refunded to, repaid, or otherwise released to or for the benefit of Lessee
     under this Lease;

          (v)    that no payment of Rents (other than Excepted Payments) or
     delivery of such notices or other communications by Lessee shall be of any
     force or effect unless paid to Lender or delivered to the Lender as
     provided above;

          (vi)   that Lessee shall not pay any Rent more than thirty (30) days
     prior to such payment's scheduled due date except as provided in this
     Lease;

          (vii)  that Lessee shall not enter into any agreement subordinating or
     (except as expressly permitted by the terms of this Lease as in effect on
     the date hereof) surrendering, canceling, or terminating this Lease without
     the prior written consent of the Lender, and any such attempted
     subordination or termination without such consent shall be void;

                                     - 35 -
<Page>

          (viii) that Lessee shall not enter into any amendment or modification
     of this Lease without the prior written consent of the Lender, and any such
     attempted amendment or modification without such consent shall be void;

          (ix)   that if this Lease shall be amended, it shall continue to
     constitute collateral under the Mortgage without the necessity of any
     further act by Lessor, Lessee or the Lender; and

          (x)    that except as expressly provided in this Lease, Lessee shall
     not take any action to terminate, rescind or avoid this Lease,
     notwithstanding, to the fullest extent permitted by law, the bankruptcy,
     insolvency, reorganization, composition, readjustment, liquidation,
     dissolution or other proceeding affecting Lessor or any assignee of Lessor
     and notwithstanding any action with respect to the Lease which may be taken
     by an assignee, Lender or receiver of Lessor or of any such assignee or by
     any court in any such proceedings.

     Nothing herein shall be construed as Lessee's agreement to be bound and
perform the obligations of Lessor under any Mortgage or other debt documents. If
Lessee receives conflicting direction from Lessor and the Lender, or is in good
faith uncertain as to whether it should comply with a direction from either
Lessor or the Lender, Lessee shall be permitted to seek written confirmation
from Lessor and the Lender, or if the matter in dispute regards the payment of
money by Lessee, pay the same into a court and provide Lessor and the Lender
with reasonably prompt notice of such payment.

                                   ARTICLE 25
                                  MISCELLANEOUS

     Section 25.1. BINDING EFFECT; SUCCESSORS AND ASSIGNS; SURVIVAL. The terms
and provisions of this Lease, and the respective rights and obligations
hereunder of Lessor and Lessee, shall be binding upon their respective
successors, legal representatives and assigns (including, in the case of Lessor,
any Person to whom Lessor may transfer the Property) and inure to the benefit of
their respective permitted successors and assigns, and the rights hereunder of
the Lender shall inure (subject to such conditions as are contained herein) to
the benefit of its permitted successors and assigns.

     Section 25.2. QUIET ENJOYMENT. Lessee shall have the right to peaceably and
quietly hold, possess and use any and all of the Property hereunder during the
Lease Term, so long as no Lease Event of Default has occurred and is continuing.

     Section 25.3. NOTICES. Unless otherwise specifically provided herein, all
notices, consents, directions, approvals, instructions, requests and other
communications required or permitted by the terms hereof to be given to any
Person shall be in writing sent to either that Person's Address, and a copy
thereof shall be sent to each Person to receive a copy pursuant to the
definition of "Address", by (i) a prepaid nationally recognized overnight
courier service, and any such notice shall be deemed received one (1) Business
Day after delivery to a nationally recognized courier service specifying
overnight delivery, or (ii) U.S. certified or registered mail, return receipt
requested, postage prepaid, and such notice shall be deemed received when

                                     - 36 -
<Page>

actually received, as evidenced by the return receipt, or when delivery is first
refused. From time to time any party may designate a new Address for purposes of
notice hereunder by giving fifteen (15) days' written notice thereof to each of
the other parties hereto. All notices given hereunder shall be irrevocable
unless expressly specified otherwise. When sending notices to Lessor, Lessee
should refer to Section 24.3(c)(iii), above. Lessor shall endeavor to label any
envelope which contains a notice of default with the legend; "Default Notice,"
but its failure to do so shall not invalidate or affect in any way such notice.

     Section 25.4. SEVERABILITY. Any provision of this Lease that shall be
prohibited or unenforceable in any jurisdiction shall, as to such jurisdiction,
be ineffective to the extent of such prohibition or unenforceability without
invalidating the remaining provisions hereof and any such prohibition or
unenforceability in any jurisdiction shall not invalidate or render
unenforceable such provision in any other jurisdiction, and each party hereto
shall remain liable to perform its obligations hereunder except to the extent of
such unenforceability. To the extent permitted by applicable law, Lessee hereby
waives any provision of law that renders any provision hereof prohibited or
unenforceable in any respect.

     Section 25.5. AMENDMENTS, COMPLETE AGREEMENTS. Neither this Lease nor any
of the terms hereof may be terminated, amended, supplemented, waived or modified
orally, but may be terminated, amended, supplemented, waived or modified only by
an instrument in writing signed by the party against which the enforcement of
the termination, amendment, supplement, waiver or modification shall be sought
and, as required by the Mortgage or related documents, by the Lender. This Lease
is intended by the parties as a final expression of their lease agreement and as
a complete and exclusive statement of the terms thereof, all negotiations,
considerations and representations between the parties having been incorporated
herein. No representations, undertakings, or agreements have been made or relied
upon in the making of this Lease other than those specifically set forth herein.

     Section 25.6. HEADINGS. The Table of Contents and headings of the various
Articles and Sections of this Lease are for convenience of reference only and
shall not modify, define or limit any of the terms or provisions hereof.

     Section 25.7. COUNTERPARTS. This Lease may be executed by the parties
hereto in separate counterparts, each of which when so executed and delivered
shall be an original, but all such counterparts shall together constitute but
one and the same instrument

     Section 25.8. GOVERNING LAW. This Lease shall be governed by, and construed
in accordance with, the laws of the State in which the Property is situated.

     LESSOR AND LESSEE HEREBY SUBMIT TO NON-EXCLUSIVE PERSONAL JURISDICTION IN
THE STATE AND CITY OF NEW YORK AND THE FEDERAL COURTS OF THE UNITED STATES OF
AMERICA LOCATED IN THE STATE AND CITY OF NEW YORK (AND ANY APPELLATE COURTS
TAKING APPEALS THEREFROM) FOR THE ENFORCEMENT OF SUCH PERSON'S OBLIGATIONS
HEREUNDER AND WAIVES ANY AND ALL PERSONAL RIGHTS UNDER THE LAW OF ANY OTHER
STATE TO OBJECT TO JURISDICTION WITHIN SUCH STATE FOR THE PURPOSES OF SUCH
ACTION, SUIT, PROCEEDING OR LITIGATION TO ENFORCE SUCH

                                     - 37 -
<Page>

OBLIGATIONS OF LESSEE OR LESSOR. LESSOR AND LESSEE HEREBY WAIVE AND AGREE NOT TO
ASSERT, AS A DEFENSE IN ANY ACTION, SUIT OR PROCEEDING ARISING OUT OF OR
RELATING TO THIS LEASE (A) THAT IT IS NOT SUBJECT TO SUCH JURISDICTION OR THAT
SUCH ACTION, SUIT OR PROCEEDING MAY NOT BE BROUGHT OR IS NOT MAINTAINABLE IN
THOSE COURTS OR THAT IT IS EXEMPT OR IMMUNE FROM EXECUTION, (B) THAT THE ACTION,
SUIT OR PROCEEDING IS BROUGHT IN AN INCONVENIENT FORUM OR (C) THAT THE VENUE OF
THE ACTION, SUIT OR PROCEEDING IS IMPROPER. LESSEE AND LESSOR EACH HEREBY
EXPRESSLY WAIVES ANY AND ALL RIGHTS TO TRIAL BY JURY IN ANY ACTION OR PROCEEDING
RELATED TO THE ENFORCEMENT OF THIS LEASE.

     Section 25.9. MEMORANDUM. Lessee and lessor agree that a memorandum of this
Lease (and any amendment hereof) shall be executed and recorded, at Lessee's
expense, in the land records of the jurisdiction in which the Property is
situate.

     Section 25.10. ESTOPPEL CERTIFICATES. Each party hereto agrees that at any
time and from time to time during the Lease Term (but on no more than two
occasions during each Lease Year), it will promptly, but in no event later than
ten (10) days after request by the other party hereto, execute, acknowledge and
deliver to such other party a certificate in the form of Exhibit B attached
hereto. In addition, each party agrees to include in such certificate such other
items as may be reasonably requested under the circumstances giving rise to the
delivery of such certificate. Such certificate may be relied upon by any bona
fide, permitted purchaser of, or mortgagee with respect to, Lessor's or Lessee's
interest in the Property (direct or indirect), or any prospective sublessee of
Lessee in respect of all or a portion of the Property.

     Section 25.11. EASEMENTS. So long as no Lease Event of Default has occurred
and is then continuing, and provided that no such action could in either the
Lender's or Lessor's reasonable judgment be expected to have a material adverse
effect upon Lessee's ability to perform its obligations under the Lease, or on
the Fair Market Rental Value or Fair Market Sales Value of the Property, Lessor
will join with Lessee from time to time at the request of Lessee (and at
Lessee's sole cost and expense) to:

     (a)  subject to the terms of Article 12, sell, assign, convey or otherwise
transfer an interest in any or all of the Property to any Person legally
empowered to take such interest under the power of eminent domain, and dedicate
or transfer unimproved portions of any or all of the Property for road, highway
or other public purposes;

     (b)  upon approval by Lessor, which approval may not be unreasonably
withheld: (i) grant new (or release existing) easements, servitudes, licenses,
rights of way and other rights and privileges in the nature of easements, with
respect to the Property, and (ii) execute amendments to any covenants and
restrictions affecting the Property; and

     (c)  execute and deliver any instrument, in form and substance reasonably
acceptable to Lessor, necessary or appropriate to make or confirm the grants,
releases or other actions described above in Section 25.11(a) and Section 25.11
(b).

                                     - 38 -
<Page>

     Lessor agrees that it shall not grant any easements, licenses or other
possessory interests in the Property to any party without Lessee's prior written
consent, which shall not be unreasonably withheld or delayed, provided, however,
Lessee's consent shall not be required (i) during the continuation of a Lease
Event of Default, and (ii) to the extent such easement, license or other
possessory interest is required by law.

     Section 25.12. NO JOINT VENTURE. Any intention to create a joint venture or
partnership relation between Lessor and Lessee is hereby expressly disclaimed.

     Section 25.13. NO ACCORD AND SATISFACTION. The acceptance by Lessor of any
sums from Lessee (whether as Rent or otherwise) in amounts which are less than
the amounts due and payable by Lessee hereunder is not intended, nor shall be
construed, to constitute an accord and satisfaction, or compromise, of any
dispute between such parties regarding sums due and payable by Lessee hereunder,
unless Lessor specifically deems it as such in writing.

     Section 25.14. NO MERGER. In no event shall the leasehold interests,
estates or rights of Lessee hereunder, or of the Lender, merge with any
interests, estates or rights of Lessor in or to any and all of the Property, it
being understood that such leasehold interests, estates and rights of Lessee
hereunder, and of the Lender, shall be deemed to be separate and distinct from
Lessor's interests, estates and rights in or to the Property, notwithstanding
that any such interests, estates or rights shall at any time or times be held by
or vested in the same person, corporation or other entity.

     Section 25.15. LESSOR BANKRUPTCY. During the Lease Term the parties hereto
agree that if Lessee elects to remain in possession of any and all of the
Property after the rejection of the Lease by Lessor under Section 365(h) of the
Bankruptcy Code, all of the terms and provisions of this Lease shall be
effective during such period of possession by Lessee, including the Renewal
Terms and Lessee's purchase rights hereunder, even if Lessor becomes subject to
a case or proceeding under the Bankruptcy Code prior to the commencement of any
such Renewal Term or the exercise by Lessee of such purchase rights.

     Section 25.16. NAMING AND SIGNAGE OF THE PROPERTY. Lessee shall have the
sole and exclusive right, at any time and from time to time, to select the name
or names of the Property and the Improvements, and the sole and exclusive right
to determine not to use any name in connection with the Property, as well as all
rights in respect of signage for or in connection with the Property. Lessor
shall not have or acquire any right or interest with respect to any such name or
names used at any time by Lessee, or any trade name, trademark service mark or
other intellectual property of any type of Lessee. Lessor shall cooperate with
Lessee to effectuate Lessee's sign rights hereunder, at no cost to Lessor.
Lessee may install any sign or signs on the Property as it elects, at its sole
cost and in compliance with Applicable Laws. Any signs installed by Lessee
(other than those existing as of the Commencement of the Term) shall be removed
by Lessee at the expiration or earlier termination of the Term, and Lessee shall
repair any damage caused by such removal.

     Section 25.17. EXPENSES. Whenever this Lease provides for the reimbursement
by Lessee of costs and expenses of Lessor or any other party, then such
reimbursement obligation shall be limited to actual, out-of pocket third-party
costs and expenses including, but not limited

                                     - 39 -
<Page>

to, reasonable attorneys' fees. In addition to any other costs payable hereunder
by Lessee, Lessee acknowledges and agrees that whenever (i) it seeks Lessor's
consent to an Alteration, (ii) it makes a rejectable offer, (iii) Fair Market
Sales Value, Fair Market Rental Value or Base Rent during a Renewal Term need to
be calculated, (iv) Lessee assigns its lease, (v) Lessor is asked to sign a
landlord waiver with respect to Lessee's personal property, or (vi) a casualty
or condemnation (including, without limitation, an Event of Loss) occurs, Lessee
shall pay all reasonable costs incurred by Lessor, and Lender arising out of the
foregoing.

     Section 25.18. INVESTMENTS. Any moneys held by Lessor (or by the Lender or
Proceeds Trustee) pursuant to this Lease, including Section 12.4, shall, until
paid to Lessee, be Invested by Lessor or the Proceeds Trustee, or by the Lender
(if there is one), in Permitted Investments as directed by or on behalf of
Lessee. Any gain (including interest received) realized as a result of any such
investment shall be retained with, and distributed and re-invested in the same
manner, as the original principal amount. Lessor (and the Lender) shall have no
liability for any losses arising from any such investments or reinvestments. At
such time as there no longer exists a requirement under this Lease for the
Proceeds Trustee to hold such amounts, such amounts, together with any income
thereon, shall be disbursed to Lessee.

     Section 25.19. FURTHER ASSURANCES. Lessor and Lessee, at the cost and
expense of the requesting party (except as otherwise set forth in this Lease to
the contrary), will cause to be promptly and duly taken, executed, acknowledged
and delivered all such further acts, documents and assurances as any of the
others reasonably may request from time to time in order to carry out more
effectively the intent and purposes of this Lease. Nothing herein shall obligate
Lessee to provide to Lessor or the Lender any proprietary or confidential
information relating to the manner, method and procedures of Lessee's business
operations, or relating to Lessee's business plan. Lessee also agrees to
cooperate with Lessor in determining how to allocate the purchase price paid for
the property for purposes of depreciation, including review of the applicable
portions of Lessee's books applicable to Lessee's depreciation of the Property,
as prior owner and as Lessee.

     Section 25.20. [Intentionally omitted]

     Section 25.21. INDEPENDENT COVENANTS. The covenants of Lessor and Lessee
herein are independent and several covenants and not dependent on the
performance of any other covenant in this Lease.

     Section 25.22. LESSOR EXCULPATION. Anything to the contrary in this Lease
notwithstanding, the covenants contained in this Lease to be performed by Lessor
shall not be binding on any member of Lessor in its or his or her individual
capacity, but instead said covenants are made for the purpose of binding only
all of Lessor's right, title and interest in and to the Property, and none of
Lessor or any of its Affiliate or any of its successors and assigns shall have
any liability under this Lease in excess of, and Lessee shall have no recourse
under this Lease against Lessor or any Affiliate of it except for Lessor's
interest (to the extent not pledged or assigned), the Property, Net Proceeds and
Rent.

     Section 25.23. REMEDIES CUMULATIVE. To the extent permitted by, and subject
to the mandatory requirements of, Applicable Laws, each and every right, power
and remedy herein

                                     - 40 -
<Page>

specifically given to the Lessor or otherwise in this Lease shall be cumulative
and shall be in addition to every other right, power and remedy herein
specifically given or now or hereafter existing at law, in equity or by
statute, and each and every right, power and remedy whether specifically herein
given or otherwise existing may be exercised from time to time and as often and
in such order as may be deemed expedient by Lessor. No delay or omission by
Lessor in the exercise of any right, power or remedy or in the pursuit of any
remedy shall impair any such right, power or remedy or be construed to be a
waiver or any default on the part of Lessee or to be an acquiescence therein.
Lessor's consent to any request made by Lessee shall not be deemed to
constitute or preclude the necessity for obtaining Lessor's consent, in the
future, to all similar requests. No waiver by Lessor of any default shall in
any way be, or be construed to be, a waiver of any future or subsequent
default.

     Section 25.24. HOLDING OVER. Subject to Section 12.1 and the last sentence
of Section 10.l(b) Lessee covenants that if for any reason Lessee or any
subtenant of Lessee shall fail to vacate and surrender possession of a Property
or any part thereof, in the condition required herein, on or before the
expiration or earlier termination of this Lease and the Term, then Lessee's
continued possession of the Property shall be as a tenant at sufferance, during
which time, without prejudice and in addition to any other rights and remedies
Lessor may have hereunder or at law, Lessee shall pay to Lessor an amount equal
to: (a) one hundred twenty-five percent (125%) of the total monthly amount of
Rent payable hereunder immediately prior to such termination (the "EXISTING
RENT") for the first ninety (90) days during which Lessee holds over, and (b)
one hundred fifty percent (150%) of the Existing Rent thereafter. The provisions
of this Section shall not in any way be deemed to (i) permit Lessee to remain in
possession of the Property after the expiration date or sooner termination of
this Lease, or (ii) imply any right of Lessee to use or occupy the Property upon
expiration or termination of this Lease and the Term and no acceptance by Lessor
of payments from Lessee after the expiration date or sooner termination of the
Term shall be deemed to be other than on account of the amount to be paid by
Lessee in accordance with the provisions of this Section. Lessee's obligations
under this Section shall survive the expiration or earlier termination of this
Lease.

     Section 25.25. SURVIVAL. The following provisions shall survive the
termination of this Lease: (i) Sections 3.5, 6.1, 8.4, 8.5, 8.6 (only with
respect to Impositions arising during the Term) 8.7, 8.8, 17.2, 22.1, Articles
7, 10, 19 and 25 to the extent relating to unfulfilled obligations of Lessee
arising or occurring prior to the date of termination of this Lease, and (ii)
any provision of this Lease pursuant to which the Lessor or Lessee had an
existing obligation which was unsatisfied at the time of termination of this
Lease and remains unsatisfied, including, without limitation, to the extent
there was any unsatisfied obligation under, Sections 12.1, and Article 3,
PROVIDED, HOWEVER, that nothing in this Section 25.25 shall be deemed to extend
any applicable statute of limitations.

     Section 25.26. [Intentionally Omitted]

     Section 25.27. LEASE SUBORDINATE. This Lease, the leasehold estate of
Lessee created hereby and all rights of Lessee hereunder are and shall be
subject and subordinate to the Mortgage and to all renewals, modifications,
consolidations, replacements and extensions of the Mortgage, subject to the
parties executing a commercially reasonable subordination, non-disturbance and
attornment agreement. Such agreement shall provide that, so long as no Lease

                                     - 41 -
<Page>

Event of Default has occurred or is occurring, Lessee's occupancy and use of
the Property pursuant to the terms of this Lease shall not be disturbed and
Lessee's rights under this Lease are and shall always be subordinate to the
Mortgage and to all renewals, modification, consolidation, replacements and
extension of the Mortgage.

     Section 25.28. LESSOR REPRESENTATION. The Lease has been duly authorized by
all necessary action on the part of Lessor and has been duly executed and
delivered by Lessor, and the execution, delivery and performance thereof by
Lessor will not, (i) require any consent or approval of any Person, other than
such consents and approvals as have been obtained, (ii) contravene any
Applicable Law binding on Lessor or the organizational documents of Lessor or
(iii) contravene or result in any breach of or constitute any default under
Lessor's organizational documents, or any indenture, mortgage, loan agreement,
contract, partnership or joint venture agreement, lease or other agreement or
instrument to which Lessor is a party or by which Lessor is bound.

                                     - 42 -
<Page>

          IN WITNESS WHEREOF, Lessor and Lessee have duly authorized, executed
and delivered this Lease as of the date first hereinabove set forth.

                             LESSOR:

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

                             By:
                                  -------------------------------------

                             By:
                                  -------------------------------------

                             By:
                                  -------------------------------------

                             By:
                                  -------------------------------------

                             LESSEE:

                             ZURICH AMERICAN INSURANCE COMPANY,
                                  a New York corporation

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

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

                                     - 43 -
<Page>

                                                                      APPENDIX A

                                  [Definitions]

Unless otherwise specified or the context otherwise requires:

(a)  any term defined below by reference to another instrument or document shall
continue to have the meaning ascribed thereto whether or not such other
instrument or document remains in effect;

(b)  words which include a number of constituent parts, things or elements,
shall be construed as referring separately to each constituent part, thing or
element thereof, as well as to all of such constituent parts, things or elements
as a whole;

(c)  references to any Person include such Person's successors and assigns and
in the case of an individual, the word "successors" includes such Person's
heirs, devisees, legatees, executors, administrators and personal
representatives;

(d)  words importing the singular include the plural and vice versa;

(e)  words importing a gender include any gender;

(f)  the words "consent", "approve", "agree" and "request", and derivations
thereof or words of similar import, mean the prior written consent, approval,
agreement or request of the Person in question;

(g)  a reference to a part, clause, party, section, article, exhibit or schedule
is a reference to a part and clause of, and a party, section, article, exhibit
and schedule to, such Operative Document;

(h)  a reference to any statute, regulation, proclamation, ordinance or law
includes all statutes, regulations, proclamations, ordinances or laws varying,
consolidating or replacing them, and a reference to a statute includes all
regulations, proclamations and ordinances issued or otherwise applicable under
that statute;

(i)  a reference to a document includes an amendment or supplement to, or
replacement or novation of, that document;

(j)  a reference to a party to a document includes that parry's successors and
permitted delegees and/or assigns,

(k)  the words "including" and "includes," and words of similar import, shall be
deemed to be followed by the phrase "without limitation";

(1)  the words "hereof and "hereunder," and words of similar import, shall be
deemed to refer to the Lease as a whole and not to the specific section or
provision where such word appears;

                                       A-1
<Page>

(m)  unless the context shall otherwise require, a reference to the "Property"
or "Improvements" shall be deemed to be followed by the phrase "or a portion
thereof;

(n)  the Schedules and Exhibits of the Lease are incorporated herein by
reference;

(o)  the titles and headings of Articles, Sections, Schedules, Exhibits,
subsections, paragraphs and clauses are inserted as a matter of convenience and
shall not affect the construction of the Lease;

(p)  all obligations of the Lessor under the Mortgage and any related documents
shall be satisfied by the Lessor at Lessor's sole cost and expense;

     "ACTUAL KNOWLEDGE" with respect to any Person, shall mean the present,
conscious, actual knowledge of, or receipt of notice by, (i) senior officers of
such Person or the officers or employees of such Person charged with the
oversight on its behalf of the Overall Transaction or (ii) with respect to a
matter covered by a representation and warranty, the property or asset manager
having responsibility for the matters covered by such representation and the
person to whom such manager reports. Actual Knowledge of Lessee as of the
Closing Date shall be as set forth in Section 20.1 of the Lease with respect to
the matters represented in the Lease as of the Closing Date.

     "ADDITIONAL RENEWAL TERM" shall have the meaning specified in Section 5.1
of the Lease.

     "ADDRESS" shall mean, subject to the rights of the party in question to
change its Address in accordance with the terms of the Lease:

(i)  with respect to Lessee: Zurich American Insurance Company
                             1400 East American Lane
                             Schaumburg, Illinois 60196-1056

                             Attention: T1-19 Treasury

     with a copy to:         Zurich American Insurance Company
                             1400 East American Lane
                             Schaumburg, Illinois 60196-1056
                             Attention: T1-20 Corporate Law

     with a copy to:         Kramer Levin Naftalis & Frankel LLP
                             919 Third Avenue
                             New York, NY 10022
                             Attention: Neil R. Tucker

                                       A-2
<Page>

(ii) with respect to Lessor:
                             ---------------------------------

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

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

     with a copy to:
                             ---------------------------------

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

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

     "AFFECTED PROPERTY" shall have the meaning specified in Section 12.1 of the
Lease.

     "AFFILIATE" of any Person shall mean any other Person directly or
indirectly controlling, controlled by or under common control with, such person
and shall include, if such Person is an individual, members of the Family of
such Person and trusts for the benefit of such individual or Family members. For
purposes of this definition, the term, "CONTROL" (including the correlative
meanings of the terms "CONTROLLING" "CONTROLLED BY" AND "UNDER COMMON CONTROL
WITH"), as used with respect to any Person, shall mean the possession, directly
or indirectly, of the power to direct or cause the direction of the management
policies of such Person, whether through the ownership of voting securities or
by contract or otherwise.

     "ALTERATIONS" shall mean alterations, improvements, installations,
demolitions, modifications, changes and additions to the Property, but shall not
include Lessee's Equipment and Personalty.

     "APPLICABLE LAWS" shall mean (i) all existing and future applicable laws
(including common laws), rules, regulations, statutes, treaties, codes,
ordinances, permits, certificates, orders and licenses of and interpretations
by, any Governmental Authorities, and applicable judgments, decrees,
injunctions, writs, orders or like action of any court, arbitrator or other
administrative, judicial or quasi-judicial tribunal or agency of competent
jurisdiction (including those pertaining to the environment and those pertaining
to the construction, use or occupancy of the Property), and (ii) any reciprocal
easement agreement, covenant, other agreement or deed restriction or easement of
record affecting the Property as of the date hereof or subsequent hereto
pursuant to the terms of the Lease (but excluding for purposes of this
definition The Mortgage and related debt documents). Applicable Laws include
Environmental Laws.

     "APPRAISAL PROCEDURE" shall mean the following procedure for determining
any one or more of the Fair Market Sales Value of the Property, the Fair Market
Rental Value of the Property or any other amount which may, pursuant to any
provision of any Operative Document, be determined by the Appraisal Procedure:
one Qualified Appraiser shall be chosen by the Lessor and one Qualified
Appraiser shall be chosen by Lessee. If the Lessee or Lessor fails to choose a
Qualified Appraiser within twenty (20) Business Days after written notice from
the

                                       A-3
<Page>

other party of the selection of its Qualified Appraiser followed by a second
notice (which notice shall specifically state that failure to select a Qualified
Appraiser within ten (10) Business Days shall prohibit appointment of a
Qualified Appraiser by the addressed party) given at least ten (10) Business
Days prior to the expiration of such twenty-day period, then the appraisal by
such appointed Qualified Appraiser shall be binding on the parties. If the two
Qualified Appraisers cannot agree on a value within twenty (20) Business Days
after the appointment of the Second Qualified Appraiser, then a third Qualified
Appraiser shall be selected by the two Qualified Appraisers or, failing
agreement as to such third Qualified Appraiser within thirty (30) Business Days
after the appointment of the Second Qualified Appraiser, by the American
Arbitration Association office in Chicago, Illinois. The Appraisals of the three
Qualified Appraisers shall be given within twenty (20) Business Days of the
appointment of the third Qualified Appraiser and the Appraisal of the Qualified
Appraiser most different from the average of the other two shall be discarded
and such average of the remaining two Appraisers shall be binding on the
parties; provided that if the highest appraisal and the lowest appraisal are
equidistant from the third appraisal, the third appraisal shall be binding on
the parties. The fees and expenses of the Qualified Appraiser appointed by a
party shall be paid by such party (such fees and expenses not being
indemnifiable by Lessee); the fees and expenses of the third Qualified Appraiser
shall be divided equally between the two parties, except that all fees and
expenses of all the Qualified Appraisers shall be paid by Lessee in the case of
an appraisal or determination under Article 17 of the Lease.

     "APPROVED ENVIRONMENTAL CONSULTANT" shall mean any environmental consultant
to Lessee of national standing and reasonably approved by Lessor and Lender.

     "AUTHORIZED OFFICER" shall mean with respect to a Person if the Person is
not an individual, any officer or principal of the Person, any trustee of the
Person (if the Person is a trust), any general partner or joint venturer of the
Person (if the Person is a partnership or joint venture) or any manager or
member that is a manager of the Person (if the Person is a limited liability
company) who shall be duly authorized to execute the Lease.

     "BANKRUPTCY CODE" shall mean the Bankruptcy Reform Act of 1978 as amended
and as may be further amended.

     "BASE RENT" shall mean, for the Base Term, the rent payable pursuant to
Section 3.1 of the Lease and, for any Renewal Term, the rent payable pursuant to
Article 5 of the Lease as such amounts may be adjusted from time to time.

     "BASE TERM" shall mean the period commencing on the Closing Date and ending
on November 30, 2016, or such shorter period as may result from earlier
termination of the Lease as provided therein.

     "BOARD OF DIRECTORS", with respect to a corporation, means either the Board
of Directors or any duly authorized committee of that Board which pursuant to
the by-laws of such corporation has the same authority as that Board as to the
matter at issue.

     "BUSINESS DAY" shall mean any day other than a Saturday, Sunday or other
day on which banks are authorized to be closed in the State of New York or the
State of Illinois.

                                       A-4
<Page>

     "CASUALTY" shall mean any damage or destruction caused to the Property by
any reason, whether or not constituting an Event of Loss.

     "CLAIMS" shall mean Liens (including, without limitation, lien removal and
bonding costs) liabilities, obligations, damages, losses, demands, penalties,
assessments, payments, fines, claims, actions, suits, judgments, settlements,
costs, expenses and disbursements (including, without limitation, reasonable,
actually-incurred legal fees and expenses and costs of investigation and
Remedial Action) of any kind and nature whatsoever.

     "CLOSING DATE" shall mean November 30, 2004.

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

     "CONDEMNATION" shall mean any condemnation, requisition or other taking or
sale of the use, occupancy or title to any or all of the Property, by or on
account of any eminent domain proceeding or other action by any Governmental
Authority or other Person under the power of eminent domain or otherwise or any
transfer in lieu of or in anticipation thereof.

     "CPI" shall mean the national Consumer Price Index, for all urban consumers
(1982-84=100), all items, all cities, as published by the Bureau of Labor
Statistics.

     "CPI INCREASE", when used with respect to a stated dollar amount as of a
given date, shall mean that the stated dollar amount shall be increased by a
percentage equal to the percentage increase, if any, in the CPI from the Closing
Date (or the anniversary thereof, as applicable) to such date.

     "DEFAULT RATE" shall mean three percent (3%) above the annual rate of
interest set by Citibank, N.A. (or any successor thereto) as its "PRIME RATE"
from time to time.

     "ENVIRONMENTAL LAWS" shall mean all federal, state or local laws,
ordinances, rules, orders, statutes, decrees, judgments, injunctions, codes,
regulations and common law (a) relating to the environment, human health or
natural resources; (b) regulating, controlling or imposing liability or
standards of conduct concerning Hazardous Materials; (c) relating to the
remediation of the mortgaged property, including investigation, response,
clean-up, remediation, prevention, mitigation or removal of Hazardous Materials;
or (d) requiring notification or disclosure of releases of Hazardous Materials
or any other environmental conditions on the mortgaged property, as any of the
foregoing may have been or may be amended, supplemented or supplanted from time
to time, including the Resource Conservation and Recovery Act of 1976 ("RCRA"),
42 U.S.C. Sections 6901 et seq., as amended by the Hazardous and Solid Waste
Amendments of 1984, the Comprehensive Environmental Response, Compensation and
Liability Act, as amended by the Superfund Amendments and Reauthorization Act of
1986, 42 U.S.C. Sections 9601 et seq. ("CERCLA"), the Hazardous Materials
Transportation Act of 1975,49 U.S.C. Sections 1801-1812, the Toxic Substances
Control Act, 15 U.S.C. Sections 2601-2671, the Clean Air Act, 42 U.S.C. Sections
7041 et seq., the Federal Insecticide, Fungicide and Rodenticide Act, 7 U.S.C.
Sections 136 et seq., as any of the foregoing may have been or may be amended,
supplemented or supplanted from time to time.

                                       A-5
<Page>

     "ENVIRONMENTAL REPORTS" shall mean the report and information covering the
Property prepared by URS Corporation.

     "ERISA" shall mean the Employee Retirement Income Security Act of 1974.]

     "EVENT OF LOSS" shall mean (y) the damage, by fire or otherwise, and
whether total or partial, that (A) the Lessee in its reasonable discretion shall
determine that as a result of such damage the Property is no longer useful for
its intended purpose, and (B) the cost of repair or restoration would exceed
twenty-five percent (25%) of the Property Cost for the Property or (z) the
permanent or material taking by Condemnation effecting (A) title to all or
substantially all of the Property, or (B) the principal points of ingress or
egress of the Property to public roadways, or (C) such a material part of the
Land or the Improvement so as to have a material and adverse effect on the
business of the Lessee as conducted from the Property. Any decision regarding
whether the Property is no longer useful for its intended purpose shall be made
by Lessee in good faith and evidenced by an Officer's Certificate of Lessee
delivered to Lessor and the Lender.

     "EXCEPTED PAYMENTS" shall mean and include (i) the amount by which Base
Rent exceeds all amounts then due and payable under any debt documents, any
amount payable to Lessor as a reimbursement for losses suffered by Lessor
pursuant to Section 12.1 above and any other amounts payable directly to Lessor
under Article 18 or 19 as set forth in the Lease, (ii) proceeds of public
liability or property damage insurance maintained under the Lease solely for the
benefit of any Person other than the Lender, and (iii) any payment required
under the Lease to be made directly by Lessee to a third party such as taxes,
utility charges, ground rent, if any, and similar payments.

     "EXCEPTED RIGHTS" shall mean (i) all rights with respect to Excepted
Payments of the Person entitled thereto and (ii) all rights and privileges
expressly reserved to the Lessor pursuant to any debt documents.

     "EXISTING RENT" shall have the meaning specified in Section 25.24 of the
Lease.

     "FAIR MARKET RENTAL VALUE" with respect to any Property shall mean the fair
market monthly rental value that would be obtained in an arm's-length
transaction between an informed and willing lessee and an informed and willing
lessor, in either case under no compulsion to lease, and neither of which is
related to Lessor or Lessee, for the lease of such Property on the terms set
forth in the Lease, and taking into consideration the fact that no brokerage
commission will be payable, and that Lessee will not be receiving any tenant
improvement allowance, period of free rent, or other economic concession. Such
fair market rental value shall be calculated as the value for the use of such
Property assuming that such Property is in the condition and repair required to
be maintained by the terms of the Lease, including, without limitation, in
compliance with all Applicable Laws and assuming no Hazardous Materials present
in, on, under or about the Property.

     "FAIR MARKET SALES VALUE" with respect to any Property shall mean the fair
market sales value that would be obtained in an arm's-length transaction between
an informed and willing buyer and an informed and willing seller, under no
compulsion, respectively, to buy or sell, and

                                       A-6
<Page>

neither of which is related to Lessor or Lessee, for the purchase of the
Property. Such Fair Market Sales Value shall be calculated as the value for such
Property using the same methodology as used in the appraisal delivered on or
before the Closing Date and assuming that the Property is in the condition and
repair required to be maintained by the terms of the Lease, including, without
limitation, in compliance with all Applicable Laws and assuming no Hazardous
Materials present in, on, under or about the Property.

     "FAMILY" shall mean, as to any Person, such Person's grandparents, all
lineal descendants of such Person's grandparents, Persons adopted by, or
stepchildren of, any such grandparent or descendant and Persons currently
married to, or who are widows or widowers of, any such grandparent, descendant,
adoptee or stepchild.

     "FINAL PAYMENT DATE" shall have the meaning specified in Section 17.1(e) of
the Lease.

     "FIRST REFUSAL NOTICE" shall have the meaning specified in Section 4.1 of
the Lease.

     "FIXTURES" shall have the meaning specified in the term "Property".

     "GAAP" shall mean generally accepted accounting principles in the United
States, as in effect from time to time, consistently applied.

     "GOVERNMENTAL ACTION" shall mean all permits, authorizations,
registrations, consents, approvals, waivers, exceptions, variances, orders,
judgments, decrees, licenses, exemptions, publications, filings, notices to and
declarations of or with, or required by, any Governmental Authority, or required
by any Applicable Laws, and shall include, without limitation, all citings,
environmental and operating permits and licenses that are required for the use,
occupancy, zoning and operation of the Property.

     "GOVERNMENTAL AUTHORITY" shall mean any federal, state, county, municipal
or other governmental or regulatory authority, agency, board, body, commission,
instrumentality, court or quasi governmental authority (or private entity in
lieu thereof).

     "HAZARDOUS MATERIAL" shall mean any substance (whether solid, liquid or
gas), pollutant, contaminant, waste or material (including those that are toxic,
explosive, corrosive, flammable, infectious, radioactive, carcinogenic,
mutagenic or otherwise hazardous or considered pollutants including petroleum,
its derivatives, by-products and other hydrocarbons and asbestos), in each case
that is or becomes regulated by any Governmental Authority, including any
agency, department, commission, board or instrumentality of the United States
and/or each State in which the Property is situated, or that may form the basis
of liability under any Environmental Law.

     "IMPOSITIONS" shall mean, collectively, all real estate taxes on the
Property, all ad valorem, sales and use, gross receipts, transaction privilege,
rent or similar taxes levied or incurred with respect to the Property, or the
use, lease, ownership or operation thereof, personal property tax on any
property covered by the Lease that is classified by government authorities as
personal property, assessments (including all assessments for public
improvements or benefits, whether or not commenced or completed within the Lease
Term), water, sewer, utilities or other rents and charges, excises, levies, fees
and all other governmental charges of any kind or nature

                                       A-7
<Page>

whatsoever, general or special, foreseen or unforeseen, ordinary or
extraordinary, with respect to the Property or any part thereof and/or the Rent,
including all interest and penalties thereon, which at any time prior to, during
or with respect to the Lease Term may be assessed or imposed on or with respect
to or be a Lien upon Lessor or the Property or any part thereof or any rent
therefrom or any estate, title or interest therein. Impositions shall exclude,
however, and nothing contained in the Lease or any debt documents or related
Mortgage shall be construed to require Lessee to pay, (i) any tax imposed on
Lessor, or the Lender based on the net income of Lessor, or the Lender or any
transfer tax imposed on Lessor, the Lender or any other Person, except to the
extent that any tax described in this clause (i) is levied, assessed or imposed
as a total or partial substitute for a tax, assessment, levy or charge upon the
Property, the Rent or any part thereof or interest therein which Lessee would
otherwise be required to pay thereunder; (ii) any tax imposed with respect to
the sale, exchange or other disposition by (A) Lessor of the Property or (B) the
Lender of its debt; or (iii) any gross receipts, transaction privilege, rent or
similar tax, assessment, levy or charge upon Lessor, the Property, the Rent or
any part of any thereof or interest therein, but solely to the extent that the
same is levied, assessed or imposed as a total or partial substitute for a tax,
assessment, levy or charge described in clause (i) or clause (ii) which Lessee
would otherwise not be required to pay hereunder.

     "IMPROVEMENTS" shall have the meaning specified in the term "PROPERTY".

     "INDEMNITEE" shall mean the Lessor, its member, the Lender, any trustee
under a Mortgage which is a deed of trust, and each of their Affiliates and
their respective officers, directors, employees, shareholders, members or
partners.

     "INDEMNITEE'S GROUP" shall mean, with respect to a particular Indemnitee,
such Indemnitee (including its Affiliates and their respective officers,
directors, employees, agents, shareholders, trustees, members or partners) and
their successors and assigns.

     "INSPECTING PARTIES" shall have the meaning specified in Article 15 of the
Lease.

     "INTENT TO RENEW DATE" shall have the meaning specified in Section
5.1(b)(i) of the Lease.

     "LAND" shall have the meaning specified in the term "Property".

     "LEASE" shall mean the Lease Agreement dated as of the Closing Date between
Lessor, as lessor, and Lessee, as lessee.

     "LEASE DEFAULT" shall mean any event, condition or failure which, with
notice or lapse of time or both, would become a Lease Event of Default.

     "LEASE EVENT OF DEFAULT" shall have the meaning specified in Article 16 of
the Lease.

     "LEASE TERM" shall mean the full term of the Lease, including the Base Term
and any Renewal Terms as to which Lessee exercises a renewal option pursuant to
Article 5 of the Lease, or such shorter period as may result from earlier
termination of the Lease as provided therein.

                                       A-8
<Page>

     "LEASE YEAR" shall mean each consecutive period of twelve (12) full
calendar months occurring after the Closing Date, provided, however, that, if
the Closing Date shall not be the first day of a month, then the first Lease
Year shall also include the partial month in which the Closing Date occurs.

     "LENDER" shall mean, from time to time, the holder of the first lien
Mortgage on the Property. During periods when there is no Lender, references
herein to Lender shall have no force or effect.

     "LESSEE" shall mean the Lessee named in the Lease to which this Appendix is
attached.

     "LESSEE'S EQUIPMENT AND PERSONALTY" shall mean all furniture, equipment and
personal property of Lessee, which includes, without limitation, inventory,
racking, shelving, conveyer equipment, lifts, cabling, antennae, machinery, air
compressors, battery chargers, communication equipment, data cabinets, automated
teller machines, hoist equipment, lockers, plug-in light fixtures, propane
tanks, storage racks, trash compactors, signs, desks, movable partitions,
vending machines, computer software and hardware, movable storage and utility
rooms and removable trade fixtures and equipment, even if bolted or otherwise
affixed to the floors, including, without limitation, telecommunication
switches, in each case, as now or may hereafter exist in or on any of the
Improvements and any other personal property owned by Lessee or a sublessee of
Lessee or other occupant of the Property. In no case shall Lessee's Equipment
and Personalty include fixtures or built-in heating, ventilating,
air-conditioning, and electrical equipment (including power panels) to be
utilized in connection with the operation of the Property.

     "LESSOR" shall mean the Lessor named in the Lease to which this Appendix is
attached.

     "LESSOR LIENS" shall mean Liens on or against the Property or the Lease or
any payment of Rent (a) which result from any act of, or any Claim against,
Lessor, or which result from any violation by Lessor of any of the terms of the
Mortgage or any related debt documents, other than a violation due to a default
by Lessee under the Lease, (b) which result from Liens in favor of any taxing
authority by reason of any Tax owed and payable by Lessor, except that Lessor
Liens shall not include any Lien resulting from any Tax for which Lessee is
obligated to indemnify Lessor until such time as Lessee shall have already paid
to or on behalf of Lessor the Tax or the required indemnity with respect to the
same, or (c) which result from any expenses owed, caused or occasioned by Lessor
or any of its employees or agents which are not indemnified by Lessee pursuant
to Section 19.1 of the Lease, but shall exclude Permitted Liens and any Liens
created by the Mortgage and any other debt documents, except to the extent any
such Lien arises by the Lender's payment of any of the foregoing.

     "LIEN" shall mean any lien, mortgage, pledge, charge, security interest or
encumbrance of any kind, or any other type of preferential arrangement that has
the practical effect of creating a security interest, including, without
limitation, any thereof arising under any conditional sale agreement, capital
lease or other title retention agreement.

     "MATERIAL" as used to describe Lessee's compliance requirement in Section
8.5 of the Lease shall mean that the failure to so comply may reasonably be
expected to result in material

                                       A-9
<Page>

risk of (i) physical injury or illness to any individual, (ii) criminal
liability, or (iii) fines or Remedial Action or compliance costs in excess of
$500,000.00 (which shall be adjusted upward each January 1 by any CPI Increase).

     "MOODY'S" shall mean Moody's Investors Service, Inc. and its successors.

     "MORTGAGE" shall mean a first lien deed of trust or mortgage (together with
any related assignment of rents) between the Lessor, as mortgagor or trustor,
and the Lender, as mortgagee or beneficiary, and as the same may be renewed,
amended, modified, consolidated, replaced or extended from time to time. During
periods when there is no Mortgage, references in the Lease to the Mortgage shall
have no force or effect.

     "MORTGAGED PROPERTY" shall mean the Mortgaged Property or Trust Property,
as defined in the Mortgage.

     "NET CASUALTY PROCEEDS" shall mean the compensation and/or insurance
payments (whether received from a third party insurance company or from Lessee
because it has self-insured) net of the reasonable expenses of collecting such
amounts incurred by the Lessor and Lender if a Lease Event of Default exists,
and the Lessee, and received by the Lender, the Lessor or the Lessee in respect
of the Property by reason of and on account of an Event of Loss described in
clause (y) of the definition thereof or a casualty.

     "NET CONDEMNATION PROCEEDS" shall mean any award or compensation net of the
reasonable expenses of collecting such amounts incurred by the Lessor and the
Lender if a Lease Event of Default exists, and the Lessee, and received by the
Lender, the Lessor or the Lessee in respect of the Property by reason of and on
account of a Condemnation.

     "NET PROCEEDS" shall mean Net Casualty Proceeds and Net Condemnation
Proceeds.

     "NONSEVERABLE" shall describe an Alteration or part of an Alteration which
cannot be removed from the existing Improvements or the Land without causing
material damage to the property; provided that Lessee's Equipment and Personalty
shall not be construed as Nonseverable.

     "OFFICER'S CERTIFICATE" of a Person or any Person signing on behalf of a
Person shall mean a certificate signed, in the case of a partnership, by a
general partner of such partnership, or in the case of a corporation, by an
Authorized Officer of such Person, or, in the case of a limited liability
company, by the manager of such limited liability company.

     "OVERALL TRANSACTION" shall mean all the transactions and activities
referred to in or contemplated by the Lease.

     "PERMITS" shall mean as to the Premises all licenses, authorizations,
certificates, variances, concessions, grants, registrations, consents, permits
and other approvals issued by a Governmental Authority now or hereafter
pertaining to the ownership, management, occupancy, use or operation of such
Premises, including certificates of occupancy.

                                      A-10
<Page>

     "PERMITTED ENCUMBRANCES" shall mean the easements, rights of way,
reservations, servitudes and rights of others against the Property which are
listed in the Title Policy issued to the Lessor or the Lender (as applicable).

     "PERMITTED INVESTMENTS" shall mean any one or more of the following
obligations or securities having (a) a predetermined fixed dollar of principal
due at maturity that cannot vary or change, (b) bearing interest that may either
be fixed or variable but which is tied to a single interest rate index plus a
single fixed rate spread (if any) and move proportionately with that index, and
(c) having the required ratings, if any, provided for in this definition:

     (i)   direct obligations of, and obligations fully guaranteed as to timely
payment of principal and interest by, the United States of America or any agency
or instrumentality of the United States of America, the obligations of which are
backed by the full faith and credit of the United States of America that mature
in thirty (30) days or less after the date of issuance and that does not have a
"r" highlighter affixed to its rating;

     (ii)  time deposits, unsecured certificates of deposit, or bankers'
acceptances that mature in thirty (30) days or less after the date of issuance
and are issued or held by any depository institution or trust company (including
the Lender) incorporated or organized under the laws of the United States of
America or any State thereof and subject to supervision and examination by
federal or state banking authorities, so long as the commercial paper or other
short-term debt obligations of such depository institution or trust company are
rated at least "A-1" and "P-1" by Standard & Poor's and Moody's, respectively,
or such other rating as would not result in the downgrading, withdrawal or
qualification of the then current rating assigned by the Rating Agencies to the
Pass-Through Certificates, as evidenced in writing and that does not have a "r"
highlighter affixed to its rating;

     (iii) repurchase agreements or obligations with respect to any security
described in clause (i) above where such security has a remaining maturity of
thirty (30) days or less and where such repurchase obligation has been entered
into with a depository institution or trust company (acting as principal)
described in clause (ii) above;

     (iv)  debt obligations bearing interest or sold at a discount issued by any
corporation incorporated under the laws of the United States of America or any
state thereof which mature in thirty (30) days or less from the date of
issuance, which debt obligations have ratings from Moody's and Standard & Poor's
in the highest category possible, or such other rating as would not result in
the downgrading, withdrawal or qualification of the then-current rating assigned
by the Rating Agencies to any Pass-Through Certificate as specified in writing
by the Rating Agencies and that does not have a "r" highlighter affixed to its
rating; provided, however, that securities issued by any particular corporation
will not be Permitted Investments to the extent that investment therein will
cause the then-outstanding principal amount of securities issued by such
corporation and held in the accounts established hereunder to exceed 10% of the
sum of the aggregate principal balance and the aggregate principal amount of all
Permitted Investments in such accounts; and

     (v)   commercial paper (including both non-interest-bearing discount
obligations and interest-bearing obligations) payable on demand or on a
specified date maturing in thirty (30)

                                      A-11
<Page>

days or less after the date of issuance thereof and which is rated in the
highest category possible by Moody's and Standard & Poor's and that does not
have a "r" highlighter affixed to such rating.

     "PERMITTED LIENS" shall mean:

     (a)  the respective rights and interests of the Lessee, the Lessor and the
Lender under the Lease and any Mortgage,

     (b)  Liens for Taxes either not yet due or being contested in good faith
and by appropriate proceedings, so long as such proceedings shall not involve
any danger of the sale, forfeiture or loss of any part of the Property, title
thereto or any interest therein (other than to a de minimis extent) and are
undertaken in accordance with the terms of any documents securing the Lender's
loan to Lessor, (including, without limitation, posting of any bonds or other
collateral to the extent required by such documents),

     (c)  materialmen's, mechanics', workers', repairmen's, employees or other
like Liens for amounts either not yet due or being contested in good faith and
by appropriate proceedings so long as such proceedings shall not involve any
danger of the sale, forfeiture or loss of any part of the Property, title
thereto or any interest therein (other than to a de minimis extent), provided

     Lessee agrees that it shall pay, discharge or record or bond any such lien
within sixty (60) days after Lessee receives notice thereof, if Lessee does not
have a Required Rating equal to or greater than the Trigger Rating, or if a
Lease Event of Default under Section 16.1 (a), (b) or (c) exists,

     (d)  Liens arising out of judgments or awards with respect to which at the
time an appeal or proceeding for review is being prosecuted in good faith and
either which have been bonded or for the payment of which adequate reserves
shall have been provided to Lessor's reasonable satisfaction, provided that if
the long-term unsecured debt of Lessee shall not have a Required Rating of at
least the Trigger Rating, then any such amount in excess of $500,000.00 (as
adjusted upward by the CPI every January 1) (unless Lessee is insured therefor),
shall be bonded or discharged by Lessee within thirty (30) days after Lessee's
knowledge thereof,

     (e)  easements, rights of way, reservations, servitudes and rights of
others against the Property which are granted pursuant to Section 25.11 of the
Lease and which could not reasonably be expected to have a material adverse
effect on the Property,

     (f)  Permitted Encumbrances, and

     (g)  assignments and subleases expressly permitted by the Lease.

     No lien, judgment, charge or other agreement shall be deemed to be
Permitted Lien if such lien, judgment, charge or other agreement, individually
or in the aggregate with other liens, judgments, charges or agreements,
materially and adversely affect (i) the value of the Property, (ii) Lessee's
ability to pay all Rent, as and when due hereunder, or (iii) Lessee's right to
use and operate the Property.

                                      A-12
<Page>

     "PERMITTED USE" shall have the meaning given to such term in Section 8.1 of
the Lease.

     "PERSON" shall mean individual, corporation, partnership, joint venture,
association, joint-stock company, trust, limited liability company,
non-incorporated organization or government or any agency or political
subdivision thereof.

     "PROCEEDS TRUSTEE" shall mean the Lender or, if the Property shall not at
the time in question be encumbered by a Mortgage, a federally insured bank or
other financial institution, selected by Lessor and reasonably satisfactory to
Lessee.

     "PROHIBITED TRANSFEREES" shall mean any U.S. or international company (or
Affiliate) which (i) has insurance or reinsurance as one of its principal
business lines, and (ii) has a market capitalization or net assets at least
equal to five percent (5%) of the market capitalization, or net assets, as
applicable, of Zurich Financial Services, or (iii) is reasonably considered by
Lessee to be one of the ten (10) largest competitors of Zurich Financial
Services or Zurich North America in any of each of its major business lines.
Lessee, acting reasonably, shall, within ten (10) days of Lessor's request,
advise Lessor if whether a prospective purchaser whose name (and direct and
indirect owners and Affiliates) have been furnished to Lessee is a Prohibited
Transferee.

     "PROPERTY" shall mean the real property whose parcel or parcels of land are
described on Exhibit A to the Lease (the "LAND"); together with all buildings,
structures, and other improvements of every kind situated on the Land
(collectively, the "IMPROVEMENTS"); together with all easements, rights and
appurtenances relating to the Land or the Improvements; and together with all
fixtures, including all components thereof, on and in respect to the
Improvements, including, without limitation, all built-in refrigeration and
freezer equipment used in the operation of the Property, together with all
replacements, modifications, alterations and additions thereto (collectively,
the "FIXTURES"), provided that in no event shall "Property" include Lessee's
Equipment and Personalty.

     "QUALIFIED APPRAISER" means an independent nationally recognized appraiser
who shall be a member of The Appraisal Institute (or its successor organization)
with not less than five (5) years experience appraising properties similar to
the Property in the market in which the Property is located.

     "RATING AGENCIES" shall mean Moody's and Standard & Poor's.

     "REFERENCE RATE" shall mean ______________________________.

     "RELEASE" shall mean the release or threatened release of any Hazardous
Material into or upon or under any land or water or air, or otherwise into the
environment, including, without limitation, by means of burial, disposal,
discharge, emission, injection, spillage, leakage, seepage, leaching, dumping,
pumping, pouring, escaping, emptying, placement and the like.

     "REMEDIAL ACTION" means the investigation, response, clean-up, remediation,
prevention, mitigation or removal of contamination, environmental degradation or
damage caused by, related to or arising from the existence, generation, use,
handling, treatment, storage, transportation, disposal, discharge, Release
(including a continuous Release), or emission of Hazardous Materials, including,
without limitation, investigations, response, removal, monitoring and remedial
actions under CERCLA; corrective action under the Resource Conservation and

                                      A-13
<Page>

Recovery Act of 1976, as amended, the investigation, removal or closure of any
underground storage tanks, and any related soil or groundwater investigation,
remediation or other action, and investigation, clean-up or other actions
required under or necessary to comply with any Environmental Laws.

     "RENEWAL TERM" shall have the meaning specified in Section 5.1 of the
Lease.

     "RENT" shall mean Base Rent and Supplemental Rent, collectively.

     "RENT COLLECTION ACCOUNT" shall mean the account established by the Lender
from time to time, and to which Lessee is directed to make all payments of Rent
due to the Lender.

     "RENT PAYMENT DATES" shall mean the 1st day of each month during the Lease
Term, commencing December 1, 2004, provided, however, in the event such date is
not a Business Day, the Rent Payment Date shall be the immediately following
Business Day.

     "REQUIRED RATING" shall mean a rating of the Lessee at the level set forth
in the Lease as required for Lessee to have the benefit conferred, issued by
Standard & Poors and Moody's (or any replacement of either of them made by the
Lender (in which case the rating shall be the equivalent)).

     "RESPONSIBLE OFFICER" shall mean an officer of Lender.

     "RESTORATION FUND" shall have the meaning specified in Section 12.4(a) of
the Lease.

     "SALE AND PURCHASE AGREEMENT" shall mean the Purchase and Sale Agreement
dated as of November 1, 2004 between Lessee's Affiliate as Seller and Lessor as
Purchaser.

     "STANDARD & POOR'S" shall mean Standard & Poor's Ratings Services, a
division of The McGraw-Hill Companies, Inc., and its successors.

     "STIPULATED LOSS VALUE" shall mean 101% of the purchase set forth in the
Sale and Purchaser Agreement.

     "STIPULATED LOSS VALUE DATE" shall have the meaning specified in Section
12.1(i) of the Lease, and after expiration of the Base Term shall mean the first
day of each month during a Renewal Term.

     "SUBLEASE" shall have the meaning given such term in Section 14.1 of the
Lease.

     "SUBSIDIARY" shall mean any corporation whose assets and liabilities are
consolidated with that of Lessee.

     "SUPPLEMENTAL RENT" shall mean any and all amounts, fees, expenses,
liabilities, obligations, late charges, Taxes and Impositions other than Base
Rent which Lessee assumes or agrees or is otherwise obligated to pay under the
Lease, including, without limitation, to the Lessor, the Lender or any other
party, including Fair Market Sales Value payments, Stipulated Loss value
payments, and indemnities and damages for breach of any covenants,
representations,

                                      A-14
<Page>

warranties or agreements; provided that, when Supplemental Rent is used with
respect to the Property, then Supplemental Rent shall be such amounts determined
in respect of the Property.

     "SURVIVING LESSEE" shall have the meaning given such term in Section 20.3
of the Lessee.

     "TERM" shall mean the Base Term and Renewal Term (if any).

     "TERMS" shall have the meaning specified in Section 4.1 of the Lease.

     "THRESHOLD AMOUNT" shall mean $5,000,000.00, but if the Lessee does not
have a credit rating (as calculated under the definition of Trigger Rating) at
least equal to the Trigger Rating, Threshold Amount shall mean $2,000,000.

     "TITLE INSURANCE COMPANY" shall mean Chicago Title Insurance Company.

     "TRIGGER RATING", with respect to any Person, shall mean that the senior
unsecured obligations of such Person shall have a rating, (or if the senior
unsecured obligations of such Person shall not be rated, such Person shall have
a confidential debt rating) of BBB by Standard & Poor's, and by Baa2 by
Moody's.

     "UCC" shall mean the Uniform Commercial Code as enacted by each state in
which Property is located, as applicable.

     "UNAVOIDABLE DELAYS" shall mean delays caused by war, riot, civil
commotion, strikes, labor action, acts of God, force majeure, shortages of
supplies or labor, adverse weather condition not reasonably anticipatable given
the location of a Property and the season of year, or any other cause not
reasonably within the control of Lessee but excluding the financial condition of
the Lessee.

                                      A-15
<Page>

                                                                    SCHEDULE 3.1

                                 Rental Payments

<Table>
<Caption>
             YEARS                                        RENT PER ANNUM
             -----                                        --------------
    <S>                                                   <C>
              1-12                                        $ 8,883,864.00

      FIRST RENEWAL TERM                                  $ 9,105,961.00

      SECOND RENEWAL TERM                                 $ 9,333,610.00

    ADDITIONAL RENEWAL TERMS                       95% FAIR MARKET RENTAL VALUE
</Table>

                                      - 1 -
<Page>

                                                                    SCHEDULE 9.1

                             Insurance Requirements

     (a)  Lessee covenants and agrees that it will at all times keep in full
force and effect the following insurance coverage:

          (i)   A broad form commercial general liability insurance policy
     (unamended), including but not limited to premises, operations, automobile
     liability (which may be carried by separate policy) and products liability,
     personal injury liability, contractual liability, and property damage
     liability coverage at the Property and the business conducted by Lessee
     thereon. The policy shall provide coverage limits of not less than Two
     Million Dollars ($2,000,000) per occurrence. The commercial general
     liability policy shall also include a commercial excess or umbrella
     liability of Ten Million Dollars ($10,000,000) and shall name Lessor and
     the Lender as additional insureds, as their interest may appear. Lessor may
     reasonably require other types of general liability insurance, based upon
     (A) the loss history at the Property, and (B) industry standards, and
     taking into account Lessee's (or its parent's, if applicable) insurance
     program, and other types of coverage being obtained in similar
     transactions.

          (ii)  A policy of standard full-replacement insurance against physical
     loss or damage by fire, lightning and other risks and supplementary perils
     from time to time included under all risk policies, with standard and
     extended coverage or all risk endorsement, including without limitation,
     vandalism and malicious mischief (with agreed amount endorsements) and also
     including against terrorist acts (to the extent commercially available at
     commercially reasonable rates) of all building and other facilities and
     improvements constructed on the Property and all tenant finish and
     leasehold improvements and fixtures. This policy shall name Lessor and the
     Lender as loss payees as their interest may appear. To the extent
     commercially available, such policy shall contain a deductible of not more
     than Two Hundred Fifty Thousand Dollars ($250,000.00) per occurrence unless
     Lessee has a Required Rating at least equal to the Trigger Rating, in which
     case the deductible may be no more than five percent (5%) of the
     replacement cost of the Improvements, excluding footings and foundation, as
     reasonably evidenced to Lessor and Lender upon request of Lessor on behalf
     of the Lender. Lessee shall be responsible for all deductibles.

          (iii) Workers' compensation or other such insurance in accordance with
     applicable state law requirements covering all of Lessee's employees.

     If Lessee is self-insuring, its obligations shall be that of an insurer
under the form of policy delivered to Lessor as of the Closing.

     (b)  If the Lessee fails to satisfy the condition necessary to maintain a
program of self-insurance adequate to satisfy the requirements set forth herein,
Lessee shall have a period of five (5) days in which to obtain the necessary
insurance coverage and deliver to Lessor and the Lender a certificate of
insurance evidencing compliance with the requirements set forth in Section 9.1.

                                      - 1 -
<Page>

     (c)  All policies of insurance described in this Schedule which Lessee
is required to procure and maintain shall be issued by one or more primary
insurers having a Standard & Poor's rating equal to A- or better.

     (d)  Unless Lessee elects (and is permitted) to self-insure as provided
in Section 9.1(b), certificates of such insurance will be delivered to Lessor
and the Lender, and any additional insureds upon execution of this Lease and any
renewals or extensions of said policies or certificates of insurance shall be
delivered to Lessor and the Lender at least ten (10) days prior to the
expiration or termination of such policies. Upon request of Lessor or Lender,
Lessee shall provide certified copies of those portions of any policy requested
covering all aspects of how a claim can or may be made under such policy, within
thirty (30) days of request. In the alternative, Lessee may provide a
certificate from its insurance broker setting forth all of the foregoing, in
form and substance reasonably satisfactory to Lessor and the Lender. Unless
Lessee elects (and is permitted) to self-insure as provided in Section 9.1(b),
all liability and property damage policies will contain the following
provisions;

          (i)   The company writing such policy will agree to give the insured
     and additionally named insured parties or loss payees not less than thirty
     (30) days notice in writing prior to any cancellation, reduction, or
     material modification of such insurance;

          (ii)  Lessor and the Lender shall be named as additional
     insured or loss payees, as their interests may appear, for each insurance
     policy required to be maintained by Lessee (except (a)(iv) above), with all
     proceeds under any policy under (a)(ii) and (iii) to be paid in accordance
     with the provisions of the Lease.

     (e)  Any insurance required by the Lease (excluding, however, the
coverage identified in Section (a)(iv) above) may be brought within the coverage
of a so-called blanket policy or policies of insurance carried by and maintained
by the insuring party insuring the combined operations at the Property with
other premises leased or owned by Lessee, so long as the insured party and the
additional insureds required hereunder are named under such policies as their
interest may appear with coverage at least as good as required herein.

     (f)  If Lessee fails to acquire or maintain the insurance required
pursuant to this Schedule and Article 9 or to pay the premiums for such
insurance and deliver the required certificates, Lessor may, in addition to
other rights and remedies available to Lessor, acquire such insurance and/or pay
the requisite premiums therefor. Such premiums so paid by Lessor will be
reimbursable and payable by Lessee immediately upon written demand therefor made
to Lessee by Lessor, plus interest at the Default Rate from the date paid by
Lessor until reimbursement by Lessee.

     (g)  Except to the extent otherwise provided in the Lease, the parties
hereto release each other, and their respective representatives, agents,
contractors and employees from any claims for damage to the Property and all
improvements located in the Property, and to the fixtures, personal property,
improvements, and alteration of either Lessor or Lessee in or upon the Property,
that are caused by or result from risks insured against under any property
insurance policies carried by the parties (or which should have been carried by
the parties pursuant to the terms hereof) or, in the case of Lessee's
self-insurance, all risks that would otherwise be insured

                                      - 2 -
<Page>

against under the property policies identified herein; provided, however, the
foregoing shall not impair any claim against Lessee in its capacity as self
insurer. Each party shall cause each property insurance policy obtained by it
(recognizing that Lessor may not in fact obtain any insurance) to provide that
the insurance company waives in writing all right of recovery by way of
subrogation against the other party in connection with any damage covered by
such policy. Neither party shall be liable to the other for any damage caused by
fire or any of the risks insured against (or to be insured against) under any
property insurance policy required by the Lease or self-insurance maintained in
lieu of any such required insurance.

                                      - 3 -
<Page>

                                                                   SCHEDULE 12.2

The first $500,000.00 of any Condemnation shall be divided between the Lessor
and Lessee as follows:

<Table>
<Caption>
If the taking takes place in:        The Lessor receives:      The Lessee receives:
          <S>                                <C>                       <C>
          2005                                8.3%                     91.7%

          2006                               16.7%                     83.3%

          2007                                 25%                       75%

          2008                               33.3%                     66.7%

          2009                               41.7%                     58.3%

          2010                                 50%                       50%

          2011                               58.3%                     41.7%

          2012                               66.7%                     33.3%

          2013                                 75%                       25%

          2014                               83.3%                     16.7%

          2015                               91.7%                      8.3%

          2016                                100%                        0%

          [  ]
</Table>

DURING ANY RENEWAL TERM THE PROCEEDS SHALL BE ALLOCATED AS IF THE FIRST YEAR OF
THE RENEWAL
                                       TERM WAS 2011, THE SECOND YEAR 2012, ETC.

                                      - 1 -
<Page>
                                                                       EXHIBIT A

                           Legal Description of Land

                                      - 2 -
<Page>
                                                                       EXHIBIT B

                           Form of Estoppel Agreement

     _________________, the_________________ of [Lessee][Lessor] hereby
certifies that as of_________________(the "CERTIFICATION DATE"), the following
is true and correct:

     (a) the Lease dated as of_____________________, 2004 is unmodified and in
force and effect [(or if there have been modifications, that the Lease is in
force and effect as modified, and identifying the modification agreements];

     (b) the date to which Base Rent has been paid is _________________________,
______;

     (c) there is no default by Lessee in the payment of Base Rent or any other
Rent payable to Lessor hereunder, and there is no other existing default by
either party with respect to which a notice of default or notice of termination
(by Lessor) has been served, [and, if there is any such default, specifying the
nature and extent thereof], and, to the actual knowledge of the property or
asset manager of Lessee having responsibility for the Lease and Property, and
the officer to which he or she reports, there are no acts under the Lease that
have occurred that would constitute a Lease Event of Default with notice, and
the passage of time;

     (d) to the knowledge of the signer, there are no setoffs, defenses or
counterclaims against enforcement of the obligations to be performed hereunder
existing in favor of the party executing such certificate.

     (e) the term of the Lease and the payment of rent commenced
on_______________________________, 2004, and is scheduled to expire on
_______________, 20__, unless renewed or terminated in accordance with the terms
of the Lease. Pursuant to the Lease, Lessee is entitled to renew the Lease for
five (5) terms of five (5) years each.

     [(f) Lessee is not the subject of any filing for bankruptcy or
reorganization under any applicable law,](1)

                                 [LESSOR/LESSEE]

                                   ----------

----------
(1)  Only if Lessee is delivering estoppel certificate.

                                        1Exhibit 4.1

 

 

 

WMG ACQUISITION CORP.,

as the Issuer,

 

the Guarantors named herein

and

 

WELLS FARGO BANK, NATIONAL ASSOCIATION,

as Trustee

 

INDENTURE

 

Dated as of April 8, 2004

 

U.S. Dollar-denominated 7 3/8% Senior Subordinated Notes due 2014

Sterling-denominated 8 1/8% Senior Subordinated Notes due 2014

 

 

 

CROSS-REFERENCE
TABLE

 

	
  TIA

  Section

  	
   

  	
  Indenture

  Section

  	
   

  
	
   

  	
   

  	
   

  
	
  310(a)(1)

  	
  7.10

  	
   

  
	
  (a)(2)

  	
  7.10

  	
   

  
	
  (a)(3)

  	
  N.A.

  	
   

  
	
  (a)(4)

  	
  N.A.

  	
   

  
	
  (a)(5)

  	
  7.08; 7.10

  	
   

  
	
  (b)

  	
  7.08; 7.10; 12.02

  	
   

  
	
  (c)

  	
  N.A.

  	
   

  
	
  311(a)

  	
  7.11

  	
   

  
	
  (b)

  	
  7.11

  	
   

  
	
  (c)

  	
  N.A.

  	
   

  
	
  312(a)

  	
  2.05

  	
   

  
	
  (b)

  	
  12.03

  	
   

  
	
  (c)

  	
  12.03

  	
   

  
	
  313(a)

  	
  7.06

  	
   

  
	
  (b)(1)

  	
  7.06

  	
   

  
	
  (b)(2)

  	
  7.06

  	
   

  
	
  (c)

  	
  7.06; 12.02

  	
   

  
	
  (d)

  	
  7.06

  	
   

  
	
  314(a)

  	
  4.06; 4.17

  	
   

  
	
  (b)

  	
  N.A.

  	
   

  
	
  (c)(1)

  	
  7.02; 12.04; 12.05

  	
   

  
	
  (c)(2)

  	
  7.02; 12.04; 12.05

  	
   

  
	
  (c)(3)

  	
  N.A.

  	
   

  
	
  (d)

  	
  N.A.

  	
   

  
	
  (e)

  	
  12.05

  	
   

  
	
  (f)

  	
  N.A.

  	
   

  
	
  315(a)

  	
  7.01(b)

  	
   

  
	
  (b)

  	
  7.05

  	
   

  
	
  (c)

  	
  7.01

  	
   

  
	
  (d)

  	
  6.05; 7.01(c)

  	
   

  
	
  (e)

  	
  6.11

  	
   

  
	
  316(a)(last sentence)

  	
  2.09

  	
   

  
	
  (a)(1)(A)

  	
  6.02

  	
   

  
	
  (a)(1)(B)

  	
  6.04

  	
   

  
	
  (a)(2)

  	
  9.02

  	
   

  
	
  (b)

  	
  6.07

  	
   

  
	
  (c)

  	
  9.05

  	
   

  
	
  317(a)(1)

  	
  6.08

  	
   

  
	
  (a)(2)

  	
  6.09

  	
   

  
	
  (b)

  	
  2.04

  	
   

  
	
  3 18(a)

  	
  12.01

  	
   

  
	
  (c)

  	
  12.01

  	
   

  

 

 

N.A. means Not Applicable

 

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

 

 

TABLE
OF CONTENTS

 

	
  ARTICLE
  ONE

  
	
   

  	
   

  	
   

  
	
  DEFINITIONS AND
  INCORPORATION BY REFERENCE

  
	
   

  	
   

  	
   

  
	
  SECTION 1.01.

  	
  DEFINITIONS

  	
   

  
	
  SECTION
  1.02.

  	
  OTHER
  DEFINITIONS

  	
   

  
	
  SECTION
  1.03.

  	
  INCORPORATION
  BY REFERENCE OF TIA

  	
   

  
	
  SECTION
  1.04.

  	
  RULES OF
  CONSTRUCTION

  	
   

  
	
   

  	
   

  	
   

  
	
  ARTICLE TWO

  
	
   

  
	
  THE SECURITIES

  
	
   

  
	
  SECTION
  2.01.

  	
  AMOUNT OF
  SECURITIES

  	
   

  
	
  SECTION
  2.02.

  	
  FORM AND
  DATING

  	
   

  
	
  SECTION
  2.03.

  	
  EXECUTION
  AND AUTHENTICATION

  	
   

  
	
  SECTION
  2.04.

  	
  REGISTRAR
  AND PAYING AGENT

  	
   

  
	
  SECTION
  2.05.

  	
  PAYING
  AGENT TO HOLD ASSETS IN TRUST

  	
   

  
	
  SECTION
  2.06.

  	
  HOLDER
  LISTS

  	
   

  
	
  SECTION
  2.07.

  	
  TRANSFER
  AND EXCHANGE

  	
   

  
	
  SECTION
  2.08.

  	
  REPLACEMENT
  SECURITIES

  	
   

  
	
  SECTION
  2.09.

  	
  OUTSTANDING
  SECURITIES

  	
   

  
	
  SECTION
  2.10.

  	
  TREASURY
  SECURITIES

  	
   

  
	
  SECTION
  2.11.

  	
  TEMPORARY
  SECURITIES

  	
   

  
	
  SECTION
  2.12.

  	
  CANCELLATION

  	
   

  
	
  SECTION
  2.13.

  	
  DEFAULTED
  INTEREST

  	
   

  
	
  SECTION
  2.14.

  	
  CUSIP,
  ISIN AND COMMON CODE NUMBERS

  	
   

  
	
  SECTION
  2.15.

  	
  DEPOSIT
  OF MONEYS

  	
   

  
	
  SECTION 2.16.

  	
  BOOK-ENTRY
  PROVISIONS FOR GLOBAL SECURITIES

  	
   

  
	
  SECTION
  2.17.

  	
  SPECIAL
  TRANSFER PROVISIONS

  	
   

  
	
  SECTION
  2.18.

  	
  COMPUTATION
  OF INTEREST

  	
   

  
	
  SECTION
  2.19.

  	
  CALCULATION
  OF PRINCIPAL AMOUNT OF SECURITIES

  	
   

  
	
   

  	
   

  	
   

  
	
  ARTICLE
  THREE

  
	
   

  	
   

  	
   

  
	
  REDEMPTION

  
	
   

  	
   

  	
   

  
	
  SECTION
  3.01.

  	
  NOTICES
  TO TRUSTEE

  	
   

  
	
  SECTION
  3.02.

  	
  SELECTION
  OF SECURITIES TO BE REDEEMED

  	
   

  
	
  SECTION
  3.03.

  	
  NOTICE OF
  REDEMPTION

  	
   

  

 

i

 

	
  SECTION
  3.04.

  	
  EFFECT OF
  NOTICE OF REDEMPTION

  	
   

  
	
  SECTION
  3.05.

  	
  DEPOSIT
  OF REDEMPTION PRICE

  	
   

  
	
  SECTION
  3.06.

  	
  SECURITIES
  REDEEMED IN PART

  	
   

  
	
   

  	
   

  	
   

  
	
  ARTICLE
  FOUR

  
	
   

  	
   

  	
   

  
	
  COVENANTS

  
	
   

  	
   

  	
   

  
	
  SECTION
  4.01.

  	
  PAYMENT
  OF SECURITIES

  	
   

  
	
  SECTION
  4.02.

  	
  MAINTENANCE
  OF OFFICE OR AGENCY

  	
   

  
	
  SECTION
  4.03.

  	
  CORPORATE
  EXISTENCE

  	
   

  
	
  SECTION
  4.04.

  	
  PAYMENT
  OF TAXES AND OTHER CLAIMS

  	
   

  
	
  SECTION
  4.05.

  	
  MAINTENANCE
  OF PROPERTIES AND INSURANCE

  	
   

  
	
  SECTION
  4.06.

  	
  COMPLIANCE
  CERTIFICATE; NOTICE OF DEFAULT

  	
   

  
	
  SECTION
  4.07.

  	
  COMPLIANCE
  WITH LAWS

  	
   

  
	
  SECTION
  4.08.

  	
  WAIVER OF
  STAY, EXTENSION OR USURY LAWS

  	
   

  
	
  SECTION
  4.09.

  	
  CHANGE OF
  CONTROL

  	
   

  
	
  SECTION
  4.10.

  	
  INCURRENCE
  OF INDEBTEDNESS AND ISSUANCE OF PREFERRED STOCK

  	
   

  
	
  SECTION
  4.11.

  	
  RESTRICTED
  PAYMENTS

  	
   

  
	
  SECTION
  4.12.

  	
  LIENS

  	
   

  
	
  SECTION
  4.13.

  	
  ASSET
  SALES

  	
   

  
	
  SECTION
  4.14.

  	
  TRANSACTIONS
  WITH AFFILIATES

  	
   

  
	
  SECTION
  4.15.

  	
  DIVIDEND
  AND OTHER PAYMENT RESTRICTIONS AFFECTING SUBSIDIARIES

  	
   

  
	
  SECTION
  4.16.

  	
  ADDITIONAL
  SUBSIDIARY GUARANTEES

  	
   

  
	
  SECTION
  4.17.

  	
  REPORTS
  TO HOLDERS

  	
   

  
	
  SECTION
  4.18.

  	
  LIMITATION
  ON LAYERING

  	
   

  
	
  SECTION
  4.19.

  	
  BUSINESS
  ACTIVITIES

  	
   

  
	
  SECTION
  4.20.

  	
  PAYMENTS
  FOR CONSENT

  	
   

  
	
   

  	
   

  	
   

  
	
  ARTICLE
  FIVE

  
	
   

  
	
  SUCCESSOR
  CORPORATION

  
	
   

  
	
  SECTION
  5.01.

  	
  MERGER,
  CONSOLIDATION, OR SALE OF ASSETS

  	
   

  
	
   

  	
   

  	
   

  
	
  ARTICLE SIX

  
	
   

  
	
  DEFAULT AND
  REMEDIES

  
	
   

  
	
  SECTION
  6.01.

  	
  EVENTS OF
  DEFAULT

  	
   

  
	
  SECTION
  6.02.

  	
  ACCELERATION

  	
   

  

 

ii

 

	
  SECTION 6.03.

  	
  OTHER
  REMEDIES

  	
   

  
	
  SECTION 6.04.

  	
  WAIVER OF
  DEFAULTS

  	
   

  
	
  SECTION 6.05.

  	
  CONTROL
  BY MAJORITY

  	
   

  
	
  SECTION 6.06.

  	
  LIMITATION
  ON SUITS

  	
   

  
	
  SECTION 6.07.

  	
  RIGHTS OF
  HOLDERS TO RECEIVE PAYMENT

  	
   

  
	
  SECTION 6.08.

  	
  COLLECTION
  SUIT BY TRUSTEE

  	
   

  
	
  SECTION 6.09.

  	
  TRUSTEE
  MAY FILE PROOFS OF CLAIM

  	
   

  
	
  SECTION 6.10.

  	
  PRIORITIES

  	
   

  
	
  SECTION 6.11.

  	
  UNDERTAKING
  FOR COSTS

  	
   

  
	
   

  	
   

  	
   

  
	
  ARTICLE
  SEVEN

  
	
   

  
	
  TRUSTEE

  
	
   

  
	
  SECTION
  7.01.

  	
  DUTIES OF
  TRUSTEE

  	
   

  
	
  SECTION
  7.02.

  	
  RIGHTS OF
  TRUSTEE

  	
   

  
	
  SECTION
  7.03.

  	
  INDIVIDUAL
  RIGHTS OF TRUSTEE

  	
   

  
	
  SECTION
  7.04.

  	
  TRUSTEE’S
  DISCLAIMER

  	
   

  
	
  SECTION
  7.05.

  	
  NOTICE OF
  DEFAULT

  	
   

  
	
  SECTION
  7.06.

  	
  REPORTS
  BY TRUSTEE TO HOLDERS

  	
   

  
	
  SECTION
  7.07.

  	
  COMPENSATION
  AND INDEMNITY

  	
   

  
	
  SECTION
  7.08.

  	
  REPLACEMENT
  OF TRUSTEE

  	
   

  
	
  SECTION
  7.09.

  	
  SUCCESSOR
  TRUSTEE BY MERGER, ETC

  	
   

  
	
  SECTION
  7.10.

  	
  ELIGIBILITY;
  DISQUALIFICATION

  	
   

  
	
  SECTION
  7.11.

  	
  PREFERENTIAL
  COLLECTION OF CLAIMS AGAINST THE ISSUER

  	
   

  
	
   

  	
   

  	
   

  
	
  ARTICLE
  EIGHT

  
	
   

  
	
  DISCHARGE
  OF INDENTURE; DEFEASANCE

  
	
   

  
	
  SECTION
  8.01.

  	
  TERMINATION
  OF THE ISSUER’S OBLIGATIONS

  	
   

  
	
  SECTION
  8.02.

  	
  LEGAL
  DEFEASANCE AND COVENANT DEFEASANCE

  	
   

  
	
  SECTION
  8.03.

  	
  CONDITIONS
  TO LEGAL DEFEASANCE OR COVENANT DEFEASANCE

  	
   

  
	
  SECTION
  8.04.

  	
  APPLICATION
  OF TRUST MONEY

  	
   

  
	
  SECTION
  8.05.

  	
  REPAYMENT
  TO THE ISSUER

  	
   

  
	
  SECTION
  8.06.

  	
  REINSTATEMENT

  	
   

  
	
   

  	
   

  	
   

  

 

iii

 

	
  ARTICLE
  NINE

  
	
   

  
	
  AMENDMENTS,
  SUPPLEMENTS AND WAIVERS

  
	
   

  	
   

  	
   

  
	
  SECTION
  9.01.

  	
  WITHOUT
  CONSENT OF HOLDERS

  	
   

  
	
  SECTION
  9.02.

  	
  WITH
  CONSENT OF HOLDERS

  	
   

  
	
  SECTION
  9.03.

  	
  EFFECT ON
  SENIOR DEBT

  	
   

  
	
  SECTION
  9.04.

  	
  COMPLIANCE
  WITH TIA

  	
   

  
	
  SECTION
  9.05.

  	
  REVOCATION
  AND EFFECT OF CONSENTS

  	
   

  
	
  SECTION
  9.06.

  	
  NOTATION
  ON OR EXCHANGE OF SECURITIES

  	
   

  
	
  SECTION
  9.07.

  	
  TRUSTEE
  TO SIGN AMENDMENTS, ETC

  	
   

  
	
   

  	
   

  	
   

  
	
  ARTICLE TEN

  
	
   

  
	
  SUBORDINATION
  OF SECURITIES

  
	
   

  
	
  SECTION
  10.01.

  	
  SECURITIES SUBORDINATED TO SENIOR DEBT

  	
   

  
	
  SECTION
  10.02.

  	
  SUSPENSION OF PAYMENT WHEN SENIOR DEBT
  IS IN DEFAULT

  	
   

  
	
  SECTION
  10.03.

  	
  SECURITIES SUBORDINATED TO PRIOR PAYMENT
  OF ALL SENIOR DEBT ON DISSOLUTION, LIQUIDATION OR REORGANIZATION OF THE
  ISSUER

  	
   

  
	
  SECTION
  10.04.

  	
  PAYMENTS MAY BE MADE PRIOR TO DISSOLUTION

  	
   

  
	
  SECTION
  10.05.

  	
  HOLDERS TO BE SUBROGATED TO RIGHTS OF
  HOLDERS OF SENIOR DEBT

  	
   

  
	
  SECTION
  10.06.

  	
  OBLIGATIONS OF THE ISSUER UNCONDITIONAL

  	
   

  
	
  SECTION
  10.07.

  	
  NOTICE TO TRUSTEE

  	
   

  
	
  SECTION
  10.08.

  	
  RELIANCE ON JUDICIAL ORDER OR
  CERTIFICATE OF LIQUIDATING AGENT

  	
   

  
	
  SECTION
  10.09.

  	
  TRUSTEE’S RELATION TO SENIOR DEBT

  	
   

  
	
  SECTION
  10.10.

  	
  SUBORDINATION RIGHTS NOT IMPAIRED BY
  ACTS OR OMISSIONS OF THE ISSUER OR HOLDERS OF SENIOR DEBT.

  	
   

  
	
  SECTION
  10.11.

  	
  SECURITYHOLDERS AUTHORIZE TRUSTEE TO
  EFFECTUATE SUBORDINATION OF SECURITIES

  	
   

  
	
  SECTION
  10.12.

  	
  THIS ARTICLE TEN NOT TO PREVENT EVENTS
  OF DEFAULT

  	
   

  
	
  SECTION
  10.13.

  	
  TRUSTEE’S COMPENSATION NOT PREJUDICED

  	
   

  
	
   

  	
   

  	
   

  
	
  ARTICLE
  ELEVEN

  
	
   

  
	
  GUARANTEES

  
	
   

  	
   

  	
   

  
	
  SECTION
  11.01.

  	
  UNCONDITIONAL
  GUARANTEE

  	
   

  
	
  SECTION
  11.02.

  	
  SUBORDINATION
  OF GUARANTEE

  	
   

  
	
  SECTION
  11.03.

  	
  LIMITATION
  ON GUARANTOR LIABILITY

  	
   

  

 

iv

 

	
  SECTION
  11.04.

  	
  EXECUTION AND DELIVERY OF SUBSIDIARY
  GUARANTEE FOR FUTURE GUARANTORS

  	
   

  
	
  SECTION
  11.05.

  	
  RELEASE
  OF A GUARANTOR

  	
   

  
	
  SECTION
  11.06.

  	
  WAIVER
  OF SUBROGATION

  	
   

  
	
  SECTION
  11.07.

  	
  IMMEDIATE
  PAYMENT

  	
   

  
	
  SECTION
  11.08.

  	
  NO
  SET-OFF

  	
   

  
	
  SECTION
  11.09.

  	
  GUARANTEE
  OBLIGATIONS ABSOLUTE

  	
   

  
	
  SECTION
  11.10.

  	
  GUARANTEE
  OBLIGATIONS CONTINUING

  	
   

  
	
  SECTION
  11.11.

  	
  GUARANTEE
  OBLIGATIONS NOT REDUCED

  	
   

  
	
  SECTION
  11.12.

  	
  GUARANTEE
  OBLIGATIONS REINSTATED

  	
   

  
	
  SECTION
  11.13.

  	
  GUARANTEE
  OBLIGATIONS NOT AFFECTED

  	
   

  
	
  SECTION
  11.14.

  	
  WAIVER

  	
   

  
	
  SECTION
  11.15.

  	
  NO
  OBLIGATION TO TAKE ACTION AGAINST THE ISSUER

  	
   

  
	
  SECTION
  11.16.

  	
  DEALING
  WITH THE ISSUER AND OTHERS

  	
   

  
	
  SECTION
  11.17.

  	
  DEFAULT
  AND ENFORCEMENT

  	
   

  
	
  SECTION
  11.18.

  	
  AMENDMENT,
  ETC

  	
   

  
	
  SECTION
  11.19.

  	
  ACKNOWLEDGMENT

  	
   

  
	
  SECTION
  11.20.

  	
  COSTS
  AND EXPENSES

  	
   

  
	
  SECTION
  11.21.

  	
  NO
  MERGER OR WAIVER; CUMULATIVE REMEDIES

  	
   

  
	
  SECTION
  11.22.

  	
  SURVIVAL
  OF GUARANTEE OBLIGATIONS

  	
   

  
	
  SECTION
  11.23.

  	
  GUARANTEE
  IN ADDITION TO OTHER GUARANTEE OBLIGATIONS

  	
   

  
	
  SECTION
  11.24.

  	
  SEVERABILITY

  	
   

  
	
  SECTION
  11.25.

  	
  SUCCESSORS
  AND ASSIGNS

  	
   

  
	
   

  	
   

  	
   

  
	
  ARTICLE
  TWELVE

  
	
   

  	
   

  	
   

  
	
  MISCELLANEOUS

  
	
   

  	
   

  	
   

  
	
  SECTION
  12.01.

  	
  TIA
  CONTROLS

  	
   

  
	
  SECTION
  12.02.

  	
  NOTICES

  	
   

  
	
  SECTION
  12.03.

  	
  COMMUNICATIONS
  BY HOLDERS WITH OTHER HOLDERS

  	
   

  
	
  SECTION
  12.04.

  	
  CERTIFICATE
  AND OPINION AS TO CONDITIONS PRECEDENT

  	
   

  
	
  SECTION
  12.05.

  	
  STATEMENTS
  REQUIRED IN CERTIFICATE OR OPINION

  	
   

  
	
  SECTION
  12.06.

  	
  RULES
  BY TRUSTEE, PAYING AGENT, REGISTRAR

  	
   

  
	
  SECTION
  12.07.

  	
  LEGAL
  HOLIDAYS

  	
   

  
	
  SECTION
  12.08.

  	
  GOVERNING
  LAW

  	
   

  
	
  SECTION
  12.09.

  	
  NO
  ADVERSE INTERPRETATION OF OTHER AGREEMENTS

  	
   

  
	
  SECTION
  12.10.

  	
  NO
  RECOURSE AGAINST OTHERS

  	
   

  
	
  SECTION
  12.11.

  	
  SUCCESSORS

  	
   

  
	
  SECTION
  12.12.

  	
  DUPLICATE
  ORIGINALS

  	
   

  

 

v

 

	
  SECTION
  12.13.

  	
  SEVERABILITY

  	
   

  
	
  SECTION
  12.14.

  	
  CURRENCY OF ACCOUNT; CONVERSION OF CURRENCY;
  FOREIGN EXCHANGE RESTRICTIONS

  	
   

  
	
   

  	
   

  	
   

  
	
  Signatures

  	
   

  	
   

  

 

 

EXHIBITS

 

	
  Exhibit A

  	
  -

  	
  Form of Dollar
  Security

  	
   

  
	
  Exhibit B

  	
  -

  	
  Form of Sterling
  Security

  	
   

  
	
  Exhibit C-1

  	
  -

  	
  Form of Legend
  for Dollar 144A Securities and Other Dollar Securities That Are Restricted Securities

  	
   

  
	
  Exhibit C-2

  	
  -

  	
  Form of Legend
  for Sterling 144A Securities and Other Sterling Securities That Are Restricted Securities

  	
   

  
	
  Exhibit D

  	
  -

  	
  Form of Legend
  for Regulation S Security

  	
   

  
	
  Exhibit E-1

  	
  -

  	
  Form of Legend
  for Global Dollar Security

  	
   

  
	
  Exhibit E-2

  	
  -

  	
  Form of Legend
  for Global Sterling Security

  	
   

  
	
  Exhibit F

  	
  -

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

  	
   

  
	
  Exhibit G

  	
  -

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

  	
   

  
	
  Exhibit H

  	
  -

  	
  Form of Guarantee

  	
   

  

 

Note:                                           This Table of Contents shall not, for any
purpose, be deemed to be part of the Indenture.

 

vi

 

INDENTURE
dated as of April 8, 2004 between WMG ACQUISITION CORP., a Delaware corporation
(the “Issuer”), as issuer, the
Guarantors (as defined herein) and WELLS FARGO BANK, NATIONAL ASSOCIATION, a
national banking association, as trustee (the “Trustee”).

 

Each party
hereto agrees as follows for the benefit of each other party and for the equal
and ratable benefit of the Holders.

ARTICLE ONE

 

DEFINITIONS AND INCORPORATION BY REFERENCE

 

SECTION 1.01.                                         Definitions.

 

Set forth
below are certain defined terms used in this Indenture.

 

“Acquired Debt” means, with respect to any specified Person:

 

(1)           Indebtedness of any
other Person existing at the time such other Person is merged with or into or
became a Restricted Subsidiary of such specified Person, including Indebtedness
incurred in connection with, or in contemplation of, such other Person merging
with or into, or becoming a Restricted Subsidiary of, such specified Person;
and

 

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

 

“Additional Interest” has
the meaning set forth in the Registration Rights Agreement.

 

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

 

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

 

“amend” means amend,
modify, supplement, restate or amend and restate, including successively; and “amending” and “amended” have
correlative meanings.

 

 

“asset” means any
asset or property, whether real, personal or other, tangible or intangible.

 

“Asset Sale” means
(i) the sale, conveyance, transfer or other disposition (whether in a single
transaction or a series of related transactions) of property or assets
(including by way of a sale and leaseback) of the Issuer or any Restricted
Subsidiary (each referred to in this definition as a “disposition”) or (ii) the issuance or sale of Equity
Interests of any Restricted Subsidiary (whether in a single transaction or a
series of related transactions), in each case, other than:

 

(1)           a disposition of
Cash Equivalents or obsolete or worn out property or equipment in the ordinary
course of business or inventory (or other assets) held for sale in the ordinary
course of business and dispositions of property no longer used or useful in the
conduct of business of the Issuer and its Restricted Subsidiaries;

 

(2)           the disposition of
all or substantially all of the assets of the Issuer in a manner permitted
pursuant to Section 5.01 or any disposition that constitutes a Change of
Control pursuant to this Indenture;

 

(3)           the making of any
Restricted Payment or Permitted Investment that is permitted to be made, and is
made, pursuant to Section 4.11 or the granting of a Lien permitted by Section
4.12;

 

(4)           any disposition of
assets or issuance or sale of Equity Interests of any Restricted Subsidiary in
any transaction or series of transactions with an aggregate fair market value
of less than $10.0 million;

 

(5)           any disposition of
property or assets or issuance of securities by a Restricted Subsidiary to the
Issuer or by the Issuer or a Restricted Subsidiary to another Restricted
Subsidiary;

 

(6)           the lease,
assignment, sublease, license or sublicense of any real or personal property in
the ordinary course of business;

 

(7)           any sale of Equity
Interests in, or Indebtedness or other securities of, an Unrestricted Subsidiary
(with the exception of Investments in Unrestricted Subsidiaries acquired
pursuant to clause (11) of the definition of “Permitted Investments”);

 

(8)           foreclosures on
assets;

 

(9)           disposition of an
account receivable in connection with the collection or compromise thereof;

 

2

 

(10)         sales of
Securitization Assets and related assets of the type specified in the
definition of “Securitization Financing” to a Securitization Subsidiary in
connection with any Qualified Securitization Financing; and

 

(11)         a transfer of
Securitization Assets and related assets of the type specified in the
definition of “Securitization Financing” (or a fractional undivided interest
therein) by a Securitization Subsidiary in a Qualified Securitization
Financing.

 

“Bankruptcy Law” means
Title 11, U.S. Code or any similar Federal, state or foreign law for the relief
of debtors.

 

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

 

“Board of Directors” means:

 

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

 

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

 

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

 

“Board Resolution” means,
with respect to any Person, a copy of a resolution certified by the Secretary
or an Assistant Secretary of such Person to have been 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
any day other than a Saturday, Sunday or any other day on which banking
institutions in the City of New York are required or authorized by law or other
governmental action to be closed.

 

“Capital Stock” means:

 

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

 

3

 

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

 

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

 

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

 

“Capitalized Lease Obligation” means,
at the time any determination thereof is to be made, the amount of the
liability in respect of a capital lease that would at such time be required to
be capitalized and reflected as a liability on a balance sheet (excluding the
footnotes thereto) in accordance with GAAP.

 

“Cash Contribution Amount” means
the aggregate amount of cash contributions made to the capital of the Issuer or
any Guarantor described in the definition of “Contribution Indebtedness.”

 

“Cash Equivalents” means:

 

(1)           U.S. dollars, pounds sterling, euros,
or, in the case of any Foreign Subsidiary, such local currencies held by it
from time to time in the ordinary course of business;

 

(2)           securities issued or directly and
fully and unconditionally guaranteed or insured by the government or any agency
or instrumentality of the United States or any member nation of the European
Union having maturities of not more than 12 months from the date of
acquisition;

 

(3)           certificates of deposit, time
deposits and eurodollar time deposits with maturities of 12 months or less from
the date of acquisition, bankers’ acceptances with maturities not exceeding 12
months and overnight bank deposits, in each case, with any lender party to the
Credit Agreement or with any commercial bank having capital and surplus in
excess of $500,000,000;

 

(4)           repurchase obligations for underlying
securities of the types described in clauses (2) and (3) above entered into
with any financial institution meeting the qualifications specified in clause
(3) above;

 

(5)           commercial paper maturing within 12
months after the date of acquisition and having a rating of at least A-1 from
Moody’s or P-1 from S&P;

 

4

 

(6)           investment funds at least 95% of the
assets of which constitute Cash Equivalents of the kinds described in clauses
(1) through (5) of this definition; and

 

(7)           readily marketable direct obligations
issued by any state of the United States or any political subdivision thereof
having one of the two highest rating categories obtainable from either Moody’s
or S&P with maturities of 12 months or less from the date of acquisition.

 

“Change of Control” means
the occurrence of any of the following:

 

(1)           the sale, lease, transfer or other
conveyance, in one or a series of related transactions, of all or substantially
all of the assets of the Issuer and its Subsidiaries, taken as a whole, to any
Person other than a Permitted Holder;

 

(2)           the Issuer becomes aware of (by way
of a report or any other filing pursuant to Section 13(d) of the Exchange Act,
proxy, vote, written notice or otherwise) the acquisition by any Person or
group (within the meaning of Section 13(d)(3) or Section 14(d)(2) of the
Exchange Act, or any successor provision), including any group acting for the
purpose of acquiring, holding or disposing of securities (within the meaning of
Rule 13d-5(b)(1) under the Exchange Act), other than the Permitted Holders, in
a single transaction or in a related series of transactions, by way of merger,
consolidation or other business combination or purchase of beneficial ownership
(within the meaning of Rule 13d-3 under the Exchange Act, or any successor
provision), of 50% or more of the total voting power of the Voting Stock of the
Issuer or any of its direct or indirect parent corporations; or

 

(3)           (A) prior to the first public
offering of common stock of either Holdco or the Issuer, the first day on which
the Board of Directors of Holdco shall cease to consist of a majority of
directors who (i) were members of the Board of Directors of Holdco on the Issue
Date or (ii) were either (x) nominated for election by the Board of Directors
of Holdco, a majority of whom were directors on the Issue Date or whose
election or nomination for election was previously approved by a majority of
such directors, or (y) designated or appointed by a Permitted Holder (each of
the directors selected pursuant to clauses (A)(i) and (A)(ii), “Continuing Directors”) and (B) after the
first public offering of common stock of either Holdco or the Issuer, (i) if
such public offering is of Holdco common stock, the first day on which a
majority of the members of the Board of Directors of Holdco are not Continuing
Directors or (ii) if such public offering is of the Issuer’s common stock, the
first day on which a majority of the members of the Board of Directors of the
Issuer are not Continuing Directors.

 

“Cinram Adjustment” means
cost savings and other adjustments to the Issuer from the disposition of its
DVD and CD manufacturing, printing, packaging, physical distribution and
merchandising businesses to Cinram International, Inc., which was consummated

 

5

 

on October 24, 2003, and the
associated long-term supply contract with Cinram for physical product and
distribution.

 

“Code” means the United States Internal
Revenue Code of 1986, as amended from time to time, and the regulations
promulgated and rulings issued thereunder. Section references to the Code are
to the Code, as in effect on the Issue Date, and any subsequent provisions of
the Code, amendatory thereof, supplemental thereto or substituted therefor.

 

“Commission” means
the Securities and Exchange Commission.

 

“Common
Depository” means, with respect to the Global Sterling
Securities, HSBC Bank plc, as common depository for Euroclear and Clearstream
or another Person designated as common depositary by the Issuer, which Person
must be a clearing agency registered under the Exchange Act.

 

“Consolidated
Depreciation and Amortization Expense” means, with respect to
any Person for any period, the total amount of depreciation and amortization
expense, including the amortization of deferred financing fees and other
noncash charges (excluding any noncash item that represents an accrual or
reserve for a cash expenditure for a future period), of such Person and its
Restricted Subsidiaries for such period on a consolidated basis and otherwise
determined in accordance with GAAP.

 

“Consolidated
Interest Expense” means, with respect to any Person for any
period, the sum, without duplication, of: (a) consolidated interest expense of
such Person and its Restricted Subsidiaries for such period (including
amortization of original issue discount, noncash interest payments (other than
imputed interest as a result of purchase accounting), the interest component of
Capitalized Lease Obligations, net payments (if any) pursuant to interest rate
Hedging Obligations, but excluding amortization of deferred financing fees or
expensing of any bridge or other financing fees relating to the Specified
Financings) and (b) consolidated capitalized interest of such Person and its
Restricted Subsidiaries for such period, whether paid or accrued, less (c)
interest income actually received in cash for such period; provided, however, that
Securitization Fees shall not be deemed to constitute Consolidated Interest
Expense.

 

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

 

(1)           any net after-tax
extraordinary, unusual or nonrecurring gains or losses (including, without
limitation, severance, relocation, transition and other restructuring costs)
(less all fees and expenses relating thereto) shall be excluded;

 

6

 

(2)           the Net Income for such period shall
not include the cumulative effect of a change in accounting principle(s) during
such period;

 

(3)           any net after-tax
gains or losses (less all fees and expenses relating thereto) attributable to
asset dispositions other than in the ordinary course of business (as determined
in good faith by the Board of Directors of the Issuer) shall be excluded;

 

(4)           the Net Income for
such period of any Person that is not a Subsidiary, or that is an Unrestricted
Subsidiary, or that is accounted for by the equity method of accounting, shall
be excluded; provided that, to the extent not already
included, Consolidated Net Income of the Issuer shall be increased by the
amount of dividends or distributions or other payments that are actually paid
in cash (or to the extent converted into cash) to the referent Person or a
Restricted Subsidiary thereof in respect of such period;

 

(5)           solely for the purpose of determining
the amount available for Restricted Payments under clause (3) of Section
4.11(a), the Net Income for such period of any Restricted Subsidiary (other
than a Guarantor) shall be excluded if the declaration or payment of dividends
or similar distributions by that Restricted Subsidiary of its Net Income is not
permitted at the date of determination without any prior governmental approval
(which has not been obtained) or, directly or indirectly, by the operation of
the terms of its charter or any agreement, instrument, judgment, decree, order,
statute, rule or governmental regulation applicable to that Restricted
Subsidiary or its stockholders, unless such restriction with respect to the
payment of dividends or similar distributions has been legally waived; provided that
Consolidated Net Income of such Person shall be increased by the amount of
dividends or distributions or other payments that are actually paid in cash (or
to the extent converted into cash) to such Person or a Restricted Subsidiary
thereof in respect of such period, to the extent not already included therein;

 

(6)           any noncash
impairment charges resulting from the application of Statements of Financial
Accounting Standards No. 142 and No. 144 and the amortization of intangibles
arising pursuant to Statement of Financial Accounting Standards No. 141 shall
be excluded;

 

(7)           solely for purposes of determining
the amount available for Restricted Payments under clause (3) of Section
4.11(a), an amount equal to any reduction in current taxes recognized during
the applicable period by the Issuer and its Restricted Subsidiaries as a direct
result of deductions arising from (A) the amortization allowed under Section
167 or 197 of the Code for the goodwill and other intangibles arising from the
Transactions and (B) employee termination and related restructuring reserves
established pursuant to purchase accounting for the two-year period commencing
with

 

7

 

the Issue
Date, in each case, will be included in the calculation of “Consolidated Net
Income” so long as such addition will not result in double-counting;

 

(8)           noncash compensation charges,
including any such charges arising from stock options, restricted stock grants
or other equity-incentive programs shall be excluded;

 

(9)           any net after-tax gains or losses
(less all fees and expenses or charges relating thereto) attributable to the
early extinguishment of Indebtedness shall be excluded; and

 

(10)         any noncash charges resulting from
mark-to-market accounting in accordance with Statements of Financial Accounting
Standards No. 133 and No. 150 and Emerging Issues Task Force Issue No. 00-19
relating to warrants owned by Time Warner Inc. shall be excluded.

 

Notwithstanding
the foregoing, for the purpose of Section 4.11 only (other than clause (3)(d)
of subsection (a) thereof), there shall be excluded from Consolidated Net
Income any income arising from any sale or other disposition of Restricted
Investments made by the Issuer and the Restricted Subsidiaries, any repurchases
and redemptions of Restricted Investments by the Issuer and the Restricted
Subsidiaries, any repayments of loans and advances which constitute Restricted
Investments by the Issuer and any Restricted Subsidiary, any sale of the stock
of an Unrestricted Subsidiary or any distribution or dividend from an
Unrestricted Subsidiary, in each case only to the extent such amounts increase
the amount of Restricted Payments permitted under clause (3)(d) of Section
4.11(a).

 

“Consolidated
Tangible Assets” means, with respect to any Person, the
consolidated total assets of such Person and its Restricted Subsidiaries
determined in accordance with GAAP, less all goodwill, trade names, trademarks,
patents, organization expense and other similar intangibles properly classified
as intangibles in accordance with GAAP.

 

“Contingent
Obligations” means, with respect to any Person, any
obligation of such Person guaranteeing any leases, dividends or other
obligations that do not constitute Indebtedness (“primary obligations”) of any other Person (the “primary obligor”) in any manner, whether
directly or indirectly, including, without limitation, any obligation of such
Person, whether or not contingent, (i) to purchase any such primary obligation
or any property constituting direct or indirect security therefor, (ii) to
advance or supply funds (A) for the purchase or payment of any such primary
obligation or (B) to maintain working capital or equity capital of the primary
obligor or otherwise to maintain the net worth or solvency of the primary obligor,
or (iii) to purchase property, securities or services primarily for the purpose
of assuring the owner of any such primary obligation of the ability of the
primary obligor to make payment of such primary obligation against loss in
respect thereof.

 

8

 

“Contribution
Indebtedness” means Indebtedness of the Issuer or any
Guarantor in an aggregate principal amount not greater than twice the aggregate
amount of cash contributions (other than Excluded Contributions) made to the
capital of the Issuer or such Guarantor after the Issue Date; provided that
such Contribution Indebtedness:

 

(1)           if the aggregate
principal amount of such Contribution Indebtedness is greater than one times
such cash contributions to the capital of the Issuer or such Guarantor, as
applicable, the amount of such excess shall be (A) (x) Subordinated
Indebtedness (other than Secured Indebtedness) or (y) Indebtedness that ranks pari passu with
the Securities (other than Secured Indebtedness) and (B) Indebtedness with a
Stated Maturity later than the Stated Maturity of the Securities, and

 

(2)           (a) is incurred
within 180 days after the making of such cash contributions and (b) is so
designated as Contribution Indebtedness pursuant to an Officers’ Certificate on
the date of the incurrence thereof.

 

“Corporate Trust
Office” means the corporate trust office of the Trustee
located at Sixth Street and Marquette Avenue, N9303-20, Minneapolis, Minnesota
55479, Attention: Corporate Trust Department, or such other office, designated
by the Trustee by written notice to the Issuer, at which at any particular time
its corporate trust business shall be administered.

 

“Credit Agreement” means that certain Amended
and Restated Credit Agreement, dated as of April 8, 2004, by and among the
Issuer, the other borrowers from time to time party thereto, Holdco, Banc of
America Securities LLC and Deutsche Bank Securities Inc., as Joint Lead
Arrangers and Joint Book Managers, Lehman Brothers Inc. and Merrill Lynch, Pierce,
Fenner & Smith Incorporated, as Co-Arrangers and Co-Book Managers, Deutsche
Bank Securities Inc. and Lehman Commercial Paper Inc., as Co-Syndication
Agents, Merrill Lynch, Pierce, Fenner & Smith Incorporated, as
Documentation Agent, and Bank of America, N.A., as Administrative Agent, Swing
Line Lender and L/C Issuer and the lenders party thereto from time to time,
including any related notes, guarantees, collateral documents, instruments and
agreements executed in connection therewith, and in each case as amended,
restated, supplemented, modified, renewed, refunded, replaced or refinanced
from time to time in one or more agreements or indentures (in each case with
the same or new lenders or institutional investors), including any agreement
extending the maturity thereof or otherwise restructuring all or any portion of
the Indebtedness thereunder or increasing the amount loaned or issued
thereunder or altering the maturity thereof.

 

“Custodian” means
any receiver, trustee, assignee, liquidator, sequestrator or similar official
under any Bankruptcy Law.

 

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

 

9

 

“Depositary” shall
mean The Depository Trust Company, New York, New York, or a successor thereto
registered under the Exchange Act or other applicable statute or regulation.

 

“Designated
Noncash Consideration” means the fair market value of noncash
consideration received by the Issuer or one of its Restricted Subsidiaries in
connection with an Asset Sale that is so designated as Designated Noncash
Consideration pursuant to an Officers’ Certificate setting forth the basis of
such valuation, less the amount of cash or Cash Equivalents received in
connection with a subsequent sale of such Designated Noncash Consideration.

 

“Designated
Preferred Stock” means Preferred Stock of the Issuer or any
direct or indirect parent company of the Issuer (other than Disqualified Stock)
that is issued for cash (other than to the Issuer or any of its Subsidiaries or
an employee stock ownership plan or trust established by the Issuer or any of
its Subsidiaries) and is so designated as Designated Preferred Stock, pursuant
to an Officers’ Certificate, on the issuance date thereof, the cash proceeds of
which are excluded from the calculation set forth in clause (3) of Section
4.11(a).

 

“Designated
Senior Debt” means:

 

(1)           any Indebtedness outstanding under
the Credit Agreement; and

 

(2)           any other Senior Debt permitted under
this Indenture the principal amount of which is $25.0 million or more and that
has been designated by the Issuer in the instrument evidencing that Senior Debt
as “Designated Senior Debt.”

 

“Disqualified
Stock” means, with respect to any Person, any Capital Stock
of such Person which, by its terms (or by the terms of any security into which
it is convertible or for which it is putable or exchangeable), or upon the
happening of any event, matures or is mandatorily redeemable (other than as a result
of a change of control or asset sale), pursuant to a sinking fund obligation or
otherwise, or is redeemable at the option of the holder thereof (other than as
a result of a change of control or asset sale), in whole or in part, in each
case prior to the date 91 days after the earlier of the final maturity date of
the Securities or the date the Securities are no longer outstanding; provided, however, that
if such Capital Stock is issued to any plan for the benefit of employees of
Holdco or its Subsidiaries or by any such plan to such employees, such Capital
Stock shall not constitute Disqualified Stock solely because it may be required
to be repurchased by Holdco or its Subsidiaries in order to satisfy applicable
statutory or regulatory obligations.

 

“Dollar Exchange
Securities” means any Dollar Securities issued in exchange
for Initial Dollar Securities or Dollar Securities without a legend.

 

10

 

“Dollar
Securities” means the U.S. Dollar-denominated 7 3/8% Senior
Subordinated Notes due 2014 issued by the Issuer, including, without
limitation, the Dollar Exchange Securities and the Additional Dollar
Securities, treated as a single class of securities, as amended from time to
time in accordance with the terms hereof, that are issued pursuant to this
Indenture.

 

“Domestic
Subsidiary” means any Subsidiary of the Issuer that was
formed under the laws of the United States, any state of the United States, the
District of Columbia or any territory of the United States.

 

“EBITDA” means,
with respect to any Person for any period, the Consolidated Net Income of such
Person for such period plus, without duplication,

 

(1)           provision for taxes based on income
or profits, plus franchise or similar taxes of such Person for such period
deducted in computing Consolidated Net Income, plus

 

(2)           Consolidated Interest Expense of such
Person for such period to the extent the same was deducted in calculating such
Consolidated Net Income, plus

 

(3)           Consolidated Depreciation and
Amortization Expense of such Person for such period to the extent such
depreciation and amortization were deducted in computing Consolidated Net
Income, plus

 

(4)           any reasonable expenses or charges
related to any Equity Offering, Permitted Investment, acquisition, recapitalization
or Indebtedness permitted to be incurred under this Indenture or to the
Transactions and, in each case, deducted in such period in computing
Consolidated Net Income, plus

 

(5)           the amount of any restructuring
charges or reserves (which, for the avoidance of doubt, shall include
retention, severance, systems establishment cost, excess pension charges,
contract termination costs, including future lease commitments, and costs to
consolidate facilities and relocate employees) deducted in such period in
computing Consolidated Net Income, plus

 

(6)           without duplication, any other
noncash charges (including any impairment charges and the impact of purchase
accounting, including, but not limited to, the amortization of inventory
step-up) reducing Consolidated Net Income for such period (excluding any such
charge that represents an accrual or reserve for a cash expenditure for a
future period), plus

 

(7)           any net gain or loss resulting from
Hedging Obligations relating to currency exchange risk, plus

 

11

 

(8)           the amount of management, monitoring,
consulting and advisory fees and related expenses paid to the Sponsors (or any
accruals relating to such fees and related expenses) during such period; provided that
such amount shall not exceed $10.0 million in any four-quarter period, plus

 

(9)           Securitization Fees to the extent
deducted in calculating Consolidated Net Income for such period, plus

 

(10)         the Cinram Adjustment, plus

 

(11)         any net after-tax income or loss from
discontinued operations and any net after-tax gains or losses on disposal of
discontinued operations, plus

 

(12)         without duplication, pension
curtailment expenses, transaction costs and executive contract expenses
incurred by affiliated entities of the Issuer (other than Holdco and its
Subsidiaries) on behalf of Holdco or any of its Subsidiaries and reflected in
the combined financial statements of the Issuer as capital contributions, less

 

(13)         without duplication, noncash items
increasing Consolidated Net Income of such Person for such period (excluding
any items which represent the reversal of any accrual of, or cash reserve for,
anticipated cash charges or asset valuation adjustments made in any prior
period).

 

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

 

“Equity Offering”
means any public or private sale of common stock or Preferred
Stock of the Issuer or any of its direct or indirect parent corporations
(excluding Disqualified Stock), other than (i) public offerings with respect to
common stock of the Issuer or of any direct or indirect parent corporation of
the Issuer registered on Form S-8, (ii) any such public or private sale that
constitutes an Excluded Contribution or (iii) an issuance to any Subsidiary.

 

“Exchange Act”
means the Securities Exchange Act of 1934, as amended, and the rules and
regulations of the Commission promulgated thereunder.

 

“Exchange
Securities” means the Dollar Exchange Securities and the
Sterling Exchange Securities.

 

“Excluded
Contribution” means net cash proceeds, marketable securities
or Qualified Proceeds, in each case received by the Issuer and its Restricted
Subsidiaries from:

 

12

 

(1)           contributions to its common equity
capital; and

 

(2)           the sale (other than to a Subsidiary
or to any management equity plan or stock option plan or any other management
or employee benefit plan or agreement of the Issuer or any Subsidiary) of
Capital Stock (other than Disqualified Stock and Designated Preferred Stock),

 

in each case designated as
Excluded Contributions pursuant to an Officers’ Certificate on the date such
capital contributions are made or the date such Equity Interests are sold, as
the case may be, which are excluded from the calculation set forth in clause
(3) of Section 4.11(a).

 

“Existing
Indebtedness” means Indebtedness of the Issuer and its
Subsidiaries (other than Indebtedness under the Credit Agreement) in existence
on the date of this Indenture.

 

“Fixed Charge
Coverage Ratio” means, with respect to any Person for any
period consisting of such Person and its Restricted Subsidiaries’ most recently
ended four fiscal quarters for which internal financial statements are
available, the ratio of EBITDA of such Person for such period to the Fixed
Charges of such Person for such period. In the event that the Issuer or any
Restricted Subsidiary incurs, assumes, guarantees or redeems any Indebtedness
or issues or repays Disqualified Stock or Preferred Stock subsequent to the
commencement of the period for which the Fixed Charge Coverage Ratio is being
calculated but prior to the event for which the calculation of the Fixed Charge
Coverage Ratio is made (the “Calculation Date”),
then the Fixed Charge Coverage Ratio shall be calculated giving pro forma effect
to such incurrence, assumption, guarantee or repayment of Indebtedness, or such
issuance or redemption of Disqualified Stock or Preferred Stock, as if the same
had occurred at the beginning of the applicable four-quarter period. For
purposes of making the computation referred to above, Investments,
acquisitions, dispositions, mergers or consolidations (as determined in accordance
with GAAP) that have been made by the Issuer or any Restricted Subsidiary
during the four-quarter reference period or subsequent to such reference period
and on or prior to or simultaneously with the Calculation Date shall be
calculated on a
pro forma basis assuming that all such Investments, acquisitions,
dispositions, mergers or consolidations (and the change in any associated fixed
charge obligations and the change in EBITDA resulting therefrom) had occurred
on the first day of the four-quarter reference period. If since the beginning
of such period any Person (that subsequently became a Restricted Subsidiary or
was merged with or into the Issuer or any Restricted Subsidiary since the
beginning of such period) shall have made any Investment, acquisition,
disposition, merger or consolidation that would have required adjustment
pursuant to this definition, then the Fixed Charge Coverage Ratio shall be
calculated giving pro
forma effect thereto for such period as if such Investment,
acquisition, disposition, merger or consolidation had occurred at the beginning
of the applicable four-quarter period.

 

13

 

For purposes
of this definition, whenever pro forma effect is to be given to an
Investment, acquisition, disposition, merger or consolidation (including the
Transactions and the related restructuring initiatives) and the amount of
income or earnings relating thereto, the pro forma calculations shall be determined
in good faith by a responsible financial or accounting officer of the Issuer
and shall comply with the requirements of Rule 11-02 of Regulation S-X
promulgated by the Commission, except that such pro forma calculations may include
operating expense reductions for such period resulting from such transaction
that is being given pro
forma effect that have been realized or (A) for which the steps
necessary for realization have been taken (or are taken concurrently with such
transaction) or (B) with respect to any transactions other than the Transaction
(and the related restructuring initiatives), for which the steps necessary for
realization are reasonably expected to be taken within the six-month period
following such transaction and, in each case, including, but not limited to,
(a) reduction in personnel expenses, (b) reduction of costs related to
administrative functions, (c) reduction of costs related to leased or owned
properties and (d) reductions from the consolidation of operations and
streamlining of corporate and record label overhead; provided that, in either case, such
adjustments are set forth in an Officers’ Certificate signed by the Issuer’s
chief financial officer and another Officer which states (i) the amount of such
adjustment or adjustments, (ii) that such adjustment or adjustments are based
on the reasonable good faith beliefs of the Officers executing such Officers’
Certificate at the time of such execution and (iii) that any related incurrence
of Indebtedness is permitted pursuant to this Indenture. If any Indebtedness
bears a floating rate of interest and is being given pro forma effect, the interest on such
Indebtedness shall be calculated as if the rate in effect on the Calculation
Date had been the applicable rate for the entire period (taking into account
any Hedging Obligations applicable to such Indebtedness). 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
Issuer to be the rate of interest implicit in such Capitalized Lease Obligation
in accordance with GAAP. For purposes of making the computation referred to
above, 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. Interest on Indebtedness that 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 rate, shall be deemed to have been
based upon the rate actually chosen, or, if none, then based upon such optional
rate chosen as the Issuer may designate.

 

“Fixed Charges” means,
with respect to any Person for any period, the sum of, without duplication, (a)
Consolidated Interest Expense (excluding all noncash interest expense and
amortization/accretion of original issue discount in connection with the
Specified Financings (including any original issue discount created by fair
value adjustments to the Issuer’s existing Indebtedness as a result of purchase
accounting)) of such Person for such period, (b) all cash dividends paid,
accrued and/or scheduled to be paid or accrued during such period (excluding
items eliminated in consolidation) on any series of Preferred Stock of such

 

14

 

Person and (c) all cash
dividends paid, accrued and/or scheduled to be paid or accrued during such
period (excluding items eliminated in consolidation) on any series of
Disqualified Stock.

 

“Foreign
Subsidiary” means any Subsidiary of the Issuer that is not a
Domestic Subsidiary.

 

“GAAP” means generally accepted accounting
principles in the United States in effect on the date of this Indenture. For
purposes of this Indenture, the term “consolidated”
with respect to any Person means such Person consolidated with its
Restricted Subsidiaries and does not include any Unrestricted Subsidiary.

 

“Global Security”
has the meaning set forth in Section 2.16.

 

“Government
Securities” means, in the case of the Dollar Securities, U.S.
Government Securities and, in the case of the Sterling Securities, U.K.
Government Securities.

 

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

 

“Guarantee” means
any guarantee of the obligations of the Issuer under this Indenture and the
Securities by a Guarantor in accordance with the provisions of this Indenture.
When used as a verb, “Guarantee” shall
have a corresponding meaning.

 

“Guarantor” means
any Person that incurs a Guarantee of the Securities; provided that upon
the release and discharge of such Person from its Guarantee in accordance with
this Indenture, such Person shall cease to be a Guarantor.

 

“Guarantor Senior
Debt” means, with respect to any Guarantor, the principal of,
premium, if any, and interest (including any interest accruing subsequent to
the filing of a petition of bankruptcy at the rate provided for in the
documentation with respect thereto, whether or not such interest is an allowed
or allowable claim under applicable law) on any Indebtedness and any
Securitization Repurchase Obligation of such Guarantor, whether outstanding on
the Issue Date or thereafter created, incurred or assumed, unless, in the case
of any particular obligation, the instrument creating or evidencing the same or
pursuant to which the same is outstanding expressly provides that such
obligation shall not be senior in right of payment to the Guarantee of such
Guarantor. Without limiting the generality of the foregoing, “Guarantor Senior
Debt” shall also include the principal of, premium, if any, interest (including
any interest accruing subsequent to the filing of a petition of bankruptcy at
the rate provided for in the documentation with respect thereto, whether or not
such interest is an allowed 

 

15

 

or allowable claim under
applicable law) on, and all other amounts owing in respect of (including
guarantees of the foregoing obligations):

 

(1)           all monetary obligations of every
nature of such Guarantor under, or with respect to, the Credit Agreement,
including, without limitation, obligations to pay principal, premium and
interest, reimbursement obligations under letters of credit, fees, expenses and
indemnities (and guarantees thereof); and

 

(2)           all Hedging Obligations (and guarantees
thereof),

 

in each case whether
outstanding on the Issue Date or thereafter incurred.

 

Notwithstanding
the foregoing, “Guarantor Senior Debt” shall not include:

 

(1)           any Indebtedness of such Guarantor to
a Subsidiary of such Guarantor (other than any Securitization Repurchase
Obligation);

 

(2)           Indebtedness to, or guaranteed on
behalf of, any shareholder, director, officer or employee of such Guarantor or
any Subsidiary of such Guarantor (including, without limitation, amounts owed
for compensation) other than the guarantee of Holdco of Indebtedness under the
Credit Agreement;

 

(3)           Indebtedness to trade creditors and
other amounts incurred in connection with obtaining goods, materials or
services (including guarantees thereof or instruments evidencing such
liabilities);

 

(4)           Indebtedness represented by Capital
Stock;

 

(5)           any liability for federal, state,
local or other taxes owed or owing by such Guarantor;

 

(6)           that portion of any Indebtedness
incurred in violation of Section 4.10;

 

(7)           Indebtedness which, when incurred and
without respect to any election under Section 1111(b) of Title 11, United
States Code, is without recourse to the Issuer; and

 

(8)           any Indebtedness which is, by its
express terms, subordinated in right of payment to any other Indebtedness of
such Guarantor.

 

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

 

16

 

(1)           currency exchange, interest rate or
commodity swap agreements, currency exchange, interest rate or commodity cap
agreements and currency exchange, interest rate or commodity collar agreements;
and

 

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

 

“Holdco” means
WMG Holdings Corp., a Delaware corporation and the direct parent of the Issuer.

 

“Holder” or
“Securityholder” means the
registered holder of any Security.

 

“incur” means
to directly or indirectly create, incur, issue, assume, guarantee or otherwise
become directly or indirectly liable, contingently or otherwise, with respect
to any Indebtedness (including Acquired Debt) and “incurrence” shall have a correlative meaning.

 

“Indebtedness” means,
with respect to any Person,

 

(a)           any indebtedness
(including principal and premium) of such Person, whether or not contingent,

 

(i)            in respect of borrowed money,

 

(ii)           evidenced by bonds, notes, debentures
or similar instruments or letters of credit (or, without double counting,
reimbursement agreements in respect thereof),

 

(iii)          representing the balance deferred and
unpaid of the purchase price of any property (including Capitalized Lease
Obligations), except any such balance that constitutes a trade payable or
similar obligation to a trade creditor, in each case accrued in the ordinary
course of business or

 

(iv)          representing any Hedging Obligations,

 

if and to the
extent that any of the foregoing Indebtedness (other than letters of credit and
Hedging Obligations) would appear as a liability upon a balance sheet
(excluding the footnotes thereto) of such Person prepared in accordance with
GAAP,

 

(b)           Disqualified Stock
of such Person,

 

(c)           to the extent not
otherwise included, any obligation by such Person to be liable for, or to pay,
as obligor, guarantor or otherwise, the Indebtedness of another

 

17

 

Person (other
than by endorsement of negotiable instruments for collection in the ordinary
course of business) and

 

(d)           to the extent not
otherwise included, Indebtedness of another Person secured by a Lien on any
asset owned by such Person (whether or not such Indebtedness is assumed by such
Person);

 

provided, however, that
Contingent Obligations incurred in the ordinary course of business and not in
respect of borrowed money shall be deemed not to constitute Indebtedness.

 

“Indenture” means
this Indenture, as amended,
restated or supplemented from time to time in accordance with the terms hereof.

 

“Independent
Financial Advisor” means an accounting, appraisal or
investment banking firm or consultant to Persons engaged in a Permitted
Business of nationally recognized standing that is, in the good faith judgment
of the Issuer, qualified to perform the task for which it has been engaged.

 

“Initial Purchasers”
means with respect to the Dollar Securities, Deutsche Bank
Securities Inc., Banc of America Securities LLC, Lehman Brothers Inc. and
Merrill Lynch, Pierce, Fenner & Smith Incorporated and with respect to the
Sterling Securities, Deutsche Bank AG London, Bank of America Securities
Limited, Lehman Brothers International and Merrill Lynch International and such
other initial purchasers party to the Securities Purchase Agreement entered
into in connection with the offer and sale of the Securities.

 

“Interest” means,
with respect to the Securities, interest and any Additional Interest on the
Securities.

 

“Interest Payment
Date” means the stated maturity of an installment of interest
on the Securities.

 

“Investments” means,
with respect to any Person, all direct or indirect investments by such Person
in other Persons (including Affiliates) in the forms of loans (including
guarantees or other obligations), advances or capital contributions (excluding
accounts receivable, trade credit, advances to customers, commission, travel
and similar advances to officers and employees, in each case made in the
ordinary course of business), purchases or other acquisitions for consideration
of Indebtedness, Equity Interests or other securities issued by any other
Person and investments that are required by GAAP to be classified on the
balance sheet (excluding the footnotes) of such Person in the same manner as
the other investments included in this definition to the extent such
transactions involve the transfer of cash or other property. If the Issuer or
any Subsidiary of the Issuer sells or otherwise disposes of any Equity
Interests of any direct or indirect Subsidiary of the Issuer such that, after
giving effect to any such sale or disposition, such Person is no longer a Subsidiary
of the Issuer, the Issuer

 

18

 

will be deemed to have made an
Investment on the date of any such sale or disposition equal to the fair market
value of the Equity Interests of such Subsidiary not sold or disposed of in an
amount determined as provided in Section 4.11(c).

 

For purposes
of the definition of “Unrestricted Subsidiary” and Section 4.11, (i) “Investments”
shall include the portion (proportionate to the Issuer’s equity interest in
such Subsidiary) of the fair market value of the net assets of a Subsidiary of
the Issuer at the time that such Subsidiary is designated an Unrestricted
Subsidiary, provided, however, that upon a redesignation of
such Subsidiary as a Restricted Subsidiary, the Issuer shall be deemed to
continue to have a permanent “Investment” in an Unrestricted Subsidiary in an
amount (if positive) equal to (x) the Issuer’s “Investment” in such Subsidiary
at the time of such redesignation less (y) the portion (proportionate to the
Issuer’s equity interest in such Subsidiary) of the fair market value of the
net assets of such Subsidiary at the time of such redesignation; (ii) any
property transferred to or from an Unrestricted Subsidiary shall be valued at
its fair market value at the time of such transfer, in each case as determined
in good faith by the Issuer; and (iii) any transfer of Capital Stock that
results in an entity which became a Restricted Subsidiary after the Issue Date
ceasing to be a Restricted Subsidiary shall be deemed to be an Investment in an
amount equal to the fair market value (as determined by the Board of Directors
of the Issuer in good faith as of the date of initial acquisition) of the
Capital Stock of such entity owned by the Issuer and the Restricted Subsidiaries
immediately after such transfer.

 

“Issue Date” means
April 8, 2004, the date of original issuance of the Securities.

 

“Lien” means,
with respect to any asset, any mortgage, lien, pledge, charge, security
interest or encumbrance of any kind in respect of such asset, whether or not
filed, recorded or otherwise perfected under applicable law, including any
conditional sale or other title retention agreement, any lease in the nature
thereof, any option or other agreement to sell or give a security interest in
and any filing of or agreement to give any financing statement under the
Uniform Commercial Code (or equivalent statutes) of any jurisdiction; provided that in
no event shall an operating lease be deemed to constitute a Lien.

 

“Luxembourg
Paying Agent” has the meaning set forth in Section 2.04.

 

“Management
Agreement” means the Management Agreement by and among the
Issuer, Holdco and the Sponsors and/or their Affiliates as in effect on the
Issue Date.

 

“Maturity Date” means
April 15, 2014.

 

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

 

19

 

“Net Income” means,
with respect to any Person, the net income (loss) of such Person, determined in
accordance with GAAP and before any reduction in respect of Preferred Stock
dividends or accretion of any Preferred Stock.

 

“Net Indebtedness
to EBITDA Ratio” means, with respect to any Person, the ratio
of: (a) the Indebtedness (which, for purposes of any calculations of the Net
Indebtedness to EBITDA Ratio, shall include, without duplication, any Qualified
Securitization Financing, Non-Recourse Acquisition Financing Indebtedness and
Non-Recourse Product Financing Indebtedness) of the Issuer and its Restricted
Subsidiaries, as of the end of the most recently ended fiscal quarter, plus the
amount of any Indebtedness incurred subsequent to the end of such fiscal
quarter, less the amount of cash and Cash Equivalents that would be stated on
the balance sheet of the Issuer and held by the Issuer as of such date of
determination, as determined in accordance with GAAP, to (b) the Issuer’s
EBITDA for the most recently ended four full fiscal quarters for which internal
financial statements are available immediately preceding the date on which such
event for which such calculation is being made shall occur (the “Measurement Period”); provided, however, that:
(i) in making such computation, Indebtedness shall include the greater of (x)
the average daily balance outstanding under any revolving credit facility
during the most recently ended fiscal quarter and (y) the actual amount of
Indebtedness outstanding under any revolving credit facility as of the date for
which such calculation is being made; and (ii) if the Issuer or any of its
Restricted Subsidiaries consummates a material acquisition or an Asset Sale or
other disposition of assets subsequent to the commencement of the Measurement
Period but prior to the event for which the calculation of the Net Indebtedness
to EBITDA Ratio is made, then the Net Indebtedness to EBITDA Ratio shall be
calculated giving pro
forma effect to such material acquisition or Asset Sale or other
disposition of assets as if the same had occurred at the beginning of the
applicable period. Any pro forma calculations necessary pursuant to this “Net
Indebtedness to EBITDA Ratio” shall be made in accordance with the provisions
set forth in the second paragraph of the definition of “Fixed Charge Coverage
Ratio.”

 

“Net Proceeds” means
the aggregate cash proceeds received by the Issuer or any Restricted Subsidiary
in respect of any Asset Sale, including, without limitation, legal, accounting
and investment banking fees, and brokerage and sales commissions, any
relocation expenses incurred as a result thereof, taxes paid or payable as a
result thereof (after taking into account any available tax credits or
deductions and any tax sharing arrangements), repayment of Indebtedness that is
secured by the property or assets that are the subject of such Asset Sale and
any deduction of appropriate amounts to be provided by the Issuer as a reserve
in accordance with GAAP against any liabilities associated with the asset
disposed of in such transaction and retained by the Issuer after such sale or
other disposition thereof, including, without limitation, pension and other
post-employment benefit liabilities and liabilities related to environmental
matters or against any indemnification obligations associated with such
transaction.

 

20

 

“Net Senior
Indebtedness to EBITDA Ratio” means, with respect to any
Person, the ratio of (a) the Senior Debt (which, for purposes of any
calculations of the Net Senior Indebtedness to EBITDA Ratio, shall include,
without duplication, to the extent constituting Senior Debt, any Qualified
Securitization Financing, Non-Recourse Acquisition Financing Indebtedness and
Non-Recourse Product Financing Indebtedness) of the Issuer and its Restricted
Subsidiaries, as of the end of the most recently ended fiscal quarter, plus the
amount of any Senior Debt incurred subsequent to the end of such fiscal
quarter, less the amount of cash and Cash Equivalents that would be stated on
the balance sheet of the Issuer and held by the Issuer as of such date of
determination, as determined in accordance with GAAP, to (b) the Issuer’s
EBITDA for the most recently ended four full fiscal quarters for which internal
financial statements are available immediately preceding the date on which such
event for which such calculation is being made shall occur (the “Measurement
Period”); provided, however, that: (i) in making
such computation, Senior Debt shall include the greater of (x) the average
daily balance outstanding under any revolving credit facility during the most
recently ended fiscal quarter and (y) the actual amount of Indebtedness
outstanding under any revolving credit facility as of the date for which such
calculation is being made; and (ii) if the Issuer or any of its Restricted
Subsidiaries consummates a material acquisition or an Asset Sale or other
disposition of assets subsequent to the commencement of the Measurement Period
but prior to the event for which the calculation of the Net Senior Indebtedness
to EBITDA Ratio is made, then the Net Senior Indebtedness to EBITDA Ratio shall
be calculated giving pro
forma effect to such material acquisition or Asset Sale or other
disposition of assets, as if the same had occurred at the beginning of the
applicable period. Any pro forma calculations necessary pursuant to this “Net Senior
Indebtedness to EBITDA Ratio” shall be made in accordance with the provisions
set forth in the second paragraph of the definition of “Fixed Charge Coverage
Ratio.”

 

“Non-Recourse
Acquisition Financing Indebtedness” means any Indebtedness
incurred by the Issuer or any Restricted Subsidiary to finance the acquisition,
exploitation or development of assets (including directly or through the
acquisition of entities holding such assets) not owned by the Issuer or any of
its Restricted Subsidiaries prior to such acquisition, exploitation or
development, which assets are used for the creation or development of Product
for the benefit of the Issuer, and in respect of which the Person to whom such
Indebtedness is owed has no recourse whatsoever to the Issuer or any of its
Restricted Subsidiaries for the repayment of or payment of such Indebtedness
other than recourse to the acquired assets or assets that are the subject of
such exploitation or development for the purpose of enforcing any Lien given by
the Issuer or such Restricted Subsidiary over such assets, including the
receivables, inventory, intangibles and other rights associated with such
assets and the proceeds thereof.

 

“Non-Recourse
Product Financing Indebtedness” means any Indebtedness
incurred by the Issuer or any Restricted Subsidiary solely for the purpose of
financing (whether directly or through a partially-owned joint venture) the
production, acquisition, exploitation,

 

21

 

creation or development of
items of Product produced, acquired, exploited, created or developed after the
Issue Date (including any Indebtedness assumed in connection with the
production, acquisition, creation or development of any such items of Product
or secured by a Lien on any such items of Product prior to the production,
acquisition, creation or development thereof) where the recourse of the
creditor in respect of that Indebtedness is limited to Product revenues
generated by such items of Product or any
rights pertaining thereto and where the Indebtedness is unsecured save
for Liens over such items of Product or revenues and such rights and any
extension, renewal, replacement or refinancing of such Indebtedness. “Non-Recourse
Product Financing Indebtedness” excludes, for the avoidance of doubt, any
Indebtedness raised or secured against Product where the proceeds are used for
any other purposes.

 

“Non-U.S. Person”
has the meaning assigned to such term in Regulation S.

 

“Obligations” means
any principal, interest, penalties, fees, indemnifications, reimbursements
(including, without limitation, reimbursement obligations with respect to
letters of credit), damages and other liabilities, and guarantees of payment of
such principal, interest, penalties, fees, indemnifications, reimbursements,
damages and other liabilities, payable under the documentation governing any
Indebtedness.

 

“Offering
Memorandum” means the offering memorandum of the Issuer dated
April 1, 2004 relating to the Securities.

 

“Officer” means the Chairman of the Board, the
Chief Executive Officer, the Chief Financial Officer, the President, any
Executive Vice President, Senior Vice President or Vice President, the
Treasurer or the Secretary or Assistant Secretary or General Counsel or Deputy
General Counsel of the Issuer.

 

“Officers’ Certificate” means a certificate
signed on behalf of the Issuer by two Officers of the Issuer, one of whom is
the principal executive officer, the principal financial officer, the treasurer
or the principal accounting officer of the Issuer, that meets the requirements
set forth in this Indenture.

 

“Opinion of
Counsel” means a written opinion from legal counsel who is
reasonably acceptable to the Trustee. The counsel may be an employee of or
counsel to the Issuer, a Guarantor or the Trustee.

 

“Permitted Asset
Swap” means any transfer of property or assets by the Issuer
or any of its Restricted Subsidiaries in which at least 90% of the
consideration received by the transferor consists of properties or assets
(other than cash) that will be used in a Permitted Business; provided that the aggregate fair market
value of the property or assets being transferred by the Issuer or such
Restricted Subsidiary is not greater than the aggregate fair market value of the
property or assets received by the Issuer or such Restricted Subsidiary in

 

22

 

such exchange (provided, however, that
in the event such aggregate fair market value of the property or assets being
transferred or received by the Issuer is (x) less than $50.0 million, such
determination shall be made in good faith by the Board of Directors of the
Issuer and (y) greater than or equal to $50.0 million, such determination shall
be made by an Independent Financial Advisor).

 

“Permitted
Business” means the media and entertainment business and any
services, activities or businesses incidental or directly related or similar
thereto, any line of business engaged in by the Issuer on the Issue Date or any
business activity that is a reasonable extension, development or expansion
thereof or ancillary thereto.

 

“Permitted Debt” is
defined in Section 4.10(b).

 

“Permitted
Holders” means (i) the Sponsors and their Affiliates (not
including, however, any portfolio companies of any of the Sponsors); (ii) Edgar
Bronfman Jr.; (iii) immediate family members (including spouses and direct
descendants) of the Person described in clause (ii); (iv) any trusts created
for the benefit of the Person described in clause (ii) or (iii) or any trust
for the benefit of any such trust; (v) in the event of the incompetence or
death of any Person described in clauses
(ii) and (iii), such Person’s estate, executor, administrator, committee or
other personal representative or beneficiaries, in each case who at any
particular date shall beneficially own or have the right to acquire, directly
or indirectly, Capital Stock of the Issuer; or (vi) Time Warner Inc. if at such
time as Time Warner Inc. owns 50% or more of the total voting power of the
Voting Stock of the Issuer or any direct or indirect parent company of the
Issuer and after giving pro forma effect to the acquisition of such Voting Stock and
the incurrence of any Indebtedness used to finance the acquisition thereof, (x)
Time Warner Inc. has a rating of at least “investment grade” status from
S&P and Moody’s and (y) neither S&P, Moody’s nor any other nationally
recognized rating agency shall have downgraded, or indicated an intention to
downgrade, the corporate rating of Time Warner Inc. to a level below its then
existing corporate rating by any such agency.

 

“Permitted
Investments” means

 

(1)           any Investment by the Issuer in any
Restricted Subsidiary or by a Restricted Subsidiary in another Restricted
Subsidiary;

 

(2)           any Investment in
cash and Cash Equivalents;

 

(3)           any Investment by the Issuer or any
Restricted Subsidiary of the Issuer in a Person that is engaged in a Permitted
Business if as a result of such Investment (A) such Person becomes a Restricted
Subsidiary or (B) such Person, in one transaction or a series of related transactions,
is merged, consolidated or amalgamated with or into, or transfers or conveys
substantially all of its assets to, or is liquidated into, the Issuer or a
Restricted Subsidiary;

 

23

 

(4)           any Investment in securities or other
assets not constituting cash or Cash Equivalents and received in connection
with an Asset Sale made pursuant to Section 4.13 or any other disposition of
assets not constituting an Asset Sale;

 

(5)           any Investment
existing on the Issue Date and any modification, replacement, renewal or
extension thereof; provided that the amount of any such
Investment may be increased (x) as required by the terms of such Investment as
in existence on the Issue Date or (y) as otherwise permitted under this
Indenture;

 

(6)           loans and advances
to employees and any guarantees not in excess of $15.0 million in the aggregate
outstanding at any one time;

 

(7)           any Investment
acquired by the Issuer or any Restricted Subsidiary (A) in exchange for any
other Investment or accounts receivable held by the Issuer or any such
Restricted Subsidiary in connection with or as a result of a bankruptcy,
workout, reorganization or recapitalization of the issuer of such other
Investment or accounts receivable or (B) as a result of a foreclosure by the
Issuer or any Restricted Subsidiary with respect to any secured Investment or
other transfer of title with respect to any secured Investment in default;

 

(8)           Hedging Obligations permitted under
clause (9) of the definition of “Permitted Debt” in Section 4.10(b);

 

(9)           loans and advances
to officers, directors and employees for business-related travel expenses,
moving expenses and other similar expenses, in each case incurred in the
ordinary course of business;

 

(10)         any advance directly
or indirectly related to royalties or future profits (whether or not recouped),
directly or indirectly (including through capital contributions or loans to an
entity or joint venture relating to such artist(s) or writer(s)), to one or
more artists or writers pursuant to label and license agreements, agreements
with artists/writers and related ventures, pressing and distribution
agreements, publishing agreements and any similar contract or agreement entered
into from time to time in the ordinary course of business;

 

(11)         any Investment by the Issuer or a
Restricted Subsidiary in a Permitted Business having an aggregate fair market
value, taken together with all other Investments made pursuant to this clause
(11) that are at that time outstanding (without giving effect to the sale of an
Unrestricted Subsidiary to the extent the proceeds of such sale do not consist
of cash and/or marketable securities), not to exceed the greater of $75.0
million and 8.0% of Consolidated Tangible Assets (with the fair market value of
each Investment being measured at the time made and without giving effect to
subsequent changes in value);

 

24

 

(12)         Investments the payment for which
consists of Equity Interests of the Issuer or any of its direct or indirect
parent corporations (exclusive of Disqualified Stock);

 

(13)         guarantees (including
Guarantees) of Indebtedness permitted under Section 4.10 and performance
guarantees consistent with past practice;

 

(14)         any transaction to
the extent it constitutes an Investment that is permitted and made in
accordance with Section 4.14 (except transactions described in clauses (2), (6)
and (7) of Section 4.14(b));

 

(15)         Investments by the Issuer or a
Restricted Subsidiary in joint ventures engaged in a Permitted Business having
an aggregate fair market value, taken together with all other Investments made
pursuant to this clause (15) that are at that time outstanding amount, not to
exceed the greater of $50.0 million and 4.0% of Consolidated Tangible Assets
(with the fair market value of each Investment being measured at the time made
and without giving effect to subsequent changes in value);

 

(16)         Investments
consisting of licensing or contribution of intellectual property pursuant to
joint marketing arrangements with other Persons; and

 

(17)         any Investment in a
Securitization Subsidiary or any Investment by a Securitization Subsidiary in
any other Person in connection with a Qualified Securitization Financing,
including Investments of funds held in accounts permitted or required by the
arrangements governing such Qualified Securitization Financing or any related
Indebtedness; provided, however, that any Investment in a
Securitization Subsidiary is in the form of a Purchase Money Note, contribution
of additional Securitization Assets or an equity interest.

 

“Permitted Junior
Securities” means:

 

(1)           Equity Interests in
the Issuer, any Guarantor or any direct or indirect parent of the Issuer; or

 

(2)           unsecured debt securities that are
subordinated to all Senior Debt (and any debt securities issued in exchange for
Senior Debt) to substantially the same extent as, or to a greater extent than,
the Securities and the Guarantees are subordinated to Senior Debt under this
Indenture.

 

“Permitted Liens”
means the following types of Liens:

 

(1)           deposits of cash or
government bonds made in the ordinary course of business to secure surety or
appeal bonds to which such Person is a party;

 

25

 

(2)           Liens in favor of issuers of
performance, surety, bid, indemnity, warranty, release, appeal or similar bonds
or with respect to other regulatory requirements or letters of credit or
bankers’ acceptances issued, and completion guarantees provided for, in each
case pursuant to the request of and for the account of such Person in the
ordinary course of its business or consistent with past practice;

 

(3)           Liens on property or shares of stock
of a Person at the time such Person becomes a Subsidiary; provided, however, that such Liens are not
created or incurred in connection with, or in contemplation of, such other
Person becoming such a Subsidiary; provided, further, however, that such Liens may not
extend to any other property owned by the Issuer or any Restricted Subsidiary;

 

(4)           Liens on property at the time the
Issuer or a Restricted Subsidiary acquired the property, including any
acquisition by means of a merger or consolidation with or into the Issuer or
any Restricted Subsidiary; provided,
however, that such Liens are not created or incurred in connection
with, or in contemplation of, such acquisition; provided, further, however, that such Liens may not extend
to any other property owned by the Issuer or any Restricted Subsidiary;

 

(5)           Liens securing Indebtedness or other
obligations of a Restricted Subsidiary owing to the Issuer or another
Restricted Subsidiary permitted to be incurred in accordance with Section 4.10;

 

(6)           Liens securing Hedging Obligations so
long as the related Indebtedness is permitted to be incurred under this
Indenture and is secured by a Lien on the same property securing such Hedging
Obligation;

 

(7)           Liens on 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;

 

(8)           Liens in favor of
the Issuer or any Restricted Subsidiary;

 

(9)           Liens to secure any
Indebtedness that is incurred to refinance any Indebtedness that has been
secured by a Lien existing on the Issue Date or referred to in clauses (3), (4)
and (19)(B) of this definition; provided,
however, that such Liens (x) are no less favorable to the Holders
and are not more favorable to the lienholders with respect to such Liens than
the Liens in respect of the Indebtedness being refinanced; and (y) do not
extend to or cover any property or assets of the Issuer or any of its
Restricted Subsidiaries
not securing the Indebtedness so refinanced;

 

26

 

(10)         Liens on Securitization Assets and
related assets of the type specified in the definition of “Securitization
Financing” incurred in connection with any Qualified Securitization Financing;

 

(11)         Liens for taxes,
assessments or other governmental charges or levies not yet delinquent, or
which are being contested in good faith by appropriate proceedings promptly
instituted and diligently conducted or for property taxes on property that the
Issuer or one of its Subsidiaries has determined to abandon if the sole
recourse for such tax, assessment, charge, levy or claim is to such property;

 

(12)         judgment liens in respect of judgments
that do not constitute an Event of Default so long as such Liens are adequately
bonded and any appropriate legal proceedings that may have been duly initiated
for the review of such judgment have not been finally terminated or the period
within which such proceedings may be initiated has not expired;

 

(13)         pledges, deposits or
security under workmen’s compensation, unemployment insurance and other social
security laws or regulations, or deposits to secure the performance of tenders,
contracts (other than for the payment of Indebtedness) or leases, or deposits
to secure public or statutory obligations, or deposits as security for
contested taxes or import or customs duties or for the payment of rent, or
deposits or other security securing liabilities to insurance carriers under
insurance or self-insurance arrangements, in each case incurred in the ordinary
course of business or consistent with past practice;

 

(14)         Liens imposed by law,
including carriers’, warehousemen’s, materialmen’s, repairmen’s and mechanics’
Liens, in each case for sums not overdue by more than 30 days or, if more than
30 days overdue, are unfiled and no other action has been taken to enforce such
Lien or which are being contested in good faith by appropriate proceedings
promptly instituted and diligently conducted;

 

(15)         encumbrances, ground
leases, easements or reservations of, or rights of others for, licenses, rights
of way, sewers, electric lines, telegraph and telephone lines and other similar
purposes, or zoning, building codes or other restrictions (including, without
limitation, minor defects or irregularities in title and similar encumbrances)
as to the use of real properties or Liens incidental to the conduct of business
or to the ownership of properties that do not in the aggregate materially
adversely affect the value of said properties or materially impair their use in
the operation of the business;

 

(16)         leases, licenses, subleases or
sublicenses granted to others in the ordinary course of business that do not
(x) interfere in any material respect with the business of the Issuer or any of
its material Restricted Subsidiaries or (y) secure any Indebtedness;

 

27

 

(17)         banker’s Liens, rights of set-off or
similar rights and remedies as to deposit accounts or other funds maintained
with a depositary institution, provided that (a) such deposit account is
not a dedicated cash collateral account and is not subject to restrictions
against access by the Issuer in excess of those set forth by regulations
promulgated by the Federal Reserve Board or other applicable law and (b) such
deposit account is not intended by the Issuer or any Restricted Subsidiary to
provide collateral to the depositary institution;

 

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

 

(19)         (A) other Liens securing Indebtedness
for borrowed money with respect to property or assets with an aggregate fair
market value (valued at the time of creation thereof) of not more than $15.0
million at any time and (B) Liens securing Indebtedness incurred to finance the
construction, purchase or lease of, or repairs, improvements or additions to,
property of such Person; provided, however, that (x) the Lien may
not extend to any other property (except for accessions to such property) owned
by such Person or any of its Restricted Subsidiaries at the time the Lien is
incurred, (y) such Liens attach concurrently with or within 270 days after the
acquisition, repair, replacement, construction or improvement (as applicable)
of the property subject to such Liens and (z) with respect to Capitalized Lease
Obligations, such Liens do not at any time extend to or cover any assets
(except for accessions to such assets) other than the assets subject to such
Capitalized Lease Obligations; provided that individual financings of equipment
provided by one lender may be cross-collateralized to other financings of
equipment provided by such lender;

 

(20)         Liens to secure Non-Recourse Product
Financing Indebtedness permitted to be incurred pursuant to clause (18) of the
definition of “Permitted Debt” in Section 4.10(b), which Liens may not secure
Indebtedness other than Non-Recourse Product Financing Indebtedness and which
Liens may not attach to assets other than the items of Product acquired,
exploited, created or developed with the proceeds of such Indebtedness and
Liens to secure Non-Recourse Acquisition Financing Indebtedness permitted to be
incurred pursuant to clause (18) of the definition of “Permitted Debt” in
Section 4.10(b), which Liens may not secure Indebtedness other than
Non-Recourse Acquisition Financing Indebtedness and which Liens may not attach
to assets other than the assets acquired, exploited, created or developed with
the proceeds of such Indebtedness;

 

(21)         Liens (i) of a collection bank arising
under Section 4-210 of the Uniform Commercial Code on items in the course of
collection, (ii) attaching to commodity trading accounts or other commodities
brokerage accounts incurred in the ordinary

 

28

 

course of
business and (iii) in favor of a banking institution arising as a matter of law
encumbering deposits (including the right of set-off) and which are within the
general parameters customary in the banking industry;

 

(22)         Liens encumbering
reasonable customary initial deposits and margin deposits and similar Liens
attaching to commodity trading accounts or other brokerage accounts incurred in
the ordinary course of business and not for speculative purposes;

 

(23)         Liens that are
contractual rights of set-off (i) relating to the establishment of depository
relations with banks not given in connection with the issuance of Indebtedness,
(ii) relating to pooled deposit or sweep accounts of the Issuer or any
Restricted Subsidiary to permit satisfaction of overdraft or similar
obligations incurred in the ordinary course of business of the Issuer and its
Restricted Subsidiaries or (iii) relating to purchase orders and other
agreements entered into with customers of the Issuer or any Restricted
Subsidiary in the ordinary course of business; and

 

(24)         Liens solely on any
cash earnest money deposits made by the Issuer or any of its Restricted
Subsidiaries in connection with any letter of intent or purchase agreement
permitted under this Indenture.

 

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

 

“Preferred Stock”
means any Equity Interest with preferential rights of payment
of dividends upon liquidation, dissolution or winding up.

 

“Private
Placement Legend” means the legends initially set forth on
the Dollar Securities in the form set forth in Exhibit C-1 or the
Sterling Securities in the form set forth in Exhibit C-2.

 

“Product” means
any music (including musical and audio visual recordings, musical performance,
songs and compositions and also includes mail order music and activities
relating or incidental to music such as touring, merchandising and artist
management), music copyright, motion picture, television programming, film,
videotape, digital file, video clubs, DVD manufactured or distributed or any
other product produced for theatrical, non-theatrical or television release or
for release in any other medium, in each case whether recorded on film,
videotape, cassette, cartridge, disc or on or by any other means, method,
process or device, whether now known or hereafter developed, with respect to
which the Issuer or any Restricted Subsidiary:

 

(1)           is an initial
copyright owner; or

 

29

 

(2)           acquires (or will
acquire upon delivery) an equity interest, license, sublicense or administration
or distribution right.

 

“Purchase
Agreement” means the Purchase Agreement dated November 24,
2003, as amended by the amendment to the Purchase Agreement dated February 29,
2004, between Time Warner Inc. and WMG Acquisition Corp.

 

“Purchase Money
Note” means a promissory note of a Securitization Subsidiary
evidencing a line of credit, which may be irrevocable, from Holdco or any
Subsidiary of Holdco to a Securitization Subsidiary in connection with a
Qualified Securitization Financing, which note is intended to finance that
portion of the purchase price that is not paid in cash or a contribution of
equity and which (a) shall be repaid from cash available to the Securitization
Subsidiary, other than (i) amounts required to be established as reserves, (ii)
amounts paid to investors in respect of interest, (iii) principal and other
amounts owing to such investors and (iv) amounts paid in connection with the
purchase of newly generated receivables and (b) may be subordinated to the
payments described in clause (a).

 

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

 

“Qualified
Institutional Buyer” or “QIB”
shall have the meaning specified in Rule 144A under the Securities
Act.

 

“Qualified
Proceeds” means assets that are used or useful in, or Capital
Stock of any Person engaged in, a Permitted Business; provided that
the fair market value of any such assets or Capital Stock shall be determined
by the Board of Directors of the Issuer in good faith, except that in the event
the value of any such assets or Capital Stock exceeds $25.0 million, the fair
market value shall be determined by an Independent Financial Advisor.

 

“Qualified
Securitization Financing” means any Securitization Financing
of a Securitization Subsidiary that meets the following conditions: (i) the
Board of Directors of the Issuer shall have determined in good faith that such
Qualified Securitization Financing (including financing terms, covenants,
termination events and other provisions) is in the aggregate economically fair
and reasonable to the Issuer and the Securitization Subsidiary, (ii) all sales
of Securitization Assets and related assets to the Securitization Subsidiary
are made at fair market value (as determined in good faith by the Issuer) and
(iii) the financing terms, covenants, termination events and other provisions
thereof shall be market terms (as determined in good faith by the Issuer) and
may include Standard Securitization Undertakings. The grant of a security
interest in any Securitization Assets of the Issuer or any of its Restricted
Subsidiaries (other than a Securitization Subsidiary) to secure Indebtedness
under the Credit Agreement and any Refinancing Indebtedness with respect
thereto shall not be deemed a Qualified Securitization Financing.

 

30

 

“Record Date” means
the applicable Record Date specified in the Securities; provided that if
any such date is not a Business Day, the Record Date shall be the first day
immediately preceding such specified day that is a Business Day.

 

“Redemption Date,”
when used with respect to any Security to be redeemed, means
the date fixed for such redemption pursuant to this Indenture and the
Securities.

 

“Redemption
Price,” when used with respect to any Security to be
redeemed, means the price fixed for such redemption, payable in immediately
available funds, pursuant to this Indenture and the Securities.

 

“refinance” means
to extend, refinance, renew, replace, defease or refund, including successively;
and “refinancing” and “refinanced” shall have correlative
meanings.

 

“Registration
Rights Agreement” means (a) the Registration Rights Agreement
dated as of April 8, 2004, among the Issuer, the Guarantors and the Initial
Purchasers relating to the Securities and (b) any other similar Exchange and
Registration Rights Agreement relating to Additional Securities.

 

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

 

“Representative” means
the trustee, agent or representative (if any) for an issue of Senior Debt of
the Issuer.

 

“Responsible
Officer” means, when used with respect to the Trustee, any
officer in the Corporate Trust Office of the Trustee to whom any corporate
trust matter is referred because of such officer’s knowledge of and familiarity
with the particular subject and shall also mean any officer who shall have
direct responsibility for the administration of this Indenture.

 

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

 

“Restricted
Security” means a Security that constitutes a “Restricted
Security” within the meaning of Rule 144(a)(3) under the Securities Act; provided, however, that
the Trustee shall be entitled to request and conclusively rely on an Opinion of
Counsel with respect to whether any Security constitutes a Restricted Security.

 

“Restricted
Subsidiary” means, at any time, any direct or indirect
Subsidiary of the Issuer (including any Foreign Subsidiary) that is not then an
Unrestricted Subsidiary; provided, however, that upon the occurrence of an
Unrestricted Subsidiary ceasing to be an Unrestricted Subsidiary, such
Subsidiary shall be included in the definition of “Restricted Subsidiary”.

 

31

 

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

 

“S&P” means
Standard & Poor’s Ratings Services, a division of The McGraw-Hill Companies,
Inc.

 

“Secured
Indebtedness” means any Indebtedness secured by a Lien.

 

“Securities” means
the Dollar Securities and the Sterling Securities.

 

“Securities Act” means
the Securities Act of 1933, as amended, and the rules and regulations of the
Commission promulgated thereunder.

 

“Securities
Purchase Agreement” means (a) the Purchase Agreement dated
April 1, 2004, among the Issuer, the Guarantors and the Initial Purchasers and
(b) any other similar purchase agreement relating to the Additional Securities.

 

“Securitization
Assets” means any accounts receivable or catalog, royalty or
other revenue streams from Product subject to a Qualified Securitization
Financing.

 

“Securitization
Fees” means reasonable distributions or payments made
directly or by means of discounts with respect to any participation interest
issued or sold in connection with, and other fees paid to a Person that is not
a Securitization Subsidiary in connection with, any Qualified Securitization
Financing.

 

“Securitization
Financing” means any transaction or series of transactions
that may be entered into by Holdco or any of its Subsidiaries pursuant to which
Holdco or any of its Subsidiaries may sell, convey or otherwise transfer to (a)
a Securitization Subsidiary (in the case of a transfer by Holdco or any of its
Subsidiaries) and (b) any other Person (in the case of a transfer by a
Securitization Subsidiary), or may grant a security interest in, any Securitization
Assets (whether now existing or arising in the future) of Holdco or any of its
Subsidiaries, and any assets related thereto including, without limitation, all
collateral securing such Securitization Assets, all contracts and all
guarantees or other obligations in respect of such Securitization Assets,
proceeds of such Securitization Assets and other assets which are customarily
transferred or in respect of which security interests are customarily granted
in connection with asset securitization transactions involving Securitization
Assets and any Hedging Obligations entered into by Holdco or any such
Subsidiary in connection with such Securitization Assets.

 

“Securitization
Repurchase Obligation” means any obligation of a seller of
Securitization Assets in a Qualified Securitization Financing to repurchase
Securitization Assets arising as a result of a breach of a representation,
warranty or covenant or otherwise, including as a result of a receivable or
portion thereof becoming subject to any asserted defense,

 

32

 

dispute, offset or counterclaim
of any kind as a result of any action taken by, any failure to take action by
or any other event relating to the seller.

 

“Securitization
Subsidiary” means a Wholly Owned Subsidiary of Holdco (or
another Person formed for the purposes of engaging in a Qualified
Securitization Financing in which Holdco or any Subsidiary of Holdco makes an
Investment and to which Holdco or any Subsidiary of Holdco transfers Securitization
Assets and related assets) which engages in no activities other than in
connection with the financing of Securitization Assets of Holdco or its
Subsidiaries, all proceeds thereof and all rights (contractual and other),
collateral and other assets relating thereto, and any business or activities
incidental or related to such business, and which is designated by the Board of
Directors of Holdco or such other Person (as provided below) as a
Securitization Subsidiary and (a) no portion of the Indebtedness or any other
obligations (contingent or otherwise) of which (i) is guaranteed by Holdco or
any other Subsidiary of Holdco (excluding guarantees of obligations (other than
the principal of, and interest on, Indebtedness) pursuant to Standard
Securitization Undertakings), (ii) is recourse to or obligates Holdco or any
other Subsidiary of Holdco in any way other than pursuant to Standard
Securitization Undertakings or (iii) subjects any property or asset of Holdco
or any other Subsidiary of Holdco, directly or indirectly, contingently or
otherwise, to the satisfaction thereof, other than pursuant to Standard
Securitization Undertakings, (b) with which neither Holdco nor any other
Subsidiary of Holdco has any material contract, agreement, arrangement or understanding
other than on terms which Holdco reasonably believes to be no less favorable to
Holdco or such Subsidiary than those that might be obtained at the time from
Persons that are not Affiliates of Holdco and (c) to which neither Holdco nor
any other Subsidiary of Holdco has any obligation to maintain or preserve such
entity’s financial condition or cause such entity to achieve certain levels of
operating results. Any such designation by the Board of Directors of Holdco or
such other Person shall be evidenced to the Trustee by filing with the Trustee
a certified copy of the resolution of the Board of Directors of Holdco or such
other Person giving effect to such designation and an Officer’s certificate
certifying that such designation complied with the foregoing conditions.

 

“Senior Debt” means
the principal of, premium, if any, and interest (including any interest
accruing subsequent to the filing of a petition of bankruptcy at the rate
provided for in the documentation with respect thereto, whether or not such
interest is an allowed or allowable claim under applicable law) on any
Indebtedness and any Securitization Repurchase Obligation of the Issuer,
whether outstanding on the Issue Date or thereafter created, incurred or
assumed, unless, in the case of any particular obligation, the instrument
creating or evidencing the same or pursuant to which the same is outstanding
expressly provides that such obligation shall not be senior in right of payment
to the Securities. Without limiting the generality of the foregoing, “Senior
Debt” shall also include the principal of, premium, if any, interest (including
any interest accruing subsequent to the filing of a petition of bankruptcy at
the rate provided for in the documentation with respect thereto, whether or not
such interest is

 

33

 

an allowed or allowable claim
under applicable law) on, and all other amounts owing in respect of (including
guarantees of the foregoing obligations):

 

(1)           all monetary obligations of every
nature of the Issuer under, or with respect to, the Credit Agreement,
including, without limitation, obligations to pay principal, premium and
interest, reimbursement obligations under letters of credit, fees, expenses and
indemnities (and guarantees thereof); and

 

(2)           all Hedging Obligations (and
guarantees thereof), in each case whether outstanding on the Issue Date or
thereafter incurred.

 

Notwithstanding
the foregoing, “Senior Debt” shall not include:

 

(1)           any Indebtedness of the Issuer to a
Subsidiary of the Issuer (other than any Securitization Repurchase Obligation);

 

(2)           Indebtedness to, or guaranteed on
behalf of, any shareholder, director, officer or employee of the Issuer or any
Subsidiary of the Issuer (including, without limitation, amounts owed for
compensation) other than the guarantee of Holdco of Indebtedness under the
Credit Agreement;

 

(3)           Indebtedness to trade creditors and
other amounts incurred in connection with obtaining goods, materials or
services (including guarantees thereof or instruments evidencing such
liabilities);

 

(4)           Indebtedness represented by Capital
Stock;

 

(5)           any liability for federal, state,
local or other taxes owed or owing by the Issuer;

 

(6)           that portion of any Indebtedness
incurred in violation of Section 4.10;

 

(7)           Indebtedness which, when incurred and
without respect to any election under Section 1111(b) of Title 11, United
States Code, is without recourse to the Issuer; and

 

(8)           any Indebtedness which is, by its
express terms, subordinated in right of payment to any other Indebtedness of
the Issuer.

 

“Significant
Subsidiary” means any Restricted Subsidiary that would be a “significant
subsidiary” as defined in Article 1, Rule 1-02 of Regulation S-X, promulgated
pursuant to the Securities Act, as such Regulation is in effect on the date
hereof.

 

34

 

“Specified
Financings” means the financings included in the Transactions
and this offering of the Securities.

 

“Sponsors” means
Thomas H. Lee Partners, L.P. (together with any limited partner thereof,
whether or not such investment in the Issuer is made through the same entity),
Bain Capital Partners, LLC, Providence Equity Partners and Music Capital
Partners, L.P.

 

“Standard
Securitization Undertakings” means representations,
warranties, covenants and indemnities entered into by Holdco or any Subsidiary
of Holdco which Holdco has determined in good faith to be customary in a
Securitization Financing, including, without limitation, those relating to the
servicing of the assets of a Securitization Subsidiary, it being understood
that any Securitization Repurchase Obligation shall be deemed to be a Standard
Securitization Undertaking.

 

“Stated Maturity”
means, with respect to any installment of interest or
principal on any series of Indebtedness, the date on which the payment of
interest or principal was scheduled to be paid in the original documentation
governing such Indebtedness, and will not include any contingent obligations to
repay, redeem or repurchase any such interest or principal prior to the date
originally scheduled for the payment thereof.

 

“Sterling
Exchange Securities” means any Sterling Securities issued in
exchange for Initial Sterling Securities or Sterling Securities without a
legend.

 

“Sterling
Securities” means the Sterling-denominated 8 1/8% Senior
Subordinated Notes due 2014 issued by the Issuer, including, without
limitation, the Sterling Exchange Securities and the Additional Sterling
Securities, treated as a single class of securities, as amended from time to
time in accordance with the terms hereof, that are issued pursuant to this
Indenture.

 

“Stockholders
Agreement” means the Stockholders Agreement by and among the
Issuer, the Sponsors and/or their Affiliates and the other stockholders party
thereto in effect on the Issue Date.

 

“Subordinated
Indebtedness” means (a) with respect to the Issuer, any
Indebtedness of the Issuer that is by its terms subordinated in right of
payment to the Securities and (b) with respect to any Guarantor of the
Securities, any Indebtedness of such Guarantor that is by its terms
subordinated in right of payment to its Guarantee of the Securities.

 

“Subsidiary” means,
with respect to any specified Person:

 

(1)           any corporation,
association or other business entity, of which more than 50% of the total
voting power of shares of Capital Stock entitled (without regard to the
occurrence of any contingency) to vote in the election of directors, managers
or

 

35

 

trustees
thereof is at the time owned or controlled, directly or indirectly, by that
Person or one or more of the other Subsidiaries of that Person (or a
combination thereof); and

 

(2)           any partnership,
joint venture, limited liability company or similar entity of which (x) more than
50% of the capital accounts, distribution rights, total equity and voting
interests or general or limited partnership interests, as applicable, are owned
or controlled, directly or indirectly, by such Person or one or more of the
other Subsidiaries of that Person or a combination thereof whether in the form
of membership, general, special or limited partnership or otherwise and (y)
such Person or any Wholly Owned Restricted Subsidiary of such Person is a
controlling general partner or otherwise controls such entity.

 

“Tax” means any tax, duty, levy, impost,
assessment or other governmental charge (including penalties, interest and any
other liabilities related thereto).

 

“Taxing Authority”
means any government or political subdivision or territory or
possession of any government or any authority or agency therein or thereof
having power to tax.

 

“TIA” means the Trust Indenture Act of 1939
(15 U.S.C. §§ 77aaa-77bbbb), as amended, as in effect on the date of the
execution of this Indenture until such time as this Indenture is qualified
under the TIA, and thereafter as in effect on the date on which this Indenture
is qualified under the TIA, except as otherwise provided in Section 9.04.

 

“Transactions” means
the transactions contemplated by (i) the Purchase Agreement, (ii) the Credit
Agreement and (iii) the offering of the Securities.

 

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

 

“U.K. Government
Securities” means securities that are:

 

(1)                                  direct
obligations of the United Kingdom or issued by any agency or instrumentality
thereof for the timely payment of which its full faith and credit is pledged,
or

 

(2)                                  obligations
of a Person controlled or supervised by and acting as an agency or
instrumentality of the United Kingdom, the timely payment of which is
unconditionally guaranteed as a full faith and credit obligation by the United
Kingdom,

 

36

 

which, in each case, are not
callable or redeemable at the option of the issuer thereof, and shall also
include a depository receipt issued by a bank (as defined in Section 3(a)(2) of
the Securities Act) as custodian with respect to any such U.K. Government
Securities or a specific payment of principal of or interest on any such U.K.
Government Securities held by such custodian for the account of the holder of
such depository receipt; provided that (except as required by law) such
custodian is not authorized to make any deduction from the amount payable to
the holder of such depository receipt from any amount received by the custodian
in respect of the U.K. Government Securities or the specific payment of
principal or interest on the U.K. Government Securities evidenced by such
depository receipt.

 

“U.K. Legal
Tender” means such coin or currency of the United Kingdom as at the
time of payment shall be legal tender for the payment of public and private
debts.

 

“Unrestricted
Securities” means one or more Dollar Securities that do not
and are not required to bear the legends in the form set forth in Exhibit
C-1 or Sterling Securities that do not and are not required to bear the
legends in the form set forth in Exhibit C-2, including, without
limitation, the Exchange Securities.

 

“Unrestricted
Subsidiary” means (i) any Subsidiary of the Issuer that at
the time of determination is an Unrestricted Subsidiary (as designated by the
Board of Directors of the Issuer, as provided below) and (ii) any Subsidiary of
an Unrestricted Subsidiary. The Board of Directors of the Issuer may designate
any Subsidiary of the Issuer (including any existing Subsidiary and any newly
acquired or newly formed Subsidiary) to be an Unrestricted Subsidiary unless
such Subsidiary or any of its Subsidiaries owns any Equity Interests or
Indebtedness of, or owns or holds any Lien on, any property of, the Issuer or
any Subsidiary of the Issuer (other than any Subsidiary of the Subsidiary to be
so designated), provided
that (a) any Unrestricted Subsidiary must be an entity of which
shares of the Capital Stock or other equity interests (including partnership
interests) entitled to cast at least a majority of the votes that may be cast
by all shares or equity interests having ordinary voting power for the election
of directors or other governing body are owned, directly or indirectly, by the
Issuer, (b) such designation complies with Section 4.11 and (c) each of (I) the
Subsidiary to be so designated and (II) its Subsidiaries has not at the time of
designation, and does not thereafter, create, incur, issue, assume, guarantee
or otherwise become directly or indirectly liable with respect to any
Indebtedness pursuant to which the lender has recourse to any of the assets of
the Issuer or any Restricted Subsidiary. The Board of Directors may designate
any Unrestricted Subsidiary to be a Restricted Subsidiary; provided that,
immediately after giving effect to such designation, no Default or Event of
Default shall have occurred and (1) the Issuer could incur $1.00 of additional
Indebtedness pursuant to the Coverage Ratio Exception described under Section
4.10(a), or (2) the Fixed Charge Coverage Ratio for the Issuer and its
Restricted Subsidiaries would be greater than such ratio for the Issuer and its
Restricted Subsidiaries immediately prior to such designation, in each case on a pro forma basis taking into account such
designation. Any such designation by the Board of Directors shall be notified

 

37

 

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

 

“U.S.  Dollar
Equivalent” means, with respect to any monetary amount in a currency
other than U.S. Dollars, at any time for the determination thereof, the amount
of U.S. Dollars obtained by converting such foreign currency involving in such
computation into U.S. Dollars at the spot rate for the purchase of U.S. Dollars
with the applicable foreign currency as quoted by Reuters at approximately
10:00 A.M., New York City time, on such date of determination (or if no such
quote is available on such date, on the immediately preceding Business Day for
which such a quote is available).

 

“U.S.  Government
Securities” means securities that are

 

(a)           direct obligations of the United
States of America for the timely payment of which its full faith and credit is
pledged or

 

(b)           obligations of a Person controlled or
supervised by and acting as an agency or instrumentality of the United States
of America the timely payment of which is unconditionally guaranteed as a full
faith and credit obligation by the United States of America,

 

which, in either case, are not
callable or redeemable at the option of the issuers thereof, and shall also
include a depository receipt issued by a bank (as defined in Section 3(a)(2) of
the Securities Act), as custodian with respect to any such Government
Securities or a specific payment of principal of or interest on any such
Government Securities held by such custodian for the account of the holder of
such depository receipt; provided that (except as required by law)
such custodian is not authorized to make any deduction from the amount payable
to the holder of such depository receipt from any amount received by the
custodian in respect of the Government Securities or the specific payment of
principal of or interest on the Government Securities evidenced by such
depository receipt.

 

“U.S.  Legal
Tender” means such coin or currency of the United States of America
as at the time of payment shall be legal tender for the payment of public and
private debts.

 

“Voting Stock” of
any Person as of any date means the Capital Stock of such Person that is at the time entitled to vote in the
election of the Board of Directors of such Person.

 

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

 

38

 

(1)           the sum 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 of the Indebtedness, by (b) the number of years
(calculated to the nearest one-twelfth) that will elapse between such date and
the making of such payment; by

 

(2)           the then outstanding principal amount
of such Indebtedness.

 

“Wholly Owned
Restricted Subsidiary” is any Wholly Owned Subsidiary that is
a Restricted Subsidiary.

 

“Wholly Owned
Subsidiary” of any Person means a Subsidiary of such Person,
100% of the outstanding Capital Stock or other ownership interests of which
(other than directors’ qualifying shares) shall at the time be owned by such
Person or by one or more Wholly Owned Subsidiaries of such Person or by such
Person and one or more Wholly Owned Subsidiaries of such Person.

 

SECTION 1.02.                                         Other
Definitions.

 

	
  Term

  	
   

  	
  Defined
  in Section

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  “Additional Dollar Securities”

  	
   

  	
  2.01

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  “Additional Securities”

  	
   

  	
  2.01

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  “Additional Sterling Securities”

  	
   

  	
  2.01

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  “Affiliate Transaction”

  	
   

  	
  4.14

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  “Agent Members”

  	
   

  	
  2.16

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  “Alternate Offer”

  	
   

  	
  4.09

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  “Asset Sale Offer”

  	
   

  	
  4.13

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  “Asset Sale Offer Amount”

  	
   

  	
  4.13

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  “Asset Sale Payment”

  	
   

  	
  4.13

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  “Asset Sale Payment Date”

  	
   

  	
  4.13

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  “Base Currency”

  	
   

  	
  12.14

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  “Change of Control Offer”

  	
   

  	
  4.09

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  “Change of Control Payment”

  	
   

  	
  4.09

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  “Change of Control Payment Date”

  	
   

  	
  4.09

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  “Covenant
  Defeasance”

  	
   

  	
  8.02

  	
   

  	
   

  

 

39

 

	
  Term

  	
   

  	
  Defined
  in Section

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  “Coverage Ratio Exception”

  	
   

  	
  4.10

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  “Event of Default”

  	
   

  	
  6.01

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  “Excess Proceeds”

  	
   

  	
  4.13

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  “Guarantee Obligations”

  	
   

  	
  11.01

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  “incur”

  	
   

  	
  4.10

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  “Judgment Currency”

  	
   

  	
  12.14

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  “Legal Defeasance”

  	
   

  	
  8.02

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  “Luxembourg Paying Agent”

  	
   

  	
  2.04

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  “Non-Payment Default”

  	
   

  	
  10.02

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  “Other Securities”

  	
   

  	
  2.02

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  “Paying Agent”

  	
   

  	
  2.04

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  “Payment Blockage Notice”

  	
   

  	
  10.02

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  “Payment Blockage Period”

  	
   

  	
  10.02

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  “Payment Default”

  	
   

  	
  10.02

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  “Permitted Debt”

  	
   

  	
  4.10

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  “Physical Securities”

  	
   

  	
  2.02

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  “Refunding Capital Stock”

  	
   

  	
  4.11

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  “Registrar”

  	
   

  	
  2.04

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  “Regulation S Dollar Securities”

  	
   

  	
  2.02

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  “Regulation S Global Dollar Security”

  	
   

  	
  2.16

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  “Regulation S Global Security”

  	
   

  	
  2.16

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  “Regulation S Global Sterling Security”

  	
   

  	
  2.16

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  “Regulation S Sterling Securities”

  	
   

  	
  2.02

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  “Restricted Global Securities”

  	
   

  	
  2.16

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  “Restricted Period”

  	
   

  	
  2.16

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  “Retired Capital Stock”

  	
   

  	
  4.11

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  “Rule 144A Dollar Securities”

  	
   

  	
  2.02

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  “Rule 144A Global Dollar Securities”

  	
   

  	
  2.02

  	
   

  	
   

  

 

40

 

	
  Term

  	
   

  	
  Defined
  in Section

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  “Rule 144A Global Sterling Securities”

  	
   

  	
  2.02

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  “Rule 144A Sterling Securities”

  	
   

  	
  2.02

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  “Sterling Paying Agent”

  	
   

  	
  2.04

  	
   

  	
   

  

 

SECTION 1.03.                                         Incorporation
by Reference of TIA.

 

Whenever this
Indenture refers to a provision of the TIA, such 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
securities” means the Securities.

 

“indenture
security holder” means a Holder or a Securityholder.

 

“indenture to be qualified” means
this Indenture.

 

“indenture
trustee” or “institutional
trustee” means the Trustee.

 

“obligor” on
the indenture securities means the Issuer or any other obligor on the Securities.

 

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

 

SECTION 1.04.                                         Rules
of Construction.

 

Unless the
context otherwise requires:

 

(1)           a term has the meaning assigned to it
herein, whether defined expressly or by reference;

 

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

 

(3)           “or” is not
exclusive;

 

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

 

(5)           words used herein
implying any gender shall apply to both genders;

 

41

 

(6)           provisions apply to successive events
and transactions;

 

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

 

(8)           the words “including,”
“includes” and similar words shall be deemed to be followed by “without
limitation”;

 

(9)           the principal amount of any
non-interest bearing or other discount security at any date shall be the
principal amount thereof that would be shown on a balance sheet of the issuer
dated such date prepared in accordance with GAAP;

 

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

 

(11)         unless otherwise
specified herein, all accounting terms used herein shall be interpreted, all
accounting determinations hereunder shall be made, and all financial statements
required to be delivered hereunder shall be prepared in accordance with GAAP;

 

(12)         “$” and “U.S. Dollars”
each refer to United States dollars, or such other money of the United States
of America that at the time of payment is legal tender for payment of public
and private debts;

 

(13)         “£” and “pounds
sterling” each refer to the lawful currency of the United Kingdom that at the
time of payment is legal tender for payment of public and private debts; and

 

(14)         whenever in this Indenture there is
mentioned, in any context, principal, interest or any other amount payable
under or with respect to any Securities, such mention shall be deemed to
include mention of the payment of Additional Interest, to the extent that, in
such context, Additional Interest is, was or would be payable in respect
thereof.

 

42

 

ARTICLE TWO

 

THE SECURITIES

 

SECTION 2.01.                                         Amount
of Securities.

 

The Trustee
shall initially authenticate Securities for original issue on the Issue Date in
an aggregate principal amount of $465,000,000 of Dollar Securities (the “Initial
Dollar Securities”) and an aggregate principal amount of
£100,000,000 of Sterling Securities (the “Initial Sterling Securities”
and, together with the Initial Dollar Securities, the “Initial
Securities”) upon a written order of the Issuer in the form
of an Officers’ Certificate of the Issuer (other than as provided in Section
2.08). The Trustee shall authenticate Dollar Securities (the “Additional
Dollar Securities”) and Sterling Securities (the “Additional
Sterling Securities”)
thereafter in unlimited amount (so long as permitted by the terms of this
Indenture, including, without limitation, Section 4.10) (any such Securities,
the “Additional
Securities”) for original issue upon a written order of the
Issuer in the form of an Officers’ Certificate in aggregate principal amount as
specified in such order (other than as provided in Section 2.08). Each such
written order shall specify the principal amount of Additional Dollar
Securities and/or Additional Sterling Securities to be authenticated and the
date on which the Additional Dollar Securities and/or Additional Sterling
Securities are to be authenticated.

 

SECTION 2.02.                                         Form
and Dating.

 

The Dollar
Securities and the Trustee’s certificate of authentication shall be
substantially in the form of Exhibit A hereto and the Sterling
Securities and the Trustee’s certificate of authentication shall be
substantially in the form of Exhibit B hereto, both of which are
incorporated in and form a part of this Indenture. The Securities may have
notations, legends or endorsements required by law, rule or usage to which the
Issuer is subject. Without limiting the generality of the foregoing, Securities
offered and sold to Qualified Institutional Buyers in reliance on Rule 144A (“Rule 144A
Securities”) shall bear the legend and include the form of
assignment set forth in Exhibit C-1 in the case of Dollar Securities and
Exhibit C-2 in the case of Sterling Securities, Securities offered and
sold in offshore transactions in reliance on Regulation S (“Regulation
S Securities”) shall bear the legend and include the form of
assignment set forth in Exhibit D, and Securities offered and sold to
Institutional Accredited Investors in transactions exempt from registration
under the Securities Act not made in reliance on Rule 144A or Regulation S (“Other
Securities”) may be represented by a Restricted Global
Security or, if such an investor may not hold an interest in the Restricted
Global Security, a Physical Security, in each case, bearing the Private
Placement Legend. The Issuer shall approve the form of the Securities and any
notation, legend or endorsement on them. Each Security shall be dated the date
of its issuance and show the date of its authentication.

 

43

 

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

 

The Securities
may be presented for registration of transfer and exchange at the offices of
the Registrar.

 

Securities
issued in exchange for interests in a Global Security pursuant to Section 2.16
may be issued in the form of permanent certificated Securities in registered
form in substantially the form set forth in Exhibit A in the case of
Dollar Securities and Exhibit B in the case of Sterling Securities (the “Physical
Securities”).

 

SECTION 2.03.                                         Execution
and Authentication.

 

One Officer,
who shall have been duly authorized by all requisite corporate actions, shall
sign the Securities for the Issuer by manual or facsimile signature.

 

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

 

No Security
shall be entitled to any benefit under this Indenture or be valid or obligatory
for any purpose unless there appears on such Security a certificate of
authentication substantially in the form provided for herein executed by the
Trustee by manual signature, and such certificate upon any Security shall be
conclusive evidence, and the only evidence, that such Security has been duly
authenticated and delivered hereunder. Notwithstanding the foregoing, if any
Security shall have been authenticated and delivered hereunder but never issued
and sold by the Issuer, and the Issuer shall deliver such Security to the
Trustee for cancellation as provided in Section 2.12, for all purposes of this
Indenture such Security shall be deemed never to have been authenticated and
delivered hereunder and shall never be entitled to the benefits of this
Indenture.

 

The Trustee
may appoint one or more authenticating agents with the consent of the Issuers
to authenticate the Securities. Unless otherwise provided in the appointment,
an authenticating agent may authenticate the Securities whenever the Trustee
may do so. Each reference in this Indenture to authentication by the Trustee
includes authentication by such agent. An authenticating agent has the same
rights as an Agent to deal with the Issuer and Affiliates of the Issuers. Each
Paying Agent is designated as an authenticating agent for purposes of this
Indenture.

 

44

 

The Securities
shall be issuable only in registered form without coupons in denominations of
$5,000 and any integral multiples of $1,000, in the case of Dollar Securities,
and £5,000 and any integral multiples of £1,000, in the case of Sterling
Securities.

 

SECTION 2.04.                                         Registrar
and Paying Agent.

 

The Issuer
shall maintain (a) an officer or agency where Securities may be presented for
registration of transfer or for exchange (the “Registrar”), (b) an
office or agency in the Borough of Manhattan, The City of New York, the State
of New York, where Dollar Securities may be presented for payment (the “Dollar
Paying Agent”) (c) an office or agency in the Borough of
Manhattan, The City of New York, the State of New York, and London, England
where Sterling Securities may be presented for payment (the “Sterling
Paying Agent”), (d) so long as the Sterling Securities are
listed on the Luxembourg Stock Exchange, an office or agency in Luxembourg
where Sterling Securities may be presented for payment (the “Luxembourg
Paying Agent”) and (e) an office or agency where notices and
demands to or upon the Issuer, if any, in respect of the Securities and this
Indenture may be served. The Registrar shall keep a register of the Securities
and of their transfer and exchange. The Registrar shall provide a copy of such
register. The Issuer may have on or more co-registrars and one or more
additional Paying Agents. The term “Registrar” includes any
co-registrars. The Issuer shall maintain a co-registrar in London, England and,
so long as the Sterling Securities are listed on the Luxembourg Stock Exchange
and if required by the rules of the Luxembourg Stock Exchange, in Luxembourg
where Sterling Securities may be presented for registration of transfer or for
exchange. The term “Paying Agents” means the Dollar
Paying Agent, the Sterling Paying Agent, the Luxembourg Paying Agent (if any)
and any additional Paying Agents. The Issuer or any Affiliate thereof may act
as Registrar or Paying Agent.

 

The Issuer
shall enter into an appropriate agency agreement, which shall incorporate the
provisions of the TIA, with any Agent that is not a party to this Indenture; provided that
any such agency agreement with the Luxembourg Paying Agent need not incorporate
the provisions of the TIA. The agreement shall implement the provisions of this
Indenture that relate to such Agent. The Issuer shall notify the Trustee of the
name and address of any such Agent. If the Issuer fails to maintain a Registrar
or any required co-registrar or Paying Agent, or fails to give the foregoing
notice, the Trustee shall act as such and shall be entitled to appropriate
compensation in accordance with Section 7.07.

 

The Issuer
initially appoints the Trustee as Registrar, Dollar Paying Agent and Agent for
service of notices and demands in connection with the Securities and this
Indenture. The Issuer initially appoints HSBC Bank plc, as a co-registrar and
as Sterling Paying Agent.

 

If the
European Council Directive 2003/48/EC or any other directive implementing the
conclusions of the ECOFIN Council meeting of 26-27 November 2000 is
implemented, the Issuer will use its best efforts to maintain a paying agent in
a member state of the European Union that will not be obliged to withhold or
deduct tax pursuant to any European

 

45

 

Union Directive on the taxation
of savings implementing such conclusions or any law implementing or complying
with, or introduced to conform to, such directive.

 

The Issuer may
change the paying agents, the registrars or the transfer agents without prior
notice to the Holders. If, and for so long as, the Sterling Securities are
listed on the Luxembourg Stock Exchange and its rules so require, the Issuer
will publish a notice of any change of paying agent, registrar or transfer
agent in a newspaper having a general circulation in Luxembourg. The Issuer or
any of its Subsidiaries may act as a paying agent or registrar.

 

The Issuer may
also from time to time designate one or more other offices or agencies where
the Securities 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 Issuer of its
obligation to maintain an office or agency in the Borough of Manhattan, The
City of New York and London, England for such purposes. The Registrar shall
keep a register of the Securities and of their transfer and exchange. The
Issuer, upon notice to the Trustee, may have one or more co-Registrars and one
or more additional paying agents reasonably acceptable to the Trustee. The term
“Paying Agent” includes any additional paying agent.

 

SECTION 2.05.                                         Paying
Agent To Hold Assets in Trust.

 

Each Paying
Agent shall hold in trust for the benefit of the Holders or the Trustee all
money held by the Paying Agent for the payment of principal of or premium or
interest on the Securities (whether such money has been paid to it by the
Issuer, one or more of the Guarantors or any other obligor on the Securities),
and the Issuer and each Paying Agent shall notify the Trustee of any Default by
the Issuer (or any other obligor on the Securities) in making any such payment.
Money held in trust by a Paying Agent need not be segregated except as required
by law and in no event shall a Paying Agent be liable for any interest on any
money received by it hereunder. The Issuer at any time may require a Paying
Agent to pay all money held by it to the Trustee and account for any funds
disbursed and the Trustee may at any time during the continuance of any Event
of Default specified in Section 6.01(1) or (2), upon written request to a
Paying Agent, require such Paying Agent to pay forthwith all money so held by
it to the Trustee and to account for any funds disbursed. Upon making such
payment, such Paying Agent shall have no further liability for the money
delivered to the Trustee

 

SECTION
2.06.                                         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 Holders. If the
Trustee is not the Registrar, the Issuer shall furnish to the Trustee at least
two (2) Business Days prior to each Interest Payment Date and at such other
times as the Trustee may request in writing a list in

 

46

 

such form and as of such date
as the Trustee may reasonably require of the names and addresses of Holders,
which list may be conclusively relied upon by the Trustee.

 

SECTION 2.07.                                         Transfer
and Exchange.

 

Subject to
Sections 2.16 and 2.17, when Securities are presented to the Registrar or a
co-Registrar with a request to register the transfer of such Securities or to
exchange such Securities for an equal principal amount of Securities of other
authorized denominations, the Registrar or co-Registrar shall promptly register
the transfer or make the exchange as requested if its requirements for such
transaction are met; provided, however, that the Securities
surrendered for transfer or exchange shall be duly endorsed or accompanied by a
written instrument of transfer in form satisfactory to the Issuer and the
Registrar or co-Registrar, duly executed by the Holder thereof or his or her
attorney duly authorized in writing. To permit registrations of transfers and
exchanges, the Issuer shall execute and the Trustee shall authenticate
Securities at the Registrar’s or co-Registrar’s request. No service charge
shall be made for any registration of transfer or exchange, but the Issuer may
require payment of a sum sufficient to cover any transfer tax or similar
governmental charge payable in connection therewith.

 

The Registrar
or co-Registrar shall not be required to register the transfer of or exchange
of any Security (i) during a period beginning at the opening of business 15
days before the mailing of a notice of redemption of Securities and ending at
the close of business on the day of such mailing, (ii) selected for redemption
in whole or in part pursuant to Article Three, except the unredeemed portion of
any Security being redeemed in part, and (iii) during a Change of Control
Offer, an Alternate Offer or an Asset Sale Offer if such Security is tendered
pursuant to such Change of Control Offer, Alternate
Offer or Asset Sale Offer and not withdrawn.

 

Any Holder of
a beneficial interest in a Global Security shall, by acceptance of such
beneficial interest, agree that transfers of beneficial interests in such
Global Securities may be effected only through a book-entry system maintained
by the Holder of such Global Security (or its agent), and that ownership of a
beneficial interest in the Security shall be required to be reflected in a
book-entry system.

 

SECTION 2.08.                                         Replacement
Securities.

 

If a mutilated
Security is surrendered to the Registrar or the Trustee, or if the Holder of a
Security claims that the Security has been lost, destroyed or wrongfully taken,
the Issuer shall issue and the Trustee shall authenticate a replacement
Security (and the Guarantors, if any, shall execute the guarantee thereon) if
the Holder of such Security furnishes to the Issuer and the Trustee evidence
reasonably acceptable to them of the ownership and the destruction, loss or
theft of such Security and if the requirements of Section 8-405 of the New York
Uniform Commercial Code as in effect on the date of this Indenture are met. If
required

 

47

 

by the Trustee or the Issuer,
an indemnity bond shall be posted, sufficient in the judgment of all to protect
the Issuer, the Guarantors, if any, the Trustee or any Paying Agent from any
loss that any of them may suffer if such Security is replaced. The Issuer may
charge such Holder for the Issuer’s reasonable out-of-pocket expenses in
replacing such Security and the Trustee may charge the Issuer for the Trustee’s
expenses (including, without limitation, attorneys’ fees and disbursements) in
replacing such Security. Every replacement Security shall constitute a
contractual obligation of the Issuer.

 

SECTION 2.09.                                         Outstanding
Securities.

 

The Securities
outstanding at any time are all the Securities that have been authenticated by
the Trustee except (a) those canceled by it, (b) those delivered to it for
cancellation, (c) to the extent set forth in Sections 9.01 and 9.02, on or
after the date on the conditions set forth in Section 9.01 or 9.02 have been
satisfied and (d) these Securities theretofore authenticated by the Trustee hereunder
and those described in this Section as not outstanding. A Security does not
cease to be outstanding because the Issuer or any of its Affiliates holds the
Security (subject to the provisions of Section 2.10).

 

If a Security
is replaced pursuant to Section 2.08 (other than a mutilated Security
surrendered for replacement), it ceases to be outstanding unless the Trustee
receives proof satisfactory to it that the replaced Security is held by a bona fide purchaser
in whose hands such Security is a legal, valid and binding obligation of the
Issuer. A mutilated Security ceases to be outstanding upon surrender of such
Security and replacement thereof pursuant to Section 2.08.

 

If the
principal amount of any Security is considered paid under Section 4.01, it ceases
to be outstanding and interest ceases to accrue. If on a Redemption Date or the
Maturity Date the Trustee or Paying Agent (other than the Issuer or an
Affiliate thereof) holds U.S. Legal Tender or U.S. Government Securities
sufficient to pay all of the principal and interest due on the Dollar
Securities payable on that date, or U.K. Legal Tender or U.K. Government
Securities sufficient to pay all of the principal and interest due on the
Sterling Securities payable on that date, then on and after that date such
Dollar Securities and/or Sterling Securities cease to be outstanding and
interest on them ceases to accrue.

 

SECTION 2.10.                                         Treasury
Securities.

 

In determining
whether the Holders of the required principal amount of Securities have
concurred in any direction, waiver or consent, Securities owned by the Issuer
or any of its Affiliates shall be disregarded, except that, for the purposes of
determining whether the Trustee shall be protected in relying on any such
direction, waiver or consent, only Securities that a Responsible Officer of the
Trustee actually knows are so owned shall be disregarded.

 

48

 

SECTION 2.11.                                         Temporary
Securities.

 

Until
definitive Securities are ready for delivery, the Issuer may prepare and the
Trustee shall authenticate temporary Securities. Temporary Securities shall be
substantially in the form of definitive Securities but may have variations that
the Issuer considers appropriate for temporary Securities. Without unreasonable
delay, the Issuer shall prepare and the Trustee shall authenticate definitive
Securities in exchange for temporary Securities. Until such exchange, temporary
Securities shall be entitled to the same rights, benefits and privileges as
definitive Securities. Notwithstanding the foregoing, so long as the Securities
are represented by a Global Security, such Global Security may be in
typewritten form.

 

SECTION 2.12.                                         Cancellation.

 

The Issuer at
any time may deliver Securities to the Trustee for cancellation. The Registrar
and the Paying Agent shall forward to the Trustee any Securities surrendered to
them for transfer, exchange or payment. The Trustee or, at the direction of the
Trustee, the Registrar or the Paying Agent (other than the Issuer or a
Subsidiary), and no one else, shall cancel and, at the written direction of the
Issuer, shall dispose of all Securities surrendered for transfer, exchange,
payment or cancellation in accordance with its customary procedures. Subject to
Section 2.08, the Issuer may not issue new Securities to replace Securities
that it has paid or delivered to the Trustee for cancellation. If the Issuer or
any Guarantor shall acquire any of the Securities, such acquisition shall not
operate as a redemption or satisfaction of the Indebtedness represented by such
Securities unless and until the same are surrendered to the Trustee for
cancellation pursuant to this Section 2.12.

 

SECTION 2.13.                                         Defaulted
Interest.

 

If the Issuer
defaults in a payment of interest on the Dollar Securities or the Sterling
Securities, it shall, unless the Trustee fixes another record date pursuant to
Section 6.10, pay the defaulted interest then borne by the Dollar Securities or
Sterling Securities, as the case may be, plus (to the extent lawful) any
interest payable on the defaulted interest, in accordance with the terms
hereof. The Issuer may pay the defaulted interest to the persons who are
Holders on a subsequent special record date, which special record date shall be
the fifteenth day next preceding the date fixed by the Issuer for the payment
of defaulted interest or the next succeeding Business Day if such date is not a
Business Day. At least 15 days before any such subsequent special record date,
the Issuer shall mail to each Holder, with a copy to the Trustee, a notice that
states the subsequent special record date, the payment date and the amount of
defaulted interest, and interest payable on such defaulted interest, if any, to
be paid. The Issuer may make payment of any defaulted interest in any other lawful
manner not inconsistent with the requirements (if applicable) of any securities
exchange on which the Dollar Securities or the Sterling Securities may be
listed and, upon such notice as may be required by such exchange, if, after
written notice given by the Issuer to the Trustee of the proposed payment

 

49

 

pursuant to this sentence, such
manner of payment shall be deemed practicable by the Trustee.

 

SECTION 2.14.                                         CUSIP,
ISIN and “Common Code” Numbers.

 

The Issuer in
issuing the Securities may use CUSIP numbers, ISINs and “Common Code” numbers
(if then generally in use) and, if so, the Trustee shall use, as applicable,
CUSIP numbers, ISINs and “Common Code” numbers in notices of redemption as a
convenience to Holders; provided, however, that any such
notice may state that no representation is made as to the correctness or
accuracy of such numbers, either as printed on the Securities or as contained
in any notice of a redemption, that reliance may be placed only on the other
identification number(s) printed on the Securities. The Issuer shall advise the
Trustee of any change in the CUSIP numbers, ISINs and “Common Code” numbers.

 

SECTION 2.15.                                         Deposit
of Moneys.

 

Prior to 10:00
a.m. New York City time, in the case of the Dollar Securities, and 10:00 a.m.
London time, in the case of the Sterling Securities, on each Interest Payment
Date, Maturity Date, Redemption Date, Change of Control Payment Date and Asset
Sale Offer Payment Date, the Issuer shall have deposited with the Paying Agent
in immediately available funds U.S. Legal Tender, in the case of the Dollar
Securities, or U.K. Legal Tender, in the case of the Sterling Securities,
sufficient to make cash payments, if any, due on such Interest Payment Date, Maturity
Date, Redemption Date, Change of Control Payment Date and Asset Sale Offer
Payment Date, as the case may be, in a timely manner which permits the Paying
Agent to remit payment to the Holders on such Interest Payment Date, Maturity
Date, Redemption Date, Change of Control Payment Date and Asset Sale Offer
Payment Date, as the case may be. The principal and interest on Global
Securities shall be payable to the Depository or the Common Depositary, as
applicable or its nominee, as the case may be, as the sole registered owner and
the sole Holder of the Global Securities represented thereby. The principal and
interest on Physical Securities shall be payable, either in person or by mail,
at the office of the applicable Paying Agent.

 

SECTION 2.16.                                         Book-Entry
Provisions for Global Securities.

 

(a)           Rule 144A Securities that are Dollar
Securities (“Rule 144A Dollar Securities”) initially shall be
represented by one or more Securities in registered, global form without
interest coupons (collectively, the “Rule 144A Global Dollar Securities”).
Rule 144A Securities that are Sterling Securities (“Rule 144A Sterling
Security”) initially shall be represented by one or more Securities in
registered, global form without interest coupons (collectively, the “Rule
144A Global Sterling Security” and, together with the Rule 144A Global
Dollar Security, the “Rule I44A Global Securities”). Regulation S
Securities that are Dollar Securities (“Regulation S Dollar Securities”)
initially shall be represented by one or more Securities in registered, global
form without interest coupons (collectively, the “Regulation S

 

50

 

Global Dollar
Security”). Regulation S Securities that are Sterling
Securities (“Regulation S  Sterling Securities”) initially shall
be represented by one or more Securities in registered, global form without
interest coupons (collectively, the “Regulation S Global Sterling Security”
and, together with the Regulation S Global Dollar Security, the “Regulation
S Global  Securities”). The term “Global Dollar Securities”
means the Rule 144A Global Dollar Security and the Regulation S Global Dollar
Security. The term “Global Sterling Securities” means, collectively, the
Rule 144A Global Sterling Security and the Regulation S Sterling Security. The
term “Global Securities” means, collectively, the Rule 144A Global
Securities and the Regulation S Global Securities. The Global Securities shall
bear legends as set forth in Exhibit E-1 in the case of Global Dollar
Securities and Exhibit E-2 in the case of Global Sterling Securities.
The Global Securities initially shall (i) be registered in the name of the
Depositary or the Common Depositary, in the case of the Sterling Securities or
the nominee of such Depositary or the Common Depositary, in the case of the
Sterling Securities, in each case for credit to an account of an Agent Member,
(ii) be delivered to the Trustee as custodian for such Depositary or the Common
Depositary, in the case of the Sterling Securities and (iii) bear legends as
set forth in Exhibit C-1 with respect to Restricted Global Dollar
Securities, Exhibit C-2 with respect to Global Sterling Securities and Exhibit
D with respect to Regulation S Global Securities.

 

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

 

(b)           Transfers of Global Dollar Securities
shall be limited to transfer in whole, but not in part, to the Depositary, its
successors or their respective nominees. Transfers of Global Sterling
Securities shall be limited to transfer in whole, but not in part, to the
Common Depositary, its successors or their respective nominees. Interests of
beneficial owners in the Global Securities may be transferred or exchanged for
Physical Securities in accordance with the rules and procedures of the
Depositary or the Common Depositary, as the case may be, and the provisions of
Section 2.17. In addition, a Global Security shall be exchangeable for Physical
Securities if (i) in the case of a Global Dollar Security, the Depositary (x)
notifies the Issuer that it is unwilling or unable to continue as depository
for such Global Security

 

51

 

and the Issuer thereupon fail
to appoint a successor depository or (y) has ceased to be a clearing agency
registered under the Exchange Act, (ii) in the case of a Global Sterling
Security, (x) Euroclear or Clearstream notifies the Company that it is
unwilling or unable to continue as clearing agency or (y) the Common Depository
notifies the Company that it is unwilling or unable to continue as common
depository for such Global Sterling Note and the Company fails to appoint a
successor common depository within 120 days of such notice, (iii) the Issuer,
at its option, notifies the Trustee in writing that it elects to cause the
issuance of such Physical Securities or (iv) in the case of any GIobal Note,
there shall have occurred and be continuing an Event of Default with respect to
such Global Note. In all cases, Physical Securities delivered in exchange for
any Global Security or beneficial interests therein shall be registered in the
names, and issued in any approved denominations, requested by or on behalf of
the Depositary or the Common Depositary, as applicable, in accordance with its
customary procedures.

 

(c)           In connection with any transfer or
exchange of a portion of the beneficial interest in any Global Security to
beneficial owners pursuant to paragraph (b), the Registrar shall (if one or
more Physical Securities are to be issued) reflect on its books and records the
date and a decrease in the principal amount of the Global Security in an amount
equal to the principal amount of the beneficial interest in the Global Security
to be transferred, and the Issuer shall execute, and the Trustee shall upon
receipt of a written order from the Issuer authenticate and make available for
delivery, one or more Physical Securities of like tenor and amount.

 

(d)           In connection with the transfer of
Global Securities as an entirety to beneficial owners pursuant to paragraph
(b), the Global Securities shall be deemed to be surrendered to the Trustee for
cancellation, and the Issuer shall execute, and the Trustee shall authenticate
and deliver, to each beneficial owner identified by the Depositary or the
Common Depositary, in the case of the Sterling Securities in writing in
exchange for its beneficial interest in the Global Securities, an equal
aggregate principal amount of Physical Securities of authorized denominations.

 

(e)           Any Physical Security constituting a
Restricted Security delivered in exchange for an interest in a Global Security
pursuant to paragraph (b), (c) or (d) shall, except as otherwise provided by
paragraphs (a)(i)(x) and (c) of Section 2.17, bear the Private Placement Legend
or, in the case of the Regulation S Global Security, the legend set forth in Exhibit
D, in each case, unless the Issuers determine otherwise in compliance with
applicable law.

 

(f)            On or prior to the 40th day after
the later of the commencement of the offering of the Securities represented by
the Regulation S Global Security and the issue date of such Securities (such period through and including such 40th day, the “Restricted  Period”), a beneficial interest in a Regulation S Global
Security may be transferred to a Person

 

52

 

who takes delivery in the form
of an interest in the corresponding Restricted Global Security only upon
receipt by the Trustee of a written certification from the transferor to the
effect that such transfer is being made (i)(a) to a Person that the transferor
reasonably believes is a Qualified Institutional Buyer in a transaction meeting
the requirements of Rule 144A or (b) pursuant to another exemption from the
registration requirements under the Securities Act which is accompanied by an
Opinion of Counsel regarding the availability of such exemption and (ii) in
accordance with all applicable securities laws of any state of the United
States or any other jurisdiction.

 

(g)           Beneficial interests in the
Restricted Global Security may be transferred to a Person who takes delivery in
the form of an interest in the Regulation S Global Security, whether before or
after the expiration of the Restricted Period, only if the transferor first
delivers to the Trustee a written certificate to the effect that such transfer
is being made in accordance with Regulation S or Rule 144 (if available).

 

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

 

(i)            The Holder of any Global Security
may grant proxies and otherwise authorize any Person, including Agent Members
and Persons that may hold interests through Agent Members, to take any action
which a Holder is entitled to take under this Indenture or the Securities.

 

SECTION 2.17.                                         Special
Transfer Provisions.

 

(a) Transfers
to Non-QIB Institutional Accredited Investors and Non-U.S. Persons. The
following provisions shall apply with respect to the registration of any
proposed transfer of a Security constituting a Restricted Security to any
Institutional Accredited Investor which is not a QIB or to any Non-U.S. Person:

 

(i)            the Registrar shall
register the transfer of any Security constituting a Restricted Security,
whether or not such Security bears the Private Placement Legend, if (x) the
requested transfer is after the second anniversary of the date of original issuance
thereof or such other date as such Security shall be freely transferable under
Rule 144 as certified in an Officers’ Certificate or (y) (1) in the case of a
transfer to an Institutional Accredited Investor which is not a QIB (excluding
Non-U.S. Persons), the proposed transferee has delivered to the Registrar a
certificate substantially in the form of Exhibit F hereto or (2) in the
case of a transfer to a Non-U.S. Person (including a QIB), the proposed
transferor has delivered to the Registrar a certificate substantially

 

53

 

in the form of
Exhibit G hereto; provided that
in the case of any transfer of a Security bearing the Private Placement Legend
for a Security not bearing the Private Placement Legend, the Registrar has
received an Officers’ Certificate authorizing such transfer; and

 

(ii)           if the proposed
transferor is an Agent Member holding a beneficial interest in a Global
Security, upon receipt by the Registrar of (x) the certificate, if any, required
by paragraph (i) above and (y) instructions given in accordance with the
Depositary’s and the Registrar’s procedures,

 

whereupon (a) the Registrar
shall reflect on its books and records the date and (if the transfer does not
involve a transfer of outstanding Physical Securities) a decrease in the
principal amount of a Global Security in an amount equal to the principal
amount of the beneficial interest in a Global Security to be transferred, and
(b) the Registrar shall reflect on its books and records the date and an
increase in the principal amount of a Global Security in an amount equal to the
principal amount of the beneficial interest in the Global Security transferred
or the Issuers shall execute and the Trustee shall authenticate and make
available for delivery one or more Physical Securities of like tenor and
amount.

 

(b)           Transfers to OIBs. The
following provisions shall apply with respect to the registration or any
proposed registration of transfer of a Security constituting a Restricted
Security to a QIB (excluding transfers to Non-U.S. Persons):

 

(i)            the Registrar shall
register the transfer if such transfer is being made by a proposed transferor
who has checked the box provided for on such Holder’s Security stating, or to a
transferee who has advised the Issuers and the Registrar in writing, that it is
purchasing the Security for its own account or an account with respect to which
it exercises sole investment discretion and that it and any such account is a
QIB within the meaning of Rule 144A, and is aware that the sale to it is being
made in reliance on Rule 144A and acknowledges that it has received such
information regarding the Issuers as it has requested pursuant to Rule 144A or
has determined not to request such information and that it is aware that the
transferor is relying upon its foregoing representations in order to claim the
exemption from registration provided by Rule 144A; and

 

(ii)           if the proposed transferee is an
Agent Member, and the Securities to be transferred consist of Physical Securities
which after transfer are to be evidenced by an interest in the Global Security,
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
Global Security in an amount equal to the principal amount of the Physical
Securities to be transferred, and the Trustee shall cancel the Physical
Securities so transferred.

 

54

 

(c)           Private Placement Legend. Upon
the registration of transfer, exchange or replacement of Securities not bearing
the Private Placement Legend, the Registrar shall deliver Securities that do
not bear the Private Placement Legend. Upon the registration of transfer,
exchange or replacement of Securities bearing the Private Placement Legend, the
Registrar shall deliver only Securities that bear the Private Placement Legend
unless (i) it has received the Officers’ Certificate required by paragraph
(a)(i)(y) of this Section 2.17, (ii) there is delivered to the Registrar an
Opinion of Counsel reasonably satisfactory to the Issuers and the Trustee to
the effect that neither such legend nor the related restrictions on transfer are
required in order to maintain compliance with the provisions of the Securities
Act or (iii) such Security has been sold pursuant to an effective registration
statement under the Securities Act and the Registrar has received an Officers’
Certificate from the Issuer to such effect.

 

(d)           General. By its acceptance of
any Security bearing the Private Placement Legend, each Holder of such Security
acknowledges the restrictions on transfer of such Security set forth in this
Indenture and in the Private Placement Legend and agrees that it will transfer
such Security only as provided in this Indenture.

 

The Registrar
shall retain for a period of two years copies of all letters, notices and other
written communications received pursuant to Section 2.16 or this Section 2.17.
The Issuer shall have the right to inspect and make copies of all such letters,
notices or other written communications at any reasonable time upon the giving
of reasonable notice to the Registrar.

 

SECTION 2.18.                                         Computation
of Interest.

 

Interest on
the Securities shall be computed on the basis of a 360-day year of twelve
30-day months and actual days elapsed.

 

SECTION 2.19.                                         Calculation
of Principal Amount of Securities.

 

The aggregate
principal amount of the Securities, at any date of determination, shall be the
sum of (1) the principal amount of the Dollar Securities at such date of
determination plus (2) the U.S. Dollar Equivalent, at such date of
determination, of the principal amount of the Sterling Securities at such date
of determination. With respect to any matter requiring consent, waiver,
approval or other action of the Holders of a specified percentage of the
principal amount of all the Securities (and not solely the Dollar Securities or
the Sterling Securities as provided for in the proviso to the first sentence of
Section 9.02(a)), such percentage shall be calculated, on the relevant date of
determination, by dividing (a) the principal amount, as of such date of
determination, of Securities, the Holders of which have so consented, by (b) the
aggregate principal amount, as of such date of determination, of the Securities
then outstanding, in each case, as determined in accordance with the preceding
sentence, and Section 2.09 of this Indenture. Any such calculation made
pursuant to this Section 2.19 shall be made by the Issuer and delivered to the
Trustee pursuant to an Officers’ Certificate.

 

55

 

ARTICLE THREE

 

REDEMPTION

 

SECTION 3.01.                                         Notices
to Trustee.

 

If the Issuer
elects to redeem Securities pursuant to Section 5 or Section 6 of the
Securities, it shall notify the Trustee in writing of the Redemption Date, the
Redemption Price and the principal amount of Securities to be redeemed. The
Issuer shall give notice of redemption to the Paying Agent and Trustee at least
30 days but not more than 60 days before the Redemption Date (unless a shorter
notice shall be agreed to by the Trustee in writing), together with an Officers’
Certificate stating that such redemption will comply with the conditions
contained herein.

 

SECTION 3.02.                                         Selection
of Securities To Be Redeemed.

 

If less than
all of the Securities are to be redeemed at any time, the Trustee will select
Securities for redemption as follows:

 

(1)           if the Securities are listed on a
national securities exchange, in compliance with the requirements of the
principal national securities exchange (including the Luxembourg Stock
Exchange) on which the Securities are listed; or

 

(2)           if the Securities are not listed on any securities exchange, on a pro rata basis, by lot or by such
method as the Trustee deems fair and appropriate.

 

No Dollar
Securities of $5,000 or less or Sterling Securities of £5,000 or less shall be
redeemed in part.

 

If a partial
redemption is made with the proceeds of an Equity Offering in accordance with
Section 6 of the Securities, forms of which are attached hereto as Exhibit A
and Exhibit B, the Trustee will select the applicable Securities on a pro rata
basis or on as nearly a pro rata basis as is practicable (subject to DTC
procedures).

 

SECTION 3.03.                                         Notice
of Redemption.

 

At least 30
days but not more than 60 days before a Redemption Date, the Issuer shall mail
a notice of redemption by first class mail, postage prepaid, to each Holder
whose Securities are to be redeemed at its registered address, except that
redemption notices may be mailed more than 60 days prior to a Redemption Date
if the notice is issued in connection with a defeasance of the Securities or a
satisfaction and discharge of this Indenture. At the Issuer’s request, the
Trustee shall forward the notice of redemption in the Issuer’s

 

56

 

name and at the Issuer’s expense;
provided
that in such case, the Trustee has received notice from the Issuer
at least 31 days, but not more than 60 days, before a Redemption Date (unless a
shorter notice shall be agreed to in writing by the Trustee). Securities called
for redemption become due on the date fixed for redemption. On and after the
Redemption Date, interest ceases to accrue on Securities or portions of them
called for redemption. Each notice of redemption shall identify the Securities
(including the CUSIP number) to be redeemed and shall state:

 

(1)           the Redemption Date;

 

(2)           the Redemption Price and the amount
of accrued interest, if any, to be paid;

 

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

 

(4)           that Securities called for redemption
must be surrendered to the Paying Agent to collect the Redemption Price, plus
accrued interest, if any;

 

(5)           that, unless the Issuer defaults in
making the redemption payment, interest on Securities called for redemption
ceases to accrue on and after the Redemption Date, and the only remaining right
of the Holders of such Securities is to receive payment of the Redemption Price
upon surrender to the Paying Agent of the Securities redeemed;

 

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

 

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

 

(8)           the CUSIP Number, ISIN and/or “Common
Code” number, if any, printed on the Securities being redeemed;

 

(9)           that no representation is made as to
the correctness or accuracy of the CUSIP number or ISIN and/or “Common Code”
number, if any, listed in such notice or printed on the Securities; and

 

(10)         the Section of the Securities pursuant
to which the Securities are to be redeemed.

 

57

 

The notice, if
mailed in a 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
Security designated for redemption in whole or in part shall not affect the
validity of the proceedings for the redemption of any other Security. Notices
of redemption may not be conditional.

 

SECTION 3.04.                                         Effect
of Notice of Redemption.

 

Once notice of
redemption is mailed in accordance with Section 3.03, Securities called for
redemption become due and payable on the Redemption Date and at the Redemption
Price plus accrued interest, if any. Upon surrender to the Trustee or Paying
Agent, such Securities called for redemption shall be paid at the Redemption
Price (which shall include accrued interest thereon to the Redemption Date),
but installments of interest, the maturity of which is on or prior to the
Redemption Date, shall be payable to Holders of record at the close of business
on the relevant Record Dates. On and after the Redemption Date interest shall
cease to accrue on Securities or portions thereof called for redemption.

 

SECTION 3.05.                                         Deposit
of Redemption Price.

 

With respect
to the Dollar Securities, prior to 10:00 a.m., New York time, on the Redemption
Date, the Issuer shall deposit with the Dollar Paying Agent (or, if the Issuer
or a Wholly Owned Subsidiary is a Paying Agent, shall segregate and hold in
trust) U.S. Legal Tender and/or U.S. Government Securities sufficient to pay
the redemption price of and accrued interest on all Dollar Securities or
portions thereof to be redeemed on that date other than Dollar Securities or
portions of Dollar Securities called for redemption that have been delivered by
the Issuer to the Trustee for cancellation. On and after the Redemption Date,
interest shall cease to accrue on Dollar Securities or portions thereof called
for redemption so long as the Issuer has deposited with the Dollar Paying Agent
funds sufficient to pay the principal of, plus accrued and unpaid interest on,
the Dollar Securities.

 

With respect
to the Sterling Securities, prior to 10:00 a.m., London time, on the Redemption
Date, the Issuer shall deposit with the Sterling Paying Agent (or, if the
Issuer or a Wholly Owned Subsidiary is a Paying Agent, shall segregate and hold
in trust) U.K. Legal Tender and/or U.K. Government Securities sufficient to pay
the redemption price of and accrued interest on all Sterling Securities or
portions thereof to be redeemed on that date other than Sterling Securities or
portions of Sterling Securities called for redemption that have been delivered
by the Issuer to the Trustee for cancellation. On and after the Redemption
Date, interest shall cease to accrue on Sterling Securities or portions thereof
called for redemption so long as the Issuer has deposited with the Sterling
Paying Agent funds sufficient to pay the principal of, plus accrued and unpaid
interest on, the Sterling Securities.

 

58

 

SECTION 3.06.                                         Securities
Redeemed in Part.

 

If any
Security is to be redeemed in part only, the notice of redemption that relates
to such Security shall state the portion of the principal amount thereof to be
redeemed. A new Security in principal amount equal to the unredeemed portion of
the original Security shall be issued in the name of the Holder thereof upon
cancellation of the original Security.

 

ARTICLE FOUR

 

COVENANTS

 

SECTION 4.01.                                         Payment
of Securities.

 

(a)           The Issuer shall pay the principal of
(and premium, if any) and interest on the Securities on the dates and in the
manner provided in the Securities and this Indenture. An installment of
principal of or interest on the Securities shall be considered paid on the date
it is due if the Trustee or Paying Agent (other than the Issuer or an Affiliate
thereof) holds on that date U.S. Legal Tender, U.K. Legal Tender, U.S.
Government Securities and/or U.K. Government Securities designated for and
sufficient to pay the installment. Interest on the Securities will be computed
on the basis of a 360-day year comprised of twelve 30-day months.

 

(b)           The Issuer shall pay interest on
overdue principal (including, without limitation, post petition interest in a
proceeding under any Bankruptcy Law), and overdue interest, to the extent
lawful, at the same rate per annum borne by
the Securities.

 

SECTION 4.02.                                         Maintenance
of Office or Agency.

 

(a)           The Issuer shall maintain the offices
or agencies required under Section 2.04. The Issuer shall give prompt written
notice to the Trustee of the location, and any change in the location, of such
offices or agencies.
If at any time the Issuer shall fail to maintain any such required office or
agency or shall fail to furnish the Trustee with the address thereof, such
presentations, surrenders, notices and demands may be made or served at the
address of the Trustee set forth in Section 12.02.

 

(b)           The Issuer may also from time to time
designate one or more other offices or agencies where the Securities may be
presented or surrendered for any or all such purposes and may from time to time
rescind such designations. The Issuer will give prompt written notice to the
Trustee of any such designation or rescission and of any change in the location
of any such other office or agency.

 

59

 

(c)           The Issuer hereby initially
designates the Corporate Trust Office of the Trustee as one such office or
agency of the Issuer in accordance with Section 2.04.

 

SECTION 4.03.                                         Corporate
Existence.

 

Except as
otherwise permitted by Article Five, the Issuer shall do or cause to be done
all things necessary to preserve and keep in full force and effect its
corporate existence in accordance with its organizational documents and the
rights (charter and statutory) and material franchises of the Issuer.

 

SECTION 4.04.                                         Payment
of Taxes and Other Claims.

 

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

 

SECTION 4.05.                                         Maintenance
of Properties and Insurance.

 

(a)             The Issuer shall cause all material
properties owned by or leased by it or any of its Restricted Subsidiaries used
or useful to the conduct of its business or the business of any of its
Restricted Subsidiaries to be maintained and kept in normal condition, repair
and working order and supplied with all necessary equipment and shall cause to
be made all repairs, renewals, replacements, and betterments thereof, all as in
its judgment may be necessary, so that the business carried on in connection
therewith may be properly and advantageously conducted at all times; provided, however, that
nothing in this Section 4.05 shall prevent the Issuer or any of its Restricted
Subsidiaries from discontinuing the use, operation or maintenance of any of
such properties, or disposing of any of them, if such discontinuance or
disposal is, in the judgment of the Board of Directors of the Issuer or any
such Restricted Subsidiary desirable in the conduct of the business of the
Issuer or any such Restricted Subsidiary; provided, further, that nothing in this
Section 4.05 shall prevent the Issuer or any of its Restricted Subsidiaries
from discontinuing or disposing of any properties to the extent otherwise
permitted by this Indenture.

 

(b)             The Issuer shall maintain, and
shall cause its Restricted Subsidiaries to maintain, insurance with responsible
carriers against such risks and in such amounts, and with such deductibles,
retentions, self insured amounts and co-insurance provisions, as are
appropriate

 

60

 

for a business of this type and
size as determined in good faith by the Issuer, including property and casualty
loss, workers’ compensation and interruption of business insurance.

 

SECTION 4.06.                                         Compliance
Certificate; Notice of Default.

 

(a)             The Issuer shall deliver to the
Trustee, within 90 days after the close of each fiscal year commencing with the
fiscal year ending November 30, 2004, an Officers’ Certificate stating that a
review of the activities of the Issuer and its Restricted Subsidiaries has been
made under the supervision of the signing Officers with a view to determining
whether the Issuer has kept, observed, performed and fulfilled its obligations
under this Indenture and further stating, as to each such Officer signing such
certificate, that to the best of such Officer’s knowledge, the Issuer during
such preceding fiscal year has kept, observed, performed and fulfilled each and
every such covenant and no Default occurred during such year and at the date of
such certificate there is no Default that has occurred and is continuing or, if
such signers do know of such Default, the certificate shall describe its status
with particularity. The Officers’ Certificate shall also notify the Trustee
should the Issuer elect to change the manner in which it fixes its fiscal year
end.

 

(b)             The Issuer shall deliver to the
Trustee as soon as possible, and in any event within five days after the Issuer
becomes aware of the occurrence of any Default, an Officers’ Certificate
specifying the Default and describing its status with particularity and the
action proposed to be taken thereto.

 

(c)             The Issuer’s fiscal years currently
end on November 30. The Issuer will provide written notice to the Trustee of
any change in its fiscal year.

 

SECTION 4.07.                                         Compliance
with Laws.

 

(a)             The Issuer shall comply, and shall
cause each of its Restricted Subsidiaries to comply, with all applicable
statutes, rules, regulations, orders and restrictions of the United States, all
states and municipalities thereof, and of any governmental department,
commission, board, regulatory authority, bureau, agency and instrumentality of
the foregoing, in respect of the conduct of their respective businesses and the
ownership of their respective properties, except, in any such case, to the
extent the failure to so comply would not, individually or in the aggregate, reasonably
be expected to have a material adverse effect on the business, financial
condition or results of operations of the Issuer and its Restricted
Subsidiaries taken as a whole.

 

SECTION 4.08.                                         Waiver
of Stay, Extension or Usury Laws.

 

The Issuer
covenants (to the extent permitted by applicable law) 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

 

61

 

the Issuer from paying all or
any portion of the principal of and/or interest on the Securities 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 permitted by applicable law) the Issuer hereby expressly waives all
benefit or advantage of any such law, and covenants that it will not hinder,
delay or impede the execution of any power herein granted to the Trustee, but
will suffer and permit the execution of every such power as though no such law
had been enacted.

 

SECTION 4.09.                                         Change
of Control.

 

(a)           If
a Change of Control occurs, each Holder will have the right to require the
Issuer to repurchase all or any part (equal to $5,000 or £5,000 or an integral
multiple of $1,000 or £1,000, as applicable) of that Holder’s Securities
pursuant to a Change of Control Offer (the “Change of Control Offer”) on the terms set forth in this
Indenture. In the Change of Control Offer, the Issuer will offer to pay an
amount in cash (the “Change of Control Payment”) equal to 101% of the aggregate
principal amount of Securities repurchased, plus accrued and unpaid interest
and Additional Interest thereon, if any, on the Securities re-purchased to the
date of purchase.

 

(b)           Within
30 days following any Change of Control, the Issuer will mail a notice to each
Holder describing the transaction or transactions that constitute the Change of
Control and offering to repurchase Securities on the date (the “Change of
Control Payment Date”) specified
in such notice, which date shall be a Business Day no earlier than 30 days and
no later than 60 days from the date such notice is mailed, pursuant to the
procedures required by this Indenture and described in such notice. Such notice
shall state:

 

(1)           that the Change of Control Offer is
being made pursuant to this Section 4.09 and that all Securities tendered and
not withdrawn will be accepted for payment;

 

(2)           the purchase price (including the
amount of accrued interest) and the Change of Control Payment Date;

 

(3)           that any Security not tendered will
continue to accrue interest;

 

(4)           that, unless the Issuer defaults in
making payment therefor, any Security accepted for payment pursuant to the
Change of Control Offer shall cease to accrue interest after the Change of
Control Payment Date;

 

(5)           that Holders electing to have a
Security purchased pursuant to a Change of Control Offer will be required to
surrender the Security, with the form entitled “Option of Holder to Elect
Purchase” on the reverse of the Security completed, to the 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;

 

62

 

(6)           that Holders will be entitled to
withdraw their election if the Paying Agent receives, not later than the second
Business Day prior to the Change of Control Payment Date, a telegram, facsimile
transmission or letter setting forth the name of the Holder, the principal
amount of the Securities the Holder delivered for purchase and a statement that
such Holder is withdrawing his election to have such Security purchased;

 

(7)           that Holders whose Securities are
purchased only in part will be issued new Securities in a principal amount
equal to the unpurchased portion of the Securities surrendered; and

 

(8)           the circumstances and relevant facts
regarding such Change of Control.

 

(c)           On or before the
Change of Control Payment Date, the Issuer will, to the extent lawful:

 

(1)           accept for payment all Securities or
portions thereof properly tendered pursuant to the Change of Control Offer;

 

(2)           deposit with the Paying Agent U.S.
Legal Tender, U.K. Legal Tender, U.S. Government Securities and/or U.K.
Government Securities sufficient to pay the Change of Control Payment in
respect of all Securities or portions thereof so tendered; and

 

(3)           deliver or cause to be delivered to
the Trustee the Securities properly accepted together with an Officers’
Certificate stating the aggregate principal amount of Securities or portions
thereof being purchased by the Issuer.

 

(d)           The Paying Agent
will promptly mail to each Holder of Securities properly tendered the Change of
Control Payment for such Securities, and the Trustee will promptly authenticate
and mail (or cause to be transferred by book entry) to each Holder a new
Security equal in principal amount to any unpurchased portion of the Securities
surrendered, if any; provided that
each such new Security will be in a principal amount of $5,000 or an integral
multiple of $1,000 in the case of the Dollar Securities, and in a principal
amount of £5,000 or an integral multiple of £1,000 in the case of the Sterling
Securities.

 

Prior to complying
with any of the provisions of this Section 4.09, but in any event within 90
days following a Change of Control, to the extent required to permit the Issuer
to comply with this Section 4.09, the Issuer will either repay all outstanding
Senior Debt or obtain the requisite consents, if any, under all agreements
governing outstanding Senior Debt. The Issuer will publicly announce the
results of the Change of Control Offer as soon as practicable after the Change
of Control Payment Date. However, if the Change of Control Payment Date is on
or after an interest record date and on or before the related interest payment

 

63

 

date, any accrued and unpaid
interest shall be paid to the Person in whose name a Security is registered at
the close of business on such record date, and no additional interest shall be
payable to Holders who tender Securities pursuant to the Change of Control
Offer.

 

(e)           Notwithstanding
the foregoing, the Issuer shall not be required to make a Change of Control
Offer, as provided above, if, in connection with or in contemplation of any
Change of Control, it or a third party has made an offer to purchase (an “Alternate
Offer”) any and
all Securities validly tendered at a cash price equal to or higher than the
Change of Control Payment and has purchased all Securities properly tendered in
accordance with the terms of such Alternate Offer. The Alternate Offer must
comply with all the other provisions applicable to the Change of Control Offer,
shall remain, if commenced prior to the Change of Control, open for acceptance
until the consummation of the Change of Control and must permit Holders to
withdraw any tenders of Securities made into the Alternate Offer until the
final expiration or consummation thereof.

 

(f)            The
Issuer will comply, and will cause any third party making a Change of Control
Offer or an Alternate Offer to 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 a
Change of Control Offer or an Alternate Offer. To the extent the provisions of
any applicable securities laws or regulations conflict with the provisions of
this Indenture relating to a Change of Control Offer, the Issuer will not be
deemed to have breached its obligations under this Indenture by virtue of
complying with such laws or regulations.

 

SECTION 4.10.                                         Incurrence
of Indebtedness and Issuance of Preferred Stock.

 

(a)           The
Issuer will not, and will not permit any of its Restricted Subsidiaries to,
directly or indirectly, create, incur, issue, assume, guarantee or otherwise
become directly or indirectly or directly liable, contingently or otherwise,
with respect to (collectively “incur”) any
Indebtedness (including Acquired Debt), and the Issuer will not permit any of
its Restricted Subsidiaries to issue any shares of Preferred Stock; provided, however, that
the Issuer and any Restricted Subsidiary that is a Guarantor may incur Indebtedness
(including Acquired Debt) and any Restricted Subsidiary that is a Guarantor may
issue Preferred Stock if the Fixed Charge Coverage Ratio for the Issuer’s most
recently ended four full fiscal quarters for which internal financial
statements are available immediately preceding the date on which such
additional Indebtedness is incurred or such Preferred Stock is issued would
have been at least 2.0 to 1, determined on a pro forma basis
(including a pro forma application of the net
proceeds therefrom) (the “Coverage Ratio Exception”), as if the additional Indebtedness
had been incurred or the Preferred Stock had been issued, as the case may be,
and the application of proceeds therefrom had occurred at the beginning of such
four-quarter period.

 

(b)           Section
4.10(a) will not prohibit the incurrence of any of the following (collectively,
“Permitted
Debt”):

 

64

 

(1)           the existence of
Indebtedness under the Credit Agreement together with the incurrence of the guarantees
thereunder and the issuance and creation of letters of credit and bankers’
acceptances thereunder (with letters of credit and bankers’ acceptances being
deemed to have a principal amount equal to the face amount thereof), up to an
aggregate principal amount, together with amounts outstanding under a Qualified
Securitization Financing incurred pursuant to clause (17) below, of $1,550.0
million outstanding at any one time, less the amount of all mandatory principal
payments (with respect to revolving borrowings and letters of credit, only to
the extent revolving commitments are correspondingly reduced) actually made by
the borrower thereunder in respect of Indebtedness thereunder with Net Proceeds
from Asset Sales;

 

(2)           the incurrence by the Issuer and the
Guarantors of Indebtedness represented by the Securities (including any
Guarantee) issued on the Issue Date;

 

(3)           Existing
Indebtedness (other than Indebtedness described in clauses (1) and (2) of this
Section 4.10(b));

 

(4)           Indebtedness
(including Capitalized Lease Obligations) incurred by the Issuer or any
Restricted Subsidiary to finance the purchase, lease or improvement of property
(real or personal) or equipment that is used or useful in a Permitted Business
(whether through the direct purchase of assets or the Capital Stock of any
Person owning such assets) in an aggregate principal amount that, when
aggregated with the principal amount of all other Indebtedness then outstanding
and incurred pursuant to this clause (4), does not exceed the greater of (x)
$50.0 million and (y) 4.0% of Consolidated Tangible Assets;

 

(5)           Indebtedness
incurred by the Issuer or any Restricted Subsidiary constituting reimbursement
obligations with respect to letters of credit issued in the ordinary course of
business, including without limitation letters of credit in respect of workers’
compensation claims, health, disability or other employee benefits or property,
casualty or liability insurance or self-insurance or other Indebtedness with
respect to reimbursement-type obligations regarding workers’ compensation
claims; provided, however, that upon the drawing of such
letters of credit or the incurrence of such Indebtedness, such obligations are
reimbursed within 30 days following such drawing or incurrence;

 

(6)           Indebtedness arising from agreements
of the Issuer or a Restricted Subsidiary providing for indemnification,
adjustment of purchase price or similar obligations, in each case, incurred or
assumed in connection with the disposition of any business, assets or a Subsidiary,
other than guarantees of Indebtedness incurred by any Person acquiring all or
any portion of such business, assets or a Subsidiary for the purpose of
financing such acquisition; provided, however, that (A) such
Indebtedness is not reflected on the balance sheet of the Issuer or any
Restricted Subsidiary (contingent

 

65

 

obligations
referred to in a footnote to financial statements and not otherwise reflected
on the balance sheet will not be deemed to be reflected on such balance sheet
for purposes of this clause (A)) and (B) the maximum assumable liability in
respect of all such Indebtedness shall at no time exceed the gross proceeds
including noncash proceeds (the fair market value of such noncash proceeds
being measured at the time received and without giving effect to any subsequent
changes in value) actually received by the Issuer and any Restricted
Subsidiaries in connection with such disposition;

 

(7)           Indebtedness of the
Issuer owed to and held by any Restricted Subsidiary or Indebtedness of a
Restricted Subsidiary owed to and held by the Issuer or any Restricted
Subsidiary; provided, however, that (A) any subsequent
issuance or transfer of any Capital Stock or any other event that results in any
such Restricted Subsidiary ceasing to be a Restricted Subsidiary or any
subsequent transfer of any such Indebtedness (except to the Issuer or a
Restricted Subsidiary) shall be deemed, in each case, to constitute the
incurrence of such Indebtedness by the issuer thereof and (B) if the Issuer is
the obligor on such Indebtedness, such Indebtedness is expressly subordinated
to the prior payment in full in cash of all obligations of the Issuer with
respect to the Securities;

 

(8)           shares of Preferred
Stock of a Restricted Subsidiary issued to the Issuer or a Restricted
Subsidiary; provided that any subsequent issuance or transfer
of any Capital Stock or any other event which results in any such Restricted
Subsidiary ceasing to be a Restricted Subsidiary or any other subsequent
transfer of any such shares of Preferred Stock (except to the Issuer or a
Restricted Subsidiary) shall be deemed in each case to be an issuance of such
shares of Preferred Stock;

 

(9)           Hedging Obligations
of the Issuer or any Restricted Subsidiary (excluding Hedging Obligations
entered into for speculative purposes) for the purpose of limiting (A) interest
rate risk with respect to any Indebtedness that is permitted by the terms of
this Indenture to be outstanding or (B) exchange rate risk with respect to any
currency exchange;

 

(10)         obligations in
respect of performance and surety bonds and performance and completion
guarantees provided by the Issuer or any Restricted Subsidiary or obligations
in respect of letters of credit related thereto, in each case in the ordinary
course of business or consistent with past practice;

 

(11)         Indebtedness of the Issuer or any
Restricted Subsidiary or Preferred Stock of any Restricted Subsidiary not
otherwise permitted hereunder in an aggregate principal amount or liquidation
preference which, when aggregated with the principal amount and liquidation
preference of all other Indebtedness and Preferred Stock then outstanding and
incurred pursuant to this clause (11), does not at any one time outstanding 

 

66

 

exceed $150.0
million (it being understood that any Indebtedness or Preferred Stock incurred
pursuant to this clause (11) shall cease to be deemed incurred or outstanding
for purposes of this clause (11) but shall be deemed incurred for the purposes
of Section 4.10(a) from and after the first date on which the Issuer or such
Restricted Subsidiary could have incurred such Indebtedness or Preferred Stock
under Section 4.10(a) without reliance on this clause (11));

 

(12)         any guarantee by the
Issuer or a Guarantor of Indebtedness or other obligations of the Issuer or any
Restricted Subsidiary so long as the incurrence of such Indebtedness incurred
by the Issuer or such Restricted Subsidiary is permitted under the terms of
this Indenture; provided that if such Indebtedness is by its
express terms subordinated in right of payment to the Securities or the
Guarantee of such Restricted Subsidiary, as applicable, any such guarantee of
such Guarantor with respect to such Indebtedness shall be subordinated in right
of payment to such Guarantor’s Guarantee with respect to the Securities
substantially to the same extent as such Indebtedness is subordinated to the
Securities or the Guarantee of such Restricted Subsidiary, as applicable;

 

(13)         the incurrence by the
Issuer or any Restricted Subsidiary of Indebtedness or Preferred Stock that
serves to refund or refinance any Indebtedness incurred as permitted by Section
4.10(a) and clauses (2), (3) and (4) above, this clause (13) and clause (14)
below or any Indebtedness issued to so refund or refinance such Indebtedness
including additional Indebtedness incurred to pay premiums and fees in
connection therewith (the “Refinancing Indebtedness”) prior to its respective maturity; provided, however, that
such Refinancing Indebtedness (A) has a Weighted Average Life to Maturity at
the time such Refinancing Indebtedness is incurred which is not less than the
remaining Weighted Average Life to Maturity of the Indebtedness being refunded
or refinanced, (B) to the extent such Refinancing Indebtedness refinances
Indebtedness subordinated or pari passu to the Securities, such Refinancing
Indebtedness is subordinated or pari passu to the Securities at least to the same
extent as the Indebtedness being refinanced or refunded, (C) shall not include
(x) Indebtedness or Preferred Stock of a Subsidiary that is not a Guarantor
that refinances Indebtedness or Preferred Stock of the Issuer or (y)
Indebtedness or Preferred Stock of the Issuer or a Restricted Subsidiary that
refinances Indebtedness or Preferred Stock of an Unrestricted Subsidiary, (D)
shall not be in a principal amount in excess of the principal amount of,
premium, if any, accrued interest on, and related fees and expenses of, the
Indebtedness being refunded or refinanced and (E) shall not have a stated
maturity date prior to the Stated Maturity of the Indebtedness being refunded
or refinanced; and provided,
further, that subclauses (A), (B) and (E) of this clause (13) will
not apply to any refunding or refinancing of any Senior Debt;

 

67

 

(14)         Indebtedness or Preferred Stock of
Persons that are acquired by the Issuer or any Restricted Subsidiary or merged
into the Issuer or a Restricted Subsidiary in accordance with the terms of this
Indenture; provided that such
Indebtedness or Preferred Stock is not incurred in connection with or in
contemplation of such acquisition or merger; and provided, further, that after giving effect to such incurrence of Indebtedness
either (A) the Issuer would be permitted to incur at least $1.00 of additional
Indebtedness pursuant to the Coverage Ratio Exception or (B) the Fixed Charge
Coverage Ratio would be greater than immediately prior to such acquisition;

 

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

 

(16)         Indebtedness of the
Issuer or any Restricted Subsidiary of the Issuer supported by a letter of
credit issued pursuant to the Credit Agreement in a principal amount not in
excess of the stated amount of such letter of credit;

 

(17)         Indebtedness incurred by a
Securitization Subsidiary in a Qualified Securitization Financing that is not
recourse to the Issuer or any Restricted Subsidiary of the Issuer other than a
Securitization Subsidiary (except for Standard Securitization Undertakings);

 

(18)         the incurrence of (A)
Non-Recourse Acquisition Financing Indebtedness and (B) Non-Recourse Product
Financing Indebtedness;

 

(19)         Contribution Indebtedness;

 

(20)         (a) if the Issuer
could incur $1.00 of additional Indebtedness pursuant to the Coverage Ratio
Exception after giving effect to such borrowing, Indebtedness of Foreign
Subsidiaries of the Issuer not otherwise permitted hereunder or (b) if the
Issuer could not incur $1.00 of additional Indebtedness pursuant to the
Coverage Ratio Exception hereof after giving effect to such borrowing,
Indebtedness of Foreign Subsidiaries of the Issuer incurred for working capital
purposes, provided, however, that the
aggregate principal amount of Indebtedness incurred under this clause (20)
which, when aggregated with the principal amount of all other Indebtedness then
outstanding and incurred pursuant to this clause (20), does not exceed the
greater of (x) $100.0 million and (y) 10% of the Consolidated Tangible Assets
of the Foreign Subsidiaries; and

 

(21)         Indebtedness consisting of promissory
notes issued by the Issuer or any Guarantor to current or former officers,
directors and employees or their respective estates,

 

68

 

spouses or
former spouses to finance the purchase or redemption of Equity Interests of
Holdco permitted by Section 4.11.

 

(c)           For purposes of determining
compliance with this Section 4.10, in the event that an item of proposed
Indebtedness meets the criteria of more than one of the categories of Permitted
Debt described in clauses (1) through (21) above, or is entitled to be incurred
pursuant to the first paragraph of this covenant, the Issuer will be permitted
to classify and later reclassify such item of Indebtedness in any manner that
complies with this covenant, and such item of Indebtedness will be treated as
having been incurred pursuant to only one of such categories. Accrual of
interest, the accretion of accreted value and the payment of interest in the
form of additional Indebtedness will not be deemed to be an incurrence of
Indebtedness for purposes of this covenant. Notwithstanding the foregoing,
Indebtedness under the Credit Agreement outstanding on the date on which
Securities are first issued and authenticated under this Indenture will be
deemed to have been incurred on such date in reliance on the exception provided
by clause (1) of the definition of “Permitted Debt” in Section 4.10(b) and the
Issuer shall not be permitted to reclassify all or any portion of such
Indebtedness. The maximum amount of Indebtedness that the Issuer and its
Restricted Subsidiaries may incur pursuant to this covenant shall not be deemed
to be exceeded, with respect to any outstanding Indebtedness, solely as a
result of fluctuations in the exchange rate of currencies.

 

SECTION 4.11.                                         Restricted
Payments.

 

(a)           The Issuer will not, and will not
permit any of its Restricted Subsidiaries to, directly or indirectly:

 

(A)          declare or pay any dividend or make
any other payment or distribution on account of the Issuer’s or any of its
Restricted Subsidiaries’ Equity Interests, including any dividend or
distribution payable in connection with any merger or consolidation (other than
(x) dividends or distributions by the Issuer payable in Equity Interests (other
than Disqualified Stock) of the Issuer or in options, warrants or other rights
to purchase such Equity Interests (other than Disqualified Stock) or (y)
dividends or distributions by a Restricted Subsidiary to the Issuer or any
other Restricted Subsidiary so long as, in the case of any dividend or
distribution payable on or in respect of any class or series of securities
issued by a Restricted Subsidiary other than a Wholly Owned Subsidiary, the
Issuer or a Restricted Subsidiary receives at least its pro rata share of such
dividend or distribution in accordance with its Equity Interests in such class
or series of securities);

 

(B)           purchase, redeem or otherwise acquire
or retire for value any Equity Interests of the Issuer or any direct or
indirect parent corporation of the Issuer, including in connection with any
merger or consolidation involving the Issuer;

 

69

 

(C)           make any principal payment on, or
redeem, repurchase, defease or otherwise acquire or retire for value, in each
case prior to any scheduled repayment, sinking fund payment or maturity, any
Indebtedness subordinated or junior in right of payment to the Securities (or,
as applicable, any Guarantees) (other than (x) Indebtedness permitted under
clauses (7) and (8) of the definition of “Permitted Debt” in Section 4.10(b) or
(y) the purchase, repurchase or other acquisition of Indebtedness subordinated
or junior in right of payment to the Securities, 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 purchase, repurchase or
acquisition); or

 

(D)          make any
Restricted Investment (all such payments and other actions set forth in these
clauses (A) through (D) being collectively referred to as “Restricted
Payments”),

 

unless, at the time of and
after giving effect to such Restricted Payment:

 

(1)           no Default or Event
of Default has occurred and is continuing or would occur as a consequence of
such Restricted Payment;

 

(2)           the Issuer would, at the time of such
Restricted Payment and after giving pro
forma effect thereto as if such Restricted Payment had
been made at the beginning of the applicable four-quarter period, have been
permitted to incur at least $1.00 of additional Indebtedness pursuant to the
Coverage Ratio Exception; and

 

(3)           such Restricted
Payment, together with the aggregate amount of all other Restricted Payments
made by the Issuer and the Restricted Subsidiaries after the Issue Date
(excluding Restricted Payments permitted by clauses (3), (4), (5), (6), (8),
(10), (11), (12), (13), (16) or (17) of Section 4.11(b)), is less than the sum,
without duplication, of

 

(a)           50% of the Consolidated Net Income of
the Issuer for the period (taken as one accounting period) from the beginning
of the first fiscal quarter commencing after the Issue Date to the end of the
Issuer’s most recently ended fiscal quarter for which internal financial
statements are available at the time of such Restricted Payment (or, in the
case such Consolidated Net Income for such period is a deficit, minus 100% of
such deficit), plus

 

(b)           100% of the aggregate net cash
proceeds and the fair market value, as determined in good faith by the Board of
Directors of the Issuer, of property and marketable securities received by the
Issuer after the Issue Date from the issue or sale of (x) Equity Interests of
the Issuer (including Retired Capital Stock) (but excluding (i) cash proceeds
and marketable securities received 

 

70

 

from Equity
Offerings to the extent used to redeem Securities in compliance with Section 6
of the Securities, (ii) cash proceeds and marketable securities received from
the sale of Equity Interests to members of management, directors or consultants
of the Issuer, any direct or indirect parent corporation of the Issuer and its
Subsidiaries after the Issue Date to the extent such amounts have been applied
to Restricted Payments made in accordance with clause (4) of Section 4.11(b)
and, to the extent actually contributed to the Issuer, Equity Interests of the
Issuer’s direct or indirect parent corporations, (iii) Designated Preferred
Stock and (iv) Disqualified Stock) or (y) debt securities of the Issuer that
have been converted into such Equity Interests of the Issuer (other than
Refunding Capital Stock or Equity Interests or convertible debt securities of
the Issuer sold to a Restricted Subsidiary or the Issuer, as the case may be,
and other than Disqualified Stock or Designated Preferred Stock or debt
securities that have been converted into Disqualified Stock or Designated
Preferred Stock), plus

 

(c)           100% of the aggregate amount of cash
and the fair market value, as determined in good faith by the Board of
Directors of the Issuer, of property and marketable securities contributed to
the capital of the Issuer after the Issue Date (other than (i) net cash
proceeds from Equity Offerings to the extent used to redeem Securities in
compliance with Section 6 of the Securities, (ii) by a Restricted Subsidiary,
(iii) any Excluded Contributions, (iv) any Disqualified Stock, (v) any
Designated Preferred Stock and (vi) the Cash Contribution Amount), plus

 

(d)           100% of the aggregate amount received
in cash and the fair market value, as determined in good faith by the Board of
Directors of the Issuer, of property and marketable securities received by
means of (A) the sale or other disposition (other than to the Issuer or a
Restricted Subsidiary) of Restricted Investments made by the Issuer or its
Restricted Subsidiaries and repurchases and redemptions of such Restricted
Investments from the Issuer or its Restricted Subsidiaries and repayments of
loans or advances which constitute Restricted Investments by the Issuer or its
Restricted Subsidiaries or (B) the sale (other than to the Issuer or a
Restricted Subsidiary) of the Capital Stock of an Unrestricted Subsidiary or a
distribution from an Unrestricted Subsidiary (other than in each case to the
extent the Investment in such Unrestricted Subsidiary was made by a Restricted
Subsidiary pursuant to clause (7) or (11) of Section 4.11(b) or to the extent
such Investment constituted a Permitted Investment) or a dividend from an
Unrestricted Subsidiary, plus

 

(e)           in the case of the redesignation of
an Unrestricted Subsidiary as a Restricted Subsidiary or the merger or consolidation
of an Unrestricted Subsidiary 

 

71

 

into the
Issuer or a Restricted Subsidiary or the transfer of assets of an Unrestricted
Subsidiary to the Issuer or a Restricted Subsidiary, the fair market value of the Investment
in such Unrestricted Subsidiary, as determined by the Board of Directors of the
Issuer in good faith at the time of the redesignation of such Unrestricted
Subsidiary as a Restricted Subsidiary or at the time of such merger,
consolidation or transfer of assets (other than an Unrestricted Subsidiary to
the extent the Investment in such Unrestricted Subsidiary was made by a
Restricted Subsidiary pursuant to clause (7) or (11) of Section 4.11(b) or to
the extent such Investment constituted a Permitted Investment).

 

(b)           Notwithstanding the foregoing, the
provisions set forth in Section 4.11(a) do not prohibit:

 

(1)           the payment of any
dividend within 60 days after the date of declaration thereof, if at the date
of declaration such payment would have complied with the provisions of this
Indenture;

 

(2)           (A) the redemption,
repurchase, retirement or other acquisition of any Equity Interests of the
Issuer or any direct or indirect parent corporation (“Retired Capital Stock”) or Indebtedness subordinated to
the Securities, in exchange for or out of the proceeds of the substantially
concurrent sale (other than to a Restricted Subsidiary or the Issuer) of Equity
Interests of the Issuer or any direct or indirect parent corporation thereof or
contributions to the equity capital of the Issuer (in each case, other than
Disqualified Stock) (“Refunding
Capital Stock”) and
(B) the declaration and payment of dividends on the Retired Capital Stock out
of the proceeds of the substantially concurrent sale (other than to a
Subsidiary of the Issuer or to an employee stock ownership plan or any trust
established by the Issuer or any of its Subsidiaries) of Refunding Capital
Stock;

 

(3)           the redemption, repurchase or other
acquisition or retirement of Indebtedness subordinated to the Securities made
by exchange for, or out of the proceeds of the substantially concurrent sale
of, new Indebtedness of the borrower thereof, which is incurred in compliance
with Section 4.10 so long as (A) the principal amount of such new Indebtedness
does not exceed the principal amount of the Indebtedness subordinated to the
Securities being so redeemed, repurchased, acquired or retired for value plus
related fees and expenses and the amount of any reasonable premium required to
be paid under the terms of the instrument governing the Indebtedness
subordinated to the Securities being so redeemed, repurchased, acquired or
retired, (B) such new Indebtedness is subordinated to such Securities and any
Guarantees thereof at least to the same extent as such Indebtedness
subordinated to such Securities so purchased, exchanged, redeemed, repurchased,
acquired or retired for value, (C) such new Indebtedness has a final scheduled maturity date equal to
or later than the final scheduled

 

72

 

maturity date
of the Indebtedness subordinated to such Securities being so redeemed,
repurchased, acquired or retired and (D) such new Indebtedness has a Weighted
Average Life to Maturity equal to or greater than the remaining Weighted
Average Life to Maturity of the Indebtedness subordinated to such Securities
being so redeemed, repurchased, acquired or retired;

 

(4)           a Restricted Payment
to pay for the repurchase, retirement or other acquisition or retirement for
value of common Equity Interests of the Issuer or any of its direct or indirect
parent corporations held by any future, present or former employee, director or
consultant of the Issuer, any of its Subsidiaries or any of its direct or
indirect parent corporations pursuant to any management equity plan or stock
option plan or any other management or employee benefit plan or agreement; provided, however, that the
aggregate amount of Restricted Payments made under this clause (4) does not
exceed in any calendar year $20.0 million (with unused amounts in any calendar
year being carried over to the two succeeding calendar years); and provided, further, that such
amount in any calendar year may be increased by an amount not to exceed (A) the
cash proceeds from the sale of Equity Interests (other than Disqualified Stock)
of the Issuer and, to the extent contributed to the Issuer, Equity Interests of
any of its direct or indirect parent corporations, in each case to members of management,
directors or consultants of the Issuer, any of its Subsidiaries or any of its
direct or indirect parent corporations that occurs after the Issue Date plus
(B) the amount of any cash bonuses otherwise payable to members of management,
directors or consultants of the Issuer or any of its Subsidiaries or any of its
direct or indirect parent corporations in connection with the Transactions that
are foregone in return for the receipt of Equity Interests of the Issuer or any
direct or indirect parent corporation of the Issuer pursuant to a deferred
compensation plan of such corporation plus (C) the cash proceeds of key man
life insurance policies received by the Issuer or its Restricted Subsidiaries
after the Issue Date (provided that the Issuer
may elect to apply all or any portion of the aggregate increase contemplated by
clauses (A), (B) and (C) above in any calendar year) less (D) the amount of any
Restricted Payments previously made pursuant to clauses (A), (B) and (C) of
this clause (4);

 

(5)           the declaration and
payment of dividends to holders of any class or series of Disqualified Stock of
the Issuer or any Restricted Subsidiary issued or incurred in accordance with
this Section 4.11 to the extent such dividends are included in the definition
of “Fixed Charges” for such entity;

 

(6)           the declaration and payment of
dividends or distributions to holders of any class or series of Designated
Preferred Stock (other than Disqualified Stock) issued after the Issue Date and
the declaration and payment of dividends to any direct or indirect parent
company of the Issuer, the proceeds of which will be used to fund the payment
of dividends to holders of any class or series of Designated Preferred Stock

 

73

 

(other than
Disqualified Stock) of any direct or indirect parent company of the Issuer
issued after the Issue Date; provided,
however, that (A) for the most recently ended four full
fiscal quarters for which internal financial statements are available
immediately preceding the date of issuance of such Designated Preferred Stock,
after giving effect to such issuance (and the payment of dividends or
distributions) on a pro forma basis, the Issuer would
have had a Fixed Charge Coverage Ratio of at least 2.00 to 1.00 and (B) the
aggregate amount of dividends declared and paid pursuant to this clause (6)
does not exceed the net cash proceeds actually received by the Issuer from any
such sale of Designated Preferred Stock (other than Disqualified Stock) issued
after the Issue Date;

 

(7)           Investments in Unrestricted
Subsidiaries having an aggregate fair market value, taken together with all
other Investments made pursuant to this clause (7) that are at the time
outstanding, without giving effect to the sale of an Unrestricted Subsidiary to
the extent the proceeds of such sale do not consist of cash and/or marketable
securities, not to exceed the greater of $25.0 million and 2.0% of Consolidated
Tangible Assets at the time of such Investment (with the fair market value of
each Investment being measured at the time made and without giving effect to
subsequent changes in value);

 

(8)           repurchases of Equity Interests
deemed to occur upon exercise of stock options or warrants if such Equity
Interests represent a portion of the exercise price of such options or
warrants;

 

(9)           the payment of dividends on the
Issuer’s common stock following the first public offering of the Issuer’s
common stock or the common stock of any of its direct or indirect parent
corporations after the Issue Date, of up to 6% per annum of the net cash
proceeds received by or contributed to the Issuer in any past or future public
offering, other than public offerings with respect to the Issuer’s common stock
registered on Form S-8 and other than any public sale constituting an Excluded
Contribution;

 

(10)         Investments that are made with Excluded
Contributions;

 

(11)         other Restricted Payments in an
aggregate amount not to exceed $45.0 million;

 

(12)         the declaration and payment of
dividends to, or the making of loans to, Holdco in amounts required for it to
pay:

 

(A)          franchise taxes and
other fees, taxes and expenses required to maintain its corporate existence;

 

74

 

(B)           federal, state and
local income taxes to the extent such income taxes are attributable to the
income of the Issuer and the Restricted Subsidiaries and, to the extent of the
amount actually received from the Unrestricted Subsidiaries, in amounts
required to pay such taxes to the extent attributable to the income of the
Unrestricted Subsidiaries, provided, however, that in each case the
amount of such payments in any fiscal year does not exceed the amount that the
Issuer and the Restricted Subsidiaries would be required to pay in respect of
federal, state and local taxes for such fiscal year were the Issuer and the
Restricted Subsidiaries to pay such taxes as a stand-alone taxpayer;

 

(C)           customary salary,
bonus and other benefits payable to officers and employees of any direct or
indirect parent corporation of the Issuer to the extent such salaries, bonuses
and other benefits are attributable to the ownership or operation of the Issuer
and its Restricted Subsidiaries;

 

(D)          general corporate
overhead expenses (including professional expenses) for all direct or indirect
parent corporations of the Issuer to the extent such expenses are solely
attributable to the ownership or operation of the Issuer and its Restricted
Subsidiaries; and

 

(E)           fees and expenses
other than to Affiliates related to any unsuccessful equity or debt offering
permitted by this Indenture;

 

(13)         cash dividends or other distributions
on Holdco’s, the Issuer’s or any Restricted Subsidiary’s Capital Stock used to,
or the making of loans, the proceeds of which will be used to, fund the payment
of fees and expenses incurred in connection with the Transactions, or owed to
Affiliates, in each case to the extent permitted by Section 4.14;

 

(14)         distributions or payments of
Securitization Fees and purchases of Securitization Assets pursuant to a
Securitization Repurchase Obligation in connection with a Qualified
Securitization Financing;

 

(15)         the repurchase, redemption or other
acquisition or retirement for value of any Subordinated Indebtedness pursuant
to Sections 4.09 and 4.13; provided that a Change of Control Offer or
Asset Sale Offer, as applicable, has been made and all Securities tendered by
Holders in connection with a Change of Control Offer or Asset Sale Offer, as
applicable, have been repurchased, redeemed or acquired for value;

 

(16)         any Restricted Payment at any time
prior to April 15, 2009 if immediately after giving pro forma effect
to such Restricted Payment pursuant to this clause (16) and the incurrence of
any Indebtedness the net proceeds of which are used to finance such Restricted
Payment:

 

75

 

(A)          the Net Indebtedness
to EBITDA Ratio of the Issuer would not have exceeded 3.75 to 1; and

 

(B)           the Net Senior
Indebtedness to EBITDA Ratio of the Issuer would not have exceeded 2.50 to 1;
or

 

(17)         the declaration and
payment of dividends to Holdco of up to $200.0 million of the net proceeds
received by the Issuer from the sale of Securities on the Issue Date, the
proceeds of which will be used as described in the Offering Memorandum;

 

provided,
however, that at the time of, and after giving effect to, any
Restricted Payment permitted under clauses (2), (5), (6), (7), (9), (11), (14),
(15) and (16) above, no Default or Event of Default shall have occurred and be
continuing or would occur as a consequence thereof.

 

(c)           The
amount of all Restricted Payments (other than cash) will be the fair market
value on the date of the Restricted Payment of the asset(s) or securities
proposed to be transferred or issued by the Issuer or such Subsidiary, as the
case may be, pursuant to the Restricted Payment. The fair market value of any
assets or securities that are required to be valued by this Section 4.11 will
be determined in good faith by the Board of Directors of the Issuer. The Issuer’s
determination must be based upon an opinion or appraisal issued by an
Independent Financial Advisor if the fair market value exceeds $25.0 million.

 

(d)           As
of the Issue Date, all of the Issuer’s Subsidiaries will be Restricted
Subsidiaries. The Issuer will not permit any Unrestricted Subsidiary to become
a Restricted Subsidiary except pursuant to the second to last sentence of the
definition of “Unrestricted Subsidiary.” For purposes of designating any
Restricted Subsidiary as an Unrestricted Subsidiary, all outstanding investments
by the Issuer and the Restricted Subsidiaries (except to the extent repaid) in
the Subsidiary so designated will be deemed to be Restricted Payments in an
amount determined as set forth in the second paragraph of the definition of “Investments.”
Such designation will be permitted only if a Restricted Payment in such amount
would be permitted at such time under this Section 4.11 or the definition of “Permitted
Investments” and if such Subsidiary otherwise meets the definition of an “Unrestricted
Subsidiary.” Unrestricted Subsidiaries will not be subject to any of the
restrictive covenants described in this Indenture.

 

SECTION 4.12.                                         Liens.

 

(a)           The
Issuer will not, and will not permit any Restricted Subsidiary to, directly or
indirectly, create, incur, assume or suffer to exist any Lien (other than
Permitted Liens) that secures obligations under any Indebtedness ranking pari passu with
or subordinated to the Securities or a related Guarantee of the Issuer on any
asset or property of the Issuer 

 

76

 

or any Restricted Subsidiary,
or any income or profits therefrom, or assign or convey any right to receive
income therefrom, unless:

 

(1)           in the case of Liens securing
Indebtedness subordinated to the Securities, the Securities and any related
Guarantees are secured by a Lien on such property, assets or proceeds that is
senior in priority to such Liens; or

 

(2)           in all other cases, the Securities
are equally and ratably secured,

 

(b)           Notwithstanding the
foregoing, Section 4.12(a) shall not apply to:

 

(i)            Liens existing on the Issue Date to
the extent and in the manner such Liens are in effect on the Issue Date;

 

(ii)           Liens securing the Securities and the
related Guarantees, Liens securing Senior Debt and the related guarantees of
such Senior Debt; and

 

(iii)          Permitted Liens.

 

SECTION 4.13.                                         Asset
Sales.

 

(a)           The Issuer will not, and will not
permit any of its Restricted Subsidiaries to, consummate an Asset Sale unless:

 

(1)           the Issuer (or such Restricted
Subsidiary, as the case may be) receives consideration at the time of the Asset
Sale at least equal to the fair market value of the assets or Equity Interests
issued or sold or otherwise disposed of;

 

(2)           in the case of Asset Sales involving
consideration in excess of $10.0 million, the fair market value is determined
by the Issuer’s Board of Directors and evidenced by a Board Resolution set
forth in an Officers’ Certificate delivered to the Trustee; and

 

(3)           except for any Permitted Asset Swap,
at least 75% of the consideration received in the Asset Sale by the Issuer or
such Restricted Subsidiary is in the form of cash or Cash Equivalents.

 

For purposes of clause (2)
above, the amount of (i) any liabilities (as shown on the Issuer’s or such
Restricted Subsidiary’s most recent balance sheet or in the notes thereto) of
the Issuer or any Restricted Subsidiary (other than liabilities that are by
their terms subordinated to the Securities) that are assumed by the transferee
of any such assets and from which the Issuer and all Restricted
Subsidiaries have been validly released by all creditors in writing, (ii) any
securities received by the Issuer or such Restricted Subsidiary from such
transferee that are converted by the Issuer or such Restricted Subsidiary into
cash (to the extent of the cash received)

 

77

 

within 180 days following the
closing of such Asset Sale and (iii) any Designated Noncash Consideration
received by the Issuer or any of its Restricted Subsidiaries in such Asset Sale
having an aggregate fair market value (as determined in good faith by the Board
of Directors of the Issuer), taken together with all other Designated Noncash
Consideration received pursuant to this clause (iii) that is at that time
outstanding, not to exceed the greater of (x) $75.0 million and (y) 5.0% of
Consolidated Tangible Assets at the time of the receipt of such Designated
Noncash Consideration (with the fair market value of each item of Designated
Noncash Consideration being measured at the time received without giving effect
to subsequent changes in value), shall be deemed to be cash for purposes of
this paragraph and for no other purpose.

 

(b)           Within 365 days after the receipt of
any Net Proceeds from an Asset Sale, the Issuer may apply those Net Proceeds at
its option:

 

(1)           to permanently reduce Obligations
under Senior Debt of the Issuer (and to correspondingly reduce commitments with
respect thereto) or Indebtedness of the Issuer that ranks pari passu with
the Securities (provided
that if the Issuer shall so reduce Obligations under such
Indebtedness of the Issuer that ranks pari passu with the Securities, it will equally
and ratably reduce Obligations under the Securities by making an offer (in
accordance with the procedures set forth below for an Asset Sale Offer) to all
Holders to purchase at a purchase price equal to 100% of the principal amount
thereof, plus accrued and unpaid interest and Additional Interest, if any, the pro rata principal
amount of Securities) or Indebtedness of a Restricted Subsidiary, in each case,
other than Indebtedness owed to the Issuer or an Affiliate of the Issuer;

 

(2)           to an investment in (A) any one or
more businesses; provided that such investment in any business is
in the form of the acquisition of Capital Stock and results in the Issuer or a
Restricted Subsidiary owning an amount of the Capital Stock of such business
such that it constitutes a Restricted Subsidiary, (B) capital expenditures or
(C) other assets, in each of (A), (B) and (C), used or useful in a Permitted
Business; and/or

 

(3)           to an investment in (A) any one or
more businesses; provided that such investment in any business is
in the form of the acquisition of Capital Stock and it results in the Issuer or
a Restricted Subsidiary owning an amount of the Capital Stock of such business
such that it constitutes a Restricted Subsidiary, (B) properties or (C) assets
that, in each of (A), (B) and (C), replace the businesses, properties and
assets that are the subject of such Asset Sale.

 

(c)           When the aggregate amount of Net
Proceeds not applied or invested in accordance with the preceding paragraph (“Excess
Proceeds”) exceeds $20.0 million, the Issuer will make an
offer (an “Asset Sale Offer”) to all
Holders and holders of Indebtedness that ranks pari passu with the Securities and
contains provisions similar to those set forth in

 

78

 

this Indenture with respect to
offers to purchase with the proceeds of sales of assets to purchase, on a pro
rata basis, the maximum principal amount of Securities and
such other pari passu Indebtedness that may be purchased out
of the Excess Proceeds (the “Asset Sale Offer Amount”). The offer price in any Asset Sale
Offer will be equal to 100% of principal amount thereof, plus accrued and
unpaid interest and Additional Interest, if any, to the date of purchase (the “Asset Sale
Payment”), and
will be payable in cash.

 

(d)           Pending the final application of any
Net Proceeds, the Issuer may temporarily reduce revolving credit borrowings or
otherwise invest the Net Proceeds in any manner that is not prohibited by this
Indenture.

 

(e)           If any Excess Proceeds remain after
consummation of an Asset Sale Offer, the Issuer may use those Excess Proceeds
for any purpose not otherwise prohibited by this Indenture. If the aggregate
principal amount of Securities tendered into such Asset Sale Offer exceeds the
amount of Excess Proceeds, the Trustee will select the Securities to be
purchased on a pro rata basis. Upon completion of each Asset
Sale Offer, the amount of Excess Proceeds will be reset at zero.

 

(f)            Upon the commencement of an Asset
Sale Offer, the Issuer shall send, by first class mail, a notice to the Trustee
and to each Holder at its registered address. The notice shall contain all instructions
and materials necessary to enable such Holder to tender Securities pursuant to
the Asset Sale Offer. Any Asset Sale Offer shall be made to all Holders. The
notice, which shall govern the terms of the Asset Sale Offer, shall state:

 

(1)           that the Asset Sale Offer is being
made pursuant to this Section 4.13;

 

(2)           the Asset Sale
Offer Amount, the Asset Sale Payment and the date on which Securities tendered
and accepted for payment shall be purchased, which date shall be at least 30
days and no later than 60 days from the date such notice is mailed (the “Asset Sale
Payment Date”);

 

(3)           that any Securities not tendered or
accepted for payment shall continue to accrete or accrue interest;

 

(4)           that, unless the Issuer defaults in
making such payment, any Securities accepted for payment pursuant to the Asset
Sale Offer shall cease to accrete or accrue interest after the Asset Sale
Payment Date;

 

(5)           that Holders electing to have a
Security purchased pursuant to the Asset Sale Offer may only elect to have all
of such Security purchased and may not elect to have only a portion of such
Security purchased;

 

79

 

(6)           that Holders electing to have a
Security purchased pursuant to any Asset Sale Offer shall be required to
surrender the Security, with the form entitled “Option of Holder To Elect
Purchase” on the reverse of the Securities completed, or transfer such Security
by book-entry transfer, to the Issuer, a depository, if appointed by the
Issuer, or the Paying Agent at the address specified in the notice at least
three days before the Asset Sale Payment Date;

 

(7)           that Holders shall
be entitled to withdraw their election if the Issuer, the Depositary or the
Paying Agent, as the case may be, receives, not later than the Asset Sale
Payment Date, a notice setting forth the name of the Holder, the principal
amount of the Security the Holder delivered for purchase and a statement that
such Holder is withdrawing his election to have such Security purchased;

 

(8)           that, if the
aggregate principal amount of Securities surrendered by Holders exceeds the
Asset Sale Offer Amount, the Issuer shall select the Securities to be purchased
on a pro
rata basis (with such adjustments as may be deemed
appropriate by the Issuer so that only Securities in denominations of $5,000 or
£5,000 or integral multiples of $1,000 or £1,000 shall be purchased); and

 

(9)           that Holders whose
Securities were purchased only in part shall be issued new Securities equal in
principal amount to the unpurchased portion of the Securities surrendered (or
transferred by book-entry transfer); provided that
such Securities shall be in denominations of $5,000 or £5,000 or integral
multiples $1,000 or £1,000.

 

(g)           On the Asset Sale Payment Date, the
Issuer shall, to the extent lawful: (1) accept for payment all Securities or
portions thereof properly tendered pursuant to the Asset Sale Offer; (2)
deposit with the Paying Agent U.S. Legal Tender, U.K. Legal Tender, U.S.
Government Securities and/or U.K. Government Securities sufficient to pay the
Asset Sale Payment in respect of all Securities or portions thereof so
tendered; and (3) deliver or cause to be delivered to the Trustee the
Securities so accepted together with an Officers’ Certificate stating the
aggregate principal amount of Securities or portions thereof being repurchased
by the Issuer. The Issuer shall publicly announce the results of the Asset Sale
Offer on the Asset Sale Payment Date.

 

(h)           The Paying Agent shall promptly mail
to each Holder so tendered the Asset Sale Payment for such Securities, and the
Trustee shall promptly authenticate pursuant to an Authentication Order and
mail (or cause to be transferred by book entry) to each Holder a new Security
equal in principal amount to any unrepurchased portion of the Securities
surrendered, if any; provided that each such new
Security shall be in a principal amount of $5,000 or £5,000 or an integral
multiple of $1,000 or £1,000. However, if the Asset Sale Payment Date is on or
after an interest record date and on or before the related interest payment
date, any accrued and unpaid interest shall be paid to the Person in whose name
a Security

 

80

 

is registered at the close of
business on such record date, and no additional interest shall be payable to
Holders who tender Securities pursuant to the Asset Sale Offer.

 

(i)            The Issuer will comply with the
requirements of Rule 14e-1 under the Exchange Act and any other securities laws
and regulations thereunder to the extent those laws and regulations are
applicable in connection with each repurchase of Securities pursuant to an
Asset Sale Offer. To the extent that the provisions of any securities laws or
regulations conflict with this Section 4.13, the Issuer will comply with the
applicable securities laws and regulations and will not be deemed to have
breached its obligations under this Section 4.13 by virtue of such conflict.

 

SECTION 4.14.                                         Transactions
with Affiliates.

 

(a)           The Issuer will not, and will not
permit any of its Restricted Subsidiaries to, make any payment to, or sell,
lease, transfer or otherwise dispose of any of its properties or assets to, or
purchase any property or assets from, or enter into or make or amend any
transaction, contract, agreement, understanding, loan, advance or guarantee
with, or for the benefit of, any Affiliate (each, an “Affiliate Transaction”) involving
aggregate consideration in excess of $5.0 million, unless:

 

(1)           the Affiliate Transaction is on terms
that are no less favorable to the Issuer or the relevant Restricted Subsidiary
than those that would have been obtained in a comparable transaction by the
Issuer or such Restricted Subsidiary with an unrelated Person; and

 

(2)           the Issuer delivers to the Trustee:

 

(a)           with respect to any Affiliate
Transaction or series of related Affiliate Transactions involving aggregate
consideration in excess of $15.0 million, a Board Resolution approving such
Affiliate Transaction set forth in an Officers’ Certificate certifying that
such Affiliate Transaction complies with this Section 4.14 and that such
Affiliate Transaction has been approved by a majority of the disinterested
members of the Board of Directors; and

 

(b)           with respect to any Affiliate
Transaction or series of related Affiliate Transactions involving aggregate
consideration in excess of $75.0 million, an opinion as to the fairness to the
Issuer of such Affiliate Transaction from a financial point of view issued by
an Independent Financial Advisor.

 

(b)           The restrictions set forth in Section
4.14(a) do not apply to:

 

81

 

(1)           transactions between or among the
Issuer and/or any Restricted Subsidiary or any entity that becomes a Restricted
Subsidiary as a result of such transaction;

 

(2)           Restricted Payments (other than
pursuant to clause (7) of Section 4.10(b)) and Permitted Investments (other
than pursuant to clauses (10), (11) and (15) of the definition thereof)
permitted by this Indenture;

 

(3)           the payment to the
Sponsors and any of their Affiliates of annual management, consulting,
monitoring and advisory fees pursuant to the Management Agreement in an
aggregate amount in any fiscal year not to exceed $10.0 million and related
reasonable expenses;

 

(4)           the payment of reasonable and
customary fees paid to, and indemnities provided on behalf of, officers,
directors, employees or consultants of the Issuer, any of its direct or
indirect parent corporations or any Restricted Subsidiary;

 

(5)           the payments by the
Issuer or any Restricted Subsidiary to the Sponsors and any of their Affiliates
made for any financial advisory, financing, underwriting or placement services
or in respect of other investment banking activities, including, without
limitation, in connection with acquisitions or divestitures, which payments are
approved by a majority of the members of the Board of Directors of the Issuer
in good faith;

 

(6)           transactions in
which the Issuer or any Restricted Subsidiary delivers to the Trustee a letter
from an Independent Financial Advisor stating that such transaction is fair to
the Issuer or such Restricted Subsidiary from a financial point of view;

 

(7)           payments or loans
(or cancellations of loans) to employees or consultants of the Issuer or any of
its direct or indirect parent corporations or any Restricted Subsidiary which
are approved by a majority of the Board of Directors of the Issuer in good
faith and which are otherwise permitted under this Indenture;

 

(8)           payments made or
performance under any agreement as in effect on the Issue Date (other than the
Management Agreement and Stockholders Agreement, but including, without
limitation, each of the other agreements entered into in connection with the
Transactions) or any amendment thereto (so long as any such amendment is not
less advantageous to the Holders in any material respect than the original
agreement as in effect on the Issue Date);

 

(9)           the existence of, or the performance
by the Issuer or any of its Restricted Subsidiaries of its obligations under
the terms of, the Stockholders Agreement (including any registration rights
agreement or purchase agreements related thereto to

 

82

 

which it is a
party as of the Issue Date and any similar agreement that it may enter into
thereafter); provided, however, that the existence of, or the
performance by the Issuer or any of its Restricted Subsidiaries of its
obligations under, any future amendment to the Stockholders Agreement or under
any similar agreement entered into after the Issue Date shall only be permitted
by this clause (9) to the extent that the terms of any such existing agreement,
together with all amendments thereto, taken as a whole, or new agreement are
not otherwise more disadvantageous to Holders in any material respect than the
original agreement as in effect on the Issue Date;

 

(10)         the Transactions and the payment of all
fees and expenses related to the Transactions and the prepayment of $10.0
million in management fees for the fiscal year ended November 30, 2004;

 

(11)         transactions with customers, clients,
suppliers, or purchasers or sellers of goods or services, in each case in the
ordinary course of business and otherwise in compliance with the terms of this
Indenture that are fair to Holdco or the Restricted Subsidiaries, in the reasonable
determination of the members of the Board of Directors of the Issuer or the
senior management thereof, or are on terms at least as favorable as might
reasonably have been obtained at such time from an unaffiliated party;

 

(12)         if otherwise permitted hereunder, the
issuance of Equity Interests (other than Disqualified Stock) of Holdco to any
Permitted Holder or to any director, officer, employee or consultant of the
Issuer or Holdco or their Subsidiaries or of the Issuer to Holdco or to any
Permitted Holder or to any director, officer, employee or consultant of the
Issuer or Holdco or their Subsidiaries; and

 

(13)         any transaction with a Securitization
Subsidiary effected as part of a Qualified Securitization Financing.

 

SECTION 4.15.                                         Dividend
and Other Payment Restrictions Affecting Subsidiaries.

 

(a)           The Issuer will not, and will not
permit any of its Restricted Subsidiaries to, directly or indirectly, create or
permit to exist or become effective any consensual encumbrance or restriction
on the ability of any such Restricted Subsidiary to:

 

(1)           pay dividends or make any other
distributions on its Capital Stock to the Issuer or any of its Restricted
Subsidiaries, or with respect to any other interest or participation in, or
measured by, its profits, or pay any Indebtedness owed to the Issuer or any of
its Restricted Subsidiaries;

 

(2)           make loans or advances to the Issuer
or any of its Restricted Subsidiaries; or

 

83

 

(3)           sell, lease or
transfer any of its properties or assets to the Issuer or any of its Restricted
Subsidiaries.

 

(b)           However, the preceding restrictions
in Section 4.15(a) will not apply to encumbrances or restrictions existing
under or by reason of:

 

(1)           contractual encumbrances or restrictions
in effect (x) pursuant to the Credit Agreement or related documents or (y) on
the Issue Date, including, without limitation, pursuant to Existing
Indebtedness and its related documentation;

 

(2)           this Indenture and the Securities;

 

(3)           purchase money obligations
for property acquired in the ordinary course of business that impose
restrictions of the nature discussed in clause (3) of Section 4.15(a) on the
property so acquired;

 

(4)           applicable law or any applicable
rule, regulation or order;

 

(5)           any agreement or
other instrument of a Person acquired by the Issuer or any Restricted
Subsidiary in existence at the time of such acquisition (but not created in
contemplation thereof), which encumbrance or restriction is not applicable to
any Person, or the properties or assets of any Person, other than the Person,
or the property or assets of the Person, so acquired;

 

(6)           contracts for the
sale of assets, including, without limitation, customary restrictions with
respect to a Subsidiary pursuant to an agreement that has been entered into for
the sale or disposition of all or substantially all of the Capital Stock or
assets of such Subsidiary;

 

(7)           secured Indebtedness
otherwise permitted to be incurred pursuant to Sections 4.10 and 4.12 that
limits the right of the debtor to dispose of the assets securing such
Indebtedness;

 

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

 

(9)           other Indebtedness or Preferred Stock
(i) of the Issuer or any Restricted Subsidiary that is a Guarantor that is
incurred subsequent to the Issue Date pursuant to Section 4.10 or (ii) that is
incurred by a Foreign Subsidiary of the Issuer subsequent to the Issue Date
pursuant to clause (1), (4), (11) or (20) of Section 4.10(b);

 

(10)         customary provisions in joint venture
agreements and other similar agreements entered into in the ordinary course of
business;

 

84

 

(11)         customary provisions contained in leases,
subleases, licenses or asset sale agreements and other agreements;

 

(12)         any encumbrances or restrictions of the
type referred to in clauses (1), (2) and (3) of Section 4.15(a) imposed by any
amendments, modifications, restatements, renewals, increases, supplements,
refundings, replacements or refinancings of the contracts, instruments or
obligations referred to in clauses (I) through (11) of this Section 4.15(b), provided that
such amendments, modifications, restatements, renewals, increases, supplements,
refundings, replacements or refinancings are, in the good faith judgment of the
Issuer’s Board of Directors, no more restrictive with respect to such dividend
and other payment restrictions than those contained in the dividend or other
payment restrictions prior to such amendment, modification, restatement,
renewal, increase, supplement, refunding, replacement or refinancing;

 

(13)         any encumbrance or restriction of a
Securitization Subsidiary effected in connection with a Qualified
Securitization Financing; provided, however, that such restrictions
apply only to such Securitization Subsidiary; or

 

(14)         any encumbrance or restriction in
connection with Non-Recourse Product Financing Indebtedness or Non-Recourse
Acquisition Financing Indebtedness.

 

SECTION 4.16.                                         Additional
Subsidiary Guarantees.

 

(a)           The Issuer will cause each Restricted Subsidiary
that is a Domestic Subsidiary (unless such Subsidiary is a Securitization
Subsidiary) that:

 

(1)           guarantees any
Indebtedness of the Issuer or any of its Restricted Subsidiaries; or

 

(2)           incurs any
Indebtedness or issues any shares of Preferred Stock permitted to be incurred
or issued pursuant to clause (1) or (11) of the definition of “Permitted Debt”
in Section 4.10(b) or not permitted to be incurred by Section 4.10

 

to execute and deliver to the
Trustee a supplemental indenture pursuant to which such Subsidiary will
guarantee payment of the Securities. Each Guarantee will be limited to an
amount not to exceed the maximum amount that can be guaranteed by that Restricted
Subsidiary without rendering the Guarantee, as it relates to such Restricted
Subsidiary, voidable under applicable law relating to fraudulent conveyance or
fraudulent transfer or similar laws affecting the rights of creditors
generally.

 

(b)           Each Guarantee shall be released in
accordance with Article Eleven.

 

85

 

SECTION 4.17.                                         Reports
to Holders.

 

(a)           Whether or not required by the
Commission, so long as any Securities are outstanding, the Issuer will furnish
to the Holders, within the time periods specified in the Commission’s rules and
regulations:

 

(1)           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 Issuer were required to file
such Forms, including a “Management’s Discussion and Analysis of Financial
Condition and Results of Operations” and, with respect to the annual
information only, a report on the annual financial statements by the Issuer’s
certified independent accountants; and

 

(2)           all current reports
that would be required to be filed with the Commission on Form 8-K if the
Issuer were required to file such reports.

 

(b)           In addition, whether or not required
by the Commission, the Issuer will file a copy of all of the 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 Issuer has agreed that, for so long as any Securities
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.

 

(c)           In addition, if at any time Holdco
becomes a Guarantor (there being no obligation of Holdco to do so), holds no
material assets other than cash, Cash Equivalents and the Capital Stock of the
Issuer (and performs the related incidental activities associated with such
ownership) and complies with the requirements of Rule 3-10 of Regulation S-X
promulgated by the Commission (or any successor provision), the
reports, information and other documents required to be filed and furnished to
Holders pursuant to this Section 4.17 may, at the option of the Issuer, be
filed by and be those of Holdco rather than the Issuer.

 

(d)           Notwithstanding the foregoing, such
requirements shall be deemed satisfied prior to the commencement of the
Exchange Offer or the effectiveness of the Shelf Registration Statement (as
defined in the Registration Rights Agreement) by the filing with the Commission
of the Exchange Offer Registration Statement (as defined in the Registration
Rights Agreement) and/or Shelf Registration Statement, and any amendments
thereto, with such financial information that satisfies Regulation S-X of the
Securities Act.

 

86

 

SECTION 4.18.                                         Limitation
on Layering.

 

The Issuer
will not, and will not permit any Restricted Subsidiary that is a Guarantor to,
directly or indirectly, incur any Indebtedness that is or purports to be by its
terms (or by the terms of any agreement governing such Indebtedness)
contractually subordinated or junior in right of payment to any Senior Debt
(including Acquired Debt) of the Issuer or such Restricted Subsidiary, as the
case may be, unless such Indebtedness is either

 

(1)           pari passu in
right of payment with the Securities; or

 

(2)           subordinate in right of payment to
the Securities.

 

SECTION 4.19.                                         Business
Activities.

 

The Issuer
will not, and will not permit any Restricted Subsidiary (other than a
Securitization Subsidiary) to, engage in any business other than Permitted
Businesses, except to such extent as would not be material to the Issuer and
its Subsidiaries taken as a whole.

 

SECTION 4.20.                                         Payments
for Consent.

 

The Issuer
will not, and will not permit any of its Subsidiaries to, directly or
indirectly, pay or cause to be paid any consideration to or for the benefit of
any Holder for or as an inducement to any consent, waiver or amendment of any
of the terms or provisions of this Indenture or the Securities unless such
consideration is offered to be paid and is paid to all Holders that consent,
waive or agree to amend in the time frame set forth in the solicitation
documents relating to such consent, waiver or agreement.

 

ARTICLE FIVE

 

SUCCESSOR CORPORATION

 

SECTION 5.01.                                         Merger,
Consolidation, or Sale of Assets.

 

(a)           The Issuer may not, directly or
indirectly: (1) consolidate or merge with or into another Person (whether or
not the Issuer is the surviving corporation); or (2) sell, assign, transfer,
convey or otherwise dispose of all or substantially all of the properties or
assets of the Issuer and its Subsidiaries taken as a whole, in one
or more related transactions, to another Person, unless:

 

(1)           either: (a) the
Issuer is the surviving corporation; or (b) the Person formed by or surviving
any such consolidation or merger (if other than the Issuer) or to which such
sale, assignment, transfer, conveyance or other disposition has been

 

87

 

made is a
corporation organized or existing under the laws of the United States, any
state of the United States, the District of Columbia or any territory thereof
(the Issuer or such Person, as the case may be, being herein called the “Successor
Company”);

 

(2)           the Successor
Company (if other than the Issuer) or the Person to which such sale,
assignment, transfer, conveyance or other disposition has been made assumes all
the obligations of the Issuer under the Securities, this Indenture and the
Registration Rights Agreement;

 

(3)           immediately after
such transaction no Default or Event of Default exists;

 

(4)           immediately after giving
pro
forma effect to such transaction and any related financing
transactions, as if the same had occurred at the beginning of the applicable
four-quarter period, either

 

(a)           the Successor Company or the Person
to which such sale, assignment, transfer, conveyance or other disposition has
been made would be permitted to incur at least $1.00 of additional Indebtedness
pursuant to the Coverage Ratio Exception; or

 

(b)           the Fixed Charge Coverage Ratio for
the Successor Company and its Restricted Subsidiaries would be greater than
such ratio for the Issuer and its Restricted Subsidiaries immediately prior to
such transaction; and

 

(5)           each Guarantor,
unless it is the other party to the transactions described above, shall have by
supplemental indenture confirmed that its Guarantee shall apply to such Person’s
obligations under this Indenture and the Securities.

 

This Section
5.01 will not apply to a sale, assignment, transfer, conveyance or other
disposition of assets between or among the Issuer and its Restricted
Subsidiaries. Notwithstanding the foregoing clauses (3) and (4), (i) any
Restricted Subsidiary may consolidate with, merge into or transfer all or part
of its properties and assets to the Issuer or to another Restricted Subsidiary
and (ii) the Issuer may merge with an Affiliate incorporated solely for the
purpose of reincorporating the Issuer in another state of the United States so
long as the amount of Indebtedness of the Issuer and its Restricted
Subsidiaries is not increased thereby.

 

In the event
of any transaction described in and complying with the conditions listed in the
preceding paragraph in which the Issuer is not the continuing corporation, the
successor Person formed or remaining shall succeed to, and be substituted for,
and may exercise every right and power of, the Issuer and the Issuer will be
discharged from all obligations and covenants under this Indenture and the
Securities.

 

88

 

(b)           The Issuer will deliver to the
Trustee prior to the consummation of each proposed transaction an Officers’
Certificate certifying that the conditions set forth above are satisfied and an
Opinion of Counsel, which opinion may contain customary exceptions and
qualifications, that the proposed transaction and the supplemental indenture,
if any, comply with this Indenture.

 

ARTICLE SIX

 

DEFAULT AND REMEDIES

 

SECTION 6.01.                                         Events
of Default.

 

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

 

(1)           the Issuer defaults
in payment when due and payable, upon redemption, acceleration or otherwise, of
principal of, or premium, if any, on the Securities, whether or not prohibited
by Article Ten;

 

(2)           the Issuer defaults in the payment
when due of interest or Additional Interest, if any, on or with respect to the
Securities and such default continues for a period of 30 days, whether or not
prohibited by Article Ten;

 

(3)           the Issuer defaults in the
performance of, or breaches any covenant, warranty or other agreement contained
in, this Indenture (other than a default in the performance or breach of a
covenant, warranty or agreement which is specifically dealt with in clauses (1)
or (2) above) and such default or breach continues for a period of 60 days
after the notice specified below;

 

(4)           default under any mortgage, indenture
or instrument under which there is issued or by which there is secured or
evidenced any Indebtedness for money borrowed by the Issuer or any Restricted
Subsidiary or the payment of which is guaranteed by the Issuer or any
Restricted Subsidiary (other than Indebtedness owed to the Issuer or a
Restricted Subsidiary), whether such Indebtedness or guarantee now exists or is
created after the Issue Date, if (A) such default either (1) results from the
failure to pay any such Indebtedness at its stated final maturity (after giving
effect to any applicable grace periods) or (2) relates to an obligation other
than the obligation to pay principal of any such Indebtedness at its stated
final maturity and results in the holder or holders of such Indebtedness
causing such Indebtedness to become due prior to its stated maturity and (B)
the principal amount of such Indebtedness, together with the principal amount
of any other such Indebtedness in default for failure to pay principal at
stated final maturity (after giving effect to any applicable grace periods), or
the maturity 

 

89

 

of which has
been so accelerated, aggregate $25.0 million (or its foreign currency
equivalent) or more at any one time outstanding;

 

(5)           the Issuer or any
Significant Subsidiary pursuant to or within the meaning of any Bankruptcy Law:

 

(A)          commences a voluntary case,

 

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

 

(C)           consents to the appointment of a
Custodian of it or for all or substantially all of its property,

 

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

 

(E)           takes any comparable action under any
foreign laws relating to incolvency,

 

(F)           generally is not able to pay its
debts as they become due, or

 

(G)           takes any corporate action to
authorize or effect any of the foregoing;

 

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

 

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

 

(B)           appoints a Custodian of the Issuer or
any Significant Subsidiary or for all or substantially all of the property of
the Issuer or any Significant Subsidiary, or

 

(C)           orders the liquidation of the Issuer
or any Significant Subsidiary, and the order or decree remains unstayed and in
effect for 60 days;

 

(7)           the failure by the
Issuer or any Significant Subsidiary to pay final judgments (other than any
judgments covered by insurance policies issued by reputable and creditworthy
insurance companies) aggregating in excess of $25.0 million, which final
judgments remain unpaid, undischarged and unstayed for a period of more than 60
days after such judgment becomes final, and, with respect to any judgments

 

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covered by
insurance, an enforcement proceeding has been commenced by any creditor upon
such judgment or decree which is not promptly stayed; or

 

(8)           the Guarantee of a
Significant Subsidiary ceases to be in full force and effect (except as contemplated
by the terms thereof) or any Guarantor denies or disaffirms its obligations
under this Indenture or any Guarantee and such Default continues for 10 days.

 

SECTION 6.02.                                         Acceleration.

 

If an Event of
Default specified in Sections 6.01(5) and (6) above occurs with respect to the
Issuer and is continuing, then all unpaid principal of, and premium, if any,
and accrued and unpaid interest on all of the outstanding Securities shall ipso facto become
and be immediately due and payable without any declaration or other act on the
part of each Trustee or any Holder.

 

If any other
Event of Default shall occur and be continuing, the Trustee or the Holders of
at least 25% in principal amount of outstanding Securities under this Indenture
may declare the principal of and accrued interest on such Securities to be due
and payable by notice in writing to the Issuer and the Trustee specifying the
respective Event of Default and that it is a “notice of acceleration” (the “Acceleration Notice”), and the same:

 

(1)           shall become immediately due and
payable; or

 

(2)           shall become immediately due and
payable upon the first to occur of an acceleration under the Credit Agreement
and five Business Days after receipt by the Issuer and the Representative under
the Credit Agreement of such Acceleration Notice but only if such Event of
Default is then continuing.

 

At any time
after a declaration of acceleration with respect to the Securities as described
in the two preceding paragraphs, the Holders of a majority in principal amount
of the Securities may 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, which has become due otherwise than by such declaration of acceleration,
has been paid;

 

91

 

(4)           if the Issuer 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 Sections 6.01(5)
and (6), if the Trustee shall have received an Officers’ Certificate and an
Opinion of Counsel 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 6.03.                                         Other
Remedies.

 

(a)           If a Default occurs and is
continuing, the Trustee may pursue any available remedy by proceeding at law or
in equity to collect the payment of principal of or interest on the Securities
or to enforce the performance of any provision of the Securities or this
Indenture.

 

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

 

(c)           In the event of any Event of Default
specified in clause (4) of Section 6.01, such Event of Default and all
consequences thereof (excluding, however, any resulting payment default) will
be annulled, waived and rescinded, automatically and without any action by the
Trustee or the Holders, if within 20 days after such Event of Default arose the
Issuer delivers an Officers’ Certificate to the Trustee stating that (x) the
Indebtedness or guarantee that is the basis for such Event of Default has been
discharged or (y) 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 (z) the default that is the basis for such Event of Default has
been cured, it being understood that in no event shall an acceleration of the
principal amount of the Securities as described above be annulled, waived or
rescinded upon the happening of any such events.

 

(d)           Holders may not enforce this
Indenture or the Securities except as provided in this Indenture and under the
TIA. Subject to the provisions of this Indenture relating to the duties of the
Trustee, the Trustee is under no obligation to exercise any of its rights or
powers under this Indenture at the request, order or direction of any of the
Holders, unless such Holders have offered to the Trustee reasonable indemnity.
Subject to all provisions of this Indenture and applicable law, the Holders of
a majority in aggregate principal amount of the then outstanding Securities
issued under this Indenture have the right to direct the time,

 

92

 

method and place of conducting
any proceeding for any remedy available to the Trustee or exercising any trust
or power conferred on the Trustee.

 

SECTION 6.04.                                         Waiver
of Defaults.

 

Provided the
Securities are not then due and payable by reason of a declaration of
acceleration, the Holders of a majority in aggregate principal amount of
Securities at the time outstanding may on behalf of the Holders of all the
Securities waive any Default with respect to such Securities and its
consequences by providing written notice thereof to the Issuer and the Trustee,
except a Default (1) in the payment of interest on or the principal of any
Security or (2) in respect of a covenant or provision hereof which under this
Indenture cannot be modified or amended without the consent of the Holder of
each outstanding Security affected. In the case of any such waiver, the Issuers,
the Trustee and the Holders will be restored to their former positions and
rights under this Indenture, respectively; provided that no
such waiver shall extend to any subsequent or other Default or impair any right
consequent thereto. provided,
however, that if any amendment, waiver or other modification will
only affect the Dollar Securities or the Sterling Securities, only the consent
of the Holders of at least a majority in principal amount of the then
outstanding Dollar Securities or Sterling Securities (and not the consent of at
least a majority of all Securities), as the case may be, shall be required.

 

SECTION 6.05.                                         Control
by Majority.

 

The Holders of
not less than a majority in principal amount of the outstanding Securities may
direct the time, method and place of conducting any proceeding for any remedy
available to the Trustee or exercising any trust or power conferred on it.
Subject to Section 7.01, however, the Trustee may refuse to follow any
direction that conflicts with any law or this Indenture, that the Trustee
determines may be unduly prejudicial to the rights of another Securityholder,
or that may involve the Trustee in personal liability; provided that
the Trustee may take any other action deemed proper by the Trustee which is not
inconsistent with such direction.

 

In the event
the Trustee takes any action or follows any direction pursuant to this
Indenture, the Trustee shall be entitled to indemnification against any loss or
expense caused by taking such action or following such direction.

 

SECTION 6.06.                                         Limitation
on Suits.

 

A Holder may
not pursue any remedy with respect to this Indenture or the Securities unless:

 

(1)           the Holder gives to
the Trustee written notice of a continuing Event of Default;

 

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

 

(3)           such Holder or Holders offer and
provide to the Trustee indemnity reasonably satisfactory to the Trustee against
any loss, liability or expense;

 

(4)           the Trustee does not comply with the
request within 45 days after receipt of the request and the offer and the
provision of indemnity; and

 

(5)           during such 45-day period the Holder
or Holders of a majority in principal amount of the outstanding Securities do
not give the Trustee a direction which, in the opinion of the Trustee, is
inconsistent with the request.

 

A Holder may
not use this Indenture to prejudice the rights of another Holder or to obtain a
preference or priority over such other Holder.

 

SECTION 6.07.                                         Rights
of Holders To Receive Payment.

 

Notwithstanding
any other provision of this Indenture, the right of any Holder to receive
payment of principal of and interest on a Security, on or after the respective
due dates expressed in such Security, or to bring suit for the enforcement of
any such payment on or after such respective dates, shall not be impaired or
affected without the consent of the Holder.

 

SECTION 6.08.                                         Collection
Suit by Trustee.

 

If a Default
in payment of principal or interest specified in Section 6.01(1) or (2) occurs
and is continuing, the Trustee may recover judgment in its own name and as
trustee of an express trust against the Issuer or any other obligor on the
Securities for the whole amount of principal and accrued interest and fees
remaining unpaid, together with interest on overdue principal and, to the
extent that payment of such interest is lawful, interest on overdue
installments of interest, in each case at the rate per annum borne by the
Securities and such further amount as shall be sufficient to cover the costs
and expenses of collection, including the reasonable compensation, expenses,
disbursements and advances of the Trustee, its agents and counsel.

 

SECTION 6.09.                                         Trustee
May File Proofs of Claim.

 

The Trustee
may file such proofs of claim and other papers or documents as may be necessary
or advisable in order to have the claims of the Trustee (including any claim
for the compensation, expenses, disbursements and advances of the Trustee, its
agents and counsel) and the Holders allowed in any judicial proceedings
relating to the Issuer, its creditors or its property and shall be entitled and
empowered to collect and receive any monies or

 

94

 

other property payable or
deliverable on any such claims and to distribute the same, and any Custodian in
any such judicial proceedings 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 compensation, expenses, disbursements and advances of
the Trustee, its agent and counsel, and any other amounts due the Trustee under
Section 7.07. 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
Securities or the rights of any Holder thereof, or to authorize the Trustee to
vote in respect of the claim of any Holder in any such proceeding. The Trustee
shall be entitled to participate as a member of any officer committee of
creditors in the matters as it deems necessary or advisable.

 

SECTION 6.10.                                         Priorities.

 

Subject to the
provisions of Article Ten, if the Trustee collects any money or property
pursuant to this Article Six, it shall pay out the money or property in the
following order:

 

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

 

SECOND: to Holders for interest accrued on the Securities, ratably,
without preference or priority of any kind, according to the amounts due and
payable on the Securities for interest;

 

THIRD: to Holders for principal amounts due and unpaid on the
Securities, ratably, without preference or priority of any kind, according to
the amounts due and payable on the Securities for principal; and

 

FOURTH: to the Issuer or, if applicable, the Guarantors, as their respective
interests may appear.

 

The Trustee,
upon prior notice to the Issuer, may fix a record date and payment date for any
payment to Holders pursuant to this Section 6.10.

 

SECTION 6.11.                                         Undertaking
for Costs.

 

In any suit
for the enforcement of any right or remedy under this Indenture or in any suit
against the Trustee for any action taken or omitted by it as Trustee, a court
in its discretion may require the filing by any party litigant in the suit of
an undertaking to pay the costs of the suit, and the court in its discretion
may assess reasonable costs, including reasonable attorneys’ fees 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
6.11 does not apply to a suit by the Trustee, a suit by a Holder pursuant to
Section 6.07, or a

 

95

 

suit by a Holder or Holders of
more than 10% in principal amount of the outstanding Securities.

 

ARTICLE SEVEN

 

TRUSTEE

 

SECTION 7.01.                                         Duties
of Trustee.

 

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

 

(b)           Except during the
continuance of a Default:

 

(1)           The Trustee need perform only those
duties as are specifically set forth herein or in the TIA and no duties,
covenants, responsibilities or obligations shall be implied in this Indenture
against the Trustee.

 

(2)           In the absence of bad faith on its
part, the Trustee may conclusively rely, as to the truth of the statements and
the correctness of the opinions expressed therein, upon certificates (including
Officers’ Certificates) or opinions (including Opinions of Counsel) furnished
to the Trustee and conforming to the requirements of this Indenture. However,
in the case of any such certificates or opinions which by any provision hereof
are specifically required to be furnished to the Trustee, the Trustee shall
examine the certificates and opinions to determine whether or not they conform
to the requirements of this Indenture.

 

(c)           Notwithstanding anything to the
contrary herein, the Trustee may not be relieved from liability for its own
negligent action, its own negligent failure to act, or its own willful
misconduct, except that:

 

(1)           This paragraph does not limit the
effect of paragraph (b) of this Section 7.01.

 

(2)           The Trustee 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.

 

96

 

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

 

(d)           No provision of this Indenture shall
require the Trustee to expend or risk its own funds or otherwise incur any
financial liability in the performance of any of its duties hereunder or to
take or omit to take any action under this Indenture or take any action at the
request or direction of Holders if it shall have reasonable grounds for
believing that repayment of such funds is not assured to it.

 

(e)           Whether or not therein expressly so
provided, every provision of this Indenture that in any way relates to the
Trustee is subject to this Section 7.01.

 

(f)            The Trustee shall not be liable for
interest on any money received by it except as the Trustee may agree in writing
with the Issuer. Money held in trust by the Trustee need not be segregated from
other funds except to the extent required by law.

 

(g)           In the absence of bad faith, negligence
or willful misconduct on the part of the Trustee, the Trustee shall not be
responsible for the application of any money by any Paying Agent other than the
Trustee.

 

SECTION 7.02.                                         Rights
of Trustee.

 

Subject to Section 7.01:

 

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

 

(b)           Before the Trustee acts or refrains
from acting, it may require an Officers’ Certificate and an Opinion of Counsel,
which shall conform to the provisions of Section 12.05. The Trustee shall not
be liable for any action it takes or omits to take in good faith in reliance on
such certificate or opinion.

 

(c)           The Trustee may act through its
attorneys and agents and shall not be responsible for the misconduct or
negligence of any agent (other than an agent who is an employee of the Trustee)
appointed with due care.

 

(d)           The Trustee shall not be liable for
any action it takes or omits to take in good faith which it reasonably believes
to be authorized or within its rights or powers.

 

(e)           The Trustee may consult with counsel of its selection and the
advice or opinion of such counsel as to matters of law shall be full and complete
authorization

 

97

 

and protection
from liability in respect of any action taken, omitted or suffered by it
hereunder in good faith and in accordance with the advice or opinion of such
counsel.

 

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

 

(g)           The Trustee shall not be bound to
make any investigation into the facts or matters stated in any resolution,
certificate (including any Officers’ Certificate), statement, instrument,
opinion (including any Opinion of Counsel), notice, request, direction,
consent, order, bond, debenture, or other paper or document, but the Trustee,
in its discretion, may make such further inquiry or investigation into such
facts or matters as it may see fit and, if the Trustee shall determine to make
such further inquiry or investigation, it shall be entitled, upon reasonable
notice to the Issuer, to examine the books, records, and premises of the
Issuer, personally or by agent or attorney at the sole cost of the Issuer.

 

(h)           The Trustee shall not be required to
give any bond or surety in respect of the performance of its powers and duties
hereunder.

 

(i)            The permissive rights of the Trustee
to do things enumerated in this Indenture shall not be construed as duties.

 

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

 

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

 

SECTION 7.03.                                         Individual
Rights of Trustee.

 

The Trustee in
its individual or any other capacity may become the owner or pledgee of
Securities and may otherwise deal with the Issuer, its Subsidiaries or their
respective Affiliates with the same rights it would have if it were not
Trustee. Any Agent may do the same with like rights. However, the Trustee must
comply with Sections 7.10 and 7.11.

 

98

 

SECTION 7.04.                                         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 Securities, it shall not be accountable for
the Issuer’s use of the proceeds from the Securities, and it shall not be
responsible for any statement of the Issuer in this Indenture or any document
issued in connection with the sale of Securities or any statement in the
Securities other than the Trustee’s certificate of authentication. The Trustee
makes no representations with respect to the effectiveness or adequacy of this
Indenture.

 

SECTION 7.05.                                         Notice
of Default.

 

If a Default
occurs and is continuing and the Trustee receives actual notice of such
Default, the Trustee shall mail to each Holder notice of the uncured Default
within 60 days after such Default occurs. Except in the case of a Default in
payment of principal of, or interest on, any Security, including an accelerated
payment and the failure to make payment on the Change of Control Payment Date
pursuant to a Change of Control Offer or the Asset Sale Offer Payment Date
pursuant to an Asset Sale Offer, the Trustee may withhold the notice if and so
long as the Board of Directors, the executive committee, or a trust committee
of directors and/or Responsible Officers, of the Trustee in good faith
determines that withholding the notice is in the interest of the Holders.

 

SECTION 7.06.                                         Reports
by Trustee to Holders.

 

Within 60 days
after each May 1, beginning with May 1, 2005, the Trustee shall, to the extent
that any of the events described in TIA § 313(a) occurred within the previous
twelve months, but not otherwise, mail to each Holder a brief report dated as
of such date that complies with TIA § 313(a). The Trustee also shall comply
with TIA §§ 313(b), 313(c) and 313(d).

 

A copy of each
report at the time of its mailing to Holders shall be mailed to the Issuer and
filed with the Commission and each securities exchange, if any, on which the
Securities are listed.

 

The Issuer
shall notify the Trustee if the Securities become listed on any securities
exchange or of any delisting thereof and the Trustee shall comply with TIA §
313(d).

 

SECTION 7.07.                                         Compensation
and Indemnity.

 

The Issuer
shall pay to the Trustee from time to time such compensation as the Issuer and
the Trustee shall from time to time agree in writing for its services
hereunder. The Trustee’s compensation shall not be limited by any law on compensation of a trustee of an
express trust. The Issuer shall reimburse the Trustee upon request for all reasonable disbursements, 

 

99

 

expenses and advances
(including reasonable fees and expenses of counsel) incurred or made by it in
addition to the compensation for its services, except any such disbursements,
expenses and advances as may be attributable to the Trustee’s negligence, bad
faith or willful misconduct. Such expenses shall include the reasonable fees
and expenses of the Trustee’s agents and counsel.

 

The Issuer
shall indemnify each of the Trustee or any predecessor Trustee and its agents,
employees, officers, stockholders and directors for, and hold them harmless
against, any and all loss, damage, claims including taxes (other than taxes
based upon, measured by or determined by the income of the Trustee), liability
or expense incurred by them except for such actions to the extent caused by any
negligence, bad faith or willful misconduct on their part, arising out of or in
connection with the acceptance or administration of this trust including the
costs and expenses of enforcing this Indenture or a Guarantee against the
Issuer or a Guarantor (including this Section 7.07) and the reasonable costs
and expenses of defending themselves against or investigating any claim or
liability in connection with the exercise or performance of any of the Trustee’s
rights, powers or duties hereunder (whether asserted by the Issuer, any
Guarantor, any Holder or any other Person). The Trustee shall notify the Issuer
promptly of any claim asserted against the Trustee or any of its agents,
employees, officers, stockholders and directors for which it may seek
indemnity. The Issuer may, subject to the approval of the Trustee (which
approval shall not be unreasonably withheld), defend the claim and the Trustee
shall cooperate in the defense. The Trustee and its agents, employees, officers,
stockholders and directors subject to the claim may have separate counsel and
the Issuer shall pay the reasonable fees and expenses of such counsel; provided, however, that
the Issuer will not be required to pay such fees and expenses if, subject to
the approval of the Trustee (which approval shall not be unreasonably
withheld), it assumes the Trustee’s defense and there is no conflict of
interest between the Issuer and the Trustee and its agents, employees,
officers, stockholders and directors subject to the claim in connection with
such defense as reasonably determined by the Trustee. The Issuer need not pay
for any settlement made without its written consent. The Issuer need not
reimburse any expense or indemnify against any loss or liability to the extent
incurred by the Trustee through its negligence, bad faith or willful
misconduct.

 

To secure the
Issuer’s and the Guarantors’ payment obligations in this Section 7.07, the
Trustee shall have a Lien prior to the Securities against all money or property
held or collected by the Trustee, in its capacity as Trustee. The obligations
of the Issuer and the Guarantors under this Section shall not be subordinated
to the payment of Senior Debt pursuant to Article Ten or Section 11.02 except
assets or money held in trust to pay principal of or interest on particular
Securities.

 

When the
Trustee incurs expenses or renders services after a Default specified in
Section 6.01(5) or (6) occurs, such expenses and the compensation for such
services shall

 

100

 

be paid to the extent allowed
under any Bankruptcy Law and are intended to constitute expenses of
administration under any Bankruptcy Law.

 

Notwithstanding
any other provision in this Indenture, the foregoing provisions of this Section
7.07 shall survive the satisfaction and discharge of this Indenture or the
appointment of a successor Trustee.

 

SECTION 7.08.                                         Replacement
of Trustee.

 

The Trustee
may resign at any time by so notifying the Issuer in writing. The Holders of a
majority in principal amount of the outstanding Securities may remove the
Trustee by so notifying the Issuer and the Trustee and may appoint a successor
Trustee. The Issuer may remove the Trustee if:

 

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

 

(2)           the Trustee is adjudged a bankrupt or
an insolvent;

 

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

 

(4)           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 Issuer shall notify each Holder of such event and shall promptly
appoint a successor Trustee. Within one year after the successor Trustee takes
office, the Holders of a majority in principal amount of the Securities may
appoint a successor Trustee to replace the successor Trustee appointed by the
Issuer.

 

A successor
Trustee shall deliver a written acceptance of its appointment to the retiring
Trustee and to the Issuer. Immediately after that, the retiring Trustee shall
transfer, after payment of all sums then owing to the Trustee pursuant to
Section 7.07, all property held by it as Trustee to the successor Trustee,
subject to the Lien provided in Section 7.07, 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. A
successor Trustee shall mail notice of its succession to each Holder.

 

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

 

101

 

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

 

Notwithstanding
replacement of the Trustee pursuant to this Section 7.08, the Issuer’s
obligations under Section 7.07 shall continue for the benefit of the retiring
Trustee.

 

SECTION 7.09.                                         Successor
Trustee by Merger, Etc.

 

If the Trustee
consolidates with, merges or converts into, or transfers all or substantially
all of its corporate trust business to, another corporation, the resulting,
surviving or transferee corporation without any further act shall, if such
resulting, surviving or transferee corporation is otherwise eligible hereunder,
be the successor Trustee; provided that such corporation shall be
otherwise qualified and eligible under this Article Seven.

 

SECTION 7.10.                                         Eligibility;
Disqualification.

 

This Indenture
shall always have a Trustee who satisfies the requirement of TIA §§ 3l0(a)(1),
310(a)(2) and 310(a)(5). The Trustee shall have a combined capital and surplus
of at least $150,000,000 as set forth in its most recent published annual
report of condition. In addition, if the Trustee is a corporation included in a
bank holding company system, the Trustee, independently of the bank holding
company, shall meet the capital requirements of TIA § 310(a)(2). The Trustee
shall comply with TIA § 310(b); provided, however, that there shall be
excluded from the operation of TIA § 310(b)(1) any indenture or indentures
under which other securities, or certificates of interest or participation in
other securities, of the Issuer are outstanding, if the requirements for such
exclusion set forth in TIA § 310(b)(1) are met. The provisions of TIA § 310
shall apply to the Issuer and any other obligor of the Securities.

 

SECTION 7.11.                                         Preferential
Collection of Claims Against the Issuer.

 

The Trustee,
in its capacity as Trustee hereunder, shall comply with 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.

 

102

 

ARTICLE EIGHT

 

DISCHARGE OF INDENTURE; DEFEASANCE

 

SECTION 8.01.                                         Termination
of the Issuer’s Obligations.

 

The Issuer may
terminate its obligations under the Securities and this Indenture, except those
obligations referred to in the penultimate paragraph of this Section 8.01, if
all Securities previously authenticated and delivered (other than destroyed,
lost or stolen Securities which have been replaced or paid or Securities for
whose payment U.S. Legal Tender or U.K. Legal Tender, as applicable, or U.S.
Government Securities or U.K. Government Securities, as applicable, or a
combination thereof, in such amount as is, in the opinion of a nationally
recognized firm of independent public accountants, sufficient without
consideration of reinvestment of such interest, to pay principal of, premium,
if any, and interest on the outstanding Securities to maturity or redemption,
has theretofore been deposited with the Trustee or the Paying Agent in trust or
segregated and held in trust by the Issuer and thereafter repaid to the Issuer,
as provided in Section 8.05) have been delivered to the Trustee for
cancellation and the Issuer has paid all sums payable by it hereunder, or if:

 

(a)           either (i) pursuant
to Article Three, the Issuer shall have given notice to the Trustee and mailed
a notice of redemption to each Holder of the redemption of all of the
Securities in accordance with the provisions hereof or (ii) all Securities have
otherwise become or will become due and payable by reason of the mailing of a
notice of redemption or otherwise within one (1) year hereunder;

 

(b)           the Issuer shall
have irrevocably deposited or caused to be deposited with the Trustee or a
trustee satisfactory to the Trustee, under the terms of an irrevocable trust
agreement in form and substance satisfactory to the Trustee, as trust funds in
trust solely for the benefit of the Holders of that purpose, U.S. Legal Tender
or U.K. Legal Tender, as applicable, or U.S. Government Securities or U.K.
Government Securities, as applicable, or a combination thereof, in such amount
as is, in the opinion of a nationally recognized firm of independent public
accountants, sufficient without consideration of reinvestment of such interest,
to pay principal of, premium, if any, and interest on the outstanding
Securities to maturity or redemption; provided that
the Trustee shall have been irrevocably instructed to apply such U.S. Legal
Tender or U.K. Legal Tender, as applicable, or U.S. Government Securities or
U.K. Government Securities, as applicable, or a combination thereof; to the payment
of said principal, premium, if any, and interest with respect to the
Securities; and provided,
further, that from and after the time of deposit, the U.S. Legal
Tender or U.K. Legal Tender, as applicable, or U.S. Government Securities or
U.K. Securities, as applicable, or combination thereof; deposited shall not be
subject to the rights of holders of Senior Debt pursuant to the provisions of
Article Ten;

 

103

 

(c)           no Default with respect to this
Indenture or the Securities shall have occurred and be continuing on the date
of such deposit or shall occur as a result of such deposit (other than a
Default resulting from borrowing of funds to be applied to such deposit) and
such deposit will not result in a breach or violation of, or constitute a
default under, the Credit Agreement or any other material agreement or
instrument to which the Issuer or any of its Subsidiaries is a party or by
which it is bound;

 

(d)           the Issuer shall have paid all other
sums payable by it hereunder; and

 

(e)           the Issuer shall have delivered to
the Trustee an Officers’ Certificate and an Opinion of Counsel, each stating
that all conditions precedent providing for or relating to the termination of
the Issuer’s obligations under the Securities and this Indenture have been
complied with. Such Opinion of Counsel shall also state that such satisfaction
and discharge does not result in a default under the Credit Agreement or any
other material agreement or instrument then known to such counsel that binds or
affects the Issuer.

 

Subject to the
next sentence and notwithstanding the foregoing paragraph, the Issuer’s
obligations in Sections 2.06, 2.07, 2.08, 2.09, 4.01, 4.02, 7.07, 8.05 and 8.06
shall survive until the Securities are no longer outstanding pursuant to the
last paragraph of Section 2.08. After the Securities are no longer outstanding,
the Issuer’s obligations in Sections 7.07, 8.05 and 8.06 shall survive.

 

After such
delivery or irrevocable deposit, the Trustee upon request shall acknowledge in
writing the discharge of the Issuer’s obligations under the Securities and this
Indenture except for those surviving obligations specified above.

 

SECTION 8.02.                                         Legal
Defeasance and Covenant Defeasance.

 

(a)           The Issuer may, at its option and at
any time, elect to have either paragraph (b) or (c) below applied to all
outstanding Dollar Securities and/or Sterling Securities upon compliance with
the conditions set forth in Section 8.03.

 

(b)           Upon the Issuer’s exercise under
paragraph (a) hereof of the option applicable to this paragraph (b), the Issuer
and the Guarantors shall, subject to the satisfaction of the conditions set
forth in Section 8.03, be deemed to have been discharged from their obligations
with respect to all outstanding Dollar Securities and/or Sterling Securities on
the date the conditions set forth below are satisfied (hereinafter, “Legal Defeasance”). For this purpose, Legal Defeasance means that the Issuer shall
be deemed to have paid and discharged the entire Indebtedness represented by
the outstanding Dollar Securities and/or Sterling Securities, which shall
thereafter be deemed to be “outstanding” only for the purposes of Section 8.04
hereof and the other Sections of this Indenture (with respect to such
Securities) referred to in (i) and (ii) below, and to have satisfied all its
other obligations under such Dollar Securities

 

104

 

and/or Sterling Securities and
this Indenture (with respect to such Securities) and the Guarantors shall be
deemed to have satisfied all of their obligations under the Subsidiary
Guarantees and this Indenture (and the Trustee, on demand of and at the expense
of the Issuer, shall execute proper instruments acknowledging the same), except
for the following provisions which shall survive until otherwise terminated or
discharged hereunder:

 

(i)            the rights of
Holders of outstanding Securities issued hereunder to receive payments in
respect of the principal of, or interest or premium and Additional Interest, if
any, on such Securities when such payments are due from the trust referred to
below;

 

(ii)           the Issuer’s
obligations with respect to the Securities issued thereunder concerning issuing
temporary Securities, registration of Securities, mutilated, destroyed, lost or
stolen Securities and the maintenance of an office or agency for payment and
money for security payments held in trust;

 

(iii)          the rights, powers,
trusts, duties and immunities of the Trustee, and the Issuer’s obligations in
connection therewith; and

 

(iv)          this Article Eight.

 

Subject to
compliance with this Article Eight, the Issuer may exercise its option under
this Section 8.02(b) notwithstanding the prior exercise of its option under
Section 8.02(c) hereof.

 

(c)           Upon the Issuer’s exercise under paragraph
(a) hereof of the option applicable to this paragraph (c), the Issuer and the
Guarantors shall, subject to the satisfaction of the conditions set forth in
Section 8.03 hereof, be released from their obligations under the covenants
contained in Sections 4.03 (with respect to Restricted Subsidiaries only),
4.04, 4.05, 4.06, 4.07 and 4.09 through 4.20 and clauses (3) and (4) of Section
5.01(a) hereof with respect to the outstanding Dollar Securities and/or
Sterling Securities on and after the date the conditions set forth in Section
8.03 are satisfied (hereinafter, “Covenant
Defeasance”), and the
Dollar Securities and/or Sterling Securities 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 Securities shall not be deemed
outstanding for accounting purposes). For this purpose, Covenant Defeasance
means that, with respect to the outstanding Dollar Securities and/or Sterling
Securities, the Issuer may omit to comply with and shall have no liability in
respect of any term, condition or limitation set forth in any such covenant,
whether directly or indirectly, by reason of any reference elsewhere herein to
any other 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 an Event of Default under Section 6.01 hereof, but, except
as

 

105

 

specified above, the remainder
of this Indenture and such Securities shall be unaffected thereby. In addition,
upon the Issuer’s exercise under paragraph (a) hereof of the option applicable
to this paragraph (c), subject to the satisfaction of the conditions set forth
in Section 8.03 hereof, clauses (3), (4), (5), (6) and (7) of Section 6.01
hereof shall not constitute Events of Default.

 

SECTION 8.03.                                         Conditions
to Legal Defeasance or Covenant Defeasance.

 

The following
shall be the conditions to the application of either Section 8.02(b) or 8.02(c)
hereof to the outstanding Securities:

 

In order to
exercise either Legal Defeasance or Covenant Defeasance:

 

(1)           the Issuer must irrevocably deposit
with the Trustee, in trust, for the benefit of the holders of the applicable
Securities issued thereunder, cash in U.S. Legal Tender or U.K. Legal Tender,
as applicable, non-callable U.S. Government Securities or U.K. Government
Securities, as applicable, or a combination of cash in U.S. Legal Tender or
U.K. Legal Tender, as applicable, and non-callable U.S. Government Securities
or U.K. Government Securities, as applicable, in amounts as will be sufficient,
in the opinion of a nationally recognized firm of independent public
accountants, to pay the principal of, or interest and premium and Additional
Interest, if any, on the outstanding Securities issued thereunder on the stated
maturity or on the applicable redemption date, as the case may be, and the
Issuer must specify whether the Securities are being defeased to maturity or to
a particular redemption date;

 

(2)           in the case of an election under
Section 8.02(b) hereof, the Issuer has delivered to the Trustee an Opinion of
Counsel reasonably acceptable to the Trustee confirming that (a) the Issuer has
received from, or there has been published by, the Internal Revenue Service a
ruling or (b) since the date of this Indenture, there has been a change in the
applicable federal income tax law, in either case to the effect that, and based
thereon such Opinion of Counsel will confirm that, the holders of the
respective outstanding Securities will not recognize income, gain or loss for federal
income tax purposes as a result of such Legal Defeasance and will be subject to
federal income tax on the same amounts, in the same manner and at the same
times as would have been the case if such Legal Defeasance had not occurred;

 

(3)           in the case of an election under
Section 8.02(c) hereof, the Issuer has delivered to the Trustee an Opinion of
Counsel reasonably acceptable to the Trustee confirming that the holders of the
respective outstanding Securities 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;

 

106

 

(4)           no Default or Event of Default has
occurred and is continuing on the date of such deposit (other than a Default or
Event of Default resulting from the borrowing of funds to be applied to such
deposit) or insofar as Events of Default resulting from the borrowing of funds
or insolvency events are concerned, at any time in the period ending on the
91st day after the date of deposit;

 

(5)           such Legal Defeasance or Covenant
Defeasance will not result in a breach or violation of, or constitute a default
under any material agreement or instrument (other than this Indenture) to which
the Issuer or any of its Restricted Subsidiaries is a party or by which the
Issuer or any of its Restricted Subsidiaries is bound;

 

(6)           the Issuer must deliver to the
Trustee an Officers’ Certificate stating that the deposit was not made by the
Issuer with the intent of preferring the Holders over the other creditors of
the Issuer with the intent of defeating, hindering, delaying or defrauding
creditors of the Issuer or others; and

 

(7)           the Issuer must deliver to the
Trustee an Officers’ Certificate and an Opinion of Counsel, each stating that
all conditions precedent relating to the Legal Defeasance or the Covenant
Defeasance have been complied with.

 

SECTION 8.04.                                         Application
of Trust Money.

 

The Trustee or
Paying Agent shall hold in trust U.S. Legal Tender or U.K. Legal Tender, as
applicable, and U.S. Government Securities or U.K. Government Securities, as
applicable, deposited with it pursuant to this Article Eight, and shall apply
the deposited U.S. Legal Tender or U.K. Legal Tender, as applicable and the
money from U.S. Government Securities or U.K. Government Securities, as
applicable, in accordance with this Indenture to the payment of principal of
and interest on the Securities. The Trustee shall be under no obligation to
invest said U.S. Legal Tender or U.K. Legal Tender, as applicable, and U.S.
Government Securities or U.K. Government Securities, as applicable, except as
it may agree with the Issuer.

 

The Issuer
shall pay and indemnify the Trustee against any tax, fee or other charge
imposed on or assessed against the U.S. Legal Tender or U.K. Legal Tender as
applicable, and U.S. Government Securities or U.K. Government Securities, as applicable,
deposited pursuant to Section 8.03 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 Securities.

 

Anything in
this Article Eight to the contrary notwithstanding, the Trustee shall deliver
or pay to the Issuer from time to time upon the Issuer’s request any U.S. Legal
Tender or U.K. Legal Tender, as applicable, and U.S. Government Securities or
U.K. Government Securities, as applicable, held by it as provided in Section
8.03 which, in the opinion

 

107

 

of a nationally recognized firm
of independent public accountants expressed in a written certification thereof
delivered to the Trustee, are in excess of the amount thereof that would then
be required to be deposited to effect an equivalent Legal Defeasance or
Covenant Defeasance.

 

SECTION 8.05.                                         Repayment
to the Issuer.

 

Subject to
this Article Eight, the Trustee and the Paying Agent shall promptly pay to the
Issuer upon request any excess U.S. Legal Tender or U.K. Legal Tender, as
applicable, and U.S. Government Securities or U.K. Government Securities, as
applicable, held by them at any time and thereupon shall be relieved from all
liability with respect to such money. The Trustee and the Paying Agent shall
pay to the Issuer upon request any money held by them for the payment of
principal or interest that remains unclaimed for two years; provided that
the Trustee or such Paying Agent, before being required to make any payment,
may at the expense of the Issuer cause to be published once in a newspaper of
general circulation in the City of New York or mail to each Holder entitled to
such money notice that such money remains unclaimed and that after a date
specified therein which shall be at least 30 days from the date of such
publication or mailing any unclaimed balance of such money then remaining will
be repaid to the Issuer. After payment to the Issuer, Holders entitled to such
money must look to the Issuer for payment as general creditors unless an
applicable law designates another Person.

 

SECTION 8.06.                                         Reinstatement.

 

If the Trustee
or Paying Agent is unable to apply any U.S. Legal Tender or U.K. Legal Tender,
as applicable, and U.S. Government Securities or U.K. Government Securities, as applicable, in accordance with this
Article Eight by reason of any legal proceeding or by reason of any order or
judgment of any court or governmental authority enjoining, restraining or
otherwise prohibiting such application, the Issuer’s obligations under this
Indenture and the Securities shall be revived and reinstated as though no
deposit had occurred pursuant to this Article Eight until such time as the
Trustee or Paying Agent is permitted to apply all such U.S. Legal Tender or
U.K. Legal Tender, as applicable, and U.S. Government Securities or U.K.
Government Securities, as applicable, in accordance with this Article Eight; provided that if
the Issuer has made any payment of interest on or principal of any Securities
because of the reinstatement of its obligations, the Issuer shall be subrogated
to the rights of the Holders of such Securities to receive such payment from
the U.S. Legal Tender or U.K. Legal Tender, as applicable, or U.S. Government Securities
or U.K. Government Securities, as applicable, held by the Trustee or Paying
Agent.

 

108

 

ARTICLE NINE

 

AMENDMENTS, SUPPLEMENTS AND WAIVERS

 

SECTION 9.01.                                         Without
Consent of Holders.

 

Subject to
Section 9.03, the Issuer and the Trustee, together, may amend or supplement
this Indenture, the Securities or the Guarantees without notice to or consent
of any Holder:

 

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

 

(2)           to provide for uncertificated Securities
in addition to or in place of certificated Securities;

 

(3)           to provide for the assumption of the
Issuer’s obligations to Holders in the case of a merger or consolidation or
sale of all or substantially all of the Issuer’s assets;

 

(4)           to make any change that would provide
any additional rights or benefits to the Holders or that does not adversely
affect the legal rights under this Indenture of any Holder;

 

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

 

(6)           to add a Guarantee of the Securities,
including, without limitation, by Holdco;

 

provided that the Issuer has delivered to the
Trustee an Opinion of Counsel and an Officers’ Certificate, each stating that
such amendment or supplement complies with the provisions of this Section 9.01.

 

SECTION 9.02.                                         With
Consent of Holders.

 

(a)           Subject to Sections 6.07 and 9.03,
the Issuer and the Trustee, together, with the written consent of the Holder or
Holders of a majority in aggregate principal amount of the outstanding
Securities, may amend or supplement this Indenture or the Securities without
notice to any other Holders. Subject to Sections 6.07 and 9.03, the Holder or
Holders of a majority in aggregate principal amount of then outstanding
Securities may waive compliance with any provision of this Indenture or the
Securities without notice to any other Holders; provided, however, that if any amendment, waiver or other
modification will only affect the Dollar Securities or the Sterling Securities,
only the consent of the Holders of at least a majority

 

109

 

in principal amount of the then
outstanding Dollar Securities or Sterling Securities (and not the consent of at
least a majority of all Securities), as the case may be, shall be required.

 

(b)           Notwithstanding Section 9.02(a),
without the consent of each Holder affected, an amendment, supplement or
waiver, including a waiver pursuant to Section 6.04, may not (with respect to any
Securities held by a non-consenting Holder):

 

(1)           reduce the principal amount of
Securities whose Holders must consent to an amendment, supplement or waiver;

 

(2)           reduce the principal of or change the
fixed maturity of any Security or alter the provisions with respect to the
redemption of the Securities (other than provisions of Sections 4.09 and 4.13
and the optional redemption provisions contained in the Securities);

 

(3)           reduce the rate of or change the time
for payment of interest on any Security;

 

(4)           waive a Default or Event of Default
in the payment of principal, or interest or premium, or Additional Interest, if
any, on the Securities (except a rescission of acceleration of the Securities
by the Holders of at least a majority in aggregate principal amount of the
Securities and a waiver of the payment default that resulted from such
acceleration);

 

(5)           make any Security payable in money
other than that stated in the Securities other than to the extent the United
Kingdom adopts the euro;

 

(6)           make any change in the provisions of
this Indenture relating to waivers of past Defaults or the rights of Holders to
receive payments of principal of, or interest or premium or Additional
Interest, if any, on the Securities;

 

(7)           waive a redemption payment with
respect to any Security (other than a payment required by one of the provisions
of Section 4.09 or Section 4.13 and the optional redemption provisions
contained in the Securities);

 

(8)           make any change in the preceding
amendment and waiver provisions; or

 

(9)           modify the Guarantees in any manner
adverse to the Holders.

 

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

 

110

 

(d)           After
an amendment, supplement or waiver under this Section 9.02 becomes effective,
the Issuer shall mail to the Holders affected thereby a notice briefly
describing the amendment, supplement or waiver. Any failure of the Issuer to
mail such notice, or any defect therein, shall not, however, in any way impair
or affect the validity of any such amendment, supplement or waiver.

 

SECTION 9.03.                                         Effect
on Senior Debt.

 

No amendment
of, or supplement or waiver to, this Indenture shall adversely affect the
rights of any holder of Senior Debt under the subordination provisions of this
Indenture (including without limitation the provisions of Article Ten and
Section 11.02 hereof) and the defined terms as used therein without the consent
of such holder or its Representative.

 

SECTION 9.04.                                         Compliance
with TIA.

 

From the date
on which this Indenture is qualified under the TIA, every amendment, waiver or
supplement of this Indenture, the Securities or the Subsidiary Guarantees shall
comply with the TIA as then in effect.

 

SECTION 9.05.                                         Revocation
and Effect of Consents.

 

(a)             Until an amendment, waiver or
supplement becomes effective, a consent to it by a Holder is a continuing
consent by the Holder and every subsequent Holder of a Security or portion of a
Security that evidences the same debt as the consenting Holder’s Security, even
if notation of the consent is not made on any Security. However, any such
Holder or subsequent Holder may revoke the consent as to his Security or
portion of his Security by notice to the Trustee or the Issuer received before
the date on which the Trustee receives an Officers’ Certificate certifying that
the Holders of the requisite principal amount of Securities have consented (and
not theretofore revoked such consent) to the amendment, supplement or waiver.

 

(b)             The Issuer may, but shall not be
obligated to, fix a record date for the purpose of determining the Holders
entitled to consent to any amendment, supplement or waiver which record date
shall be at least 30 days prior to the first solicitation of such consent. If a
record date is fixed, then notwithstanding the last sentence of the immediately
preceding paragraph, those Persons who were Securityholders at such record date
(or their duly designated proxies), and only those Persons, shall be entitled
to revoke any consent previously given, whether or not such Persons continue to
be Holders after such record date. No such consent shall be valid or effective
for more than 90 days after such record date. The Issuer shall inform the
Trustee in writing of the fixed record date if applicable.

 

(c)             After an amendment, supplement or
waiver becomes effective, it shall bind every Securityholder, unless it makes a
change described in any of clauses (1) through

 

111

 

(8) of Section 9.02(b), in
which case, the amendment, supplement or waiver shall bind only each Holder of
a Security who has consented to it and every subsequent Holder of a Security or
portion of a Security that evidences the same debt as the consenting Holder’s
Security; provided that any such
waiver shall not impair or affect the right of any Holder to receive payment of
principal of and interest on a Security, on or after the respective due dates
expressed in such Security, or to bring suit for the enforcement of any such
payment on or after such respective dates without the consent of such Holder.

 

SECTION 9.06.                                         Notation
on or Exchange of Securities.

 

If an
amendment, supplement or waiver changes the terms of a Security, the Issuer may
require the Holder of the Security to deliver it to the Trustee. The Issuer
shall provide the Trustee with an appropriate notation on the Security about
the changed terms and cause the Trustee to return it to the Holder at the
Issuer’s expense. Alternatively, if the Issuer or the Trustee so determines,
the Issuer in exchange for the Security shall issue and the Trustee shall
authenticate a new Security that reflects the changed terms. Failure to make
the appropriate notation or issue a new Security shall not affect the validity
and effect of such amendment, supplement or waiver.

 

SECTION 9.07.                                         Trustee
To Sign Amendments, Etc.

 

The Trustee
shall execute any amendment, supplement or waiver authorized pursuant to this
Article Nine; provided that the
Trustee may, but shall not be obligated to, execute any such amendment,
supplement or waiver which affects the Trustee’s own rights, duties or
immunities under this Indenture. The Trustee shall be entitled to receive, and
shall be fully protected in relying upon, an Opinion of Counsel and an Officers’
Certificate each stating that the execution of any amendment, supplement or
waiver authorized pursuant to this Article Nine is authorized or permitted by
this Indenture and constitutes the legal, valid and binding obligations of the
Issuer enforceable in accordance with its terms. Such Opinion of Counsel shall
be at the expense of the Issuer.

 

ARTICLE TEN

 

SUBORDINATION OF SECURITIES

 

SECTION 10.01.                                   Securities
Subordinated to Senior Debt.

 

Anything
herein to the contrary notwithstanding, the Issuer, for itself and its
successors, and each Holder, by his or her acceptance of Securities, agrees
that the payment of all Obligations owing to the Holders in respect of the
Securities is subordinated, to the extent and in the manner provided in this
Article Ten, to the prior payment in full in cash or Cash

 

112

 

Equivalents, or such payment
duly provided for to the satisfaction of the holders of Senior Debt, of all
Obligations on Senior Debt (including the Obligations with respect to the
Senior Credit Facility, whether outstanding on the Issue Date or thereafter
incurred). Notwithstanding the foregoing, payments and distributions made
relating to the Securities from the trust established pursuant to Article Eight
shall not be so subordinated in right of payment, so long as (i) the conditions
specified in Article Eight (without any waiver or modification of the
requirement that the deposits pursuant thereto do not conflict with the teens
of the Credit Agreement or any other Senior Debt) are satisfied on the date of
any deposit pursuant to said trust and (ii) such payments and distributions did
not violate the provisions of this Article Ten or Section 11.02 when made.

 

This Article
Ten shall constitute a continuing offer to all Persons who become holders of,
or continue to hold, Senior Debt, and such provisions are made for the benefit
of the holders of Senior Debt and such holders are made obligees hereunder and
any one or more of them may enforce such provisions.

 

SECTION 10.02.                                   Suspension
of Payment When Designated Senior Debt Is in Default.

 

(a)           If
any default occurs and is continuing beyond any applicable grace period and is
continuing when payment is due, whether at maturity, upon any redemption, by
declaration or otherwise, of any principal of, interest on, unpaid drawings for
letters of credit issued in respect of, or regularly accruing fees with respect
to, any Designated Senior Debt (a “Payment
Default”), then no
payment or distribution of any kind or character shall be made by or on behalf
of the Issuer or any other Person on its or their behalf with respect to any
Obligations on or relating to the Securities or to acquire any of the
Securities for cash or assets or otherwise unless the default has been cured or
waived; provided, however, that the Issuer may pay the Securities without
regard to the foregoing if the Issuer and the Trustee receive written notice
approving such payment from the representative of the holders of such
Designated Senior Debt.

 

(b)           If
any other event of default (other than a Payment Default) occurs and is
continuing with respect to any Designated Senior Debt (as such event of default
is defined in the instrument creating or evidencing such Designated Senior
Debt) permitting the holders of such Designated Senior Debt then outstanding to
accelerate the maturity thereof (a “Non-payment
Default”) and if the
Representative for the respective issue of Designated Senior Debt gives notice
of the event of default to the Trustee stating that such notice is a payment
blockage notice (a “Payment Blockage Notice”), then during the period (the “Payment Blockage Period”) beginning upon the delivery of such
Payment Blockage Notice and ending on the earlier of the 179th day after such
delivery and the date on which (x) all events of default with respect to all
Designated Senior Debt have been cured or waived or cease to exist, (y) all
Designated Senior Debt with respect to which any such event of default has
occurred and is continuing is discharged or paid in full in cash or cash equivalents, or (z) the Trustee

 

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receives notice thereof from
the Representative for the respective issue of Designated Senior Debt
terminating the Payment Blockage Period, neither the Issuer nor any other
Person on its behalf shall (x) make any payment of any kind or character with
respect to any Obligations on or with respect to the Securities or (y) acquire
any of the Securities for cash or assets or otherwise. Notwithstanding anything
herein to the contrary, (x) in no event will a Payment Blockage Period extend
beyond 179 days from the date the applicable Payment Blockage Notice is
received by the Trustee and (y) only one such Payment Blockage Period may be
commenced within any 360 consecutive days. For
all purposes of this Section 10.02(b), no event of default which existed or was
continuing on the date of the commencement of any Payment Blockage Period with
respect to the Designated Senior Debt shall be, or be made, the basis for the
commencement of a second Payment Blockage Period by the Representative of such
Designated Senior Debt whether or not within a period of 360 consecutive days,
unless such event of default shall have been cured or waived for a period of
not less than 90 consecutive days (it being acknowledged that any subsequent
action, or any breach of any financial covenants for a period ending after the
date of commencement of such Payment Blockage Period that, in either case,
would give rise to an event of default pursuant to any provisions under which
an event of default previously existed or was continuing shall constitute a new
event of default for this purpose).

 

(c)           The
foregoing Sections 10.02(a) and (b) shall not apply to payments and distributions
made relating to the Securities from the trust established pursuant to Article
Eight, so long as (i) the conditions specified in Article Eight (without any
waiver or modification of the requirement that the deposits pursuant thereto do
not conflict with the terms of the Credit Agreement or any other Senior Debt) are satisfied on the date of any deposit
pursuant to said trust and (ii) such payments and distributions did not violate
the provisions of this Article Ten when made. In addition, Holders may also
receive and retain Permitted Junior Securities.

 

(d)           In
the event that, notwithstanding the foregoing, any payment shall be received by
the Trustee or any Holder when such payment is prohibited by the foregoing
provisions of this Section 10.02, such payment shall be held in trust for the
benefit of, and shall be paid over or delivered to, the holders of Senior Debt (pro rata to such holders on the basis of
the respective amount of Senior Debt held by such holders) or their respective
Representatives, as their respective interests may appear. The Trustee shall be
entitled to rely on information regarding amounts then due and owing on the
Senior Debt, if any, received from the holders of Senior Debt (or their
Representatives) or, if such information is not received from such holders or
their Representatives, from the Issuer and only amounts included in the
information provided to the Trustee shall be paid to the holders of Senior
Debt.

 

Nothing contained in this Article Ten shall
limit the right of the Trustee or the Holders of Securities to take any action
to accelerate the maturity of the Securities pursuant to Section 6.02 or to
pursue any rights or remedies hereunder; provided
that all Senior Debt

 

114

 

thereafter due or declared to
be due shall first be paid in full in cash or cash equivalents before the
Holders are entitled to receive any payment of any kind or character with
respect to Obligations on the Securities.

 

SECTION 10.03.       Securities
Subordinated to Prior Payment of All Senior Debt on Dissolution, Liquidation or

Reorganization of the Issuer.

 

(a)           Upon
any payment or distribution of assets of the Issuer of any kind or character,
whether in cash, assets or securities, to creditors upon any total or partial
liquidation, dissolution, winding-up, reorganization, assignment for the
benefit of creditors or marshaling of assets and liabilities of the Issuer or
in a bankruptcy, reorganization, insolvency, receivership or other similar
proceeding relating to the Issuer or its assets, whether voluntary or
involuntary, all Obligations due or to become due upon all Senior Debt shall
first be paid in full in cash or cash equivalents, or such payment duly
provided for to the satisfaction of the holders of Senior Debt, before any
payment or distribution of any kind or character is made on account of any
Obligations on or relating to the Securities, or for the acquisition of any of
the Securities for cash or assets or otherwise. Upon any such dissolution,
winding-up, liquidation, reorganization, receivership or similar proceeding,
any payment or distribution of assets of the Issuer of any kind or character, whether
in cash, assets or securities, to which the Holders or the Trustee under this
Indenture would be entitled, except for the provisions hereof, shall be paid by
the Issuer or by any receiver, trustee in bankruptcy, liquidating trustee,
agent or other Person making such payment or distribution, or by the Holders or
by the Trustee under this Indenture if received by them, directly to the
holders of Senior Debt (pro rata to such holders on the basis of
the respective amounts of Senior Debt held by such holders) or their respective
Representatives, or to the trustee or trustees under any indenture pursuant to
which any of such Senior Debt may have been issued, as their respective
interests may appear, for application to the payment of Senior Debt remaining unpaid
until all such Senior Debt has been paid in full in cash or cash equivalents
after giving effect to any concurrent payment, distribution or provision
therefor to or for the holders of Senior Debt.

 

(b)           To
the extent any payment of Senior Debt (whether by or on behalf of the Issuer,
as proceeds of security or enforcement of any right of setoff or otherwise) is
declared to be fraudulent or preferential, set aside or required to be
paid to any receiver, trustee in bankruptcy, liquidating trustee, agent or
other similar Person under any bankruptcy, insolvency, receivership, fraudulent
conveyance or similar law, then, if such payment is recovered by, or paid over
to, such receiver, trustee in bankruptcy, liquidating trustee, agent or other
similar Person, the Senior Debt or part thereof originally intended to be
satisfied shall be deemed to be reinstated
and outstanding as if such payment had not occurred.

 

It is further
agreed that any diminution (whether pursuant to court decree or otherwise,
including without limitation for any of the reasons described in the preceding
sentence) of the Issuer’s obligation to make any distribution or payment
pursuant to any Senior

 

115

 

Debt, except to the extent such
diminution occurs by reason of the repayment (which has not been disgorged or
returned) of such Senior Debt in cash or cash equivalents, shall have no force
or effect for purposes of the subordination provisions contained in this
Article Ten, with any turnover of payments as otherwise calculated pursuant to
this Article Ten to be made as if no such diminution had occurred.

 

(c)           In
the event that, notwithstanding the foregoing, any payment or distribution of
assets of the Issuer of any kind or character, whether in cash, assets or
securities, shall be received by any Holder when such payment or distribution
is prohibited by this Section 10.03, such payment or distribution shall be held
in trust for the benefit of, and shall be paid over or delivered to, the
holders of Senior Debt (pro rata to such holders on the basis of
the respective amount of Senior Debt held by such holders) or their respective
Representatives, or to the trustee or trustees under any indenture pursuant to
which any of such Senior Debt may have been issued, as their respective
interests may appear, for application to the payment of Senior Debt remaining
unpaid until all such Senior Debt has been paid in full in cash or Cash
Equivalents, after giving effect to any concurrent payment, distribution or provision
therefor to or for the holders of such Senior Debt.

 

(d)           The
consolidation of the Issuer with, or the merger of the Issuer with or into,
another corporation, partnership, trust or limited liability company or the
liquidation or dissolution of the Issuer following the conveyance or transfer
of all or substantially all of its assets, to another corporation, partnership,
trust or limited liability company upon the terms and conditions provided in
Article Five hereof and as long as permitted under the terms of the Senior Debt
shall not be deemed a dissolution, winding-up, liquidation or reorganization
for the purposes of this Section if such other corporation shall, as a part of
such consolidation, merger, conveyance or transfer, assume the Issuer’s obligations
hereunder in accordance with Article Five hereof.

 

SECTION 10.04.                                   Payments
May Be Made Prior to Dissolution.

 

Nothing
contained in this Article Ten or elsewhere in this Indenture shall prevent (i)
the Issuer, except under the conditions described in Sections 10.02 and 10.03,
from making payments at any time for the purpose of making payments of
principal of and interest on the Securities, or from depositing with the
Trustee any moneys for such payments, or (ii) in the absence of actual
knowledge by the Trustee that a given payment would be prohibited by Section
10.02 or 10.03, the application by the Trustee of any moneys deposited with it
for the purpose of making such payments of principal of, and interest on, the
Securities to the Holders entitled thereto unless at least two Business Days
prior to the date upon which such payment would otherwise become due and
payable a Responsible Officer of the Trustee shall have actually received the
written notice provided for in the first sentence of Section 10.02(b) or in
Section 10.07 (provided that, notwithstanding the foregoing,
the Holders receiving any payments made in contravention of Section 10.02
and/or 10.03 (and the respective such payments) 

 

116

 

shall otherwise be subject to
the provisions of Section 10.02 and Section 10.03). The Issuer shall give
prompt written notice to the Trustee of any dissolution, winding-up,
liquidation or reorganization of the Issuer, although any delay or failure to
give any such notice shall have no effect on the subordination provisions
contained herein.

 

SECTION 10.05.                                   Holders
To Be Subrogated to Rights of Holders of Senior Debt.

 

Subject to the
payment in full in cash or cash equivalents of all Senior Debt, the Holders of
the Securities shall be subrogated to the rights of the holders of Senior Debt
to receive payments or distributions of cash, assets or securities of the
Issuer applicable to the Senior Debt until the Securities shall be paid in
full; and, for the purposes of such subrogation, no such payments or
distributions to the holders of the Senior Debt by or on behalf of the Issuer,
or by or on behalf of the Holders by virtue of this Article Ten, which
otherwise would have been made to the Holders shall, as between the Issuer and
the Holders, be deemed to be a payment by the Issuer to or on account of the
Senior Debt, it being understood that the provisions of this Article Ten are
and are intended solely for the purpose of defining the relative rights of the
Holders, on the one hand, and the holders of Senior Debt, on the other hand.

 

SECTION 10.06.                                   Obligations
of the Issuer Unconditional.

 

Nothing
contained in this Article Ten or elsewhere in this Indenture or in the
Securities is intended to or shall impair, as among the Issuer, its creditors
other than the holders of Senior Debt, and the Holders, the obligation of the
Issuer, which is absolute and unconditional, to pay to the Holders the
principal of and any interest on the Securities as and when the same shall become
due and payable in accordance with their terms, or is intended to or shall
affect the relative rights of the Holders and creditors of the Issuer other
than the holders of the Senior Debt, nor shall anything herein or therein
prevent the Holder of any Security or the Trustee on its behalf from exercising
all remedies otherwise permitted by applicable law upon default under this
Indenture, subject to the rights, if any, in respect of cash, assets or
securities of the Issuer received upon the exercise of any such remedy.

 

SECTION 10.07.                                   Notice
to Trustee.

 

The Issuer
shall give prompt written notice to the Trustee of any fact known to the Issuer
which would prohibit the making of any payment to or by the Trustee in respect
of the Securities pursuant to the provisions of this Article Ten, although any
delay or failure to give any such notice shall have no effect on the
subordination provisions contained herein. Regardless of anything to the
contrary contained in this Article Ten or elsewhere in this Indenture, the
Trustee shall not be charged with knowledge of the existence of any default or
event of default with respect to any Senior Debt or of any other facts which
would prohibit the making of any payment to or by the Trustee unless and until
the Trustee shall have received notice in writing from the Issuer, or from a
holder of Senior Debt or a Representative therefor and, prior to the receipt of
any such written notice, the Trustee shall be entitled to assume (in

 

117

 

the absence of actual knowledge
to the contrary) that no such facts exist. The Trustee shall be entitled to
rely on the delivery to it of any notice pursuant to this Section 10.07 to
establish that such notice has been given by a holder of Senior Debt (or a
trustee thereof).

 

In the event
that the Trustee determines in good faith that any evidence is required with
respect to the right of any Person as a holder of Senior Debt to participate in
any payment or distribution pursuant to this Article Ten, the Trustee may
request such Person to furnish evidence to the satisfaction of the Trustee as
to the amounts of Senior Debt held by such Person, the extent to which such
Person is entitled to participate in such payment or distribution and any other
facts pertinent to the rights of such Person under this Article Ten, and if
such evidence is not furnished the Trustee may defer any payment to such Person
pending judicial determination as to the right of such Person to receive such
payment.

 

SECTION 10.08.                                   Reliance
on Judicial Order or Certificate of Liquidating Agent.

 

Upon any
payment or distribution of assets of the Issuer referred to in this Article
Ten, the Trustee, subject to the provisions of Article Seven hereof, and the
Holders of the Securities shall be entitled to rely upon any order or decree
made by any court of competent jurisdiction in which any insolvency,
bankruptcy, receivership, dissolution, winding-up, liquidation, reorganization
or similar case or proceeding is pending, or upon a certificate of the
receiver, trustee in bankruptcy, liquidating trustee, assignee for the benefit
of creditors, agent or other person making such payment or distribution,
delivered to the Trustee or the Holders, for the purpose of ascertaining the
persons entitled to participate in such payment or distribution, the holders of
the Senior Debt and other Indebtedness of the Issuer, the amount thereof or
payable thereon, the amount or amounts paid or distributed thereon and all
other facts pertinent thereto or to this Article Ten.

 

SECTION 10.09.                                   Trustee’s
Relation to Senior Debt.

 

The Trustee
and any agent of the Issuer or the Trustee shall be entitled to all the rights
set forth in this Article Ten with respect to any Senior Debt which may at any
time be held by it in its individual or any other capacity to the same extent
as any other holder of Senior Debt and nothing in this Indenture shall deprive
the Trustee or any such agent of any of its rights as such holder.

 

With respect
to the holders of Senior Debt, the Trustee undertakes to perform or to observe
only such of its covenants and obligations as are specifically set forth in
this Article Ten, and no implied covenants or obligations with
respect to the holders of Senior Debt shall be read into this Indenture against
the Trustee. The Trustee shall not be deemed to owe any fiduciary duty to the
holders of Senior Debt.

 

118

 

Whenever a
distribution is to be made or a notice given to holders or owners of Senior
Debt, the distribution may be made and the notice may be given to their
Representative, if any.

 

SECTION 10.10.                                   Subordination
Rights Not Impaired by Acts or Omissions of the Issuer or Holders of Senior
Debt.

 

No right of
any present or future holders of any Senior Debt to enforce subordination as
provided herein shall at any time in any way be prejudiced or impaired by any
act or failure to act on the part of the Issuer or by any act or failure to
act, in good faith, by any such holder, or by any noncompliance by the Issuer
with the terms of this Indenture, regardless of any knowledge thereof which any
such holder may have or otherwise be charged with.

 

Without in any
way limiting the generality of the foregoing paragraph, the holders of Senior
Debt may, at any time and from time to time, without the consent of or notice
to the Trustee, without incurring responsibility to the Trustee or the Holders
and without impairing or releasing the subordination provided in this Article
Ten or the obligations hereunder of the Holders to the holders of the Senior
Debt, do any one or more of the following: (i) change the manner, place or
terms of payment or extend the time of payment of, or renew or alter, Senior
Debt, or otherwise amend or supplement in any manner Senior Debt, or any
instrument evidencing the same or any agreement under which Senior Debt is
outstanding; (ii) sell, exchange, release or otherwise deal with any property
pledged, mortgaged or otherwise securing Senior Debt; (iii) release any Person
liable in any manner for the payment or collection of Senior Debt; and (iv)
exercise or refrain from exercising any rights against the Issuer and any other
Person.

 

SECTION 10.11.                                   Securityholders
Authorize Trustee To Effectuate Subordination of Securities.

 

Each Holder by
its acceptance of them authorizes and expressly directs the Trustee on its
behalf to take such action as may be necessary or appropriate to effectuate, as
between the holders of Senior Debt and the Holders, the subordination provided
in this Article Ten, and appoints the Trustee its attorney-in-fact for such
purposes, including, in the event of any dissolution, winding-up, liquidation
or reorganization of the Issuer (whether in bankruptcy, insolvency,
receivership, reorganization or similar proceedings or upon an assignment for
the benefit of credits or otherwise) tending towards liquidation of the
business and assets of the Issuer, the filing of a claim for the unpaid balance
of its Securities and accrued interest in the form required in those
proceedings.

 

If the Trustee
does not file a proper claim or proof of debt in the form required in such
proceeding prior to 30 days before the expiration of the time to file such
claim or claims, then the holders of the Senior Debt or their Representative
are or is hereby authorized to have the right to file and are or is hereby
authorized to file an appropriate claim for and on

 

119

 

behalf of the Holders of said
Securities. Nothing herein contained shall be deemed to authorize the Trustee
or the holders of Senior Debt or their Representative to authorize or consent
to or accept or adopt on behalf of any Holder any plan of reorganization,
arrangement, adjustment or composition affecting the Securities or the rights
of any Holder thereof, or to authorize the Trustee or the holders of Senior
Debt or their Representative to vote in respect of the claim of any Holder in
any such proceeding.

 

SECTION 10.12.                                   This
Article Ten Not To Prevent Events of Default.

 

The failure to
make a payment on account of principal of or interest on the Securities by
reason of any provision of this Article Ten will not be construed as preventing
the occurrence of an Event of Default.

 

SECTION 10.13.                                   Trustee’s
Compensation Not Prejudiced.

 

Nothing in
this Article Ten will apply to amounts due to the Trustee (other than payments
of Obligation owing to Holders in respect of Securities) pursuant to other sections
of this Indenture.

 

ARTICLE ELEVEN

 

GUARANTEES

 

SECTION 11.01.                                   Unconditional
Guarantee.

 

Subject to the
provisions of this Article Eleven, each of the Guarantors hereby, jointly and
severally, unconditionally and irrevocably guarantees, on a senior subordinated
basis to each Holder of a Security authenticated and delivered by the Trustee
and to the Trustee and its successors and assigns, irrespective of the validity
and enforceability of this Indenture, the Securities or the obligations of the
Issuer or any other Guarantors to the Holders or the Trustee hereunder or
thereunder: (a) (x) the due and punctual payment of the principal of, premium,
if any, and interest on the Securities when and as the same shall become due
and payable, whether at maturity, upon redemption or repurchase, by
acceleration or otherwise, (y) the due and punctual payment of interest on the
overdue principal and (to the extent permitted by law) interest, if any, on the
Securities and (z) the due and punctual payment and performance of all other
obligations of the Issuer and all other obligations of the other Guarantors
(including under the Guarantees), in each case, to the Holders or the Trustee
hereunder or thereunder (including amounts due the Trustee under Section 7.07
hereof), all in accordance with the terms hereof and thereof (collectively, the
“Guarantee
Obligations”); and (b) in case of any extension of time of
payment or renewal of any Securities or any of such other obligations, the due
and punctual payment and performance of Guarantee Obligations in

 

120

 

accordance with the terms of
the extension or renewal, whether at maturity, upon redemption or repurchase,
by acceleration or otherwise. Failing payment when due of any amount so
guaranteed, or failing performance of any other obligation of the Issuer to the
Holders under this Indenture or under the Securities, for whatever reason, each
Guarantor shall be obligated to pay, or to perform or cause the performance of,
the same immediately. An Event of Default under this Indenture or the
Securities shall constitute an event of default under the Subsidiary
Guarantees, and shall entitle the Holders to accelerate the obligations of the
Guarantors thereunder in the same manner and to the same extent as the
obligations of the Issuer.

 

Each of the
Guarantors hereby agrees that its obligations hereunder shall be unconditional,
irrespective of the validity, regularity or enforceability of the Securities or
this Indenture, the absence of any action to enforce the same, any waiver or
consent by any Holder with respect to any provisions hereof or thereof, any
release of any other Guarantor, the recovery of any judgment against the
Issuer, any action to enforce the same, whether or not a Guarantee is affixed
to any particular Security, or any other circumstance which might otherwise
constitute a legal or equitable discharge or defense of a Guarantor. Each of
the Guarantors hereby waives the benefit of diligence, presentment, demand of
payment, filing of claims with a court in the event of insolvency or bankruptcy
of the Issuer, any right to require a proceeding first against the Issuer,
protest, notice and all demands whatsoever and covenants that its Subsidiary
Guarantee shall not be discharged except by complete performance of the
obligations contained in the Securities, this Indenture and the Guarantee. The
Guarantee is a guarantee of payment and not of collection. If any Holder or the
Trustee is required by any court or otherwise to return to the Issuer or to any
Guarantor, or any custodian, trustee, liquidator or other similar official
acting in relation to the Issuer or such Guarantor, any amount paid by the
Issuer or such Guarantor to the Trustee or such Holder, the Guarantee, to the
extent theretofore discharged, shall be reinstated in full force and effect.
Each Guarantor further agrees that, as between it, on the one hand, and the
Holders of Securities and the Trustee, on the other hand, (a) subject to this
Article Eleven, the maturity of the obligations guaranteed hereby may be
accelerated as provided in Article Six for the purposes of the Guarantee,
notwithstanding any stay, injunction or other prohibition preventing such
acceleration in respect of the obligations guaranteed hereby, and (b) in the
event of any acceleration of such obligations as provided in Article Six
hereof, such obligations (whether or not due and payable) shall forthwith
become due and payable by the Guarantors for the purpose of the Guarantee.

 

SECTION 11.02.                                   Subordination
of Guarantee.

 

The
obligations of each Guarantor under its Guarantee pursuant to this Article
Eleven shall be junior and subordinated to the prior payment in full in cash
or Cash Equivalents of the Senior Debt of such Guarantor on the same basis as
the Securities are junior and subordinated to Senior Debt of the Issuer. For
the purposes of the foregoing sentence, the Trustee and the Holders shall have
the right to receive and/or retain payments by any of the

 

121

 

Guarantors only at such times
as they may receive and/or retain payments in respect of the Securities
pursuant to this Indenture, including Article Ten hereof.

 

SECTION 11.03.                                   Limitation
on Guarantor Liability.

 

Each
Guarantor, and by its acceptance of Securities, each Holder, hereby confirms
that it is the intention of all such parties that the Guarantee of such
Guarantor not constitute a fraudulent transfer or conveyance for purposes of
Bankruptcy Law, the Uniform Fraudulent Conveyance Act, the Uniform Fraudulent
Transfer Act or any similar federal or state law to the extent applicable to
any Guarantee. To effectuate the foregoing intention, the Trustee, the Holders
and the Guarantors hereby irrevocably agree that the obligations of such Guarantor
under its Guarantee and this Article Eleven shall be limited to the maximum
amount as will, after giving effect to such maximum amount and all other
contingent and fixed liabilities of such Guarantor that are relevant under such
laws, and after giving effect to any collections from, rights to receive
contribution from or payments made by or on behalf of any other Guarantor in
respect of the obligations of such other Guarantor under this Article Eleven,
result in the obligations of such Guarantor under its Guarantee not
constituting a fraudulent transfer or conveyance.

 

SECTION 11.04.                                   Execution
and Delivery of Subsidiary Guarantee for Future Guarantors.

 

To further
evidence its Guarantee set forth in Section 11.01, each Subsidiary and other
Person that is required to become a Guarantor hereby agrees to execute a
supplement to this Indenture or a Guarantee, substantially in the form of Exhibit
H hereto, and deliver it to the Trustee. Such Guarantee or supplement to
this Indenture shall be executed on behalf of each Guarantor by either manual
or facsimile signature of one Officer or other person duly authorized by all
necessary corporate action of each Guarantor who shall have been duly
authorized to so execute by all requisite corporate action. The validity and
enforceability of any Guarantee shall not be affected by the fact that it is
not affixed to any particular Security.

 

Each of the
Guarantors hereby agrees that its Guarantee set forth in Section 11.01 shall
remain in full force and effect notwithstanding any failure to endorse on each
Security a notation of such Guarantee.

 

If an Officer
of a Guarantor whose signature is on this Indenture or a Guarantee no longer
holds that office at the time the Trustee authenticates the Security on which
such Guarantee is endorsed or at any time thereafter, such Guarantor’s
Guarantee of such Security shall nevertheless be valid.

 

The delivery
of any Security by the Trustee, after the authentication thereof hereunder,
shall constitute due delivery of any Guarantee set forth in this Indenture on
behalf of each Guarantor.

 

122

 

SECTION 11.05.                                   Release
of a Guarantor.

 

The Guarantee
of a Guarantor will be released:

 

(1)           (a) upon the sale,
disposition or other transfer (including through merger or consolidation) of
all of the Capital Stock (or any sale, disposition or other transfer of Capital
Stock following which the applicable Guarantor is no longer a Restricted
Subsidiary), or all or substantially all the assets, of the applicable
Guarantor if such sale, disposition or other transfer is made in compliance
with the applicable provisions of this Indenture,

 

(b)           if the Issuer designates any
Restricted Subsidiary that is a Guarantor as an Unrestricted Subsidiary in
accordance with Section 4.11 and the definition of “Unrestricted Subsidiary,”
or

 

(c)           in the case of any Restricted
Subsidiary which after the Issue Date is required to guarantee the Securities
pursuant to Section 4.16, upon the release or discharge of the guarantee by such
Restricted Subsidiary of Indebtedness of the Issuer or any Restricted
Subsidiary of the Issuer or such Restricted Subsidiary or the
repayment of the Indebtedness or Disqualified Stock, in each case, which
resulted in the obligation to guarantee the Securities; and

 

(2) in the case of clause (1)(a) above, if such Guarantor is released
from its guarantee, if any, of, and all pledges and security, if any, granted
in connection with, the Credit Agreement and any other Indebtedness of the
Issuer or any Restricted Subsidiary;

 

provided, however, in any case that any
such termination shall occur only to the extent that all obligations of such
Guarantor under all of its Guarantees of any Indebtedness of the Issuer or any
Indebtedness of any other Guarantor shall also terminate upon such release and none of its Equity
Interests are pledged for the benefit of any holder of any Indebtedness of the
Issuer or any Indebtedness of any Restricted Subsidiary of the Issuer.

 

The Trustee shall execute an appropriate instrument prepared by the
Issuer evidencing the release of a Guarantor from its obligations under its
Guarantee upon receipt of a request by the Issuer or such Guarantor accompanied
by an Officers’ Certificate and an Opinion of Counsel certifying as to the
compliance with this Section 11.05; provided, however, that
the legal counsel delivering such Opinion of Counsel may rely as to matters of
fact on one or more Officers’ Certificates of the Issuer.

 

Except as set forth in Articles Four and Five and this Section 11.05,
nothing contained in this Indenture or in any of the Securities shall prevent
any consolidation or merger of a Guarantor with or into the Issuer or another
Guarantor or shall prevent any sale or

 

123

 

conveyance of the property of a
Guarantor as an entirety or substantially as an entirety to the Issuer or
another Guarantor.

 

SECTION 11.06.                                   Waiver
of Subrogation.

 

Until this
Indenture is discharged and all of the Securities are discharged and paid in
full, each Guarantor hereby irrevocably waives and agrees not to exercise any
claim or other rights which it may now or hereafter acquire against the Issuer
that arise from the existence, payment, performance or enforcement of the
Issuer’s obligations under the Securities or this Indenture and such Guarantor’s
obligations under the Guarantee and this Indenture, in any such instance
including, without limitation, any right of subrogation, reimbursement,
exoneration, contribution, indemnification, and any right to participate in any
claim or remedy of the Holders against the Issuer, 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 Issuer,
directly or indirectly, in cash or other assets or by set-off 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 any amounts owing to the Trustee or the Holders under the Securities, this
Indenture, or any other document or instrument delivered under or in connection
with such agreements or instruments, 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 Trustee or the Holders
and shall forthwith be paid to the Trustee for the benefit of itself or such
Holders to be credited and applied to the obligations in favor of the Trustee or
the Holders, as the case may be, 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
11.06 is knowingly made in contemplation of such benefits.

 

SECTION 11.07.                                   Immediate
Payment.

 

Each Guarantor
agrees to make immediate payment to the Trustee on behalf of the Holders of all
Guarantee Obligations owing or payable to the respective Holders upon receipt
of a demand for payment therefor by the Trustee to such Guarantor in writing.

 

SECTION 11.08.                                   No
Setoff.

 

Each payment
to be made by a Guarantor hereunder in respect of the Guarantee Obligations
shall be payable in the currency or currencies in which such Guarantee
Obligations are denominated, and shall be made without set-off, counterclaim,
reduction or diminution of any kind or nature.

 

124

 

SECTION 11.09.                                   Guarantee
Obligations Absolute.

 

Subject to the
provisions of Section 11.02, the obligations of each Guarantor hereunder are
and shall be absolute and unconditional and any monies or amounts expressed to
be owing or payable by each Guarantor hereunder which may not be recoverable
from such Guarantor on the basis of a Guarantee shall be recoverable from such
Guarantor as a primary obligor and principal debtor in respect thereof.

 

SECTION 11.10.                                   Guarantee
Obligations Continuing.

 

The
obligations of each Guarantor hereunder shall be continuing and shall remain in
full force and effect until all such obligations have been paid and satisfied
in full. Each Guarantor agrees with the Trustee that it will from time to time
deliver to the Trustee suitable acknowledgments of this continued liability
hereunder and under any other instrument or instruments in such form as counsel
to the Trustee may advise and as will prevent any action brought against it in
respect of any default hereunder being barred by any statute of limitations now
or hereafter in force and, in the event of the failure of a Guarantor so to do,
it hereby irrevocably appoints the Trustee the attorney and agent of such
Guarantor to make, execute and deliver such written acknowledgment or
acknowledgments or other instruments as may from time to time become necessary
or advisable, in the judgment of the Trustee on the advice of counsel, to fully
maintain and keep in force the liability of such Guarantor hereunder.

 

SECTION 11.11.                                   Guarantee
Obligations Not Reduced.

 

The
obligations of each Guarantor hereunder shall not be satisfied, reduced or
discharged solely by the payment of such principal, premium, if any, interest,
fees and other monies or amounts as may at any time prior to discharge of this
Indenture pursuant to Article Eight be or become owing or payable under or by
virtue of or otherwise in connection with the Securities or this Indenture.

 

SECTION 11.12.                                   Guarantee
Obligations Reinstated.

 

The
obligations of each Guarantor hereunder shall continue to be effective or shall
be reinstated, as the case may be, if at any time any payment which would
otherwise have reduced the obligations of any Guarantor hereunder (whether such
payment shall have been made by or on behalf of the Issuer or by or on behalf
of a Guarantor) is rescinded or reclaimed from any of the Holders upon the
insolvency, bankruptcy, liquidation or reorganization of the Issuer or any
Guarantor or otherwise, all as though such payment had not been made. If demand
for, or acceleration of the time for, payment by the Issuer or any other
Guarantor is stayed upon the insolvency, bankruptcy, liquidation or
reorganization of the Issuer or such Guarantor, all such Indebtedness otherwise
subject to demand for payment or acceleration shall nonetheless be payable by
each Guarantor as provided herein.

 

125

 

SECTION 11.13.                                   Guarantee
Obligations Not Affected.

 

The
obligations of each Guarantor hereunder shall not be affected, impaired or
diminished in any way by any act, omission, matter or thing whatsoever,
occurring before, upon or after any demand for payment hereunder (and whether
or not known or consented to by any Guarantor or any of the Holders) which, but
for this provision, might constitute a whole or partial defense to a claim
against any Guarantor hereunder or might operate to release or otherwise
exonerate any Guarantor from any of its obligations hereunder or otherwise
affect such obligations, whether occasioned by default of any of the Holders or
otherwise, including, without limitation:

 

(a)           any limitation of status or power,
disability, incapacity or other circumstance relating to the Issuer or any
other Person, including any insolvency, bankruptcy, liquidation,
reorganization, readjustment, composition, dissolution, winding-up or other
proceeding involving or affecting the Issuer or any other Person;

 

(b)           any irregularity,
defect, unenforceability or invalidity in respect of any indebtedness or other
obligation of the Issuer or any other Person under this Indenture, the
Securities or any other document or instrument;

 

(c)           any failure of the
Issuer or any other Guarantor, whether or not without fault on its part, to
perform or comply with any of the provisions of this Indenture, the Securities
or any Guarantee, or to give notice thereof to a Guarantor;

 

(d)           the taking or
enforcing or exercising or the refusal or neglect to take or enforce or
exercise any right or remedy from or against the Issuer or any other Person or
their respective assets or the release or discharge of any such right or
remedy;

 

(e)           the granting of
time, renewals, extensions, compromises, concessions, waivers, releases,
discharges and other indulgences to the Issuer or any other Person;

 

(f)            any change in the
time, manner or place of payment of, or in any other term of, any of the
Securities, or any other amendment, variation, supplement, replacement or
waiver of, or any consent to departure from, any of the Securities or this
Indenture, including, without limitation, any increase or decrease in the
principal amount of or premium, if any, or interest on any of the Securities;

 

(g)           any change in the
ownership, control, name, objects, businesses, assets, capital structure or
constitution of the Issuer or a Guarantor;

 

(h)           any merger or amalgamation of the
Issuer or a Guarantor with any Person or Persons;

 

126

 

(i)            the occurrence of any change in the
laws, rules, regulations or ordinances of any jurisdiction by any present or
future action of any governmental authority or court amending, varying,
reducing or otherwise affecting, or purporting to amend, vary, reduce or
otherwise affect, any of the Guarantee Obligations or the obligations of a
Guarantor under its Guarantee; and

 

(j)            any other circumstance, including
release of the Guarantor pursuant to Section 11.05 (other than by complete,
irrevocable payment) that might otherwise constitute a legal or equitable
discharge or defense of the Issuer under this Indenture or the Securities or of
a Guarantor in respect of its Guarantee hereunder.

 

SECTION 11.14.                                   Waiver.

 

Without in any
way limiting the provisions of Section 11.01, each Guarantor hereby waives
notice of acceptance hereof, notice of any liability of any Guarantor
hereunder, notice or proof of reliance by the Holders upon the obligations of
any Guarantor hereunder, and diligence, presentment, demand for payment on the
Issuer, protest, notice of dishonor or non-payment of any of the Guarantee
Obligations, or other notice or formalities to the Issuer or any Guarantor of
any kind whatsoever.

 

SECTION 11.15.                                   No
Obligation To Take Action Against the Issuer.

 

Neither the
Trustee nor any other Person shall have any obligation to enforce or exhaust
any rights or remedies against the Issuer or any other Person or any property
of the Issuer or any other Person before the Trustee is entitled to demand
payment and performance by any or all Guarantors of their liabilities and
obligations under their Guarantees or under this Indenture.

 

SECTION 11.16.                                   Dealing
with the Issuer and Others.

 

The Holders,
without releasing, discharging, limiting or otherwise affecting in whole or in
part the obligations and liabilities of any Guarantor hereunder and without the
consent of or notice to any Guarantor, may

 

(a)           grant time, renewals, extensions,
compromises, concessions, waivers, releases, discharges and other indulgences
to the Issuer or any other Person;

 

(b)           take or abstain from taking security
or collateral from the Issuer or from perfecting security or collateral of the
Issuer;

 

(c)           release, discharge, compromise,
realize, enforce or otherwise deal with or do any act or thing in respect of
(with or without consideration) any and all collateral,

 

127

 

mortgages or
other security given by the Issuer or any third party with respect to the
obligations or matters contemplated by this Indenture or the Securities;

 

(d)           accept compromises or arrangements
from the Issuer;

 

(e)           apply all monies at any time received
from the Issuer or from any security upon such part of the Guarantee
Obligations as the Holders may see fit or change any such application in whole
or in part from time to time as the Holders may see fit; and

 

(f)            otherwise deal with, or waive or
modify their right to deal with, the Issuer and all other Persons and any
security as the Holders or the Trustee may see fit.

 

SECTION 11.17.                                   Default
and Enforcement.

 

If any
Guarantor fails to pay in accordance with Section 11.07 hereof, the Trustee may
proceed in its name as trustee hereunder in the enforcement of the Subsidiary
Guarantee of any such Guarantor and such Guarantor’s obligations thereunder and
hereunder by any remedy provided by law, whether by legal proceedings or
otherwise, and to recover from such Guarantor the obligations.

 

SECTION 11.18.                                   Amendment,
Etc.

 

No amendment,
modification or waiver of any provision of this Indenture relating to any
Guarantor or consent to any departure by any Guarantor or any other Person from
any such provision will in any event be effective unless it is signed by such
Guarantor and the Trustee.

 

SECTION 11.19.                                   Acknowledgment.

 

Each
Guarantor, if any, hereby acknowledges communication of the terms of this
Indenture and the Securities and consents to and approves of the same.

 

SECTION 11.20.                                   Costs
and Expenses.

 

Each Guarantor
shall pay on demand by the Trustee any and all costs, fees and expenses
(including, without limitation, legal fees on a solicitor and client basis)
incurred by the Trustee, its agents, advisors and counsel or any of the Holders
in enforcing any of their rights under any Guarantee.

 

SECTION 11.21.                                   No
Merger or Waiver; Cumulative Remedies.

 

No Guarantee
shall operate by way of merger of any of the obligations of a Guarantor under
any other agreement, including, without limitation, this Indenture. No failure

 

128

 

to exercise and no delay in
exercising, on the part of the Trustee or the Holders, any right, remedy, power
or privilege hereunder or under this Indenture or the Securities, shall operate
as a waiver thereof; nor shall any single or partial exercise of any right,
remedy, power or privilege hereunder or under this Indenture or the Securities
preclude any other or further exercise thereof or the exercise of any other
right, remedy, power or privilege. The rights, remedies, powers and privileges
in the Guarantee and under this Indenture, the Securities and any other
document or instrument between a Guarantor and/or the Issuer and the Trustee
are cumulative and not exclusive of any rights, remedies, powers and privilege
provided by law.

 

SECTION 11.22.                                   Survival
of Guarantee Obligations.

 

Without
prejudice to the survival of any of the other obligations of each Guarantor
hereunder, the obligations of each Guarantor under Section 11.01 shall survive
the payment in full of the Guarantee Obligations and shall be enforceable
against such Guarantor without regard to and without giving effect to any
defense, right of offset or counterclaim available to or which may be asserted
by the Issuer or any Guarantor.

 

SECTION 11.23.                                   Guarantee
in Addition to Other Guarantee Obligations.

 

The
obligations of each Guarantor under its Guarantee and this Indenture are in
addition to and not in substitution for any other obligations to the Trustee or
to any of the Holders in relation to this Indenture or the Securities and any
guarantees or security at any time held by or for the benefit of any of them.

 

SECTION 11.24.                                   Severability.

 

Any provision
of this Article Eleven which is prohibited or unenforceable in any jurisdiction
shall not invalidate the remaining provisions and any such prohibition or
unenforceability in any jurisdiction shall not invalidate or render
unenforceable such provision in any other jurisdiction unless its removal would
substantially defeat the basic intent, spirit and purpose of this Indenture and
this Article Eleven.

 

SECTION 11.25.                                   Successors
and Assigns.

 

Each Guarantee
shall be binding upon and inure to the benefit of each Guarantor and the
Trustee and the other Holders and their respective successors and permitted
assigns, except that no Guarantor may assign any of its obligations hereunder
or thereunder.

 

129

 

ARTICLE TWELVE

 

MISCELLANEOUS

 

SECTION 12.01.                                   TIA
Controls.

 

If any
provision of this Indenture limits, qualifies, or conflicts with another
provision which is required or deemed to be included in this Indenture by the
TIA, such required or deemed provision shall control.

 

SECTION 12.02.                                   Notices.

 

Any notices or
other communications required or permitted hereunder shall be in writing, and
shall be sufficiently given if made by hand delivery, by telex, by nationally
recognized overnight courier service, by telecopier or registered or certified
mail, postage prepaid, return receipt requested, addressed as follows:

 

if to the
Issuer:

 

WMG
Acquisition Corp.

c/o Warner
Music Group, Inc.

75 Rockefeller
Plaza,

New York, NY
10019

Attention:
General Counsel

 

Telephone:                 (212)
275-2030

Facsimile:                         (212)
258-3092

 

with a copy
to:

 

Simpson
Thacher & Bartlett LLP

425 Lexington
Avenue

New York, NY
10017

Attention:
Edward P. Tolley III

 

Telephone:                 (212)
455-2000

Facsimile:                         (212)
455-2502

 

130

 

if to the
Trustee:

 

Wells Fargo
Bank, National Association

Corporate
Trust Department

Sixth Street
and Marquette Avenue

N9303-120

Minneapolis,
MN 55179

Attention:
Jeffery Rose

 

Telephone:                 (612)
667-0337

Facsimile:                         (612)
667-9825

 

Each of the
Issuer and the Trustee by written notice to each other such Person may
designate additional or different addresses for notices to such Person. Any
notice or communication to the Issuer and the Trustee, shall be deemed to have
been given or made as of the date so delivered if personally delivered; when
answered back; when receipt is acknowledged, if telecopied; five (5) calendar
days after mailing if sent by registered or certified mail, postage prepaid
(except that a notice of change of address shall not be deemed to have been
given until actually received by the addressee); and next Business Day if by
nationally recognized overnight courier service.

 

Any notice or
communication mailed to a Securityholder shall be mailed to him by first class
mail or other equivalent means at his address as it appears on the registration
books of the Registrar and shall be sufficiently given to him if so mailed
within the time prescribed.

 

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

 

SECTION 12.03.                                   Communications
by Holders with Other Holders.

 

Securityholders
may communicate pursuant to TIA § 312(b) with other Securityholders with
respect to their rights under this Indenture, the Securities or the Subsidiary
Guarantees. The Issuer, the Trustee, the Registrar and any other Person shall
have the protection of TIA § 312(c).

 

SECTION 12.04.                                   Certificate
and Opinion as to Conditions Precedent.

 

Upon any
request or application by the Issuer to the Trustee to take any action under
this Indenture, the Issuer shall furnish to the Trustee at the request of the
Trustee:

 

131

 

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

 

(2)           an Opinion of
Counsel stating that, in the opinion of such counsel, any and all such
conditions precedent have been complied with.

 

SECTION 12.05.                                   Statements
Required in Certificate or Opinion.

 

Each
certificate or opinion with respect to compliance with a condition or covenant
provided for in this Indenture, other than the Officers’ Certificate required
by Section 4.06, shall include:

 

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

 

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

 

(3)           a statement that, in
the opinion of such Person, he 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 complied with or satisfied; and

 

(4)           a statement as to
whether or not, in the opinion of each such Person, such condition or covenant
has been complied with; provided, however, that with respect to
matters of fact an Opinion of Counsel may rely on an Officers’ Certificate or
certificates of public officials.

 

SECTION 12.06.                                   Rules
by Trustee, Paying Agent, Registrar.

 

The Trustee,
Paying Agent or Registrar may make reasonable rules for its functions.

 

SECTION 12.07.                                   Legal
Holidays.

 

If a payment
date is not a Business Day, payment may be made on the next succeeding day that
is a Business Day.

 

132

 

SECTION 12.08.                                   Governing
Law.

 

This Indenture, the Securities and the
Guarantees, if any, will be governed by and construed in accordance with the
laws of the State of New York.

 

SECTION 12.09.                                   No
Adverse Interpretation of Other Agreements.

 

This Indenture
may not be used to interpret another indenture, loan or debt agreement of the
Issuer or any of its Subsidiaries. Any such indenture, loan or debt agreement
may not be used to interpret this Indenture.

 

SECTION 12.10.                                   No
Recourse Against Others.

 

No director,
officer, employee, incorporator or stockholder of the Issuer or any direct or
indirect parent corporation or of any Guarantor, as such, shall have any
liability for any obligations of the Issuer or the Guarantors under the
Securities or this Indenture or for any claim based on, in respect of, or by
reason of, such obligations or their creation. Each Holder by accepting a
Security waives and releases all such liability. Such waiver and release are
part of the consideration for issuance of the Securities.

 

SECTION 12.11.                                   Successors.

 

All agreements
of the Issuer in this Indenture and the Securities shall bind its successors.
All agreements of the Trustee in this Indenture shall bind its successor.

 

SECTION 12.12.                                   Duplicate
Originals.

 

All parties
may sign any number of copies of this Indenture. Each signed copy or
counterpart shall be an original, but all of them together shall represent the
same agreement.

 

SECTION 12.13.                                   Severability.

 

In case any
one or more of the provisions in this Indenture or in the Securities shall be
held invalid, illegal or unenforceable, in any respect for any reason, the
validity, legality and enforceability of any such provision in every other
respect and of the remaining provisions shall not in any way be affected or
impaired thereby, it being intended that all of the provisions hereof shall be
enforceable to the full extent permitted by law.

 

SECTION 12.14.                                   Currency
of Account; Conversion of Currency; Foreign Exchange Restrictions.

 

(a)           U.S.
Dollars are the sole currency of account
and payment for all sums payable by the Issuer and the Guarantors under
or in connection with the Dollar Securities,

 

133

 

the Guarantees of the Dollar
Securities or this Indenture to the extent it relates to the Dollar Securities,
including damages related thereto, and pounds sterling are the sole currency of
account and payment for all sums payable by the Issuer and the Guarantors under
or in connection with the Sterling Securities, the Guarantees of the Sterling
Securities or this Indenture to the extent it relates to the Sterling
Securities, including damages related thereto. Any amount received or recovered
in a currency other than U.S. Dollars by a Holder of Dollar Securities or
pounds sterling by a Holder of Sterling Securities (whether as a result of, or
of the enforcement of, a judgment or order of a court of any jurisdiction, in
the winding-up or dissolution of the Issuer or otherwise) in respect of any sum
expressed to be due to it from the Issuer shall only constitute a discharge to the Issuer to the
extent of the U.S. Dollar or pounds sterling amount, as the case may be, which
the recipient is able to purchase with the amount so received or recovered in
that other currency on the date of that receipt or recovery (or, if it is not
practicable to make that purchase on that date, on the first date on which it
is practicable to do so). If that U.S. Dollar or pounds sterling amount is less
than the U.S. Dollar or pounds sterling amount expressed to be due to the
recipient under the applicable Securities, the Issuer shall indemnify it
against any loss sustained by it as a result as set forth in Section 12.14(b).
In any event, the Issuer and the Guarantors shall indemnify the recipient
against the cost of making any such purchase. For the purposes of this Section
12.14, it will be sufficient for the Holder of a Security to certify in a
satisfactory manner (indicating sources of information used) that it would have
suffered a loss had an actual purchase of U.S. Dollars or pounds sterling, as
the case may be, been made with the amount so received in that other currency
on the date of receipt or recovery (or, if a purchase of U.S. Dollars or pounds
sterling, as applicable, on such date had not been practicable, on the first
date on which it would have been practicable, it being required that the need
for a change of date be certified in the manner mentioned above). The
indemnities set forth in this Section 12.14 constitute separate and independent
obligations from other obligations of the Issuer and the Guarantors, shall give
rise to a separate and independent cause of action, shall apply irrespective of
any indulgence granted by any Holder of the Securities and shall continue in
full force and effect despite any other judgment, order, claim or proof for a
liquidated amount in respect of any sum due under the Securities.

 

(b)           The Issuer and the Guarantors,
jointly and severally, covenant and agree that the following provisions shall
apply to conversion of currency in the case of the Securities, the Guarantees
and this Indenture:

 

(1)           (A)          If for the purpose of obtaining
judgment in, or enforcing the judgment of, any court in any country, it becomes
necessary to convert into a currency (the “Judgment Currency”) an
amount due in any other currency (the “Base Currency”),
then the conversion shall be made at the rate of exchange prevailing on the
Business Day before the day on which the judgment is given or the order of
enforcement is made, as the case may be (unless a court shall otherwise
determine).

 

134

 

(B)           If there is a change
in the rate of exchange prevailing between the Business Day before the day on
which the judgment is given or an order of enforcement is made, as the case may
be (or such other date as a court shall determine), and the date of receipt of
the amount due, the Issuer and the Guarantors will pay such additional (or, as
the case may be, such lesser) amount, if any, as may be necessary so that the
amount paid in the Judgment Currency when converted at the rate of exchange
prevailing on the date of receipt will produce the amount in the Base Currency
originally due.

 

(2)           In the event of the
winding-up of the Issuer or any Guarantor at any time while any amount or
damages owing under the Securities, the Guarantees and this Indenture, or any
judgment or order rendered in respect thereof, shall remain outstanding, the
Issuer and the Guarantors shall indemnify and hold the Holders and the Trustee
harmless against any deficiency arising or resulting from any variation in
rates of exchange between (i) the date as of which the U.S. Dollar Equivalent
or equivalent amount in pounds sterling, as applicable, of the amount due or
contingently due under the Securities, the Guarantees and this Indenture (other
than under this subsection (b)(2)) is calculated for the purposes of such
winding-up and (ii) the final date for the filing of proofs of claim in such
winding-up. For the purpose of this subsection (b)(2), the final date for the
filing of proofs of claim in the winding-up of the Issuer or any Guarantor
shall be the date fixed by the liquidator or otherwise in accordance with the
relevant provisions of applicable law as being the latest practicable date as
at which liabilities of the Issuer or such Guarantor may be ascertained for
such winding-up prior to payment by the liquidator or otherwise in respect
thereto.

 

(c)           The obligations contained in
subsections (a), (b)(1)(B) and (b)(2) of this Section 12.14 shall constitute
separate and independent obligations from the other obligations of the Issuer
and the Guarantors under this Indenture, shall give rise to separate and
independent causes of action against the Issuer and the Guarantors, shall apply
irrespective of any waiver or extension granted by any Holder or the Trustee or
either of them from time to time and shall continue in full force and effect
notwithstanding any judgment or order or the filing of any proof of claim in
the winding-up of the Issuer or any Guarantor for a liquidated sum in respect
of amounts due hereunder (other than under subsection (b)(2) above) or under
any such judgment or order. Any such deficiency as aforesaid shall be deemed to
constitute a loss suffered by the Holders or the Trustee, as the case may be,
and no proof or evidence of any actual loss shall be required by the Issuer or
any Guarantor or the liquidator or otherwise or any of them. In the case of
subsection (b)(2) above, the amount of such deficiency shall not be deemed to
be reduced by any variation in rates of exchange occurring between the said
final date and the date of any liquidating distribution.

 

(d)           The term “rate(s) of exchange” shall
mean the rate of exchange quoted by Reuters at 10:00 a.m. (New York time) for
spot purchases of the Base Currency with the

 

135

 

Judgment Currency other than
the Base Currency referred to in subsections (b)(1) and (b)(2) above and
includes any premiums and costs of exchange payable.

 

136

 

SIGNATURES

 

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

 

	
   

  	
  WMG ACQUISITION CORP.,

  as the Issuer

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ Paul
  Robinson

  
	
   

  	
   

  	
  Name: Paul
  Robinson

  Title: Vice President

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  By each of
  the Subsidiaries listed on Schedule I hereto:

  
	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ Paul
  Robinson

  
	
   

  	
   

  	
  Name: Paul
  Robinson

  Title: Vice President

  

 

 

	
   

  	
  WELLS FARGO
  BANK,

  NATIONAL ASSOCIATION,

    as Trustee

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ Frank
  McDonald

  
	
   

  	
   

  	
  Name: Frank
  McDonald

  Title: Vice President

  

 

S-2

EXHIBIT A

 

[FORM OF INITIAL DOLLAR SECURITY]

 

WMG ACQUISITION CORP.

7 3/8% Senior Subordinated Notes due 2014

 

CUSIP No.     

ISIN No.     

 

	
  No.

  	
  $[

  	
  ]

  

 

WMG
ACQUISITION CORP., a Delaware corporation (the “Company,” which term includes
any successor corporation), for value received promises to pay to CEDE &
CO. or its registered assigns, the principal sum of [                      ]
dollars ($[                      ])
on April 15, 2014.

 

Interest
Payment Dates: April 15 and October 15, commencing October 15, 2004.

 

Record Dates:
April 1 and October 1.

 

Reference is
made to the further provisions of this Dollar Security contained herein, which
will for all purposes have the same effect as if set forth at this place.

 

A-1

 

IN WITNESS
WHEREOF, the Company has caused this Security to be signed manually or by
facsimile by its duly authorized officers.

 

	
   

  	
  WMG
  ACQUISITION CORP.

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
   

  
	
   

  	
   

  	
  Name:

  
	
   

  	
   

  	
  Title:

  

 

A-2

 

CERTIFICATE OF AUTHENTICATION

 

This is one of
the 7 3/8% Senior Subordinated Notes due 2014 described in the within-mentioned
Indenture.

 

	
  Dated:

  	
  WELLS FARGO
  BANK,

  NATIONAL ASSOCIATION,

  as Trustee

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
   

  
	
   

  	
   

  	
  Authorized
  Signatory

  

 

A-3

 

(Reverse of Dollar Security)

WMG Acquisition Corp.

 

7 3/8% Senior Subordinated Notes due 2014

 

[Insert the Global Security Legend, if applicable pursuant to the provisions of the Indenture]

 

[Insert the Private
Placement Legend, if applicable
pursuant to the provisions of the
Indenture]

 

Capitalized
terms used herein shall have the meanings assigned to them in the Indenture
referred to below unless otherwise indicated.

 

SECTION 1.  Interest. WMG Acquisition Corp., a
Delaware corporation (the “Company”), promises to pay interest on the
principal amount of this Dollar Security at 7 3/8% per annum from April 8, 2004
until maturity. The Company will pay interest semiannually on April 15 and
October 15 of each year, or if any such day is not a Business Day, on the next
succeeding Business Day (each an “Interest
Payment Date”). Interest
on the Dollar Securities will accrue from the most recent date to which
interest has been paid or, if no interest has been paid, from the date of
original issuance; provided that
if there is no existing Default in the payment of interest, and if this Dollar
Security 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 October 15, 2004. The Company shall
pay interest (including post-petition interest in any proceeding under any
Bankruptcy Law) on overdue principal and premium, if any, from time to time on
demand to the extent lawful at the interest rate applicable to the Dollar
Securities; it shall pay interest (including post-petition interest in any
proceeding under any Bankruptcy Law) on overdue installments of interest
(without regard to any applicable grace periods) from time to time on demand at
the same rate to the extent lawful. Interest will be computed on the basis of a
360-day year of twelve 30 day months.

 

SECTION 2.  Method of Payment. The Company will pay
interest on the Dollar Securities (except defaulted interest) to the Persons
who are registered Holders of Dollar Securities at the close of business on the
April 1 or October 1 next preceding the Interest Payment Date, even if such
Dollar Securities are canceled after such record date and on or before such
Interest Payment Date, except as provided in Section 2.13 of the Indenture with
respect to defaulted interest. The Dollar Securities will be issued in
denominations of $5,000 and integral multiples of $1,000. The Company shall pay
principal, premium, if any and interest on the Dollar Securities 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 (“U.S. Legal Tender”). Principal, premium, if any, and
interest on the Dollar Securities will be payable at the office or agency of
the Company maintained for such purpose or, at the option of the

 

A-4

 

Company, payment of interest
may be made by check mailed to the Holders at their respective addresses set
forth in the register of Holders; provided that
all payments of principal, premium and interest with respect to Dollar
Securities the Holders of which have given wire transfer instructions to the
Company prior to the Record Date will be required to be made by wire transfer
of immediately available funds to the accounts specified by the Holders
thereof. Until otherwise designated by the Company, the Company’s office or
agency in New York will be the office of the Trustee maintained for such
purpose.

 

SECTION 3. Paying
Agent and Registrar. Initially, Wells Fargo Bank, National Association, 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 Affiliate may act in any such capacity.

 

SECTION 4. Indenture
and Subordination. The Company issued the Securities under an Indenture
dated as of April 8, 2004 (“Indenture”) between the Company and
the Trustee. The terms of the Securities include those stated in the Indenture
and those made part of the Indenture by reference to the Trust Indenture Act of
1939, as amended (15 U.S. Code §§ 77aaa-77bbbb) (the “TIA”).
The Securities are subject to all such terms, and Holders are referred to the
Indenture and the TIA for a statement of such terms. To the extent any
provision of this Security conflicts with the express provisions of the
Indenture, the provisions of the Indenture shall govern and be controlling. The
payment of the Securities will, to the extent set forth in the Indenture, be
subordinated in right of payment to the prior payment in full in cash or Cash
Equivalents of all Senior Debt.

 

SECTION 5. Optional
Redemption. (a) The Securities may be redeemed, in whole or in part, at any
time prior to April 15, 2009, at the option of the Company upon not less than
30 nor more than 60 days’ prior notice mailed by first-class mail to each
Holder’s registered address, at a redemption price equal to 100% of the
principal amount of the Securities redeemed plus the Applicable Premium as of,
and accrued and unpaid interest and Additional Interest, if any, to, the
applicable redemption date (subject to the right of Holders of record on the
relevant record date to receive interest due on the relevant interest payment
date).

 

For purposes
of the preceding paragraph, the following terms will have the following
definitions:

 

“Applicable
Premium” means, with respect to any Security on any applicable
redemption date, the greater of:

 

(1)           1.0% of the then outstanding
principal amount of the Security; and

 

(2)           the excess of:

 

(a)           the present value at
such redemption date of (i) the redemption price of the Security at April 15,
2009, as applicable (such redemption price being set forth in the table
appearing under paragraph (b)) plus (ii) all required

 

A-5

 

interest
payments due on the Dollar Security through April 15, 2009, as applicable
(excluding accrued but unpaid interest), computed using a discount rate equal
to the Treasury Rate as of such redemption date plus 50 basis points; over

 

(b)           the then outstanding
principal amount of the Security.

 

“Treasury Rate” means,
as of the applicable redemption date, the yield to maturity as of such
redemption date 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 April 15, 2009; provided, however, that
if the period from such redemption date to April 15, 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 will be used.

 

(b)           On or after April 15, 2009, the
Dollar Securities will be subject to redemption at any time at the option of
the Company, in whole or in part, upon not less than 30 nor more than 60 days’
notice, at the redemption prices (expressed as percentages of principal amount)
set forth below plus accrued and unpaid interest and Additional Interest
thereon, if any, to the applicable redemption date, if redeemed during the
twelve-month period beginning on April 15 of the years indicated below:

 

	
  Year

  	
   

  	
  Percentage

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  2009

  	
   

  	
  103.688

  	
  %

  
	
  2010

  	
   

  	
  102.458

  	
  %

  
	
  2011

  	
   

  	
  101.229

  	
  %

  
	
  2012 and thereafter

  	
   

  	
  100.000

  	
  %

  

 

SECTION 6. Optional
Redemption upon Equity Offering. At any time on or prior to April 15, 2007,
the Company may on any one or more occasions redeem up to 35% of the aggregate
principal amount of Dollar Securities issued under the Indenture (calculated
after giving effect to the issuance of Additional Dollar Securities) at a
redemption price equal to 107.375% of the principal amount thereof, plus
accrued and unpaid interest and Additional Interest thereon, if any, to the
redemption date, with the net cash proceeds of Equity Offerings; provided
that (i) at least 65% of the aggregate principal amount of Dollar
Securities issued under the Indenture (calculated after giving effect to the
issuance of Additional Dollar Securities) remains outstanding immediately after
the occurrence of such redemption (excluding Dollar Securities held by the Company
and its Subsidiaries) and (ii) such redemption shall occur within 90 days of
the date of the closing of such Equity Offering (disregarding the date of the
closing of any over-allotment option
with respect thereto).

 

A-6

 

SECTION 7. Mandatory
Redemption. For the avoidance of doubt, an offer to purchase pursuant to
Section 8 hereof shall not be deemed a redemption. The Company shall not be
required to make mandatory redemption or sinking fund payments with respect to
the Securities.

 

SECTION 8. Offers
To Purchase. The Indenture provides that upon the occurrence of a Change of
Control or an Asset Sale and subject to further limitations contained therein,
the Company shall make an offer to purchase outstanding Securities in
accordance with the procedures set forth in the Indenture.

 

SECTION 9. Notice
of Redemption. Notice of redemption will be mailed by first class mail at
least 30 days but not more than 60 days before the redemption date to each
Holder of Securities to be redeemed at its registered address. Dollar
Securities in denominations larger than $5,000 may be redeemed in part. If any
Security is to be redeemed in part only, the notice of redemption that relates
to such Security shall state the portion of the principal amount thereof to be
redeemed. A new Security in principal amount equal to the unredeemed portion thereof
will be issued in the name of the Holder thereof upon cancellation of the
original Security. On and after the redemption date interest ceases to accrue
on Securities or portions thereof called for redemption.

 

SECTION 10. Denominations,
Transfer, Exchange. The Dollar Securities are in registered form without
coupons in denominations of $5,000 and integral multiples of $1,000. The
transfer of Securities may be registered and Securities 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 or the Registrar is not required to
transfer or exchange any Security selected for redemption. Also, the Company or
the Registrar is not required to transfer or exchange any Securities for a
period of 15 days before a selection of Securities to be redeemed.

 

SECTION 11. Persons
Deemed Owners. The registered Holder of a Security may be treated as its
owner for all purposes.

 

SECTION 12. Amendment,
Supplement and Waiver. Subject to certain exceptions, the Indenture and the
Securities may be amended or supplemented with the written consent of the
Holders of at least a majority in aggregate principal amount of the Securities
then outstanding, and any existing Default or compliance with any provision may
be waived with the consent of the Holders of a majority in aggregate principal
amount of the Securities then outstanding. Without notice to or consent of any
Holder, the parties thereto may amend or supplement the Indenture and the
Securities to, among other things, cure any ambiguity, defect or inconsistency
in the Indenture, provide for uncertificated Securities in addition to
certificated Securities, comply with any requirements of the Commission in
connection with the qualification of the Indenture under the TIA, or make any
change that does not adversely affect the rights of any Holder of a Security; provided, however, that
if any amendment,

 

A-7

 

waiver or other modification
will only affect the Dollar Securities or the Sterling Securities, only the
consent of the Holders of at least a majority in principal amount of the then
outstanding Dollar Securities or Sterling Securities (and not the consent of at
least a majority of all Securities), as the case may be, shall be required.

 

SECTION 13. Defaults
and Remedies. If a Default occurs and is continuing, the Trustee or the
Holders of at least 25% in aggregate principal amount of the then outstanding
Securities generally may declare all the Securities to be due and payable
immediately. Notwithstanding the foregoing, in the case of a Default arising
from certain events of bankruptcy or insolvency as set forth in the Indenture,
with respect to the Company, all outstanding Securities will become due and
payable without further action or notice. Holders of the Securities may not
enforce the Indenture or the Securities except as provided in the Indenture.
Subject to certain limitations, Holders of a majority in aggregate principal
amount of the then outstanding Securities may direct the Trustee in its
exercise of any trust or power. The Trustee may withhold from Holders notice of
any continuing Default (except a Default relating to the payment of principal
or interest) if it determines that withholding notice is in their interest. The
Holders of a majority in aggregate principal amount of the Securities then
outstanding by notice to the Trustee may on behalf of the Holders of all of the
Securities waive any Default and its consequences under the Indenture except a
continuing Default in the payment of interest on, or the principal of the
Securities or in respect of certain covenants set forth in the Indenture.

 

SECTION 14. Restrictive
Covenants. The Indenture contains certain covenants that, among other
things, limit the ability of the Company and its Restricted Subsidiaries to
make restricted payments, to incur indebtedness, to create liens, to sell
assets, to permit restrictions on dividends and other payments by Restricted
Subsidiaries of the Company, to consolidate, merge or sell all or substantially
all of its assets or to engage in transactions with affiliates. The limitations
are subject to a number of important qualifications and exceptions. The Company
must annually report to the Trustee on compliance with such limitations.

 

SECTION 15. No
Recourse Against Others. No director, officer, employee, incorporator or
stockholder of the Company or any direct or indirect parent corporation or any
Guarantor, as such, shall have any liability for any obligations of the Company
or the Guarantors under the Securities, the Indenture, the Guarantors’ Subsidiary
Guarantees or for any claim based on, in respect of, or by reason of, such
obligations or their creation. Each Holder of Securities by accepting a
Security waives and releases all such liability. The waiver and release are
part of the consideration for issuance of the Securities.

 

SECTION 16. Trustee
Dealings with the Company. The Trustee under the Indenture, in its
individual or any other capacity, may become the owner or pledgee of Securities
and may otherwise deal with the Company, its Subsidiaries or their respective
Affiliates as if it were not the Trustee.

 

A-8

 

SECTION 17. Authentication.
This Security shall not be valid until authenticated by the manual signature of
the Trustee or an authenticating agent.

 

SECTION 18. 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 entirety), 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).

 

SECTION 19. Additional
Rights of Holders of Restricted Global Securities  and Restricted
Definitive Securities. Pursuant to, but subject to the exceptions in, the
Registration Rights Agreement, the Company and the Guarantors, if any, will be
obligated to consummate an exchange offer pursuant to which the Holder of this
Security shall have the right to exchange this Initial Security for a 7 3/8%
Senior Subordinated Note due 2014 of the Company which shall have been
registered under the Securities Act, in like principal amount and having terms
identical in all material respects to this Initial Security (except that such
note shall not be entitled to Additional Interest). The Holders shall be
entitled to receive certain Additional Interest in the event such exchange
offer is not consummated or the Securities are not offered for resale and upon
certain other conditions, all pursuant to and in accordance with the terms of
the Registration Rights Agreement.(a)

 

(a)           This
Section not to appear on Exchange Securities.

 

SECTION 20. Guarantees.
The Securities will be entitled to the benefits of certain Guarantees made for
the benefit of the Holders. Reference is hereby made to the Indenture for a
statement of the respective rights, limitations of rights, duties and
obligations thereunder of the Guarantors, the Trustee and the Holders.

 

SECTION 21. CUSIP
Numbers. Pursuant to a recommendation promulgated by the Committee on
Uniform Security Identification Procedures, the Company has caused CUSIP
numbers to be printed on the Securities and the Trustee may use CUSIP numbers
in notices of redemption as a convenience to Holders. No representation is made
as to the accuracy of such numbers either as printed on the Securities or as
contained in any notice of redemption and reliance may be placed only on the
other identification numbers placed thereon.

 

SECTION 22. Governing
Law. This Security shall be governed by,
and construed in accordance with, the laws of the State of New York

 

The Company
will furnish to any Holder upon written request and without charge a copy of
the Indenture.

 

 

A-9

 

ASSIGNMENT FORM

 

I or we assign
and transfer this Security to:

 

	
   

  
	
  (Insert assignee’s social security or tax I.D. number)

  
	
   

  
	
   

  
	
  (Print or type name, address and zip code of assignee)

  

 

and
irrevocably appoint:

 

Agent to
transfer this Security on the books of the Company. The Agent may substitute
another to act for him.

 

	
  Date:

  	
   

  	
  Your Signature:  

  	
   

  
	
   

  	
   

  	
   

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

  
	
   

  
	
   

  
	
  Signature
  Guarantee:

  	
   

  	
   

  
						

 

 

SIGNATURE GUARANTEE

 

Signatures
must be guaranteed by an “eligible guarantor institution” meeting the
requirements of the Registrar, which requirements include membership or
participation in the Security Transfer Agent Medallion Program (“STAMP”) or
such other “signature guarantee program” as may be determined by the Registrar
in addition to, or in substitution for, STAMP, all in accordance with the
Securities Exchange Act of 1934, as amended.

 

 

OPTION OF HOLDER TO ELECT PURCHASE

 

If you want to
elect to have this Security purchased by the Company pursuant to Section 4.09
or Section 4.13 of the Indenture, check the appropriate box:

 

Section 4.09 o      Section 4.13 o

 

If you want to
elect to have only part of this Security purchased by the Company pursuant to
Section 4.09 or Section 4.13 of the Indenture, state the amount: $

 

 

	
  Dated:

  	
   

  	
   

  	
  Signed:

  	
   

  	
   

  
	
   

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

  	
   

  
	
   

  
	
   

  
	
  Signature
  Guarantee:

  	
   

  	
   

  
	
   

  	
  Participant
  in a recognized Signature Guarantee Medallion Program (or other signature
  guarantor program reasonably acceptable to the Trustee)

  	
   

  
								

 

2

 

EXHIBIT B

 

[FORM OF INITIAL STERLING SECURITY]

 

WMG ACQUISITION CORP.

8 1/8% Senior Subordinated Notes due 2014

 

CUSIP No.

ISIN No.

Common Code

	
  No.

  	
  £ [

  	
  ]

  

 

WMG
ACQUISITION CORP., a Delaware corporation (the “Company,” which term includes
any successor corporation), for value received promises to pay to HSBC ISSUER
SERVICES COMMON DEPOSITARY NOMINEE (UK) LIMITED or its registered assigns, the
principal sum of [                       ]
pounds sterling (£[                       ])
on April 15, 2014.

 

Interest
Payment Dates: April 15 and October 15 commencing October 15, 2004.

 

Record Dates:
April 1 and October 1.

 

Reference is
made to the further provisions of this Sterling Security contained herein,
which will for all purposes have the same effect as if set forth at this place.

 

B-1

 

IN WITNESS
WHEREOF, the Company has caused this Security to be signed manually or by
facsimile by its duly authorized officers.

 

 

	
   

  	
  WMG
  ACQUISITION CORP.

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
   

  
	
   

  	
   

  	
  Name:

  
	
   

  	
   

  	
  Title:

  

 

B-2

 

CERTIFICATE OF AUTHENTICATION

 

This is one of
the 8 1/8% Senior Subordinated Notes due 2014 described in the within-mentioned
Indenture.

 

	
  Dated:

  	
  WELLS FARGO
  BANK,

  NATIONAL ASSOCIATION,

  as Trustee

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
   

  
	
   

  	
   

  	
  Authorized
  Signatory

  

 

B-3

 

(Reverse of Sterling Security)

WMG Acquisition Corp.

 

8 1/8% Senior Subordinated Notes due 2014

 

[Insert the Global Security Legend, if
applicable pursuant to the provisions of the Indenture]

 

[Insert the Private Placement Legend,
if applicable pursuant to the
provisions of the Indenture]

 

Capitalized
terms used herein shall have the meanings assigned to them in the Indenture
referred to below unless otherwise indicated.

 

SECTION 1. Interest.
WMG Acquisition Corp., a Delaware corporation (the “Company”), promises to pay interest on the
principal amount of this Sterling Security at 8 1/8% per annum from April 8,
2004 until maturity. The Company will pay interest semiannually on April 15 and
October 15 of each year, or if any such day is not a Business Day, on the next
succeeding Business Day (each an “Interest Payment Date”). Interest on
the Sterling Securities will accrue from the most recent date to which interest
has been paid or, if no interest has been paid, from the date of original
issuance; provided that if there
is no existing Default in the payment of interest, and if this Sterling
Security 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 October 15,
2004. The Company shall pay interest (including post-petition interest in any
proceeding under any Bankruptcy Law) on overdue principal and premium, if any,
from time to time on demand to the extent lawful at the interest rate
applicable to the Sterling Securities; it shall pay interest (including post-petition
interest in any proceeding under any Bankruptcy Law) on overdue installments of
interest (without regard to any applicable grace periods) from time to time on
demand at the same rate to the extent lawful. Interest will be computed on the
basis of a 360-day year of twelve 30 day months.

 

SECTION 2. Method
of Payment. The Company will pay interest on the Sterling Securities
(except defaulted interest) to the Persons who are registered Holders of
Sterling Securities at the close of business on the April 1 or October 1 next
preceding the Interest Payment Date, even if such Securities are canceled after
such record date and on or before such Interest Payment Date, except as
provided in Section 2.13 of the Indenture with respect to defaulted interest.
The Sterling Securities will be issued in denominations of £5,000 and integral
multiples of £1,000. The Company shall pay principal, premium, if any and
interest on the Sterling Securities in such coin or currency of the United
Kingdom as at the time of payment is legal tender for payment of public and
private debts (“U.K. Legal Tender”). Principal, premium, if any, and
interest on the Sterling Securities will be payable at the office or agency of
the Company maintained for such purpose or, at the option of the Company,
payment of interest may be made by check mailed to the Holders at their
respective addresses set

 

B-4

 

forth in the register of
Holders; provided that all payments of principal,
premium and interest with respect to Securities the Holders of which have given
wire transfer instructions to the Company prior to the Record Date will be
required to be made by wire transfer of immediately available funds to the
accounts specified by the Holders thereof. Until otherwise designated by the
Company, the Company's office or agency in New York will be the office of the
Trustee maintained for such purpose.

 

SECTION 3. PayingAgent and Registrar. Initially, HSBC Bank plc 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 Affiliate may act in any such
capacity.

 

SECTION 4. Indenture
and Subordination. The Company issued the Securities under an Indenture
dated as of April 8, 2004 (“Indenture”) between the Company and
the Trustee. The terms of the Securities include those stated in the Indenture
and those made part of the Indenture by reference to the Trust Indenture Act of
1939, as amended (15 U.S. Code §§ 77aaa-77bbbb) (the “TIA”).
The Securities are subject to all such terms, and Holders are referred to the
Indenture and the TIA for a statement of such terms. To the extent any
provision of this Security conflicts with the express provisions of the
Indenture, the provisions of the Indenture shall govern and be controlling. The
payment of the Securities will, to the extent set forth in the Indenture, be
subordinated in right of payment to the prior payment in full in cash or Cash
Equivalents of all Senior Debt.

 

SECTION 5. Optional
Redemption. (a) The Securities may be redeemed, in whole or in part, at any
time prior to April 15, 2009, at the option of the Company upon not less than
30 nor more than 60 days’ prior notice mailed by first-class mail to each
Holder’s registered address, at a redemption price equal to 100% of the
principal amount of the Securities redeemed plus the Applicable Premium as of,
and accrued and unpaid interest and Additional Interest, if any, to, the
applicable redemption date (subject to the right of Holders of record on the
relevant record date to receive interest due on the relevant interest payment
date).

 

For purposes
of the preceding paragraph, the following terms will have the following
definitions:

 

“Applicable
Premium” means, with respect to any Security on any
applicable redemption date, the greater of:

 

(1)           1.0% of the then outstanding
principal amount of the Security; and

 

(2)           the excess of:

 

(a)           the present value at
such redemption date of (i) the redemption price of the Security at April 15,
2009, as applicable (such redemption price being set forth in the table
appearing under paragraph (b)) plus (ii) all required interest payments due on
the Security through April 15, 2009, as applicable (excluding accrued but
unpaid interest), computed using a discount rate equal to the Treasury Rate as
of such redemption date plus 50 basis points; over

 

B-5

 

(b)           the then outstanding
principal amount of the Security.

 

“Treasury Rate” means
the yield to maturity as of such redemption date of U.K. Government Securities
with a constant maturity (as compiled by the Office for National Statistics and
published in the most recent financial statistics that have become publicly
available at least two business days in London prior to such redemption date
(or, if such financial statistics are no longer published, any publicly
available source of similar market data)) most nearly equal to the period from
such redemption date to April 15, 2009; provided, however, that if the period from
such redemption date to April 15, 2009 is less than one year, the weekly
average yield on actually traded U.K. Government Securities adjusted to a constant maturity of one year shall
be used.

 

(b)           On or after April 15, 2009, the
Sterling Securities will be subject to redemption at any time at the option of
the Company, in whole or in part, upon not less than 30 nor more than 60 days’
notice, at the redemption prices (expressed as percentages of principal amount)
set forth below plus accrued and unpaid interest and Additional Interest
thereon, if any, to the applicable redemption date, if redeemed during the
twelve-month period beginning on April 15 of the years indicated below:

 

	
  Year

  	
   

  	
  Percentage

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  2009

  	
   

  	
  104.063

  	
  %

  
	
  2010

  	
   

  	
  102.708

  	
  %

  
	
  2011

  	
   

  	
  101.354

  	
  %

  
	
  2012 and thereafter

  	
   

  	
  100.000

  	
  %

  

 

SECTION 6. Optional
Redemption upon Equity Offering. At any time on or prior to April 15, 2007,
the Company may on any one or more occasions redeem up to 35% of the aggregate
principal amount of Sterling Securities issued under the Indenture (calculated
after giving effect to the issuance of Additional Sterling Securities) at a
redemption price equal to 108.125% of the principal amount thereof, plus
accrued and unpaid interest and Additional Interest thereon, if any, to the redemption
date, with the net cash proceeds of Equity Offerings; provided that
(i) at least 65% of the aggregate principal amount of Sterling Securities
issued under the Indenture (calculated after giving effect to the issuance of
Additional Sterling Securities) remains outstanding immediately after the
occurrence of such redemption (excluding Sterling Securities held by the
Company and its Subsidiaries) and (ii) such redemption shall occur within 90
days of the date of the closing of such Equity Offering (disregarding the date
of the closing of any over-allotment option with respect thereto).

 

SECTION 7. Mandatory
Redemption. For the avoidance of doubt, an offer to purchase pursuant to
Section 8 hereof shall not be deemed a redemption. The Company shall not be
required to make mandatory redemption or sinking fund payments with respect to
the Securities.

 

B-6

 

SECTION 8. Offers
To Purchase. The Indenture provides that upon the occurrence of a Change of
Control or an Asset Sale and subject to further limitations contained therein,
the Company shall make an offer to purchase outstanding Securities in
accordance with the procedures set forth in the Indenture.

 

SECTION 9. Notice
of Redemption. Notice of redemption will be mailed by first class mail at
least 30 days but not more than 60 days before the redemption date to each
Holder of Securities to be redeemed at its registered address. Sterling
Securities in denominations larger than £5,000 may be redeemed in part. If any
Security is to be redeemed in part only, the notice of redemption that relates
to such Security shall state the portion of the principal amount thereof to be
redeemed. A new Security in principal amount equal to the unredeemed portion
thereof will be issued in the name of the Holder thereof upon cancellation of
the original Security. On and after the redemption date interest ceases to
accrue on Securities or portions thereof called for redemption.

 

SECTION 10. Denominations,
Transfer, Exchange. The Sterling Securities are in registered form without
coupons in denominations of £5,000 and integral multiples of £1,000. The
transfer of Securities may be registered and Securities 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 or the Registrar is not required to
transfer or exchange any Security selected for redemption. Also, the Company or
the Registrar is not required to transfer or exchange any Securities for a
period of 15 days before a selection of Securities to be redeemed.

 

SECTION 11. Persons
Deemed Owners. The registered Holder of a Security may be treated as its
owner for all purposes.

 

SECTION 12. Amendment,
Supplement and Waiver. Subject to certain exceptions, the Indenture and the
Securities may be amended or supplemented with the written consent of the
Holders of at least a majority in aggregate principal amount of the Securities
then outstanding, and any existing Default or compliance with any provision may
be waived with the consent of the Holders of a majority in aggregate principal
amount of the Securities then outstanding. Without notice to or consent of any
Holder, the parties thereto may amend or supplement the Indenture and the
Securities to, among other things, cure any ambiguity, defect or inconsistency
in the Indenture, provide for uncertificated Securities in addition to
certificated Securities, comply with any requirements of the Commission in
connection with the qualification of the Indenture under the TIA, or make any
change that does not adversely affect the rights of any Holder of a Security; provided, however, that
if any amendment, waiver or other modification will only affect the Dollar
Securities or the Sterling Securities, only the consent of the Holders of at
least a majority in principal amount of the then outstanding Dollar Securities
or Sterling Securities (and not the consent of at least a majority of all
Securities), as the case may be, shall be required.

 

B-7

 

SECTION 13. Defaults
and Remedies. If a Default occurs and is continuing, the Trustee or the
Holders of at least 25% in aggregate principal amount of the then outstanding
Securities generally may declare all the Securities to be due and payable
immediately. Notwithstanding the foregoing, in the case of a Default arising from
certain events of bankruptcy or insolvency as set forth in the Indenture, with
respect to the Company, all outstanding Securities will become due and payable
without further action or notice. Holders of the Securities may not enforce the
Indenture or the Securities except as provided in the Indenture. Subject to
certain limitations, Holders of a majority in aggregate principal amount of the
then outstanding Securities may direct the Trustee in its exercise of any trust
or power. The Trustee may withhold from Holders notice of any continuing
Default (except a Default relating to the payment of principal or interest) if
it determines that withholding notice is in their interest. The Holders of a
majority in aggregate principal amount of the Securities then outstanding by
notice to the Trustee may on behalf of the Holders of all of the Securities
waive any Default and its consequences under the Indenture except a continuing
Default in the payment of interest on, or the principal of the Securities or in
respect of certain covenants set forth in the Indenture.

 

SECTION 14. Restrictive
Covenants. The Indenture contains certain covenants that, among other
things, limit the ability of the Company and its Restricted Subsidiaries to
make restricted payments, to incur indebtedness, to create liens, to sell
assets, to permit restrictions on dividends and other payments by Restricted
Subsidiaries of the Company, to consolidate, merge or sell all or substantially
all of its assets or to engage in transactions with affiliates. The limitations
are subject to a number of important qualifications and exceptions. The Company
must annually report to the Trustee on compliance with such limitations.

 

SECTION 15. No
Recourse Against Others. No director, officer, employee, incorporator or
stockholder of the Company or any direct or indirect parent corporation or any
Guarantor, as such, shall have any liability for any obligations of the Company
or the Guarantors under the Securities, the Indenture, the Guarantors’
Subsidiary Guarantees or for any claim based on, in respect of, or by reason
of, such obligations or their creation. Each Holder of Securities by accepting
a Security waives and releases all such liability. The waiver and release are
part of the consideration for issuance of the Securities.

 

SECTION 16. Trustee
Dealings with the Company. The Trustee under the Indenture, in its
individual or any other capacity, may become the owner or pledgee of Securities
and may otherwise deal with the Company, its Subsidiaries or their respective
Affiliates as if it were not the Trustee.

 

SECTION 17. Authentication.
This Security shall not be valid until authenticated by the manual signature of
the Trustee or an authenticating agent.

 

SECTION 18. 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 entirety), 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).

 

B-8

 

SECTION 19. Additional
Rights of Holders of Restricted Global Securities and Restricted Definitive
Securities. Pursuant to, but subject to the exceptions in, the Registration
Rights Agreement, the Company and the Guarantors, if any, will be obligated to
consummate an exchange offer pursuant to which the Holder of this Security
shall have the right to exchange this Initial Security for a 8 1/8% Senior
Subordinated Note due 2014 of the Company which shall have been registered
under the Securities Act, in like principal amount and having terms identical
in all material respects to this Initial Security (except that such note shall
not be entitled to Additional Interest). The Holders shall be entitled to
receive certain Additional Interest in the event such exchange offer is not
consummated or the Securities are not offered for resale and upon certain other
conditions, all pursuant to and in accordance with the terms of the
Registration Rights Agreement. (a)

 

(a)           This
Section not to appear on Exchange Securities.

 

SECTION 20. Guarantees.
The Securities will be entitled to the benefits of certain Guarantees made for
the benefit of the Holders. Reference is hereby made to the Indenture for a
statement of the respective rights, limitations of rights, duties and
obligations thereunder of the Guarantors, the Trustee and the Holders.

 

SECTION 21. CUSIP
Numbers, ISINs and Common Codes. The Company has caused CUSIP numbers and
ISINs and, in the case of the Sterling Securities, Common Codes to be printed
on the Securities and has directed the Trustee to use CUSIP numbers and ISINs
and, in the case of the Sterling Securities, Common Codes in notices of
redemption as a convenience to the Holders. No representation is made as to the
accuracy of such numbers either as printed on the Securities or as contained in
any notice of redemption and reliance may be placed only on the other
identification numbers placed thereon.

 

SECTION 22. Governing
Law. This Security shall be governed by,
and construed in accordance with, the laws of the State of New York.

 

The Company
will furnish to any Holder upon written request and without charge a copy of
the Indenture.

 

 

B-9

 

ASSIGNMENT FORM

 

I or we assign
and transfer this Security to:

 

	
   

  
	
  (Insert assignee’s social security or tax I.D. number)

  
	
   

  
	
   

  
	
  (Print or type name, address and zip code of assignee)

  

 

and
irrevocably appoint:

 

Agent to
transfer this Security on the books of the Company. The Agent may substitute
another to act for him.

 

	
  Date:

  	
   

  	
  Your Signature:  

  	
   

  
	
   

  	
   

  	
   

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

  
	
   

  
	
   

  
	
  Signature
  Guarantee:

  	
   

  	
   

  
						

 

SIGNATURE GUARANTEE

 

Signatures
must be guaranteed by an “eligible guarantor institution” meeting the
requirements of the Registrar, which requirements include membership or
participation in the Security Transfer Agent Medallion Program (“STAMP”) or
such other “signature guarantee program” as may be determined by the Registrar
in addition to, or in substitution for, STAMP, all in accordance with the
Securities Exchange Act of 1934, as amended.

 

 

OPTION OF HOLDER TO ELECT PURCHASE

 

If you want to
elect to have this Security purchased by the Company pursuant to Section 4.09
or Section 4.13 of the Indenture, check the appropriate box:

 

Section 4.09 o      Section 4.13 o

 

If you want to
elect to have only part of this Security purchased by the Company pursuant to
Section 4.09 or Section 4.13 of the Indenture, state the amount: £

 

 

	
  Dated:

  	
   

  	
   

  	
  Signed:

  	
   

  	
   

  
	
   

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

  	
   

  
	
   

  
	
   

  
	
  Signature
  Guarantee:

  	
   

  	
   

  
	
   

  	
  Participant
  in a recognized Signature Guarantee Medallion Program (or other signature
  guarantor program reasonably acceptable to the Trustee)

  	
   

  
								

 

 

EXHIBIT C-1

 

[FORM OF LEGEND FOR DOLLAR 144A SECURITIES AND

OTHER DOLLAR SECURITIES THAT ARE RESTRICTED SECURITIES]

 

The Securities evidenced hereby have not been
registered under the United States Securities Act of 1933, as amended (the “Securities
Act”), and may not be offered, sold, pledged or otherwise transferred except
(a) (1) to a person who the seller reasonably believes is a qualified
institutional buyer within the meaning of Rule 144A under the Securities Act
purchasing for its own account or for the account of a qualified institutional
buyer in a transaction meeting the requirements of Rule 144A, (2) in an
offshore transaction complying with Rule 903 or Rule 904 of Regulation S under
the Securities Act, (3) pursuant to an exemption from registration under the
Securities Act provided by Rule 144 thereunder (if available), (4) to an
institutional accredited investor in a transaction exempt from the registration
requirements of the Securities Act or (5) pursuant to an effective registration
statement under the Securities Act and (b) in accordance with all applicable
securities laws of the United States and other jurisdictions.

 

C-1-1

 

EXHIBIT C-2

 

[FORM OF LEGEND FOR STERLING 144A SECURITIES AND

OTHER STERLING SECURITIES THAT ARE RESTRICTED SECURITIES]

 

THIS SECURITY (OR ITS PREDECESSOR) HAS NOT
BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED (THE “SECURITIES
ACT”), OR THE SECURITIES LAWS OF ANY STATE OR OTHER JURISDICTION. NEITHER THIS
SECURITY NOR ANY INTEREST OR PARTICIPATION HEREIN MAY BE REOFFERED, SOLD,
ASSIGNED, TRANSFERRED, PLEDGED, ENCUMBERED OR OTHERWISE DISPOSED OF IN THE
ABSENCE OF SUCH REGISTRATION OR UNLESS SUCH TRANSACTION IS EXEMPT FROM, OR NOT
SUBJECT TO, SUCH REGISTRATION. THE HOLDER OF THIS SECURITY, BY ITS ACCEPTANCE
HEREOF, (1) REPRESENTS THAT (A) IT IS A “QUALIFIED INSTITUTIONAL BUYER” (AS
DEFINED IN RULE 144A UNDER THE SECURITIES ACT) PURCHASING FOR ITS OWN ACCOUNT
OR THE ACCOUNT OF A QUALIFIED INSTITUTIONAL BUYER IN A TRANSACTION MEETING THE
REQUIREMENTS OF RULE 144A OR (B) IT IS ACQUIRING THIS SECURITY IN AN OFFSHORE
TRANSACTION IN COMPLIANCE WITH REGULATION S UNDER THE SECURITIES ACT, (2)
AGREES ON ITS OWN BEHALF AND ON BEHALF OF ANY INVESTOR ACCOUNT FOR WHICH IT HAS
PURCHASED SECURITIES, TO OFFER, SELL OR OTHERWISE TRANSFER SUCH SECURITY, PRIOR
TO THE DATE (THE “RESALE RESTRICTION TERMINATION DATE”) THAT IS [IN THE
CASE OF RULE 144A SECURITIES: TWO YEARS] [IN THE
CASE OF REGULATION S SECURITIES: 40 DAYS] AFTER THE
LATER OF THE ORIGINAL ISSUE DATE HEREOF AND THE LAST DATE ON WHICH THE COMPANY
OR ANY AFFILIATE OF THE COMPANY WAS THE OWNER OF THIS SECURITY (OR ANY
PREDECESSOR OF SUCH SECURITY), ONLY (A) TO THE COMPANY OR ANY OF ITS
SUBSIDIARIES, (B) PURSUANT TO A REGISTRATION STATEMENT THAT HAS BEEN DECLARED
EFFECTIVE UNDER THE SECURITIES ACT, (C) FOR SO LONG AS THE SECURITIES ARE
ELIGIBLE FOR RESALE PURSUANT TO RULE 144A UNDER THE SECURITIES ACT, TO A PERSON
IT REASONABLY BELIEVES IS A QUALIFIED INSTITUTIONAL BUYER THAT PURCHASES FOR
ITS OWN ACCOUNT OR FOR THE ACCOUNT OF A QUALIFIED INSTITUTIONAL BUYER TO WHOM
NOTICE IS GIVEN THAT THE TRANSFER IS BEING MADE IN RELIANCE ON RULE 144A, (D)
PURSUANT TO OFFERS AND SALES THAT OCCUR OUTSIDE THE UNITED STATES WITHIN THE
MEANING OF REGULATION S UNDER THE SECURITIES ACT, (E) TO AN INSTITUTIONAL “ACCREDITED
INVESTOR” WITHIN THE MEANING OF RULE 501(a)(1), (2), (3) OR (7) OF REGULATION D
UNDER THE SECURITIES ACT THAT IS AN INSTITUTIONAL ACCREDITED INVESTOR ACQUIRING
THE SECURITY FOR ITS OWN ACCOUNT OR FOR THE ACCOUNT OF SUCH AN INSTITUTIONAL
ACCREDITED INVESTOR, IN EACH CASE IN A MINIMUM

 

C-2-1

 

PRINCIPAL
AMOUNT OF THE SECURITIES OF THE POUNDS STERLING EQUIVALENT OF $250,000, FOR
INVESTMENT PURPOSES AND NOT WITH A VIEW TO OR FOR OFFER OR SALE IN CONNECTION
WITH ANY DISTRIBUTION IN VIOLATION OF THE SECURITIES ACT, OR (F) PURSUANT TO
ANOTHER AVAILABLE EXEMPTION FROM THE REGISTRATION REQUIREMENTS OF THE
SECURITIES ACT, SUBJECT TO THE COMPANY’S AND THE TRUSTEE’S RIGHT PRIOR TO ANY
SUCH OFFER, SALE OR TRANSFER PURSUANT TO CLAUSE (D), (E) OR (F) TO REQUIRE THE
DELIVERY OF AN OPINION OF COUNSEL, CERTIFICATION AND/OR OTHER INFORMATION
SATISFACTORY TO EACH OF THEM, AND (3) AGREES THAT IT WILL DELIVER TO EACH
PERSON TO WHOM THIS SECURITY OR AN INTEREST HEREIN IS TRANSFERRED A NOTICE
SUBSTANTIALLY TO THE EFFECT OF THIS LEGEND. THIS LEGEND WILL BE REMOVED UPON
THE REQUEST OF THE HOLDER AFTER THE RESALE RESTRICTION TERMINATION DATE.

 

Each Definitive Sterling Security shall bear the following additional
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.

 

C-2-2

 

[FORM OF ASSIGNMENT FOR 144A SECURITIES

AND OTHER SECURITIES THAT ARE RESTRICTED SECURITIES]

 

I or we assign
and transfer this Security to:

 

	
   

  
	
  (Insert assignee’s social security or tax I.D. number)

  
	
   

  
	
   

  
	
  (Print or type name, address and zip code of assignee)

  

 

and
irrevocably appoint:

 

Agent to
transfer this Security on the books of the Issuers. The Agent may substitute
another to act for him.

 

[Check One]

 

o (a) this Security is
being transferred in compliance with the exemption from registration under the
Securities Act provided by Rule 144A thereunder.

 

or

 

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

 

If none of the
foregoing boxes is checked, the Trustee or Registrar shall not be obligated to
register this Security in the name of any person other than the Holder hereof
unless and until the conditions to any such transfer of registration set forth
herein and in Sections 2.16 and 2.17 of the Indenture shall have been
satisfied.

 

	
  Date:

  	
   

  	
  Your Signature: 

  	
   

  
	
   

  	
   

  	
  (Sign
  exactly as your name

  appears on the face of this Security)

  
	
   

  	
   

  
	
  Signature
  Guarantee:

  	
   

  
					

 

SIGNATURE GUARANTEE

 

Signatures
must be guaranteed by an “eligible guarantor institution” meeting the
requirements of the Registrar, which requirements include membership or
participation in the Security Transfer Agent Medallion Program (“STAMP”) or
such other “signature guarantee program” as may be determined by the Registrar
in addition to, or in substitution for, STAMP, all in accordance with the
Securities Exchange Act of 1934, as amended.

 

C-2-3

 

TO BE COMPLETED BY TRANSFEROR IF (a) ABOVE IS CHECKED

 

The Transfer
is being effected pursuant to and in accordance with Rule 144A under the
Securities Act, and, accordingly, the Transferor hereby further certifies that
the beneficial interest or certificated Security is being Transferred to a
Person that the Transferor reasonably believed and believes is purchasing the
beneficial interest or certificated Security for its own account, or for one or
more accounts with respect to which such Person exercises sole investment
discretion, and such Person and each such account is a “qualified institutional
buyer” within the meaning of Rule 144A in a transaction meeting the
requirements of Rule 144A and such Transfer is in compliance with any
applicable securities laws of any state of the United States. Upon consummation
of the proposed Transfer in accordance with the terms of the Indenture, the
Transferred beneficial interest or certificated Security will be subject to the
restrictions on transfer enumerated on the Rule 144A Securities and/or the
certificated Security and in the Indenture and the Securities Act.

 

	
  Dated:

  	
   

  	
   

  	
   

  
	
   

  	
  NOTICE:

  	
  To be
  executed by an executive officer

  

 

C-2-4

 

EXHIBIT D

 

[FORM
OF LEGEND FOR REGULATION S SECURITY]

 

This Security has not been registered under the U.S. Securities Act of
1933, as amended (the “Act”), and, unless so registered, may not be offered,
sold or otherwise transferred within the United States or to, or for the
account or benefit of, U.S. Persons unless registered under the Act or except
pursuant to an exemption from, or in a transaction not subject to, the
registration requirements of the Act.

 

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.

 

D-1

 

[FORM
OF ASSIGNMENT FOR REGULATION S SECURITY]

 

I or we assign and transfer
this Security to:

 

	
   

  
	
  (Insert assignee’s social security or tax I.D. number)

  
	
   

  
	
   

  
	
  (Print or type name, address and zip code of assignee)

  

 

and irrevocably appoint:

 

Agent to transfer this
Security on the books of the Issuers. The Agent may substitute another to act
for him.

 

[Check
One]

 

o (a) this Security is being transferred in
compliance with the exemption from registration under the Securities Act
provided by Regulation S thereunder.

 

or

 

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

 

If none of the foregoing
boxes is checked, the Trustee or Registrar shall not be obligated to register
this Security in the name of any person other than the Holder hereof unless and
until the conditions to any such transfer of registration set forth herein and
in Sections 2.16 and 2.17 of the Indenture shall have been satisfied.

 

	
  Date:

  	
   

  	
  Your Signature: 

  	
   

  
	
   

  	
   

  	
  (Sign exactly as your name
  appears on the face of this Security)

  
	
   

  	
   

  
	
  Signature
  Guarantee:

  	
   

  
					

 

SIGNATURE
GUARANTEE

 

Signatures must be
guaranteed by an “eligible guarantor institution” meeting the requirements of
the Registrar, which requirements include membership or participation in the
Security Transfer Agent Medallion Program (“STAMP”) or such other “signature
guarantee program” as may be determined by the Registrar in addition to, or in
substitution for, STAMP, all in accordance with the Securities Exchange Act of
1934, as amended.

 

D-2

 

TO
BE COMPLETED BY TRANSFEROR IF (a) ABOVE IS CHECKED

 

The Transfer is being effected
pursuant to and in accordance with Rule 903 or Rule 904 under the Securities
Act and, accordingly, the Transferor hereby further certifies that (i) the
Transfer is not being made to a person in the United States and (x) at the time
the buy order was originated, the Transferee was outside the United States or
such Transferor and any Person acting on its behalf reasonably believed and
believes that the Transferee was outside the United States or (y) the
transaction was executed in, on or through the facilities of a designated
offshore securities market and neither such Transferor nor any Person acting on
its behalf knows that the transaction was prearranged with a buyer in the
United States, (ii) no directed selling efforts have been made in contravention
of the requirements of Rule 903(b) or Rule 904(b) of Regulation S under the
Securities Act, (iii) the transaction is not part of a plan or scheme to evade
the registration requirements of the Securities Act and (iv) if the proposed
Transfer is being made prior to the expiration of the restricted period under
Regulation S, the Transfer is not being made to a U.S. Person or for the
account or benefit of a U.S. Person (other than an initial purchaser). Upon
consummation of the proposed Transfer in accordance with the terms of the
Indenture, the Transferred beneficial interest or certificated Security will be
subject to the restrictions on Transfer enumerated on the Regulation S
Securities and/or the certificated Security and in the Indenture and the
Securities Act.

 

	
  Dated:

  	
   

  	
   

  	
   

  
	
   

  	
  NOTICE:

  	
  To be
  executed by an executive officer

  

 

D-3

 

EXHIBIT E-1

 

[FORM
OF LEGEND FOR GLOBAL DOLLAR SECURITY]

 

 

Any Global Security
authenticated and delivered hereunder shall bear a legend (which would be in
addition to any other legends required in the case of a Restricted Security) in
substantially the following form:

 

This
Security is a Global Security within the meaning of the Indenture hereinafter
referred to and is registered in the name of a Depository or a nominee of a
Depository. This Security is not exchangeable for Securities registered in the
name of a person other than the Depository or its nominee except in the limited
circumstances described in the Indenture, and no transfer of this Security
(other than a transfer of this Security as a whole by the Depository to a
nominee of the Depository or by a nominee of the Depository to the Depository
or another nominee of the Depository) 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 issuer 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 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.

 

E-1-1

 

EXHIBIT E-2

 

[FORM
OF LEGEND FOR GLOBAL STERLING SECURITY]

 

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

 

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

 

E-2-1

 

EXHIBIT F

 

Form of Certificate To Be

Delivered in Connection with

Transfers to Non-01B Accredited Investors

 

[          ], [     ]

 

Wells Fargo Bank, National Association

Sixth Street and Marquette Avenue

N9303-120

Minneapolis, MN 55179

 

 

Ladies and Gentlemen:

 

In connection
with our proposed purchase of U.S. Dollar-denominated 7 3/8% Senior
Subordinated Notes due 2014 and Sterling-denominated 8 1/8% Senior Subordinated
Notes due 2014 (the “Securities”) of WMG ACQUISITION CORP., a Delaware
corporation (“the Issuer”), we confirm that:

 

1.             We
have received a copy of the Offering Memorandum (the “Offering Memorandum”),
dated April 1, 2004, relating to the Securities and such other information as
we deem necessary in order to make our investment decision. We acknowledge that
we have read and agreed to the matters stated in the section entitled “Notice
to Investors” of such Offering Memorandum, including the restrictions on
duplication and circulation of the Offering Memorandum.

 

2.             We
understand that any subsequent transfer of the Securities is subject to certain
restrictions and conditions set forth in the Indenture relating to the
Securities (the “Indenture”) as described in the Offering Memorandum and the
undersigned agrees to be bound by, and not to resell, pledge or otherwise
transfer the Securities except in compliance with, such restrictions and
conditions and the Securities Act of 1933, as amended (the “Securities Act”),
and all applicable State securities laws.

 

3.             We
understand that the offer and sale of the Securities have not been registered
under the Securities Act, and that the Securities may not be offered or
sold except as permitted in the following sentence. We agree, on our own behalf
and on behalf of any accounts for which we are acting as hereinafter stated,
that if we should sell any Securities, we will do so only (i) to the Issuer or
any of its subsidiaries, (ii) inside the United States in accordance with Rule
144A under the Securities Act to a “qualified institutional buyer” (as defined
in Rule 144A under the Securities Act), (iii) inside the United States to an
institutional

 

F-1

 

“accredited investor” (as
defined below) that, prior to such transfer, furnishes (or has furnished on its
behalf by a U.S.
broker-dealer) to the Trustee (as defined in the Indenture) a signed letter
containing certain representations and agreements relating to the restrictions
on transfer of the Securities (the form of which letter can be obtained from
the Trustee), (iv) outside the United States in accordance with Regulation S
promulgated under the Securities Act to non-U.S. persons, (v) pursuant to the
exemption from registration provided by Rule 144 under the Securities Act (if
available), (vi) in accordance with another exemption from the registration
requirements of the Securities Act (and based upon an opinion of counsel if the
Issuer so requests) or (vii) pursuant to an effective registration statement
under the Securities Act, and we further agree to provide to any person
purchasing any of the Securities from us a notice advising such purchaser that
resales of the Securities are restricted as stated herein.

 

4.             We
are not acquiring the Securities for or on behalf of, and will not transfer the
Securities to, any pension or welfare plan (as defined in Section 3 of the
Employee Retirement Income Security Act of 1974, as amended) or plan (as
defined in Section 4975 of the Internal Revenue Code of 1986, as amended),
except as permitted in the section entitled “Notice to Investors” of the
Offering Circular.

 

5.             We
understand that, on any proposed resale of any Securities, we will be required
to furnish to the Trustee and the Issuer such certification, legal opinions and
other information as the Trustee and the Issuer may reasonably require to
confirm that the proposed sale complies with the foregoing restrictions. We
further understand that the Securities purchased by us will bear a legend to
the foregoing effect.

 

6.             We
are an institutional “accredited investor” (as defined in Rule 501(a)(l), (2),
(3) or (7) of Regulation D under the Securities Act) and have such knowledge
and experience in financial and business matters as to be capable of evaluating
the merits and risks of our investment in the Securities, and we and any
accounts for which we are acting are each able to bear the economic risk of our
or their investment, as the case may be.

 

7.             We
are acquiring the Securities purchased by us for our 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.

 

F-2

 

You, the Issuer, the Trustee and others are entitled
to rely upon this letter and are irrevocably authorized to produce this letter
or a copy hereof to any interested party in any administrative or legal
proceeding or official inquiry with respect to the matters covered hereby.

 

 

	
   

  	
  Very truly yours,

  
	
   

  	
   

  
	
   

  	
  [Name of Transferee]

  
	
   

  	
   

  
	
   

  	
  By:

  	
   

  
	
   

  	
   

  	
  Name:

  
	
   

  	
   

  	
  Title:

  

 

F-3

 

EXHIBIT G

 

Form of Certificate To Be Delivered

in Connection with Transfers

Pursuant to Regulation S

 

Wells Fargo Bank, National
Association

Sixth Street and Marquette
Avenue

N9303-120

Minneapolis, MN 55179

 

Re:                               WMG
Acquisition Corp. (“the Issuer”) U.S. Dollar-denominated 7 3/8% Senior
Subordinated Notes due 2014 and Sterling-denominated 8 1/8% Senior Subordinated
Notes due 2014 (the “Securities”)

 

Ladies and Gentlemen:

 

In connection
with our proposed sale of $[       ] or
£[      ] aggregate principal amount of the
Securities, we confirm that such sale has been effected pursuant to and in
accordance with Regulation S under the U.S. Securities Act of 1933, as amended
(the “Securities Act”), and, accordingly, we represent that:

 

(1)           the offer of the Securities was not
made to a person in the United States;

 

(2)           either (a) at the time the buy offer
was originated, the transferee was outside the United States or we and any
person acting on our behalf reasonably believed that the transferee was outside
the United States, or (b) the transaction was executed in, on or through the
facilities of a designated offshore securities market and neither we nor any
person acting on our behalf knows that the transaction has been prearranged
with a buyer in the United States;

 

(3)           no directed selling efforts have been
made in the United States in contravention of the requirements of Rule 903(b)
or Rule 904(b) of Regulation S, as applicable;

 

(4)           the transaction is not part of a plan
or scheme to evade the registration requirements of the Securities Act; and

 

(5)           we have advised the transferee of the
transfer restrictions applicable to the Securities.

 

G-1

 

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

 

 

	
   

  	
  Very truly yours,

  
	
   

  	
   

  
	
   

  	
  [Name of Transferor]

  
	
   

  	
   

  
	
   

  	
  By:

  	
   

  
	
   

  	
   

  	
  Authorized
  Signature

  

 

G-2

 

EXHIBIT H

 

GUARANTEE

 

Each of the undersigned (the
“Guarantors”) hereby jointly and severally unconditionally guarantees, to the
extent set forth in the Indenture dated as of April 8, 2004 by and among WMG
Acquisition Corp., a Delaware corporation, as issuer (the “Company”), the
Guarantors, as guarantors, and Wells Fargo Bank, National Association, as
Trustee (as amended, restated or supplemented from time to time, the “Indenture”),
and subject to the provisions of the Indenture, (a) the due and punctual
payment of the principal of, and premium, if any, and interest on the
Securities, when and as the same shall become due and payable, whether at
maturity, by acceleration or otherwise, the due and punctual payment of
interest on overdue principal of, and premium and, to the extent permitted by
law, interest, and the due and punctual performance of all other obligations of
the Issuer to the Holders or the Trustee, all in accordance with the terms set
forth in Article Eleven of the Indenture, and (b) in case of any extension of
time of payment or renewal of any Securities or any of such other obligations,
that the same will be promptly paid in full when due or performed in accordance
with the terms of the extension or renewal, whether at stated maturity, by
acceleration or otherwise.

 

The
obligations of the Guarantors to the Holders and to the Trustee pursuant to
this Guarantee and the Indenture are expressly set forth in Article Eleven of
the Indenture, and reference is hereby made to the Indenture for the precise
terms and limitations of this Guarantee. Each Holder of the Security to which
this Guarantee is endorsed, by accepting such Security, agrees to and shall be
bound by such provisions.

 

[Signatures
on Following Pages]

 

H-1

 

IN WITNESS
WHEREOF, each of the Guarantors has caused this Guarantee to be signed by a
duly authorized officer.

 

	
   

  	
  [                                             ]

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
   

  
	
   

  	
   

  	
  Name:

  
	
   

  	
   

  	
  Title:

  

 

H-2

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